IL General Assembly Adjourns, Fails To Pass Budget

The IL General Assembly has adjourned but their work is not done because of their  failure to pass a state budget. Lawmakers plan to return to the Capitol sporadically during the month of June to try and finally resolve the historic impasse spanning more than 700 days.

IL, the nation’s fifth-largest state, has been limping toward the June 30 end of its second-consecutive fiscal year operating under court-ordered spending, stopgap spending, and ongoing appropriations mandated by law.

During the ongoing two-year budget impasse,  the state’s backlog of bills has continued to spiral out of control and now exceeds $14 billion. Legislative leadership has indicated that negotiations will continue throughout June with legislators returning to the Capitol on occasion with the goal of passing a budget before the start of the state’s fiscal year on July 1. It will now take a supermajority three-fifths vote to pass legislation with an immediate effective date.

Walker Signs WI High Capacity Well Bill

WI Gov. Scott Walker has signed into law (2017 Wisconsin Act 10) a bill relaxing regulations on high-capacity wells used by vegetable growers, food processors and dairies along with other large businesses.

The new law exempts well repairs, replacements, reconstructions and ownership transfers from WI Department of Natural Resources (DNR) oversight. It also would require the DNR to study lakes and streams in the central sands region to determine whether special measures are needed to protect ground and surface waters from depletion.

MWFPA supported this legislation as it provides regulatory certainty for farmers who rely on high-capacity wells to irrigate their crops and hydrate livestock.  Other organizations supporting the legislation are the Wisconsin Farm Bureau Federation, the Wisconsin Corn Growers Association and the Wisconsin Potato and Vegetable Growers Association.

IL House Approves Minimum Wage Increase

The IL House has approved a proposal raising the state’s minimum wage to $15 an hour over five years.  It is not clear whether GOP Gov. Rauner will sign the measure.  He had previously indicated a willingness to support an increase in the minimum wage should other regulatory changes be made.

IL’s minimum wage is currently $8.25.  Under the bill passed, workers age 18 and over would see the wage increase in increments through 2022.  The plan also includes a tax credit for businesses with 50 or fewer employees.

MWFPA opposed the measure.  This increase, when fully phased in, would represent an 82 percent increase and make the state’s wage the highest in the nation.

Minimum Wage Hike Clears IL House Committee

The IL House Labor Committee on Sunday passed a minimum wage increase in the state and the bill is expected to heard on the House floor before lawmakers adjourn on Wednesday.

The measure, sponsored by Representative Will Guzzardi, would raise the minimum wage to $15 an hour by 2022.  According to a report from the National Federation of Independent Businesses Research Center, raising the state’s minimum wage to $15 an hour would lead to 93,000 fewer jobs across Illinois by 2027. The report also shows that raising the minimum wage will reduce the state’s production output by more than $56 billion over a 10-year period.  MWFPA opposes government imposed wage mandates.

What Tax Credits Did To Manufacturing Jobs In Wisconsin

In 2011 the Wisconsin state legislature adopted the Manufacturing and Agriculture Credit (MAC). Phased in from 2013-2016, the MAC now nearly eliminates the state tax liability for manufacturing and agricultural businesses.  A recently completed study by Noah Williams, an economics professor at the Center for Research on the Wisconsin Economy at the University of Wisconsin – Madison, suggests that the reductions in taxes on manufacturing led to substantial job growth that spilled over to the broader economy.  Read more from Forbes online.

IL Minimum Wage Bill To Be Considered Sunday

In IL a minimum wage proposal has been filed as an amendment to SB 81 (Guzzardi, D-Chicago) and will be considered in the House Labor Committee on Sunday afternoon.

The new proposal creates a dual minimum wage system for employees based on age with different wage levels. Employees who are who 18 years of age and older will get a $15 per hour minimum wage phased on over five years while younger employers who have worked less than 650 hours will see their wages increase to $12 per hour over the same time period.

Currently the IL minimum wage is $8.25 and this increase, when fully phased in, would represent an 82 percent increase and make the state’s wage the highest in the nation.

The schedules are as follows:

 

Date

18 years or older or 18 years and younger with more than 650 hours of work Younger than 18 years with less than 650 hours of work
January 1, 2018 $9.00 $8.00
January 1, 2019 $10.00 $8.50
January 1, 2020 $11.25 $9.25
January 1, 2021 $13.00 $10.50
January 1, 2022 $15.00 $12.00

For the first time, legislators recognized publicly that an increased minimum wage is a costly mandate for employers and created a tax credit for small employers with less than 50 employees. The decreasing credit starts at 25 percent and slowly phases out over the same five-year period of time. An employer is not eligible for the credit unless the average wage paid by the employer per employee for all employees making less than $55,000 during the reporting period is greater than the average wage paid by the employer per employee for all employees making less than $55,000 during the same reporting period of the previous year. In essence, an employer who is forced to reduce hours because of the increased payroll cost will likely not be able to claim the tax credit.

MWFPA opposes government imposed wage mandates.   Thanks to the IL Manufacturing Association for the information presented here.