South Beloit

South Beloit to vote on March 19 on 1% sales tax for roads

South Beloit residents will decide how much their City can spend on road improvements.

Michael McGinnis

Mar 13, 2024 — 4 min read

Stock photo of traffic in Chicago, where we don't live. Photo: Ben Schumin

As part of the March 19 primary election, residents of the City of South Beloit will vote on whether to adopt a 1% sales tax to pay for road work.

If approved, the 1% tax increase would take effect January 1, 2025. A sunset clause would end the tax on December 31, 2029, but voters could renew it if they wanted.

South Beloit Commissioner Ryan Adleman says, "The funds that would be raised by this 1% sales tax are legally obligated to go towards City of South Beloit roads only." Adleman serves as the city's Commissioner of Accounts and Finance.

The favorite feature of local road projects is that they remove potholes. The City of South Beloit does not maintain county, state, or federal roads. If you complain that the City hasn't fixed your pet peeve about Prairie Hill Road, you're right. They can't. That road is managed by Winnebago County and wouldn't be included in the road projects listed at the end of this story.

The City will hold a Community Input Meeting on the sales tax referendum on Wednesday, March 13, 2024, 4 - 6 p.m. at South Beloit City Hall - the smallest municipal hall in far northern Illinois - at 519 Blackhawk Blvd., South Beloit, IL.

The South Beloit City Council voted in favor of increasing the sales and occupations tax, saying that it would significantly enhance the financing of public roadways.

Needed: a cool million a year

In 2016, South Beloit's Engineered Road Study estimated that the City would need to invest $1 million a year to try to make headway on local road conditions. Since then, costs have only gone up.

One of the main source of money for roads was intended to be the motor fuel taxes (MFT). In fact, South Beloit has called its annual road improvement project the "MFT Streets Program." The problem is that this funding continues to dwindle as more electric vehicles hit the road (since EVs don't run on motor fuel). In 2023 the City of South Beloit received only $360,000 for Motor Fuel Tax from the State of Illinois.

The City currently has a 1% sales tax. If the referendum is approved, the sales tax on about 75% of items would be increased to 2% for five years.

Between August 2022-July 2023, the City of South Beloit received $1,456,000 from the existing 1% sales tax, but that went into the City's General Fund, not specifically into roads.

The uses of taxes

What have residents gotten for this money, if it wasn't roads? City Administrator Sonya Hoppes says, "Over the last five years, some of those funds have helped complete additional road projects, purchase fire apparatus, add police body worn cams" and have funded the completion or purchase of many other capital projects which Hoppes says were long overdue.

Based on the experience of neighboring communities who have passed an additional 1% sales tax, the City estimates that 65-85% of items would be subject to the additional increase. If it applied to 75% of items, South Beloit would receive an additional $1,092,000 in revenue - for roads - if the tax increase is approved.

Let the visitors pay for it

One of the questions about a sales tax is who will end up getting taxed. Nobody likes to increase their own taxes. But Hoppes says the residents of Wisconsin and neighboring communities are currently the City's largest sources of sales tax revenue. In particular, she cites the big gas stations and other businesses at Exit 1 off I-90, which would include a cannabis dispensary, usually crowded with residents of Wisconsin, where cannabis is still illegal.

But has South Beloit given up on having businesses where its own residents can shop, such as a grocery store? Hoppes says, "I have lived in South Beloit almost all of my life and I will agree that we desperately need a grocer. This is one of the first things that residents mention when you ask the question 'what would you like to see in South Beloit' and we have not lost sight of that need."

Ten projects for South Beloit

So what could South Beloit do with its roads if it passed another 1% sales tax? The current City Council and their revised Street Study identified the 10 most likely road projects - potentially one a year. Hoppes says, "The maps show a glimpse of what our current Motor Fuel Tax could complete, compared to what roughly four times the amount could complete" if the sales tax is passed.

For example, the first map shows that using only MFT funds, the City could afford to redo Roscoe Avenue from Northwestern to Olive. With the 1% sales tax, it could continue improvements the rest of the way, from Olive down to Prairie Hill. Each phase has five maps, each showing a similar "what if" scenario.

Hoppes continues, "The sunset clause is for 5 years, so we are suggesting that with the additional 1%, we could complete Phase I of the projects. Phase II is a glimpse at 10 years worth of projects with the additional 1%" - if residents later decide to continue the tax until the end of 2034.