CapitolFax.com - Latest Comments in Time for a rethink?

Re: Time for a rethink?

Truthful James — Fri, 27 Mar 2009 17:46:51 -0000

wordslinger -- Not shell game within a shell game. There are three types of capital projects: new projects, improvements and extensions, repairs and replacements. Each needs to be accounted for separately.

The new projects need to be identified in a Capital Project program. Unless emergencies intervene they should be part of a five year program set at a certain level per year and funded by State of Illinois Bonds. The Program will be updated annually and extended out one year each time by the executive and approved by the legislature. This is the ideal area to be funded by property tax supported General Obligation Bonds.

It is hard to judge the total property valuations in the State on a current basis. The last published totals were for 2006 and were above $331 billion. A millage rate of ten cents per $100 EAV would support a 450 Million 5 year Bond issue at a cost of $50 per 150K house. On a 29 year basis at the same rate that millage would support a $4 Billion plus bond issue.

$50 bucks a year I refuse to describe a "only $50" but a governor might be able to sell that easier than a 50% increase in the income tax rate.

Now we come to the second and third categories, improvements and extensions, repairs and replacements. One again a program needs to be written for a rolling five year period and funding needs -- again in the absence of an emergency -- to be assigned (prioritized). Here is where the motor tax should be sequestered and applied.. To a great extent it can be allocated based on the the counties from which it was collected, but modified to a certain extent based a formula for miles of state roads, for instance.

Doing it this way the State can achieve transparency and a measure of equity., something perhaps that the taxpayers may more greatly desire than the legislators themselves.

Re: Time for a rethink?

curly — Fri, 27 Mar 2009 17:07:26 -0000

"not one more nickel"

chirp, chirp, chirp

Re: Time for a rethink?

Ghost — Fri, 27 Mar 2009 16:59:05 -0000

disgusted, why must an agency be self sufficient from fees or be cut? Of course your position technically feeds back on itself. All governemtn agencies are alreayd self sufficient by use of fees, one of these fees is taxes.

So you want the police to be given motiviation to tak in money... how much should they charge you to process evdience from the brugarly at your home? How much should you have to pay for them to look for your stolen car? How about the fee you should pay every time they arrest a criminal, or drug dealer etc.

Do you really want every state agency sending you a bill or fee charge for the services they provide?

Re: Time for a rethink?

disgusted — Fri, 27 Mar 2009 15:40:43 -0000

Budgets are supposed to be designed from the ground up. Each and every State agency should have to justify its existence and service...and move towards self sufficiency through fees and /or donations and grants, etc or cut expenses accordingly. Axe unneeded services. I went through a highway toll in a very low traffic area with a quarter charge...what? just close the toll place down or charge what you need to to at least pay to keep the lights on and pay the people employed....with some left over to pay for the road. And if people wont pay the toll, then get rid of the toll booth. After sitting on budget committees for both D and R parties, agency directors and university presidents always talk about expenses but never about the revenue side or what they have considered in terms of generating revenues. For example all these white collar crime folks including impeached governors ....who are going to be writing books and doing talk shows....how about they PAY for their estimated $40-50,000 a year stay at Illinois finest (& preferably the Joliet) prison. Farmers pay no Illinois sales tax---well if that is too much to tackle, at least charge a State of Illinois infrastructure fee all each of their grain trucks annually or something to recoup the damage the rest of the citizens pay for in road damage and clean up of chemical spills etc etc. Pension contracts are contracts, whether we agree or they were poorly structured, they are still contracts...drastically change what we negotiate going forward and the pension contributions will become manageable...but this is money we legally owe. Bonding to get out of it...bad money after bad money, we have to pay or buy out current pensions and move on.
Simple and uncomplicated is truly what we need....agreed Quinn is not executing reforms, just drudging up old fixes that no one wants or can understand.

Re: Time for a rethink?

