Tiffin joins suit over tax collection
Tiffin City Council agreed to join a coalition of municipalities with a lawsuit that challenges the constitutionality of a provision in the bi-annual state budget which was approved by the Ohio General Assembly in June.
The provision would allow the state to administer the collection of net-profit taxes from businesses and potentially charge the city a fee for doing it.
Mayor Aaron Montz said the city would have no say in the matter.
Montz said the city views the investment as a low-risk, high-reward move because the possible benefits of being part of the lawsuit.
“The judge could rule it unconstitutional, or the judge could rule it unconstitutional just for the those involved in the lawsuit,” he said.
Howard said he was in touch with the attorney who is leading the cause and was told many cities believe the provision is contrary to the Ohio Constitution because it interferes with a city’s right to rule itself.
He said dozens of municipalities had joined the cause and it is likely the lawsuit will be filed in early November.
By joining and being a party to the lawsuit, Law Director Brent Howard said the city would have to pay $4,000.
Without any legal action, the change in how net-profit taxes are collected would go into effect Jan. 1.
Montz said the provision, which he said was thrown into the budget last minute and packaged with the rest of the appropriations, is “downright wrong.” He said the city has its own charter and should be able to collect taxes without state government interference.
Howard said legally, Ohio General Assembly bills are supposed to contain only one subject.
“Appropriation bills should only have appropriations,” he said. “That is one legal argument.”
Tax Commissioner Linda Neeley said many in Ohio, including the Ohio Municipal League, believe this move by the state government is just one step toward a system of more centralized tax collection, which would lead to less money coming to the city.
Finance Director Gwynn Reinhart also said the change in timing could hurt the city’s finances. She said the state may hold onto the funds for a longer amount of time before the city gets the money.
Councilman Jim Roberts said this was an example of the state trying to take advantage of municipalities.
“I’m tired of them balancing their budgets on our backs,” he said.
Howard and Montz recommended council approve legislation to join the lawsuit and it was unanimously approved.
New president pro tem
In other news, the council made Roberts the new president pro tempore of council through Dec. 31. The opening was a result of the September resignation of former council president Rich Cline. Councilman Mark Hayes, previous president pro tem, was appointed as council president, leaving an opening for the president pro tem position.
Councilman Tyler Shuff and Roberts were the only two members of council to express interest in the position. Shuff endorsed Roberts before council unanimously approved legislation giving Roberts the position.
“I think Councilman Roberts would make a fine pro tem,” he said. “It’s up to the group.”
Roberts said he has enjoyed his time on council and he believes he can handle the duty.
Council will have to decide again by the end of the year who will take over as president pro tem for the next four years.
In other business, Seneca Industrial and Economic Development Corp. President and CEO David Zak gave a quarterly update on the organization.
He said because of the great team at SIEDC and at the city, the economic development group can play its role to make positive things happen.
“Make no mistake, good things are happening,” he said.
Zak said 80 projects have occurred this year, including a $20 million expansion at American Fine Sinter.
He said about 40 more projects are in the pipeline, with some he hopes to announce before the end of the year.
Also during the meeting, Montz presented a gift to Reinhart, who was serving in her last regular council meeting before retirement.
Many council members and city administration officials expressed gratitude to Reinhart for her time at the city, which began in 2007.
Montz said Reinhart was someone people never wanted to argue with at city hall.
“She always has her facts straight and her ducks in a row,” he said. “We are really going to miss you. She’s a rock star in the Finance Department.”
Howard thanked Reinhart.
“I’ve seen a lot of different public officials,” he said. “One thing you did, you made us better at what we did. You did your job so well … it’s the mark of a remarkable person.”
Jen Miller is to take over for Reinhart Jan. 1.
“I know I’m leaving the city’s finances in good hands with Jen,” Reinhart said.
Reinhart also gave her final finance report to council. She said the city’s income tax revenues were down 6.9 percent through September 2017 compared to through the same time last year.