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Rich asked me to come up with the QOTD. Here’s a general one that I’ve been curious about…
Everyone agrees that this is the “Year of the Money.” Essentially every major state issue/responsibility/obligation is clamoring for attention. Everyone not only claims to want increased funding but say they need it. The next couple months will basically be a battle over how to raise the necessary money (if at all) and who to give it to.
Question: Looking at the big picture, how would you specifically rank the current priorities: Education, Health Care, Mass Transit, Capital Projects, Pensions, and Property Tax Relief? Assuming that there won’t be the money for everything, in what order would you prefer potential new revenue be doled out?
posted by Paul Richardson
Tuesday, Mar 20, 07 @ 9:13 am
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Rich, I think you missed the most important priority of all; That is business growth.
Where in all of these priorities is growing our economy? Where are the big business retention programs? Where are the the big business relocation programs?
I have only seen hostility towards the businesses that are here now and and a message to those who may be considering (read reconsidering) locatng their company in Illinois!!
So my priority for spending in Illinois would be to develop/redevelop our business recruiting program to attract a company to hire 2000 employees. Attract a company that will be generating a $10 million in sales tax, $10 million in payroll 100,000 in property tax!
Don’t punish the ones here generate new business. PLEASE?!
Comment by Larry Mulholland Tuesday, Mar 20, 07 @ 9:35 am
Excuse me, I guess I should be addressing Paul…
Comment by Larry Mulholland Tuesday, Mar 20, 07 @ 9:36 am
Health care, mass transit, property tax relief……don’t have specific ranking for the rest. Pensions have to be addressed but by capping the entitlement in some way. Education is vital but throwing money at the problem won’t fix it.
Comment by Way Northsider Tuesday, Mar 20, 07 @ 9:38 am
:)
Do we need new revenue for the business retention program?
Comment by Paul Richardson Tuesday, Mar 20, 07 @ 9:40 am
Larry -
How much corporate income tax will your company pay? If it is paying $0 in corporate income tax, I don’t want anything to do with it.
A company that pays $0 in corporate income tax is not one we want or need in Illinois.
Comment by Killroy Tuesday, Mar 20, 07 @ 9:40 am
1. Education
2. Prop. tax relief
3. Pension debt (The high interest is killing everything else)
4. CApital projects
5. Health Care
6. Mass Transit
Comment by rank Tuesday, Mar 20, 07 @ 10:00 am
uh Mr. Killroy please remove your head from where it is and let the light shine bright! Your comment confirm for me that you arte really heading up Blago’s business growth programs…VERWEEE SCARWEEE!
Simply because a company may not be paying (legally) corporate income tax does not by any means that the state it’s overtaxed people are is recieving no revenues.
Payroll tax, income tax for employees, property tax, sales tax, taxes on utilities, gasoline tax & even license fees just a name a few… oh and lets us not forget the money paid to vendors throught the land that pay the above taxes.
Comment by Larry Mulholland Tuesday, Mar 20, 07 @ 10:03 am
Rankings
Business growth programs
Education
Pension Debt
property tax relief
Rainy Day Fund
Capitol projects
Mass transit
Comment by Larry Mulholland Tuesday, Mar 20, 07 @ 10:06 am
Left off couple other big ones: Unfunded mandates and CODB (cost of doing business) increases for community based social service organizations.
1. Education
2. Prop. tax relief
3. Pension debt (The high interest is killing everything else)
4. CODB adjustments
5. Rainy Day fund
6. Unfunded mandates
7. Capital projects
8. Health Care
9. Mass Transit
Comment by zatoichi Tuesday, Mar 20, 07 @ 10:31 am
1. Mass transit - If the Chicago area cannot effectively move people to there jobs, the economic engine of our state will stall and the rest of the budget will collapse.
2. Pensions - Our budget will drown if this is not dealt with (and Blago’s credit card balance swap approach is NOT a solution).
3. Education - Every kid should have the opportunity to receive a quality education.
4. Property tax relief - Key to any tax increase proposal.
5. Health care - Not a crisis like mass transit or pensions.
6. Capital projects - Like we need more pork.
Comment by Bluefish Tuesday, Mar 20, 07 @ 10:47 am
Rank
1 - pay off old debt (mostly pensions)
2 - decrease spending and reduce taxes
The governments (state and federal) already screw up almost everything they get their hands on (the main exception being the writing of checks; they’ve become proficient at that!). And almost everyone in the US has enough of everything - the federal poverty level for a family of 2 is over $13k, way more than the average income in China (even adjusted for buying-power differences). Any increased spending should be limited to local governments, who have at least have some idea what they are doing and some oversight. Ain’t gonna happen, but it should…
Comment by Mr Wizard Tuesday, Mar 20, 07 @ 11:03 am
1. Pensions (in my household, debts are paid before anything else)
2. Mass transit (including some kind of vanpool system for folks in less populated areas)
3. Healthcare, I would include basic dental care here. The 8 year old boy that died of an infected tooth is a tragedy that shouldn’t happen.
