The meeting of the Cook County Independent Revenue Forecasting Commission will now come to order.

I will now call the role.

Chair.

Here.

Commissioner Dabala here.

Commissioner Mayerman.

Here.

Commissioner Phelan.

Here.

Chair, you have a quorum.

Good evening, everyone, and welcome to our meeting of the Independent Revenue Forecasting Commission.

And my first is Chair.

It's nice to be here with all of you tonight.

Before reviewing tonight's agenda items, I wish to recognize the hard work and collective efforts of everyone in this room, the Bureau of Finance Team and the dynamic commissioners.

Thank you for everything you do.

Today we're going to discuss some potential recommendations of the IRFC, which will not be finalized until August.

Additionally, we will provide quarterly updates, which include updates on ARPA sustainability.

We are also going to go through some exploratory scenarios, assessing methods to grow existing revenues.

And we can get started with the meeting.

The first item on the agenda is the approval of the minutes from the meeting of June 30th, 2026.

Chair, we need a motion to approve the minutes to proceed.

Is there a motion to approve the minutes?

Yes.

Is there a second?

Okay.

Okay.

The motion to approve has been moved by Commissioner Phelan and second by Commissioner Merriman.

All of those in favor signify by saying yay.

All of those opposed signify by saying nay.

Chair, uh the A's have it.

And I'm sorry, and the meeting minutes will be filed with the Cook County Secretary of the Board.

The next item on the agenda is a presentation from the team covering quarterly updates, the county sales tax, and the preliminary IRFC recommendations.

Thank you, Angela.

So we'll have some updates this evening on some of our deliverables as they relate to the uh principles of the IRC here and recommendations of this body, which we'll get into on the next slide.

So regarding um the impact of um OBA, the OPA provisions on the Health Enterprise Fund.

Uh we recently analyzed the past uh budget from the state.

Uh there wasn't uh a lot of information in there that would change any guidance as far as forecasting goes for the health fund.

So, you know, we'll be continuing to monitor uh any information that comes down to the state continuing to work, uh partner with our friends at the hospital.

Um is that the state is continuing to fund the health benefit for immigrant seniors, their budget, uh, which we have built in.

Uh we have reflected that in our uh June forecast.

Um, ARPA sustainability.

Um the county is currently fine-tuning its allocation strategy for the ARPA reserves, which it had set up a couple years ago.

Um, and then revenue growth options, which we'll dive into on the next couple of slides.

So uh this year, the team we conducted an analysis of county tax revenues, uh identifying reasons for uh slower declining growth in some revenues, understanding uh why they're stagnant, uh, and we shared some updates at the January and April meetings uh on our findings.

Um back to slides here, we'll walk through some uh exploratory scenarios uh what modifications would look like to uh existing taxes in the county's budget.

Okay, so as Angela noted, um we'll be going through some um of the county's revenue sources in this section, uh exploring some scenarios, what different modifications and the estimated revenue impacts would potentially look like, as well as providing some background into our methodologies to estimate these impacts.

Um, and so the first revenue uh here that we looked at is sales tax, seeing what a potential modification would look like uh in the county sales tax.

So the this the county's current sales tax rate is 1.75%.

And so we have a scenario of here of what that would look like if it were to increase a quarter percent to 2%.

Um so to estimate uh what the revenue impact would be from this modification, uh, and we'll also be talking about this the sales tax a bit more uh in the presentation.

Uh, but we use our current sales tax model, which is a regression model that is used to predict the sales tax base.

Uh we adjusted the tax rate to 2% uh effective January 1, 2027, uh, which would be right now the earliest that the county would be able to implement that change uh per per state uh uh uh statute.

Um so this January 1 effective date would mean that the county would begin seeing an impact from the modification in April of 2027, uh, which accounts for the lag from when the state uh who administers the tax for us collects it uh and eventually disperses it to the county.

Uh a key assumption in this modification is no change in the purchasing behavior of consumers uh from this potential rate increase.

Uh and so the projected revenue impact from this modification here uh is that we're estimating uh fiscal year 2027 would be approximately 141 million dollars higher from the from the current uh projection of the the prior forecasts of the sales tax.

Uh, but then the impact would be about 220 to 230 million in 2028 and into the out years.

So this full year impact of 24 million, it's about 14% higher uh than the uh forecaster projections for 2028 and to the out years.

Um the um the sales tax rate is gonna go up, or maybe I think it might have gone up today.

Right.

It uh yeah, yeah.

What used to be the RTA would still be it's it's gonna go up.

Have you do you have any projections about what uh you know that could lower your revenue if it pushes out sales?

Do you have a projection of that?

And then you know, the projection of this would also perhaps be there's an interactive effect.

So I just wonder do we have any idea what that might do.

We haven't explored that yet of what um uh like a surrounding um if that were to increase how that would impact our base and potential sales.

Okay, okay.

Yeah, and then I guess so the 14% difference, 14% increase in revenue.

Is it it's essentially you're essentially assuming it's just linear?

Is it because it's 25% over 1.75 is uh yeah, I'm trying to do the math in my head, but that sounds about right.

That's essentially what you're assuming, right?

Okay, yeah.

Um so I think I think we had some discussions before we you know, we would say that's optimistic, assuming that you know it might cause some drop off in sales.

So it just seems like it should note that.

Yeah, yeah, correct.

Yeah, this seems no um tax avoidance.

That's not that here.

This is just uh no change in the base from consumer behavior.

Is there a way to look at past increases to confirm that or to you know to sort of back that out to have an elasticity there?

Yeah, um we could we could certainly take a look at that.

I'm sure we have data to be able to do that.

I have very few actual instances that we could look at.

So I mean you could do an analysis, but I'm not sure how well there's there's one is the implementation and whether or not it rolls out perfectly, but then you're also only looking at a handful of instances where we would be directly impacted.

confirm that or to you know to sort of back that out to have an elasticity there yeah um we could we could certainly take a look at that i'm sure we have data to be able to do that we have very few actual instances that we could look at so i mean you could do an analysis but i'm not sure how well there's there's one is the implementation and whether or not it rolls out perfectly but then you're also only looking at a handful of instances where we would be directly impacted so you wouldn't have a sample size that would be um great yeah you could make some assumptions I think the the issue is that right now in most of online sales are covered so I think before when there would have been an increase there would have been a bigger opportunity for avoidance because a lot of the goods were still being taxed at the six and a quarter percent whereas now I you've got pretty much everything's being taxed at the how rate so I'd say more of a reduction in consumption rather than any kind of deviation of behavior and going to Wisconsin or North Carolina because that's pretty much tapped.

Back to David's point did you look at the RT estimate and were they what were they assuming in terms of elasticity for their revenue increase um I I did not look at it personally um I think Michael may have unfortunately it's not here but um we I think that might be a healthy conversation to have because that would have been discussed I would think at length at in the state legislature.

Yeah they they cover is that restricted to Cook County or it's a bigger area it's bigger it's a bigger area to I I guess one I just concerned because the the rate is very high in Chicago probably talking the highest rate in the nation and I'm just worried that there's a breaking point that's why I emphasize it.

