Thursday, May 24, 2018
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Painful budget choices

THE outcry against Mayor Carty Finkbeiner's proposal to help balance the city budget by reducing the income-tax credit for people who live in Toledo but work outside the city was pretty much expected.

Still, the vehemence of the reaction, and City Council's subsequent rejection of the mayor's plan, does not change the fact that Toledo has a serious and growing budget shortfall that will have to be addressed, and that addressing it will be painful and unpopular.

Dozens of people showed up at a council meeting Tuesday to complain that the mayor's plan to generate more than $5 million in new revenue by cutting in half the current 100 percent tax credit enjoyed by Toledoans who work in Oregon, Perrysburg, Maumee, and elsewhere was not fair and would force them to move out of the city.

Realistically, most of the 19,200 people affected aren't going anywhere because in this housing market they'd never be able to sell their Toledo homes, but that's not really the point.

The mayor's plan was dead from the moment it was unveiled because Mr. Finkbeiner made council members feel like outsiders in the process. He didn't make matters any better after the fact by calling council members cowards and declaring that because they didn't like his idea they're responsible for whatever bad happens in the future.

To be sure, council won't win any "Profile in Courage" awards for summarily folding when confronted by about 100 - out of nearly 20,000 of those affected.

But was the tax proposal a bad idea? Not really.

Several local communities, including Bowling Green, Ottawa Hills, and Perrysburg, allow residents who work elsewhere only a 50 percent income-tax credit. The rationale is that people use the services of the municipality where they live to a much greater extent than they do the services of the place where they work, so that's where the bulk of their taxes ought to go. If that makes them feel put upon, they should storm council chambers where they work, demanding to know why they should pay for what Mayor Marge Brown had the audacity to call the "privilege" of working in Oregon.

In addition, there are hard realities that Toledo residents are going to have to face and difficult choices that will have to be made.

Tax revenues in 2008 dropped much more than expected, creating a hole in both the 2008 and the 2009 budgets. By law, those holes must be filled.

According to two University of Toledo professors, 2009 income tax revenues could be as much as $20 million less than even the city's worst current projection, which means everyone should prepare for even more cuts.

And despite complaints about Mayor Finkbeiner's penchant for planting flowers, the evidence is the deficit is due to the sudden revenue decline, not the city's living outside its means in any significant way. There is little fat left to trim from 2008 or 2009, meaning future cuts will tear into the meat and muscle of city programs and services.

What will the "don't tax me" folks want to cut? Shall council cut back on police patrols or fire protection? These are two of the most expensive items in the city's budget. And who could blame the majority of residents - who both live and work in the city - for complaining that their taxes shouldn't subsidize people who pay less because they work in Oregon or Maumee?

Mayor Finkbeiner and council are going to have to find ways to increase city revenue. However they accomplish that, it is likely to appear unfair to one group or another. But in the end, all will share in the pain.

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