Illinois Department of Revenue Estimates SB 1719 Would Raise $1.7 Billion for State in First 12 Months
Chicago, IL – On Tuesday, May 23rd, the Illinois Senate voted 34-24-1 in favor of passing SB 1719. The legislation places a privilege tax on Hedge Fund and Private Equity Managers like Bruce Rauner and Ken Griffin who exploit a federal tax loophole to get a lower tax rate than that paid by many working Americans.
Amisha Patel, Executive Director of Grassroots Collaborative, explained, “This is great news for Illinois residents that have been languishing under an extended budget impasse. Illinois needs new revenue. SB 1719 generates significant revenue – raising it from those who have profited for years off of a rigged tax system, instead of asking for more sacrifices from our most vulnerable residents.”
“This is an important step in creating the kind of state we want to live in,” stated Senator Daniel Biss (D-Evanston), lead sponsor of SB 1719. “We have a small group of very wealthy individuals using an archaic loophole to avoid paying their share, at the expense of other taxpayers and vital social services. Illinois now has an opportunity to right this wrong, to move towards greater fairness, and raise $1.7 billion in new annual revenue that our state desperately needs.”
Representative Welch (D-Hillside), lead sponsor of the legislation in the Illinois House added, “I believe that to those whom much is given much is required- and so far Illinois Hedge Funds have given very little and taken an awful lot. At a time when our seniors are being asked to go without, our public universities are at risk, and shelters are being shut down we can not afford to wait. I’m looking forward to working with my colleagues in the House to quickly pass this legislation and get it on the Governor’s desk.”
“The people that make the most of this loophole will not change their line of work if it is eliminated. They make plenty of money with or without it, and the tax advantage that they receive due to this rule is not the reason they are in it. They are in the business because they make a ton of money doing it. And that is OK. But the absurd advantage they receive due to this rule is just that; absurd! So simply change the law so that it treats them the same way that John Q Public is treated…or myself, I might add, who paid in last year at a 38% rate (happily so) on a pretty good number,” concluded Stephen Prince with the Patriotic Millionaires, CEO of Sterling Card Solutions.
On Thursday, the Illinois Trust Act passed out of the Illinois Senate with a 31-21 vote.
From Illinois Patch:
The Illinois Senate passed a bill aimed at encouraging cooperation between undocumented immigrants and state law enforcement agencies while discouraging unwarranted cooperation between federal immigration. The Trust Act, sponsored by Senate President John Cullerton (D-Chicago), passed 31-21 Thursday and will be taken up by the House this week.
“If someone is going to be detained in Illinois it should be because an actual crime has occurred, not because of how they look, what they believe or what paperwork they may or may not have,” said Cullerton.
The Senate proposal, SB31, would ban the detention of immigrants in local jails by federal authorities without criminal warrants, stop federal agents from arresting people inside state-funded school or health care facilities, and bar any local participating in a federal immigrant or religious registry. The bill would also strengthen legal protections for immigrant victims of crimes.
Community Groups Demand Hedge Fund Managers Profiting From Carried Interest Loophole Pay Fair Share to Help Solve State Budget Crisis
Chicago, IL – On Thursday, community residents being impacted by the school funding crisis and state budget impasse took part in a Tax Evasion Trolley Tour to the homes of Hedge Fund political donors who have profited off of the carried interest loophole at the expense of schools and vital social services.
The first stop on the trolley tour was the $20 million dollar home of Donald Wilson, founder of DRW Trading Group. Wilson has personally benefited from the carried interest loophole and made significant political contributions to both Governor Rauner and Chicago Mayor Emanuel. Participants were joined by Representative Welch (D-Hillside), lead sponsor of HB 3393, a bill that would generate close to a half billion dollars by placing a privilege tax on people like Wilson.
Joining with community members, Representative Welch hand-delivered a large overdue tax bill to Wilson’s front door.
“It’s okay to own a nice home, everyone dreams of being successful and living a good life. But to those who much is given, much is required. What we are saying is if you have the privilege to live in a $20 million dollar house you should pay your fair share in taxes and that means closing the carried interest loophole,” stated Representative Welch to the energetic crowd.