Well would it be a like what do you mean by breaking point we only just people it affects people's consumption or it causes tax avoidance yeah I I mean I'm really I'm really doing hand waving here but at some point people just say you know this is ridiculous.

I'm gonna make the effort to to go to a different county or do something to avoid the the sales tax it becomes really noticeable when it's yeah and I think you know I think that's worthwhile research in like what opportunities would there be to go to another county to get a lower tax rate because I'm not sure with all these recent changes at the state level odd big of a factor that is anymore.

I mean it used to be like you know we we saw that with gas and cigarettes and whatever but yeah I'm not so sure that it's so I would just see an overall reduction in consumption.

Yeah well I I don't know I mean it's the same effect and I mean I I think the most kind of the most relevant point for policy is just to set you know give it some low upper bound and some lower bound but I think you're really at the upper bound yeah and what's a reasonable lower bound and yeah yeah and it might be significant.

Another way it might not just be that like price goes up that you stop buying it or you look to buy somewhere else but essentially your budget's depleted at some point so you don't buy something else in that way and that way it's not like this constantly gave there's the budget constraint that gets hit at a certain point so you don't end up going after that extra meal or something.

Assume some level of reduced consumption associated with the increase in the sales tax.

Well it's possible I mean you could look at the um I forgot the what people spend their money on the consumer whatever because if it's services are more likely to drop off then it doesn't matter because they're not taxed when I say I don't I'm being flippant it's not gonna affect your sales tax revenue if people reduce their consumption of services but if they're cons if the constraint forces them to reduce their consumption of goods then that's a different equation.

Yeah and it I mean it's helpful to know I think we've we've talked about this a little bit it would be helpful to know really where your sales tax revenue is coming from like what are the what are the big drivers code perspective if you will or the sick codes sick code yeah I don't know yeah I mean now you have data right you actually have data at the the level of the the entity right and maybe you could do some analysis of that to think about like where's the volatility in that and I don't know how much you can find what kinds of things they're selling is it is it like restaurants like I always think of it as cars but it's not cars apparently because the that's handled differently here.

So I don't know what really the components are that's driving sales tax revenue in account.

It's pretty even across all the sick codes that we have, as I recall.

I'd have to look at it, but I'm pretty sure we have uh we have a I think we have an analysis in our rating agency presentations that speaks directly to the um industry codes that are self-reported regarding like the sales tax collection rate.

And one thing that we always say when we present that slide is that you know it's it's pretty um even across all of the different areas.

There's no like in like one particular component that is outweighing like the rest of what the nation seeks.

And that's good.

That's if it's diversified, that's probably makes a perceivation.

Yeah, that's the argument.

So I think the SIC code categorization, and I'm sure you know this is not to be relied upon because it's arbitrary if they don't choose it's supposed to be the top two things that are sold, but it could be anything.

But to David's point, now that you have the data, if there are like some big players, so just looking at them by not by the SIC code, but by their volume, and then I think you're right.

I think there's nothing that really dominates, but just to verify that that's the case, and then you know, use your judgment on what industry or what is I say code or what makes code or whatever they should fall into.

And like it's more like relying on that SIC code data is problematic.

Yeah.

And like we've I recall talking about this to just like internally over like the last couple of years, like we kept that out of presentation for that reason.

Because there's only so much.

Yeah, you don't you don't want to make too many uh judgments from that.

And just self-reported that pretty much.

Yeah.

But um, we have we have started um with having more data now to do things like top 100 in you know, starting to compile that um as something to from a high level.

Um yeah, we we like we can continue to maybe expand upon that and possibly categorize it in different ways, but yeah, you have to be careful.

I mean, like obviously we can report that information publicly, but no, yeah, yeah, yeah.

For internal purposes, we could look at say the top sellers of contributors to the sales tax.

Certainly like the idea of having a bound, right?

Um what could be potential yeah, impacts on elasticity or reduction in consumption are certainly I think that makes a lot of sense to incorporate into our forecast and make a judgment call about what we are incorporating into our estimates using the kind of straight methodology forecast as our fate just to be a little bit more conservative.

Um so the next revenue we looked at is our uh property tax levy.

Um, and specifically how some potential modifications to the property back and would impact the allocation of that levy that goes into the general fund.

Uh so just some background, uh Cook County's property tax revenue comes from a base tax levy uh as well as from expiring TIF districts, expiring incentive incentives as well as um new property construction.

So the county's base property tax levy is approximately 720 million.

That amount has not been adjusted uh dating back to the 1990s, and in addition to that base property tax, the total levy for fiscal year 2026, it included about a hundred million dollars in the property taxes captured from these uh new properties, the expiring TIFF districts, and uh expiring incentives cumulative from previous years.

So after this, I'll call it like a gross levy is calculated.

Portions of that levy are allocated for the purposes covering uh debt service obligations, um uh allocations to the annuity and benefit funds, capital projects, as well as the election fund.

Um a portion of the levy is also allocated, has been allocated uh each year to support uh health the health enterprise funds for their operations, uh and then the remaining amount is is what's allocated into the general fund.

So in fiscal year 2026, approximately approximately 120 million dollars was uh in property tax revenue is allocated uh into the general fund.

Uh so one uh scenario we explored is um adjusting the base levy that's 720 million, um, increasing the base to keep pace with inflation starting in 2027 and into the out years.

Uh we utilized uh Moody's baseline CPI forecast uh for the Chicago metropolitan statistical area.

Um while it was not a factor in our projections, we also would have assumed a cap on the annual inflation, so that an increase in the base levy would not pass three percent uh in any given year.

Um the revenue impact of the general fund would be about 20 million dollars of additional uh property tax revenue allocated into the general fund in 2027.

That's about uh 17% greater for the amount we had were projecting for 2027 before this, and as you could see uh that amount increases in 2028 uh and into the out years um as the the base would increase with inflation.

Uh and then a second scenario we explored is um a one-time adjustment to the total gross levy retroactive to 2020.

So increasing the base levy as well as the levy coming from these expiring incentives, TIFS, um, and new properties, if they had both grown annually with inflation dating back to 2020.

So the revenue impact of the general funds from this one-time adjustment would be about 170 million dollars um in uh fiscal year 2027 and into the out years uh since it would be just uh in the scenario one-time increase.

And so we utilized uh CPI uh for all our urban consumers for the BLS uh to come up with these estimates for the the second uh scenario here.

All right, Missy, can you say when the last time the base levy was adjusted?

Just curious.

Um I think it was 1996.

Yeah, so nominally it's been flat, but I guess you think of it as like real, it's been uh hasn't kept up.

So that's almost a 24% increase.

Yeah.

I suggested when when we met before when you brief me on this that one other way to think about it would be thinking about keeping the tax rate rather than the gross amount constant.

Uh which you you know, you could pick whatever year's tax rate you want.

The tax rates obviously been falling because the base is going up and the stop.

So it's sort of it's sort of like keeping the tax rate constant.

It's almost like saying the property tax burden at least per dollar of real estate wealth is not going up.

So incorporated that is by the addition of new property.

The additional expiring TIFFs and expiring um incentives.

