Hinsdale Caught Off Guard By Local Gas Tax's Impact

HINSDALE, IL — Last year, Hinsdale imposed a gas tax hike on the Cook County side of the village. But the tax ended up affecting gas stations on the DuPage County side. The stations were apparently taken by the surprise. So was the Village Board.

In 2019, the state allowed Cook County towns to charge an additional 3 cents a gallon to the gas tax, known as the motor fuel tax in government jargon.

As a result, the village passed an ordinance for the Cook County side of the village. That tax would apply to the Hinsdale Oasis gas station, primarily used by non-Hinsdale residents driving by on Interstate 294.

But village officials said at this week's board meeting that they learned recently that the state required Cook County towns to apply the gas tax to all stations within their boundaries, even those outside Cook. The other stations are used more by Hinsdale residents, so the tax would have a greater local impact.

The tax had been imposed on local gas stations July 1. Village officials said they did not get notice that all stations would be affected.

Village-wide, the tax is estimated to generate $325,000 to $350,000 a year, more than twice the amount if only the Oasis were affected.

Trustee Gerald Hughes said that at some point, the village may need the tax money from all the gas stations, given the pandemic-caused drop in tax collections.

"We can't continue to defer essential maintenance of our roads. We saw 10 or 15 years ago what a mistake that was, and I don't think we want to repeat that," Hughes said. "But I know that once taxes are in place, they rarely roll back."

He suggested repealing the tax across the board for now.

Village President Tom Cauley said the local government was in a "tenuous" financial situation, but it did not require immediate action.

"We have some problems. I'm not so sure that we won't be in a good position next year. We just don't know at this point," Cauley said.

The board voted to repeal the tax, effective Jan. 1. Village officials said they would lobby local state lawmakers to change the law to allow the village to assess the tax on the Cook County side.