Legislative Action
By DIANE ROSS

What's happening with the issues

IT'S STILL too early to pinpoint which issues will produce the fiercest legislative floor fights this election year, but by mid-April, Democrats and Republicans were drawing the battle lines on a number of predictable issues: worker's compensation (WC) and unemployment insurance (UI), more sales tax relief and other tax relief, and some coal and utility issues.

A new judicial issue arose, apparently in the wake of a March ruling by the Illinois Supreme Court, which allowed a man to escape the electric chair because Illinois has no law against non-abortion killing of a fetus. And the age-old issue of appointment of judges was resurrected with a local option for circuit judges. The sponsors hailed it as the upstate-downstate compromise that would win legislative approval and put the merit selection question on the ballot this fall.

The House also passed the Senate-approved bill (S.B. 760, sponsored by Sen. Jerome J. Joyce (D., Kankakee)), legalizing collective bargaining for elementary and secondary teachers.

WC and UI

Unemployment insurance (UI) and worker's compensation (WC) have been the predominant labor issues since 1975 when the General Assembly approved increases in benefits so liberal that they are among the best in the nation. But the cost paid by business for those benefits, the taxes on those benefits, and the insurance to cover the costs are too high, according to business interests and the governor. The Illinois State Chamber of Commerce (ISCC) and the Illinois Manufacturers' Association (IMA) insist that those management costs must be reduced if Illinois wants to retain its major manufacturers, let alone attract new ones. Earlier this year, Caterpillar, Illinois' largest manufacturer with 55,000 on its payroll, announced it will expand, not in Illinois, but in Iowa, Wisconsin and Indiana, where UI and WC costs are considerably less. Caterpillar's expansion could cost Illinois 33,000 jobs, according to the ISCC and IMA.

Reinstitution of the agreed bill process last year did produce a UI bill (S.B. 1331, P.A. 81-0962), but an apparent rift resulted between the ISCC and IMA. This division among the business lobbies may doom further UI and WC reforms through the agreed bill process.

Nevertheless, there is a proliferation of UI and WC bills in the House and Senate. The most significant are the proposed management-labor agreed UI bill, the bipartisan legislative "agreed" UI and WC bill package in the Senate, and ISCC-written packages in the House and Senate. Committee hearings were just getting underway in mid-April.

In the management-labor UI agreed bill (not introduced as of mid-April) the major provision, like almost all UI bills this year, centers on the voluntary quits issue and generally tightens eligibility. While the law currently denies benefits to those who voluntarily quit without good cause, "good cause" has never been defined. The agreed bill would be more specific. Benefits would be allowed when someone quit for personal or family illness, when a new job lasted for two weeks or until salary was twice the benefits, when another with less seniority would have been "bumped," when there was sexual harrassment known to management, or when a new job was unsuitable.

But nothing was happening by mid-April on a management-labor WC agreed bill, although Gov. James R. Thompson had stepped up efforts to prod management and labor back to the bargaining table.

The Senate's bipartisan "agreed" bill may wind up to be only WC legislation this year. Neither management nor labor supports the package, co-sponsored by Senate President Philip J. Rock (D., Chicago) and Minority Leader David S. Shapiro (R., Amboy), and restrictive provisions have drawn fire from insurance companies and attorneys. The package includes the following:

•  S.B. 1726, like management and labor's agreed UI bill, defines voluntary quits without good cause as those not attributable to the employer. It also shifts the cost of benefits to the second employer, when an employee quits two successive jobs. Now, the cost is shared by both employers.

The first major tax action came April 9 when the House voted 159-1 to remove the second penny on the state sales tax on food and nonprescription drugs

•  S.B. 1739 and 1740 deal with WC, mainly limiting management's liability to injuries suffered on the job. And in the case of a worker who suffers a second injury, the employer would pay benefits for both only if the second injury leaves the worker 70 percent disabled. These benefits would come from a new "subsequent injury" fund, financed partly by the state and partly by management. Employers would pay into the fund a percentage of the amount of claims paid against them the preceding year.

