Geneva residents OK sales tax increase

Geneva residents favor doubling the city's portion of sales tax to give the city about $2 million more a year.

With all 19 precincts reporting, unofficial results indicated 3,015 voters said "yes" to the half-cent-per-dollar increase, and 1,917 voted "no."

The increase will take effect July 1.

Through Dec. 31, 2020, the money can be spent on operations, infrastructure and property tax relief. After that, under current law, it can be spent only on infrastructure.

If voters had not agreed to increase the sales tax, city officials planned to start charging a 2 percent places-for-eating tax starting May 1. Restaurant owners, particularly those in the downtown area, had protested that proposal, saying it would be unfair to target their industry.

The Geneva Chamber of Commerce favored the sales tax, and opposed the places-for-eating tax.

The tax will not be charged on groceries, medicines, medical supplies and titled personal property such as automobiles.

With the increase, the total sales tax rate will be 8 percent, the same as that in St. Charles and Batavia.

Geneva officials have talked about whether to institute the places-for-eating tax or ask for a sales tax increase for at least two years. Because it is not a home-rule community, it had to ask voters' permission to raise the sales tax. It adopted a places-for-eating tax in October 2016, intending it to take effect Jan. 1. It later delayed implementation, and last April voted to drop it.

City officials say the city needs the money to speed up replacing equipment such as fire engines and maintaining and repairing infrastructure such as streets and sewers. It also will lessen the city's reliance on income tax distributions from the state.

In recent years, the state has taken 10 percent of the income tax payment that is supposed to go to towns. It also started taking 2 percent of the local sales tax it collects on behalf of towns, calling it a collection fee.

The city's general fund pays for operations other than electrical, sewer and water utilities. Sales taxes provide about 29 percent of the money, followed by property taxes at 27 percent. Fees, fines, permits, utility taxes and state income tax account for the rest.