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Posted by Barton Lorimor (@bartonlorimor)
* Ray Long is reporting the Speaker does not yet have the 60 votes needed to remove the sunset date from the income tax hike…
The speaker, talking to reporters the day he was easily elected to a fifth term as Illinois Democratic Party chairman, said voting to keep the personal income tax rate at 5 percent instead of letting it fall to 3.75 percent on Jan. 1 will be a “difficult roll call.”
“Every person in the legislature is going to be called upon to make a budgetary decision — either a reduction budget or an as-is budget or a slight-increase budget,” Madigan said. “And they’ll be called upon to vote for the money to support the budget that they want.”
Madigan also said he is trying to round up votes to increase the state’s minimum wage from $8.25 an hour to $10 an hour or more. “Once we get to 60 (votes needed to pass), we’ll be prepared to call the bill,” Madigan said.
posted by Rich Miller
Wednesday, Apr 23, 14 @ 8:10 am
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Fascinating chess game here.
Polling shows huge opposition to extending the tax hike but Madigan know he must have it to avoid a real fiscal cliff and to keep his constituencies happy.
Over a dozen of his members publicly stated, including in candidate questionnaires, that they opposed extending the tax hike.
One wrinkle this time is that there are several outside groups who are pushing back against Madigan’s plans. The ads and robocalls have an impact and could make a big difference.
Comment by Adam Smith Wednesday, Apr 23, 14 @ 8:31 am
A friend just mentioned he’s moving to Florida this year.
The $300k of state income tax when generates will only require 133 new jobs at $45k per year to replace the lost revenue. His county hasn’t had a new company come in for more than a decade
Comment by A'mous Wednesday, Apr 23, 14 @ 8:37 am
If you vote against #1 and vote for #2, better pack your bags. MJM had success doing a two-fer with SSM and Pension Reform. Not sure this lines up as well. It would be interesting to know precisely how short he is of 60.
Comment by A guy... Wednesday, Apr 23, 14 @ 8:41 am
@a’mous
Oh please, tell your friend to enjoy Florida where he’s paying for it in a lower salary and higher insurance fees. It’ll be a wash but he gets to think he’s a rebel standing up to “big government.” Congrats on being a self-righteous tool!
Comment by PMcP Wednesday, Apr 23, 14 @ 8:59 am
A’mous, is your friend Jimmy John? He’s been saying that for years.
A side note, I knew a bunch of folks who were going to leave the country if Bush was re-elected, then others who said they would if Obama was elected. Guess how many did? Yeah. None.
Comment by Jimbo Wednesday, Apr 23, 14 @ 9:00 am
All these people who oppose keeping the tax increase either (a) have a plan to reduce spending, or (b) are okay with using the state’s pension funds to pay the budget. Which is it?
Comment by Cheswick Wednesday, Apr 23, 14 @ 9:10 am
PMcP————You may want to also note the much lower real estate taxes and sales taxes in the state of Florida. That will solidfy your argument.
Comment by Wally Wednesday, Apr 23, 14 @ 9:19 am
My neighbor across the street just move to Atlanta, and the tipping point was taxes. He’s a financial consultant, and explained in detail how he’ll save tens of thousands annually in taxes.
Comment by Anon Wednesday, Apr 23, 14 @ 9:20 am
If we don’t keep the income tax increase, how will we better pay out outstanding bills? We need the extra revenue to improve our fiscal situation.
Polls show that we strongly support social services. How will we adequately fund social services, and what will we cut if unable to properly fund them?
Comment by Grandson of Man Wednesday, Apr 23, 14 @ 9:21 am
To answer to all of these fiscal problems is job creation and retention. That, and maybe some spending control(nah, that won’t happen)
The more taxes increase in this state(sales, real estate, income,et.al.) more and more baby boomers will leave for locales like Florida. Younger people will go to places like Texas.
Comment by Wally Wednesday, Apr 23, 14 @ 9:28 am
Grandson of Man: “If we don’t keep the income tax increase, how will we better pay out outstanding bills? We need the extra revenue to improve our fiscal situation.”
That is what was said in 2011 when they voted for the tax increase…that it would go to pensions and to paying off the bills owed. Since 2011, the State has received $26 billion in new income tax revenues…yet we still have $4 billion in unpaid bills (projected to go up to $8 billion) and a structural deficit. This is because Quinn and the General Assembly has very poorly managed the additional revenue by increasing spending (granted increased pension and Medicaid costs took most of it) instead of holding the line or decreasing state spending.
