Effingham Would Lose Funds Under Governor's Budget Cuts

Local officials are doing the math to figure out how much might get taken our of their budget under Governor Bruce Rauner's budget.

Rauner proposed a $600 million cut in state funds for cities, towns and villages through a 50% reduction in the income tax revenue stream. For bigger Illinois cities, that could mean millions in lost revenue, but even for smaller municipalties, Rauner's proposal would mean a six-figure cut.

(EFFINGHAM CITY ADMINISTRATOR JIM ARNDT)

Effingham is a prime example.

City Administrator Jim Arndt said the State is supposed to return 10% of income tax collected to municipalities, on a per capita basis. Arndt said a proposed 50% reduction in that allocation could cost the City $600,000.

Arndt said the dollars are allocated to the General Fund.  He said, "that's where we pay our police officers from, where we pay to plow streets; that's our bread and butter."

Arndt said he understands Rauner is in a tough spot, but hopes he doesn't penalize local governments who've done their jobs to remain fiscally sound. He said, it's like we (the State) haven't been responsible and you (the municipalities) have been, so we'll take money from you."

Arndt has some perspective on the situation, though. He said former governor Pat Quinn tried the same thing the past two years but Arndt said the General Assembly wouldn't let him.

In the meantime, the City in recent years hasn't received the 10% as directed, but has only been paid a percentage, about 8% instead.