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March 18, 2011

Illinois Senate Leader Proposes Raising Cigarette Tax to Fund Road Projects 

With the state's $31 billion capital plan being challenged in court, Illinois Senate President John Cullerton, D-Chicago, is pushing a $1-a-pack cigarette-tax increase to provide money for transportation and other infrastructure construction projects.

Under Cullerton's plan, cigarette taxes would increase 50 cents a pack this year and another 50 cents next year, GateHouse News Service reported. He would tie that to a reduction in taxes on wine and liquor. Alcohol taxes were increased to pay for a state capital funding bill passed in 2009.

Cullerton's plan does not call for the state to reauthorize legalization of video poker, another component of the original funding plan for public-works construction projects. The state has yet to get video poker operational, and many communities have opted to keep it out of their jurisdictions.

"There's a challenge to the capital bill in the Supreme Court," he said Tuesday. "If they overturn it, we won't have any funding for the bonds we have sold or the bonds we want to sell."

Cullerton said he is convinced the Illinois Supreme Court will side with the state in the lawsuit, and the capital program will be allowed to continue.

"The problem is it could be late summer or fall," he said. "In the meantime, we lose a whole construction season here in Illinois."

Chicago Blackhawks owner Rocky Wirtz, who also owns a large liquor distributorship, sued the state over the higher liquor taxes passed in 2009 to fund road repair and other construction. An appeals court ruled that the state, in enacting the capital program, put too many disparate pieces together in one bill, making it unconstitutional. It's that ruling that's on appeal before the Supreme Court.

The state's cigarette tax now stands at 98 cents per pack. It was last increased in 2002.

The Illinois Department of Transportation is continuing its work on the capital program while the courts settle its constitutionality.

"IDOT is continuing to move forward with its capital program and projects as planned," said spokesman Josh Kauffman.


Questions regarding this article may be directed to editor@aashtojournal.org.

 
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