104th General Assembly Recap

June 16, 2026

Big Wins for Illinois’ Charitable Sector

 

Early in the morning on 6/1/26, the Illinois General Assembly concluded a chaotic 2026 spring legislative session. Since our last legislative recap, Forefront’s policy team achieved some major wins for the charitable sector in Illinois, with significant support from our partner organizations. Read below for more information: legislative wins for the charitable sector, the final FY27 state budget, unfinished business, and what’s ahead.

 

THREE BIG LEGISLATIVE WINS FOR THE CHARITABLE SECTOR

 

Community Partner Fair Contracting Act (HB4340 – SA5) – PASSED UNANIMOUSLY

Both predictability and timeliness in government contracting are vital. Late contracts inevitably lead to late payments, a convoluted Court of Claims process, and increased costs to the State and community partners. The State Comptroller reported total interest liabilities in FY25 of almost $21M; meanwhile, community partners often take out lines of credit to cover cash flow gaps even though the cost of borrowing is not reimbursable. In extreme cases, nonprofit leaders from their personal checking accounts, lay off staff, or go out of business. Knowing all of this, the Illinois Health and Human Services Coalition (Coalition), of which Forefront is a member, formed a Government Contracting Steering Committee and conducted research in 2023, which showed that:

  • The State issued late contracts more than 50% of the time
  • >20% of grant payments weren’t paid at all until 6th month of the fiscal year or later, and the average receivable is at least $350,000 and older than six months
  • Organizations led by Persons of Color held the largest share of receivables, followed by organizations led by LGBTQIA+ persons
  • >85% of claims in the Court of Claims resulted from invoices not being paid before the end of the lapse period; claims ranged from ~$1,000-$600,000 and the oldest claim was ~7 years old.

Forefront’s policy team with House Assistant Majority Leader Dagmara Avelar, Chief Sponsor of HB4340

As Chair of the HHS Coalition Steering Committee, Forefront has played a key role in the policy response to the 2023 research. Since early 2024, when the Coalition introduced a sweeping omnibus bill (HB5064/SB3457), dozens of meetings have been conducted with the Governor’s Office of Management and Budget, the Attorney General, the Secretary of State, the Treasurer’s Office, the Comptroller, and many state agencies (CMS, DOIT, IDHS, IDPH, DCEO, and others). In early 2025, HB817 was enacted, which represented the first update to GATA since its inception (fact sheet). Later in 2025, the steering committee filed HB2746 / SB1778, which picked up where the prior bills left off. Then finally, in 2026, the Steering Committee introduced three bills instead of one larger bill: 1) Government Accountability and Transparency Act (GATA  [HB4707 / SB2844]); 2) Prompt Payment Act (HB957 / SB2845), and 3) Court of Claims Act (HB4340 / SB2843). This strategy paid off; each bill received multiple hearings this spring. All three passed unanimously out of committee with amendments, and HB957 and HB4340 passed unanimously through the full House.

Sheryl Holman, CEO of Community Assistance Programs; Lauren Wright, Executive Director of Illinois Partners for Human Service; and Holly Ambuehl testify before the House Revenue & Finance Committee on 3/26/26.

Partners and service providers including Community Assistance Programs, Illinois Coalition Against Sexual Assault (ICASA), Illinois Collaboration on Youth, Illinois Partners for Human Service, New Moms, and Of Color, Inc., provided written and oral testimony about their challenges in multiple House Committee hearings in spring 2026. The bills were also supported by many atypical partners, including Illinois Municipal League, Illinois Health and Hospital Association, Illinois CPA Society, and even private sector companies like State Farm.

In May, the three bills were combined back into a single bill named the Community Partner Fair Contracting Act (CPFCA; HB4340-Senate Amendment 5). The package passed on 5/31/26 and now awaits the Governor’s signature. Forefront and our partners worked incredibly hard to achieve this victory, and the effort showcases what’s possible through long-term collaboration and shared leadership. Pending the Governor’s signature, the CPFCA will go into effect on 7/1/27. While this package won’t fix everything, we are hopeful it will make significant improvements over the status quo for those managing grants and contracts with the state.

