CORPORATE PERSONAL PROPERTY TAX LOSS

The Illinois Supreme Court on Wednesday, March 14, 1979, ruled the Corporate Personal Property Tax is abolished, effective January 1, 1979 and cannot be collected in 1980.

The Court further ruled that the assessments made in 1978 would be collectable in 1979.

Local government units will lose an estimated $450,000,000 in revenue. It is estimated that park, forest preserve and conservation districts will lose approximately $80 million in revenue. Under provisions of the 1970 Illinois Constitution the General Assembly is charged with replacing the tax to avoid devastating local government programs.

House Bill 548 has been introduced which provides as follows:

"Abolishes ad valorem personal property tax and replaces revenues lost with new taxes. In accord with Constitutional mandate, new repacement taxes imposed as follows: a 2 1/2 % income tax on corporations; a 1 1/2% income tax on partnerships, associations, estates and trusts; and tax on invested capital on payers of messages tax, gas revenue tax and the public utilities revenue tax. Takes effect January 1, 1980."

Governor James Thompson will convene a conference of business, professional and legislative leaders on April 9, 1979 to discuss replacement revenues.

The Association grabbed the initiative in calling a meeting of other organizations representing local governments to prepare a written statement expressing our views to the General Assembly in writing the law to replace this revenue. We feel the new tax should replace the lost revenue dollar for dollar and that it should be based on extensions rather than collections. A growth factor must be written into the legislation and also provisions for collecting and distributing the new funds as soon as possible. All local government units will lose bonding power and we feel that debt limits should either be abolished or increased.

As an outgrowth of this meeting we formed a local government coordinating council with Eugene Berghoff serving as Chairman and Deborah Smith of the Illinois Library Association as Secretary. Additional meetings will be held to express the opinions of all organizations to both the legislative and executive branches of state government.

The Association needs your assistance and support to insure the revenues are replaced, and that the final bill will be beneficial to park, forest preserve, and conservation districts.

STATE OF STATE MESSAGE

Governor James R. Thompson reported to a joint session of the 81st General Assembly on the State of Illinois and his proposed budget for July 1, 1979 to June 30, 1980.

Included in his remarks were a number of recommendations on local government taxes and spending.

Thompson's proposals call for:

(1) Limiting increases in property tax levies by local governments to the rate of growth in personal income in the last calendar year, unless voters approve greater increases. This would not affect taxes needed to pay off local board indebtedness or fund pensions for their employees.

The proposal would tend to reduce tax rates if assessed valuations increase faster than personal income.

(2) Allow voters to call for referendums to reudce local tax rates up to 15%. Voters could not try to reduce rates more than once every two years.

(3) Require local governments or school districts to coduct local public hearings before they could increase property taxes.

(4) Require the state to fund mandated programs or exempt local governments.

(5) Improve the administration of the state's property tax program, including assessment procedures.

(6) Replacement revenues for the Corporate Personal Property Tax.

Governor Thompson also called for a limit on state spending and bond indebtedness.

The governor said he intends to call a conference of business, state and local government leaders and others to work out an over-all acceptable budget and tax program.

ADVISORY COMMISSION TAXATION REPORT

A report for reforming Illinois' tax system was recently delivered to Governor James R. Thompson.

Recommendations included a lid on taxes and government spending and a controversial tax rollback provision.

Chairman Alan S. Granz stated that, "Citizens should be given the power, through local referendums, to roll back virtually any tax rate for local governments and school districts."

In addition, the commission suggests improvements in local property tax administration, public participation which requires two public hearings on budgets, two publication notices, and two votes by local officials

Illinois Parks and Recreation 10 May/June, 1979

when taxes are to be raised.

They also support legislation to eliminate or consolidate some of the 6,000 units of local governments in Illinois with Sunset referendums required every 10 years to determine whether special taxing districts, such as street lighting, sanitation, and park districts are still needed.

Is your district office prepared to meet this challenge? If not, contact the Association's office for a packet of information prepared by the staff and our Public Relations Committee.

CONSOLIDATION OF ELECTIONS

(Effective December 1, 1980)

The following items have been approved to implement this new law. Please review and prepare your district accordingly:

1. The County Clerk and/or Local Election Board be responsible for publication of elections, notices, ballots, voting precincts, etc.

