Home rule resolution: a first in Illinois history

Less than two dozen of about 1,000 full-time city employees attend Dec. 21 lecture by retired professor

Three issues were clear after the recent home rule lecture for city employees: voter trust in authority will be key in whether the power is approved; sales taxes will likely increase under home rule, while city property taxes decrease; but before that can happen, the issue has to be put on the ballot either by a City Council resolution or by gathering thousands of voter signatures on petitions.

If the Rockford City Council places the home rule question on the ballot by resolution Jan. 3, it would be a first in Illinois history.

These were the primary messages that emerged the evening of Dec. 21, from a two-hour presentation and question session by retired Northern Illinois University Professor James Banovetz. City officials described Banovetz as an “expert” on the use of home rule in Illinois.

The Illinois version of home rule was automatically granted to municipalities with populations of 25,000 or more people in the early 1970s after the state constitution was approved by legislators and voters. Among other powers, home rule grants broad authority to elected officials to find revenue sources to fund projects and pay for goods and services.

If home rule is approved in Rockford in 2006, Banovetz’s message suggests residents can expect a large increase in new powers that would be entrusted to city aldermen to address important topics and issues. And residents and non-residents could expect a large shift in city revenue sources, from property taxes to sales taxes and fees.

Making history by resolution

Before voters have the opportunity to consider the issue, the Rockford City Council Codes and Regulations Committee has to decide whether it wants to make Illinois history by being the first large community to recommend approval of a resolution that places the question on the ballot for voters. That vote by the committee is expected at its Jan. 3 meeting.

Regardless of the outcome, history is in the making.

Banovetz said from 1976 to 2001, the question of whether large municipalities should retain home rule power has been placed on the ballot 25 times. All 25 of those questions were put before voters by citizens who gathered the required number of signatures on petitions, which translates into thousands of signatures or 10 percent of the registered voters. In Rockford’s case, approximately 8,000 signatures would have to be collected.

Rockford is one of four Illinois communities that rejected home rule authority. Rockford voters failed in 1978 to rescind home rule, but were successful in 1983. According to Banovetz, the other cities that rejected home rule were Lisle in 1977, Villa Park in 1980, and Lombard in 1981.

When home rule was last on the ballot in Rockford in 1983, home rule opponents garnered approximately 10,000 signatures to put the question to voters. The effort was led by author and Rockford resident John Gile. They argued supporters should be subjected to the same process to avoid the appearance of a double standard.

According to Banovetz, none of those four large municipalities that rejected home rule has sought to return to that authority. The other 21 cities voted to retain their home rule authority.

Professing his neutrality on the controversial issue, Banovetz lectured a small group of approximately 30 aldermen, city staff and administrators on the topic. The city employs approximately 1,000 full-time employees.

Banovetz began his session by stating: “I have no opinion on the subject,” and disclosed that he was asked by city officials to present home rule “facts” to employees.

Core to Banovetz’s two-hour presentation and question session were 10 points that summarized the advantages of home rule, and three disadvantages. Most of the questions fielded by Banovetz were asked by one of the seven aldermen who attended the lecture.

Most of the time spent discussing the aldermen and administrators’ questions concerned the parameters, limitations and uses of home rule power. Aldermen who attended the lecture were: Joe Sosnowski (R-1), Pat Curran (R-2), Victory Bell (D-5), Bill Timm (R-9), Jeff Holt (D-11), Linda McNeely (D-13), and Dan Conness (D-14).

Economic development

One of Banovetz’s advantage points concerned economic development. He cited the acquisition of multiple private properties by the City of Normal for the Mitsubishi automobile factory. Banovetz claimed the car manufacturer would have never located there had Normal not used home rule power to acquire the land needed for the project from private property owners.

Rockford Mayor Larry Morrissey echoed that sentiment by asserting the new Lowe’s distribution center on Rockford’s far southwest side would have not been possible had multiple properties been needed for the facility.

“We almost lost Lowe’s without home rule,” Morrissey said.

City Attorney Pat Hayes said Normal used its home rule authority to acquire property to attract Mitsubishi.

Banovetz added: “Developers want to save time and acquire large tracts of land. …[But] nothing you can do with home rule today, you can’t do without home rule. It just might take longer and be more expensive. …Home rule units can negotiate more in private with landowners.”

Gile criticized such land acquisitions by saying the property owners should be able to deal directly with the developers and businesses that want their land, not a government agency that is functioning as a middleman and operative of the “privileged class.”

That very criticism has resonated loudly throughout the nation since late June when the U.S. Supreme Court upheld municipalities’ right to seize private property for economic development under eminent domain laws.

Eminent domain

The power for cities to more easily acquire land might not be a comforting thought to area residents who have had their properties recently seized under threats of eminent domain proceedings by local municipalities.

Three case studies in use of eminent domain by local authorities have been detailed in The Rock River Times since 2000. None involved the City of Rockford, but did involve former Rockford Mayor Doug Scott when he was the city’s state representative.

In that case, in 2000, Winnebago County controversially seized approximately 10 of 16 acres of land from Tom and Jan Ditzler. The County took the action under state “quick take” law for construction of a 4-mile extension of Springfield Avenue, which intersects with the location of the new Lowe’s distribution center at Montague Road.

