Taxation without representation: Township should be folded

Apparently, you can have it both ways in Ohio. Selective income taxes are apparently OK if your township can’t pay the bills. Taxes that are being passed without a vote by the public.

The concept of urban townships is a farce that has been allowed to continue so we can supply income tax havens for the wealthy. There is absolutely no legitimate reasons for this form of government in urban areas – where the services are a hodge-podge between the county and the township. The cutoff in Ohio is 5,000 residents- with the main difference (until now) is that only cities can levy income taxes.

From today’s Dayton Daily News:

Walmart and Sam’s Club on Miller Lane agreed to an employee income tax that will help pay for police services, township trustees said Tuesday night.

The sister retailers called the township Friday and said they would become part of a Joint Economic Development District with Vandalia, paying income taxes estimated to be about $258,000.

Townships, which can not collect taxes, enter into these agreements with cities. Butler will collect 85 percent of the tax revenue, while Vandalia keeps 15 percent as fees.

“Nobody wants to put a levy on the ballot,” said Trustee President Michael Lang. “To me, this is a complete game-changer. We hope in a short amount of time to get the other businesses in the JEDD.

“We may still need a levy in the spring, but we have time to see where this puts us.”

Butler Twp. has been operating its 14-member police force on $1.1 million budget generated from a previous 4.9 mills levy, while also supplementing that money with an average of $350,000 yearly from its general fund. A 3.0 mills levy was estimated to generate $695,303 in new money, but that was before home values tied to the levy were downgraded last week. The extra revenue was going to go into the township’s general fund.

Trustees said they were looking to Miller Lane businesses for help since those businesses account for more than half the township’s police calls. The township has already laid off one officer, and Chief Danny Hobbs retires at the end of the month, further reducing the staff to 13.

It was feared without a levy or a JEDD, the police force would have to be further reduced next year.

“They (Walmart and Sam’s) understand the importance of this,” Trustee Martin Russell said. “They don’t want services reduced.”

via Butler Twp. cancels police levy after 2 retailers agree to JEDD.

The real question is how many property tax abatements were granted along Miller Lane to “lure” jobs in the name of “economic development.” The Benchwood Road exit was an earlier version of the Austin Road exchange, adding more sprawl and unneeded retail space to an already overbuilt market. We will soon see the same problems for Miami Township thanks to their manipulations at Austin Road.

This “agreement” to collect income taxes for the Township made by members of the Township and Walmart- should be questioned in the courts. The trustees should be tossed from office- and ultimately, the township should be disbanded and merged into Vandalia (the taxing authority) immediately.

How the citizens of this community can stand idle while this kind of back room shenanigans take place is one of the reasons “Greater” Dayton is such a dysfunctional mess. If we moved to a “One Dayton” regional government, we wouldn’t be having this kind of BS going on.

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17 Responses

  1. Rufus Dogg August 10, 2011 / 10:34 am
    When I moved to Dayton (Englewood) 21 yeas ago for Huffy (where are those jobs now?) I was flabbergasted at how fractured the community was into townships and little cites abutting each other.. and nobody seemed to want to work together on anything. Clayton v Englewood anyone? If you drive down Main St. from Englewood to Dayton after a snowstorm, you go through several municipalities, all plowing at differing levels of quality. This is INSANITY.

    What I have come to understand in the past 21 years though is it is all set up like this to give smaller groups power. They start off as volunteer coaches at the SAY soccer team by bullying parents. When that power is not satiated, they move up to school boards, city councils, county commissions, non-profits masquerading as do-good organizations, etc. The population here in Dayton is not big enough for this many chiefs… but it is big enough to always carve out a place where the bully with an insatiable appetite for power can find a home….

    And since Dayton is about as far removed from any media scrutiny — including our own local press — this continues on just underneath the surface and occasionally bubbles up as some crime that gets quickly smacked down. Right after a scapegoat is routed out and slaughtered. And it continues….. 

  2. Bubba Jones August 10, 2011 / 10:47 am
    David, I think you missed a HUGE issue on this one.  Read this and tell me what’s missing….
     
    >>> Walmart and Sam’s Club on Miller Lane agreed to an employee income tax that will help pay for police services <<<
     
    I bolded the pertinent words just to help you out.  This is an income tax levied on the employees’ wages (totaling approximately $14,250,000), not the income of the WalMart and Sam’s Club local store operating profits!  So the employees of those two businesses are paying for the police protection of the businesses on Miller Lane.  And, Vandalia’s city income tax rate is 2%, so the employees’ are effectively taking a 2% pay cut.  Something doesn’t smell right.
     
