ILLINOIS GOVERNOR BLAGO.--INCREASES TAXES AFTER PROMISE NOT TO(demonRat doublespeak)

Professional Independent Insurance Agents of IL ^ | June 19, 2003 | Professional Independent Insurance Agents of IL

[cherry_bomb88]

Session Review

With democrats in control of both chambers of the General Assembly and the Governor's office for the first time in almost three decades, the business and insurance industries were rightfully concerned about the prospects for dozens of anti-business proposals being enacted into law, as happened in the mid seventies under then-Governor Dan Walker. After a tumultuous six-month session, the results are a mixed bag-restraint on several anti-business substantive proposals, but significant increases in taxes and fees paid by businesses, insurers and insurance producers.

On the positive side, HB 1191-Sunshine in Litigation, the Illinois Trial Lawyers' proposal to open all civil litigation settlements for examination was not called for a third reading vote in the Senate. In addition, legislation reenacting Illinois Structural Work Act was never introduced. However, the prospect for both proposals to come up this fall or next spring remains strong. Democrats will be in control of the Governor's office and General Assembly for the foreseeable future and the proponents of these issues will undoubtedly continue advocating for their passage.

Take the time this summer and fall to remind your state legislators that these proposals will ensure that more businesses will leave Illinois and the cost of doing business, and insuring it, will go up for those who stay.

For the PIIAI, all four of our legislative initiatives are on the Governor's desk including restrictions on insurers use of credit scoring, revisions to the commercial renewal/nonrenewal statute, significant changes in the surplus lines law and a bill mandating that loss runs be sent to the producer at the request of the insured.

On the negative side, the Blagojevich administration enacted several one-time revenue schemes, including bonding the public pension fund contributions and selling the 10th casino license, in addition to permanent fee increases that will impact consumers across the board.

For the insurance industry specifically, the initial proposal literally doubled every fee and penalty in the insurance code, including the individual producer license fee and the business entity (agency) fee.

The PIIAI and the industry argued strenuously against the proposed fee and penalty increases, which we pointed out, would negatively impact individual consumers and businesses in an existing hard market. When it became apparent that no industry, including insurance, would escape higher fees, we lobbied successfully in substantially decreasing the impact upon insurance producers. Instead of a $150 increase across the board, PIIAI was able to negotiate a $30 increase in the individual two-year license for residents and a $100 increase for non-residents.

FEE SCHEDULE

TYPE CURRENT GOVERNOR'S PROPOSED FINAL (SB 1903)

Individual Producer License (CURRENT)$150 for 2 yr. license (PROPOSED)$300 for 2 yr. license
(FINAL CHANGE IN LAW)$180 for resident 2 yr. license and $250 for nonresident 2 yr. license

Temporary Ins. Producer(current) $25 for 2 yr. license (proposed)$50 for 2 yr. license (final)$50 for 2 yr. license
Business Entity (current)$50 for 2 yr. license (proposed)$300 for 2 yr. license(final) $150 for 2 yr. license
Limited Lines License (current)$25 for 2 yr. license(proposed) $50 for 2 yr. license (final) $50 for 2 yr. license
Surplus Lines License(current) $200 annual license (proposed)$400 annual license (final) $400 annual license
Public Adjuster (current)$30 annual license (proposed)$100 annual license(final) $100 annual license
Premium Finance(current) $200 annual license (proposed)$400 annual license (final) $400 annual license
Employee Leasing Company (current)$500 annual license (proposed)$1,000 annual license (final)$1,000 annual license

In addition, the insurance industry was hit with several other fee increases and elimination of tax offsets.

These include:

Motor Vehicle Reports: Doubling from $6 to $12 MVR fees, which are collected by the Secretary of State.
Financial Regulatory Fees: The Governor and General Assembly increased the fees by 50% and increased the Affiliated Group Maximum from $100,000 to $250,000 (Financial Regulatory Fees are those paid by the companies to cover the cost of DOI financial audits.)
Life & Health Insurance Guarantee Fund Tax Offset: The Governor and General Assembly eliminated the existing state tax offset that life and health insurers receive on assessments from the Life & Health Guarantee Fund.
Surcharge on Work Comp Premiums: A 1.5% surcharge on Work Comp Premiums and a 0.045% payroll tax on self-insureds to fund the Industrial Commission.
Increase in the Surplus Lines Tax: Increasing the surplus lines tax from 3% to 3.5%.
Increase in Securities Fees: Several increases in securities licensing and filing fees.

