25 Jan 2012

Teachers across the nation work for their labor unions during school hours, with taxpayers covering much of the cost

By By Victor Skinner, EAG Communications
DENVER - Across the United States, taxpayer dollars are being used to subsidize the salaries and benefits of teachers and other municipal employees who work for their local labor unions.
This wasteful tradition costs taxpayers millions each year, and has gone largely unnoticed because the details of the arrangements are most often negotiated behind closed doors.
Luckily this practice, popularly known as "union release time," may be coming to an end in many parts of the nation.
Severe budget problems in California, Colorado, Arizona and other states have increased scrutiny on labor spending, with critics highlighting union release time as a disgusting waste of taxpayer money at a time when most schools and municipalities can least afford it.
Education Action Group has documented different forms of union release time in our reviews of teacher contracts in numerous states, and the issue has been probed in depth by researchers like Ben DeGrow of the Independence Institute's Education Policy Center.
Educators are often released from their regular duties with pay - either full-time, part-time or on a per-diem basis - to serve as union officials. They are free to use school time to handle grievances, attend collective bargaining sessions, lobby government officials, do political work, and perform other union-related activities.
Recent media reports from Denver and lawsuits filed in Arizona and California are bringing needed attention to the unnecessary expense, the first step in provoking corrective action.
The issue is coming to light most often in states and individual school districts with large budget deficits, including Colorado, where the Denver Post recently published a detailed report on union release time in the state's 20 largest districts.
The newspaper's findings confirmed what EAG and DeGrow have already exposed: taxpayers are subsidizing the state's wealthy and powerful teachers union by millions of dollars each year.
The ugly, expensive truth
Colorado's 20 largest school districts with union contracts spent a combined $5.8 million on salary and benefits over the past five years for school employees to work for their local teachers union, according to the Post.
The stipulations of the arrangements varied by school district - from full time off at full district expense to a set number of days with union reimbursement for a portion of the cost. In recent years, the most expensive agreements cost taxpayers in Douglas County, Adams 12, and Brighton 27 districts $1.3 million, $629,457, and $626,118, respectively.
The Denver Post found that only one of the 20 union contracts reviewed did not require the school district to spend tax money on release time for union business.
Colorado StateTreasurer Walker Stapleton put the issue in plain terms for the Post.
"It's a shame the money isn't getting into the classrooms and to students," he said. "It's another example of the stranglehold that unions have on education funding in Colorado."
Unfortunately, the problem extends far beyond the Centennial State.
EAG has documented union release time clauses written into teacher contracts in Michigan, New Jersey, Colorado, Indiana, California, Pennsylvania, Illinois, New York, Ohio and other states. In many cases, we submitted public information requests for the cost of this union perk, and the results ranged widely based on the details of the agreements and the size of the districts.
In Ohio's 18,000-student Lakota school district, for example, the local union president was granted half time off from teaching duties during the 2008-09 school year to work for the union at taxpayer expense. The union chipped in for a quarter of the expense, but the provision ultimately cost Lakota schools $38,000 in 2008-09.
At the Paterson school district in New Jersey, the union contract stipulates that the district must release several union officers from their school duties with full pay and benefits. Three district employees were released from their duties for the entire 2009-10 school year, and all were paid over $100,000 in salary by the district. The teachers union reimbursed Paterson schools for more than half, but taxpayers were left on the hook for $80,000.
We've also found expensive union release time provisions from contracts in Michigan and Indiana. The Rochester, Michigan district paid about $120,000 in total compensation for a teacher who worked full time as union president during the 2008-09 school year. The price tag was about $130,000 in the Troy school district, $50,000 in Ann Arbor, and $75,000 in Kalamazoo during the same school year.
Indiana's Fort Wayne schools subsidized its union president's compensation by nearly $25,000 in 2009-10.
The irony is that those same union officials use their paid release time to pressure school boards to increase salaries and benefits, and the financial burden on residents. It's a disgraceful circle of tax and spend that is leaving knowledgeable taxpayers dizzy and nauseous.
What makes matters worse is that many schools do not track the amount spent on union release time.
"It's bad enough that they pay for union release time at all, but to not even have a basic level of accountability, especially in these tighter budget times?" the Independence Institute's DeGrow told the Denver Post. "It's kind of appalling."
Getting tough
With school budgets drying up, the pressure has increased for district and labor officials to cut back or eliminate union release time. In Colorado's Douglas County, the district's new superintendent, Elizabeth Celania-Fagen, cut payments for the union leave nearly in half last year, and is expected to eliminate it altogether in the coming weeks.
"Going forward, my responsibility is to do what's right for our students in these economic circumstances and to be accountable for taxpayer dollars," she told the Denver Post.
Other Colorado school districts, including Aurora, Thompson and Adams 12, are phasing out the contract provision, as well.
In California, union officials in the Vista Unified School District agreed to pay $80,000 to settle a district lawsuit seeking reimbursement for $128,242 spent on union release time. Perhaps more importantly, the union promised to pay its own way in the future.
A lawsuit filed in Phoenix is challenging union release time for the city's seven labor unions. Phoenix's union contracts allow for more than 73,000 hours of annual release time for city workers to conduct union business at taxpayer expense, according to the Goldwater Institute, a non-partisan government watchdog organization behind the lawsuit.
The Institute is representing two city taxpayers, William Cheatham and Marcus Huey, who contend that the agreements violate the state constitution, which prohibits "using taxpayer dollars to subsidize private entities without proportionate, tangible benefits in return," according to the Institute.
Both examples illustrate that taxpayers are catching on to the union's free labor scheme, and we suspect that reports like those recently published in the Denver Post will only increase pressure to address it.
As more taxpayers become aware of the union subsidies, we believe most will come to the same conclusion as Clint Bolick, director for the Scharf-Norton Center for Constitutional Litigation at the Goldwater Institute.
"Taxpayer money would be used exclusively for public purposes," he said. "The practice of shoveling millions of taxpayer dollars into union coffers must be stopped."
Contact Victor Skinner at vskinner@edactiongroup.org or (231) 733-4202
23 Jan 2012

