Illinois’ small business community is the engine that drives our economy and local communities. Unfortunately, the failure of our political leaders to pass a responsible budget or make badly-needed reforms is hurting small businesses, devastating the state’s economy, and quickly eroding any confidence the small business community still has in our state government.
In honor of small business week, our politicians should get serious about enacting reforms that will revive the state’s economy and encourage the growth of small businesses. Policymakers should adopt the following common-sense, nonpartisan measures to improve Illinois’ fiscal health and restore confidence in our state’s economy.
Illinois’ public pension system is $111 billion in the red and one of the worst-funded pension systems in the country. This pension crisis hovers over our economy like a black cloud, consuming state revenue, driving down Illinois’ credit rating, and shrouding the business community in uncertainty. For the sake of our state, we need bold politicians willing to work with all stakeholders on pension reform that will pass constitutional muster.
One innovative reform that will immediately impact the pension crisis allows certain retirees the option of receiving a portion of their pension in a lump sum, at a discount, instead of their entire pension over time. This provides participating retirees the opportunity to invest those sums or ensure they are passed on to loved ones. At the same time, this legislation reduces the state’s pension liabilities.
Our political leaders should embrace this legislation now because, while it will not erase the entire $111 billion shortfall, it will actually reduce our pension liability and begin moving the needle in the right direction.
Workers’ compensation reform
Workers’ compensation reform is not a partisan issue. Indeed, our politicians should be working together to pass legislation that lowers the state’s high workers’ compensation premiums while providing necessary protections to injured workers.
There is a common-sense proposal that properly balances the rights of employers and injured workers. This proposal, which closely mirrors the law in over half the states in the nation, apportions causation and thereby, compensates workers for the injuries actually caused by their work-related accident. For instance, if an arbitrator determines 35% of an injury was caused at work and the remaining condition was caused by other factors, an injured worker receives compensation reflecting that percentage. This initiative should be adopted, filed in the legislature, and passed now.
Small business reforms
There are an array of pending bills and initiatives aimed at empowering the small business community, creating jobs, and sparking the economy. For years, small business owners and entrepreneurs have been fighting to lower Illinois’ LLC fees. These arbitrarily excessive fees are among the highest in the nation and depress economic development. The fees required to form an LLC, the annual renewal fees, and several others should be lowered immediately.
The small business community has also advocated for a tax system that does not favor extremely large companies threatening to leave the state. Our policymakers should level the playing field for all Illinois businesses and significantly curtail the excessive tax breaks which have been doled out to individual companies.
The General Assembly overwhelmingly passed legislation allowing Illinois companies to raise money through intrastate equity crowdfunding. This allows small businesses and local entrepreneurs to raise capital, in small increments, from many Illinoisans and in exchange, provide those investors a small amount of equity in their companies. While this important reform has already been passed into law, the state should work to pass companion legislation, such as extending the Angel Investment Tax Credit program and making it available for Illinois companies using the newly approved crowdfunding bill. The state should also work in conjunction with local business organizations to educate entrepreneurs about the opportunities associated with intrastate equity crowdfunding.
Illinois can spark its economy, create jobs, and raise revenue by passing legislation and making reforms that empower the small business community.
Political standoff must end
Small Business Week should be a call to action for small business owners and their employees across Illinois. The small business community must galvanize and demand our elected officials pass a responsible budget and make the reforms necessary to revitalize our economy.
There has never been a more important time to get engaged in Illinois politics. The more assertive the small business community gets, the less likely the state will be facing another budget crisis as Small Business Week approaches in 2017.
• Elliot Richardson is president of the Small Business Advocacy Council, based in Chicago. Reach him at firstname.lastname@example.org.
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