Powell leaders in July approved a $5 vehicle-registration tax to help improve the city's infrastructure, but it will be a while before the money starts coming in.
The city has filed its ordinance levying the tax with the state of Ohio, but a spokesperson with the Ohio Department of Public Safety said the deadline to begin collecting the tax for the subsequent registration year is July 1.
This means Powell residents would begin paying the tax when they purchase their vehicle registrations for 2021.
Lindsey Bohrer, assistant director of communications for the public-safety department, said the Ohio Bureau of Motor Vehicles database is updated in September and registrations may begin being renewed in October. But she said the law allowing the tax to be enacted prescribes a July 1 deadline for collection on registrations purchased for the subsequent registration year.
"A registration year is defined from Jan. 1 to Dec. 31, but registrants can renew 90 days ahead of expiration," Bohrer said. "So, for example, if we receive the ordinance before July 1, 2020, and everything is in order, we will implement it for the 2021 registration year."
What it boils down to is that the city's ordinance is too late for 2020 but several months ahead of the deadline for 2021.
City Council voted to enact the registration tax at its July 16 meeting and filed its ordinance with the state last week, city spokeswoman Megan Canavan said.
The city has no control over how long it takes the state to begin collecting the fee, she said.
The ordinance was approved by a 4-3 vote of council. Jon Bennehoof, Frank Bertone, Tom Counts and Melissa Riggins voted in favor of the tax; Brian Lorenz, Brendan Newcomb and Dan Swartwout opposed it.
The tax was a response to voters' rejection of a proposed increase in the city's income tax in November 2018.
The proposal would have raised the income tax from 0.75% to 1.15% while also increasing the tax credit from 0.25% to 0.5% for residents who live in Powell but work in and pay income taxes to another municipality.
After the tax proposal failed, city officials began pondering other ways to generate funds to be used for delayed street work.
Supporters of the vehicle-registration tax cast it as a small way to address the city's road maintenance and improvement needs.
Whereas language in the ordinance allows the funds to be used for "public roads, highways, and bridges; costs associated with street and traffic signs; debt service obligations; and costs for similar purposes," Canavan said the money would be "earmarked for road maintenance."
The tax would raise an estimated $62,000 per year and affect approximately 12,500 registered vehicles, Canavan said.
All money collected would be distributed back to the municipality the month after it is collected, Bohrer said.