Quinn Looks at New Plan to Keep Money From Local Government

Despite pleading from local governments, Gov. Pat Quinn wants to suspend payments of their share of state taxes so Illinois can pay off $4.5 billion of debt.

According to Illinois Statehouse News, Quinn has floated a new way to pay off the $4.5 billion the state owes to schools, social service providers, doctors and others. The plan would suspend paying municipalities part of the Local Government Distributive Fund, a cut of many state taxes.

Lawmakers would have to give the state permission to suspend local payments, but this solution would avoid earlier plans Quinn had to borrow as much as $8.5 billion.

“Our goal is to pay the bills and we need the General Assembly's support to make this happen,” Kelly Kraft, Quinn’s Office of Management and Budget spokeswoman, said in the Statehouse News article.

Quinn’s plan could suspend payments to municipalities until the legislature approves borrowing at least $4.5 billion. Senate Leader Christine Radogno (R-Lemont) said the legislators wouldn't support borrowing without more spending cuts.

The Illinois Municipal League is trying to stop the governor's plan, and has asked municipalities throughout the state to pass resolutions opposing it. New Lenox's Village Board .

"We work very hard to tighten our belts," Mayor Tim Baldermann said. "The police deparment, the streets department, Village Hall are down personnel. We still have to provide services. Now they're going to balance the budget on the backs of the taxpayers? Unacceptable. ... That's insane."

The state is facing about a $13 billion budget deficit, and some proposals to reduce that include cutting state-collected revenue for local governments, including one such plan that would take an additional $300 million in income tax from municipalities.

In New Lenox, that could mean a revenue loss of about $562,877. The Illinois Municipal League asked local governments to pass resolutions opposing such plans and send the resolutions to their state representatives.

"Those basic core services are just critical," outgoing Village Administrator Russ Loebe said. "That's the street plow clearing the road. That's the police coming to your door when you need help."

Portions of this article were shared by Illinois Statehouse News.