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HomeMy WebLinkAboutORDINANCE - 1960 - 4/12/1988 - ESTABLISH TAXORDINANCE NO. 1960 AN ORDINANCE ESTABLISHING A TAX ON THE PURCHASE OF PREPARED FOOD AND ALCOHOLIC LIQUOR IN THE VILLAGE OF ELK GROVE VILLAGE WHEREAS, the Village of Elk Grove Village is a Home Rule Municipality as defined and set forth in the Constitution of the State of Illinois and is empowered by the provisions thereof to enact legislation pertaining to its government and affairs, including the power to tax; and WHEREAS, the Village deems it to be in the best interest of the Village to establish a municipal tax upon the purchase of prepared food and alcoholic liquor in the Village; NOW, THEREFORE, BE IT ORDAINED, by the President and Board of Trustees of the Village of Elk Grove Village, Counties of Cook and DuPage, Illinois as follows: Section 1: That Chapter 18 of the Municipal Code of the Village is hereby amended by adding thereto a new Article entitled "Food and Beverage Tax" a copy of which is attached hereto as Exhibit A, and by this reference incorporated herein. Section 2: That all information received by the Village of Elk Grove Village from returns filed under this Ordinance, or from any investigations conducted under this Ordinance, shall be confidential, except for official Village purposes. Section 3: That this Ordinance shall be in full force and effect from and after its passage, approval and publication according to law. VOTES: AYES: q NAYS: 2 ABSENT: 0 APPROVED: Charles J. Zettek VILLAGE PRESIDENT ATTEST: Patricia S. Smith VILLAGE CLERK PASSED this 12th day of April , 1988. APPROVED this 12th day of April 1988. PUBLISHED this 21st day of April 1988, in pamphlet form. -2- EXHIBIT A ARTICLE LVIII PREPARED FOOD AND ALCOHOLIC LIQUOR TAX 18.5801 Definitions.) For the purposes of this Article, unless the context otherwise requires, the following words or terms shall have the meanings respectively applied to them: A. "Alcoholic Liquor" means any alcohol, spirits, wine or beer as defined, set forth and regulated in Article XII of this Chapter which is sold at retail either for consumption on the premises where sold or is sold in its original package for consumption off the premises. B. "Prepared Food" means and includes any solid, liquid (including both alcoholic and non-alcoholic liquid), powder or other food substance used or intended to be used for human consumption and which has been prepared for immediate consumption, either on the premises where sold or for consumption off the premises. With respect to food purchased for consumption off the premises, except alcoholic liquor, "Prepared Food" shall not mean or include any food which is sold in a closed or sealed bottle, can, carton, container or wrapper of the manufacturer or wholesaler. C. "Purchase at Retail" means to obtain for use or con- sumption in exchange for a consideration, whether in the form of money, credits, barter or any other nature, and not for resale. D. "Retailer" means any person who sells or offers for sale prepared food and/or alcoholic liquor for use or consumption and not for resale. E. "Prepared Food Facility" means establishments subject to the licensing requirements of Chapter 18 of the Municipal Code as a food service establishment which sell prepared food at retail whether or not such facility is conducted along with any other use(s) in a common premise or business establishment. A "Prepared Food Facility" includes but is not limited to those establishments commonly called an inn, restaurant, eating place, drive-in restaurant, bakery, cafeteria, cafe, lunch -counter, fast food outlet, catering service -1- coffee shop, diner, sandwich shop, soda fountain, tavern, bar, cocktail lounge, ice cream parlor, delicatessen, movie theater, mobile food, beverage or ice cream vending vehicles, hotel, motel or club. A "Prepared Food Facility" does not include food stores (except facilities therein which sell prepared food and alcoholic liquor), churches, public or private schools, boarding houses, day care centers, nursing homes, retirement centers or similar residential care facilities or programs for the central preparation of meals to be delivered and consumed at private resi- dences of invalids or the elderly, coin-operated auto- matic food item dispensing machines, hospitals (except facilities therein subject to the State of Illinois Retailer Occupation Tax pertaining to food sales) and facilities of not-for-profit associations or corpora- tions. F. "Retail Liquor Facility" means any establishment licensed under the provisions of Article XII of this Chapter of the Municipal Code of Elk Grove Village. 18.5802 Tax Imposed.) Commencing on the 1st day of July, 1988, a tax, in addition to any and all other taxes, is imposed upon the purchase of prepared foods and alcoholic liquor at retail at any Prepared Food Facility or Alcoholic Liquor Facility within the Village, at the rate of one (1%) percent of the purchase price of such prepared food and alcoholic liquor, the ultimate incidence of and liability for payment of which shall be borne by the purchaser thereof. 18.5803 Collection of Tax by Retailer.) The owner and operator of each Prepared Food Facility and each Alcoholic Liquor Facility within the Village shall jointly and severally, have the duty to collect and account for said tax from each purchase at the time that the consideration for such purchase is paid. -2- 18.5804 Books and Records.) The owner and operator of each Prepared Food Facility and each Alcoholic Liquor Facility within the Village shall jointly and severally, have the duty to maintain complete and accurate books, records and accounts, showing the gross receipts for sales of prepared food and alcoholic liquor and the taxes collected each day, which shall be made available to the Village for examination and for audit by the Village upon reasonable notice and during customary business hours. 