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LGDF week 1 graphic2 (004)January 25, 2022: Village of South Elgin Supports Illinois House Bill 4169

State representatives in Springfield are currently reviewing legislation that directly benefits local governments including the Village of South Elgin. House Bill 4169 seeks to amend the Illinois Income Tax Act and return 8% of the collected state income tax to municipalities for funding local public safety and infrastructure needs.

The Village supports House Bill 4169 for multiple reasons:

  1. Historically (for the past 50 years), Illinois municipalities received 10% of the state income tax for local projects/needs, however in 2011 this amount dropped to 6.06%. House Bill 4169 would boost the amount to a fixed rate of 8%, thereby providing additional revenue to South Elgin in the range of several hundred thousand dollars annually.
  2. These funds, known as Local Government Distributive Funds (LGDF), would remain in our community. LGDF funds are mandated for public safety and infrastructure projects such as additional police staffing, road repairs, park upgrades and other projects benefiting the entire Village.
  3. LGDF funds are derived from income tax dollars already paid by South Elgin residents and businesses. While we understand a large portion of income tax supports statewide initiatives, re-capturing 8% of those funds (as opposed to 6.06%) would help the Village tackle rising infrastructure costs.
  4. House Bill 4169 enjoys bi-partisan support among Illinois State Representatives and an endorsement from the Metro West Council of Government serving approximately 40 communities in the Fox Valley/West Suburban area.

What Residents Can Do:

South Elgin residents and business owners are welcome to contact our Illinois House Representatives to encourage passage of House Bill 4169.

Full details about House Bill 4169 are available here: https://www.ilga.gov/legislation/BillStatus.asp?DocNum=4169&GAID=16&DocTypeID=HB&SessionID=110&GA=102

Synopsis of the proposed House Bill 4169: Amends the Illinois Income Tax Act. Provides that an amount equal to the sum of (i) 8% of the net revenue realized from the tax imposed upon individuals, trusts, and estates and (ii) 9.11% of the net revenue realized from the tax imposed upon corporations shall be deposited into the Local Government Distributive Fund (currently, an amount equal to the sum of (i) 6.06% of the net revenue realized from the tax imposed upon individuals, trusts, and estates and (ii) 6.85% of the net revenue realized from the tax imposed upon corporations shall be deposited into the Local Government Distributive Fund). Amends the State Revenue Sharing Act to provide that amounts paid into the Local Government Distributive Fund are appropriated on a continuing basis. Effective July 1, 2022.