County Budget

Northwest Side county commissioners voted in favor of Cook County Board President Toni Preckwinkle’s $3.32 billion budget on Nov. 9.

The budget includes a $1 increase in the county tax on a pack of cigarettes, a $25 tax on the purchase of guns and a tax gambling machines while rolling back the remaining portion of the 2008 sales tax increase.

The county board Finance Committee approved $41.7 million in new taxes and also voted to create an advisory committee that will oversee violence prevention, intervention and reduction programs. Preckwinkle dropped her proposal for a 5-cent-per-bullet tax on ammunition for lack of support.

County Commissioner Edwin Reyes (D-8) said that he changed his mind on the gun tax after Preckwinkle dropped the ammunition tax and added an exemption for law enforcement personnel.

“My position on the gun law is, who are we really trying to tax?” Reyes said. “Criminals don’t buy guns. Law-abiding citizens will have to pay this, but it’s all a part of the compromise . . . and we will invest $2 million in violence prevention.”

Reyes said that the commitment to violence prevention also helped change his mind. Most of the funds, which Reyes said come from savings in the hospital system, will be used for grants to nonprofit organizations that have a records of violence prevention.

“A lot of young kids who get caught with guns and enter the court system don’t have much hope, and my hope is that this prevents some of them from picking up a gun in the first place,” Reyes said. “We have a domestic court. We have a DUI court. We have a lot of courts that deal with specialized cases, so why not gun cases.”

County Commissioner Bridget Gainer (D-10) said that “straw purchases,” or guns that are purchased legally but then are resold to criminals, are a big problem. “It’s not the criminals who will pay the tax, but the person that provides guns to criminals,” Gainer said. “Straw purchases are a huge problem, and we need to address it.”

County Commissioner Larry Suffredin (D-13) said that he supports the gun tax because the funding will be used for the hospital system and prevention. “The cost of gun violence is huge, and this gun tax will help with keeping those three going and operating more efficiently,” Suffredin said.

The budget seeks to close a $267.5 million shortfall caused by revenue declines and the sales tax reduction, which will to take effect on Jan. 1 and which will cost the county about $86 million in lost revenue. The county sales tax will be reduced to 0.75 percent, leaving the sales tax in Chicago at 9.25 percent.

The shortfall is driven by increases in the health fund from $894 million to $965 million as part of the implementation of the Affordable Care Act. The Cook County Health and Hospital System is seeking approval for a Medicaid waiver to expand eligibility to 133 percent of the federal poverty line and enroll 115,000 of its patients into Medicaid.

The waiver revenue is expected to bring in $99 million in health care revenue. About 57 percent of patients in the system have no health insurance.

With the increase, the tax on cigarettes in the city will be $6.67. The tax, which will provide $25.6 million in revenue, is scheduled to go into effect on March 1. Most commissioners did not seem to mind the increase, even though they said that it would push many out of the county to make their purchases of tobacco.

County Commissioner Peter Silvestri (R-9) said that he was not in favor of the cigarette tax or the gun tax. “It’s a good budget and it holds the line on estate taxes,” Silvestri said. “It does contain a lot of specialized taxes that I am opposed to. The cigarette tax is really about promoting avoidance, but it will drive out a lot of people from the county.”

“We support eliminating the sales tax and need to supplement that tax with taxes that can be avoided,” Silvestri said. “You are not going to be paying more for food, but if you smoke, you might have to dig a little deeper into your pocket.”

“We don’t know how much we can bring in from the cigarette tax, but it will make a lot of people leave the county (to purchase cigarettes),” Reyes said. “The revenues from cigarette taxes are down already. The justification is that it will make more people try to stop smoking.”

The budget also calls for a $1,000 tax on each slot machine at the Rivers Casino in Des Plaines and a $200 tax on each video gambling machine in bars.

“The gambling tax and the cigarette tax are something that I can live with,” Gainer said. “We all know the cost gambling has on society. I was opposed to the alcohol tax last year, but as far as increases on gambling and cigarettes, especially with the higher costs of health care that are associated with it, it’s not something that I have a problem with.

Preckwinkle originally proposed an across-the-board $800 tax on gambling machines, but Suffredin said that did not seem fair to smaller businesses.

“The tax would punish small mom and pop shops that probably only make $10,000 off two machines, while Rivers is making a killing, so we changed it to $1,000 for Rivers and $200 for small businesses,” Reyes said.

The commissioners called this year’s budget process smoother than last year’s, and they lauded Preckwinkle’s commitment to rolling back the sales tax increase. She campaigned in 2010 on the promise that she would roll back the sales tax increase spearheaded by former board president Todd Stroger.

“I think that this is a comprehensive budget that holds the line on sales and property taxes,” Gainer said. “There is a reduction of county positions, but we also have some fee increases on top of the reduction of the sales tax. Our biggest cost is personnel.

“The big elephant in the room is how we will address pensions. We will have to get our pension fund solvent, and I think that this is the last budget that we can pass without addressing the problem and still provide services and not raise property taxes.”