Week in Review for 8/15/16 - 8/19/16

Health – Affordable Care Act
Aetna withdraws from Obamacare individual marketplace in Illinois. The withdrawal follows the financial failure of ACA cooperative Land of Lincoln Health, and leaves an increased number of Illinois counties where only one or two health insurance providers are willing to participate in the marketplace. Aetna announced its departure from marketplaces in Illinois and 10 other U.S. states on Tuesday, August 16. The withdrawal from the ACA insurance marketplace could affect as many as 838,000 exchange enrollees nationwide.

The financial failure or withdrawal of many insurance providers from ACA-related marketplaces nationwide has added to concerns about the challenges facing individual customers for U.S.-based health insurance plans. With competition substantially weakened or even absent in many American localities, many persons required by law to comply with the health insurance mandates of the federal ACA law many find themselves facing much higher prices for insurance policies. In many states, including Illinois, remaining health insurance care providers are demanding double-digit premium increases as a condition for meeting their fast-growing expenses and remaining as active suppliers to customers in health insurance markets.

Budget – New Borrowing Planned
Illinois taking steps to sell $573 million in bonds for capital infrastructure. Scheduled to go to market next week, the new securities will feature a variety of maturity dates and interest rates.

One significant feature of the August 2016 bond sale is that the new securities will not be Illinois “general obligation” (GO) bonds, which are encumbered by the overall poor credit rating of the State. Instead, these securities are directly backed by the sales tax revenues of the State. Under the Build Illinois Act and related State laws, a subset of Illinois’ bonds get “first call” on Illinois’ sales taxes even before most of these sales-tax revenues are placed in general revenues. Not surprisingly, this creditor-favorable feature of the loan covenant means that the bonds are granted a healthy, high-level investment grade. Fitch Ratings has ranked this month’s sales-tax-backed tranche of Illinois bonds at AA-plus, only a notch below the highest AAA rating. By contrast, Fitch currently ranks Illinois’ GO debt at BBB-plus with a negative outlook, only a few steps above the dreaded “junk bond” level of BB or less. 

It is likely that if this month’s bond sale is consummated, the sales tax-backed debts will be sold for very low rates of interest paid by future Illinois taxpayers. Much of the new debt is classified as Build Illinois rollover debt. As with Illinois bonds sold under the Build Illinois law since the start of the program under former Gov. Jim Thompson, the bond proceeds will be used for purposes of refinancing and capital projects. As with other Illinois debts, the bonds to be sold this month will be part of the overall obligations owed by the people of Illinois.

Economy – Illinois Tourism
Tourists spent $37 billion in Illinois in 2015. The new numbers come from the Illinois Office of Tourism, which monitors visitor spending in Illinois as a way of gauging a return on investments for the money from hotel/motel taxes spent to promote Illinois to out-of-staters. Estimated expenditures by tourists in Illinois were $37 billion in 2015, up an inflation-beating 2.6% from 2014.

According to the Office of Tourism, an arm of the Illinois Department of Commerce and Economic Opportunity, tourism generated an estimated 10,000 new Illinois jobs in 2015. Job creation is featured in the Office of Tourism’s “Illinois Made” campaign for 2016, a multimedia promotion that centers on the attractive opportunities for visitors to buy goods and services produced by Illinois craftspeople and small businesses.

Education – Illinois High Schools
List of nation’s top-500 high schools includes 24 from Illinois. The public schools were ranked by Newsweek on the basis of state testing performance, graduation rates, college readiness, college preparation, and the student body’s household income as measured by the percentage of students from a background of poverty. Illinois stood out among states from the U.S. Midwest, with 8 of the top 10 high schools coming from co-called “coastal” states on the U.S. East and West Coasts.

The 24 high-performing Illinois high schools were located in Chicago, the suburbs, and in Downstate Illinois. Ranked No. 8 nationwide, the Chicago-based limited admission Northside College Prep led the list of Illinois public high schools. Northside was the highest-ranking school not on the East or West Coast. The highest-ranking Illinois suburban public high school was New Trier High on Chicago’s North Shore, which was ranked #17 nationwide. The list of Downstate schools granted recognition was led by Galena High School in historic Jo Daviess County, Illinois. Two school districts placed more than one high school on the list of 24, with the south suburban Lincoln-Way district placing both Lincoln-Way Central and Lincoln-Way West on the list.

Elections – Automatic Voter Registration
Governor Bruce Rauner vetoes bill. SB 250 would have altered a fundamental feature of Illinois election law. For decades, Illinois election law has given each potential voter the responsibility to signal his or her readiness to cast an informed ballot by taking the small step of registering to vote. Status of a registered voter signals a readiness to vote and means that the election judges will know who the registered voter is on Election Day.

SB 250, a bill passed by the General Assembly in spring 2016, would have changed this guiding principle. Arguing that they wanted to make voting easier, the sponsors of this measure said they wanted to make contacts between Illinois residents and designated government agencies into an automatic pathway to voting status for unregistered Illinoisans. Designated agencies, such as driver-service offices of the Illinois Secretary of State’s office, would have been directed to use each agency-client contact with a member of the public to ask the Illinois resident if he or she was registered to vote. If the resident was not registered, the agency would have been directed to help the client register. State agencies would have become voter-registration stations, and the agencies would have been directed to forward the names of new voters to the State Board of Elections.

