CITY COUNCIL AGENDA ITEM
ACTION REQUESTED:
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Waive the first reading and pass the ordinance amending Section 3-1-9 of the Naperville Municipal Code, increasing the 2026 Special Events and Community Arts Grant Program funding cap to $2,510,000 (requires six positive votes)
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DEPARTMENT: Finance Department
SUBMITTED BY: Raymond Munch, Director of Finance
BOARD/COMMISSION REVIEW:
N/A
BACKGROUND:
In April 2004, the City exercised its home rule authority to establish a one percent (1%) Food and Beverage Tax, which is applied to the purchase of prepared food and beverages sold in restaurants and other establishments throughout Naperville. The City established this tax to fund what is now known as the Special Events and Community Arts (SECA) Grant Program. The SECA Grant Program provides funding for City services to support special events, as well as provide supplemental funding to entities that offer cultural, social, and artistic experiences for residents and visitors of Naperville.
Over time, the Food and Beverage Tax revenue has grown to support other needs, including public safety pensions, the Social Services Grant Program, supplemental support for Naper Settlement, and abating property taxes for debt service.
Revenue generated by the Food and Beverage Tax is allocated for these purposes through a formula established in the Municipal Code. Specifically, paragraph 4.1 of section 3-1-9 states:
"Recovery of the City's costs attributable to the collection of the Food and Beverage Tax shall first be distributed, thereafter, fifty percent (50%) of the taxes collected pursuant to the Food and Beverage Tax imposed herein, up to a maximum of one million nine hundred thousand dollars ($1,900,000.00) a year shall be contributed to the Special Events and Community Arts (SECA) Grant Program which will increase annually beginning in 2019 at the lesser of a two-percent (2%) flat rate or the Chicago-Naperville-Elgin, III.-Ind.-Wis. Consumer Price Index (CPI) rat...
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