After deadlock on the Environment and Land Use Committee, zoning ordinances for marijuana-related businesses in unincorporated areas of Champaign County are going to the board for vote. Proponents laud the potential tax windfall from potential businesses, while opponents fear children will be tempted to use the drug.
Lets consider the
facts. Illinois legalized recreational marijuana earlier this year.
The Champaign Board voted to tax marijuana-related businesses.
Selling marijuana to minors will continue to be illegal. Even if
marijuana sale is disallowed in these communities, citizens will be
able to purchase marijuana elsewhere; Champaign and Urbana are only a
short drives away.
The Champaign County
Libertarian Party supports the right of people to choose for
themselves what to do with their bodies. We support businesses and
markets and the consensual exchange of goods. In light of evidence
against increase youth usage in case studies around the US, we see no
downside to allowing marijuana businesses. For these reasons, the
Champaign County Libertarian Party urges board members to vote in
support of pro-marijuana zoning ordinances.
Note: This new blog series will address, from a Libertarian perspective, policy issues facing Champaign County residents, and those of Illinois state more broadly. It will examine upcoming or recently passed laws, and inform you about how your elected officials voted on them.
Campaign season 2020 is underway in Champaign County: mailers are arriving by foot carried by the faithful letter carriers, political swag is beginning to fly off tables at local events, and yard signs will soon begin sprouting in lawns all around town. At least one such mailer detailing Rep. Carol Ammons’ agenda and key legislative record has already been making the rounds. I thought this would be a good chance to reflect on her representation and voting record over the 2019-2020 term to date.
Rep. Ammons has been an ally on two issues that Libertarians care about deeply; namely, criminal justice reform and legalization of recreational marijuana use (see Sec. 1.7 of the LP party platform here). I applaud her efforts to provide transparency of public complaints of policing (HB2503), work to improve independent legal review of the polygraph process (HB2569), support for lowering the burden of appearing in court for persons held in State confinement (SB1890), and creation of criminal ramifications for law enforcement officials guilty of fraud (HB2112, HB2111). She also co-sponsored the recently passed bill legalizing recreational marijuana use in Illinois (HB0902), which was a landmark achievement in US legalization efforts in that it provides provisions to free non-violent drug offenders.
That said, much of her voting record has been in opposition to the values of liberty, freedom to operate, personal choice, smaller government, and fiscal responsibility. As evidence, I will briefly review bills she has supported — and explicitly calls out in her flyer — as they represent examples of the worst type of government.
Rep. Ammons supported the “Prescription Drug Pricing Transparency Act” which places new regulations on the healthcare industry within the State of Illinois at a time when health insurance costs continue to rise at rates greatly outpacing income and GDP growth. HB 156 burdens insurance provides with reporting requirements related to prescription drug coverage. Additionally, the law requires drug manufactures to provide justifications for increases in drug prices. While on the one hand this legislation does not change the right of manufacturers and insurers to price costs of insurance, it is clearly meant to publicly shame companies for their business practices.
Enter HB 471, a bill that amends the “Illinois Insurance Code” which empowers the State to reject ACA health insurance premium rate increase. By nebulously defining “unreasonable rate increases” it essentially allows the state to impose price controls on health insurance plans. Many might think this is good policy considering the rapidly rising health insurance costs; however, this bill will likely decrease choice among an already sparsely populated market. Insurer participation in the health exchange marketplace has continually dropped since the passage of the ACA from a peak of 5 insurers on average in 2015 to 2.35 in 2019, and as things stand today 15% of Illinois enrollees only have a single insurer option . This is unsurprising considering the high costs of compliance. Price controls will only exacerbate the problem. As a case study, Land of Lincoln Health closed operations in 2016 after $7.1M in losses, despite $160M in government grants . Along with decreasing choices, enrollment in the exchange has been declining at a rate between 7% and 9% per year from 2016 to 2018 . I highly doubt adding price controls will solve these problems, and my prediction is that HB 471 will eventually require further Illinois subsidies to prop up failing marketplace plans.
In economic policy areas, Rep. Ammons voted for efforts that will weaken employment in Illinois, while raising overall State spending. She supported the “Lifting Up Illinois Working Family Act” (SB 1) that increases the minimum wage to $15/hour over 5 years, the bloated appropriates bill (SB 262) which adds between $574M and $1.3B to the state deficit , and an amendment to the Illinois tax code (SB 687) that raises corporate tax rates by a percentage point and creates a steep progressive income tax. While individuals and families making less than $100K per year will see similar or slightly reduced tax rates, higher earners will face steep taxes ranging from 7.75% to 7.99%. This is the second tax increase in four years, after the increase from 3.75% to 4.95% in 2017.
Ramifications of Illinois corporate and individual taxes have been felt for years. Corporations have been leaving Illinois for years  due to high costs of business as have individuals . In fact, Illinois has the second highest rate of emigration surpassed only by New Jersey, based on data from moving companies [7,8]. This trend will likely continue given the increased corporate and individual tax rate increases, resulting in worsening financial situation within the state.
To put a cherry on the cake, Rep. Ammons supported broad subsidies for R&D and apprenticeships via SB 1591 and SB 191. The former amends the Illinois tax code to extend R&D tax credits to 2027 of up to 6.5% for certain expenses and creates and Apprenticeship Tax Credit of $3500 per employee (up to $5M per company!). While innovation is important, rather than increasing tax rates followed by subsidies, why not just let businesses keep more of their money? The latter bill creates a “21st Century Employment” grant program for community colleges that requires the state to pay at least 60% of proposed training costs. While no specific dollar amount is allocated for the training program—which is itself irresponsible governance—we can estimate the deficit due to the apprenticeship tax credits of up to $48.7M (based on the 13,900 apprenticeships identified in a 2016 report ). Rather than require the State to sponsor apprenticeships, why not let the plethora of unions in Illinois pay for them? That is part of their raison d’etre after all.
Overall, these hallmark proposals
supported by Rep. Ammons are misguided. They include bad governance, increased
regulations and price controls, tax hikes, and payments to special interests. I
expect this will result in decreased competition, further flight of taxpaying
corporations and individuals alike, and a worsening condition in Illinois. I
give Rep. Ammons a D- for the
2019-2020 term so far.