Avon to join RITA law­suit

The Morning Journal (Lorain, OH) - - FRONT PAGE - By Kevin Martin

Avon City Coun­cil ap­proved leg­is­la­tion on Nov. 13 to join hun­dreds of Ohio mu­nic­i­pal­i­ties in a law­suit against the state of Ohio over pend­ing changes to mu­nic­i­pal tax col­lec­tion.

Avon joins the Re­gional In­come Tax Au­thor­ity (RITA) with more than 300 mu­nic­i­pal­i­ties across the state of Ohio in the suit which chal­lenges the con­sti­tu­tion­al­ity of the state gov­ern­ment’s de­ci­sion to cen­tral­ize tax col­lec­tion au­thor­ity for net-profit busi­ness taxes in ad­di­tion to vi­o­lat­ing home rule pro­vi­sions which al­lows mu­nic­i­pal­i­ties to ad­min­is­ter and en­force its own in­come tax.

The pro­vi­sions are sched­uled to take ef­fect on Jan. 1, 2018. They will af­fect busi­ness own­ers who will file taxes with the Ohio Depart­ment of Tax­a­tion which will charge ad­min­is­tra­tion fees be­fore de­cid­ing when to re­dis­tribute funds back to the mu­nic­i­pal­i­ties af­ter charg­ing an ad­min­is­tra­tion fee.

While the state of Ohio stresses the move would save money and in­crease ef­fi­ciency, the suit as­serts the gov­ern­ment is over­step­ping its au­thor­ity.

The col­lec­tion of net profit tax rev­enue by the state of Ohio

would take away tax col­lec­tion au­thor­ity from the RITA who pro­vide tax col­lec­tion ser­vices to hun­dreds of com­mu­ni­ties.

On June 12, Coun­cil passed a res­o­lu­tion in op­po­si­tion of House Bill 49, the state’s bud­get bill. Fi­nance Di­rec­tor Bill Lo­gan

said at the time of the $2 mil­lion in net profit taxes col­lected by Avon, the “throw­back lan­guage pro­vi­sions,” which have since been elim­i­nated, would have cost the city $166,000.

Other mu­nic­i­pal­i­ties in Lo­rain County may fol­low Avon. Avon Lake has been highly crit­i­cal of the state gov­ern­ment over the past sev­eral months, with Avon Lake Fi­nance Di­rec­tor Steve Pres­ley char­ac­ter­iz­ing cen­tral­ized tax col­lec­tion as set­ting a prece­dent for the state to col­lect ad­di­tional mu­nic­i­pal in­come taxes down the line.

In April 2017, Avon Lake strongly crit­i­cized the state gov­ern­ment for its lack of guid­ance and mu­nic­i­pal over­sight over the time line for when the money would be re­turned. Avon Lake Mayor Gre­gory Zilka said at the time that the state gov­ern­ment lacked em­pa­thy for the con­cerns of lo­cal gov­ern­ment based on their ac­tions.

“This is an­other op­por­tu­nity for them to say they aren’t tak­ing any more money from us and that they are just go­ing to hold on to it for six months or a year,” Zilka said. “They would have ac­cess to those funds to help pay their bills at our ex­pense.”

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