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With the failure of the graduated income tax, will the state finally close some tax loopholes?

Monday, Nov 16, 2020

* From the GOMB’s five-year fiscal forecast

As the cuts that would be required to bring Illinois’ budget to balance would harm education and human services programs and damage essential areas of the state’s economy, the Governor continues to believe that cuts alone cannot be the solution and revenue adjustments need to be considered as well. The Governor will work with the legislature to identify corporate and business tax loopholes that can be closed and tax adjustments that can be made that will minimize the impact to lower-and middle-class families while ensuring that Illinois can meet its financial responsibilities. Furthermore, the Governor will continue to work with the Congressional delegation to support additional federal funding to help Illinois bridge the loss of revenues brought on by the COVID-19 pandemic.

* People have been trying for years and years to close corporate loopholes. But since corporations played a major role in the defeat of the “Fair Tax,” there might just be an opening

Also available is a range of less-draconian actions that might, in combination, generate enough revenue to fill the gap, if they survive the political gantlet.

A group of Democrats proposes closing corporate tax loopholes. Sales, use, income tax and economic development credits and exemptions totaled nearly $8.5 billion in the 2018 fiscal year. In a press release, 14 House Democrats say “all are on the table.” Rep. Mike Zalewski estimates an “aggressive approach” to cutting some of those could net $1 billion.

* And because of that effort over the years, we have plenty of ready-made research. This is from the Center for Tax and Budget Accountability

Closing Corporate Tax Loopholes: $826.4 - $846.4 million

1. Repeal the Single Sales Factor - $96 million. Illinois changed its method for determining the corporate income tax, from a three-part formula to the single sales factor. Under the single sales factor, corporate income taxable in Illinois is determined solely on the basis of a company’s in-state sales. Under the prior method, in addition to sales, the value of a corporation’s property and payroll in Illinois were considered. Under the single sales factor, large, multinational companies who have a strong presence (facilities and employees) in Illinois, and are therefore the largest beneficiaries of state services, receive major income tax cuts. Small mom and pop shops, who principally make all their sales in the state, receive no benefit. According to a report issued by then Illinois Comptroller, Republican Loleta A. Didrickson, 32 companies were projected to gain at least $1 million per year in tax savings. The result, a net tax revenue loss to the state and local governments that the Illinois Department of Revenue estimated reached $96 million in FY 2001 ($63M state and $33M local) (This is the last year the Department of Revenue analyzed the loss to the state).

2. Reduce the Retailers Discount. The Retailers Discount was enacted in 1959 to reimburse businesses for the burden of computing and collecting the state sales tax that applied to their sales. Under the statute, retailers keep 1.75% of the sales tax they collect. While this discount served a legitimate purpose in 1959, its value is questionable today. With computerized collection and accounting systems prevalent, the cost of collecting sales taxes, especially for large retailers, is built into software packages and is negligible. Twenty-four states do not provide any discounts for sales tax collection. Of the 26 that still have these outmoded discounts, 10 have capped the maximum discount. Capping the Illinois discount at 1.75% of the first $1 million in sales is a practical solution. This preserves the discount for small businesses while greatly reducing the cost of this tax expenditure. This sensible change will save $80-100 million annually.

3. Eliminate public subsidies to the horse racing industry: Illinois currently gives this horse racing industry millions in tax breaks. Elimination of breaks would generate $48 million.

* Also

Other Corporate Tax Loopholes

    • Newsprint and Ink to Newspapers and Magazines Exemption: $41 million
    • Manufacturing and Assembling Machinery and Equip Exemption: $164 million
    • Sales of Vehicles to Automobile Rentors Exemption: $43 million
    • Enterprise and Foreign Trade Zone Dividend Subtractions: $2.4 million
    • Enterprise and Foreign Trade Zone High Economic Impact Business Exemption: $37
    million
    • Timely Filing and Full Payment Discount: $28 million
    • Trade-in allowance: $20 million
    • Real Estate Investment Trusts – For tax years ending on or after Dec 31, 2008: $40
    million
    • Redefining “business income” to include all income apportionable to Illinois by the U.S. Constitution: $29 million
    • Sales sourcing rules – for corporate income tax – replace cost of performance rule with market state approach for service industries: $40 million special industry rules (financial organizations/transit companies): $60 million
    • Eliminate tax benefit of related party transactions (dividends from subsidiaries with no business substance/insurance premiums paid to capture insurance companies): $40 million
    • Discharge of debt: $4 million
    • Expense disallowance for exempt securities income: $25 million
    • Withholding on non-resident partners/subchapter S shareholders: $4 millions
    • Corporate Franchise Tax Amnesty: $25 million

Some of those were accomplished in the capital bill.

