Oak Brook says cut in state revenue would harm service
Updated: July 30, 2012 1:42AM
A plan unveiled May 21 by state Senate Democrats could affect the budgets of many municipalities if passed.
According to an Oak Brook press release, the plan would take money away from local communities through a reduction in local government distributive fund revenue.
Until 2011, cities and counties received 10 percent of total income tax collections, until they were cut out of any additional revenues collected as a result of the state income tax increase. The state lowered the amount received by municipalities to 6 percent.
“It would cap us off,” Assistant Village Manager Blaine Wing said. “The way we look at it is, we were 10 percent before and now we’re down to 6 percent, but our costs continue to increase.”
The senate proposal would prevent village’s from collecting the full 6 percent, and Oak Brook officials estimate that any reduction would create a budget shortfall for Oak Brook of $16,000 to $32,000 per year. If the state were to take such action, it could mean service or personnel cuts to the village budget.
“For us, we do have a fund reserve and we would be able to still have a balanced budget this year,” Wing said. “A part-time employee is about $15,000, so that’s two part-time employees.”
Village President Gopal Lalmalani said he was disappointed to hear the proposal and urged residents to contact their elected officials downstate to support the village.
“We are certainly very concerned,” Lalmalani said. “I know Springfield is in trouble financially and they are doing the best they can to get after the municipalities and the monies that actually belong to us. The services and other things we do for the community can be impaired if this actually goes through. No municipality in Illinois is safe when Springfield is in session.”
Lalmalani said a previous plan by House Speaker Michael Madigan could have cost Oak Brook $275,000, as the state was looking to municipal revenues to cover the teacher pension program’s deficit.
The village’s release says a reduction in distributive revenue could lead Oak Brook back to “recessionary revenue levels.” If the proposition were to pass, the state would keep the money to spend on its own priorities.
Oak Brook, whose budget year runs from Jan. 1 to Dec. 31, will begin discussions on the 2013 budget later this summer.
“We’re paying attention to it,” Wing said. “We start our budget process in mid-July. We’ll definitely be watching what goes on with that. Every nickel counts.”