On April 4, folks want you to increase your sales tax by 1 percent to create $23 million in annual taxes. They say it will reduce your property tax. Let’s look this fantastic gift horse in the mouth.
The 1 percent sales tax is a bonding issue. Madison County School Boards could bond $300 million to build new schools. Assuming 25-year bonds at a 1.25 coverage ratio it could cost up to a half billion dollars ($500 million) over the life of the bond. Sound great?
Question: Does the 1 percent sales tax guarantee your property tax will go down? Answer: No
Why? Illinois law defines the 1 percent sales tax as a “double barreled bond.” If sales taxes prove insufficient to pay for bond payments government will automatically levy higher property taxes to cover costs. Bureaucrats figured out folks grow angry about maxed out property taxes and now seek to raise sales taxes. It’s a “double whammy.”
Who gains? Perhaps those who contribute to passage. Contributors don’t report until after the election, so let’s consider some who gave last time. Stifel Nicolaus Bonding Co. $25,000, CTS HVAC, $10,000, L J Hart Bonding Co., $5,000, IPAC, $5,000, Kenneth Miller, Business Manager, Triad School District, $500, Robert Daiber, MADCO Supt of Schools, $350, and Michael Sutton, Highland School Superintendent $250. (Source: State Board of Elections) Think about it.
Does the 1 percent sales tax sound too good to be true?
If so, vote “no” April 4.
Philip W. Chapman, Highland