Stellantis/Chrysler/Jeep shutting down the Belvidere, IL plant

[javacontour]

All of what you said may be true and Chicago schools may use more dollars per capita than other areas but overall Chicago as a whole uses fewer state tax dollars - considerably less when compared to the southern region of the state. The bottom line is the further you get from Chicago the less money is put into the pot and the more money is taken from the pot. Insert any other expense paid for with tax dollars and why can't the Chicagians ask the exact same question you did about Chicago schools about the rest of the state?

Frankly, I think they should.
But they should also ask why they cannot capitalize on the economies of scale issue. Why they need to collect so many more taxes such as additional sales taxes, excise taxes, etc.

You do have extreme examples downstate like Cairo and East St Louis. Those will not be fixed by more cubic taxpayer dollars.
But that doesn't prevent Springfield from spending them.
Two-thirds of the population lives above I80. They can vote at any time to stop sending money downstate. There are 118 legislative districts in IL and at least 2/3rds of them are North of I80. So it's not like they don't have to votes to stop funding the spending downstate if they think Chicago is getting the short end of the stick.

The folks downstate are in the opposite position. If they think they are getting a raw deal, they don't have the political mass to change things in Springfield.

I'd say if Chicago has a bad deal, they have no one to blame but themselves here.

 

[PWMDMD]

Not really. The overall difference in taxes paid per capita is about 5% when you look at the Chicago MSA vs downstate IL.
We also have lower costs because Chicago cannot seem to capitalize on what should be a great asset, economies of scale.

I suspect a great deal of the extra tax revenue paid by folks in the Chicago MSA is consumed by the higher costs of doing business.
The answer is likely in the middle. Downstate IL would be better off than folks North of I80 think they would be. But we wouldn't be as well off as folks think we would be when it comes to being separate from Chicago.

Like most things, the answer is likely between the two extreme views.

Note Cook country and the surrounding counties also pay the most in taxes - anywhere from 3-4x more than the rest of the state. So the Chicago and it's suburbs pay 4x as much in tax (+$6K compared to $1.5K) and receive 4x less ($0.60 compared to $2.88) for every tax dollar collected.

https://www.civicfed.org/civic-fede...-illinois-property-taxes-among-highest-nation

 

[brianl703]

Note Cook country and the surrounding counties also pay the most in taxes - anywhere from 3-4x more than the rest of the state.

Isn't that true for most metro areas? It certainly is where I live.

 

[javacontour]

Isn't that true for most metro areas? It certainly is where I live.

When examined on a per-capita basis, it's about 5% higher than the rest of the state.
The real issue in IL is pension costs eat up about 20-25% of the state budget. The typical state spends 4% of it's budget on state worker pensions.

 

[brianl703]

When examined on a per-capita basis, it's about 5% higher than the rest of the state.
The real issue in IL is pension costs eat up about 20-25% of the state budget. The typical state spends 4% of it's budget on state worker pensions.

Are property taxes in Illinois funding the state budget? Trying to understand if that pension issue is the reason for the high property taxes.

FWIW, if I look at a house in suburban Chicago as many miles from the Chicago city center as my house in Virginia is from the DC city center, with as many square feet as my house in Virginia, the taxes are almost the same, even though the house value is higher for my house in Virginia. (And Virginia has a personal property tax on vehicles, which for a late model vehicle could be over $1k a year).

 

[javacontour]

Note Cook country and the surrounding counties also pay the most in taxes - anywhere from 3-4x more than the rest of the state. So the Chicago and it's suburbs pay 4x as much in tax (+$6K compared to $1.5K) and receive 4x less ($0.60 compared to $2.88) for every tax dollar collected.

https://www.civicfed.org/civic-fede...-illinois-property-taxes-among-highest-nation

I'm actually shocked St Clair County is so low. But I suppose ESL and the West End of Belleville really hold down the averages in St Clair County. But low is a relative term at just under $3k median property tax, meaning the median home is in the $60k range.

 

[LDM]

I'm in no way defending the state - just the idea that Chicago uses all the tax dollars. The state as whole sounds terribly mismanaged. As I said, MA has a surplus and just wrote checks independent of normal tax refunds to taxpayers so it is possible.

Chicago also likes to lie about the funds they use, so I will put a lot of doubt in any study that shows the lower parts of the state end up with more tax dollars of any kind. There have been numerous studies over the year showing how much of it ends up being funneling into various Chicago systems, schools, roads, pensions, etc. Meanwhile the rest of the state has roads that are failing apart, schools that receive little to no funding support outside of local tax dollars (which, in turn, are also being misused by the local admin, but that's another story), and other infrastructure projects that are deliberately underfunded.

