Kankakee mayor wants Chicago, RTA to drop sales-tax suits - Chicago Tribune

Kankakee Mayor Nina Epstein said Wednesday morning that she hopes the Regional Transportation Authority and the city of Chicago will drop their legal challenges to her city's sales-tax incentive program, saying the public acrimony could kill what has been a golden goose for her city and for the state.

"I would certainly hope that cooler heads will prevail and that we can handle any issues they may have with the program in the legislative process," Epstein said at a press conference. "My fear is, as these drag on, regardless of the result, this program will go away because companies do not want to have their names dragged through the front pages of any newspaper."

The program generates more than $50 million annually for the state, she said. It also provides up to $4 million annually forKankakee, a significant sum for a city with a general fund budget of $23 million, she said.

The increased public scrutiny over the past year has led several companies to pull out of the program, and in some cases leave Illinois, attorney Stan Kaminski, who represents a coalition of businesses favoring such programs.

The press conference Wednesday comes a little more than a week after the RTA and Chicago filed lawsuits in Cook County Circuit Court alleging thatChannahon and Kankakee, with help from several consulting firms, are improperly diverting sales tax revenue to their communities.

In Illinois, sales taxes are calculated where an offer is said to have been accepted, not where customers receive a product. So some firms have set up satellite offices in communities with lower tax rates.

These alleged distortions in sales tax collections mean that Kankakee and Channahon� lead the state in annual retail sales per capita with a rate 10 times that of Chicago, attorneys for Chicago told the Tribune last week.

Officials in the towns said everything they are doing is above-board and legal.

Representatives of Channahon were not at the press conference.

Federal authorities on Tuesday charged the recently re-elected mayor of the far southwest suburban with failing to file four years of federal tax returns.

Joseph Cook, 45, allegedly failed to report more than $250,000 of income from 2005 to 2008, including earnings as mayor and liquor commissioner of about $16,000 a year, according to charges filed late Monday.

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