Illinois now ranks second to last in funding distribution fairness

Rep. Pritchard's Perspective on Illinois Politics

Corporate Income Tax Refunds going Unpaid

A recent report from the Illinois Department of Revenue shows that the State of Illinois owes over $730 million in corporate income tax refunds.  Unlike unpaid bills, however, unpaid tax refunds are not accounted for in the budget.

The budget specifically shows unpaid bills as accounts payable at the end of the year.  As of June 30, 2010, unpaid but approved corporate income tax refunds were at $690.9 million, the highest level on record, according to the Department of Revenue.  Unpaid but approved personal income tax refunds were much lower at $43.6 million.

The Department of Revenue estimates that they will begin paying back outstanding corporate income tax returns by 2013.  I am working with the Illinois Chamber of Commerce to write legislation that would allow companies that are owed money by the state to apply some portion of their outstanding refund amount to current tax liabilities.

Illinois Fails to Fairly Distribute Education Funds

A recent national report card on education funding gave Illinois an “F” when it comes to funding distribution between low and high-poverty school districts.  One of only three states to receive a failing grade, Illinois now ranks second to last in funding distribution fairness.

The report card was issued by Rutgers University researchers and The Education Law Center in Newark, N.J.  The current system in Illinois is unfair to taxpayers, school districts, businesses and most of all students.

According to Taxpayers’ Federation of Illinois newsletters in April and June, education spending from all sources has risen from $7.9 billion to $24.6 billion in just under 20 years.  While General State Aid (GSA) is intended to equalize or reduce differences in spending across the entire state by providing a minimum amount to property poor districts, the funding formula is complicated and hides shifts in funding from GSA to tax relief for property rich districts and poverty programs.

As a result of programs to help property tax cap districts and those with a large percent of students in poverty, the funding for general education dropped from 88% of GSA in 2000 to 62% in 2009 according to the Taxpayers’ Federation.  Consequently districts with no tax cap and with low poverty levels received little of the increased state funding for education and had to rely more on local property taxes.