Braley Presses for Action on Yearlong Middle Class Tax Cut Extension

By Jeff Giertz

Urges House leadership to work together to extend payroll tax cut 

 

Washington, DC - Today, Rep. Bruce Braley (IA-01) wrote House Speaker John Boehner and House Minority Leader Nancy Pelosi urging them to work together to pass a yearlong extension of the middle class payroll tax cut.

In December, a yearlong middle class tax cut extension became mired in partisanship and Washington gridlock.  After weeks of stalled negotiations and scorched-earth tactics, a two-month temporary extension of the middle class tax cut was ultimately passed.

"In less than two months, the short-term middle class tax cut extension will expire.  If Congress doesn't start working together now, we'll be in the same situation we were at the end of December: a partisan shouting match.

 

"Enough is enough.  Let's start working together now to extend the middle class tax cut and restore certainty for middle class families.  A yearlong extension will put $1,000 in the pocket of the average middle class family and help strengthen the economy.  America's middle class can't afford to wait until the last minute."

 

Braley has consistently worked across party lines for a yearlong middle class tax cut extension.  He was one of only 10 Democrats to support a Republican bill to couple a yearlong extension of the middle class tax cut with other provisions.  Braley also supported the compromise Senate bill that extended the middle class tax cut until the end of February.

Text of Braley's letter is below; a copy of Braley's letter can be downloaded at the following link: http://go.usa.gov/niP

 

--

 

January 23, 2012

 

The Honorable John Boehner                       

Speaker

U.S. House of Representatives               

H-232, U.S. Capitol                       

Washington, DC  20515                         

 

The Honorable Nancy Pelosi

Minority Leader

U.S. House of Representatives

H-204, U.S. Capitol

Washington, DC  20515

 

Dear Speaker Boehner and Minority Leader Pelosi:

Please work together to extend until the end of the year the payroll tax cut that is set to expire at the end of February. This issue is far too important for our country's economic recovery to let politics stand in the way.

