In This Issue

Cook County Tax Changes
Caustic and Corrosive Substances Act
Cook County Sheriff Takes Action on Retail Theft
City Council Activity

COOK COUNTY TAX EFFECTIVE DATES

Several tax changes passed as part of the Cook County 2012 Budget that will go into effect at the beginning of the year. Please note the following changes:

Sales Tax Rollback and Home Rule Tax Changes

As part of its 2011 budget, the County Board set in motion a rollback of the Cook County sales tax through 2013. The sales tax, which started at 1.75% was rolled back 0.5% in January 2011 to its current rate of 1.25%. On January 1, 2012, the rate will be rolled back again to 1%. The final rollback will occur on January 1, 2013 to bring the tax down to 0.75%.

IRMA would like to thank Cook County Board President Toni Preckwinkle and all of the County Commissioners who voted for the rollback which gives people more reasons to shop and increase sales tax revenue in Cook County.

Alcohol Tax

The alcohol tax was increased in all categories and will have an effective date of January 2, 2012. Please see the link to the alcohol conversion chart provided by the Cook County Department of Revenue. The increases are as follows:

• –Alcoholic beverages (other than beer) containing 14% or less alcohol by volume: increase from $0.16 to $0.24/gallon

• –Alcoholic beverages containing more than 14% and less than 20% alcohol by volume: increase from $0.30 to $0.45/gallon

• –Alcoholic beverages containing 20% or more alcohol by volume: increase from $2.00 to $2.50/gallon

• –Beer: increase from $0.06 to $0.09/gallon

Effective Dates

All relevant effective dates are listed in the linked document provided by the Cook County Department of Revenue.

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CAUSTIC AND CORROSIVE SUBSTANCES

Public Act 97-0565 will require all retailers that sell products containing caustic/corrosive acids which are regulated by the Federal Caustic Poison Act AND have a statement on the label that the product “causes severe burns” must have their customers sign a registry with identifying information of both the purchaser and the product prior to the purchase of the product. Such qualifying items for the registry would include some cleaning products, drain cleaners, paint products, art products and automotive products. Batteries are exempt from the Act. We encourage you to check your inventory to see which products are carried in your stores so that they are properly flagged in your system for future registration. Although not required by the Act, we have prepared a sign which you may find helpful to place near such qualifying products. We have also prepared a sample registry for use in your stores.

The Act preempts local jurisdictions from legislating in the area of caustic/corrosive substances; therefore the Chicago law passed last January which requires purchasers to register for any item that contains a caustic or corrosive acid will no longer be in effect on January 1, 2012.

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COOK COUNTY SHERIFF TOM DART CRACKS DOWN ON OUTSTANDING RETAIL THEFT WARRANTS

With the holiday season in full swing, Cook County Sheriff Tom Dart turned his focus to criminals who steal from retailers and whose actions drive up the price of goods for all shoppers. The Sheriff’s Office’s Central Warrants Unit set up an operation titled, “Last Point of Purchase” from December 5-9, 2011. This operation targeted shoplifters with outstanding warrants in Cook County and was lauded as a major success. Working alongside local police departments, the Cook County State’s Attorney’s office and the US Marshal’s office, the Unit made 60 arrests over the four-day period of the sting.

The persons arrested were wanted for retail theft, credit card fraud, identity theft and other crimes related to retail.

Organized Retail Crime is a serious threat to the retail community in Chicago, and by partnering with the Cook County Sheriff’s Office, IRMA’s members are sending a message that they we will not be passive about retail theft and that criminals in Cook County will be caught and prosecuted for their crimes.

IRMA would like to thank Sheriff Dart and his team for their great work in this effort and for their commitment to catching professional shoplifters and other participants in organized retail crime.

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Contact Information:

312/726-4600

In This Issue

MAYOR EMANUEL’S FIRST 90 DAYS
HEAD TAX UPDATE
BUDGET NOTES – 2012
CITY COUNCIL ACTIVITY

MAKE NO LITTLE PLANS –
OBSERVATIONS ON MAYOR EMANUEL’S FIRST 90 DAYS

Since his swearing-in, Mayor Rahm Emanuel has been a man on a mission.  The voters elected him to lead the city out of its current budget deficit, bring significant changes to its public school system, reduce crime, recruit and support businesses that would put people to work, and expand on Chicago’s brand as an international city with a thriving convention and tourism industry.  That’s a tall order for any person, but in his first 90 days, Mayor Emanuel has given us all an indication that he’s up for the challenge and willing to make the tough decisions to accomplish these goals.

In the first days of his term, Mayor Emanuel put together a transition team and cabinet that was heavy on business and government leaders who had achieved proven results in their respective fields and had the ability to bring a fresh perspective to city hall.  He and his team got straight to work on all of the weighty matters.  They took an account of the city departments and their functions, along with the city council committees, and consolidated where possible.  This streamlining will allow the newly merged departments and committees to focus, prioritize and reduce any duplication of efforts.

As much of the budget is dedicated to personnel-related costs, the mayor has been in negotiations with the unions regarding work rules that he believes will save the city money while protecting workers.  Similarly, although there was an outcry for hiring more police officers to deal with the city’s persistent crime, the mayor put more officers on the street by reassigning them from desk jobs and special task forces to patrol neighborhoods, shopping districts and public transportation.  He has managed to make the city run more efficiently without raising personnel costs, and his solutions are creative and fiscally responsible.

Not one to shy away from controversy, the mayor kick-started the discussions regarding the awarding of the concession contract at O’Hare Airport’s international terminal.  He made all of the necessary documents available to aldermen so that they could make their own determinations of whether the winning bidder was going to offer the city a good deal over the term of the contract.  Many aldermen noted that prior to this process, they had not yet experienced a deal that was as open and transparent.