Alejandro Sanchez, Safe Passage program coordinator with the Brighton Park Neighborhood Council added, “In our community, shootings have increased by 300% between 2013 and 2016. I have a question for Don Wilson and others like him who are profiting off of this loophole. Do you think that skimping on your tax bill is worth students in Brighton Park losing their after-school programs and guidance counselors, or domestic violence centers being closed, or more young people dead because of massive disinvestment in anti-violence programs?”
Participants left sidewalk messages outside Wilson’s home, citing the devastation caused by the state’s lack of sufficient revenue. In addition to visiting Donald Wilson, the Tax Evasion Trolley Tour went to the homes of Sam Zell, Ken Griffin, and Dmitry Balyasny, all deep-pocketed political donors who have capitalized on a rigged tax system resulting in the current school and state funding crisis.
“The impacts on our communities are real – increasing violence, students forced to stop their college educations, seniors going without home care and needed programs like meals on meals, immigrant families losing programs that assist them, and the prospect of our schools being closed 3 weeks early, due to lack of revenue. We organized this tour because these impacts feel real to us, but standing here in front of multi-million dollar mansions, it’s hard to imagine they feel real to these Hedge Fund managers. We want them to know that the money they are getting from the carried interest loophole isn’t being pulled from thin air – it is coming from our community programs and schools,” explained Abbie Illenberger, Field Director of Grassroots Collaborative.
Grassroots Collaborative expects HB 3393 to be voted on in the Illinois House next week.
Photos from the Tax Evasion Trolley Tour can be found here: https://www.dropbox.com/sh/ac8iwhjl3y50a2f/AABXPqa9Nd1lNJyrmysLIzMha?dl=0
The Illinois Senate Executive Committee took an important step today toward making our state safer for immigrants and their families. The TRUST Act (SB-31J), filed by Senate President Cullerton, passed through the committee with 11 members voting in favor, five voting present, and no opposing votes. The bill creates a bright line between local police and federal immigration agents, and sends a message to Illinois’ immigrant residents that seeking police assistance will not result in their deportation.
The bill is a rebuke to the Trump administration’s xenophobic federal immigration policies that waste local law enforcement resources and create distrust between communities and local police. Representatives from immigrant, refugee, labor and domestic violence organizations spoke at the noon hearing today on key issues in the bill, which is slated to have a full senate vote within the week.
The TRUST Act’s main provisions will:
Bar federal immigration agents from schools and health facilities if they do not have a warrant,
Bar local law enforcement from engaging in immigration enforcement without a court-issued warrant,
Assist immigrant crime victims seeking legal protection, and Bar local participation in a federal registry based on country of origin or religion.
“This is a major step forward for our coalition leaders, who have worked tirelessly on our Campaign for a Welcoming Illinois.” said Lawrence Benito, chief executive officer at Illinois Coalition for Immigrant and Refugee Rights, one of the lead sponsors of the TRUST Act. “There is an immediate need for our elected officials to listen to our leaders and take action at the state level to keep communities safe and protected from these vicious threats and attacks on our rights.”
“We must all work together to help make our communities safer for everyone,” said Trisha Teofilo Olave, senior legal supervisor at Chicago’s National Immigrant Justice Center. “The TRUST Act would standardize the U visa certification process to create consistency for immigrant victims of crime and demystify the process for law enforcement agencies. It would help law enforcement comply with federal law, while also enhancing community trust and public safety.”
“Our communities are living in fear and facing threats to their livelihoods every day,” said Andy Kang, legal director at Asian Americans Advancing Justice-Chicago. “Illinois has the potential to be the most welcoming state for immigrants and refugees. Passing the TRUST Act would be a move in the direction of protecting our communities, and making sure they are safe.”
The bill is expected to reach the Senate floor soon. A broad coalition of community organizations are planning actions and scheduling in-district meetings during the upcoming spring legislative recess, to ensure the Illinois TRUST Act is passed through both the Illinois senate and the house this spring.
