Hearing on 0.2% Monroe County jail income tax set for Sept. 16, paired with brief drop in related rate

Monroe County councilors have set the stage for formal public input on a proposed increase of the jail LIT (local income tax), by authorizing an advertised rate of 0.2 percent for a public hearing on Sept. 16.

That is the maximum rate for the jail LIT that can be imposed on Monroe County residents, up from the current rate of 0.01 percent.

The point of raising the jail LIT rate is to pay for a new jail, and possibly a co-located justice center complex, with a total construction budget of as much as $200 million.

The action taken by the seven-member county council on Tuesday night was not unanimous—with the sole dissent coming from Kate Wiltz.

Wiltz and Jennifer Crossley both said there were too many unanswered questions, including a determination of the size and location of a jail. Councilor Mary Hawk was keen to keep the overall income tax rate as low as possible.

But Crossley and Hawk were both willing to go ahead and set the public hearing at the 0.2-percent jail LIT rate, in order to get formal public input on the question as soon as possible.

County councilors who voted in favor of the advertised rate of 0.2 percent for the jail LIT are not required to support that rate, when the vote is taken sometime after the Sept. 16 hearing.

In the same action on Tuesday, the council also voted to advertise a new, lower rate of 0.03 percent for the “special purpose” category of local income tax, which currently funds the operation and maintenance of a juvenile services center and other facilities to provide juvenile services.

It was Hawk’s push during Tuesday’s meeting that led councilor Geoff McKim, who was in full support of the 0.2-percent jail LIT rate, to calculate a lower rate for the special purpose LIT, based on the juvenile services proposed 2025 budget, which has just recently been submitted.

The combined effect of the increase in the jail LIT and a decrease in the special purpose LIT would be an increase of 0.135 points in the local income tax paid by Monroe County residents.

County councilors are not looking to maintain the special purpose tax at 0.03 for the longer term, because that would not be enough to fund juvenile services over the long haul.

But it would allow for the current high fund balance for the special purpose LIT to be drawn down. And the lower special purpose rate would provide a relatively lower overall rate for taxpayers, at least for a while, compared to an increase in the jail LIT rate, with no adjustment to the special purpose LIT.

It’s the same logic the council council used last year, when it established a jail LIT rate for the first time, at 0.01 percent, while reducing the special purpose LIT rate to 0.085 percent.  The net effect of that move was no change to the overall income tax paid by Monroe County residents.

The rate for the special purpose LIT won’t increase in the future, unless a future council acts to increase it.

About the situation faced by the county council, McKim expressed some concern, because he did not seek reelection this year, and will not be returning to the council in 2025. That means he won’t be serving on the county’s fiscal body when it comes time to raise the special purpose LIT rate. “I’m just feeling twitchy, because I’m not going to have the opportunity to vote on bringing it back up next time,” McKim said.

During Tuesday’s meeting, some wrangling unfolded among councilors over the scheduling of the hearing and the possibility of lowering the rate after the hearing. These were issues that had been confronted at a mid-August meeting of the council.

What seemed to be persuasive to councilors was the idea offered by councilor Cheryl Munson that the council should hear from the public in a formal way as soon as possible. That idea was picked up by councilor Peter Iversen, who said, “I really appreciate councilor Munson’s wisdom on this topic—being able to advertise a rate this evening allows us to move forward to hear directly from the public, which is where we should be anyway.”

In order for additional revenue to be collected under an increased jail LIT rate starting Jan. 1, the council has to act by Nov. 1.

A 0.2 rate applied to a taxable income of $20,000 per year works out to $40 a year.

The current local income tax rate for Monroe County residents, for all categories, totals 2.035
percent.

The reason county councilors are looking to find money to build a new jail is that Monroe County’s jail currently operates under a 2009 settlement agreement with the ACLU, which filed a lawsuit over crowded conditions at the jail. The settlement agreement has been extended several times.