Gahanna's Issue 4, a proposed city income tax rate increase from 1.5 to 2.5 percent, failed by 122 votes May 7.

Gahanna's Issue 4, a proposed city income tax rate increase from 1.5 to 2.5 percent, failed by 122 votes May 7.

According to unofficial results from the Franklin County Board of Elections, the levy was defeated with 1,933 voting against it and 1,811 in favor of the measure.

Mayor Becky Stinchcomb said she's very disappointed with the results.

"I expected it to be close," she said. "I was hoping it would be close the other way. It was a complicated issue. We knew we had an uphill battle explaining it with the rate and credit component."

Stinchcomb said people didn't want to pay more taxes, or they felt the city didn't need it.

"Close is better than losing by a lot," she said. "We'll be talking to council about (next) steps."

The tax was for general municipal operations and services, including but not limited to police, street maintenance, parks and recreation, and capital improvements.

Stinchcomb has said the city needed to either increase its revenue or make serious cuts to have a balanced budget in the future.

The proposed rate would have generated about $8 million annually, which is the same as the city's projected deficit.

If approved, the tax would have been effective beginning Jan. 1, 2014.

Gahanna City Council approved legislation May 6 to increase the tax credit from 83.3 to 100 percent, pending levy approval.

Most of Gahanna's working residents are employed in a city that has a 2.5-percent income tax rate for which Gahanna currently gives an 83.3 percent credit, for an effective tax rate of 2.75 percent, city leaders have said. Under the proposed tax increase and full credit, those same residents' effective tax rate would have been reduced to 2.5 percent.

Gahanna resident Kelly Siegel said she still was debating her vote May 6.

"My husband lives and works in Gahanna, and I work in Columbus," she said. "I think the city is beautiful and taken care of. I'd like to see services kept up. I use the dog park. Keeping Gahanna nice is also beneficial to the schools."

Dr. Michael Pamer, a Gahanna chiropractor, said he also was undecided the day before the election. He said he realizes the pros and cons of the issue.

A s a small-business owner, Pamer said, it would affect his financial bottom line. But being a Gahanna resident with three children, he also enjoys living in a nice community.

"You want what's best for the family, and it sometimes affects spending," he said.

Gahanna resident Steve Jarvis, who's also a business owner, said he's all for supporting the community, but he isn't convinced all options have been examined to reduce costs.

"When public entities don't investigate methods for cutting costs, I'm against raising taxes of any kind," he said.

Gahanna business owner Jeannie Hoffman said people who work and live in Gahanna would have seen the biggest income-tax increase.

"As an example, I will use my employee: She makes approximately $10,000 a year as a part-time hourly person," Hoffman said. "She will see an increase of a little over $100 in her Gahanna city tax. That may not seem like much to most people, but that is just on a part-time job, and to my employee, it is a lot.

"I am a Gahanna resident and a sole proprietor of a business located in Gahanna," she said. "My business income is reported on a Schedule C and all of income will be taxed at a higher rate."

Hoffman said it would have been better if the city had waited until November to place the issue on the ballot because November has a much better representation of citizens.

Stinchcomb said a levy failure would mean reductions in city staffing levels and equipment for all departments, including the police force.

Other areas identified as at-risk included the parks system and parks maintenance, road maintenance, economic development investment, basic services and community enhancement programs like the street-sign program and continuation of multipurpose trail construction.

Gahanna has one of the lowest tax rates in Franklin County, along with Reynoldsburg at 1.5 percent.

Columbus, Bexley, Whitehall and Worthington have a 2.5-percent tax rate. Cities with a 2-percent or 2.25-percent rate include Dublin, Westerville, Hilliard and New Albany.