Mr. Keeling answered questions from the editors of the Voice, the Rockford Regional Chamber of Commerce's monthly newspaper.
Rockford has twice rebuffed home rule. (1970 and 1983) What has changed to make home rule right for Rockford in 2005/2006?
The Illinois Constitution was adopted in 1970. While it is accurate to say that the citizens of Rockford voted 52% against ratification of the Constitution, it is not fair to conclude that they thereby voted against Home Rule. There were many aspects of the Constitution that were controversial. The most controversial provision was the enablement of an income tax at the state level. It is ironic that currently Home Rule opponents are suggesting that Rockford will adopt a local income tax if Home Rule is re-established, a fallacious argument because no Illinois community (Home Rule or not) has the power to impose income tax.
The first time Rockfordians had a chance to vote on Home Rule was a referendum to terminate our Home Rule status in 1978. The citizens voted to retain Home Rule. In 1983 we did vote out Home Rule and have lived without it since. In 1983 this reaction was due to a number of factors affecting the citizens of Rockford. Most importantly, we were in a severe economic recession and at the time of the Home Rule vote had a nation leading unemployment in the 25% range. The citizens of Rockford felt that life was changing and our transformation away from being one of the nation’s wealthiest communities was well at hand. In 1983, the citizens also reacted to recent tax hikes. Home Rule opponents crafted an argument that Rockford could distinguish itself by becoming a low tax community.
The environment has marketably changed from 1983. Among other things over 75% of the current 2005 electorate were not in the electorate of 1983 and have never had the opportunity to vote on Home Rule for this community. When Home Rule was voted out in 1983 there was 13 years of experience with it. Now we have 22 years of experience without Home Rule. Our community has trailed its peer group cities in many important ways. While the lack of Home Rule is not cause of community problems, the lack of Home Rule deprives ourselves and our elected officials of important tools with which to deal with community problems. In the areas of crime; education; protection of public health and safety and economic development.
How do you address the concern that Rockford property taxes will rise faster than the rate of inflation once Home Rule passes and we are no longer subject to state caps?
It is a myth that Home Rule communities have property taxes higher than non-Home Rule communities. It simply is not supported by the empirical evidence. Scholarly studies, our own history, and how Home Rule has been used in Illinois have proven this out.
Banovetz & Kelty in Illinois Municipal Review (April 2003) examine the 32-year record of Home Rule in Illinois and say there is no truth to the assertion that property taxes have increased more in home rule cities and villages.
In fact, according to the Office of the Illinois Comptroller’s own study, Home Rule communities are less dependent than non-Home Rule communities on property taxes as a share of their revenues, because they are able to spread a share of taxes on to non-residents.
Tom Rooney in Journal of Regional Analysis & Policy 32: 1 (2002), studied the effect of Home Rule on municipal tax structure and effort. His analysis reveals that Home Rule is not a significant factor in the level of taxation; rather Home Rule is used for regulatory purposes than for taxation.
Dye & McGuire, in the Journal of Public Economics 66 (1997) in their study of 134 Home Rule and 104 non-Home Rule communities concluded that, found that in property taxes increased 61% more rapidly in non-Home Rule communities than in home rule communities.
After we voted out Home Rule in 1983, our property taxes fell to the non-Home Rule rate, but in a series of referenda we soberly voted to raise real estate taxes back up to the old rate in order to preserve city services in recognition that by abandoning Home Rule, we had also discarded our ability to fund services that we as a community require (police and fire to name two) with other funding sources.
Let’s remember that the Mayor and City Council are also residents of this community. They would be raising their own taxes as well. We share the burden of growth by diversifying our revenues and spreading the cost around. As a parallel topic let’s also note that there are impact fees and various utility taxes that non-Home Rule communities can in fact implement. Rockford has chosen not to do so. Why opponents of Home Rule would say that our elected officials would go hog-wild with taxes when they haven’t even used their full non-Home Rule taxing power, is just an example of the scare tactics that those opponents use.
Over 70% of all citizens of Illinois now live under Home Rule. The people of Illinois have voted yes to keep Home Rule in 25 out of the 29 referenda over the last 34 years. In 83 Home Rule communities, 91% responded that there hadn’t been a petition to abandon Home Rule, nor had there been any periodic, significant criticism of Home Rule in their community. This shows that Illinoisans do not believe that taxation has been extreme and that they are generally pleased with how their officials have used Home Rule.
What are the two most recognizable immediate benefits businesses will see if home rule is brought back?
As chairman of Empower Rockford, the citizens group seeking to bring Home Rule back to Rockford, I cannot speak for the City Council and the Mayor as to how Home Rule would be used in specific terms. As the dialogue about Home Rule progresses, it should be clear to all that Home Rule is a toolbox with various tools that can be used to address local problems and local opportunities. It is not a “one size fits all” concept which can be adapted to deal with local situations. Will the City Council effectuate a plan to reduce property taxes? It is certainly within their power. This is a strategy which has been used by peer group committees such as Peoria, Springfield, Decatur, Normal, Champaign, Bloomington and Urbana among others.
We can fairly say that the first and perhaps most important benefit from bringing back Home Rule is the self esteem of our community when realizing what we can deal with our own problems while we reject the negativism that has pervaded our community for decades. At the same time the rest of the State will take note of our new re-established Home Rule status and will no longer be able to “negative sell” against Rockford when competing to recruit businesses. They would not longer be able to characterize Rockford as a regressive “luddite” community. At the same time the financial markets will take note and the Rockford bond rating will improve which will result in annual savings of interest for our community in the $75,000 to $100,000 range. The rest of the changes will come through the use of the Home Rule tools by our City Council and Mayor.