Revenue rules: Mayor delivers State of the City address to chamber

If an economic downturn strikes crippling income tax revenue or if the city’s main source of funding fails to match needed expenses, Mayor Rodney Metz says city leaders have already started to discuss ideas to deal with the shortfall.

Metz, who reviewed progress made last year and plans for this year and next year by each city department during his 15-minute speech, addressed the “roller coaster” of city income tax revenue the past year during his State of the City address before 70 people gathered Thursday at the Wapakoneta Area Chamber of Commerce luncheon.

“On the positive side, income tax revenue has rebounded because of the increased employment at the retail, commercial and industrial establishments in the city — they all seem to have picked up a little bit,” Metz told the Wapakoneta Daily News after the event held at Marley’s Downtown. “The troughs in the income tax revenue roller coaster ride are a concern and they come more from when third party entities submit the taxes by the city deadline, but it doesn’t necessarily get to us to be posted in the correct month.”

Income tax revenue for 2011 of $2.109 million failed to keep pace with 2010 collections of $2.119 million — a decrease of approximately $10,000.

The roller coaster of income tax collection, the mayor referred to, is evident through the first four months of this year compared to the first four months of last year.

While the totals are comparable with $903,260 collected through April this year compared to $902,688.06 collected through April 2011, March 2012 income tax revenue paled to 2011 totals when $127,714 was added to the city’s net receipts this year compared to $188,974 in 2011.

City leaders anticipated a big bounce in April but it did not materialize. Net receipts for the month totaled $368,799 in 2012 compared to $382,844 in 2011.

With income tax receipts inconsistent this year, the mayor said he, Safety-Service Director Bill Rains and Wapakoneta City Council members intend to keep a close eye on the total and continue to evaluate the revenue stream for trends.

“Finance Committee members have been looking at the income tax revenue and they have talked about a couple different things to do, a couple different choices, to raise the necessary revenue to operate the city at the proper level,” Metz said after the 90-minute luncheon. “Obviously one option is an additional levy for police and fire services and for permanent improvements. Another option is a rollback of the income tax credit for people who live in Wapakoneta but work outside the city.”

He said two other options are being considered, but he did not elaborate.

Metz explained city leaders need a consistent level of funding for safety services and it is hard to plan for the long term if they cannot count on funding that may disappear in the future.

Overall, the mayor said the city is financially stable.

“We are in descent shape, but obviously that could change in a few months just as (Auglaize County) Commissioner Doug Spencer said about the economy being pretty volatile,” Metz said. “The economy and revenue is stabilizing and it is getting better — we just have to continue to watch it on a daily basis and on a monthly basis.”