•  S.B. 1739 is designed to streamline the WC process, which is handled by the Illinois Industrial Commission. The bill would require the commission to adopt medical standards for the various degrees of disability, develop a list of medical experts for disputes, put all decisions in writing, and compile a booklet outlining obligations for both the employer and the employee. The legal profession objects to provisions that would limit attorneys fees to $250 in noncontested cases and require attorneys to put in a written contract

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exactly what portion of the claim they want as fees. What's drawn the fire of insurance companies are provisions which require companies to notify employers monthly, instead of yearly, of claims paid against them. The bill would also allow employers to contest claims paid against them, and if the Industrial Commission decides in favor of the employer, the insurance company bears the cost of the claim.

•  S.B. 1740 centers on new options for employers' WC insurance. First, employers within the same industry would be able to self-insure as a group; now only the largest firms can self-insure. Second, employers within the same industry would be able to group together to buy commercial insurance. Employers are able to buy individual commercial coverage now, but often they are reassigned to a risk pool after a year. Two other provisions would reduce overall premiums by allowing $1,000 deductible medical coverage and separate life insurance coverage to cover WC death benefits.

The ISCC has also introduced its own bills under Republican sponsorship in both the House and the Senate:

•  S.B. 1795 and 1796, by Sen. David J. Regner (R., Mount Prospect), tightens UI eligibility;

• S.B. 1974, 1975 and 1976, by Sen. Richard A. Walsh (R., Chicago), limits WC qualifications to work-related injuries;

• H.B. 3399, by Minority Leader George Ryan (R., Kankakee), is a UI bill which offers definitions of voluntary quits without good cause. Benefits would not be allowed when quitting for personal reasons, to join the family which has moved, to look for work in another state, because of injuries which qualify for WC, and because of pregnancy or childbirth.

Other UI/WC bills in the House include H.B. 2824, sponsored by Rep. Thaddeus Lechowicz (D., Chicago), which gives still another definition of voluntary quits; H.B. 3250, which authorizes the Industrial Commission to computerize statistics; H.B. 3381, which bars real estate salesmen or others on commission from WC eligibility and H.B. 3514, which sets up an advisory board to the Industrial Commission.

Sales Tax

The first major tax action of the spring session came April 9 when the House voted 159-1 to remove the second penny on the state sales tax on food and nonprescription drugs effective January 1, 1981. The General Assembly, in special session last October, dropped the first penny effective January 1, 1980. Because Chicago Mayor Jane Byrne sided with Thompson, the Democrats were forced to pass his bill on the first penny cut instead of override his veto of the Democrats' bill to eliminate the entire sales tax on food and nonprescription drugs. But predictably, the second cut came on a Democratic holdover bill: H.B. 276, sponsored by Rep. Clarence Darrow (D., Chicago), which was among a half dozen similar bills in the House, including Thompson's H.B. 2973, which the Democrats refused to send to committee.

It was the farmers who pulled the property tax publicity as the spring session opened

Although Democratic priorities were not yet clear, more action on the food and drug sales tax this year looked likely in mid-April, since a number of bills in both houses covered three alternatives: automatic phaseouts (H.B. 2834, 2984 and S.B. 1457, 1460, 1490); clarifying the exemptions (H.B. 3176 and S.B. 1731); and generally lowering the sales tax on all items (H.B. 2940 and S.B. 1477, 1937).

Income Tax

In mid-April the income tax action centered on a Democratic bill to exempt interest from savings accounts and a bipartisan bill offering a $10 credit for 1980 taxpayers, which appeared to be the only alternative to Thompson's proposed $10 dividend to be paid to 1978 taxpayers.

The interest exemption, H.B. 2847, sponsored by Rep. Roman J. Kosinski (D., Chicago), limits exemptions at $1,000. His bill has a better chance than H.B. 2892, sponsored by Rep. Mary Lou Sumner (R., Wyoming), which contains no cap. But Kosinski's bill faces opposition by S.B. 1473, sponsored by Rep. Lynn Martin (R., Rockford), whose exemption is patterned after the federal one.

The $10 credit, H.B. 3123, sponsored by Rep. John F. Leon (D., Chicago) and Rep. Robert J. Piel (R., Harvey), would be offered to 1980 taxpayers and would cost nothing to administer. Thompson's $10 dividend would go to 1978 taxpayers and would cost an estimated $1 million to administer.