So we try to capture that natural growth in the tax base whenever we issue whenever we've developed the levy.

We started doing that, I think in I don't remember the exact date, but it was probably about seven years ago.

But yeah.

Is that is that kind of I think that's kind of one way of doing it.

But like I think what you were you were suggesting is like what did we add?

What if we knew the assessed value beforehand, right?

And then backed into our total property tax levy based on that.

And I don't think we would know that until unless we looked retroactively.

Well, I mean, you could look at what the rate was.

You know the rate's been going down.

And so suppose the rate has gone down by eight percent.

Yeah, but then if you raise the levy by eight percent, you sort of get to the same place.

I mean, you could do something on this lines.

Yeah, I don't know that it's necessarily better than this.

It's just it's kind of like intuitively the way I I would think about it.

That's kind of what you're doing with the sales tax.

I guess what's the sales tax?

You're adjusting the rate, I guess, with the sales tax.

Yeah.

All right.

Since we're all jump in.

Um this slide, we'll go over uh amusement tax where we created two different proposals to address the uh revenue growth.

Um to give some context.

Currently, amusement tax is administered by a three-tier system uh with rates set at 1%, 1.5, and 3% for each tier.

Now the first proposal is pretty straightforward where we uh suggest the flat rate across all tiers at 3%.

Um this adjustment would only be an increase to tiers one and two, both of those would now go to three percent, while tier three would remain unchanged.

Um, the methodology here was using our um historical revenue data to calculate the tax base for all tiers, then apply that new rate to each tier.

And at the bottom, we can see the projections for proposal one as roughly 15 to 16 um million a year and additional revenue for proposal two.

We incorporate a tier structure and the addition of streaming with the tax base.

Uh we saw a lot of opportunity here.

Um, as we see the city of Chicago already implements implements a streaming tax.

So our department of revenue conducted an analysis of city's revenue from streaming.

Uh, we incorporated those estimates into the county forecast um for amusement in the out years, and for streaming alone, that would bring in 33 million annually for the breakdown of the tier restructure.

Um, this is shown in the methodology section.

Um the addressments were drafted to be consistent with the city's amusement ordinance language.

Um this means tier one would now be exempt.

Tier two and three are both taxed at um the flat rate of three percent.

Um for tiers one and two, the criteria changed, and uh 60% of tier one would be uh reclassified reclassified and elevated to tier two, ultimately increasing that tier two base.

Um and with the both of these changes, the tier restructure and the streaming, uh, we could see the total impact of proposal two is around 45 million dollars in additional revenue.

And the streaming is taxed at three percent.

Is that right?

So we when we did the analysis on the city of Chicago, they tax at 10%.

So they tax at 10.25, I think it is.

So uh our estimate right here will probably be along those levels just for the streaming, though.

Oh Tina is Tina's jumped in, yeah.

Tina, go ahead.

I believe that this um reflects a tax rate of three percent um on the taxable base that we um assessed from the city's records from their data.

The proposal should be that the tax is the same rate.

Three percent.

Yeah, three percent.

You're adding streaming to your base, I think.

Yes, yes, okay.

Thanks, Tina.

You're welcome.

I guess that I also wonder about white from screen.

I don't know how easy that is to do.

Register at a different uh different address, it's not being text or something.

I guess Chicago.

City of Chicago will find out.

Yeah.

You would think this would be more elastic too, then in terms of like projections again, you're sort of assuming that there's no change in pattern, but you know, you can get entertainment in different ways or amusement or whatever.

So this might be this might be more um more elastic, basically.

Uh Chicago's hit it with a ten percent tax, then you're adding to that.

So people are gonna feel like that.

Yeah, elasticity would be where we would eat it.

Password.

Yeah, okay.

But you can you could still create a VP.

I mean, like you could you could avoid these taxes.

Yeah.

I I I don't know, I don't know if there's a literature on it at all.

But anyway, again, it's probably just to say this is a very optimistic effort.

Yeah.

And I think with some of the consumption things that I mentioned before, obviously there'd be interactive effects, you know, so like these are estimates in isolation of an individual tax, but if three of them were implemented, then some of those things might come to bite a little bit more.

Yeah, we'll go and here we have gambling machine tax.

Uh for gambling machine tax, we administer emblems for public gaming machines.

Uh we thought the opportunity here was to increase the cost of video gaming terminals, also called VGTs.

Um the cost of these emblems from 200 to 500.

Um VGTs are just gaming terminals, uh, but these are ones usually found in uh mom and pop stores, uh not casinos.

We have a different uh category for casino video game channels.

Um our methodology consisted of uh using our 2025 revenue data to find the number of emblems issued and apply that new rate.

Uh the resulting percentage increase was then applied to the forecast to project the out years and we can see this will roughly create uh three million in annual impact.

Hello, um if anyone on the call can verify that they can hear me, that would be great.

Loud and clear.

I have a thumbs up, and can you see my presentation?

Yes.

Yes, I got a yes.

So okay, it's not gonna share to the screen, but we're sharing in the meeting.

Is that acceptable?

Are you recording?

Actually, okay, and then I think we can just look at our printed out copy.

So we're currently still on gambling machine tax.

Um and then if anyone on the call like it cuts out, please feel free to to jump in and notify us.

Um gambling machine tax.

I think David finished and concluded the slide.

If there's any commentary to let us know now.

Otherwise, we'll move on to the next slide.

Um market like I was good.

Um I don't know if that's more so impacting the VGTs as it's more because we also have a sports wagering tax.

That has been um that has been more volatile.

So it's it's been hard to parse out um how those prediction market apps um, I guess you could say have been impacting because it is the sports wagering tax still uh relatively new county.

But for the the VGT revenue is really driven by um the amount of establishments and combinations they have.

The most you could have is six terminals in your establishments.

And uh so we'll look at the game the game boards reports of the public see how that's been uh as far as like the establishments and usually all establishments max out.

I think there's about forty five of them in the counties.

Um that you have these terminals.

Um it has been incre uh haven't seen bigger revenues over the last couple of years.

Um I think it's more so just uh where's the ceiling with the number of establishments.

Um so we tried to forecast that reconsider that one.

