Thursday, June 3, 2010

“Sylvania Township trustee vote kills chance for TARTA sales tax” plus 3 more

“Sylvania Township trustee vote kills chance for TARTA sales tax” plus 3 more


Sylvania Township trustee vote kills chance for TARTA sales tax

Posted: 02 Jun 2010 04:04 PM PDT

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Barring a change of heart, TARTA's offer to provide some property-tax relief in exchange for a half-cent sales tax is dead.

Sylvania Township trustees last night rejected the regional mass transit authority's proposal by a 2-1 vote.

Board Chairman Carol Contrada said she shared many of the concerns expressed by trustees Kevin Haddad and John Jennewine, but said she would have preferred to have a special meeting on June 15 so that TARTA would have more time to explain its position. She also said any issue of taxation should go before voters.

Mr. Haddad said he saw no point in waiting. He told TARTA General Manager James Gee that the transit authority doesn't deserve an $8.4 million budget increase because of the degree to which it has lived off government subsidies.

TARTA hasn't come close to being operated as efficiently as a private business, said Mr. Haddad, citing the beauty salon he has owned on Monroe Street for three decades as an example of a well-run business.

"When it's public funding, you don't run it like a business because it's a gravy train," he said.

Mr. Jennewine agreed.

"We all see the empty buses," he said. "I could go in there in a day and a half and cut out 30 percent of the routes. It seems you guys are out of touch."

The Toledo Area Regional Transit Authority had proposed giving up its 2.5-mill levy on property in exchange for a half-cent sales tax. The switch was expected to boost TARTA's annual tax revenue from $17.2 million to $25.6 million.

It thought voters would have been receptive to the idea because with a sales tax, costs are spread around to more people - even visitors.

But to get the proposal on the Nov. 2 ballot, TARTA needed authorization from each of its nine member communities before the August filing deadline.

Sylvania Township's rejection last night killed the plan unless the township board reverses itself, said Mr. Gee, who spoke to The Blade from the hallway of the Sylvania Township offices after fielding questions from trustees.

"What we were seeking to do was give voters a choice," Mr. Gee said. He said he was disappointed the board would not at least take up Ms. Contrada's suggestion for a special meeting.

"They chose not to give us the opportunity to answer their questions," he said.

Mr. Jennewine said he was irked to learn the Ohio Public Transit Association, of which Mr. Gee is a board member, had begun exploring asking voters to approve a 0.25-percent statewide sales tax in the fall of 2012 to generate revenue for public transit across Ohio.

"Are you guys waiting for approval [of the local proposal] here before you spring that additional revenue stream on us?" Mr. Jennewine asked.

Mr. Gee is listed on the state organization's Web site as its secretary/treasurer. He said he was recently elevated to vice president.

He said he had not brought up the state organization's proposal because it is in its infancy stages and no attempt has been made to gather signatures to get it on the ballot.

He said he was not sure how much TARTA would receive from a statewide tax.

The local TARTA sales tax would have been authorized for 10 years.

Mr. Jennewine said he is receptive to the idea of shifting property taxes over to sales taxes, but not at the level of money TARTA had requested.

TARTA's nine member communities include Toledo, Ottawa Hills, Sylvania, Sylvania Township, Spencer Township, Maumee, Waterville, Perrysburg, and Rossford.

Perrysburg and Rossford - the only two in Wood County - would have had the option to withdraw from TARTA if the transit tax were enacted.

Ottawa Hills, Spencer Township, and Lucas County recently gave their authorization for the TARTA plan to go before voters.

According to figures Mr. Gee presented last week, a Sylvania Township family now paying $166 a year for an average-sized house was expected to pay $111 a year in additional sales taxes if the TARTA ballot proposal were enacted.

In Waterville, where the average household now pays about $142 a year in property taxes, families would have saved roughly $42 a year with the proposed sales tax, according to figures TARTA presented to village officials last week.

Approving the TARTA ballot proposal, though, would give Lucas County the second-highest sales tax in Ohio, a 7.25 percent charge on all taxable items instead of the current 6.75 percent.

Cuyahoga County, which has a 1-cent transit tax, collects 7.75 percent on taxable items.

Fulton and Henry counties charge 7 percent; Wood and Ottawa counties charge 6.5 percent. Monroe County collects Michigan's 6 percent state sales tax.

TARTA's $1 base fare is among Ohio's lowest for public transit. Mr. Gee said during a radio interview yesterday afternoon that revenue from those fares generates only about 1 percent of the transit authority's budget.

Mr. Gee also predicted savings for Toledoans while trying to woo authorization for a ballot question from a Toledo City Council committee.

"Within the state of Ohio, we are the last property-tax system in the state," Mr. Gee told the council's intergovernmental relations committee. "[The sales tax] is a tax that an individual has control over."

Councilman Tom Waniewski, the committee's chairman, questioned if a TARTA sales tax would "crowd out" the possibility of the city replacing its income tax with a sales tax of its own some day.

Contact Tom Henry at:
thenry@theblade.com
or 419-724-6079.