* And then there are these

Closing Personal Tax Loopholes: $670 - $715 million

1. Create a means test for the Illinois tuition tax credit: There currently is no income limit on the Illinois tuition tax credit. As a result, relatively affluent taxpayers have received by far the most benefits from this tax break. Taxpayers with incomes of $50,000 or more per year accounted for 77% of the tax relief in 2004. Taxpayers with incomes of $100,000 or more accounted for almost 40% of the credit. Limiting the credit to families earning $60,000 a year or less would preserve the credit for low- and moderate-income families while saving the state $40-$45 million annually.

2. Subject pension income earned over $75,000 to taxation: Illinois is one of only three states that exempts all pension income from taxation. Low- and moderate-income seniors work to make ends meet, and subsequently pay taxes on their wages. Affluent seniors, on the other hand, do not have to work and also avoid paying taxes on their pensions. Exclusion of all pension income costs the state over $800 million annually in new revenue. Subjecting pension income over $75,000 to taxation would generate $200 million in new revenue annually.

3. Eliminate or means-test the Property Tax Credit: The Property Tax Credit costs the state of Illinois over $400 million a year. The credit primarily benefits wealthy homeowners, as only 20% of individuals earning $25,000 a year or less own a home. Creation of a means-test for this tax credit would preserve the benefit for low- and middle-income families while saving the state an estimated $200-$240 million annually.

4. Coordination of credits/exemptions: Multiple forms of tax credits/exemptions could duplicate policy purposes. Consolidating all of them into one credit/exemption could eliminate duplication and produce more targeted benefits. This could generate up to $200 million.

Other ideas are here.

- Posted by Rich Miller        

81 Comments
  1. - Hieronymus - Monday, Nov 16, 20 @ 11:28 am:

    Don’t tax you. Don’t tax me. Tax that guy behind that tree.


  2. - City Zen - Monday, Nov 16, 20 @ 11:32 am:

    ==Eliminate or means-test the Property Tax Credit==

    They already did that in 2017. Single filers earning over $250,000 cannot claim the credit.


  3. - very old soil - Monday, Nov 16, 20 @ 11:33 am:

    Sounds like a good start. One question: Is the ink for fax machines tax exempt? Asking for a friend. s/


  4. - Grandson of Man - Monday, Nov 16, 20 @ 11:36 am:

    Corporations get a 40% annual raise, thanks to the Trump tax cuts. There was no meaningful economic gain from the tax cuts (pre-COVID), as expected. Times are tough, and we just can’t cut the poor, sick, schools, etc, and raise the state income tax. Time to close some corporate tax loopholes.


  5. - Nathan - Monday, Nov 16, 20 @ 11:37 am:

    Most all these sound reasonable to me, especially that one about how stores keep 1.75% of the sales tax they collect. I didn’t know that the sales taxes I (gladly) pay go to the stores.


  6. - Perrid - Monday, Nov 16, 20 @ 11:37 am:

    Well, if you’re right that there’s no way the flat tax gets a hike (which surprises me), then yeah, this sounds like a good idea. Doesn’t help much this year, but every bit helps.


  7. - Friendly Bob Adams - Monday, Nov 16, 20 @ 11:38 am:

    Hieronymus- The pro fair tax side should have used that slogan in their ads.


  8. - Anyone Remember - Monday, Nov 16, 20 @ 11:41 am:

    Countdown to a “Tax my haircut?” meme in 3 … 2 … 1 …


  9. - notsosure - Monday, Nov 16, 20 @ 11:45 am:

    One person’s loophole is someone else’s reasonable tax provision designed to remedy inequities elsewhere in the law. If you’re using the tax expenditure list, then the #1 loophole in the state, by far, is the retirement exemption from income tax. Which benefits the wealthy disproportionately. I’m glad to see CTBA has it on their list.


  10. - Wow - Monday, Nov 16, 20 @ 11:45 am:

    Man: will April and May session be brutal


  11. - jimbo26 - Monday, Nov 16, 20 @ 11:46 am:

    It made some sense to give retailers a little money to collect sales tax back when it was computed using an old fashioned adding machine and sending the money via the mail to the State. Computerization means big companies are making much more than the cost to collect.


  12. - anon - Monday, Nov 16, 20 @ 11:48 am:

    Fine - restrict the pension exclusion. I’ll vote for that the minute that childless filers are exempt from paying local school property taxes.