Comment by unclesam Wednesday, Apr 23, 14 @ 9:29 am
I’ve yet to see a scenario presented that anyone would publicly get behind, that allows the current rates to sunset, has no new taxes, and actually leads to fiscal health.
And that assumes most of the long term saves inherent in the pension bill, are maintained by the court.
So far, it looks like GOP leadership opposes both the “recommended (same tax rates)” and “non-recommended (old tax rates)” proposed budgets, or anything similar. And will propose nothing else that adds up correctly, if history is any guide.
I hope enough on both sides come to their senses soon.
Comment by Walker Wednesday, Apr 23, 14 @ 9:30 am
“the State has received $26 billion in new income tax revenues…yet we still have $4 billion in unpaid bills (projected to go up to $8 billion”
I’m sorry I don’t have the figures, but I heard or read that we will lose substantial revenue ($1.6 billion a year?) if we don’t keep the tax increase, plus we will have a much-higher backlog of bills. Not to give too much credence to the financial ratings agencies, but even they say we need the extra revenue to improve our fiscal situation.
What shall we cut?
Comment by Grandson of Man Wednesday, Apr 23, 14 @ 9:35 am
Cheswick–of course they’re ok with using pension funds to pay for things. Not hurting them, is it? You think people care about anyone but themselves?
Comment by Geronimo Wednesday, Apr 23, 14 @ 9:40 am
–My neighbor across the street just move to Atlanta, and the tipping point was taxes. He’s a financial consultant, and explained in detail how he’ll save tens of thousands annually in taxes.–
Wow, tens of thousands in annual taxes. Business in Illinois must be good.
“the State has received $26 billion in new income tax revenues…”
Can you break down how you arrive at that figure? Thanks.
–
Comment by wordslinger Wednesday, Apr 23, 14 @ 9:41 am
And he won’t if he keeps coming up with plans like his recent idea to cut corporate taxes by $1.5 billion while we extend individual income tax increases.
Comment by Formerly Known As... Wednesday, Apr 23, 14 @ 9:43 am
@wally
I’m from Florida, it’s not some magical place where you save money by going there. It just goes into somebody else’s pocket. You save money on taxes but the difference goes somewhere else.
If taxes are so miserable and a driving factor why doesn’t everyone in Europe live in Ireland? They have the ability to move there and practically everyone understands English. The whole tax bogeyman is just an excuse for people to be upset about, it’s a standard ‘grass is always greener’ argument.
Comment by PMcP Wednesday, Apr 23, 14 @ 9:44 am
Grandson…
You are correct in that the state will lose $1.6 billion this fiscal year and will not have $5 billion in future years if the tax increase expires.
I also personally agree that the State cannot withstand such a decrease in revenue; however, it is hard for me to support the extension of a tax increase when those in charge of the monies have not been good stewards of the purse.
How can one trust the same people — who are using the same argument — after seeing the evidence that proves the leaders failed to fulfill their stated promises of 2011?
Comment by unclesam Wednesday, Apr 23, 14 @ 9:46 am
It would be interesting to learn what percentage of Capitol Fax commentators who always favor higher taxes and fees are employed by the state government. Sometimes, the opinions here seem skewed in favor of a larger government with more spending.
Comment by Upon Further Review Wednesday, Apr 23, 14 @ 9:46 am
Upon further review @ 9:46
True that!!!!!
Comment by A'mous Wednesday, Apr 23, 14 @ 9:51 am
Word…
In COGFA’s FY14 budget summary it estimated the total revenue increase due to the higher tax rate (from 2011-2014) was $25.65 billion…I rounded up.
Comment by unclesam Wednesday, Apr 23, 14 @ 9:52 am
Thanks.
Comment by wordslinger Wednesday, Apr 23, 14 @ 9:56 am
PMcP———–Am I correct that real estate taxes are significantly lower, that sales taxes are significantly lower and we all know there is no state income tax?
I haven’t even mentioned the weather!
Comment by Wally Wednesday, Apr 23, 14 @ 9:56 am
I had a popular Conservative blogger friend who decided to retire to South Carolina, to get away from the such a “high-tax state.” He didn’t even know that Illinois doesn’t tax most retirement income. He had never heard that from his circle of friends.
Amazing the extent to which ideological rants skew perceptions of reality.
Comment by Walker Wednesday, Apr 23, 14 @ 10:01 am
@wally
It actually depends where you live. But what you don’t pay in taxes you pay in insurance because you get 5 Category-3+ hurricanes a year. The cities get destroyed fairly often and they’re more violent than Chicago. Also, the weather blows because it’s too hot to walk around for 7 months out of the year. Seriously you must vacation there in the winter only? Florida and Texas are typical ‘grass is always greener’ mentality from people who have no clue.