2. Legislation be enacted authorizing a direct tax levy by the county for the administration of elections.

3. Registration, Record Coding and Votes Identification shall be established by the County Clerk or Board of Election. These same authorities would administer the appointment of Judge and absentee voting.

4. The local election official or governing board of each political sub-division be required by law to provide current maps of the boundaries of their units of local government not later than May 1, 1980 to the County Clerk and/or Board of Elections.

As another service to member districts your Association assisted the State Election Board prepare the election handbook for secretaries and the election handbook for judges. If not received by now, please contact the Association office.

TOTTEN CONSTITUTIONAL AMENDMENT HOUSE JOINT RESOLUTION #13

Representative Donald Totten, Republican — Hoffman Estates, has introduced an amendment to the 1970 State Constitution to put a limit on government spending.

Totten's measure would limit state spending to no more than 8% of the average total personal income of Illinois residents for three prior calendar years.

Local governments and school districts would be limited to property income tax increases tied to the rise of the consumer price index. Local governments could not increase their property tax revenue by more than 75% of the increase of the consumer price index yearly. If the index increased 10% in any year the local governments could increase their tax revenue 7.5%.

If the proposition is approved by the General Assembly this year and the voters in 1980, it could go into effect July 1, 1981.

We are putting forth every effort to defeat this proposal to place limitations on local governments including park, forest preserve and conservation districts. Contact your state representative and senator to express your views and the effect of such legislation on your district.

FEDERAL LEGISLATION

(NRPA Vol. VII, No. 5)

PRIMARY ELIGIBILITY LIST FOR URBAN PARK RECOVERY PROGRAM ANNOUNCED

The Secretary of the Interior has released a list of 368 local jurisdictions in states and the District of Columbia eligible to compete for 85 percent of any funds appropriated for the recently authorized Urban Park and Recreation Recovery Program. The remaining 15 percent is available to other general purpose local governments within Standard Metropolitan Areas.

The six variables used to determine eligibility included: population density; net changes in per capita income (indicating relative economic growth); percent unemployed (1977); percent of households without automobile available (1970); total population under 18 years of age and 60 years and over (1970); percent of population with income below 125 percent of poverty level (1970).

Eligibility was determined by combining the variables in a four step process. All values for each of the six variable were expressed in standard units. For each jurisdiction, the standardized value for each variable was added to produce a score. The scores were ranked from high values (most eligible) to low values (least eligible). Jurisdictions having scores above the median score for all jurisdictions were designated "eligible."

Actual start up of the programs in 1979 is contingent upon Congressional approval of a supplemental appropriation. The Administration has requested $37 million for the program, but House and Senate support is still uncertain.

Detailed information about the program is available by writing the Urban Program Task Force, Heritage Conservation and Recreation Service, 440 G. St., N.W., Box A, Room 205, Washington, D.C. 20243.

Illinois Jurisdictions Eligible to Apply

Chicago North Chicago Cicero Oak Park Cook* Quincy Danville Rantoul Village East St. Louis St. Clair* Evanston Urbana Kankakee

*Asterisk indicates county government

BILLS EFFECTING PARK, CONSERVATION AND FOREST PRESERVE DISTRICTS

H.B. 121 — DEUSTER — Amends Sections 20, 20a-1 and 20b-1 of the "Revenue Act of 1939." Requires Valuation of real property to be 33-1/3% of fair cash value until assessment year 1980; in assessment years 1980 and 1981 to be 25%; in assessment years 1982 and 1983 to be 20%; in assessment years 1984 and 1985 to be 15% and in 1986 and all subsequent years to be 10% of fair cash value. (Assigned Revenue Committee) (Assigned to Subcommittee 2-7-79) (Opposed)

Continued on Page 20

Illinois Parks and Recreation 11 May/June, 1979

LEGISLATIVE Continued From Page 11

H.B. 127 — SKINNER — Adds Section 162d to the "Revenue Act of 1939." Establishes a referendum procedure by which resident of any taxing district or school district may reduce the tax rate of any such district by up to 10%. (Assigned Revenue Committee) (Hearing February 9, 1979; assigned to Subcommittee)

