Think Tank: Seizing Tax Refunds Won’t Help City Budget

UPDATED 02/16/12 7:12 a.m.

CHICAGO (CBS) — The head of a conservative think tank calls the plan to intercept ticket scofflaws’ tax refunds a desperate money grab by the city.

As WBBM Newsradio’s John Cody reports, Illinois Policy Institute chief executive officer John Tillman says the $5 million to $20 million to be gained by intercepting state tax dollars from scofflaws will not change the overall problem, which he says is government overspending.

LISTEN: WBBM Newsradio’s John Cody reports

“The only way to reform what’s going on in the city is to reform the (Tax Increment Financing districts), which are siphoning off tax dollars and putting them into development – that’s an easy fix,” he said. “Number two would be reforming the entire public employee compensation from wages to benefits, and obviously pensions. There is some movement on that, but until that is done, you cannot fix the major problem.”

Tillman also says Chicago needs to open up more city job functions to competitive bidding to reduce operational costs.

Meanwhile, Civic Federation chief executive officer Laurence Msall says the tax intercept plan is justifiable, but will not affect the big picture.

“It’s unfortunate, but the city is in a financial position that it needs to look underneath the couch cushion, basically, to find the resources necessary to maintain this government, because we are in a very difficult financial position,” he said.

Msall says city intercept of state tax refunds is essentially the same as blocking license plate renewal for people with unpaid traffic tickets.

The City Council on Wednesday approved the measure allowing the city to seize income tax refunds for scofflaws who have not paid judgments or parking ticket fines. If your tax return is less than what you owe, the remainder can be taken out of future refunds.

Mayor Rahm Emanuel said deadbeats must pay.

“We will not be in favor of deadbeats and delinquents who have been sitting on the sidelines, putting the burdens on the families in your district and throughout the city of Chicago,” the mayor said.

City officials said Chicago is owed some $400 million in unpaid tickets.

  • Jack

    Rahm is right on this one.

  • tony

    Mayor rahm seems to be pimping everything he could do.i bet he would pimp his own children to make a buck.i stay far away from chicago as i can.Its one big money pit

  • tony

    Problem solved Mr mayor ill just have less taxes taken out of my check so i could owe alittle to the state.throw some eles at me now.

  • Stephanie Neely

    The latest initiative to collect debt owed to the City from state tax refunds will not sit well with those who can least afford it. I’m not justifying citizens not paying their debts and bills owed to the City, but this feels like piling on. Every measure available to collect debt owed to the City should be exhausted, but not measures that disproportionately affect the working poor.

    • Harlin S. Neal

      The City doesn’t care…plain and simple. Personally, I couldn’t afford it, but the city decided that since I owed them money, they were going to take it…plain and simple. And I don’t even live in the city.

      This isn’t a “protect the poor and tax the rich” kind of legislation. This is a “money grab”…plain and simple. Rahm Emanuel started this, and I’ll guarantee you this will spread statewide when it’s all said and done. South suburban Oak Forest is already planning on putting this into place soon. My wife called the state comptroller’s office, and someone in there told her this legislation will eventually be state wide…it’s just that Chicago got first dibs.

  • Afro

    Chicago’s top deadbeat has spoken!

    Mayor Rahm Emanuel said deadbeats must pay.

    What the hell does Chicago even need a mayor for? All he does is fuk with people and pizz them off.

  • Harlin S. Neal

    Well…I had nearly $800 taken from me thanks to what Rahm did. Granted, I owed the tickets…but this has nothing to do with recouping losses as much as it is about the city of Chicago trying to get as much money as it can. It’s like the “speed trap/red light cameras” he’s putting up near city schools, the proposed “one cent per ounce” tax on soft drinks, cigarette taxes, a proposed $5 “cover charge” for strip clubs in the name of educating people about rape, and stuff like that. All this stuff can be described in 2 words…MONEY and GRAB.

  • Harlin S. Neal

    Okay…I have to stand corrected on a couple of things. First…this is NOT a city-only thing. Evidently, the state legislature passed legislation authorizing cities and towns to collect on certain debts. The “Illinois Comptroller’s Local Debt Recovery Program” passed in Springfield authorises places like Chicago to collect on old parking tickets and other “municipal debts” as old as 2005. The exact legislation number is 15 ILCS 405/10.05d. So this started from Springfield…not Chicago. Chicago was just the first city in the state to get in on the taking. According to the Glen Ellyn Patch, Springfield and Oak Forest will enact similar legislation. And accordign to my wife, who called the Comptroller’s office to ask what was going on with our refund…this legislation will eventually spread statewide.

    If there’s some bit of hope for me personally…it’s that there was supposed to be a “60-day” window to appeal any charges. I was supposed to get a letter in the mail explaining what was going on, and have a chance to appeal. If I lost the appeal, or if I didn’t appeal, then the City gets the money.

  • Harlin

    Well now…it’s even worse. I’m a state employee with the DuPage County Public Aid Office. We just got an internal e-mail saying that the City of Chicago now has the authority to garnish wages of state employees who owe tickets to the city. According to that letter, this was done with cooperation with the state’s comptroller’s office. So basically…Springfield is in cahoots (sp?) with the City in regards to taking everything it can get from people. And believe me when I tell you…it first starts in Chicago…it goes statewide really soon.

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