April 23, 2010
ANALYSIS: Restructuring Huntington’s Taxes Now Fill Council’s Plates
Galvanized Debate Must Collectively Turn Challenges into Solutions
By Tony Rutherford
Huntingtonnews.net Reporter
Huntington, WV (HNN) – Having listened and observed a local exercise of government debate extending from the city administration and council members to residents and workers within the Huntington city limits, the “stage” appears set for a yet to be determined final act. Decisions and there are many have mounted on the plates of Huntington City Council members.
Based on the statements of council members both before and after public comment, the draft proposal of the Occupation Tax as valiantly submitted by the administration appears destined for a watery grave in the Ohio River.
And, Finance Chairman Steve Williams appears inspired that the proposal and hearing process have galvanized so many into closely examining their government.
After the meeting, Williams “welcomed the opportunity” for a summit with leaders such as the one proposed by Del. Sobonya.
The metamorphosis of the proposal into a tax reform package --- whether partly preconceived and molded by the tone of public input or not --- the city’s leaders appear to have open minds under the anxiety of the tax proposal.
“We have changed the discussion,” Williams said after the lengthy hearing. “Now that we have changed the discussion, let’s look at the points and see how to fine tune this. What might be wrong with our proposal? I have wanted, Jim Insco wanted, Nate Randolph wanted to change the direction of the debate. It’s not a tax increase; we are re-structuring our tax structure.”
And, Finance Director Deron Runyon conceded that the process represents “the way it is calculated, it is a work in progress,” adding that as components are proposed “we will look at the numbers.”
The tax reform package appears to square with Sobonya’s statement that occupation tax revenue should not be directed (no matter how well intentioned) to the general fund because “all of this can go away [in 2013]” based on the will of the legislature.
And, it addresses concerns of the Huntington Regional Chamber of Commerce. As councilman Nate Randolph stated, “ I cannot support this unless there is a big reduction in other taxes.” Essentially, Randolph declared “don’t use this for a cork in the bottom of a leaky boat.” He stated that “any dollar above projections should be spent on one-time improvements” over and above keeping the city “efficient, safe and clean.”
OTHER CITIES
During the city-wide debate, early supporters of the occupation tax pointed to Columbus, Philadelphia, Chicago, or Ashland as utilizing an earnings based revenue instrument.
But, the tax represents an invitation to attorneys. Huntington has battled changes or challenges across the street, ranging from residency requirements to health insurance modifications and withholding insurance proceeds.
Although scuttling a “friendly suit” suggestion by Insco to get it in the court system, City Attorney Scott McClure opined, “there are ways we might be able to get it before the courts to get some type of decision on it, but I have not heard many complain about the unconstitutionality of it. I think the laws nationwide is pretty clear particularly when it comes to the taxation without representation issue. Cases decided are pretty steady that you’re in there, you have the benefit of the city, it’s not unreasonable to require you to pay something.”
While expressing confidence in his research McClure eventually conceded, “before we waste a bunch of time, a lot of effort and everything else, perhaps, we can get some type of decision in order to get a sense of what we have to do.”
Chairman Insco agreed. “There’s no way we can reduce municipal, reduce any B & O, reduce service fees until the occupation tax has been challenged in court and [upheld]. We’d create a revenue shortfall , if we removed those fees and taxes [first]. What we will do, and I hope I speak for Mr. Williams, that there will be a clause in the ordinance(s) that if the occupation tax is challenged or repealed (in 2013) , the municipal fee will go back where it was, the service fee will go back where it was and all the B & O’s will be back where they were. “
THE LOW END EXEMPTION
One of the drafts exemptions provided the refund of the 1% withholding to people earning less than $10,000 a year.
“Your total earned income --- in the city or outside the city --- has to be less than $10,000 in a calendar year to get back any amount for the portion withheld by the city,” explained Runyon.
The question and one’s similar have come up on the Facebook page opposing the tax and in a letter received by HNN which stated:
“I am a Huntington resident and work in the city. I have been following this subject very closely. One point I think would be worth elaborating on is the issue of "who doesn't have to pay."
“In the various local news outlets, the stories have made reference to the $10,000 annual threshold as being "exempt," and also as being "eligible for refund." An exemption and a refund are two totally different things. I think people (reporters and citizen) are missing this minor, but I believe significant, distinction.
“In reading the draft proposal, in sections 774.04 and 774.12 it clearly calls it a "refund." However, individuals have to petition for the refund.
