Aug. 6, 2010
Huntington, W.Va. Stands at a Fiscal and Service Moving Forward Crossroads
By Mayor Kim Wolfe
Special to Huntingtonnews.net
Editor's Note: HNN requested that the administration provide their position pertaining to the Tax Reform Package before council.
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Huntington, WV (HNN) - The City of Huntington is at a crossroads.
Simply put, we must make the hard decisions that will allow us to move forward or allow a lack of critical thinking doom us to a downward spiral of fiscal ineptitude. This is not hyperbole, but rather the reality that all cities face in economic reality of today. In a recent discussion I had with a local business leader regarding the merits and necessity of an occupation tax, the leader stressed his understanding of the need for additional revenue for the City. He also noted that this tax must be viewed as an investment into our community. It was a rare instance when I heard someone from the business community recognizing that our need for additional revenue in our community is critical to our survival as a viable and functioning city.
My goal has always been for us to be a more citizen- and business-friendly city. Those that are opposed to the task frequently say that we, those within City government, must do more to attract businesses. In order for us to attract additional businesses or for those existing businesses to expand in our community, we must be a town that is more attractive and safe. In the May 2006 report from the National League of Cities titled “Taxing Problems: Municipalities and America’s Flawed System of Public Finance,” the section on Economic Growth and Public Finance clearly states that:
“A vital economy is essential for ensuring a quality community and providing adequate revenues to provide services to residents. In turn, the prosperity of residents and the local community help to encourage a growing economy.”
The bottom line is if we seek to attract those who would expand or build a business in our community, our community must provide the services necessary to establish a quality community, and those revenues to support the services are critical. Everything that I have read, either for or against occupation or earnings taxes say that it is essential for municipalities to show that the taxes paid by citizens and businesses are equally matched with public service benefits.
No question and no disagreement. I am committed to ensuring that public service benefits will equal that of the taxes to be rendered by taxpayers. We have demonstrated such action with the $1 increase of the user that occurred in 2009. As a result, those who paid the City Service Fee saw clearly marked roads, signage on equipment and additional police officers in our neighborhoods.
Much that has been cited recently by those not in favor of the tax have pulled from data that emphasize three basic tenets: providing lower taxes on business, the idea that sales/property taxes are acceptable, and the view that excessive income taxes on working residents and nonresidents are bad.
The tax reform that lies before Council addresses the need to lower business taxes on manufacturers, retailers and service businesses through an occupation tax and elimination of City Service Fee. Also within the reform package is the ability for the City to enact a sales tax on items excluding items such as automobiles, gas and utilities.
Regarding the ability for the City to enact changes or generate additional revenue from property taxes, the City is restricted by state law in how much it can charge for property taxes. Most of the City’s levy capacity is already used for the TTA levy. Of the City’s top 20 employers, 80 percent of their employees work for government or non-profit entities which do not pay property taxes. Raising property taxes, while equitable, is not a viable alternative for Huntington.
The bulk of the studies that opponents to the tax reform have cited refer to communities such as Cincinnati, Philadelphia and New York. With all due respect, this is apples and potatoes. These communities have earnings taxes on 2 to 4 percent of a person’s income. The 1 percent rate is nowhere near the rates of the large cities quoted in the articles. We are levying the tax on those people working within the City, not those who just live here as in an income tax. One of the studies emphasized the fact that both residents living in the City and those working in the City must pay, as in Ohio. We would only be charging those people who work in the City. This creates no disincentive to live in the City as Ohio’s local income taxes do.
We are a regional community that crosses neighborhoods and state lines. It is essential for the continued growth and expansion of our region that Huntington is successful. The City of Huntington has taken the initiative to address taxation issues that affect the entire state. It is a responsibility that we do not take lightly.
We are aware that this ability is available to us for a limited time, and I am committed to ensuring that the opportunity does not pass us by. Not only are we seeking to reform that which hinders municipalities, but we are seeking to reestablish ourselves as a quality community that fosters both growth and safety for citizens and businesses.
As I said, we’re at a crossroads. We ask your support in allowing us to move our City into the future.
