As this year’s legislative session gets underway, in Springfield has an opportunity to lift up hard-working families and alleviate financial stress. We can do this with a simple tool: a refundable child tax credit that re-invests money directly into parents’’ pockets.
If the state passes the proposed child tax credit, it would provide $300 per child to families who earn at or below the median income. Unions like ours at International Union of Operating Engineers Local 150 have been fighting for Illinois families for years. And as the cost of living continues to rise, that extra bit of supplementary help from policies like the child tax credit are precisely what our membership, and parents across this state, need right now to thrive.
Creating a tax credit this year is more important than ever. That’s true not only for those living in poverty, but also for middle-income families who are floundering from inflated costs for food and basic household goods. Working families have been through the worst of it financially, first with the pandemic and now in an economy where many feel they are treading water. In the Midwest, including Illinois, consumer costs have risen 3.7% in just the last year.
For many Illinoisans, including many of our union members, a child tax credit would make all the difference between economic security and being one step away from economic disaster. The extra cash forms the foundation for stability, allowing a family to begin to thrive. Investing in families is an investment in our future, and goes hand in hand with our union values.
That’s why our union was proud to have recently joined a coalition of over 40 organizations in signing a letter urging House Speaker Chris Welch to support a statewide child tax credit.
We know that individual families are not the only winners when receiving tax refunds. Their entire communities win alongside them.
There’s an exponential economic benefit, because these checks would be immediately re-invested in our local economy. The second that families receive tax credits, studies show that they spend over 80% of it on food, child care costs, and school expenses. By putting cash directly in people’s hands, our local communities will begin to prosper from the increased local spending on goods and services.
That’s why data shows that for every dollar our state invests in refundable credit, an additional $2.50 in economic stimulus is generated. In fact, the cumulative effect of the child tax credit would create an estimated $1 billion annually in new economic activity. That money in turn can be reinvested back into raising wages, creating good jobs, and building a better state in which to work and raise a family.
More than that, a child tax credit would massively reduce inequity. If passed, approximately 60% of the recipients across the state would be Black and brown households. In a state where we have ranked as among the worst in the nation for racial financial equality, this would be a game-changer.
The idea of a child tax credit is not new; it has already been proven to be wildly effective. After the Biden administration passed an expanded federal child tax credit in 2021 as a response to the pandemic, the monthly checks of $3,600 to parents helped slash child poverty in half within one year. Unfortunately, the credit was not renewed in 2022, and now child poverty is spiking yet again. To date, many states across the country — such as Colorado, California, Maryland, Maine, New Mexico and more — have enacted similar policies, because they work. It’s time for Illinois to join them.
Every worker deserves to live beyond just making ends meet. If we want Illinois to remain “the best state in the nation for families to raise young children,” as Gov. J.B. Pritzker called us, then passing the child tax credit and putting money in the pockets of the people who keep our local economy humming is one of the fastest ways to do so. The investment will repay itself many times over.
Marc Poulos is executive director of the Indiana, Illinois and Iowa Foundation for Fair Contracting and a member of IUOE Local 150.
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