How much would the proposed sales tax increases cost you?

Phyllis Gordan, 65, of Belleville, talks about the possible tax hikes in St. Clair County. Gordan said the increases would hit retirees especially hard. Photo by Steve Nagy, Belleville News-Democrat

Originally published March 9, 2017, by Belleville News-Democrat

“It’s hard to give when you don’t have,” she said. “When you’re on a fixed income and they say 1 percent more, that’s a lot of money.”

One of the proposed 1 percent increases would be used toward enhancing law enforcement and firefighting capabilities; it would end after 12 years. The other 1 percent hike would generate new revenue for schools in the county to use toward their facilities, as well as debt on past construction.

St. Clair County voters will be asked whether they support the increases in a pair of referendums on the ballot in the April 4 election.

If both referendums pass, the sales tax rate would increase by 2 percentage points in a county where the rates on general merchandise now range from 6.6 to 9.85 percent.

In Madison County, voters will also decide whether to add 1 percent to the sales tax rate for school facility purposes.

“The state law gives us a way to do this where everyone shares in the cost and not only that, everybody who visits here.”

Advocates say the money that is generated would be used to strengthen public safety and help provide property tax relief to residents in St. Clair County school districts.

Swansea resident Kris Rowe, who is retired from the military, said he would be willing to pay more to help law enforcement officers.

“I wore a uniform for 28 years — dangerous job — and their job is more dangerous than ours was, I think,” Rowe said. “Whatever we can do to make things more safe for our public servants, you bet.”

Each tax hike would bring in an estimated $22 million per year. For public safety, it would be split among several agencies, including municipalities for police or fire department enhancements; the county jail for renovations; the State’s Attorney’s and coroner’s offices and other areas.

Fairview Heights resident Janel Lacerna said she can tell the police in St. Clair County work hard. She and her family moved to the metro-east from the Chicago suburbs about two and a half years ago.

“It’s much different, and I appreciate that,” she said.

Coming from Chicago, Lacerna, 37, said she’s used to a sales tax rate as high as 10 percent, so she wouldn’t be opposed to an additional 2 percentage points in St. Clair County. She has three young children and lives in Pontiac-William Holliday School District 105.

“If I know it’s going to something that’s going to help the community, I will support that,” Lacerna said. “But it has to be benefiting the community, not in somebody’s pocket.”

St. Clair County State’s Attorney Brendan Kelly said money from the tax increase couldn’t be used to replace existing funding for public safety services. Instead, money would have to be used to bolster public safety, through adding police officers or upgrading the county jail, for example.

By law, schools would only be allowed to use the new revenue from the sales tax increase for specific costs like construction, maintenance, renovation or debt from previous work on facilities. The money couldn’t be used to pay for things like salaries and operating costs.

The new sales tax revenue from both hikes also wouldn’t go through the Illinois General Assembly’s budget process, which means it wouldn’t be subject to state cuts.

The county would distribute the new revenue for public safety.

Each of the 27 school districts in St. Clair County would receive a portion of the school facilities tax revenue from the regional office of education, based on student enrollment.

The Lacernas’ school district, Pontiac 105, plans to use half of its share on facilities projects and half on abating the property taxes that would be needed to pay its facilities debt. The owner of a $100,000 home in the district would see a property tax savings of about $28 in the first year, according to the district.

Rowe, 52, said he would also support a sales tax increase to benefit school facilities as long as “the money goes where it’s supposed to go.”

“I don’t mind paying for my local community,” Rowe said. “… You get what you pay for, so if I have to spend a little bit more but in the long run, the schools are better and the services are better, I don’t mind.”

Rowe noted that he lives comfortably as a professional in the medical field, so a higher sales tax wouldn’t affect him as much as the “average Joe.”

Henry Ordower, a Saint Louis University law professor, said a sales tax is generally regressive.

“The lower your income is, or smaller your wealth, the larger percentage of your income or wealth gets swallowed by the sales tax,” Ordower said.

“I wouldn’t shop with a smile anymore.”

Wealthier people tend to invest more money and are able to spend a smaller portion of their income on general merchandise, according to Ordower. He said a sales tax can be made more progressive by exempting food.

“The poorer you are, the larger percentage you spend on food,” Ordower said.

The proposed increases on the April ballot wouldn’t apply to groceries, medication or titled vehicles, which Ordower called a built-in buffer.

