Evanston balks at proposed new taxes, hikes

Several tax increases included in Evanston’s 2005-06 budget proposal — along with the creation of a new tax on restaurants — have business and property owners calling for city officials to re-examine the way they approach the annual budget.

The budget, released online Tuesday, includes proposals to raise property and cigarette taxes and create a new tax on restaurant food and beverages.

Scott Anderson, director of marketing for Clean Plate Club Restaurant Group, which operates Merle’s Barbecue, 1727 Benson Ave.; Pete Miller’s Steakhouse, 1557 Sherman Ave.; and the Davis Street Fishmarket, 501 Davis St., said further increases in city taxes on restaurants will make Evanston restaurants less competitive with restaurants in surrounding areas.

“I don’t know if it will cause restaurants to move to other places,” Anderson said. “But I can guarantee it will cause restaurants to think twice about coming to Evanston.”

Dick Peach, a member of the Evanston Chamber of Commerce’s board, said the suggested 1 percent tax on food and beverages will “go over like a lead balloon” with Evanston restaurant owners. Peach said representatives of the Chamber of Commerce will be attending the city’s scheduled Saturday morning budget workshops to warn aldermen that increasing taxes will cause business owners to close and move to other communities.

Dan Kelch, owner of Lulu’s Dim Sum and Then Sum, 804 Davis St., said this is not the first time restaurant owners have had to fight proposals for tax increases. Kelch said although a 1 percent tax may seem innocent enough, he doesn’t want to see it increase like 6 percent tax currently levied on restaurant liquor sales.

“What worries us in the industry more than anything is if you implement the tax, it makes it easier to keep raising the tax,” he said

Restaurant owners aren’t the only ones worried about suggested tax hikes. Evanston tobacco store owners are also concerned about a proposed 8-cent increase in the cigarette tax.

Abdul Hakeem, former owner of Evanston Pipe & Tobacco, 923 Davis St., said he’s against the tax because it isn’t fair to smokers and it creates more problems for business owners who already have been hit with several cigarette tax increases. In February the Cook County Board of Commissioners voted to increase the county cigarette tax to $1 per pack.

“This year our business has dropped 70 percent,” Hakeem said. “What are we going to do, pack up and go?”

Hakeem said he wants to tell his customers to protest the tax.

Residents also are preparing to protest another increase in property taxes. This year’s budget proposal includes a 3.98 percent increase in the city’s portion of the property tax, which translates to a 0.75 percent increase in a resident’s property tax bill.

Community activist Junad Rizki said he plans to attend Evanston’s first budget workshop this Saturday with a stuffed pig he refers to as the “Evanston tax hog.” Rizki started bringing the pig to meetings last year as a way to bring attention to the city’s reliance on tax increases to solve budget problems.

“The truth of the matter is they aren’t going to cut any services or anything we already have,” Rizki said. “They just keep on raising taxes.”

Peach agreed that the city is going to have to start looking for new ways to fix gaps in the budget.

“You can’t squeeze blood from a rock,” he said. “There just isn’t any more money out there. The reality is you have to cut stuff, folks.”

Reach Breanne Gilpatrick at [email protected].