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A solution to the property tax problem

MADISON - ST. CLAIR RECORD

Saturday, November 23, 2024

A solution to the property tax problem

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Todd Grigg teaches the importance of dollars and cents.

For more than 20 years, students in Grigg’s consumer education class at Triad High School in Troy have learned how to buy their first car, how to pay for college, and how to balance a checkbook.

But last week was different. Grigg taught one of his most painful lessons of the year: property taxes.

“There’s no doubt,” he said. “In our area and in our state we’re losing people because of high property taxes.”

Grigg is on the front lines of a problem plaguing communities across the state. Illinoisans pay some of the highest property taxes in the nation. And that’s driving people to seek greener pastures elsewhere. Due to Illinoisans’ rapid flight to other states, the Land of Lincoln has been the only shrinking state in the region for the last three years running.

Each year during his tax lessons, Grigg stands in front of a map. And he details opportunities beyond Illinois’ borders.

“I feel I have an obligation to tell them because I care about my students’ well-being more than my state’s well-being,” he said. “I don’t want [my students] to make the mistake of staying here because it’s the only thing they know.”

Local governments shouldn’t be hiking property taxes when so many people are heading elsewhere and teachers feel compelled to offer students an exit plan. That’s a recipe for disaster. Homeowners deserve a property tax system that will give them security in their homes and certainty in the future. They deserve relief.

That’s why comprehensive property tax reform is a key part of a new plan to balance the state budget without tax hikes: “Budget Solutions 2018” from the Illinois Policy Institute.

The first step in the Institute’s plan is a five-year property tax freeze. No longer will Illinoisans see local property taxes rise faster and faster as their personal incomes stagnate. But a freeze isn’t enough. Illinois needs to make its local governments accountable again. Lawmakers must pursue several different reforms.

For one, the state must make it far easier to consolidate units of local government, which often do not provide unique services and come with expensive and duplicative bureaucracies that residents must fund through property taxes.

Illinois has by far the most units of government in the nation, at nearly 7,000. But right now, it can be more difficult to get rid of a unit of local government than it is to amend the Illinois Constitution.

Further, curbing wasteful spending habits at the local level requires eliminating state subsidies that block accountability.

That includes ending revenue-sharing agreements that fuel excessive spending; stopping pension subsidies that allow school districts to dole out higher administrative pay, pension spikes and other unsustainable perks; and doing away with the special carve-outs in the education funding formula that shift state dollars to districts with property tax caps and special economic zones.

Some local governments will cry foul at losing even a dime of state money. That’s to be expected. But this is where the final step of real reform comes in: eliminating costly state mandates imposed on local governments.

Local leaders who actually want reform are currently handcuffed by Springfield. The state must empower local officials to drive the best bargain for taxpayers.

Right now, one-size-fits-all collective bargaining rules drive up the cost of contracts for public projects. The most expensive workers’ compensation costs in the region consume hundreds of millions of public dollars. And outdated prevailing wage rules often mandate six-figure salaries and benefits for basic construction work.

All three of these items require bold reform because all three are baked into property tax bills.

Ultimately, until state and local lawmakers can look residents in the eye and say they’ve tackled the property tax problem head-on, don’t expect families to stick around.

Mentors like Grigg will continue to tell the truth. And Illinoisans will continue to listen.

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