6-25-2019; Good News and Bad News for the IL Work Comp Community and more

Synopsis: Good News and Bad News for the IL Work Comp Community.

 

Editor’s comment: Both the State of Illinois and the City of Chicago are in the news and it is certain to be notable for all of my readers. I hate to start with the bad news but we are all grown ups and have to deal with all of it.

 

Starting in a week on July 1, 2019, our IL gas tax will double, driving the cost of a tank of gas up 19 cents a gallon. This money is supposedly ear-marked for “capital improvements” of bridge and road repairs. That isn’t completely accurate as the money is being used for those needs along with lots of others. In my view, the concept of ear-marking taxes in this fashion is to confuse folks that don’t want higher taxes.

 

The overall IL State Budget, including this capitol improvement thing is going to be at an all-time record high by like $10B in one year!. I am sure in my lifetime and legal career, I have never seen the budget jump as it is doing this year under the current regime.

 

IL State Taxes and fees and everything is going up, up and up higher. Illinoisans will pay more for gas, vehicle registration, cigarettes/vaping and parking and more.

 

The new laws also increase the number of casinos in Illinois, legalizes sports betting, and hikes taxes on video gaming, among other changes. I am sure ministers, rabbis, priests/nuns and others fought to block gambling and other vices that are now fully legal in this State, due to our insatiable gov’t spending needs.

Doubling Illinois’ Gas Tax With the City of Chicago’s Combined Gas Tax to Soon Exceed $1.00 a Gallon!

In a week, the new and odd tax plan doubles Illinois’ State gas tax to 38 cents from 19 cents per gallon, which will vault the total tax burden on Illinois gas beyond states such as New York and California to second-highest in the nation, according to 2018 data from the Tax Foundation. The increase will be effective July 1. I believe Illinoisans are going to face the top State combined income, real estate, sales, cigarette and gas tax load of all 50 states. The IL state motor fuel tax will also be tied to inflation, meaning it will automatically rise in future years without lawmaker approval. In addition to State-level increase, the bill allows Chicago to increase its local gas tax by 3 cents. It allows Lake County and Will County to impose a gas tax of up to 8 cents per gallon. And DuPage, Kane and McHenry counties would be able to double their 4-cent-per-gallon gas taxes to 8 cents. These additional hikes may end up making Illinois’ average state and local gas tax burden the highest in the nation. If the Chicago City Council approves a local gas tax increase on top of the State’s increase, drivers at Chicago filling stations would pay 99 cents in taxes and fees on each gallon of gasoline – an effective tax burden of more than 40%.

Hiking Vehicle Registration Fees/Taxes

Next year, when you register your car, IL motorists will see a $50 annual increase in vehicle registration fees for most vehicles next year – up to $148 from $98. Please note the actual cost of registering a car didn’t go up that much—this is another tax. Illinois’ vehicle registration fee was just $79 as recently as 2009. Most other vehicle registrations, such as buses, trailers and oversized vehicles, will see a $100 increase.

$1 A Pack Cigarette Tax Hike

This is called a “sin-tax” because no one fights to make cancer-sticks cheaper. Chicago already imposes the highest cigarette tax in the United State, at $7.17 per pack as of 2016. Illinois charges the fourth-highest cigarette tax in the Midwest at $1.98. The new capital plan hikes this tax by $1 per pack.

According to the Illinois Department of Revenue, tax dollars generated by cigarette sales have declined every year since 2015. Cigarette taxes are volatile, as shown in the Tax Foundation’s recent analysis of cigarette tax revenues from 1955 to 2018 across all 50 states. This can be attributed in part to a decline in tobacco smoking, as well as the ability of smokers in high-tax states to buy smuggled tobacco from bordering low-tax states, like every State that isn’t Illinois.

Recreational Marijuana To Be Legal in Illinois On New Year’s Day, 2020

Our new Governor just signed into law a new provision to make marijuana legal and tax it heavily. They expect to raise $500M a year with this new concept. Please note it remains a very bad idea to smoke marijuana and I recommend all the doctors I know make sure their patients are told this simple fact. Smoking anything is bad for your mouth, throat and lungs.

