Bloomington City Council approves countywide income tax hike

the Bloomington City Council unanimously approved a county-wide income tax hike – albeit slightly lower than what Mayor John Hamilton had proposed.

Council members’ vote on Wednesday raised local income tax by 0.69 percentage points, about a fifth less than the mayor’s proposed hike of 0.855 percentage points.

Upcoming higher property tax bills: Monroe County assessments rise by a record $1.9 billion

The 0.69 percentage point hike will mean about $345 more per year in income taxes for individuals or couples who, after various deductions, have a state-adjusted gross income of $50,000. That’s about $69 for every $10,000 earned in taxable income. The tax is a flat tax, which means you pay $69 for every $10,000 of taxable income, whether you earn $50,000 or $50 million.

The mayor had proposed spending an additional $18 million a year on public safety, climate change mitigation, equity and essential city services. Council action on Tuesday reduced that amount to $14.5 million.

Shortly after 9 p.m. Wednesday, Hamilton sat near the back of the council chambers, clapped softly and nodded to council members to thank them for their votes. He then stood up and shook hands with each council member.

Despite the sound reduction original proposalHamilton said after the game he was happy with the result.

“I think this is a major milestone for our community,” he said.

“Nine council members have nine different points of view, and I think we’ve worked very hard over the past few weeks to find a place to land that meets those points of view and the needs of the community,” Hamilton said. .

Council members were somewhat at odds over spending priorities and even the size of the hike, with some, including member Stephen Volan, favoring the mayor’s original proposal, while others, including Ron Smith and Dave Rollo, preferred a lower increase. Rollo proposed delaying the vote for another two weeks to find additional areas to cut in the mayor’s spending plan, but a majority of council members rejected that proposal.

How will the new revenue be spent?

Exactly how the money will be spent will be determined during budget negotiations. The mayor and city council members said they plan to use some of the money for pay raises for police officers and an east-west express transit line.

After the meeting, Council Chair Susan Sandberg said she was relieved the council had reached a decision after weeks of difficult negotiations.

“I lost sleep over it,” she said. “Glad it’s in the rearview mirror.”

She said she plans to ensure the money is spent on council priorities, including raises for police officers. The council is expected to ratify a new contract with the police union this month.

“Open Revolt”:Bloomington City Council threatens to reject mayor’s budget plan

The council increased the income tax over the objections of the Greater Bloomington Chamber of Commerce, whose chairman and chief executive, Eric Spoonmore, said the scale of the hike placed an “undue burden” on local workers. The chamber preferred a more modest increase of about $7 million a year.

Spoonmore said at Wednesday’s meeting that the hike proposed by the mayor and the one passed by council came at an inopportune time as local residents are already feeling a lot of financial pressure, from rising property taxes and housing prices. fuel to rising food and housing prices.

Some city council members said they shared some of those concerns, but they also said the income tax hike would allow the city to help some of the community members most affected by the hike. of inflation.

Raising Taxes for All Earners in Monroe County

Any income tax hike is technically supposed to be approved by the local income tax board, which includes members of the city, county, Ellettsville and Stinesville councils. However, the votes of council members do not count equally, as they are distributed according to population size. Bloomington is the largest of the four jurisdictions. Therefore, the vote of each member of the municipal council counts more than the votes of the members of other councils.

The eight members of the city council were able, on their own, to approve a tax increase.

Some county council members recently told the Herald-Times that they are also worried about the timing of tax increases and expressed frustration with the Indiana legislature because the law of the The state still allows the Bloomington City Council to unilaterally raise taxes for every earner who lives in the county, including those who live outside the city limits.

After:Some county officials question scope of Bloomington mayor’s income tax idea

Some city council members said they, too, didn’t like the system, but they blamed the Republican supermajority in the Statehouse. All city council members are Democrats.

The current county tax rate is 1.345%. Effective October 1, the rate will increase from 51.3% to 2.035%. Social security benefits are exempt from local income tax.

The tax will also generate additional revenue for the county, Ellettsville and Stinesville. Some county council members said at least part of the county’s share of $9.2 million will likely be spent on a new criminal justice center and new programs. Ellettsville will receive an additional $1.2 million, while Stinesville will be able to count on an additional $36,000.

UPDATE: This story has been updated with new revenue figures for the county, Ellettsville and Stinesville.

Boris Ladwig is the city government reporter for The Herald-Times. Contact him at [email protected]

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