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The meeting of the Cook County Independent Revenue Forecasting Commission will now come to order. I will now call the roll. Chair, Commissioner Davila, Commissioner Merman, Commissioner Falen, Chair, you have a quorum.

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Good evening everyone, and welcome to our meeting of the independent revenue forecasting commission and my first is chair.

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It's nice to be here with all of you tonight. Before we begin tonight's agenda items,

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I wish to recognize the hard work and collect the efforts of everyone in this room,

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the Bureau of Finance and the Dynamic Commissioners. Thank you for everything you do.

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Today, we're going to discuss some potential recommendations of the IRFC, which will not be finalized until August.

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Additionally, we will provide quarterly updates, which include updates on our bus sustainability.

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We are also going to go through some exploratory scenarios assessing methods to grow existing revenues.

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I think this can be a useful thought exercise to understand and refine our modeling and to get

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a more comprehensive look for counties who have a new picture.

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I look forward to this group's inside an input, and finally we will also be diving into

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the county's sales tax.

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So again, thank you to everyone for being here and we can get started with the meeting.

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The first item on the agenda is the approval of the minutes from the meeting of student

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30th, 20, 26, fair. We need a motion to approve the minutes to proceed. Is there a motion to approve the minutes? Yes. Is there a second? Okay. The motion to approve has been moved by Commissioner

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for Bayland and second-by-commissioner Miriamen.

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All of those in favor signify by saying, yay, yay.

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All of those opposed signify by saying, yay.

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Any opinion of the chair, the A-savit,

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and I'm sorry, and the meeting minutes

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will be filed with the Cook County Secretary of the Board.

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The next item on the agenda is a presentation

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from the team covering quarterly updates,

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the county's sales tax and the preliminary IRFC recommendations.

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And it's, is it?

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Yeah, thank you, Angela.

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So we'll have some updates this evening on some of our deliverables

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as they relate to the principles of the aisle.

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See here and your recommendations of this body,

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which we'll get into on the next slide.

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So,

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regarding the impact of Oba, the Oba provisions on the health enterprise fund, we recently analyzed the budget from states.

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There wasn't a lot of information in there that would change any guidance as far as forecasting goes to the health fund.

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So, you know, we'll be continuing to monitor any information that comes down to the state continuing to work partner with our friends at the hospital.

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One thing to note those at the state is continuing to fund health benefit for immigrant seniors, their budget, which we have built in, we'd be a reflective that in our June forecast.

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Art of the Sustainability, the county that is currently fine to hearing its allocation,

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it's practically, but you are per reserve, it should have set up a couple of years ago.

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And then revenue growth options, which will dive into on the next couple of slides.

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So this year, the team, we conducted an analysis of county tax revenues,

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I tend to find reasons for a slower declining growth, and some refugees understand why

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they're stagnant.

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I'm going to share some updates at the January and April meetings on our findings.

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But on the next batch of slides here, we'll walk through some exploratory scenarios

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and what modifications would look like to existing taxes in the county's budget.

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Okay, so as Angela noted,

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We'll be going through some of the county's revenue sources in this section, exploring some scenarios, what different modifications and estimator revenue impacts would potentially look like, as well as providing some background into our methodologies to estimate these impacts.

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And so the first revenue.

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Here that we looked at is sales tax. Seeing what a potential modification would look like in the county sales tax. So the, the county's current sales tax read is 1.75% and so we have a scenario of here of what that would look like if it were to increase a quarter per cent to 2%.

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So it's estimate what the revenue impact would be from this modification, and we'll also be talking about this, the sales tax a bit more presentation, but we use our current sales tax model, which is a regression model that is used to predict the sales tax base.

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We adjusted the tax rate to 2% effective January 127, which would be right now the earliest

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of the county would be able to implement that change per state statute.

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So this January 1 effective date would mean that the county would begin seeing an impact

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from the Modification in April of 2027, which accounts for the lag

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from when the state who administers the tax for us,

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collects it and eventually disperses it to the county.

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A key assumption in this modification is no change

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in the purchasing behavior of consumers

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from this potential rate increase.

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And so the projected revenue impact from this modification here,

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that we're estimating fiscal year,

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$177 would be approximately $141 million higher

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from the current projection of the prior forecast

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of the sales tax.

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But then in the impact would be about 200 to 220

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and 2028 and into the out-years.

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So, this full year impact of 200 and 1 million,

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It's about 14% higher than the forecast of projections for 2028 into the fifths of the outshars.

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So the self-sex rate is going to go up. Maybe you can might have gone up today.

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Right. Because it's first.

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Yeah. Yeah.

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You speak up to you.

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So it's going to go up, have you have any projections about what, you know, that to

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lower your revenue, if it pushes out sales, do you have a projection of that? And then,

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you know, the projection of this would also perhaps be, there's an interactive of that.

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So I just wonder, do we have any idea of what that ought to do?

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We're having x-forward that yet, what's a surrounding,

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if that were to increase how that would impact our base in potential sales.

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So guess, okay, yeah.

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And then,

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I guess, so the 14% difference, 14% increase in revenue,

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So, is it essentially essentially essentially assuming it's just linear?

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Because it's 25% over 1.75.

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Yeah, I'm trying to do the math in my head, but that sounds about right.

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That's essentially what you're assuming, right?

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Okay.

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Okay.

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So, I think we had some discussions before,

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You know, we would say that's optimistic, assuming that, you know, if I call some drop-off

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and sales. So it just seems like I should note that. Yeah. Yeah, correct. Yeah, that's,

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let's see, there's no back

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-to-voinance. That's not a back-to-here. This is just simply no change in

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lots of the basic consumer behavior. Mm-hmm. Is there a way to look at past increases to

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to confirm that or to sort of back that out

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to happen in the last decade there.

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We could certainly take a look at that.

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I'm sure we have data to be able to do that.

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I have very few actual instances that we could look at.

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So I mean, you could do an analysis,

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but I'm not sure how.

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Well, there's one is the implementation

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and whether or not it rolls out perfectly.

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See you in the next video.

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You're also looking at a handful of instances where we would be directly impacted. So you're now a sample size that would be great.

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Yeah, you could make some assumptions. I think the issue is that right now most of online sales are covered.

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So before when there would have been an increase, there would have been a bigger opportunity for avoidance.

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because a lot of the goods were still being touched at the six and quarter percent.

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Worst Nye, you've got pretty much everything to be in the times that the how right.

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So, I'd say more of a reduction in consumption rather than any kind of deviation.

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I'll be here if you're into Wisconsin or North Carolina because that's pretty much

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tapped. Back to David's point, did you look at the RTS to Mountain,

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but what were they assuming in terms of elasticity

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for their revenue increase?

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I did not look at it personally.

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I think my coal may have, fortunately it's not here,

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but I think that might be a hell of a conversation

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to have because that wouldn't be discussed.

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I would think of life in the state legislature.

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Yeah, they cover, is that restricted to the county

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or it's a bigger area?

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It's bigger.

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I guess one, I just concerned because the rate is very high in Chicago, probably top of the highest rate in the nation, and I'm just worried that there's a breaking point, that's why I, so to say.

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Well, would it be a, like, what do you mean by breaking point?

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We already just people had effects, people's consumption or houses tax of like, you know, I mean, I'm really, I'm really doing hand waving here.

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But at some point, people had to say, you know, this is ridiculous. I'm going to make the effort to go to a different county or do something to avoid the sales tax.

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becomes really, you know, the skull, when it's. Yeah, and you know, I think that's worth

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while we search in like, what opportunities would there be to go to another kind of

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to get a lower tax rate? Because I'm not sure with all these recent changes at the state of

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level. I'd beg of a factor. That is anymore. I mean, it used to be like, you know, we need to be

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saw that with gas. He said, we're at someone ever, but I'm not sure, but it's, so I would just see

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world reduction in consumption? Yeah. Well, I don't know. I mean, I think the most of

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kind of the most relevant point for policy is just to set, you know, give it some

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other balance and lower balance. I think you're really at the upper balance. Yeah. And what's

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a reasonable lower balance? Yeah. Yeah. And it might be a signal.

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In another way, it might not just

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that like articles that they used up buying it or you look to buy somewhere else, but essentially

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your budget is depleted at some points, so you don't buy something.

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I'm thinking about that. Yeah. In that way, it's not like this concept and you're getting

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to think this about your constraint that gets hit at a certain point, so you don't end up going

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that extra me or something.

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Soon some level of rigorous consumption associated with the increase

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in the sales sector.

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Once possible, you could look at that, um, that's good. People spend

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money on the consumer, whatever. Because if it's services, they're more likely to drop off than

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it doesn't matter because they're not taxed. When I say, I don't, I'm being flipping. It's not

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going to affect your sales tax revenue. If people reduce the consumption of services,

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but if they're constrained, forces them to reduce their consumption of goods, then that's a different

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creation?

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Yeah, I mean, it's helpful to know. I think we've talked about this a little bit.

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It would be helpful to know really where your sales tax revenue is coming. What are the

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what are the big drivers?

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As I see code perspective, if you will,

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or.

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It's like sick codes. Yeah, I don't know. Yeah, I mean, now you have data right, you actually

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data, the level of entity, right? And maybe you could do some analysis of that to think

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about, like, where's the volatility in that? And I don't know how much you can think

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of it. What kinds of things are selling? Is it like restaurants? Look, I always think

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of it as cars, but it's not cars, it's apparently because it's handled differently.

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Here. So I don't know what, really, the components are. It's driving sales tax revenue. And look at it. It's pretty even across all of the sick codes that we have.

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There's every call and have to look at it. I'm pretty sure we have. I think we have an analysis and our rating. You can see presentations. It speaks directly to the industry closed set ourselves reported

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regarding like the sales tax collection rate.

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And the whole thing that we always say when we present that slide is that, you know, it's, it's pretty, um,

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going across all of the different areas. There's no like, um, in like one particular component that is outweigh, like the rest of what the nation see.

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I mean, it's good, it's diversified, that's probably some precision.

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That's the arts in the side.

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I think the S.I.C. called categorization, and I'm sure you know this is not to be relied upon because it's arbitrary if they don't choose.

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And it's supposed to be the top two things that are so it could be anything.

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But to do it's quite not that you have the data for like some big players.

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So, just looking at them by, not by the SIC code, but by their volume and then I think

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you're right, I think there's nothing that really dominates, but just to verify that

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that's the case and then you know, you should judgment on what industry or what SIC

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code or whatever they should fall into and like it's more like relying on that SIC code

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Is problematic. Yeah, I think like we've I ever call talking about this. You've just like internally

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You'll feel like the last couple years like we kept that out of a presentation. Yeah, for that reason

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Yeah, there's always so much

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Yeah, you don't you don't want to make too many

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Judgments from different that itself reported. Yeah, but we have we have started

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with having more data now to things like top 100, you know, starting to compile that, that's something

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down there from a high level.

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So, yeah, we can continue to expand on that, but obviously categorize it in different ways.

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but it's very careful and, like, obviously, you can report that information publicly.

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No, yeah, yeah, yeah.

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Or internal purposes, we could look at, say, the top sellers,

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in terms of contributors to the sales

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sector.

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Certainly.

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It's like

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the idea of having a bounce on what could be potential impacts, the elasticity,

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be the production and consumption of certain, I think that makes a lot sense, we're breathing

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to our forecast and making a judgment call about what we are incorporating for our estimates,

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using the kind of straight methodology forecast as our faith, just to be a little bit more

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conservative.

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So the next revenue we look at that is our property tax

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let me specifically house of mental modifications

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in the property back and forth would impact the allocation

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of that levee that goes into the general fund.

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So just some background, Cook County's property tax revenue

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comes from a base tax levee, as well as from expiring

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statistics, expiring, incentive, incentives, as well as new property construction. So the county's base property tax levy is approximately 720 million that amount has not been adjusted dating back to the 1990s.

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And in addition to that, based property tax, the total levied for fiscal year 2026,

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it included about $100 million to handle property taxes captured from these new properties,

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the expiring tips, districts, and expiring incentives, cumulative from previous year.

