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Cook County Commissioners Float Budget Designed to Avoid Sales, Lease Tax Increases

Wednesday, November 26, 2003
Daily Tax Report

Chicago – Frustrated with a budget proposal calling for an increase in Cook County, Ill’s sales tax and the creation of a new lease tax, five county commissioners Nov. 24 unveiled a plan to restructure the county’s budget and provide tax payers with $100 million in property tax relief in the process.

The commissioner s called for passage of their Tax Relief and Waste Reduction Act of 2003. The proposal would solve Cook County’s 2004 budget woes by imposing a 2 percent cut in operating expenditures from 2003 levels.

The plan leaves the county with an overall budget of $2.8 billion and funds available for property tax relief. The commissioners contended that Cook County’s budget could be with no impact on services to county residents.

This alternative approach stands in contrast to the $2.99 billion budget proposed Oct. 30 by John Stroger, President of Cook County Board of Commissioners. Stroger’s budget called an increase for an increase in the county’s home rule sales tax from 0.75 percent. The budget proposal also included a new 4 percent personal property lease transaction tax. The two tax plans would generate $55 million in additional revenues for the county , which covers Chicago and several surrounding suburbs.

Surplus in County Coffers, Larry Suffredin, one of the five Cook County commissioners behind the tax relief act called the tax increase under Stroger’s proposal “unnecessary.” He pointed to a surplus of more than $200 million in the county’s coffers and the likelihood pf additional surplus funds if Stroger’s budget is approved.

He also that Stroger’s Budget plan assumes full funding for 1,000 jobs that are vacant and will not likely be filled during 2004. IN this climate, he said new taxes would harm taxpayers and undermine the goasl of efficient and effective government.

“I want to protect Cook County taxpayers from needless tax increases,” Suffredin said in his statement. “ The effort to cut the proposed budget without jeopardizing jobs or services is possible because of all the extra money that is hidden in the proposal budget. This hidden money is never intended to be spent. Truth in budgeting will allow all citizens to what county government actually costs and how tax dollars are spent.”

Stroger’s held a briefing with reporters Nov.24 and rejected the criticism of his budget. He insisted that county services would be compromised without the tax increases. In his original budget address, Stroger warned commissioners “ these times that require difficult decisions.”

Commissioners are scheduled to vet on a final budget Dec. 9.

Criticism for Stroger’s Budget, Stroger’s budget has also come under fire from the civic federation, a nonpartisan taxation and fiscal research organization. In a report dated Nov. 19, the Civic Federation expressed its opposition to the proposal because it does nothing to reduce the cost of government and improve efficiencies.

The Civic Federation also opposed the two tax proposals, suggested they were fundamentally unfair when the county had done nothing to control spending. Moreover, the federation argued that the sales and lease taxes – when grouped with Chicago’s sales and lease taxes – would negatively affect businesses in the city.

If implemented, the tax increases would boast Chicago’s overall sales tax rate to 9 percent and its lease tax rate to 10 percent. Finally, the federation noted that Sroger’s tax increases would create an unjustified revenue windfall in two years when fully implemented.

“We are also concerned about projections that the two taxes, when fully in place $150 million per year,” the federation noted. “ What justification is there for those additional revenues? What will they be spent on? In the absence of a long-term planning process, we just don’t know.



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