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Ralph Martire says an education funding bill he is promoting would not adversely impact businesses as some detractors have suggested. If anything, he said, "businesses will pay less in taxes" if House Bill 750 becomes law. Martire defended the proposed bill during a two-hour presentation Monday evening in the John Wood Community College auditorium. Martire is the moving force behind the development of HB 750, which calls for increasing funding for public schools while providing property tax relief for homeowners and businesses. The bill has come under attack by some business leaders. They contend it is bad for business because it not only would increase the state income tax to 5 percent from the current 3 percent - primarily impacting the state's wealthiest residents - but also because it would raise the corporate tax, close certain business loopholes and impose a new sales tax on many consumer services. Martire insists businesses would see a "net tax break" under HB 750. "Yes, the corporate income tax rate goes up. Yes, we take away a couple of breaks that favor one business over another but don't seem to have any economic justification," he said. "But because businesses share in the property tax relief, their net tax burden goes down significantly." Martire is the executive director of the Center for Tax and Budget Accountability in Chicago, a bipartisan "think tank" striving to make the Illinois tax system fundamentally fair and economically sound. He says HB 750 would generate about $1.8 billion in extra state aid for schools while providing about $2.4 billion in property tax relief. What that would mean for the five school districts in Adams County would be $9.6 million more state aid and $6.5 million in tax relief, according to Martire's Web site. However, former state Rep. Jeff Mays - now president of the Illinois Business Roundtable - has been circulating figures contending Adams County would end up with a net loss of $10.9 million because county residents would pay $17.7 million more in income taxes and $9.3 million more in corporate taxes. Martire disputed Mays' assertions in response to a question from Quincy businessman Mike Nobis. "I looked at those figures that Jeff Mays provided, and they are inaccurate," Martire said. "Jeff Mays has provided inaccurate information before, and I don't like to say that stuff publicly. But when he's given his numbers to us, we have corrected them repeatedly." Martire said Mays "never factors in the tax relief and refundable credit" that make the bill much more palatable for Illinois residents - particularly low- and middle-income wage earners who would end up paying no more in income taxes because they'd qualify for a refundable tax credit. "And he (Mays) changes the amount of tax relief that goes to businesses," Martire added. "He gives less than House Bill 750 gives because he doesn't believe the relief will be there. So I'm just telling you those numbers are inaccurate." Nobis, who also has been openly critical of HB 750, said he intends to find out if the projections presented by Martire or Mays are correct. "I want to make sure that we don't end up losing overall," he said. State Sen. John Sullivan, D-Rushville, who was in attendance , said he plans to meet with Martire and Mays to inquire why their financial projections for Adams County don't match up. "I'm going to find out," he said. "I have a funny feeling they're never going to agree on that. But we'll at least look at the numbers and see how each of them came up with them." Sullivan may have a say in the fate of HB 750 because a similar measure has also been introduced in the Senate along with an amended version proposed by State Sen. Rick Winkel, R-Champaign, who also attended Monday's meeting. Winkel's proposal would set the individual income tax rate at 4.75 percent (instead of the 5 percent Martire proposes) and the corporate rate at 7.6 percent (instead of 8 percent). In addition, Winkel would do away with some of the other tax increases Martire has proposed, including the sales tax on services. Winkel said HB 750 will never pass the General Assembly if the sales tax on services remains in the proposal. "That sinks that boat, in my opinion," he said. "That is a very, very controversial sort of provision that would make it very difficult for colleagues to commit to a vote." Sullivan said he, too, has "a big concern" about the sales tax proposal in Martire's bill because Illinois is a border state, and any additional sales tax could put Sullivan's 47th Senate District at a competitive disadvantage because of its proximity to Missouri and Iowa. Winkel said a supermajority of the House and Senate will likely be needed to pass the bill because Gov. Rod Blagojevich has promised to veto any legislation containing an income tax increase. "I believe that is one promise he would keep," Winkel said. Sullivan said the bill is bound to face a tough road unless it can somehow generate bipartisan support in both the House and Senate. It remains to be seen if that will materialize. Sullivan said he believes some sort of education funding reform is needed in Illinois. "I think we need to reduce our reliance on property taxes. And so we have to look at other revenue sources," he said. "We need to look at what's best for the kids." Louise Crede, president of the League of Women Voters of Adams County, which co-sponsored Monday's event with several other organizations, said the League of Women Voters of Illinois is backing HB 750. Diane Robertson, superintendent of the Mendon School District, which has been plagued by financial troubles in recent years, also believes the time has come to revamp the way Illinois schools are financed. "The current structure for funding Illinois public education is outdated, unreliable and inequitable," she said. "It's time to fix it." | |
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