From State Senator Craig Wilcox:
Senate Week in Review: March 4-8, 2019
Springfield, IL – Before I comment on what’s happening at the Capitol, I want to ask for prayers for the family of McHenry County Sheriff’s Deputy Jacob Keltner who gave his life March 7 protecting all of us. Deputy Keltner, of Crystal Lake, was killed in the line of duty while attempting to serve a warrant on a suspect who was staying at a Rockford hotel. Keltner was working with the U.S. Marshalls Great Lakes Regional Fugitive Task Force to apprehend Floyd Brown of Springfield, when he was shot.
Jacob’s death is a great loss for all of us, and especially for his family and friends, and the citizens who live in McHenry County where he served so ably for 13 years. Please keep Deputy Keltner and his family in your prayers as they go through this very difficult time. Jacob left behind a wife and two young children.
At the Capitol
Legislators were back at the Capitol for a busy Tuesday, Wednesday, and Thursday session week. The big news of the week was the $3.4 billion state income tax hike announced by the Governor March 7. In related news, there are two economic-related reports to pass along, and legislators begin assessing Illinois infrastructure needs.
Another Democrat Income Tax Hike
For the third time in eight years, the Democrat party is pushing for a state income tax hike. This time, the effort is spearheaded by Governor J.B. Pritzker who announced the $3.4 billion tax hike March 7.
There are a lot of questions about the impact of the Governor’s proposal. I can tell you that my Senate Republican colleagues and I are opposed to the tax increase, and disappointed there are no guaranteed protections for middle class families.
- Will the hard-earned paychecks of every middle class family be protected?
- What will be the impact on Illinois employers, especially small business which represent 99.6% of all Illinois businesses?(https://www.sba.gov/sites/default/files/advocacy/2018-Small-Business-Profiles-IL.pdf)
- Job creators already face increased costs from a higher minimum wage; how will higher taxes on that additional burden impact their ability to hire and expand their businesses?
The majority party passed major state income tax increases in 2011 and 2017, resulting in more than $30 billion taken out of the pockets of both working families and businesses. While the Governor wants yet another tax increase, his recent budget proposal continues the overspending and lack of reforms, which helped create Illinois’ current fiscal crisis.
DO YOU TRUST SPRINGFIELD WITH MORE TAX MONEY?
In related news, there are two new assessments of Illinois’ economy:
The Property Tax Burden
Illinois continues to rank high for property tax burden, a familiar concern for homeowners and employers throughout the 32nd Senate District. Wallet Hub, the online personal financial website, recently released its 50-state rankings on property taxes. Using U.S. Census Bureau data to determine real-estate property tax rates in each state and then dividing the “median real-estate tax payment” by the “median home price,” Wallet Hub ranks Illinois as having the second-highest property taxes, trailing only New Jersey.
Putting the second-place ranking in perspective, the median home value in the U.S. is $193,500, according to 2017 figures, which represents the most recent available data. According to Wallet Hub, while the average American household pays $2,279 on property taxes for their homes each year, Illinois homeowners pay a whopping $4,476 for that same priced home!
The Overall Economy?
For years, Senate Republicans argued for lower taxes, limited government and fewer regulations on employers in order to grow the state economy. Instead, since 2003, the Democrat majority has grown government through overspending, passed two major state income taxes and now want a third tax hike, plus added regulations raising the cost of hiring and investing for employers. At the same time, Illinois continues to struggle to recover from the 2008/2009 Great Recession while other – more prudent states – are having just the opposite experience.
A recent Wall Street Journal article notes that since the end of the so-called Great Recession of 2008/2009, many states (but not Illinois) are enjoying revenue surpluses and are considering increase spending or cutting taxes. The article states, “Arkansas this month lowered its top personal income-tax rate by 1 percentage point to 5.9% and South Carolina has proposed an income tax rebate to all residents who file returns. In Florida, the governor has proposed lowering property and sales taxes. The givebacks come even as all three states proposed increased spending on education and other priorities.”
The article also indicates that other states saved nearly $33 billion in their ‘rainy-day’ funds in case of a future economic downturn. What about Illinois? As of the date of this column, the Illinois Comptroller’s reports we have less than $55,000 in our version of the rainy-day fund, which is called the Budget Stabilization Fund.
The WSJ article pointed out that Illinois is one of the states not “out of the woods” because of our fiscal problems, which increase burdens on taxpayers and local communities: “Illinois and Connecticut face big deficits and are proposing tough measures, such as raising taxes and requiring towns to pay a portion of pension costs.”
Running For the Exits
A real-life measure of the impact of Illinois economic challenges might just be Illinois’ inbound and outbound movement of its citizens. Harder-to-come-by opportunity appears to be driving people out of Illinois, according to one popular assessment:
United Van Lines’ Annual National Movers Study looks at inbound and outbound moves to and from each of the 50 states. For 2018, the company ranked Illinois as having the second-highest outbound moves of any state. The number one reason (45.5%) given for leaving Illinois was Jobs. Almost half those who moved out of state (49.7%) were in the 18 to 54 age group, the prime working age.
Perhaps Illinois should be mimicking the states that are growing their economies.
One of the big issues related to the state’s economic health is addressing our deteriorating infrastructure of roads, bridges and crumbling public facilities and buildings.
Addressing Illinois’ Infrastructure Needs
The newly formed Senate Subcommittee on Capital met in Edwardsville during the week to hear testimony from colleges, universities, and local governments in the southern Illinois region about their capital and infrastructure needs.
Illinois hasn’t had a capital bill in 10 years, which worries state officials, transportation experts and higher education administrators, who say the state’s infrastructure is rapidly deteriorating, causing concern for economic prosperity and safety.
In the coming weeks, the Subcommittee on Capital will continue touring the state and hosting hearings in an effort to gain better insights into the state’s infrastructure problems. Edwardsville was just the second of six scheduled hearings. The first took place in Springfield on February 21.
Four other hearings have been scheduled, including one in our area:
• Monday, April 22, 1 p.m. – Gail Borden Public Library, 270 N. Grove Ave., Elgin
A key question is, how does Illinois address infrastructure when it’s dealing with a severe fiscal situation?
Finally, Senate activity, at the committee level, moved into high gear during the week. Twenty-four committee hearings were held. Senators considered hundreds of legislative proposals introduced since mid-January. Dozens of additional committee hearings are planned throughout the month of March.