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Council defeats proposed reciprocity tax/ income tax credit

Cary Ashby • Dec 7, 2016 at 7:23 AM

Norwalk City Council voted down a possible change to the city’s income tax credit aka a reciprocity tax Tuesday.

Deb Lucal was the only council member to vote in support. The proposed ordinance was that in tax year 2017, residents who live in Norwalk but work in another taxing district would have received a 75-percent tax credit in the city and 50 percent after that.

Council earlier tabled a version of the ordinance — strictly a 50-percent tax credit. The matter was referred to the finance committee. Norwalk Law Director Stuart O’Hara said committee members must take action on it or the legislation will die.

“I just want it do die,” Councilman Steve Schumm said during Tuesday’s meeting. 

The finance committee will meet before next week’s council work session at 7:30 p.m. Tuesday. Council Steve Euton said he “strongly encouraged” all council members to attend.

Councilman Chris Castle had an excused absence from Tuesday’s meeting as he was unable to catch a flight from Chicago. However, he shared some thoughts about the reciprocity tax with the Reflector via email.

“I was stuck in a Chicago airport while this vote was happening because of an economic development conference which I was attending. But I had spent the days prior calling the other members of council, reminding them that this legislation would be harmful to the city in the long term if passed,” Castle said. “I’ve been opposed to it from day one.

“I’ve heard people say that several Ohio cities have already enacted a similar tax and that's true. But many of those cities have also repealed it within the first year,” he added.

In other action Tuesday, council passed a resolution requesting Huron County Auditor Roland Tkach certify the tax value and revenue that would be generated by a .9-mill replacement levy for maintaining the Norwalk Fire Department. This means the auditor’s office will determine the value of the levy and after that, council would need to vote to decide if it will go to the voters.

Now generating about $67,700 annually, the present levy — a .9-mill renewal — pays for part of the wages and equipment in the fire department. It has been on the books since 1976.

O’Hara said the replacement levy could be on the primary election ballot in May, possibly making it the only issue. He added that council will need to make a decision by February to decide if the issue would go on the May or November ballots. 

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