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G45-98 CITY OF ELGIN ORDINANCE NO. G45-98 AMENDING THE FEE SCHEDULE FOR CERTAIN AUTOMATIC FOOD VENDING MACHINE BUSINESS LICENSES ADOPTED BY THE CITY COUNCIL OF THE CITY OF ELGIN ON THIS 27TH DAY OF MAY 1998 Published in pamphlet form by authority of the City Council of the City of Elgin, Kane and Cook Counties, Illinois, on this 29th day of May 1998. STATE OF ILLINOIS ) ) ss. COUNTY OF KANE ) CERTIFICATE I, Dolonna Mecum, certify that I am the duly appointed and acting municipal clerk of the City of Elgin, Cook and Kane Counties, Illinois. I further certify that on May 27, 1998, the Corporate Authorities of such municipality passed and approved Ordinance No. G45-98, entitled An Ordinance Amending the Fee Schedule for Certain Automatic Food Vending Machine Business Licenses, which provided by its terms that it should be published in pamphlet form. The pamphlet form of Ordinance No. G45-98, including the Ordinance and a cover sheet thereof, was prepared, and a copy of such Ordinance was posted in the municipal building, commencing on May 29, 1998, and continuing for at least ten days thereafter. Copies of such Ordinance were also available for public inspection upon request in the office of the municipal clerk. DATED at Elgin, Illinois, on March 29, 1998. Municipal Clerk (SEAL) Ordinance No. G45-98 AN ORDINANCE AMENDING THE FEE SCHEDULE FOR CERTAIN AUTOMATIC FOOD VENDING MACHINE BUSINESS LICENSES WHEREAS, Ordinance No. G77-97 purported to establish an annual fee for a license for certain automatic food vending machines; and WHEREAS, no public hearing had been conducted prior to the increase in fees for coin operated vending machines contained in Ordinance No. G77-97 ; and WHEREAS, after due notice in the manner required by law a public hearing was conducted by the corporate authorities of the City of Elgin on May 13, 1998; and WHEREAS, it is in the best interest of the City of Elgin to increase the annual fee for a license for certain coin operated vending machines . NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF ELGIN, ILLINOIS : Section 1 . That Section 9 . 14 . 050 entitled "Fees" of e* Chapter 9 . 14 of the Elgin Municipal Code, 1976, as amended, be and is hereby further amended to read as follows : 9 . 14 . 050 FEES . The annual fee for a license for an automatic food vending machine shall be as follows : A. Machines dispensing ball gum, nuts, panned candy, prepackaged ice, prepackaged candy, cookies, crackers, or similar prepackaged, non-potentially hazardous snacks No fee. B. Machines dispensing capped or sealed bottled or canned beverages No fee. C. Machines dispensing beverages in a cup $30 . 00 . D. Machines dispensing hot and cold, frozen foods, milk, juice, and potentially hazardous food $30 . 00 . Section 2 . That all ordinances or parts of ordinances in conflict with the provisions of this ordinance be and are hereby repealed. ,,.. Section 3 . That this ordinance shall be in full force and effect from and after its passage in the manner provided by law. >7‘:■, Kevin Kelly, May Presented: May 27 , 1998 Passed: May 27 , 1998 Vote: Yeas 4 Nays 2 Recorded: May 28, 1998 Published: May 29 , 1998 Attest: Dolonna Mecum, City Clerk eft. e VOLUME LXIII MAY 13, 1998 340 Presented: May 13, 1998 Adopted: May 13, 1998 Vote: Yeas 5 Nays 0 Attest: s/ Dolonna Mecum Dolonna Mecum, City Clerk PUBLIC HEARING ON ADJUSTMENT TO VENDING MACHINE LICENSE FEE STRUCTURE William Hurley, Associate General Counsel, National Automatic Merchandising Association, stated the association' s objections to the proposed increases to the annual license fees for food. He said the proposed fees represent an increase of 200 to 500 percent increase, which is approximately one-third of the annual profit per machine. He requested that the Council consider lower fees. He commended the Council on eliminating fees for machines that dispense package snacks and beverages . Mike Mahoney of St. Charles stated that he is the owner of a number of machines located in Elgin. If the proposed fees are approved, the fees he would have to pay for the 26 machines that would have to be inspected would increase by 480 percent. He requested that if the Council chooses to increase the fees that it consider a lesser increase. No one else chose to speak. Mayor Kelly declared the public hearing closed and stated that correspondence and comments would be considered. APPROVAL OF FINAL PLAT OF SUBDIVISION TO BE KNOWN AS NORTHWEST CORPORATE PARK; PROPERTY LOCATED AT 2400 NORTH RANDALL