This story has been updated to correct an error. See correction at bottom.
If efforts to abolish property taxes in Ohio are successful, townships may have only one option to continue funding services: become cities.
Townships are mostly funded by property taxes — about 66% — according to the Ohio Township Association. They use those taxes to pay for services like police and firefighters, road and cemetery maintenance, and waste disposal.
As a city or municipality, those governments could impose income taxes on residents to fund those services instead.
“This whole thing of just doing away with property taxes without (coming up with a way) to supplement what you’re taking away is just insane,” said Randy Gonzalez, a former longtime Jackson Township fiscal officer and trustee. “What would happen to these townships? They would literally have to file bankruptcy.”
Gonzalez was once a major proponent of Jackson Township — a community of about 43,000 people — becoming a city in the early 1990s when he was a township trustee so the community could adopt income taxes. But he now opposes incorporation because of the bureaucracy he believes it would create.
A constitutional amendment to abolish property taxes could appear on the November ballot if the grassroots group pushing the effort collects the necessary 413,000 signatures.
But the debate, spurred by soaring property taxes in recent years, has prompted fear for townships and schools, and a new bill from state Rep. David Thomas, R-Jefferson and state Rep. Adam Matthews, R-Lebanon. The legislation would eliminate the requirement that townships get the support of nearby cities to become cities and leave it solely for the township’s voters to decide whether to incorporate.
Townships are eligible to become cities if they meet certain population, density, size and property tax criteria set by the state. Under this bill, townships, of which there are about 1,308 statewide today, would need at least 5,000 residents to incorporate as a city, and at least 1,000 people per square mile.
In the most recent example of a nearby township becoming a city, Green Township in southern Summit County, voted to merge with Green Village in 1991, and became the City of Green the following year.
“Some townships may want to streamline and lower the threshold to incorporate into cities, especially in light of the proposed referendum to abolish property taxes,” state Sen. Jane Timken, R-Jackson Township, said in a statement. “Incorporating to a city has challenges as well. In the legislature, we have to be willing to come up with solutions to help solve the problem. I am happy to work with our local townships on a solution.”
State Rep. Jim Thomas, R-Jackson Township, a former Jackson Township trustee, wrote in a text message that he is not familiar with the process by which townships can become cities. And that he would have to look into the proposed bill.
“My hope is that the constitutional amendment to abolish property taxes in Ohio will fail,” he wrote. “Many important items are funded by property taxes including schools, police and fire, libraries, etc.”
Trustee: Abolishing property tax would ‘devastate’ townships
Jackson and Plain Township officials are not enthusiastic about their townships becoming cities.
“Township form of government is the least expensive form of government to run,” Jackson Township Trustee John Pizzino said. “… We have all these services that the city has other than trash pickup and water and sewer.”
Stark County has some of the most populous townships in the state in Plain, Jackson, Lake and Perry — in some cases with many more people than existing cities.
But Plain Township Trustee John Sabo said he doesn’t believe becoming a city is a solution. Plain’s population is about 35,000, according to the Ohio Township Association.
“Township government is already the most efficient form of local government in Ohio,” he wrote in an upcoming op-ed that will be published by the Canton Repository. “Our residents choose to live in Plain Township and not neighboring cities. Incorporation would dramatically increase costs and responsibilities.”
Township voters in Stark County have rejected proposals to become cities in the past. Perry voters defeated an issue in 1991, while Jackson and Plain voters rejected proposals in 1998 and 2010, respectively.
If the townships became cities, they under state law would have to have a mayor, a city council with an elected council president, an elected law director, an elected auditor and an elected treasurer. And each of those city officials like in Canton would have a paid staff whose salaries are paid for by taxpayers. To deviate from that state-mandated form of government, the new cities would have to go through a multi-step process to establish a charter government.
The new cities would have to take over the maintenance of several state and county routes, bridges and culverts. The police department of whatever city Jackson Township became would be responsible for policing the section of Interstate 77 going through its territory, an area now policed by the Ohio State Highway Patrol.
Sabo said complicating matters, all of Plain Township could not be incorporated as one city. Because not all of the township is connected due to decades of annexations by Canton and North Canton. The contiguous northeastern Plain Township could incorporate. But the southwestern part, which includes the Avondale neighborhood, could perhaps incorporate as a village.
Jackson Township Administrator/Law Director Mike Vaccaro said property taxes, including a police levy, fire levy, road levy and park levy, fund about $35 million of the township’s $78 million operating budget. The rest comes from state local government funding, gas tax, vehicle registration fees, fees and income tax revenue from joint economic development agreements with Canton.
Sabo said about 40% of Plain Township’s roughly $40 million annual budget is funded by property taxes, which pay for the township’s contract for policing by the Stark County Sheriff’s Office, the fire department, emergency medical services, the parks and maintenance of the roads. He wrote abolishing property taxes would “destabilize every essential service we provide” and would be a “gamble with public safety.”
Gonzalez, Vaccaro and Sabo said they were open to a different idea — the state legislature could give townships, or at least large townships like theirs, the power to adopt income taxes with voter approval without requiring the townships to become cities.
Reach Robert at robert.wang@cantonrep.com.
Correction: The population of Plain Township is about 35,000, according to the Ohio Township Association. An earlier version of this story had an incorrect figure.
This article originally appeared on The Repository: If property taxes are abolished in Ohio, would townships look to become cities?
Reporting by Victoria Moorwood and Robert Wang, Cincinnati Enquirer / The Repository
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