  13. - Oswego Willy - Monday, Nov 16, 20 @ 11:48 am:

    To the post,

    The Governor’s office should come up with TWO menus;

    One, if the Raunerites wanna make this “go it alone, governors own” (governors own, they always do) then “these are the loopholes leaving… and focus on downstate, farms, business, retail, get really precise to picking the ones most hurtful to Raunerites.

    The other, have a list of reasonably measured cuts based on financial and fiscal thoughts, political lifts, and where Republicans see working for a better state makes sense to a political bend and the Republican constituencies to buy in too.

    Of course, a tax increase still might be needed, but how damaging the majority wants to make it…

    … that’s what is really on the table.

    These loopholes will be, at least some of not most, closing.

    Dunno if sitting it out makes sense.


  14. - Oswego Willy - Monday, Nov 16, 20 @ 11:50 am:

    === retirement exemption from income tax===

    The Frerichs Tax, taxing retirement income isn’t happening.

    Only Mike Frerichs stands tall to taxing retirement income, it’s up for discussion with him. Frerichs said so.


  15. - Cool Papa Bell - Monday, Nov 16, 20 @ 11:51 am:

    Close the sales tax loophole.

    Change the tuition tax credit, incentivise the tax credit for going to school in Illinois (if it isn’t already done so)

    Close up some of the loopholes for corporations.

    Cut a billion from spending.

    Closing “loopholes” and cutting spending is easier to explain and is harder to run against.


  16. - Sue - Monday, Nov 16, 20 @ 11:53 am:

    The majority will need to go it alone. Does anyone truly believe the Dems will commit suicide taxing even one dollar of retirement income. As for the newspaper exemption- they are having a hard time surviving as it is. Want to find a billion dollars- outlaw the pension pickups statewide but required all effected employers to continue paying the savings into a 10 year sunset fund dedicated solely to pension funding


  17. - DuPage - Monday, Nov 16, 20 @ 11:54 am:

    Taxing retirement=stepping on the third rail.


  18. - Oswego Willy - Monday, Nov 16, 20 @ 11:56 am:

    - Sue -

    Weren’t you going it alone here?

    === The majority will need to go it alone.===

    Downstate loopholes will be decimated, including hurting farmers, and loopholes most found in rural areas

    The majority has no need for thinking they should go alone, if they’re told to, then Raunerite areas of taxing really don’t need loopholes.


  19. - JS Mill - Monday, Nov 16, 20 @ 11:58 am:

    =I’m glad to see CTBA has it on their list.=

    Since at least 2004. They also had a dedicated sales tax that would be applied to the legacy debt and structural imbalances.

    We could have fixed most of our problems back in 2004 if anyone would have listened to Martire…but he is controlled by unions./s


  20. - Anyone Remember - Monday, Nov 16, 20 @ 11:59 am:

    “… get really precise to picking the ones most hurtful to Raunerites.”

    When it comes to DOC facility / downstate university closing(s), take that same approach. By voting no … “They sowed the wind, now they are going to reap the whirlwind.”


  21. - Sue - Monday, Nov 16, 20 @ 11:59 am:

    OW- there are R’s in every district and D’s south of I 80. Your constant remarks about taxing Rauner geographic areas make no sense and are blatantly violative of the 14th amendment. Life is not as simple as you seem to believe


  22. - Oswego Willy - Monday, Nov 16, 20 @ 12:03 pm:

    === there are R’s in every district and D’s south of I 80.===

    Meh. More Ds in upstate. More D districts north of I-80

    Hammer downstate, shake the Eastern Bloc.

    Governors own. Welp, funny thing about a supermajority going it alone… they can hurt those in the super minority so easily with precise and pointed budgetary lines.

    === blatantly violative of the 14th amendment.===

    Can’t some argue the loopholes are special help for some and targeting others not equal?

    I can’t help downstate is a tax eater.

    We need to stop the tax eaters.

    :)


  23. - Eloy - Monday, Nov 16, 20 @ 12:04 pm:

    Retirement tax and taxes on services aren’t closing loopholes or flattening the tax. They would be implementation of new taxation statutes.


  24. - Oswego Willy - Monday, Nov 16, 20 @ 12:05 pm:

    === Life is not as simple as you seem to believe===

    If it was you’d never come back here as you promised.

    Oh, sorry… yeah, in a budget, it is.

    Heck, Rauner decided Illinois didn’t even need a budget… twice.

    “Loopholes are bad”, amirite?


  25. - Candy Dogood - Monday, Nov 16, 20 @ 12:10 pm:

    It’s worth pointing out that the report was published in 2007 and reflects a smaller economic base in addition to lower tax rates than what is currently assessed in those numbers.

