HC0030 100TH GENERAL ASSEMBLY

LRB100 03911 HLH 13916 e

100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
HOUSE JOINT RESOLUTION
CONSTITUTIONAL AMENDMENT
HC0030

Introduced , by Rep. Thomas Morrison

SYNOPSIS AS INTRODUCED:

ILCON Art. IX, Sec. 12 new

Proposes to amend the Revenue Article of the Illinois Constitution. Creates the Taxpayer's Bill of Rights. Provides that the State, units of local government, and school districts must have referendum approval to: (1) enact a new tax, tax rate increase, valuation for assessment ratio increase for a property class, extend an expiring tax, or enact certain tax policy changes; or (2) incur certain obligations without adequate cash reserves. Contains provisions concerning emergency taxes. Contains provisions setting spending limits for the State, units of local government, and school districts. Effective upon being declared adopted.

HOUSE JOINT RESOLUTION

CONSTITUTIONAL AMENDMENT

RESOLVED, BY THE HOUSE OF REPRESENTATIVES OF THE ONE HUNDREDTH GENERAL ASSEMBLY OF THE STATE OF ILLINOIS, THE SENATE CONCURRING HEREIN, that there shall be submitted to the electors of the State for adoption or rejection at the general election next occurring at least 6 months after the adoption of this resolution a proposition to amend the Illinois Constitution by adding Section 12 to Article IX as follows:

ARTICLE IX

REVENUE

(ILCON Art. IX, Sec. 12 new) SECTION 12. TAXPAYER'S BILL OF RIGHTS

(a) This Section shall be construed to reasonably restrain the growth of government. All provisions are self-executing and severable and supersede conflicting provisions of State and local law. Other limits on revenue, spending, and debt incurred by districts may be weakened only by future voter approval. Individual or class action enforcement suits may be filed and shall have the highest civil priority of resolution. Successful plaintiffs are allowed costs and reasonable attorney fees, but a district shall not be allowed those costs and fees unless the suit against it is ruled frivolous. Revenue collected, kept, or spent illegally since 4 full fiscal years before a suit is filed shall be refunded with 10% annual simple interest from the initial conduct. Subject to judicial review, districts may use any reasonable method for refunds under this Section, including temporary tax credits or rate reductions. Refunds need not be proportional when prior payments are impractical to identify or return. When annual district revenue is less than annual payments on general obligation bonds, pensions, and final court judgments against the district, subsections (b) and (d) shall be suspended to provide for the deficiency.

(b) Beginning on January 1 of the first calendar year after this Section takes effect, districts must have voter approval in advance to:

(1) except as provided in subsection (a) or subsection (c), enact any new tax or tax rate increase, extend an expiring tax, or implement a tax policy change directly causing a net tax revenue gain to any district; and

(2) except for refinancing indebtedness of the district at a lower interest rate or adding new employees to existing district pension plans, issue bonds or other evidences of indebtedness that mature after the last day of the fiscal year in which they are issued without adequate present cash reserves pledged irrevocably and held for payments in all future fiscal years.

(c) Notwithstanding the provisions of subsection (b), a district may impose emergency taxes, subject to the following conditions:

(1) in the case of emergency taxes imposed by the State, a 2/3 majority of the members of each house of the General Assembly must declare the emergency and impose the tax by separate recorded roll call votes;

(2) in the case of emergency taxes imposed by a unit of local government or school district, a 2/3 majority of the governing body of the unit of local government or school district must declare the emergency and impose the tax by separate recorded roll call votes;

(3) emergency tax revenue shall be spent only after emergency reserves are depleted and shall be refunded within 180 days after the emergency ends if not spent on the emergency;

(4) a tax not approved on the next election date 60 days or more after the declaration shall end with that election month; and

(5) emergency property taxes are prohibited.

(d) Each district shall reserve 3% or more of its fiscal year spending, excluding bonded debt service, to be used for declared emergencies only. Unused reserves may be applied to the next year's reserve.

