Avoid New Cuts For Towns, Cities
State law regulating municipal income taxes in Ohio ought to be uniform and fair. That should go without saying.
But a bill in the General Assembly to alter the rules by which towns and cities levy and collect income taxes may reduce their revenue from that source. At a time when most Ohio municipalities are struggling with lower revenue, in part because of cuts in state assistance, that is a big concern for local government officials.
St. Clairsville Mayor Robert Vincenzo outlined concerns about the measure, House Bill 607, during a City Council meeting Monday. He explained the proposal is intended to “make (the municipal income tax distribution system) more uniform, and also to cause a lot of loss of revenue.”
Vincenzo’s assessment is backed by the Ohio Municipal League, which warns enactment of HB 607 “would result in significant revenue loss for Ohio’s municipalities …”
Exactly how much revenue towns and cities would lose through enactment of the measure is unclear. Vincenzo told council he is preparing a resolution in opposition to the bill, to include information about how much it would cost St. Clairsville.
Most East Ohio communities have municipal income taxes, though there are a few exceptions. Revenue from that source is critical to balancing budgets in many towns and cities. In some, such as Mingo Junction, which is in the midst of a budget crisis, loss of much municipal income tax revenue would be a severe problem.
Balancing the needs of taxpayers, including job-creating businesses, with those of municipal budgets is tricky business. Again, tax burdens should be fair, uniform – and as low as possible.
But placing a new revenue loss burden on the backs of already stressed local governments may not be a good idea, especially now. State legislators should bear that in mind before acting on HB 607.