    Having an income limit for the retirement income tax subtraction is fine — but I’m not sure how much trust I’d place in the folks to message that correctly after the Fair Tax messaging debacle.


  26. - JS Mill - Monday, Nov 16, 20 @ 12:10 pm:

    =They would be implementation of new taxation statutes.=

    Taxes on services would only be an expansion of sales tax, not a new tax. They are selling a service.


  27. - City Zen - Monday, Nov 16, 20 @ 12:10 pm:

    ==There currently is no income limit on the Illinois tuition tax credit==

    Again, in 2017, the education expense credit was capped at $250,000 for single filers.


  28. - Maximus - Monday, Nov 16, 20 @ 12:10 pm:

    These are some good ideas and many should have been implemented already. It’s a shame the graduated tax had to fail before bringing these to the table.


  29. - Fav human - Monday, Nov 16, 20 @ 12:19 pm:

    One “trust restoring”thing that might help is this: remove (again) the school pension boost at the last minute that got restored a couple years ago. That was the sort of thing that really ticks people off and makes everyone think that the state will always pull a shenanigan or two.

    It won’t prevent a lot of future increases but it will say that at least they are serious this time.


  30. - Oswego Willy - Monday, Nov 16, 20 @ 12:20 pm:

    See you in church, - Ted -


  31. - DuPage - Monday, Nov 16, 20 @ 12:27 pm:

    One thing the state could eliminate is the air pollution testing on cars. 30 or 40 years ago, they served a purpose, but not much anymore. The electronic sensors that control timing and fuel mixtures, plus catalytic converters, have reduced pollution to levels far, far, below the goals of the testing program. Almost all of the pollution reduction was the result of older cars being replaced by newer cars. Very little reduction is now being achieved by the state testing facilities. They have now become a waste of state money and time of drivers. They should be cut out the budget.


  32. - Amalia - Monday, Nov 16, 20 @ 12:29 pm:

    @DuPage, that is a very interesting post.


  33. - Commisar Gritty - Monday, Nov 16, 20 @ 12:33 pm:

    I’ve seen people get banned in these forums for a heck of a lot less than what Ted just posted. Sorry to be the one to break it to you, but Seth McFarlane stopped being funny over a decade ago and your teddy bear movie stunk.


  34. - Rich Miller - Monday, Nov 16, 20 @ 12:33 pm:

    ===See you in church, - Ted - ===

    Won’t see him no more.


  35. - City Zen - Monday, Nov 16, 20 @ 12:36 pm:

    ==One “trust restoring”thing that might help is this: remove (again) the school pension boost at the last minute that got restored a couple years ago.==

    Yep. If there’s money for this, there’s money for everything else.


  36. - Huh? - Monday, Nov 16, 20 @ 12:36 pm:

    Why hasn’t ted at 12:14 been deleted and banned for life? That type of language inappropriate for any social media.


  37. - James the Intolerant - Monday, Nov 16, 20 @ 12:44 pm:

    Good old Goodfellas.
    I backed out of our weekend getaway to Fla Rich,
    maybe springtime. If we had more time to drive, we might reconsider.


  38. - Rich Miller - Monday, Nov 16, 20 @ 12:46 pm:

    Hey, Ted, or whatever your name is. I know where you live now and I’ll be sending the police to your house if you ever post like that here again.


  39. - Really - Monday, Nov 16, 20 @ 12:48 pm:

    Some good ideas mentioned above. In addition to eliminating some loopholes can we also get the across the board reductions to state spending as part of this? How about a moratorium on new spending or new programs or new mandates until the outstanding bill level is reduced to a certain level or eliminated? Taxing retirement income about $75,000 is a good idea as well.

    I must say the idea of punishing folks downstate is outright silly, petty and vindictive. Most of the votes are in the northeast corner of the state and folks on this blog are kidding themselves thinking that this lost only because of folks south of I-80. Elections are supposed to have consequences and they shouldn’t be about punishing only the people that didn’t agree with you.


  40. - Give Us Braabbas - Monday, Nov 16, 20 @ 12:49 pm:

    Willy, you really keep hammering Frerichs, it might make Tom Cross jealous. :-) Taxing Pensions in any way is a Third Rail - even a modest one is not only not going to get the votes to pass, but it will sink the career of any politician associated with it. As Mike F. is finding out.

    The rest of that list, I certainly could live with. I can’t believe the rich guys that worked against the Progressive tax didn’t calculate that these alternatives would come into play, and so my assumption is, they figured it was a fair trade-off, and they’re still many many dollars ahead.

