Clark Kaericher l Senior Vice President, Government Affairs l 217-522-5512
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The Infrastructure Council is an initiative of the
Illinois Chamber that brings together Chamber members with a focus on increasing
infrastructure investments in a strategic and thoughtful way to boost the overall business climate in Illinois. Our focus is on the public and private systems that are essential to Illinois businesses.
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I apologize in advance for the length of this newsletter but there’s a lot to discuss. If you have limited time, I recommend focusing on the Future of Work Report detailed below.
Future of Work Meeting 8 and Draft Final Report
Friday morning the Future of Work Task Force met for the final time for a substantive meeting. The group met to discuss the recently released draft of the final report. The full draft is HERE. I strongly encourage you to read it.
The report is long at nearly 75 pages and there is a lot in the report that we can all agree on. Everyone can assent that childcare is a major issue facing both employers and working families. Everyone can agree on the importance of an educated and skilled workforce and the occasional need to retool employee skills.
However, there are two things in the draft report that the Chamber cannot support. The first is the treatment of independent contractors and the gig economy. The second is the sledgehammer they take to the trucking industry in the draft.
Here are the relevant sections. I’d very much love your feedback and plan to offer suggestions to the report’s authors at their office hours on Wednesday:
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Nearly 600,000 Illinoisans are employed in direct transportation or material moving occupations. The state of Illinois along with the entire nation relies on these workers to function. Recent supply chain problems have made this only more obvious as the country reels from the effects of the COVID-19 pandemic, international tariffs, trade regulations, and increased consumer demand. Without these workers, 925 million tons of freight worth an estimated $1.3 trillion would not find its way into the Greater Chicagoland area alone. These numbers don’t include the millions of tons of freight worth trillions of additional dollars that residents across the entire state of Illinois depend on. The COVID-19 pandemic illuminated the key role truck drivers, last mile delivery drivers, and warehouse employees play in ensuring that goods from surgical masks to microchips make it to the doors of Illinois residents and companies.
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Deregulation of the trucking industry changed trucking from a steady well-paying job to unpredictable and unsustainable work. Regulation and unionization played a role in the emergence of trucking as an industry that provided family-sustaining wages and appropriate levels of services to communities regardless of size. After the Carter Administration deregulated trucking in 1980, the industry experienced rapid growth and competition among carriers increased, but truck drivers’ wages steadily declined, working conditions became worse, and unions and workers lost power in the industry. Today companies tend to employ the cheapest possible labor model, which puts inexperienced drivers on the road in the least desirable positions and misclassifies them as contractors rather than employees. The truckers that individuals, families, and communities rely on today frequently spend weeks on the road, with much of this time being spent on unpaid activities such as loading and unloading. A recent article appearing in Time magazine mentions that the industry has an abnormally high turnover rate and companies are engaging in a battle to the bottom, providing less and less suitable working conditions knowing that drivers have no power to demand more.
While many in the industry claim to have a shortage of drivers, licensing records show more than enough licensed drivers exist to fill open jobs. Currently states and localities spend millions of federal dollars to train truck drivers; consequently, many people have earned CDL licenses but very few actually stay in the trucking industry. Review of DMV records in California shows that there are 147,500 truck transportation jobs and 468,000 licensed CDL drivers in the state, with more licensed drivers than jobs the presence of unfilled positions is unlikely caused by a shortage of drivers. Poor working conditions make it difficult for drivers to stay. Effectively, state and federal training programs are facilitating the bad behavior of predatory trucking companies by supplying them with an endless flow of new truck drivers to replace the ones that have left as a result of poor conditions. Utilizing regulation as a tool to improve the quality of these jobs will not just improve the quality of these jobs for the workers, it will lower prices for consumers, increase efficiency and likely profits for companies, and free up state and federal training funds to be allocated to industries with real worker shortage problems.
