By WMBD TV
PEORIA, Ill. (WMBD) — State Sen. Dave Koehler, an assistant majority leader in the Senate, said lawmakers eventually must solve the over-reliance on property taxes to fund education.
“Illinois has one of the lowest percentages of state funds that go to education in the county and that’s because we really rely on property tax to fund education,” said the Peoria Democrat. “We’ve got to turn that around. Our property tax situation in Illinois is not sustainable.”
Property tax relief has usually been touted by Republicans, who are in the minority. They have tried to come up with statewide solutions, but they often fail to make it out of the rules committee, which kind of like the bill graveyard.
Koehler said since property taxes are the main source of funding for public schools, libraries and a litany of other community taxing districts, it’s putting too much pressure on homeowners.
“We do need to eventually solve the problem of higher property taxes,” he said. “We talk about that year after year, but we need to finally do it.”
Koehler talked about the property tax issue after addressing the state’s fiscal year 2027 budget, totaling $55.9 billion. He said this has been the roughest budget to balance in his nearly 20 years serving in the statehouse.
“There’s so many needs and limited amount of money to deal with it,” he said.
This budget is balanced thanks to some new taxes that target social media companies, gambling sites and digital advertising among others. It did not raise the sales or income taxes.
But Koehler said it’s another year where lawmakers searched to find small revenue options to fix budget holes. He said they need to find a long-term solution for keeping Illinois budget balanced.
“We need to have a total rewrite of our tax policy in the state,” he said. “We have a structural deficit every year. We look at what income taxes coming in with sales taxes coming in, and then we say, well, ‘we can’t fund all the things we want to.’ Like education or social services.”
Koehler wants to tackle the tax system in a way that also reduces property taxes. How that might work out, remains undecided. But he said he wants to start discussions with lawmakers on whether they can transition public education funding from property taxes to another area, like the income or sales tax.
Another way to get more dollars into the system is by taxing the richest said Koehler.
“The gap between the wealthy and the poor is getting worse,” he said. “We see all the tech startups and we see the stock market, we’re at war with Iran and yet the stock market keeps going up. Somebody is making a lot of money off of this.”
A proposed constitutional amendment would have added a 3% surcharge on all on personal income above $1 million. It failed to make it out of this year’s legislative session.
However, Koehler supported it.
“Most states and states all around us, Iowa, Indiana, Wisconsin, they all have graduated income tax like the federal government. It makes more sense,” he said.
“I think people want a sense of fairness. You know, what is fair? We all need to pay our share,” he continued.
Illinois fiscal year 2027 budget goes into effect July 1.
WMBD TV first reported this story. You can read more about this story online at CIProud.com.