    I expect what’s to come short-term are negotiations with AFSCSME to give-back some on health care, to keep jobs. Next, a pause in the IDOT building program, or at least a slowdown, until federal help comes in. But I think there’s hope on the horizon, if we can hold on another ten months. Two vaccines are proving very effective and when the distribution gets really rolling, and mitigations start to lift, you are going to see a bacchanalian era of epic consumer spending and economic boom times, not seen since the post-WW2 boom, as pent-up demand seeks long-delayed gratification. With spending comes tax revenue.


  41. - RNUG - Monday, Nov 16, 20 @ 12:49 pm:

    == if you’re right that there’s no way the flat tax gets a hike ==

    First they will close some of the loopholes … but unlikely to touch retirement

    Second they will expand the sales / use tax on services. While we are here, strictly enforcing the Use Tax line for out of State purchases could probably bring in some money; most people skip past it on their IL-1040.

    Third will be hiking the fault income tax rate, with an adjustment and income cap on the personal exemption to shield the lower income groups.


  42. - Oswego Willy - Monday, Nov 16, 20 @ 12:54 pm:

    === Taxing retirement income about $75,000 is a good idea as well.===

    It’s not a good idea at all if it can’t get 60/71, 30/36… and/or a governor’s signature. You know this already.

    === I must say the idea of punishing folks downstate is outright silly, petty and vindictive. Most of the votes are in the northeast corner of the state and folks on this blog are kidding themselves thinking that this lost only because of folks south of I-80.===

    I’ll let you in on a lil hint. ‘Tween us.

    It’s not the votes that are dictating it, it’s the votes in the GA that are being withheld that are demanding it.

    Capiche?

    === Elections are supposed to have consequences and they shouldn’t be about punishing only the people that didn’t agree with you.===

    It’s about the ~45 and 18… nothing more.

    === you really keep hammering Frerichs, it might make Tom Cross jealous.===

    If he gets off the golf course, you might be right on the nose.

    :)

    Be well.


  43. - Eloy - Monday, Nov 16, 20 @ 12:59 pm:

    Expansion of sales tax isn’t going to happen. As much sense as it makes on paper, it polls horribly and JB pummeled his opposition with it in the primary. It’s as good as ruled out.


  44. - JS Mill - Monday, Nov 16, 20 @ 1:01 pm:

    =One “trust restoring”thing that might help is this: remove (again) the school pension boost at the last minute that got restored a couple years ago. That was the sort of thing that really ticks people off and makes everyone think that the state will always pull a shenanigan or two.=

    It won’t prevent a lot of future increases but it will say that at least they are serious this time.
    =Yep. If there’s money for this, there’s money for everything else.=

    The max was 6% then it was 3% then is was back tio 3%.

    Since you are both experts in school finance, how much did the change cost? Adding, there was a reason for the change. With all of your expertise in school finance you should know that reason./s


  45. - Captain Obvious - Monday, Nov 16, 20 @ 1:27 pm:

    I wonder if they had closed up these loopholes in the first place if the progressive unfair tax might have had a better shot at winning. You know, show of good faith and all.


  46. - City Zen - Monday, Nov 16, 20 @ 1:31 pm:

    ==income cap on the personal exemption to shield the lower income groups.==

    The income cap on the personal exemption is $250,000.


  47. - City Zen - Monday, Nov 16, 20 @ 1:39 pm:

    ==there was a reason for the change==

    Because it impacted every year of service when it should have only applied to increases beyond year 25 (the pension spike years). But instead of fixing it, they threw the entire thing out, per union request.

    ==how much did the change cost?==

    More than $0. If the state has money to pay for pension spikes for employees about to quit, it has money to pay for anything else it needs.


  48. - Oswego Willy - Monday, Nov 16, 20 @ 1:49 pm:

    === More than $0.===

    Show your work.

    This is your typical bit.

    You want the money seen, show it.


  49. - MJH - Monday, Nov 16, 20 @ 2:01 pm:

    As a working class older person, I approve closing corporate loopholes, and means-testing personal loophole.Over 75K seems fair for pension taxation. We’ll work until we die, therefore will pay taxes until we die on our working income.


  50. - Fav Human - Monday, Nov 16, 20 @ 2:06 pm:

    how much did the change cost?

    I said it was likely not much. But that doesn’t matter. It is a “trust” thing.


