BY MARIE McCAIN
The Cincinnati Enquirer
FOREST PARK -- A councilman has come up with a plan he says will evenly distribute the burden of this area's taxes.
Forest Park Councilman Michael Bonney said a full local tax credit to those residents who work outside Forest Park is possible and would not harm city services. Specific details of his proposal are not final.
The lost revenue could be recouped, he said, through revenues from continued economic growth, minor adjustments to capital improvement plans, and renewed enforcement of an existing estimated tax penalty provision that has been overlooked for a number of years.
Called the "Full Credit Act of 1998," the proposal should be ready for presentation to council's Ways and Means Committee in August.
Opponents, though, say it toys with more than $800,000 of the city's $5 million tax base and could alienate residents who both work and live in Forest Park.
But Mr. Bonney thinks his plan would work without significant problems for those who work and live in Forest Park.
Under existing tax laws, residents are required to pay 1 percent of their income for city taxes. Those who work outside Forest Park are given a 0.5 percent tax credit which means they have to pay taxes to both the municipality they work in and the one in which they live. This affects 60 percent of Forest Park's population.
Under Mr. Bonney's plan, that 60 percent would no longer be required to pay the 0.5 percent. The plan would be phased in over a two-year period starting Jan. 1, 1999. At that time the credit would become 0.75 percent and then become full credit in 2000.
He said Forest Park has been successfully marketed during the past three years and in 1997 generated more than $30 million of new business investment which created or retained 450 jobs.
Income tax revenues between 1994 and 1997 have increased by 20 percent, while total revenue increased by 11 percent, he added.
"This seems to be the perfect opportunity for the elected officials of Forest Park to make all residents . . . whole as it relates to credit for taxes paid to other taxing districts," Mr. Bonney said.
This plan worries Mayor Wayne Coates, who said it could endanger plans for a community center.
Within the last two months, the Parks and Recreation Committee formed a task force to study a city community center, something residents have wanted for some time, Mr. Coates said.
He said in order to build and operate a community center under Mr. Bonney's plan, city officials would have to approve a 0.5 percent local tax increase and place a greater burden on those who work in Forest Park.
The mayor also said that reinstating enforcement of the estimated tax penalty provision would also "criminalize" some residents and cripple the city's attempts to soften its tax laws.
The penalty provision is geared toresidents who work in a non-taxing district. It punishes those who fail to file their taxes quarterly as required by law. A 1997 study showed that the city loses about $150,000 a year by not enforcing this penalty.
Stopping short of calling these issues scare tactics, Mr. Bonney said the community center is in the planning stage and is not in danger.
"My intent with this legislation is to resolve a long-standing, divisive and controversial issue to the benefit of the city," Mr. Bonney said.
"I expect controversy, it's a controversial issue and I expect opposition," he said."But there will be a plan to pay for the credit without jeopardizing anyone's jobs or any programs."
"Every member of council has . . . stated their commitment to improving the quality of life of the residents. This is their opportunity to do just that, and pass fair and equal legislation."