The future of the trucking industry will be determined by the policies lawmakers, business owners, and worker advocates make today. The recent development in capabilities of autonomous vehicles and other developments in automation and technology have already changed the way Americans drive. Recent years have seen more cars on the road with autonomous capabilities such as adaptive cruise control and automatic parallel parking systems, and companies like Uber and Waymo already have a small number of autonomous vehicles in operation at pilot locations. The future surely holds changes for jobs in the transportation industry, now is the time to invest time and resources into identifying policies and practices that can be put into place to build the transportation Illinois wants. Industry experts predict that self-driving trucks will be able to operate on highways without any need for a human driver, and when this happens roughly 294,000 non-specialized long-distance drivers will lose their jobs. Simultaneously, the rapid growth of e-commerce and lower freight costs (resulting from cheaper driverless long distance transport) is likely to create many more new jobs, however these jobs will likely have low pay and poor working conditions, resulting in a further degradation of job quality in the trucking industry. This grim forecast is not a certainty, if policy makers, business leaders, and worker advocates meaningfully engage in shaping the future of this industry now, it could once again be the quality middle class job that supported workers, families, and communities decades ago.
Industry experts advocate for a three pillar approach to shaping the future of the trucking industry.
- An industry-wide standard should be adopted to accomplish the goals of developing good career pathways and job training programs and establishing safety-net programs to support workers transitioning into and out of the industry.
- Establish a strong set of labor standards and worker protections that address the issues of independent contractor misclassification and wage theft, and improving working conditions
- Promote innovation with the ability to improve social, economic and environmental outcomes.
The Draft Report’s Policy Recommendations:
- Establish a Trucking Innovation and Jobs Council that will unite stakeholders and work to identify and implement policies and programs that improve job quality, safety, and social, economic and environmental outcomes.
- Establish worker protections that ensure drivers who do work for one company are classified as employees rather than independent contractors.
- Ensure that public training dollars are serving the purpose of providing drivers with skills to advance their careers.
- Give workers the power to unionize and collectively bargain for benefits and protections.
Despite all the good stuff in other portions of the report, this section alone is enough to make me vote against the report’s adoption.
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End of Session Report- Infrastructure
Last week we sent out the 2022 End of Session Report as compiled by the Chamber’s Executive Directors. You can read the full report HERE. The following is the significant legislation that was followed by the Infrastructure Council this Spring sorted by topic area:
CDL Hiring Tax Incentives
SB 3719 (DeWitte)- Creates an income tax credit for a taxpayer that hires a new employee for a position as a driver for which a commercial driver's license is required and an individual taxpayer who is employed as a driver in a position in which a commercial driver's license is required. This is an Illinois Chamber of Commerce initiative. This bill did not move out of the Senate Executive Committee and was re-referred to Senate Assignments.
Construction
HB 4251 This bill provides that any purchase by a township for services, materials, equipment, or supplies in excess of $30,000 (rather than $20,000) shall be contracted in specified ways. Provides that contracts for construction work whose estimated cost will exceed $30,000 (rather than $20,000) for township waterworks and sewerage systems shall be let to the lowest responsible bidder. This bill passed both houses.
HB 4393 This bill provides that specified contracts may be let to the lowest responsible bidder or the best value bidder (rather than to the lowest responsible bidder). As amended, provides that, if an entity is eligible to be paid for or reimbursed, in whole or in part, with federal-aid funds, grants, or loans, and the letting of a contract to the best value bidder under the provisions would result in the loss of those federal-aid funds, grants, or loans, then the contract shall be let to the lowest responsible bidder (rather than the contract is exempt from the provisions). This bill passed the House but did not advance past Senate Assignments.
HB 5035 This bill provides that the Department of Transportation may implement a 5-year pilot program to allow a contractor to provide a non-diminishing irrevocable bank letter of credit in lieu of specified bond requirements on contracts under $500,000. Provides that projects selected by the Department of Transportation for the pilot program must be classified by the Department as low-risk scope of work contracts. Provides for the adoption of rules concerning the criteria for pilot project selection and implementation of the pilot program. This bill passed both houses.
HB 5412 This bill as amended, provides that, for all contracts entered into on or after July 1, 2022, a primary contractor making or taking a contract in the State for the erection, construction, alteration, or repair of a building, structure, or other private work in the State, shall assume, and is liable for, any debt owed to a claimant incurred pursuant to the Act by a subcontractor at any tier acting under, by, or for the primary contractor for the wage claimant's performance of labor included in the subject of the contract between the primary contractor and the owner. This bill passed the Senate but still awaits House action.