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Property Tax/Rent Rebate Application Deadline Extended to End of Year

Posted: 03 Jun 2010 07:00 AM PDT

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School District Property Tax Bills to be Eliminated for 120,000 Senior Homeowners

HARRISBURG, Pa., June 3 /PRNewswire-USNewswire/ -- The deadline to apply for Pennsylvania's Property Tax/Rent Rebate Program for older adults and residents with disabilities has been extended from June 30 to Dec. 31.

"Property Tax/Rent Rebates, combined with general property tax relief from slots gaming, will completely eliminate school property taxes for about 120,000 residents this year," said Secretary of Revenue C. Daniel Hassell. "Governor Rendell is extending the rebate program deadline again this year because he wants to be sure everyone who is eligible has time to apply for the relief they're owed."

The rebate program benefits eligible Pennsylvanians who are 65 and older; widows and widowers 50 and older; and people with disabilities 18 and older. A 2006 program expansion increased the income limit from $15,000 to $35,000 (which excludes half of Social Security income) for homeowners and raised the maximum standard rebate for homeowners and renters from $500 to $650. The income limit for renters is $15,000.

The program expansion also provides for supplemental property tax rebates of up to $325 - on top of the standard rebates - to homeowners in Philadelphia, Pittsburgh and Scranton; and to those in other parts of the state who pay more than 15 percent of income on property taxes. As a result, the maximum rebate for those homeowners is $975.

As of May 28, the Revenue Department had received more than 533,000 rebate applications. Nearly 600,000 older Pennsylvanians and residents with disabilities are expected to benefit from the program this year, as compared to 310,000 before the 2006 program expansion.

As specified by law, rebates will begin to be distributed on July 1. After June 30, rebates will be distributed as claims are received and processed.

Obtain Property Tax/Rent Rebate claim forms (PA-1000) and related information online at www.PaPropertyTaxRelief.com or by calling 1-888-222-9190. Forms and assistance also are available at Department of Revenue district offices (listed in the government section of phone directories), local Area Agencies on Aging, senior centers and state legislators' offices.

Claimants who already applied for Property Tax/Rent Rebates may check the status of claims online at www.PaPropertyTaxRelief.com or by calling, toll-free, 1-888-PATAXES.

The Property Tax/Rent Rebate Program is one of five programs supported by the Pennsylvania Lottery. Since the program's 1971 inception, more than $4.5 billion has been paid to eligible older adults and residents with disabilities. The expanded portion of the rebate program is paid for with revenue from slots gaming.

Media contact: Stephanie Weyant, 717-787-6960

SOURCE Pennsylvania Department of Revenue

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Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

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Property tax on new cars in question

Posted: 02 Jun 2010 05:19 PM PDT

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CHESAPEAKE, Va. (WAVY) - If you think you are paying too much property tax for your car, read on.

A WAVY.com investigation is shedding light on a taxation problem on new cars that do not have blue book values. The car has no value in the guide until after the first year. In that year, the commissioner of revenue offices use the sales price to figure the tax.

Norbert Kindler noticed that his property tax bill is higher than it should be. He is so upset about it, he not only called WAVY-TV 10, but he also called a member of the Virginia General Assembly who cared enough to show up at his house.

He said he was "Unfairly taxed for...the purchase of a vehicle that I did not pay that price for."

Here are the car facts:

Norbert Kindler bought a 2010 Lincoln at Freedom Lincoln Automotive.

 

But Kindler now has a personal property tax bill based on the higher price, not the lower price--the price actually paid.

"If it's wrong, it's wrong. Fix it. Don't sweep it under the rug and hope it will go away," he said.

The Chesapeake Commissioner of Revenue's office, who sent the bill, blamed the DMV. It is true that the DMV says it determines the sale price of a car:

"...shall include any reduction in price shown on the invoice for a manufacturer's discount or dealer's price discount since they directly reduce the sale price from the dealer to the consumer. Sales and Use Tax (SUT) should not be collected on these price reductions or discounts."

Kindler says that it's confusing and conflicting because the next paragraph reads:

"The sale price shall not include any credit given by the dealer for a trade-in, rebate, unpaid lien or other unpaid claim against the vehicle. BUT should be collected on these credits."

It is noted on the Buyer's Order from Freedom Lincoln Mercury that Kindler definitely received a rebate.

Kindler was wondering what the difference between a manufacturer's discount and a rebate is. He says a manufacturer's discount is a rebate.

Chesapeake Delegate John Cosgrove, R-78th District, agrees.

"He didn't get a check for the rebate and spend it. He used the rebate to reduce the sales price of the car. He never saw that extra money. He never put it in his pocket or put it in the bank," said Cosgrove.

The DMV that determines the tax cited the Virginia Code. DMV's Melanie Stokes wrote to WAVY.com and said, "DMV is required to record the price and collect sales and use tax of a vehicle before any type of rebate or discount. This is a Statutory requirement under Virginia Code Section 58.1-2402."

Delegate Cosgrove calls it a bad law and says he is going to try and change it.