This middle class tax cut is essential for job creation and our economic recovery. Extending this middle class tax cut will keep nearly $1,000 in the pocket of the average family and 160 million Americans would benefit from extending this tax cut. That's money a family can keep to spend on groceries, clothes, utilities, etc.  This tax cut puts money back in the pockets of middle class families that will help spur demand and economic growth.

Both political parties shamefully used this issue as political leverage when we tried to extend the payroll tax cut in December, but continuing this tax cut is more important than Washington politics. This issue shouldn't be about Republicans and Democrats - it's good for our economy and it's good for Americans. It's time for Congress to finish the job.

We're facing some tough times, and people in this country are desperate for leadership.  They don't care about labels, they care about results.  Americans don't want to see political point-scoring and game-playing in Washington.  They want to see people come together to solve problems.  Both parties generally support the idea of extending this middle class tax cut.  It shouldn't be so hard to get this done.

Please stand up for American families by extending the payroll tax cut. Now is not the time to leave them hanging. I stand ready to work in any way possible to help make a year-long extension of the middle class tax cut a reality.

Sincerely,

 

Bruce Braley,

Member of Congress

 

# # #

23 Jan 2012

Washington Post: Simplifying regulations is not so simple

By Jeff Giertz

In case you missed it...

...there's another way to simplify regulations that may attract more consensus. Rep. Bruce Braley (D-Iowa) introduced a bill this week that would require that all federal regulations be written in clear, simple language that their intended audience can understand, reducing compliance costs for the private sector. He helped pass a similar bill last year to promote plain language in government, but it didn't touch regulations.

"Sadly, gobbledygook dominates the regulations issued by government agencies, making it almost impossible for small businesses to understand the rules of the road," Braley said in a statement about the bill.

The congressman offered an example of that "gobbledygook" when I interviewed him this week: The 300-page Volcker Rule, he said, "seems excessive to me," arguing that regulators trained in plain language would be able "to produce a document that's much simpler and much easier to understand."

Simplifying regulations is not so simple

Washington Post

1/19/12

Opponents of government regulations typically complain about the burden they impose on private-sector firms that have to comply with them, burden that they say dampens economic growth.

Part of that burden has to do with the sheer complexity of the regulations themselves, especially when taken together as a whole.

One financial industry consulting firm describes that web of regulatory mandates as a "complexity risk." In a new industry report flagged by Joe Nocera, the consulting firm Federal Financial Analytics argues that "the sum total of all the U.S. and global rules aimed at preventing financial crises" can end up having unintended consequences.

The study points out that both regulators and industry players tend to look at regulations in a "silo" fashion, without considering how the individual parts may overlap, contradict or otherwise work against each other. Federal Financial Analytics emphasizes that it doesn't oppose many of the new regulations, per se, but that many critical pieces need to be streamlined.

For example, the firm proposes creating "a more uniform capital framework" to make it easier for firms to comply with new U.S. and global capital standards. It also wants CEOs to be responsible for monitoring only risks that truly threaten their own firms or the financial system instead of "the minutiae."

But there can be big differences between how regulators and industry leaders would simplify byzantine regulations. The suggestion to reduce the number of risk factors that bank chiefs are responsible for monitoring which might concern regulators. But giving more discretion and power to regulators would likely concern industry. And finding a compromise between the two can often make a law even more complex.

Federal Financial Analytics blames such regulatory complexity on "over engineered standards" produced by a host of expert regulators. But industry lobbyists are also driving these deliberations to carve out exceptions if things aren't moving in their direction. As a result, achieving "simplicity" can be harder than it sounds in the abstract.

That said, there's another way to simplify regulations that may attract more consensus. Rep. Bruce Braley (D-Iowa) introduced a bill this week that would require that all federal regulations be written in clear, simple language that their intended audience can understand, reducing compliance costs for the private sector. He helped pass a similar bill last year to promote plain language in government, but it didn't touch regulations.

"Sadly, gobbledygook dominates the regulations issued by government agencies, making it almost impossible for small businesses to understand the rules of the road," Braley said in a statement about the bill.

The congressman offered an example of that "gobbledygook" when I interviewed him this week: The 300-page Volcker Rule, he said, "seems excessive to me," arguing that regulators trained in plain language would be able "to produce a document that's much simpler and much easier to understand."

