The sponsor of a measure that would give local governments the ability to tack on a municipal gas tax on top of state and federal gas taxes said it was designed to level the playing field inside the state’s boundaries, but a group representing convenience stores said it would make Illinois even more of an outlier compared to neighboring states.
Senate Bill 2978, filed earlier this month, would open up the ability for all municipal governments to tack on an extra 3 percent gas tax to the state and federal gas tax.
Bill sponsor, state Sen. Bill Cunningham, D-Chicago, said the bill wasn't going to move anytime soon, but it could come up before the end of the legislative session. He said it would open up local control of local gas taxes.
“If people in those towns are complaining about side streets for instances not being repaired, not being repaved, potholes not being fixed, this would be a way for the local municipalities to address that,” Cunningham said.
Josh Sharp with the Illinois Petroleum Marketers Association said Illinoisans were just hit with a doubling of the state’s gas tax. Along with other driving fee increases, a multi-year $45 billion capital construction bill enacted this summer increased the state’s gas tax from 19 cents to 38 cents a gallon. Sharp said Cunningham’s measure would give local governments a “blank check.”
“We think that’s a bad idea,” Sharp said. “The state of Illinois is already generating about $100 million more a month off a doubling of the gas tax. We just want to see how that money works out. Let it work, let it fund the state budget before we start imposing new taxes.”
Sharp also said Illinois charges a sales tax on top of state and federal gas taxes, which most other states don't do.
If the bill were to pass, Cunningham said it would level the playing field within Illinois’ borders.
“Right now if you’re a convenience store or gas station in Cook County and you’re across the street from DuPage County or Will County you’re at a disadvantage position because people can cross the street and not pay the tax,” Cunningham said.
Sharp said the real border dilemma is with other states’ gas taxes compared to Illinois.
“Illinois is about 52 cents a gallon, Missouri is 17 [cents a gallon],” Sharp said. “You start adding, compiling more taxes on top of that, you just make Illinois retailers all that more uncompetitive in what’s already an uncompetitive environment around the borders.”
Sharp’s group has also said other state mandates, including the recent minimum wage increase with another increase set for this summer, would further squeeze convenience stores.
State lawmakers left Wednesday for the week. They’re off next week. Some observers have said they don’t expect much to happen until after the March 17 primary.