By Timothy Mattackal
On November 7, residents of Cedarville will have the opportunity to vote on a measure to renew a tax levy for workers in the village. Two years ago, the village council proposed a temporary .25 percent increase on Cedarville’s municipal individual income tax, taking the rate from 1 percent to 1.25 percent. That tax levy is due to expire and is up for renewal.
While this extension requires those who work in Cedarville to continue to pay the higher tax rate, it would also allow the village to provide important services to its residents. According to Mayor Bob Fudge, the extension of the tax levy is necessary to allow the town to adequately serve its residents. Up until four years ago, Cedarville was receiving more than $100,000 every year from the state government to assist in funding their budget. When these payments were discontinued, municipalities such as Cedarville were forced to look for alternative sources of income.
“A loss of 10 percent of our annual budget made it impossible to continue to provide the services we were providing without the increase,” Fudge said.
Nathan Martindale, a seven-year veteran of the village council, says that Cedarville followed the example of other municipalities when enacting the tax increase.
“The state did cut funding to local municipalities, not just Cedarville but across the state,” he said. “Tax increases were widespread at the local level in the last five years. We were just a little bit late in the game when we enacted our tax increase two years ago.”
According to Fudge, the voters are being given a choice between having adequate public safety services, such as a functioning police force and ice-free streets in the winter, and keeping .25 percent of their income.
“The police force and salting the streets are the two primary safety-related services which the city provides which could be impacted if we did not have this tax levy,” Fudge said.
The extension of the tax levy will affect everyone who is employed within the boundaries of the city, including people who are employed by the university. Faculty and staff are most affected by this, but students who work on-campus also pay the tax.
“There’s no new tax that is going to come out,” he said. “Whatever you were paying in 2017 will be the same thing you pay in 2018.”
Fudge sees the tax as a necessary measure to allow the village to maintain the services which it provides instead of as an opportunity to collect additional revenue. This means that the issue of where this temporary tax increase will lead in the future is contingent on policies at the state level. Fudge still hopes that the state will revert back to its previous policy and provide funds for local governments again. However, this hope depends on the nature of the new administration which will be taking office in Columbus after the elections next year.
“We’re doing a three-year temporary tax in the hope that when the new administration comes in, they start to flow local government funds back down to municipalities,” he said.
Martindale, while remaining hopeful, is skeptical of the state’s willingness to resume payments to local governments.
“They [local governments] were very vocal about their displeasure and the situation has not been changed,” Martindale said. “They have a budget at the state level to take care of, and if the budget stays the way it is at the state level, we are not too optimistic that they will change how much they give us.”
Fudge states that the plan, if they do not receive funds from the state, is to assess the situation in three years and make a decision on whether or not to ask voters to make the tax permanent.
“If the funds don’t come, we would have had a five-and-a-half year temporary tax that could turn permanent, but that’s a decision we will have to make three years from now,” he said.
Fudge adds that despite the possibility of the increased rate becoming permanent, he can’t see it increasing any higher than 1.25 percent in the near future. Ultimately, it will be up to the voters to decide whether the value of the services which are provided are worth paying a higher rate of income tax for.
Timothy is a senior finance and accounting major. He enjoys traveling, reading, discussing relevant issues, and listening to Ed Sheeran.
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