LGDF Restoration

Last update: 5/31/2023
The State Fiscal Year (SFY) 2024 budget includes an increase to the Local Government Distributive Fund’s (LGDF) share of the income tax. The Budget Implementation (BIMP) bill (House Bill 3817) includes a reported $112 million increase to the LGDF. While there has been some reported uncertainty about that $112 million figure, the critical upshot for local governments is that the LGDF’s share of the state’s Personal Income Tax will increase from 6.16 to 6.47 percent. This is a significant increase compared to last year’s increase from 6.06 to 6.16 percent. In addition to the reallocation of the Personal Property Replacement Tax (PPRT) and natural growth in revenues, the NWMC estimates that this LGDF increase will restore approximately $85 million over the next decade.

Throughout the session, the NWMC and its local government partners in the Invest in Communities Coalition urged lawmakers to include an increase to the LGDF in the budget. The Coalition issued a statement this week that said, in part, “This work paid dividends for our communities as legislators heard our collective voices. We look forward to continuing this work to further increase the investment in Illinois communities.”