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The following issues represent the 2005 legislative priorities for the Metropolitan Mayors Caucus. In keeping with our mission statement, they deal with challenges that impact the quality of life for over 8 million people in our 272 municipalities.
We have listed the consensus positions adopted by the Caucus and its partner organizations on each important issue. We intend to be strong advocates for their adoption whether at the federal, state and/or local levels of government.
Reauthorization of TEA-21 | Electronic Commerce and Telecommunications | CDBG Funding | Municipal Revenues and Unfunded Mandates | Education Reform and Property Tax Relief | Reorganization of CATS and NIPC
Reauthorization of TEA-21 The leadership of the 109th Congress has indicated that they hope to pass legislation that reauthorizes funding for federal transit, highway and safety programs in the spring of 2005. The most recent funding legislation – the Transportation Equity Act for the 21st Century (TEA-21) – expired on September 30, 2003. It has been continued through several short-term extensions, with the current extension set to expire on May 31, 2005.
The 272 Mayors of the metropolitan Chicago area welcome the leadership’s desire to act quickly. Given the nation’s uncertain economy, it could not come at a more critical time. A major investment in highway, transit and rail systems will help stimulate economic growth. It will create jobs, promote business development and help ensure that cities, towns, regions and states across the country will be able to thrive.
The Metropolitan Mayors Caucus has identified the following strategic principles that its member Mayors recommend be included in any reauthorization legislation:
- Increase federal funding levels overall to meet critical needs for rehabilitation
and new capacity.
- Increase Illinois’ share of formula-driven funds.
- Preserve the basic structure of TEA-21 in the reauthorization legislation.
- Ensure adequate CMAQ funding for northeastern Illinois.
- Maintain the firewalls and guaranteed funding levels for transit, highway and safety programs.
- Continue the cooperative sub-allocation of funds to municipalities, counties and transportation agencies through metropolitan planning organizations (MPOs).
- Maintain TEA-21’s innovative programs, such as flexible funding provisions.
- Provide funding support for the Chicago Region Environmental and Transportation Efficiency Project (CREATE), an initiative that will help resolve freight rail gridlock in the region.
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Electronic Commerce and Telecommunications In 2002, 35 states – including the State of Illinois – ratified the Streamlined Sales and Use Tax Agreement, which substantially simplifies state and local sales tax systems, removes the burdens to interstate commerce that were of concern to the U.S. Supreme Court, and protects state and local sovereignty. This Agreement provides states and local governments with a blueprint to create a simplified sales and use tax collection system that when implemented, allows justification for Congress to overturn the Bellas Hess and Quill decisions.
The Metropolitan Mayors Caucus calls upon Congress to grant to those states that comply with the Agreement the authority to require all sellers, regardless of location, to collect the relevant state and local sales and use taxes. By granting this authority, Congress will ensure the viability of the sales tax as a state and local revenue source. It will also level the playing field between Internet and “brick and mortar” retailers.
The Mayors Caucus also believes that the same principles that have guided the streamlined sales tax project should also be applied to the discussion regarding telecommunications taxes. Government tax systems should treat telecommunications services in a competitively neutral and non-discriminatory manner. The federal government and the telecommunications industry should work with states and local governments to ensure equal treatment of all forms of telecommunicating. Furthermore, they should not impede state and local government efforts to achieve simplification and uniformity through the streamlining of state and local telecommunications tax systems.
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CDBG Funding The Bush Administration has indicated that it intends to consolidate eighteen community and economic development programs into one in the President’s proposed budget for FY 2006. The new program, which will be called the “Strengthening America’s Communities Initiative” will be funded at $3.71 billion according to the White House Office of Management and Budget.
The eighteen programs that are being considered for consolidation received $5.3 billion in FY 2005. One of them is the Community Development Block Grant program (CDBG). It received $4.7 billion in FY 2005. Early reports from Washington have indicated that the President’s proposed FY 2006 budget could cut CDBG funding by as much as 50 percent.
