A binding referendum question will appear on the March 19 primary ballot in McHenry County seeking to increase its sales tax allotment on most goods by one-quarter percent.
Approved by the County Board last month, its aim is to provide a different revenue stream for mental health services rather than an appropriation through the annual property levy.
The actual question reads: “To pay for mental health purposes, shall McHenry County be authorized to impose an increase on its share of local sales taxes by one-quarter percent (.25 percent) and discontinue the current property tax levy funding mental health services and the Mental Health Board?”
If approved by voters, the increase would go into effect July 1, 2024. An additional 25 cents in sales tax would be charged on $100 of tangible personal property, as defined by the Illinois Department of Revenue. County estimates indicate approval would remove nearly $11 million form the property tax levy allocated for the mental health board, as of Nov. 30, 2024.
“Drug and groceries are not part of proposed sales tax increase,” said District 4 Board member Joe Gottemoller. “Services are currently funded by property taxes, so these would be almost $11 million that never leaves the pocket. It represents almost one-quarter of the overall property tax that is the county’s portion.
“People that buy these products in McHenry County would be paying for these services, which is a different spread,” Gottemoller said. “It presents people with the option as to what direction to take.”
The County Board has been looking for ways to pay for materials and services without adding to the property tax levy. Board members approved a 3.3 cents per gallon increase to its gas tax, last September, which took effect Jan. 1. The gas tax is expected to add $3 million in new revenues. The overall gas tax is now 8 cents per gallon.
According to the Illinois Policy Institute, McHenry County ranked fourth in the state, and 35th nationally in assessing the highest median property taxes in 2017. While the lion’s share goes to the school districts, the state of Illinois ranked second in the nation for the highest property tax rate in 2023.
“Since 2012, the board has reduced their end of the overall levy significantly, when it was $79 million,” said Gottemoller. “Next year, it’s down to $61 million.”
If approved, the referendum would impact the 2025 tax bill by removing the county mental health board’s portion of the property tax levy. Should the referendum be rejected, the mental health board would continue to receive its funding from property taxes. The board provides services for disabled individuals and substance abuse treatment.