FOR IMMEDIATE RELEASE

Contact: Mayor Lewis
              Office of the Mayor
              618-242-6802
              mayorlewis@mtvernon.com

Elimination of Statewide Grocery Tax Poses Financial Challenges for Local Communities

Mt. Vernon, June 11, 2024 - Mayor Lewis today addressed the community regarding the recent elimination of the statewide grocery tax, which has been collected for more than 30 years. This change, while seemingly beneficial to consumers, presents significant financial challenges for local governments, including Mt. Vernon.
"While it's clear that some individuals have advocated for the elimination of the grocery tax, it is important to understand that this tax was not the cause of high grocery prices," stated Mayor Lewis. "Grocery prices have risen by 26% over the past five years due to increasing food costs, not because of this tax."

The grocery tax has historically provided crucial funding directly to local governments, with none of the revenue going to the state. The recent decision to eliminate this tax has allowed the state to gain positive attention without impacting its budget. However, local governments like Mt. Vernon are now faced with the challenge of compensating for this lost revenue.

"For a family of four earning less than $50,000 annually, approximately $1,000 per month in groceries is already tax-free through SNAP and other social service benefits," Mayor Lewis explained. "These benefits remain untaxed. Nevertheless, our cities and residents are bearing a significant financial burden with the elimination of the grocery tax. Mt. Vernon alone stands to lose $1.2 million annually. Other cities are also facing substantial losses: Marion will lose $1.7 million, Springfield $3.8 million, Rockford $8 million, and Chicago about $80 million. These figures represent real money that supports our communities, and this shortfall must be addressed."

Mayor Lewis emphasized that many communities will likely adopt the grocery tax locally to offset the revenue loss. "The reality is that while the state can claim it eliminated the grocery tax, most communities will adopt it locally. Consequently, consumers will see no change in their grocery bills. Without this local tax adoption, some communities face significant cuts to essential programs and services.

According to Mary Ellen Bechtel, City Manager, the City of Mt. Vernon has no plans to implement a local grocery tax at this time. “The Illinois Municipal League warned us early of this possibility during our annual budgeting process. So, we kept this in mind and were able to make some adjustments this year. The grocery tax was revenue in the general corporate fund that supports the operations of police, fire, public works, parks, and fleet services. It could have a negative impact in the future as this is a loss of $1.2 million every year. There may be a time when this loss begins to impact projects and services.”

"Inflation will continue to drive up food prices, and shifting the grocery tax from a statewide to a local level is a necessary step for some communities to maintain their financial stability," Mayor Lewis concluded. "We must be transparent about this necessity to avoid noticeable cuts to everyday programs and services."
For more information, please contact the Office of the Mayor.

# # # #