18.5805 Transmittal of Tax Collection.) The owner and the operator of each Prepared Food Facility and each Alcoholic Liquor Facility within the Village shall jointly and severally, have the duty to cause to be filed a sworn return with the Finance Director for each such facility and for each such licensed premises located in the Village. Said return shall be prepared and submitted on forms prescribed by the Village. Said return shall be filed with the Village by the filing date and at the same time intervals or frequencies as the Retailers Occupation Tax Return, form RR -1-A, is due to be filed with the Illinois Department of Revenue. Said return shall also be accompanied by payment to the Village of all taxes imposed by this Ordinance which are due and owing for the period covered by said return. Said return shall also be accompanied with a copy of the return filed with the Illinois Department of Revenue for sales within the Village of Elk Grove Village covering the same reporting period. -3- 18.5806 Late Payment Penalty.) If any tax imposed by this Ordinance is not paid when due, a late payment penalty equal to two (2%) percent of the unpaid tax shall be added for each month, or any portion thereof, that such tax remains unpaid and the total of such late payment penalty shall be paid along with the tax imposed hereby. 18.5807 Transmittal of Excess Tax Collections.) If any person collects an amount upon a sale not subject to the tax imposed hereby but which amount is purported to be the collection of said tax, or if a person collects an amount upon a sale greater than the amount of the tax so imposed herein and does not for any reason return the same to the purchaser who paid the same before filing the return for the period in which such occurred, said person shall account for and pay over those amounts to the Village along with the tax properly collected. 18.5808 Enforcement.) License Suspension, Revocation. Payment and collection of said tax and any late payment penalty may be enforced by action in any court of competent jurisdiction and failure to collect, account for and pay over said tax and any late payment penalty shall be cause for suspension or revo- cation of any Village license issued for such Prepared Food Facility or Alcoholic Liquor Facility applicable to the premises thereof all in addition to any other penalty in this Ordinance. 18.5809 Penalty.) Any person operating a Prepared Food Facility or an Alcoholic Liquor Facility within the Village failing or -4- omitting to pay said tax when due, or failing or omitting to collect, or to account for, or to pay over said tax and any late payment penalty, or failing to maintain or allow examina- tion of the required records shall, in addition to any other payment or penalty provided herein or elsewhere by law or ordi- nance, upon conviction be fined not less than Two Hundred ($200.00) Dollars nor more than One Thousand ($1,000.00) Dollars for each such offense, and each day a violation continues shall be con- sidered a separate violation. 18.5810 Effective Date.) These provisions shall be in full force and effect as of July 1, 1988. -5- SAMELSON, KNICKERBOCKER & ASSOCIATES ATTORNEYS AT LAW NOFLMAN E. SAMELSON GEORGE B. KNICKERBOCKER WILLIAM J. PAYNE April 6, 1988 To the President and Board of Trustees of Elk Grove Village 901 Wellington Avenue Elk Grove Village, IL 60007 RE: Prepared Food and Alcoholic Liquor Tax Dear President and Board of Trustees: 575 LEE STREET DES PLAINES, ILLINOIS 60016 TELEPHONE (912) 827-5117 Attached to this letter is a proposed copy of an Ordinance with respect to the above referenced matter. The Ordinance was prepared in conjunction with the Department of Finance after reviewing similar Ordinances of neighboring communities. After preparing the Ordinance it was deemed appropriate to point out several policy matters which I believe the Board should discuss prior to the adoption of said Ordinance. The primary concern is with respect to Section 18.5801 E., the definition of the "Prepared Food Facility". The Ordinance includes taxation on bakeries except for bakeries which do not have facilities for on -premise consumption. The thought here was to include restaurant type bakeries such as Dunkin Donuts but exclude all other types of bakeries. Other Villages impose the tax on all bakeries but such regulation would appear to lead to a taxation on baked goods in a bakery and the exemption of same in a food store. Secondly, several Villages regulated and taxed hospitals and others exempted hospital food establishments. The Ordinance as proposed would exempt normal hospital food service but would impose a tax on hospital food facilities which at the present time pays a similar type of tax to the State of Illinois under the Retailers Occupation Tax. A third item for consideration was whether or not to include municipal corporations such as food service establishments by the Park District. The Ordinance as written would impose the tax on alcoholic sales and prepared food sales by the Park District and any other municipal organization which engages in that busi- ness. Since the revenues of food and alcoholic sales ultimately benefit the taxpayer as the proceeds seemingly fund Park District services, it would be justifyable to exempt municipal entities as well. SADIELSON, KNICKERBOCKER & ASSOCIATES ATTORNEYS AT LAN Page 2 The above are the major areas of policy consideration which need to be discussed. Other quasi -policy considerations such as the exemption of coin-operated vending machines, were made as a result of eliminating enforcement problems especially where little revenue was anticipated. As indicated, the effective date of this Ordinance will be July 1, 1988 which coincides with the filing of quarterly State of Illinois returns in addition to giving the Finance Department sufficient time to prepare necessary forms and educate the business people subject to this tax. Hopefully these matters can be discussed prior to the regularly scheduled meeting at 8:00. Very truly yours, SAMELSON, KKNICKERBOCKER & ASSOCIATES Ge�./Knickerbocker GBK:clt Encl.