End of Session Report
Bill Ward, Exec. VP
Home Builders Assoc. of Illinois
The Illinois General Assembly (GA) adjourned after holding a truncated 4-day session to wrap up a Spring Session that never really happened. Like most other things, the GA shut down for business in Mid-March due to the COVID-19 Pandemic and remained closed until they abruptly came back to address a few essential issues and pass a budget that has an estimated $5 billion shortfall for 2021. The plan, from what I have read, is to borrow $5 billion from the federal government and have it repaid by the federal government.
The GA will be adjourned until they return for Veto Session in late November. Legislators speculate the Veto Session will be extended to address some issues left on the table this Spring and new issues arising out of the Pandemic. Below is a review of the issues we were following.
Work Comp & COVID-19
In April, Governor JB Pritzker directed the Illinois Workers Compensation Commission to deem the COVID-19 Virus as a rebuttable disease presumed to have risen out of employment. All businesses deemed “Essential” under the March Executive Order would be burdened with an extraordinary presumption standard whereby workers claiming to have the virus could receive Work Comp benefits with very little recourse allowed for the employer.
Work Comp claims were being forecast to rise from $4 billion in 2019 to $12 billion in 2020. Illinois employers would be shackled with a 300% increase in Work Comp insurance premiums.
Business groups filed for a temporary restraining order a week later in Sangamon County Circuit Court and the presiding judge ruled favorably (for us) that the new administrative rule may not have been passed according to State Statute and should be held from being initiated. The Governor then dropped the issue and waited until our late May session to address the issue with business and labor groups both at the table.
Negotiations for (delete “for”) took place during the 4-day session with agreed language being placed onto HB2445. HB2445 provides new protections for essential workers who contract COVID-19. It also contains several concessions for employers to make the law more practical and affordable.
All workers employed by businesses deemed “essential” during the shutdown are to be covered for COVID-19. But business groups made some very important restrictions to the standard set forth by organized labor. They include:
- Workers must have direct association with the public.
- There must be over 15 workers at a workplace to make a claim.
- Ordinary Presumption Standard (not Rebuttable Standard) would be in place allowing employers an opportunity to dispute the claim.
- A Positive Test or a Doctor’s Statement is needed to prove the employee has the virus.
- Coverage for COVID-19 claims sunsets at the end of the calendar year.
With these important modifications, the bill has passed both Houses and awaits action by the Governor. The Senate vote went 50-4 in favor, and the House vote was 113-2.
Rent & Mortgage Cancellation
SB3066 was an attempt by Chicago Democrats to allow homeowners and renters to cancel (not defer) rent & mortgage payments for 6 months by merely declaring hardship due to COVID-19. This bill was also negotiated during the 4-day session but without resolution and without final passage.
The Realtors led the opposition backed by the banking industry, the Home Builders, Building Owners and Managers Association, Chicagoland Apartment Association, and many others. Witness slips for committee debate were in the hundreds, both for and against the bill. Language was offered by opponents to pare down SB3066 that included:
- Payments would be deferred, not cancelled.
- Renters & homeowners must prove they have the virus.
- Raise the ceiling on eviction actions.
The two sides were unable to reach a compromise and so the bill was laid to rest for now. We will be watching out for more legislation this Fall or next Spring that will address this issue and its close issue-cousin, rent control.
SB2135 codifies remote notarizations for legal documents and sets guidelines for their use. Designed to reduce public exposure during the pandemic, the process to transfer property can now be completed entirely from remote locations. The Home Builders supported this bill which passed both Houses and awaits action by the Governor.
Property Tax Late Payment Waiver
Legislation has passed the GA permitting all counties (excluding Cook) to waive some or all penalties for the payment of delinquent property taxes. This bill is permissive, and each county board will elect whether to provide a waiver or not. The 2019 property taxes must still be paid but there will be a period of 120 days after the immediate effective date of the bill or until the first day of the first month during which there is no longer a statewide COVID-19 public health emergency, that property tax payers may make late payments without penalty. SB685 awaits action by the Governor.
A New Chicago Casino Bill
Legislation was passed last year allowing a gambling casino to be built in Chicago. However, the fees and regulations tied to the placement, construction, and operation of the casino were so burdensome that no casino company would risk locating in the Midwest’s largest city.
Through a display of bipartisan effort, legislation passed allowing a new casino with better terms for the owner(s). The casino owners will have more authority over the placement of the casino and the taxes and fees will be less burdensome. 50% of the taxes and fees collected from the casino will go to the City of Chicago to be used for pension payments. The state receives the other 50% and it will go toward public infrastructure improvements like roads and bridges throughout Illinois. This legislation passed the GA and awaits the Governor’s action.
SB1596 was the Omnibus School bill; education received “flat funding” for FY2021, meaning there will be no new monies for public education over FY2020.
SB1857 closes all schools for election day, a move to provide better safety for school children where school buildings are being used for polling places. This law sunsets after 2020.
Retired Substitute Teachers will be allowed to work 120 days without risk of losing their pensions.
And, 16-year-olds and up will be allowed to work at polling places on election day.
Legislation Held from Final Consideration
Here are some of the bills that failed to complete final action during the 4-day session.
HB4284 (Gabel) Would have mandated all parking spaces in a new single-family home to be equipped with electric car chargers. For example, builders constructing a 3-car garage on a new home would need to equip the garage with 3 outlets for electric car charging. Multi-family construction would have been required to provide ready and equipped car chargers for 20% of all parking spaces. HBAI opposed this measure and it was not considered for passage in the 4-day session.
HB3851 (Bourne) and HB4069 (Stuart) would have lowered light trailer license fees from $118 to $18. The GA raised it to $118 last year. HBAI supported these bills but neither bill received committee or floor consideration.
SB1379 (Harmon/Davis) would have expanded the assessment of property for the purposes of taxation to include the building’s income production. This change in the tax code could have raised property taxes on income producing buildings by a large, yet undetermined amount. HBAI opposed.
HB4121 (Denmer) would have allowed all counties in Illinois to discontinue the powers and duties of township government through board and voter referendum approval. HBAI supported this bill.
SB3427 (Crowe) would have expanded the time subcontractors have to file a lien from 4 months after they complete their own work to 4 months after the entire project is complete. HBAI has opposed this bill and it remained in the Senate.
SB3227 (Fine) Would have allowed all non-home rule government units to collect taxes on the transfer of real estate. Current law allows only home rule units to collect property transfer taxes. HBAI opposed this measure.
SB3447 (Fine) Would have created a statewide Wetlands Protection Act that would have given I-EPA an unusually high amount of authority for determining the definition of a wetland and the regulations to protect them. HBAI opposed.
SB3452 (Weaver) Would have allowed tax breaks for remodeling homes in areas deemed to be an “area of decay.” HBAI supported this bill.
I would like to thank everyone on the HBAI Legislative Committee for their efforts in guiding our association through these various complicated issues. Although our session was greatly shortened, a lot of work was put in prior to mid-March to protect the home building and remodeling industries.
If you have any questions or concerns regarding any of these bills feel free to contact me at email@example.com.