Illinois – The State of Our State<br />4th Annual <br />Elmhurst College Governmental Forum<br />Elmhurst, Illinois <br />...
2<br />Per CapitaPersonal Income<br />Source: U.S. Census Bureau<br />
3<br />Percentage of Growth in State GDP 1999-2009<br />
4<br />Percentage of Growth in Personal Income 1999-2008<br />
5<br />Percentage of Growth (Decline) in Employees on Nonfarm Payroll 1999-2009<br />
6<br />Percentage of Decline of Employees in Manufacturing 1999-2009<br />
Barometer of Job Recovery<br />7<br />Source:  Institute of Governmental  and Public Affairs ,  Illinois Economic Review, ...
8<br />Impact of Job Loss<br />Illinois Job Recovery			600,000<br />Average State Tax Impact/Job*	$   4,200<br />Annual Re...
Big Three Taxes(Personal, Corporate Income Taxes & Sales Taxes)  $ Billions<br />9<br />               Actual or 	 Histori...
10<br />General Funds Cumulative Deficit$34 Billion Spending Base(Billions)<br />Unpaid Bills		$6.5<br />Corporate Income ...
11<br />Proposed Borrowing Plan($ Billions)<br />Debt Consolidation Borrowing		$ 8.75<br />2011 Pension Obligation Notes	 ...
12<br />2012 Structural Deficit($ Billions)<br />Spending in Excess of Revenue		$6.2<br />New Debt Service				   1.5<br />...
13<br />New Enacted Revenues($ Billions)<br />Individual Income Tax			$6.0<br />Corporate Income Tax				   1.0<br />	(Incl...
14<br />Illinois Income Tax Rates<br /> Individual	     Corporate*<br /> 			3.0 %			7.3 %<br /> - 2014		5.0			9.5<br />201...
15<br />Other Revenue Issues(not yet resolved)<br />Gaming Expansion<br />		$1 -1.5 Billion One time Revenues<br />		  500...
Spending Limits(General Funds)Billions<br />16<br />2011				 $34,285<br /> 				   36,818<br /> 				   37,554<br /> 				   ...
Current Tax Rates – 3.5% Growth Rates<br />17<br />*Net “Big Three” Revenue comprises Revenue available to the state after...
Current Tax Rates – 2% Growth Rates<br />18<br />*Net “Big Three” Revenue comprises Revenue available to the state after a...
19<br />What is Illinois’s Tax CapacityState and Local Taxes as a % of Gross State Product<br />National Average			9.2%<br...
20<br />State Government is Primarily a Purchaser of Goods & Services –Not a Provider<br />
21<br />State Government Purchases Services from:<br />Human Services Providers<br />Healthcare Providers<br />Local Gover...
Where do we Start to Cut?<br />22<br />Base Spending<br />                              (Billions)<br />Pensions          ...
24<br />Re-Engineering State and Local Government in Illinois<br />
State Programs<br />25<br />Merge Human Services – Integrated Service Delivery<br />De-Institutionalize<br />Reduce Prison...
26<br />$15 Billion of State Revenues go to Local GovernmentsThrough 230 different programsRepresenting 34% of Local Gover...
27<br />DuPage County Taxing Bodies<br />Countywide			4<br />Townships				9<br />Municipalities			29<br />School Districts...
