By Frank Lewis
Portsmouth City Manager Derek Allen has presented two income tax options for City Council to consider in an attempt to bring further revenue into the city’s coffers. One would make filing a city income tax return mandatory while another would cut in half the city income tax credit to residents who live in the city but are employed in another jurisdiction. As it stands now, people within that scenario receive full credit for the tax paid in other cities. Allen is giving the city the option to cut that credit by 50 percent.
One of those who said he would not support the reduction of the tax credit was Vice Mayor Kevin W. Johnson, who referenced Sections 87 and 89 of the City Charter, which deals with staffing levels in the Police and Fire departments, a section he says he will bring up for consideration to be placed on the ballot for voters to rescind. He said he does not believe the city has explored all options, citing the cost of those employees.
“This proposal is not an income tax increase,” Fourth Ward Councilman Jim Kalb said. “In my opinion it’s just a matter of everybody paying their fair share.”
Portsmouth Mayor Steve Sturgill asked City Manager Derek Allen if he thinks the reduction income tax is necessary.
“In my opinion every penny that I can obtain is necessary,” Allen said. “But that ultimately is not my decision. It’s ultimately Council’s decision. The one viewpoint that I have is when I meet with the representative from the State Auditor’s Office regarding our Fiscal Watch, when they ask what is every effort you have tried? then I’m able to list the things whether this gets passed or not. Is it going to make or break the city? No. Is every opportunity we have a building block to put things back together? Yes.”
“Is it fair for me to say that perhaps if you live in city of Portsmouth and you work in New Boston you may pay three percent as opposed to your neighbor next door who pays two percent?” Third Ward Councilman Kevin W. Johnson said.
“Yes,” Allen responded.
“Gentlemen, I just don’t know that taxes, taxes, taxes, is always the answer,” Kevin E. Johnson said. “And I’m not against taxes as Councilman (Kevin W.) Johnson said, but I’m not in favor of this.”
Second Ward Councilman Rich Saddler responded that he is in favor of the tax credit reduction.
“Like our (City) Manager says, we need to try to acquire every dime that we can,” Saddler said. “We’re hanging on a cliff right now. And we’re very close to falling off that cliff.”
By a 4-2 vote, Council decided to accept Alternative Number one, which would create the proposal as an ordinance for future consideration, only Kevin W. Johnson and Kevin E. Johnson voted against bringing it forward.
Frank Lewis can be reached at 740-353-3101, Ext. 252, or on Twitter @FrankLewispdt.