Comment by PMcP Wednesday, Apr 23, 14 @ 10:11 am
“It would be interesting to learn what percentage of Capitol Fax commentators who always favor higher taxes and fees are employed by the state government.”
It would be just as interesting to know how many conservative wealthy people favor tax cuts for themselves and couldn’t give a hoot about those who rely on social services. Where people stand is often also where they sit. Why should that surprise anyone?
I know a few CINO’s (Conservatives in Name Only) who were on Medicaid for a very long time. These are folks who rail against government spending, yet they’ve been on the so-called dole for years. They are also folks who refused to see that when Romney talked about the 47% being dependent on government, he was talking about them also. But they don’t see this. They have the attitude that they got theirs and to hell with everyone else.
How many conservatives and Republicans slam government spending on one hand and have their hands in the public till on the other? I’ve had conservative family members and others ask me how they can apply for social services. One person who I was told repeatedly is against Obamacare phoned me and asked how a relative can get ACA Medicaid, because the person was severely depressed and suicidal, and the person needed medical coverage.
Let’s be honest, at least, when it comes to fiscal responsibility, because plenty of conservatives and Republicans made bad financial decisions or were unfortunate and had to rely on bankruptcy to evade further fiscal catastrophe.
Comment by Grandson of Man Wednesday, Apr 23, 14 @ 10:12 am
Well.. at least there will be some relief for the teachers in Crystal Lake (McHenry County) with their new contract that provides 6% raises in their last three employment years…. (School district #47.)
I though the General Assembly passed a law to halt this contract enloading?
Comment by OVERSIGHT Wednesday, Apr 23, 14 @ 10:16 am
Grandson of Man———-I would suggest attending some of the charitable fundraisers and look around at those wealthy conservatives. They are the ones writing the huge checks for a wide variety of worthy causes.
Comment by Wally Wednesday, Apr 23, 14 @ 10:33 am
Oversight, the GA bill pegged 6% raises as the maximum. Some districts were giving up to 20% annual raises the last three years.
Comment by Toure's Latte Wednesday, Apr 23, 14 @ 10:36 am
PMcP———So the weather is worse in Florida than Central IL in the summer, when it is 90-95 degrees with high humidity. Got ya.
I will be sure to do a comparison this upcoming summer. Cause I sure compare in the fall, winter and spring months!!!!
Comment by Wally Wednesday, Apr 23, 14 @ 10:38 am
Yes the State probably needs to keep the tax increase. At the same time the state has not been good stewards of the money they have. It is a bitter pill to voters to talk of Donating 100 mil (as an example) to a library, typically privately funded, and the next talk about how much you need more money from the taxpayer.
Had the state Legislature and Gov. took actions to restrict spending at the same time they made the temporary hike this would be perceived better. Illinois is a low tax state but has operated as a high spending state and now the bill has come due, well now and when SB1 is tossed. Most voters perceive this as a betrayal and mismanagement which IMHO is why Madigan’s Mushrooms are balking.
Steps need to be taken, again IMHO, to balance spending and taxation. These Steps need to affect both sides of the ledger.
Comment by Mason born Wednesday, Apr 23, 14 @ 10:38 am
Anon - My neighbor across the street just move to Atlanta, and the tipping point was taxes. He’s a financial consultant, and explained in detail how he’ll save tens of thousands annually in taxes. -
In order to pay 10k or more in Illinois income tax, you need to make over $200,000 per year. Georgia taxes income that high (top 3% of earners in the US) at 6% which means your neighbor pays more in income taxes. Their sales tax is lower, at 4% but they have 5 special use taxes - education, local, transportation, etc. - that increase the sales tax base in almost every county. Not a lot saved there, unless your neighbor lives in Cook County.
Real estate taxes - this I can understand because if your neighbor makes more than $120,000(60% of income - taxes taken out) than 37% of the income (a standard for figuring out cost of mortgage payment with neighborhood assessment, etc.) is about $42,000 per year. Taxes on that kind of property would be large. If your neighbor is moving to avoid property taxes, then Georgia is the place for him.
If it’s income or sales tax, then the argument your neighbor makes doesn’t really make a lot of sense. This discussion is about the extension of the income tax - which in Georgia is higher than Illinois.