    I may be missing something on this, but I saw nothing in the article that indicated that Sam’s and WalMart would be paying an income tax on their net profits.  Pretty sweet deal to get your employees to pay for your police protection!
     
    Robert Vigh, Jesse, Ice Bandit – HELP ME OUT HERE!!  This response is making me sound like a bleeding heart liberal! LOL!
     
    By the way, David, this statement >>> The concept of urban townships is a farce that has been allowed to continue so we can supply income tax havens for the wealthy. <<< ranks in the Top 10 of the dumber things that you’ve said on this site.  Butler Township is hardly a place where the wealthy congregate.
     
  3. Eric August 10, 2011 / 11:54 am
    …and given Esrati’s stunning record of brilliant political insight and his long history of electoral victories, the Butler Twp. Trustees would do well to take heed!

    No… Wait…

    One question: who would rather live in the cesspool of Dayton than in Butler Twp?

    I dind’t think so…

  4. David Lauri August 10, 2011 / 12:40 pm
    Eric asks, “who would rather live in the cesspool of Dayton than in Butler Twp?”
     
    According to a Dayton Daily News article, “More living downtown as revitalization efforts pay off,” there are indeed people who would rather live in Dayton, at least downtown, than in Butler Twp. The article points out that downtown and the Oregon District added 567 people over the last decade, not a huge increase, but an increase nonetheless.
     
    Conversely Butler Township’s population declined from 8,382 in 2000 to 8,242 in 2009 (source).  Perhaps some of the 140 people who left Butler Township moved to downtown Dayton.
  5. joe_mamma August 10, 2011 / 12:55 pm
    “I may be missing something on this, but I saw nothing in the article that indicated that Sam’s and WalMart would be paying an income tax on their net profits.  Pretty sweet deal to get your employees to pay for your police protection!
     
    Robert Vigh, Jesse, Ice Bandit – HELP ME OUT HERE!!  This response is making me sound like a bleeding heart liberal! LOL!” Bubba Jones

    I don’t claim to be in their league but…

    for business and employees taxes are the same, a cost of doing business.  They can either pass on the cost to their customers/employers or cut other costs to maintain competative prices and profits. 

    The current tight job market gives employers an advantage in moving costs to employees and facing little to no turn over in the short term because of it.

  6. Joe August 10, 2011 / 1:00 pm
    I moved from Butler Twp. to downtown in that period! Lived with my dad for a while after college until I got regular work.  He lives in Butler twp because of a variety of reasons. We moved out of West Dayton in the late 80’s because of crime in our neighborhood and toward better schools. Now that we are all out of school and moved away he’s already there – why move again? Less taxes for his business which he runs out of his home, likes the area and has gotten use to it. We were not looking at a “haven for the wealthy” but mostly for the schools, lower taxes may be part of it now – but I think he’d be ok with paying whatever taxes were assessed if he was in a different area.

    There are some very wealthy people/neighborhoods in Butler township. I wouldnt say everyone is though, it’s a mix. That demographic data is certainly available somewhere.

    Butler twp and Vandalia had a merger on the ballot a few years ago and it was rejected I believe. Vandalia processes taxes for several local municipalities, sort of a regional arrangement they have with other municipalities. I’m sure they take a cut of that too.

    Maybe townships should be elminated. Dont think it will happend though, to many people entrenched in local positions of power. And no suburb wants to be any closer in associating itself with Dayton in anyway, which is to bad. I like living in Dayton proper, alot of that attitude is based on prejudice and irrational fear. I’m all for a stronger county goverment.

  7. Bubba Jones August 10, 2011 / 3:36 pm
    I don’t claim to be in their league but…
     
    Ahh, but you ARE in their league!!  I was trying to think of one more right thinking individual to add to the list but had a senior moment and couldn’t think of you! :(


    for business and employees taxes are the same, a cost of doing business.  They can either pass on the cost to their customers/employers or cut other costs to maintain competative prices and profits. 
    I do agree that taxes are a cost of doing business – for a business. I hadn’t really thought of it that way for an individual but I do see your point.  What sucks for the employee is that they didn’t have a say in it and they’re taking a 2% hit.  Of course, corporations don’t have a say in tax rates so when theirs go up, that cost is passed on to either the customer in the form of higher prices and/or passed on to employees in the form of lower wages.
     