Ghost — Fri, 27 Mar 2009 14:57:14 -0000

Fan === I agree, but we also need to rethink what we want government to do. Do we want government to be as big as it is? ===

I would agree. Instead of just tossing out we need cuts, we would be better served by actually saying, Governemtn does X, I do not think we should have or need goverenment to do x so lets eliminate it. We need to move away from the sterotypicial generalization of government is too big so it just needs to find wasy to reduce itself. lets look for what we dont want, and discuss whetehr that is a real cut. With that discussions we need to recognize that we need to pay the actual costs.

Ill start, lets get rid of CMS.

Re: Time for a rethink?

Six Degrees of Separation — Fri, 27 Mar 2009 14:46:42 -0000

We call that a state wide property tax used to pay tax exempt bonds issued for those specific purposes (against Federal and State law to divert.) Free up the current receipts from income and sales taxes for current operating expenses.

Instead of creating a shell game to cover another shell game, why not end the diversions of the road fund (which could fully fund a good-sized transportation capital plan including roads and transit) and use property and sales tax revenue to cover the holes in the general fund and to fund school and building capital projects. Keep the apples with the apples and the oranges with the oranges.

Re: Time for a rethink?

Rambler — Fri, 27 Mar 2009 14:42:02 -0000

OK, the personal income tax raised $10.32 billion in FY 2008, so assuming no change in the exemption the increase to 4.5% would raise an additional $5.16 billion.
With regard to the shortfall due to the change in the exemption, I'm still not sure how it can be higher than $4000 (the difference due to the change) times 4.5% times the number of residents, as I calculated previously.

Re: Time for a rethink?

Secret Square — Fri, 27 Mar 2009 14:23:18 -0000

Ok Rich, thanks. If someone like me who tends to be more aware of the inner workings of state government than the average bear failed to grasp the connection there, chances are the average citizen doesn't get it either.

Re: Time for a rethink?

Rich Miller — Fri, 27 Mar 2009 14:17:06 -0000

Rambler, rather than using population, check the annual state receipts for personal income taxes and divide by three (for each percentage point). Then use that number to calculate the approximate ballpark revenue from a 1.5 point increase.

Re: Time for a rethink?

Rich Miller — Fri, 27 Mar 2009 14:14:41 -0000

===what is the purpose of passing massive â€œcapital billsâ€===

Because the federal government does transportation bills every so many years, which require state and local matches. Because we've drained the Road Fund and because we otherwise don't have the cash on hand, it requires a massive bill.

Re: Time for a rethink?

Rambler — Fri, 27 Mar 2009 14:12:08 -0000

Rich,
In your syndicated column you may have miscalculated the revenue shortfall associated with the expansion of the exemption. You said,
"Quinn's tax exemption reform proposal took a tax hike that could've raised almost $6 billion down to only about $2.5 billion."
It seems like the shortfall should be
$4000 times 0.045 times the number of people, about 12.9 million, which equals $2.3 billion per year instead of 6 - 2.5 = $3.5 billion.
You may have done the calculation assuming no exemption instead of the current $2000 exemption, resulting in a number that's 50% too high.
Even so -- if that's correct -- it's still a substantial amount.

Re: Time for a rethink?

Secret Square — Fri, 27 Mar 2009 14:11:59 -0000

This may sound like an incredibly naive and obvious question, but what is the purpose of passing massive "capital bills" that require extraordinary funding sources every few years for dozens of construction projects, instead of just budgeting for a few construction projects every year? Where is it written that all infrastructure projects have to be done at the same time?

Re: Time for a rethink?

VanillaMan — Fri, 27 Mar 2009 13:25:21 -0000

Sorry. I disagree.
As voters, we depended upon two political parties to provide us with our choices for elected offices. In many parts of Illinois, there is only one choice on the ballot.

It is wrong to blame our elected officials for the decisions they made in our name, but it is OK to blame everyone? Nah, it doesn't work that way.

The Illinois Democratic Party has had near total control over Illinois for a decade. (Or, am I missing some GOP statewide office holders?) After a decade, they still couldn't come to a consensus other than raising our taxes, or playing budget games with our balanced budget requirement? What did they think would happen? How long did they think they could play these games? Gee, everyone knew this was going to end. I remember hearing President Jones clearly stating his belief that Illinois didn't have a spending problem - it has a revenue problem. That was a few years ago.

