Cleveland voters to decide city's income tax rate this November

Posted at 6:20 PM, Aug 30, 2016

Cleveland voters will decide more than who will be the next president in November; they'll be voting on whether to raise the city's income tax rate for the first time in 35 years from 2 percent to 2.5 percent.

For the better part of the past five years, the city has been balancing its budget through creative financing, cutting corners where they could during the course of a given year to guarantee they end the year in the black.

It was a task made much more difficult in 2011 when in an effort to balance it's own budget the state cut the amount of money it was sending to local governments. In Cleveland's case, it was a figure Mayor Frank Jackson put at the time at $35.7 million.

Still the city managed to hold spending flat and bridge the gap until 2016 when collective bargaining agreements along with costs associated with implementing the police consent decree found them with $42 million in expenditures they didn't have last year.

That's when the decision was made to seek the additional one-half of one percent increase in the wage tax paid by all of those who work in Cleveland regardless of where they live. 87 percent of those who work in Cleveland live outside the city.

The hike will generate an additional $80+ million for the city and enable to not only avoid service cuts and layoffs but increase services.

The Greater Cleveland Partnership came out this week in support of the hike after studying it for three months.

"It became obvious pretty immediately that there was a need for new revenues the question we really double down on was how much," said GCP's President and CEO Joe Roman.

"And we became comfortable with the half percent when we saw both the opportunities for funding increased safety in our community but more than that to continue to make our neighborhoods ripe for investment," he said.

"That means you need greater services, you need better roads, you need more housing inspections, you need faster codes and permits to come forward. So all of those things are part and parcel to what this tax will allow the city to do to continue the momentum in the city," he said.

"To attract investment people have to see every neighborhood in our community being as attractive and interesting for them as Tremont or Ohio City or University Circle and that's what we think this tax can help to achieve," Roman added.

Roman was quick to point out that the income tax increase vote goes hand and hand with the school levy renewal that voters will also decide.

"The right way to increase wages is to increase skills, the right way to make sure families stay in Cleveland is to be attracted by all of the cool stuff that's going on but then they need to see that they can stay when they start having children," he said. "And we think supporting the school levy and supporting the income tax at the same time will help us do that."