    The current tight job market gives employers an advantage in moving costs to employees and facing little to no turn over in the short term because of it.
     
    Yup, you are exactly right.  My guess is that the majority of these WalMart / Sam’s employees aren’t in any position to run out and replace their current jobs.
     
    One other thing that came to me as I was reading the comments on this thread was that other municipalities might end up indirectly paying for much this cost of the Butler Twp. Police.  Let’s say that “Walmart Bob” works at the Miller Lane store but lives in Dayton. He makes $10 an hour or $20,000 per year. So, as a Dayton resident, his wages are subject to a 2.25% income tax which Walmart is currently withholding from his check and remitting to Dayton.  That’s $450 that Dayton gets from Bob’s paycheck.  Dayton and most other local municipalities give a credit to residents for taxes paid to the locality that the resident works in.  Once the Butler Twp. agreement goes into effect, Bob will still have the same $450 withheld from his check but $400 of it ($20,000 * 2%) will go to Butler Twp. and only $50 ($20,000 * .25%) will go to Dayton.  So, indirectly, Dayton ends up paying for Butler Twp’s additional police personnel.
     
    Ultimately, the WalMart / Sam’s employees that currently live in taxing municipalities will notice very little change in their paychecks but the ones that live in non-taxing districts will tax a 2% hit.
  8. David Lauri August 10, 2011 / 5:42 pm
    The Dayton Daily News article about Butler Township’s new JEDD with Vandalia fails to mention that Butler Township already had a JEDD with the City of Dayton, established in 2007 (see http://www.cityofdayton.org/departments/finance/Pages/JointEconomicDevelopmentDistrict.aspx) . I wonder if a township can have multiple JEDDs with different cities or if the new JEDD with Vandalia will replace the one with Dayton.
     
    In addition to the JEDD it had with Butler Township, Dayton also has a JEDD with Miami Township (see same link in previous paragraph).
  9. Civil Servants Are People, Too August 10, 2011 / 5:49 pm
    I agree completely.   The urban townships are unsustainable and inefficent.   This type of deal only delays the inevitable.    That goes for some of our smaller cities as well.

    Bubba makes a great point that this deal will COST money for the other communities as well, when you talk about existing jobs.   (New jobs would be a different story, in theory)    Will we see a protest from our so-called leaders?
     
    @Eric – there are still over 140,000 people who choose to live in Dayton.    Show me another community between here and Cincinnati that can say that.   There are good and bad neighborhoods in every city.

  10. Mark Wasson August 12, 2011 / 7:18 pm
    I had a similar reaction as Rufus Dogg did to all the township governments when I moved to the Dayton area in ’86.  I had lived in 7 locations in Iowa, Illinois and Minnesota before then, and although townships existed in all those areas, they were historical artifacts rather than functioning government jurisdictions (they did have functioning governments early on).  I now live in Washington State – if townships exist in this state I’ve never heard of one.  In all these locations, if you didn’t live inside city limits, the county was your local government.

    I’d think that those who think we’ve got too much government or pay too much in taxes would be chomping at the bit to get rid of a layer of government and its associated overhead costs and redundancies.  Especially since other states have shown that township-level government isn’t necessary.

  11. gary August 12, 2011 / 7:49 pm
    If you are not here to enjoy Dayton for the better, please leave then!

    JEDD = The Fed = rip offs!  Con Men!  Con women!  Phony bussinessmen and women … :-( = scammers …

  12. Truth August 12, 2011 / 9:43 pm
    First off, Vandalia doesn’t want Butler Twp.  The proposed merger was turned down for two reasons…
     
    1.  Twp residents didn’t want an income tax..(even though many of them were too dumb to realize they are already paying income tax where they work…The percentage of Butler Twp resident that actually work in the Twp is VERY small, sans the self employed or those that claim income where they please… sales/drivers/etc,)
     
    2.  It was going to cost Vandalia a fortune…to provide Twp residents with the same service they provide Vandalia.
     
    They need to build a wall around Miller Ln. and fill it with water.  It is nothing but a drain on services and has turned into an area that the “money” doesn’t shop at.  Many Vandalia and Butler Twp residents will avoid shopping there and head to Englewood or Huber
     
    Butler Twp got themselves into the mess by inappropriate usage of TIF funds.  They have a police chief that is on of the highest paid in the area to manage a staff of barely over a dozen.  They have been sued numerous times for flagrant law violations, ie.  placement of random speed limit signs in unlawful ways, etc.  They now are laying off cops, when they are lucky to have more than two working at any one time.
     
