Council OKs tax holiday

10/18/2006

A tax holiday is on the calendar for 2007 for Sylvania residents and businesses.

Sylvania City Council unanimously approved the tax break during its meeting this week, a session that was marked by the sharp exchange of words among the elected officials.

Council's decision means that the city won't collect $430,000 in property taxes next year. This will reduce a property owner's taxes by $23 per $100,000 of valuation. After the meeting, Mayor Craig Stough, who suggested this tax-break version, said he was thrilled that Sylvania will see a citywide tax holiday.

A substitute proposal by Councilman Doug Haynam, who has been trying to drum up support for a tax holiday for months, was rejected on a 4-3 vote earlier in the meeting. Originally, Mr. Haynam backed a plan that would save a property owner $93 per $100,000 of valuation next year, but on Monday night he asked council to consider a "middle ground" version to cut taxes by 2 mills, saving a property owner $46 per $100,000.

Voting against that middle-ground proposal were councilmen Read Backus, Keith Haddad, Mark Luetke, and Council President Barbara Sears. Voting yes were Mr. Haynam, John Borell, Jr., and Mark Bula.

Mr. Bula had asked for support for Mr. Haynam's tax-cut proposal, noting that the city has $23 million in the bank, far above the $15 million ceiling the city has set. With that amount of surplus, he said, it might not matter a whole lot to the city if the tax holiday was for $440,000, $800,000, or $1 million.

Mayor Stough defended the 1-mill holiday when council members later were discussing an issue related to a new water line along Boynton Drive. Residents have complained that the water line and street improvement project has caused safety concerns, neighborhood disruptions, and other problems. In particular, residents objected to a $2,500 cost recovery fee that the city planned to charge each property owner.

Residents contended that Mr. Stough, in his Mayor's Message in March, stated that the city would be improving neighborhood streets this year, including Boynton, and that the improvements would not mean property assessments. The mayor said he meant no assessments for street improvements, but did not exclude the water line. However, the Boynton residents argued that no assessments means no assessments, and that the $2,500 cost recovery fee for the water line was an assessment. Council agreed, and Monday night they voted to waive the fee for Boynton Drive residents. This, some officials said, will mean a loss of $65,000 in revenue.

Mr. Bula, who didn't reply two weeks ago when Mayor Stough said this council's actions are costing the city money because the administration is spending more time on various issues, blamed the administration for the costly Boynton Drive error. Mr. Bula noted that problems related to a drainage pond in Harroun Community Park was another error, and he said he wanted to make it known that another administration mistake was again costly to the city.

Mayor Stough responded swiftly, saying that council buckled on the Boynton Drive assessment situation, and alleged that some on council were pandering for votes. He said he took issue with Mr. Bula's accusations, and noted that nothing in official city records specified that Boynton Drive residents would not have to pay the $2,500 fee. Council, he said, is changing the rules regarding assessments that others in the city have paid. The mayor pointed out that the tax holiday is possible because the administration does not make errors.

Mr. Haynam said council was influenced by the Boynton Drive residents' complaints about the street improvement project, and said perhaps this project wasn't the city's best effort.

Mayor Stough pointed out that residents used to be assessed for street improvement projects, but the city has picked up the cost for about nine years. Some problems cropped up on the Boynton project because outside firms did some work; in the future, the city will hire more people to do such work in-house, the mayor said.

Mr. Luetke said the mayor was off the mark to suggest council is pandering for votes. He said the city made a mistake that led Boynton residents to believe that there would be no assessments. It's appropriate, Mr. Luetke said, to "do right by our citizens."