Committee: Property taxes better for Lima schools

LIMA - A committee established to examine property and income tax levies recommended to the Lima school board Thursday that it go with a property tax, but not until 2010.

The committee members believe a property tax has the higher probability of passing, committee member Rob Nelson said. It has historical precedence, viewed more favorably on a survey and costs people less than an income tax, he said. A property tax also includes businesses, while an income tax does not.

Board members submitted names of people they wanted to serve on the committee. Ten regularly attended, Treasurer Ryan Stechschulte said. They met for several months.

While an income tax can generate large revenues, wealthier people bear a higher share of the taxes. The problem, Nelson said, is Lima doesn't have many high-wager earners. Less than 1 percent of the city's population makes more than $200,000 per year. Less than 3 percent make more than $100,000.

The elderly and those nearing retirement facing fixed incomes are likely to vote an income tax down, Nelson said, adding that elderly people tend to vote.

The school board has repeatedly debated between the two types of taxes, with member Bobbi McGinnis being adamant that an income tax is fairer than a property tax. She has voted against putting property taxes on the ballot in the past.

Voters rejected two property tax requests in the last year and a half. A property tax levy renewal passed last November.

Using the 1.89-mill levy voters renewed last year, Nelson said the owner of a $100,000 home pays $57.80 a year, while someone making $50,000 a year would pay $375 a year with a similar income tax. McGinnis argued that while the income tax seems to cost more, property tax owners are already paying existing levies.

"It's another added levy for them, and they are already paying for two," she said.

The committee's philosophy, Nelson said, is that even renters are paying the property tax, just through their landlords.

The district will likely ask voters to renew another levy in November. The committee recommended waiting to ask for new money until next year.

"It will take some time to sway the voters," Nelson said.

Board President Saul Allen Jr. said the board would consider the committee's recommendation. He said each board member would have to make his or her own decision. The board will discuss all options in the coming months, he said.

The committee formed after survey and focus group discussions showed people needed more education on income taxes. The committee also examined what was needed to get a levy passed. Voters want to know why the district needs money and have a better understanding of the district's costs, Nelson said.

Officials need to talk more with voters on the relationship between an enhanced educational system and a higher quality of life for everyone, he added.

"If many of these issues are discussed at length," Nelson said, "the probability that a levy would pass would increase."

AT A GLANCE

A committee of community members has been studying the pros and cons of income and property taxes. On Thursday, the committee told the Lima school board a property tax is the best option.