18 Jan 2012

Braley Introduces Bill to Streamline Regulations, Save Small Businesses Money

By Jeff Giertz

Plain Regulations Act would require government rules be written in clear, concise language

 

Washington, DC - Today, Rep. Bruce Braley (IA-01) introduced a new bill - his first of 2012 - to streamline government regulations in an effort to save small businesses time and money.

The Plain Regulations Act would require the government to write new and updated regulations in clear, simple, easy-to-understand language.

"Whether you like or loathe government regulations, I think everyone can agree that when they exist they should be written as clearly as possible," Braley said.  "Sadly, gobbledygook dominates the regulations issued by government agencies, making it almost impossible for small businesses to understand the rules of the road.

 

"The Plain Regulations Act would simplify rules, saving small businesses time and freeing up money that can be better used investing in growing the business and creating jobs."

 

The costs to small businesses of complying with government regulations are significant.  The National Small Business Association has estimated that businesses with less than 20 employees pay an estimated $7,600 per employee to comply with regulations.

"Simplifying regulations won't eliminate the costs of compliance, but it will reduce them.  And it's an easy way to save small businesses money that can quickly attract bipartisan support."

 

Examples of lengthy, overly complex regulations abound.  As part of the Affordable Care Act, the Department of Health and Human Services recently published a 189 page rule outlining the requirements for doctors to form Accountable Care Organizations.  Doctors have complained that the regulations are too complex and convoluted for them to understand.

 

Braley is known for his efforts to simplify government writing.  In 2007, Braley launched a three-year effort to require the government to write forms and documents like tax returns in easy-to-understand language with the introduction of the Plain Writing Act.  The bill was signed into law by President Obama in 2010, and improves the accountability of the federal government by promoting clear communication that the public can understand and use.  The law went into effect in July of 2011.

# # #
18 Jan 2012

International Traders of Iowa- Eastern Iowa Chapter (ITI-EIC)

By Dee Freeman
The International Traders of Iowa, Eastern Iowa Chapter, is holding and information and membership meeting on Tuesday, February 7th from 5:30 - 7:30 at the Clarion Hotel and Convention Center, 525 33rd Ave. SW, Cedar Rapids IA 52404.

To kick off our membership event, special Corporate membership pricing is available for only $100 through March 15. (A savings of $50!) Discounted Student Pricing Available! We will be holding a drawing to give away one (1) free corporate membership, and one (1) voucher for a free meeting.   Bring your business cards!


Questions and RSVPs can be directed to:
Deanna (Dee) Freeman, President, 319-295-2490, dlfreem1@rockwellcollins.com
Melissa Jones, Vice President, 319-393-4310, melissa@espint.com
Or visit www.iowatraders.com for more information.
18 Jan 2012

Ever wonder what it costs to quit a labor union?

By Ben Velderman
GRANT, Mich.  - Ever wonder what it costs to quit a labor union?
For one Michigan educator, the annual costs of "non-membership" in the local, state and national teacher unions total $544.28.
But Andrew Buikema, 10-year teacher with Grant Public Schools, is willing to pay the price, just for the privilege of being seen as a true professional, instead of a union worker.
Michigan is not a "right to work" state, which means Buikema's job is still affected by the district's contract with the local teachers union, the Grant Education Association. The GEA is affiliated with the Michigan Education Association and the National Education Association.
Buikema has been trying to leave the union since last spring, when he realized that GEA leaders were uninterested in helping the district control costs, even in the face of a multi-million dollar deficit.
By refusing to make wage and benefit concessions, the union contributed to conditions that led to 27 teachers - including Buikema - receiving layoff notices. The district was also forced into making cuts to student academic and extracurricular programs.
Buikema's job was saved at the last minute, but he was disgusted by the union's selfishness.
The union's intransigence convinced Buikema that "the union doesn't care about kids."
"They keep asking for more and more, even though the school district can't afford it," he told EAG. "They're concerned about taking care of the adults and have no consideration for the kids. I don't want to be part of an organization that says one thing and does another," he said.
Buikema said he was "raked over the coals" by his local union leaders when he suggested the GEA could help alleviate the district's financial woes - and possibly help save some teaching jobs - by switching from union-owned and operated MESSA health insurance to a less expensive carrier.
Buikema estimated that the district could save between $530,000 and $980,000 annually.
Not only did local union leaders not like Buikema's idea, but they verbally attacked him for even suggesting it. "The amount of flak I got, particularly from veteran teachers, was ridiculous to the point of being unprofessional," he said.
Buikema was also put off by the NEA's new $10 levy on members to help re-elect President Obama."It's the principle involved," Buikema said at the time. "They're taking money to support a candidate that members may or may not support. That's a very big deal."
Unions bury dissenters in pile of legal documents