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So, after this call like a gross, levee is calculated, portions of that levee are allocated for the purposes covering debt service obligations, allocations to the annuity and benefit funds,

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after all projects, as well as the election funds.

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A portion of the levees also allocated has been allocated each year to support health and

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enterprise funds for their operations, and then the remaining amount is what's allocated

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into the general fund.

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So in fiscal year 2026 approximately $120 million was, and property tax revenue was allocated

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and the general funds.

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So one scenario we explored is adjusting the base levee,

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that's 720 million, increasing the base to keep pace with inflation,

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starting in 2027 into the out-years.

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We utilized Moody's baseline CPI forecast for the Chicago metropolitan statistical area.

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While it was not a factor in our projections, we also would have assumed a cap on the annual inflation.

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So that an increase in the base level would not ask 3% in any given year.

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00:21:33,160 --> 00:21:44,820
The revenue impact to the general fund would be about $20 million of additional property tax revenue allocated to the general fund in 2027.

216
00:21:44,820 --> 00:21:54,720
That's about 17% greater than the amount we were projecting for 2027 before this, and as you

217
00:21:54,720 --> 00:22:03,420
could see, that amount increases in 2028 into the out-years, as the face would increase

218
00:22:03,420 --> 00:22:04,120
with inflation.

219
00:22:05,460 --> 00:22:12,560
And then a second scenario we explored is a one-time adjustment to the total gross

220
00:22:12,560 --> 00:22:20,900
level retroactive to 2020. So increasing the base levee as well as the levee coming from these

221
00:22:20,900 --> 00:22:28,140
expiring incentives, tips, and new properties if they had both thrown annually with inflation

222
00:22:28,140 --> 00:22:35,680
dating back to 2020. So the revenue impact to the general funds from this one time adjustment

223
00:22:35,680 --> 00:22:46,180
would be about $170 million in fiscal year 2027 and into the out-years since it would be

224
00:22:46,180 --> 00:22:55,060
just in the scenario one time increase. And so we utilized CPI for all our urban consumers

225
00:22:55,060 --> 00:23:01,720
for the BLS to come up with these estimates for the second scenario here.

226
00:23:06,460 --> 00:23:09,920
All right, Missy, can you say when the last time the piece like it was adjusted?

227
00:23:10,460 --> 00:23:15,060
It was close. I think it was 1996. Yeah, and

228
00:23:17,680 --> 00:23:20,280
so nominally it's been flat, but I guess

229
00:23:20,280 --> 00:23:23,540
you think of it as like real, it's been second.

230
00:23:27,670 --> 00:23:29,770
Does that sound as a 24% increase?

231
00:23:30,370 --> 00:23:30,910
Yeah.

232
00:23:38,560 --> 00:23:43,300
I suggest it when we that before, when you breathe in, I'm just that one,

233
00:23:43,300 --> 00:23:48,900
one other way to think about it would be thinking about keeping the tax rate

234
00:23:48,900 --> 00:23:53,300
rather than the gross amount of constant,

235
00:23:56,240 --> 00:23:59,040
which you could pick whatever year's tax rate in one.

236
00:23:59,080 --> 00:24:00,900
The tax rate's obviously been falling.

237
00:24:01,480 --> 00:24:04,300
The base is going up and up.

238
00:24:08,860 --> 00:24:12,360
It's sort of like keeping the tax rate constant.

239
00:24:12,520 --> 00:24:17,840
It's almost like saying the property tax burden

240
00:24:19,220 --> 00:24:23,380
at this per dollar, real estate wealth is not going on.

241
00:24:29,420 --> 00:24:38,440
different forperated that is by the addition of new property and the tissue that is

242
00:24:39,580 --> 00:24:48,360
you just fired to inspiring incentives. So we try to capture that natural growth in

243
00:24:48,360 --> 00:24:54,700
the tax base whenever the issue, whenever we develop the levee,

244
00:24:57,050 --> 00:24:59,150
started doing that, I think in

245
00:25:00,750 --> 00:25:05,410
I don't remember the exact date, but it was probably about seven years ago.

246
00:25:11,230 --> 00:25:33,160
They don't think that's kind of, look, one way of doing it. But like I think what you were, you were suggesting, it's like, what did we have, what if we knew the assessed value beforehand, right? And then back into our total property tax, levy based on that. And I don't think we would know that until, let's read looks retroactively.

247
00:25:33,160 --> 00:25:38,800
Well, I mean, you could look at what the rate was. You know, the rate's been going down.

248
00:25:40,020 --> 00:25:44,460
And so it's supposed to be, it's not down by eight percent.

249
00:25:44,500 --> 00:25:44,760
Yeah.

250
00:25:45,140 --> 00:25:50,420
But if you raise the level by eight percent, you sort of get to the same place.

251
00:25:50,520 --> 00:25:52,120
I mean, you can do something on the side.

252
00:25:52,920 --> 00:25:55,540
Yeah, I don't know this necessarily better than this.

253
00:25:55,900 --> 00:26:00,040
It's kind of like intuitively the way I would think about it.

254
00:26:00,040 --> 00:26:05,420
That's kind of what you're doing with the sales tax, like gas, with the sales thing.

255
00:26:05,740 --> 00:26:08,680
You're adjusting the rate, I guess, with the sales tax.

256
00:26:10,760 --> 00:26:11,400
Just

257
00:26:22,250 --> 00:26:30,530
for our jump in, this slide will go over amusement tax, where we create a two different

258
00:26:30,530 --> 00:26:36,870
proposals to address the revenue growth to give some context, currently amusement tax that they

259
00:26:36,870 --> 00:26:44,850
administered by a three-tier system was right set at 1% 1.5 and 3% for each tier.

260
00:26:45,930 --> 00:26:51,850
Now, the first proposal is pretty straightforward where we suggest a flat rate across all

261
00:26:51,850 --> 00:26:59,090
tiers at 3%. This adjustment would only be an increase to tier 1 and 2, both of those would now

262
00:26:59,090 --> 00:27:05,870
go to 3%. Well, tier 3 would remain unchanged. On the methodology here was used in our

263
00:27:07,150 --> 00:27:25,870
historical revenue data to calculate the tax base for all tiers, then apply that new rate for each tier and at the bottom we can see the projections for proposal one as roughly 15 to 16 million a year and additional revenue.

264
00:27:25,870 --> 00:27:28,170
We're proposing two.

265
00:27:29,170 --> 00:27:35,630
We incorporate a tier structure and the addition of streaming tax base.

266
00:27:35,930 --> 00:27:38,090
We saw a lot of opportunity here.

267
00:27:39,130 --> 00:27:44,350
As we see the city of Chicago already implements a streaming tax.

268
00:27:44,990 --> 00:27:49,350
So our Department of Revenue conducted an analysis of cities revenue from streaming.

269
00:27:49,350 --> 00:28:02,470
We incorporated those estimates into the county forecast for amusement in the out years and for streaming alone that would bring in 33 million annually.

270
00:28:03,530 --> 00:28:09,490
The breakdown of the tier restructure, this is shown in the methodology section.

271
00:28:09,490 --> 00:28:14,850
They address and it's drafted to be consistent with the cities of amusement ordinance language

272
00:28:15,810 --> 00:28:24,700
This means tier one now be exempt tier two and three are both sets at the flat rate of three percent

273
00:28:25,670 --> 00:28:29,090
For tiers one and two the criteria changed and

274
00:28:32,280 --> 00:28:41,160
60% of tier one would be a reclassified and elevated tier two ultimately increasing that tier two base

275
00:28:42,140 --> 00:28:54,640
And with both of these changes, the tier restructure and the streaming, we can see the total impact of proposed two is around $45 million in additional revenue.

276
00:28:56,440 --> 00:28:58,980
And the streaming is taxed to 3%.

277
00:28:59,620 --> 00:29:00,320
Is that right?

278
00:29:02,060 --> 00:29:08,300
So, when we did the analysis on the city of Chicago, they tax at 10%.

279
00:29:08,300 --> 00:29:15,920
percent. So they take the 10.25 I think it is. So our estimate right here will probably be

280
00:29:17,080 --> 00:29:18,540
along those levels

281
00:29:21,230 --> 00:29:22,810
just for the string at

282
00:29:25,950 --> 00:29:26,710
all.

283
00:29:26,910 --> 00:29:31,330
Oh, she knows her. She doesn't have jumped in. Yeah. Tina go ahead.

284
00:29:32,310 --> 00:29:42,670
I believe that this reflects the tax rate of 3 percent on the taxable base that we

285
00:29:42,670 --> 00:29:45,750
us from the city's records from no data.

286
00:29:48,240 --> 00:29:51,140
The proposal should be that the tax is the same

287
00:29:52,320 --> 00:29:58,800
way across. Yeah, three percent. You're adding string into your base, I think. Yeah.

288
00:30:02,290 --> 00:30:04,710
Thanks Tina. We're welcome.

289
00:30:15,980 --> 00:30:16,680
We know anything,

290
00:30:19,220 --> 00:30:26,480
I guess that I also wonder about the vision of avoidance from screening. I don't know how easy that is to do.

291
00:30:27,040 --> 00:30:32,460
We register a different address. It's not the impacts or something.

292
00:30:34,320 --> 00:30:37,200
I guess you had a call. City of Chicago will find out.

293
00:30:41,660 --> 00:30:45,420
Yeah. You think this would be more elastic to that in terms of like projections.

294
00:30:45,420 --> 00:30:51,480
again, you're assuming that there's no change in pattern, but, you know, you can get entertainment

295
00:30:51,480 --> 00:30:56,940
in different ways of these things to whatever. So this, it might be, this might be more,

296
00:30:58,320 --> 00:31:06,020
more elastic. Basically, yeah. I'm sure you guys will see it with a 10% tax, then you're adding to that.

297
00:31:06,020 --> 00:31:16,160
So people are kind of filled with the elasticity of the other or we put it in the past.

298
00:31:16,280 --> 00:31:18,420
It's your land now.

299
00:31:18,520 --> 00:31:19,000
Yeah.

300
00:31:19,020 --> 00:31:20,120
I don't know.

301
00:31:20,280 --> 00:31:21,240
I got subscriptions.

302
00:31:22,040 --> 00:31:23,700
I don't need four at once.

303
00:31:24,040 --> 00:31:25,200
Passwords share the same.

304
00:31:27,380 --> 00:31:28,920
But you could still create it.

305
00:31:29,060 --> 00:31:32,160
I mean, like, you could, you could avoid these taxes.

306
00:31:33,800 --> 00:31:33,920
Yeah.

307
00:31:33,920 --> 00:31:42,140
I don't know if there's a literature on it at all. But anyway, again, it's probably just to say this is a very optimistic effort.

308
00:31:42,620 --> 00:31:44,120
You know, so be it.

309
00:31:44,700 --> 00:31:44,720
Yeah.

310
00:31:44,940 --> 00:31:49,180
And I think with some of the consumption things that I meant before, I was going to be interactive effects.

311
00:31:49,600 --> 00:31:54,180
You know, so like these are estimates in isolation of an individual tax.

312
00:31:54,460 --> 00:32:00,120
But if three of them were implemented, then some of those things might come to bite a little bit more.

313
00:32:02,420 --> 00:32:03,100
And

314
00:32:13,020 --> 00:32:20,500
here we have Gamble Machine Tax, for Gamble Machine Tax, we administer emblems for probably Gamble Machines.

315
00:32:20,920 --> 00:32:28,080
We thought the opportunity here was to increase the cost video gaming terminals, also called VGTs.

316
00:32:29,400 --> 00:32:38,020
The cost of these emblems from 200 to 500, VGTs are just gaming terminals, but these are

317
00:32:38,020 --> 00:32:42,180
ones you've found in Mom and Pop stores, not casinos.

318
00:32:42,280 --> 00:32:47,160
We have a different category for casinos video game channels.

