Tuesday, April 28, 2015

Governor Rauner’s Controversial “Turnaround Agenda”

Over the past month, Governor Bruce Rauner has been meeting with local government officials around the state in an effort to promote his “Turnaround Agenda.” The Agenda, which proposes sweeping changes to the laws affecting local governments, has been controversial. Last Tuesday, union supporters turned out in force at a Naperville City Council meeting in which the proposal was on the agenda.

While Rauner’s Turnaround Agenda proposes a number of changes, the three that would most impact local governments are: 1) the creation of “local employee empowerment zones;” 2) the abolishment of the state’s prevailing wage requirements; and 3) a property tax freeze. 

Rauner’s “local employee empowerment zones” would allow a unit of local government (i.e. a municipality, school district, township, etc.) to decide whether its employees have the right to join, or refrain from joining, a union. Essentially, this legislation would permit local governments to implement right-to-work ordinances. This means that if a county were to implement a local employee empowerment zone, then all employees in the county, including those in both the public and private sectors, would be permitted to refuse to pay union dues. 

Another proposal in Rauner’s Turnaround Agenda which would significantly impact local governments is the proposed abolishment of the state’s prevailing wage requirements. The Prevailing Wage Act requires all contractors and subcontractors on public projects to pay their workers according to a designated rate that is near the union scale. Rauner argues that this drives up the price of public works projects around the state, wasting taxpayer money. His Turnaround Agenda would repeal this Act, allowing contractors and subcontractors to pay employees any wage above the state minimum. 

Rauner’s Turnaround Agenda also seeks to impose a property tax freeze. The Agenda seeks legislation that would only allow property taxes to be increased after a referendum has been approved. 

The Turnaround Agenda also seeks to increase the minimum wage to $10/hr by 2022, reduce worker’s compensation awards, and provide stronger fraud provisions and penalties in the Unemployment Insurance Act.  The Agenda would also allow municipalities to file bankruptcy under federal bankruptcy laws, and combine the offices of state comptroller and treasurer. Moreover, the Agenda seeks to impose term limits of ten years on state legislators, a shot across the bow at Speaker Madigan and Senate President Cullerton, Rauner’s political enemies. 

Whether this sweeping series of changes meets with success in Springfield remains to be seen. So far, few legislators have publicly endorsed it. If Rauner were able to implement even a few of these proposals, it would have a dramatic effect on the operation of local government. Stay tuned to The Workplace Report for updates on the status of this legislation.