“That will help people on the lowest end, who have to spend most of what they have just to survive,” he said.

Proponents have said people from outside of the county would be contributing to St. Clair County schools and law enforcement through the proposed sales tax increase. They argue that St. Clair Square Mall, for example, is one of the only malls outside of St. Louis, which draws people from around the metro-east and elsewhere to Fairview Heights.

Andy Struckhoff is an associate director with PGAV Planners, a St. Louis-based firm that does municipal planning and market studies, among other things. He said there hasn’t been a study on how much retail sales are generated in St. Clair and Madison counties from people who live outside of the counties.

However, PGAV has done studies on other counties that have strong interstate traffic, like St. Clair and Madison counties, which are served by Interstates 64 and 55/70. Some of those other counties have already passed the school facilities sales tax.

Rock Island County, which is part of the Quad Cities area on the Illinois-Iowa border and has a U.S. Army installation, receives an estimated 18 percent of its general merchandise sales tax revenue from nonresidents, for example.

In Coles County, which has Interstate 57 and is the home of Eastern Illinois University, an estimated 47 percent of general merchandise sales tax revenue comes from nonresidents, according to a PGAV study.

Both Coles and Rock Island counties passed the schools facilities sales tax in November. The sales taxes are expected to go into effect in May.

Adams County, which borders Missouri and is where Quincy is located, has a quarter-cent public safety sales tax in place. An estimated 37 percent of general merchandise sales tax revenue there comes from nonresidents.

PGAV bases its studies on household surveys, household income, sales of general merchandise and census data to estimate how much sales come from residents outside of a county.

“We’ve used it for years and find it to be pretty reliable,” Struckhoff said.

Anne Noble, the managing director of public finance for Stifel Nicolaus, a bond-underwriting company based in St. Louis, said the non-taxable sales at Scott Air Force Base make it difficult to estimate how much outside money would be generated from the sales taxes in St. Clair County.

Struckhoff agreed.

“Scott Air Force Base, which is different, makes St. Clair different from a lot of counties,” Struckhoff said.

“I understand that things need to be met, whatever the taxes is for that they’re asking for now. But everybody’s asking.”

St. Clair County has not increased the amount of money it has collected in property taxes for county operations in many years, according to Sheriff Rick Watson.

“It’s coming to a point where they’re going to have to do it,” Watson said. “Why should only homeowners or property owners have to pay for this, where you could pay for it on a sales tax, where everybody pays, everybody who visits this county or comes here to shop pays it, too?”

Watson said ordering a meal at McDonald’s, for example, would cost an extra nickel.

“It’s easier to pay it a nickel or dime at a time than it is hundreds of dollars at a time,” he said.

“You can’t just keep beating up the property owners,” Watson added. “We look for a way here. The state law gives us a way to do this where everyone shares in the cost and not only that, everybody who visits here.”

Alton resident Jean Nasello, 65, made the trip to St. Clair Square recently to purchase two stuffed animals for her grandchildren from Build-A-Bear Workshop. If both sales tax increases were approved in April, the same pair of toys that Nasello bought for $70 would cost an additional $1.40.

But Nasello, who is retired from Alton Unit 11 School District, said she wouldn’t shop at the mall in St. Clair County if the increases take effect.

“I’d go across the river,” she said.

Watson said other people may want to avoid St. Louis and shop in O’Fallon or Fairview Heights.

“Why? Because it’s safer, and we want to keep it that way,” Watson said. “We want to make it even safer than it is now.”

“You get what you pay for, so if I have to spend a little bit more but in the long run, the schools are better and the services are better, I don’t mind.”

Another shopper, Rick Koonce, 40, of Belleville, said he’s opposed to the increases. He wouldn’t change his shopping habits, but “I wouldn’t shop with a smile anymore,” he said.

Koonce recently helped his son, Josiah, 15, pick out two new suits at St. Clair Square Mall for about $600. If both referendums pass in April, that purchase would go up $12.

Gordan, the Belleville resident who went back to work after retirement, said she’d keep shopping in St. Clair County, too.

“I understand that things need to be met, whatever the taxes is for that they’re asking for now. But everybody’s asking,” she said. “… I’d pay it. I’d come (to shop). But I’d be upset.”

BND reporter Joseph Bustos co-wrote this article.