H.B. 130 — WILLER, ET AL — Repeals Sections of the Park District Code which permitted annexation of territory by a Park District by the passage of an ordinance without notice to any owner or inhabitant within such territory. Effective immediately. (Assigned Cities and Villages) (Support with Amendments) (Re-submitted — H.B. 674)

H.B. 159 — HUSKEY — Amends Section 2 of "The Gas Revenue Tax Act," "The Public Utilities Revenue Act" and "The Messages Tax Act." Exempts from the taxation, imposed by those Acts, the gross receipts from the sale to school districts of gas or electricity or transmission of messages. (Support with Amendments) (Revenue Committee)

H.B. 179 — PIERCE, ET AL — Amends the Revenue Act of 1939. Changes the amount of assessment from 33-1/3% of actual value to 25% of actual value. Does not affect real property in counties which classify real property. (Assigned Sub-committee) 2-7-79

H.B. 223 — VONBOECHMAN — New Act; provides that the State reimburse units of local government and school districts for increased costs caused by State laws; other provisions. (Support) (Assigned Executive Committee)

H.B. 250 — POLK — Amends Gas Revenue Tax Act and Public Utilities Revenue Act; exempts from taxation gross receipts from the sale of gas or electricity to units of local government. (Support) (Assigned Revenue Committee)

H.B. 255 — SCHLICKMAN, ET AL — Amends Child Labor Law; allows minors under 16 to work at indoor skating rinks owned and operated by park district or municipality. (3-1-79) (Labor and Commerce Committee — Recommend Do Not Pass)

H.B. 285 — FLINN — Amends Revenue Act; provides that county clerk not apply a rate percent for any taxing district or school district which will produce a total tax revenue for that district more than 2 percent above the total tax revenue or the preceding limitation; other provisions. (Assigned to Subcommittee 2-7-79) (Opposed)

H.B. 409 — HALLOCK, ET AL — Amends the Public Aid Code. Requires recipients of general assistance to perform public service work for local governmental units. Effective immediately. (Assigned Labor and Commerce Committee)

H.B. 444 — GRIESHEIMER — Amends an Act providing for the creation of forest preserve districts in counties having a population of less than 3,000,000. Prohibits districts from acquiring or condemning property within a municipality without the consent of such municipality. (Opposed) (Counties and Townships)

H.B. 611 — HUSKEY — Amends Park District Code Section prohibiting members from having any interest in any contract with park district; provides exceptions similar to those for municipal officers. (Support) (Cities & Villages)

H.B. 618 — BLUTHARDT, ET AL — New Act; provides the state must reimburse local governments and school districts for increased costs caused by State laws if such programs represent an estimated additional cost to local governments statewide of over $50,000. (Executive)

H.B. 659 — YOURELL — New Act; provides state reimburse local government and school districts for increased cost caused by state laws creating new programs or expanding existing programs; other provisions. (Executive)

H.B. 674 — WILLER, ET AL — Amends Park District Code; provides that district seeking to become coterminous with one or more cities may not annex without referendum if territory involved has been in a municipality for more than a year or is more than 120 acres. (Cities & Villages) (3-15-79 — 2nd Reading House)

H.B. 709 — RYAN, ET AL — New Act; provides that no unit of local government can increase its property tax revenue beyond 1979 property tax revenue unless increase is approved by referendum.

H.B. 712 — RYAN, ET AL — New Act; creates act relating to state mandating of local government expenditures, services, standards, employment conditions and retirement benefits; provides for partial or total reimbursement to local governments for costs of state imposed mandates. (Executive Committee)

H.B. 720 — FRIEDRICH, ET AL — Amends Act relating to consolidation of elections to defer the taking effect of those Acts from December 1, 1980 to December 1, 1982. Effective immediately.

H.B. 738 — YOURELL — Amends conflict of interest Section in Park District Code to recognize exceptions provided in Act relating to corrupt practices (Ch. 102, pars. 1 through 4).

H.B. 749 — BARNES, ET AL — Amends an Act in relation to the deposit of public funds. Permits a custodian of public funds to deposit them in a saving and loan association.

