 Cities in Illinois have a deal with state government to get a cut of
the state's income tax. In exchange, they don't, and can't, collect
an income tax of their own.The state opted to keep all of the
income from a recently approved 67 percent personal income tax
increase and to base the cities' cut on the old rates. Cities say
they need 10 percent from the total income tax, instead of the 6
percent they're getting under the new law.
Municipalities will get about $1 billion in state tax money this
year, and the Illinois Municipal League projects that by 2015,
cities will be pulling down almost $8.1 million more.
But the municipal league, which lobbies on behalf of cities,
villages and townships, also said its members lose out on a total of
$2.7 billion in potential revenue because they're not getting a 10
percent cut of the income tax money.
"The fact is many municipalities cannot increase their revenues
like the state can. We cannot impose our own income tax. Many
communities are under property tax extension limitations -- meaning
they have tax caps -- and many communities do not meet the home rule
requirement to be able to impose additional sales tax," said Brad
Cole, mayor of Carbondale.
Home rule gives local communities more power over things such as
tax increases and issuing bonds.
Cole and community leaders said they've already laid off workers,
not filled vacant spots and even cut some services to balance
budgets. It is an approach the state should take too, said George
Galrapp, mayor of Freeport.
"All these mayors here of municipalities and village presidents
and their employees have suffered the pain during this economic
downturn," Galrapp said. "We need our state legislators to come into
a realistic world and do the same thing and not continue to pass on
their deficits."
[to top of second column] |
When laying out the tax increase, Sen. President John Cullerton,
D-Chicago, pointed out that while municipalities wouldn't be getting
any of the new money, the state also wasn't diverting anything they
receive.
Sen. Mike Jacobs, D-Moline, said the state needs the money.
"Well, the state clearly needs it, from my perspective -- I am in
state government. I understand that the cities are not getting their
share. I understand them being upset," Jacobs said. "I would have
preferred to see it go to the cities. I think that has always been
the system in Illinois, and it is one that we should live within.
But in this particular case, you don't always get your way."
Some of Jacobs's Republican colleagues don't see it that way.
Rep. Sidney Mathias, R-Buffalo Grove, has introduced a measure to
get municipalities what they want. Mathias asked why the state's
budgetary problems should hurt municipalities too.
"We did make this agreement many years ago, and I think we should
stick to it," he said.
Mathias' plan is stalled, however.
[Illinois
Statehouse News; By ANDREW THOMASON]
 |
