Forget the arena, and we won’t need to raise the income tax

I do not support another income tax increase. That said, let me acknowledge it takes more political courage to support a tax increase than to simply say “no.” The purposes of the proposed income tax increase are to raise money for riverfront and sidewalk/alley improvements, and I am pleased that neighborhood improvements are finally receiving serious attention.

Because I share these same goals to invest more in our neighborhoods, allow me to go beyond “no” and outline how I advocate achieving them without tax increases. Sidewalks and alleys have been a regrettably low priority, and we have several financial tools at our disposal to invest in them now that we have the collective will to do so.

* The city currently has a budget surplus of approximately $6 million. This is due to a short-term strategy to replenish cash reserves, and this surplus needs to be accounted for when discussing a long term proposal like an income tax increase.

* As was reported last month, Allen County assessed values have increased by 3.1 percent this year. Although the City won’t know exactly how this increased property tax will monetize into new revenue for a few weeks, a 3 percent increase translates to roughly $3 million of new, organic growth that can be dedicated to infrastructure.

* Although the new state gas tax increase may sour drivers at the pump, it is an opportunity for the city to make proverbial lemonade. Again, we do not yet know the exact amount of new revenue the state will direct to the city from the new gas tax, but it is anticipated to be substantial. Of course, infrastructure improvements like alleys and sidewalks are the intent of this new state revenue.

The pitch for an income tax increase is that riverfront excites the public and will become a major economic development driver. This argument would be strong except that the taxpayer already pays such a tax- the Food and Beverage tax. Even after the Memorial Coliseum debt payments, the Food and Beverage fund has over $5.2 million of annual unencumbered income. It can be used for almost any economic development endeavor, provided it is a capital improvement. Through the Capital Improvement Board, the city controls half the votes for this fund, and the county controls the other half. We should not tap the taxpayer before approaching the CIB.

Of course, the administration has solicited the CIB to pay for the proposed arena, making additional riverfront development dependent on this new tax increase. I urge city leadership to listen to the public, who are clearly rejecting the arena. If we don’t sink all the CIB funds in the arena, we don’t have to raise income taxes. More importantly, we still have tens of millions of dollars to develop riverfront or other great opportunities our bright future will bring. <br>

<i> Russ Jehl is president of Fort Wayne City Council. </i>