4. Capitol projects (these alone can attract business)
5. Education, but only if the Charter caps can be lifted.
Because property taxes are local taxes, I don’t see where it’s any of the business of the state to raise or lower them.
Comment by cermak_rd Tuesday, Mar 20, 07 @ 11:14 am
Education: We might be spending enough on education, as is. There’s no way to know. But, as the Trib editorialized, “we’re not getting enough for the dollars we spend.”
That said, education reform - like it or not - is going to have to be bought. The only to get more money for charter schools, for mentoring programs, for reduced class size or for vouchers (!) is by spending more altogether. Defunding the failing status quo, sadly, politically, is not an option.
But reform is desperately needed, and it’s going to come at a cost.
As for Everything Else, we don’t need more money, we need spending reform.
The state is going to have to change it’s pension benefits. GASB45 is going to bear this out. New revenues in future years will be sufficient to fund the current debt, if we flat fund everything else. FY2008 Cost: $0
Property tax relief: a revenue neutral tax swap - coupled with a mandated tax and expenditure limit on municipalities - would take care of that problem. Cost: $0
Rainy Day Fund: Current state spending is the reason why a ‘Rainy Day’ looms. Cut state spending to the point that we can talk about cutting taxes. Rainy Day Funds are born out of budget surpluses. FY2008 Cost: $0
Capital Projects: The state needs a modest Capital Plan, at most. Eliminate member initiatives (earmarks), publicly debate what to do with those funds, and I guarantee that all of the ‘essential’ capital projects will find money.
Mass transit: We probably spend enough. We could probably spend differently. Privatizing a number of services, then using the revenues to fund infrastructure improvements and a means-tested rider subsidy would probably do the trick. If that’s not enough money, see below.
Business growth programs (introduced by Larry Mulholland as a priority), get no new state funds. They get less. Use the funds instead for mass transit (above) or Health Care (below).
Health Care: the health care market is fragile enough. Having the state - and especially the State of Illinois - further enter the market is letting a bull into a china shop. Fostering an increased public dependency on welfare programs is bad policy. Forcing health care providers to further depend on the fiscal health of state government is worse. Stop expanding Health Care programs. Start making them more effecient. Shift our focus from universal care to caring for the working poor. Doing so will save money and improve coverage in the long run. If it costs money in the short run, see “business growth programs” (above).
Comment by Collin Hitt Tuesday, Mar 20, 07 @ 11:16 am
Kilroy-
Although a corporation may not pay a state corporate income tax, it still pays property taxes and provides jobs to folks around the state. Isn’t that of some value? I have no problem looking at reforming the corporate income tax code, but your claim is just plain irresponsible. Like it or not, this state needs and should actively compete to house businesses. The “let’s hang business out to dry” mentality is dangerous and extremely short-sighted. These businesses are our state’s life blood.
Comment by Drew Tuesday, Mar 20, 07 @ 11:20 am
Pension- the pension system needs to be full fund and reformed because in the long run this will save the state money so its tops
Capital project- a good capital infrastructure helps to attract and retain business
Education- the state needs a quality educational system
Health care- no expansion of the existing health care system, but existing programs should be reformed
Mass transit- there may be the need for some more funds for Chicago, but by and large I dont think that there is need for the rest of the state.
Comment by RMW Stanford Tuesday, Mar 20, 07 @ 11:25 am
Drew, I don’t understand why it’s OK with you that a giant corporation like Tribune Co. can pay one tax but not another.
Comment by Rich Miller Tuesday, Mar 20, 07 @ 11:27 am
“A company that pays $0 in corporate income tax is not one we want or need in Illinois.”
Even if a company doesnt pay corporate income tax it is still a benefit to the state, they still pay property taxes and they produce new jobs which means higher economic growth, more people working and fewer people on state aid and more people paying the state income tax and paying more in income tax.
Comment by RMW Stanford Tuesday, Mar 20, 07 @ 11:34 am
This is easy.
You enhance your money flow by investing in infrastructure. Then you lower taxes, which has been shown to stimulate the economy and thus return the tax cuts made.
Then you pay off debt that has interest rates beyond what is reasonable. So the pension gets shored up.
You reform education. Right now it takes, but doesn’t deliver. No more money until real changes are made.
Mass transit is a small investment. We need it and it needs to be really good to get used so it must be well maintained.
