Council to consider #036;10 fee, reciprocity

Published 12:00 am Tuesday, September 14, 2004

Ironton's $10 municipal fee has become the Rocky Balboa of legislation - just when you think it is down for the count, it pops up again.

When the Ironton City Council meets at 6 p.m. today in the City Center, it will once again consider a $10 per month, per address municipal fee as a way to address the city's $500,000 deficit between revenues and expenditures. Also, council will likely vote on the final reading of a proposed change to the reciprocity income tax agreement.

Many residents spoke up in favor of the municipal fees in the past, but Mayor John Elam's idea for a $10 version has been voted down twice and a $3 fee was nixed once. Councilmen Chuck O'Leary and Jim Tordiff did some adjusting and revived the plan.

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"We need the revenue. A blind man can see that," O'Leary said. "… Of everything that has been proposed, this is the fairest way because it affects each family."

O'Leary believes it is the best solution because the plan that would generate approximately $550,000 per year would hit everyone, while an income tax increase would only affect 40 to 60 percent of the people and a reciprocity change would affect a smaller percentage within that group.

In the past, some concerns were voiced over the legality of a municipal fee because revenue did not go to a specific line-item in the budget. To address that, the ordinance was reworked so that revenue generated would go the salaries and benefits line item in the Police Department, thus allowing the general fund to save an equal amount.

"This plan frees up money to bridge the gap in the budget and possibility look towards economic development," O'Leary said, emphasizing that it would not affect the police department staffing at all.

Overall, O'Leary said he believes that the people have let their voices be heard on the issue and that they overwhelmingly supported this fee. Now he just has to convince the other five members.

"This will never happen again in our lifetime," he said. "The taxpayers will never again come and say, 'Here, take my money.'"

The other councilmen have each opposed the fee for various reasons. Most are just not convinced that this is what the people want to see happen or that it takes into consideration the people with low or fixed incomes.

"Basically, it is the same thing that was presented before and I don't support it now for the same reasons I didn't support it then," Councilman Bill Nenni said, explaining that it would be a burden for many people in the city. "I just think we are asking the wrong people to pay."

Nenni also called the new structure of where the money goes almost deceiving.

"I think it is terribly misleading. One of the problems with the fee all along was where the money was going to go and what it was going to be spent on," he said. "Now, we are saying we will spend it (in police), but where will we spend the money that won't go into the fund?"

The other financial fix on the table is a 50-percent reduction of the reciprocity agreement that affects how residents working elsewhere pay their income taxes

According to Ohio law, employees pay an income tax where they work, but if there is no income tax there, they pay where they live.

If the plan that would generate approximately $320,000 in a full year gets approved, Ironton residents who work in neighboring municipalities with an income tax, such as Portsmouth or Ashland, Ky., would also have to pay half of Ironton's income tax. Currently, those individuals are not required to pay anything to Ironton.

"The reason I think this is a good plan, as opposed to the $10 fee, is that it does not affect many people with little or no income," said Nenni, the ordinance sponsor. "The people affected by reciprocity don't pay any city income tax because they work outside the city of Ironton.

"I don't think that absolves them from paying in some form to the city of Ironton," Nenni said, adding that these people still live here, send their children to school here and rely on city services such as police and fire protection."

Rusty Mittendorf was an Ironton resident who spoke against the reciprocity change recently, even though he would not be affected by it.

"The way they are going to tax people won't be fair," he said. "… These people are already paying a fair share, maybe not to this community, but they are paying their fair share of taxes."

Some residents are angry

because they are already paying two sets of taxes. Residents who pay Boyd County's 1-percent tax, but work outside of Ashland, are required to pay Ironton's 1-percent tax because the reciprocal agreement only applies to municipalities.