A new report on state budgeting has prompted fresh debate about how tax dollars are spent north and south of Interstate 80 in Illinois.
A Paul Simon Institute for Public Policy at Southern Illinois University at Carbondale study found that most people in Illinois, no matter what part of the state they live in, don’t feel like they’re getting a fair share of the state’s tax revenue. Furthermore, it found Chicago and the suburban counties in northern Illinois got back less money from the state than they sent to Springfield in taxes while counties in southern Illinois tended to get more money from the state than they contributed.
The institute’s report found 19 of Illinois’ southernmost counties received $2.81 in state spending for every dollar they sent to the state. Results were similar in other parts of Illinois, except in the Chicago area, where Cook County received 90 cents on the dollar and the five collar counties got 53 cents for every dollar they paid the state.
“The suburban counties generate about twice as much in taxes as they receive in direct state spending,” according to the report. “Downstate Illinois, on the other hand, benefits from the state tax and spend mix. The 96 downstate counties, as a group, receive about 50 percent more in state spending than they contribute in tax revenue.
“These findings may help explain … why there is significant rural resentment and some urban resentment in Illinois politics, but less suburban resentment,” the author’s of the institute report wrote. “In the context of the broader economy, the regions which are doing least well, show the highest resentment levels while the better offs show the lowest. But blaming state government for the perceived inequities is somewhat mistaken.”
The majority of the report’s data came from a 2015 Legislative Research Unit analysis of Illinois’ fiscal 2013 spending.
The LRU authors warned that their report had limitations that they said “cannot support defensible conclusions about any one county’s ‘return’ on state tax collections.” However, the state researchers said the analysis “shows a regional redistribution of revenues from the urban and suburban counties of northeastern Illinois to the southern and western parts of the state.”
The LRU report urged caution in interpreting the results. The authors noted it was a snapshot of the bulk of a single year’s spending and revenue that didn’t include spending for things like capital projects, transportation and some Medicaid disbursements. Including those sources wouldn’t have allowed the state researchers to compare spending by county. In total, the state researchers measured 80 percent of revenue and 71 percent of spending from one state budget.
Shelbyville state Rep. Brad Halbrook was a chief co-sponsor of a resolution urging Congress to recognize Chicago as the 51st state. He doesn’t dispute any of the report’s findings on state spending but said that it only tells half of the story in terms of regional antipathy for the power that Chicago politicians wield over the rest of Illinois.
“We continually see unfunded mandate after unfunded mandate,” he said. “Whether it’s on schools, local governments, or even individuals, we continue to see regulation that drives costs up.”
Illinois lawmakers often write laws that exclude or pertain to only Chicago by saying they’re only applicable or don’t apply to counties or municipalities with a population of more than two or three million people. Reasons for these exceptions vary and can be logical, but Halbrook said the laws tend to give Chicago more autonomy, send specific funds or services, or require things from other towns that are not required from the state’s largest city.
“Some of this legislation is for everybody but Chicago or Cook County,” he said. “They exempt themselves out and I think it’s really improper to do that.”
Halbrook listed off the more than $200 million in state funds devoted to Chicago Public Schools’ teacher retirement fund, prevailing wage laws that increase costs on local projects, and a potential $40,000 minimum salary for teachers by 2022 that would disproportionately affect schools outside of Chicago area.
“That would be a huge burden on our downstate districts where it’s not so much of an issue in the northern part of the state,” Halbrook said.
Jackson said those mandates and orders are small when compared to the amount the state spends on the regions, typically for higher education. Plus, it takes more than just Chicago lawmakers to pass state mandates. Many urban areas have legislators who often vote with Chicago on issues that Halbrook criticized.
“The other metropolitan regions, their representatives may well vote with Chicago on things like that,” Jackson said.
Nine of the state’s 12 universities, the lion’s share of community colleges and prisons, Jackson said, are outside of Chicago and the collar counties. This likely accounts for much of the money spent on the regions, along with capital improvements since there are more linear miles of state-maintained roads outside of the suburbs.
The LRU report noted the inherent flaws in devoting state spending on an institution like Illinois State University as exclusively beneficial for central Illinois, as many students from the collar counties and elsewhere.
“…Universities, community colleges, mental health institutions, and prisons spend state money in single counties but provide for needs regionally or even statewide.”
