ThisWeek CW 12/12/12
Growing concern over Ohio House Bill 601, aimed at consolidating municipal income tax collections under state control, has caused Canal Winchester and Groveport officials to take action.
The legislation, according to Ohio Municipal League documents, would “impose state administration of the municipal income tax and would impose new procedures and restrictions that would cause significant revenue loss to Ohio cities and villages.”
Canal Winchester Finance Director Nanisa Osborn said she estimated H.B. 601 could cause a potential loss of more than $565,000 in revenue for the city.
“I think there are some communities that might not be hurt as much as we would be, but we have a lot of people that come in to work for short periods of time, and this changes the length of time before those people are subject to municipal income tax,” Osborn said.
Currently, Ohio municipalities can collect income taxes on short-term employees after they work 12 days in the community; the proposed new legislation would amend that to 20 days.
Groveport City Administrator Marsha Hall said she, too, has objections to H.B. 601.
“I’ve asked our income tax administrator to provide information on the loss of revenue we could expect pertaining to H.B. 601, the income tax uniformity bill,” Hall said. “I received a letter from Ohio Tax Commissioner Joe Testa, saying the state would be able to collect at a lower rate than the city pays now, but then took several paragraphs explaining what they’d do — and it didn’t add up.”
During a Nov. 27 hearing on the bill, according to the Ohio Municipal League, sponsors said it was unlikely H.B. 601 would receive any further hearings in 2012 but would be reintroduced in 2013.
Canal Winchester City Council voted unanimously Dec. 3 to approve a resolution opposing it.
Hall said she will be asking Groveport City Council to pass a similar resolution in the coming months.
“We’re against the House Bill because of what it will likely cost us,” Hall said. “There are a couple of resolutions that the Ohio Municipal League is asking communities to pass against this House Bill and I’ll bring that back to council as things progress.”