Comment by john Wednesday, Apr 23, 14 @ 10:41 am
Yeah, my sister and her husband retired from Michigan to Florida about the year Michigan started taxing retirement income. Despite the fact that for 30+ he owned a Michigan business that allowed him to attain some wealth, not paying state income tax was the main thing to them. So, I asked them, how does Florida pay for safety, education and health. They said, we don’t know and we don’t care as long as they don’t touch our money.
Comment by Cheswick Wednesday, Apr 23, 14 @ 10:47 am
–Can you break down how you arrive at that figure? Thanks.–
@Word - The usual goofy gibberish, but just more prominently at odds with reality.
Comment by David Ormsby Wednesday, Apr 23, 14 @ 10:56 am
Ya big bunch of dummies!
Comment by VanillaMan Wednesday, Apr 23, 14 @ 11:04 am
As always, VMan adding a lot with the insight and knowledge.
Must have had a bad recess. He’ll feel better after nap time.
Comment by wordslinger Wednesday, Apr 23, 14 @ 11:14 am
The exodus is real.
It’s compounded by the fact that technology allows work to be done from anywhere.
High end lawyer spends 1/2 his year working from his home office out west.
Owner of a $100 million Illinois retail chain operates it from his new home in Florida.
Another friend sold a Chicago based design and production company but not before moving to Fl. Move saved them millions on the transaction
Comment by A'mous Wednesday, Apr 23, 14 @ 11:23 am
–Owner of a $100 million Illinois retail chain operates it from his new home in Florida.–
What’s your point? Business is good in Illinois?
–Another friend sold a Chicago based design and production company but not before moving to Fl. Move saved them millions on the transaction–
Millions in what? Are you suggesting your “friend” completed what must have been a transaction worth tens of millions of dollars and took it as income? Seriously?
Yet somehow avoided Illinois income tax because he lived in Florida?
Comment by wordslinger Wednesday, Apr 23, 14 @ 11:34 am
Madigan political theatre to cover the Dems in an election year. Lots of hand wringing,soul searching, and finally excuses to to the constituents for voting for the tax. Illinois, it was a tough decision but we had no choice. We did it for the children. Yeah, that excuse always works. But hey we want to raise the minumum wage.
Comment by Anonymous Wednesday, Apr 23, 14 @ 11:40 am
== The exodus is real ==
Very much so, A’mous.
But you do not need to rely upon anecdotal stories in making your point here. Why not rely on facts?
U.S. Census data shows we are barely growing, one of the bottom 5 in America. As the LA Times summarized it on December 30 “Pennsylvania, New Mexico, Vermont and Illinois posted the slowest population growth, all at or near a tenth of 1 percentage point.”
Comment by Formerly Known As... Wednesday, Apr 23, 14 @ 11:52 am
Some commenters here seem to be under the delusion that you can earn income in Illinois, yet if you don’t live in Illinois, you don’t have to pay Illinois income taxes.
How’s that working for you folks in the Metro East?
Comment by wordslinger Wednesday, Apr 23, 14 @ 11:52 am
Or, look at the Crain’s article just yesterday
== Census: People are leaving all six Chicago-area counties
Each of the six counties in the Chicago area experienced a net loss in migration from 2010 to 2013, as modest gains in international migration failed to compensate for larger domestic departures. ==
Comment by Formerly Known As... Wednesday, Apr 23, 14 @ 11:54 am
I’ve lived in Florida and it isn’t the panacea that people think. The real estate taxes are high and you are nicked for every service you have. So please, unless you have actual experience don’t use that sorry reasoning.
Comment by SaxMan Wednesday, Apr 23, 14 @ 11:55 am
The roll call on a vote allowing the tax rate to drop will be Exhibit A in the plaintiff’s response to the assertion of a police powers defense in the pension litigation.
Comment by Anonymous Wednesday, Apr 23, 14 @ 11:55 am
There have been over a dozen mentions of Florida thus far, many in a negative light.
Illinois collected $38,715,320,000 in 2013 from property taxes, sales and gross receipts taxes, license taxes, income taxes and other taxes.
That is over $4 billion more than Florida.
Yet Florida somehow manages to take care of nearly 20 million people compared to our nearly 13 million, without sharing the crippling budget problems we have. They do so with no state income tax, a lower sales tax, and so on.
Why? What accounts for that difference?
Comment by Formerly Known As... Wednesday, Apr 23, 14 @ 12:10 pm
==Grandson of Man———-I would suggest attending some of the charitable fundraisers and look around at those wealthy conservatives. They are the ones writing the huge checks for a wide variety of worthy causes.==
Actually, middle class folks tend to donate a greater % of their income than wealthy folks.
