Minerva Village Council voiced strong opposition at its Feb. 28 meeting to a proposal in Ohio House Bill 49 that would take away a portion of local income tax from Ohio municipalities, according to information Village Administrator Dave Harp and Village Law Director Clark Battista presented.
Council approved a resolution opposing language in Ohio Governor John Kasich's budget plan for 2017-18, which is included in HB 49, that would centralize the payment of local income tax paid by commercial enterprises.
Currently, businesses can send their municipal income tax returns to the municipalities in which they are located. This local income tax is paid directly to the municipalities.
Although some municipalities pay third-party services to process these returns, Minerva and others audit and process the returns on their own.
Under Kasich's proposal, businesses would instead be required to send their municipal income tax forms, and pay their local income tax, directly to the state's Department of Taxation.
The state would return the local income tax revenue to municipalities. However, according to the budget plan, the state would keep one percent of each municipality's business income tax as an administrative fee for handling the income tax returns.
"We're going to lose one percent of our business tax income," stated Harp.
According to the resolution council passed, Kasich's proposal also includes legislation that would change how business-derived income tax is calculated using the Business Allocation Formula, which would reduce reportable tax revenue that municipalities could receive from warehouses, distribution centers and businesses providing online sales.
The resolution states that eliminating this "throwback" portion of the Business Allocation Formula would go against the Uniform Division of Income for Tax Purposes Act, passed in 1957, which was used to establish the formula and which remains "the standard for Ohio and the United States."
"Municipal income tax is the single largest revenue source which provides essential municipal services, promoting a quality of life that residents and businesses alike rely upon, and any forced reduction in this revenue will have a negative impact on residents and businesses," the resolution continues.
The resolution adds that recent cuts to Local Government Funds, the elimination of estate tax, and the phasing out of other funds allocated from the state to Ohio's municipalities have already "resulted in a loss of revenue to the Village of Minerva" that would be worsened if Kasich's income tax proposal is passed.
"You're going to see a lot of municipalities come out against that," Battista noted.
Council's resolution urges the Ohio General Assembly to remove the income tax language from the budget plan and to promote upcoming changes to the Department of Taxation's online Ohio Business Gateway site, which businesses can use to file their tax returns, while allowing the site to continue remitting tax payments directly to municipalities.
Minerva joins Canton, Marietta, Moraine, Piqua, Vandalia, Union and other municipalities that are fighting the tax measure.
In other business, council:
HEARD Harp report that the Park Board will meet March 13 at 6 p.m.
HEARD Harp present an update about construction of the village's new swimming pool. Harp said council had met with Studer Architects to further discuss renovations to the bath-house restrooms that will make the facility compliant with the Americans with Disabilities Act.
Harp added that he was gathering quotes for installing electrical conduit underground at the pool. Meanwhile, pool design and construction firm Family Fun was preparing to pour cement for the deck area that will surround the pool.
Harp also reported that council had chosen fencing to surround the pool.
DISCUSSED new trees for the downtown area after Councilwoman Billie Rowe asked when the trees will be planted.
"I would like to see those trees done, because we've been pushing this off and pushing this off," she stated.
In response to a question from Councilwoman Becky Stoller, Minerva Mayor James Waller said council can examine spots along the downtown area that have been marked as possible places where the trees can be planted.
APPROVED the second reading of legislation adopting a written policy for the sale or disposal of village-owned property that is no longer needed.
APPROVED the first reading of an ordinance authorizing Harp to sign a contract for the purchase of a 2017 full-size cargo van for the village water department through the State of Ohio Cooperative Purchasing Program at a price not to exceed $43,776 and dispensing with the competitive bidding process. The vehicle may be purchased from Loudon Motors Ford, LLC if the state cooperative pre-bid purchase price can be honored. Otherwise the vehicle will be purchased from Middletown Ford, which is the successful state bidder. The expense for the vehicle was included in the village's budget this year, said Harp.