Proposed $4.8 Billion Cook County Budget Includes Possible Beverage Tax with Promise of No New Taxes Through 2019

Cook County Board Special Meeting - October 13, 2016

Meeting Purpose:
Presentation of 2017 Executive Budget by Cook County Board President Toni Preckwinkle

President Preckwinkle presented the following to the Cook County Board:

• Proposed Executive Budget of $4.8 billion (Agenda-Item 16-5866)
• Proposed ordinance establishing a one cent per ounce tax on sweetened beverages (Item 16-5931).  
• Proposed a resolution that states that if the sweetened beverage tax is passed, the President and Cook County Board resolve not to further increase any of the home rule taxes or deviate from the Property Tax Relief ordinances in 2017, 2018, and 2019 (Item 16-5932)  

Some key aspects of the Proposed Executive Budget:

• 2017 Executive Budget is $400 million greater than 2016, mainly due to increases in salaries
• 87% of the budget is for health and safety functions of the County (excluding pensions and debt services).
• 85% of the General Fund is for personnel costs, and 80% of the County personnel are unionized.
• If the sweetened beverage tax is not passed, the President estimates that there would have to be an additional 670 layoffs in 2017, with 200-300 more in 2018, and 500-600 more in 2019.  Most of these layoffs would come from the health and safety areas, where the majority of the personnel are.
• Even with the sweetened beverage tax, this proposed budget reflects 300 layoffs mainly in the Health & Hospitals System (HHS), President’s office, and Recorder of Deeds office.  However, there is actually a net gain of HHS personnel by 132, even as there are proposed to be layoffs.  These additional people will be in different jobs from those laid off.
• In 2010, the County had 25,613 full time equivalent employees (FTEs).  In 2017, it is proposed to have 23,228.  This represents a 10% reduction since 2010, a reduction of 202 FTE positions from 2016.
• The daily jail population is currently around 7,300, the lowest since 1991.  This will enable the demolition of 3 divisions within the jail, saving about $188 million in repair costs that would otherwise have been required.
• Savings will also come from reducing the number of people called for jury service on any day.  A relatively small number of those actually are chosen for jury service, but all who are called are paid for the day.  
• Revenues are derived from HHS patient fees (33.6%), sales tax (18.7%), property taxes (16.7%), other non-property taxes, such as liquor, cigarette, and hotel taxes (13.3%), other fees (6.14%), grants (5.9%), and other miscellaneous revenues.  
• This budget reflects the expected reductions in funds from the state of Illinois, based on the state’s Stop Gap Spending Plan.  Should Illinois further reduce funds to the County, further reductions will be necessary.
• For the first time, each department’s budget reflects the costs of employee benefits, which were previously lumped into the “Fixed Costs” category.  
• Of the $4.8 billion budgeted, $400 million are capital costs.
• The 1 cent of additional sales tax that was passed last year (and which was effective Jan. 1, 2016) is projected to produce $495 million this year, which will again be allocated for pension obligation reduction ($353.4 million), increased transportation funding ($64.5 million), increased debt service costs ($57 million), and “pay as you go” capital equipment, such as technology ($20.3 million).  

To view the Executive Budget recommendation

• An overall description of the budget is included in Volume 1. 
• Volume 2 contains specific budget details for each department. 

Departmental Hearings - held by the Cook County Board Finance Committee for review of the Proposed Budget  begin on Monday, October 17.

• Check the Daily Schedule here  
• Meetings will be live streamed from the County’s web site  and will also be Video-taped for later viewing 
• League observers will be filing reports on these departmental meetings, so you can also check the LWVCC Eyewitness Reports for summaries. 

Public Comments:  At the start of the Board meeting, there were a number of speakers who expressed support for the proposed Sweetened Beverage tax, mainly on the basis that such a tax can be expected to reduce consumption of those beverages, resulting in improved health.  

Public Hearings: An opportunity for the public to comment about the budget to the Finance Committee.
To register to speak

• Monday, Oct. 24 at 6:30 pm at the Skokie Courthouse
• Thursday, Oct. 27 at 6:30 pm at the Markham Courthouse
• Monday, Oct. 31 at 9 am in Cook County Board Room (569) in the County Building;  
• Tuesday, Nov. 1 at 6:30 pm at the Maywood Courthouse   

Other Observations:

• The office of the President and all Cook County Board member positions are up for re-election in November, 2018, which is also when the 2019 proposed budget will be up for review.  This means that the present Board members will not be faced with voting for additional taxes after this year and prior to facing voters in 2018 should the sweetened beverage tax pass.
  
• Ads are already running on television from the beverage industry denouncing such a tax.  Expect lots of public speakers from both sides (and lots of lobbying of Commissioners) at the upcoming Public Meetings on the budget.

Observer - Priscilla Mims