Chicago prepares for yet another telephone tax hike

Chicago prepares for yet another telephone tax hike

Chicagoans already pay the highest in the nation 911 surcharge and a newly passed bill would raise that rate even higher.

Chicagoans could be in for yet another tax hike.

Chicagoans pay a $3.90 per telephone line 911 surcharge, and new legislation out of Springfield might tempt local politicians to raise that rate even further.

Hidden in a larger telecommunications bills is a provision that would allow Chicago to raise 911 fees charged on every phone line by $1.10 per month.

Senate Bill 1839, which passed May 31, would increase 911 fees for the state to $1.50 from $0.87, and would allow Chicago to increase its 911 fees to $5 per month per line from $3.90. The City Council would need to pass a tax increase to act on this new authority.

A city spokeswoman said that the city needs this tax increase for “needed modernizations and operations at our 911 center,” according to the Chicago Tribune. But the city completed an overhaul of the 911 center as recently as 2013. Additionally, the city raised the 911 surcharge in 2014 to help pay for rising pension costs.

When the 2014 increase occurred, Budget Director Alexandra Holt said it would allow the city to free up $50 million in general revenue dedicated to the 911 system. The telephone tax was viewed as the favorable alternative to hiking property taxes (which ultimately happened anyway, after Mayor Rahm Emanuel and city aldermen faced reelection in the 2015 municipal elections). It was sold as a modest increase to upgrade the city’s 911 center and free up general funds to make increased payments to the city’s municipal workers’ and laborers’ pension funds, as the pension-reform plan requires. In all, this is simply another shell game the city is playing and taxpayers are expected to shoulder more to make up for the city’s inability to properly budget.

At a time when Chicago and Cook County are experiencing the largest population loss in the country, the City Council should not be looking to increase an already exorbitant tax burden. Instead of nickel and diming Chicagoans, the city should be looking at reforms like introducing a 401(k)-style alternative to failing city pension funds, addressing city spending and eliminating tax increment financing districts. Until true reforms are enacted, the city will continue to see its residents flee for greener pastures.

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