More exciting news, bill to raise the state of Illinois minimum wage to $15, HB 198, passed out of the House Labor and Commerce Committee and now waits for a vote on the Illinois House floor.
From the Chicago Tribune:
The House Labor and Commerce Committee voted 17 to 6 to recommend HB 198, which would increase the state’s hourly minimum wage from its current level of $8.25 to $15 by 2022. The first increase, to $9 an hour, would go into effect Jan. 1.
About 40 percent of Illinois residents earn less than $15 an hour.
The bill now heads to the full House for a vote and then to the Senate. Guzzardi said he feels confident it will arrive at Gov. Bruce Rauner’s desk, but the Republican governor’s support is a long shot. Rauner has stated his support for a smaller wage hike over a longer period.
Northbrook business panel asks village to opt out of minimum wage law
Northbrook business panel asks village to opt out of minimum wage law
Chicago, which approved a minimum wage hike in 2014, is on its way to $13 by 2019. Cook County, which approved a hike last year, is scheduled to reach $13 by 2020, though several suburban towns have opted out.
If the state law is adopted, Chicago and Cook County would have to comply with the $15 target and communities won’t be able to opt out, Guzzardi’s office said.
Local and state governments approved a wave of minimum wage increases last year, including to $15 in New York, California and Washington, D.C. But there is continued debate about the economic consequences. In Baltimore last month, the mayor vetoed a $15 minimum wage bill.
On Wednesday, March 22, Brighton Park Neighborhood Council (BPNC), Chicago Teachers Union (CTU) and Grassroots Collaborative brought the People’s Agenda, a set of bills aimed at reinvesting in the People of Illinois, to the state capitol.
On this trip to Springfield our main goal was to meet with Illinois House members and ask that they co-sponsor the Violence Prevention Act (HB3166—Rep. Stratton), a comprehensive bill to prioritize five key areas of investment in order to stem the violence escalating in communities: street intervention programming, youth jobs, after school program investment, trauma-informed care, and supports for those in contact with the criminal justice system. Our meetings with legislators were productive, we gained 6 co-sponsors, including Elizabeth Hernandez (D-24), La Shawn K. Ford (D-8), Robert Martwick (D-19), Marcus C. Evans Jr. (D-33), Justin Slaughter (D-27), and Will Guzzardi (D-39).
On the bus to Springfield, Berenice Flores and Ebonee Stevenson, community organizers with BPNC and Grassroots Collaborative respectively, facilitated a Spanish and English training for our intergenerational group of 23 people on why we’re talking with our representatives and how to go about doing so.
“We are parents from different neighborhoods,” said Flores, and the “lack of resources there are for our kids is why we’re here.”
Stevenson added, “so we can stop begging for crumbs and start getting what our communities really need.” She encouraged folks, “If you see legislators who you want to talk to, don’t be afraid to speak. This is our show. We are fighting for our babies.”
9-year-old Sonya Sifore said, “It felt really good to lobby because I knew I was fighting for my rights and other people’s rights. I feel great that I got a representative to represent our state Illinois.”
Andres Barrera, BPNC member, said, “I felt as though the work that was done today was important but often neglected. We often hear about how only these rich corporations often lobby to get their point or law across but we often forget that we also have the power. It was interesting to meet the people who pass these laws that directly affect me and my community.”
Above all, our group expressed gratitude and concern. BPNC member Marivel Miranda said:
Es un gusto estar en este recinto en nuestro estado Illinois. Fue muy satisfactorio por el echo de que algunos de nuestro representantes nos apollaron en nuestros propositos, sobretodo en la violencia en nuestra ciuda de Chicago IL; mi mallor preocupación es tontas muertes de niños en los calles. Ojala este viaje nos sirva como comunidad para parar esta que esta afectando a tantos jovenes de nuestra ciudad y de nuestros barrios. Brighton Park es una comunidad que a sido muy afectada en todo, como lo mencionadado antenormente, como con los recortes en nuestras escuelas, que cada una de nuestras escuelas son templos de la enseñanza para nuestro hijos y futuros hombres y mujeres de vien en nuetra ciudad.