319
00:32:48,000 --> 00:32:56,240
Our methodology consisted of using our 2025 revenue data to find a number of emblems issue

320
00:32:56,240 --> 00:33:02,200
going to apply that new rate. The resulting percentage increase was then applied to the forecast

321
00:33:02,200 --> 00:33:10,100
to project the out years and we can see this roughly create 3 million in annual impact.

322
00:37:05,420 --> 00:37:09,640
If anyone on the call can verify that they can hear me, that would be great.

323
00:37:11,480 --> 00:37:17,200
A lot in clear. I have a thumbs up. And can you see my presentation? Yes.

324
00:37:22,300 --> 00:37:24,260
Yes. I got it. Yes. So, okay.

325
00:37:24,500 --> 00:37:28,680
It's not going to share to the screen, but we're sharing in the meeting. Is that acceptable? Are you recording?

326
00:37:31,400 --> 00:37:38,260
It's not recording, actually. Okay. And then I think we can just look at our printed out copies.

327
00:37:38,260 --> 00:37:49,280
and pivot there. So we're currently still on gambling machine tax. And then if anyone on the call,

328
00:37:49,520 --> 00:37:58,440
like it cuts out, please feel free to jump in and defy us. Gambling machine tax, I think David,

329
00:37:59,180 --> 00:38:07,630
finish and conclude at this slide if there's any commentary to let us know now. Otherwise, we'll

330
00:38:07,630 --> 00:38:15,630
on to the next line. I think that was just wondering what's the branding and this revenue source with the all the phone line.

331
00:38:16,810 --> 00:38:18,110
Oh, like.

332
00:38:18,330 --> 00:38:19,390
Oh, like.

333
00:38:21,710 --> 00:38:21,890
Sports.

334
00:38:22,350 --> 00:38:24,850
Yeah, I think the thing is that they have a funding revenue source.

335
00:38:26,030 --> 00:38:28,850
I need your best more so impacting the teachings.

336
00:38:29,730 --> 00:38:33,070
As it's more because we also have a sports way during tax.

337
00:38:33,070 --> 00:38:45,770
That has been more volatile, so it's been hard to parse out how those prediction-market apps.

338
00:38:45,890 --> 00:38:53,770
I guess I would say I've been impacting because it is, it supports major attacks still,

339
00:38:53,770 --> 00:39:11,750
Well, it's a new county, but for the VGT revenue is really driven by the amount of establishments and how many things they have, the most you could have is six terminals in your establishments.

340
00:39:11,750 --> 00:39:17,090
And so we'll look at the game, the game, the game boards,

341
00:39:17,390 --> 00:39:22,390
reports of how the sheets must see how that's been trying

342
00:39:22,390 --> 00:39:24,650
as far as I can, how the salvage means.

343
00:39:25,470 --> 00:39:28,190
Usually, all the establishments backs out.

344
00:39:28,210 --> 00:39:34,590
There's about 45 of them in account that you have these terminals.

345
00:39:35,290 --> 00:39:39,470
It has been inked over the

346
00:39:43,380 --> 00:39:45,560
last couple of years.

347
00:39:46,920 --> 00:39:53,020
So I think it's more so just the where's the ceiling with the number of establishments.

348
00:39:53,980 --> 00:39:57,220
So we've tried to forecast that frequency though.

349
00:40:11,390 --> 00:40:33,110
Okay, moving on to alcoholic beverage tax. So, the alcoholic beverage tax is currently structured as a hybrid tax with flat per gallon rate taxes on beer and liquor and rates dependent on alcohol by volume for wine and similar products as seen in the table just below.

350
00:40:33,110 --> 00:40:49,530
So the revenue growth proposal here would be to increase all rates by applying the cumulative inflation since the rates were last increased, which was in 2012, and that would be a 41% increase, which was then applied to the rates.

351
00:40:49,530 --> 00:40:59,330
In terms of methodology, we apply the new rates to the 2025 tax base, is that's the last year of complete data that we have for each tier.

352
00:41:00,050 --> 00:41:04,190
And then this calculated the revenues that would have been generated at these new rates.

353
00:41:05,070 --> 00:41:12,910
And then we calculated the additional revenues for these out years and the forecasts by applying this first-edged increase to our baseline forecast.

354
00:41:14,350 --> 00:41:28,630
So, for FY27, we would generate approximately 14.8 million while the out years were anticipating an additional 14.5 and this dip accounts for the dip in trends of alcohol consumption.

355
00:41:29,210 --> 00:41:35,190
And there's we're forecasting a trend in reduced alcohol consumption.

356
00:41:39,220 --> 00:41:46,640
And the increase is a per gallon, not all of them, so beer and liquor are per gallon

357
00:41:46,640 --> 00:41:59,080
rates, so it's a flow, but if you say 34 cents, what's the 30% for cents for what?

358
00:42:00,400 --> 00:42:05,680
Um, that we're out, uh, what's that thought is pretty that would be very good.

359
00:42:05,800 --> 00:42:06,880
Yeah, I'm just okay.

360
00:42:10,530 --> 00:42:11,170
Okay.

361
00:42:11,210 --> 00:42:14,450
The base on volume of what's in the liquor.

362
00:42:17,350 --> 00:42:17,830
These,

363
00:42:22,820 --> 00:42:31,900
they really, that's not just surprised and this is what you do now, too, but they really jacked up these things above 20%.

364
00:42:31,900 --> 00:42:36,560
So that's I guess that's that's really more of the better than talking about.

365
00:42:36,560 --> 00:42:39,720
Maybe it's one, though, though, that.

366
00:42:39,740 --> 00:42:39,900
Yeah.

367
00:42:40,300 --> 00:42:42,080
So, it's a lot higher.

368
00:42:43,320 --> 00:42:43,460
Yeah.

369
00:42:47,120 --> 00:42:49,820
So, we talked about changes in topical consumption.

370
00:42:50,440 --> 00:42:54,840
And I'm hearing that people were built in.

371
00:42:54,940 --> 00:42:55,320
Yes.

372
00:42:55,640 --> 00:42:59,400
And why can some change be a consumption for liquor or mixed drinks?

373
00:43:00,540 --> 00:43:02,200
Now, I want to substitute effects.

374
00:43:03,860 --> 00:43:09,280
I don't know if we're doing the marijuana consumption trade-off is incorporated.

375
00:43:10,020 --> 00:43:15,060
department of revenue can speak to that. I don't know if Tina wants to jump in.

376
00:43:15,220 --> 00:43:18,580
This is what could be. So this is showing a one-time reduction in revenue,

377
00:43:19,200 --> 00:43:23,880
going from 27 to 20 and then we're testing. Right, the rest of the period.

378
00:43:24,260 --> 00:43:29,280
Disapp. Yeah, I believe I believe seeing reasonable based on previous trends before

379
00:43:29,280 --> 00:43:33,540
taxing. I mean, isn't this just a source that is declining over time?

380
00:43:33,840 --> 00:43:38,620
Yeah, we have seen it. The planning and the last couple of years,

381
00:43:38,620 --> 00:43:45,780
I think against our June forecast, we had really forecasted them out as flat.

382
00:43:46,800 --> 00:43:51,680
I think that's why I just probably showing it.

383
00:43:51,680 --> 00:43:53,860
That's just the same year over here, I'm out.

384
00:43:55,840 --> 00:43:57,420
Tina, I noticed you unmuted.

385
00:43:57,780 --> 00:43:59,880
Did you want to add to that?

386
00:44:00,160 --> 00:44:03,080
I heard you say something about the, I didn't hear the question.

387
00:44:03,220 --> 00:44:06,980
I heard something about marijuana and some kind of department of revenue.

388
00:44:06,980 --> 00:44:10,020
and so I didn't know if you wanted me to speak.

389
00:44:11,220 --> 00:44:13,340
I don't know if I wanted to speak.

390
00:44:13,340 --> 00:44:15,100
Okay, thank you.

391
00:44:17,660 --> 00:44:19,340
Okay, we're going to do this.

392
00:44:19,520 --> 00:44:20,420
Thank you, Tom.

393
00:44:27,340 --> 00:44:28,980
We've been going to that before.

394
00:44:30,440 --> 00:44:31,140
Ted, let me know.

395
00:44:31,200 --> 00:44:32,260
Wipe eyes back up.

396
00:44:32,520 --> 00:44:33,580
So we're going to try it better.

397
00:44:35,280 --> 00:44:37,660
I know, sorry for all the privates.

398
00:44:38,480 --> 00:44:40,740
Thanks for everyone's flexibility.

399
00:44:43,060 --> 00:44:49,640
Tina, do you want to jump in now, maybe we can hear you?

400
00:44:50,340 --> 00:44:51,120
Can you hear me?

401
00:44:51,360 --> 00:44:52,080
Yes, we can.

402
00:44:54,080 --> 00:44:57,600
So I said I did not know if you wanted me.

403
00:44:57,780 --> 00:44:58,800
I heard.

404
00:44:59,660 --> 00:44:59,920
I couldn't hear that.

405
00:45:00,000 --> 00:45:11,140
Question, I heard marijuana and I heard Department of Revenue and I didn't really hear what the question was, so I don't know if you wanted me to weigh in anything.

406
00:45:12,740 --> 00:45:21,040
I think the relevant thing is why is the projection of revenue increase for alcohol, black, insumption is the climate.

407
00:45:25,840 --> 00:45:31,880
It has been declining overall in the last few years.

408
00:45:33,360 --> 00:45:43,840
I did not do these projections, but we did look at the individual categories in this.

409
00:45:44,520 --> 00:45:46,580
And beer continues to decline.

410
00:45:46,580 --> 00:45:59,200
each year. Hard liquor is actually it's spiked after COVID in 2021 and that has been kind

411
00:45:59,200 --> 00:46:11,860
of volatile since then and wine and which is like generally the category under 14% is wine

412
00:46:13,280 --> 00:46:17,220
and then 14 to 20% those have been pretty stable.

413
00:46:19,400 --> 00:46:24,480
So if bearware is the main component that

414
00:46:24,480 --> 00:46:33,480
continues to decline, I think that it should remain relatively stable. I mean, I'm not sure if

415
00:46:36,490 --> 00:46:44,850
it's

416
00:46:44,850 --> 00:46:57,650
And I'm not sure what the thought process behind the leaving it flat for the outlying years unless maybe someone assumed it was going to just level off at some point.

417
00:46:59,050 --> 00:47:10,850
Yeah, I think I think that was the thinking and past iterations of the forecast is that there would be some bottoming out of that that, you know,

418
00:47:10,850 --> 00:47:14,530
You're wouldn't just continue to decline perpetuity.

419
00:47:17,910 --> 00:47:20,190
So I think that was the main reason why.

420
00:47:20,590 --> 00:47:22,310
Hope that's true.

421
00:47:23,910 --> 00:47:27,830
Just ask the question, so you say why is trending stable,

422
00:47:28,270 --> 00:47:32,570
but you see some volatility in what was the other kind of clicker?

423
00:47:33,130 --> 00:47:34,630
Hard clicker above 20%.

424
00:47:35,210 --> 00:47:38,190
So I think everyone was doing shots after COVID.

425
00:47:38,190 --> 00:47:48,690
You know, a lot of shots and then it kind of went down, back up a little bit and so it's hard to say where that will go.

426
00:47:48,890 --> 00:47:49,430
Not category.

427
00:48:00,090 --> 00:48:05,110
I guess just to be clear, you have looked into the longer term forecast.

428
00:48:05,370 --> 00:48:11,050
But I'm particularly familiar with the line and that it's my understanding that the trend is downwards.

429
00:48:11,890 --> 00:48:17,810
But the expectation that that will continue because younger people aren't drinking as much as older people.

430
00:48:17,810 --> 00:48:24,790
I don't know what percent of the revenue source wine makes up all of these three categories.

431
00:48:25,790 --> 00:48:29,910
I don't, I'm not familiar with the trends in beer or our hard liquor.

432
00:48:30,930 --> 00:48:35,210
So I'm just wondering, can we make sure that we lift up the market?

433
00:48:35,690 --> 00:48:36,010
Yeah.

434
00:48:36,010 --> 00:48:36,090
Yeah.

