When the state rollback of the locally shared grocery tax first passed, then-Mayor Mboka Mwilambwe didn't think there was an appetite on the Bloomington City Council to impose a local tax. Though the vote was still split, the council passed the tax this week.
City Manager Jeff Jurgens said council sentiment evolved over time. Some of that involved staff conversations about the impact of not continuing the tax.
“Coming with what unfortunately had to be a strong recommendation that the City of Bloomington needed to keep this tax. It was a tax that was already in place," said Jurgens. "Our finance department projected it to be a very substantial number, $3 million to the city. And had we failed to keep it, it really would have put us in a position where we were not able to move forward on a number of projects, and likely would have faced some pretty severe cuts.”
The 1% local tax takes effect at the start of next year when the state tax expires. Hundreds of other Illinois municipalities have approve a local tax, including the Town of Normal.
Since the issue first arose last year, the city has tightened its budget, cut positions, begun a program to reduce staff through attrition, reduced training supply and equipment purchases, and studied other efficiency moves to reduce what was once a more than $5 million structural deficit.
Jurgens said the grocery tax was the last piece needed to address the gap.
“We hope it does. It's not just keeping the grocery tax. It's not just the cuts we've made. There have also been other changes to how internet sales taxes are being divided and attributed, and so we have seen an increase in that as well,” he said, adding the city can now consider moving ahead with some projects that had been deferred or delayed.
“In addition to, obviously, our roads and sidewalks ... we're also still trying to tackle the flooding within the city, and so the East Street Basin is a project that I know has broad support amongst the council,” said Jurgens.
The basin initiative requires relocation of the Public Works Department campus; the city also is seeking grant funding for that.
Video gambling
Also this week, the council approved about 15 more video gambling licenses. The cap went from 60 to 75. Some council members have indicated a desire for more oversight of license holders.
Jurgens said staff is examining whether they can audit performance more than once a year at license renewal time, or whether the city could contract out additional audits. At least half of the total revenue at establishments holding a gaming license must come from food and beverage sales.
“The numbers tell the story ... If we get the reports from the establishment, it's hard for them to lie because we also know the food and beverage tax numbers, and we can make some pretty easy assessments on that. It's pretty black and white,” he said, noting Bloomington does,'t have gaming parlors that specialize solely in gambling.
“And I think that's what helps make gaming not quite so in your face, within the City of Bloomington,” said Jurgens.
Downtown sales tax rebate program
Jurgens said a sales tax rebate program will help downtown businesses disrupted by streetscape construction, pointing out that any business truly impacted will be eligible.
"That's easy to define because for this first phase of the streetscape project, we're going block by block. Whenever construction is ongoing at that block, that's when this program will be in place," said Jurgens.
The financial burden to the city should not be high, less than $30,000 for the first year, he said. This year, construction is only in the 600 block of North Main Street.
