Enabling Progressive Revenue for Aurora
Getting the state to uncuff municipalities — so cities can raise real revenue, cut property taxes, and invest again.
Institute for the Public Good — Ishan Daya, Julie Dworkin
Structural deficits, not one-off gaps
The City of Aurora, similar to municipalities across the state, is facing mounting fiscal pressures — structural deficits that require challenging tradeoffs, and pull us back from making the investments that we know make our cities safer and more thriving for our residents.
Both of these gaps are occurring while funding at the state and federal levels is declining — and while the state holds the keys to allowing our municipalities to raise real revenue at the municipal level.
Aurora's budget, in brief
The scale of the problem, and the scale of the tools. All figures from the FY2026 adopted budget.
Where the revenue comes from
Two numbers to hold onto. $103.7M of property taxes — the base residents feel most, and the one progressive revenue could relieve. And $32.2M of LGDF — the annual point of leverage Springfield holds over Aurora, roughly the size of last cycle's deficit.
The state holds the keys
While the state uses the LGDF as an annual point of leverage, and the federal government continues to roll back tax measures for corporations and the wealthiest, we see a pathway to raising real revenue to close the gap, decrease property taxes, and allow us to invest in real programs — by going to the state, and getting permission to raise real revenue at the municipal level.
Enabling authority. The state grants municipalities permission to levy the tax.
Local vote. Once permission is granted, the city votes on it at the city level.
Local rate. The rate is set at the city level — Aurora decides how far to go.
What this is not: a mandate, or a rate set in Springfield. Enabling authority hands the decision — and the dial — to the city.
What could that look like?
Five measures. Four need enabling authority from the state; one Aurora can do today under home rule. Solid bar is the low estimate — the floor. The lighter extension is the upside.
City-level Corporate Income Tax
What is it?
A tax on corporate income, apportioned to the City of Aurora based on receipts in Aurora. The apportionment is what allows us to side-step the “worry” about corporations leaving the city. This touches anyone that spends or does any business in Aurora — where the transaction takes place.
Why apportionment matters: the base follows the sale, not the headquarters. Leaving the city doesn't leave the tax behind.
Up and down based on the rate. This range is modeled at a 2% rate.
The state needs to allow the city to do this. Once permission is granted, we vote on it at the city level and the rate is set at the city level.
City-level High Earners Tax
What is it?
A tax on high earners — those making more than $500K — that touches both residents and commuters (apportionment again). It holds the first $500K exempt for anyone in the city, and taxes everything above $500K at 3.5%.
If the state won't do a millionaire's tax, the city can do its own — at $500K.
First $500K: exempt, for everyone.
Above $500K: taxed at 3.5%.
Who's covered: residents and commuters both.
Modeled at the 3.5% rate on income above the $500K exemption.
The state needs to allow the city to do this. Once permission is granted, we vote on it at the city level and the rate is set at the city level.
Electricity Use Tax Reset
What is it?
Our current electricity use tax is inverted — the more you use, the less you pay per incremental kWh. With industrial electricity users, and mega electricity users (data centers / quantum centers) growing in power, we want to ensure the incentives are aligned so that those who use the most, pay the most.
We are proposing to make our electricity use tax progressive — small users like homes and small businesses pay slightly less, while industrial users pay more.
Illustrative — direction of the current rate structure, not Aurora-specific rates.
The state needs to allow the city to do this. Once permission is granted, the city votes and sets the rate.
Payroll Expense Tax
What is it?
A tax on companies with greater than $8M in global payroll, applied to their Aurora employees earning more than $200K in annualized payroll (including stock). Modeled off Seattle's JumpStart tax.
Two thresholds do the work: the $8M global payroll floor exempts local and small employers entirely; the $200K salary floor means it only reaches the top of the pay scale.
Employer: more than $8M in global payroll.
Employee: more than $200K annualized, including stock.
Precedent: Seattle's JumpStart tax.
The state needs to allow the city to do this. Once permission is granted, the city votes and sets the rate.
Social Media Tax
The one Aurora can do without asking Springfield.
A per-person, per-month tax on social media companies — not users — on every user they have who resides in Aurora.
Municipalities with home rule authority. No enabling legislation required — Aurora already has the power.
Chicago has already moved a version of this. It's the shortest path from conversation to revenue — and a proof point for everything else on the list.
Build the package
Toggle measures on and off, and slide each between its low and high estimate, to see what closes Aurora's $30M gap.
5 of 5 measures selected
Discussion
How has your administration thought about progressive revenue to date — to fund your ideas, like public broadband?
Are these of interest as of now? What open questions come up?
Issues, challenges, concerns — where does this get hard?
If it is of interest, how would you want to engage? And which other municipalities or leaders do you think would want to engage?
Have you spoken with others about progressive revenue potential already?
The ask is permission, not money.
Springfield doesn't have to fund Aurora. It has to stop standing between Aurora and its own tax base. Every measure here is decided, rated, and voted on in Aurora — the state's only job is to get out of the way.
Institute for the Public Good
Ishan Daya · Julie Dworkin
publicgoodpolicy.org · comms@i4pg.org