435
00:48:36,150 --> 00:48:40,750
Ask for these things and make sure that this, this transient reasonable for the revenue forecast?

436
00:48:46,090 --> 00:48:51,370
see what the yellow breakdown is, as far as it's different categories.

437
00:49:01,840 --> 00:49:10,980
With our break question, I will move on to the next slide, which is our proposal for other

438
00:49:10,980 --> 00:49:17,420
tobacco products. So the revenue growth option that we explored for the other tobacco products

439
00:49:17,420 --> 00:49:25,040
tax is a two-part proposal, so first we are proposing an adjustment to expand the definition

440
00:49:25,040 --> 00:49:30,040
of products, subject to the other tobacco products tax, so that it would now include

441
00:49:30,040 --> 00:49:36,240
a proposal will make it seem. This would include new nicotine products and product lines,

442
00:49:36,400 --> 00:49:41,460
such as nicotine pouches that are not currently captured in the county's tax space,

443
00:49:42,880 --> 00:49:47,320
state of Illinois and other states have already expanded their definitions to include these products.

444
00:49:47,320 --> 00:49:54,160
The second part of this proposal would revise the definition of consumable products, subject

445
00:49:54,160 --> 00:49:58,960
to the other tobacco products tax, and this would clarify the ordinance language to include

446
00:49:58,960 --> 00:49:59,960
all vapor products.

447
00:50:00,000 --> 00:50:09,820
So, regardless of nicotine content. And to ensure that the county tax is capturing all the products on the market, regardless of nicotine content.

448
00:50:11,180 --> 00:50:25,740
As far as methodology for both of these, we were reliant on our Department of Revenue's preliminary estimates, estimates which they performed by sampling invoices to estimate the total number of these products,

449
00:50:25,740 --> 00:50:33,300
order from Quif County retail tobacco dealers for both types of products. Our proposal currently

450
00:50:33,300 --> 00:50:41,340
assumes a 5% per unit tax on the absorbable nicotine products and a 20% tax per milliliter

451
00:50:41,340 --> 00:50:48,680
on paper products regardless of nicotine content. Both of our estimates assume a conservative

452
00:50:48,680 --> 00:50:56,940
compliance rate of 25 percent, which would generate additional revenue of 1.1 million for each

453
00:50:56,940 --> 00:51:04,260
of these parts, the proposals, so total it would be approximately 2.2 million dollars worth

454
00:51:04,260 --> 00:51:05,800
of additional revenue per year.

455
00:51:16,570 --> 00:51:18,010
So I

456
00:51:21,280 --> 00:51:26,480
guess, where does the compliance rate 25 percent come from?

457
00:51:26,480 --> 00:51:28,900
That came from our department of revenue,

458
00:51:31,880 --> 00:51:42,940
I don't know if that's their history with, again, if Tina wants to jump in, they gave us 25% rate of compliance and 50% rate of compliance.

459
00:51:42,940 --> 00:51:46,480
and some really low-guides.

460
00:51:46,600 --> 00:51:54,240
Yeah, we understand, so I don't know, that's typically the trend with incorporating new taxes or new rates or expanding the base.

461
00:51:55,200 --> 00:51:58,060
So if I think you know, I'm muted, so if you want to jump in there.

462
00:52:03,720 --> 00:52:13,040
So it is our experience with this type of product, not taxes in general, but these vape and

463
00:52:13,040 --> 00:52:21,580
And nicotine products that they're selling at these convenience stores and and those types of stores that

464
00:52:22,740 --> 00:52:25,000
they tend to

465
00:52:26,060 --> 00:52:31,300
They tend to sell products that maybe they get from non

466
00:52:32,120 --> 00:52:42,180
Compliant wholesalers and so where it's a constant a

467
00:52:42,180 --> 00:52:52,440
and, you know, we issue a lot of citations to them, but so 25% is just a pretty, especially

468
00:52:52,440 --> 00:53:00,880
over, you know, in the first couple of years, it's a conservative estimate.

469
00:53:01,640 --> 00:53:06,000
And do you think are the compliance rates that low for the tech to back up products, too?

470
00:53:06,740 --> 00:53:12,820
No, to back up products, well, I mean, we do issue, we do find a lot of illegal cigarettes out there,

471
00:53:12,820 --> 00:53:23,340
But it's definitely not as these these products are harder to to police, um, you know,

472
00:53:23,380 --> 00:53:29,380
they get a lot, it's, we work with the state of Illinois and the state of Chicago and,

473
00:53:29,420 --> 00:53:39,040
you know, we go to, like, these conferences and there's just a lot of contraband or I guess

474
00:53:39,040 --> 00:53:47,780
could would say that, you know, they get from other countries and, yeah, it's, you know,

475
00:53:48,060 --> 00:53:58,120
and with cigarettes, it seems like there's not as much non-compliance with cigarettes.

476
00:53:58,120 --> 00:54:05,620
these, these, these seem, you know, big with cigarettes. There's, there's a, you know, a lot of that cigarettes stuff.

477
00:54:05,700 --> 00:54:13,680
The cigarettes, it's a very, it's not so easy to sell cigarettes in a legal, without tax

478
00:54:13,680 --> 00:54:19,180
snapshot. It's, it's, it's pretty easy to catch people. There's a lot of regulation to catch people.

479
00:54:19,800 --> 00:54:25,000
But I guess I'm wondering about the paper for anyway, it's, I don't want to go too deeply in this because

480
00:54:25,000 --> 00:54:41,080
It's not that much money, but I mean, it seems to me, I just, I'll just say, it seems terrible policy to be taxing non tobacco products, the same as tobacco products, except if we don't really know which is which, maybe it's not a terrible policy.

481
00:54:43,080 --> 00:54:47,180
I mean, you know, we're taxing tobacco for a reason.

482
00:54:47,580 --> 00:54:53,080
So we don't want to tax evade products that don't have nicotine, but on the other hand if there's

483
00:54:53,080 --> 00:54:57,980
a lot of non-compliance, maybe once it's say they don't have nicotine, do have nicotine.

484
00:54:59,080 --> 00:54:59,460
So...

485
00:54:59,460 --> 00:54:59,920
I don't...

486
00:55:00,000 --> 00:55:11,560
I don't think Frank's on the call, but Frank in the Department of Revenue explains to me too that there's kind of like a threshold before you have to list on the product that it does have nicotine.

487
00:55:12,360 --> 00:55:26,140
So there might be some products that do have nicotine in them, but because they don't surpass the certain thresholds, they can get away with not having to.

488
00:55:26,140 --> 00:55:29,900
That's it. I think they're four get captured in this tax.

489
00:55:42,970 --> 00:55:46,340
Oh, Tina, did you have anything to add?

490
00:55:48,350 --> 00:55:49,950
No, I don't think so.

491
00:55:50,330 --> 00:55:51,610
Okay, thank you so much.

492
00:55:52,310 --> 00:55:56,530
I'm going to meet myself for moving on to the next slide.

493
00:55:58,830 --> 00:55:59,650
Then our box.

494
00:55:59,810 --> 00:56:01,150
Yeah, so this is just an update.

495
00:56:01,150 --> 00:56:03,570
for back and phone, it's more of a turning established

496
00:56:03,570 --> 00:56:05,470
the ARPA sustainability reserve.

497
00:56:05,610 --> 00:56:07,990
And the idea of that was to carve a stair

498
00:56:07,990 --> 00:56:11,710
stuff into our fiscal cliff, associated with the kind

499
00:56:11,710 --> 00:56:15,390
of the American Rescue Act Rescue Man program.

500
00:56:16,550 --> 00:56:20,850
We knew that the county would not be able to continue to provide funding

501
00:56:20,850 --> 00:56:22,670
for all of the ARPA programs.

502
00:56:22,870 --> 00:56:24,890
We had about 72 different programs.

503
00:56:26,790 --> 00:56:29,070
And so the reserve was created for the state

504
00:56:29,070 --> 00:56:35,730
purpose of reducing the amount allocated from it each year between 2027 and 2029.

505
00:56:37,030 --> 00:56:42,530
In order to establish which programs just be with sustained and engaged in many of the

506
00:56:42,530 --> 00:56:50,150
surveys and hyperlocal conversations and as a result of those conversations and with coordination

507
00:56:50,150 --> 00:56:55,090
within the office of the president about which programs we could we could sustain and

508
00:56:55,090 --> 00:57:21,230
opportunity, we were able to identify these 12 programs that you see on the right, and we will be sustaining those programs with funding as identified in that table and FY2027 will be the first year that we use the American Rescue Plan Act reserve to sustain some of our programs and we'll be allocating a 52.7.5.6 million dollars.

509
00:57:22,270 --> 00:57:23,710
Next slide.

510
00:57:24,910 --> 00:57:30,130
In 2028, we will need to start addressing the expected gaps between these estimated costs

511
00:57:30,130 --> 00:57:31,490
and the article deserves.

512
00:57:32,070 --> 00:57:35,150
At this point, we have a total projected gap that we have about $1.

513
00:57:37,230 --> 00:57:42,690
Between 2028 and 2030, and we'll be working closely with the departments to develop

514
00:57:42,690 --> 00:57:48,730
gap reduction strategies that include seeking to identify external funds from the

515
00:57:48,730 --> 00:57:51,770
landscape and other external solutions where we can

516
00:57:51,770 --> 00:57:54,610
generating revenues from the programs themselves,

517
00:57:55,390 --> 00:57:59,990
possible and leveraging county funds or scaling down initiatives

518
00:57:59,990 --> 00:58:04,650
when necessary, all with the goal of savings programs

519
00:58:05,150 --> 00:58:06,250
into the future.

520
00:58:06,710 --> 00:58:08,130
We believe we can do

521
00:58:12,230 --> 00:58:13,250
that side.

522
00:58:16,190 --> 00:58:17,890
That's for 2030.

523
00:58:19,050 --> 00:58:22,490
The identified gap is 23.3.

524
00:58:22,490 --> 00:58:28,580
But the total is 20 on the previous slide.

525
00:58:34,620 --> 00:58:35,900
That's right.

526
00:58:35,900 --> 00:58:37,840
We have $20 million in funding.

527
00:58:38,060 --> 00:58:40,900
That's $23.3 million in debt.

528
00:58:42,710 --> 00:58:45,510
About 50, 20, 30, 40, 3 million in debt.

529
00:58:53,540 --> 00:58:54,380
That's the bill.

530
00:58:54,980 --> 00:58:56,540
We were just going to spend the debt.

531
00:58:56,760 --> 00:58:58,920
I thought that was going to be $20

532
00:59:01,540 --> 00:59:02,900
million in debt.

533
00:59:03,180 --> 00:59:05,960
A little bit of debt to sell in the different allocations of the resources.

534
00:59:06,220 --> 00:59:09,200
If you wanted to kind of get a sense of what the cost would be.

535
00:59:09,200 --> 00:59:15,420
look at that 2027 table, and that's pretty consistent across those

536
00:59:15,420 --> 00:59:18,120
user's use of production, do some of the program.

537
00:59:18,780 --> 00:59:22,600
I thought, we out here, so we see some interfaces of the projected process.

538
00:59:23,140 --> 00:59:24,920
But those are going to change over time.

539
00:59:27,230 --> 00:59:28,650
Let's see get closer to that.

540
00:59:28,850 --> 00:59:29,790
We're going to find that.

541
00:59:31,910 --> 00:59:32,490
How does higher?

542
00:59:32,490 --> 00:59:33,530
Not as low as in.

543
00:59:42,160 --> 00:59:45,200
So I think now at this point, right, we've been incorporated

544
00:59:46,520 --> 00:59:52,020
those additional expenses into our long-term financial forecast.

545
00:59:52,480 --> 00:59:57,100
When you look at the tail end of our alligator sliders, we're at the Pollock.

546
00:59:57,380 --> 00:59:59,960
Let's see that, you know, it's hard out to pay for.

547
01:00:00,000 --> 01:00:00,680
It's loud.

