November 14, 2012
The Cook County Board of Commissioners approved the FY2013 Annual Appropriation bill (FY2013 budget) on November 9. The budget was approved with a 16-1 vote.
The Cook County FY2013 Executive Budget Recommendation was released on October 18 and the Civic Federation released its analysis of the budget on October 26, 2012. Since then, some of the proposed revenue enhancements underwent changes before being approved by the Board’s Finance Committee on November 2. The affected revenue enhancements include the non-titled use tax, the gambling machine tax and the ammunition and firearm taxes. It should be noted that the Civic Federation’s analysis of the FY2013 budget was based on the original proposed budget document and does not reflect these more recent changes.
The following information highlights the changes made to these revenue enhancements, as recommended by President Preckwinkle and as approved by the Finance Committee. The information below also includes changes to FY2013 revenue projections.
Non-titled use tax - The exemption for the 1.25% “non-titled” use tax on personal property purchased outside of Cook County will increase from $2,500 to $3,500 in annual purchases. The tax will go into effect on April 1, 2013. The FY2013 projected revenue for this tax declined from $15.0 million to $13.8 million.
Gambling machine tax – The tax on gambling machines was revised from the originally proposed annual tax of $800 on all gambling machines to a two-tiered system. Electronic gambling devices, such as slot machines, will be taxed at an annual rate of $1,000 and video game terminals, such as video poker machines, will be taxed at an annual rate of $200. The tax will become effective on June 1, 2013. The FY2013 projected revenue for this tax fell from $1.3 million to $1.2 million.
Ammunition/firearm taxes – The proposed ammunition tax of $0.25 per bullet was eliminated; however, the $25 per firearm tax remains. Exempt from the tax are bona fide veterans’ organizations which receive firearms directly from the Armed Forces of the United States and use firearms for ceremonial purposes. Also exempt are active sworn law enforcement officers purchasing firearms for official or training purposes. The tax is effective April 1, 2013. The FY2013 projected revenue for this tax declined from $1.0 million to $600,000.
Originally, the total projected FY2013 revenue for these three revenue enhancements was $17.3 million; as a result of the amendments to the taxes, the updated estimated revenue is $15.6 million. This is a decrease of $1.7 million, or 9.8%. The decline in revenue is expected to be made up through savings in electricity and communication services costs to the Cook County Health and Hospitals Systems, as stated in the amendments approved by the Finance Committee on November 9.