Kadner: School, taxes and a little truth
By Phil Kadner firstname.lastname@example.org March 26, 2014 7:10PM
Illinois Gov. Pat Quinn delivers the State Budget Address to a joint session of the General Assembly in the House chambers at the Illinois State Capitol, Wednesday, March 26, 2014, in Springfield Ill. (AP Photo/Seth Perlman) ORG XMIT: ILSP107
Updated: April 28, 2014 10:23AM
“For too long, Illinois has underfunded its schools and overburdened its property taxpayers,” Gov. Pat Quinn said Wednesday.
Well, it’s hard to argue with a man who repeats a message that I’ve been sending to readers of this column for 20 years.
The property tax is the most unfair tax of all and not based on ability to pay, the governor said.
But Quinn never actually spoke the words that everyone was talking about following his state budget address.
The governor wants to make the 2010 state temporary income tax hike (which raised the rate from 3 percent to 5 percent) permanent.
In exchange, he promises $6 billion a year more in public education funding over the next five years, a $500 property tax refund for every homeowner, more money to early childhood education and more money for state colleges, among other things.
And, oh yes, he may even use some of the money to pay the $5 billion in bills the state has outstanding.
His Republican opponent for governor in November, Bruce Rauner, immediately released a statement that said, “We can balance the budget without more tax increases, if we create a growth economy, and restructure and reform our broken government.”
And if Rauner could create thousands of jobs, cut waste and produce billions in new tax revenue within weeks of the next election, he ought to audition for a part as Moses in the remake of “The Ten Commandments.”
This state is in terrible financial shape because of incompetence, corruption and dishonesty by state leaders for decades.
So if you’re saying “I don’t trust those clowns,” I can’t blame you.
But for the first time in Illinois history a governor of this state spoke the truth to the public about property taxes and education funding.
“In Illinois, more is collected in property taxes every year than in the state income tax and state sales tax combined. In fact, Illinois has one of the highest property tax burden on homeowners in the nation — more than 20 percent above the national average.
“The property tax is not based on ability to pay. The property tax is a complicated, unfair tax, hitting middle class families the hardest.”
The reason property taxes are so high in Illinois is that the state Legislature realized long ago that the average person blames his local school district for property tax hikes and not state senators or state representatives.
That allowed the Legislature to spend billions of dollars over the years on things other than its chief responsibility, public education.
Illinois House Speaker Michael Madigan, the Democratic Party leader in Illinois, immediately announced his support for Quinn’s plan to make the income tax hike permanent.
But Madigan said in addition to property tax relief for homeowners, he would like to see some tax relief for businesses in the state.
Madigan said he sees this as an opportunity to correct all the inequities in the Illinois tax code, whatever that means.
As for that property tax relief, it isn’t going to be as much as the $500 per person would suggest.
People who file income tax forms in Illinois already are entitled to a property tax credit, which on average is about $250 a year for homeowners.
People in more expensive homes who qualify for even more under the current tax credit structure actually could end up with an income tax increase via the swap of the $500 property tax refund for the credit.
Quinn in his speech and several state officials later in the day noted that former Gov. Jim Edgar favored an income tax increase for education if it included property tax relief.
That’s true. But Edgar was adamant that the property tax relief include businesses, and Quinn’s plan wouldn’t do that.
Nor would it really remedy decades of neglect and under financing of the public education system in Illinois.
But it is better than the cuts that would have to occur in school funding if the income tax hike expires.
That would not only result in the layoffs of thousands of teachers but even higher property tax bills in many school districts.
Illinois ranks dead last in the nation in the share of the cost of public education it picks up.
Many analysts contend that the quality of public education is a leading indicator of how a state will perform financially in the future and a key factor in creating new jobs and attracting new businesses.
Whether that’s true or not, the fact is that state government hasn’t done its fair share to support public education, and that has resulted in soaring property tax bills that have forced people to sell their homes.
It’s a rotten system. Everyone in Springfield has known that for decades.
And it didn’t change because our elected leaders didn’t want it to change.
That brings us back to the question of can they be trusted now.
The alternative is to believe people who say they can cut spending, including the state’s school budget, and improve education at the same time.
Quinn claims he already has reduced state spending by $5.7 billion over the last five years.
His office contends the number of state employees has been reduced from 60,961 to 49,831 over the past 10 years.
Quinn didn’t say it, but this state also is last or near last in its support for mental health care programs and programs that help people with developmental disabilities.
In other words, more cuts in social service programs would further harm those least able to take care of themselves.
Legislators shouldn’t have called the income tax hike temporary in the first place because they knew this day would come; that Illinois needed the additional revenue.
Or, over the past four years, they could have called for a constitutional referendum on a graduated income tax system in Illinois.
That’s a system where the people making the most money pay higher taxes and the people earning less pay less.
By the way, those property tax refund checks may arrive in the mail just in time for the November election.