Illinois Press

The following commentary by Jim Tobin, President of Taxpayers United for America, is featured at bcrnews.com. The subject of the commentary is a ballot measure in the city of Princeton, Illinois, on “unlimited home rule taxing power”.

As president of Taxpayers United of America (TUA), I am urging voters in the city of Princeton, Illinois, to vote no on the March 20 referendum to adopt unlimited home rule taxing power. Compared to the average income in Princeton, city politicians and bureaucrats already are living like kings.
Right now, the city of Princeton must have support from a majority of voters in order to raise city taxes. If unlimited home rule taxing power is passed, the city could raise property taxes and create new taxes without asking voters for approval. In addition, adopting home rule would exempt the city of Princeton from the current 5 percent property tax cap. The city could then raise city property taxes by any amount, any time.
Home rule also would allow the city of Princeton to impose new taxes on businesses, gasoline, groceries, parking and almost anything else.
Current and retired city bureaucrats already are rolling in money compared with Princeton residents. They don’t need more money from Princeton residents. The average annual income in Princeton is only $37,000; the median value of a home is only $102,000; and current unemployment stands at 10.2 percent. Retired Princeton bureaucrats also are raking in the dough.
Politicians are notorious for scheduling home rule and property tax increase referenda during primaries, when voter-turnout is low. This March 20, if only 10 percent of voters turn out, Princeton bureaucrats, who will be out in force, will be able to pass this home rule referendum easily.
Princeton voters should go to the polls this March 20, along with their family members and neighbors, and vote no on the unlimited home rule taxing power referendum.
Jim Tobin
Berwyn

Jim Tobin, President of Taxpayers United for America, is quoted in the following story from the Daily Herald.
At a time when property values have gone down considerably, many suburbs have sharply increased how much they’re receiving in property taxes.
More than two dozen towns throughout the suburbs have raised property taxes by more than 20 percent since 2006, according to an analysis of five years’ worth of property tax records.
Among 83 suburban municipalities stretching over seven counties, all but one increased property tax revenue over the five years, despite a flagging economy.
Just three years ago, Schaumburg property owners didn’t have to pay any property taxes to the village. In the two years that followed, they were on the hook for almost $47 million.
“We had a $17 million hole in the budget,” Schaumburg Mayor Al Larson explained. “We had been putting it off and using our reserves hoping the recession would not be as deep as it was. We were so reliant on sales tax that when people stopped buying, that dried up.”
The town of Third Lake also enacted a property tax in the last five years.
Volo’s property tax revenue is 400 percent higher than it was five years ago, but its population has also essentially doubled in that time, contributing to the village’s increased tax allotment.
Bensenville saw its property tax revenue increase by nearly 148 percent over five years. Inverness and Lake Barrington also saw the amounts they were allowed to collect increase by more than 100 percent over the five years.
Critics complain that towns haven’t done enough to relieve tax burdens on their residents, noting that taxes went up despite decreases in property values, stagnating wages of property owners and a higher cost of living. They suggest cutting or consolidating underperforming programs and services, eliminating redundant positions and reducing personnel costs.
“I’m not surprised,” said Jim Tobin, president of Chicago-based Taxpayers United of America. “They should always be frugal, especially during a recession. Instead, they are continually expanding their taxing powers to feed the bureaucracy.”
Residential property owners often bear the brunt of the additional taxes. That’s because commercial property owners average better results and receive larger reductions from property tax appeals, according to previous Daily Herald analyses.
Larson said he hopes that someday the village’s property tax will be eliminated, but he points to more than 100 village positions that have been eliminated over the past five years and a more than $1 million decrease in property tax revenue in the last year.
“We did eliminate some services and our labor force has been reduced substantially,” he said. “But we run into these unforeseen events like the emerald ash borer, which is threatening 60 to 70 percent of our urban forest.”
Recently, Schaumburg officials announced plans to spend some $9 million over the next decade to combat the tree-destroying insect, which might thwart village officials’ plans to decrease property taxes further.
Volo officials said the property tax revenue spike is due to the population boom the village has experienced in the past decade. Though voters granted the village home-rule powers, which includes the ability to increase taxes without a vote of the people, officials said they have been careful not to exploit that particular caveat of the home-rule law.
“We don’t collect our home-rule tax,” Village President Burnell Russell said. “We abate it every year. We’re very aware of the fact that we don’t want our taxes to go up.”
But still, Volo is taking in more property tax revenue per resident than it was five years ago, according to the tax records.
That’s why Tobin said his organization continues to fight against ballot questions that would grant municipalities home-rule powers to tax at will. He said Taxpayers United is opposing such measures in Clarendon Hills, Itasca and Prospect Heights.
“They are constantly trying to raise our taxes,” he complained. “If they have home rule, they can tax just about anything. That’s why it’s so dangerous.”
But almost all of the suburbs that saw property tax revenue drop in the past year had home-rule powers. Bartlett, Elgin, Glendale Heights, Lincolnshire, Naperville, Schaumburg and South Barrington are all home-rule communities that experienced single-year dips in their property tax levies of between 5 percent and 0.5 percent. Hainesville and Sugar Grove also had lower tax revenue than the previous year, records showed.
Elburn is the lone suburb of the 83 analyzed where property tax revenue in 2010 was less than it was five years before.
“What we determined a little over three years ago was that we were going to hold the line to the best of our abilities,” said Dave Anderson, Elburn’s village president. “There’s things we’d like to do, but in your own home it’s no different. If you don’t have the money to pay for something, you can’t do it.”
But Elburn’s tax levy is ticking up. After years of declining property tax receipts, the village received a 3.5 percent increase last year.
And it could go higher because of pension requirements for the city’s police force, Anderson warned. Elburn voters will be asked to support a property tax hike March 20 to pay for the creation of a police pension fund, he said.
“If it doesn’t pass, we’ll have to look at other ways to save,” Anderson said. “Maybe instead of rolling out snowplows with two inches on the ground, we’ll wait until it gets to four inches before we start removing snow.”

