CHICAGO - Cook County, Ill. President Toni Preckwinkle said she will fast track her proposal to raise the county sales tax by 1% by calling for a vote this month on the controversial proposal.
Preckwinkle unveiled the tax hike June 30 as a way to address Cook's unfunded pensions. Her plan would raise the county's portion of the sales tax to 1.75% from 0.75%. It would push the overall sales tax rate to 10.25% from 9.25% giving Chicago the highest sales tax rate in the country.
The county board needs to approve the tax by the end of September to start collecting it in January.
The new tax would raise $470 million. Cook faces an estimated $480 million budget gap heading into fiscal 2016, according to the Preckwinkle's office. The county's fiscal year begins in December.
It's unclear whether Preckwinkle has the necessary votes from the 17-member county board.
On Wednesday, 10 board members voted to send the proposal to the finance committee, the first step for consideration.
In defense of the increase, the president said the tax hike is needed because state lawmakers have refused to approve a pension reform plan that would overhaul the county's retirement system. The county has twice tried unsuccessfully to push the reform package through the Legislature.
If lawmakers decide to pass the legislation by the end of the summer, Preckwinkle said she would reconsider the tax.
In a letter to the Chicago Tribune, Commissioner Bridget Gainer, chair of the board's pension committee and a supporter of the county's pension reform package, said she would vote no on the tax increase.
"The sales tax is regressive and a penalty to the poor," Gainer wrote. "It punishes businesses on the edge of Cook County and pushes consumers to buy goods on the Internet."
Preckwinkle said 90% of the new revenue would go to funding the county's retirement systems, which have a $6.5 billion liability and a 54% funded ratio.
The proposal is controversial in part because Preckwinkle won the top county office five years ago campaigning to repeal a 1% sales tax increase imposed in 2008 by then-President Todd Stroger. Once winning office, she repealed the tax over a four-year period. Preckwinkle She says it's vital to ward off more downgrades and an eventual junk-bond rating.