548
01:00:14,500 --> 01:00:21,460
So, those are just some of the orderly updates. Next, we're going to take a look at our sales

549
01:00:21,460 --> 01:00:32,600
packs. So, I can only do run through just how our projections of sales tax has changed over

550
01:00:32,600 --> 01:00:40,220
the last year and a half. How we think legislative changes, what we're seeing have impacted,

551
01:00:40,220 --> 01:00:48,800
especially in 2025 and 2026 and whether or not we can expect to see the

552
01:00:48,800 --> 01:00:54,120
recent high-year growth in the county sales facts if that will continue in

553
01:00:54,120 --> 01:01:01,720
two-proutured years. So on the next slide here, this is just some of the

554
01:01:01,720 --> 01:01:09,380
phasor legislation that was enacted which has impacted a lot of counties collection.

555
01:01:09,380 --> 01:01:16,320
a lot of local governments collections in the state. I'll really focus on second and third pieces

556
01:01:16,320 --> 01:01:25,140
here. Public Act 101, 31, which is the leveling of the playing field act. So this altered this

557
01:01:25,140 --> 01:01:35,060
the utility occupation tax to be from a origin-based sales tax to like destination-based sales

558
01:01:36,060 --> 01:01:41,200
So there are many, many of most businesses out of state

559
01:01:41,200 --> 01:01:44,040
for paying some kind of revenue to the state of Illinois,

560
01:01:44,900 --> 01:01:48,260
but legislation that went into effect here

561
01:01:48,660 --> 01:01:51,980
had changed the way that the sales were taxed.

562
01:01:52,660 --> 01:01:57,080
So a lot of these businesses were just remaining use tax

563
01:01:57,080 --> 01:01:59,840
and so they wouldn't have to pay local to choose taxes.

564
01:01:59,840 --> 01:02:06,340
So, the leveling, the plain field attack, change that, so that out of state sellers would

565
01:02:06,340 --> 01:02:09,720
then re-remit the locally owned state taxes.

566
01:02:11,320 --> 01:02:22,420
And then in enacted in 2025 January, there was a change where we saw an inclusion of out-of-state

567
01:02:22,420 --> 01:02:28,520
sellers that have some kind of physical presence in Illinois, for example, a company that has

568
01:02:28,520 --> 01:02:34,420
rep or sales office in Illinois, but shipping products and customers from a warehouse that was

569
01:02:34,420 --> 01:02:40,160
outside of the state, they used to just pay like the use tax rate for the state of six

570
01:02:40,160 --> 01:02:48,000
on a quarter by passing the local rates, they would now be captured and also pay locally in

571
01:02:48,000 --> 01:02:56,180
most sales taxes. So these are two major drivers over the last five years that have impacted favorably

572
01:02:56,180 --> 01:02:58,360
counties, sales tax collections.

573
01:03:01,420 --> 01:03:06,440
And so on the next slide here, we wanted to take a look at

574
01:03:07,720 --> 01:03:15,060
counties, sales tax, or portion of the county sales tax versus the state's gross sales tax

575
01:03:15,060 --> 01:03:23,760
that goes into their general fund. So there's what's referred to as PL or permanent location.

576
01:03:24,860 --> 01:03:29,900
There's a part of the county sales tax that gets categorized as this, and this is for the

577
01:03:29,900 --> 01:03:37,400
state's website, from retail sales, from a permanent location, within the tax injury

578
01:03:37,400 --> 01:03:38,260
jurisdictions.

579
01:03:38,840 --> 01:03:43,720
So if you think of it as a more like brick and mortar stores, and if you look at the chart

580
01:03:44,360 --> 01:03:52,480
here, the volume of revenue is obviously quite different, but we wanted to show just an

581
01:03:52,480 --> 01:04:06,240
I have how we think the state's growth set of sales tax in our PL tax revenue has been relatively close and trending over the past five years.

582
01:04:06,580 --> 01:04:15,820
But then on the next slide, we have here including the CL tax payers, which is the changing location.

583
01:04:15,820 --> 01:04:22,480
from payers who have no permanent place of business within the taxing jurisdiction, but they

584
01:04:22,480 --> 01:04:25,920
do conduct intermittent retail sales within the jurisdiction.

585
01:04:27,220 --> 01:04:36,300
So you can see from 2021 here, this revenue has been trending higher over time.

586
01:04:36,840 --> 01:04:45,780
This is what we think is from what we understand is the impact of revenue from the recently

587
01:04:45,780 --> 01:04:55,280
active legislation, and so in 2025 you can see it really jumps up and as continued to 2026.

588
01:05:01,390 --> 01:05:07,490
This slide here, we're looking at the seat-out chairs.

589
01:05:09,730 --> 01:05:26,450
So the data that we get from the state, we've been seeing pretty steep increases in these CL taxpayers, especially in January of 2025, when public acts, 1931, to effects.

590
01:05:27,470 --> 01:05:35,430
So you can see from a nominal standpoint chart on the left, quite a jump, a little scuffling,

591
01:05:36,170 --> 01:05:41,550
the average monthly revenue, and we're also seeing increases in 2026.

592
01:05:43,470 --> 01:05:50,130
And then on the chart on the right here, this is the CL's as a proportion of the total

593
01:05:50,130 --> 01:06:01,010
county of South South Facts. So, you know, prior to 2025, this CL revenue made up about 15-20% of the

594
01:06:01,010 --> 01:06:10,990
county sales tax. We've seen that really jump up in 2025 and continuing to increase in this latest

595
01:06:10,990 --> 01:06:15,930
fiscal year, or is now in the range of 30-35%.

596
01:06:19,640 --> 01:06:22,400
Okay, that's a question. So I guess we should

597
01:06:23,840 --> 01:06:26,980
But so there's, we've sort of, it's delayed response to the legislation.

598
01:06:28,640 --> 01:06:33,540
I guess the thinking in is that there was just so much of this had these sort of

599
01:06:33,540 --> 01:06:37,720
in-state presence that it wasn't didn't really bite because it's all those maps.

600
01:06:37,900 --> 01:06:39,780
Is that kind of how we should think about this?

601
01:06:40,820 --> 01:06:44,900
Well, I think, you could think of it as, like, the second legislation of 2025.

602
01:06:46,520 --> 01:06:49,780
It's like a fan of a piece of surfing.

603
01:06:50,060 --> 01:06:51,580
It was both UCDL stacks.

604
01:06:52,780 --> 01:06:55,200
There was all these piers who were paying,

605
01:06:55,200 --> 01:06:57,080
they were paying like state tax,

606
01:06:57,420 --> 01:07:00,180
but they were paying because of like the definition.

607
01:07:02,020 --> 01:07:03,920
That's these all of these locally in those stacks.

608
01:07:04,180 --> 01:07:04,600
That's it.

609
01:07:04,600 --> 01:07:05,280
I think we're there.

610
01:07:05,540 --> 01:07:09,400
They're going to now really capture my account in the last two years.

611
01:07:12,200 --> 01:07:14,060
The legislation was for it.

612
01:07:14,060 --> 01:07:15,180
in the middle of it.

613
01:07:15,720 --> 01:07:17,580
But could they ever capture it?

614
01:07:17,580 --> 01:07:19,360
What was the motivation of it?

615
01:07:19,640 --> 01:07:21,040
First, 2026.

616
01:07:21,460 --> 01:07:24,060
And I was through a food service management,

617
01:07:24,100 --> 01:07:25,840
through this, you know, that's right.

618
01:07:26,840 --> 01:07:30,380
So I think the initial estimates that we had for the service

619
01:07:30,380 --> 01:07:31,860
management was pretty minimal.

620
01:07:32,160 --> 01:07:36,000
I think it was about the million dollars annual.

621
01:07:38,320 --> 01:07:41,300
You know, I think that's we got a couple more months of data.

622
01:07:41,300 --> 01:07:48,680
we could try to see if that is true or if there's, I think it's still like compliance from the previous

623
01:07:49,480 --> 01:07:56,640
year. So we'll have to keep, you know, only polar reports were able to kind of get a little more

624
01:07:56,640 --> 01:08:02,880
see if there's new businesses that come on and imagine these, and these downloads in the state.

625
01:08:06,760 --> 01:08:14,380
So is this suggesting to me that the impact of the 2021 legislation was much smaller than

626
01:08:14,380 --> 01:08:20,740
2025. Yes. Have you talked to the owner department of revenue about that? So I'm worried that

627
01:08:20,740 --> 01:08:30,180
there may be a changing definition of CL and PL because I know for sure 100% the 25 legislation

628
01:08:30,180 --> 01:08:37,720
was to fix unanticipated consequences of the major legislation which was passed in 2021.

629
01:08:39,320 --> 01:08:44,040
So I'm not familiar with these codes and what's fallen into them over time.

630
01:08:44,380 --> 01:08:52,440
the sale, the big, it's my understanding that the real big change came in 2021 and everything

631
01:08:52,440 --> 01:08:59,060
since then has been clicking on unanticipated consequences in the 2021 legislation.

632
01:08:59,320 --> 01:09:05,000
I see a fact. Yeah, we can reach out to the state to see you again.

633
01:09:10,330 --> 01:09:15,270
So then if that's the case, what explains the jump and revenue,

634
01:09:20,870 --> 01:09:34,650
I think we need to know more about the definite, because I'm thinking, this is good, but the definition is changed so much that orange is incomplete.

635
01:09:34,650 --> 01:09:35,190
Right.

636
01:09:38,150 --> 01:09:44,110
No, all right. So I think I think I think orange was much bigger than it is using this definition of CL.

637
01:09:44,990 --> 01:09:50,670
I think the definition of CL has changed over time. Our highest being used on that form.

638
01:09:50,670 --> 01:09:52,010
Yeah, I understand that.

639
01:09:52,170 --> 01:09:55,770
But I don't know enough to, I mean, I just think it's cool.

640
01:09:56,450 --> 01:09:56,810
Yeah, sure.

641
01:09:57,270 --> 01:09:57,610
Yeah.

642
01:09:57,610 --> 01:09:59,850
If you need to visit soon.

643
01:10:00,000 --> 01:10:13,240
For instance, it's like, like, PLs are now being, I've not familiar with the PL and see up what I do know is that 2021 try to change a situation as follows.

644
01:10:13,880 --> 01:10:18,920
Amazon had a warehouse in Indiana and it was being shipped to Chicago.

645
01:10:20,860 --> 01:10:28,140
And because it was I did, the tax rate was lower than if it was in Juliet, and it was shipped to Chicago.

646
01:10:28,140 --> 01:10:38,600
So, some, I'd be 4, 2021, the Julia distribution center was picking up a higher tax

647
01:10:38,600 --> 01:10:45,260
rate than the, based on product, I mean that's how I'm as on how they're stuff and more

648
01:10:45,260 --> 01:10:53,260
prices and stuff was really, really complicated, but I don't want us to say anyone

649
01:10:53,260 --> 01:11:03,060
And it's because I, but I'm just, it's always been my understanding that the 2021 legislation

650
01:11:03,060 --> 01:11:08,380
was the big change and all this other stuff is at the margin, yeah.

651
01:11:08,680 --> 01:11:13,880
I mean, I could be wrong, but that's, that's what I've always worked for.

652
01:11:14,180 --> 01:11:20,220
Yeah, I think that's sort of asking for it seems like there was a gaming that went on because of this sort of rule.

653
01:11:20,220 --> 01:11:24,620
if you had some insane presence or something, right, that would be, and if it was three

654
01:11:24,620 --> 01:11:28,700
retailers with the Amazon's of the world, we weren't supposed to be like buying their online stuff,

655
01:11:28,980 --> 01:11:32,460
right there couldn't help that. And so I'll explain the legislation then.

656
01:11:34,420 --> 01:11:39,740
I think really, I don't know if I really sure, like I think it says there's changing location and

657
01:11:39,740 --> 01:11:50,200
temporary location. I don't know how accurately they may take those codes, but we've kind of

658
01:11:50,200 --> 01:11:51,720
are being captured.