“The way I read it, EVERYONE who earns an income (aside from disability, retirement, etc.) will have to pay the 1% tax and only after they pay it, at the end of the calendar year can a person petition for a refund if they earned less than $10,000.
“This issue does not affect me, but thinking of the many citizens/workers it would affect, I just see this as a subversive way for the city of collect money from the lowest-paid individual's and then basically bet on them not being informed, capable, or motivated to actively seek out a refund. Honestly, how many people who earn that little will be savvy enough to understand the tax code? Not to stereotype, but honestly it's probably not very likely these folks will understand or know their rights.
“This is taking money out of their pockets throughout the year (possibly making them even more dependent on government and social services) and then saying "if you remember, and if you figure out how, you can ASK for a refund at the end of the year."
“This whole proposal makes me furious!”
Within a few minutes after HNN forwarded the comment to Runyon, he responded:
“Because an employer cannot know how much any one person earns in a year the only way to do this is through a refund process. Keep in mind, this person is already paying $156.00 per year and that will go away. It is not meant to keep someone from receiving a refund. We issue refunds today (some as small as $5.00) when someone has paid the City Service Fee twice. Also, no refund will exceed $99.99 since the person only qualifies if amount withheld was for income below $10,000. Note that the refund only applies if all earned income (from inside and outside city) is below $10,000 in a calendar year.”
CIVILITY AND PROFESSIONALISM and a COMMENT
Mayor Wolfe has instituted a new attitude for expressing issues --- he calls them challenges.
During the hearing several citizens exchanged (either at the microphone or from the audience) an occasional questionable rant. To the credit of everyone, those were brief. Williams praised the conduct of all in attendance.
Runyon and other members of the administration, as well as those serving on council, are more than ever responding and listening to public input. They appear genuinely hungry to serve and demonstrate transparency in order to work together for a solution or solutions, whatever they may be.
After the shattering of take for granted homeland security on and after 9/11, citizens, stakeholders, commentators and media retreated to unite behind a common cause --- the attack on our country. Now, the pendulums nation and city wide appear open to withholding no formerly sacred cow from examination.
That’s a good thing by concept, but these examinations must go beyond scripted pretence. They must proceed forward into actions and conduct that ripen solutions to the challenges of the 21st Century.
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ANALYSIS: Restructuring Huntington’s Taxes Now Fill Council’s Plates
Galvanized Debate Must Collectively Turn Challenges into Solutions
By Tony Rutherford
Huntingtonnews.net Reporter
Huntington, WV (HNN) – Having listened and observed a local exercise of government debate extending from the city administration and council members to residents and workers within the Huntington city limits, the “stage” appears set for a yet to be determined final act. Decisions and there are many have mounted on the plates of Huntington City Council members.
Based on the statements of council members both before and after public comment, the draft proposal of the Occupation Tax as valiantly submitted by the administration appears destined for a watery grave in the Ohio River.
And, Finance Chairman Steve Williams appears inspired that the proposal and hearing process have galvanized so many into closely examining their government.
After the meeting, Williams “welcomed the opportunity” for a summit with leaders such as the one proposed by Del. Sobonya.
The metamorphosis of the proposal into a tax reform package --- whether partly preconceived and molded by the tone of public input or not --- the city’s leaders appear to have open minds under the anxiety of the tax proposal.
“We have changed the discussion,” Williams said after the lengthy hearing. “Now that we have changed the discussion, let’s look at the points and see how to fine tune this. What might be wrong with our proposal? I have wanted, Jim Insco wanted, Nate Randolph wanted to change the direction of the debate. It’s not a tax increase; we are re-structuring our tax structure.”
And, Finance Director Deron Runyon conceded that the process represents “the way it is calculated, it is a work in progress,” adding that as components are proposed “we will look at the numbers.”
The tax reform package appears to square with Sobonya’s statement that occupation tax revenue should not be directed (no matter how well intentioned) to the general fund because “all of this can go away [in 2013]” based on the will of the legislature.
And, it addresses concerns of the Huntington Regional Chamber of Commerce. As councilman Nate Randolph stated, “ I cannot support this unless there is a big reduction in other taxes.” Essentially, Randolph declared “don’t use this for a cork in the bottom of a leaky boat.” He stated that “any dollar above projections should be spent on one-time improvements” over and above keeping the city “efficient, safe and clean.”
OTHER CITIES
During the city-wide debate, early supporters of the occupation tax pointed to Columbus, Philadelphia, Chicago, or Ashland as utilizing an earnings based revenue instrument.