Yeah.

them in the counties um that you have these these terminals um it has been or having figurable revenues over the last couple of years um so i think it's more so just the where's the ceiling with the number of establishments um so we've tried to forecast that reconsider that one yeah should move ask okay moving on to alcoholic beverage tax so the alcoholic beverage tax is currently structured as a hybrid tax with uh flat per gallon rate taxes on beer and liquor and rates dependent on alcohol by volume for wine and similar products um as seen in the uh table just below so the revenue growth proposal here would be to increase all rates by applying the cumulative inflation since the rates were last increased which was in 2012 um and that would be a 41% increase which was then applied to the rates um in terms of methodology we apply the new rates to the 2025 tax base is that's the last year of complete data that we have for each tier um and then this calculated the revenues that would have been generated at these new rates and then we calculated the additional revenues for these out years and the forecast by applying this percentage increase to our baseline forecast um so for FY27 we would generate approximately 14.8 million while the out years were anticipating an additional 14.5 and this dip accounts for the dip in trends of alcohol consumption um and there's we're forecasting a trend in reduced alcohol consumption and the increases are per gallon uh not all of them so beer and liquor are per gallon rates so it's a no but like it if you say 34 cents yeah what's the 30 four cents for what um is that per ounce was that oh it is per that would be per gallon but okay yes okay but based on on volume of what's in the liquor these really just surprised and I mean this is what you do now too but it really jacks up 18 above 20 percent so that's I guess that's that's really more the era that talking about maybe it's one over that yeah so it's a lot higher yeah so we talked about changes in alcohol consumption and them here in the people were built in wine consumption beer consumption mixed drinks marijuana that's substitute effects I don't know if we're doing the marijuana consumption trade-off is incorporated department of revenue can speak to that I don't know if Tina wants to jump in but this is because so this is showing a one time reduction in revenue going from 27 to 20 and then constant threat the rest of the period does that yeah I believe so I believe reasonable based on previous trends before tax increase I mean isn't this a just a source that is declining over time yeah we have seen it um declining in the last couple of years I think against our um June forecast we had really forecasted now is as flat um I think that's why this probably showing it um that's just the same year over year amount um Tina I noticed you unmuted did you want to add to that I heard you say something about the I didn't hear the question I heard something about marijuana and department of revenue and so I didn't know if you wanted me to speak on the okay thank you okay we're gonna do this thank you Ted and I know we've encountered that before uh Ted let me know Wi-Fi's back up so we're gonna try it better this I know sorry for all the the pivots thanks for everyone's flexibility um Tina wanted Tina do you want to jump in now maybe we can hear you um can you hear me yes we can great so I said I did not know if you wanted me I heard I couldn't hear the question I heard marijuana and I heard department of revenue and I don't I didn't really hear what the question was so I don't know if you wanted me to weigh in on anything uh I think the relevant thing is why is the projection of revenue increase for alcohol consumption is decline so it has been declining overall um

I heard marijuana and I heard Department of Revenue, and I don't I didn't really hear what the question was.

So I don't know if you wanted me to weigh in on anything.

Uh I think the relevant thing is why is the projection of revenue increase for alcohol consumption is decline.

So it has been declining overall in the last few years.

Um I did not do these projections, but um we did look at the individual categories um in this and beer continues to decline um each year.

Um hard liquor is actually um it spiked after COVID in 2021, and then that it's been kind of volatile since then.

Um, and wine and which is like the generally the category um under 14% is wine.

Um and then 14 to 20 percent, those have been pretty stable.

So um if beer were is the main component that continues to decline.

I think that it should remain relatively stable.

I mean I'm not sure if it's how long beer will continue to decline.

So I'm not sure what the I'm sorry, uh wasn't a very good answer, but I'm not sure what the um thought process behind the leaving it flat for the outlying years, unless maybe someone assumed it was going to just level off at some point.

Yeah, I think I I um I think that was the thinking in past uh iterations of the forecasts is that there would be some bottoming out of that that you know uh beer wouldn't just continue to decline in perpetuity.

Um I think that was I think that was the main reason why.

Hope that's true.

Tina just asked a question.

So you said wine is trending stable, but you see some volatility in what was the other category?

Liquor hard liquor above 20%.

So I think everyone was doing shots after COVID.

Uh a lot of shots, and then it kind of went down back up a little bit.

And so it's hard to say where that will go.

That category.

So I guess just to be clear, just so you have looked into the longer term forecast, like I'm particularly familiar with wine, and uh it's my understanding that the trend is downwards, but the expectation that that will continue because younger people aren't drinking as much as older people.

I don't know what percent of the revenue source wine makes up of these three categories, and I don't I'm not familiar with the trends in beer or hard liquor.

So I'm just wondering can we make sure that we look to the market forecast for these things and make sure that this this trend seems reasonable for the revenue forecast?

Yeah, I think we can uh work uh revenue to refine this and see what the yeah breakdown is as far as these different categories.

Um with our question, I will go on to the next slide, which is our proposal for other tobacco products.

So the revenue growth option that we explored for the other tobacco products tax is a two-part proposal.

Um first we are proposing an adjustment to expand the definition of products subject to the other tobacco products tax, so that it would now include absorbable nicotine.

Um, this would include new nicotine products and product lines, such as nicotine pouches that are not currently captured in the county's tax base.

Um state of Illinois and other states have already expanded their definitions to include these products.

The second part of this proposal would revise the definition of consumable products, subject to the other tobacco products tax, and this would clarify the ordinance language to include all vapor products regardless of nicotine content.

Um, and to ensure that the county tax is capturing all the products on the market, regardless of nicotine content.

As far as methodology for both of these, uh we were reliant on our department of revenues preliminary estimates estimates, which they performed um by sampling invoices to estimate the total number of these products ordered from Put County retail tobacco dealers for both types of products.

Um our proposal currently assumes a five cent per unit tax on the absorbable nicotine products and a 20 cent tax per milliliter on vapor products regardless of nicotine content.

Um both of our estimates assume a conservative compliance rate of 25%, which would generate additional revenue of 1.1 million for each of these parts of the proposal.

So total, it would be approximately 2.2 million um dollars worth of additional revenue per year.

So um I guess uh where did the compliance rate of 25% come from?

That came from our department of revenue.

Um I don't know if that's their history with again if Tina wants to jump in.

They gave us 25% rate of compliance and a 50% rate of compliance.

Um it's really uh local bad.

Yeah, we understand.

So I don't know if that's typically the trend with incorporating new taxes or new rates or expanding the base.

So if I see Tina unmuted, so if you want to jump in there.

Um so it is our experience with this type of product, not taxes in general, but these vape and um and nicotine products that they're selling um at these convenience stores and and those types of stores that um they tend to they tend to sell products that maybe they get from non-compliant wholesalers.

Um, and so we're we're it's a consistent um a continuous effort to um inspect these businesses and and you know, we issue a lot of um citations to them, but so it 25% is just a pretty um, especially over you know, in the first couple of years, um, it's it's a conservative estimate.

And do you think are the compliance rates that low for the tax tobacco products too?

No, tobacco products.

Well, I mean, we do issue we do find a lot of illegal cigarettes out there, but yeah, um, it's it's definitely not as it's these products are harder to police.

Um you know, they get a lot.

It's we work with the state of Illinois and the city of Chicago, and you know, we go to um like these conferences, and um there's just a lot of contraband, or I guess you could say that you know they get from other countries, and um yeah, it's you know, and and with cigarettes, we can it's it seems like there's not as much um non-compliance with cigarettes.

These these seems yeah, no, but with cigarettes really there's I know a lot about cigarette stuff.

Cigarettes, it's a very it's not so easy to sell cigarettes illegally without tax snapshot.

It's it's pretty easy to catch people.

There's a lot of regulation to catch people.

Um, but uh I guess I'm wondering about the vape.

Anyway, it's I don't want to go too deeply in this because it's not that much money, but I I mean that it seems to me, I'll just I'll just say it seems terrible policy to be taxing non-tobacco products the same as tobacco products, except if we don't really know which is which, maybe it's not so terrible policy.

