IVCA Provides Updates for State and Federal Legislative Issues - 04.25.18

IVCA Provides Updates for State and Federal Legislative Issues - 04.25.18

 
Illinois Legislative Report
April 26, 2018
David Stricklin / Stricklin & Associates
 
PRIVILEGE TAX HALTED
 
Throughout 2017 and early 2018 IVCA has worked against legislation in the Illinois House and Senate to impose a 20% tax on capital gains earned by investment managers.  The 2018 versions of the tax, SB 3189 (Biss) and HB 4293 (Welch) are effectively sidelined for this session of the General Assembly. 
 
Until adjournment legislation is never completely “dead” but both bills failed to meet a series of deadlines and rules established by the legislature. The Senate bill was never sent to a committee, and the House bill while sent to committee was not called for a hearing.  The outreach to legislators by IVCA members was instrumental in helping legislators communicate their opposition to the bills.  We will of course maintain watch and advise you if anything changes.
 
TDA 3 LEGISLATION MOVES AHEAD
 
SB 3205 (Harmon) to expand and improve the Technology Development Account managed by the Illinois Treasurer is moving ahead nicely.  The bill was unanimously approved in the Illinois Senate Committee on Commerce and Economic Development. IVCA leadership has worked closely with the Treasurer to develop the new features in the legislation:
 
Senate Committee Amendment No. 1
Provides that the State Treasurer shall (rather than may) segregate a portion of the Treasurer's State investment portfolio, that at no time shall be greater than 5% of the portfolio, in the Technology Development Account IIa (TDA IIa). Provides that the aggregate investment in TDA IIa and the aggregate commitment of investment capital in a TDA II-Recipient Fund shall at no time be greater than 5% of the State's investment portfolio (removes language specifying at the time of deposit). Specifies that all or a portion of the moneys in TDA IIa shall (rather than may) be invested by the State Treasurer to provide venture capital to technology businesses, including co-investments, seeking to locate, expand, or remain in Illinois by placing money with Illinois venture capital firms for investment by the venture capital firms in technology businesses. Provides that the investment of the State Treasurer in any fund created by an Illinois venture capital firm in which the State Treasurer places money shall not exceed 15% of the total TDA IIa account balance (currently, shall not exceed 15% of the total investments in the fund). Adds an immediate effective date.
 
You may wish to follow the bill here:
http://www.ilga.gov/legislation/billstatus.asp?DocNum=3205&GAID=14&GA=100&DocTypeID=SB&LegID=110900&SessionID=91 
As you are reading this we are watching the Illinois Senate in session on the floor with an expectation the bill will pass the Senate today!
 
 
HOUSE SPONSOR OF TDA 3
 
We and the Treasurer’s office are working with Illinois State Representative John Connor (D-Romeoville) who will be the House sponsor of SB 3205 when it comes over from the Senate.  Rep. Connor is a newer member who is interested in learning more about the work IVCA members do and is focused on economic development and job creation in his legislative work.  A link to his biography is attached – Rep. Connor is a graduate of the University of Notre Dame and earned his law degree at the University of Illinois.
http://www.ilga.gov/house/Rep.asp?GA=100&MemberID=2503 
BUDGET?
 
Governor Rauner and the four legislative leaders met recently to discuss the FY 19 budget and each legislative leader appointed members to a working group to work on whether an agreement on the FY 19 budget can be reached.  As IVCA members are well aware, the state has a backlog of unpaid bills at around $8 billion on any given day, and faces continued fiscal headwinds which make reaching a budget agreement a challenge under the best of circumstances.  Throw in the fact this is an election year, and Governor Rauner is running for re-election against Democratic nominee J.B. Pritzker, and it is an open question whether there will be agreement on the budget before voters go to the polls.  We will continue to provide updates as the legislative session moves into the home stretch in the month of May.