Tax Hike Zigzag At Cook County Draws Mixed Reviews

Toni Preckwinkle campaigned for county board president as a tax slasher but later pushed new and increased levies. Debate rages over whether she has imposed enough austerity on county government to justify a course correction on taxes.

Rich Hein | Sun-Times

Cook County Board President Toni Preckwinkle rode into office in 2010 on a promise to repeal a county sales tax hike, then a few years later turned course and began pushing a series of big new tax hikes of her own.

Wedged in between that sharp turnabout is the story of her leadership at the county, which is either that of a cost cutting crusader or someone too quick to foist financial pain on taxpayers when the going gets tough.

The former, not surprisingly, is Preckwinkle’s assessment of her own performance over the past six years and her justification for tax increases as a last resort. The latter comes from skeptics on the County Board, among them some of her fellow Democrats.

Preckwinkle’s case comes in part down to this: After rolling back an unpopular one percentage point sales tax hike that doomed the political career of predecessor Todd Stroger, she claims to have trimmed the county payroll by 10 percent to save $144 million, overhauled the county’s sprawling health services bureaucracy to save $300 million, and struck a collaboration with city government on purchasing and printing that saved the county $70 million.

After spearheading such efficiencies, Preckwinkle argued she could then make a solid case for tax increases to cope with mounting pension obligations, flat or declining revenue streams and little prospect of financial support from a state government mired in its own financial mess amid epic political gridlock.

In 2015, Preckwinkle reversed herself and reinstated the same sales tax hike she had condemned during her first campaign—raising the total tax levied on most purchases in Chicago to a nation-leading 10.25 percent. That was followed by a new county hotel and motel tax and a penny-an-ounce tax on sugary soft drinks that’s set to go into effect this summer.

“We’ve had to take some difficult steps to stabilize our finances, but we had no other choice,” Preckwinkle told the Better Government Association. “We’re confronting things aggressively, making tough, but necessary decisions so we don’t pass our problems on to future generations.”

The counter argument comes from fellow commissioners who acknowledge streamlining of county operations under Preckwinkle but also question whether she didn’t have more room for belt-tightening before resorting to tax hikes.

“I think President Preckwinkle’s tenure has been one of mixed results,” said Commissioner Richard Boykin, a Democrat whose district includes Chicago’s West Side and the county’s western suburbs. “She’s done some good things to cut expenses. But she campaigned to roll back the sales tax, then she brought it back. Then she introduces a soda pop tax. With the sales tax, it’s almost like a double tax.”

Richard Boykin
Richard Boykin

Meanwhile, Dick Simpson, a political science professor at the Chicago campus of the University of Illinois, describes Preckwinkle’s reform record as “hit and miss.”

“She’s desperately in need of money,” said Simpson, a former Chicago alderman.  “These days, the city and the county will tax anything that doesn’t move fast.”

Preckwinkle points to the recent passage of the county’s $4.4 billion fiscal 2017 budget as an example of the challenges she faces. Inflation, flat or declining revenue streams, growing debt service costs and uncertainty over state support left the county facing a $174.3 million shortfall.

Rather than make drastic cuts to public safety and public health services, Preckwinkle said she closed most of the hole through layoffs, attrition, spending cuts such as reducing the number of jury summons, and streamlining of tax collection enforcement.

The rest, about $75 million, would come from the new sweetened drink tax. “The principal reason I picked the beverage tax is that I needed the money,” she acknowledged. “But I also picked something that I thought would have a positive effect on public health.”

Preckwinkle’s choices won praise from Laurence Msall, president of the fiscal watchdog Civic Federation. “Assuming that the state will not provide additional funding this fiscal year, Cook County implemented prudent spending reductions and revenue enhancements that will balance the budget this year and for the next several,” he said.

Some belt tightening, Preckwinkle said, drew inspiration from a 14 year old reform plan crafted by then County Board Commissioner Mike Quigley, now a North Side Democratic member of the U.S. House.

The Quigley report, with input from a team of political scientists including Simpson, identified 40 areas of county government ripe for streamlining. While many of those recommendations have languished, a few under Preckwinkle are becoming realities.

One of those old suggestions, consolidation of the county clerk and recorder of deeds offices, was approved by voters in a referendum on the November ballot.

Another Quigley idea, collaborating with the City of Chicago on some functions to reduce duplication, has been ongoing since 2011, Preckwinkle said, with the county saving at least $70 million in supply and printing costs and through combining functions with the city such as workforce development and revenue investigation.

Preckwinkle also said she has worked to reduce jail costs, both by reducing the prison population and by demolishing aging sections of the massive Cook County Jail. The average daily jail population is 7,500, down from roughly 10,000 in 2013, she said. The reduction is mainly due to holding fewer non-violent offenders in custody and increasing the use of home monitoring, Preckwinkle said.

With an assist from the Affordable Care Act, Preckwinkle also claims credit for transforming the county’s public health system from a chronic financial drain into a modest money maker of sorts.

In 2012, the county started CountyCare, a health insurance plan as part of the Medicaid expansion provisions of Obamacare. The goal was to get low-income patients to visit the doctor before they became ill and ended up in the emergency room, which is costlier.

With more than 180,000 patients signed up for CountyCare, revenues exceeded expenses at the county’s public health system by $14 million in 2015. Only 30 percent of the county’s patients are uninsured compared to 75 percent four years ago, though it is difficult to predict whether that progress can be maintained if the new Republican administration in Washington carries out its pledge to repeal Obamacare and replace it with a yet to be defined substitute. 

Bridget Gainer
Bridget Gainer

“We have gone from being a health care system of last resort for our most vulnerable citizens to a provider of choice for all residents,” Preckwinkle said.

Critiques of Preckwinkle’s budget agenda from fellow county board members often come mixed with praise and consternation.

“She’s taken on the hard issues. Taken it on without blinking,” said Cook County Commissioner Bridget Gainer, a Democrat who represents Chicago’s North Side. “But I’m concerned about the taxes. The tourism and convention business is a huge driver for our economy. These people make decisions on where to hold a convention based on these taxes.”

Preckwinkle acknowledges such criticisms are likely to continue, especially since growing pension debt continues to make budget balancing a precarious act and relief from a financially beleaguered state government mired in political gridlock is a longshot.

That said, she makes no apologies for her record.

“Over the past six years, we’ve made some tough decisions. But these were decisions that needed to be made,” Preckwinkle said. “I will continue to look for ways to improve our financial situation, even though I know there will be more challenges ahead.”