I mean it's you know, we we're taxing tobacco for a reason.

So we don't want to tax vape products that don't have nicotine.

But on the other hand, if there's a lot of non-compliance, maybe the ones that say they don't have nicotine do have nicotine.

So I don't, I don't think Frank's on the call, but uh Frank and the Department of Revenue um explained to me too that there's it's kind of like a threshold before you have to list on the product that it does have nicotine.

Uh so there might be some products that do have nicotine in them, but because they don't surpass a certain um uh threshold, um, they they kind of can get away with not having to list it, and I think therefore get captured in this tax.

Okay.

Oh, Tina, did you have anything to add?

No, I don't think so.

Okay, thank you so much.

Um moving on to the next slide, then so this is just an update for back in 2024.

The county established the ARPA sustainability reserve, and the idea of that was to carve a stair step into our fiscal cliff uh associated with the end of the American Rescue Act Rescue Plan.

Um, we knew that the county would not be able to continue to provide funding for all of the ARPA programs.

We had about 72 different programs.

Um the reserve was created for the stated purpose of reducing the amount allocated from it each year between 2027 and 2029.

Um, in order to establish which programs we would sustain, we engaged in community uh surveys and and hyper-local conversations.

And as a result of those conversations and with uh coordination within the office of the president about which programs we could we could uh sustain in perpetuity.

Um we were able to identify these 12 programs that you see on the right, and we will be sustaining those programs with funding as identified uh in that table.

And FY 2027 will be the first year that we use the American Rescue Plan Act reserved to sustain some of our programs, and we'll be allocating 52.75.6 million dollars.

Um next slide in 2028, we will need to start addressing the expected gaps between these estimated costs and the ARPA reserves.

At this point, we have a total projected gap of about four to three million dollars between 2028 and 2030.

And we'll be working closely with the department to develop gap reduction strategies that include uh seeking to identify external funds from philanthropy and other external sources where we can, generating revenues from the programs themselves of possible, and leveraging county funds or scaling down uh initiatives when necessary, all with the goal of sustaining these programs into the future, uh, which we believe we can do.

Any questions on that slide is for 2030.

The identified gap is 23.3.

Correct.

But the total is 20 on the previous slide.

That's correct.

So we have 20 million dollars in funding and 23.3 million dollars in gap.

About 50 23, so 43 million dollars in taxes.

So it's the blue is just funded in the debt.

So 20 million dollars funded, at least aren't just so many different allocations of the V sources.

If you wanted to kind of get a sense of what the cost would be, you could look at that 2027 table, and that's pretty consistent across the across those years.

We used some reduction in some of the program costs layout years, and we see some increases of what the projected costs are, but those are gonna change over time.

So as we get closer to them, we might find that rate cost of not as high or not as low as they're so I think now at this point, right?

We've incorporated those additional expenses into our um long-term financial forecasts.

And so we look at the tail end of our alligator slide as we're like the pollock, but see that you know part of the mouth incorporated stuff.

cost of not as high or not as low as there so I think now at this point right we've incorporated those additional expenses into our um long term financial forecast until we look at the tail end of our alligator slide as we're like the pollute see that part of the mouth incorporated stuff of the program okay okay so um those are just some of the orderly updates uh next we're gonna take a look at our sales tax um so I'm going to run through just how our projections of the sales tax has changed um over the like the last year and a half um how we think legislative changes what we're seeing have impacted uh especially in 2025 and 2026 um and whether or not we can expect to see uh the recent high year over year growth in the county sales tax if that will continue into future years um so on the next slide here um this is just some of the major legislation uh that was enacted which has impacted a lot of the counties uh collection a lot of local governments collections in the state um i'll really focus on second and third pieces here public act 10131 which is the leveling the playing field act um so this altered this the um retailer occupation tax to be from a uh origin based sales tax to like destination based sales tax so uh there are many many of most businesses out of state were paying some kind of revenue to the state of Illinois but legislation the the legislation that went into effect here changed the way that the the sales were taxed so uh a lot of these businesses were just remitting uh use tax and so they wouldn't have to pay locally imposed taxes so uh the leveling the playing field act changed that so that out of state sellers would then remit um the locally imposed uh taxes and then in uh enacted in 2025 uh january uh there was a uh a change where we saw uh an inclusion of out of state sellers that have some kind of physical presence in illinois uh so for example a company that has a rep or sales office in illinois but shipping products to customers from a warehouse that was outside of the state uh they used to just pay maybe like the use tax rate for the state of six and a quarter uh bypassing the local rates they would now be captured uh and also pay locally imposed sales taxes so these are two major drivers over the last five years that have impacted uh favorably the county's uh sales tax collections and so on the the next slide here uh we wanted to take a look at counties sales tax or portion of the county sales tax versus the state's uh gross sales tax that goes into their general fund um so there's uh what's referred to as PL or permanent location um there's a part of the county sales tax that gets categorized as this and this is per the state's uh website um uh from retail sales from a permanent location within the taxing jurisdiction so think of more like brick and mortar stores and if you look on the chart here um you know the the volume of of revenue is obviously quite different but we wanted to show just in a way of how we think the the state's uh gross sales tax and our PL uh tax revenue has been relatively you know close and trending um over the past five years uh but then on the on the next slide we have here including the CL taxpayers which is the changing location um from payers who have no permanent place of business within the taxing jurisdiction uh but they do conduct intermittent retail sales within the jurisdiction so you could see from um uh 2021 here this revenue has been uh trending higher over time um this is what we think is from what we understand is the um the impacts revenue from the recently enacted legislation um and so in 2025 you can see it it really jumps up um and has continued to 2026 uh this slide here we're looking at the CL taxpayers um so the data that we get from the state we've been seeing pretty steep increases in these uh CL taxpayers um especially in January starting in January of 2025 when public act um 103 uh 893 went into effect um so you could see uh from a not

Uh this slide here, we're looking quickly the CL taxpayers.

Um so the data that we get from the state, we've been seeing pretty steep increases in these uh CL taxpayers, um, especially in January starting in January of 2025 when public acts um 103 uh 893 went into effect.

Um so you could see uh from a nominal standpoint chart on the left, uh quite a jump, almost doubling the um average monthly revenue, and we're also seeing increases in 2026, and then on the the chart on the right here, this is the the CLs as a proportion of the total county sales tax.

So uh, you know, prior to 2025, this CL revenue made up about 15 to 20 percent of the county sales tax.

Uh we've seen that really jump up in 2025 uh and continuing to uh increase in in this uh latest fiscal year, where it's now in the range of 30 to 35 percent.

Can I ask a question?

So I guess we should there's the sort of this delayed response to the legislation.

I guess the thinking is that there was just so much of this had these sort of in-state presence that it wasn't didn't really bite until the law was passed.

Is that kind of how we should think about this?

Well, I think you could think of it as like the second legislation in 2025.

It just it's it's like expanded the base, sort of betting this the local sales tax.

Um, there was all these payers who were paying, they were paying like state tax, but they weren't paying because of like the definition.

Um all these locally imposed taxes.