"It's the way the law is. Just because we have been doing it that way doesn't make it right," he said. "There needs to be fairness in taxation as much as it possibly can. This is not fair the way it is now. I will have the bill drafted and it will go before the finance committee. I will use Mr. Kindler as an example."

Delegate Cosgrove says he will submit a tax change bill in January when the General Assembly meets. Cosgrove says you should pay tax on what you paid, not on what you could have paid.

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City Council explores property-tax rate

Posted: 02 Jun 2010 11:21 PM PDT

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Washington officials are targeting 50 cents per $100 valuation as the city's property-tax rate for the 2010-2011 fiscal year, which begins July 1.

That target was agreed on during the council's budget meeting Tuesday.

The new property-tax rate is scheduled to be set later this month when the City Council adopts the 2010-2011 budget. With a 4-1 vote, the council set the 50 cents per $100 valuation as its preferred property-tax rate. The city's current property-tax rate is 60 cents per $100 valuation.

The new property-tax rate, when adopted, will reflect the change in values of real property (land and structures) in the city as a result of the recent revaluation of all properties in Beaufort County, including those in municipalities.

After a revaluation, many counties and municipalities try to adjust their property-tax rates so they are revenue neutral, meaning the new tax rate when applied to the new property values generates the same amount of revenue as the previous tax rate and property values generated.

Matt Rauschenbach, the city's chief financial officer, determined that the revenue-neutral tax rate for the city in the upcoming fiscal year would be 47.44 cents per $100 valuation.

State law requires that after the city's budget officer calculates the revenue-neutral tax rate, then he or she increase that rate by a growth factor equal to the average annual percentage increase in the tax because caused by improvements since the last reappraisal.

"This growth factor represents the expected percentage increase i the value of the tax base due to improvements during the next fiscal year," reads the law.

Rauschenbach's calculations show that the revenue-neutral tax rate, adjusted for growth, comes to 48.56 cents per $100 valuation.

The target property-tax rate of 50 cents per $100 valuation reflects city officials' concerns the city could see some of its revenue sources not generate as much revenue as expected. Mayor Pro Tempore Bobby Roberson expressed concern that the Beaufort County Board of Commissioners may change the way it distributes sales-tax income to the municipalities in the county. That change could result in those municipalities receiving less in sales-tax revenues.

Also, actions by the General Assembly, now in session, could result in other revenue declines for local governments, city officials said.

Roberson said the city "might need that" difference between the 50 cents per $100 valuation rate and the 48.56 cents per $100 valuation rate to offset possible loss of revenue from other sources.

Councilman Gil Davis said not knowing what the county and the General Assembly might do leaves "a lot of question marks" surrounding some of the city's revenue sources.

Councilman Doug Mercer doesn't support the target tax rate of 50 cents per $100 valuation, preferring the rate of 48.56 cents per $100 valuation.

The new tax rate, whatever the amount, includes 2 cents per $100 valuation that's earmarked to provide revenue for the city's public-safety capital reserve fund, used to help pay for items such as new public-safety buildings and equipment. Mercer believes that allocation, now at slightly more than $120,000 a year, should be derived from the 48.56 cents per $100 valuation tax rate instead of the 50 cents per $100 valuation tax rate.

Under the 50 cents per $100 valuation tax rate scenario, the taxes on a house whose value increased from $100,000 to $130,000 as a result of revaluation would come to $650 in the upcoming fiscal year. That amount is $50 higher than the taxes paid on that house — valued at $100,000 and taxed at a rate of 60 cents per $100 valuation — this fiscal year.

Under the 48.56 cents per $100 valuation scenario, the taxes on a house whose value increased from $100,000 to $130,000 as a result of revaluation would come to $631.28 in the upcoming fiscal year.

The council meets again at 5:30 p.m. June 14 in the Council Chamber of the Municipal Building, 102 E. Second St.

For more coverage of the council's meeting, see future editions.

Whatever "revenue-neutral" tax rate the city adopts, about a third of city taxpayers will pay more in property taxes during the next fiscal year than they paid this fiscal year, according to city officials. Another third will pay less taxes, with the remaining third will paying about the same.

'Revenue-neutral' tax rate's

effects on property owners

While the revenue-neutral rate will generate the same revenue as the previous year adjusted for average growth, it will not result in the same real-property tax bill as the previous year for each property owner for the following reasons:

• Real-property owner's change in valuation is more or less than the city-wide average of 35.87 percent.

• Average rate of growth of 2.37 percent is included in revenue-neutral tax rate.

• In a revaluation year, the assessed value of real property equals its market value as of Jan. 1 of that year. In each subsequent year, the assessed value of real property (other than new construction) remains constant, though its market value typically increases. Personal property, in contrast, is valued at its market value each year. In a revaluation year, a realignment occurs in the tax burden between real property and personal property when both are reset to current market value. As a result, many individual real-property owners receive increased tax bills in revaluation years.

Sources: Matt Rauschenbach, Washington's chief financial officer, and the UNC School of Government.



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