HB 5538 (Halpin) - Amends the Prevailing Wage Act. Provides that the provisions of the Act apply to the construction or demolition of public works performed by an employee of a public body engaged in the construction or demolition of public works on behalf of another public body. This bill passed out of the House but was re-referred to Assignments Committee in the Senate.
HB 5550 (Slaughter) - Amends the Prevailing Wage Act. Provides that the transportation of ready-mixed concrete and the transportation of aggregate or excavated materials shall be deemed to be employment upon public works. Provides that all laborers, workers, and mechanics performing transportation of ready-mixed concrete and transportation of aggregate or excavated materials shall be deemed to be employed in actual construction work upon public works. This bill was assigned to the Labor & Commerce Committee but re-referred to House Rules.
Design Build
SB 2981 (DeWitte/Evans) is on its way into law. This legislation will provide IDOT with the much-needed design-build authority. Illinois lags almost every other state in this area and the Chamber is very supportive of this bill. Other state practice has shown design build to be much faster and much cheaper than the traditional design-bid-build. This process won’t be used for every project, of course. It works best on bigger, more complex projects but it’s definitely a tool that the state should be utilizing. We applaud the General Assembly for its passage.
SB 3625, Design Build Procurement Act Extension passed out of the Senate by a vote of 36-16-0. This bill amends the Design-Build Procurement Act. Extends the repeal of the Act from July 1, 2022 to July 1, 2027. Opposition to the bill was due to earlier patronage allegations at the Capital Development Board. Note that this bill applies to vertical construction (e.g. buildings) and not horizontal (e.g. roads and bridges). This bill passed both houses.
SB 3795 (Morrison)/ HB 4772 (McLaughlin) - Creates the County Design-Build Authorization Division in the Counties Code. Provides that a county may enter into design-build contracts. SB3795 passed the Senate but did not advance in the House. HB 4772 passed both houses.
Electric Vehicles
HB 3125 (Gabel) which creates the Electric Vehicle Charging Act. Sets forth requirements for parking spaces that are electrical vehicle ready applicable to new or renovated residential or nonresidential buildings. Additionally outlines provisions concerning electric vehicle charging station policies for unit owners and renters. Creates the Electric Vehicle Access for All Program to maximize opportunities for carbon-free transportation across the State, particularly targeting environmental justice and low-income communities and to provide grants to pilot programs with the purpose of bridging public transportation gaps between residences and employment locations. This bill passed the House but did not move out of the Senate Energy and Public Utilities Committee.
HB 4389 (Moylan) - Requires the Environmental Protection Agency to establish a fleet electrification voucher program to promote the use of electric trucks by fleet owners by offering a voucher of $200,000 per electric Class 7 truck or electric Class 8 truck purchased or leased for a fleet by the fleet's owner or operator. Provides that an applicant shall submit a proof of purchase, lease, or other binding contract regarding the electric Class 7 truck or electric Class 8 truck in order to be awarded the voucher. Provides that, upon approval of the initial application, an applicant must scrap a diesel Class 7 truck or diesel Class 8 truck from the applicant's existing fleet. Requires an applicant who is awarded a voucher to agree to participate in annual surveys on specified metrics. This bill did not move out of Rules Committee.
HB 4963 (Vella) - Amends the Reimagining Electric Vehicles in Illinois Act. Provides that the application approval as a REV project must be by formal application (currently, formal written letter of request or formal application). Provides that each application shall state the minimum number of jobs created or retained at the facility and, for all proposed classifications, commitments to salaries, wages, benefits, investment in training, including commitments to pre-apprenticeship and apprenticeship programs, specific protections for worker health and safety, and hiring plans. Provides that each applicant shall state whether it is party to a bona fide labor peace agreement. Provides that applications shall be considered public records subject to disclosure under the Freedom of Information Act. Provides that applicants that are issued credit certificates must report the number, occupation, wages, and benefits of new employees. This bill was assigned to the House Revenue Committee but later re-referred to Rules.