One of the things we discovered about the Illinois Democratic Party through it's impeached governor, Rod Blagojevich, was that even with a gubernatorial cap on income tax increases and solid majorities in both houses, the Party had no interest in budgetary discression. They fingerpointed as the cost of living could somehow justified their expensive government expansions and budgetary destruction.

We are not to blame for this. Promises were made to gain votes to secure an even stronger majority for the Illinois Democratic Party in both houses, but the only thing they delivered were unpaid bills, exhausted credit ratings, and now tax increases. Voters never approved of these things.

Blame is not to be spread around, or in the end, nothing is learned and we repeat the mistakes.

Re: Time for a rethink?

dupage dan — Fri, 27 Mar 2009 12:37:33 -0000

VM,

Someone may beat me to it but I'll say it anyway. Of course, we are the ones who caused this mess. We elected these people. Someone will then say, "I didn't vote for RodB". While that may be true (it certainly is in my case), it doesn't matter. These are our elected representatives. If they don't do the right job it is our responsibility to work to get them voted out of office. I am not so naive to think that is easy but it is the system we have.

As far as having those who caused this problem pay for this, how will that work? Are you suggesting we garnishee their wages? Confiscate their assets? Put 'em to work on a chain gang? Can we realistically solve this horrific mess by "making them all pay"? They can be removed from office by their constituents and replaced but that won't put a dime into the general fund.

Re: Time for a rethink?

Rich Miller — Fri, 27 Mar 2009 12:24:55 -0000

===We are not the ones who caused this mess, and as good citizens, are demanding those who did nothing while our state budget collapse, to pay the price - not us.===

What?

The citizenry has elected every one of our legislators and governors for a very long time now. These people just didn't descend from Mars.

Therefore, to extend your logic, they should pay the price.

Re: Time for a rethink?

dupage dan — Fri, 27 Mar 2009 12:24:25 -0000

YDD Oh, I didn't realize it was an english lesson. Sorry, but I thought we were discussing taxes, not semantics. Besides, Levois was asking about the math, not the english.

Re: Time for a rethink?

VanillaMan — Fri, 27 Mar 2009 12:22:13 -0000

YDD - I am not a straw man for you to use to make those of us who want better government to appear foolish.

We are not the ones who caused this mess, and as good citizens, are demanding those who did nothing while our state budget collapse, to pay the price - not us.

Re: Time for a rethink?

wordslinger — Fri, 27 Mar 2009 12:17:38 -0000

--We call that a state wide property tax..--

TJ, not judging the merits of your proposal, but I think the name of your revenue source needs a little work. The Red-Hot Poker Where The Moon Don't Shine Tax might be a bit more politically palatable in this state.

Re: Time for a rethink?

Truthful James — Fri, 27 Mar 2009 12:09:34 -0000

The governor may be on the right track but on the wrong train.

To pay for an emergency (created by his own party's six year misrule he wants a permanent increase in a tax rate plus many, many, many fee increases (a tax by any other name...)

Let's do real capital planning on a five year basis, not a game of musical earmarks hidden by the use of current revenue sources. A five year Capital Improvement Program, updated and extended annually, funded by a specific tax levied for that purpose and no other. We call that a state wide property tax used to pay tax exempt bonds issued for those specific purposes (against Federal and State law to divert.) Free up the current receipts from income and sales taxes for current operating expenses.

Politicians slaver over the thought of an increase on the books without an expiration date in any tax rate. After we solve an emergency, it is the gift from the taxpayers that keeps on giving, It is the reelection crutch they all want and need.

Re: Time for a rethink?

Rarely Posts — Fri, 27 Mar 2009 12:05:50 -0000

The statement that Illinois' rate is "just 3 percent" is correct but misleading. Illinois taxes federal gross income, while almost every other state's tax is on federal TAXABLE income. The main difference is that Illinois does not give you the benefit of any federal deductions such as charitable deductions, mortgage interest, sales taxes, or the federal standard deduction. So comparing Illinois' tax rate of 3% to other states' rates, when they tax on a much lower base, is a misleading comparison.