Finally, health care. I know this is a “feel good” issue important to many. However in the real world, we don’t take money from you in order to waste it. Spending money on health care is a one-way bottomless pit. It divorces reality from the market and causes prices to escalate, which means even higher costs. When health care is free, no one will be able to afford it. That is reality - not political reality - just real world reality.
After four years of fiscal crisis, we need to set priorities right. We need to encourage businesses to locate and grow here, not tax them. We need to reform education, not throw more money at it. We need to find a way to fix health care costs or cut them, not find new ways to waste tax money on it.
Blagojevich does good political work. But his approach to government is suicidal and just as Curry said this weekend, “it will take decades to recover” if his plans go through.
We don’t have decades, we are in competition with 49 other states who 40 appear hungrier and smarter than we are and taking business from us.
Comment by VanillaMan Tuesday, Mar 20, 07 @ 11:36 am
Finally, stop taxing families. We will grow if we stop treating families like piggy banks. A 33% income tax cut for each child would be a start.
Comment by VanillaMan Tuesday, Mar 20, 07 @ 11:39 am
VM,
Unless there’s some way to “force” the children to stay in the state of IL, I see no benefit to reducing taxes based on the number of children. Such a proposal would only cause family-size warfare. If you’re not a fan of class warfare, I don’t see why you want to cause that.
Comment by cermak_rd Tuesday, Mar 20, 07 @ 12:00 pm
#1 Transit - Biggest issue here. Productivity is reduced from the stress caused spending 80 mins one way (Chicago average) in traffic, not to mention the time wasted. This affects health, because people are too tired to excercise or eat healthy. Also affects education, because schools only teach so much, parents fill in, unless of course, they are too tired from wasting time in traffic. Affects the economy most of all because the cost of fuel and tolls severely limits the expendable annual income of households (not to mention productivity at work). Heavy traffic also affect the infrastructure of the city, which is in constant repair and therefore needs constant increase in property taxes to subsidize it.
Institute the downtown entry tax (just add $ 5 to the already outrageous parking fees). Create HOV lanes to encourage carpooling, spend alot of money to not only repair, restore and update the CTA, but actually clean it up so the Red & Blue lines do not smell of urine. City stickers for personal vehicles over a certain weight limit (aka SUV’s) should be doubled to make up for the wear and tear they cause the city streets.
If Natarus pushed for this instead of, oh I don’t know, fining people for driving with cell phones, he might still be alderman!
Comment by mooike Tuesday, Mar 20, 07 @ 12:03 pm
Tax cuts to promote business growth
Property tax reform
Pension funding reform
Education
Health care reform
Comment by The Conservative Tuesday, Mar 20, 07 @ 12:43 pm
1. Pay our current obligations to creditors (Medicaid; health care providers, nursing homes). Having a month-to-month carryover of $2 billion in late bills is not acceptable.
2. Mass transit - Our biggest goal needs to be to keep people productively employed. Therefore, mass transit is a must, and not just in the existing service areas. We need to expand our service areas to locations like Kendall, Grundy, DeKalb, Boone, Kankakee, and LaSalle Counties. We need to place secondary hubs in places like both Elgin/Dundee and the Joliet area. Got to be able to effectively move the people.
3. Pensions - We have to get a whole lot closer on funding our obligations, and then reform at the same time to take into account the GASB45 obligations.
4. Education - Minimal new money, anything we do will just be swallowed up with demands for more.
5. Property tax relief - Do nothing.
6. Health care - When you’ve got $2 billion in unpaid past due bills sitting there waiting to get paid, forget doing anything new or expanding existing programs.
7. Capital projects - “Like we need more pork” - AMEN!
Comment by Judgement Day Is On The Way Tuesday, Mar 20, 07 @ 12:57 pm
A pro-family agenda would stop penalizing parents who have children by focusing tax breaks on children. We need to allow our families the freedom to parent and raise our next generations. Everytime we tax them, we deny their children money best spent at home.
It isn’t class warfare, it is being pro-family.
By making Illinois a family friendly state, we will grow in population. It will force a reordering of priorities. We will experience the economic boom you see in growing states, not the death spiral we are witnessing in blue states and Illinois. We will gain political strength, and will become a haven for companies looking for fresh labor.
Class warfare? That would only happen if those who depend on others to have children refuse to support those who create tomorrow’s world.
Comment by VanillaMan Tuesday, Mar 20, 07 @ 3:06 pm
VanillaMan,
I only referred to class warfare as an analogy. The warfare I mentioned was family-size warfare. Why should a decent single person have to pay more taxes than their co-worker who has 3 children when they are doing the same job and earning the same salary? Some of the most successful cities are doing it largely without children like San Francisco, so it would seem that children aren’t really necessary to economic growth.
