The condition of Woodstock’s infrastructure, taxes and business climate dominated discussion at a public hearing on a possible increase to the city’s sales tax.
Opinion was divided during the Aug. 1 hearing before the City Council, which stretched for about an hour and included statements from 17 residents.
“No one wants to pay more money for taxes. I am willing to do so, however,” said Woodstock’s Doreen Paluch. “I am willing to pay a modest amount more if the result is improved roadways and infrastructure.”
Some council members have proposed using a home-rule sales tax to help pay for street repairs and to offset a reduction to the city’s property tax levy. The sales tax rate on general merchandise — which excludes titled vehicles, groceries and medications — could increase to 8 percent if approved by the council, although officials could choose to increase it in smaller quarter-percentage point increments, which some residents favored.
“I think that a 1 percent tax would be too much,” said Woodstock’s Joseph Monack. He pointed to rates in neighboring communities, where sales taxes typically are lower than 8 percent. “… I think we do need to remain competitive vs. a city like Crystal Lake.”
Currently, the total sales tax rate in Woodstock — which is divided among the city, state and Regional Transportation Authority — is 7 percent, the same as in unincorporated McHenry County and many other local municipalities. McHenry’s rate is 7.5 percent, while Crystal Lake and Algonquin charge 7.75 percent. Lakewood and Lake in the Hills are the only municipalities in the county with a sales tax of 8 percent.
Some residents said incremental differences in tax rates don’t typically change people’s shopping habits.
“A large Diet Coke in Crystal Lake at McDonald’s costs $1.08. A large Diet Coke at McDonald’s in Woodstock costs $1.07,” said Carlos Acosta, a Woodstock resident. “To the naysayers of the sales tax increase, I should never buy a Diet Coke in Crystal Lake ever again because it costs more. … I don’t accept that.”
But others said given the chance, they prefer to shop in Wisconsin or other places where sales taxes generally are lower. Some retailers, too, expressed concerns about losing sales due to the increase.
“We already have people going to Lake Geneva for their big purchases if they’re willing to save $100 [or] $200,” said Don Hess, who works for Woodstock Lumber, which sells building materials.
Woodstock’s John Stassen cautioned the council against creating the perception that doing business in Woodstock is expensive.
“It’s not so much 1 percent and whether I can afford it or not. I can,” Stassen said. “It’s about people’s sense of their taxes, the sense that when I’m come to Woodstock, I’m going to spend a little bit more.”
If approved at 8 percent, the new sales tax could bring in an estimated $2.34 million in yearly additional revenue, according to city documents. The council will vote on the sales tax increase at its Tuesday, Sept. 19 meeting.