By Scott Reeder -
For a few minutes earlier this month, I received a dollop of hope when word trickled out of the statehouse that the Republican and Democrat leaders in the state senate had been negotiating a compromise behind the backs of Gov. Bruce Rauner and House Speaker Michael Madigan.
Maybe just maybe, the two could reach an agreement that would not only be palatable to head honchos Madigan and Rauner, but also be good for the people of Illinois.
And then the details of the plan leaked out.
It’s a stinker.
It is no compromise. It’s an acquiesce that would leave fiscal conservatives groveling at the feet of the big spenders who got us in this mess in the first place.
I’m sorry, but there is little in this agreement worthy of praise.
It would permanently raise our income tax to 4.95 percent of our income.
Oh, gee, 4.95 percent?
It reminds me of a car salesman pricing a used Pontiac at $2,999.95 so that people will think they aren’t really spending $3,000.
Give me a break.
Make no mistake, this plan calls for the state of Illinois taking a nickel of every dollar you earn. That’s about a 33 percent tax hike.
I might feel better about the taxes if there was some assurance that new revenue would be used to pay down the state’s debt. But I’m not seeing much in the way of guarantees.
Back when Pat Quinn was governor, the legislature temporarily jacked up the income tax to 5 percent and the General Assembly spent the next four years increasing spending and did little to pay down bills. In fact, unpaid bills were almost at the same level when the income tax dropped as when it began four years earlier.
And our state’s pension debt rocketed upward. The General Assembly failed to pass a constitutional pension reform plan.
In fact, it seems the legislature is incapable of making tough calls when it comes to cutting spending.
There are some half measures included in the “compromise.” For example, in exchange for permanently hiking our income taxes by one-third, the fiscal conservatives were thrown a bone: property taxes won’t go up for two years.
That’s hardly much of a trade.
I’m told the plan also calls for a special tax on soda pop.
But according to the Associated Press, the plan calls for the state taking on some of the Chicago Public Schools pension obligations to the tune of more than $200 million a year.
The AP also reports that a new pension reform plan will be pushed through that would save Illinois taxpayers $1 billion a year.
I’m skeptical. Very skeptical of this.
It looks to me like a spoonful of sugar to make the tax hike easier to swallow.
I’ve seen past pension plans get shot down by the Illinois Supreme Court.
And I’m not holding my breath that this will pass constitutional muster.
Instead of banking on the pension reforms being constitutional, pass them now and wait for the Illinois Supreme Court to rule. If the reforms are upheld as constitutional, then we can look at other elements of the package to consider.
In other words, don’t even consider raising my taxes until you’re certain of cost savings.
Other aspects of the plan such as expanding gambling may help the state gain more revenue. But the state will never get its financial house in order until it brings its spending under control.
And this plan does little in that regard.
The people of Illinois deserve better.
Scott Reeder is a veteran statehouse journalist. He works as a freelance reporter in the Springfield area and can be reached at [email protected].
Madigan and his henchmen are bound and determined to kill this state. He’s doing one helluva job.
Spot on Scott Reeder. I hope I am incorrect here, but I have an image of Ragodno sitting at the table saying it can’t be 5 percent because that would be hard to sell to her constituents. So the ask for an immaterial adjustment lower to be positioned as a concession No wonder Madigan softened his tone.
The kids I know probably drink enough soda to put the state & the pensions in real good shape!
If IL is going to institute a “soda” tax of it’s own of a penny per ounce, then all the cities, towns, villages and counties that currently have a tax must be required to rescind their taxes.
If not the tax on a 2 litre bottle of pop would be around $1.45 per bottle bringing the cost from $1.99 plus sales tax and “soda” tax to $3.45 a bottle. And what is now $2.49 per glass in a restaurant will probably to go $5.00. It will be cheaper to drink beer.
They will be effectively putting the soft drink industry out of business not to mention bottled juices and “flavored” water. So where does this “extra” revenue come from then?
Scott Reeder is absolutely right, this is no “compromise” … it is a Democratic beat-down of Republicans as there is not a whiff of meaningful spending cuts; just new taxes and spending.
No Republican can vote for this nonsensical “deal.”
Illinois Republicans will be the perpetual minority party if they “work with” Democrats on this one. No republican should ever consider a Democrat plan with a single tax increase, much less one with multiple tax increases. A “soda tax”?
I agree with Kerwin. All Republicans, who vote for that bill, should lose their next primaries.
It would be nice if we could just kick illegal aliens off of AllKids Medicaid. That would save a cool billion in the first year alone. They can find medical services in Latin America.
It soon will as profitable to smuggles soft drinks into this state tax-free as it now is to smuggle drugs, cigarettes and guns.
Wait ’till the gangs get in gear on this!
I agree with The Observer. I retired from the navy, so I can shop at the Great Lakes exchange, where they don’t charge any taxes. If this bill passes, I’ll try to buy drinks and sell them. I can make a profit, and my customers would pay less than they would pay at an Illinois store.
Go to the border, that short section just north of DuPage County, just east of Elgin, where Kane and Cook Counties meet.
Notice the signs on the Kane County side of the street: “NO COOK COUNTY SALES TAXES HERE!”
I think that says it all.