Glencoe Village Board Approves 2 New Sales Taxes

GLENCOE, IL — Two new taxes are set to take effect in Glencoe starting in July. Trustees Thursday approved ordinances creating local food and beverage and gas taxes, village staff announced.

A 1 percent "Places for Eating Tax" and a 3 cent-per-gallon local fuel tax could generate as much as $126,000 per year combined in additional revenue, according to estimates from village staff.

Both measures are aimed at diversifying the village's revenue sources and reducing its dependence on property taxes and other traditional sources.

About 19 percent of village revenues flow through state government. But cuts in revenue shared by the state, increases in mandated pension funding and anticipated investments in village infrastructure led village staff to suggest alternative ways to supplement revenue, according to a statement.

"Whenever possible, the Village Board remains committed to limiting the impact of revenues such as these on Glencoe residents," it said.

Various alternatives were presented to the village board for consideration before the two new taxes were approved at the board's Jan. 16 meeting.

Places for Eating Tax

The 1 percent tax would apply to restaurants, caterers, grocery stores, convenience stores, theaters, bowling alleys, golf courses, country clubs and anywhere else where food and beverages are offered for immediate consumption, according to a memo from Finance Director Nikki Larson.

According to initial estimates, the new tax would apply to about 20 businesses in the village and would generate as much as $90,000 in annual revenue. It will be collected on a monthly basis.

Much of the tax would be paid by people who live outside the village who work in Glencoe, patronize local restaurants or attend a performance at the Writers Theatre, according to the memo.

More than a dozen north and northwest suburban municipalities have adopted local food and beverage taxes, with Skokie's 2 percent rate the highest on the North Shore.

Local Motor Fuel Tax

The new gas tax will apply to all gasoline sold within village limits. The tax was authorized by recent changes to state allow that allow Cook County municipalities without home rule authority to add an additional tax of 3 cents per gallons of fuel.

Under the state law, revenue generated by the tax must be used for street maintenance. Village staff estimated the new tax could generate as much as $36,000 a year.

Unlike the home rule fuel tax, the fuel tax will be administered by the Illinois Department of Revenue, which will deduct a 1.5 percent administrative fees before remitting it back to the village on a monthly basis, according to village staff.

Both new taxes were included as components in the village's Stub Year 2020 budget, which runs from March 1 to Dec. 31 as the village adjusts the schedule of its fiscal year. They will go into effect on July 1.

"The Village is developing a web page and comprehensive communication plan to provide tax remittance instructions for business owners, including a 'frequently asked questions' document that will address the applications of these taxes," Larson said. "We also plan to hold meetings to assist with any questions from the business community."