H.B. 762 — SCHLICKMAN — Amends Section 10-7 of "The Park District Code." Allows a park district to sell or lease its real property to private entities if the grantee or lessee covenants to hold such property for public park or other recreational purposes.

H.B. 799 — HANAHAN, ET AL — Amends Minimum Wage Law. Increases minimum hourly wage to $2.90/hour now, $3.10/hour on January 1, 1980, and $3.35/hour on January 1, 1981, except employees under 18 years of age and $2.85/hour. Reduces employer's gratuity allowance from 50% of wages to 45% on January 1, 1980 and 40% on January 1, 1981. Reduces the number of hours certain employees must work in a week to be entitled to time and a half pay.

H.B. 802 — HANNIG — An Act concerning conflicts of interests of public officers and employees. Provides that no officer or employee of any public agency shall be, indirectly or directly, interested in contract for property or services. Provides penalties, removal from office and such contracts are voidable. Enforcement by Attorney General or State's Attorney.

Illinois Parks and Recreation 20 May/June. 1979

*H.B. 836 — MAHAR, ET AL — Amends an Act in relation to State revenue sharing to include financial assistance to other units of local governments among purposes for which counties and municipalities may use their allocations of revenue sharing of State income tax funds.

ASTERISK — IAPD/IPRA Joint Legislative Committee Bill

H.B. 849 — LECHOWICZ, ET AL — Amends the fiscal note Act to require fiscal notes for bills which have fiscal impact on units of local government, school districts, and community college districts (now only required for bills having impact on State finances). Provides for the preparation of such notes by the Department of Local Government Affairs or by the Illinois Office of Education.

*H.B. 1028 — PIERCE — Amends Section 7-132 of The Pension Code (Par. 7-132, ch. 108-1/2, Ill. Rev. Stat., 1977) to designate governing boards of special recreation joint agreements without designation of an administrative district as included within the definition of "participating instrumentalities" as defined in Article 7 (Illinois Municipal Retirement Fund) (Par. 7-101, et. seq., ch. 108-1/2, Ill. Rev. Stat., 1977)

S.B. 19 — BERNING — Amends Section 162 of the "Revenue Act of 1939." Beginning in 1980, requires the county clerk to apply a tax rate percent to real property equal to the tax rate percent for the immediately preceding year, prior to reduction as required by this Section, reduced by the product obtained from multiplying the tax rate percent for the immediately preceding year by the percent of increase in the assessed valuation for the county for the current year. (Opposed) (Assigned Revenue Committee)

S.B. 26 — KEATS — Amends Park District Code; allows park district to engage in the exchange of real property with a nongovernmental entity provided such property is of substantially equal value and of substantially the same suitability. (Support) (Local Government Committee — 3-1-79 — Recommended Do Pass) (Passed Senate 3-14-79)

S.B. 39 — RHOADS — Amend Revenue Act; reduces petitioners for a referendum on lowering taxes in a taxing district from 5 percent to 1 percent of the registered voters if no general election is to be held; publication period increased from 20 to 30 days; deletes certain exceptions. (Opposed) (Revenue Committee)

S.B. 69 — KENNETH HALL, ET AL — Adds to Intergovernmental Cooperation Act; permits public agencies to enter into agreements with one or more public agencies to share revenue derived from a tax imposed by any such public agency. (Monitor) (Local Government)

S.B. 70 — GROTBERG — Amends an act to authorize units of government to issue full faith and credit tax anticipation notes by increasing the allowable interest from 7 percent to 7.5 percent. (Oppose) (Local Government)

S.B. 96 — GRAHAM, ET AL — Creates an Act requiring the State to reimburse units of local government and school districts for the costs of new programs and services mandated by the General Assembly after January 1, 1980. (Support) (Executive Committee)

*S.B. 297 — HALL — Amends Sec. 11.2 of the Park District Code to allow park districts to levy their working cash fund tax "for not more than four consecutive years only" rather than "for not more than four of the years 1976, 1977, 1978, 1979, and 1980 only."

*S.B. 305 — GEO-KARIS — Amends to exempt from taxation, imposed by the aforesaid Acts, the gross receipts from the sale of gas or electricity or transmission of messages to units of local government or school districts.

Illinois Parks and Recreation 21 May/June, 1979