Lauren Wright; Forefront’s Policy Team; Carrie Ward, CEO of Illinois Coalition Against Sexual Assault (ICASA) and Forefront Board member; and Sheryl Holman with Rep. Lindsey LaPointe, Co-Chief Sponsor of HB4340, after testifying before House State Government Administration Committee on 2/25/26. Not pictured: Key partner ICOY

Legacy Impact through Fair Transfers (LIFT [HB4206]) – PASSED UNANIMOUSLY

Unlike gifts left in wills or trusts, Illinois has no law requiring financial institutions to timely transfer non-probate gifts left to 501(c)(3) tax-exempt charitable beneficiaries (i.e., retirement accounts, securities, payable/transfer-on-death accounts). This bill sets a standard for faster, more efficient transfers, reducing administrative delays and helping charities (including houses of worship, community foundations, & direct service providers) put donated dollars to work sooner. Our steady partners at Jewish United Fund (JUF) led the legislative effort on this bill, which was also supported by a variety of other charities (see page 2 of the fact sheet linked below). Forefront helped secure supporting organizations for the fact sheet, get witness slips from partners, add cosponsors, and collect impact stories. The package passed on 5/14/26 and now awaits the Governor’s signature. Moving forward, Forefront will work with JUF and other stakeholders to ensure smooth implementation and conduct educational events for stakeholders about this opportunity.

Amy Zimmerman and Jared Hoffman of Jewish United Fund with Holly Ambuehl at the House Judiciary – Civil Committee Hearing for HB4206 on 3/29/26

 

Nonprofit Investment Pool (SB2968) – PASSED

Forefront’s policy team played a key role in supporting the enactment of SB2968, which enables the creation of a Nonprofit Investment Pool at the Illinois State Treasurer’s Office. Since 2024, we helped with strategy, provided testimony, secured witness slips from partners, suggested language for the bills, helped collect witness slips, and spoke with dozens of legislators about this proposal. The new program will allow 501c3 and 501c5 tax-exempt organizations to invest their own money in a program like Illinois Funds, providing access to larger economies of scale than the private banking industry can provide while keeping money safe and liquid. The Treasurer’s Office first introduced this bill in 2024 when a food pantry wanted to invest in the Illinois Funds program, but the Treasurer did not have the statutory authority to do so on behalf of tax-exempt non-governmental organizations. After vetting the proposal with a variety of stakeholders, Forefront agreed this is a practical way to help our stakeholders manage their funds more effectively (e.g., when stacking funding sources for a capital campaign, or any other reason a money-market-like account may be needed). The target market for the program is small-to-medium sized NPOs (i.e., $1-10M), but there are no restrictions on the size of eligible organizations.

Forefront’s policy team with Senator Adriane Johnson, Chief Sponsor of SB2968

 

In the summer of 2025, Governor Pritzker vetoed an earlier version of the bill, and Forefront spoke out against that veto. In contrast to the 2025 vetoed version, SB2968 was negotiated directly with the Governor and includes some of Forefront’s recommendations in response to the veto. SB2968 is expected to receive the Governor’s signature and become law. Once signed by the Governor, Forefront will partner with the Treasurer’s Office to support implementation and educate our community about how to leverage this investment opportunity.

 

FY27 STATE BUDGET SUMMARY

In 2024, Forefront’s biannual public policy survey found that supporting structural budget reform was the #1 priority among stakeholders for Forefront’s state policy work in the future. In response, Forefront’s senior director of policy and government affairs took on a leadership role as legislative co-chair of the Responsible Budget Coalition and participated in frequent meetings with legislators and other budget advocates to push for structural reform and advocate against cuts to important programs. Despite the chorus of people calling for major ballot initiatives and/or big-ticket solutions, the General Assembly passed a balanced FY27 budget on 6/1/26 without any major structural changes. The budget implementation plan (aka the “BIMP;” see HB2949 – Senate Amendment 2) contains statutory changes required to balance and implement the FY27 budget. Of note to those with state grants and contracts are provisions in Article 55 beginning on page 811, which are intended to decouple from federal actions. Leading up to the final days of session, a list of cuts in proposed by the Governor was circulated with the intent to support the need for additional revenue streams. In the end, the revenue package contained limited new sources of revenue, which are projected to generate an additional $795 million (see SB3019 House Floor Amendments 1 and 2).

