Legislative Update - IFT

Legislative update 5.5.17
5/05/2017
The Illinois Senate met this week while, their House members worked in their respective districts. Senators continued work on their own bills and heard House bills in committees.

Here are some highlights from this week's action:
Senate, Governor continue budget talks
On Friday, Capitol Fax reported that the Governor’s staff, Senate Democrats, and Republican caucuses met to negotiate on budgetary issues. House Representatives were not included in the negotiations.

At this time, there is no indication an agreement is within reach. The Senate did not act on HB 109, the “lifeline” budget passed by the House in early April. The legislation would provide partial funding for the remainder of Fiscal Year 2017, including $150 million in critical funding for higher education. Social service programs that are in danger of closing would also receive $258 million. If passed, the legislation would appropriate $817 million that currently sits in the Education Assistance and Commitment to Human Services funds.
Ed funding subject matter hearing compares plans
The Illinois Senate held a subject matter hearing to discuss two education funding plans: SB 1 (Sen. Andy Manar) and SB 1124 and SB 1125 (Sen. Jason Barickman).

The sponsors presented their bills to the Senate Education committee; at their core, both measures are based on the evidence-based model. (Read this NPR story for a good explanation of the evidence-based model.) The model examines national best practices for student achievement and costs those out to determine its adequacy rate, leading to a transparent process that lets school districts and parents see where their dollars are being spent. The formula contains 27 different elements, including full-day kindergarten, capping K-3 classes at 15 students, adding specialist teachers, and improving classroom technology.

Despite some similarities, the proposals are very different. Sen. Barickman’s bills would eliminate the Chicago block grant, which is essential to funding Chicago Public Schools. It also contains mandate relief similar to that in SB 13 of the “grand bargain”. SB 1124 and SB 1125 would also allow third-party contracting of non-instructional employees without accountability, eliminate the requirement that schools provide drivers education, and remove the requirement for daily physical education. The IFT strongly opposes these measures.

By contrast, Manar’s SB 1 includes money for Chicago and does not include harmful mandate relief.

With session scheduled to end on May 31, its unknown whether the full Senate will take a vote on a school funding proposal this session.
Bill to close tax loophole passes committee
SB 1719 closes an unfair federal tax loophole by taking action at the state level. Illinois private equity and hedge funds earn an estimated $4.8 billion per year in under-taxed carried interest. Hedge fund and private equity billionaires charge a fee for investing other people’s money and call it “carried interest” to get a lower tax rate and avoid state taxes. SB 1719 establishes a “privilege tax” that captures the revenue lost through this loophole, providing an estimated $473 million for the state. A representative from the American Federation of Teachers testified in favor of the bill before the Senate Revenue committee. The bill passed (5-4) with strictly Democratic support.