Saturday, Apr 21, 2018
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Toledo wins approval to reallocate tax funds

Toledo voters yesterday granted the city greater leeway to use money from its 0.75 percent temporary income tax for operating expenditures rather than capital improvements.

A referendum to change allocation of the tax, which is a part of the city's entire 2.25 percent income tax, was approved by voters.

Mayor Mike Bell said the city now will be able to redirect about $7 million this year from the capital improvements budget to the general fund. He said the change would not adversely affect street repaving plans this year.

"We [will] also be able to bring the tax credit back to 100 percent and reduce the trash fee, which has been a sticking point for some people," Mr. Bell said.

Before the change that voters approved, a third of the revenue from the 0.75 percent tax - estimated at about $45 million this year - had to be allocated to capital improvements. The other two-thirds was funneled into the general fund, where it pays for a portion of the city's police and fire operations.

Mr. Bell said the city was able to have a balanced 2010 general fund budget without the $7 million from the capital improvements budget. That money could not be included in the 2010 general fund budget by the March 31 deadline because voters could have rejected the idea.

Mr. Bell and Toledo City Council instead used a combination of measures, including forced union concessions, a higher trash fee, and spending cuts, to address a $48 million general fund deficit.

Part of the city's increased revenue stream came from a bump in the monthly trash collection fee to $15.

With passage of Issue 5, the Bell administration said the trash fee would be lowered to $5 for seniors with homestead exemptions and $8.50 for Toledoans who recycle. People who don't recycle will still pay $15 a month.

Passage of Issue 5 also ends the increased income tax paid by people who live in Toledo but work outside of the city, Mr. Bell said.

The mayor, who is to be in New York today for a meeting with the city's bond rating agencies, said he plans to restore the city's general fund surplus.

"We have to get that rainy-day fund back up to where it should be," he said.

In approving Issue 5, voters also allowed about $748,000 to go back to members of Toledo Firefighters Local 92.

The union on March 25 agreed to concessions that gave the city $3.08 million. With passage of Issue 5, the concessions are rolled back and firefighters would get a refund on the money they paid for their own pension savings.

Councilman George Sarantou, chairman of council's finance committee, said he was grateful voters will allow the city use some capital improvement money for general fund services - chiefly police and fire.

"This will enable us to maintain our number one responsibility, and that is to maintain public safety," Mr. Sarantou said.

Contact Ignazio Messina at:

or 419-724-6171.

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