Last summer, Buikema decided to cancel his union membership altogether. The MEA and NEA finally responded to his resignation request last month by sending approximately 150 pages of documents. The upshot of all those documents is this: Buikema can technically quit both unions, but he must still pay them $544.28 in "service fees," which equals 67.7 percent of a normal union membership.
"Dear Non-Member," the MEA letter begins, "You are employed in a bargaining unit represented by an affiliate of the Michigan Education Association. ... Your collective bargaining agreement contains a provision which requires you to join the association or to pay a service fee."
Another document explains that those service fees are based on "annual expenditures ... incurred for the purpose of performing the duties of an exclusive representation of the employees."
The unions claim the service fee only pays for activities that don't involve an "ideological cause or political activity unrelated to collective bargaining, contract administration, grievance adjustment and lawfully chargeable employee representation." A 64-page document breaks down all of the separate charges that go into the $544.28 fee, and explains how each is allowed under current law.
Yesterday, Buikema sent his own letter to the MEA:
"I am enclosing a check for $25 to the MEA, because that's what I can afford to do right now. You will receive the remaining balance as I am able to pay. ...
" ... Forcing teachers to join your organization and pay dues is criminal. What happened to free will and the right to choose? I am trying to get out of the union because you don't stand for kids.
" ... You send this massive packet of ... legal documents that I cannot decipher because I am not a lawyer ... to do what exactly? Scare me? Intimidate me? What you are proving is that you will go to great lengths to get people's money. ..."
As a non-member, Buikema has the legal right to contest any of the "service fee" charges, but it entails a long and complicated legal process. And the MEA and NEA are well-represented by lawyers and accountants, as the stack of documents makes clear. The implication is obvious: It is futile for an individual teacher to protest the hundreds of dollars in fees. "They're just going to make you pay anyway," Buikema concludes.
Buikema says some of his colleagues have expressed interest in also breaking away from the union, but are taking a wait-and-see approach. "Most teachers like to be safe and stay in their comfort zone," Buikema said. "I don't care about that."
Buikema has remained an outspoken union critic, and wants to be seen as a true professional whose worth is solely determined by his performance in the classroom, and not by his ranking on the seniority chart.
That won't truly happen until Michigan becomes a right to work state, and union membership is no longer compulsory. Until then, Buikema chooses to be a "non-member" and will pay $544.28 for the privilege.

-###-
17 Jan 2012

Governor Quinn Announces 100 New Jobs at Excel Foundry & Machine

By Nafia Khan

State Investment will Help Company Expand Operations,
Boost North Central Illinois Economy

PEKIN - January 17, 2012. Governor Pat Quinn today announced that Excel Foundry & Machine, a company located in Pekin, Illinois, plans to expand operations and create 100 new jobs over the next two years. The state's investment will help Excel, a manufacturer of bronze parts for the mining industry, expand its global footprint and boost economic development in North Central Illinois.

"Illinois' strong manufacturing tradition is due in large part to the strength of our workforce, our ability to help companies to move product quickly and our investments in infrastructure," Governor Quinn said. "Excel is one example of how supporting our small and mid-sized manufacturers continues to increase Illinois' competitiveness."

Excel plans to invest $7.4 million to construct a new 108,750 square foot warehouse adjacent to its existing plant, in addition to an 8,600 square foot addition to the main office and a 3,373 square foot addition to the foundry. The project will result in 100 new jobs in addition to its existing 230-person workforce.

