Story posted Thursday, March 18, 2010
Income Tax Tweak Could Cost Meadows $600,000
"We're hoping it's just scare tactics," said Rolling Meadows City Manager Sarah Phillips about Gov. Pat Quinn's proposal to reduce the amount of income tax returned to the municipalities.
In fiscal year 2009, the city received just more than $2.1 million. When Illinois collects income tax from its residents, 10% is allocated for redistribution to the municipalities. That amount is divided by the population of the state to create a per capita figure: $77 in 2009. That money is then transferred to the towns on a monthly basis according to population.
Gov. Quinn suggested reducing the pool from 10% to 7%. Such a change would reduce Rolling Meadows' revenue by about $600,000 annually.
Phillips explained the city has already seen a decline in the revenue source due to income levels falling in the state. She is unsure what the city could do if the measure passes.
"Based upon the last $600,000 we lost from the budget (the closing of Sam's Club), there's going to be additional lay-offs." The city is trying to fill the rest of that deficit with billboards proposed for along Route 53. "That's one of the few ideas that doesn't directly impact the citizens," she explained.
Other options would be to revisit revenue-creating ideas previously rejected by the city council including a natural gas tax or a vehicle license tax.
Phillips does not believe the state legislature would back such a plan.
"We don't think it's going to happen," she said, but added, "We sent letters to all our legislators encouraging them to vote no."
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