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Dear Neighbor:
As you may know, last week the Governor gave
his annual budget address which outlines his
approach to the budget for the coming fiscal
year and serves as a jumping off point for
the legislature's task of creating a budget.
This budget is particularly daunting -
Illinois' projected deficit is approximately
$12 billion - due in large part to
non-payment into pension funds, skyrocketing
healthcare costs, loss of federal funding for
state programs, dramatic decreases in both
income and sales tax revenue and an
unreformed, unresponsive tax system.
In the past the legislature has attempted to
address the state's financial problems but to
no avail. We slashed $3.2 billion from the
budget last year and decreased the number of
full-time employees in the state by 14,000
over the last nine years (Illinois has the
smallest ratio of state employees to citizens
in the country). The problem is that these
singular approaches simply aren't enough and
the legislature has turned to borrowing money
to make up the difference. Moving forward
the three must haves for a sustainable budget
for Illinois are: pension reforms,
spending reforms, and the modernization of
our tax system.
Pensions are a particularly heavy burden on
the state. In 2009 the state had $62.4
billion in unfunded pension
liabilities.1 Although we have
been making our payments in recent years, we
have been borrowing money to do so. As such,
last year alone Illinois borrowed $3.5
billion to make its payments and another $4.1
billion is due in the next fiscal year. The
constitution prohibits us from changing
pension payments and agreements made in the
past. However, discussions about reforming
pensions affecting future hires include ideas
such as an increased retirement age for state
employees, creating a tiered pension benefit
system, attaching increases in benefits to
inflation rates and capping pensionable
income at $150,000.
Further spending cuts are going to be an
important component of a sound budget,
although the complications are fourfold.
Firstly, debt service payments are numerous,
non-negotiable and must be paid. Secondly,
due to federal matching funds, cutting one
dollar from the budget often results in a net
loss of two for the program. Additionally,
Illinois spending is already low (we have the
5th largest population but rank 45th in
spending).2 Lastly, demand for
services has, logically, increased
dramatically as the economy has worsened.
Human and social service programs and
providers have already been stretched to the
limit and we cannot neglect to pay money owed
to and cut funding for vital services - basic
human needs in many cases - for our own
neighbors; especially when not doing so has a
devastating multiplier effect on government
assistance demand in general. Spending cuts
will require a close analysis of state
programs so that we may trim those that are
the least effective and efficient without
losing federal match or cutting vital
services.
Finally, there is no doubt we need to
restructure the state's antiquated tax system
and increase revenue. There are a few things
to note about our tax system that has
hamstrung Illinois as compared to most other
states:
- No Progressive Income Tax -
Illinois is constitutionally prohibited from
using a graduated income tax. Therefore,
increases to the income tax have an equal
burden on all income classes rather than the
more popular graduated income tax system
where the higher income bracket an individual
is in the higher their tax burden.
- Low Income Tax - Illinois has the
lowest income tax of any state that has one
(only Alaska, Florida, Nevada, South Dakota,
Texas, Washington, and Wyoming don't have
income taxes.)3
- No Tax on Retirement Income - Many
states levy a tax on retirement income,
including all of the states that do not have
an income tax. Illinois does not.
- Shifting Economy - Since the early
'90s our tax base has been skewing to
services and away from manufacturing (42% of
our states Gross State Product is
service-related).4 The shift
itself is not as large of a problem (in terms
of revenue anyway) as the fact that we
haven't restructured our system to
accommodate the change. Illinois has always
had a relatively low and non-inclusive
service tax and we now rely on it for revenue
more than ever. Of the 164 taxable services,
Illinois only taxes 17 of them (mainly
industry taxes on utilities) while other
states tax many more: Delaware (142 services
taxed); Hawaii (160 services taxed); New
Mexico (156 services taxed); South Dakota
(146 services taxed).5
- Illinois is a "Donor State" - For
every dollar Illinoisans send to the federal
government by way of taxes, the state
receives only $0.75 in federal
spending.6 This number is so
unbalanced that we rank 47th nationally. Per
dollar of federal taxation, Illinois's return
of $0.75 per dollar isn't even close to what
our neighbors get in return for their dollar:
Wisconsin ($0.86)7, Iowa
($1.10)8, Missouri
($1.32)9, Kentucky
($1.51)10 and Indiana
($1.05).11
- Gas Tax - As of July of last year,
Illinois ranks sixth in the nation when it
comes to gas tax ($0.338 per
gallon).12 Although this in and
of itself isn't a disadvantage, the
consequences are real and have a negative
impact on manufacturing, investment and
everyday decision-making. For example,
anyone near an Illinois border that needs gas
can buy it (along with everything else they
spend money on at the gas station) nearby in
another state for less. Companies that rely
heavily on gas can either buy it elsewhere or
locate outside the state altogether even
though we have a desirable workforce in need
of jobs. Illinois' neighboring states all
have lower gas taxes: Indiana
($.0297)13; Wisconsin
($.329)14; Missouri
($.173)15; Iowa
($.22)16; Kentucky ($.225, but
fluctuates with price)17.
