Rather than collect a local income tax to fund municipal budgets, the State of Illinois agreed in 1969 to allocate 10% of the state-wide income tax collected from Illinois residents towards funding their local cities, towns and villages. This funding is called the Local Government Distributive Fund. The Governor’s proposed budget for the State of Illinois drastically reduces the amount of income tax revenue returned to local communities, which will impact municipal budgets unless this change is revisited.
In Winnetka, the Local Government Distributive fund makes up 4.12% of the Village’s General Fund. In 2020, the Village received $1,324,348 in LGDF revenue. If cut by 10%, which is the current proposal, the $132,435 in reduced revenue could necessitate a .87% increase in property taxes to maintain essential services to residents. For context, $132,000 is the entire 2021 budget for snow removal supplies and equipment in the Village. Should you wish to voice your opinion, please contact State Senator Laura Fine at Laura@senatorfine.com or 847-998-1717 and State Representative Robyn Gabel at firstname.lastname@example.org or 847-424-5401, and request the State of Illinois not reduce funding to municipalities.