Changes to revenue collections include, but are not limited to, the following:

Corporate Tax Changes

  • Lower cap on corporate net operating loss deductions for businesses (~$300M)
  • New tax in the form of a monthly fee on social media companies based on the number of users in Illinois (~$200M)
  • 2% tax on the value of cryptocurrency and other digital assets sold to Illinois residents by brokers
  • Expands the tobacco tax to remote tobacco retailers
  • New regulatory oversight plus a new 15% post-payout tax on companies that operate fantasy sports contests
  • Two corporate tax changes were enabled, but not counted as FY27 revenue due to expected litigation, including 1) a new per-wager license fee for prediction markets or exchanges and 2) a new 10% Targeted Advertising Services Tax, also known as a digital ad tax

Sales Tax Changes

  • Sales tax on gas will be transferred to the GRF once public transportation is fully funded, which opens up the use of those funds for any purpose ($150 million)
  • Temporary 1-year shift of sales tax revenue on candy, soft drinks, and grooming products to the state’s general fund instead of to capital projects ($79M)
  • $0.50 increased sales tax on purchase of tires
  • On the flip side, the final revenue plan also includes two temporary tax breaks: 1) a sales tax holiday for back-to-school shopping from August 7th to the 16th and 2) a freeze on the Motor Fuel Tax between July 1 and January 1, which was otherwise set to automatically increase by 1.3 cents per gallon

Total appropriated GRF spending for FY27 is $55.9 billion (see HB111 – Senate Amendment 3), which is about $700M higher than FY26 spending and assumes an anticipated year-end surplus of about $100 million. The budget plan includes about $65 million in reductions in government operations spending, but fully funds the K-12 evidenced-based funding formula as well as pensions, maintains the state’s health care program for older immigrants without documentation as well as welcoming centers, includes a small increases for universities and community colleges, and restores funding for a public school property tax relief grant program that was suspended in FY26. Key appropriations of interest to the charitable sector include the following:

  • Nonprofit Security Grant Program: Forefront is a member of the Safeguard Illinois Communities Coalition, which is spearheaded by Jewish United Fund’s policy team, and which leads advocacy related to this program. The NSGP was appropriated $5M in state funds and $43M in federal funds for FY27. A federally funded grant opportunity is expected in mid-June. To learn more, visit the IEMA-OHS website.
  • Human Services Loan Repayment Program (~$600,000): This represents a significant cut, to the disappointment and frustration of many valued Forefront partners.
  • Charitable Trust Stabilization Fund ($1M): Level funding for this grant program that supports small nonprofits in Illinois
  • Charity Bureau Fund ($4.5M): Level funding for this division of the Attorney General’s Office that regulates and supports charities in Illinois
  • Families Receiving Emergency Support for Hunger (FRESH): This new and temporary program is funded by the transfer of $70 million from the BRIDGE Fund. It is intended to last for 1 year and would provide up to 175,000 people who lost SNAP benefits with a one-time $400 payment
  • Direct Service Providers (DSPs): $0.60 wage increase

To learn more about the FY27 budget and what’s ahead, register for our joint budget webinar on July 14 and review the statements below collected from key partner organizations. Email [email protected] to add your analysis to the list below.

UNFINISHED BUSINESS

Small 501c3 Lobbyist Registration Fee Waiver (HB1169 / SB1196) – NOT ENACTED

On 5/30/26, the Senate version of this proposal was added to HB1832, a large elections and ethics omnibus bill (see Article 80). However, the package ultimately did not move before the general Assembly adjourned the spring session. Nonprofit organizations face many barriers to democratic participation and Forefront’s policy team gets more questions about lobbying and advocacy rules for nonprofits than any other issue. For years, improving the state’s Lobbyist Registration Act and educating stakeholders about how to comply with the Act has been a top priority. Since 2023, we’ve introduced this bill, which would waive the $300 lobbyist registration fee for small 501c3s and their exclusive lobbyist(s). This bill has continuously met strong resistance from the Secretary of State’s office for reasons that remain unclear, despite having a dedicated sponsor in House Assistant Majority Leader Maurice West (Chair of the House Ethics and Elections Committee), bipartisan and bicameral support, the backing of dozens of other statewide and advocacy organizations, and three subject matter hearings in the House since 2024. In the fall of 2025, Secretary of State staff offered to work with Forefront on administrative rulemaking in the spring of 2026. In response, Forefront sent a detailed list of recommended rules changes in February 2026. However, the SOS has not responded to those recommendations or hosted stakeholder meetings despite repeated requests since 2022. Forefront will continue pushing on this issue and we will continue to offer our regular advocacy trainings.