Parking tax hikes

Parking garage users will see an increase in their taxes starting Jan. 1, 2020. For hourly or daily parking garages, taxes would go up by 6%. Monthly or annual parking spaces would be slapped with a new 9% tax. All of this hurts IL WC lawyers in downtown Chicago and most Illinois cities.

What Does It All Mean to the IL WC Community?

In short, some of the money will go for jobs and new WC claims may come from such work.

I also assume private industry jobs and humans are going to be moving to Indiana, Iowa, Michigan and Wisconsin, our neighboring states. KCB&A has lawyers in those states so if you need aggressive legal counsel for your litigation needs, send a reply.

I appreciate your thoughts and comments. Please post them on our award-winning blog.

Synopsis: Great News!!! New Chicago Mayor Lori Lightfoot Confirms City Hires Gallagher Bassett to Oversee Workers' Comp Defense Program.

Editor’s comment: As I have advised, the City of Chicago needs expert WC claims handling for their WC program and the new Mayor appears to have gotten it. If any of my readers know who to talk to about bringing great WC defense work to City of Chicago claims, please send a reply. For decades, the only way to get such work was to heavily donate to the former “Boss” who managed the WC defense program from afar.

I happily report the City of Chicago will transfer day-to-day control of its $100 million-per-year city workers’ compensation program, which for decades was largely handled in secret under the auspices of that now-indicted Alderman, to a private claims handling company in Gallagher Bassett. They are one of the top national names in the TPA industry.

A first-time audit, performed by outside auditing firm Grant Thornton, found the City’s WC claims program did not operate according to industry best practices, staff members were poorly trained, and it lacked “comprehensive policies and procedures governing claim handling, which can lead to inconsistent claim outcomes for workers,” according to Mayor Lightfoot’s office. The audit further indicated Chicago’s workers’ comp program also lacked key protections against WC fraud, though auditors did not specifically identify any in their report.

The City’s workers’ compensation defense program was thrust into the spotlight in November, when federal agents raided the City Hall offices of the Alderman handling it. At the time, that Alderman was the chair of the powerful City Council Finance Committee chairman who had kept the program under tight wraps during his more than three decades of nearly continuous control of the committee, constantly fighting efforts by the City inspector general to look into the program’s inept and political operations. After federal prosecutors charged that Alderman in early January with attempted extortion for allegedly trying to shake down Burger King restaurateurs, then-Mayor Rahm Emanuel announced he would remove the program from the committee and instead put the city Finance Department in charge of it.

I note the City has two other “semi-work comp” programs when you consider the City’s Police/Fire Disability program and the Department of Aviation program. At present, I don’t know what is happening with these programs and await further news.

I appreciate your thoughts and comments. Please post them on our award-winning blog.

Synopsis: New Laws to Watch Out For In Illinois.

Editor’s comment: In the next six months, these new developments are hitting the risk and claims industry:

  1. Recreational marijuana lands in Illinois on January 1, 2020. Please start a drug and alcohol free workplace program—if you want my draft program, send a reply. If you know someone who wants an old marijuana bust/conviction expunged from their record, send a reply.

  2. Stalking behavior now includes sending unwanted messages via social media. The new law expands the provision of who can bring a petition under the anti-stalking law to include an authorized agent of a workplace; an authorized agent of a place of worship; and an authorized agent of a school.

  3. Our kids are going to be in active shooter/threat school safety drills to be conducted within 90 days of the start of the school year. The new law requires the drills be conducted on days and times when students are present in the building. The law also requires participation from all school personnel and students present and for law enforcement to observe the drill.

  4. The IL Department of Financial and Professional Regulation shall require each new applicant complete a sexual harassment training program provided by the Department and each licensee complete a sexual harassment training program provided by the Department before renewal of his or her license.

  5. Be careful holding your cell phones while driving or even stopped at a light—you are now supposed to be ticketed if you have your phone in your hand. No warnings!