The Metropolitan Mayors Caucus is opposed to the proposed budget cuts in the CDBG program. The CDBG program was created to address the unique needs of urban areas as well as residents with low or moderate incomes. Reductions as significant as those being proposed will have a severe impact on those programs that help our poorest and neediest citizens.
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Municipal Revenues and Unfunded MandatesIt is estimated that the State will face a budget deficit of $1.5 billion to $2.0 billion for fiscal year 2006. This means that the Governor and State legislators will enter a third consecutive spring legislative session faced with the challenge of coming up with a combination of spending controls and revenue enhancements to bridge yet another major budget gap.
Governor Blagojevich has stated that he will not support increases in either the income tax or sales tax as part of the solution to the budget crisis. Aside from that, he has said everything else is on the table. It is once again imperative, therefore, that mayors and other municipal officials work together through the Metropolitan Mayors Caucus to protect their communities against efforts in Springfield to erode local revenue sources. They will also have to guard against possible new fees such as those that were created and imposed on them as part of the budget fixes of the last two years.
The State has also been known to impose unfunded mandates on local governments in the past to solve budget shortfalls. The Mayors Caucus is opposed to any legislation or regulation that creates unfunded or under funded mandates.
State mandates are intrusive and costly. Every time the State imposes a mandate upon local governments it is asking them to either cut services or raise local taxes in order to pay for them. The Mayors of the Chicago region are extremely concerned that the State may choose to expand the use of mandates as one means of dealing with this year’s budget deficit. We strongly urge them not to exercise this option.
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Education Reform and Property Tax Relief The Mayors of the Metropolitan Mayors Caucus share a commitment to a quality education system in Illinois. But they also share a concern that, despite the progress of recent years, the State still does not meet its full obligation to fund public education. As a result, many students and schools continue to struggle. In addition, property taxpayers continue to carry a disproportionate burden for funding education.
Numerous organizations now and in the past have pushed the Governor and General Assembly to reform the education funding system. These efforts have died quickly because they have focused only on generating additional revenues. The Mayors Caucus believes that property tax relief and fiscal and performance accountability measures need to be a part of any reform package or we will see a repeat of previous failed efforts.
Working in collaboration with the suburban Councils of Governments and the City of Chicago, the Mayors of the Chicago region have adopted the following guiding principles which are intended to serve as a framework for developing statewide consensus for education reform and property tax relief:
- The State should work with local boards of education to improve academic and fiscal accountability, management practices and cost control efforts.
- The State needs to develop an accountability system and stick with it.
- A significant portion of all new State revenues should be directed to providing greater funding assistance to under-funded school districts.
- The State should fund at least 51 percent of the education foundation level.
- All State mandates that trigger costs in excess of the foundation level should be funded by the State.
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Reorganization of CATS and NIPC Legislation is expected to be introduced during the Spring 2005 Session which will propose that the duties and functions of the Chicago Area Transportation Study (CATS) and the Northeastern Illinois Planning Commission (NIPC) be consolidated into a single new agency called the Regional Planning Board. The Mayors Caucus agrees with the overall goal of this legislative proposal, which is to improve transportation and land use planning in the Chicago region. However, it reserves judgment on how this can be accomplished until a comprehensive study of this issue is completed by a Coordinating Committee made up of the officers of the two affected agencies. The deadline for the Committee to submit a draft final report is June 30, 2005.
The original idea to consolidate CATS and NIPC was raised last spring by the State Regional Transportation Task Force that was chaired by then Congressman William O. Lipinski. While the Task Force recommended the merger of the two agencies, it did not provide any direction on the mission of the new agency, its management structure, its organizational goals and objectives, or how it would be funded. The Coordinating Committee will explore these issues as well as other operational and logistical questions that should be addressed before any merger or other reorganization could feasibly take place.
The Mayors Caucus believes that changes to the existing transportation and planning structures should not be made just for the sake of change. Rather, if there are to be changes, they should result in:
- improved coordination of transportation and land use planning in the Chicago region;
- expanded leadership roles for Mayors in any revised governance structures;
- continued local control over local planning decisions;
- improved transit service for the residents of the metropolitan region; and
- increased operational efficiencies and economies of scale.
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