It is being reported that Governor Quinn’s proposed budget will call for a 30% reduction in income tax revenue for the City of St. Charles. If this is implemented, the City of St. Charles stands to lose approximately $800,000 in revenue.

Under the current formula, 10% of income tax revenue collected by the State of Illinois is deposited into the Local Government Distributive Fund or LGDF. That revenue is then distributed to cities, towns, and villages on a per capita (population) basis.  Under the current 10% formula, St. Charles receives approximately $3 million annually. It represents one of the largest sources of revenue for the City.

Under the revised formula, the $3 million would be reduced by 30% or $800,000. To give you a frame of reference, the City’s General Fund – the fund through which most City departments, including police, fire, and public works, are funded – totals approximately $40 million. The $800,000 reduction represents approximately 2% of the General Fund.

If this budget is implemented, the City will have serious decisions to make regarding programs and services. Unless additional revenue is obtained, there is little doubt that reductions will need to be made.

Please contact Governor Quinn and tell him that cities and villages are already sharing “the pain” and that the State of Illinois should not reduce shared income tax revenue.