  51. - Lucky Pierre - Monday, Nov 16, 20 @ 2:06 pm:

    Hammer downstate

    Raunerites to blame for everything

    See you in Church

    All in the space of minutes

    Hypocrisy alert is not operational in Oswego

    Love your neighbor, accept your differences, move on, lighten up and count your blessings OW


  52. - Really - Monday, Nov 16, 20 @ 2:13 pm:

    If the folks in the legislature aren’t willing to tax retirement income above a certain limit like most every other state in the US then they aren’t doing their job. Everything should be on the table to solve the problem that they helped to create. If they can’t get to 60/71 and 30/36 with a signature from the Governor then they should step down and move on. I expect they really aren’t that interested in solving the problem unless they are willing to look at every option to solve it. If we can’t fully fund all of these six figure pensions maybe thise folks should help the rest of us fund them.


  53. - A - Monday, Nov 16, 20 @ 2:21 pm:

    ==fully fund all these six figure pensions….==

    Watch it.That’s hyperbole. Check out the average pension amount paid per fund. Most pensioners don’t even approach six figures.

    It’s the equivalent of believing that if you work in private business, you must be making Bill Gates money. Ignorant.


  54. - Oswego Willy - Monday, Nov 16, 20 @ 2:25 pm:

    Oh - Lucky Pierre -, LOL

    === Raunerites to blame for everything===

    Raunerite thinking and making Dems go alone will lead to needless pain.

    ===See you in Church===

    Prolly the nicest thing I can say. I don’t wish this virus on anyone.

    ===Hammer downstate===

    If you don’t get my drift, it’s no wonder your bot programming lacks after Rauner and Trump lost.

    === Hypocrisy alert is not operational in Oswego===

    What hypocrisy?

    Just because you can spell big words, apparently you have no clue what they mean.

    Your selective reading too, welp, says a great deal as why your bot programming fails too.


  55. - Oswego Willy - Monday, Nov 16, 20 @ 2:31 pm:

    === If the folks in the legislature aren’t willing to tax retirement income above a certain limit like most every other state in the US then they aren’t doing their job.===

    Legislating is messy. You’re angry because there’s not the votes. Your typical tripe.

    === Everything should be on the table to solve the problem that they helped to create. If they can’t get to 60/71 and 30/36 with a signature from the Governor then they should step down and move on.===

    Being an anarchist isn’t a winnable political position.

    You should finish your drink at the end of the bar and yell at the Tee-Vee.

    === If we can’t fully fund all of these six figure pensions maybe thise folks should help the rest of us fund them.===

    Aaannndd… there it is.

    Pensions.

    IPI, Wirepoints… down the dial a bit.

    You have no desire to find solutions, you are angry at pensions.

    I’ve been grateful to your honesty as of late, didn’t see the “throw the… out” anarchy angle, so at least that’s new.

    Here’s the sitch;

    Do the doable, make it bipartisan, make the budget an honest chance for Illinois… or the super minority can feel heavy pain and hard cuts for areas that are tax eaters.

    How’s that for raw honesty.


  56. - City Zen - Monday, Nov 16, 20 @ 2:33 pm:

    ==Check out the average pension amount paid per fund.==

    Then check out the average years of credited service that corresponds to that average pension.


  57. - Oswego Willy - Monday, Nov 16, 20 @ 2:37 pm:

    - City Zen -

    Your continued “concerned trolling” between labor and pensions is dizzying.

    Of all the loopholes and options above, and the link included, it’s still pensions and organized labor.

    You ever find the raw number on that savings?

    Lemme know when you have the number, and the cite too.


  58. - Anonymous - Monday, Nov 16, 20 @ 2:52 pm:

    =Because it impacted every year of service when it should have only applied to increases beyond year 25 (the pension spike years). But instead of fixing it, they threw the entire thing out, per union request.

    ===how much did the change cost?==

    More than $0. If the state has money to pay for pension spikes for employees about to quit, it has money to pay for anything else it needs.=

    So, you do not know the answer to either of the questions but you decided to pontificate nonetheless.

    6% isn’t a spike, BTW. It is a raise.

    3% was problematic because districts already had contracts that were in effect and would have moved many into a penalty of 13:1 for every dollar over the 3%. When looking at a salary schedule, a standard for the industry, adding a percentage to the base has a compounding effect when the steps are counted that ofetn puts people over 3%. And 3-6% isn’t a huge raise by any estimate. It maybe more than some get, but it is far less than others.

    Our highest teacher salary w TRS is 72,000. If that was the figure a pension was based on it would be 54,000. We are not out of the norm for the hundreds of rural districts in illinois.

    Contrary to the uninformed that post here, 54,000 is not a huge pension.


