Lake Forest Hikes Sales Tax, Fees To Fund Infrastructure Needs

LAKE FOREST, IL — The City Council increased to taxes and fees to fund capital improvements. Adopting changes expected to bring in an additional nearly $1 million in annual revenue, aldermen unanimously agreed Monday to hike the city's sales tax and raise the cost of water and trash pickup.

City staff have identified $10 million in unfunded capital improvements needed over the next five years. The needs range from stormwater, transportation and safety-related projects not covered by $3.3 million budgeted annually for capital improvements, according to a report from the city manager's office.

To pay for them, aldermen approved an increase of the city's home rule sales tax from 0.5 percent to 1 percent. The change will bring the total sales tax rate on purchases made in Lake Forest to 8 percent.

Of the sales tax revenue collected from those purchases, 62.5 percent goes to the state, 25 percent goes to the city, 9.4 percent goes to the Regional Transit Authority and over 3 percent goes to Lake County.

The change would only affect the sales tax rate on general merchandise, which excludes titled items such as cars and qualifying food and medical expenses. Even with the increase, the report said, Lake Forest would remain on par with nearby Lake County communities.

Combined, hiking the home rule sales tax and boosting the sanitation fee from $96 to $144 a year will generate an additional $900,000 every year to fund capital improvements, according to a memo from staff.

Additionally, the water rate hike was projected to provide an extra $151,396 to the Water Utility Fund by raising the cost by an average of 2.5 percent. The new water and sanitation rates take effect May 1. The sales tax increase will take effect July 1, according to the city.