Progress continued during the week when Governor Bruce Rauner signed into law a bipartisan compromise funding bill that helps provide resources for higher education and MAP grants for college students until fall.
In other news, the Illinois Labor Relations Board began a hearing on whether contract negotiations between Governor Rauner and one of the state’s largest labor unions have truly reached an impasse.
Also during the week, a report from data provider CoreLogic ranks Illinois number one in the nation for having the highest median property tax rates. Not surprisingly, the new report coincides with this year’s “Tax Freedom Day,” which falls on April 29.
A step in the right direction
On April 25, Governor Bruce Rauner signed an appropriations bill for higher education and MAP grants. The bipartisan solution ensures that universities, colleges, and community colleges remain open through September, at which point they’ll start collecting their fall tuition money.
Governor Rauner said this legislation doesn’t solve the budget crisis, but is a good step toward compromise. He noted it’s “time to build on the bipartisan momentum” and focus on passing a balanced budget for Fiscal Year 2016 and Fiscal Year 2017.
Senate Bill 2059 contains funding from the Education Assistance Fund: more than $350 million for state universities; more than $74 million for community colleges; more than $169 million for Monetary Award Program (MAP) grants; and $6 million for the Illinois Mathematics and Science Academy. Comptroller Leslie Munger said her office would immediately start processing payments.
As the 11th month without a full budget approaches, many social service programs are still waiting for funding. The Senate passed bipartisan legislation on April 22 that appropriates $441 million from the Commitment to Human Services Fund to help pay for critical human service programs. Senate Bill 2047 is currently pending in the House of Representatives.
Lawmakers return to the Capitol on May 3 to resume legislative action.
Rauner/AFSCME go to Labor Board over union contract negotiations
Having failed to negotiate a compromise agreement with the American Federation of State, County and Municipal Employees (AFSCME), the Governor referred the dispute to the state labor board in January in accordance with law. Now the Illinois Labor Relations Board will decide whether the parties have truly reached an “impasse.”
If the Labor Board determines the parties are unable to reach an agreement, Gov. Rauner could move forward with his last and best offer. Union members could either accept the Governor’s terms or go on strike. However, if the Board decides that the two parties have not yet reached an impasse, negotiations will continue.
Governor Rauner and AFSCME had been negotiating for more than a year before the Governor went to the Labor Board in January. During negotiations, AFSCME, which represents roughly 38,000 state workers, refused several contract offers presented by the Governor. These contracts were similar to ones approved by more than a dozen other union locals.
At the heart of the dispute are changes to worker raises, overtime hours, and health insurance costs. Governor Rauner has said that AFSCME’s contract demands would cost more than $3 billion at a time when the state faces serious fiscal challenges.
The hearing began on April 25 and is expected to last through May before an administrative law judge issues a decision. Additionally, either party can appeal the decision, beginning a process that could add weeks or months to the impasse.
Illinois has highest median property tax rate
Illinois has the highest median property tax rate in the nation, according to CoreLogic, a data provider to financial services and real estate companies. While the national median property tax rate is 1.31 percent, Illinois weighs in at 2.67 percent.
These figures hit home for the people of Illinois. According to CoreLogic, the owner of a home valued at $200,000 will, on average, pay annual total property taxes of $2,620. However, in Illinois, that homeowner would pay $5,340.
The state’s high property taxes pose a tremendous financial burden for Illinois families and job creators, and play a significant role in the state’s high out-migration of both residents and businesses. Senate GOP lawmakers introduced legislation to provide property tax relief for hardworking Illinois families and businesses, while giving local governments the tools to reduce their costs. That measure has not been allowed to advance for consideration by the Senate.
CoreLogic’s calculations include all taxing entities, which can include property taxes paid to a number of different entities, including counties, villages and school districts. New York has the second highest median property tax rate at 2.53 percent. Hawaii has the lowest median property tax rate at .31 percent.
One hundred nineteen days to ‘Tax Freedom Day’
The Washington, D.C.-based Tax Foundation adds up all federal, state and local taxes and then divides the number by the national income. The date when people earn enough collectively to pay off their yearly tax burdens has become known as “Tax Freedom Day.”
“Tax Freedom Day” in Illinois falls on April 29 this year, meaning Illinois residents worked 119 days to pay off their total tax bill in 2016. The longer it takes the pay their taxes means the less money taxpayers are taking home for food, clothing, housing and other necessities.
Tax Freedom Day underscores the need for change – spending cuts coupled with systemic, structural reforms to reduce rampant abuse, fraud and waste. The longer it takes to implement these changes in Illinois, the more businesses will continue to leave the state and the less money Illinoisans will have in their pockets. Our Tax Freedom Day will keep getting later and later.