Comment by Robert the Bruce Wednesday, Apr 23, 14 @ 12:11 pm
FKA -
Illinois collected $38,715,320,000 in 2013 from property taxes, sales and gross receipts taxes, license taxes, income taxes and other taxes.
It’s quibbling around the edges of your comment, but Illinois does not have a state property tax. And the local communities that do collect it themselves or through their counties.
Comment by john Wednesday, Apr 23, 14 @ 12:14 pm
In Florida, there is no state income tax, but the government raises significant revenue from fees and permits. You remodel your house, you pay for a permit and pay a fee to record it.
Comment by Upon Further Review Wednesday, Apr 23, 14 @ 12:22 pm
@ FKA I don’t have the numbers I front of me but I’m guessing the revenue made by tourists in Florida helps a lot with not needing an income tax. Disney, Universal, Miami, spring break destinations, etc. That’s something IL will never be able to compete with. I don’t think thousands of college kids want to spend a week in March along the beaches of Lake Michigan…
Comment by MyTwoCents Wednesday, Apr 23, 14 @ 12:34 pm
–Why? What accounts for that difference?–
Out-of-state tourism money. Out-of-state pension checks, Social Security checks from the federal government.
Florida has been booming since the 1950s, no doubt — growing from 2.7 million to 19.5 million.
But it has more to do with weather, air conditioning, the interstate highway system and the ability of new generations to retire than any state’s income tax.
Retirement, like adolescence, is a relatively new development in the Western World.
Comment by wordslinger Wednesday, Apr 23, 14 @ 12:36 pm
Grandson
“How many conservatives and Republicans slam government spending on one hand and have their hands in the public till on the other?”
I know of one— Bruce Rauner
Comment by AFSCME Steward Wednesday, Apr 23, 14 @ 12:46 pm
The whole concept of working stiffs fleeing a jurisdiction for income tax reasons is ridiculous, anyway.
You live where you can make a buck. If you have a good plumbing business in Illinois, you’ll stay here. If you move, someone will take your place. Everybody needs a plumber. Taxes are a cost of doing business.
The richest people in the country live in Manhattan and Beverly Hills. They’re the highest tax jurisdictions in the country.
Seriously, though, if you are competent in the trades — plumber, electrician, carpenter, painter, etc. — you should consider Florida, at least for the down times.
The state is notorious for shoddy work and for workers who don’t show up. There are not enough skilled in the trades for the population.
Every year after Christmas, my brothers go down and work the Ft. Meyers/Naples corridor on the Gulf Coast for Illinois snowbirds, painting, hanging paper, plus any other handyman stuff the folks want. I went with them a couple of times during break in college.
They’ve built a great seasonal business down there through word of mouth.
Comment by wordslinger Wednesday, Apr 23, 14 @ 1:03 pm
John - don’t worry about quibbling, I appreciate the response. That was included only because it is one of the categories the Census Bureau lists in totaling the numbers, and I didn’t want anyone to think I was manipulating the data by including only certain categories or leaving something out.
Comment by Formerly Known As... Wednesday, Apr 23, 14 @ 1:03 pm
Upon Further Review, you remodel your house in our Illinois county, you pay for a permit too.
Word, do your brothers upgrade condo’s and the such?
Saxman, I have been looking at condo’s in Lee County Florida. The real estate taxes are very low compared to Illinois.
Comment by Wally Wednesday, Apr 23, 14 @ 1:14 pm
Formerly known as,
Florida FMAP (medicaid match) is 59.72% Illinois’ is 50.75%. For every federal tax dollar paid in, FLA gets 97 cents back, Illinois gets 75 cents back (as of 2005)
Comment by 100 Miles West Wednesday, Apr 23, 14 @ 1:16 pm
Whenever we have these tax discussions, folks bring up states like Florida, Texas and Indiana, but they omit mentioning states like Vermont, Minnesota, Maryland and Hawaii–all states with lower unemployment rates than Illinois and higher income tax rates for top earners. Hmmm…
Comment by Grandson of Man Wednesday, Apr 23, 14 @ 1:23 pm
Wordslinger & MyTwoCents - for some reason, your “thank you” for replying looks to be auto-moderated, lol.
In brief, my gut tends to agree, but the numbers disagree with us. Even with the income from those retirees and tourists showing up in sales tax revenue, etc., FL still takes care of more people than IL with less state revenue. Unless they have another income source? Maybe Federal funding discrepancies could explain this?