Road to Census 2030 Act – HB5724 / SB3459 – NOT ENACTED

In order to nudge state officials to begin planning for Census 2030, Forefront drafted and filed the Road to Census 2030 Act, which includes 3 appropriations totaling $2.6M in the state’s Fiscal Year 2027 budget support preparation for the 2030 Census. The recommended funding is intended to support the following planning activities:  1) for the Illinois Department of Human Services: relaunching the State Census Office and the Census Advisory Panel and planning for a statewide NOFO ($500,000); 2) for the Illinois Secretary of State’s office: beginning a public communication campaign and planning for the relaunch of the Complete Count Commission ($500,000); and 3) for the Illinois Department of Public Health: supporting the office of the State Demographer and coordinating with local governments to plan and participate in the Local Update of Census addresses(LUCA).

Children under age 5, Black and Latino communities, immigrants, and those living in group settings (dorms, nursing homes, jails, etc.) are most at risk for being undercounted in the Census. Undercounting then impacts representation in Congress and the distribution of federal funds, as well as other planning activities in economic development, transportation, and public health. Because of the major equity implications, Forefront proactively secured Chief Cosponsors from each chamber from the Black, Latino, and Asian Caucuses, as well as a handful of legislators that represented rural districts. While there was no movement on this bill this spring, we were indeed successful in getting the conversation going, and Forefront is planning to help support a subject matter hearing on these issues in Chicago in the fall of 2026.

Forefront’s Policy Team with Senator Graciela Guzman, Chief Sponsor of SB3459

Workforce Development Through Charitable Loan Repayment Trailer Bill (HB5491 / SB3802) – NOT ENACTED

This bill follows up on the Workforce Development through Charitable Loan Repayment Act, which Forefront passed in 2024 and which became law on 1/1/26. This trailer bill cleans up eligibility criteria by updating the definition of a Qualified Community Foundation (QCF) in the Act to match the definition in the Illinois Gives Tax Credit Act to ensure compliance with the national standards set forth by the Community Foundations National Standards for community foundations across the U.S. State funded and private sector solutions for student loan forgiveness and repayment are more important than ever as the federal government has rolled back supports in recent years, and as the Human Services Loan Repayment Program remains underfunded (see budget summary). This bill passed unanimously out of the House, but awaits Senate action for final approval. Forefront will continue monitoring this issue and partner with Alliance of Illinois Community Foundations and the Illinois Student Assistance Commission to enact this trailer bill when another opportunity to do so arises in veto or lame duck session.

WHAT’S NEXT

Only a handful of days during veto session (November/December) and lame duck session (January) remain in the 104th two-year session of the General Assembly. In January 2027, following Election Day on 11/3/26, a new legislature will be sworn in for the 105th General Assembly. As we move into the next legislative and budget cycle, Illinois will likely face major fiscal challenges. Forefront expects budget tensions to heighten as the state continues to face sweeping federal cuts and tax law changes, growing caseload demands, and mandatory formulaic and court-ordered spending increases. Forefront will continue to advocate for progressive structural solutions that protect vital services, and we urge our stakeholders to do the same. Other bills that Forefront was watching that did not move, but that may reappear in the future, include the following:

  • FEDERAL SCHOLARSHIP TAX CREDIT: In the coming months, Illinois will decide whether to participate in the new federal tax credit for private school scholarship granting organizations, which are often nonprofit/tax-exempt organizations. A variety of bills opting in or out of this program did not move this spring. Once federal regulations are published, Governor Pritzker is expected to decide. See related bills: Opt-In – HB4201 (McCombie [R]); Opt-In – SB3776 (Johnson-Koehler [D]); Prohibition – SB3966 (Guzman [D]).
  • REPORTING CHANGES TO NOT-FOR-PROFIT BOARDS (SB3256-Murphy): Requires three directors to sign changes in board composition in SOS filing; Forefront recommended an amendment (use %, not #)
  • VOTING RIGHTS ACT OF 2026 (SB3170-Guzman): Streamlines voting protections that are no longer guaranteed at the federal level to ensure voting rights for Black and Brown voters and eligible voters whose first language is not English; Forefront supported this bill
  • CHARITABLE TRUST GRANTS (HB2065– Meier/Balkema): Makes four eligibility changes to the Illinois Charitable Trust Stabilization Act for organizations receiving grants under the Act; Forefront submitted written testimony and recommended an amendment
  • USE OF RESIDENTIAL ADDRESS/PRIVACY (SB2816-Halpin): Allows for a registered entity under the General Not for Profit Corporation Act of 1986 to use a residential address as a principal office if there is not a physical location for the entity

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