Corporate Personal Property Tax replacement

On the income tax surtax which the General Assembly approved last year to replace the corporate personal property tax, the predicted business bill, S.B. 2010 (sponsored by Regner), was introduced to tie increases in revenue to increases in the cost of living. The sole Democratic alternative, H.B. 2879, sponsored by Rep. Fred J. Schraeder (D., Peoria), would cap collections at 8 percent, but that is what is expected anyway. If capping collections doesn't work, business will lobby hard for other incentives: investment credits like those in H.B. 3200 and S.B. 1757, and deductions like those in S.B. 1611 and 1933.

Property tax

Thompson's surviving property tax limitations bill, S.B. 1986, sponsored by Sen. Kenneth G. McMillan (R., Bushnell), faces only one Democratic alternative, H.B. 3134, sponsored by Schraeder. Expanding the circuit breaker (H.B. 188, 329, 547, 3204, 3238, 3436, and S.B. 967, 1338, 1517) and the homestead exemption (H.B. 2032, 2926, 2967, 2995 and S.B. 1389, 1519, 1678) had drawn little attention by mid-April.

It was the farmers who pulled the property tax publicity as the spring session opened. They lobbied hard for a new bipartisan package of House bills which would in effect freeze farmland assessments at their 1979 levels. Under the package, H.B. 2956, 2958, 3154 and 3173, co-sponsored by Rep. Larry Stuffle (D., Charleston) and Rep. Harry Woodyard (R., Chrisman), the formula for assessing farmland would include a reduction in the percentage of its fair market value, which, since the law was last changed in 1977, is included with the gross income in figuring

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assessments. Similar bills were introduced in the Senate, (S.B. 1890, 1898), but the action is expected to come in the House.

However, the farmland assessment issue has apparently divided farmers, with the Farm Bureau supporting the current formula, and others, like the Illinois Farmers Union, pushing for the revision. The exemption bills, patterned after the manufacturing incentives approved two years ago, would automatically phase out the sales tax on farm machinery over a few years (H.B. 2921, 2969, 3141 and S.B. 860, 1476).

Energy/Environment

The House passed H.B. 1182, spon sored by Rep. Ralph Dunn (R., DuQuoin), to require all public utilities to use Illinois coal, if the cost per 1,000 Btu's is cheaper, at all coal-burning facilities opened after July 1, 1982.

Financial Institutions

The House Financial Institutions Committee had already sent to the floor by mid-April a new bipartisan inflation-fighter. H.B. 3268, co-sponsored by Speaker William A. Redmond (D., Bensenville) and Ryan, would tighten credit by eliminating the ceilings on interest rates on revolving accounts. Hearings were just getting underway on bills (H.B. 2384) to streamline the electronic funds transfer systems approved last year.

Insurance

Insurance rate regulation bills surfaced in the Senate. S.B. 1553 and 1961 deal with property and casualty rates and, as expected, other bills cropped up to extend coverage (H.B. 3189, 3485 and S.B. 1814). Other insurance bills worth watching would regulate the release of information: H.B. 3369, sponsored by Rep. Elroy Sandquist (D., Chicago); bar insurance companies themselves from ruling a claim "medically unnecessary": H.B. 3390, 3391, sponsored by Rep. Bernard Epton (R., Chicago); and ban discrimination against the disabled: H.B. 1839, sponsored by Rep. Doug Kane.

Public Utilities

The cost base on which rates are approved has become the public utilities issue, at least in the House. The Illinois Commerce Commission (IllCC) wants to change the formula to include original cost of facilities in the rate base, while the utilities are apparently split on the issue, some arguing that continuing to include the replacement cost of facilities in the rate base would be more equitable. However, the utilities also want the IllCC to speed up its handling of rate cases. In effect, the utilities must sometimes wait two years from the time they receive one increase until they can ask for another. Thus, inflation often offsets the hike. Some legislators feel that switching to original cost in figure rates would expedite rate cases. H.B. 1180 (Kane), which was voted down once but is expected to eventually pass in the House Public Utilities Committee, would allow the replacement cost to be used in the rate base.

