For the past decade, Springfield has been taking a substantial portion of revenue from Illinois municipalities, arguing that state government needs the money more than local taxpayers.
Much of the revenue that cities, villages and counties count on to provide basic services comes from the state income taxes that are collected by the state and then redistributed back to local governments on a per capita basis.
These funds can amount to up to 20 percent of a town’s operating budget, or millions of dollars each year that are used to pay for essential things like: public safety (police & fire); transportation and storm/wastewater infrastructure (roads, bridges and flood prevention); and community healthcare and mental health programs.
It’s the basic services that residents – regardless of where they live – pay for … and expect. This local revenue – which comes from the Local Government Distributive Fund (LGDF) – reduces the need to increase property taxes, which – in Illinois – are already among the highest in the nation.
Local governments have been receiving a portion of LGDF for more than 50 years, but in 2011, Springfield increased the state income tax and started taking a larger share of the local pie — dropping the agreed-upon 10 percent rate it gives back to just 6.06 percent.
This year, Governor J.B. Pritzker has proposed taking another $152 million from LGDF fund to fill the state budget gap, but as local mayors, we’re facing our own budget challenges. The COVID-19 crisis and economic shutdown have wreaked havoc on local finances across Illinois. Absorbing and overcoming additional losses in LGDF money would simply be a Herculean task.
via The Southern
May 28, 2021 at 06:32AM