Shalom Klein’s Blog

The US Chamber of Commerce and a coalition of financial services groups sued to stop the Department of Labor’s (DOL) new rule setting stricter regulations on retirement investment advice. The groups say the DOL “overstepped its legal authority” and would threaten middle-class individuals’ access to investment advice. The House and Senate both voted in favor of a resolution to block the rule, but President Obama is expected to veto it. At this point, it is not clear whether Congress will step in to clarify the rule and alter the regulation, if the rule will be blocked, or if it will be implemented as is. Read more in Morning Consult.

Republicans and Wall Street interests are pushing for changes to the Consumer Financial Protection Bureau in the House Financial Services draft appropriations bill. “Partisan gridlock is likely to thwart any substantive changes to the 2010 Dodd-Frank financial law, but messaging amendments from both sides should grab the spotlight if the full House Appropriations Committee takes up the bill.” Read more in Roll Call.

It appears the Federal Aviation Administration (FAA) will have to make due with another short-term spending bill since legislators are at an impasse over its reauthorization. House Republicans are pushing to transform it into a nonprofit corporation, but Senators from both parties are not on board with the idea. Congressional staffers and airline industry officials expect that a stopgap funding bill, continuing the FAA’s current spending levels, will be the only way forward in the near future. Read more.

Without any fanfare, the White House Office of Management and Budget removed several provisions related to flavored tobacco products from the FDA’s recently-finalized rule. The FDA extended its authority to cover more products, including e-cigarettes, and required all manufacturers to submit marketing applications for their products. Manufacturers of flavored products would only have a 90-day grace period before being required to submit their applications, and another 90 days before needing to pull their products off the shelves if authorization had not come through. The FDA’s rationale for targeting flavored products is that they are designed to appeal to children. The OMB deleted both the provision and the explanation from the final rule, which goes into effect in August. Manufacturers of all newly-covered tobacco products will have a two-year grace period to submit their marketing applications and one additional year to continue selling them while the FDA reviews the applications. Read more from Reuters.

A US District Court judge ordered documents related to a case against Donald Trump’s Trump University to be unsealed. The case alleges that the school, which purports to teach students Trump’s real estate investment strategies, misled people paying thousands of dollars for seminars. The judge then tried to reseal some of the records, saying he had “mistakenly” released some information that was supposed to be redacted. At this point, however, plenty of news organizations have the full document release, which includes instructions to staff on collecting student financial information to determine who could afford more classes and how to pressure potential students into purchasing $35,000 seminars. Trump has been trying to distance himself from the school, saying he was not involved in its day-to-day operations or strategies. Wide-ranging perspectives from current and former staff make that difficult to gauge, butpolitical opponents are having a field day with the information. Read more in Politico here and here.

House Speaker Paul Ryan’s primary opponent, Wisconsin businessman Paul Nehlen, claims to have more than twice the required number of signatures to appear on the ballot. Nehlen is taking advantage of Speaker Ryan’s wariness of Trump, now the party’s official nominee, to gain the support of far-right conservatives like former Gov. Sarah Palin. Speaker Ryan has now come out in support of Trump, and his fundraising and popularity are still far ahead of Nehlen’s, but nothing is certain in this political climate. Read more in Morning Consult.

Democrats are divided over whether Sen. Bernie Sanders should stay in the presidential race or drop out. Senate Minority Leader Harry Reid is an advocate of the latter option, saying, “Sometimes you just have to give up.”Others want Sen. Sanders to stay in the race because his presence and support have been forcing Hillary Clinton to move slightly to the left in her policy positions. She is still not a 100% guarantee for the nomination, but it is looking more likely every day.

Gov. Rauner has been increasing his anti-Chicago rhetoric as he tours Downstate towns. He referred to downstate communities as “hardworking families who pay the taxes” and should not “bail out Chicago.” Chicago Alderman Howard Brookins, Jr. responded, “I’m appalled that Governor Rauner would say that Chicago families are not hardworking and don’t contribute to the tax base of Illinois. In fact, we pay a larger percentage of our incomes in taxes than the Governor or his billionaire friends.” Mayor Emanuel and Chicago Public Schools CEO Forrest Claypool also responded, criticizing the comments for “pitting Illinois regions against each other.” This fight just keeps getting uglier. Read more on Capitol Fax here and here.

Gov. Rauner lost the first true veto override vote since he took office. He vetoed a bill to restructure payments in the Chicago fire and police pension systems, which had already been done in other parts of the state and was strongly supported by Mayor Emanuel. Democrats and a handful of Republicans voted to override the veto, however, and this time the governor had not lifted his opposition prior to the vote. Without this legislation, Chicago’s property taxes would have needed to go up considerably to pay for the existing pension system. Reporter Natasha Korecki explains another facet of the pension bill: “By coming to the mayor’s rescue, Madigan and Cullerton have sent the message that they are the allies who will stand up for Chicago.”

Chicago’s Independent Police Review Board (IAPB) released hundreds of audio and video files related to investigations into police misconduct this morning, marking “an unprecedented shift toward transparency.” The IAPB has launched a searchable public database of information, audio, and video connected to ongoing investigations. This is the Emanuel administration’s latest response to the public outcry over the secrecy surrounding police shootings, notably the Laquan McDonald case that sparked widespread protests and, eventually, change. Read more in the Tribune.