But, the tax represents an invitation to attorneys. Huntington has battled changes or challenges across the street, ranging from residency requirements to health insurance modifications and withholding insurance proceeds.
Although scuttling a “friendly suit” suggestion by Insco to get it in the court system, City Attorney Scott McClure opined, “there are ways we might be able to get it before the courts to get some type of decision on it, but I have not heard many complain about the unconstitutionality of it. I think the laws nationwide is pretty clear particularly when it comes to the taxation without representation issue. Cases decided are pretty steady that you’re in there, you have the benefit of the city, it’s not unreasonable to require you to pay something.”
While expressing confidence in his research McClure eventually conceded, “before we waste a bunch of time, a lot of effort and everything else, perhaps, we can get some type of decision in order to get a sense of what we have to do.”
Chairman Insco agreed. “There’s no way we can reduce municipal, reduce any B & O, reduce service fees until the occupation tax has been challenged in court and [upheld]. We’d create a revenue shortfall , if we removed those fees and taxes [first]. What we will do, and I hope I speak for Mr. Williams, that there will be a clause in the ordinance(s) that if the occupation tax is challenged or repealed (in 2013) , the municipal fee will go back where it was, the service fee will go back where it was and all the B & O’s will be back where they were. “
THE LOW END EXEMPTION
One of the drafts exemptions provided the refund of the 1% withholding to people earning less than $10,000 a year.
“Your total earned income --- in the city or outside the city --- has to be less than $10,000 in a calendar year to get back any amount for the portion withheld by the city,” explained Runyon.
The question and one’s similar have come up on the Facebook page opposing the tax and in a letter received by HNN which stated:
“I am a Huntington resident and work in the city. I have been following this subject very closely. One point I think would be worth elaborating on is the issue of "who doesn't have to pay."
“In the various local news outlets, the stories have made reference to the $10,000 annual threshold as being "exempt," and also as being "eligible for refund." An exemption and a refund are two totally different things. I think people (reporters and citizen) are missing this minor, but I believe significant, distinction.
“In reading the draft proposal, in sections 774.04 and 774.12 it clearly calls it a "refund." However, individuals have to petition for the refund.
“The way I read it, EVERYONE who earns an income (aside from disability, retirement, etc.) will have to pay the 1% tax and only after they pay it, at the end of the calendar year can a person petition for a refund if they earned less than $10,000.
“This issue does not affect me, but thinking of the many citizens/workers it would affect, I just see this as a subversive way for the city of collect money from the lowest-paid individual's and then basically bet on them not being informed, capable, or motivated to actively seek out a refund. Honestly, how many people who earn that little will be savvy enough to understand the tax code? Not to stereotype, but honestly it's probably not very likely these folks will understand or know their rights.
“This is taking money out of their pockets throughout the year (possibly making them even more dependent on government and social services) and then saying "if you remember, and if you figure out how, you can ASK for a refund at the end of the year."
“This whole proposal makes me furious!”
Within a few minutes after HNN forwarded the comment to Runyon, he responded:
“Because an employer cannot know how much any one person earns in a year the only way to do this is through a refund process. Keep in mind, this person is already paying $156.00 per year and that will go away. It is not meant to keep someone from receiving a refund. We issue refunds today (some as small as $5.00) when someone has paid the City Service Fee twice. Also, no refund will exceed $99.99 since the person only qualifies if amount withheld was for income below $10,000. Note that the refund only applies if all earned income (from inside and outside city) is below $10,000 in a calendar year.”
CIVILITY AND PROFESSIONALISM and a COMMENT
Mayor Wolfe has instituted a new attitude for expressing issues --- he calls them challenges.
During the hearing several citizens exchanged (either at the microphone or from the audience) an occasional questionable rant. To the credit of everyone, those were brief. Williams praised the conduct of all in attendance.
Runyon and other members of the administration, as well as those serving on council, are more than ever responding and listening to public input. They appear genuinely hungry to serve and demonstrate transparency in order to work together for a solution or solutions, whatever they may be.
After the shattering of take for granted homeland security on and after 9/11, citizens, stakeholders, commentators and media retreated to unite behind a common cause --- the attack on our country. Now, the pendulums nation and city wide appear open to withholding no formerly sacred cow from examination.
That’s a good thing by concept, but these examinations must go beyond scripted pretence. They must proceed forward into actions and conduct that ripen solutions to the challenges of the 21st Century.
Share This Story:
Make HNN Your Homepage (IE Users Only)