Under a related bill, H.B. 2923, sponsored by Rep. Herbert Huskey (R., Oak Lawn), the so-called construction-work-in-progress (CWIP) costs would not be used in figuring rates. The IllCC, however, has already begun to allow some CWIP costs to be included in the rate base, notably in a November decision which involved the new nuclear power plant Illinois Power is building in Clinton. Huskey's bill faces heavy opposition from the utilities, who charge that it is cheaper for their customers, in the long run, if utilities gradually increase rates to cover costs during construction than if they increased rates all at once to offset the total capital cost once construction is completed.

Predictably, revising the formula for figuring fuel adjustment clauses is the object of several bills, although most are designed to encourage the use of Illinois coal, since they would no longer allow transportation costs to be included in the formula (H.B. 3284,3393 and S.B. 1849, 1886, 1813).

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Although this year's mild winter may dim chances for the passage of anticipated bills to ban fuel shut offs during the coldest months (H.B. 842, 3205 and S.B. 1920), they may pass because of the election year.

Social Services

The long-awaited bill to revise the public aid code was introduced. Based on a two-year study by the legislative Commission to Revise and Rewrite the Public Aid Code, H.B. 3449, sponsored by Ryan and Rep. Susan Catania (R., Chicago), is described as a more complex, but tougher law than the one now on the books. It would spell out a new formula for figuring the "standard of need," which determines the amount of the basic income assistance check. The new formula would account for regional differences in the cost of housing, as well as consider the amount of medical assistance and other welfare checks already approved. And the General Assembly, rather than the Illinois Department of Public Aid, would set the size of that basic income assistance checks by designating a percentage of the standard of need when approving the Illinois Department of Public Aid's annual appropriation. The bill also redefines eligibility for medical assistance and outlines a new procedure for legislative review of the department's rules to administer the new welfare laws.

Among other significant social service legislation, the Conference of Legislative Women hailed a six-bill package as a comprehensive effort to prevent teenage pregnancy. H.B. 3214, the result of hearings held across the state, would set up early pregnancy detection programs; establish a pilot program to prevent teenage pregnancy; qualify some women in their first pregnancies for welfare; and make the Department of Public Health the umbrella agency for all teenage health care programs.

Judiciary

Voters, especially Chicago Democrats, rejected merit selection of judges when it was proposed as part of the new constitution a decade ago, but the appointment versus election issue is alive again. Senate Joint Resolution — Constitutional Amendment 25, sponsored by Sen. Dawn Clark Netsch (D., Chicago), was introduced last spring. Under an amendment added last fall, however, only supreme court and apellate court judges would be appointed, leaving circuit judges elected — unless a local referendum changed their selection to an appointive process. Netsch said the local option provision should assure passage in the legislature which has been divided on the issue along geographic lines. If approved by the legislature, the proposed constitutional amendment will be on the November ballot.

A number of bills were introduced to spell out when killing a fetus, apart from abortion, constitutes murder (H.B. 3314, 3458 and S.B. 1524) because of the Illinois Supreme Court ruling (see "Judicial Rulings," May).

Another criminal issue continues to be rape. The House passed H.B. 1711, sponsored by Rep. Aaron Jaffee (D., Skokie), which would allow a rape victim to have a "support person" seated with her at the trial of the accused rapist. Another bill, H.B. 2856, sponsored by Rep. Celeste Stiehl (R., Belleville), would allow judges to impose life sentences on rapists in certain instances.

Agriculture

As expected, bills were introduced authorizing the state to assume part of the cost of county soil surveys (H.B. 2831, 2893) and to assume part of the cost of soil erosion control by making matching funds available to local soil districts (H.B. 3305, 3394). Other conservation bills are designed as tax incentives. H.B. 3141, sponsored by Rep. Gordon L. Ropp (R., Bloomington), would exempt conservation equipment from the sales tax, while S.B. 1643, sponsored by Sen. Jeremiah Joyce (D., Chicago), would cut property tax assessments 7 percent on farmland planted with soil erosion retardant strips.

Transportation

Not surprisingly, a number of bills were introduced to encourage the use of gasohol by reducing taxes on the alternative fuel which is made from 90 percent gasoline and 10 percent ethanol or grain alcohol (H.B. 2911, 2931 and S.B. 1464, 1578). Related bills (H.B. 2866, 2920 and S.B. 1500) would require retailers to accept credit cards for gasohol if they accept them for other fuel products.

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