Supporters of a Boone County sales tax increase continue to spread the word. Tuesday night, Poplar Grove residents shared their concerns about the proposed plan.
A one percent sales tax increase referendum is on the November ballot. It could increase Boone County sales tax from 6.75% to 7.75%. If it gets enough votes, revenue generated from that increase will help multiple school districts to pay off bond debt. The idea is that the sales tax would increase 1%, and property tax would decrease 1% county-wide. So, if you have a $100,000 home, you're saving $100 on property taxes.
"The money would go to where the students would go, so it would be divvied up between basically District #100 and District #200, North Boone." -says District #100 Vice President Doug Smiley.
Items like groceries, cars, boats, farm equipment, and medicines are not included in this sales tax increase. Those that are subject to sales tax include gasoline, processed foods, and clothing or supplies you buy at a store. Since District #100 schools approximately 85% of the county's students, District #200 would get about 15% of the additional sales tax revenue.
"If the sales tax was enacted, we'd still generate about $400,000 to $450,000 a year." -says District #200 Superintendent Steve Baul.
One Poplar Grove resident and village board member still sees issues with the possible tax increase.
"It does hamper a lot of municipalities when it comes time for them to have other vehicles to retire debt, and it leaves them in a position where they don't really want to raise property taxes, and a sales tax is a passive sales tax which really hits most of the people passing through the county, so if the school districts go ahead and take a one percent sales tax increase, it pretty much edges out the other villages." -says Poplar Grove Village Trustee Ronald Quimby.
At the meeting, proponents said District #100 owes $72 million dollars bond debt. District #200 owes $48 million. But, Belvidere Superintendent Michael Houselog says District #100's debt is from capital appreciation bonds. So, with interest, District #100's total is actually $179 million dollars owed.
Houselog also says that residents who live outside the county contribute to 35% to 40% of Boone County's sales tax. The goal is to have those outside residents help pay for the school districts' bond debts, instead of placing the financial burden entirely on Boone County residents.
If the referendum passes, the sales tax increase will begin July 1st, 2013, but Houselog says residents won't see relief in their property taxes until 2014.
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