Mayor Emanuel may soon have an email scandal of his own since a Cook County Circuit judge ruled that emails and texts on his personal devices are not automatically exempt from the Illinois Freedom of Information Act. The Tribune requested such communications in a suit last year, and this judge just struck down the Mayor’s defense against releasing them. Read more.

SB 10, sponsored in the House by Rep. Lou Lang, passed both houses. The bill would extend the medical marijuana pilot program through 2020 instead of allowing it to expire at the end of next year, and it would add more health conditions to the program. The bill would also only require patients to register for new cards every three years instead of every year, and it would open new pathways for patients to become certified for the program.

Rep. Sara Feigenholtz’s HB 5009 passed both houses. The bill would add specialized mental health rehabilitation facilities to the definition of Long Term Care Facility in the Illinois Act on the Aging, and it would change rules for provisional licenses for such facilities.

Federal investigators are looking into Assembly Speaker Carl Heastie’s transactions from his time as the chairman of the Bronx Democratic Party from 2008-2015. They have subpoenaed the treasurer of the committee, state Rep. Michael Benedetto, and requested information on all reimbursements made to Speaker Heastie. Rep. Benedetto complied and said, “I can’t remember writing one check I thought was in any way irregular.”  There are several questions and missing pieces of information related to the committee’s activities during Speaker Heastie’s tenure, as well as possibly improper expenditures from the legislator’s Assembly campaign account. Read more.

Hasidic Jewish communities continue to face obstacles in developing housing in New York suburbs. The latest example is the town of Mamakating in Sullivan County, where the planning board has threatened to rescind its approval of a housing project, claiming that the developer was misleading about how many people would live in the homes. The developer of the Villages of Chestnut Ridge denies this allegation and accuses the town of religious discrimination. This latest move comes after the release of previously-confidential documents related to the project. Read an article in the Wall Street Journal here, and a piece co-written by S4’s Michael Fragin here.

The Transportation Trust Fund (TTF), which covers roads, bridges, and other transportation projects, is going to run out of money by early August, and Gov. Christie is still vehemently opposed to raising the state’s gas tax, which would help shore up the fund. Instead, he told legislators to reduce spending elsewhere and fund the TTF from the General Fund. According to Politico New Jersey, the fund currently spends $1.6 billion per year and has so much debt that the current gas tax revenue cannot support more spending or bond offerings, so funding it solely from the General Fund would require dramatic cuts to other programs.Read more.

The Assembly Judiciary Committee will vote on Monday on whether to propose a constitutional amendment requiring quarterly pension payments to voters this November. Since the resolution passed both houses last session, only a simple majority is needed to put the question on the ballot. Republicans and business groups oppose the measure, fearing that the payment requirement could threaten the state’s credit rating and take away from other spending priorities. Read more in Politico New Jersey.

A bill to add PTSD to the list of conditions that can be treated with medical marijuana advanced out of the Assembly Regulatory Oversight Committee and will be taken up in the full Assembly. Although a similar bill passed the Assembly but failed in the Senate last year, the bill’s sponsor and other supporters are optimistic that it will pass this year. “There’s been more research on its efficacy,” sponsoring Rep. Tim Eustace explained. The governor has not changed his public rhetoric in opposition to medical marijuana, but supporters are hopeful that the new research will encourage him to at least add PTSD to the program. Read more.

The state Supreme Court will consider whether to amend laws related to attorney conduct to clarify that attorneys will not face penalties for advising clients who grow medical marijuana. “Lawyers typically face penalties up to disbarment if they advise their clients to break any law — local, state or federal. But the Supreme Court’s Advisory Committee on Professional Ethics recommended this month that the justices allow an exception for lawyers helping clients navigate New Jersey’s medical marijuana regulations.” So far it does not seem that any lawyers have faced disciplinary charges, but many are afraid of the consequences of assisting those in an industry that is still illegal at the federal level. Read more.

Gov. Kasich signed a bill that eliminates the state’s alcohol by volume (ABV) limit for beer, opening the market up to a wider variety of craft beers. Legislators and the governor want to support the growing craft beer industry and keep customers in the state. Read more.

Former Ohio Attorney General and current director of the federal Consumer Financial Protection Bureau (CFPB) Richard Cordray has not announced whether he will fun for governor, but a PAC called Protect America’s Consumers already has attack ads to stop him. Since Cordray cannot actually campaign until the end of his term at the CFPB in summer 2018, the opposition is an odd move. According to Jessica Wehrman in the Columbus Dispatch, ““Protect America’s Consumers” appears to be fighting on two levels: They want to fight the agency, which many Republicans say lacks accountability. And they wouldn’t mind thwarting Cordray’spolitical future while they’re at it.” Read more.

Rep. Denny McNamara announced he will not seek another term in the legislature, and he is supporting Tony Jurgens to take his place. Jurgens filed for the seat just minutes before the deadline on Tuesday, and Rep. McNamara announced his retirement on Wednesday morning. Read more about Jurgens and the district here.