Illinois Impasse
Feb 8, 2017


While Illinois legislators postponed voting on the "Grand Bargain," a set of 13 bills aimed at ending the budget impasse and addressing the state's fiscal woes (including workers' compensation reform), Illinois Attorney General Lisa Madigan filed a request to halt state workers' pay beginning February 28th. Last July, the court ordered the comptroller to pay wages to state employees despite not having a budget in place. Illinois hasn't had a fully funded budget for 19 months.




Governor Rauner and the Democrat-controlled held legislature have remained in a stalemate since Rauner took office in 2015. Rauner wants the legislature to address workers' compensation reform, term limits, freezing property taxes, and pension and education reform before he approves a budget. Democratic House Speaker Michael Madigan contends the governor is holding the budget hostage to push his political agenda.



A six-month stopgap budget expired at the beginning of January, 2017. Although Illinois will still be required to continue to pay school districts, child welfare, and debt payments, higher education and social services will not receive any additional payments. Illinois' credit rating, the worst in the nation, was downgraded again because of the budget stalemate and the nearly $11 billion in unpaid bills. Attorney General Madigan filed the motion to force action by the governor and the legislature.



The Illinois Senate returned to Springfield yesterday to resume negotiating the Grand Bargain and for a possible vote this week. The bipartisan 13-bill package would raise personal and corporate income tax, as well as create a new business opportunity tax. It also includes workers' compensation reform and a temporary property tax freeze to improve the state's business climate. Meanwhile, state legislators introduced legislation that would continue to pay state employees.

Dodd-Frank Review


President Trump signed a pair of executive orders - one ordering a review of Dodd-Frank, financial industry regulations, the other halting the implementation of the Fiduciary Rule, requiring financial advisers to act in the best interest of their clients in retirement planning.



The executive order does not call for any immediate changes to Dodd-Frank but ordered the heads of regulatory agencies to report back to him within 120 days with suggestions to change existing financial regulations. The Department of Labor must review the Fiduciary Rule as well before implementation. The deadline for implementation was supposed to be April, 2017. We'll keep watching how this might impact insurance companies, financial companies, brokers, insurance agents, and those in our industry.

Making Our Way Around The Country


As part of the Grand Bargain, a provision included in S.B. 12 would change the workers' compensation law to end disability benefits for professional athletes at age 35. It defines a professional athlete as someone who is employed by a professional athletic team based in Illinois and receives a majority of his or her income from playing for the team. The bill would reduce the maximum age at which pro athletes can draw wage differential workers' compensation benefits from 67 to 35. The bill drew criticism from the NFL Players Association before the Super Bowl with vows to fight it.



Last week President Trump nominated Judge Neil Gorsuch for the US Supreme Court. The 49-year-old Coloradan sits on the 10th Circuit Court of Appeals. Gorsuch previously clerked for both Justices Bryon White and Anthony Kennedy and has aligned himself with Justice Antonin Scalia's judicial philosophy. The Supreme Court has been operating with eight justices since the death of Justice Scalia last February. Senate Republicans are hoping to confirm Gorsuch by early April.



The Texas Division of Workers' Compensation (DWC) issued a memorandum providing a grace period for employers without workers' compensation insurance coverage (non-subscribers) to provide any late required reports to DWC without penalty. This grace period allows non-subscribers that have not reported their non-coverage status for prior years to submit the reports without penalty until April 30, 2017.



Valentine's Day is right around the corner and is celebrated in different ways around the world. Personally, I just like a card and a Heath Blizzard - yum.

About The Way

The Way is Gallagher Bassett's weekly governmental briefing on state and federal affairs that affect our industry. We thank you for starting your Wednesday morning with us. Please be sure to follow #GBTheWay for additional news and updates as we make our way throughout the country on the issues affecting our industry. For more information, please connect with GB on LinkedIn, follow us on Twitter, or contact the authors, Greg McKenna or Cari Miller, directly.


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