The 0.5 percent income tax brings in a substantial amount of revenue for the city, Moraine City Manager Bryan Chodkowski said. Without it, Moraine residents might have to start paying fees on certain services, Chodkowski said.
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Services currently covered by the more than $3.5 million the 0.5 percent income tax brings in every year include waste collection and snow removal for the elderly and disabled, Chodkowski said. The money is also used to maintain streets, lights and sidewalks.
“Our residents get a lot for what they pay,” Chodkowski said.
Voters supported the 0.5 percent tax hike four years ago, which increased the total income tax to the current 2.5 percent.
Ballot language could have played a role in the measure’s failure. The plan was to allow the current five-year rate increase to expire in 2019 and have the permanent 0.5 percent renewal take effect after that, Chodkowski said. The total income tax rate would have remained at 2.5 percent.
The ballot language, however, read that there was an “additional” 0.5 percent increase, so voters may have thought the rate was set to increase again, Chodkowski said.
“They probably didn’t realize they were continuing the current half percent,” he said.
Having a permanent income tax would allow the city to better plan for future state and federal funded projects, Chodkowski said. Many of those projects are planned years in advance, and municipalities must match funding in order to receive federal and state funding the projects.
“It enables us to plan more accurately,” Chodkowski said.
Keeping the income tax hike enables property taxes to stay low, Chodkowski said, which can help lower-income residents and acts as an incentive for businesses to move to Moraine.
Chodkowski said he and Moraine City Council members have discussed putting a similar measure on the May ballot. Council members will have until their Jan. 24 meeting to put the measure on the ballot. It could be either permanent or another temporary renewal, Chodkowski said.
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