Cook County board approves tax hike sought by board president
Attention Cook County shoppers: Those items in your shopping cart are going to cost a bit more next year.
The Cook County board narrowly approved a one-percentage-point tax hike Wednesday, after hours of public testimony and debate. Board President Toni Preckwinkle proposed the plan, which she says could bring in more than $300 million annually.
Preckwinkle has pledged that most of the additional revenue will go toward the county’s underfunded pensions. Nine board members supported the plan, the minimum number needed to pass the measure. One commissioner, Liz Gorman, who is leaving the board, voted present, while seven voted against the plan.
The county sales tax is currently .75 percent and will rise to 1.75 percent on Jan. 1, 2016. That will boost the sales tax in Chicago to 10.25 percent, which is among the nation’s highest.
“I understand this was not an easy vote,” Preckwinkle said after the special board meeting. “It was not, frankly, an easy proposal for me to put forward. But I feel strongly that leaders are elected to lead, and that in this case we had to step in and make the tough decisions for the future of cook county.”
This isn’t the first time Chicago’s sales taxes have been in the upper echelon; Preckwinkle campaigned in 2010 to repeal the 1 percent sales tax hike implemented by her predecessor, Todd Stroger. But this time around, she said since Springfield hadn’t come through on pension reform, and since she knew commissioners wouldn’t vote for raising property taxes, increasing the sales tax was the best option.
Many commissioners strongly disagreed. Commissioner Richard Boykin likely spoke out the most in both the finance committee meeting and special board meeting that were held back to back on Wednesday. He said the tax would affect those who could afford it the least.
“Every commissioner on this board should think about what it means for a person on a fixed income, or a person with a low income or even a moderate income, to go to the store, purchase a gallon of milk, a dozen of eggs, a pair of socks, a tube of tooth paste, and what kind of additional expense this tax increase will add to that person’s shopping bill,” Boykin said.
A few commissioners, and Civic Federation President Laurence Msall, said they were concerned about voting on revenue ideas separately from the county’s regular budget discussion. Msall praised Preckwinkle and the board for making county government more efficient, but said he couldn’t support the sales tax proposal on its own.
“All of us are frustrated by what’s going on in Springfield, all of us are impacted by the state’s inability to balance its budget,” he said. “But that does not justify and does not mandate that you move forward on a sales tax increase.”
Meanwhile, many small business owners took the podium to share their concerns about how the additional tax would hurt them and their customer base.
Scott Price, President of Tom’s Price Furniture, said he remembers how business was affected the last time the Cook County tax was increased. Price said his family owns five locations, two in Cook County, two in DuPage County, and one in Lake County. Price remembers seeing a difference in his sales, depending on where in Illinois the store was located.
“I had to lay off staff at my Skokie store, and I actually had to hire people in Lake County and in the collar counties,” he said. “We’re a family business, these are like members of our family, that was a horrible thing for me to do.”
But many retirees, like Valorie Dean-Emanuel who said she worked for years in the Cook County Hospital system, said they supported the tax increase, as it’s their pension payments that are up in the air. County officials say the pension fund is currently only around 57 percent funded.
“Somebody needs to do something to fix this problem. Because you have people coming behind me. I’m gonna make 80, 90 years old. County promised me a check the rest of my life. I’m gonna get it,” Dean-Emanuel said.
The next step for the county will be to alert the state by the October 1 deadline of their latest sales tax rate. But before that happens, some commissioners are already planning on amending the sales tax. Commissioner John Fritchey is planning to file an amendment that would phase out the penny on the dollar tax in two years.
Preckwinkle has also said that if the state legislature passes her county pension reform plan, then she would reconsider the sales tax hike. But if or when that will happen, remains to be seen.
County officials say they expect the new sales tax to bring in $308 million in the first year, and $474 million in the second year.
Lauren Chooljian is WBEZ’s City Hall reporter. Follow her @laurenchooljian