Naperville moving cautiously toward sales tax, garbage fee increases

  • Come Sept. 15, Naperville City Council members could decide to add a home-rule sales tax of up to 0.5 percent.

      Come Sept. 15, Naperville City Council members could decide to add a home-rule sales tax of up to 0.5 percent. Marie Wilson | Staff Photographer

Updated 8/19/2015 10:21 AM

Naperville City Council members say they don't want to rush into adding a sales tax or increasing garbage rates to help solve the financial problems of a budget deficit and reserves that have fallen below required levels.

But they took steps Tuesday night toward potentially approving such revenue-generating moves by the middle of next month.


Proposals on the table after the meeting could bring in $5 million a year from increasing garbage fees and could generate up to $8.5 million a year by adding a home-rule sales tax of up to 0.5 percent.

The proposals could help solve a budget deficit projected at roughly $6.8 million and help address the fact the city has about $18 million less in reserves than needed to meet required levels.

Mayor Steve Chirico said now is the time to address the financial challenges the city faces.

"I think it's a terrible idea to delay," Chirico said. "I can't think of one good thing that can occur with doing that. It increases our debt, it increases this mountain we have to climb. It does kick the can down the road."

The city will begin discussing the garbage fee and sales tax proposals Sept. 1 and could take action on them as soon as Sept. 15.

Options for the garbage fee include charging each household an additional $10.35 a month to bring the total to $12.35, which would generate $5 million a year, or adding the $5 million to the property tax levy, which would mean homeowners would pay a proportional share of the increase based on the value of their house.

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Council members will debate whether the sales tax should be implemented at 0.25 percent, 0.5 percent or not at all. If approved Sept. 15, the home-rule sales tax could begin to be charged Jan. 1.

But several council members and public speakers including Rosemarie Breske Garvey, chairwoman of the Naperville Area Chamber of Commerce, said the move to add a city sales tax to the 7.25 percent rate already charged in Naperville by other governments, starting with the state, feels rushed.

Breske Garvey said the chamber opposed the sales tax when it was originally proposed at 1 percent. She said it would put Naperville businesses at a competitive disadvantage because people will think taxes are higher there than in surrounding communities, even if that's not actually the case.

"This is a new tax as opposed to taxes that are already in place," Breske Garvey said.

Council member Kevin Gallaher said he would want to "scrub the budget" before raising taxes.


"I don't feel comfortable voting to increase the sales tax at this time because I haven't had a chance to do what I think is my job," Gallaher said. "And I don't feel that I'm being responsible to the residents of this community until I've had the opportunity to do that."

Tuesday's discussion was based on three financial principles that had been tentatively approved last week:

• The city will pass a structurally balanced budget each year.

• The city will commit to continuously improving delivery of necessary, cost-effective services.

• In the next eight years, the city will work to increase its reserves by 25 percent and reduce its debt by 25 percent.

The principles were given final approval in two separate votes Tuesday. The first two principles passed unanimously. The third principle about rebuilding reserves and reducing debt was approved 5-4 with council members Kevin Coyne, Patty Gustin, Paul Hinterlong and Rebecca Boyd-Obarski voting against it.

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