Many House Republicans were concerned about this measure in spring 2016 because of the potential for voter fraud and the administrative challenge of imposing the additional duties of automatic voter registration on often-understaffed and burdened State offices. When the measure came up for a vote in the House in May, it passed by a contested count of 86-30-0. The measure was sent to Gov. Bruce Rauner, who vetoed it on Friday, August 12. In his veto measure, the Governor said that he supports the concept of automatic voter registration, but he shares many of the implementation concerns raised by Illinois House Republican members in the debate over the bill.

As a vetoed Senate bill, the measure now goes back to the Senate for possible further action. The chief sponsors of the bill could move to override the Governor’s veto of the bill in November 2016, during the so-called “veto session” of the Illinois House and Senate, or could negotiate with the Governor over these implementation concerns. In some cases of bills on the veto calendar, no motion is made to override and fresh legislation is prepared. The fresh language can include many of the concepts in the original bill, to which have been added additional amended language and modifications.

Energy – Wind Farms
New Illinois law extends tax assessment formula for wind turbines. Illinois wind turbines are now a familiar sight throughout many parts of Downstate Illinois. The state’s attractiveness as a potential location for wind farm investments was enhanced by a law passed in 2007 that creates a formula for local property tax assessors to use in assessing wind turbine arrays. At the beginning of this year, the assessment law applied to assessment years through 2016, creating potential uncertainty for new Illinois wind farm investment in 2017 and following years.

Rep. Tom Demmer took action this spring to protect Illinois’ status as a place for long-term wind infrastructure investment. SB 2612 extends the life of the current wind power assessment formula and methodology for another five years, through assessment year 2021. The bill was signed into law by Gov. Bruce Rauner of Tuesday, August 16. “This helps communities and businesses plan for the future,” commented Demmer. The lawmaker pointed to the increasing number of wind energy employees in his district and other locations throughout Downstate Illinois.

Health Care – Sepsis
“Gabby’s Law” will require hospitals to be better prepared to treat sepsis. Governor Bruce Rauner, at a press conference Thursday at Presence Covenant Medical Center in Urbana, signed Senate Bill 2403, known as Gabby’s Law, to require Illinois hospitals to be better prepared to recognize and treat patients with sepsis or septic shock.

The legislation is named in honor of Gabby Galbo of Monticello, who passed away in 2012 due to untreated sepsis. Following her death, Gabby’s parents, Liz and Tony, began work to pass this legislation, which received unanimous support in both the Senate and the House, to honor her memory.

“This bill is an example of good public policy, policy that will save lives,” said Governor Rauner. “But we are saddened, because it was due to the loss of 5-year-old Gabby Galbo that this legislation was sent my desk. Gabby’s Law will save lives while honoring this little girl's legacy. It will have a tremendous impact in Illinois for years to come.”

SB 2403 requires hospitals to adopt evidence-based protocols for the early recognition and treatment of patients with sepsis, severe sepsis, or septic shock that are based on generally accepted standards of care. It requires the protocols contain certain components, including those specific to identifying and treating adults and children.

“This legislation honors Gabby Galbo and her family by improving the quality of care for all Illinoisans and sheds light on this deadly condition,” said State Sen. Chapin Rose (R-Mahomet), Senate sponsor of the legislation. “Early detection saves lives. If we can prevent just one family from having to deal with the pain that the Galbo family has gone through, then this law will have honored Gabby’s memory well.”

“I’d like to thank the Governor for being here today to sign Gabby’s Law. I also want to thank the Galbo family for bringing awareness to this issue and for showing great strength in their testimony to the House earlier this year,” said State Rep. Bill Mitchell (R-Forsyth), House sponsor of the legislation. “Illinois hospitals need to implement sepsis protocols to help ensure that no other family has to go through the pain and loss the Galbos suffered. We are hopeful that Gabby’s Law will help advance medical treatment to prevent sepsis deaths.”

According to the Centers for Disease Control, each year more than 250,000 Americans die from sepsis - and the disease leaves thousands of survivors with life-altering after effects.

Video of the event is posted here.

Illinois State Fair
New private foundation will cooperate with State of Illinois to preserve threatened fairgrounds. As the Illinois State Fair of 2016 moved towards its scheduled close on Sunday, August 21, Gov. Bruce Rauner applauded the creation of a private foundation to rebuild the crumbling infrastructure that supports Illinois’ largest summer gathering.

“The State Fair is the best place for Illinois to show off its products and accomplishments, and to ensure we can continue to do that, so that our children and grandchildren can continue on with this same tradition, we must preserve the State Fair experience and the legacy of its entertainment for generations to come,” said Governor Rauner. “A foundation is the best way to ensure that the fairgrounds get the upgrades and renovations necessary for these important assets. And it allows the fairgrounds to be less reliant on state money while putting no additional costs on the taxpayers. This is a win for taxpayers and the agricultural community as a whole.”

