Trustees brace for JEDD battle

By Ed Runyan

JEDDs are successful elsewhere but not in the way Youngstown is proposing, Austintown officials say.

AUSTINTOWN — Township officials are expecting the city of Youngstown to force Austintown into a legal battle as early as this summer in an attempt to collect income tax money from those who work here.

The most likely scenario is that the city will threaten a business on the Austintown side of Meridian Road with losing its Youngstown water if it refuses to annex into the city, said Trustee David Ditzler.

The move would become a test case in court because the township would file legal action to stop the annexation, Ditzler added. In the end, the case would answer the question of how much power the city has over the township because of its ownership of Austintown’s water lines, said Trustee Bo Pritchard.

Those were some conclusions drawn Tuesday night when more than 100 people filled the auditorium at Austintown Middle School to hear a township presentation on Youngstown’s joint economic development district proposal.

The proposal calls for Austintown and the northern part of Boardman to enter into an agreement with the city that involves charging a 2 percent income tax to everyone who works for a business that receives the city’s water.

Workers also would pay an additional .25 percent sales tax that would be paid to the township if the township so desired.

In exchange, the city would reduce its income tax from 2.75 percent to 2.25 percent, reduce its surcharge on Austintown and Boardman water customers from 40 percent to 20 percent and provide additional economic development for the two townships.

But as they have since just after the proposal was given to the townships several months ago, Austintown’s trustees and fiscal officer focused on the cost of the plan for workers.

In all, the new income tax would pay the city $14 million to $16 million per year, Pritchard said.

“It is going to be an obvious detriment to this Valley and would go directly into the city of Youngstown,” Pritchard said.

Most troubling to Austintown officials and many of the citizens who spoke is that the city’s proposal seems to take a good economic development tool and turn it into nothing more than a money grab.

JEDDs have been used successfully in areas such as Akron, Columbus, Dayton, Middletown and Newark, but they always involve charging a city’s income tax on workers whose jobs were created as a result of new development, not on workers at existing companies, Ditzler said.

Michael Kurish, the township’s fiscal officer, projected letters on a screen from various Austintown and Boardman business leaders who said they would move their businesses out of the townships if their workers had to start paying a JEDD income tax.

Kurish also said the city’s proposed reduction in its water surcharge from 40 percent to 20 percent would save a typical two-person household only about $30 per year, while the plan would cost a worker making $35,000 per year almost $800 a year.

The township will remain poised to act on a number of fronts depending on what the city does, Trustee Lisa Oles said.

Incorporating the township into a city would stop the city from annexing any Austintown property, but it wouldn’t stop the city from increasing water rates, Ditzler added.

Other Austintown options include becoming a home-rule township and forming the township’s own water district; securing a new water supplier, such as Aqua Ohio; or changing the Ohio laws that govern the Mahoning Valley Sanitary District, which supplies water to Youngstown, Kurish said.

Youngstown Mayor Jay Williams did not return a phone call Tuesday night seeking comment.