I. Legislative Principles
The following principles represent the core values of the Metropolitan Mayors Caucus and its 273 member Mayors which participate in the Caucus through the City of Chicago and nine suburban councils of governments (COGs). These principles are the basis upon which the Caucus reaches consensus on the legislative priorities contained in this document.
A. Protect Municipal Revenues
Local governments have their own budget challenges to address in these difficult economic times. The State should not create added burdens for them by attempting to manage its budget deficit on their backs. The Mayors Caucus will strongly oppose any legislative proposals which try to erode local revenues.
B. Reject Unfunded Mandates
Unfunded and under-funded mandates are intrusive and costly. They generally result in situations where local governments must either cut services or raise local taxes in order to pay for them. The Mayors of the Chicago region are extremely concerned that the State will expand the use of mandates as one means of dealing with its budget problems. We strongly urge the General Assembly not to exercise this option without providing adequate funds to reimburse municipalities for any unfunded or under-funded mandates. No mandates should be adopted which increase the costs of local governments serving their residents.
C. Preserve Local Authority and Home Rule
Increasing attempts are made every year it seems to restrict or eliminate the local decision-making authority of city councils and village or town boards. This applies to both non-home rule and home rule units of government. The Mayors of the Chicago region call on the Governor and the General Assembly to reject legislation that erodes local decision-making authority or overrides home rule authority.
II. Top State Priorities
A. Protect Local Government Revenues
The 96 th General Assembly passed an income tax increase before it adjourned in January to address the State’s ongoing financial crisis. Signed by Governor Quinn within days of its approval, the legislation increases the personal income tax from 3 to 5 percent and the corporate tax from 4.8 to 7 percent. Both rates are due to sunset after four years to 3.75 and 5.25 percent respectively.
While the temporary increases are expected to bring in roughly $6.5 billion annually over the next four years, Illinois has not completely resolved its budget problems. The General Assembly failed to approve other legislation in its waning days which would have allowed the State to quickly pay down its backlog of bills and its pension debt. These issues are expected to be taken up during the 97 th General Assembly.
Caucus Position: Local governments have their own budget challenges to address in these difficult economic times. The State should not create added burdens for them by attempting to manage its budget deficit on their backs. The Mayors Caucus will strongly oppose any legislative proposals which try to erode local revenues.
The Caucus will also join with other municipal groups to support legislation that requires the State Comptroller to transfer the income and sales taxes to which local governments are rightfully entitled from the General Revenue Fund to the Local Government Distributive Fund (LGDF) within seven days of that office receiving certification of payments from the Illinois Department of Revenue and the State Treasurer. For the last eight months, the average length of time municipalities have had to wait to receive their income and sales taxes has been five months.
B. Additional Public Pension Reform
The General Assembly’s passage of legislation this past fall which establishes a second tier of benefits for newly hired local police and fire employees was a solid step in the direction of meaningful pension reform. Public Act 96-1495 will provide much needed fiscal relief in future years. However, while this bill was a good first step, additional reforms are needed to completely and effectively address the burden of skyrocketing public safety pension costs most municipalities in Illinois are under today.
Caucus Position: The Metropolitan Mayors Caucus joins its participating suburban Councils of Governments and the City of Chicago in calling for additional changes to public safety pension systems. The goal is to continue to develop long term, comprehensive solutions that protect Illinois taxpayers and secure sustainable retirement benefits for all public safety employees whether they are new hires or current employees.
Issues that need to be addressed include: increasing the employees’ share of their pension contribution; fund consolidation; requiring a supermajority to pass future benefit enhancements; returning local pension board control to municipal employers; and putting an end to abuses such as double dipping, salary spiking and local pension boards not complying with statutory requirements regarding the certification of disabilities and spousal benefits.
C. Interest Arbitration
The Illinois Public Labor Relations Act contains a section which addresses collective bargaining requirements for police and firefighters. The section includes a provision which establishes standards by which binding arbitration is to be used to resolve contracts when labor and management have reached impasse. The standards include guidance on the factors arbitrators should consider when making a decision.
Caucus Position: The Mayors Caucus will join with other municipal organizations to support an amendment to the Public Labor Relations Act which will require arbitrators to consider the ability of a local government to afford the costs of the demands submitted by a police or fire union, the total compensation of the employee contract and other fiscal implications. The amendment will give arbitrators the ability to adjust their decisions accordingly.