- Low Overall Tax Burden - The
overall tax burden in Illinois is low despite
our reputation for high state (and in some
cases local, i.e. Chicago) sales taxes.
Considering state and local taxes, Illinois
ranks 30th in the nation in overall tax
burden18. As such, our reputation
isn't aligned with reality and Illinois'
relatively low tax burden only fuels the
fiscal crisis.
Combine all this with the fact that the
single largest revenue source in the State of
Illinois is property tax (which declines when
the economy falters forcing cuts when
services are needed most), it is clear that
we need to modernize our tax system.
Therefore, I am advocating for a most serious
effort to come to terms with the realities of
our broken tax system and realign it with our
revenue goals and with sound tax policy.
Illinois needs a tax system that is in-line
with what the Center for
Tax and Budget Accountability calls the
"four elements of sound tax policy." They
include taxation that is 1) responsive to
growing economic sectors, 2) fair, 3) stable
through tough economic times and 4) has
minimal impact on taxpayer's decisions. Our
heavy reliance on sales tax and on our
prohibitively-burdensome property tax (mainly
administered locally and used to fund a
failing education system) doesn't fit the
bill and must end.
I will keep you updated on the budget and
other legislative initiatives throughout the
legislative session. In the mean time, feel
free to email or call if you have any
questions or need anything at all.
Very Truly Yours,
Sara Feigenholtz
State Representative, 12th District
| Shopping Spree to Benefit Lakeview Pantry |
|
On February 26 I participated in the Kane County
Farm Bureau's "Food Check-Out
Challenge Shopping Spree" to benefit a pantry
of my choice. I chose and paired up with
Lakeview Pantry
and spent five whirlwind
minutes grabbing as much food off the shelves
at Jewel as I could. Gary Garland, executive
director of Lakeview Pantry, assisted me in
choosing appropriate food items and together
we were able to walk away with almost $900 of
food donations for the pantry. Thanks to the
Kane County Farm Bureau for hosting the event
and for paying for the donations. I would
also like to thank Lakeview Pantry for their
great work supporting those in our community
with unmet nutritional needs. Please visit
their website's "10
Ways to Help" page and
consider volunteering or making a donation of
food, clothing, money or other items in this
time of need when donations are down and need
is up.
Or, if running is your thing, consider
joining the Chicago Marathon's Charity Runner
program and run for Lakeview Pantry. For
more information contact Ashley Cullins,
Development Coordinator for Lakeview Pantry
at (773) 525-1777 x17 or
ashley@lakeviewpantry.org
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| LakeView Village |
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LakeView
Village is a non-profit organization
that provides local seniors with at-home
services such as transportation, home
maintenance and repairs and social programs.
They are currently conducting a survey to
determine how their services can best support
the area's senior community. If you or a
family member live in zip code 60613
or 60657 and want or need to utilize LakeView
Village's resources, either now or in the
future, please
take a minute to complete their survey.
The Survey will be open until
April 23 and, upon completion of the survey,
you will be entered into a drawing to win one
of six $50 Lakeview East Chamber of Commerce
gift cards.
LakeView Village's boundaries are Diversey,
Irving Park, Ravenswood and the lake.
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| Community Events |
|
Fifth Third Bank's First Time Homebuyer
Seminar
Tuesday, March 16, 6:00pm, 3601 N. Broadway
Ave.
Fifth Third Bank is hosting a seminar for
first time homebuyers. Learn about the
benefits of owning, special loan and down
payment options, and what to expect from your
lender and realtor.
Fund Raiser for Weisman Park Renovation
Project
Friday, March 19, 6:00pm - 9pm, 3216 North
Sheffield.
Weisman Park Advisory Council is pleased to
announce on Friday, March 19, 2010 Trader
Todd's Bar and Restaurant is hosting a fund
raiser to support the renovation efforts for
Weisman Park. Come on out and shake off your
cabin fever while supporting the neighborhood
community project. The party begins at 6 pm
and goes to 9 pm.
Tickets are available at Trader Todd. You
may purchase them ahead of time or at the
door the day of the event. Tickets are
$30.00 per person and include a three hour
open bar and buffet. There will be a silent
auction and a Karaoke Stage for those who
choose to share their talent. Proceeds from
the event will go to the park renovation.
Virginia Carstarphern, co-owner of Trader
Todd's located at 3216 North Sheffield, says
"I'm happy to be working with the Weisman
Park Advisory Council and contribute to the
fund raising effort on this community project."
Weisman Park is located on the 900 block of
Oakdale at Mildred. The park serves more than
5000 residents in the area. Fund raising for
this $750,000 renovation began in spring
2008, to date approximately $315,000 has been
raised. Groundbreaking is planned for later
this year.
To make a donation, purchase a brick or to
discuss how you can host a benefit at your
establishment contact mariepoppy@comcast.net.
The Weisman Park Advisory Council
appreciates all the support from the
community and local business helping to make
this community project possible.
Buena
Park Neighbors - Buena Bunnies
Sunday, March 21, 3:00pm - 6:00pm, Nick's
Uptown, 4015 N. Sheridan Ave.
