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 It’s election season in Illinois, and politicians
are running on the promise of property tax relief as usual, including every
major candidate for governor.
Illinois’ property taxes are already the second-highest in the nation and a
major reason taxpayers are fleeing to lower-tax states. That problem could be
made worse on Nov. 8 when voters will be asked to decide the fate of Amendment
1, a tax hike disguised as a “workers rights amendment.”
The change would prevent commonsense reforms to reduce homeowners’ tax burdens
while giving government union leaders virtually limitless new ways to demand
higher costs from taxpayers. If it passes, Illinois’ trend of large annual
property tax increases will likely grow faster than ever. Gov. J.B. Pritzker has
failed to deliver on property tax relief during his term – the average family
paid $1,913 more during his administration.
Amendment 1 would guarantee that family pays at least $2,149 in higher property
tax bills over the next four years, no matter which politicians win this
November or how well they try to follow through on their promises.
This is a conservative estimate, assuming the rapid growth of Illinois’ property
tax burden holds steady. It’s likely property taxes would grow at an even faster
rate, because Amendment 1 would give Illinois government unions unprecedented
bargaining powers that don’t exist in any other state. Exactly how much faster
is an open question.
Homeowners in Illinois are not destined to see their property taxes rise faster
and faster each year. Legislative proposals from Illinois Policy would
streamline the cost of local government by consolidating overlapping units of
government, cutting back on administrative waste in schools, and reforming
pensions to ease budget pressure for cities and towns. Amendment 1 would
effectively ban these bipartisan reforms to slow the growth of property taxes.
Already, the $75 billion in pension debt held by local governments is the main
driver of Illinois’ rising property tax burden. But Amendment 1 would give
government unions more extreme powers to make demands on taxpayers than have
existed in any state in U.S. history, meaning property taxes could be
significantly higher than $6,444 for the average family by 2026.
Amendment 1 would grant government unions unprecedented bargaining powers as a
“fundamental right,” including the power to override voters and state lawmakers.
Proponents are selling it as a constitutional ban on passing right-to-work laws
– laws that protect employees’ rights to keep their jobs without having to pay
fees to a union. Illinois is not among the 28 states that currently have
right-to-work laws, so that aspect has little meaning.
The amendment does include three other provisions that together would severely
weaken taxpayers’ voices in state government and make it easier for government
union bosses to make unaffordable demands in collective bargaining contracts.
First, virtually anyone would have a fundamental right to collective bargaining
if they could be considered an employee in any context, including even
prisoners. Second, bargaining would be expanded beyond just wages, hours and
working conditions to include broad new subjects covering public policy
decisions or how to run a businesses. Third, the amendment prevents lawmakers
from ever limiting or scaling back on these rights in any way.
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Even without these provisions, powerful government unions helped public sector
wages grow 60% faster than the private sector in Illinois from 1998 to 2019.
Peer-reviewed research shows stronger government worker unions cause the cost of
government to increase, with powerful unions putting even more upward pressure
on benefits than on wages. Government worker retirement benefits, which flow
mostly to government union workers, have left Illinois local governments with
$75 billion in pension debt and are already the primary cause of rising property
taxes. Government unions helped Illinois politicians build the state and local
pension crisis by supporting both unaffordable benefits as well as irresponsible
funding games that pushed costs into the future.
Nationwide data from 2010 to 2019 show a significant statistical association
between the percentage of government workers who are members of a government
worker union and each state’s average effective property tax rate.
The correlation coefficient is 0.53 with outliers Hawaii and Alaska excluded,
and still relatively strong at 0.45 with those states outside the mainland
included.
When union power increases, homeowners’ tax bills tend to go up as well.
It also could complicate efforts to fix Illinois’ existing pension crisis, which
itself requires a constitutional amendment to undo special privileges granted to
government pensions in the 1970 Illinois Constitution. Today, members of state
pension systems typically receive more than $2 million in lifetime retirement
benefits and cover just 5% of the cost through employee contributions.
Reforms that preserve retirement benefits earned to date but adjust them to
reasonable and affordable levels going forward could fix the pension system and
protect taxpayers, but not if unions are able to insert these benefits into
collective bargaining agreements. State law already says union contracts trump
state law when there’s a conflict, so Amendment 1 potentially provides an avenue
to making the pension crisis unfixable.
Government unions are already such a powerful force in Illinois politics that it
might be hard to see how their influence over taxpayers’ wallets could increase
further. But it can get worse.
In recent years the Chicago Teachers Union has refused to teach students unless
the union’s demands were met, including demands over matters of policy that are
supposed to be decided by voters’ elected representatives. Amendment 1 would
make it easier for unions to take control of these decisions, bypassing
legislative bodies, as well as emboldening their existing push for unaffordable
wages and benefits.
If Illinoisans are to have any hope of property tax relief, Amendment 1 must be
rejected. If it passes, property tax pain in Illinois will likely grow even
further beyond acceptable levels.
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