By Peter Ricci

A new bill approved by the Illinois House would prohibit cities, counties and other local government bodies from raising property taxes on homeowners for years when the assessed value of their home declines.

Passing by a 74-39 margin, the bill would only allow such property tax increases if voters approved the measure in a special referendum.

The bill, which legislators say is supposed to protect the finances of middle-class taxpayers, was backed by Jack Franks, a Democratic state representative from Marengo who originally presented the bill in November, when it was swiftly defeated in a 34-73 vote.

“This wouldn’t take any money away from local governments and schools,” Franks said about the bill. “They would get the same amount of money they got last year. If they need more money, they can ask the voters.”

The bill, however, it still not law – it must now make its way through the Illinois Senate, where it could face strong opposition from school districts, firefighters, police officers and teachers, all segments of the local public sector that count on property taxes for their funding and salaries.

Also worth considering is if a property tax reduction would have short-term benefits but long-term costs for Illinois, especially in the wake of the budgetary issues that California governments have faced in the wake of Proposition 13.

Originally passed in 1978, Prop 13 was inspired by the anti-tax fervor that would sweep Ronald Reagan into office in 1980. Slashing property taxes by considerable sums statewide, the legislation also required a two-thirds vote from California’s electorate to approve any new taxes, a difficult obstacle that weakened the state’s revenue streams while its costs continued to mount – a tricky situation that often leads to budget problems down the road.

Illinois’ budget has been a focal point the last couple years. The state currently faces an $11 billion shortfall, and Governor Pat Quinn’s budget – which, coincidentally, was announced via the governor’s budget address a day after the House’s vote – has called for a 9 percent reduction in agency budgets, a $2.7 billion lowering in Medicaid funds and a complete restructuring of the state’s pension fund, which is under-funded by $83 billion.

“Today I am proposing a budget that includes serious spending reductions and major reforms in order to restore fiscal stability to our state and build and grow our economy,” Quinn said in his address.

Such budgetary hysterics regarding the House bill may be overblown, though, considering the aforementioned uphill battle it faces in the Senate. In fact, Terry Link, a Democratic Illinois State Senator from Waukegan, said to the Illinois Municipal League last week that “the measure is dead on arrival” in the Senate.

Also, as the Daily Chronicle pointed out in a story on the bill, Martin Sandoval, a Democratic Senator from Cicero, introduced similar legislation in his chamber of Congress, but it’s been stuck in committee since January, and may not even come to a vote.