Owe City Hall? Chicago may take it out of state tax refund

A car is ticketed in Chicago's Loop. (Phil Velasquez/Chicago Tribune)

Illinois residents who owe money to Chicago City Hall could find a hold placed on their state income tax refunds under a measure endorsed today by the City Council Budget Committee.

The city hopes to collect between $8 million and $20 million in unpaid debt from parking tickets, red-light citations and city administrative hearing judgments if the full council approves the measure Wednesday.

That money would be something of a bonus for the city this year because it was not expected when the city passed its budget last year, said Tina Consola, managing deputy director of the city Finance Department.

Under the program, the state comptroller withholds money owed to cities and villages. It was made possible by a state law approved in recent months, Consola said.

“I think it’s great,” said Ald. James Balcer, 11th, before voting in favor of the debt-collection measure. “If you owe money, you should pay it back, no matter who you are.”

More than 100,000 of the state’s residents who get state refunds owe an estimated $80 million to the city, Consola said. But their refunds would not cover that full amount, she added.

The debt owed on parking and red-light tickets would only be deducted from income tax refunds if the debtors have been repeatedly notified and failed to pay the fines. Administrative hearing fines come from violations of building, fire and sanitary codes, as well as city tickets for such infractions as false burglar alarms.

“The city and state really wanted to limit it to debt that has been adjudicated and the debtor has had a chance to protest,” Consola said. The debt can go back as far as 2005 under the new state law, she added.