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Taxing districts: Illinois has more than any other state

by Rachel Wells

By a wide margin, Illinois tops the nation in the number of local governments within its borders. While some elected officials call for consolidation and more efficiency, others insist Illinois’ current system allows for a more democratic and accountable set of governments.

With 6,994 local taxing bodies under its umbrella, Illinois outpaces Pennsylvania, which ranks second among the states for the most local governing entities, by more than 2,100 local governments, according to the U.S. Census Bureau.

Illinois’ large number of taxing districts is a huge problem, proponents of government consolidation say.

“The bottom line is, with America in its deepest economic trouble since the Great Depression and taxpayer anger at an all-time high, we have got to rein in these rogue taxing bodies and pare down the government, not only to save money but to provide more coordinated, or better coordinated, systems of government,” Sen. Kirk Dillard says. During his 2010 run for governor, the Hinsdale Republican proposed establishing a panel to recommend ways to consolidate Illinois’ local government structure.

This spring, Marengo Democrat Jack Franks sponsored a bill, which had not been called for a vote as of press time, that would allow for the study of consolidating Illinois’ layered governments. He says tradition contributes to the difficulties of consolidating local governments.

“Change is hard in any organization. Overcoming inertia oftentimes is the most difficult thing to do,” Franks says.

Indeed, townships, one of the most controversial forms of local government, have existed in the United States since the early days of the pilgrims. However, townships weren’t adopted in Illinois until 1850, more than 30 years after statehood, according to Township Officials of Illinois. Now, 85 of Illinois’ 102 counties contain township governments.

“It is the democracy, the basic democ-racy, that our residents enjoy. Our township [residents] can have a direct say in their local government,” says Bryan Smith, executive director of Township Officials of Illinois. “It’s probably the one form of government that if they have a specific need in a community, the township is the best able and equipped to respond to that need.”

Smith says Illinois’ 1,432 townships often provide services, such as offering emergency food and shelter or hosting job fairs, that other government entities aren’t able or don’t want to provide. “Especially with the downturn in the economy, more and more people are turning to their township governments.”

But the bulk of Illinois’ local governments come in the form of 3,249 special districts, which include library, park, fire protection, sanitary sewer and mosquito abatement.

Many of those single-purpose districts formed because of borrowing limits, says Northwestern University law school professor Dawn Clark Netsch, former comptroller and delegate to the 1970 Constitutional Convention, where Illinois’ numerous local governments were a topic of debate.

The 1870 Constitution limited local governments’ debt capacity, but as society progressed and residents required such services as utilities and water treatment, “those debt limits just didn’t keep up with the changing condition,” Netsch says. Municipalities couldn’t borrow enough to pay for new capital expenses without limiting their borrowing power for other established needs, so they asked the Illinois legislature to create special districts with their own taxing power.

The 1970 Constitution sought to change that and allowed for communities to abolish townships by way of referendum.

Netsch says that some units of local government continue to exist because those outside urban boundaries feel that their taxes would otherwise go to programs they don’t need or use, such as services for the poor.

“Many people prefer to live in unincorporated areas,” says Marion Mayor Robert Butler, a 1970 Constitutional Convention delegate who served on the local government committee. “For whatever reason, they like to be more in a rural setting than an urban-type setting. ... You don’t pay city taxes when you’re in an unincorporated area. Sometimes the city tax might be considered onerous to them.”

Boundary issues have also contributed to Illinois’ high number of special districts, Netsch says. A water district or transportation service, for instance, might serve more than just those inside city borders.

Or, a smaller community might be forced to create a new district if it’s too far away from an existing district. “People will set up a sewer district because they are not a part of a city or a village government where city sewer facilities are available,” Butler says.

“[Special districts] do serve a purpose, and there’s no question people would not have these various services if they did not have a district set up,” Butler says, adding that inefficiencies do exist. “When you have layer upon layer of units of government, you’re probably duplicating in some fashion, [and] your costs are going to be higher,” he says.

The Illinois Municipal League remains neutral on the subject of consolidation or elimination of townships and special districts, but says municipalities are sometimes open to the idea. “Cities and counties have both expressed willingness to take on additional functions, but generally speaking [those officials] haven’t wanted to force other units of government to give up their powers,” Larry Frang, league executive director, says. He adds that the local governments he represents already have tight budgets and plenty of responsibilities, which keep them from actively pursuing or encouraging consolidation.

Nancy Krumwiede, president of the Illinois Association of County Officials, says multiple layers of government can cause some residents confusion, but they also allow more people to have a direct say in government.

“There are so many different voices in government that can be heard,” she says. “It’s not just a core group making the decisions.” Krumwiede adds that consolidation in some instances would pose challenges to the people those governments serve if they are forced to travel long distances to meet with officials or acquire services.

While advocates for maintaining particular taxing bodies say they are more democratic, Dillard says they can harbor “dynasties” and “nepotism.”

“The closures haven’t happened, sadly, because of politics,” Dillard says. “The minute we try to consolidate school districts, or even harder yet, get rid of units of local government, people who are generally politically connected are going to come flooding legislators’ offices saying, ‘You can’t do that.’’’

Franks calls many of Illinois’ districts a form of “fiefdom,” while Illinois Policy Institute CEO John Tillman says Illinois’ numerous governments are an avenue ideal for “special insiders,” “deal making” and “favors.” The thousands of governmental units in Illinois create thousands more taxpayer-funded jobs held by people who become advocates “to maintain the status quo.”

Some areas may need townships and special districts, Franks says, but more populous areas sometimes double their efforts when one governmental entity has grown to fully encompass another.

Franks says: “One size does not fit all. But I also know that we need to have this discussion.”

Illinois Issues, May 2010


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