By Sean Rice
Celina City Council is moving along with a resolution that puts a 0.5 percent income tax question on the ballot for city voters.
Council members passed the second of three readings of the resolution Monday night and scheduled a special council meeting for Aug. 16 to finalize the ballot question before the Aug. 19 deadline.
Celina Safety-Service Director Mike Sovinski went over the administration's recommendation for an income tax hike, which would increase residents tax from 1 percent to 1.5 percent. The change would generate near $1.4 million for the general fund.
Auditor Pat Smith has warned council members the 2005 budget could see a deficit of nearly $500,000. And, one council member is worried the state could remove an annual payment of $500,000 to the city, which comes from the kilowatt-hour tax.
In a special tax committee meeting Monday night, Sovinski reviewed other options available to cut costs or raise money, including right-of-way fees, recreation fees, development fees, a lodging tax or transferring money to the general fund from the utility funds. Council members rejected the idea of transferring funds between accounts, along with the creation of right-of-way fees. Several years ago Celina was warned by the Ohio Auditor of State to discontinue using utility funds for general fund activities.
The big expenses in the general fund include police and fire departments and municipal court costs.
"We may want to consider raising some of those (parks fees), but it isn't a great deal of money that could be generated," Sovinski said.
Council member Angie King said there is no room for cuts in the parks department. She also again stressed the city should not depend on the state-supplied kilowatt-tax payment.
If the tax is approved by voters, the spending plan outlined by the administration would provide $700,000 annually for street repairs, $150,000 to $200,000 for a code enforcement officer for property maintenance and $200,000 for equipment in the fire and police departments. Sovinski said the city should continue using the kilowatt-hour tax payment to pay for police and fire personnel costs.
Members also discussed plans to create five new tax increment financing (TIF) districts around the city. The TIF zones would capture increases in property taxes into a special account. Celina has one TIF zone on West Bank Road that was designed to provide funds to build a boardwalk on the lakeshore.
Members passed the first reading of 11 ordinances creating five new districts and expanding the West Bank Road district to include downtown Celina.
"Is there a point where you can over-TIF? We don't want to saturate ourselves," councilor June Scott said.
"Everything we've heard is there is no downside," councilor Denny Smith said. "Anybody know any different than that?"
Hired consultant Kent Bryan said there is no downside to TIFs and five is not too many, because several areas are already being redeveloped.
"There were communities using this kind of funding that have gotten into trouble," Bryan said, adding their trouble resulted from borrowing against unrealized TIF predictions.
"In no cases are we looking at that," Bryan said. "We have new growth that's not on the tax rolls yet that we'll be able to capture."
Council member Rick Bachelor said the school district is not hurt by the TIF and may benefit because the district's formula funding from the state is not decreased because the increase in property values is shielded.
Celina City Schools board of education must approve of the new TIF districts.
Members passed a new electric rate ordinance Monday night to replace the ordinance vetoed by Mayor Sharon LaRue. Last month the council finished an electric rate restructuring ordinance that made broad changes to all rates. Most larger users saw decreases in rates while residences saw increases.
After amending the rate changes several times, council members never made a motion to apply the changes to the actual ordinance. LaRue said the oversight caused her to reject the legislation, and then members passed it as an emergency ordinance Monday.
"The changes were made at committee and regular meetings to address concerns that city customers were not seeing the same benefit as some of our rural customers," Sovinski said of the electric rates.
Earlier in the meeting, community resident Tom Chivers said, "the Celina council sheds emergency ordinances like a flea bitten dog who's just been powdered."