So they were there, and now we're like captured in the last two years.

Legislation was for it.

But they were capturing what was the modification of the whole thing for 2026?

That was to include uh servicemen servicemen, yeah.

That's right.

Um so the I think the initial estimates that we had for the servicemen was pretty minimal.

I think it was about $8 million annual.

Um, I think if we get a couple more months of data, we could try to see if that is true, or if there's maybe this is still like compliance from the previous year.

Um so we'll have to keep, you know, when we pull the reports, we're able to kind of get a little more and see if there's new new businesses that come on in the in these uh in these downloads from the state.

So is this suggesting to me um that the impact of the 2021 legislation was much smaller than the 2025?

Yes.

Have you talked to the Illinois Department of Revenue about that?

Um I'm worried that there may be a changing definition of CL and PL because I know for sure 100% the 25 legislation was to fix unanticipated consequences of the major legislation, which was passed in 2021.

So I'm not familiar with these codes and what's fallen into them over time.

Yeah, the CL, but the the big it's my understanding that the real big change came in 2021 and everything since then has been cleaning up unanticipated consequences in the 2021 legislation.

Okay, yeah, we we we could reach out to the state to see if we can so then if that's the case, what explains the jump in revenue, the recent jump in revenue for the county as a whole for the county.

I think we we need to know more about the definition because I I'm thinking this is this is good, but the definition has changed so much that orange isn't comparable to no uh so like I think I think orange was much bigger than it is using this definition of CL.

I think the definition of CL has changed over time or how it's being used on that form.

So yeah, I can understand that.

Yeah, and you need to um businesses that were submitted as like like PLs are now being I I'm not familiar with the PL and CL, but what I do know is that 2021 tried to change a situation as follows.

Amazon had a wear house in Indiana.

Yep.

And it was being shipped to Chicago.

And because it was out of state, the tax rate was lower than if it was in Juliet and shipped to Chicago.

So some high before 2021, the Juliet Distribution Center was picking up a higher tax rate than the based on product.

I mean, that's how Amazon have their stuff in more highs, and so it was really really complicated.

But I don't know enough to say anyone that because I but I'm just confused, could it was it's always been my understanding that the 2021 legislation was the big change and all this other stuff is at the margin, yeah.

Yeah, and I mean I could be wrong, but that's that's what I've at least worked for.

Yeah, I think that's like that's what I was sort of asking for.

It seems like there was a gaming that went on because of this sort of rule, like if you had some in-state presence or something, right?

Maybe and if it was big retailers if it's the Amazons of the world where most people are buying their online stuff, right?

There could be some element of that.

And so expanding the legislation then.

I think really, and I'm not entirely sure.

Like I think if it says there's changing location and temporary location, I don't know how accurately they maintain those codes, but we've kind of come to the determination that it does represent in some fashion or another the online sales that are being captured.

Um so I think, right?

Like I don't know why the difficulty why don't they just call it online and because a vendor doesn't submit their tax return and say I got this amount of sales from an online customer and I got this amount to seal from somebody who walked in the door.

I mean, there was tons of online sales that were being captured before 2021.

Yeah, that's right.

I mean, the 2021 was to pick up wasn't being captured and what was being captured at the state rate, but not the local rate.

Yeah.

So it it's just it's a lot more complicated.

And think of the intent, it's it's a tax return.

You know, it's not like your survey and marshall fields, and like, you know, where did your customers come from and what's shopped at the bottom in and did you mail it to them?

You know, it's and well, we have historically no one go online sales were being captured before 2020.

Most of them are again.

This is all just small potatoes compared to what was already being collected, except for local tax rate.

I think we've got this surge in revenue that we're seeing.

Yeah.

So there's gotta be something that explains that right.

So so some of these came on, yeah, yeah, because of the tax, the tax now became applied to them.

Yeah.

Right.

But we're we're starting so and then you go back.

So it would have been 2020 compared 2020 compared to 2021, and we talked about this on the phone.

Then 2020 was so messed up because of COVID.

Yeah, like so.

We don't know what how how big of that jump was before 2021.

And the data's not clean to really go back and I mean I every time you do a different kind of this analysis, it improves.

And the more data you get, the more data, you know, the more it proves, and the more we understand.

And I just I think we're still but you're right to tell us even though this this seems like a nice clean story, but it probably isn't.

It's probably more complicated than this.

To me, this seemed I thought, okay, well, this explains it.

That makes it all make sense.

Yeah, but maybe it's more complicated than that.

Yeah, this is a nice explanation, right?

I mean, you're showing okay that things were stable, it followed the general pattern with the PLs, right?

The growth is in the CLs.

Yeah.

And one question I have is, you know, are we done with the growth in the CLs?

It kind of jumping ahead a slide here.

Yeah.

But it looks like we've maybe hit that plateau, but um, but yeah, but that that's it does seem that that's where the growth's coming from.

It's well documented.

Some cool figures.

Yeah, yeah.

So yeah, it's you know, the slide here really shows as far as like the annual change and the monthly revenues for the you know, you could see the CLs as compared to the allocation and also how that looks on the state level too.

Um, you know, our PL in the state is you know, tracking pretty close.

Um, but yeah, it's just the explosion in 2025 of that legislation.

Um then you know, we think that's moderating now.

And this is like what we know, once as far as like uh getting our forecasts right and like our dummy variable which we have for our model, um, not assuming that there's going to be a continuation of growth from the legislation, uh making sure that that does is reflected in the model because yeah, we're not expecting this to grow up in perpetuity in each year.

One way, by the way, if you go back in the slide to maybe try and think about whether there's any room to run, is that you're getting 35% in the last few months out somewhere like 30, 35 percent of your revenue from the CL.

So like trying to compare that with like what share of retail sales are online versus in person, like that should be a statistic that's out there and the two should line up, right?

So if it is about 35% of sales, then then you know you sort of run your course here, but if it's 40, maybe there's a little bit more, or there's some people that are still out there not paying.

Yeah, so could you go back and see if somebody was at CL at one point then became a PI could say just I've caught where there's been one month where there's been months of the business being categorized as the PL and then they change to the next one to be a CL, but then it seems like it could switch back.

It was kind of like a one-off, like maybe uh an error the way that it was entered.

That doesn't seem to happen too often though.

It's more so observing more CLs coming online uh with each disbursement.

Okay, but not not so much um you know, switching between the two categories categories.

Um there are like businesses too where they'll they'll have PL lines, but then they'll they'll have a C L line to come on at some point, and it seems like um you know, there's just like another part of like I said, the way that they're submitting it or being classified.

So there'll be two for one for the business of the C L and TL that is that we've seen as well, but not so much of like operating on being categorized as one and then switching to the other um into the uh into the outlands.

So what do you get from the state?

Do you so like when these businesses were just pan the new slides?

Were you getting any information from them?

Uh well, I think well, we've only been getting this data for like the last I think maybe two and a half three years.

Um so before that we weren't really getting any that's that's meaning but would you have got even in the last two or four years before 2025?

Would on the file you get from the state, you would just be getting businesses that had the anti retailer on just the retailer.

So if they were paying the use tax, they would never they wouldn't show up on a file for you.