SB 2940 (Koehler/Hoffman) This bill amends the Electric Vehicle Act and the Electric Vehicle Rebate Act to delete language providing that "electric vehicle" does not include electric motorcycles. Provides that, beginning July 1, 2022, each person shall be eligible to apply for a $1,500 rebate for the purchase of an electric vehicle that is an electric motorcycle.
HB 5507 (LaPointe) - Removes the $100 surcharge in lieu of the payment of motor fuel taxes added to the registration fee for electric vehicles. Removes the $100 additional fee to identify a vehicle as an electric vehicle. This bill was assigned to House Revenue but re-referred to Rules.
HB 5571 (Lewis) - Provides that the Capital Development Board shall adopt rules to require that each newly constructed residential building in the State that includes a garage shall provide for sufficient electric generating capacity in the garage to charge an electric vehicle. This bill was assigned to Energy & Environment Committee and re-referred to House Rules.
SB 3051 (Fine) Creates the In-home Electric Vehicle Charging Infrastructure Act. Provides that if the construction of one or more new housing units or major renovations will include at least one garage, carport, or driveway for each housing unit, the builder or the builder's agent shall provide each buyer, prospective buyer, or homeowner with the option to include either an electric vehicle charging station capable of at least level 2 charging or equipment to support the later addition of a such a charging station in or on the garage, carport, or driveway. Requires a builder to give a buyer or homeowner notice of this requirement along with information on available rebate programs for installing an electric charging station. Requires the buyer or homeowner to provide notice of receipt. Provides a private right of action for persons aggrieved by a violation of the Act. Effective July 1, 2022. This bill was assigned to Energy and Public Utilities and re-referred to Assignments.
SB 3171 (Murphy) – Identical to HB 4389, above. This bill was rereferred to Assignments Committee.
IDOT
HB 4431 (Zalewski) - Provides that the Department of Transportation shall establish the local government revenue reimbursement program to reimburse a county, municipal, township, or village government for revenue lost due to a road, highway, or interstate construction project initiated by the Department of Transportation. Provides that, to receive reimbursement, within 90 days after the completion of a construction project, the county, municipality, township, or village shall submit to the Department of Transportation a reimbursement request on a form prescribed by the Department of Transportation and supported by a report by an independent auditor verifying the estimated amount of revenue lost over the duration of the construction project. Provides that the Department shall reimburse a local government entity within 90 days of receiving a reimbursement request. Effective July 1, 2022. This bill was assigned to Appropriations – Public Safety but Re-referred to Rules Committee.
HB 5262 This bill creates the Infrastructure Delivery and Program Transparency Act. Provides for the creation of an Infrastructure Implementation Coordinator within the Office of the Secretary of Transportation to administer the Rebuild Illinois Program. Provides that the Office of the Secretary of Transportation shall develop a publicly available project information website that includes detailed information about each infrastructure project. Provides that the Coordinator shall track and make publicly available a master program, budget, and construction schedule and program metrics. Provides that after a review of the program metrics, the Coordinator shall implement improvements to the Rebuild Illinois Program in accordance with the established overall program budget and project schedule. Provides that the Department of Transportation and the Coordinator shall implement certain initiatives to assist the Department with meeting program goals. This bill passed the House but did not advance out of Senate Assignments.
SB 1233, This bill creates a task force to study future transportation funding. Provides that the Commission shall report a summary of its activities and produce a final report of its data, findings, and recommendations to the General Assembly by January 31, 2023. The Chamber supports this bill. This bill passed both houses.
Mass Transit
SB 3082 This bill amends the High-Speed Railway Commission Act so that the following positions are now appointed by the Governor: a representative of a labor organization representing rail workers; a representative of a trade organization related to the rail industry; a representative of the Metropolitan Mayors and Managers Association; a representative from the Illinois Railroad Association; a representative from the University of Illinois System; a representative from the Chicago Metropolitan Agency for Planning; a representative of the Illinois Municipal League; a representative of the Champaign-Urbana Mass Transit District; a representative of the Region 1 Planning Council; a representative of the McLean County Regional Planning Commission; and a representative of the East-West Gateway Council of Governments. Also, appointments must be made by January 1, 2023 rather than January 1, 2022. This bill passed both houses.