Comment by Formerly Known As... Wednesday, Apr 23, 14 @ 1:25 pm
100 Miles West - now we’re cooking. That makes sense and helps account for some of this rather large and confounding discrepancy. Muchas gracis.
fwiw, the Census data released on April 8th is here http://www.census.gov/govs/statetax/
Comment by Formerly Known As... Wednesday, Apr 23, 14 @ 1:29 pm
100 Miles West great data…..easier to pay bills if you get more money. So FL and TX keep touting how they can do more and tax less due to the generosity of states like IL where our federal tax dollar gets transferred to these states.
Also I love the comments about moving to FL and paying less in taxes. I had family do that….they made a lower wage so proportionally the tax break was not really significant due to lower earnings. Now they are ready to retire and they will continue to see lower income due to reduced retirement benefits from Social Security as they earned less. Now they are mad because my Social Security checks will be more than theirs. Sometimes decisions have long term consequences
Comment by illinifan Wednesday, Apr 23, 14 @ 2:05 pm
A’mous, I’m kind of glad your friend is leaving. Anyone making more than $6 million a year who objects to paying $300,000 in state income tax, almost 40% of which the federal government subsidizes, isn’t the kind of person I want my kids growing up around anyway (as if I could afford to live in that kind of neighborhood). I suspect the number of Illinois residents who would happily trade places with him and stay right here in Illinois is almost limitless.
Comment by steve schnorf Wednesday, Apr 23, 14 @ 2:06 pm
One other very large cost to consider is the maintenance of the infrastructure. It lasts longer there to begin with, there’s less of it, no one plows it and the repair after a bad winter doesn’t come into play. Every climate has its own problems, but Illinois vs. Florida is pretty dramatic on road costs alone.
Comment by A guy... Wednesday, Apr 23, 14 @ 2:15 pm
I’m not a big Florida fan, but growing up - I only knew of one great aunt running a motel in St. Pete. Now - I know dozens who live in Florida and even more moving in. All these Floridians, used to be Illinoisans. Why?
It is because some are retiring there. Others, because of all those retirees needing services. Over the past thirty years or more, Florida became inhabitable.
People don’t live in Illinois for the winter. Or for the beaches. Or for the tans. Or for the vacation opportunities. People live in Illinois because it is where they can make money. So what happens when Illinois makes it more costly to make money? What happens when those Illinoisans become too old to survive our winters? They head to Florida.
So, income tax isn’t a big deal in Florida, but it is in Illinois. Florida retirement is in the cards for hundreds of thousands of Illinoisans due to their aged states of being. If Illinois takes more out of our income, a move to Florida or wherever becomes a sooner proposition, than later. When we look at all the public servants retiring over the past decade - a lot of them went to Florida.
We have a bigger generation of Boomers retiring on their pension deals and retirement benefits than the next smaller generation can support. When we add generous entitlements to that, we end up with an unsupportable proposition.
I wonder what percentage of money from Illinois goes to Florida, thanks to the large retired segment of Illinoisans living there.
So Florida wins and Illinois loses. That will be the situation for at least another 15 years. What is Illinois going to do about it? Raise income taxes? That will make it even easier for Illinoisans not far from retirement - leave.
When it is no longer feasible to earn a living in Illinois- When it is no longer able to provide education for children- When it is no longer able to provide safety for it’s streets- When it is no longer able to be affordable to raise a family- then there is no reason to stay in Illinois.
Without the ability to earn a good living, the population of Illinois would match that of any other hot, humid, frigid, flat, windy part of the USA. People live here to earn a buck - not give the state of Illinois that buck.
The more regulations, the higher the taxes, the more reasons to leave for your retirement plan - out of Illinois. Everyone left behind loses even more.
Comment by VanillaMan Wednesday, Apr 23, 14 @ 2:17 pm
Steve - love your comment. My sentiments exactly.
GoM - totally correct on the higher tax brackets in other states. And add to that Minnesota and Wisconsin.
100 miles - awesome point. If Illinois had that % Medicaid match, we would have billions more to pay our Medicaid vendors, which would loosen up state GRF money for other things like education, higher education, public safety, etc.
Comment by john Wednesday, Apr 23, 14 @ 2:23 pm
In looking at this further, something is terribly off here. It’s not just Florida. It’s a definite pattern.
We have roughly the same population as Pennsylvania, yet collect $4.7 Billion more in state taxes.
We have about 1.3 million more people than Ohio, yet collect $11.4 Billion more in state taxes. On and on. None of the comparables face the budget problems we do.
It appears we are either failing to manage our money properly, or these other states are doing a MUCH better job of securing federal funding.
