Cigarette tax hike urged - Senate Democrats seek budget deal
Cigarette tax hike urged - Senate Democrats seek budget deal
By Ray Long
Copyright © 2007, Chicago Tribune
July 25, 2007
SPRINGFIELD - The state's cigarette tax would increase by 75 cents under a measure Senate Democrats are pushing as Gov. Rod Blagojevich and the General Assembly struggle to find a way out of the overtime standoff that enters a record 55th day on Wednesday.
The proposed cigarette-tax hike represented the latest move in an elusive search for new revenue that could grease a budget deal, but it would not be enough on its own to satisfy some demands for spending.
A 75-cent-a-pack increase on cigarettes would place Illinois among the highest in the nation for state tobacco taxes. The move comes on the heels of the success of the anti-smoking advocates who this week saw their longtime push to have a smoking ban in Illinois signed into law.
Sen. John Cullerton (D-Chicago), sponsor of the measure going before the Senate Revenue Committee on Wednesday, said the tax would produce about $304 million a year but provide benefits far beyond dollars.
"I love the idea of passing a bill that saves lives and saves money," said Cullerton, who also sponsored the smoking ban.
But while even Republicans acknowledged studies have shown that higher tobacco taxes cause people to quit smoking and prevent youngsters from starting, the GOP lawmakers may be the toughest to persuade to vote for the new proposal because they fear how the money would be spent.
"My guess is we'd be split on it," said Sen. Christine Radogno of Lemont, a Republican budget expert. "Personally, I am OK with taxing cigarettes. I really do believe there is a long-term health benefit because there is evidence that fewer kids start to smoke the higher the tax.
"But to raise money to give this administration dollars to implement these wildly expensive and poorly thought-through programs makes no sense."
The state should be able to balance the budget on the billion dollars in new revenues that have come in from the natural growth in tax proceeds and by eliminating some tax breaks on businesses, she said.
House Majority Leader Barbara Flynn Currie (D-Chicago) said a cigarette tax increase would find a receptive audience in the House because some lawmakers already are talking about raising cigarette or liquor taxes as a source for more money. But she said she did not know if there would be enough votes to pass the cigarette proposal.
"That would be something people in the House would definitely look at," said Currie, a longtime revenue expert.
Illinois' 98-cents-per-pack tax ranked 22nd highest at the beginning of the year, and the Cullerton proposal would raise the rate to $1.73. Other states, such as Michigan, Washington, Maine, Rhode Island and New Jersey, have state cigarette taxes ranging from $2 to nearly $2.58 cents.
But with taxes in Chicago at 68 cents a pack and Cook County at $2 a pack, the overall tax alone in Chicago would be a whopping $4.41.
Sen. Rickey Hendon (D-Chicago) said a higher state tax should have a buffer area of 5 to 10 miles from the state's border, where the taxes would stay the same. The move, he said, would discourage people from crossing the state lines to buy cartons of cigarettes at a lower overall price.
Hendon also is among Senate Democrats trying to breathe new life into a proposal to expand gambling by retooling legislation that already passed the Senate.
The plans for gambling, also still being formulated, would generate around $2 billion but need to overcome resistance in the House, where Speaker Michael Madigan (D-Chicago) has doubted enough support exists for a broad gambling expansion.
Currie restated those doubts on Wednesday, saying she thinks the number of votes needed for a broad expansion would fall short in the House.
Madigan and House Minority Leader Tom Cross (R-Oswego) have pushed to add gambling positions on only the nine current riverboat casino operations, but the Senate plan would add four casinos and add positions at the current gambling boats.
Even so, Sen. Terry Link, a Waukegan Democrat who has long sought a casino for his community, said the program would be hard for the House to turn down because it would provide more money for schools and more money for a capital program that has been fallow under Blagojevich.
"How do they not go on it?" Link said, meaning the House would find it difficult to vote against a package to help schools, fill budget and not hurt the general public.
Even Wednesday's modern record of 55 days in an overtime session did not give lawmakers much reason to believe there would be a quick end to the impasse.
The only thing keeping state government running now is a temporary budget that is set to expire on July 31.
"Wow," Radogno said, reflecting on the moment. "It's a sad situation."