Join the Buena
Park Neighbors for their 9th
annual Buena Bunnies event. Bring an empty
basket, treats, and other Easter goodies to
be donated to St. Mary of the Lake Church.
One winning basket will be chosen to win the
"Finest Buena Bunnies Basket" Award.
Park
West Community Association's Egg
Hunt
Saturday, March 27, 12:00 p.m. - 2:00 p.m.,
Park West Playlot at Wrightwood and
Burling
The Park West Community Association's Annual
Egg Hunt is a great event for neighborhood
children to participate with others in an egg
hunt and visit with the Easter Bunney. The
event costs $5 per child (payable at the
event). Parents planning to attend with
their children should drop off a dozen
plastic eggs per child to Alderman Vi Daley's
ward office (735 W. Wrightwood) by Friday the
19th.
Lakeview
Chamber of Commerce
Eggstravaganza
Sunday, March 28, 1:00 pm - 3:00 pm,
Southport Ave. between Roscoe St. and Irving
Park Ave.
Lakeview SSA 27 is treating neighborhood
families to an afternoon of Balloon Artists,
Face Painters, and a Magician...as well as a
colored egg hunt, prizes, refreshments, and a
visit from the special big Bunny! There will
be activities at Sheil Park (3505 N.
Southport Ave) and an egg hunt along
Southport.
Race
to Wrigley 5k Run
Saturday, April 24, Wrigley Field
6:30am: race day registration
8:00am: start time
The 5th annual Race to Wrigley will begin and
end at Wrigley Field and proceed through the
streets of Lakeview. Runners can
pre-register and ambitious runners can sign
up for a chip-timed run. Proceeds from the
event will benefit Chicago Cubs Charities and
all personal fundraising proceeds will
benefit Children's Memorial Hospital. For
more information and to pre-register, visit
the Chicago
Special Events website.
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| Citations |
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1. Patterson, John. 2010. State auditors
report pension debt. Daily Herald, February
16.
2. Mancini, Chrissy. "Issue Brief on the
Illinois Property Tax." Center for Tax and
Budget Accountability.
http://www.ctbaonline.org/All%20Links%20to%20Research%20Areas%20and%20Reports/Budget,%20Tax%20and%20Revenue/property_tax_page.htm.
3. Gaines, Brian J. and James H. Kuklinski.
"Perceptions of the Tax Burden." University
of Illinois Institute of Government and
Public Affairs. Available from
http://igpa.uillinois.edu/opinion-monitor/taxes.
4. Illinois Association of Chamber of
Commerce Executives. 2009. Taxation of
Services in Illinois. Report presented at the
2009 Legislative Summit, Springfield,
Illinois, January 26, 2009.
5. Illinois Association of Chamber of
Commerce Executives. 2009. Taxation of
Services in Illinois. Report presented at the
2009 Legislative Summit, Springfield,
Illinois, and January 26, 2009.
6. The Tax Foundation. "The Facts on
Illinois' Tax Climate." The Tax Foundation.
Available from "http://www.taxfoundation.org/research/topic/26.html.
7. The Tax Foundation. "The Facts on
Wisconsin's Tax Climate." The Tax Foundation.
Available from ttp://www.taxfoundation.org/research/topic/67.html.
8. The Tax Foundation. "The Facts on Iowa's
Tax Climate." The Tax Foundation. Available
from http://www.taxfoundation.org/research/topic/28.html.
9. The Tax Foundation. "The Facts on
Missouri's Tax Climate." The Tax Foundation.
Available from http://www.taxfoundation.org/research/topic/39.html.
10. The Tax Foundation. "The Facts on
Kentucky's Tax Climate." The Tax Foundation.
Available from http://www.taxfoundation.org/research/topic/30.html.
11. The Tax Foundation. "The Facts on
Indiana's Tax Climate." The Tax Foundation.
Available from http://www.taxfoundation.org/research/topic/27.html.
12. The Tax Foundation. "The Facts on
Illinois' Tax Climate." The Tax Foundation.
Available from http://www.taxfoundation.org/research/topic/26.html.
13. The Tax Foundation. "The Facts on
Indiana's Tax Climate." The Tax Foundation.
Available from http://www.taxfoundation.org/research/topic/27.html.
14. The Tax Foundation. "The Facts on
Wisconsin's Tax Climate." The Tax Foundation.
Available from http://www.taxfoundation.org/research/topic/67.html.
15. The Tax Foundation. "The Facts on
Missouri's Tax Climate." The Tax Foundation.
Available from http://www.taxfoundation.org/research/topic/39.html.
16. The Tax Foundation. "The Facts on Iowa's
Tax Climate." The Tax Foundation. Available
from http://www.taxfoundation.org/research/topic/28.html.
17. The Tax Foundation. "The Facts on
Kentucky's Tax Climate." The Tax Foundation.
Available from a
href="http://www.taxfoundation.org/research/topic/30.html.
18. Illinois Policy Institute. "Budget Facts
vs. Budget Myths." Illinois Policy Institute.
Available from http://www.illinoispolicy.org/news/article.asp?ArticleSource=1113.
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