Proposed increase of temporary income tax from ¾% to 1%

Mayor Paula Hicks-Hudson is proposing increasing the temporary income tax from ¾% to 1% as part of the solution to make needed repairs for city streets.
Mayor Hicks-Hudson will have a new ordinance regarding the suggested 1% temporary income tax for council’s consideration December 8 at its regular meeting at 4 p.m.
Council needs to approve any ordinance prior to December 15 for the issue to be put on the March ballot for voters.
The temporary income tax is 1/3 of the total income tax revenue generated for the City of Toledo.
Projected revenues from the 2016 total city income tax as it stands today (with ¾%) is expected to be $167 million.
From the 2016 total city income tax, $55 million is generated from the ¾% temporary tax.
If voters support the 1% temporary tax in March, the City would have $8.3 million for streets and capital projects in 2016 rather than zero. This is because collections would be for only one-half the year, starting July 1. (The additional ¼% increase would be restricted entirely to Capital Improvement Projects.)
However, for the next four years, the City would have $16.6 million to be placed directly into the Capital Improvement Fund for streets and capital projects .
The City would be able to reduce its 2016 CIP transfer from $10.4 million to $5.2 million and eliminate CIP transfers entirely after July 1, 2016.
To someone with an income of $35,000, the new ordinance to eliminate CIP transfers and fund streets would mean a $7.29 a month income tax increase.
City Council President Steve Steel has called a Committee of the Whole meeting Friday, December 11 at 1 pm to review detailed information the administration is preparing about the impact of the new ordinance.
A Special Meeting of Toledo City Council will follow at 2 pm to act on the matter.
If approved, this legislation will be put before the voters in March.

Posted by Stacy Weber on Tuesday, December 08, 2015