Where you live does not matter when it comes to Pickerington’s proposed income tax increase because what matters is where you work.
If voters approve Issue 14, people who work in Pickerington would have their income tax rate doubled.
The increase would not affect city residents who work outside of Pickerington in cities that collect at a rate of 1.5 percent or higher because a corresponding credit would also increase from 0.5 to 1.5 percent.
For example, people who work in Columbus, but live in Pickerington currently pay Columbus a 2 percent income tax and pay Pickerington a 0.5 percent for a total of 2.5 percent – that would not change.
However, people who work in Pickerington, regardless where they live, currently pay the city a 1 percent income tax. If Issue 14 passes they would pay 2 percent.
The city estimates only 20 percent of residents actually work in Pickerington, therefore most residents would decide whether or not to double someone else’s taxes.
Without new revenue the city will either cut services or fall into debt.
Pickerington City Council decided against other revenue sources such as a property tax levy because it would impact every household.
Pickerington began collecting income tax in 1976 and has never increased the amount despite having one of the lowest rates in central Ohio, said Pickerington City Manager Tim Hansley.
"The city has changed dramatically in that time," Hansley said. "Residents have never voted on a city income tax, they have voted on school taxes, but that is totally different."
The Pickerington Local School District collects a 1 percent income tax in addition to revenue generated from various property taxes.
Issue 14 would raise approximately $3 million a year for the city.
Without additional revenue, Pickerington may default on loans. The city needs to spend $1.5 million a year to reduce its $30 million debt, a large portion of which was incurred to expand Diley Road.
Finance Director Linda Fersch said if the income tax increase does not pass,
Pickerington would most likely fall behind on its loans by 2010.
Cuts would be made in 2009 to prepare for the lack of funding.
"We don’t want to wait until the axe falls," Fersch said.
The Pickerington Police would receive $300,000 per year to maintain its current level of service given increasing costs such as health care and gasoline.
According to the city Web site, the police department "is the single greatest use of the general fund."
"If Issue 14 does not pass, the city would almost certainly have to reduce the size of our police force in an effort to stay within the funding limits currently being provided by our citizens," the Web site states.
The city would set aside $800,000 for street maintenance, $200,000 for the parks department, and $200,000 for grants.
Pickerington recently missed an opportunity to improve the Refugee/State Route 256 intersection because ODOT required that the city provide matching funds, Hansley said.
If the issue does not pass, city council would "very likely" pursue a property tax increase to support the police department or street maintenance, or both, the website states.
The Web site: www.Pickerington.net provides additional information on the proposed tax.