659
01:11:54,620 --> 01:11:59,220
So I think, right? Like, yeah, I don't know why. Why don't they just

660
01:11:59,220 --> 01:12:05,260
call it online? Because of Andrew doesn't submit their tax return and say, I got this

661
01:12:05,260 --> 01:12:09,800
amount of sales from an online scammer, and I got this amount of sales from somebody who

662
01:12:09,800 --> 01:12:15,260
looked in the door. I mean, there was tons of online sales that were being captured before 2021.

663
01:12:15,260 --> 01:12:22,560
I mean, the 2021 was to pick up and be in captured and what was being captured at the state

664
01:12:22,560 --> 01:12:25,440
read, but not the work for it.

665
01:12:27,500 --> 01:12:31,340
So it's a lot more complicated and think of the intent.

666
01:12:32,040 --> 01:12:33,180
It's a tax return.

667
01:12:34,500 --> 01:12:38,620
You know, it's not like you're serving martial fails and like, you know, where did your

668
01:12:38,620 --> 01:12:41,880
tests come from and what's shot at the diamond and did you mail it to them?

669
01:12:41,880 --> 01:12:49,120
You know, and well, we of historically no one had gone when sales were being captured before

670
01:12:49,120 --> 01:12:55,280
2020, most of them. Again, this is all just small, the tail is compared to what was

671
01:12:55,280 --> 01:13:00,080
already being proactive, exactly what was happening. I think we've got this surge in wrapping

672
01:13:00,080 --> 01:13:06,200
there. Yeah. So, it's got to be something that explains that right. So, some of these came

673
01:13:06,200 --> 01:13:10,200
Yeah, because of the tax, the tax not even applied to them.

674
01:13:12,240 --> 01:13:12,680
We'll start.

675
01:13:13,160 --> 01:13:14,140
And then you go back.

676
01:13:14,560 --> 01:13:18,480
So it would have been 20, 20 compared, 20, 20 compared to 2021.

677
01:13:18,620 --> 01:13:20,100
And we talked about this on the phone.

678
01:13:20,360 --> 01:13:22,540
Then 20, 20 was so messed up because of COVID.

679
01:13:23,360 --> 01:13:30,300
So we don't know what, how big of that jump was before.

680
01:13:30,480 --> 01:13:30,860
Yeah.

681
01:13:31,000 --> 01:13:31,580
20, 21.

682
01:13:32,620 --> 01:13:34,520
And the Dow is not playing the really good back.

683
01:13:34,520 --> 01:13:35,100
And

684
01:13:37,280 --> 01:13:42,800
I mean, every time you do a difficult business analysis, it improves, and the more

685
01:13:42,800 --> 01:13:47,260
data you get, the more data, you know, the more a prison and more than you understand.

686
01:13:47,660 --> 01:13:49,580
And I just, I think we're still in it.

687
01:13:49,580 --> 01:13:54,800
Very right to tell us, even though this seems like a nice clean story, but it probably isn't.

688
01:13:55,040 --> 01:13:56,580
It's probably more complicated than this.

689
01:13:56,580 --> 01:14:00,960
But to me, the scene I thought, okay, well, the sixth place isn't that makes all make sense.

690
01:14:01,840 --> 01:14:03,400
Yeah, but maybe it's more complicated.

691
01:14:06,640 --> 01:14:08,520
This is a nice explanation, right?

692
01:14:08,540 --> 01:14:13,120
I mean, you're showing the things we're stable at following the general pattern with the

693
01:14:13,120 --> 01:14:13,860
PLs, right?

694
01:14:13,980 --> 01:14:15,420
The growth of the things in the PLs.

695
01:14:16,120 --> 01:14:21,140
And one question I have is, you know, are we done with the growth in the CLs that kind of

696
01:14:21,140 --> 01:14:22,480
jump in a head of slide year?

697
01:14:23,400 --> 01:14:23,680
Yeah.

698
01:14:24,160 --> 01:14:25,400
But it looks like it.

699
01:14:25,400 --> 01:14:36,020
We may be hitting my toe, but that's, it does seem that that's where it grows coming from,

700
01:14:36,100 --> 01:14:42,320
as well as occupant, some cool figures in. Yeah, yeah. So if you guys, you know, this slide here

701
01:14:42,320 --> 01:14:49,720
really shows as far as like the annual change and the monthly revenues for the, you can see the

702
01:14:49,720 --> 01:14:59,700
CL's is compared to the our location and also how that looks on the state level 2 in RPL in the states.

703
01:15:00,530 --> 01:15:09,370
You know, tracking pretty close, but yes, just closing in 2025, that legislation.

704
01:15:11,790 --> 01:15:19,470
And then, you know, we think it's moderating now. And this is like what we, you know, once,

705
01:15:19,950 --> 01:15:26,090
as far as like getting our forecast rate and like our dummy variable, which we have for our model,

706
01:15:26,850 --> 01:15:34,210
not assuming that there's going to be a continuation of growth in the legislation, making sure

707
01:15:34,210 --> 01:15:40,530
that that does reflect it in the model, and it's going to be a we're not expecting in this

708
01:15:40,530 --> 01:15:43,610
low-row in perpetuity and cheer.

709
01:15:51,060 --> 01:15:56,580
One way, by the way, people back in the slide, to maybe try to think about whether there's any room

710
01:15:56,580 --> 01:16:00,360
to run is that you're getting 35% in the last few months

711
01:16:00,360 --> 01:16:05,620
about somewhere in the 30, 35% of your revenue from these CL.

712
01:16:06,520 --> 01:16:08,360
So trying to compare that with what's

713
01:16:08,360 --> 01:16:11,720
share of retail sales around line versus in-person.

714
01:16:11,980 --> 01:16:13,860
That should be a statistic that's out there

715
01:16:13,860 --> 01:16:15,260
and the two should line out.

716
01:16:15,560 --> 01:16:18,000
So if it is about 35% of sales,

717
01:16:20,520 --> 01:16:22,120
then you've sort of run

718
01:16:22,120 --> 01:16:22,980
your course here.

719
01:16:23,080 --> 01:16:25,520
But if it's 40, maybe there's a little bit more,

720
01:16:25,520 --> 01:16:31,460
there's some people that are still out there, not that kind of thing.

721
01:16:31,660 --> 01:16:39,940
So did you go back and see if somebody was at the PL at one point and became a peer?

722
01:16:43,960 --> 01:16:48,620
I could say just I've caught where there's been one month.

723
01:16:48,880 --> 01:16:55,340
For there's been months of the business being categorized to PL and then they change.

724
01:16:55,340 --> 01:17:09,400
So the next one to be a CL, but then it seems like it's switched back and it was kind of like a one off like maybe an error the way that was entered that doesn't seem to happen too often now it's more so

725
01:17:09,400 --> 01:17:15,860
Observing more CLs coming on line with each dispersion.

726
01:17:18,890 --> 01:17:24,690
But not so much, you know, switching between the two category categories.

727
01:17:25,350 --> 01:17:32,210
There are like businesses too, where they'll have PL lines, but then they'll have

728
01:17:32,210 --> 01:17:38,710
CL line too, come on at some point and it seems like, you know, there's just like

729
01:17:38,710 --> 01:17:44,190
other part of, like I said, the way that they're submitting a class by, so there'll be two

730
01:17:44,190 --> 01:17:49,350
requests for the business of the CLNTL, that we've seen as well,

731
01:17:51,380 --> 01:17:53,160
but not so much of like operating

732
01:17:53,160 --> 01:17:59,740
on the big categorized one and then switching to the other, it's the out, it's the out ones.

733
01:18:00,740 --> 01:18:03,820
So what do you get from the state?

734
01:18:04,460 --> 01:18:08,620
So lecture, when these businesses were just kind of new scents,

735
01:18:10,220 --> 01:18:12,260
were you getting any information from them?

736
01:18:13,640 --> 01:18:16,620
Well, I think we've only been getting this data

737
01:18:16,620 --> 01:18:22,160
with like the last, I think maybe two and a half or years.

738
01:18:23,520 --> 01:18:26,100
So before that, we weren't really getting any,

739
01:18:26,100 --> 01:18:27,880
because if that's, that's meeting.

740
01:18:29,870 --> 01:18:33,290
Would you have, even in the last year, or 2025,

741
01:18:33,290 --> 01:18:43,420
would on the file you get from the step, you would just be getting businesses that have that could continue.

742
01:18:44,370 --> 01:18:44,710
Thank you.

743
01:18:44,770 --> 01:18:46,750
We tell this little detail on the issue.

744
01:18:46,950 --> 01:18:51,250
So if they were paying the use tax they would now they wouldn't show up on a file for you.

745
01:18:51,730 --> 01:18:56,190
Even though you were getting a distribution from the waste tax to small as it may be.

746
01:18:56,230 --> 01:18:58,230
Like from the government's government.

747
01:18:58,870 --> 01:19:00,230
There'd be a phone portion.

748
01:19:01,370 --> 01:19:09,150
But you don't have any transparency on whether they were new businesses or they were paying

749
01:19:09,150 --> 01:19:11,470
news tax all of a sudden they just come on.

750
01:19:12,410 --> 01:19:12,470
Correct.

751
01:19:12,610 --> 01:19:13,170
I will.

752
01:19:13,210 --> 01:19:21,410
We've made assumptions over the last couple because the way that we when we talk to the

753
01:19:21,410 --> 01:19:27,230
state we ask like how could we tell what are the new word of the new revenues from the legislation

754
01:19:27,910 --> 01:19:29,650
and we were informed that.

755
01:19:29,650 --> 01:19:35,950
you should track the CLs. And like the, essentially, if the new businesses that come online in a month

756
01:19:35,950 --> 01:19:44,710
is probably related to the most recently enacted legislation. So if you would track to

757
01:19:44,710 --> 01:19:51,570
see each month when you pull, if there's like a new business and account code, and if it's under CL,

758
01:19:51,570 --> 01:19:58,430
So, then we could kind of tag that as in the next slide.

759
01:19:58,430 --> 01:19:59,950
is it possible to work?

760
01:20:00,000 --> 01:20:10,000
A question was asked and files answered that the CL, some of them were panic use tags, but they're

761
01:20:10,000 --> 01:20:18,240
new to you. So, to you'll be in total below the CLs. Yeah. But that doesn't mean that they went

762
01:20:18,240 --> 01:20:22,450
And yeah,

763
01:20:24,650 --> 01:20:35,290
because I'm a bit troubled by this impact of 2020, five because it shouldn't be that large in part to 2021.

764
01:20:36,390 --> 01:20:37,970
But if there's,

765
01:20:40,690 --> 01:20:44,550
if a whole bunch of new companies are showing up in your file,

766
01:20:45,590 --> 01:20:51,330
because they're paying county tax, not because they're all the sudden paying tax,

767
01:20:51,330 --> 01:20:55,370
that they were always paying the use tax. They just now fall into your bucket.

768
01:20:57,370 --> 01:21:04,350
So I guess part of that conversation is that the language matters, like online taxes,

769
01:21:04,570 --> 01:21:09,110
when we use the term online sales, the taxes will be impaired. They just won't be

770
01:21:09,110 --> 01:21:16,630
impaired at the higher rate for the county to get. I think that, I mean, that distinction

771
01:21:16,630 --> 01:21:23,350
is really important. Yeah, because that's the game going back to that

772
01:21:23,350 --> 01:21:29,710
intent of the legislation was to buy the local taxes. Whatever it was and could

773
01:21:29,710 --> 01:21:35,050
whatever it was in Chicago to be allowed to be collected on sales because up until

774
01:21:35,050 --> 01:21:40,210
that point there was no legal authority to collect anything one at six and an order.

775
01:21:41,690 --> 01:21:43,910
Yeah, I think we should get back out.

776
01:21:43,910 --> 01:21:45,410
So I was going to hand the credit.

777
01:21:46,230 --> 01:21:46,630
Yes.

778
01:21:46,910 --> 01:21:47,350
Thank you.

779
01:21:47,350 --> 01:21:47,610
Thank you.

780
01:21:48,930 --> 01:21:51,210
I think it would be helpful for me to.

781
01:21:51,250 --> 01:21:54,370
I'm assuming an example of what you consider a C.L.

