County Board President Toni Preckwinkle said Tuesday she believes she has a “path to the nine votes” she needs to reinstate the penny sales tax she campaigned against and she chose that controversial route because it’s better than raising property taxes.
Preckwinkle said her chief financial officer met with county commissioners two weeks ago and sounded them out about a laundry list of tax increases on everything from amusements, cigarettes and alcohol to hotel rooms and sugary soft drinks.
Only two increases generated the “magnitude of resources needed to deal with the pension problem” Cook County faces: property and sales tax.
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“It was clear from those conversations that there was no appetite for a property tax hike, but we had a path for getting nine votes for a sales tax increase. We’re working on it,” Preckwinkle said.
“We’ll introduce it July 1 and we hope we’ll have nine votes when we act on it in July. We need to take this action in advance. The state can’t snap its fingers and overnight implement it,” she said. “We want to implement it in January with the first payment in April. If and when the state ever works through its budget crisis and is prepared to consider other measures, we want to say to them, `We’ve taken the tough vote. We need your help to pass our pension bill.’ ”
Todd Stroger | Sun-Times file photo
If Preckwinkle rounds up the nine votes she needs to reinstate the penny sales tax increase that sealed her predecessor Todd Stroger’s defeat, it would raise the Cook County sales tax to 10.25 percent and generate roughly $308 million a year.
Of that money: $270 million would go toward pensions; $10 million for roads and infrastructure and $25 million to debt service.
In 2010, Preckwinkle hung the penny increase on Stroger with a clever television commercial that featured a Ben Franklin look-alike.
It showed Preckwinkle, a former teacher, in a classroom recalling that she used to teach her history students about Benjamin Franklin’s claim that “A penny saved is a penny earned.”
As county board president, she promised to “put Ben’s words into action” by ending patronage, fighting fraud and, above all, repealing the “whole,” penny sales tax increase imposed by Stroger.
“You’ve earned your pennies. I’ll save them for you,” Preckwinkle said, before laughing and shaking hands with an actor dressed like Ben Franklin.
On Tuesday, Stroger said he knew the county would need revenue but he never expected the penny sales tax to be on the table.
“I thought they’d try anything but,” Stroger said.
“You can try all the tricks in the book but in the end it comes down to — you need to have some kind of revenue to keep the government going and to make any changes happen,” he added.
“She may have run on not having a sales tax increase [but] the office looks a lot different when you’re on the outside than when you’re on the inside,” he said.
On Tuesday, Preckwinkle argued that the pension crisis left her no choice but to do a complete about-face.
“Sometimes the news is bad. Sometimes you’re not completely honest with your children. You try to protect them from the harsh realities and bitter truths. I refuse to consider my constituents as kids,” she said.
“The fact is, every level of government is gonna to have to raise taxes. The city has to do it. The state has to do it,” she said. “There was no way for me to know in 2010 the magnitude of the problem we were gonna face in this pension crisis and the fact we weren’t gonna get the help from Springfield that we need and that every unit of government needs. We’re gonna do what we can to help ourselves.”
Preckwinkle said she has “no idea” whether reinstating the penny will cost her politically, nor is that a factor in her decision-making.
“I don’t have any choice. My job it to do the best job I can where I am. If, in politics, all you care about is planning your next re-election, you’ll always be trimming your sails,” she said.
“When I took this job in 2010, I figured the things I would have to do would make it impossible for me to seek re-election. We had to lay people off and refinance our debt. It was pretty bloody,” she said. “But we worked hard to be reasonable stewards of county government.”
Asked whether she plans to seek re-election, when she will be 71, she said, “I just got re-elected. It’s a long way off.”
Ken Snyder is the political consultant who cut the clever commercial that helped Preckwinkle get elected.
Snyder, who no longer works with Preckwinkle, said he’s not surprised that she would now be seeking to reinstate the penny sales tax increase that she campaigned against.
“Even when I cut that commercial, I didn’t believe she’d be able to hold the line after the first term was over. Ideally, you wish she could. But, pension reform hadn’t been dealt with . So it’s not surprising. I would [only] have been surprised if she made this proposal within her first term,” Snyder said.
Snyder predicted that Preckwinkle would “have to negotiate to some degree” to get a sales tax increase through the County Board. That’s likely to result in an increase of, maybe half-a-penny or three-quarters of a penny — not the full penny. But he does think she’ll get some increase and that Cook County voters will cut her some slack.
“By cutting the budget by $1 billion, holding the line on taxes and instituting all sorts of ethics reforms, her push to increase taxes will be met with a little less skepticism than Stroger’s penny sales tax increase,” Snyder said.
“Voters have a lot more confidence in county government than ever before,” he said. “People aren’t gonna be happy about it. It may not be popular. But the county is in much better shape with regard to operating efficiencies and ethically than it was just four years ago.”
Stroger, though, said he knew he made the right decision back then.
He said, “I knew we were doing the right thing when we were doing it.”