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rlong@tribune.com
By Ray Long
Copyright © 2007, Chicago Tribune
July 25, 2007
SPRINGFIELD - The state's cigarette tax would increase by 75 cents under a measure Senate Democrats are pushing as Gov. Rod Blagojevich and the General Assembly struggle to find a way out of the overtime standoff that enters a record 55th day on Wednesday.
The proposed cigarette-tax hike represented the latest move in an elusive search for new revenue that could grease a budget deal, but it would not be enough on its own to satisfy some demands for spending.
A 75-cent-a-pack increase on cigarettes would place Illinois among the highest in the nation for state tobacco taxes. The move comes on the heels of the success of the anti-smoking advocates who this week saw their longtime push to have a smoking ban in Illinois signed into law.
Sen. John Cullerton (D-Chicago), sponsor of the measure going before the Senate Revenue Committee on Wednesday, said the tax would produce about $304 million a year but provide benefits far beyond dollars.
"I love the idea of passing a bill that saves lives and saves money," said Cullerton, who also sponsored the smoking ban.
But while even Republicans acknowledged studies have shown that higher tobacco taxes cause people to quit smoking and prevent youngsters from starting, the GOP lawmakers may be the toughest to persuade to vote for the new proposal because they fear how the money would be spent.
"My guess is we'd be split on it," said Sen. Christine Radogno of Lemont, a Republican budget expert. "Personally, I am OK with taxing cigarettes. I really do believe there is a long-term health benefit because there is evidence that fewer kids start to smoke the higher the tax.
"But to raise money to give this administration dollars to implement these wildly expensive and poorly thought-through programs makes no sense."
The state should be able to balance the budget on the billion dollars in new revenues that have come in from the natural growth in tax proceeds and by eliminating some tax breaks on businesses, she said.
House Majority Leader Barbara Flynn Currie (D-Chicago) said a cigarette tax increase would find a receptive audience in the House because some lawmakers already are talking about raising cigarette or liquor taxes as a source for more money. But she said she did not know if there would be enough votes to pass the cigarette proposal.
"That would be something people in the House would definitely look at," said Currie, a longtime revenue expert.
Illinois' 98-cents-per-pack tax ranked 22nd highest at the beginning of the year, and the Cullerton proposal would raise the rate to $1.73. Other states, such as Michigan, Washington, Maine, Rhode Island and New Jersey, have state cigarette taxes ranging from $2 to nearly $2.58 cents.
But with taxes in Chicago at 68 cents a pack and Cook County at $2 a pack, the overall tax alone in Chicago would be a whopping $4.41.
Sen. Rickey Hendon (D-Chicago) said a higher state tax should have a buffer area of 5 to 10 miles from the state's border, where the taxes would stay the same. The move, he said, would discourage people from crossing the state lines to buy cartons of cigarettes at a lower overall price.
Hendon also is among Senate Democrats trying to breathe new life into a proposal to expand gambling by retooling legislation that already passed the Senate.
The plans for gambling, also still being formulated, would generate around $2 billion but need to overcome resistance in the House, where Speaker Michael Madigan (D-Chicago) has doubted enough support exists for a broad gambling expansion.
Currie restated those doubts on Wednesday, saying she thinks the number of votes needed for a broad expansion would fall short in the House.
Madigan and House Minority Leader Tom Cross (R-Oswego) have pushed to add gambling positions on only the nine current riverboat casino operations, but the Senate plan would add four casinos and add positions at the current gambling boats.
Even so, Sen. Terry Link, a Waukegan Democrat who has long sought a casino for his community, said the program would be hard for the House to turn down because it would provide more money for schools and more money for a capital program that has been fallow under Blagojevich.
"How do they not go on it?" Link said, meaning the House would find it difficult to vote against a package to help schools, fill budget and not hurt the general public.
Even Wednesday's modern record of 55 days in an overtime session did not give lawmakers much reason to believe there would be a quick end to the impasse.
The only thing keeping state government running now is a temporary budget that is set to expire on July 31.
"Wow," Radogno said, reflecting on the moment. "It's a sad situation."
----------
rlong@tribune.com
posted by Carlos T Mock at 11:47 AM
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