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* The governor took a lot of bill actions again this afternoon. Click here for the full list and his veto messages.
He vetoed the state treasurer’s bill, for instance…
Today, I return House Bill 302 with specific recommendations for change to provide a clear, constitutional threshold to help Illinois families receive insurance benefits and to stop the inappropriate payment of contingency fees to private auditing firms.
Few things are more traumatic than the death of a loved one. Life insurance provides an important resource for financial assistance after such a loss. As public servants, we have a duty to protect beneficiaries and ensure they receive the benefits they are owed. That is why I signed legislation (Public Act 99-0893) creating the Unclaimed Life Insurance Benefits Act, which took effect January 1, 2017. The Unclaimed Life Insurance Benefits Act requires life insurance companies to continually cross check in-force policies with the Social Security Administration’s Death Master File to determine potential beneficiary eligibility. If a potential match is identified and a beneficiary has not yet come forward, insurers are required to make a good faith effort to locate the beneficiary or beneficiaries and provide claim assistance.
While the current law is forward-looking for all policies in force as of January 1, 2017, HB 302 retroactively would require insurers to cross check policies that have lapsed or terminated. For those insurers with electronically searchable records, records must be searched back to 2000. However, if an insurer does not have electronically searchable records, the search must be conducted back to only 2012.
While I support the intent of this legislation, HB 302 is inequitable and potentially unconstitutional. Illinois’ administrative rules only require insurance companies to keep lapsed or terminated policy records for the current year, plus the five prior years. See Title 50, Section 901.20. Creating a two-tiered enforcement timeline creates an arbitrary and discriminatory requirement that does not uniformly impact the life insurance industry. An insurer’s obligation to comply with HB 302 should not depend on differences in its record retention policies. Such differential enforcement violates due process. See Nat’l Endowment for the Arts v. Finley, 524 U.S. 569, 588-89 (1998) (due process protects against “arbitrary and discriminatory enforcement” of legal standards). To avoid this inequitable and constitutional flaw, I support a clear and logical threshold that mirrors the current five-year administrative recordkeeping requirements so that all insurers — regardless of their record-retention policies and capabilities — are required to retroactively search for policies in force at any time on or after January 1, 2012.
Additionally, this legislation does nothing to stop the continuing overreach of private auditing firms that currently contract with the Illinois State Treasurer’s Office, and they are reaping great rewards that would otherwise benefit taxpayers. Throughout the country, including Illinois, states have retained private auditors with contingency fee arrangements for the identification of unclaimed property, including life insurance policies. The expansion of these private auditors, however, incentivizes behavior that rewards private companies at the expense of state taxpayers. One such company has made more than $20 million in finder’s fees in Illinois since 2011. That money could have (and would have under current state law) gone to pay down our state’s desperately underfunded pension liability. We should stop this practice and pursue more responsible financial arrangements. This will ensure that we are conducting searches of unclaimed property in a fiscally appropriate manner and in a way that best serves our state’s taxpayers.
* The governor also vetoed the attorney general’s bill…
Today, I veto Senate Bill 1351, which seeks to create the Student Loan Servicing Rights Act.
While the intent of this bill to support struggling student-loan borrowers is laudable, the bill, as written, encroaches on federal government’s responsibilities and would add confusion to the already complex student loan process.
This legislation would require servicers to be licensed by the state, adding another layer of Illinois state bureaucracy without any guarantee the change would improve service. In fact, this requirement may push smaller servicers out of business. The recent U.S. Department of Education decisions regarding student-loan borrowers have been cause for concern. Therefore, my staff will continue to work with the department and members of Congress to address these concerns as the federal government moves to reauthorize the Higher Education Act.
Students do need additional support in understanding their loan repayment options, but loan servicers are not the appropriate actors for the role. Instead of adding another layer of state bureaucracy in the form of a student loan ombudsman, the General Assembly should consider allocating those funds to nonprofit counselors who are far more effective at advising students than any government agency.
There are several important components of the Student Loan Bill of Rights contained in SB 1351. Students should not be defrauded – purposely or through incompetence – by their loan servicer. I urge the sponsors to work with members of the Department of Education and my office to ensure a set of common-sense student protections that will not conflict with evolving federal regulations and to craft a more narrowly tailored bill to support student-loan borrowers in Illinois. Therefore, pursuant to Section 9(b) of Article IV of the Illinois Constitution of 1970, I hereby return Senate Bill 1351 entitled “AN ACT concerning education,” with the foregoing objections, vetoed in its entirety.
* He also vetoed this one…
Today, I veto Senate Bill 1720, which would make failure to pay wages a Class 4 felony instead of a misdemeanor.
Every worker is legally entitled to wages earned, and there should be penalties for employers who fail to make due on wages owed. However, there is little evidence that the current system of making failure to pay wages a misdemeanor requires a major shift to making it a felony.
* And this one…
Today, I veto Senate Bill 1714, which would add reporting requirements for consultants retained by retirement system, pension fund, or investment boards.