As far as the parts of IL seceding from Chicago/Cook county and being unable to fund themselves, pretty much false in its entirety. No more Chicago tax rates for the entire state, no more stolen funds, and just like the surrounding states we would actually be able to compete with having companies want to bring jobs here. More jobs = more people = more revenue that wouldn't go to fund Chicago's deficits and fraud. Iowa, Missouri, Wisconsin, and Indiana aren't suffering like Illinois is under Chicago rule and in fact are doing far better when it comes to jobs and people not leaving the state in droves.

 

[LDM]

I'm in no way defending the state - just the idea that Chicago uses all the tax dollars. The state as whole sounds terribly mismanaged. As I said, MA has a surplus and just wrote checks independent of normal tax refunds to taxpayers so it is possible.

The state is terribly mismanaged. There is no question of that and it occurs at all levels, not just Chicago. Chicago just happens to be responsible for about 80-90% of it.

 

[javacontour]

Are property taxes in Illinois funding the state budget? Trying to understand if that pension issue is the reason for the high property taxes.

FWIW, if I look at a house in suburban Chicago as many miles from the Chicago city center as my house in Virginia is from the DC city center, with as many square feet as my house in Virginia, the taxes are almost the same, even though the house value is higher for my house in Virginia. (And Virginia has a personal property tax on vehicles, which for a late model vehicle could be over $1k a year).

No, but it provides the local funding for schools.
The state has to kick in for pensions because they borrowed from the pension funds, so all the local school districts (and others) paying into the fund have to be "paid back" in a fashion since the state took that money a generation ago.
Not to mention other questionable decisions.

Neither major party has a good record here, so getting political about it really makes no sense.
Income tax wise, IL is a pretty good place to be with a flat income tax. It did rise about 66% in the past decade from 3% to 5% that was supposed to be temporary and then go back down to 3.5%

Almost immediately, it was increased to 4.95%
Then in 2020, they played games with proposing a progressive tax, but played fast and loose with the details. The proposal was a few folks would have the income tax lowered to 4.90% (IIRC, less than $60 annual savings per worker.) The next bracket was 4.95% so the same, and then a higher bracket for millionaires.

But the people didn't trust the politicians after the back-track on the 3.5% rate following the "temporary" 5% so it failed.
But a flat income tax is one of the things I believe IL has right.

 

[LDM]

Does Illinois have a mechanism like Virginia's "Local Composite Index", where the state funds local school districts according to their ability to pay for them?

In Virginia, this serves to take tax dollars collected in Northern Virginia and send them to the rest of the state. Any talk of secession I've heard has been from people who live in Northern Virginia and feel that they are subsidizing the rest of the state.

No, we do not. The schools outside of Chicago are pretty much entirely funded by the local property taxes, which the schools are the majority recipient. Problem is that the Chicago area teacher pensions are entirely funded by the state tax and they take the majority of that money with their high payrolls and the fact that many of these teachers can take more than one pension if they held different positions over the years. There are former teachers collecting 3 pensions due to this. There isn't much that can be done to stop it either as it is also part of the IL constitution, I believe it was added in the early 70s.

 

[javacontour]

No, we do not. The schools outside of Chicago are pretty much entirely funded by the local property taxes, which the schools are the majority recipient. Problem is that the Chicago area teacher pensions are entirely funded by the state tax and they take the majority of that money with their high payrolls and the fact that many of these teachers can take more than one pension if they held different positions over the years. There are former teachers collecting 3 pensions due to this. There isn't much that can be done to stop it either as it is also part of the IL constitution, I believe it was added in the early 70s.

You have issues like a Union Lobbyist working one day as a substitute teacher and able to qualify for a pension.

https://www.sj-r.com/story/news/state/2019/04/04/illinois-justices-back-pension-for/5530195007/

 

[LDM]

Are property taxes in Illinois funding the state budget? Trying to understand if that pension issue is the reason for the high property taxes.

FWIW, if I look at a house in suburban Chicago as many miles from the Chicago city center as my house in Virginia is from the DC city center, with as many square feet as my house in Virginia, the taxes are almost the same, even though the house value is higher for my house in Virginia. (And Virginia has a personal property tax on vehicles, which for a late model vehicle could be over $1k a year).

They do not. Proprety taxes go to the local counties, not the state.

The issue is the pensions for the teachers do end up coming out of the state funding. And the majority of those funds go to the Chicago pensions.

 

[LDM]

You have issues like a Union Lobbyist working one day as a substitute teacher and able to qualify for a pension.

https://www.sj-r.com/story/news/state/2019/04/04/illinois-justices-back-pension-for/5530195007/

You just nailed it on the head with that one and that is just one example of many. It happens on all levels but Chicago is the worst of those that abuse the system. The Chicago political machine uses it as a way to reward those who support them. Every one in the state knows it but there is nothing that can be done as long as Chicago continues to dominate the political systems here in IL. There are many good reasons why the rest off the state talks about secession all the time.