The state is investing more that $1 million consisting of Economic Development for a Growing Economy tax credits, which are based on job creation, and an Employer Training Incentive Program grant to help enhance the skills of its workforce. The state's investment is contingent on the company meeting its investment and job numbers.

Tazewell County will also receive a $750,000 Community Development Assistance Program grant through the Illinois Department of Commerce and Economic Opportunity (DCEO), and more than $859,000 through the Illinois Department of Transportation's (IDOT) Economic Development Program for road improvements to accommodate the expansion.

"I am pleased that Excel will continue its  tradition of manufacturing excellence right here in Illinois," said DCEO Director Warren Ribley. "Through projects such as this, we are keeping our manufacturing sector strong, creating jobs for the future and supporting our long-term economic growth."

"Providing safe, reliable infrastructure is critical to protecting and creating jobs," said Illinois Transportation Secretary Ann Schneider. "We are proud to contribute to a project that will help a local company grow and invest in the community."

Illinois added 62,300 jobs in 2011 and 105,600 jobs since January 2010. Since January 2010, the state has added 18,200 manufacturing jobs.

For more information on why Illinois is the right place for any business, visit www.illinoisbiz.biz.

###
16 Jan 2012

President's proposal on U.S. trade agency consolidation

By Randy Stalsberg

Sen. Chuck Grassley of Iowa today made the following comment on President Obama's proposal to reorganize and consolidate U.S. trade agencies.

"The enactment of trade agreements has been a hard slog with the President.  Any reorganization that disrupts trade negotiations and expanded markets for U.S. businesses and farmers would cause me serious concern.  Consolidation that doesn't hurt export opportunities might make sense.  Congress will need to look at this proposal carefully.  It's not surprising that the President is focusing on this area for consolidation.  Trade is already a lower priority than it should be for this White House."
13 Jan 2012

Von Maur Department Store to Open Second Georgia Location

By Brendan Griffith

140-year-old Retailer Will Anchor Perimeter Mall in North Atlanta;

Move Continues Company's Strategic Expansion Throughout the Southeast

 

DAVENPORT, Iowa - January 11, 2012 - Von Maur Department Stores announced today its plans to open a 234,000 square foot store at Atlanta's Perimeter Mall in November 2012.  The store will be the Company's second location in Georgia and will become one of Von Maur's largest stores in the country.

Known for its outstanding selection of brand name and specialty apparel, shoes, accessories and gifts, the store will feature products from leading brands such as Eileen Fisher, Free People, Coach, Joe's Jeans and Tommy Bahama, among many others.  Located at the mall's former Bloomingdales' location, the three level Von Maur store will be completely renovated in order to feature the Company's signature residential ambiance, complete with antiques, original artwork, open-floor plan and music from the store's grand piano. It is expected that the store will eventually employ 275-325 full-time and part-time associates, the majority of which will be full-time.

Today's announcement marks the continuation of the family-owned Company's strategic growth, targeting select markets within and beyond its traditional Midwestern roots. Von Maur opened its first Southeast location at North Point Mall in Alpharetta, Ga., in November 2011, and has announced plans to open additional stores in Hoover, Ala., and Victor, N.Y., in Fall 2013.

"We're thrilled to become a part of the successful Perimeter Mall, and look forward to furthering our reputation as a retailer of choice for shoppers throughout Greater Atlanta and beyond," said Jim von Maur, president of Von Maur.

In addition to its selection of popular brands and merchandise, Von Maur is also widely-regarded for its superior customer service, including an interest-free charge card, liberal return policy, free gift wrapping and shipping services. The Company also offers its associates above-market wages, excellent benefits and a positive, professional work environment.

About Von Maur

Von Maur was founded nearly 140 years ago in downtown Davenport, Iowa. The Company currently operates 27 stores in 11 states. The Company also runs a successful online business at vonmaur.com, in addition to a new chain of women's specialty stores under the nameplate DRY GOODS.  For more information, please visit www.vonmaur.com.

