Governmental law covers interactions with various government entities, from borrowing money to getting work to requesting information. It is based on a combination of federal and Illinois law.
Government contracts. An enormous amount of the work done by the state and federal governments is done by private businesses. In fact, the federal government alone awards contracts each year to private businesses that are worth an estimated $200 billion.
The federal government does its contracting through contracting officers, who are authorized agents. Most of the process is governed by two laws, the Federal Acquisition Streamlining Act of 1994 (FASA) and the Federal Acquisition Reform Act of 1996, both of which were designed to simplify and streamline what had become a cumbersome process. FASA developed a simplified process for all contracts between $2,500 and $100,000, which includes being able to conduct a paperless process online.
The Federal Acquisition Regulation (FAR) is a book issued by the federal government that contains all the rules and the forms necessary for government contracting. Anyone wanting to contract with the federal government needs to be familiar with FAR. In addition to FAR, other government agencies may issue books that supplement FAR and apply only to contracting with that agency.
State contracts. Illinois has rules that apply especially to state contracts. First, it has criminal punishment for contract-related activities, such as kickbacks, bid rigging, and interfering with a contract submission. Second, it has the State Prompt Payment Act, which requires the state to pay contract invoices within 60 days. Third, it has laws that apply other laws to state contractors, such as ones prohibiting employment discrimination and requiring that prevailing wages be paid to contract employees.
Government financing. In addition to contracts, businesses can, of course, obtain financing from the government. Generally, those business that can obtain financing from private sources, do so. The ones seeking government financing are often those who have difficulty obtaining private finances, usually because they're just starting out and they don't have a proven track record of success.
At the federal level, the most common source of financing is a loan from the Small Business Administration. Because the SBA's eligibility requirements are fairly broad, about 99% of U.S. businesses are actually eligible for SBA loans.
One of the most popular loans is through the SBA's Low Documentation Program. They're popular because the loan approval rates are high, the process is relatively straightforward, and the terms are generous. Low Doc loans must be for no more than $150,000, and, in order to qualify, the business must not have made more than $5 million over the past three years and must not have more than 100 employees.
Another type of loan available through the SBA is called a microloan. Microloans of up to $35,000 are available for the purchase of certain business essentials, such as inventory, equipment, and furniture. The loans are actually issued by nonprofit organizations, typically local economic development organizations, that have been approved by the SBA.
In an effort to transfer more lending responsibility to private entities, the SBA has created two programs, called the Certified Lenders Program and the Preferred Lenders Program. These programs grant certain lending rights to lenders that have worked over the years with the SBA.
For those interested in larger loans, SBA loans of up to $2 million are also available. Called 7(a) loans after the section of the law that created them, these loans are much more like traditional loans than some of the smaller loans because they involve far more paperwork and have higher rejection rates.
At the state level, the Illinois Department of Commerce and Community Affairs directs public financing. Quite a few different types of loans are available from the state. Among them are the Small Business Development Loan Program, Enterprise Zone Program, and the Illinois Expert Finance Partnership.
At the local level, some cities and communities have business service centers that offer borrowing opportunities in addition to those offered at the federal and state levels.
Management assistance. Management assistance is a third resource available from the federal government. The SBA sponsors an organization called the Service Corps of Retired Executives (SCORE), which is a collection of retired business executive who dispense advice to business owners. SCORE provides counseling, business workshops, and training. Various other government organizations provide advice, such as the General Services Administration, which provides guidance to businesses wanting to sell their products to the federal government.
Lobbying. The next type of government contact is efforts to influence the legislative process. Federal laws require that all lobbyists register with the federal government, including with both the Senate and the House of Representatives. They must identify their clients, their major contributors, and the money they spend.
Lobbyists at the state level must register with the Illinois Secretary of State. They too have to disclose information about themselves, such as whom they represent and what their expenditures are.
Municipal law. Cities, of course, enact laws on matters specific to them. Common examples include land use and planning rules, such as zoning ordinances; environmental rules; and local licensing and permit rules. Municipalities have courts and judges that rule on matters specific to the city. Although municipal law is often thought of as mundane, important issues with constitutional ramifications are sometimes addressed at the city level. One example is school vouchers, where municipalities have attempted to develop programs to allow certain parents of public school students to receive public money to attend private schools. Another example is local anti-loitering rules targeted at gang members.
Administrative law. Administrative laws are rules for how government agencies (both federal and state) operate. Congress or the state legislature creates agencies to carry out various functions. The agencies issue rules, and they have a quasi-legal system that is separate and distinct from the courts. The administrative courts are presided over by administrative judges, who hold hearings and issue decisions. The procedure and rules are less formal than they are in the criminal and civil courts. Administrative decisions can generally be appealed to the courts.
Anyone who is expected to appear before an administrative judge should consult an attorney experienced in administrative matters.