ROAD, BY THE WISPARK CORPORATION, AS APPLICANT AND GALVIN FAMILY PARTNERS, L.P. , AS OWNER (PETITION 05-98) Councilman Schock made a motion, seconded by Councilman McKevitt, approve the request for final plat approval for subdivision known as Northwest Corporate Park. Yeas : Councilmembers Gavin, Gilliam, McKevitt, Schock and Mayor Kelly. Nays : None. ORDINANCE G40-98 PASSED AMENDING CHAPTER 6.06 ENTITLED "ALCOHOLIC LIQUOR DEALERS" OF THE ELGIN MUNICIPAL CODE, 1976, AS AMENDED, REGARDING CLASS G LIQUOR LICENSES Councilman Gavin made a motion, seconded by Councilman Schock, to pass the following ordinance. Yeas : Councilmembers Gavin, Gilliam, McKevitt, Schock and Mayor Kelly. Nays: None. (J\,�A OF E(c�'4 City of Elgin Memorandum V C� February 24, 1998 TO: Mayor and Members of City Council FROM: Joyce A. Parker, City Manager SUBJECT: License Fees for Coin Operated Vending Machines During the budget process, staff recommended and City Council approved an adjustment in the structure of vending machine license fees. It has come to our attention that under state law the City should have followed a specific process including a public hearing and written notice to vending machine license holders. The public hearing, meetings, and public notice conducted as a part of budget adoption do not appear to be sufficient to meet the law's requirements. This law applies only to vending machine licenses and does not impact any other actions taken by the City Council in adopting the 1998 Budget. Attached is a memorandum from Eric Stuckey that details the situation and options. The fee ordinance as adopted eliminated license fees for vending machines not requiring an inspection and raised the license fee for those requiring an inspection to $30, the cost of an inspection. The machines requiring inspection are those that are temperature controlled and contain perishable items. The impact of the adjusted fees would have been the elimination of license fees ($10 and $5) for approximately 290 (or 60%) of the 480 machines licensed in 1997. In terms of revenue, the restructured vending fees would result in a slight revenue increase to the City, an estimated $1,575. At this point, staff is prepared to take the necessary steps to implement the City Council's previous direction to revise the structure of coin operated vending machine licenses. Due to the notification requirements, a public hearing could not be scheduled until one of the April City Council meetings. Should the City Council desire any other action on this matter, please advise me by Friday, March 6. After this date, staff will begin the process of sending written notice to all vending license holders. Sincerely, yce . Parker City Manager Attachments .0 OF Etc. 1, Memorandum City of Elgin •r January 28, 1998 TO: Joyce A. Parker, City Manager Robert O. Malm, Chief Operating Officer/Assistant City Manager FROM: Eric S. Stuckey, Budget Director/Public Information Officer SUBJECT; License Fees for Coin Operated Vending Machines Recently, the City was notified by the National Automatic Merchandising Association that our changes to vending machine license fees should have followed a specific procedure outline in state law(see attached). At the time the fee adjustment ordinance was proposed and adopted, staff was unaware of a state law(see attached)that requires written notice to vending machine licensees and a public hearing. The public hearing, meetings, and public notice conducted during budget adoption do not appear to be sufficient to meet the law's requirements. This law applies only to vending machine licenses and does not impact any other actions taken by the City Council in adopting the 1998 Budget. The fee ordinance as adopted eliminated license fees for vending machines not requiring an inspection and raised the license fee for those requiring an inspection to $30, the cost of an inspection. The machines requiring inspection are those that are temperature controlled and contain perishable items. The impact of the adjusted fees would have been the elimination of license fees ($10 and $5) for approximately 290 of the 480 machines licensed in 1997. In terms of revenue, the restructured vending fees would result in a slight revenue increase to the City, an estimated $1,575 increase. At this point, it appears there are two options for the City: (1) conduct required hearings and notice and consider the fee adjustment again; or(2) repeal the previous ordinance and revert to the 1997 fee schedule for vending machines. Finance staff has been directed to