Lincolnshire officials shelve plan to raise tax on theater tickets
Lincolnshire trustees have shelved a plan to boost the tax on tickets for live theater productions in town.
They were particularly moved by a letter from the Bricton Group, the company that owns the popular Marriott Theatre. Vice President of Operations Michael Yaneck said raising the village admission tax from 1.5 percent to 4 percent would drive away customers and "irreparably damage" theater operations.
"(It) is an unfair and unjustified burden," Yaneck said.
But proposed changes to the tax will resurface as part of upcoming budget and long-range financial planning talks.
"There are options," Trustee Julie Harms Muth said.
Trustees and administrators have spent months discussing whether to change the village's admission tax rate, which differs from sales tax.
The debate was prompted by concerns about the village's finances. Retail closures contributed to decreased sales tax revenue in 2016 and 2017, officials said.
To make up for some of the loss, trustees in 2017 raised the local sales tax by a half percentage point, created a 1 percent food and beverage tax and raised water rates by 5 percent.
Lincolnshire's admission tax on movie ticket purchases is 4 percent. Officials proposed setting the admission tax for both movies and live theater tickets at that rate.
Movie and theater tickets aren't assessed sales tax in Illinois.
Lincolnshire typically receives between $260,000 and $300,000 annually in admission tax revenue from the two venues, according to a village memo.
Officials also debated applying the 4-percent admission tax to athletic venues such as the Crane's Landing Golf Club at the Lincolnshire Marriott Resort, the Lincolnshire Club and the Par-King Skill Golf Course.
According to village documents, such a change would add: $1.42 to a weekend evening ticket at the Marriott Theatre; $2.36 to the price of a weekend round of golf at Crane's Landing; $1.92 to a typical summertime court rental at the Lincolnshire Club; and 38 cents to a weekend evening round at Par-King.
As part of their research, village staffers surveyed other suburbs and discovered few have amusement or entertainment taxes.
Those that do include: Hoffman Estates, which has a 6-percent tax on any amusement, athletic or entertainment ticket; Schaumburg, which has a 5-percent tax on any entertainment ticket; and Vernon Hills, which assesses a 4-percent tax on movie tickets.
Time isn't right
During a committee-of-the-whole meeting last week, Lincolnshire trustees agreed the time isn't right to expand the admission tax.
They were sensitive to Yaneck's concerns about the impact on the theater, which is one of Lincolnshire's premier attractions.
Absorbing the tax without passing it onto customers would cost the theater $200,000 annually and "would be crippling," Yaneck said.
And if ticket prices rise, Yaneck said, fewer people will go to shows, which would hurt the theater as well as local restaurants and other businesses patronized by theatergoers.
All of that means less cash for the village, he said.
Because the Marriott Theatre is the only such venue in town, Trustee Mara Grujanac called the proposed tax increase "punitive" against one business.
Trustee Tom McDonough agreed, calling the proposal "cruel and unusual." But McDonough also said he "wouldn't run" from raising the tax if it's needed to balance the budget.
The admission tax will be part of long-range planning discussions set to start this month, Village Manager Brad Burke said, as well as budget meetings in the fall.
Determining how much money a tax increase could raise will be a key part of the discussion, McDonough said.