  59. - Oswego Willy - Monday, Nov 16, 20 @ 2:59 pm:

    === Love your neighbor, accept your differences, move on, lighten up and count your blessings===

    - Lucky Pierre -… you supported Trump.

    Please stop.

    To the post,

    The creativity to fixing a budget shortfall is going to boil down to if Raunerites see the budget and taxes only in a political end game, and are willing to let constituents feel real severe pain, or try to make an attempt to seem engaged and still have “governors own” in their back pocket with a more spread out pain.

    The axiom of never get in the way of your opponent making mistakes (any and all variations to this) isn’t seen as “sit passively by and get our constituency hammered in hopes to be relevant someday”


  60. - A - Monday, Nov 16, 20 @ 3:20 pm:

    Pension jealousy is an ugly thing


  61. - A Jack - Monday, Nov 16, 20 @ 3:23 pm:

    I would think that taxing retirement over $75k would be unconstitutional under the flat tax. I have no problem with that amount, I just don’t think it would be constitutional just like taxing incomes over $250k at a higher rate isn’t currently constitutional.


  62. - Jason - Monday, Nov 16, 20 @ 3:54 pm:

    As for a renegotiation with AFSCME, I think that most people would rather take furlough days then pay a higher rate on Healthcare which already went up and will go up again twice in the next two years. Furloughs are a win-win. The State saves money and employees get something back for their lower pay which is free time which most people need especially with how busy life is in general


  63. - City Zen - Monday, Nov 16, 20 @ 3:58 pm:

    ==So, you do not know the answer to either of the questions but you decided to pontificate nonetheless.==

    Let me see if I understand this correctly. There are over 800 school districts, each with unique salary schedules, each with varying numbers of eligible retirees in any given year. I am then to compile this data, then extrapolate the compounding factor over decades? Hard pass. Guessing it is much easier for you to prove it costs the state nothing.

    Again, any raise in excess over what the collective bargaining unit receives and only offered to retiring employees is indeed a pension spike. I’m sure you have to sell it otherwise, but it is what it is.


  64. - Oswego Willy - Monday, Nov 16, 20 @ 4:01 pm:

    === There are over 800 school districts, each with unique salary schedules, each with varying numbers of eligible retirees in any given year. I am then to compile this data, then extrapolate the compounding factor over decades?===

    It’s not anyone’s fault you wanna make ridiculous things a point.

    Show the numbers.

    === Guessing it is much easier for you to prove it costs the state nothing.===

    Nope.

    As a zealot of the anti-labor and anti-pensions, make your argument.

    The numbers.


  65. - Oswego Willy - Monday, Nov 16, 20 @ 4:02 pm:

    “Facts only matter if you try to show my facts are irrelevant”

    - “City Zen”, probably


  66. - Thomas Paine - Monday, Nov 16, 20 @ 4:06 pm:

    As I said over and over this summer, the alternative to raising income taxes on the rich was never gonna be raising income taxes in the working class.

    It was so preposterous that the Pritzker administration never should have mentioned it.

    They should name the tax reform bill “The Baise-Griffin Bill.”

    The corporate tax loopholes will be closed, and manufacturing tax breaks will be closed first.

    Sales and Use tax loopholes will be closed, and the first thing they will close is the Sales and Use Tax exemption on fund management services provided by Citadel.

    When cuts are made, they will start with closing facilities in Republican districts.

    There will be no Plan B. You aren’t negotiating with Cullerton anymore, JB needs the money however you can get it and you just repeated Madigan’s name 438,271,938 times.


  67. - Hieronymus - Monday, Nov 16, 20 @ 4:18 pm:

    === I must say the idea of punishing folks downstate is outright silly, petty and vindictive. Most of the votes are in the northeast corner of the state and folks on this blog are kidding themselves thinking that this lost only because of folks south of I-80.===

    It’s about making sure that the (mostly) republican lawmakers in those “downstate” districts show up for hard, but good-faith negotiations and more importantly, with “yes” votes on the board to actually stave off those cuts.


  68. - RNUG - Monday, Nov 16, 20 @ 4:33 pm:

    == The income cap on the personal exemption is $250,000. ==

    Watch that number get lowered


  69. - Spfld Westsider - Monday, Nov 16, 20 @ 5:28 pm:

    @CPB

    “ Change the tuition tax credit, incentivise the tax credit for going to school in Illinois (if it isn’t already done so)”

    I like it. For those that qualify, if the kid goes to an IL school, they get 100% of the credit amount. And if it’s out of state, then they get 50% max


  70. - Last Bull Moose - Monday, Nov 16, 20 @ 5:53 pm:

    The Fair Tax would have made it easier for the GA to split the taxpayers into groups and then raise taxes on targeted groups.