This legislation is a classic example of multiplying red tape without first demonstrating any benefit. Retirement system, pension fund, and investment boards all hire consultants to help identify investment opportunities. Under this bill, all consultants now will have to report to the boards that hired them on their engagement with investment services provided by a minority-owned business, a female-owned business, or a business owned by a person with a disability.
* Then there’s this one…
Today, I veto House Bill 2462, which would prohibit employers from enquiring about previous salary and compensation of prospective employees.
The gender wage gap must be eliminated, and I strongly support wage equality. Massachusetts already has established a best-in-the-country approach to the issue of employers inquiring about salary history. Illinois should model its legal regime on Massachusetts’ model.
* And this one…
Today, I veto HB 1797, which would remit the $15 million debt owed by the Illinois International Port Authority to the State of Illinois. HB 1797 is requesting the State of Illinois absolve the port authority of its debt with no clear plan for future profitability.
Furthermore, the International Port Authority was cited in 2013 by the Illinois Auditor General for numerous findings, indicating reasons for limited profitability through financial and ineffective governance. Additionally, Auditor General Holland cited the port authority for a nonexistent, long-term plan for economic development of water or rail to pay the debt owed to Illinois. This bill does not address the broken aspects driving the port district’s current financial instability, but instead masks the endemic problems with false hopes of increased economic opportunities.
The Illinois taxpayers deserve transformational changes at the International Port Authority before we should consider forgiving this debt. Internationally, new port management models have been created to deliver greater private sector participation and investment in ports. New management models could increase port utilization and create new jobs, while reducing operating costs and eliminating risks to the taxpayers. I look forward to working with the International Port Authority and the City of Chicago to find a solution to benefit the people of Illinois and our economy in the near future.
* And…
Today, I veto House Bill 2525, which addresses Illinois’ Workers’ Compensation System.
Illinois remains in a fiscal and economic crisis that taxes and regulations cannot solve. The only way to truly improve our state’s financial status is to grow our economy through the creation of jobs and opportunity. Our workers’ compensation insurance is one of the most expensive in the nation, and the statutory scheme underlying these costs is riddled with problems and stakeholders that stand in the way of getting injured employees back to health and encouraging employers to invest in Illinois again. We need thoughtful reform of this system, and we must focus our efforts on solutions that encourage economic growth while also making sure we are providing efficient and effective care to injured workers.
Unfortunately, this bill does not make the changes necessary to achieve those goals. It fails to acknowledge the cost-drivers that are putting our state at a competitive disadvantage for jobs and growth. Instead, it imposes additional regulatory structures where they are not needed.
This legislation does not represent real reform. It does not address the competitive disadvantages that are resulting in the disappearance of jobs in our manufacturing sector, where middle-class workers once could find opportunities for growth and advancement. It will not stop the flood of hardworking individuals who are leaving our state when these opportunities are lacking.
* And…
Today, I veto House Bill 2567, which creates the Automobile Dealers’ License Task Force to study licensing and oversight of nontraditional vehicle dealers in Illinois.
Regulations for vehicle dealers in Illinois must be fair for traditional and nontraditional vehicle dealers. However, this bill excludes nontraditional vehicle dealers from participating on this new task force. Instead of creating a task force comprised of a diverse representation of the automobile dealers industry, this task force only welcomes traditional industry groups to have a seat at the table in this discussion. Unfortunately, this one-sided approach could facilitate damaging public policy that protects traditional automobile dealers at the expense of nontraditional dealers and, potentially, consumer and market preferences.
Illinois must encourage competition and innovation, which means embracing traditional and nontraditional business models that provide value to the people of Illinois. That requires including diverse perspectives and inviting traditional and nontraditional entities to have a say in market regulations, which this bill does not accomplish.
* And…
Today, I veto House Bill 3897 from the 100th General Assembly, which will impose a new regulatory burden on Illinois businesses.
House Bill 3897 would create a new mandate on businesses throughout Illinois. The State of Illinois already suffers from a bloated administrative code. Illinoisans will spend at least $250 million in direct license fee costs and fill out more than 4 million pages of paperwork for state agencies over the next decade. Miring small and new businesses in red tape hinders their growth and makes Illinois less competitive than its peers.
In the face of a swollen administrative state, all new legislation mandating more rules and regulations should be held to the highest scrutiny. House Bill 3897 fails to pass this test.
That one was about trampoline safety.
* And…
Today, I veto Senate Bill 41 from the 100th General Assembly, which allows municipalities to assign, sell, or transfer their interest in funds received from the State.
Illinois is suffering from one of the most mismanaged and overburdened public finance systems; ranking second worst in the United States by independent outlets. This bill would create a moral hazard that encourages additional borrowing at the local level, while prioritizing bonded debt at municipalities over the provision of services.
…Adding… The provisions of SB41 was in the BIMP bill, which is now law. So the veto means nothing.
There were others, so click here. I’ll post reacts on another post.
posted by Rich Miller
Friday, Aug 25, 17 @ 5:03 pm
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