(e) The maximum annual percentage change in State fiscal year spending equals inflation plus the percentage change in State population in the prior calendar year, adjusted for revenue changes approved by voters after the effective date of this Section. Population shall be determined by annual federal census estimates, and such number shall be adjusted every decade to match the federal census.

The maximum annual percentage change in each local district's fiscal year spending equals inflation in the prior calendar year plus annual local growth, adjusted for revenue changes approved by voters after the effective date of this Section and reductions otherwise required under this Section.

The maximum annual percentage change in each district's property tax revenue equals inflation in the prior calendar year plus annual local growth, adjusted for property tax revenue changes approved by voters after the effective date of this Section and reductions otherwise required under this Section.

If revenue from sources not excluded from fiscal year spending exceeds these limits in dollars for that fiscal year, the excess shall be refunded in the next fiscal year unless voters approve a revenue change as an offset. Initial district bases are current fiscal year spending and property taxes collected in the first year after this Section takes effect. Future creation of district bonded debt shall increase, and retiring or refinancing district bonded debt shall lower, fiscal year spending and property tax revenue by the annual debt service so funded. Debt service changes, reductions, refunds, and voter-approved revenue changes are dollar amounts that are exceptions to, and not part of, any district base. Voter-approved revenue changes do not require a tax rate change.

(f) Referenda under this Section shall be decided at a general or consolidated election.

At least 30 days before an election at which a referendum under this Section will appear on the ballot, districts shall mail at the least cost, and as a package where multiple districts with referenda overlap, a notice addressed to "All Registered Voters" at each address of one or more active registered electors. The notice must contain the following title:

"NOTICE OF ELECTION TO (INCREASE TAXES)(INCREASE DEBT)."

In addition to the title, the notice shall include only the following information:

(1) the election date, hours, ballot title, text, and local election office address and telephone number;

(2) for proposed district tax or indebtedness increases, the estimated or actual total of district fiscal year spending for the current year and each of the past 4 years, and the overall percentage and dollar change;

(3) for the first full fiscal year of each proposed district tax increase, district estimates of the maximum dollar amount of each increase and of district fiscal year spending without the increase;

(4) for proposed district indebtedness, its principal amount and maximum annual and total district repayment cost, and the principal balance of total current district indebtedness and its maximum annual and remaining total district repayment cost; and

(5) two summaries, up to 500 words each, one for and one against the proposal, of written comments filed with the election officer by 45 days before the election; no summary shall mention names of persons or private groups, nor any endorsements of or resolutions against the proposal; petition representatives following these rules shall write this summary for their petition; the election officer shall maintain and accurately summarize all other relevant written comments.

Except by later voter approval, if a tax increase or fiscal year spending exceeds any estimate in item (3) of this subsection for the same fiscal year, the tax increase is thereafter reduced up to 100% in proportion to the combined dollar excess, and the combined excess revenue refunded in the next fiscal year.

(g) As used in this Section:

"District" means the State, any non-home rule unit of local government, and any school district.

"Emergency" excludes economic conditions, revenue shortfalls, or district salary or fringe benefit increases.

"Fiscal year spending" means all district expenditures and reserve increases except, as to both, those for refunds made in the current or next fiscal year or those from gifts, federal funds, collections for another government, pension contributions by employees and pension fund earnings, reserve transfers or expenditures, damage awards, or property sales.

"Inflation" means the percentage change in the Consumer Price Index for All Urban Consumers as issued by the United States Department of Labor.

"Local growth" for a non-school district means a net percentage change in actual value of all real property in a district from construction of taxable real property improvements, minus destruction of similar improvements, and additions to, minus deletions from, taxable real property. For a school district, it means the percentage change in its student enrollment.

SCHEDULE

This Constitutional Amendment takes effect upon being declared adopted in accordance with Section 7 of the Illinois Constitutional Amendment Act.