No, even though you were getting a distribution from the use tax small as it may be, like from the government government portion.

But you don't have any transparency on whether they were new businesses, or they were paying use tax all of a sudden they just come on a file.

We we've made assumptions over the last couple because um the way that we when we talk to the state, we asked like how could we tell what are the new what are the new revenues from the legislation?

And we were informed that you should track the CLs and like the essentially the new businesses that come online in a month is probably related to the most recently enacted a legislation.

So we we would track to see each month when we pull if there's like a new business and account code, if it's under CL, then we could kind of tag that as being uh an actual legislation.

Is it possible the way the question was asked and how it was answered that the CL, some of them were paying a use tax, but they're new to you.

So you're being told pull all the CLs.

Yeah, but that doesn't mean that they were never paying tax tax.

Yeah, yeah.

Because I you know I'm a bit troubled by this impact of 2025 because it shouldn't be that large compared to 2021.

But if there's if a whole bunch of new companies are showing up in your file because they're paying county tax, not because they're all of a sudden paying tax, that they were always paying the use tax, they just now fall into your bucket.

So I might so I guess part of that conversation is like when we that the language matters, like online taxes.

When we use the term online sales, the taxes were being paid, they just weren't being paid at the higher rate for the county to get.

And I think that that I mean that that distinction is is really important.

Yeah.

Because real because that's again going back to that.

The intent of the legislation was to allow the local taxes, whatever it was in cook, whatever it was in Chicago, to be aligned to be collected on sales.

Because up until that point, there was no legal authority to collect anything more than six and a quarter.

Yeah.

Yeah, I think we should definitely reach back out to ramble.

Yeah.

I have a question.

So I think it would be helpful for me to honestly give me an example of what you would consider a CL.

Is that more the pop-up phenomenon that we're seeing?

The companies organizations are coming in, they're standing up temporary uh pop-up locations, and they're off to the next state.

This is more like like marketplace facilitators.

Okay.

So like big online platform.

Um yeah, like your Amazons.

Yeah.

Okay.

Yeah.

So it's strange to call them CLs, right?

Because that's not really what's going on.

Yeah, it's not that they're changing their location.

That's why I asked the question because I'm thinking it's more there's a growth in the pop-up type thing is happening specifically in Chicago.

I'm thinking, is that a driver?

But you're saying that's not the audience.

Yeah.

Okay.

I think like what we're trying to highlight here is that the detail that we get the state, the part isn't exactly conducive for performing uh in-depth analysis on you know how much of our online, all of our sales tax is related to online sales.

What we have available to us are in the most root, like finest level of detail that is provided to us, are three types of categorizations EL, CL, and TL.

And none of them are very well defined.

So we're using the best data that we can in order to identify the information and and and estimate what the components of the legislation are doing here.

And I think they they've done a really good job of putting that information together and selling a pretty uh compelling story about you know how the legislation has impacted those categories.

Now, whether or not those categories are accurate, whether those categories are of a good representation of what online sales are.

I don't think we can speak to that question, but we can say that you know, ostensibly, right?

That that the legislation has had a pretty significant impact on the CL tax poiers we have largely attributed to online retailers.

Yeah, so the CLs are a subset of online retailers, and I think it's probably first that you should talk to, or I can't talk to some auditors that work in the but I think there's very little proposed legislation out there to close any more gaps, loopholes, you know, whatever.

So I think this last push is gonna like I think there was one thing that didn't pass, something marginal.

Um but so I think now I sales in could county that are being delivered.

Um are taxed at the county tax rate.

I think you'd be hard pressed to find something that's not, which goes back to like the analysis of the sales tax that you were like avoidance.

I I'm not sure that you there's a way to avoid paying that sales tax anymore because I mean if people you just don't have enough money to buy, you know, you have to trade off about what you're gonna buy.

Yeah, go back to forecasting what the economy is gonna do instead of the technical legislation that would be nice.

On this next slide here, it's a uh we have like a breakout of just you know this CLs, the PLs, uh, the portable cook uh sales tax, um, looking at like six month uh like trenches and seeing the year over year changes.

Um you know, to us what sticks out on this is the CLs, you can see um how much significantly higher the year the year over year um sales have been as compared to the state, the PL, um the PL for the Cook County.

Yeah, but uh, you know, we don't when we put this together, we were using uh January through April data for 2026, uh, all the way on the right there.

And so you could really see the the CL coming down as we think that's starting to moderate, at least coming closer to what it was uh before 2025.

Is it fair to say that this has given us some insight into like the impact of inflation versus something else because the growth has not been very significant in the PLs compared to what inflation oh, but it's gone up again and uh in 2026, yeah.

So um so it could still continue to grow there a little bit faster.

Yeah, I mean, I think you would I think we would all agree that e-commerce sales are growing in a faster place than physical location sales, right?

So I think what you're seeing is you know, that's somewhat reflected in this information, but also the change in legislation.

So on this next slide here, we're highlighting how the uh the annual sales tax projections that we produce have changed over time, uh, going back to April of last year.

Um and so you know, just following the colors of the rainbow here, you could see that our forecast has um in 2025, they were pretty close together in the out years, but for 2026 and for 2025, they were gradually increasing.

Um and then in the more recent uh sales tax forecast uh for April and June, you could see that the base in the near term um of what we're what we're projecting has really increased as the 2025 and 2026 collections have just been much higher than we were projecting prior.

Um, but if you uh look at the uh the out years here in the table below, you could see the the year over year changes in 2028 through 2030.

Uh, you know, it's pretty conservative.

Um, you know, right around two percent.

Um it's more so in 2026 that we've seen such a high increase in the year over year projections, and that's what's been our uh forecast for the sales tax of the out years.

Uh and then the next slide is just the same thing, it's more of a monthly look at this though.

Um, along with uh some black dots here showing the actuals.

Uh and so you could see in uh the left side of this of this uh line chart, the actuals have been higher than what we were projecting over time when we were producing earlier forecasts.

Um and so that's what's guess we got more data and collections, uh, what was driving the more recent uh forecast of the sales tax for the out years, but for the out years, you know, the the projections kind of uh follow a similar trend.

It's just that the base has been higher as a result of more favorable uh remittances.

Uh and then on this last slide here, uh, we wanted to just show some of the recent outputs from our regression model.

Um, you know, one reason why just showing what are some of the different um coefficients ingredients that go into the model.

Um, you know, we factor in uh months, the seasonality.

Um we include a dummy a dummy variable, which we uh update each time you run the forecast, um, trying to adjust for the recent legislation so as so that it does not uh assume that we'll see growth into the out years.

Um, and then the we have the different economic indicators that we've used uh going back to April of last year, uh, which we use retail sales uh for the Chicago MSA as well as number of employed persons and number of households, uh, both in the MSA to set the uh macroeconomic floor.

And so you know our model here as far as the adjusted R squared shows that about 96% of the movement in the base is um reflected from the coefficients here.

So I I did I'm sorry, well, I was just gonna say I we talked about this a bit in the briefing.

