WARREN - City officials are expected to support an effort to stop the state from taking over the collection of income taxes from cities.
Treasurer John Homlitas told City Council members that the state's effort to provide municipal tax uniformity would cause the city to lose $1.25 million a year and impose collection fees of about $350,000.
"It also would require the city to hire a tax administrator and a resolution officer," Homlitas said. "In addition, it would add a burdensome and complicated audit process."
Homlitas said the estimated $2.5 million the city could lose due to the passage of House Bill 601 represents the salaries of 25 safety officers.
Mayor Doug Franklin expressed resentment of the bill because it gets involved in the city's ability to collect its own taxes and manage its own budgets.
"We have been able to keep our budgets balanced, even when the state cut the amount we receive from local government funds and the accelerated phase-out of the tangible personal property tax,'' Franklin said. ''The state has not."
Franklin said the Ohio Municipal League has offered amendments to the proposed legislation that would have kept it revenue neutral, but the efforts were ignored.
Representatives Cheryl Grossman, R-Grove City, and Michael Henne, R-Clayton, introduced HB 601 in October to create uniform rules for income withholding and taxation among all Ohio cities.
The bill seeks to institute uniform deadlines and definitions for the municipal income tax, but does not impose centralized collection. The sponsors have stated that uniform rules will make Ohio's business climate more competitive by reducing businesses' administrative costs in preparing and filing tax returns with multiple cities.
"We are not against having a simplified tax collection method," Councilman Eddie Colbert, D-7th Ward said. "We are against taking the control of the collection back to the state. It could cost our city more than $1 million in tax revenue."
"We are already losing state and federal funding," he said. "To lose more money would be detrimental to the city. There is not a problem with tax collection in the city of Warren. That is not a complaint that I've heard before.''
Councilwoman Helen Rucker said she hopes that the city passes a resolution against the proposal.
"This is a piece of legislation that is hurtful to cities," Rucker said. "Once this passes here, I'm going to ask that this be taken to other cities, so they can use our legislation as a model to what they can pass.''