collect only the 1997 fees for vending machine licenses until the issue is resolved. Please advise as to how you would like to proceed. Should you have any questions or require additional information, please contact me. Respectfully submitted, Eric S. Stuckey Budget Director/Public Information Officer e' Attachments cc: Mr. Nowicki NATIONAL � Z \ AUTOMATIC ..r....rx.i\A MERCHANDISING ASSOCIATION Serving the Vending/Foodservice management industry January 8, 1998 The Honorable Kevin Kelly Mayor, City of Elgin 1501 Dexter Court Elgin, IL 60120 Dear Mayor Kelly: I represent the National Automatic Merchandising Association, the national association for the coin-operated merchandise vending machine industry. Recently, some of our members doing business in Elgin informed me that the fees required under your merchandise vending machine ordinance were increased by $20 per machine in December 1997. I have had to advise these members to pay under the pre-December 1997 level for their machines since the city council failed to comply with Illinois law as set forth in 65 ILCS 5/11-55-2 in the adoption of the revised ordinance. Therefore, the new rate is null and r void. The industry stands ready to assist you in the adoption of a revised ordinance should Elgin choose that route. If necessary, we can supply you with a model statute which addresses these issues. I you need further input from the industry please let me know. Sincerely, 4),i..Q914..4;:(- William F. Hurley Assistant General Couns- WFH/jmj cc: Erwin Jentsch, Elgin Corporation Counsel • r HEADQUARTERS: 20 N.Wacker Drive,Chicago,IL 60606-3102 (312)346-0370 FAX(312)704-4140 EASTERN OFFICE: 11718 Bowman Green Drive,Reston,VA 20190 (703)435-1210 FAX(703)435-6389 SOUTHERN OFFICE: 1640 Powers Ferry Road, S.E., Bldg.24, Marietta, GA 30067 (770)988-0048 FAX(770)988-0404 WESTERN OFFICE: 16030 Ventura Boulevard, Encino,CA 91436 (818)783-8363 FAX(818)783-0232 - [ January 13, 1998 MEMORANDUM TO: Eric Stuckey, Budget Officer FROM: Erwin W. Jentsch, Corporation Counsel SUBJECT: License Fees for Coin Operated Vending Machines At the conclusion of the 1997 fiscal year a number of license fees were increased. One of the increases was for coin operated vending machines . The fee for machines dispensing packaged snacks and capped or sealed or bottled or canned beverage was eliminated but the fee for machines dispensing beverages was increased. See Ordinance G77-97 . However by state statute, the city's home rule authority to increase license fees for vending machines is qualified by a requirement that no increase is effective unless preceded by a public hearing after notice to licensees . See 65 ILCS 5/11-55-2, copy attached. Therefore the increase described can not become effective until after the required notice and hearing. I recommend that the city continue to collect the fees in existence in 1997 until further action following a hearing is eft. taken by the City Council. Etpb nr Attachments r -Tr- t44 .345 MUNICIPALITIES 65 ILCS 5/11-57-1 1 I. ' i herindecent exposure of the person or suggesting lewdness or Formerly Ill.Rev.Stat.1991,ch.24,111-55•-1. iiIar immorality. 135 ILCS 51o/1 et seq. sofrLaws 1961,p.576, § 11-54.1-2,added by Laws 1963,p.860, or § 1,eff.July 1,1963. "• -" 5/11-55-2. License fees—Increases ard Formerly Ill.Rev.Stat.1991,ch.24,11164.1-2. § 11-55-2. No municipality with a population of less than • • 1• ,000,000, including a home unit, may increase the fee i t rule 5/1l-54.1-3. Granting of permit. for a license to own or operate a vending machine or to t ,} § 11-64.1-3. No such permit shall be granted by the dispense goods or services therefrom unless notice of a public corporate authorities until they shall have investigated the hearing on the matter has been given and such hearing has TS carnival and are satisfied that,if permitted,it will be operat- been held.