CSG Midwest
An ESOP is a type of tax-qualified retirement plan, one that states such as Iowa have identified as a tool for helping retain businesses when owners decide to sell some or all of their interests in a company.
Here is how an ESOP generally works: A privately held company contributes its stock, or money to buy its stock, to a retirement plan for employees. Each worker participating in the plan has his or her own account, and an ESOP trust is created to hold these shares of company stock. ESOPs can be a mechanism for allowing partial or full ownership of a privately held company to be transferred to employees (when the owner retires, for example). In contrast, the sale of a business to an outside entity increases the risk of lost jobs.
According to the National Center for Employee Ownership, other potential benefits of ESOPs include improving retirement security, reducing a company’s tax burden, bolstering worker morale, and giving employees a voice in management. Since the passage of legislation in 2012 (HF 2465), Iowa has provided a tax incentive to encourage the sale of in-state businesses to employees: Owners get a 50 percent deduction from income taxes on any net gains from the sale; the transaction must result in the employees (via the ESOP) owning at least 30 percent of the company. Iowa also reimburses 50 percent of the costs for businesses that conduct studies on the feasibility of setting up an ESOP.
CSG Midwest
In May, trends in U.S. unemployment appeared to take a positive turn, one unexpected by many economists. And as the Midwest’s legislators learned on a webinar that same month, changes in this closely watched economic indicator have huge impacts on states’ bottom lines.
“When the national unemployment rate goes up by one percentage point, there are budget shortfalls across all states of about $45 billion,” Michael Horrigan, president of the W.E. Upjohn Institute for Employment Research, said during the webinar hosted by the Midwestern Legislative Conference Economic Development Committee.
“The other estimate that we’ve come up with is that if a state unemployment rate goes up by one percentage point, states lose about 7 percent in tax revenue.”
Though the May numbers were promising — the result of factors such as the end of stay-at-home orders, business reopenings and an influx of federal dollars that, in part, encouraged businesses to retain workers — unemployment rates remain historically high.
CSG Midwest
Amid widespread protests and calls for change in response to the May 25 killing of George Floyd by police in Minneapolis, the push for state-level legislative reforms has intensified. Here is a look at some of the bills and policy proposals in three Midwestern states: Minnesota, Michigan and Iowa.
CSG Midwest
To get three major pieces of legislation passed with unanimous or near-unanimous votes can be a challenge at any time. In Minnesota this year, lawmakers found a way to get that done in agriculture policy under some unforeseen, exceptional circumstances — having to conduct business remotely, and in a Legislature where partisan control is split.
“By building relationships across the aisle, in the other chamber and with staff, we were able to identify everyone’s priorities and get to the right end results,” says Rep. Jeanne Poppe, who serves as the chair of the House Committee on Agriculture and Food Finance and Policy.
Perhaps the most impactful and unique piece of legislation — especially considering economic conditions in the agricultural sector — was a modification of Minnesota’s Farmer-Lender Mediation Act. This law dates back to 1986, and it gives farmers the opportunity to renegotiate, restructure or resolve farm debt through mediation.
CSG Midwest
In the weeks leading up to Nov. 3, Illinois will be preparing for a general election expected to be like none other in the state’s history. That date will be a state holiday, in part to help secure alternative polling sites as some locations become unavailable due to pandemic-related health concerns. On Election Day, individuals as young as age 16 will be poll workers, and election officials will have the authority to administer curbside voting.
And perhaps most noteworthy of all, the state is likely to have a huge jump in the number of people who vote by mail. Every person who has voted over the past two years will receive a mailing to make them aware of this option, and then will receive an absentee-ballot application.
All of those changes are the result of SB 1863, legislation passed earlier this year to help authorities in Illinois conduct an election in the midst of a public health crisis, the COVID-19 pandemic. “The law is for one year only, and that gave people more comfort in knowing that it was a one-time change,” says Illinois Sen. Julie Morrison, who helped lead legislative efforts on SB 1863.
Across the Midwest, big changes already have occurred in 2020, the result of primaries being held when people were being told to socially distance, avoid crowds and stay home whenever possible.

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The PLRA contains a...

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