Comparing the City and Schools Revenues and Their Respective Tax Issues

By Daniel Downs

If you haven’t read the News-Current lately, you missed an important announcement. Xenia Community School officials are putting their huge bond issue back on the ballot in May. As the News-Current noted, 59% of the voters rejected another large long-term tax increase to fund the building of new schools.

The big push by school administrators and our elected school board is for the building of large complex for the high school and other community organizations. Rebuilding schools that have been around since the time I was born, which was around the time God created the earth, are of secondary importance. Among those schools are Shawnee Elementary, my first school, Cox Elementary, my second, and Spring Hill Elementary. Oh, my, I forgot the administrators want out of that ancient administrative building on the East side like yesterday. What is not needed is the current plan for less than the best type of schools.

To top it all off, voters will be voting on the city’s 5.0 mill operating tax levy in February. Having talked to my council member, read the council minutes, and reviewed the latest annual financial report, it is obvious that the city needs more money to compensate for the rising cost of doing business. Inflation continually reduces what a dollar buys. I just don’t see the need for an annual increase from $417,000 to about $1.9 million. I would certainly vote for a renewal and possibly for an addition 1.5 mills. But, in a deep recession, any new tax increases don’t seem like a good idea.

Nevertheless, let’s look at the two tax issues.

A renewal of the city’s 3.5 mill operating tax levy would continue generating the same amount it has since 1959, which is $417,000. As mentioned above, the proposed replacement levy of 3.5 mills with an additional 1.5 mills means property owners who used to pay around $26 a year for property valued at $100,000 will now pay an additional $153, which breaks down to about $12 more a month. However, those figures only cover the 3.5 mills plus a 1.5 mills addition. They do not reveal the overall amount of property tax paid to the city. The same owner of a $100,000 home currently pays about $135 in property tax to the city. If the levy is passed, the same homeowner will be giving the city $288 a year.

As everyone who is making a buck knows, the city taxes every dollar earned at the rate of 1.75%. The income tax generates about $9 million a year. That is over and above the $9 plus million residents pay for like water, sewer, and sanitation services. So the current levy is a relatively small but necessary part of the city’s operating budget. Because of inflating costs, the 3.5 mill levy now is worth only .92 mills. In other words, the city needs more revenue in addition to the inflationary rise of income tax revenue, which this year may decline along with their earnings on investments.

During the 2006-2007 school year, Xenia Community Schools received almost $3 million from its 0.5% income tax levy. The school district’s combined property tax levies is 43.9 mills, which brought in about $20 million. A family whose home is appraised at $100,000 pays the school district about $960 a year in property taxes. The bond issue would increase that amount to $1,092.

To see the whole picture on taxes, it must be realized that the total property tax burden of the above homeowner is currently $1,504 dollars a year. The tax proposed by the city will increase it to $1,657. The school bond issue would increase it to $1,769. The same property owner also pays the Greene County Career Center a little over $75 per year, and the County around $316. To repave our deteriorating side streets, voters will have to pass a bond issue to cover the estimated $30 million in costs. Moreover, every working resident currently pays 2.25% of their income to the city and the school district. Without any deductions, a family with annual income of $60,000 pays out $1,500 in income tax. If state and federal income taxes as well as sales and gasoline taxes are accounted for, the tax burden of voting tax payer is getting little too heavy for this deep recessionary period. We can all give thanks to the federal government for it too.

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