    The “loopholes “ are previously identified groups. It is natural to go after them first. They will find it harder to resist. Divide and conquer is basic politics.


  71. - California Guyy - Monday, Nov 16, 20 @ 6:00 pm:

    If Number 2 (the sales tax admin payment) is no longer needed, why would the State take it? Kind of a weird argument. “Businesses keep 1.75% of the sales tax to cover the costs of administering the tax. It’s not expensive to administer sales tax anymore, so instead, we (the State) will keep that 1.75%.”


  72. - Captain Obvious - Monday, Nov 16, 20 @ 6:15 pm:

    Do you suppose at the end of his life Willy is going to look back and regret that he didn’t spend more time arguing about politics with strangers on the internet? He never seems to get enough of it. Not relevant to this post necessarily, just some genuine concern for a fellow human being’s mental health.


  73. - Oswego Willy - Monday, Nov 16, 20 @ 6:21 pm:

    - Captain Obvious -

    I’ll be fine.

    The fact you’re worried about me arguing with strangers.. like yourself… on the internet, while using the internet… to attempt to be a concerned troll…

    I don’t worry about you, that’s just sad.

    I’ll leave some rent money for the space I’m occupying in you head.

    :)


  74. - Fed Up Taxpayer - Monday, Nov 16, 20 @ 7:28 pm:

    One can only hope that the Willy is at least paying for a subscription as he constantly dominates the comments


  75. - LastOneIn - Monday, Nov 16, 20 @ 8:53 pm:

    Close the scam where someone can get a deduction for pretending to open a bit of their land to the public as a park. The public rarely knows about these “parks” and their open times are almost nonexistent.


  76. - Chris Waller - Monday, Nov 16, 20 @ 9:23 pm:

    Give OW credit. Hey, I live downstate.
    Shake the Eastern Bloc is spot on.
    Industrialized farming is not farming.
    Living on subsidies and pointing at everyone else.


  77. - 4 percent - Monday, Nov 16, 20 @ 11:27 pm:

    The top four tax expenditures are all individuals. Presume they’re in the list as well? /s

    1. Retirement & social security - $2.2 billion
    2. Food & medicine - $1.8 billion
    3. Standard exemption - $989 million
    4. Real estate credit - $589 million

    These are $5.5 billion of the $9.2 billion total. Guess if the people voted “no” they should make them pay.


  78. - Really - Tuesday, Nov 17, 20 @ 9:19 am:

    Well, based on the fact that they can’t be bothered to meet, and won’t put in a mechanism to meet over Zoom or online, it appears to many taxpayers that they really don’t care whether this problem gets fixed or not. The kids in our school district are doing hybrid schooling and as a member of our school board, we have a meeting, in person this week. We have figured it out, and we don’t get paid or receive pensions for our efforts. Maybe they could quit being so lazy and actually work on behalf of their constituents. Unless this is going to be just another Madigan producing a shell bill in January, filling it with garbage, and passing it before anyone has a chance to even read it. Wouldn’t surprise me because stuff like that is why Illinois is in the mess it is in.


  79. - Oswego Willy - Tuesday, Nov 17, 20 @ 9:27 am:

    === taxpayers===

    We’re all taxpayers… all of us.

    === pensions===

    It’s actually pathetic, sadly pathetic, as you pat yourself on the back you just can’t help yourself with the “pensions”

    You’re a One Note Nelly… it boils down to pensions.

    === Unless this is going to be just another Madigan producing a shell bill in January, filling it with garbage, and passing it before anyone has a chance to even read it. Wouldn’t surprise me because stuff like that is why Illinois is in the mess it is in.===

    I hope that made you feel better.

    Your grievances would make IPI proud.


  80. - Really - Tuesday, Nov 17, 20 @ 10:58 am:

    Truth hurts, doesn’t it. The pensions are the biggest part of our financial problems and there is no fix that doesn’t involve them. My spouse is Tier 1 and I would like to see something done to fix this so she can count on receiving that someday.


  81. - Oswego Willy - Tuesday, Nov 17, 20 @ 11:01 am:

    === The pensions are the biggest part of our financial problems and there is no fix that doesn’t involve them.===

    That pesky constitution disagrees with ya.

    The adults are trying to work the problem, yelling at the tee-vee weatherman isn’t helping, but your silliness is noted.

    === My spouse is Tier 1 and I would like to see something done to fix this so she can count on receiving that someday.===

    “Ok”… lol

    Has she missed a check? Why do you think she hasn’t?

    You get more comical by the comment.


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