Feeding the Beast: Illinois Cities Can Borrow More

A new state new rule guaranteeing bondholder payments incentivizes Illinois cities to borrow more money and increase taxes to cover fiscal shortfalls.

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ILLINOIS NEWS NETWORK

By Jacob Bielanski

As Republican governor Bruce Rauner and Democrat leaders in the General Assembly battle over education funding, an Illinois state representative wants to make sure her constituents are aware of some lesser-discussed provisions that were included in budget-related legislation approved last month.

Much of the focus last month was on a $5 billion income tax increase that will force Illinoisans to pay an additional $1,000 to state government each year on average. Rep. Jeanne Ives, who opposed the tax increase, said that wasn’t the only provision approved by lawmakers that is bad for taxpayers, and the state.

The 583-page state budget bill that most legislators were only given 45 minutes or so to read before having to vote on it contains several ‘hidden’ provisions that will cost taxpayers and local communities millions of dollars above and beyond the income tax hike that was passed the same day in a separate bill,” Ives wrote recently on her website.

Among the items Ives references are a two percent collection fee on municipalities, a repeal of a tax exemption on ethanol that will lead to gas price increases and a provision that incentivizes municipal borrowing that could lead to more local tax increases.

Continue reading the story on the Illinois News Network website.