2025 Spring Session Wrap Up

The Spring 2025 Legislative Session came to an end in the early morning hours on Sunday, June 1st. After five months of session and over seven thousand bills filed, the Legislature passed a balanced budget and a mere four hundred twenty three bills. The Legislature has thirty days to send each bill to the Governor who then has sixty days to sign or return the bill with a veto or amendatory veto. Veto Session has been set for October...with it scheduled to be completed before Halloween. It is possible that the Legislature may return before then but we currently do not foresee that. 

As we anticipated the focus was on passing a balanced budget in a challenging year. Thus, as you will see below, there are a number of items classified: unfinished business. 

On the final day of session, SB2510, the budget appropriations bill passed, which included just over $55 billion in spending. The budget spends $118 billion between state and federal funds, with $55.2 billion coming from the General Revenue Fund. The final bill made $193 million in operational reductions, and $330 million in reductions from the elimination of the Health Benefits for Immigrant Adults program. The Governor was also granted an unprecedented grant of emergency powers. The budget bill contains a new Budget Reserve for Immediate Disbursements and Governmental Emergencies with $100 million in reserves to be used for emergencies, creating contingency funds for short-term needs and revenue gaps. No appropriation was made to the Rainy Day Fund, which sits at more than $2 billion. The budget package also includes supplemental appropriations for FY25 totaling $2.5 billion.

The second bill, HB1075, the budget implementation bill, included the substantive language required the Stare to implement the state's spending.

The third bill, HB2755, the revenue package, supports the state's budget. Among the revenue proposals in the package is a 1-year delay in the final transfer of the sales tax on motor fuel to the Road Fund. In addition, the bill also includes the following revenue proposals: Tax amnesty from October 1, 2025, through November 15, 2025; an additional sports wagering tax; removal of the hotel exemption for short-term rental hosting platforms;  Increase and expansion of the tobacco tax (45%); an increase to the telecommunications tax from 7% to 8.65% to fund the 9-8-8 suicide prevention and mental health crisis line; change of a regulation that will allow the state to collect more corporate income tax, in some instances, and; requires businesses outside of Illinois selling $100,000 or more worth of physical goods to Illinois residents to collect Illinois sales tax, even without an in-state presence.

The budget also included statewide and local capital projects. Each Democratic legislator received additional capital spending for local projects, and most of the projects that remained unfinished were reappropriated. Notable capital appropriations are $6.2B for new IDOT construction projects, including $4.5B for road and bridge construction; $300M for demolition and deferred maintenance projects at state facilities; $35M for OSLAD grants; $75M for DCEO’s prime sites business development programs, and; $50M for the Illinois Works Pre-Apprenticeship Program. There was also $500M included to make investments in the State’s surplus real property and state-owned sites to market and recruit out-of-state businesses to locate in  Illinois.

In addition, the State’s $33.7B Medicaid (State+Federal+provider tax) was conservatively funded adding just  $900,000 in costs to the program along with a number of programmatic changes. There were also a number of healthcare investments including: $120 million for safety net hospitals; $15 million in Medical Debt Relief; $24 million for reproductive health initiatives: a dedicated revenue source for the 9-8-8 mental health crisis line, and; $263 million for the Home IL program. The State-funded healthcare program for 33,000 undocumented immigrant adults aged 42-64 will be terminated on July 1st.

There were a number of issues that the legislature failed to complete before adjournment, many of which we anticipate will be completed during veto session this fall.

For example, competing proposals were introduced to address the $770 million fiscal cliff impacting the State’s public transit system, however, the state failed to pass a bill through both chambers. Although, the Senate did pass its transit bill over to the House, which included approximately $1.5B in revenue. Revenue sources to fund public transit, included a 10% tax on all ride-share rides in Cook and the Collar Counties, a $1.50 tax per delivery on package and food deliveries statewide, a fee on electric vehicle power providers, and a real estate transfer tax in Cook and the Collar Counties of $1.50 for every $500 of the sale price. However, the House did not take up the bill before adjournment.

Medical aid in dying, which authorizes the process for allowing those diagnosed with a terminal illness and given less than 6 months to live the ability to obtain a prescription to aid in dying passed the House but stalled in the Senate.

A bill regarding cannabis regulatory relief and hemp regulation was contained in a House Bill with variety of reforms, including permitting every dispensary to sell to medical patients, allowing agencies to waive fees and financial assistance for social equity licensees experiencing financial hardship, and permits drive thru and curbside pickup for all dispensaries.

The Governor also pushed for the removal of cell phones from the classroom, but the debate over this continues. Again, the bill passed the Senate but stalled in the House amid questions and concerns from various parties, including the House Black Caucus.

A much anticipated energy Omnibus Bill stalled in the House after five amendments in the final 48 hours of Session, with amendments ranging from data center requirements to bring their own renewable power, increased fees on nuclear facilities, electrification energy efficiency, and battery storage. This issue is likely to be taken up in veto session as battery storage regulations will be needed in order to meet CEJA clean energy goals.

Legislation that prohibits pharmaceutical manufacturers from imposing restrictions on hospitals, FQHCs, and pharmacies and expands access to the federal 340b program stalled in the House. The debate is likely to continue in Veto Session.

And finally, Tier 2 Pension reform never got out of the working groups. After months of negotiations and hours of meetings the parties just couldn’t find common ground to finish the issue this spring. This is likely to be taken up more fully in the spring session. There was a Tier 2 pension parity bill for Chicago Police and Fire that did pass.