ELYRIA — Tax talk time is coming, but it will have to be a quick discussion if the city wants to get an issue on the November ballot.
Mayor Holly Brinda said she likely will recommend Council seek a .25 percent income tax increase. Specifying what it’s for, such as safety forces, is still up for debate.
The city has until 4 p.m. Aug. 6 to place an issue on the ballot.
The city for several years has sought ways to fund the Fire Department after a federal grant paying for 23 positions expires. In less than a year, the city can pay for the salaries and benefits of 52 firefighters — not the 75 positions they have now thanks to the grant.
“I don’t like to put a number on safety, but I don’t want to go back to that number,” Brinda said. “I believe the most conservative number to go with is 65 firefighters, but that requires additional funding.”
Brinda said the Police Department needs more funding as well. It is funded to have 85 positions — although the roster now sits at 79. Brinda hopes to fund and fill 90 police officer positions.
The discussion will start at the June 30 Finance Committee meeting, where City Council members will review four financial scenarios presented by Brinda earlier this year. If they can choose one, a vote could take place as early as July 7. The next regular Council meeting after that is Aug. 4.
Such late-in-the-game movement is not appreciated by some.
“The last time we did this (in 2010), we discussed our options early on and made up our minds by the spring,” said Councilman Mark Craig, I-4th Ward. “Some of us said no, but we at least had the time to talk and have public discussion.”
In 2010, Mayor Bill Grace and City Council — aside from Council members Craig, Mary Siwierka and Garry Gibbs, who all voted against putting an issue on the ballot — made the decision before Council started its summer schedule of one meeting per month.
That plan was to increase the city’s income tax rate from 1.75 percent to 2 percent, with more than half going to the Police Department.
Council President Mike Lotko, D-at large, said a tax discussion was not on the Council agenda before now because he was waiting for the administration to come to him with a recommendation gleaned from various stakeholders.
“This can’t come from just Council or just the administration,” he said. “History has shown that does not work. Voters want to know there are more than just us who believe a tax is the right approach for the city to take.”
Craig said he doesn’t think he could favor a tax issue this year as well. Income tax revenue is down, and he feels as if Brinda has not been focused enough on what he calls her first priority — economic development and job creation.
“She has spent three years doing everything but that, and now we are going to go back to residents to say we need more money. It will be a hard sell,” he said.
Finance Director Ted Pileski said income tax collections are down 4.36 percent compared with the same time in 2013, which was a year when income tax collections jumped a modest 5.91 percent from 2012.
“I anticipated a little bit of revenue drop because tax on net profits were up in 2013, and that often means rebates the following year from overestimates,” he said.
Pileski said cuts by the state to the local government fund and estate tax have put those revenues at the 2009 level.
There has been some speculation that the city might attempt to roll back the 100 percent income tax credit afforded to Elyria residents who work outside the city to boost revenue. Brinda said 68 percent of Elyrians work outside of the city.
The only way Elyria collects income tax revenue from non-residents is if they work in a city with a lower income tax than Elyria, which is nearly unheard of — Elyria has one of the lowest income tax rates in the region.
Craig said any talks of scaling back taxes would receive stiff opposition.
“There seems to be some belief that it will be easier to gain some type of tax credit reduction and double tax some of our residents instead of passing an income tax increase,” he said. “So, basically, the majority of our residents would be penalized for the fact the city doesn’t have jobs inside the city.”