Happy Independence Day! As we celebrate America’s birthday, and begin the 250th year of our experiment in self-governance, I would like to share a few updates.
Local Issues
Grocery Tax v. Sales Tax – As I mentioned last month, a decision will need to be made by the city council as to how to best deal with the revenue shortfall created when Governor Pritzker made the decision to suspend the 1% tax on groceries, resulting in a $6.1 million budget hole for Naperville,
Recent activity by the council has shown a reluctance to reduce programs and services which could include staff layoffs including public safety positions like police and fire.
The choice will likely come down to either instituting a local 1% grocery tax or increasing the home rule sales tax by .25% across the board. While nobody likes to see taxes increase, the grocery tax option would simply replace the repealed state tax with a local tax maintaining revenue on a dollar-for-dollar basis. An ordinance to do this was introduced at the June council meeting and could be voted on (second reading) at the July meeting. Also at the July meeting, an ordinance is scheduled to be introduced (first reading) to enact a .25% increase to the home rule sales tax. NACC is NEUTRAL on the grocery tax increase and OPPOSED to the sales tax increase proposal.
IMEA Contract – The Illinois Municipal Electric Agency (IMEA) has extended the deadline for Naperville to extend their contract to August 19, 2025. Despite a recommendation from the Public Utilities Advisory Board to move forward with securing long-term energy stability, there continues to be resistance from some in the more hardcore environmental groups who favor a far more aggressive “green” energy strategy. As a business community, we have a responsibility to advocate for an electric delivery system that prioritizes reliability and provides predictable and affordable costs. NACC will continue to follow this issue through the upcoming workshops and will provide updates as developments occur.
State Issues
NACC would like to extend our most sincere gratitude to State Senator Seth Lewis (R-24), State Senator Laura Ellman (D-21), and State Representative Janet Yang Rohr(D-41) for joining us for our end-of-session wrap-up event. NACC Business Works Committee Chair Matt Shipley moderated an enlightening discussion that covered some of the most pressing topics for the business community that faced the General Assembly during the recently concluded spring legislative session. The group of legislators fielded questions raging from the record-setting $55 billion budget, to taxation, to mass transit & infrastructure, to energy, as well as discussing their personal highlights of the legislative session. Many thanks to all who participated.
Federal Issues
Legislation – “the One Big, Beautiful Bill” was signed into law on July 4th. The US Chamber of Commerce called the bill a significant victory for America, and that “The enactment of the One Big Beautiful Bill Act is a win for economic growth, a win for workers, and a win for communities across the country. Competitive, pro-growth tax policy is essential to strengthen the economy and raise wages for workers”.
The bill averts the largest tax increase in US history by extending the TCJA tax cuts. It also provides significant improvements by not taxing tips or overtime. Another benefit in high-tax states like Illinois, is that it increases the State & Local Tax (SALT) deduction from $10,000 to $40,000.
For businesses, it provides numerous benefits, including: an extension and enhancement of the deduction for qualified business income, full expensing of domestic research and experimental expenditures, increased dollar limitations for expensing of certain depreciable business assets, expansion of qualified small business stock gain exclusion, and enhancement of employer-provided child care credit.