The FY04 budget will impact every individual and business insured, and you and your agency should take the proactive position of informing your insureds that as a result of the aforementioned increases the cost of providing their insurance coverage will increase.

[cherry_bomb88]

I apologize that this is "insurance industry" related, however this is from an article in the bi-weekly newsletter the trade association I work for puts out to our members....it is just an example of the kinds of taxing increases that the governor put on business. He thinks consumers aren't smart enough to realize that means a trickle down tax to them.

Our lobbyist was able to do an outstanding job, considering the state house & congress are both overwhelmingly democrat and were lobbied heavy by the trial lawyers' association, in keeping increases lower than what they had proposed.

[cherry_bomb88]

((((((((((((((((((ILLINOIS PING!!!!!!!!!!!!)))))))))))))

Come see what our squirrely governor (Daley's Puppet) is up to now....back door tax increases abound for all!!!!!

Please ping those in IL that I may have left off!

[cherry_bomb88]

We have such a wonderful squirrely little governor here in Illinois!!!

[lizma]

Wasn't Boeing considering relocating to Chicago? Best they rethink that.

[cherry_bomb88]

unfortunately MANY businesses will be rethinking that which means higher unemployment and welfare class...oh wait, what was I thinking...that means a broader voter base for the DemonRats!

[Ford Fairlane]

Isn't he on some statewide tour now telling everyone how much good he is doing for us??

[cherry_bomb88]

Ummm, yeah, kinda like Hillary's "non fiction" book tour, huh????

I'd like to FReep Blago!!! To me that'd be more productive than FReeping the HildaBeast.

[Endeavor]

Bagoshits is a disaster. Even my liberal friends seriously dislike him. This will be the longest 4 years of our lives.

[cherry_bomb88]

I was half teasing our lobbyist at dinner tonight and said we could do what California is doing...he said our laws are much stricter here, it'd never work (dang....have to think of something else!).

[JustPiper]

Daley's Puppet is right friend! And just think the other day Blago was getting such high marks (spit)

[chicagolady]

O'MALLEY FOR GOVERNOR!..............2006!!!!!!!

[Lazamataz]

I am so freakin' glad I am out of that s**thole.

[TheRightGuy]

I am so freakin' glad I am out of that s**thole.

But you can still come back to Illinois! ;^)

[TheRightGuy]

This will be the longest 4 years of our lives.

Thanks, in large part, to the numerous Illinois FReepers who were too ideological to simply hold their noses and vote for Jim Ryan.

[Skywalk]

Licenses to do work. Permission from government.

Don't sound much like a free market or a free people to me.

[Lazamataz]

But you can still come back to Illinois! ;^)

LOL! You are bad! :^D

[cherry_bomb88]

I can understand the need to license certain professions to maintain a level of ethics and have a way to keep out (or kick out) unethical people...ie: attorneys, doctors, realtors & yes even insurance agents.

They all have an effect on the public's well-being and good....however, a 300% increase in one's fees???? How hard would the average tax payer be fighting if their personal income tax went up 300%????

[cherry_bomb88]

TRG....I'd have to whole-heartedly agree with you.

[Skywalk]

Agreed on the increase.

As for licenses, I actually DON'T think they are necessary. Look at what requires a license these days, just about any profession that can be called a trade. Heck a food handler's permit in Washington? Come on.

The fact is, vast corruption and terrible ethics are a TRADEMARK of much of the licensed professions at this point. No, I don't hate all the lawyers, my mom is one(not practicing though) but the negatives have crept in anyway. That kind of eliminates the argument altogether.

I would have less problem with a free market alternative, where credibility was established by 1-3 licensing commissions, and they decided their own prices and standards. The consumer should make themselves knowledgeable, and if the guy is certified by X Commission then you know you can have a base level of trust.

The real problem with these licenses is there is no alternative. You can be ARRESTED or fined for NOT having them, as opposed to having them to establish greater market appeal and standards. That includes being a hairdresser in some places.

Another is that the bar and medical associations are merely cartels that artificially reduce the total entrants into their field and/or inflate the costs to do business in those sectors, even if its something a paralegal or nurse can handle. State-sponsored cartels ain't my bag, baby.

Laws against fraud, various violations of contract and criminal negligence would still apply, so it's not like we'd see all these people being fooled by fake Harvard diplomas and allowing someone to operate on their brain.

[Endeavor]

I proudly voted for Jim Ryan. I'm very concerned about Fitzgerald's senate seat.