Cook County Government Budget

Cook County’s tough new era of budgeting

admin — Wed, 16 Nov 2011 15:09:35 +0000

An excerpt from an editorial that appeared in the Daily Herald.com, Wednesday, November 16th:

If all goes as it should, something astonishing in the annals of Cook County government will happen this Friday. For the second year in a row, the county budget will decline, the county board president will keep a campaign promise and the entire process will move forward on schedule.

That the final product will look somewhat different from the budget proposals county board President Toni Preckwinkle rolled out in late October is something of a given, but even that is a sign of the important changes taking place. Preckwinkle is pressing some painful measures on all interests in the county, but her willingness to at least listen to the people affected and their recognition of their responsibility to share in the sacrifices are combining to create a new attitude toward spending….

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Preckwinkle’s budget on track for easy approval

admin — Tue, 15 Nov 2011 15:02:32 +0000

An excerpt from a story appearing in the Chicago Tribune.com, Tuesday, November 15th:

More than a dozen fee and tax hikes sought by Cook County Board PresidentToni Preckwinkle sailed through a first test Monday, setting up final approval of her proposed budget at week’s end.

Even Preckwinkle’s request to increase wholesale alcohol prices, which had fueled intense lobbying and opposition from restaurant and bar owners, easily passed out of the Finance Committee. Just five of the 17 commissioners voted against it.

Preckwinkle’s support fell across both party lines. Although there are fourRepublicans on the County Board, it was two Democrats who regularly voted against Preckwinkle’s requests: William Beavers, and Earlean Collins. The pair of Chicago commissioners, who were allies of former Board President Todd Stroger, staunchly opposed Preckwinkle’s push earlier this year to roll back the rest of a 1-percentage-point sales tax increase. Republican Timothy Schneider, from Streamwood, joined them Monday in mostly opposing the increases.

Most commissioners, however, found areas they could support.

Click here to read the rest of the story.

Pass Preckwinkle’s budget

admin — Thu, 10 Nov 2011 18:07:37 +0000

An excerpt from a letter to the editor as it appeared at Chicago Tribune.com, Tuesday, November 9th:

As a small business owner in Cook County, I know firsthand that with the slumping economy, business is tough. The 2008 sales tax hike in Cook County only made things worse, but the news of Cook County Board President Toni Preckwinkle‘s inclusion of the sales tax rollback in the 2012 budget gives me hope. I am pleased that, despite opposition, Preckwinkle has moved forward with the rollback of the County’s sales tax and has kept her commitment to local businesses and working families.

The tax burden implemented by the previous administration was detrimental to local businesses and consumers. Consumers were crossing the county line to buy the same goods at lower prices, harming the county’s economy and jeopardizing jobs…

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Preckwinkle Stands with Medical Leaders Urging Approval of Alcohol, Tobacco Taxes

admin — Wed, 09 Nov 2011 16:56:43 +0000

Cook County Board President Toni Preckwinkle was joined by Dr. Ramanathan Raju, CEO of the Cook County Health and Hospitals System and leaders in the medical community today at Stroger Hospital to urge the Cook County Board of Commissioners to approve a proposed alcohol tax and an expansion of the tobacco tax in the FY 2012 Budget.

Citing study after study, Preckwinkle noted that raising tax rates on alcohol and tobacco reduces consumption and promotes public health and public safety. Cook County runs an important public health institution so she is mandated by the responsibilities of her office to put forward policies that are good for the well-being of County residents.

“We’re standing together because we all feel very strongly that this is the right thing to do both from a fiscal standpoint and a policy standpoint,” said Cook County Board President Toni Preckwinkle. “Medical science, and study after study have shown that this is an effective way to promote public health and public safety, while being an effective way to pay for the services our government provides. I urge the County Board to approve these modest revenue increases.”

Preckwinkle added that that tobacco and alcohol consumption respectively are the leading and the third preventable cause of death in the U.S. and that taxing these harmful substances reduces consumption.

Joining President Preckwinkle at the news conference was Dr. Raju who joined President Preckwinkle in calling for the County Board to approve this increase.

“As someone who has been in the healthcare field my entire life, I know too well the negative effect that tobacco and alcohol have on the human body,” said Dr. Raju. “Anything we can to do to reduce consumption is a good idea, and I hope the Board will help us approve what is a smart and effective public health policy.”

