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Budget face-off tests Stroger's grip
Tax hike gives board insurgents ammo

Monday, November 03, 2003
Crain's Chicago Business

Is John Stroger still the boss of Cook County government?

That's the question in the wake of Mr. Stroger's risky decision to press for higher taxes in his proposed 2004 budget — an action that finally has brought to a full boil a fight that's been bubbling for months between the wily County Board veteran and a group of newly elected insurgents.

Mr. Stroger, the board's president, says he had no choice but to ask for a quarter-cent increase in the sales tax and a new 4% levy on equipment leases in order to fill a $100-million hole in the 2004 budget he unveiled last week. Standing with him is board Finance Committee Chairman John Daley, brother of Mayor Richard M. Daley.

But Mr. Stroger's focus on raising taxes rather than cutting jobs or hiking user fees stands in stark contrast to the actions taken by Gov. Rod Blagojevich and Mayor Daley, both of whom have made a point of holding the line on taxes despite their own budget woes. That's exactly the kind of ammunition Mr. Stroger's foes have been waiting for.

"This budget is dead on arrival," declared freshman suburban Commissioner Lawrence Suffredin.

Added another freshman commissioner, Chicago's Forrest Claypool: "County government today is about one thing: jobs for politicians. We need cuts. John owes his life to protecting patronage."

Both men have personal reasons to be critical: Both are viewed by insiders as probable contenders for Mr. Stroger's job someday. But outside sources agree that, given the weak economy and national anti-tax mood, Mr. Stroger's new budget represents an enormous gamble.

"This could be John's perfect storm," says David Schulz, a former city budget director who now is a professor at Northwestern University in Evanston. "This is the wrong time to be proposing higher taxes — whether they're rationally justified or not."

Woes have been building

Mr. Stroger, who for two decades has served as president or Finance Committee chairman, has bragged for years about how he put Cook County government back on its financial legs — for instance, freezing the property tax levy five years in a row. But a close look at the numbers behind his latest budget proposal suggests that the current woes have been steadily building for a while, with the county continuing to increase spending at a rapid rate despite flat recurring revenues.

Virtually all of the growth in county revenues since 1999 has come from either increased Medicaid reimbursements — an often volatile source of funds — or receipts from a new tax on parking lots. Nonetheless, non-capital appropriated revenues, one measure of spending, will have risen more than 25%, to $2.55 billion, since 1999 if the 2004 budget is approved. That's nearly twice the 13.6% increase in city non-capital appropriated revenues in the same period.

County officials respond that the city and county data are not necessarily comparable, and point to 1,500 positions that have been eliminated from the county payroll since 1995, 14% of the total. But county Chief Financial Officer Thomas Glaser concedes that "virtually all" of the cuts are in the health fund, which Mr. Stroger promised would be reduced to pay for the new $626-million county hospital.

New commissioners like North Side Democrat Michael Quigley say there are a lot more jobs and waste that can go. One of Mr. Quigley's ideas: Contract with suburban police forces to patrol unincorporated portions of the county rather than maintain a separate sheriff's unit that has added staffers in recent years even as the amount of unincorporated area has decreased by nearly half.

A spokesman for County Sheriff Michael Sheahan replies that it takes a lot of time — and bodies — to serve unincorporated areas that are scattered throughout the county. The sheriff's police also has a large post-Sept. 11 security role, the spokeswoman adds, suggesting that cuts instead be made in county health spending.

The response underlines one factor that both Mr. Stroger and his critics will have to deal with in the budget battle: Officials like Mr. Sheahan, County Treasurer Maria Pappas and others are elected independently, and many have the political clout to protect their turf.

Another stumbling block for budget cutters: Even today, county government draws relatively little public notice.

"People are much less aware of the county than the city or state," says former county Chief Financial Officer Woods Bowman, a professor at DePaul University. And the types of services the county offers — mostly health care for the indigent and prosecution of criminals — tend to be relatively resistant to cuts, he adds.

Biz groups not satisfied

But that's not satisfying business groups such as the Chicagoland Chamber of Commerce and the Civic Federation, both of which want Mr. Stroger to try again.

"We're disappointed that the county has not sought operating efficiencies rather than tax hikes," says Federation President Laurence Msall.

While the 17-member board's dominant Democrats brawl, the final decision in the budget battle is likely to be made by the board's five Republicans. Some are critical of the tax hike, but not all have committed.

Meanwhile, 74-year-old Mr. Stroger gives every indication of holding his position.

"I'm not concerned about being extremely popular and running for office," he told the board. "I'm concerned about operating a stable government."



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