The Finance & Purchasing Committee received a staff briefing on Aug. 18 about a state-level change to the grocery tax and a municipal decision deadline.

Finance Director Juan told the committee the state’s grocery tax will cease to be a state-collected source unless each municipality elects to continue a local 1% tax. “The state has put in the hands of the municipalities to adopt their own local grocery tax. If they choose, it would still continue to be the 1%,” Juan said, and added that municipalities must act by Oct. 1, 2025, for the tax to remain in effect Jan. 1, 2026.

Juan said Waukegan currently collects about $1,880,000 annually from the grocery tax (he described that figure as an approximate, year-to-year amount), and the city could lose roughly $2 million in general revenue if it does not adopt the local levy. Committee members noted that the timing matters for the fiscal year and that adopting the tax requires formal action by Oct. 1. Staff said the Finance Committee will revisit the subject at the committee’s Sept. 15 meeting so the city can submit a certified copy to the state if council chooses to continue the tax.

No ordinance or resolution was introduced or voted on at the Aug. 18 meeting; the briefing was informational. Committee members asked about which services could be affected if the revenue were not maintained and were told such cuts would depend on subsequent council budget decisions.