The city of Moraine has an income tax levy coming up on the May 6, 2014 ballot that would increase the tax from 2 percent to 2.5 percent for a period of five and a half years. The city’s revenue, which has always depended on an income tax, has been in a steep decline since at least the year 2000, as many large employers left the south Dayton suburb.
“I know they lost lots of jobs from GM, so if that’s what it takes to make up for a little bit, I don’t have a problem with it,” says Jenny Koesters, who works at Chappy’s Tap Room in Moraine.
People who work in Moraine but don’t necessarily live there foot the bill for Moraine’s costs. City manager David Hicks says the city has always chosen to levy an income tax rather than a property tax because income taxes depend on the success of business in the area, while property taxes can remain steady even if people’s incomes decline. He also argues Moraine doesn’t have the luxury of being a bedroom community; the residents live with the physical consequences of industry, such as landfills, superfund sites and empty factory buildings.
The city’s revenue has declined by half, due largely to reductions in income tax revenue. In 2000, the city’s top ten employers had more than 17,500 people in their employ; by 2013, that number was down to 2,835 employees. As recently as 2005 income taxes generated almost $20 million for Moraine; this year they’re expected to produce just $12 million. But Hicks is quick to point out that state policy has a hand in the reductions, too: in 2000 they got $307,000 from the state of Ohio's local government fund, and by 2013 that was cut by more than half, to $141,000 as Governor John Kasich's budgeting process cut unprecedented amounts from local government.
“While it’s great that the state talks about balancing their budget, if you simply take money from other people to balance your budget, that’s not really being very effective in cost containment,” Hicks says. Governor Kasich has dismissed concerns from local governments about the loss of this money, which comes from state sales taxes.
Hicks says the city has closed a fire station, reduced the size of their vehicle fleet, reduced their workforce by a third and cut costs by 27 percent. The reduced workforce has come both from layoffs and attrition; they have 102 full-time employees, down from a peak of 157. In 2010, all city employees took a ten percent pay cut and stopped getting yearly increases.
“We don’t get everything done quite as efficiently or effectively as we used to, but our goal has been to insulate the public from the reductions,” says Hicks. “There are public agencies … that try to make the public feel the pain so that they’ll be supportive. We haven’t shared that philosophy.”
And even though Moraine has seen some good news this year with the announcement of a new tenant for the old GM plant, he says they’re replacing thousands of jobs with hundreds of jobs. Even as auto-glass maker Fuyao plans to bring up to 800 jobs to old plant, the job loss continues. Prime Time Party Rental, with 125 employees, is moving to West Carrollton. The Berry Company is moving 300 employees to Kettering, and the technology company Lastar was recently purchased, which leads to concern about its 225 employees possibly relocating. Another company with about 100 employees is considering a move; Hicks says they’re in negotiations, and didn’t disclose the name. Taken together, these departures could amount to essentially cancelling the income tax effects of bringing in Fuyao.
Just as Moraine is strapped for cash, so are some of its workers, and not all are eager to foot the city's bill. Back at Chappy’s Tap Room, host Ashlynn Kerney says she can’t handle another income tax. She’s a single mom, and she says she works constantly—for barely enough money.
“We’re paying all of these taxes and they keep tacking on more things...they need to figure out other ways to get what they need instead of taking from me,” she says, urgency in her voice. “They’re taking from me. They’re stealing from me.”