That transparency has carried over to other areas of the city as all of the budget documents will be online as well as information regarding lobbyists and their contact with city officials.  His aim is to generally make city data, which is public data, available to residents for their own review.  As taxpayers, businesses and residents have a right to know that their money is being used in a way that will spur growth, and Mayor Emanuel’s administration will provide unprecedented access.

Importantly for the business community and residents, Mayor Emanuel has already recruited a number of businesses who have committed to bring jobs in the city.  He held a meeting with some of the top CEO’s of retail stores that sell groceries so that they could collectively discuss a plan to address the issue of access to fresh fruits, vegetables and meats in underserved areas.  We have already started to see smaller, urban-friendly concepts open in some neighborhoods, and many more innovative ideas are yet to come.

It is clear from all that he has accomplished in his first 90 days that Mayor Emanuel is a man of words, action and results.  Although his term has just begun, CRMA members can already tell that it’s a new day at city hall and we are encouraged by the continued progress.

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EMPLOYER’S EXPENSE TAX UPDATE

Since its inception, the Employer’s Expense Tax, commonly referred to as the Head Tax, has been an obstacle to growing businesses in Chicago.  Businesses that have at least 50 full-time employees and/or commission merchants must pay a tax of $4.00/month per employee.  This tax essentially penalizes small businesses that have become successful enough to grow and employ more people, as well as affects all larger businesses.

As a business owner, Alderman Tom Tunney knows first-hand how much the head tax has a direct negative effect on jobs, and he has worked tirelessly to keep this issue front-of-mind for the city council and the administration.  Alderman Tunney introduced an ordinance to repeal the head tax over the next four years in the face of a significant budget deficit.  CRMA testified in support of this ordinance and although a vote was not taken, Mayor Rahm Emanuel has publicly indicated that he will address the head tax in the 2012 budget.

While most governments are raising taxes on businesses to help fill their budget holes, Mayor Emanuel has shown true vision by discussing a tax repeal.  Removing this tax frees up money that retailers can use to hire more of Chicago’s residents, purchase equipment, and make improvements to and investments in their stores.  CRMA members look forward to seeing continued progress on this issue in the upcoming budget season and we would like to thank Mayor Emanuel, Ald. Tunney and all of the aldermen who have either signed onto the Employer’s Expense Tax ordinance or supported it publicly.

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CHICAGO 2012 PRELIMINARY BUDGET NOTES

Chicago’s Mayor Rahm Emanuel gave residents a hint last week of the city’s current financial condition.  The city predicts it will have a budget shortfall of slightly over $635 million with a continued projected shortfall into 2014 if significant measures aren’t taken now to reverse the course.

As noted in our previous discussion on the Head Tax, Mayor Emanuel is looking for opportunities to increase revenue that avoid the traditional tactic of raising taxes.  Instead, he is looking for ways to increase job opportunities which allows businesses and consumers to spend more and contribute to the city’s economy.  CRMA members believe that this is a sustainable way to help get the city operating back in the black.  In addition, Mayor Emanuel’s efforts to streamline government services for residents and businesses,  identify and correct government inefficiencies, and put certain city services out to bid are examples of the mayor’s resolve to handle the taxpayer’s money responsibly and address the city’s finances by controlling costs.

The mayor will propose the city’s budget in October with hearings on the budget set to begin soon after.  The process should be completed prior to the end of the year.  CRMA will keep its members informed on any significant changes.

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CITY COUNCIL MEETING – JULY 28, 2011

INTRODUCTIONS – ORDINANCES AND RESOLUTIONS

Ordinance to Allow the Suspension or Revocation of a License for Illegal Activites Being Committed on the Premises – Ald. Deborah Graham - Committee on License and Consumer Protection

This ordinance would allow a license to be suspended or revoked if an owner or employee violates such provisions of the Code as gang loitering, narcotics loitering or aggressive panhandling.  In addition, if a license is revoked for such behavior or any of the other prohibited actions under Chapter 8 of the Municipal Code, then that person will be ineligible to receive any license for a year from the date of the revocation.  The former license holder will also be barred from holding another license if they own at least 25% of the applying entity.  Also, if a business violates any section of Chapter 8 of the Municipal  Code at least twice within a 12-month consecutive period, it will be deemed to have committed a nuisance in violation of the Municipal Code and thus, may have its business license suspended or revoked.

In addition, this ordinance seeks to change the public nuisance procedure for liquor license holders.  It deletes the signature and resident proximity requirements for revoking a license and allows the Local Liquor Control Commission to initiate a hearing, if in their opinion, the license holder has failed to cure past violations.  The maximum allowable fine was also raised.

Ordinance to Change Boarding Requirements for Vacant Buildings – Ald. Richard Mell - Committee on Housing and Real Estate

This ordinance would shorten the time that a vacant building with an opening of more than one square foot in any area could be boarded up with plywood from six months to two months.

Ordinance to Set Requirements for the Complete Restoration of a Bituminous Surface - Ald. Richard Mell - Committee on Transportation and Public Way

This ordinance would require the complete restoration of a bituminous surface to the outermost edges of all openings if a utility, agency or company creates 3 or more separate openings for service or maintenance by the utility, agency or company on any block within a 4-month period.

Resolution Calling for Northstar’s Board of Managers to Testify Regarding their Business Plan and Potential Opportunities for Partnerships Within the Wards – Ald. Tom Tunney - Committee on Economic, Capital and Technology Development

This resolution recognizes that Northstar Lottery Group is the new private manager of the state lottery.  It seeks to hear from executives with the company on its plans for growth of the lottery and how additional revenue from the lottery will be distributed recognizing that there could be opportunities for partnership within Chicago’s wards.

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Tanya Triche
Senior Counsel
312-726-4600
ttriche@irma.org