The Urbana City Council has approved raising the city's sales tax by a quarter of a percent.
The new rate will be 9 percent, which is just below Chicago and in line with Champaign.
Officials say that this is the only way to address rising costs as well as regular expenses for payroll, pension, and healthcare costs.
The mayor of Urbana says that the nearly million dollar budget short fall was created by Carle Foundation Hospital’s tax exempt status.
The increased sales tax takes effect in January.
It does not apply to prescription medications and groceries, and big-ticket items, like cars.