People going out to eat in Champaign will likely start paying more when the bill arrives at the table.
Champaign City Council members voted tentatively last week to raise the city’s food and beverage tax, a move the city administration estimates will generate “an additional $6.2 million in recurring revenues.”
Having taken the initial step to raise taxes, they indicated they’ll decide later how to spend the money. That wait-and-see approach guarantees they’ll spend all the money because, after all, if it’s just sitting there, it’ll be really easy to spend on one thing or another.
The current .5 cent tax was adopted in 1998. It generates about $1.5 million a year.
From a percentage standpoint, the proposed food and beverage sales tax increase is a whopper — 500 percent. If formally approved, it will jump from .5 cents to 2.5 cents per dollar.
City officials inaccurately characterized the hike as a “2.0 percent increase.” It’s a 2-cent increase that represents an increase of 500 percent.
As a consequence, the food and beverage tax on a $75 bill for dinner and drinks will jump from 37.5 cents to $1.87.
That kind of increase isn’t going to send anyone to the poor house, particularly considering that people can choose whether and where to go out.
But it’s still a number that — in toto — shouldn’t be dismissed out of hand, particularly given its regressive nature. After all, it’s not just rich people who go out.
It’s hardly surprising that city officials have a long spending wish list because, after all, the demand for tax dollars is unlimited. There will never be enough to satisfy the various constituencies pursuing public dollars.
“In addition to fire staffing, there are several outstanding, recurring major underfunded and unfunded needs that cannot be accommodated in the city’s current budget. These include police staffing and equipment needs, support for community youth programs, resources necessary to respond to emergency weather events, support for diversity and inclusion initiatives, neighborhood services staffing and adequate funding for health insurance costs for employees who have been granted line of duty disabilities, and infrastructure improvements,” according to an administration memo to city council members.
The reality is that, in government, there are many worthwhile programs — at least on paper — while there is limited money to fund them.
In the private sector or in family households, those in charge are forced to live within their means. In other words, they establish priorities that require them to make do in some areas by doing without in others.
In the public sector, elected officials — often at the urging of the bureaucracy or influential interest groups — simply raise taxes high enough to meet the demand for spending.
From government’s perspective, that’s the neat, clean and, most important, easy way to do business. It is, of course, a different story from the taxpayers’ perspective.
Council members would be well-advised to pick and choose carefully from this municipal bill of fair. Public safety, with emphasis on law enforcement, and infrastructure are obvious top priorities. The rest might be nice — if resources were unlimited. But they aren’t.
That will require council members to do their job — govern — because to govern is to choose.