Chamber wants in on Naperville food, beverage tax talks

Naperville City Council members are preparing — in less than a month — to introduce drastic changes in the way they spend revenues collected from a 1 percent food and beverage tax charged to patrons at bars and restaurants.

Officials from the Naperville Area Chamber of Commerce, however, are urging the council to slow down and “take a break” from the conversation.

Naperville's food and beverage tax revenue long has been earmarked for the city's Special Events and Cultural Amenities Fund, or SECA.

But the city's take from the tax has been steadily growing to the point where it generated $3.3 million this fiscal year, exactly $2 million more than was projected when the tax was introduced in 2004.

As a result, council members recently agreed to cap annual donations to the SECA fund at $2 million and to designate part of the remaining revenue to help pay down the city's $97 million pension liability in 14 years and to earmark the rest for social service organizations that have seen their funding dwindle in recent years.

In the past, almost all the SECA money has been used to support cultural experiences in the city, from assistance to the DuPage Children's Museum to funding for the Century Walk public art project to helping pay for community festivals.

Beginning in 2011, the city began diverting about a quarter of the tax revenue to the general fund. But City Manager Doug Krieger said the economy has improved to the point where that roughly $825,000 is no longer necessary to balance the budget.

Council members have praised the new plan, saying they are doing taxpayers a favor by paying off the pension debt six years early and saving $65 million in the process.

But Mike Evans, chamber president and CEO, said he intends to ask the council to slow things down.

“At this time the chamber is starting to look into what we think might be some great long-term solutions, and it's our intent to do that with the city council members and community as a whole,” Evans said. “We just hope no quick decision is made about the long-term future of the food and beverage tax.”

Council members currently are expected to formally approve the new spending plan at their April 16 meeting.

“The debate of whether or not (the tax) is bringing in too much money is all about what the money is going to be used for, and those conversations have to happen together,” Evans said Friday. “At this point, we're just not in a position to say what the best use of that is and hope we can be the consensus builder among city council members and other community leaders to find that good, long-term solution.

“But if a decision is going to be made without any discussion, we would urge them to take a break on it for a second and let us all think about it.”

Evans stressed he doesn't think the tax is a burden to local establishments.

“The fact that revenue keeps increasing each year would show that it's not necessarily a burden on anybody,” Evans said. “It's a tax paid directly by a consumer and it's paid by everyone, not just Naperville residents, so that tax is very widespread. The fact that it continues to increase means it would be unfair to call the tax a burden.”

Council members say they expected to hear from the chamber and welcome members' input, but the end result likely will be the same.

“Their input is absolutely welcome, but we've already started that discussion,” Councilman Steve Chirico said. “I look forward to hearing what they have to say, but I happen to think we already have a good, balanced plan. If they have a better plan, let's hear it.”

Councilwoman Judy Brodhead stressed that no final decisions have been made, but she doesn't foresee any “special discussion” before the plan is up for a vote.

“It looks as though the city council is going to proceed according to plan, and I don't foresee any changes at this time,” she said. “I think our solution already solves a lot of problems for the city.”

Councilman Paul Hinterlong said he also looks forward to hearing from the chamber.

“If they can come up with options even better than what we've looked at, I'd welcome their thoughts,” he said. “We've got a good plan already, but if they have something better, I'm all ears and I'd imagine everyone else would be, too.”