Cook County must still cut spending to fix budget woes

 
Posted11/22/2017 1:00 AM
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  • Chris Lentino

    Chris Lentino

By Chris Lentino

Guest columnist

Cook County government employs nearly 6,000 fewer workers today than it did in 2001.

So how did the county's payroll costs grow by $300 million? It's simple: We're paying much more money for far fewer workers.

In the face of yet another budget shortfall, Cook County Board President Toni Preckwinkle tried to ram a widely unpopular sweetened beverage tax down residents' throats, claiming she needed the money to prop up the unstable budget. Tax hikes can't continue to be the answer to Cook County's ongoing budget crisis -- taxpayers are tapped out, and new taxes or tax increases won't fix what ails the county.

That starts with looking at major cost drivers. Cook County's budget in 2018 is slated to be $5.36 billion. That's nearly $500 million more than last year. This growth, over time, can be directly attributed to payroll growth.

Since 2001, Cook County payroll has grown, in total, 57 percent or an average of 3 percent annually per worker. Meanwhile, the Cook County median household income has grown by an average of only 2.2 percent per year over the same time. That means the average Cook County worker salary grew 1.5 times faster than the income of the typical household.

This payroll growth exposes a larger problem that unchecked payroll growth exacerbates: the ever-growing pension crisis in Illinois. As salaries grow at a rate faster than those of residents, employees have secured themselves higher pensions. More than 2,200 Cook County workers receive salaries over $100,000 thanks to these generous increases. For career county workers, that means pensions worth millions of dollars over the course of their retirements. And taxpayers are left on the hook for these benefits, too. The Cook County Employee Fund alone owes at least $6 billion in unfunded pension debt today.

Some Cook County politicians, including Preckwinkle, are going to try to sell the narrative that the county needs to raise taxes to fix the problem. But instead of piling on residents who already face one of the highest combined tax burdens in the nation, the Cook County Board should find real solutions to this fiscal crisis. The board voted 17-0 on Tuesday to pass a budget that just scrapes by with some superficial cuts, but county residents aren't out of the woods. Tax hikes are still a part of the conversation for future budgets, but it will take real reforms to fix the county's financial crisis.

A good first step would be to modernize the county's retirement system following Illinois' State Universities Retirement System model. That means implementing 401(k)-style retirement plans for all new county workers, with an option for current workers to join if they wish to, and an offer to existing employees to join that plan as well.

Residents rebelled against an ineffective and intrusive soda tax. Hopefully, it's the last straw for taxpayers who are fed up with bailing out government. Until Preckwinkle gets serious about addressing spending growth, taxpayers should be wary of calls for more revenue.

County officials have relied on higher taxes and fees to provide increased benefits to government workers. But is it fair to taxpayers? Given the already exorbitant tax burden shouldered by Cook County residents, the answer is a resounding "no."

Chris Lentino is a policy and outreach staff member for the Illinois Policy Institute.

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