• Notice of the proposed increase shall be mailed t ed in accordance with the permit and the provisions of this at least 30 days before the hearing to the last known address Division 54.1. Such corporate authorities may issue the of each person currently holding such a license. It is de- i , permit and collect permit fees necessary to pay the expenses dared to be the law of this State,pursuant to paragraph(g) of the investigation and to aid in policing the grounds and of Section 5 of Article VII of the Illinois Constitution, that 1 I otherwise to compensate the city, village or incorporated this amendatory Act of 1986 is a denial of the power of , town in such amount as the corporate authorities may deter- certain home rule units to increase vending machine license I mine. Each permit shall contain the'proviso that sheriffs fees without complying with the requirements of this Section. . ! and police officers shall have free access to the grounds and Laws 1961, p. 576, 1 11-55-2, added by PA 84-1479, § 1 J dity all booths, shows and concessions on such grounds at all eff.Feb.10,1987. r tibi- times, and it shall be the duty of all officers present at such Formerly I11.Rev.Stat.1991,ch.24,111-55-2. ; I the carnival to enforce all the provisions of this Division 54.1. t but Laws 1961,p.576,§ 11-54.14,'added by Laws 1963,p.860, OIL AND GAS ("" § 1, eff. July 1, 1963. Amended by PA 83-341, § 1 eff. Sept.14,1983. DIVISION 56. OIL AND GAS PERMITS i Formerly I11.Rev.Stat.1991,ch.24,111-54.1-3 Section 5/11-56-1. Permits to mine oil or gas. t 5/11-54.1-4_, Issuance of permit in duplicate i, l 1 -§ 11-54.1-4.• The permit as provided for in this Division 5/11.56-1. Permits"to mine oil or gas. . i) • 54.1 shall be made in duplicate, one copy thereof being retained bythe corporate authorities. The other copy shall 1 11-56-1. The corporate authorities of each municipality i'! be kept in the possession of the manager of the carnival and may grant permits to mine oil or gas,under such restrictions shall be produced and shown to any sheriff, police officer or as will protect public and private property and insure proper citizen,upon request. remuneration for such grants. ellik Laws 1961, 576,§ 11-56-1,eff. 1,1961. Laws 1961,p.576, § 11-54.1-4,added by Laws 1963, p.860, p. July § 1, eff. July 1, 1963. Amended by PA 83441, § 1, eff. Formerly III.Rev.Stat.1991,ch.24,111-56-1. Sept.14,1983. ' Formerly Il1.Rev.Stat.1991,ch.24,1 11-54.1-4. RAILROAD SAFETY 5/11-54.1-5. Violations DIVISION 57. GENERAL RAILROAD § 11-54.1-5. Any person who violates any of the provi- SAFETY REGULATIONS • sions of this Division 54.1 is guilty of a petty offense. Section I `�. ega- Laws 1961, p.576, § 11-54.1-5,added by Laws 1963, p.860, 5/11-57-1. Grade of track—Ditches. i ling 1 1, eff. July 1, 1963. Amended by PA 77-2500, § 1, eff. one Jan.1,1973. 5/11-57-1. Grade of track—Ditches 1po- Formerly Ill.Rev.Stat.1991,ch.24,111-54.1-5. . I i, any §11-57-1. The corporate authorities may compel rail- tout • i•" road companies to raise or lower their tracks to conform to f ion, COIN OPERATED DEVICES any grade which,at any time,is established by a munitipali- , f of DIVISION 55_ TAX ON COIN OPERATED DEVICES ty. Where the tracks run lengthwise of any street or alley, ; the companies shall keep their tracks on a level with the Section' street surface,so that the tracks may be crossed at any place 360, 5/11-55--1. Authorization. on that street or alley. - 5/11-55-2. License fees—Increases. The corporate authorities may compel railroad companies . to make, open, and repair ditches, drains, sewers, and cul- 5/11-55--1. Authorization verts along and under their tracks, so that water cannot I . § 11-55-1. The right to tax the games or devices de- stand on their property, and so that the natural drainage of + t or scribed in"An Act to provide for the taxation and licensing of adjacent property is not impeded. P ted certain coin-operated amusement devices and to prescribe Laws 1961,p.576,§ 11-67-1,eff.July 1,1961. I ies penalties for the violation thereof",approved July 7, 1953,as Formerly IA.Rev.Stat.1991,ch.24,.111-57--1. ich heretofore and hereafter amended,'is not exclusive with the :ed State of Illinois,but municipalities of the State of Illinois may DIVISION 58. RAILROAD GRADE ed impose taxes.or license fees on such games and devices as m- described in said Act of 1953 and may regulate or control the SEPARATION TAX ny operation of the same within such municipalities. Section " Laws 1961,p.576,§ 11-55-1,eff.July 1,1961. 5/11-58-1. Authorizationrilk �II . 