The state of the State

The next time you hear someone spouting comparisons between Illinois and other states, take a minute to reflect on what is being said. Illinois economic growth, for example, is regularly compared to national growth. Similar comparisons are made for factors like tax burden. But Illinois is a large and diverse state, and statewide numbers are averages of highs and lows from across the state.

In fact, one could argue that there are four easily definable states of Illinois. With more precise data more could be identified. The four states of Illinois include:

(1) the high growth areas in and around metropolitan Chicago and metropolitan St. Louis;

(2) the older industrial cities like Decatur, Pekin, Peoria and Rock Island;.

(3) downstate cities with a white collar or government-supported tax base like Bloomington. Champaign and Springfield;

(4) rural sections dependent upon agriculture.

In April the Illinois Economic and Fiscal Commission released a comprehensive study of property taxes in Illinois that graphically illustrated, county by county, intrastate differences in the property tax base. The study covered the years between 1981 and 1987 (and the taxes collected between 1982 and 1988). During these years Illinois' total property tax base (equalized assessed value) grew 22.5 percent, from $76.0 billion to $93.1 billion. Adjusted for inflation by use of the consumer price index the tax base actually declined 0.3 percent.

So the state property tax base has pretty much held constant — right? Wrong. Twenty-three counties saw an overall increase in equalized assessed value (EAV) over the period; 79 counties saw an outright decline in tax base.

Counties whose EAV grew faster than the statewide average and faster than the rate of inflation were:

Cook County — EAV up 39.9 percent
DuPage County — EAV up 50.2 percent
Lake County — EAV up 35.2 percent
St. Clair County - EAV up 33.6 percent
Will County — EAV up 42.0 percent.

Dewitt and Ogle Counties also saw growth above the state average, but that was the result of nuclear power plants that skewed totals in those counties.

Statewide the total EAV grew $17.1 billion between 1981 and 1987, but in the five high growth counties identified above, the EAV grew $18.2 billion. That means that there were heavy losses elsewhere.

The Economic and Fiscal Commission report broke down property tax base changes by Standard Metropolitan Statistical Areas (large cities and the counties surrounding them). They found:

Metropolitan Chicago (Cook and the five collar counties) — EAV up 39.4 percent.
Illinois sector of St. Louis SMSA —  EAV up 18.4 percent.
Peoria SMSA — EAV down 23.0 percent.
Decatur SMSA — EAV down 17.0 percent.
Illinois sector of the Quad-Cities — EAV down 15.3 percent.
Bloomington-Normal SMSA — EAV up 2.0 percent.
Springfield SMSA — EAV up 3.1 percent.
Champaign-Urbana-Rantoul SMSA —  EAV up 12.1 percent.

Eighty counties classified as rural by the Census Bureau — EAV down 6.9 percent.

There are several factors at work here. First, cities with traditional smokestack industries lost property tax base. As industry moved or cut back, workers either left or took lower paying jobs. The demand for housing dropped. Housing values plummeted. And the communities lost both their industrial and residential tax base. Second, the near depression in the agricultural economy undercut tax base in rural areas. Farm income tumbled. The per-acre value of farmland fell from $2,188 in 1981 to $1,040 in 1987. Over the same period the number of farms in Illinois dropped from 107,000 to 84,000. And rural local governments lost more than 25 percent of

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their farm tax base.

The depression in the farm economy extended into other sectors of the rural economy. Rural areas heavily dependent upon farming were far more likely to see loss of residential or commercial tax base than were their urban counterparts. Between 1980 and 1985 rural Illinois lost 37,000 residents, an average of about 21 persons per day.

Finally, in those areas of the state that showed growth or at least stable employment both the economy and the tax base were growing.

Here's another way of looking at the same issue. Gov. James R. Thompson compiled economic and demographic data by county to measure the progress of his 1987 "Class of 1999" initiative. Eight counties had unemployment rates below the state average of 5.4 percent in February of 1989: Champaign, DeKalb, DuPage, Kendall, Lake, McLean, Sangamon and Woodford.

Likewise, seven counties had per capita income above the statewide average, which stood at $11,302 in 1986. Those counties were Cook, DuPage. Grundy, Kane, Kendall, Lake, and Sangamon.

Not surprisingly the population was growing in the areas where the economy was growing. DuPage, Kane, Lake, McHenry, Will, Champaign, Sangamon and McLean counties all saw population grow faster than the state average between 1980 and 1986.

In short the economy is growing in metropolitan Chicago and St. Louis, holding its own in Springfield, Champaign-Urbana and Bloomington-Normal and on the decline in rural areas and downstate industrial centers.

Even these numbers are imperfect. Take Cook County. It is the average of high growth in some suburban sections and decline in parts of Chicago and south side suburbs like Robbins or Ford Heights. Or look at St. Clair County. Growth in Belleville and Collinsville on one hand overcame the well-documented decline in East St. Louis.

The point here is that there is not an Illinois economy or an Illinois tax burden. The state is made up of distinct and diverse parts. Generalizations about the state tend to overlook these differences, masking the severity of economic problems in some sections while understating growth in others.

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