Illinois Gov. Pritzker’s move leaves Chicago budget to cover $29 million – Crain’s Chicago Business

To pay its bills, the authority generally relies on revenue from the 2% tax on city hotel and motel rooms. But with COVID having driven patronage at inns way down, revenues have fallen well short of what’s needed for debt service.

The authority was able to handle that last year by refinancing debt and drawing down its reserves, said ISFA Executive Director Frank Bilecki in a phone interview. “This year, it was more difficult,” he continued, so the agency had to turn down a request from the city to lend it the money or otherwise defer payment.

Legally, however, the city still is responsible for the shortfall. Under the measure that established the ISFA, debt payments are backstopped by a lien on city sales tax revenues collected on its behalf by the state.

“By state statute, any shortfall must be made up by a reduction of the local government distributive fund (LGDF) distribution to the city,” said a spokeswoman for the Revenue Department. At the request of the city, the money will be deducted from the $60 million the city had expected to receive in LGDF money in June. 
City officials declined to comment. But state officials believe Lightfoot could tap leftover federal COVID relief funds or other sources, if need be, rather than expecting taxpayers statewide to foot the bill.

Sources also note that, only last week, Lightfoot told a City Club of Chicago luncheon that city receipts have been so peppy of late that the city is running a budget surplus, and that the General Assembly at Pritzker’s request enacted legislation making it easier to collect sales taxes on online vendors. That law contributed to a big increase in internet sales tax receipts, from $262 million in fiscal 2021 to $366 million in fiscal 2022. 


via “Illinois Politics” – Google News

April 28, 2022 at 07:26PM

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