Richard Ogilvie instituted the Illinois State Income Tax during his term 1969-1973. Aside from the fact that he had a Republican legislature, how did he accomplish this? What was his campaign like? How did he approach this matter and convince the public that it was necessary? Yes, I know the public voted him out of office, but first he did something unthinkable in today’s political climate - a Republican raising taxes. How did this happen?
It was a different time and Illinois Republicans who win statewide offices tend to not be insane.
When Ogilvie got into office, the state faced a billion dollar budget deficit. Ogilive had come out publicly against a state income tax while running, but privately acknowledged to his staff that he would have to push for one. After he got elected, he had a bunch of secret nighttime meetings with senior staff to work on a budget that included an income tax, while publicly focusing attention on issues like prison reform.
On February 5, he called a special meeting of the legislature, where he laid out the state’s finances. He told them that the state was “tottering on the brink of bankruptcy”, that he was mandating an austerity program laying off state workers, freezing capital improvement projects, and requiring a 10% savings plan from every state department. He also announced he would seek legislation to bring in additional revenues, and ended the speech with the ominous “I plan to manage this state government as it has never been managed before.”
Meanwhile, there had been some support for the introduction of a state income tax. Clyde Choate, the House Assistant Minority Leader, had proposed a bill introducing a 2% income tax on individuals and 5% on corporations. Meanwhile, a panel set up by the last governor had recommended the adoption of an income tax.
But still, there was wide political opposition to an income tax. Democrats in the legislature announced they wouldn’t support any income tax where the rates for individuals and corporations were the same, and a lot of Republicans announced they wouldn’t support any at all, preferring instead, to raise the sales tax. Meanwhile, the Lieutenant Governor, Paul Simon, made his own proposal to adopt Choate’s bill and get rid of the sales tax on food and cutting property taxes in half.
So, on April 1, Ogilve went to the General Assembly and proposed his tax plan…a 4 percent income tax on individuals and corporations, and raising taxes on alcohol, tobacco, and rented equipment. It didn’t go over well. There was some applause, but not much, and some of the Democratic legislators didn’t even get out of their seats when he left. Then, after he left the chamber, he had to walk through a gauntlet of protesting state workers. One Republican legislator warned “Too many of us got elected campaigning against the type of proposal the governor presented. If no compromise is found, his tax plan will go down.”
Not long after, Ogilive met with Republican legislative leaders to confirm his desire for a state income tax. W. Russell Arrington, the Senate Republican leader, lost his temper during the meeting and asked “What fool in the Legislature do you think you’re going to get to sponsor the bill?” Ogilive just looked at him and said, “Why, you, Russ.”
Arrington reminded the meeting that he had campaigned strenuously against the income tax, but ultimately, party loyalty and loyalty to the Governor made him agree, saying “If, in your opinion, it’s time, I’ll do it.”
So, ultimately, it was up to Arrington to get his party to go along. On the Democratic side, Mayor Daley, the mayor of Chicago, had a lot of influence over the legislative Democrats (many of whom were from the Chicago area), and he had been a strong supporter of the income tax, and was able to get the Democrats in the legislature to go along, in exchange for political concessions to Daley. The Republicans, though, were harder, but Arrington was able to use his power over them to get enough votes so that, combined with the Democratic votes, the bill passed.