It’s a pleasure to be in our state of Illinois. It was very gratifying because some of our representatives supported our purpose, especially around addressing the increased violence in our state. My biggest concern is deaths of children in the streets. I hope this trip will serve our community, to stop this from affecting so many young people of our city and our neighborhoods. Brighton Park is a community that has been very affected in everything, as mentioned above, as with the cuts in our schools. Our schools are temples of teaching for our children and future men and women from around the city.
On Thursday, March 23rd, the Illinois House Revenue Committee passed HB 3393 7 to 4.
Part of the Illinois People’s Agenda Legislative Platform, HB 3393 would put a “privilege” tax on Wall Street Money Managers who exploit the federal carried interest tax loophole. Conservative estimates predict this tax would generate $473 million a year for the state of Illinois, money our state needs to pay for vital programs and services.
Following its passage out of the House Revenue Committee, HB 3393 now waits for a full vote on the House Floor.
On March 10th, International Women’s Day, Representative Will Guzzardi introduced HB4004 to raise $924 million by closing nine corporate tax loopholes. Illinois’ backlog of unpaid bills has grown to $11 billion and the general fund’s deficit is now $9.5 billion. Budget cuts have a disproportionate impact on women — denying them opportunity to go to college, failing to support female caregivers, robbing female seniors of independence and dignity, endangering women’s safety, and increasing poverty and homelessness among women.
“It’s a moral failure that we’re letting the neediest among us suffer while huge corporations game the system to boost their profits,” said Rep. Guzzardi. “The nearly $1 billion dollars of loopholes we can close will take taxpayer money back from the corporate special interests and invest it where it belongs: in the people of Illinois, in our schools and roads and neighborhoods.”
The bill proposes:
- Taxing profits hidden in offshore tax havens.
- Updating the vendor discount to match Kentucky’s model. Illinois loses the most of any state in the country on this antiquated law that compensates corporations for calculating the sales tax they owe the state. Walmart alone saves $8 million/year from this loophole. The proposed model would protect small business by capping the discount.
- Taxing profits from offshore oil drilling.
- Decoupling from the Federal Domestic Productions Deduction. This is a federal deduction that rewards corporations for expanding their production anywhere in the United States. It does nothing to encourage investment in Illinois specifically.
- The remaining loopholes can be found here.
On Wednesday, Grassroots Collaborative member organizations headed down to Springfield to refute Governor Rauner’s continued policy of disinvestment and call for a People’s Agenda that invests in the people of Illinois, keeps our communities safe, and generates the resources to rebuild.
The People’s Agenda Legislative Platform
Illinois needs investments in our people, measures to keep our communities safe, and new revenue so that we can rebuild our state. We cannot solve our problems with cuts – working and middle-class families have already been cut to the bone. In order to reverse growing poverty in Illinois, fight back against racism, and support women and children in Illinois, we need a bold agenda that puts the people of Illinois at the center.
The People’s Agenda Legislative Platform includes legislation that is being championed by members of several coalitions, including: Grassroots Collaborative, Black Roots Alliance, Fair Economy Illinois, the Illinois Coalition for Immigrant and Refugee Rights, Tuition Free Illinois and other civic and labor organizations.
Investing In the People of Illinois
Legislation to pass a $15 minimum wage that would phase in over the course of 5 years in the state of Illinois. Raising the wage will boost our economy and bring more tax revenue into the state as more folks spend in their communities to purchase goods and services.
Childcare Expansion: HB3213 (Rep. Wallace)
Due to deep cuts made by Governor Rauner, the Illinois’ Child Care Assistance Program (CCAP) remains unavailable to more than 14,000 children. This bill restores children of parents who are in education and training programs back into the Childcare Assistance Program, and begins the critical work of childcare expansion.
