As the City of Delaware continues to weigh a ballot measure that would increase its income tax rate for the first time in 13 years, the proposal has been revised to reflect feedback received from the community.
During Monday’s meeting of the Delaware City Council, the first reading was held for an ordinance that would send the rate increase to the March 2024 ballot. After originally asking for an increase from the current rate of 1.85% to 2.25%, the current proposal is asking to increase the rate to 2.20%.
Much of the debate among council members has been about the length of the tax increase, with opinions varying based on the need for a permanent tax increase and the perceived unlikelihood of a permanent tax increase being supported by voters. Ultimately, the city has decided to ask for a temporary increase for a period of five years beginning in 2025, allowing voters to see how the revenue is being used before deciding on a renewal at the end of the cycle.
“Based upon the feedback we have received from residents, combined with current economic conditions, a temporary increase at a reduced rate is being proposed,” City Manager Tom Homan said in a release from the city. “We believe it strikes a balance between the needs of community, resources, and the sentiment we have heard so far.”
According to the release, $7 million in new revenue would be generated with approval of the increase, with a majority of the revenue going toward paving neighborhood streets and alleys while supporting the capital project program that maintains and repairs city infrastructure.
“The city would also make investments in economic development to grow local jobs and enhance the economic base,” the release states. “It would also go toward operating the 70-acre Oak Grove Cemetery, which the city was required to take ownership of in 2012.”
Built into the current income tax rate of 1.85% is a 0.15% parks and recreation tax levy approved by voters in 2008. The council has also opted to place a renewal of that levy on the March ballot. The dedicated money would not be a new tax but a continuation of the current parks and recreation funding.
However, with approval of the renewal, funds from the levy would be permitted to go toward general parks and recreation uses, such as programs and upgrades, unlike the current tax that can only pay down debt on recreation projects.
A public hearing has been set to coincide with the second reading of the proposal at the next council meeting, scheduled for Monday, Oct. 23. Meetings begin at 7 p.m. and are held in the council chambers in City Hall, located at 1 S. Sandusky St.
Reach Dillon Davis at 740-413-0904. Follow him on Twitter @DillonDavis56.