Kane might tweak fees to address economic slowdown

Kane County might halt an increase in impact fees in hopes of spurring commercial growth as plummeting sales tax income becomes an increasingly menacing problem for the county's finances this year.

Impact fees are charged to land developers as a way to compensate for the increased burden their projects place on roads, schools, parks and other public services.

The county charges impact fees that are only a portion of the calculated impact. The impact fee rate is set to increase 8 percentage points every year on July 1 until it hits a maximum in 2011 of 64 percent of the calculated impact.

A new proposal will halt the 8-point increase scheduled for 2009, keeping the current multiplier of 40 percent.

"This is basically to avoid further exacerbation in the decline of residential and commercial development," Kane County Deputy Transportation Director Tom Rickert said. But the county confirmed the main concern is stagnant commercial growth.

That concerns stems, in part, from signs showing commercial businesses in the county are seeing sales slow more and more.

The sales tax trend pointed downward all year long as not a single month of sales tax income in 2008 even matched, much less surpassed, sales tax income from 2007.

"Unfortunately, the trend is now even becoming worse for us," said the county's budget guru, Cheryl Pattelli.

The county just finished collecting sales tax income stemming from shopping in November 2008. Totals, even with the Black Friday shopping day, show November was the worst month for sales tax receipts of the entire fiscal year.

November 2008 sales tax income was nearly 14 percent less than it was in November 2007. For the year, total sales tax collections were down by nearly 7 percent from 2007. Through November 2008, total sales tax collection was about $14.2 million; it was $15.2 million through November 2007. Sales tax collections in 2007 were down 1.6 percent compared to 2006, which was the last year to show an overall gain.

On the flip side, the county is also considering increasing fees in the county clerk's office for services such as marriage licenses, notary service and raffle licenses to help pay for the true cost of staff salaries to perform those duties. A total of six different services might cost between $1 and $4 more to increase revenue by about $24,000.

Fee: Sales tax collections down almost 7 percent for year