SMALL TOWN LEADERS BLAST PLAN BY ILLINOIS GOVERNOR

CAIRO, Ill. -- Gov. Jim Edgar and Illinois state legislators may be receiving special gifts from some Southern Illinois municipal officials in the near future.

"They are going to receive `keys to the city' from Cairo," said Mayor James Wilson. "And, I'm going to start a campaign next week to promote this campaign in other communities."

The message to be conveyed with the keys will be simple.

"This is the key to our city," said Wilson. "If the governor's plan to cut municipal funds goes through, he can run our city. We won't have the money to do it."

Wilson's campaign is in response to Edgar's budget proposal unveiled Wednesday.

Edgar has proposed a $29.2 billion budget that would make permanent an income tax surcharge, which was assessed in 1989. The surcharge was scheduled to be discontinued July 1.

Moreover, he proposes spending the surcharge money on mental health, education, and other state programs instead of sharing the special fund with local governments as the tax initially was designed to do.

"When the surcharge was first put into effect, half went to education and half to local government," said Wilson. "Last year, the governor took away half of the share to municipalities. Now, he wants to take the rest of it.

"This the most insane thing I've every seen a governor propose," said Wilson, who is very vocal with his discontent. "The impact on poor communities will be devastating."

Wilson said the proposal would result in the loss of more than $125,000 for the city of Cairo.

"Layoffs will occur, local taxes will go up, and services will be cut," he said.

Ken Kohler, mayor of Anna, Ill., agrees.

"We're making a lot of contacts with legislators these days," Kohler said Friday. "We've talked with our local legislators, and they support our concern."

Kohler said that Anna's share of the surcharge was about $100,000.

"That's a sizable chunk for a small city," he said. "We used those funds in our city budget for police cars, salaries and other services."

Kohler added that the city's taxation base had just about reached its limit. "We need these funds," he said.

"The governor talks about `kids, not concrete,'" said Kohler. "But, kids have to have good roads to get to school, good sewer systems and drinking water, and other city services. We all care about kids and concrete, but Gov. Edgar needs to deal with both issues."

Kohler, Wilson, and a number of other city and county officials say they will work together to fight the surcharge issue.

The mayors said they hope the legislators will fight the governor on this issue. They said many cities use the funds to cover operating expenses.

Sen. Ralph Dunn (R-DuQuoin) supports another means of acquiring funds for the state's general budget.

"I support Gov. Edgar's budget, but I think we should find another way of obtaining tax money for the budget," said Dunn, who added he would favor adding an additional 1-cent sales tax.

"The governor wants to end the temporary surcharge and make it permanent," said Rep. David Phelps (D-Eldorado). "He would give the money to various state agencies and create new programs.

"What the governor is really doing is looking to fund projects around the state to pave the way for his re-election," added Phelps, who believes the governor's budget does not address the many problems affecting Southern Illinois.

"Our state is $897 million in debt, 21 percent worse than last year," said Phelps. "The governor is continuing the credit card game of spending now and paying later. He has evidently given up on the idea that the budget can be balanced."

Some legislators called Edgar's surcharge shift "a back-door tax increase," because it would make higher tax rates permanent, and local governments might raise taxes to offset their revenue loss.

House Speaker Michael Madigan, D-Chicago, wrapped both of these themes into his first sentence of commentary after Edgar's speech.

"Mr. Edgar has been the governor of Illinois for three years, and for the third year in a row he has proposed increases in taxes to provide for increases in state bureaucracy," Madigan told The Associated Press.