Preckwinkle was also joined by representatives from the Respiratory Health Association of Metropolitan Chicago, the Chicago Medical Society, the American Heart Association, SEIU Doctor’s Council and the Stroger Hospital Executive Medical Staff.

“We support the proposed ordinance as a way to save lives and lower smoking rates, especially among youth and low-income populations, some of our most vulnerable groups,” said Joel Africk, President and CEO of the Respiratory Health Association. “A comprehensive tobacco tax is essential to improving public health in Cook County.”

“We whole heartedly support an increase on the unit of alcohol by raising the alcohol tax. The evidence shows that such taxes are highly effective in reducing excessive alcohol consumption and related harm,” said Dr. Thomas Anderson, M.D., President of the Chicago Medical Society.

The Alcoholic Beverage Tax rate has not been adjusted since 1989. As alcohol prices have gone up, the County’s effective tax rate on alcohol has decreased. This is an overdue update. The proposal to modestly raise the tax on alcohol restores the tax to its 1995 level, still lower than when it was enacted in 1989. The modest revenue increase will raise the current tax rates by 50%, generating roughly $11 million in new revenue for Cook County. The tobacco tax, currently levied only on cigarettes will now include smokeless tobacco and other tobacco products. It is expected to generate $12.1 million.

The County Board is expected to vote on these items Monday, November 14th.

Ending the Unincorporated Cook County Tax Subsidy

admin — Fri, 04 Nov 2011 17:57:50 +0000

Cook County incorporated residents are subsidizing the police services of unincorporated residents – thus pay for 2 police forces – one that serves them, and one that serves only unincorporated residents

Background:

•2% of Cook County (98,000 residents) live in Unincorporated Cook County

•Unincorporated areas have higher median incomes ($60K vs. $53K) than incorporated areas, yet their services are subsidized by incorporated residents

•State Statute requires that the Sheriff be the “conservator of the peace” for the County

•The Sheriff has determined the minimum level of staffing required to abide by this statutory responsibility

•The difference between the cost of the services currently provided to unincorporated areas and the minimum level is ~$11M.

•The County can create Special Service Areas (SSAs) for each area

•It will take approximately 6 months to institute an SSA – this includes 90 days of analysis, a public hearing and an ordinance being passed

Rationale:

•Unlike health care and court services, the police services the County is trying to collect on can only be used by unincorporated areas

•Policing is typically a municipal service – all incorporated residents pay additional, municipal taxes for police services; unincorporated residents do not

•Issue of fairness and equity that incorporated residents pay for 2 police forces – one that serves them (their municipal services), and one that does not serve them

•Institution of Special Service Areas will make it more equitable – without placing an undue burden

Budget impact:

•Revenues from Special Service Areas are projected to bring in $11M

Supporters:

•Watchdog groups such as the Civic Federation strongly support creating SSAs – they projected an even larger opportunity of $55M

2012 Budget: Raising Revenue by Aligning the Parking Tax Tiers

admin — Fri, 04 Nov 2011 17:43:12 +0000

The tax tiers within the parking tax will be aligned with the City of Chicago, making it easier for parking companies in Chicago to comply with the tax and laying the groundwork for additional City-County collaboration for tax enforcement and audits.

Background:

•The ordinance imposes a tax upon the parking charge paid by customers of a Parking Lot or Garage in the County.

•The actual tax rates are NOT changing.

•Current County tiers start at a higher threshold than those of the City of Chicago. The County is adjusting its tiers to match the City.

•The tiers represent the different rates which a Parking Lot charges its customers. The tax rate is higher as the amount charged by the Parking Lot becomes higher.

•Ordinance was enacted in 2000 and was last amended in 2011 to clarify definitions and align due dates (no rate change).

Rationale:

•Alignment of tiers will allow the County to streamline enforcement of parking garages through the City/County collaboration.

•Aligning tiers will also help registered tax collectors for both City and County to easily calculate and remit taxes.

•The additional revenue will allow the County to invest in County infrastructure.

Budget impact:

•This adjustment is expected to yield an additional $1.32M in revenue in 2012.