782
01:21:54,390 --> 01:21:57,410
Is that more the pop-up phenomenon that we're seeing?

783
01:21:57,650 --> 01:21:57,990
There's companies.

784
01:21:58,690 --> 01:22:00,050
Organizations are coming in.

785
01:22:00,130 --> 01:22:01,450
Just standing up temporary.

786
01:22:02,570 --> 01:22:05,110
Pop-up locations and they're up to the next state.

787
01:22:05,290 --> 01:22:08,790
This is more of like like the facilitator.

788
01:22:09,190 --> 01:22:09,670
Okay.

789
01:22:10,410 --> 01:22:16,430
So, like, if you go online platform, yeah, like you're having a sense.

790
01:22:16,890 --> 01:22:16,910
Yeah.

791
01:22:19,510 --> 01:22:21,330
So it's strange to call them.

792
01:22:21,490 --> 01:22:21,810
See, yeah.

793
01:22:21,850 --> 01:22:22,090
That's right.

794
01:22:22,230 --> 01:22:25,370
Because that's not going to be what's going on.

795
01:22:26,430 --> 01:22:28,390
It's not something changing their location.

796
01:22:28,590 --> 01:22:34,130
This way is the question, because I'm thinking it's more, there's a growth in the pop-up type venues.

797
01:22:34,570 --> 01:22:36,250
Happening specifically in Chicago.

798
01:22:36,430 --> 01:22:37,690
I'm thinking, is that a driver?

799
01:22:37,690 --> 01:22:39,910
But you're saying that's not the audience.

800
01:22:41,070 --> 01:22:41,570
Okay.

801
01:22:41,570 --> 01:22:44,170
I think like what we're trying to highlight here

802
01:22:44,170 --> 01:22:47,270
is that's the detail that we get the state of part

803
01:22:47,270 --> 01:22:52,410
is an exactly conducive for performing in depth analysis

804
01:22:52,410 --> 01:22:57,370
on how much of our, on all of our sales tax

805
01:22:57,370 --> 01:23:00,650
is related to online sales.

806
01:23:00,950 --> 01:23:05,410
What we have available to us are in the most group.

807
01:23:06,030 --> 01:23:11,690
Like, find this level of detail that is provided to us are three types of categorizations.

808
01:23:12,210 --> 01:23:16,530
EL, CL and TL, and none of them are very well defined.

809
01:23:17,270 --> 01:23:23,410
So we're using the best data that we can in order to identify the information and estimate

810
01:23:23,410 --> 01:23:26,970
what the components of the legislation are doing here.

811
01:23:27,290 --> 01:23:31,470
And I think they've done a really good job of putting that information together, and so

812
01:23:31,470 --> 01:23:38,650
a pretty compelling story about, you know, how the legislation has impacted those categories.

813
01:23:39,210 --> 01:23:43,670
Now whether or not those categories are accurate, whether those categories are a good

814
01:23:43,670 --> 01:23:49,090
representation of what online sales are, I don't think we could do this to that question.

815
01:23:49,430 --> 01:23:55,490
But we can say that, you know, ostensibly, right, that the legislation has had a pretty significant

816
01:23:55,490 --> 01:24:02,550
impact on the sea all tax boyers we have largely attributed to public intelligence.

817
01:24:03,650 --> 01:24:09,690
Yes, so the sales are a subset of online, and I think it's probably for us,

818
01:24:09,790 --> 01:24:19,270
as you should talk to, or I can't talk to some orders that work. And I think there's very little

819
01:24:20,370 --> 01:24:27,210
opposed legislation, I'd throw to close any more gaps, loop holes, whatever. So I think

820
01:24:27,210 --> 01:24:32,290
this last push is going to, like I think there was one thing that didn't have something

821
01:24:32,290 --> 01:24:45,050
marginal. But so I think now I still think it could kind of be indolivered, our taxab could kind

822
01:24:45,050 --> 01:24:53,200
I think you'd be hard plastic by something that's not which goes back to like the analysis of the sales tax that you were like avoidance.

823
01:24:54,010 --> 01:24:56,690
I'm not sure that you

824
01:24:56,690 --> 01:24:58,470
There's a way to avoid pain

825
01:25:00,000 --> 01:25:09,480
That sales tax anymore, because men and people's good. Yeah, you just don't have enough money to buy, you know, you have to trade off of what you're going to buy.

826
01:25:14,520 --> 01:25:17,440
I spoke back to the forecast and what the economy's going to do.

827
01:25:18,720 --> 01:25:21,300
It's a bit of a fact, a little bit of legislation for that.

828
01:25:22,260 --> 01:25:23,220
Very nice.

829
01:25:27,500 --> 01:25:36,760
On this next slide here, it's a, we have like a break out of just, you know, the CL, the pedals, the approval could.

830
01:25:37,520 --> 01:25:45,980
sales backs, looking at like six months, like just in seeing the year over your changes.

831
01:25:47,820 --> 01:26:06,440
And so, you know, as what sticks out on this is CL, as you can see, how much significantly higher the year over here, sales have been as compared to the state, the PL, the PL, the Cook County.

832
01:26:06,440 --> 01:26:16,300
But you know, when we put this together, we were using January to be both data for 2026 all the way on the right there.

833
01:26:16,560 --> 01:26:27,060
And so you could really see the CL coming down, as we think that's starting to moderate, at least coming closer to what it was before 2025.

834
01:26:34,740 --> 01:26:41,460
Is it part of say that this is given us some insight into the impact of inflation versus something else?

835
01:26:41,480 --> 01:26:45,780
Because the growth has not been very significant in the P.L.

836
01:26:46,900 --> 01:26:48,100
Compared to what inflation?

837
01:26:49,880 --> 01:26:50,940
Oh, but it's gone up again.

838
01:26:53,660 --> 01:26:53,680
Hmm.

839
01:26:53,680 --> 01:26:54,200
In 2026.

840
01:26:54,900 --> 01:26:55,420
Yeah.

841
01:26:55,420 --> 01:26:55,960
It was an end.

842
01:27:01,560 --> 01:27:04,560
It's possible that growth could have faster in the C.L.

843
01:27:04,560 --> 01:27:06,900
that's where the sales growth is.

844
01:27:09,640 --> 01:27:13,280
So it could still continue to grow there a little bit faster.

845
01:27:13,560 --> 01:27:18,230
Yeah, I think we would all agree that e-commerce sales are growing in a faster place than

846
01:27:19,420 --> 01:27:25,700
physical locations sales, right? So I think we're seeing this, that's somewhat reflected in

847
01:27:25,700 --> 01:27:28,140
this information, but also the change in legislation.

848
01:27:36,590 --> 01:27:38,610
So on this next slide here, we're

849
01:27:38,610 --> 01:27:45,430
I'm highlighting how the annual sales tax projections that we produce have changed over time.

850
01:27:45,990 --> 01:27:48,450
Going back to April of last year.

851
01:27:49,530 --> 01:27:53,190
And so, you know, just following the colors of the rainbow here,

852
01:27:53,470 --> 01:27:59,410
you could see that our forecasts in 2025,

853
01:27:59,410 --> 01:28:02,570
they were pretty close together in the out years,

854
01:28:02,790 --> 01:28:06,870
but for 2026 and for 2025, they were gradually increasing.

855
01:28:08,210 --> 01:28:31,430
And then in the more recent sales tax forecast for April and June, you could see that the base in the near term of what we're projecting has really increased as the 2025 and 2026 collections have just been much higher than we were projecting prior.

856
01:28:32,770 --> 01:28:36,650
But if you look at the out ears here in the table,

857
01:28:37,250 --> 01:28:42,430
below, you could see the U over your changes in 28 through 2030.

858
01:28:43,650 --> 01:28:45,110
It's pretty conservative.

859
01:28:45,650 --> 01:28:47,430
You know, a red around 2%.

860
01:28:49,030 --> 01:28:54,350
It's more so in 2026 that we've seen such a high increase

861
01:28:54,350 --> 01:28:56,050
in the U over your projections.

862
01:28:56,550 --> 01:29:00,650
And that's what's been our forecast for the sales tax

863
01:29:00,650 --> 01:29:01,830
the out years.

864
01:29:06,770 --> 01:29:10,390
And then the next slide is just the same thing. It's more of a monthly clicker

865
01:29:10,390 --> 01:29:19,090
tips though. Along with some black dots here, so in the actuals. And so you can see in the

866
01:29:19,090 --> 01:29:24,910
the left side of this subline chart, the actuals have been higher than what we were

867
01:29:24,910 --> 01:29:31,390
rejecting over time. We were producing earlier forecasts. And so that's what's

868
01:29:31,390 --> 01:29:39,410
We got more data and collections when we was driving the more recent forecast of the sales tax

869
01:29:39,410 --> 01:29:46,410
for the out years, but for the out years, the projections kind of follow a similar trend.

870
01:29:46,810 --> 01:29:52,170
It's just that the base has been hired as a result of more faithful references.

871
01:30:00,000 --> 01:30:07,600
That slide here. We wanted to just show some of the recent outputs from our direction model.

872
01:30:08,980 --> 01:30:20,140
You know, one reason why just showing what are the different coefficients, ingredients that go into the model, you know, we factor in

873
01:30:20,140 --> 01:30:29,120
So to see the quality, we include a dummy, a dummy vehicle, which we update each time you're on the phone fast.

874
01:30:30,300 --> 01:30:33,040
Trying to adjust for a resupply legislation.

875
01:30:33,900 --> 01:30:38,720
So that's sort of how it does not assume that we'll see growth into the out years.

876
01:30:39,940 --> 01:30:46,820
And then we have the different economic indicators that we've used going back to the last year,

877
01:30:46,820 --> 01:31:01,280
which we use retail sales for the Chicago MSA, as well as number of employed persons and number of households, both in the MSA to set the macro economic floor.

878
01:31:02,120 --> 01:31:14,560
And so, your model here, as far as the adjusted art square shows that about 96% of the movement in the base is reflected from the coefficients here.

879
01:31:16,420 --> 01:31:18,660
So I did, I'm sorry.

880
01:31:19,480 --> 01:31:23,260
Well, I was just going to say, we talked about this a bit in the briefing.

881
01:31:24,000 --> 01:31:26,900
I just think there's a lot to dig into here.

882
01:31:27,380 --> 01:31:32,140
And I'm going to suggest that this, I'm going to withhold my comments,

883
01:31:32,700 --> 01:31:35,500
but accept the request that we had explorers,

884
01:31:37,220 --> 01:31:38,820
but let's discuss it.

885
01:31:41,660 --> 01:31:43,320
It is a lot of discussion.

886
01:31:43,320 --> 01:31:47,100
And I was, you know, just, this is something I had kind of asked for.

887
01:31:47,500 --> 01:31:55,040
So if that comment on a little bit, one thing is that the coefficients are quite stable in each of the different forecasts.

888
01:31:55,240 --> 01:32:00,080
And that's, that's a good thing that applies to the model was like fundamentally changing.

889
01:32:00,080 --> 01:32:03,260
But the underlying actors were, right?

890
01:32:03,260 --> 01:32:08,040
So in terms of thinking about all of these things, there are sort of these one-off and slate jumps.

891
01:32:08,800 --> 01:32:11,540
But it is remarkably stable.

892
01:32:13,240 --> 01:32:17,360
Another way to sort of see that actually would be to,

893
01:32:17,360 --> 01:32:21,920
if you go up a couple of slides, back a couple of slides there.

894
01:32:22,700 --> 01:32:26,220
So if you look at the rainbow chart here, which is very cool,

895
01:32:26,360 --> 01:32:30,660
but the slopes of the lines in the out-years are basically all the same.

896
01:32:31,220 --> 01:32:33,740
So essentially, in all of your forecasts,

897
01:32:33,960 --> 01:32:36,260
you're predicting this as like a one-top.