With an estimated $180 million in deferred maintenance costs, the more than 190 buildings of the Illinois State Fairgrounds in Springfield and the DuQuoin State Fair in Southern Illinois’ DuQuoin will require massive rebuilding to maintain a safe and secure fairgoing experience. Electrical, paint, plumbing, roofing, and structural repairs must be done on buildings that were built as long ago as 1892.

Gov. Rauner has led the push to create the new Illinois Fairgrounds Foundation, announced on Sunday, August 14. Established by private-sector leaders of the agricultural community, the foundation will raise private funding and coordinate the revitalization and improvement of both fairgrounds. It is expected that large donors may receive recognition for their generosity in the form of sponsorship opportunities that will be seen by the hundreds of thousands of annual visitors to the Fairs and their grounds. Creation of the Foundation was the culmination of a push to save the State Fairgrounds led by Rep. Tim Butler and by former Rep. Raymond Poe, both of Springfield. Former Rep. Poe is currently the Director of the Illinois Department of Agriculture, the State agency with overall responsibility over the State fairgrounds and state fair infrastructure.

Jobs – Illinois Unemployment Rate
Few new jobs created, but State unemployment rate drops to 5.8%. The July 2016 figures from the Illinois Department of Employment Security (IDES) indicate a net creation of 11,600 nonfarm payroll jobs in July 2016. This marked an increase in net Illinois payroll jobs of only 0.2% over the previous month, June 2016, and a payroll count up only 0.7% from 12 months earlier. This increase continues to be significantly slower than the rate of job creation in other U.S. states.

In a bright spot, the IDES July 2016 jobs report showed a decline in the most-frequently-quoted index of Illinois unemployment. The “U-3” Illinois unemployment rate, which does not include discouraged workers and work-aged individuals who have dropped out of the labor force, declined from 6.2% in June 2016 to 5.8% in July, a drop of 40 basis points. Illinois’ July 2016 U-3 unemployment rate continued to be significantly higher than the national jobless rate of 4.9%. Illinois July 2016 job losses were concentrated in the sectors of construction, financial activities, and manufacturing. Educational, health services, leisure, and hospitality continued to be bright spot in the overall Illinois economy, with 7,500 new jobs created in this sector in July. The IDES report was released on Thursday, August 18.

Transportation – Illinois Traffic Fatalities
Current rate of traffic deaths show fatalities mounting to projected eight-year high in 2016. Based on current statistical trends, more than 1,000 people will be killed on Illinois roads and highways in 2016. The dismal number is attributed by traffic experts to higher speeds, with speed limits up to 70 mph on many sections of Illinois limited-access highways. An increase in the total number of Illinois miles driven and a larger number of younger drivers are also blamed.

The 1,000-death projection is based upon the 629 Illinois traffic deaths that had been logged as of Friday, August 12 by the National Safety Council, a private-sector entity that works with local law enforcement and health providers to track accidents and injuries nationwide, including motor vehicle incidents. The Council has, in the past, played a key role in injury-reducing changes to motor vehicle law, including mandatory child restraints and a standardized law to identify and sanction persons who drive under the influence.

Governor signs bills honoring Gold Star Families, increasing services to Illinois veterans. Governor Bruce Rauner on Sunday, took action on several bills as part of Veterans Day at the 2016 Illinois State Fair. The bills strengthen Illinois’ commitment to our veterans and their families by providing needed assistance and honor to those who have sacrificed so much for our country and our state.

“The selflessness of our American heroes can never truly be repaid, but here in Illinois we are making it easier for our men and women to return home and have prosperous futures,” said Governor Rauner. “We are investing in our veterans’ futures while never forgetting those we have lost along the way.

Two of the bills support the families of our Illinois veterans. HB 4389, sponsored by Rep. Steven Andersson, designates the day after Gold Star Mother’s Day as Gold Star Family Day to be observed throughout the Illinois as a day to honor and commemorate the families of men and women who gave their lives while serving with the armed forces of the United States. HB 4432, sponsored by Rep. Don Moffitt, allows a child in any grades 6 through 12 to be absent from a public school for the purpose of sounding “Taps” at a military honor funeral held in Illinois for a deceased veteran. Read more about HB 4389 and HB 4432.

HB 4344, sponsored by Rep. Mark Batinick, creates the Heroes Way Designation Program Act. It is a way to honor servicemembers who were killed in action by allowing a relative to apply to have an honorary sign with the name of the servicemember erected along designated Illinois roads.

“Our Gold Star Families have made the ultimate sacrifice for the people of this country. They have lost their loved ones in service to our nation. That loss and their resilience should be remembered and honored every single year,” Governor Rauner added.

The Governor also signed bills to assist veterans’ transition from military life to life as a civilian and increase the level of care within Veterans’ Homes.

Read more about these and other new laws affecting veterans at The Caucus Blog.

Week in Review
Get the Week in Review emailed directly to your inbox! Sign up today to get a first-hand look at the continuing legislative and fiscal challenges facing policymakers in Springfield.