Tens of thousands of Chicago taxpayers have had significant amounts of money garnished from their state tax refunds in recent years, due to a little-known program that allows the city to collect unpaid debts, such as parking tickets or court fees. Chicago has used this program to collect more than $103 million in delinquent fines and fees between 2013 and 2018, according to an investigation by The Chicago Reporter and Type Investigations, based on data from the Illinois comptroller’s office.
The impact of this program has fallen disproportionately on the city’s poor black and Latino residents, the investigation reveals. In 2018, approximately 80% percent of the tax-refunds intercepted within Chicago were intended for residents in ZIP codes where the median household income falls below the city’s overall median household income of $55,000, according to Census Bureau data. Ninety percent of intercepted refunds were for residents living in predominantly non-white neighborhoods, including areas in and around South Chicago, Midway airport, West Englewood, Roseland, Marquette Park, and North Lawndale, among others. (Chicago contains a total of 58 residential ZIP codes, 57% of which are predominantly non-white.)
Of the $13,471,081 collected by the city of Chicago in 2018, one-third of the money was collected from ten ZIP codes where 92% of residents are black and Latino. These ZIP codes are also seeing some of the highest rates of coronavirus cases in the city.
In Chicago, fines and fees — and how they are collected — have become a key issue of Mayor Lori Lightfoot’s young administration. She has vowed to break the city’s “addiction” to raising revenue “on the backs of low-income people,” and in September, the City Council unanimously approved changes to Chicago’s vehicle ticketing policies, including putting an end to the practice of suspending drivers’ licenses over non-moving violations like parking tickets and expired vehicle registrations.
Thanks to a little-known state program, thousands of Chicago taxpayers have had money garnished from their state tax refunds to pay off debts, such as parking tickets or court fees.