D. Workers’ Compensation Reform
An effort was made during the last days of the 96 th General Assembly to reform the State’s workers’ compensation laws. An amendment to SB 1066 which had the support of employer groups passed out of the House Executive Committee. The bill was never called for a floor vote before the Legislature adjourned, however. Both Senate President John Cullerton and House Speaker Michael J. Madigan have indicated that a reform package will be considered during the 97 th General Assembly’s Spring 2011 Session.
Caucus Position: The costs associated with the provision of benefits under the Illinois Workers' Compensation Act have become a significant financial burden for local governments and their taxpayers. The so-called "reforms" enacted in 2005 have worsened this state of affairs by producing measurable cost increases within the Illinois workers' compensation system.
The Metropolitan Mayors Caucus joins other municipal groups and employer organizations in calling for reform legislation that does the following:
- Revise the current medical fee schedule.
- Allow employers to direct medical care.
- Make utilization review mandatory and binding.
Indemnity/Permanent Impairment Rating Reforms
- Allow credit for prior recoveries as a policy to prevent repetitive (or stacking) of recoveries.
- Base impairment ratings on either AMA guidelines and/or physician ratings.
- Re-define the basis for claims under the wage differential.
Alcohol and Drug Abuse in the Workplace
- Ease the burden of proof required to prove that alcohol or drug use contributed to an employee's injury.
Re-define Determination of "Accidental Injury"
- Adopt the Missouri model to require that a compensable accident be "the prevailing factor" that resulted in injury instead of only a "causative" factor.
Eliminate Rebuttable Presumptions
- Create a "level playing field" for ascertaining causation for cardiovascular, respiratory, and blood borne conditions developed by individuals employed as firefighters.
E. Catastrophic Injury
The definition of “catastrophic injury” under Section 10(a) of the Illinois Public Safety Employee Benefits Act has been interpreted in different ways by the courts. As a result, confusion exists as to whether municipal employers should be awarding or denying the extra health insurance benefits and disability claims of those employees awarded line-of-duty disabilities.
Caucus Position: The Mayors Caucus will work with the Illinois Risk Management Association, the City of Chicago, its participating suburban COGs and the Illinois Municipal League on legislation to clarify the term “catastrophic injury” and eliminate the abuses of the system that occur under its current interpretation.
F. Streamlined Sales Tax
In December 2007, the Governing Board of the Streamlined Sales Tax Project (SSTP) amended its enabling agreement to allow participating states to maintain origin or “point of sale” sourcing for intrastate purchases. It has been presumed that this amendment clears a significant hurdle in getting larger states like Illinois to join. However, there are still significant definitional issues with the context of the SSTP’s point of sale rules which must be resolved before Illinois becomes an SSTP participating state.
Caucus Position: The Mayors Caucus will work with the General Assembly, the COGs and the City of Chicago to pursue implementation of the Streamlined Sales Tax Project Agreement as amended provided the above-mentioned definitional issues are resolved. It also believes that any legislation authorizing the State’s participation in the Agreement must:
- Establish “point of sale” as the principal sourcing rule for intrastate purchases in Illinois;
- call for a detailed study by the Department of the impact on each municipality of both the SSTP’s sourcing rules and the potential increased revenues from an expanded tax base due to the collection of taxes on Internet, catalogue and other remote sales;
- include a guaranteed mitigation plan (i.e. not subject to the annual appropriation process) which will hold-harmless any municipality which may possibly lose revenues from the effects of the sales tax changes; and
- authorize all municipalities to have access to sales tax collection records from the Illinois Department of Revenue.
III. Top Federal Priorities
A. Reauthorization of SAFETEA-LU
Action has been delayed in Congress the last two years on legislation which will reauthorize the federal funding programs established in the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users adopted in 2005 (SAFETEA-LU). This was primarily due to the passage of the American Reinvestment and Recovery Act (ARRA) in 2009. While the ARRA provided a significant investment in the nation’s infrastructure, much of that investment did not reach local governments. According to the United States Conference of Mayors (USCM), states benefited most from the ARRA at the expense of cities and metro areas. For example:
while the largest metro areas account for 73 percent of the nation’s Gross Domestic Product, they received only 48 percent of the transportation funding allocated by states;
- and, the largest metro areas account for 87 percent of congestion costs, but received 48 percent of state funding;
- in fact, the USCM study shows that the three most congested metro regions – Los Angeles, New York and Chicago – account for 27 percent of the nation’s congestion, but received only 6 percent of the funds allocated by states.