 

[brianl703]

There are former teachers collecting 3 pensions due to this. There isn't much that can be done to stop it either as it is also part of the IL constitution, I believe it was added in the early 70s.

Are they able to collect a pension while still working? AKA "double dipping"?

 

[javacontour]

Are they able to collect a pension while still working? AKA "double dipping"?

I wish I knew.
All I know is oilBabe qualifies for her pension in MO in 2024 and the teachers run their own pension system. The state doesn't control the money. It's a well run pension system.
She chose to NOT get an IL credential when she moved to IL and married me. Her pension may be less, but it's not in danger of going bankrupt.

 

[LDM]

Are they able to collect a pension while still working? AKA "double dipping"?

Its entirely possible and wouldn't surprise me. But the example above of the 1 day sub teacher getting a full pension is exactly the type of abuse we see all the time here in IL. Its very well known and since it was added to the constitution back in the early 70s to protect things like that, there is nothing that can really be done to stop it.

“Membership in any pension or retirement system of the State, any unit of local government or school district, or any agency or instrumentality thereof, shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.”



That’s Article XIII, Section 5, of the Illinois constitution approved by 57% of the 37% of voters who voted in a December 1970 special election.

 

[javacontour]

Its entirely possible and wouldn't surprise me. But the example above of the 1 day sub teacher getting a full pension is exactly the type of abuse we see all the time here in IL. Its very well known and since it was added to the constitution back in the early 70s to protect things like that, there is nothing that can really be done to stop it.

“Membership in any pension or retirement system of the State, any unit of local government or school district, or any agency or instrumentality thereof, shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.”



That’s Article XIII, Section 5, of the Illinois constitution approved by 57% of the 37% of voters who voted in a December 1970 special election.

I had to click helpful because I don't really like it, LOL

 

[brianl703]

Its entirely possible and wouldn't surprise me. But the example above of the 1 day sub teacher getting a full pension is exactly the type of abuse we see all the time here in IL.

You work 1 day and your pension is fully vested?

Here, it works like this:

The Basic Benefit is a monthly benefit in retirement based on your age, total years of service credit and average final compensation . The unreduced benefit is calculated using a percentage of your average final compensation multiplied by your total years of service credit.

I worked for a Virginia local government for about 2 years (which, by the way, left me with a rather negative view of Virginia state and local government..) and I really don't expect much, if anything, from VRS when I retire.

EDIT: I just checked. You get nothing unless you've worked for 5 years.

 

[PWMDMD]

Chicago also likes to lie about the funds they use, so I will put a lot of doubt in any study that shows the lower parts of the state end up with more tax dollars of any kind. There have been numerous studies over the year showing how much of it ends up being funneling into various Chicago systems, schools, roads, pensions, etc. Meanwhile the rest of the state has roads that are failing apart, schools that receive little to no funding support outside of local tax dollars (which, in turn, are also being misused by the local admin, but that's another story), and other infrastructure projects that are deliberately underfunded.

As far as the parts of IL seceding from Chicago/Cook county and being unable to fund themselves, pretty much false in its entirety. No more Chicago tax rates for the entire state, no more stolen funds, and just like the surrounding states we would actually be able to compete with having companies want to bring jobs here. More jobs = more people = more revenue that wouldn't go to fund Chicago's deficits and fraud. Iowa, Missouri, Wisconsin, and Indiana aren't suffering like Illinois is under Chicago rule and in fact are doing far better when it comes to jobs and people not leaving the state in droves.

Well, I'll stay away from the conspiracy theory slant to this discussion other than to say it's not easy for any large public organization to lie about financials and get away with it - too many cooks to not get caught. Maybe they do and maybe they don't but in the absence of quality data stating otherwise...

 

[javacontour]

You work 1 day and your pension is fully vested?

Here, it works like this:



I worked for a Virginia local government for about 2 years (which, by the way, left me with a rather negative view of Virginia state and local government..) and I really don't expect much, if anything, from VRS when I retire.

The lobbyist did pay back contributions of about $193k, but should get $36k/year and probably indexed for inflation. Meaning after 6 years, they are break even and after that, money ahead give or take. If they are in their late 40s early 50s, they may collect for 30 years, meaning the state is on the hook for several million for the pension liability.
Piccioli's age is not given in the Springfield newspaper article. The Chicago Tribune says he was 69 in 2019. As far as I can tell, someone born in 1950 who is still alive today is expected to live to 84 years of age, so the state can expect to pay his pension until 2034, or about 11 or 12 more years.