The Village of Oak Lawn’s sales tax revenue increased by about $1.9 million dollars from 2012 through 2014. This appears to have given officials an excuse to gloat about economic development. Of course, eventually it was admitted that Oak Lawn’s sales tax revenue and gas tax revenue increases were due in large part to tax increases.
Trustee Terry Vorderer started the discussions with his “new business report”. He said the village staff shared numbers on economic recovery that he wanted to share with the public. He said sales tax revenue increased from 2013-2014 by 5.6%. Vorderer said, “Oak Lawn was the number five of the top 20 suburbs in increases in sales.” He said the 5.6% increase was the highest in the south suburbs.
Village Manager Larry Deetjen confused the issue by discussing the value of “talking positive about Oak Lawn” while then attacking developments under former Mayor Ernie Kolb. He praised Hamilton Partners while attacking Prairie Town Centers, Home Depot and other projects even though Vorderer never discussed the other developments, which include condo developments in the center of town. No Trustees or other elected officials that supported any of those developments remain on the board. The only Trustee on the Board at the time those developments were built, Robert Streit (Dist. 3), voted against each of the projects cited by Deetjen. When asked yesterday by phone what Deetjen’s point was in attacking Kolb and the former Mayor’s Coalition Party, Streit said “I have no idea”.
Not to be left out, Trustee Tim Desmond (Dist. 1) while also appearing to read from notes, repeated one of Vorderer’s points in the form of a question. He asked, “just one other statistic Larry (Deetjen) on we were talking about the Oak Lawn sales, not only were we number five out of twenty but we were the only south suburb to make the top twenty?”
Deetjen followed the question noting that even though Oak Lawn doesn’t have a mall, its reliance on cars and food have been better for the numbers. “Statistically two industries–apparel, furniture… actually three, electronics–saw a poor performance in 2014 as it compared to 2013 and anyone who had a sizeable number of stores, big box stores, they saw either declines or little growth,” Deetjen said. He said “Oak Lawn chose the right industries for growth, i.e. food sales, eating and drinking establishments and smaller businesses.”
Oak Lawn’s Finance Director Brian Hanigan also spoke about the increase in sales tax revenue but he told Deetjen and the board that there was another way to look at it. He then explained that Oak Lawn did have a tax increase of $100,000 a month or $1.2 million a year. He said the budget used to have thirteen million in revenue from sales tax and now receives fifteen million annually.
The village’s records show that in 2012, the Village received $13,849,412 in sales tax revenue. However, after increasing taxes from .50% to .75%, revenue skyrocketed by $1,354,898 in 2013, a 9.78% increase. The increase from 2013-2014 was only 3.83%.
The total increase, if analyzed to account for the tax increase, shows that the total increase in revenue for 2013 and 2014 was $1,937,380. The increase from 2013 to 2014 was only $582,492 leading to the conclusion that although some of the increase was due to growth in sales and higher prices, 69.9 percent of the revenue increase occurred in the first year after the sales tax increase as pointed out by Hanigan.
Trustee Alex Olejniczak (Dist. 2) defended tax increases in the area of sales taxes and gas taxes. He said Oak Lawn was number five in fuel tax sales. “We went with a fuel tax increase and many people were concerned about that but instead of putting into a property tax increase we went for fuel tax and by doing that we still saw an increase in our sales from the fuel tax side too,” said Olejniczak. He added, “those are good things because when we can find revenue from other sources that keeps us away from having to raise property taxes and that’s what I believe everyone here should be looking at doing with providing the same if not better services.”