Grove City's financial-review task force pitches 2.5% income tax
Grove City's Citizen Financial Review Task Force is recommending the city explore raising the current level of income tax from 2% to 2.5% to increase revenue.
The 15-member task force has been reviewing issues relating to city finances, including operating expenditures; the long-range impact of changes to the city's revenue stream and how that may affect operating and capital-improvement budgets; potential options for enhancing city revenue; and short-term and long-term capital needs.
Task-force members presented the group's recommendations at the Aug. 24 meeting of city council's finance committee.
In order for the city to compete and boost the level of services for the community, "we are going to have to look for ways to increase our revenues significantly," said Shawn Ballinger, chairman of the task force's revenue subcommittee.
With federal and state revenue for cities likely to decrease, "the city is going to have to pick up any shortfall long-term for us to continue to grow and increase our standard of living in our community," he said.
If the income tax had increased from 2% to 2.5% early this year, before the COVID-19 pandemic, it would have meant an additional $6 million in revenue, Ballinger said. The numbers would be a little less now.
The city has not adjusted its income-tax rate since the early 1980s, he said. The 2.5% rate is in place in Columbus and several other central Ohio municipalities.
Finance Director Mike Turner told the subcommittee that about 80% of such an income-tax increase would be borne by non-residents who work in Grove City, Ballinger said.
"There would be little impact on residents who live here," he said. "It would marginally impact those who live and work here."
Grove City increased taxes in the early 1990s by increasing the inside millage, Mayor Richard "Ike" Stage said.
"The expense at that time was very targeted -- here are the four or five things we want to accomplish over the next two or three years" with the revenue generated by the increase in inside millage, he said.
Up to 10 mills of inside millage is allowed in any taxing district in Ohio. It is not voted on by voters.
If the city were to pursue a ballot measure to increase the income tax, it should also consider developing a plan for the projects the additional revenue would help fund, just as it did when it increased the inside millage, Stage said.
The task force also is recommending the city explore the option of creating a Stormwater Management Utility.
"It's a small tax on water and water runoff which would (mostly) affect large businesses like the Wal-Mart Distribution Center," Ballinger said.
The additional revenue could be used to support maintenance of infrastructure, he said.
The task force also has some recommendations regarding the possibility of building a community center in Grove City.
The group identified several issues relating to a community center the city should explore, including whether the Brookpark Middle School land connected to the Big Splash could be a potential site and exploring public and private partnership possibilities for developing and maintaining a community center.
One potential partner could be the YMCA, but that option might not be feasible, Ballinger said.
The YMCA has partnered with other municipalities to develop a YMCA community center for their residents, said Christina Temple, co-chair of the task force's capital-improvement subcommittee.
"We did meet with the YMCA as part of our due diligence to discuss what resources would be available to us, because it is expensive to maintain the staff and facility of a community center," she said.
The YMCA is going through its own challenges during these times balancing expenses with revenue, Temple said.
It may be the city would have to determine its own financial pathway to developing a community center, she said.
The task force's other recommendations include:
* The city should continue to prioritize maintenance of current infrastructure in future operating budgets and capital-improvement project forecasts.
* Grove City should increase the level of service in the area of Parks and Recreation.
* A sustainability committee will be making recommendations regarding potential green initiatives in Grove City. Those initiatives would need funding and should be considered priorities.
* The city should look for ways to promote a mindful and balanced growth of the community.
* Grove City should prioritize police officer training and enhance and expand resources to meet technological advances in safety and security.