Preckwinkle Announces Taskforce to Tackle Unincorporated Cook County Services

admin — Fri, 04 Nov 2011 17:13:29 +0000

After meeting with County Commissioners, municipal leaders, township officials, and hearing from constituents throughout Cook County, Cook County Board President Toni Preckwinkle today announced the formation of a 13-member taskforce tasked with examining costs and services provided to unincorporated Cook County and ending the unincorporated tax subsidy. This taskforce will evaluate opportunities to share costs in a fairer fashion for both unincorporated and incorporated residents and to improve service delivery to residents of unincorporated areas. The President is calling for this task force to recommend a plan for addressing this issue by March 1, 2012.

“Residents throughout the County have reached out to both me and their Commissioners to let us know that the current way services are provided to unincorporated areas is either inequitable or inefficient,” said President Preckwinkle. “We believe that there are different potential opportunities out there for each unincorporated area, and this group will work with residents and civic leaders to formulate recommendations tailored to each area.”

The taskforce is comprised of a diverse group of non-profit, civic and community leaders from throughout the County will report back in 120 days on its recommendations for how to approach services in Unincorporated Cook County. The group will be supported by the following leading civic organizations: Civic Federation, Metropolitan Planning Council (MPC), Chicago Metropolitan Agency for Planning (CMAP) and the Metropolitan Mayors’ Caucus.

The President’s administration will offset the implementation of Special Service Areas (SSA) in the FY2012 Budget by allocating an additional $5 million from the Motor Fuel Tax Bonds to better reflect the timing of debt service payments. Preckwinkle maintains that SSAs can be part of the solution to end the subsidy for police services for only 2% of the County’s population that live in unincorporated Cook paid for by the remaining 98% of residents. She urged members of the taskforce to conduct their study with an open mind that focuses on improving services at a lower cost to taxpayers.

Joining President Preckwinkle at a news conference to announce the committee Cook County Commissioner Tim Schneider (R-15th) who praised the President’s desire to put forth a solution that will ensure fiscal responsibility and reflects what’s best for Cook County residents.

“I believe a proposal as dramatic as this one clearly needs to be planned out,” Schneider said. “To the administration’s credit, we are doing just that. The President has asked me to serve on this task force, and I am proud to do so on behalf of my constituents. I look forward to working with the rest of this committee to explore every possible solution to address cost issues and improve services for my constituents.”

Cook County Commissioner Deborah Sims (D-5th), also a member of the task force, echoed President Preckwinkle’s sentiments that improving services to all of Cook County residents is critical to the long-term stability of the region.

“I attended a meeting with President Preckwinkle last week and I am pleased that she has asked me to be a part of the task force that will be charged with putting a plan together around how to best deliver services to unincorporated residents,” Sims said. “We must continue to provide services in a way that is comprehensive, but also cost effective.”

David Bennett, Executive Director of the Metropolitan Mayors Caucus, stressed President Preckwinkle’s efforts to engage municipalities to find a sustainable solution to this issue.

“Every municipality is unique and would be affected differently by this proposal and I commend President Preckwinkle’s efforts to do this the right way,” Bennett said. “I can’t stress enough the level of collaboration and consultation that has rarely been seen from a County Board President.”

Also joining President Preckwinkle at the news conference was Cook County Commissioner Jeffrey Tobolski (D-16th). He is President of the West Central Municipal Conference.

The complete list of the taskforce is:
Commissioner Tim Schneider
Commissioner Deborah Sims
Henderson Yarborough, Mayor of Maywood
Carol Teschky, Maine Township Supervisor
Laurence Msall, President, Civic Federation
Dave Bennett, Executive Director, Metropolitan Mayors Caucus
Randy Blankenhorn, Executive Director, Chicago Metropolitan Agency for Planning (CMAP)
King Harris, Chair, Board of Governors of Metropolitan Planning Council (MPC)
Barry Nekritz
Woods Bowman
Scott Saef
Adrienne Archia

*The taskforce will also include a representative from the Cook County Sheriff’s office to be identified at a later date

2012 Budget: Savings by Utilizing the Motor Fuel Tax for Long-term Capital Investment

admin — Fri, 04 Nov 2011 16:34:43 +0000

Cook County has been using Motor Fuel Tax (MFT) revenues on a pay-as-you-go basis. By bonding off MFT revenues, Cook County can create a pool of capital funds for capital infrastructure investments for suburban roads, in turn creating jobs while potentially being viewed as a positive by rating agencies

Background:

•In 2012, Cook County will receive $96M in MFT revenue from the State.