Quick take is another form of eminent domain that allows government agencies to legally seize private property before agreeing on compensation with the landowner.

Scott was one of the sponsors of the legislation that made quick take law in the late 1990s. He was also mayor of Rockford from 2001 until last May after he was defeated by Morrissey in the spring election.

Quick take for the Ditzler land was controversial since the road went through an undeveloped wetland that critics said could not naturally support vehicles. As a result of the absence of a natural foundation, initial construction of the road sank several feet in 2000.

The same section of road over Kent Creek and an artesian well has cracked and sunk twice since being completed in 2002. The reconstruction efforts have necessitated the use of betonite rock to provide an artificial foundation for the road.

Betonite rock expands when it comes into contact with water, and is commonly used to seal abandoned wells.

Advocates of the Springfield Avenue extension predicted the road would pave the way for economic opportunities, such as the Lowe’s facility. Critics argued such economic development shouldn’t be achieved by undermining property rights.

The County settled with the Ditzlers in 2003 for $105,000 for approximately 10 acres, which left the family with about 6 acres.

At the time of the settlement, Tom Ditzler said: “I don’t think it’s fair, but I’m really tired of trying to fight

the system. There comes a time when you really get tired.”

Sales tax

If home rule is approved by voters in either the spring or fall election in 2006, Banovetz’s research suggests sales taxes will likely increase, while city property taxes decrease.

After Banovetz said most home rule communities derived more than half their revenue from sales tax, Jim Ryan, city administrator, claimed: “Fifty-three percent of the sales tax Rockford yields is from non-residents.” However, Ryan was unavailable to explain how that data was collected, and during what time period.

Banovetz argued that one of the advantages of home rule was the ability to spread the tax burden to non-residents use city roads, water, sewer and services, such as police and fire protection. Banovetz said possible revenue sources include a gas tax, wheel tax, food and beverage tax, hotel tax, amusement fees, utility tax, real estate fees, new vehicle tax and natural gas tax.

Rockford already has a 1 percent sales tax, telephone tax and hotel tax.

Raymond F. Wacker, professor of accountancy and taxation at Southern Illinois University (SIU), weighed in on the issue earlier this month by discussing the advantages and disadvantages of both property and sales tax systems. He has taught accounting and taxation at SIU for 17 years.

Wacker said one of the arguments against a funding shift from property tax to sales tax would be that it “would be harder on the poor.” He added that such a change would also “hit everybody rather than just homeowners,” and make avoiding the sales tax more difficult.

Wacker said one advantage of being a property owner is individuals can lower their federal and state income tax by claiming property on their tax returns. He also said a property tax “is less onerous on the poor,” even though the poor who do not own property, may indirectly pay property tax through increased rent.

Banovetz suggested that switching to sales tax is politically more acceptable because consumers and voters are less cognizant of the impact such a change would have on their economic condition.

“People don’t know. …Voters don’t factor in sales tax” when making choices, Banovetz said.

Morrissey said during an October interview that about 30,000 non-residents work in the city, but do not pay property taxes. Morrissey said staff are examining whether those individuals could pay more to support a property tax cut for residents.

In politicians, we trust

Supporters and critics agree that voter trust in authority will be the key in whether the power is approved in either the spring or fall election, if the issue is placed on the ballot.

The effort to put the question to voters has been led by the politically-connected and well-financed political action committee Empower Rockford. They argue approval of home rule would demonstrate much-needed trust in the actions of public officials.

Critics such as Gile are suspicious of Empower Rockford’s motives since all the money was generated, and the committee was formed, well before the April 2005 mayoral election. But home rule was not a campaign issue among the three mayoral candidates.

Three days after Morrissey won the election April 5, Wally Haas of the Rockford Register Star wrote in an April 8 column: “Morrissey told the Editorial Board last month that he wants to earn the voters’ trust and get things done before he would even consider home rule.”

The Register Star is a financial supporter of Empower Rockford. They contributed $3,500 to the committee on Dec. 6, 2004.

Given the comment in Haas’ article, Gile wonders what happened to Morrissey between election day and Oct. 12, when Empower Rockford launched its home rule campaign.

Morrissey said in October the election was his mandate to ask voters for home rule.

Gile said the timing of the contributions to Empower Rockford, and the members of the committee indicate regardless of who was elected mayor, the group would have pushed the home rule agenda.

Even Banovetz has concerns about trusting some public officials and municipalities.

“There are some communities I would shudder if they had home rule authority because of the state of their public officials,” Banovetz said. He singled out Cook County as an example.

Banovetz also said if home rule is approved, Rockford residents would also give up their voice in referenda such as the road construction and maintenance questions. That duty would also be given to the City Council under home rule.

Banovetz conveyed his information and answered questions for more than two hours Dec. 21 at an evening meeting in the auditorium at the University of Illinois College of Medicine at Rockford, 1601 Parkview Ave. He is expected to return Jan. 18 between 6:30 p.m. to 8:30 p.m. for a similar session with the public in the same auditorium.

Gile wants to debate Banovetz in that forum.

From the Dec. 28, 2005-Jan. 3, 2006, issue

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