Residents of households with the median Franklin County income will pay about $57 more for products bought locally next year because of a half-penny-per-dollar increase in the sales tax approved yesterday by the county commissioners. The commissioners, who had been telegraphing a tax increase for almost a year, repeated that the additional money is needed to shore up the county's budget, pay for major building projects and establish an economic-development fund to create jobs.
Residents of households with the median Franklin County income will pay about $57 more for products bought locally next year because of a half-penny-per-dollar increase in the sales tax approved yesterday by the county commissioners.
The commissioners, who had been telegraphing a tax increase for almost a year, repeated that the additional money is needed to shore up the county’s budget, pay for major building projects and establish an economic-development fund to create jobs.
In a 3-0 vote, the commissioners, all Democrats, approved increasing the sales tax permanently by a quarter of a penny per dollar to “keep the lights on,” as county Administrator Don Brown said. The other quarter-penny is temporary and is to go away at the end of 2018.
The temporary quarter-penny increase will be used to pay cash for a new, $150 million jail complex and a $50 million morgue and lab, among other infrastructure needs, saving as much as $115 million in interest. The increase also is to seed the proposed economic-development fund.
The combined half-penny increase is expected to raise more than $100 million a year.
The vote means the total sales-tax paid in the county will rise on Jan. 1 to 7.5 percent, second-highest in Ohio behind Cuyahoga County. That rate includes taxes collected by the state and the Central Ohio Transit Authority, however; the portion collected by the county will remain lower than in many other Ohio counties.
The increase will bring the county’s share of the total collected sales tax on purchases to 1.25 percent, which is the same as in 12 other counties, including Cuyahoga, Delaware, Madison and Union. The state-allowed maximum of 1.5 percent is levied by 47 other counties.
Cost estimates available from the Internal Revenue Service show that a household making about $50,100 a year — the median household income in Franklin County, according to census figures — will pay about $57 more per year for durable goods. Large purchases such as cars and appliances would skew the numbers.
Someone buying a $25,000 car, for example, will pay an additional $125 next year. A $1,300 refrigerator and $800 TV will cost $6.50 and $4 more, respectively.
Because counties receive sales-tax payments from the state three months after they’re collected at the cash register, the county will receive the increased revenue starting in the second quarter of 2014.
Before yesterday’s vote, deputy county Administrator Kenneth Wilson listed the ways the county has pinched pennies for the past few years as revenue has dwindled:
• At $303.9 million, the county’s 2013 general-fund budget is almost $4 million less than was spent in 2008.
• Personnel costs have dropped from $135.8 million in 2010 to $133.3 million in 2012, in part because the county has eliminated more than 400 full-time jobs through attrition since 2009.
• The county has saved $65.9 million on health care since 2009 through plan changes and increased co-pays.
No one spoke against the tax during the commissioners’ public meeting yesterday. Throughout the public-hearing process, few county residents have spoken out against the tax increase.
However, some people took to Facebook and Twitter yesterday afternoon to voice their displeasure, often saying they will shop for large purchases either online or outside the county. One exception is cars and other vehicles, which are taxed according to the rate in the county where the buyer lives.
Greg R. Lawson, a Republican candidate for the Columbus City Council, said yesterday that the commissioners decided on the increase in a vacuum, not considering the net effect of several increased taxes.
The state’s recent quarter-penny sales-tax increase, Columbus’ 2009 income-tax increase and the prospect of a 9.01-mill Columbus City Schools levy this fall all add up, he said.
“It’s not what happens tomorrow that I’m worried about, so much as it is what happens in five years to things such as attracting new businesses,” Lawson said. “The fact is that bad tax policy, over time, drives people away.”
Commissioner Paula Brooks said paying cash for large capital improvements such as a jail and morgue is unusual, but maybe it’s time to rethink the usual. She said homeowners would pay cash instead of taking out mortgages on their homes if they could.
“This will save our children and our children’s children hundreds of millions of dollars” in interest payments, Brooks said. “We have to look at that.”
Commissioner Marilyn Brown said Franklin County is the nation’s seventh-strongest regional economy. But the county also has one of the highest poverty rates among its peers and has the highest rate of infant mortality.
“There’s a level of support for human services below which a civilized society must not go,” Brown said. “We have gotten there.”
That’s why some of the temporary, quarter-penny increase approved yesterday will be used to restore state and federal cuts to social-service programs, such as those at the county’s Job and Family Services agency, she said.
When the county last passed a sales-tax increase, in 2005, the commissioners said it would last for five to seven years. Asked yesterday whether the commissioners would make such a commitment now, Commissioner John O’Grady said this increase will last between five and 10 years.
He said the resolution automatically triggers a quarter-penny increase to drop off after five years, and the commissioners would have to act again to keep it on the books longer.
“I would tell you that, as of today, there’s nobody who has an appetite for doing something of that nature,” O’Grady said.