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Elmhurst college thomasjohnson-taxpresentation 1 26 11 updated

  1. 1. Illinois – The State of Our State<br />4th Annual <br />Elmhurst College Governmental Forum<br />Elmhurst, Illinois <br />January 26, 2011 <br />J. Thomas Johnson, President<br />Taxpayers’ Federation of Illinois<br />(217) 522-6818<br />tom@iltaxwatch.org<br />
  2. 2. 2<br />Per CapitaPersonal Income<br />Source: U.S. Census Bureau<br />
  3. 3. 3<br />Percentage of Growth in State GDP 1999-2009<br />
  4. 4. 4<br />Percentage of Growth in Personal Income 1999-2008<br />
  5. 5. 5<br />Percentage of Growth (Decline) in Employees on Nonfarm Payroll 1999-2009<br />
  6. 6. 6<br />Percentage of Decline of Employees in Manufacturing 1999-2009<br />
  7. 7. Barometer of Job Recovery<br />7<br />Source: Institute of Governmental and Public Affairs , Illinois Economic Review, December 2010. <br />
  8. 8. 8<br />Impact of Job Loss<br />Illinois Job Recovery 600,000<br />Average State Tax Impact/Job* $ 4,200<br />Annual Revenue Impact<br /> of Job Recovery $2.5 Billion<br />*Projected by the Regional Economies Application Laboratories – University of Illinois<br />
  9. 9. Big Three Taxes(Personal, Corporate Income Taxes & Sales Taxes) $ Billions<br />9<br /> Actual or Historical Growth <br />Projected Rate<br />2008 $19.4 $19.4<br />2009 17.7 20.2<br />2010 16.0 21.0<br />Projected 2011 16.5 21.9<br /> $69.6 $82.5<br />Difference $12.9<br />
  10. 10. 10<br />General Funds Cumulative Deficit$34 Billion Spending Base(Billions)<br />Unpaid Bills $6.5<br />Corporate Income Tax Refund Backlog .9 <br />State Group Insurance Backlog1.1<br />Total $8.5<br />2010 Pension Obligation Bonds $3.5<br />2011 Pension Notes $3.7<br />Federal Stimulus through 2011 $4.5<br />
  11. 11. 11<br />Proposed Borrowing Plan($ Billions)<br />Debt Consolidation Borrowing $ 8.75<br />2011 Pension Obligation Notes 4.1<br /> Total 2011 Operating Borrowings $12.85<br />Annual Debt Service $1.5 Billion for 14 years <br />
  12. 12. 12<br />2012 Structural Deficit($ Billions)<br />Spending in Excess of Revenue $6.2<br />New Debt Service 1.5<br /> Total Structural Deficit $7.7<br />
  13. 13. 13<br />New Enacted Revenues($ Billions)<br />Individual Income Tax $6.0<br />Corporate Income Tax 1.0<br /> (Including NOL Suspensions) <br />Estate Tax Reinstatement .3<br /> $7.3<br />
  14. 14. 14<br />Illinois Income Tax Rates<br /> Individual Corporate*<br /> 3.0 % 7.3 %<br /> - 2014 5.0 9.5<br />2015 - 2024 3.75 7.75<br /> 3.25 7.3<br />* Inclusive of Personal Property Replacement Tax<br />
  15. 15. 15<br />Other Revenue Issues(not yet resolved)<br />Gaming Expansion<br /> $1 -1.5 Billion One time Revenues<br /> 500 million Annual Recurring<br />Cigarette Tax<br /> Increase from 98 cents to $1.99 per pack<br /> $330 million<br />
  16. 16. Spending Limits(General Funds)Billions<br />16<br />2011 $34,285<br /> 36,818<br /> 37,554<br /> 38,305<br />2015 39,072<br />
  17. 17. Current Tax Rates – 3.5% Growth Rates<br />17<br />*Net “Big Three” Revenue comprises Revenue available to the state after applicable adjustments resulting from the state corporate, personal income, and sales taxes.<br />
  18. 18. Current Tax Rates – 2% Growth Rates<br />18<br />*Net “Big Three” Revenue comprises Revenue available to the state after applicable adjustments resulting from the state corporate, personal income, and sales taxes.<br />
  19. 19. 19<br />What is Illinois’s Tax CapacityState and Local Taxes as a % of Gross State Product<br />National Average 9.2%<br />Illinois Pre-Tax (Rank 26th) 9.13%<br />Illinois Post-Tax (Rank 8th ) 10.20%<br />16th Place State 9.77%<br />
  20. 20. 20<br />State Government is Primarily a Purchaser of Goods & Services –Not a Provider<br />
  21. 21. 21<br />State Government Purchases Services from:<br />Human Services Providers<br />Healthcare Providers<br />Local Governments<br />Higher Education Institutions<br />
  22. 22. Where do we Start to Cut?<br />22<br />Base Spending<br /> (Billions)<br />Pensions $ 4<br />Employee/Retiree Healthcare 2<br />Medicaid 15<br />K-12 Education 7<br />Higher Education 2<br />Human Services 5<br />Local Government Revenue Sharing 5<br />Corrections 1<br />Mass Transit Operating Subsidies .5<br />
  23. 23.
  24. 24. 24<br />Re-Engineering State and Local Government in Illinois<br />
  25. 25. State Programs<br />25<br />Merge Human Services – Integrated Service Delivery<br />De-Institutionalize<br />Reduce Prison Population by 1/3<br />Privatize Higher Education<br />Re-Evaluate the K-12 Funding Program<br />
  26. 26. 26<br />$15 Billion of State Revenues go to Local GovernmentsThrough 230 different programsRepresenting 34% of Local Government Revenue<br />
  27. 27. 27<br />DuPage County Taxing Bodies<br />Countywide 4<br />Townships 9<br />Municipalities 29<br />School Districts 42<br />Community College 1<br />Fire Protection Districts 23<br />Park Districts 35<br />Others 19<br /> 162<br />

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