Discussions regarding the City of Delaware’s latest income tax increase proposal continued during Monday’s meeting of the Delaware City Council with a second reading and public hearing for the proposed ballot language.
Currently under consideration is an increase of 0.45%, which would increase Delaware’s income tax rate from 1.85% to 2.30%. As part of the proposal, the income tax credit for those working outside of Delaware would also increase from 50 to 65%.
Last month, a resolution was passed to repeal the previous language the council approved in May in order to present a more concise message of how the additional funding would be used in the city. The original version of the proposed ballot language included wording that allowed the city to use the dollars generated by the increase for “general municipal services.”
After a unanimous vote by the council last month, the “general municipal services” aspect of the resolution was removed and now only includes funds being used for the “purposes of paying the costs of capital improvements, maintenance and repair of streets, and the payment of securities issued therefor.”
Monday’s meeting included a presentation detailing what the additional funding would mean to the city, as well as the implications should the levy fail again. During the presentation, Director of Management, Budget, and Procurement Alycia Ballone said the proposed levy would generate an additional $7.6 million to fund improvements to the city’s infrastructure. Along with the existing levy and current capital, the city would have approximately $9.5 million in total available. Ballone proposed allocating $5.3 million for street maintenance and repairs and $4.2 million for capital improvements.
Under Ballone’s allocation proposal, the city would target 10 miles of roadway paved each year. Through the first five years, the city would focus primarily on the backlog of streets rated in poor or critical condition. Ballone also noted the additional funding would allow the City to apply for grants it may not be able to currently seek due to the lack of local funding required to match the grant amount.
Another project highlighted by Ballone as a focus should the levy pass was the Central Avenue and Lake Street intersection, a project that may not otherwise happen given the grants required and the City’s current inability to put up the matching funding to apply.
Priorities for capital improvements include continued care for Oak Grove Cemetery, which the City is mandated to oversee. Also included is the maintenance of pedestrian and bicycle trails, recreational center upkeep, replacing the Justice Center roof, resolving the center’s plumbing issues, and enhancing public safety throughout the city with upgraded equipment.
Comments from the public during the hearing included praise for the increased tax credit, wishes for more public education forums to dispel misconceptions about the proposal, and concerns about the impact the levy could have on those who live and work in Delaware, and future economic development due to the increased burden placed on those people.
In addition to the tax levy, the council is also currently considering a resolution that would eliminate the tax credit entirely should the levy fail in November. Ballone said the credit elimination would generate upwards of $6 million to help the City address its shortfall in funding.
The ordinance will be given a third reading during the July 22 meeting with a vote expected following the reading.
Reach Dillon Davis at 740-413-0904. Follow him on X @DillonDavis56.
