In response to the pandemic, Staff developed a series of business assistance accommodations, as well as opportunities for increased outdoor dining for restaurants in both Downtown and throughout the community.  In May 2020 the Village Board authorized the creation of Arlington Alfresco in Downtown Arlington Heights.  Based on the success of Arlington Alfresco over the past two years, the Village Board wishes to implement this event in 2022 and future years beginning the first week in May through the last week in September.  Some restaurants throughout the Village implemented outdoor dining within parking lots on private property.  However, Arlington Alfresco has required the closure of portions of Downtown streets and the use of public rights-of-way.

Restaurants, bars, and other businesses in Downtown Arlington Heights uniquely and directly benefit from Arlington Alfresco through increased sales and visibility.  In order to safely and effectively manage Arlington Alfresco, the Village provides equipment, personnel, and enhanced services that cannot be funded through the existing Food & Beverage tax.  As such, the Village will facilitate the annual presentation of the Arlington Alfresco event by increasing the rate of the Village’s Food & Beverage Tax for properties fronting along the following Village streets: (i) Campbell Street, east of Highland Avenue and west of Dunton Avenue; and (ii) Vail Avenue, south of the intersection of Wing Street and Davis Street and north of the property commonly known as 88 South Vail Avenue (See attachment:  Arlington Alfresco FBT Map). The new tax will allow Arlington Alfresco to be paid for by patrons of the Alfresco businesses vs. the general community taxpayers.   The rate of the additional tax shall be ¾ percent of the purchase price of prepared food and liquor, the ultimate incidence of any liability for payment of which shall be borne by the purchaser.  The net change will be an increase in the total Food & Beverage tax from 1.25% to 2% for those applicable establishments located in the Arlington Alfresco area identified above.  The effective date of this change is February 1, 2022.

Downtown businesses have been consulted on this new tax and it was discussed in detail at the December 13th Committee of the Whole Meeting. 

RECOMMENDATION

It is recommended that an Ordinance Amending Chapter 11 of the Arlington Heights Municipal Code, pertaining to the Food and Beverage Tax, be approved.