Reynoldsburg News

Proposed income tax increase

Kelly, Long seek details on how $5M would be spent

By ThisWeek Community News  • 

The first reading of an ordinance July 8 to place a 1-percent city income tax hike on the November ballot sparked a discussion among Reynoldsburg City Council members about presenting a plan to residents on how the additional revenue would be spent.

If the tax issue gets to the fall ballot and is approved by voters, it would raise the city income tax rate from 1.5 percent to 2.5 percent, generating about $5 million per year for Reynoldsburg, according to City Auditor Richard Harris.

"I would like a plan A and a plan B," Councilwoman Leslie Kelly said. "Plan A would indicate what city services and capital improvements might look like if we don't get this additional revenue. Plan B would show what the capital improvements and city services would look like if we do get the money."

Harris said the latest capital improvements have been accomplished with grants, since "very little" money has been appropriated for those improvements.

"If we get additional funds, they could go to adding police officers and improving other services," he said.

"I think the community needs to see a plan that shows what it will look like if we keep the same amount of funding we have now," Kelly said. "For instance, would services such as parks and recreation, police officers or other city services diminish with the same amount of funds? People have asked me, 'how will it affect me and what are you going to do with the money?'

"They want to know if we will have cuts in any services if the tax issue does not pass," she said.

Kelly specifically asked Harris and Mayor Brad McCloud if they could come up with a plan A and B.

McCloud said it is a complicated issue.

"The challenge is that all I can do is propose to council what I think the city services could be, but they might not square with your expectations," he said.

Councilwoman Monica DeBrock pointed out that Reynoldsburg has already lost an "excellent credit rating" due to finances.

"New funds may still not be able to improve that credit rating," she said.

Councilman Chris Long said he also wants to know how the money would be spent.

"I want a list so that our citizens know where their tax dollars are going," he said.

Long was the only council member to cast a dissenting vote during the June 17 finance committee meeting on preparing a tax-increase ordinance.

As an alternative in boosting revenue, council members have also discussed cutting the city's income tax credit in half, which would raise taxes for people who live in Reynoldsburg but work elsewhere. That ordinance has so far had two readings and was sent back to the finance committee.

Long said council is setting up an "either-or situation" where if the tax increase fails on the ballot in November, council could do a third reading and approve the tax credit reduction ordinance, effectively raising taxes for the 80 percent of residents who work outside the city -- without voter approval.

Harris said the tax credit reduction would bring in about $3 million annually, about $2 million less than the income tax increase.

He said the ordinance to put a 1-percent income tax increase on the ballot must be approved before Aug. 7 in order to get it on the November ballot. It, too, was sent back to the finance committee for possible further discussion before a second reading.

The next council committee meetings are scheduled at 7:30 p.m. July 15 at the Reynoldsburg Municipal Building, 7323 E. Main St.

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