Comment by Formerly Known As... Wednesday, Apr 23, 14 @ 2:26 pm
VM - a flaw of your argument is that Illinois does not tax retirement income. Retirees in Illinois pay the same income tax rate for their retirement income as they do in Florida - 0%.
Comment by john Wednesday, Apr 23, 14 @ 2:27 pm
Steve, how do you feel about pro athletes who choose teams in no tax states or golfers who choose to live in Florida or Texas or Nevada to escape paying state income taxes?
Comment by Wally Wednesday, Apr 23, 14 @ 2:55 pm
=== john - Wednesday, Apr 23, 14 @ 2:27 pm:
VM - a flaw of your argument is that Illinois does not tax retirement income. Retirees in Illinois pay the same income tax rate for their retirement income as they do in Florida - 0%.====
John, Accepting your statement as true, where’s the flaw in his argument?
Comment by A guy... Wednesday, Apr 23, 14 @ 3:04 pm
–how do you feel about pro athletes who choose teams in no tax states or golfers who choose to live in Florida or Texas or Nevada to escape paying state income taxes?–
About the same as the Easter Bunny and the Great Pumpkin. They’re fictional.
Google “jock tax.” You pay income taxes in the jurisdictions you earn them. It’s been going on for some time.
Seriously, Cabrera play a series at Cominskey, or Tiger takes a purse at Medinah, and you think IDOR isn’t on it? That’s a perk of the job, dude.
By the way, what golfers choose to live in Texas or Nevada? It’s Cali and Florida.
Dude, you just make things up.
Comment by wordslinger Wednesday, Apr 23, 14 @ 3:10 pm
Would any of you be surprised if a “compromise” measure on the tax increase extension is made–making the 5% rate permanent while also going ahead with at least some of the massive cuts Quinn warns would occur with the tax increase’s sunset? I would not be surprised.
Comment by Leatherneck Wednesday, Apr 23, 14 @ 3:15 pm
Retirement income info - A quick web search turned up these sites and this from Kiplingers:
Illinois does not tax distributions from qualified employee benefit plans, including 401(k) plans; IRAs or self-employed retirement plans; traditional IRAs that have been converted to Roth IRAs; the redemption of U.S. retirement bonds; state and local government deferred compensation plans; government retirement or government disability plans, including military plans; Railroad Retirement income; retirement payments to retired partners; and lump-sum distributions of appreciated employer securities.
http://www.revenue.state.il.us/individuals/pension.htm
http://chicagoist.com/2014/03/03/civic_federations_plan_to_balance_s.php
Comment by john Wednesday, Apr 23, 14 @ 3:15 pm
== Retirees in Illinois pay the same income tax rate for their retirement income as they do in Florida - 0%. ==
Very true. But we should also recall things like the gas tax, sales tax, etc. on purchases made in-state in Florida rather than Illinois. That money goes to Florida’s coffers instead of our own.
That’s part of why the fact Illinois collects so much more state tax revenue than a more populous state like Florida stood out to me.
Comment by Formerly Known As... Wednesday, Apr 23, 14 @ 3:21 pm
“you get 5 Category-3+ hurricanes a year.”
Actually, no hurricane has hit the U.S. mainland at Category 3 or higher intensity since Katrina in 2005. That’s a major hurricane “drought” of almost 9 years so far. Hurricane ratings are based on sustained wind speed and none of the more recent hurricanes (Sandy, Irene, Isaac, etc.) had Category 3 winds (111-129 mph) at U.S. landfall, though they did reach that level while still out at sea, or during landfalls outside of the U.S. (such as in Cuba). That said, they still caused a lot of damage and high insurance rates are a factor to consider when living in any coastal area.
Comment by Secret Square Wednesday, Apr 23, 14 @ 3:22 pm
== Florida FMAP (medicaid match) is 59.72% Illinois’ is 50.75%. ==
Do we get that on the $12 million we spent for deceased Medicaid patients? /s
Comment by Formerly Known As... Wednesday, Apr 23, 14 @ 3:35 pm
PA gets $1.07 in federal money back for every $1 sent, OH gets $1.05 back and IL gets $0.75 back for every dollar sent http://taxfoundation.org/article/federal-spending-received-dollar-taxes-paid-state-2005
If you get more back than you send it makes it easier to balance a budget.
Comment by illinifan Wednesday, Apr 23, 14 @ 4:01 pm
Wow! Pretty harsh and broad assumptions.
The guy earning $6 million per year lives in a $200,000 house and has for the past 35 years.
