Kelly: Income tax request must include spending plan
An ordinance that would cut the city's income tax credit in half received a second reading at Reynoldsburg City Council's June 24 meeting before being sent back to the finance committee, where it likely will languish.
Council members appear to find pursuing an income tax increase request more palatable than the tax credit cut. Both would raise taxes, but Reynoldsburg residents would be able to vote on the income tax increase request.
Council could enact the tax credit cut on its own, without a vote by residents. If approved, the tax credit reduction would raise taxes for 80 percent of employed residents who work outside Reynoldsburg. Those residents would pay a 0.75-percent income tax to the city on top of whatever they pay the city where they work.
Three council members were absent from Monday's meeting -- Mel Clemens, Barth Cotner and Scott Barrett.
Kelly was absent from the finance committee meeting last week, when Clemens asked that the tax credit ordinance be sent for a second reading, then held in committee. Committee members voted 5-1 at that meeting to prepare an ordinance that would place a 1-percent income tax increase levy on the fall ballot.
If approved by voters, the levy would increase the city's income tax rate from 1.5 percent to 2.5 percent.
"I was very glad to hear that this has been moved forward for a tax levy instead of an income tax credit (cut)," Kelly said. "Before we put something on the ballot, however, we need to talk specifically about where the money is going. We have to have a clear plan that we can put in front of voters, otherwise, we will be setting it up for failure.
"I can't support a tax increase levy without that plan," she said.
Kelly has said in the past she is opposed to reducing the income tax credit because it would raise taxes "through the back door" without voter approval.
Councilman Chris Long cast the dissenting vote on preparing the tax increase ordinance during the June 17 finance committee meeting because he said council members were setting up an either-or situation for residents.
"You are effectively holding a boulder over people's heads and saying if you do not approve this ballot issue, we will do a third reading on the reduction and raise your taxes anyway," he said.
Clemens, who initiated discussions on the tax credit reduction last month, has said the city badly needs revenue, from either a tax credit reduction or a higher income tax rate.
"We don't have enough money to function well compared to other cities of our size," he said.
Auditor Richard Harris said the ordinance to seek an income tax increase must be approved before Aug. 7 if the tax issue is to appear on the November ballot.
The full council will meet in committee meetings to discuss both ordinances and other city business at 7:30 p.m. July 1 at the Reynoldsburg Municipal Building, 7232 E. Main St.
In other business June 24, council approved an ordinance accepting an $80,000 grant from the Ohio Environmental Protection Agency to build a sustainable parking lot and rain gardens at the Reynoldsburg Senior Center.
The ordinance also appropriated the city's 40-percent share of the project, or $53,426.
The project includes installing 700 feet of rain gardens and 3,000 square feet of pervious pavement, which would allow rainwater to pass through the surface.