Pritzker touts surplus, tax relief in Quad Cities stop

ROCK ISLAND – Gov. J.B. Pritzker is touting Illinois’ $1.7 billion budget surplus, the first of its kind in more than a quarter of a century, and laying out plans to convert $1 billion of it into property tax relief for Illinois families.

The Democratic governor’s Thursday, Feb. 10, stop at the Quad Cities Botanical Center, 2525 Fourth Ave., was hosted by the Quad Cities Chamber. It was one of many such pitches he’s making around the state to promote his Family Relief Plan, a centerpiece of the $45.4 billion budget he presented to the Illinois General Assembly on Feb. 2. 

The plan includes, the governor’s office said:

• $475 million in property tax rebates for families, with a one-time property tax rebate payment to homeowners of 5% of property taxes paid, up to $300 for those eligible for a state income tax credit.
• $360 million by freezing the state’s tax on groceries, one of the most regressive taxes. 
• $135 million by freezing the planned increase in the gas tax, which will not jeopardize any planned projects.

The tax relief dollars matter, the governor told a crowd that included local media and chamber staff. If approved, the relief measures would go into effect on July 1, 2022, the first day of the state’s new fiscal year.

“It’s money that goes for paying for milk, eggs and meat at the grocery store, new clothes for growing kids or a couple of visits to downtown Rock Island or right here to the Quad Cities Botanical Center,” Mr. Pritzker said. 

In his stop here, Mr. Pritzker also urged local governments to join in reducing the tax burden on families. “Property tax relief is an enormously high priority,” the governor said. “With significant new taxes coming from Washington and Springfield to schools and to local governments, it’s time for every local taxing body to ask themselves what they can do to reduce local property taxes.”

Meanwhile, he added, “At the state level, we’re jumping forward, and ahead of everybody and saying that we need to provide this new property tax deduction.”

Under Mr. Pritzker’s Family Relief Plan, the state’s grocery tax will be frozen at 1 percent and the motor fuel tax will stand at the current rate of $39.2 cents per gallon. Under state law, the gas tax is raised annually based on inflation. Since 2019, the Illinois gas tax has more than doubled from 19 cents a gallon. The state’s gas taxes finance infrastructure improvements in Illinois. Mr. Pritzker stressed that the freeze will not impact current projects or his signature Rebuild Illinois capital improvement plan.

And by forestalling another automatic gas tax increase in 2022, Mr. Pritzker said, Illinois will be “holding the rate flat at the pump and putting $135 million back in the people’s pockets without delaying any of the infrastructure that the motor fuel tax funds.” For example, he suggested improvements to Centennial Bridge.

“Our economy is ahead of where it was in 2019, and we are seeing a lot of dollars come in from corporate income tax, individual income tax and sales tax to the state. Those dollars ought to go back out to the people of our state,”  he said.

In his speech, Mr. Pritzker also called for rebuilding the state’s Rainy Day Fund. Those funds are reserves set aside to keep states operating during economic downturns, emergencies and other fiscal challenges. Twenty-two months ago, the governor said, Illinois had only enough to fund the government for about 15 minutes. The Government Finance Officers Association recommends states set aside at minimum two months of operating expenditures to weather financial challenges.

Whether the governor will get everything in his budget including tax relief remains to be seen. With such a large surplus, Illinois lawmakers and their top leaders might have other plans for some or all of that money.

After Mr. Pritzker’s speech last week, both Illinois Senate President Don Harmon and House Speaker Emanuel “Chris” Welch applauded the message but didn’t commit to the specifics.

“I’m not accustomed to good news in a budget speech. This is a budget proposal unlike any I’ve seen in my time in the Senate,” Sen. Harmon, D-Oak Park, said in a statement. “There’s a lot to like with this plan, and I look forward to working with the governor to produce a final product.”

Rep. Welch, D-Chicago, said, “Our future is much brighter, and our fiscal outlook is strong. This proposal by Gov. Pritzker is an excellent starting point for our legislative budget negotiations. We cannot lose sight of the fact that we are still very much in the midst of an unprecedented pandemic, and we must continue providing relief to people who are struggling.”