The other part of this whole equation is the estate tax in Illinois. It’s another draw for Florida
Comment by A'mous Wednesday, Apr 23, 14 @ 4:18 pm
Georgia’s top income yax ratr is 6%.
Comment by second street Wednesday, Apr 23, 14 @ 4:20 pm
The estate tax in Illinois applies only when the estate is over $4 million… If you have under $4 mil this is a non-argument…..reality is not many of us posting here would be affected by this issue….
Comment by illinifan Wednesday, Apr 23, 14 @ 4:24 pm
Wally, most of the teams with the highest payrolls are in high tax states. Red Sox, Dodgers, Yankees, Angels and Tigers come to mind in just baseball alone.
Comment by Jorge Wednesday, Apr 23, 14 @ 4:24 pm
In case someone asks - I also looked at the same pages for the 2011 and 2010 budget (2010 before any income from the tax increase).
2010 - General = $25.9 billion, Pensions =$0 (Pension Obligation Bond was used), Transfers = $3.2 billion. Total of $29.1 billion.
2011 - General=$24.2 billion, Pensions = $4.1 billion, and Transfers = $3.9 billion. Total of $32.2 billion.
So, the general expenditures were $25.9 billion back in 2010 (before the new income tax) and the recommended budget for 2015 they are $25.5 billion (preserving the income tax).
Prior to 2010, you may recall the State received stimulus $ from the Fed government and the 1995 Pension Ramp had not fully kicked in.
We got by in 2010 by not paying the pensions out of current tax collections (issued a bond). Then, by 2011, the income tax was increased.
Comment by Archimedes Wednesday, Apr 23, 14 @ 4:25 pm
Word, a quick search of golfers on the PGA tour from 2012 shows 37 residing in Texas.
Uh, its called endorsement and appearance income. You live in TN, TX, Florida, Nevada, etc. you pay no state income tax. How much money do you think Tiger saved living in Florida with all his endorsements?
Take a MLB baseball player in Florida. He will play 81 games in the state, thus no state income tax for half the games.
Comment by Wally Wednesday, Apr 23, 14 @ 5:19 pm
While the Medicaid example accounts for only a portion of the large gap between state tax revenues, the good news is that it appears there is plenty of room for Illinois to improve our federal reimbursement and federal funding rates.
It’s not as though Florida and Pennsylvania have a secret formula. We also have an Illinoisan in the White House. Every dollar we receive in federal funding is one less dollar we have to “find” from a state tax increase or budget cuts. We can surely do better than we are.
Comment by Formerly Known As... Wednesday, Apr 23, 14 @ 6:39 pm
FKA, where did you get your Ohio and Pennsylvania numbers? The numbers I have access to say that Pennsylvania and Ohio both have higher state tax burdens than Illinois
Comment by steve schnorf Wednesday, Apr 23, 14 @ 9:47 pm
Anon 9:20:
Georgia has a higher personal income tax and a lower income tax than Illinois.
If your neighbor moved to Atlanta for tax purposes…well, I would have recommended Nashville personally.
Comment by Yellow Dog Democrat Wednesday, Apr 23, 14 @ 10:51 pm
Wally, that’s kind of a problem when Florida teams don’t exactly pay their players on par with the teams I mentioned. Slinger is right. You do just make stuff up.
Comment by Jorge Wednesday, Apr 23, 14 @ 11:10 pm
S.S. - US Census Bureau 2013 Annual Survey of State Government Tax Collections released on April 8. The press release and link to data tables are here http://www.census.gov/govs/statetax/
The 5 sources of state revenue they take into account while calculating “Total Taxes” are Property Taxes, Sales and Gross Receipts Taxes, License Taxes, Income Taxes and Other Taxes.
Comment by Formerly Known As... Wednesday, Apr 23, 14 @ 11:14 pm
That’s why the only thing I can think of to really explain the discrepancy, and it seems like others here are of a similar mindset, is Federal funding.
It seems impossible a state the size of Pennsylvania or Florida could collect so much less in state tax revenues and still function well while avoiding similar budget problems. That money has got to be coming from somewhere. Additional ideas are obviously welcome.
Comment by Formerly Known As... Wednesday, Apr 23, 14 @ 11:57 pm
Jorge, tell me what is wrong in the info I listed. Did Miami pay Lebron a lot of money? Did they pay DWade a lot of money.
Did Tiger save a LOT of money living in Florida by not having to pay a state income tax on his endorsement income?
Tell me one thing I have factually wrong in my post.
Comment by Wally Thursday, Apr 24, 14 @ 7:42 am