An initiative petition filed with the Clark County Board of Elections could potentially devastate New Carlisle’s finances, city leaders say, but the woman behind it says residents shouldn’t have to pay income taxes twice.
Residents can be taxed both by the city where they work and, if it’s a different, where they live. Many cities give their residents credit if they work elsewhere but New Carlisle doesn’t.
The petition, filed by New Carlisle resident Kelli Bartlett, would be placed on the November ballot if approved by the board of elections and would require the city to stop collecting income taxes from residents who work and pay taxes in other cities.
About 60 percent of the city’s income tax revenue comes from residents who work outside New Carlisle, according to public records. If the city can no longer collect from them, New Carlisle City Manager Randy Bridge says it faces severe cuts.
“It’s a very serious and very scary time,” Bridge said. “I just hope that voters would not approve this because an extreme case would be the city might have to dissolve and there would be no more New Carlisle and that would be very long down the road but that is a possibility.”
Residents in New Carlisle are taxed enough, Bartlett said. She pays a 2.5 percent income tax in Dayton and she believes it’s not right that she must pay an extra 1.5 percent to New Carlisle because she lives there but doesn’t work there.
She wants New Carlisle to give a 100 percent credit to their residents who work in a different city, as some cities like Columbus do. Springfield gives a 50 percent credit to its residents.
“I am a life-long resident of New Carlisle,” Bartlett said. “This all came up because taxes continue to increase and in New Carlisle, the system seems out of line.”
The elections board will meet on Aug. 21 to review the petition and will at that time decide if it will be placed on the November ballot.
“If (the elections board) validates them, that should be it unless someone requests a hearing with the board to challenge their decision,” Clark County Board of Elections Director Jason Baker said
The petition has about 200 signatures. The petition needs about 150 valid signatures from New Carlisle registered voters to get on the ballot. The board needs to ensure the signatures are valid before officially placing the issue on the ballot.
Bridge sent the Springfield News-Sun documents that showed the city’s general fund is budgeted to pay police operations, road maintenance and other services. The documents show the city estimated collecting $1.6 million in income taxes in 2017, with almost $1 million of it coming from residents who work in another municipality.
“We are not Cincinnati or a big city,” Bridge said. “We don’t bring in a lot to begin with.”
Through conservative spending, Bridge said the city expects to have about $500,000 saved up but that would dry up if it had to give residents credit for taxes paid elsewhere.
“That will be eaten up really quick,” he said.
New Carlisle Mayor Mike Lowery said he hopes if the issue gets on the November ballot, voters investigate what its passage would mean.
“It would put the city on an extremely tight budget,” he said. “How could the city ever make up that much that it would lose?”
He believes some supporters of the ballot initiative don’t understand how it works and what it could do to the city.
“If you told me I wouldn’t have to pay half my bills anymore, that sounds great,” he said. “But if I am going to lose my electric, I wouldn’t want that. The same goes for the city.”
Bridge declined to detail what might be cut if voters pass the issue but said it would likely be wide spread.
“Our police, our staff, we can just assume when you cut 60 percent of your budget you are going to see massive cuts,” he said. “How much we plow roads or how much the city building is even open. We would have to cut our hours down, the ripple effect is going to be humongous.”
By the numbers
$1.64 million: Annual income tax the city of New Carlisle will get in 2017
$984,000: Estimated loss of income tax revenue if potential ballot issue passes
200: Signatures on a petition to put the issue on the ballot
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