Salem officials consider asking for tax increase

By D.a. Wilkinson

Voters — not council — would decide a tax increase.

SALEM — Are hard times a good time to move ahead with capital improvement and economic development projects?

Some city officials think so.

Council and administration members are contemplating asking voters if they would support an increase in the city’s 1 percent income tax to help the city grow.

Councilman Justin Palmer, the head of council’s finance committee, said that moving ahead is a better choice than trying to hang on until the economy improves.

But any decision to increase taxes, he said, “will be up to the people.”

Council has modified the income tax revenue division from 75 percent for operating expenses and 25 percent for capital improvements to 85 percent for operations and 15 percent for capital improvements. That division is designed to help the city have enough revenue to get through early 2009.

Mayor Jerry Wolford is interested in expanding the city’s boundaries to aid industrial development to improve the city’s economy.

Palmer said he could not comment since the purchase of property is confidential, by law.

Salem’s one percent income tax brought in $3.9 million so far this year, said city Treasurer James Armeni.

The tax generated $3.98 million in 2007, which, he said, indicates “collections are flat.”

Officials first must decide how they want to approach voters.

Palmer said that Councilman Earl A. Schory II heads council’s committee of the whole, which could decide to seek a levy to fund part of the city government, such as the fire or police departments.

That would free money for use in other departments.

Schory could not be reached to comment.

But Palmer and Steve Andres, the city’s service director, believe that a levy would complicate the funding picture.

Andres has a list of capital improvements for 2009 through 2012. He said it would likely take another year to complete all the projects.

The first year alone calls for buying two snowplow trucks at a total cost of $185,000. Two of the current trucks are 19 years old.

The police and fire departments also have equipment needs.

Palmer envisions public meetings to get comments on whether residents want to pay more.

If so, the meetings would have to take place in January and early February in order to place the issue on the 2009 May primary ballot.

wilkinson@vindy.com