Transparency Translates to Trust: Tipp's Ten Year Capital Tax Levy

ARTICLE | Aug 8, 2016

Asking your citizens to reach into their wallets and pay a new tax, or extend what was billed as a temporary tax, is always an uncomfortable endeavor for any municipality. No matter how necessary the tax may be or the vital services it may help provide or result in the creation of, the process of selling it is tenuous at best. So when Tipp City needed to raise funds for capital improvements, they realized they had to come up with a plan to stay ahead of the narrative and clearly communicate to the citizens – create a level of trust and maintain transparency throughout the campaign and into the delivery of the projects. And what better way to do that than bringing the issue to the community, through community committees, ground and print campaigns, and building a coalition of advocates that represent what is best for the City. How did they do it?

The first step taken was to get those burning questions answered by the Miami County Board of Elections related to the steps and costs necessary to place the issue on the ballot. The ballot issue could have cost the community $6,300, but since that were three other issues to go before the public, the cost was only $1,575.00. Once the Council was satisfied with the cost of putting the issue on the ballot, the project was able to move forward.

Staff came up with a plethora of projects that needed to be funded. To get engage the community, the City Council wanted input from the resident as to what projects they felt were the most critical in addressing the quality of life issues, badly needed infrastructure improvements, and possible funding options. Therefore, a “Citizens Capital Improvement Review Committee” was formed that was comprised of twenty-one (21) volunteers whose task was to work with staff to evaluate that capital improvement projects to prioritize them, and if needed eliminate those that may not be worth of funding due to not being critical issues at this time.  The Council publically asked for volunteers to come forward to be on the Committee which was imperative to sell the public on where the levy funds would be used.  To fund the campaign for the Committee, contributions were sought from council and staff, vendors of the City, local business owners, and one local industrial company. In total the Committee raised $2,500 to spend on campaign materials.

The city rented buses and drove the committee members around the community to be able to put a face on the projects that were being suggested. Once the list was populated of the projects that were deemed critical to the wellbeing of the community, work sessions with power point presentations were presented during council work session, which were open to the public, indicating what projects the committee recommended for funding. The total cost for the recommended projects was a little over $20.0 million. Funding options were discussed which would save interest costs of $885,000 by paying cash for the project or utilizing short-term loans within the 10 year window that the levy is in place.

To get the word out, the city used the TippecaNews, which is a city news letter that goes out with the utility bill to explain as briefly as they could on how the city structured the income tax increase, justifications for the increase, and the plan on how the funds was going to be spent.  The streets that were slated for improvements over the next five years were listed as well as equipment and facility improvements.  To fund the capital projects, the city was asking that the income tax be increase by 0.25% and to extend the exiting park income tax of 0.25% to now be allocated for general capital improvement projects.

The increase was presented as a temporary increase that would expire in 10 years or about 2020/2021. A breakdown of the income allocation was also presented to show that 0.02% of the current income tax was going to Capital Projects and 0.25% (passed in 2002 and expired in 2012) was dedicated to Parks Capital Improvement which included land purchases and development. This in itself showed the public the commitment the city has made to improve the infrastructure and quality of life in Tipp.

The group “Citizens for a Strong Tipp City” came together to support and fund the campaign “Safety and Streets”. Financial assists was solicited to pay for the brochures, ads, and yard signs. Brochures describe the major projects that would be funded and the rational behind the projects. Post cards were sent naming the streets that would be improved in the first five years. Included were frequently asked questions from what the funds would be used for to who would and who would not be affected by the income tax. What other funding options that were considered in lieu of a tax increase. What grants were available to cover the costs of the needed improvements? A table was also included showing regional comparisons of income tax rates (cities in Montgomery, Miami, and Shelby Counties) and how Tipp City compared to them.

Various size newspaper ads were placed periodically up to the day of the election, in an effort to keep the issue in front of the voters. The City Manager at the time published articles on what the levy would be used for and how the funding would be allocated.

Support was solicited from the Tipp City Chamber of Commerce and Fire Fighters association.

The elected officials kept transparency throughout the whole process. As you can see the community was engaged through the media and represented by their neighbors who chose to serve on the Citizens Capital Improvement Committee that sat down with staff to discuss projects and to be able to justify how the funds were allocated based on critical needs rather than wants or what may appear to have been wants. Reading through the documents, the committee did cut some projects that were not deemed to be critical at this time. In addition, it was stated that a project would not be executed unless it could be paid off within the ten years of the levy. No debt carry over was to be allowed that would bind the citizens to having to cut services to pay for projects.

To carry through with the promises made, the city selected the projects with predominately large price tags, such as replacement fire truck, fire station renovations, and street paving projects and scheduled them in the first three year with the objective that they could be paid off in six to seven years using the levy proceeds prior to the levy expiring. The purpose was to show the community that the commitment was made and the city appreciated the support of the residents to be able to be good stewards of the public trust.

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