Re: Time for a rethink?

wordslinger — Fri, 27 Mar 2009 12:05:22 -0000

YDD, grammatically speaking, no.

The proposal is a 50% income tax rate increase from 3% to 4.5%, or a 1.5 percentage point (not percent) income tax rate increase from 3% to 4.5%.

Re: Time for a rethink?

Yellow Dog Democrat — Fri, 27 Mar 2009 12:00:04 -0000

=== The current state income tax rate is 3% of gross income. If you raise that by 50% the tax rate will then be 4.5%. That is an increase of 1.5%. That is half again what 3% is. In other words, a 50% tax increase. Get it? ===

Dan -

Grammatically speaking, it's either "a 50% increase in the income tax rate" or "a 1.5% income tax increase."

The percentage is an adjective, which modifies the following noun.

Its correct to use "50%" to describe the RATE increase, but the absolute value of the increase is only 1.5%.

Make sense?

Re: Time for a rethink?

VanillaMan — Fri, 27 Mar 2009 11:53:08 -0000

Look at the bright side!
We have only one party in power. The other party is hardly a factor. SO, all the Democrats have to do is - something! That is, show us that they are sincere before they raise our taxes. Why is this so hard for them to do?

Yeah, it means they will have to step on some of their constituent's toes, and they would rather stomp on our toes because we haven't stomped back at them. We are good people! We have a lot of patience. We've been sitting around patiently for a decade, watching this Soap Opera of National Embarrassment and being laughed at in at least 51 different languages.

Time is up! Sorry the economy has imploded while you people dithered! You had ten long years to give us hope before it has come to this, and nothing has happened folks!

A government that cannot govern has no reason to believe that it's citizens will happily cough up more of their wages during a recession when they are tightening their belts.

That is also a fact, Jack!

We understand why the Democrats are spinning crazily for a tax increase. On the other hand, why can't the Democrats understand that we are fed up and even if we weren't economically melting down, we would want their heads? The Democrats are delusional in thinking that our anger towards Springfield is simply a matter of 1.5% income tax increase.

It is watching a capitol full of failures telling us to trust them when they say they really need more of our money at a time when we have lost thousands in our future income.

It isn't just the math, it is the damn attitude!

Re: Time for a rethink?

Yellow Dog Democrat — Fri, 27 Mar 2009 11:52:11 -0000

=== VanillaMan is right - not one more nickel until they can prove they know how to spend it. ===

Fine, but let's apply that logic to EVERYTHING:

- Let's eliminate the $1.7 BILLION in corporate tax breaks Illinois currently hands out until these companies can PROVE to us that there's a reciprocal public benefit.

- Let's eliminate the $2.4 BILLION the governor proposes spending at the Department at Commerce and Economic Opportunity for the same reason.

- Let's eliminate the more than $1 BILLION we currently spend at the Department of Corrections, since doubling the number of people we incarcerate since 1975 and lengthening sentences clearly hasn't made us any safer.

If we take these steps, we can avoid a tax increase AND ensure our state pensions are fully funded.

Come on Republicans! Who's with me?!?

Re: Time for a rethink?

Madison County Watcher — Fri, 27 Mar 2009 11:50:43 -0000

I remember just 10 years ago, when the General Assembly was fighting about whether $1 billion was too much money to put into a "rainy day" fund. I think GRyan wanted the money for Illinois First, and everyone was squabbling over the gift of a balanced budget that Edgar had left the state.

George and Rod might have been personally corrupt, but the General Assembly went along with the 10 or 11 budgets that have since left our state in this condition.

VanillaMan is right, and maybe it's time for the constituencies that back those that have governed us into this mess to start sacrificing, as well.

Instead, the state will now just raise the taxes on the constituencies that didn't put us into this mess. What a sad truth, and it doesn't put us any closer to solving the structural problems the state is facing.