I I just think there's a lot to dig into here, and I I'm gonna suggest that this I'm gonna withhold my comments, but except the request that we kind of explore discuss it because to discuss.

It is a lot discussed, and I was gonna just this is something I kind of asked for, so I thought I'd comment on a little bit.

One thing that it is that the coefficients are quite stable in each of the different forecasts, and that's that's a good thing that that applies that like the model was like fundamentally changing, but the underlying factors were right.

So, in terms of thinking about all of these things, there are sort of these one-off and slight jumps.

Um, but it is remarkably stable.

Um another way to sort of see that actually would be to if you go up a couple of slides back a couple of slides there.

So if you look at the rainbow chart here, which is very cool, but the the slopes of the lines in the out years are basically all the same, right?

So essentially in all of your forecasts, you were predicting this as like a one time jump, right?

In each time, each updated forecast, that one time jump got a little bit bigger, but the slopes in all those out years are basically all the same.

And so it's sort of saying all along your model was focused as this one time thing, and it still is, and so that's that's and then the stability of the coefficients are sort of telling you that as well.

Yeah, to your point about for one period where there was some instability, that was I think definitely in April.

With if you look at like the households there, that seems to jump up or jump down, I guess, uh, before kind of perverting back to closer to where it was before, and you know, same with retail that really jumped up to from the previous model or couple point back down and it is interesting, and that the but the intercept jumped up, so it's like you know, you're getting we know weird things that could just be kind of offsetting each other, right?

Um you'd have to yeah, spend a little time with it.

But I don't know, I feel like the picture is helpful because that's your your forecast from these coefficients, and you really are seeing quite a bit of stability, especially in the out years here.

So you get a better sense of that trade-off between okay, a couple things jumping around in that one period, but it's not like the slope changed a lot, and then that would make you think like oh, the model was saying, right?

Like was thinking about this as like a forever thing, so one off, yeah.

So that concludes the portion on the sales tax.

Um, yeah, we shade F ones back and certainly look forward to so uh another part of the IRFC aside from uh analyzing revenues and our forecast is um coming up with uh preliminary recommendations to be submitted to the CFO before August 1st.

And so that's what we're uh looking at today.

Um so one of the recommendations we have here is you know, something that we've recommended in previous uh years, but continuing to think about um fiscal sustainability for ARPA.

Um as Dean mentioned earlier, you know, we're thinking about the allocation of the reserves uh that we have for our programs, uh continuing to collaborate with them in the coming months and year, thinking about different funding options for the programs that are in place and if they will continue to remain into the out years after 2020.

Uh the next recommendation is um evaluating the validity of methods used by the county and exploring potential modifications to existing revenues uh that are in the county's budget uh and in general fund.

Um so as you could see from the alligator chart here that was referenced earlier uh in 2027 into the out years, we're looking at some pretty significant uh deficits in general fund.

So uh, you know, as the county would maybe look at different scenarios to potentially modify taxes that are currently in place in the general funds, um, you know, assessing the validity of the methods used uh by the county uh to determine if these are sound.

Is this um are some of the ones that we've we talked about today?

The examples of what would fall under this umbrella?

Yeah, yep.

And I think like kind of can continuing that as well.

So the value at the validity of methods.

So I guess I'd like to explore that a bit further and that mechanism through which that happens because you know we brought up the elasticity and additional research surgeon.

The focus is on the methodology, which we talked, yes, it should be um how much direction on the methodology and uh uh questions answered work sessions.

Are we gonna are you guys going to be able to provide for us to fulfill that responsibility?

Yep.

Yes, and then uh the last recommendation, yeah.

Sorry, I I um I don't see any reason to restrict this to the general fund.

So I don't know if that's implied here or not, but I guess any revenue.

I I mean, I think the health care revenues are like a that's largely farmed out.

But yeah, any certainly any tax recent we should have a consistent methodology to I think uh and I don't know if Dean, if you want to chime in, but um I the general fund has a lot of our home rule taxes, so kind of starting there.

Um I think was some of the thinking behind just naming the general fund.

I don't think there are any taxes outside of the general fund.

Yeah, okay, yeah.

Or maybe like a special purpose fund, but I can't think of anything significant.

Certainly not at the hospitals, right?

So that so it's limited to um taxes.

This recommendation.

This limit okay, it's limited to taxes.

So we're not talking about I guess fees on it.

That's what we're not that's just left out again.

Right.

Yeah.

Um sometimes we do those things do come up, but that's fine if we want to restrict it.

We want to focus on taxes.

That makes sense.

Yeah.

Yeah, I think that would probably be our preference here.

The fees are supposed to be cost.

So what the issue of fee, right?

It should be consistent with the cost that we're referring.

We need to evaluation and make sure cost.

I see.

Yeah, so that that's yeah, that's not something that is for consideration for well, like the the what we're doing, what you're talking about doing with gambling, the gambling uh uh stations.

That's I guess it's the tax.

I'm not sure exactly what separates a tax from a fee at that point, right?

Okay, yeah.

Yeah.

And then uh this uh third uh recommendation is to establish a protocol to evaluate new and alternative revenue sources, um, not in the county's budget uh with the IRFC to address the out year structural deficits in the general fund.

Um I'd like uh you guys to think about this but more and give some more direction at the the next meeting.

So again separating policy from methodology and the role that we're supposed to have is a legal consideration or an implementation feasibility considered more policy or methodology.

So I I would like a clear understanding of the expectations that you will you guys would have of me.

Yeah, I agree.

That would be okay.

Um and so just you know after August, um, you know, there is a an accompanying written of service recommendations.

Um also include kind of like deliverable timelines for these three items, um, and that will get submitted to the board um September.

Um so we'll you know we'll be working to draft this report in the coming weeks and you know we'll want to give back uh to incorporate that into the report um so that we could yeah, have make sure there's clear guidance and direction to the IRSC moving forward.

Sounds good.

Um and then uh uh meeting calendar and just some of the upcoming have another one um next month on the 26th.

Um and then we're have a break until uh October where we'll be presenting uh the next long-term forecast and the executive recommendation for 2027.

So I'm wondering if we can move the meeting on the 26th book, because I'm teaching on Wednesday nights now.

Uh and the October one as well was on a Wednesday night, so I wouldn't be able to attend either of those.

Um yeah, we could um we could talk after this to see if there's um a better day that we to see if okay.

Okay, better do you have the day that's better?

So I can go and check my calendar.

Um I think any other day.

Well, you all want to cut um uh but uh chair that concludes our presentation.

The next item on the agenda is public comment.

Uh Paloma, do we have any public speakers?

Um we do not have any registered public speakers.

Okay, Paloma, do we have any public speakers registered in the virtual chat box?

We have no registered public speakers in the chat box.

Thank you.

Uh the next item on the agenda is adjournment.

Uh is there a motion to adjourn?

I'll make the motion to adjourn.

Is there a second second second?

Okay, great.

The motion to adjourn has been moved by Commissioner Ogila and second by Commissioner Fay.

All those in favor signify by saying uh in the opinion of the chair, the ayes have it.

The meeting is adjourned, and next meeting uh will be Wednesday, August 26th, uh 2046 examples.