The $60 Million Income Tax Increase and Lakewoods Future

[Bill Call]

The question of taxation and spending are THE fundamentals in any election. This election is no different except that the questions of taxation and spending are not being fully addressed.

It is no secret that the Mayor thinks a 33% income tax increase is needed to balance the City's books. It is no secret that both councilman Fitzgerald and councilman Demro are opposed to that tax increase.

What is a secret:

1. How will the Mayor spend the money?

2. Without the money how will the two councilman run the City?

I used the $60 million number because that is about how much the proposed tax increase will raise over a ten year period. I think it is fair to look at that time horizon because it presents a true picture of the cost of the tax increase and the potential investment opportunities such a tax increase will provide the City.

Translation into campaign speak: " $60 million to fund business as usual or $60 million to fund Lakewood's future?"

[Stephen Eisel]

The easy solution is to increase the income tax. The harder solution is to attract new businesses and new sources of revenue for the city. Is there any fat in the city budget that can be cut first? Also, the salary and benefits of all city employees (elected officials also) should be reviewed first. Can any of these jobs or services be out sourced to save the city money? A 33% increase in the city income tax would definitely get a lot of people thinking "Is it to expensive to live in Lakewood?"

[Jeff Endress]

I have a question:

Which is larger, a 33% increase, or an increase from .015 to .02 ?

Jeff

[Brian Pedaci]

.015 to .02

Because increasing .015 by 33% gets you infinitely close to .02 but never quite there.

[Jeff Endress]

Good answer

Next question:

Which SOUNDS bigger:

33% increase, or an increase of 1/2 of 1%?

Jeff

[Joe Ott]

I hate it when Jeff hands pop quizzes...

[Bill Call]

.015 to .02

Because increasing .015 by 33% gets you infinitely close to .02 but never quite there.

Very clever!

[Tim Liston]

I'm sorry but when you increase .015 by "1/2 of 1%" you get .015075. You don't get 2%. The way the politicians characterize these increases is very misleading. I remember 2-3 years back when the State of Ohio raised the sales tax by "one percent". Well the sales tax on a $100 item went from $7 to $8 (including the county add-ons). That sure looks like a 14% increase to me. (it has since been rolled back some).

I saw in the paper that Cleveland is considering asking the voters to approve an increase from .02 to .0225. That will undoubtedly be characterized as an increase of "only a quarter of one percent" when it is in fact a 12.5% increase.

[Brian Pedaci]

Jeff, whether you look at it in terms of percent increase or net increase, the voter still must face the fact of how much it's going to hit them in the pocketbook.

Which do you think sounds worse to me? Increasing the tax by a half a percent, or my income tax bill going up $500/year?

Guess which one sounds more REAL to me?

[Jeff Endress]

Brian

I guess that's my point. When people toss out percentage changes, they can sound HUGE. Half of 1% (which, Tim's post notwithstanding IS .005) it doesn't sound so shocking.....

But you're right. THe bottom line is how it hits your wallet. If you're making 100,000 a year, that tax will cost you the 500 you mentioned. Frankly, I'm neither for nor against any increase, until someone tells me what I'll get for it. I just think it's really more honest to tell people their taxes will be raised by .5% (.005), then we can look at our w-2's and do our own math.

Jeff

[Steven Greenwell]

Perhaps there is a piece missing from this discussion.
I thought that when the former City Finance Director presented the idea that there was also to be a new tax credit -- the result being no net increase in tax for residents of Lakewood.

[Donald Farris]

Don't tell me this new increase is the old one that taxes people that live and work in Lakewood more than it does people that don't work in Lakewood. I guess if you don't want business in Lakewood that is the way to do it - you get what you tax.

Why would we provide disincentives for people to live and work in our city - isn't that what we want?

I do agree that whether we need to know more about what the tax will be spent on and need assurances that it will be spent on for example more police - and not just have this money going for more police but the general fund money that was for more police being shifted to something else.

JMHO

[Jim O'Bryan]

I do agree that whether we need to know more about what the tax will be spent on and need assurances that it will be spent on for example more police - and not just have this money going for more police but the general fund money that was for more police being shifted to something else.

JMHO

Don

Ask Bill it is his fantasy tax.

.

[Ed FitzGerald]

Jim:

Is a "fantasy tax" a tax on fantasies? Sorry, couldn't resist.

In December of 2005, we voted on Mayor George's tax increase proposal, and it was defeated 5-2. Later, we were told it was being put off until 2008 so that it would not compete with the school bond issue this year.

Maybe you're right- asking residents to approve a tax increase while refusing to specify where the money is going is a fantasy.

[Colleen Wing]

The more important question is where do the Council Candidates stand on this issue.

If the Mayor wins re-election that will only leave one member of council who has openly fought for spending cuts or a clear plan for the use of the revenue.

Who will help fight for the working families that own a home, a businesses, live, and work in Lakewood?

I know that my family has hit the trifecta of taxes burden.

Without an assessment of our core services, clear priorities, and verification that we are collecting current revenue equally from all residents- I will not support an income tax increase of any size.