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Posted on: June 11, 2018

Safety Tax FAQ

Safety Tax FAQ

1. What are the details of the proposed tax?

If Council votes to move it forward, the City would be asking voters to approve a one-half percent increase in the municipal income tax for 10 years.  This tax would be in place from 1/1/19 through 12/31/2028 and could only be used for safety purposes.


2. What would the tax money be used for?

It can only be used to support our safety forces (police, fire, ems, and dispatch).  First, we would be constructing a safety facility to house all these departments.  Next, we would set up a savings account for future maintenance of that building, because it won’t be new forever.  After that, there would be money for additional training and to support any safety related needs.


3. Didn’t you just ask for an increase in taxes?

No, the City’s income tax rate has been the same since 1971.  The City has not asked for an increase in property tax since 2012.  The tax issues on the ballot in the past two elections have been from the School District, which is separate from the City.

4. How much would this increase my taxes?

This depends on where you live, work, and how much income you earn.  A couple of examples are below:

  • No taxable income (retired, full-time student, unemployed, etc.) – $0 increase in taxes
  • Live in North Canton, but work in Canton, Green, Akron, Louisville, Massillon, or any other City with a tax of at least 2% - $0 increase in taxes
  • Live in North Canton and work in North Canton or in a township - .5% increase in taxes; if you made $50,000 per year this would be an extra $250 per year or a little under $5 per week.

5. How much would this cost an owner of a $100,000 home?

There would be no change to your property taxes, this is all based on income.  See question #4.

6. Where do you plan to put the new facility?

Since we don’t know if voters will support this 10-year increase in taxes, we don’t know if we’ll have the funds to move forward and obtain the land.  We don’t want to reveal an exact location at this time so that we can negotiate a fair price for the property.  However, we do have at least 4 properties in mind and all are on or near Main Street.  We want to eliminate the need for sirens and fast moving safety vehicles to constantly be in a residential area, as they are now at Station 2 on 7th Street.

7. How can I hear more information or ask questions about this tax?

8. What will happen to the existing safety facilities?

Fire Station 1 on Main Street could be the site of the new facility, but if not, it would likely be sold. Station 2 on 7th Street started out as a Park/Rec building and could be reincorporated into the park system (especially with the project that will already be going on around it at Dogwood Park). The police space in the basement of safety hall could be used as additional office space for city hall operations. The offices that are in the Civic Center could be moved there, freeing up Civic Center space to be rented, as the rest of that facility is. Even if we end up using 2 of the 3 old spaces for another use, we still expect to see utility savings, as we'd be putting all the 24/7 operations into the newest and most efficient building and using older, less efficient buildings less hours a day or week.

9. What about the property taxes we have in place for Fire and EMS?

Those levies would remain in place, as they fund fire/ems operations and building maintenance today. Long-term, if we have maintenance and operational savings from a combined facility, that helps us keep up with increases in wages and benefits while property tax revenue tends to stay fairly flat. Also, part of the new tax will be set aside in a special account over 10 years for the future maintenance of the new building (after the 10 years is up and tax expires) so that helps the City avoid coming back for more taxes down the road.

10. Didn't you just refurbish the EMS building-Station 2 on 7th Street?

There was an addition put on the back of Station 2 last year, to allow for separate dorm space as we have more and more females on the department and they are there 24 hours per shift. Station 2 will likely be incorporated into the larger plan for Dogwood Park/Pool area, so the extra square footage won’t be lost, just put to another use. The furniture, appliances, etc from that project could easily be moved to the new facility and used there.

11. What are the projected savings by combining multiple facilities into one?

Just by closing one of the Fire/EMS stations, we would eliminate about $50,000 in annual costs related to utilities, maintenance contracts, and other duplicated costs. In addition, the Fire Chief has a smaller pool of "volunteers" (they are paid, but only come in on fire calls) than in the past. He supplements fire calls with our cross-trained EMS employees, but they have to respond from the EMS building or from a prior EMS call that they may be finishing up. By putting all equipment and employees in one facility, it would help us avoid the need to have more full-time staffing at just the fire station. One full-time fire/EMS employee costs the City about $90,000 per year in salary and associated benefits.

12. If the building costs less than anticipated, or if income tax revenue continues to increase over the ten-year period, could we pay off the debt early?

