A potential Kane County sales tax referendum hit another roadblock at the Wednesday meeting of the Kane County Finance Committee, where committee members decided not to vote on the issue and instead passed it off to a subcommittee.
The subcommittee, once created, will likely consider both a referendum to impose a new 1% sales tax in Kane County and ways to cut potentially millions of dollars from the county budget, according to discussion between Kane County Board members at the Wednesday meeting.
“Even if the recommendation is to move forward with a sales tax, we have no guarantees that the community and voters are going to support this, but we do have under our control right now being able to take a look at making recommendations — thoughtful, very thoughtful recommendations — on how we could reduce potential expenses going into the future,” said Kane County Board Chair Corinne Pierog, who was attending the meeting but does not sit on the committee.
The sales tax referendum question, if approved by August by the county board, would go before voters in the November general election.
However, the finance committee must now wait another month or call a special meeting before it can create a subcommittee to look into the potential sales tax referendum and budget cuts, since the creation of a subcommittee was not on the agenda for Wednesday’s meeting.
County officials have said the proposed Special County Retailer’s Occupational Tax would help to close the county’s growing budget deficit that could deplete the county’s financial reserves by 2028.
At the previously proposed 1% tax rate, Kane County would have an extra $60 million to spend each year if the sales tax was approved by voters, according to Kane County Finance Director Kathleen Hopkinson.
The county used around $5.6 million from its reserves to balance the 2023 budget and is planning to use around $9.6 million to balance the 2024 budget, she said at previous meetings.
Revenue from the sales tax must go towards public safety, according to state law, but since the county spends the majority of its funds on public safety already, it would free up a part of those funds to go to other departments and offices, Hopkinson has previously said.
According to a presentation by District 22 Kane County Board member Vern Tepe at the March 27 meeting of the Finance and Budget Committee, the county would have to lay off around 15% of its total workforce to fully balance the budget without raising any additional revenue.
While it was discussed informally at a number of previous committee meetings, Pierog officially asked the Kane County Board at its April 9 meeting to consider putting a referendum question about the proposed sales tax before the voters. Instead, board members voted unanimously to send the potential sales tax referendum to the Finance and Budget Committee for review.
A number of different sales tax rates have been discussed, with the highest being 1%. Those paying the tax would see an extra $1 tax on every $100 they spend or an extra penny for every dollar they spend on items covered by the tax in Kane County.
There was some debate at the Finance and Budget Committee meeting Wednesday over whether the committee created to explore the sales tax should be “ad hoc” and made up of any Kane County Board member or a specific subcommittee of the Finance and Budget Committee.
At the end of the discussion, it appeared that most committee members agreed to a subcommittee, though no formal vote was taken.
Pierog recommended that two subcommittees be created – one exploring the sales tax and the other budget cuts. However, District 24 Kane County Board Member Jarett Sanchez proposed that there be just one subcommittee that explored both options.
Members of the public who spoke during designated public comment time at the committee meeting had mixed feelings about the proposed sales tax referendum. One speaker was in favor of the sales tax, but several more were against it, saying that the county needs to make cuts to balance its budget instead of raising taxes.
rsmith@chicagotribune.com