    Butler has become an armpit with a few nice residential areas.  Until they provide adequate service to force the turds back to Dayton, they will continue to have the image of hookers, drugs, and ignorance all along their “face” called Miller Ln.
  13. J Dziwulski August 12, 2011 / 11:27 pm
    “The urban townships are unsustainable and inefficent.”

    ….says the Civil Servant. Of course the Civil Servant wouldnt like them since they generate less taxes to subsidize more local government..ie more civil servants like him or herself.

    That was the reason the Washington Twp/Centerville merger effort failed. Washington Twp people didnt see the benefit of adding another layer of taxation when they are already getting a sufficient level of service from their township and county-level government.

    Maybe its entities like Centerville that are inefficient.

  14. Greg Hunter August 13, 2011 / 2:04 pm
    Maybe its entities like Centerville that are inefficient.

    Absolutely – The township has very few sidewalks and storm sewer systems.  Walk on the streets and stormwater is collected in grass swales…. less pollution for streams, less erosion on streams…less tax assessments and the less pay offs from elected officials to their benefactors….you know like Nan getting paid off by a construction debris contractor….Work with nature and you get less tax assessments and less abuse…. 

  15. truth August 13, 2011 / 11:01 pm
    The fact is that the township citizens wouldn’t be adding a “layer” of taxes.  They would be dropping a “layer” and adding a “layer”.  Basically, the township millage would be gone and income tax would replace it.  Many of the residents wouldn’t even being added a layer because they are paying earnings to Dayton, Vandalia, Englewood, etc…

    Considering most people have a residence that costs more than their yearly income, they end up taxed more on the property, than on income.

    Here is the skinny…a Butler Twp resident that works is most likely paying income tax in another city.  So they are paying earnings tax.  (And people that live in the township but live elsewhere are still paying when they file to their community)  Then, they are paying 4 times more tax to the township on property, than a Vandalia resident pays to the city.

    I have a problem with the statement reference inefficient cities in relation to townships.  If the revenue generated by say, Butler Twp. on property tax, is more than the revenue that Vandalia generates on income, per captia, then why do township services suffer when they don’t even provide all of the services that the city provides.  They don’t maintain all of their roadways and infrastructure, and many services such as parks an recreation, are piggybacked off of the city.  Not to mention, their public safety services, primarily police, have half of the daily manpower as their incorporated counterpart.  Yes, Vandalia has more population, but much lower call volume.  Given that, the residents in the city, are getting MUCH more bang for their buck.  The counter argument from the township folks…”My property value is higher than yours.”  Really?  I wonder why.  If it wasn’t, the township millage would have to increase to make up for lower values to even survive.  Numbers can be manipulated in any way, and the county in cahoots with the townships is no different.

    So, how to you make the argument that the township is run more efficiently, when they continually cut services, with more tax?  A Butler Twp resident on a 100k house pays over 640 a year in tax to the Twp, while a Vandalia resident pays about 160.  So effectively, a Vandalia resident pays less than half to the city than a township resident pays in JUST PROPERTY tax.  Not to mention, the only way you can possibly pay less in Butler is if you live and work in the township and your income is much more, 2-4 times, than your home value.

    Reference millage: http://www.mcohio.org/government/treasurer/docs/2010_2011_Tax_Rates.pdf

  16. Gary August 14, 2011 / 2:36 pm
    @DL – …downtown and the Oregon District added 567 people over the last decade, not a huge increase, but an increase nonetheless.
    Yeah, coffee drinkers and dressmakers … :-)
  17. Corner owner June 24, 2014 / 9:00 pm
    I’m an owner with two part time employees who were forced into the 1% income tax and we were told that none of the big businesses aren’t paying in yet because it hasn’t tracked the top of these corporations. Just the little guys paying. Not fair not fair.

    Oh and we live in butler townshio and we voted against it.

    Oh and our business is not on miller lane.

    What to do what to do.

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