Yes, we can issue bonds for 10 years with a “call” option after 7 or 8 years.  There would be no penalty for prepayment of the bonds at that point and we would save interest costs for the last 2 or 3 years.

13. Did you consider using property tax to fund the facility, rather than income tax?

It was considered, but ultimately, City staff decided to present only an income tax option to City Council and the public.  The reason was that to generate the same amount of revenue per year, we would have had to ask for about 6 mills of property tax.  The school district just received voters’ support on an increase of 6.9 mills for their operations, and that is their main source of income.

14.  How many mills of property tax are already in place for safety services?  Would those taxes continue?

The City has 2.4 mills for the general fund, which supports Police and Dispatch.  There is .5 mills for Fire and 2.5 mills for EMS.  These existing property taxes would continue as they support the operations of each department.  Because this new income tax is only for a 10-year period, the departments won’t be depending on it to fund operations long-term.


15. What about reducing the credit for taxes paid to other municipalities, instead of raising the rate?  Did you consider changing that reciprocity?

It was considered, but has a negative impact on more North Canton residents that raising the tax rate does.  Municipal (city) income taxes are first paid where you work, and only about 30% of residents live and work in North Canton.  Using the same examples from question 4, but instead of raising the rate to 2%, we instead eliminate the credit, it gives the following result:

  • No taxable income (retired, full-time student, unemployed, etc.) – $0 increase in taxes
  • Live in North Canton, but work in Canton, Green, Akron, Louisville, Massillon, or any other City with a tax of at least 2%, making $50,000 per year - Continue paying 2% or higher from each paycheck to the city where you work; Now you also have to file quarterly, as you would owe $750 extra per year, due each quarter to RITA
  • Live in North Canton and work in North Canton or in a township - $0 increase in taxes

16. Is the public going to have enough time to weigh-in or will you just pass this on emergency next week?

City Council is taking a very close look at this proposed tax.  They have had two Committee of the Whole meetings where the tax was presented by the Finance Chair from her committee.  Council plans to have 3 separate readings of the legislation, with a chance for the public to speak at each meeting (6/25, 7/9, and 7/23).  At that point, Council could vote to place the levy on the November ballot and must do so before August 8th.  Voters would then have at least another 90 days to comment and ask more questions about the levy before voting on November 6, 2018.

17. Some City officials were against the levy last fall, but are now considering asking voters for this tax.  What’s the difference?

Issue 44 last fall was a tax request from the School District, while this is a City tax.  That levy was a combination of property and income taxes, while this levy is only income tax.  School District tax is based upon where you live (meaning all residents of that School District pay) whereas City tax is first based upon where you work (meaning only some residents pay; see question 7 above).  Issue 44 was continuing, or a permanent tax, while this levy is for 10 years and would expire on 12/31/2028.

18.  How do residents know that the City won’t just ask for this tax to be renewed when the 10 years is up because by that time the building needs some upgrades or maintenance? 

Part of the money to be generated by the levy will be placed into a special account for the future maintenance of the facility.  We will save enough money there to maintain the building well into the future.  When the facility is constructed, we will ask the architects and construction managers to provide us with estimates of future repair costs on major components of the building (such as how much a replacement roof would be or replacing the HVAC down the road).  This listing will be used to ensure that enough money is put aside for those needs that will be much further than 10 years away.

19.  Will the money from this levy be placed in the general fund and used for operations?

No, by law the money will have to be placed into a special fund and only be used for safety purposes.  After the debt and building maintenance is funded, any extra revenue would be used for one-time purchases such as specialized training, or a new technology that would increase efficiency and/or safety long-term.  Because the tax expires after 10 years, we would not want to use this money to pay personnel or for other ongoing costs.

20.  Much of the discussion has focused on residents.  How does this impact a business owner?

If a business is earning a net profit in North Canton, the tax on that net profit would increase from 1.5% to 2.0%.  In addition, if the business has employees working in North Canton, the business would withhold 2% instead of 1.5% from their employees’ paychecks, but the financial impact of that is on the employee, not the business itself.


21. Could the City use a sales tax to fund this project?

No, in Ohio only the State or a county can levy a sales tax.  Cities can only ask voters for property or income tax.


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