The Community Care Program (CCP) helps seniors live in their homes and community longer, avoiding premature and more costly nursing home care. Governor Rauner has proposed creating a new program called the Community Reinvestment Program (CRP), which will cut nearly $200 million from CCP and in-home services for seniors in Illinois. If created, CRP would cut and gravely reduce care to 43,000 seniors currently in CCP.
This legislation will protect those currently receiving care and potentially expand who can receive care. If the ACA is repealed, 671,000 people in Illinois stand to lose health coverage. At the very least we must fight to protect the current system which keeps many of our community hospitals afloat. Over the course of a year and half, Medicaid expansion brought 3.4 billion dollars into the state economy.
Rent Control: HB2430 (Rep. Guzzardi)
Repeals the law that prevents rent control from being enacted in Illinois communities.
Free College Tuition
Legislation to require the state to administer grant funding each year to each state university, based on enrollment, to replace the tuition they would otherwise have received. This initiative will lift the burden of debt from the shoulders of the next generation of Illinoisans and their families, freeing them to spend money in the state’s economy, while attracting businesses and families to Illinois for quality college education.
Elected Representative School Board: HB1774 (Rep. Martwick)
The bill establishes elections (rather than appointments) for the City of Chicago Board of Education through the election of members in representative districts across the city. This bill expands democracy and community input into a school district that has been under the complete control of one man since 1995.
Making Our Communities Safe
Violence prevention: HB3166 (Rep. Stratton)
Comprehensive legislation which will prioritize five key areas of investment in order to stem the violence escalating in communities: street intervention programming, youth jobs, after school program investment, trauma-informed care, and supports for those in contact with the criminal justice system.
Criminal Justice Reform
Sweeping criminal justice legislation, that not only works to address racial inequities in incarceration and policing, but also aims to reinvest the dollars spent on locking up low-level, non-violent and juvenile offenders, putting that money back in the communities that have been most impacted by mass incarceration. Supports programming that addresses recidivism, youth employment, and other community-centered violence prevention initiatives.
Protecting Immigrant Communities: HB426 (Rep. Welch)
Creates the Immigration Safe Zones Act. Establishes that schools, medical treatment and health care facilities, and places of worship may not grant access to law enforcement officers working with Immigration and Customs Enforcement to take action against suspected immigration law violations without a warrant.
Generating the Resources to Rebuild
Protecting Taxpayer Dollars from Predatory Wall St. Deals: HB 2718 (Rep. Welch)
Requires evaluation of state financial contracts, including interest rate swaps, in order to know the financial costs of these hidden agreements. Provides that if these agreements have resulted in losses, all necessary efforts to recover those moneys will be made. Prevents the state from entering into high risk Wall Street deals like swaps in the future.
Close the Carried Interest Loophole: SB 1719/HB 3393 (Sen. Biss/Rep. Welch)
Imposes a privilege tax on hedge fund managers and private equity traders whose large profits currently go untaxed. Estimated revenue of $473 million would fund K-12 education.
Payment Prioritization: HM3871 (Rep. Martwick)
This bill provides that the Comptroller’s efforts to manage priorities during times of fiscal distress, should include issuing payments for education and human services before issuing payments for financial services. Provides for a continuing appropriation for funding of public education and human services.
Closing Corporate Loopholes
This bill closes nine corporate tax loopholes and raises $924M in new revenue for Illinois. These loopholes, including profits from offshore oil drilling and money held in off-shore tax havens, allow big corporations to increase their profits at the expense of the people of Illinois.
TIF money for school wrap-around services: HB3720 (Rep. Harper)
The bill creates parameters for TIF surpluses in Chicago and mandates that money is used for school-based social services like social workers and school nurses, and special education services. This measure addresses both deep cuts to special education and the dire need for trauma-informed social services for thousands of Chicago students.
FRIENDLY Act: HB3522 (Rep. Martwick)
The bill establishes clear and increased funding streams for K-12 and higher education, social service providers, and pension obligations through the resetting of sales, property, and income tax rates. It addresses Illinois’ structural deficit, its long-term challenges related to pension funding, and the insufficient and inequitable funding of Illinois’ public schools and universities.
Chicago, IL 60605
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