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Huntington, W.Va. Stands at a Fiscal and Service Moving Forward Crossroads
By Mayor Kim Wolfe
Special to Huntingtonnews.net
Editor's Note: HNN requested that the administration provide their position pertaining to the Tax Reform Package before council.
Huntington, WV (HNN) - The City of Huntington is at a crossroads.
Simply put, we must make the hard decisions that will allow us to move forward or allow a lack of critical thinking doom us to a downward spiral of fiscal ineptitude. This is not hyperbole, but rather the reality that all cities face in economic reality of today. In a recent discussion I had with a local business leader regarding the merits and necessity of an occupation tax, the leader stressed his understanding of the need for additional revenue for the City. He also noted that this tax must be viewed as an investment into our community. It was a rare instance when I heard someone from the business community recognizing that our need for additional revenue in our community is critical to our survival as a viable and functioning city.
My goal has always been for us to be a more citizen- and business-friendly city. Those that are opposed to the task frequently say that we, those within City government, must do more to attract businesses. In order for us to attract additional businesses or for those existing businesses to expand in our community, we must be a town that is more attractive and safe. In the May 2006 report from the National League of Cities titled “Taxing Problems: Municipalities and America’s Flawed System of Public Finance,” the section on Economic Growth and Public Finance clearly states that:
“A vital economy is essential for ensuring a quality community and providing adequate revenues to provide services to residents. In turn, the prosperity of residents and the local community help to encourage a growing economy.”
The bottom line is if we seek to attract those who would expand or build a business in our community, our community must provide the services necessary to establish a quality community, and those revenues to support the services are critical. Everything that I have read, either for or against occupation or earnings taxes say that it is essential for municipalities to show that the taxes paid by citizens and businesses are equally matched with public service benefits.
No question and no disagreement. I am committed to ensuring that public service benefits will equal that of the taxes to be rendered by taxpayers. We have demonstrated such action with the $1 increase of the user that occurred in 2009. As a result, those who paid the City Service Fee saw clearly marked roads, signage on equipment and additional police officers in our neighborhoods.
Much that has been cited recently by those not in favor of the tax have pulled from data that emphasize three basic tenets: providing lower taxes on business, the idea that sales/property taxes are acceptable, and the view that excessive income taxes on working residents and nonresidents are bad.
The tax reform that lies before Council addresses the need to lower business taxes on manufacturers, retailers and service businesses through an occupation tax and elimination of City Service Fee. Also within the reform package is the ability for the City to enact a sales tax on items excluding items such as automobiles, gas and utilities.
Regarding the ability for the City to enact changes or generate additional revenue from property taxes, the City is restricted by state law in how much it can charge for property taxes. Most of the City’s levy capacity is already used for the TTA levy. Of the City’s top 20 employers, 80 percent of their employees work for government or non-profit entities which do not pay property taxes. Raising property taxes, while equitable, is not a viable alternative for Huntington.
The bulk of the studies that opponents to the tax reform have cited refer to communities such as Cincinnati, Philadelphia and New York. With all due respect, this is apples and potatoes. These communities have earnings taxes on 2 to 4 percent of a person’s income. The 1 percent rate is nowhere near the rates of the large cities quoted in the articles. We are levying the tax on those people working within the City, not those who just live here as in an income tax. One of the studies emphasized the fact that both residents living in the City and those working in the City must pay, as in Ohio. We would only be charging those people who work in the City. This creates no disincentive to live in the City as Ohio’s local income taxes do.
We are a regional community that crosses neighborhoods and state lines. It is essential for the continued growth and expansion of our region that Huntington is successful. The City of Huntington has taken the initiative to address taxation issues that affect the entire state. It is a responsibility that we do not take lightly.
We are aware that this ability is available to us for a limited time, and I am committed to ensuring that the opportunity does not pass us by. Not only are we seeking to reform that which hinders municipalities, but we are seeking to reestablish ourselves as a quality community that fosters both growth and safety for citizens and businesses.
As I said, we’re at a crossroads. We ask your support in allowing us to move our City into the future.
Share This Story:
Make HNN Your Homepage (IE Users Only)