Jim Tobin, President of Taxpayers United for America, is quoted in the following story from WREX 13 NBC.
By Andrew Thomason | Illinois Statehouse News
SPRINGFIELD — Illinois’ distressed prepaid tuition program could receive a cash infusion from taxpayers, even though it is not backed by the state.
State Rep. Jim Durkin, R-Western Springs, is backing legislation that would require the General Assembly to cover salaries and benefits for employees of College Illinois!, which is facing a deficit of $559.9 million.
The $3.2 million in annual salaries and benefits for those employees for fiscal 2011 are paid out of the returns on the 12-year-old fund’s investments.
That figure could drop substantially if the General Assembly picks up the tab. Some employees of Illinois Student Assistance Commission, which administers College Illinois!, only spend part of their time working on prepaid tuition fund, according to Durkin’s office.
Durkin also is asking the state to cover the fund’s annual management and administrative expenses of $3.7 million, which also are paid out of the returns on the investments.
“They are state employees and the (contract holders) should not be paying for salary and benefits of people who administer College Illinois!,” Durkin said. “I also believe the administrative and marketing fees fall under that category.”
John Samuels, a spokesman for the Illinois Student Assistance Commission, said Durkin’s legislation is under review.
“We haven’t had time to fully analyze what impact it might have on the program. We appreciate Rep. Durkin’s sincere commitment to the College Illinois! program and its contract holders and will continue to work with him and other stakeholders,” Samuels said.
The $1.1 billion fund allows residents to purchase tuition at a university or college for a child at the current rate. College Illinois! then invests that money with the hope that by the time the child is college-bound, the original investment and profits realized from the investment will cover the cost of tuition.
Questionable investments, the Great Recession and spiking tuition costs have created an unfunded liability in the fund of 30 percent, or $559.9 million.
Part of the uproar over College Illinois! is that investors said it was marketed as being backed by the state, meaning that even if the investments tanked, the state would rescue the fund.
In reality, College Illinois! is not backed by the state. The fund can ask the state for a bailout, but the Legislature doesn’t have an obligation to say yes.
Durkin said his legislation is the first of many steps needed to revive the program, but insisted that it isn’t the start of a much larger taxpayer bailout.
“There may be a time and a place down the road where we will have that discussion. I’m hoping to avoid that. I think that we can put our collective thoughts and our talent together to revise the program,” Durkin said.
Jim Tobin, president of Taxpayers United of America, a taxpayer watchdog group, called giving any taxpayer money to the ailing fund “dumb.”
The fund “shouldn’t be bailed out. It’ll just encourage more … improper investment decisions. It’s best for folks to save their money in the private sector, almost anywhere but with the government,” Tobin said.
Ginnie Flynn and her husband, Dan, bought two semesters for their oldest daughter. Ginnie Flynn said she appreciates the efforts to fix the fund, but she has realistic expectations about its future.
“My hope is the answer lies somewhere in the middle. I don’t think the state is going to 100 percent fix this. I don’t think investors are going to come out 100 percent unscathed,” Flynn said.
College Illinois! has enough assets to fund the program for the next decade. However, the last contract will expire in 2029, long after the fund runs dry if nothing changes.
Another solution to the fund’s crisis is for the state’s universities to give tuition discounts to College Illinois! students.
Colleges and universities, which are owed $880 million by the state already, have been lukewarm to that idea.
“We have lots and lots of needs so it would be difficult to give the College Illinois! students’ special” treatment, Rita Cheng, chancellor for Southern Illinois University at Carbondale. “We’d have to look at it on a case by case basis.”
Jan Dennis, a spokesman for the University of Illinois, the state’s largest university system, said the university knows of the idea of discounts but doesn’t have a position yet.