The city of Dayton plans to ask voters to approve a 0.25 percent income tax increase that supporters said will help close a projected shortfall, fund police and fire services and pay for universal pre-school.
While Dayton voters will decide if the increase takes place, the tax is paid by people who work in the city.
If approved, the tax rate would climb to 2.5 percent for a period of eight years.
>> COMMENTARY: Mayor Whaley says plan ‘fair, accountable and necessary’
The additional 0.25 percent would generate about $10.5 million annually and cost someone who works in the city and earns a $35,000 salary an additional $83 each year, city officials said.
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The tax increase will help close a $5 million funding gap. It also will pay to maintain fire services, add about 20 police officers, roughly triple the amount spent to pave and resurface residential roads, improve parks and better maintain vacant lots, said Shelley Dickstein, Dayton’s city manager.
About $4 million of the annual revenue will be put toward providing universal access to high-quality pre-school for all 4-year-old children citywide, she said.
News of the proposed tax increase provoked some negative reaction on social media, including from former Dayton Mayor Gary Leitzell.
He said the city should cut spending instead of increase taxes.
“We need to focus on doing things that attract residents,” he told this newspaper, “not things that would make people want to leave.”
Leitzell was defeated by Mayor Nan Whaley after serving one term.
City commissioners next week expect to introduce legislation to put a measure on the November ballot.
The city is earning the same amount of money as it did in 1998, which is insufficient to sustain current service levels and pay for strategic investments, Dickstein said.
“We’ve been good stewards for the tax dollars, but we can’t make ends meet on 1998 revenue levels,” she said.
Dayton’s income tax rate last changed in 1984, when voters authorized increasing it to 2.25 percent from 1.75 percent.
Dayton voters in 2014 overwhelmingly supported making the 2.25 percent rate permanent.
The city projects it will take in about $158.5 million in revenue this year.
The city projected earlier this year would end 2016 with expenses exceeding revenue by $3.4 million and projects a $5 million shortfall next year.
Expenses are rising and revenue has not kept pace, especially because the state has reduced funding support by $40 million since 2011, Dickstein said. She said the city has cut 700 jobs from the payroll since 2007.
The city faces more cuts unless it increases revenue, she said.
The increase will pay to maintain current fire and emergency medical service levels, and it will pay for up to 22 more police officers over six years, Dickstein said. The city has about 325 sworn police personnel.
The city also proposes increasing annual spending on repairing and paving roads to $4.7 million from $1.3 million.
The city would pave 73 lane miles of residential roads each year, compared to 20 right now, which would result in every residential road being in good condition by the end of the eight-year period, Dickstein said.
Dayton is home to about 1,028 lane miles of road.
About $4 million of the funds will be directed toward providing high-quality, universal pre-kindergarten for every child in the city, said Mayor Whaley, who has been a leading advocate of improving access to pre-school.
A demonstration of the “Preschool Promise” program is taking place in Northwest Dayton and Kettering.
The additional income tax revenue would allow the program to expand citywide, benefiting about 1,900 children who are four years old, Whaley said.
High-quality pre-K has been shown to help children read better and succeed in school and learning, she said.
About 80 percent of children in Dayton start kindergarten unprepared, and preventing them from falling behind will have a big impact on later economic success, she said.
“If they learn to read and read to learn, it changes the whole trajectory of the workforce over the next 20 years for Dayton,” Whaley said. “These are the long-term investments that communities and governments are supposed to engage in.”
The city also plans to use the additional revenue to fund the last phase of park improvements and maintain the 5,700 vacant lots in the city’s care, officials said.
The city would mow these lots once a month instead of the current practice of three times a year, officials said. The grass in the city’s major thoroughfares would be mowed more frequently too.
The city’s funding commitment for universal, high-quality pre-school would help provide Dayton’s youngest learners with the foundation they need to succeed later in life, said Robyn Lightcap, director of ReadySetSoar, which launched the preschool promise demonstration.
“This will benefit all of us as we build an educated workforce, which leads to a stronger Dayton and stronger region,” she said.