* We’ve talked a little about this before, but here’s Greg Hinz…
Democrats may have provided most of the votes to override Gov. Bruce Rauner’s veto of the state’s new budget and income tax hike, but the Dems in the process picked up an idea that GOP fiscal conservatives have been pushing for years: reduced money for municipalities and other local governments.
My reference is to a little-noticed provision in the budget implementation bill, or BIMP, that imposes a 2 percent “collection fee” on sales taxes gathered for the locals by the Illinois Department of Revenue.
The handling charge will apply to sales taxes levied by local governments, including not only obvious targets such the city, Cook County, Schaumburg, Evanston, et al., but also the Regional Transportation Authority and levies by the Metropolitan Pier & Exposition Authority on automobile rentals and hotels, according to an analysis by the Illinois Municipal League.
The levy will not apply to the 1.25 percent local share of the state’s mandatory 6.25 percent sales tax, only to additional levies beyond that figure that are imposed by local governments. But it’s still an estimated $60 million-a-year hit, says the league, which is not at all happy about the loss.
This idea was first floated by the governor’s office.