As communities around the state debate whether to replace the state’s soon-to-end grocery tax with one of their own, Elgin Mayor Dave Kaptain said he’s not in favor of the swap to fill the $1.2 million budget gap the tax loss will create.
“My personal opinion is I’m not in favor of putting the tax back on,” Kaptain said.
Elgin increased its water rates by 9.4% and sewer rates by 4% this year, and the Elgin City Council is discussing whether to ban single-use plastic bags in stores, charging consumers a 10-cent fee for paper bags if they don’t bring their own reusable bags.
The utility hikes were done to generate income for ongoing state- and federally-mandated infrastructure improvements, including the replacement of lead service lines bringing water into older homes. The latter proposal is driven by concern for the environment; plastic bags take thousands of years to decay and produce toxins that can go into the ground and seep into the water system.
Hitting grocery stores and residents with both a grocery tax and a paper bag fee would put a lot of stress on grocers and customers, Kaptain said.
“It’s really something that hits close to home for people who are struggling,” he said. “We have a number of taxes. If we need more money, we have other places to do a tax increase.”
It’s his belief the city can fill the budget gap with other revenues, the mayor said. Elgin has more flexibility than other communities. Smaller towns with populations of less than 25,000 may not be able to make up the revenue loss, he said.
“Some communities depend on (the tax) more than others,” he said.
Ultimately the decision is up to the council, which must make a decision on implementing the tax by October before the state grocery tax falls off on Jan. 1. A discussion on the topic has not yet been scheduled.
“I’m still waiting to listen to the council and hear what other people have to say,” Kaptain said.
As part of the Metropolitan Mayors Caucus, he said he’s listened to opinions on both sides of the issue. Many community officials say they believe adding a local grocery tax to replace the state one won’t hurt people because it’s something they’re already paying, he said. There also is some resentment that the state “abdicated” on collecting the tax, he said.
While the state has been collecting the tax, it doesn’t keep any of the money. It’s all passed on to the towns in which the stores are located.
So far, more than 100 municipalities in Illinois — including Huntley and East Dundee — have decided to instate their own grocery tax, said Dylan Sharkey, editor of the Illinois Policy Institute News, a nonpartisan research that advocates for lower taxes, especially those assessed on property.
But keeping the tax in place is not popular with residents, he said. A poll done by Illinois Policy found that 70% of residents who responded opposed the grocery tax. When the village of Bensenville put the issue to a vote in an April referendum, it failed by 90%.
Sharkey said he wasn’t surprised by either action. “People are fed up with taxes,” he said.
Gloria Casas is a freelance reporter for The Courier-News.