4 ' I{ NATIONAL e AUTOMATIC MERCHANDISING ® ASSOCIATION Serving the Vending/Foodservice management industry May 5, 1998 Honorable Kevin Kelly Mayor, City of Elgin 1501 Dexter Court Elgin, IL 60120 Dear Mayor Kelly: On May 13, the council will be deliberating a proposed modification to the current vending machine licensing ordinance. The proposal is well drafted in certain respects. First, it exempts snack and candy machines that only vend prepackaged items. Secondly, it specifically mentions machines that vend potentially hazardous foods. These two modifications are consistent with nation-wide health department standards that take into account the disparate level of health risks for different types of machines. However, this proposal also increases the annual license fees for food vending machines located within Elgin. On certain machines, the annual fee will increase from the current range of$5-$10 per machine to $30 per machine. This is an increase of 200% to 500%. Given this percentage increase, the proposed ordinance seems to be a revenue-enhancing device. This is prohibited by, Quad Canteen Service Corp. v. Ruzak, 85 Ill. App. 3d 256, 406 N.E.2d 616 (1980). According to Quad Canteen, license fees must bear a reasonable relationship to the costs associated with regulation and is not to be a tool of taxation. Enclosed is a model fee schedule computed by the vending industry. This is only a suggested guideline. It is the industry's position that the level of the proposed increase at this given time is not warranted and we urge you to consider a more modest increase. I look forward to meeting you on the evening of May 13th in your council chambers. Sincerely, William F. Hurley NAMA Associate General Counsel WFH/ld Enclosure HEADQUARTERS: 20 N.Wacker Drive, Chicago, IL 60606-3102 (312)346-0370 FAX(312)704-4140 EASTERN OFFICE: 11718 Bowman Green Drive, Reston,VA 20190 (703)435-1210 FAX(703)435-6389 SOUTHERN OFFICE:1640 Powers Ferry Road, S.E.,Bldg.24, Marietta,GA 30067 (770)988-0048 FAX(770)988-0404 WESTERN OFFICE: 16030 Ventura Boulevard, Encino,CA 91436 (818)783-8363 FAX(818)783-0232 A e National Automatic Merchandising Association 20 N. Wacker Drive - Suite 3500 Chicago, IL 60606-3102 312/346-0370 FAX 312/706-4140 Model Fee Schedule for Vending Machines Fees for food and beverage vending machines: TOTAL VENDING MACHINES FEES 1-10 machines $40/year 11-20 machines $65/year 21-30 machines $95/year 31-40 machines $120/year 41-50 machines $150/year 51-60 machines $175/year 61-70 machines $200/year 71-80 machines $230/year 81-90 machines $250/year 91 + machines $280/year Food and beverage vending machines include those which dispense hot beverage, cold cup soft drinks, milk, ice cream, cold food and water. 5/98 . ,c,4OFEL.0 . City of Elgin , + Mayor Pe '�' '/ Ila- Kevin Kelly RATED Council Members Terry Gavin Robert Gilliam John T McKevitt April 9, 1998 Ed schock John Walters Marie Yearman TO: Vending Machine License Holders RE: License Fees for Coin Operated Vending Machines Attached is a notice of a public hearing to all vending machine license holders. During the 1998 Budget process, staff recommended and the City Council approved an adjustment in the structure of vending machine license fees. It has come to our attention that under state law, the City should have followed a specific process including a public hearing and written notice to vending machine licence holders. The public hearing, meeting, and public notice conducted as a part of budget adoption do not appear to be sufficient to meet the law's requirements. This law applies only to vending machine licenses and does not impact any other actions taken by the City Council in adopting the 1998 Budget. The fee ordinance as proposed would eliminate license fees for approximately 290 of the 480 machines licensed in 1997. The remaining machines requiring an inspection would be assessed a fee of$30.00 for the cost of the inspections. The food and beverage machines requiring inspection are those that are temperature controlled and contain perishable items. Should you have any questions or require additional information, please contact me at (847) 931-5636. Respectfully submitted, tt Martin Gregory Assistant Finance Director MG/ai Attachment 150 Dexter Court • Elgin, IL 60120-5555 • Phone 847/931-6100 • Fax 847/931-5610 • TDD 847/931-5616 NOTICE OF PUBLIC'HEARING ON ADJUSTMENT TO VENDING MACHINE LICENSE FEE STRUCTURE ELGIN CITY COUNCIL ELGIN, ILLINOIS On Wednesday, May 13, 1998 at 7:30 p.m. a public hearing will be held by the City Council of the City of Elgin, at Elgin City Hall Council Chambers, 150 Dexter Court, Elgin, Illinois, for the purpose of considering adjustments to the license fee structure for vending machine licenses. This notice is served upon you pursuant to the provisions of Section 5/11-55-2 of Chapter 65 of the Illinois Compiled Statutes. You are further notified that said vending machine license fees may be amended after the public hearing. All interested parties are invited to attend the public hearing and will be given an opportunity to be heard. By order of the Corporate Authorities of the City of Elgin, Kane and Cook Counties, Illinois. City of Elgin Dolonna Mecum City Clerk