# # #
10 Jan 2012

Governor Quinn Signs Legislation to Boost Tax Relief for Working Families

By Andrew Mason

Increase to Earned Income Credit and Personal Exemption
to Help Working Families and Stimulate Local Economies

CHICAGO - January 10, 2012. Governor Pat Quinn today signed major legislation to increase tax relief for working families across Illinois. Senate Bill 400 doubles the state's Earned Income Tax Credit (EITC) over two years, saving low-income workers an extra $105 million per year. The new law also benefits all Illinois taxpayers by improving the value of the personal exemption and indexing it to inflation. Throughout the fall veto session, Governor Quinn insisted that tax relief for working families be part of the package.

"One of the best ways to stimulate the local economy is to put more money in the pockets of working families," Governor Quinn said. "This law is a win for workers, a win for families and a win for employers that will support job growth across Illinois for years to come."

Senate Bill 400 provides the largest increase in Illinois' EITC since its inception in 2000, by phasing in a 5 percent increase over two years. The bill boosts the state's EITC from its current level at 5 percent of federal EITC, to 7.5 percent in tax year 2012 and 10 percent of federal EITC in tax year 2013. More than 2.5 million state residents benefited from the Illinois EITC in 2010.

Under the new law, a single mother with one child, earning minimum wage ($12,800 a year), will save $154 on her taxes. A married couple with three children earning $30,000 a year will save $199 on their taxes this year.

Uniquely pro-growth and pro-family, EITC is available only to those with earned income and provides incentive to work as well as much-needed tax relief to the lowest-income families. EITC also boosts local economies through increased consumer demand. A 2006 Brookings Institution study found that every dollar a family saves through this tax credit translates into $1.58 of activity in local economies.

SB 400 was sponsored by Sen. Toi Hutchinson (D-Olympia Fields) and House Majority Leader Barbara Flynn Currie (D-Chicago.)

"The tax relief contained in Senate Bill 400 will benefit every person who files a tax return in Illinois," Sen. Hutchinson said. "Working families for too long have had to deal with increasing expenses and stagnant wages. This legislation is an opportunity to provide meaningful tax relief."

"A fair tax policy should help low-income working families, and our expansion of the state's EITC will do just that," Rep. Currie said. "This credit rewards work, and will help families keep a roof over their head and food on the table."

Senate Bill 400 also improves the value of the standard personal exemption for all taxpayers in Illinois and ties its continued growth to the rate of inflation. The personal exemption will increase by $50 (to $2,050) in tax year 2012, and the value of the exemption will be indexed to the cost of living adjustment each tax year thereafter. The personal exemption change benefits all taxpayers, regardless of income.

Senate Bill 400 goes into effect June 1.

How to Benefit from the Earned Income Tax Credit (EITC)

To benefit from Illinois' EITC, also known as the Earned Income Credit (EIC), taxpayers must include it on their tax returns. The not-for-profit Center for Economic Progress (CEP) estimates that between 10 and 20 percent of eligible taxpayers did not file for EITC last year.

To help working families achieve the maximum savings on their taxes, the Illinois Department of Human Services (DHS) partners with the CEP Tax Counseling Project to provide free tax preparation assistance at tax assistance centers across the state. The services are provided free of charge to families making less than $50,000 annually and to individuals with yearly incomes under $25,000. More than 28,000 Illinois taxpayers filed returns through the program in the 2010 tax season, with more than $50 million in state and federal tax refunds returned to clients.

DHS also funds the Tax Assistance Program (TAP) which has 23 locations in Chicago and the suburbs. TAP recruits tax professionals to volunteer to assist low-income families. DHS also works with its clients and those who found jobs and have left DHS programs to educate them about tax preparation programs and ways to ensure they receive the maximum refund on their tax returns.

For more information on the Tax Counseling Project, contact the Center for Economic Progress in Chicago at 312-630-0273, or call the toll-free statewide number at 888-827-8511. For information on the Tax Assistance Program call 312-409-1555 or 312-409-4318 (Spanish).  Details are also available on the IDHS website at www.dhs.state.il.us and the Department of Revenue website at www.revenue.state.il.us.

 

Information about filing federal taxes on-line can be found at www.irs.gov.

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