Springfield to ask voters for income tax increase in November

City commissioners voted unanimously Tuesday night to place a five-year, 0.4-percent earned income tax increase on the Nov. 8 ballot.

If approved, the tax would generate an additional $6.7 million annually. For a worker making $30,000 a year, the tax would cost an additional $9.75 per month.

“There’s no one up here who wants to ask for this, but if we don’t, it’s going to be serious,” Springfield City Commissioner Kevin O’Neill said.

>>RELATED:$125K study to analyze Springfield’s finances

>>MORE COVERAGE: Springfield residents split on take hike, support grows if facing cuts

The city hasn’t mismanaged money, he said, rather has faced a perfect storm of not enough people working in Springfield and $5 million in cuts to local funding from the state government.

“The bottom line is you can only do what you can do,” O’Neill said. “We have to get behind this.”

Every city in Ohio has seen similar budget issues due to state cuts, Mayor Warren Copeland said.

“We’ve tried to do everything possible not to get to this day,” Copeland said. “The reality is if this doesn’t pass, we’ll have to cut services, primarily safety services.”

A recent poll conducted for the city showed voters are split on a tax hike, but favor it more if it avoided cuts to services.

The income tax makes up about 78 percent of Springfield’s general fund revenue.

Springfield is expected to collect about $38.1 million in total general fund revenue next year, less than the city operated with before the recession hit 10 years ago.

If the income tax increase is approved, most of the new money would replace recent cuts to state funding and allow the city to maintain current services, City Manager Jim Bodenmiller said.

The money will also allow the city to maintain funding for the National Trail Parks and Recreation District, as well as keep both Fire Station No. 5 and the police substation on Johnny Lytle Avenue open.

An additional $2 million would go toward a street improvement fund. The rest would pay for a Safe Streets Task Force, a special police unit to combat violent crime and heroin abuse. More permanent improvement money will also allow the city to update its aging police and fire fleet.

“Those will enhance services,” Bodenmiller said.

Earlier this year, a resident-led advisory group analyzed the city’s budget, which faces as much as a $930,000 shortfall this year. The panel made several recommendations last month, which included increasing the income tax rate from 2 percent to 2.4 percent for five years.

>>DETAILS:Springfield projected to collect $38.1M next year

The city and chamber have agreed to pay $125,000 for an independent study of the city’s finances. The performance audit is expected to be completed by the end of September, Bodenmiller said. The recommendations will also be part of the budget process in the fall, Copeland said.

City commissioners also approved a 10-year, 75-percent tax abatement for a proposed distribution center for medical supplies that could bring 70 new jobs to Springfield.

Tiffin, Ohio-based Seneca Medical is planning to build a new 150,000-square-foot distribution center for a total investment between $16.3 million and $18.8 million. The distribution center will be the first major development for the new PrimeOhio II Industrial Park along I-70.

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