Toledo Mayor Bell scraps quest for vote to raise city income tax

'I think we all agree we don't want to raise taxes,' Mayor Mike Bell told Toledo City Council on Tuesday. 'It's not ideal.'

Mayor Mike Bell yesterday pulled his request for voters in May to increase the city's income tax and instead offered a number of other measures to help balance a $48.2 million deficit.

“I think we all agree we don't want to raise taxes,” Mr. Bell told Toledo City Council yesterday. “It's not ideal.”

Council last night followed the mayor's lead and did not vote to place the referendum on the ballot.

The increase would have bumped the total tax to 2.5 percent from 2.25 percent and would have generated an extra $7.5 million beginning July 1 through the end of 2010.

Mr. Bell said he did not know if the tax increase would have been approved and added that it did not affect his decision to withdraw the question.

His alternative plan leaves a $1.17 million surplus for the 2010 general fund deficit but it does not address the $12.77 million carryover deficit from last year.

That still leaves the city with a shortfall of $11.6 million in its general fund.

Mr. Bell said the city would continue to cut costs and pursue the sale of city properties like The Docks or land in Monclova Township to help reduce the deficit. “We can probably come up pretty quickly with $11 million,” he said.

Council did not vote last night on any of Mr. Bell's other budget-fixing ideas.

Mr. Bell wants council's approval to eliminate 100 percent of the tax credit for Toledoans working in other locales, a move that would generate $8 million this year in new revenue.

A majority of council opposed then-Mayor Carty Finkbeiner's proposal last year to cut that credit by just 50 percent, which would affect more than 19,000 Toledoans.

Councilmen Mike Craig and Wilma Brown were the only two last year still on council this year who said they supported the idea.

To raise an additional $2.7 million, Mr. Bell also wants to delay refuse-fee discounts for recycling that are scheduled to kick in this year.

The mayor's proposed cutbacks include eliminating pension pickups and having city employees pay 20 percent of health-care costs.

Mr. Bell said he is waiting until Feb. 25 for an answer from city unions on the requested concessions.

Steve Herwat, deputy mayor of operations, says Toledo will still have a capital improvements plan budget. The city is required to have a balanced 2010 budget by March 31.

The mayor has taken his proposed 10 percent wage cut for city employees off the table.

“We did a study and our employees are not overpaid,” Mr. Bell said. “We are actually very lean.”

The mayor also wants to save $52,000 in police and fire overtime costs by canceling the July 4 fireworks celebration.

The Blade last year was a major sponsor of the two-day Red, White, and Kaboom July 4 weekend event, which capped off with a fireworks show.

Among the items outlined in Mr. Bell's plan are adding positions to the law, finance, and taxation department to collect delinquent tax collections and negotiate better vendor contracts.

The plan also calls for elimination of festival fee waivers to raise $50,000 and implementing an events tax to generate $600,000.

Council did vote 12-0 last night to ask voters in May to give the city much greater leeway over how a separate 0.75 percent income tax is spent.

With that, he will be able to divert more money from capital projects to operational costs such as police, fire, and refuse.

That tax is part of the city's entire 2.25 percent income tax.

Deputy Mayor of Operations Steve Herwat said the city would still have a capital improvements plan budget and resurface 30 miles of streets.

The city must have a balanced 2010 budget by March 31.

The Bell administration said this week that it is willing to spend up to $250,000 to have the Ohio Auditor's Office perform a breakdown of the city's finances in the next three to six months, in hopes that such a study could help the city reduce its projected $48.2 million general fund deficit.

The audit is under consideration because the new administration believes the city's finances are upside-down even though the municipal work force is among the state's leanest for cities its size.

In other business, council yesterday approved settlements totaling $450,000 with two former employees who claimed they were fired illegally by former Mayor Finkbeiner.

Council voted 10-2 to approve $300,000 for Dwayne Morehead, former co-executive director of the city's youth commission.

Councilmen D. Michael Collins and Tom Waniewski voted no.

Council voted 9-3 to approve $150,000 for Perlean Griffin, formerly director of the Office of Affirmative Action.

Voting against were Mr. Collins, Mr. Waniewski, and Councilman Adam Martinez.

Mr. Morehead and Ms. Griffin filed suit in U.S. District Court in 2008, along with Gary Daugherty, a former environmental services manager, alleging racial discrimination and unlawful termination in 2007.

All are African-Americans. They asked $1 million each in compensation. The Daugherty case is scheduled to begin in April.

Contact Ignazio Messina at:imessina@theblade.com,or 419-724-6171.