Cook County Board President Toni Preckwinkle on Thursday proposed a controversial one-penny-an-ounce tax on sweetened soft drinks as part of her $4.4 billion 2017 county operating budget.
Preckwinkle says the tax is necessary to help avoid devastating layoffs and close a $174.3 million budget shortfall for next year.
“We’ve had to make a number of difficult decisions to create a balanced budget that provides essential public safety and public health services to county residents while being fiscally responsible,” Preckwinkle in remarks prepared. “Over the last six years, we have made important strides toward stabilizing the County’s financial outlook by making these kinds of hard choices, including reducing our staff by nearly 10 percent. We will continue confronting our problems aggressively and make the tough but necessary decisions so we are not passing today’s problems to future generations.”
The soft-drink tax is part of a plan, Preckwinkle said, to avoid “more than 1,000 layoffs over the next three years, including prosecutors, public defenders, sheriff’s deputies and critical support staff.”
That tax, first reported in the Sun-Times, would cover carbonated soft drinks, sports drinks and energy drinks. Fruit drinks also would be taxed, but 100-percent fruit juice is exempt.
In recent weeks, after word of the proposed tax leaked out, merchant groups called it bad for business growth in Illinois and one that would hurt cash-strapped families. Ads slamming the tax have aired.
Even with the additional revenue, Preckwinkle said she is planning to lay off about 300 county employees in 2017.
She said the county has been hampered in raising revenue by: the gridlock in Springfield; “growing legacy debt service costs”; many “flat or declining revenue streams”; and increases in technology spending needed to update “antiquated” systems.
As part of the soft-drink tax hike, Preckwinkle said she is pledging — in the form of a resolution — not to raise any other taxes for “at least the next two fiscal years.”
“This should assure our residents that we mean what we say, and that we are adding a revenue component to this budget only as a last resort while supporting critical programs and pursuing a sound, long-term financial strategy, something the county has not always entertained,” Preckwinkle said.
The new tax, which would be effective July 1, 2017, is expected to provide about $74 million in revenue. The county would use the money raised to double its investment in “community-based anti-violence efforts and avoid layoffs in the public safety arena,” county officials said.
Preckwinkle is also considering demolishing “old or underutilized” parts of the Cook County Jail.
“By demolishing underused and antiquated divisions at the jail, we will reduce our campus foot print by 550,000 square feet, avoid more than $172 million in required capital improvement costs and save $3 million in annual operation costs. We are also continuing our work to shrink our real estate footprint by more than 1 million square feet by closing one of our three warehouses in the coming year,” Preckwinkle said, according to her prepared remarks.