Rauner proposes to slash municipal share of state income tax revenue by half
…Suburban mayors and organizations representing them were outraged by [Gov. Bruce Rauner’s] proposal to cut their share of state income tax revenue in half.
Rauner defended that initiative by saying local governments have an enormous pot of excess tax revenue, totaling about $15 billion. By grabbing some of the revenue that would normally go to those governments, he said, they would lose less than 3 percent of their overall revenue while helping the state plug its massive budget hole.
Hey, everyone has to sacrifice to get Illinois back on track, and that 3 percent isn’t much to give up, he implied.
“It’s a gross exaggeration that there are huge revenue excesses that are sitting around,” said Ed Paesel, executive director of South Suburban Mayors and Managers Association, which represents more than 40 Southland communities.”I would really like to know where the governor came up with those numbers. He had to be including school districts because municipalities just don’t have those kinds of reserves, particularly the communities that we represent….” Read more here. Related stories can be found as follows: Southtown /Tribune‘s “Rauner budget plan has few winners, mostly losers;” Tribune’s “Evanston mayor: Rauner plan to cut tax revenue to cities would act as ‘tax increase‘;” Daily Herald’s “Rauner: Cut suburbs’ income tax revenue in half;” Daily Herald’s “Mayors prepare for potential Rauner budget hit;” Sun-Times’ “10 areas on Rauner’s chopping block:” and The Chronicle. Click here to view the Estimated Losses to Local Governments in FY 2016 Due to 50% Reduction in Revenue Sharing with Local Governments Through the Local Government Distributive Fund.