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Boardman might welcome law to let townships levy sales tax

Published: Wed, February 9, 2011 @ 12:05 a.m.

By Ashley Luthern



With a vote on an additional police levy looming, township residents and officials are weighing alternative revenue sources.

One idea voiced at a recent trustees meeting was the township’s levying a sales tax, but it cannot legally do so without a change in state law. Townships can levy only a property tax, said township Administrator Jason Loree.

Last year, Boardman collected about $10.8 million in property tax, and the township’s annual budget was about $16 million, said George A. Platton, assistant to the fiscal officer.

In that same time, Mahoning County collected more than $27 million in sales tax, with some arguing at least 50 percent of that is generated in Boardman. Under Ohio law, counties and the state can levy a sales tax.

“Knowing that we have busy corridors for Market Street and [U.S. Route] 224, and you consider how much sales tax comes from the car dealerships, it’s safe to say at least 50, although some people may say it’s more,” Loree said.

But how much of the sales tax is returned to benefit the township?

None, said Anthony Magnetta, deputy auditor for Mahoning County.

The sales tax goes to the state, and then the county gets a lump sum back to its general fund, he said. That money is used to provide countywide services for nearly 30 departments, such as the sheriff, jail and juvenile detention and the various courts.

The county does not collect data on sales-tax distribution by township or municipality.

Boardman trustees have said to residents that more than 100,000 people come through the township during the day to work, eat and shop, based on traffic studies, and that safety forces are needed to keep them safe. The cost of those services, however, is carried by the roughly 38,000 Boardman residents.

“It would make sense that we wouldn’t push the full burden of the cost to do business on the property owners when a lot of folks come into the community from other places and that may cause use of our services,” Loree said.

“What are the businesses doing [to help]?” asked Joe Bush, a township resident, at the last trustees meeting.

Loree later cautioned residents from seeming anti-business.

“If a business comes in and they give somebody a job, and that person is able to work there, have an income and spend that money back into the community, then the business is keeping Mahoning County alive,” he said.

With the township split between residential and commercial property, both must work together in the interest of the township, Loree said. He added, “If there were no businesses, there would really be no Boardman Township or Mahoning County in terms of what people know and expect from it today.”

At the Jan. 24 meeting, Trustee Tom Costello explained to Bush that the township is interested in pursuing a change in state law to allow townships the ability to levy a sales tax.

State Rep. Ronald V. Gerberry of Austintown, D-59th, said the township would face an uphill battle.

“I know where Boardman’s coming from. I totally understand why they would like to see this. But with the conditions we’re facing, do I think anything like that would have legs? Well, it would have a difficult climb up the mountain,” Gerberry said.

Strong lobbying groups for cities, which can levy an income tax, and counties, which can levy a sales tax, would put up a fight against such a change, he said.

Loree, however, argued that a broad change could benefit all forms of local government.

“If we could all work together for a common goal — to allow us to tax the people how they want to be taxed — perhaps there wouldn’t be much opposition,” he said.

A bedroom community, Loree said, could choose to levy some kind of combination of income and property tax, for example.

State Sen. Joe Schiavoni of Canfield, D-33rd, called Boardman’s position in Mahoning County “unique.”

“Boardman feels that most of [the sales tax] is derived in Boardman, and it probably is,” Schiavoni said.

But he added that he is cautious about expanding the taxing power of local government.

“The bottom line is I would be worried to give government at any level another ability to tax residents, but Boardman is a unique situation, and I’m willing to hear them out,” Schiavoni said.

Boardman is hoping to get help on a law change from the Coalition for Large Ohio Urban Townships (CLOUT).

To be a member of CLOUT, a township must have a population of 15,000 or more and a budget of $3 million or more, said Vicky Earhart, chairwoman of the organization. The CLOUT membership is less than $200.

Earhart also is administrator for Anderson Township in Hamilton County, in southwest Ohio.

“We feel there has to be an overall approach to look at the best and effective way of providing local governments funding, perhaps looking at the gas-tax distribution,” Earhart said.

She said it was difficult to provide a definitive answer on CLOUT’s position of giving townships more taxation powers, because the group hasn’t met this year. The coalition meets today.

As administrator of Anderson Township with a population of 45,000, she said the area is mostly residential with a strong business corridor of restaurants and shops. Yet Earhart also admitted a taxing change might not be effective for Anderson.

“We don’t have an income tax and have historically prided ourselves on that,” she said. “In regard to a sales tax, while it would provide some replacement funding, it would not completely make up for” state cuts to local governments.

Michael Hinnenkamp in Springfield Township, near Cincinnati, echoed those sentiments.

“Philosophically, we’re in favor of” giving townships greater variety in taxation, he said. “Would it greatly aid our cause? Probably not.”

Even though Springfield has a population close to 40,000, it is a bedroom community, lacking large shopping centers or industrial complexes, he said.

Locally, Austintown Township Administrator Michael Dockry said that it would support Boardman’s efforts for a legislation change.

“I think any time you have the chance to spread your taxes among property, the sales or the income, we here we would be in favor of it,” Dockry said.

Austintown has an estimated population of 37,000 and is part of CLOUT.

Loree said he is optimistic of CLOUT’s chances of success.

and pointed out that this year the group has hired a lobbyist for the first time.

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