How would a proposed 0.75 percent tax increase affect you?
Further details were released Aug. 29 in a Wellington town hall meeting to discuss Issue 34 on the November ballot.
If approved, the increase would put the village tax rate at 1.75 percent. It would also enact an equal tax credit for those who live in Wellington but work and pay local taxes elsewhere.
Using a $50,000 annual salary as an example, a Wellington resident now pays $500 in annual local taxes to the village. If they happen to work in another municipality, the local tax rate there must also be paid.
Under the proposed plan, however, those residents would receive a total exemption from Wellington taxes so long as the rate in their work community is equal to or greater than 1.75 percent, according to documents released by the village.
If the tax rate in a resident’s work community is less than 1.75 percent, they would only pay Wellington the difference.
For example, someone making $50,000 a year with a work community rate of one percent would pay that community $500 and Wellington $375. That amounts to a yearly tax savings of $125 compared to paying a one percent rate in both communities.
Village manager Steve Dupee has projected general fund deficits of $336,044 in 2019, $402,676 in 2020, $471,873 in 2021, and $543,717 in 2022 in the event voters don’t approve the tax plan.
“The income tax issue will allow us to enhance our investment in our capital infrastructure, primarily street improvements,” he said. “It will allow us to continue to maintain the level of municipal services the community enjoys and desires from its local government.”
Residents will soon begin receiving information about the tax plan with their utility bills.
Village police officers plan to go door-to-door in support of the tax plan. A proposal to move the police station to a new home is largely contingent on voters giving the tax plan their stamp of approval.
Officials have tabbed a plaza located at 147 and 149 East Herrick Ave. as the preferred destination, with combined purchase and renovation costs totaling about $1.5 million.
“Officers should ask where people work when they’re knocking on doors,” said village councilwoman Helen Dronsfield during a Sept. 5 meeting. “If they get people to talk to them, the first thing they should ask is, ‘Where do you work?’ If they say Strongsville, be ready to say that Strongsville has a two percent tax. You can tell that person that if this passes, they will pay less money.”
For those living and working in Wellington, the proposed plan does amount to a tax increase. Mayor Hans Schneider thinks being as direct as possible about that fact is the right approach.
“I had this up on Facebook the other day and someone commented that if you live and work in town, you’re going to pay more taxes,” he said. “I responded, ‘You are correct.’ We’ve been very up front about that. It’s never an easy decision to go to a taxpayer and ask them for money. We understand everybody is crunched. But we feel we need to do it at this time. We’ve been at the same tax rate for 46 years.”
Wellington has operated under a one percent local tax since 1972. Voters rejected a proposed half-percent increase by a 738-297 margin in 2004.
“I think village council today does a much better job of communicating with the public than it did in 2004,” Schneider said. “Support for the plan in 2004 didn’t involve this kind of outreach. I don’t think council, at that time, made a high profile effort to get it passed.”
The new plan would generate $723,000 to $773,000 per year.
Annual revenue from individuals would drop $231,322 with gains coming from withholding ($828,442) and net business profit ($151,251).
Current annual local income tax revenue sits at roughly $1.8 million, with $465,156 from individuals, $1.1 million in withholding, and $183,187 net business profit making up that amount.
The more public forums are scheduled for 7 p.m. on Tuesday, Sept. 18; Wednesday, Oct. 10; and Tuesday, Oct. 30.
Jonathan Delozier can be reached at 440-775-1611 or @DelozierNews on Twitter.