•In the past, Cook County has used a pay-as-you-go approach for road and bridge infrastructure, resulting in annual maintenance taking priority over long-term improvements.

•A common practice by other municipalities is to bond off dedicated streams of revenue such as MFT.

•The County proposes to use its MFT revenue stream to issue $100M in Series 2012A bonds for capital projects.

•This would allow $25M to go towards public safety from current State MFT revenues; County would also make an annual payment of $6-9M in debt service while creating a pool of capital.

•With the larger amount of available capital, the County will be able to prioritize and accelerate infrastructure projects.

Rationale:

•For the first time in County history, Highways Dept. will use MFT revenue to take a true investment approach to region’s roads, highways and bridges.

•The 2012 expected capital improvement spending budget of $49M is projected to create 1,316 jobs concentrated in the suburban area of Cook County.

•Suburban infrastructure will see a large, strategic overhaul instead of simply yearly maintenance work which does not improve residents’ access or congestion issues.

•Ratings agencies support using additional, stable revenue stream to relieve the burden on property tax.

Budget impact:

•Would allow an additional $25M to be diverted to the public safety fund from current MFT revenues. (not revenues for bonds)

2012 Budget: Regulate Amusement Devices

admin — Thu, 03 Nov 2011 19:48:07 +0000

The County will begin regulating gaming machines to curb instances of illegal gambling, especially by minors. The ordinance creates a per-machine tax on machines that are used as a game, entertainment or amusement.

Background:

•The ordinance requires all amusement devices owned and operated in Cook County to be regulated by the County.

•Prize generating devices, such as slot machines, mechanical grab machines, and video gambling machines, will be taxed at a rate of $225 per machine.

•Simple amusement devices, such as pool tables, jukeboxes, and simulated sports games, will be taxed at a rate of $150 per machine.

•The County’s Auto-amusement Device Tax Ordinance mirrors the City of Chicago’s ordinance. The City of Orland Park taxes both categories of devices at a rate $300 per machine.

•

Rationale:

•Cook County is responsible for public safety for 5.3 million residents. The public safety system comprises 39% of the County budget.

• A number of amusement devices are being used for illegal gambling activities. Licensing these devices will help the County protect its citizens, specifically minors, from such activities.

•Regulation will help eliminate the unfair advantage non-compliant businesses have over other County businesses.

•The additional revenue will help the County invest in public safety related services.

Budget impact:

•This potential new source of revenue is expected to yield $1.34M in 2012.

2012 Budget: Raise Revenue by Closing Tobacco Tax Loophoes

admin — Thu, 03 Nov 2011 19:18:51 +0000

The Tobacco Tax ordinance currently only applies to cigarettes. The tax will be expanded to other tobacco products. “Roll your own” tobacco products will be taxed on a per ounce base just like cigarettes.

Background:

•Tax rate on Cigarettes will not change, only the tax base will expand

•The tax stamps are imposed on wholesalers, not consumers.

•Ordinance was enacted in 1980 and last changed in 2006 to increase violation penalties (no Cigarette tax rate change).

•More than 85 taxing bodies levy Tobacco Tax in Illinois.

•The State of Illinois imposes a $0.98 tax on a pack of cigarettes and a tax of 18% of wholesale price of tobacco products sold to a retailer or consumer.

	Cigarettes	Small Cigars	Large Cigars	Smokeless	Smoke Tobacco
Current	$0.10 (unit)	NA	NA	NA	NA
Proposed	$0.10 (unit)	$0.05 (unit)	$0.30 (unit)	$0.60 (ounce)	$0.60 (ounce)

Rationale:

•Cook County is responsible for providing public health (35% of the budget).

•Consumption of all tobacco products have negative effects on public health:

Tobacco is the leading preventable cause of death in the United States (18.1% of total US deaths). (Center for Disease Control). Smokeless tobacco is not a safe alternative to cigarettes and is associated with multiple adverse health consequences, including oral cancer, gum disease, and tooth decay. (Center for Disease Control)

•It is more fair and equitable to impose the tax on all tobacco products, instead of just cigarettes.

•The additional revenue will allow the County to invest in its public health and public safety infrastructure.

•68% of voters supported raising the Tobacco tax to close budget deficits in a 2004 poll. (Mellman Group & QEV Analytics 4/04)

•

Budget impact:

•The potential expansion of the Tobacco Tax Ordinance is expected to yield $12.1 million in 2012.