Like I said, unless you can find some way to “force” the children to stay in IL for a period of their earning years, I see no benefit to tax cuts based on family size.
Comment by cermak_rd Tuesday, Mar 20, 07 @ 3:36 pm
1. Swap of increase in income tax for reduction to property taxes
2. Captial Improvements
3. Mass Transit
4. Pension Debt Obligations
5. Education
6. Health Care
Comment by Niles Township Tuesday, Mar 20, 07 @ 3:50 pm
as usual, community based human services aren’t even on the list. Just as the Walter Reed scandal was really a crisis caused by the federal appropriations process, the perilous state of most community based human services agencies serving State referred wards and clients is causing our own Walter Reed situation — but no one seems to notice or care. The total collapse of the reliance on community based services for State human services is surprisingly close. Larger program areas have not had a rate increase in 5 - 8 years. When that collapse happens, don’t be surprised. The providers have been pleading for years, to no avail.
Don’t believe me? Five years ago, there were 100 adult day care centers. Today, less than 75. 25 years ago, there were almost 50 youth group homes - today only 25 or 26. The list goes on and on.
What is the primary mission of DHS? To get adults ready and able to work, to become economically self sufficient. But the job training and placement agencies have been starved for COLAs for eight or more years! Does this make any sense at all? (Only to GOMB/BOB bean counters…)
Comment by capitol view Tuesday, Mar 20, 07 @ 4:00 pm
“Why should a decent single person have to pay more taxes than their co-worker who has 3 children when they are doing the same job and earning the same salary? Some of the most successful cities are doing it largely without children like San Francisco, so it would seem that children aren’t really necessary to economic growth.”
Honestly, if you believe this, I couldn’t possibly begin to help you understand. That would be for another blog.
Your question does not recognize hundreds of years of governance and tax laws, and your example successful city is frightenly disfunctional. If you see differently, there is nothing anyone could quickly say to steer you in the right direction.
Sorry.
Comment by VanillaMan Tuesday, Mar 20, 07 @ 4:58 pm
…Cermack Rd..that when you state: “Because property taxes are local taxes, I don’t see where it’s any of the business of the state to raise or lower them.” that the state raises your property tax every year by the multiplier that they establish for each township in the state. In some cases this multipler can add hundreds of dollars per year to your property tax bill every year.
Comment by Iwonder Tuesday, Mar 20, 07 @ 6:11 pm
1. Health Care
2. Property Tax Relief
3. Mass Transit
As for education–a complete transformation of the educational system needs to occur before any more money is thrown at it. Money will not solve the problems of the school system. The more they get, the more they want with little or no results.
Comment by Just a Citizen Tuesday, Mar 20, 07 @ 6:53 pm
Of all those health care would not even be on my radar. I would instead emphasize working with insurance companies and hospitals to work on this issue of health care. I would top my list with property tax relief, education, and capital projects.
Comment by Levois Tuesday, Mar 20, 07 @ 7:41 pm
#1. Pensions are the only constitutionally protected item that is a “must” on the list, even though I’m not too crazy about the subject. Short of a Con-Con that takes away the rights of existing pensioners, teachers and state and unbiversity employees, this is a bill that will either have to be paid now, or later. Later will cost much more. Thank goodness for the ability to vote with one’s feet if the situation warrants it.
Everything else is #2.
When we talk about Education, structural reforms are needed that will make use of the dollars that are already spent. Too many administration and extraneous expenses vs. classroom expenses, golden parachutes and six figure incomes don’t sit well with taxpayers. Then we can talk about what “extra” is needed.
Health Care should be there for those who need it, but should not be paid for by taxpayers to relieve the burden from low-wage employers.
Mass Transit makes sense in densely populated areas, but I have visions of Pace buses with 1 rider, Metra extensions costing millions of dollars where 20 people board the train, and a CTA where it seems like the money goes down a rathole each year and more and more is needed.
Capital Projects are needed, but I do not trust the money to go to need rather than to clout. There needs to be a fair distibution system, not a spoils system, if more infrastructure expenditures are required.
Property Tax Relief can only be accomplished by a concurrent raise in a replacement tax - a raise in the state income tax would be the likely candidate. As much as it pains me to say it, high property taxes are one of the only controls on wasteful spending out there. When people get their property tax bill, it provokes enough emotion to get involved. A slight raise in the state income tax, taken as a small increase in withholding on everyone’s paycheck, wouldn’t provoke nearly the same reaction.
Comment by Six Degrees of Separation Tuesday, Mar 20, 07 @ 9:33 pm