Sylvania tax-cut amount still undecided

10/11/2006

A tax holiday for Sylvania property owners could be approved by City Council next week, but the amount of money residents and businesses would keep in their pockets remains a question mark.

Some elected officials would like to see a more substantial tax break than the amount on the table now, and Councilman Mark Bula said it's possible another proposal could be put to a vote Monday night.

At this point, three different tax cuts have been suggested. The amounts vary - a proposal by Councilman Doug Haynam would save a property owner about $93 per $100,000 of valuation; the proposal recommended by Mayor Craig Stough would reduce taxes by $23 per $100,000 of valuation, and a "middle ground" proposal suggested by Mr. Bula would save $46 per $100,000 of valuation.

So far, council has given the mayor's proposal two of three readings; the vote on the mayor's proposal could occur Monday night.

Councilman John Borell, Jr., said he would support a higher tax cut than the mayor's proposal, but if there isn't enough support for the heftier tax holiday, he would vote in favor of Mr. Stough's recommendation for a 1-mill tax reduction.

Councilman Haynam, who proposed a 3-mill reduction in taxes, said he shares Mr. Borell's position on the tax holiday.

Mr. Bula said he would lobby for more votes to build support for a larger tax cut than the one proposed by the mayor, and asked council members if they could come together and figure out a common ground on a tax break.

He said approving a $20 tax cut smacks of politics, particularly considering that council recently approved a "$100,000 tax cut to a coffee shop." He was referring to council's decision to offer tax incentives in a portion of the Monroe Street business district; some officials have speculated the incentive was offered to entice Starbucks to set up shop in the community reinvestment area.

The city owes it to the taxpayers to consider a more substantial tax cut, Mr. Bula said.

Mr. Stough said he thought his 1-mill reduction plan was common ground, adding that that's why there are enough votes to pass it. He said he thinks that everyone should have as big of a tax cut as possible, but emphasized that the city needs to do what's prudent. It's possible another tax cut could be implemented next year, depending on the city's finances, the mayor said.

Mr. Bula, who said he appreciated that the mayor came forward with a tax cut proposal, and some other council members have pointed out that the city has a surplus above the $15 million recommended in the financial and debt policy approved recently by council.

The city's surplus funds total roughly $34 million, Mr. Haynam said, and that means, he said, the city clearly has the financial resources for the tax cut as he proposed.

"I understand that people want to be cautious and careful," Mr. Haynam said. "Clearly we had the financial resources to do a tax holiday last year and didn't do that. I thought we would be cautious and careful now to forego collecting $1.3 million now."

Under the mayor's proposal, the city would forego collection of about $430,000 in taxes.

There would be a unanimous vote for the 1-mill reduction, Mr. Haynam predicted, but he said that "I think we can do better for the taxpayers. I think we could do a lot better."

But, he said, he wants "to see us get something done. I wouldn't vote against the smallest tax cut. I think it's a little cheap, but I am not going to cut off my nose to spite my face."

Contact Janet Romaker at:

jromaker@theblade.com or 419-724-6006.