Tuesday, May 6, 2003

City not adding new tax


Independence insurance safe

By Cindy Schroeder
The Cincinnati Enquirer

INDEPENDENCE - Residents of Independence want to remain free of an insurance tax. City leaders accepted a petition Monday signed by about 500 people who say they don't want to see Independence join a growing number of cities that levy a tax on auto and home insurance premiums.

The only problem is, it's been a dead issue, Mayor Chris Moriconi said.

"It never had a majority of council behind it," Moriconi said Monday. "There was never enough support to really even move forward with it."

City Council gave initial approval Monday to a new $3.3 million general fund budget that does not include any tax increases beyond the usual upward adjustment of the "compensating rate" for property tax. The property tax rate can be adjusted every year to bring in as much as 4 percent in new revenue without a vote of residents, which council did. Council expects to vote on the new budget next month.

In Northern Kentucky, the Kenton County cities of Independence, Edgewood and Crestview Hills and the Boone County city of Union are the only municipalities that don't levy any kind of insurance tax, according to the Kentucky League of Cities.

Insurance tax is added on to the insurance bill. Residents don't have to write a separate "insurance tax" check.

JoAnn Cobble, who's lived in Independence all of her 55 years, said she circulated petitions against an insurance tax because to levy one would place an unfair burden on residents, especially senior citizens on fixed incomes.

"This way, if a council member has the nerve to say, 'I don't think there's anybody against this,' we'll say, 'Don't you have a record of the (hundreds) of residents who signed the petition?'" Cobble said. "Now they'll know for a fact that there's a lot of opposition."

Moriconi said Council Member Carol Franzen had suggested levying an insurance tax so the fast-growing city could add two or three police officers.

Independence has not hired any new police since 1999, except Drug Abuse Resistance Education (DARE) officers subsidized with grant money, Moriconi said.

He added the city is growing by about 300 homes a year and added 30 new streets in 2001 alone.

"I put together a budget of what would have happened if we had added two or three more cops," Moriconi said. "But it never had a majority of council support, so I withdrew it."

Moriconi said the insurance tax issue was never on Monday's agenda. He said the budget heard Monday night calls for adding one more police officer with existing revenues.

Cobble said she was concerned because city officials prepared two budgets last month - one with an insurance tax and one without it.

"It was definitely being considered," she said. "I felt we had to act now before it was too late."

City Administrator Mark Wendling said state law gives Kentucky cities the authority to levy a tax of between 5 and 12 percent on any kind of insurance premiums paid by its residents. However, he said no specific rate was ever proposed in Independence because discussions never got that far.

E-mail cschroeder@enquirer.com




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