By Erin Meyer, Daily Reporter
emeyer@greenfieldreporter.com
HANCOCK COUNTY - Hancock County residents can expect to see a little more money taken out of their paychecks by the government.
The Hancock County Council raised the economic development income tax last night in hopes the investment by taxpayers now will mean a stronger local economy in the future.
"I think most of us believe this is a poor time to increase taxes," Councilman Jim Shelby said. "However,...there would be no net increase in taxes."
The move followed a public hearing that drew both supporters and opponents of the new tax.
"I'm just a local taxpayer," said Garry McDaniels. "City, county and state have come up with their own little taxes to nickel and dime you to death."
He and other residents called on the council to further cut local government spending just as families dealing with layoffs and wage reductions have been forced to spend less.
"I lost two dollars an hour and about seven hours a week (at my job)," Dennis Musser told the council. "That's a budget cut."
Under state law, rates for the EDIT tax range from 0.1 percent to 0.5 percent.
In Hancock County, residents were paying 0.15 percent of their adjusted gross income to fund the Hancock County Public Library through the EDIT tax.
Upon learning earlier this year that the library has a surplus of roughly $3 million in the bank, the council lowered the rate to 0.1 percent.
The new EDIT tax combined with the 0.1 percent the library is still receiving amounts to .2 percent of adjusted income. Still, the new tax will likely be "revenue neutral," according to the council, because the library will not need .05 percent for the next two to three years, and the council intends to repeal the new EDIT tax after one year.
"On $50,000, it would be $50 per year, 14 cents per day," Council President Bill Bolander said, hoping to put into perspective the individual burden taxpayers will bear.
Even before the council voted to enact the tax, those who stand to benefit were jockeying for their piece of the pie.
"I rise tonight in support of your proposal with one qualification. I would recommend that you leave the increase in place (and designate it) for economic development," said Dennis Maloy, executive director of the Hancock County Economic Development Council.
Maloy said if the county decided to give the economic development council a portion of the revenue, he would use the money to hire a third staff member to focus on existing and small businesses. The law also requires that revenues generated by the EDIT tax must be divided based on population to the county, city and towns.
The exact amount of money to be generated by the EDIT tax is unknown. But based on the county's estimates and rising unemployment, the EDIT tax will likely generate closer to $1.5 million.
All but one council member voted in favor of the tax increase.
"I'm concerned about the city getting a windfall," said Richard Pasco, former city council president and the only county council member to vote against the tax increase.
He pressed Greenfield Mayor Brad DeReamer to reinstate the city's membership to the Hancock County Economic Development Council and funding for the council, which DeReamer cut last year.
"That's up to the city council," DeReamer said.
The mayor attended the hearing to encourage the council to impose the tax.
"When a company comes (to Greenfield), I have nothing else to offer them," he said.
The county council will have little say on how the city and towns spend their shares of the EDIT windfall, but the council intends to create its own separate fund to ensure that the money goes toward its intended purpose.
"If we keep the money in an economic development fund, that would keep the pressure on us to continue looking for efficiencies," Shelby said.
In the model council members have discussed, businesses might come before the council to request assistance, whether it be through a loan or grant.
Pasco said another reason he voted against the tax is that the county has not laid out enough of a spending plan.
"It's a much bigger issue to me than what the city does with the money," he said. "There's a lot of unanswered questions."
Local officials who fear they might have something to lose also spoke up.
"We can live within the .10 for the next year or so," Library Director Dianne Osborne said. "Definitely by 2013, at .10, the library fund...will become negative. At that point we would revert to property taxes."
But the council's intent is to repeal the new tax after on year, according to the ordinance.
The county auditor's office said the new EDIT tax will go into effect on Oct. 1.