Cost of living cuts Illinois too deep

Illinois is often the butt of jokes about government corruption and terrible weather, yet it is still the fifth most populous state in the country, according to the U.S. Census Bureau. However, that may change, considering that an April 30 Gallup poll found 50 percent of Illinois residents would move if they could, and 19 percent of current residents have plans to leave the state within the next year.

The most common reasons for wanting to move were work- and weather-related, but a significant number of respondents also cited cost of living and high taxes. Although Gov. Pat Quinn and Mayor Rahm Emanuel can’t do anything about the weather, the Illinois and Chicago governments could reduce sales taxes and implement rent caps to encourage young families to stay.

Illinois residents pay some of the highest sales and property taxes in the nation—on normal sales items without added dues, the Chicago sales tax clocks in at 9.25 percent, according to the Illinois Department of Revenue. The 2014 state income tax is 5 percent, the fourth highest flat rate income tax in the nation. Combining state and municipal taxes, Illinois ranks 10th in the nation for sales taxes, according to Washington, D.C. think tank the Tax Foundation.

While the taxes are high, simply slashing them is a shortsighted solution. Higher taxes afford Illinois residents better social services, such as a better-maintained highway system than in states with lower taxes.

But the relative value of living in Illinois and Chicago could change if the city does not put a cap on how high taxes climb. In 2012, the city hiked its cigarette taxes by $1, making it the highest taxer on cigarettes in the nation, as reported Jan. 28, 2013 by The Chronicle.

The state still needs significant tax revenue to alleviate the looming pension crisis, but lowering taxes and, in turn, the cost of living could encourage Illinois residents to reevaluate their negative views of the state. Studio apartments for $700 per month are a fond memory. Chicago is one of the only metropolitan areas in the country without rent control, a law that sets a limit on how high landlords can raise rent. The absence of a rent control law allows landlords to raise the rent as high as they see fit, often chasing lower-income tenants out. The city needs to implement rent control to protect residents who could get fed up with escalating rent payments and decide to clear out. Of course, landlords sometimes need to raise rent to compensate for the cost of upkeep and increased bills such as electricity, but they should not be allowed to raise it by unreasonable margins each year. If the city implements rent control, it should stipulate a maximum percentage that property owners can raise the rent every 2–3 years, but there should also be a ceiling for how high landlords can raise rent based on the assessed property value.

The government also needs to focus on attracting young professionals because as the baby boomer generation grows older and retires, young people need to fill the jobs they leave behind. But if Illinois discourages young couples from starting families in Illinois because of high property taxes and a poorly functioning school system, the state’s economy will suffer.

From 2002–2012, Illinois teacher salaries fell 9.5 percent, according to the National Education Association, likely discouraging teachers from moving here. Enrollment statewide fell 0.2 percent from fall 2011–2012. Chicago Public Schools has been the subject of international scrutiny for the city’s decision to close 50 schools last summer, and if the city and state do not improve their school systems, young couples will simply pick up and move elsewhere in search of better public schools.

While those unhappy with the weather and the scenery will likely move anyway, the rest could be convinced to stay if the cost of living and quality of life were improved. Government officials need to look at how tax decisions impact the future of the state and balance reasonable cost with effective governance.