Caucus Position: The Mayors of the metropolitan Chicago area intend to work with the Chicago Metropolitan Agency for Planning, the Regional Transportation Authority, the State of Illinois, various local governments and agencies and the Illinois congressional delegation to build consensus on a strategy for the next federal reauthorization which will reverse the under-investment cities and metro regions experienced through the ARRA. Because metro areas like Chicago are the engines of the nation’s economy, a major investment in metro area highway, transit and rail systems will help stimulate much-needed economic growth and job creation.
The Metropolitan Mayors Caucus has identified the following strategic principles that its member Mayors recommend be included in any reauthorization legislation:
- increase federal funding levels overall to meet critical needs for rehabilitation and new capacity;
- increase Illinois’ and the Chicago region’s share of formula-driven funds;
- preserve the basic structure of SAFETEA-LU in the reauthorization legislation;
- ensure adequate CMAQ funding for northeastern Illinois;
- maintain the firewalls and guaranteed funding levels for transit, highway and safety programs;
- increase the cooperative sub-allocation of funds to municipalities, counties and transportation agencies through metropolitan planning organizations (MPOs); and
- maintain SAFETEA-LU’s innovative programs, such as flexible funding provisions.
The Caucus also calls for Congress to fully fund the Chicago Region Environmental and Transportation Efficiency Project or CREATE in the reauthorization bill. The Project includes several grade crossing improvements, technology upgrades and flyovers that will bring the region’s rail network into the 21 st Century. The Caucus also supports additional rail/road improvements needed to meet the demands and address the impacts of increased freight train traffic in the region . Particular attention should be given to those portions of the region which lack adequate infrastructure.
B. National Freight Plan
Freight – whether truck, rail or air – is a national, interstate commerce issue. The national economy depends on its efficient movement via an interconnected system of roads, highways, rail and airways.
Caucus Position: The Federal government needs to formulate a national freight plan that can guide state, regional and local efforts to improve freight systems. The plan should include dedicated funding for corridors of national significance.
IV. Other State Priorities
A. Prevent Foreclosures and Protect Neighborhoods
The Mayors Caucus, the City of Chicago, the suburban Councils of Governments and the Illinois Municipal League came together with housing advocates two years ago to support a legislative package to address the abandoned property component of the foreclosure crisis. That legislation, signed into law in December 2009, provided that municipalities receive notice when a foreclosure action is initiated and again when it is completed. It also established a priority lien position for municipalities if they tried, but failed to contact the owner of a vacant building and then did work necessary to maintain or secure the property. While the legislative package adopted in 2009 provided substantive tools for municipalities to address abandoned properties, additional legislation is necessary to further stem the foreclosure crisis.
Caucus Position: The Caucus supports legislation which authorizes municipalities to hold financial institutions and mortgage servicers liable for maintaining any vacant or abandoned properties on which they hold a mortgage. It will also work with housing advocates on legislation which gets to the root of the foreclosure crisis and provides tools which allow homeowners to stay in their homes. Such tools include foreclosure mediation, stand-alone counseling and legal aid programs.
B. Eliminate Barriers to Consolidation of Municipal Services
The Metropolitan Mayors Caucus has initiated an innovative project to investigate the feasibility of consolidating various municipal services. The goal of the study is to identify ways in which municipalities can provide police, fire, code enforcement and public works services more efficiently and cost-effectively. Several case studies will wrap up in early 2011 which will provide examples of various consolidation models including functional consolidation of specific services, service contracting between jurisdictions, department mergers and new service delivery districts.
Caucus Position: The Mayors of the Chicago region are very excited about the Caucus’ Service Delivery Project and its potential for identifying innovative ways to provide consolidated municipal services that save money and reduce the burden on taxpayers as well as create efficiencies in various departments. One of the deliverables of the case studies mentioned above is to identify legal and legislative barriers to consolidation efforts. The Caucus will share these results with the General Assembly and the Governor’s Office and work with them to devise a common sense strategy to remove and/or mitigate these barriers.
In the meantime, the Caucus has heard rumors that municipal employee unions are considering introducing legislation which will prohibit local governments from consolidating. In these tough economic times when municipal officials are trying to provide sufficient services to their residents with fewer resources, the Mayors of the Chicago region believe this to be shortsighted. The Caucus urges the General Assembly to reject any attempts by organized labor to prohibit or limit the ability of local governments to pursue consolidation strategies of any type.
C. Protect Tax Increment Financing As Economic Development Tool
Tax Increment Financing (TIF) is one of the last effective economic development tools available to local governments. Legislation has already been introduced to attempt to further reduce or even eliminate the use of TIFs by municipalities.