SB 3848 (Villivalam) - Amends the Regional Transportation Authority Act. Provides that, by January 1, 2023, the Chicago Metropolitan Agency for Planning and its MPO Policy Committee, in coordination with the Authority, shall develop and submit a report of legislative recommendations to the Governor and General Assembly regarding changes to the recovery ratio, sales tax formula and distributions, governance structures, regional fare systems, and any other changes to State statute, Authority, or Service Board enabling legislation, policy, rules, or funding that will ensure the long-term financial viability of a comprehensive and coordinated regional public transportation system that moves people safely, securely, cleanly, and efficiently and supports and fosters efficient land use. This bill passed both houses.
Railroads
HB 5233 (Gabel) - Provides that, for fiscal year 2022 and each fiscal year thereafter, $5,500,000 shall be transferred from the Grade Crossing Protection Fund to the Transportation Regulatory Fund (currently, $3,000,000). This bill was rereferred to House Rules Committee
SB 3421 (Murphy) - Amends the Property Tax Code. Provides that railroad property shall be assessed based on the location of the property (rather than as a unit). This bill was rereferred to Assignments.
SB 3661 This bill amends the Motor Fuel Tax Law. Repeals provisions concerning reports by railroad companies, and street, suburban, or interurban railroad companies. This bill passed both houses.
Vehicle Manufacturers and Dealers
HB 5395 (Greenwood). HB 5395 seeks to charge a motor vehicle manufacturer in the event of an auto dealer closure. In the unfortunate event of a dealership closure, this legislation would make manufacturers liable for payments to municipalities for over 20 years! This would be unprecedented in Illinois law. It interferes with the private right of contract; it discourages right sizing of businesses, and it will hinder further expansion- companies will be forced to reassess before opening a new location thus harming the small towns the sponsor seeks to help. Chamber President Todd Maisch testified against this bill in committee. This bill passed out of the House Transportation: Vehicles & Safety Committee but did not advance on the floor.
Vehicle Registration/Driver’s License
SB 3096 This bill creates a path for digital drivers’ licenses in the state. It would allow drivers to operate a motor vehicle without a physical copy of their license. The bill also provides that a person shall not be issued a citation for driving a motor vehicle without a physical driver's license if the person presents a digitized driver's license to a law enforcement officer in connection with a traffic stop. This bill passed both houses.
SB 3609 This bill provides that the registration fee for cars and small trucks shall be reduced by $25 if vehicle is manufactured in this State and the application for registration is made no more than one year after the month in which the vehicle was manufactured. This bill passed both houses.
Broadband Ready Grants
Last week, Governor JB Pritzker and the Illinois Department of Commerce and Economic Opportunity (DCEO) today announced the second cohort of the Regional Engagement for Adoption + Digital Equity (READY) program. Through Broadband READY, five regional entities have been selected to receive a total of $250,000 to support planning, research, and data collection as they work to eliminate the digital divide.
Broadband READY grants empower regions to explore opportunities for equitable advances in the areas of broadband access, adoption, and utilization. Each grantee will create deliverables that provide a comprehensive assessment of the broadband landscape in their respective region, which will guide program integration and resource investment to close gaps in broadband equity and inclusion.
Through the READY program, five institutions with regional ties were awarded a total of $250,000 ($50,000 each) to conduct research and outreach on digital equity:
- Bloomington-Normal EDC (North Central Region)
- Chicago State University (Northeast Region)
- Northern Illinois University (Northwest Region)
- Southern Illinois University Edwardsville (Southwest Region)
- Western Illinois University (West Central Region)
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Next Infrastructure Meeting May 20th - Registration Now Open
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You can register for the Infrastructure Council quarterly meeting here.
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Articles of Interest
Until next time,
Clark
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Not a member and want to learn more about the Illinois Chamber - click here to contact Lauryn Thornton. Click here to contact Jack Bernhardt.
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