Take a look at that INN story today on Rockford. There’s a broader lesson being played out in many Illinois towns and cities.
The city is considering making itself “home rule” to give it power to raise rates and to tax more things. It’s mayor says he’s looking at a hotel/motel tax increase, a fee for 911 service to private nursing homes, and a new fee on the city’s video gaming machines.
Part of the rationale for those new taxes may be sensible — the city would like to swap them out for lower property taxes.
But it’s unfunded mandates imposed by state law that Rockford and all Illinois municipalities should be screaming about at the top of their lungs. Talk to any mayor and they’ll tell you they have very little control over their costs thanks to unfunded mandates about pensions, wages, collective bargaining and more.
“Our expenses are growing at three percent a year, our pension costs are growing at seven percent a year, and our revenue is growing at two percent a year,” says Rockford’s mayor. That’s the problem, and looking only to the revenue side of that imbalance won’t work.
Not mentioned in the article is that Rockford’s former mayor, Larry Morrissey, was among the first to ask the state for the option of municipal bankruptcy. He didn’t expect to actually have to file for bankruptcy, but having a credible threat to do so would facilitate the contract renegotiation he needed. That’s another element of local freedom Springfield must recognize.
City officials across Illinois must get far more outspoken about the root source of their problems: Unfunded state mandates must be slashed. We’ll be writing more about that here at Wirepoints, as well as the need for bankruptcy authorization.
–Mark Glennon is founder and Executive Editor of Wirepoints. Opinions expressed are his own.