Early voting begins today in Illinois, and with it, the opportunity to increase our state's revenue and set the stage for increased funding for higher education. The proposed Fair Tax amendment aims to change the income tax rate from a flat rate (taxing everyone at the same rate) to a graduated rate. Ninety-seven percent of Illinoisans will see either no tax increase at all or a tax cut; this change will increase taxes only on Illinois' wealthiest residents. By passing the fair tax referendum this fall, state leaders will not only raise more than $3B a year, but more importantly, create a pathway to adequately fund colleges and universities, invest in college students, and build a strong future for our state.
Support for a fair tax system could not come at a more pivotal time. The state is reeling from the fallout of an unprecedented public health crisis that has had deep economic implications for colleges, students, families, and Illinois communities. For students, higher education remains the surest way to the middle class and will be more important than ever to help students and their families recover from the pandemic. According to the Pew Research Center, the unemployment rate in May was lowest among workers with a bachelor's degree or higher (7.2%), the only group not to experience an unemployment rate in the double digits. Similarly, those with a postsecondary degree or credential will likely fare better in the recovery, as over 95 percent of jobs created after the Great Recession went to workers with at least some college education.
Amidst the fallout, Illinois colleges and universities have persisted in carrying on their missions. Despite significant strains on existing resources, they continue to deploy critical resources to students and community members who have been most impacted by the virus, demonstrating their unique value to the future vitality of our state. As the state faces the ongoing impact of COVID-19, investment in higher education will be critical to supporting institutions and equipping students with the resources they need to enroll and persist in college and achieve their career aspirations.
However, as the proverbial budget-balancing wheel, without additional funding from the federal government or new state revenue, colleges and universities are preparing for the worst. Just this month, the Governor asked state agencies to plan for 5% cuts in the current year and 10% cuts next year. This is troubling news for all institutions but could be devastating for Illinois' most financially vulnerable colleges and universities, often the same institutions that serve higher percentages of Black and Latinx students. This is particularly concerning now, as COVID-19 is disproportionately impacting Black and Latinx communities and exacerbating inequities experienced by students of color. Cuts to the Monetary Award Program (MAP) or to institutions serving marginalized students will undoubtedly result in more pronounced equity gaps in access and completion for Illinois' Black and Latinx students and students from low-income communities. For many, it could close the door to higher education altogether.
On its own, a fair tax system will not fill our projected state budget shortfall or close existing equity gaps, but it is a necessary first step. In the immediate term, it could lead to level funding for FY2022, which can provide stability for students who rely on state-based financial aid to access college, and to institutions that depend on state funding for critical programs and services. In the long-term, it could position Illinois to implement a more adequate and equitable higher education funding model that prioritizes funding to institutions serving marginalized communities.
When filling out your ballot this fall, vote yes on a tax system that will work towards economic equality and provide Illinois the revenue boost it needs to fund critical services, like higher education.
*Public higher education institutions and employees are limited in their ability to take action on behalf of Fair Tax. If you're interested in supporting a fair tax system in Illinois as an individual, sign on to endorse Fair Tax here.
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