898
01:32:36,260 --> 01:32:41,680
young, right, each time each updated forecast, that one time jumped, got a little bit bigger,

899
01:32:41,840 --> 01:32:47,160
but the slopes in all those out years are basically all the same. And so it's sort of saying

900
01:32:47,160 --> 01:32:55,160
all along your models, you can see that's one time thing, and it still is. And so that's the stability

901
01:32:55,160 --> 01:32:57,520
of the coefficients are certainly counting to that slope.

902
01:32:59,720 --> 01:33:01,880
Yeah, to your point about, for one period

903
01:33:01,880 --> 01:33:07,840
where there was some instability, that was, I think definitely an April, if you look at

904
01:33:07,840 --> 01:33:11,720
That speaks jump up or jump down, I guess,

905
01:33:12,160 --> 01:33:15,980
before kind of perverti back to closer to where it was,

906
01:33:16,520 --> 01:33:18,780
before in, you know, same with the retail

907
01:33:18,780 --> 01:33:21,920
that really jumped up to from the previous model

908
01:33:21,920 --> 01:33:24,020
or come to point it back down, it did happen.

909
01:33:24,280 --> 01:33:26,600
It is interesting, but the intercept jumped up.

910
01:33:26,600 --> 01:33:28,580
So it's like, you know, you're getting weird things

911
01:33:28,580 --> 01:33:31,240
that could just be kind of about setting each on that, right?

912
01:33:33,340 --> 01:33:36,240
Yeah, you'd have to, yes, spend a little time with it,

913
01:33:36,860 --> 01:33:37,440
but I don't know,

914
01:33:37,440 --> 01:34:00,920
I feel like the picture is helpful because that's your, your, your forecast from these coefficients and you really are seeing quite a bit of stability, especially, yeah, so you get a better sense of that trade off between, okay, a couple of things jumping around in that one period, but not like the slope changed a lot and then that would make you think like, oh, the model was saying, right, I was thinking about this is like a forever thing.

915
01:34:00,920 --> 01:34:02,440
So we want to, yeah,

916
01:34:12,920 --> 01:34:16,000
so we're not going to lose the portion on the fails facts.

917
01:34:16,740 --> 01:34:22,580
Yeah, I can shade off once back and I'm going to look forward to taking the session.

918
01:34:25,640 --> 01:34:39,100
So another part of the IRFC aside from analyzing revenues in our forecast is coming up with preliminary recommendations to be specific to see

919
01:34:39,100 --> 01:34:44,400
of OVU's floor August 1 and so that's what we're looking at today.

920
01:34:46,320 --> 01:34:51,400
And so one of the recommendations we have here is, you know, something that we've

921
01:34:51,400 --> 01:34:58,280
recognized previous years but continuing to think about fiscal sustainability from our but

922
01:35:00,000 --> 01:35:22,180
Dean mentioned earlier, you know, we're thinking about the allocation of the reserves that we have for our programs, continuing to collaborate with them in the coming months and a year, thinking about different funding options for the programs that are in place, and if they will continue to remain, it's a down year's afternoon basis.

923
01:35:25,510 --> 01:35:33,670
The next recommendation is a value-weighting of a witty of suffice used by the county and

924
01:35:33,670 --> 01:35:41,770
exploring potential modifications to existing revenues that are in the county's budget and federal fund.

925
01:35:43,050 --> 01:35:49,610
So, as you can see from the alligator chart here that was referenced earlier in 2027 and

926
01:35:49,610 --> 01:35:57,430
the out years we're looking at some pretty significant deficits in general fund. So, you know,

927
01:35:57,430 --> 01:36:04,390
as the county would maybe look at different scenarios to potentially modify taxes that are

928
01:36:04,870 --> 01:36:12,330
currently in place in general funds, you know, assessing the validity of the methods used by

929
01:36:12,330 --> 01:36:16,410
county through the experiment that these are sounds.

930
01:36:18,130 --> 01:36:19,550
Is this some,

931
01:36:22,940 --> 01:36:26,880
are some of the ones that we've talked about today, the examples of what we've

932
01:36:26,880 --> 01:36:27,760
fallen under this umbrella?

933
01:36:28,280 --> 01:36:28,640
Yeah.

934
01:36:29,380 --> 01:36:32,060
I don't think quite kind of can continue like that as well.

935
01:36:32,620 --> 01:36:34,520
So the value is the validity of methods.

936
01:36:35,380 --> 01:36:38,220
So I guess I'd like to explore that a bit further.

937
01:36:38,700 --> 01:36:43,160
I'm not mechanism through which that happens because you know we brought up the last

938
01:36:43,160 --> 01:36:49,320
to be using additional research surgeon. The focus is on the methodology, which we talked

939
01:36:49,320 --> 01:36:57,670
yesterday. How much direction on the methodology and questions

940
01:36:57,670 --> 01:37:02,850
answering the work sessions? Are you guys going to be able to provide for us to fulfill

941
01:37:02,850 --> 01:37:03,850
that responsibility?

942
01:37:09,840 --> 01:37:12,880
And the last recommendation, I'm sorry,

943
01:37:14,980 --> 01:37:18,840
I don't see any reason to strict this to the general fund.

944
01:37:21,630 --> 01:37:26,350
So I don't know if that's implied here or not, but I guess any revenue too.

945
01:37:27,070 --> 01:37:32,550
I mean, I think the health care revenues are like a, that's largely farmed out.

946
01:37:33,330 --> 01:37:40,050
But, you know, any certainly any tax rate, it seems, we should have a consistent amount of knowledge.

947
01:37:40,050 --> 01:37:49,070
I think I don't know if you want to chime in, but the general fund has a lot of our home rule taxes.

948
01:37:49,790 --> 01:37:56,310
So kind of starting there, I think was some of the thinking behind just name the general fund.

949
01:37:56,470 --> 01:38:00,350
I don't think there are any taxes outside of the general fund.

950
01:38:00,670 --> 01:38:08,470
Yeah, maybe like a special purpose fund, but I can't think of anything significant.

951
01:38:08,470 --> 01:38:11,750
here. Certainly not at the hospitals, right?

952
01:38:14,290 --> 01:38:18,410
So that so it's limited to

953
01:38:20,490 --> 01:38:21,730
this rapid edition.

954
01:38:22,230 --> 01:38:31,870
This is a limited tax. It's really not talking about, I guess, fees, finance, as well, but not for justice left out there.

955
01:38:33,770 --> 01:38:40,190
Sometimes you do things do come out, but that's fine. If we want to restrict it, we want to focus on

956
01:38:40,190 --> 01:38:41,390
it's not my sense.

957
01:38:44,860 --> 01:38:47,260
Yeah, I think that would tell us a lot of

958
01:38:47,260 --> 01:38:48,700
preference here.

959
01:38:51,140 --> 01:38:51,820
The feed is

960
01:38:54,920 --> 01:38:56,720
food. So if you

961
01:38:56,720 --> 01:38:59,760
will feed, right, it should be consistent with the cost that we're

962
01:38:59,760 --> 01:39:04,760
preparing. I need to know how you wish it to make sure cost. I

963
01:39:04,760 --> 01:39:09,840
should. Yeah, so that that's yeah, that's not something that

964
01:39:09,840 --> 01:39:14,880
is for consideration. Yeah. Well, like what we're doing, what you're

965
01:39:14,880 --> 01:39:19,800
by the gambling stations.

966
01:39:20,740 --> 01:39:25,820
That's, I guess it's the tax, I'm not sure exactly what separates

967
01:39:25,820 --> 01:39:28,520
the tax from a fee in that point, right?

968
01:39:28,880 --> 01:39:29,580
Yeah, that's what I'm saying,

969
01:39:32,060 --> 01:39:35,500
but okay, yeah.

970
01:39:41,020 --> 01:39:46,880
And then this third recommendation is to establish a protocol

971
01:39:46,880 --> 01:39:59,160
to evaluate new and alternative revenues sources, not in county's budget with the IRFC to address the out here of structural deficits in general fund.

972
01:40:00,050 --> 01:40:20,430
I'd like you guys to think about this, but more give some more direction at the next meeting. So, again, separating policy from methodology and the role that we're supposed to have is a legal consideration or an implementation feasibility considered more policy or methodology.

973
01:40:22,450 --> 01:40:28,630
So, I would like to clear understand the expectations that you guys would have of me.

974
01:40:30,050 --> 01:40:30,670
Yeah, I agree.

975
01:40:39,040 --> 01:40:47,700
And so, just after August, there's a company in a company that's very direct to the

976
01:40:47,700 --> 01:40:54,640
nations, they'll also include the kind of deliver of timelines for these three items.

977
01:40:55,500 --> 01:40:59,500
And that will get submitted to the board, September.

978
01:41:01,020 --> 01:41:07,080
So we'll be working to draft this work and I mean weeks and you know, wouldn't want to

979
01:41:07,080 --> 01:41:17,620
And back to incorporate that into the report, so that we can, yeah, I have, make sure there's clear guidance and direction that's seen forward.

980
01:41:18,080 --> 01:41:20,120
That's good.

981
01:41:21,040 --> 01:41:29,080
And then leading calendar just some of the upcoming key to have another one. Next month on the 26th.

982
01:41:29,860 --> 01:41:42,440
And then we're break until October, we'll be presenting the next long term forecast and need a second of your recommendation for 2027.

983
01:41:44,300 --> 01:41:50,200
So I'm wondering if we can move the meeting on the 26th book because I'm teaching on Wednesday nights now.

984
01:41:50,820 --> 01:41:54,780
And the October one as well as on Wednesday night. So I'm going to be able to attend either of

985
01:41:57,370 --> 01:41:57,750
those.

986
01:41:57,750 --> 01:42:04,650
Yeah, we could talk after this, see if there's a better date at, let's see if everything

987
01:42:04,650 --> 01:42:06,890
all of this stuff.

988
01:42:10,530 --> 01:42:14,210
If you have a, if it's better, it's better, so I didn't check my calendar.

989
01:42:14,970 --> 01:42:18,290
Uh, I think any other day is...

990
01:42:18,290 --> 01:42:19,010
Good thing.

991
01:42:20,890 --> 01:42:23,430
Well, if you all have a chance, I have a chance.

992
01:42:25,810 --> 01:42:31,130
Uh, but, uh, share that, please, our presentation.

993
01:42:31,130 --> 01:42:32,130
Thank you.

994
01:42:32,710 --> 01:42:33,170
Thank you.

995
01:42:35,230 --> 01:42:36,070
That's right.

996
01:42:36,130 --> 01:42:38,150
Among the attendees public comment.

997
01:42:38,690 --> 01:42:40,390
We have any public speakers.

998
01:42:42,830 --> 01:42:43,470
No.

999
01:42:44,070 --> 01:42:46,570
We do not have any registered public speakers.

1000
01:42:50,480 --> 01:42:53,660
Can we do we have any public speakers?

1001
01:42:54,080 --> 01:42:59,220
We have no registered public speakers in the chat box.

1002
01:42:59,360 --> 01:43:00,720
Thank you.

1003
01:43:00,880 --> 01:43:02,840
The next item on the agenda is a term.

1004
01:43:02,840 --> 01:43:05,100
is there a motion to adjourn?

1005
01:43:06,100 --> 01:43:08,100
I'll make the motion to adjourn.

1006
01:43:08,100 --> 01:43:09,340
Is there a second?

1007
01:43:10,760 --> 01:43:11,320
I'll make the motion to adjourn.

1008
01:43:11,320 --> 01:43:11,520
Great.

1009
01:43:11,700 --> 01:43:14,560
The motion to adjourn has been moved by Commissioner

1010
01:43:14,560 --> 01:43:17,780
Bavila and second by Commissioner Favila.

1011
01:43:22,110 --> 01:43:23,470
All those in favor of signifying.

1012
01:43:26,790 --> 01:43:29,790
In the opinion of the chair, the eyes have it.

1013
01:43:29,810 --> 01:43:30,790
The meeting is adjourned.

1014
01:43:30,910 --> 01:43:33,930
The next meeting will be

1015
01:43:33,930 --> 01:43:36,150
Wednesday, August 26.

1016
01:43:36,990 --> 01:43:38,890
20 for the 6th standard.