Douglas L. Whitley

By Douglas L. Whitley Executive Vice President Taxpayer's Federation of Illinois

In my estimation, there are two beneficial aspects of the Proposition 13 movement. First, the California vote indicates a return of democracy to the people, for government officials must become responsive to the will of the people, and not to administrative planners seeking government growth. It may not be the same method of participation as Park Commissions choose — being elected officials — but interest and participation in government has increased just the same. Secondly, the success of Proposition 13 will raise the consciousness of legislators. There is greater interest in tax legislation. Consequently, fewer legislators will be casting a vote for tax increases based on the number of green lights on the tally board or the vote cast by the party leadership. Legislators will have to return home to their constituents and justify votes in favor of tax increases. Increased scrutiny of tax bills should help to limit attempts to manipulate the tax statutes.

The Taxpayers' Federation of Illinois defends the right of taxpayers to determine their own tax burden. Specifically, we hold to the principle that tax increases should be sanctioned by referenda. Granted, tax rate referenda are not always successful, nor do they always coincide with the exact moment in time when the taxing district needs added revenue. But we contend that the taxpayer will ultimately support the local taxing bodies. This support may be contingent upon taxpayer trust, specifically, proof that the taxing body has given extensive review to budget priorities and taken action to eliminate or reduce certain spending. The result may be hard times. However, there is another side to the coin. We pose the question, "Are hard times necessarily bad?" A dwindling supply of revenue may result in cost efficiencies and budget trimming which otherwise might never have occurred. While these actions may be difficult, they help to satisfy the need for review and accountability to reassure doubting taxpayers. It's easier to say "No" when you do not have the money.

In a recent report, the National Taxpayers Conference says: "Tax and expenditure limitation should not be seen simply as a negative reaction by the taxpaying public. It could launch a new era of quality and performance in the public service. Limits on what government can tax and spend should be a positive force in improving productivity, emphasizing efficiency, highlighting truly vital services, and freeing government from the obligation to do things whose benefits do not match their cost. For the first time public officials will be able to say "No" without grave political risk."

Is Proposition 13 for Illinois? While we agree that the mood for lower taxes is present and the desire for change evident from the 1978 campaign rhetoric, the facts do not reflect an outright taxpayer revolt for Illinois.

Let us review the recent past. In 1975, the legislature took positive action to roll back the equalized assessed value from 50% to 33-1/3%. The net effect was to save property taxpayers from tremendous increases in their tax bills. In 1977, the General Assembly passed the Farmland Assessment Bill which established a formula to base the value of farmland on productivity instead of sale price alone. The Farmland Assessment Bill met the needs of rural Illinois, where a few land sales were greatly inflating the value of land which was not for sale. In 1978, the General Assembly passed a general homestead exemption (Senate Bill 1790) for $1000 of assessed value, which the Governor in turn increased to $1500 on equalized assessed value. The effect of this bill is to allow $4500 worth of market value increases on residential property without increasing the assessed value for which taxes may be applied. These changes were significant. They show the Illinois legislature has been responsive to the changing mood and needs of Illinois taxpayers.

Illinois Parks and Recreation 8 May/June, 1979

The question which really remains is, "Has the legislature gone far enough?" Illinois' answer to Proposition 13, if it should come, would have to be in the form of a constitutional amendment. One such constitutional amendment was offered during the 80th General Assembly and fell only a few votes short of passage. The sponsor, Representative Don Totten, has introduced House Joint Resolution Constitutional Amendment 13 in the 81st General Assembly.

We believe there is a more immediate question. Recognizing that a constitutional amendment cannot be offered to the Illinois electorate until 1980, will the Illinois legislature wait until 1980 to do something about tax limitation? We think not. There are already numerous bills in the legislative hopper to halt the growth of taxation in Illinois. We suspect the interest in statutory tax limitations will supercede the activity on the constitutional amendment. The statutory reforms have the advantage of not being etched in granite, therefore offering a greater opportunity for flexibility and change as the needs of the state change.

The legislative hearings, testimony and floor debate on the numerous attempts for statutory reforms will provide lawmakers with an opportunity to ask questions and evaluate the impact of various adjustments in the tax laws. Such a preview may serve as a valuable proving ground before the proponents of a constitutional spending limitation for state and local government spending can be undertaken in a reasonable manner.

During the 80th General Assembly, many bills were introduced to make adjustments in the assessing process and the taxing system. In fact, more legislation was introduced to adjust the system than to adjust tax burden.

In the 81st General Assembly we believe the target will be the tax burden. We do not believe the average citizen of the state cares how calculations are made, but rather, are the calculations fair? Taxpayers look for assurances that adjacent homes are assessed equitable. Taxpayers are not responsive to assessment reforms. What they want to know is, "Will my tax bill be smaller?" The bottom line of the tax bill is what is important to the taxpayer/voter.

While the tax burden in Illinois is already above the national average, recent statistics show several changes which will reflect the willingness of Illinois taxpayers to support Proposition 13 reforms. The personal income per capita in 1976 showed Illinois citizens ranking 5th in the nation. The 1977 figures show that Illinois has dropped to 13th. Even more significant than the drop in per capita income is that Illinois' income growth for 1977 was the third worst in the nation, below the cost of living index.

The taxpaying citizen is being forced to make personal concessions, change spending habits, and establish domestic budget priorities. The same citizen wants to be assured that government is not taking advantage of his tax dollars. Taxpayers are looking for and deserve representatives (elected park and district commissioners) and administrators who can provide a quality product at a low cost.

Citizens of this country have finally reached the point where they are confident they are over-taxed. There has got to be a balance. Currently we do not think the balance exists. Consider the following examples:

1. Over 40% of the Gross National Product of this country is accounted for by Government spending.

2. Thirty-eight million people depend on the Government for checks.

3. One out of every six individuals works for the Government.

4. Government dictates and incursions in our lives (even local governments recognize the growth of state and federal government regulations and mandates) are costing our society billions.

5. But most importantly, all of us are tired of working until May to pay our taxes.

I think most of us will concede that Congress is a culprit. But state and local governments cannot vindicate themselves in the eyes of their constituents by laying the blame in Washington.

State and local governments are the pressure points. This is primarily because local governments are closest to the taxpayers. There is a direct, personal relationship between collections and spending at the local level. Consequently, accountability (you may wish to call it budget restraint) is more easily obtained.

Continued on Page 25

Illinois Parks and Recreation 9 May/June, 1979

Is Proposition 13 for Illinois?

From Page 9

In a speech last fall the Director of a State Department stressed the need for accountability in budgeting. He talked about setting priorities, zero-based budgeting, and the need for decreased requests. At first those in the room thought he was talking about state government, but as he proceeded it became evident that what he had in mind was greater restraint by local government. It would seem to me that the two are inconsistent. Setting priorities, introducing zero-based budgeting, and implementing intensive review of increased budget requests should be adopted at both levels. We cannot let the state legislature off the hook by passing the buck onto the backs of local government units.

Local governments should stress their strong points. Educate taxpayers and the electorate of your districts as to the services your Park, Forest Preserve, and Conservation Districts provide. Gain their trust by documenting your cost savings and program re-evaluations. Stress the fact that local government decisions are made by their neighbors and that the value of local control is not to be overlooked.

The Illinois treasury does not have billions of dollars to assist local governments should a Proposition 13 be passed in Illinois. Local government officials must be willing to bend with the "west wind" but concurrently press their legislators for responsible actions, not just reactions, in the state capital.

Illinois Parks and Recreation 25 May/June, 1979