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Commission Split over Outsourcing Tax Collection
By Jordan Cohen
NILES
The commission overseeing the city’s efforts to get out from under fiscal emergency is split over outsourcing income-tax collections and eliminating jobs in the treasurer’s office.
The differences emerged in a joint meeting Wednesday between the Financial Planning and Supervisory Commission and city council during a discussion of the recovery plan developed by Mayor Ralph Infante and approved by council. One point lists exploration of the use of the Regional Income Tax Agency for income tax collections. Outsourcing would mean probable elimination of the income tax office and its four employees.
Infante, a commission member, said he is looking into other companies, but argued to keep tax collection in-house. “Don’t go to RITA,” he said.
The mayor got support from commission member John Davis, who said that the estimated $10,000 to $14,000 annual savings from using RITA are not worth the problems the dismissals might cause. Davis said outsourcing could ensure defeat of a 0.25 percent increase in the income tax in November, which is critical to the city’s recovery. The tax increase eventually would generate $600,000 annually.
“We might lose the income tax because of the people who lost their jobs [so] what’s the point,” Davis argued.
Niles has been in fiscal emergency since a state audit’s declaration last October.
Two commission members are leaning toward the use of RITA, however. Sharon Hanrahan, commission chairwoman, told The Vindicator earlier this month, “I’d recommend it based on the numbers and I’m pretty sure so would the state auditors.” Mary Ann Coates, a certified public accountant, said her construction company has worked with RITA to comply with tax collections without any problems.
Davis had questioned the quality of RITA’s customer service noting that the city of Lakewood near Cleveland had dropped the agency for that reason, but Coates defended RITA. “I’ve been very satisfied with their customer service,” she said after the meeting.