Caucus Position: The current statutory limitations on the implementation of TIFs are extremely rigorous and serve to ensure that they are only created where appropriate. The Mayors Caucus will oppose any legislation that imposes a moratorium or greater restrictions upon the use and creation of TIF districts.
D Commercial FOIA Requests
Under the changes made to the Freedom of Information Act (FOIA) two years ago, local governments were required to respond to requests for information even if they are submitted by commercial entities which intend to use that information for business or for-profit purposes.
Caucus Position: Municipal officials believe that FOIA requests made by commercial entities to solicit customers, gather data needed to advance its business or seek information which support profit-making motives are intrusive and can jeopardize the privacy and rights of private citizens. The Mayors Caucus supports an amendment to the new FOIA law which authorizes municipalities to deny commercial FOIA requests or, alternatively, to charge for the full costs of the records sought.
E. E-Waste Recycling
When the Electronic Products Recycling & Reuse Act was signed into law in 2008, Illinois was considered a leader in providing electronic recycling options for its citizens. The law sought to increase residential e-waste collection and gave most of the responsibility for e-waste collection to electronic manufacturers, thus relieving local government of the costs of such programs. Unfortunately, several flaws were identified with the new law in the last two years. This slowed the implementation of manufacturer-sponsored recycling efforts as well as either permanently or partially shutting the existing e-waste collection network in the Chicago region.
Caucus Position: Mayors Caucus staff has been meeting with the electronic manufacturing industry, environment organizations and State agencies to develop solutions to the flaws in the 2008 Act. To get the State’s e-waste program back on track, the Mayors Caucus supports the following amendments:
- Manufacturers must select recyclers in anticipation of the recycling year and be required to certify that the recyclers will comply with the environmental, health and safety standards set forth in the Act;
- The recycling goal for manufacturers should be based on market-share rather than return-share to align with other states’ legislation for better ease of implementation for manufacturers; and
- Fines for manufacturer failed compliance should be increased. Currently fines are too small to compel compliance. Manufacturers have consciously chosen to pay the lower fines in lieu of implementing a recycling program.
V. Other Federal Priorities
A. Electronic Commerce
The Streamlined Sales Tax Project (“SSTP”) has been working for the last several years to simplify state and local sales tax systems and removes the burdens to interstate commerce that were of concern to the U.S. Supreme Court in the Bellas Hess and Quill cases. The decisions in these two suits prohibited state and local governments from collecting sales taxes on catalogue and remote sales.
The SSTP adopted an amendment to the sourcing rules in its enabling agreement a year ago which will allow local governments to continue to collect taxes at the point of sale for all intrastate purchases. Taxes on interstate purchases (i.e. those made over the Internet, via remote catalogue, etc.) will be based on the levies in effect at the location to which they are shipped. This is also called destination sourcing.
This amendment will likely clear the way for the State of Illinois and other states to adopt the agreement and become a participant in the SSTP. While states and local governments have been doing there parts to work together to eliminate the hurdles to taxing electronic commerce and create the justification for Congress to overturn the Bellas Hess and Quill decisions, Congress has yet to act.
Caucus Position: The Metropolitan Mayors Caucus calls upon Congress to grant to those states that comply with the Streamlined Sales Tax Project Agreement as recently amended to allow point of sale
sourcing the authority to require all sellers, regardless of location, to collect the relevant state and local sales and use taxes. By granting this authority, Congress will ensure the viability of the sales tax as a state and local revenue source. It will also level the playing field between Internet, catalogue and “brick and mortar” retailers.
B. Asian Carp
Recent lawsuits and legislation filed by Michigan officials and supported by other states call for the closing the navigational locks in the Chicago Sanitary and Ship Canal to stop the incursion of Asian carp into the Great Lakes. Closing this waterway would be devastating to the economy of the Chicago region and would potentially increase the risk of flooding in the area in the event of significant storm events.
Caucus Position: The Mayors Caucus agrees that more needs to be done to stop the migration of Asian carp into the Great Lakes. We are optimistic that a comprehensive plan for dealing with this invasive species will emerge from discussions currently taking place between federal officials and representatives of various state, regional and local agencies in the Great Lakes region.
The Caucus is hopeful that the notion of closing the locks in the Sanitary and Ship Canal will be removed from consideration once the parties to these discussions learn of the effects such a decision will have on the Chicago region’s shipping and boating industry, its overall economy, and its ability to manage stormwater. To ensure they understand, the Mayors Caucus recommends that the United States Army Corps of Engineers do a study of the impact a decision to close the locks will have on the Chicago region’s economy.