Bloomington, Normal and McLean County agree to 12‑month pause, audit of shared sales‑tax fund

Bloomington City Council on Monday voted to approve a 12‑month pause in the city’s monthly payments to McLean County under the shared sales‑tax intergovernmental agreement and to require a third‑party audit of the county’s mental‑health/public‑safety fund.

City Manager Jurgens told the council the pause would let the city “direct how that money should be spent” for roughly one year while the county maintains operations from a roughly $20,000,000 fund balance. He said the pause carries “no risk to the county” because the county may provide notice and ask the city to resume payments earlier than 12 months if needed.

The pause is contained in amendment number 1 to the revenue‑sharing IGA and passed after Council Member Ward successfully proposed additional language that requires the city, during the suspension, to use the paused revenues “exclusively for community behavioral health initiatives, services, and programs consistent with the McLean County Mental Health Action Plan 2022 update, and any updates.” The council also approved amendment number 2, which directs a third‑party audit of the county fund, with a cap of $50,000 on audit costs.

Why it matters: shared sales‑tax revenues have risen sharply because recent state law changes increased the amount of internet sales tax allocated to municipalities. City staff projected annualized payments could top about $3,500,000 next fiscal year. Council members said the pause and audit will allow the city, town and county to reassess how the fund is used and to make sure the money supports the intended behavioral‑health programs.

Details and discussion

City Manager Jurgens summarized the proposal as a one‑year pause in town/city payments while the county would draw on its fund balance, estimated at more than $20 million, to meet obligations. Jurgens said the city and town had contributed roughly $40 million collectively to the county fund since FY2016 and that changes in how online sales are calculated have materially increased the city’s contributions.

Council Member Ward moved an amendment that would narrow the use of paused funds to behavioral‑health initiatives consistent with the county’s Mental Health Action Plan; the amendment was accepted and seconded. Ward said the measure was intended to “hold all of us accountable to addressing [behavioral‑health needs] as soon as possible.”

Council discussion included repeated assurances from the city manager and other members that the pause does not mean cuts to behavioral‑health funding. Council Member Scott, who spoke about personal experience with behavioral‑health impacts in his family, said he supported the pause as a chance to “regroup” and coordinate with county and town partners.

Council Member Montney and others pressed procedural and timing questions about the audit and whether interest on the county balance is included in the $20 million; the city manager said staff would follow up with the county for those details.

Formal action

- Motion: Approve amendment number 1 (12‑month pause) and amendment number 2 (audit) to the revenue‑sharing IGA, as amended by Council Member Ward to limit use of paused funds to behavioral‑health initiatives consistent with the McLean County Mental Health Action Plan 2022 update and future updates. - Mover: Council Member Hendricks (initial motion to approve amendment number 1); Ward moved the limitation/amendment and it was accepted and seconded. - Second: Council Member Scott (second to initial motion); seconded to Ward’s amendment by Council Member Scott. - Vote: Motion and amendment passed (no nays announced on final vote).

Next steps

The county will proceed with the third‑party audit; council requested details about timeline, scope and the handling of interest and will expect staff follow‑up. If the county notifies the city during the pause that it needs resumed payments, payments would restart per the IGA amendments.

Ending

Council members described the action as a pause and check‑in, not a permanent reallocation, and said future spending priorities for the paused amount will be presented to the council for approval before any funds are allocated.