Lucas County Commissioner Ben Konop, a potential Toledo mayoral candidate, is calling on cities and villages in Lucas County to give local businesses a tax break if they promise not to lay off workers.
In a letter dated Friday, Mr. Konop said a "monetary award" might help stressed employers keep people on the job.
"In this time of climbing unemployment and economic peril, when the jobless rates in Lucas County and specifically in Toledo are soaring four and five percentage points over the statewide average, cities and villages have some tools available to help soften the blow this devastating recession is having on private-sector workers," Mr. Konop said.
As a model for what they might do, Mr. Konop suggested to mayors and councils a payroll tax rebate of 100 percent for businesses with fewer than 10 employees, 50 percent for up to 50 employees, and one-third of their total tax bills for larger companies.
Businesses would have to verify they are preparing to lay off employees and would do so if not approved for the award. They would have to maintain job levels for a year to keep the award.
Toledo City Councilman Frank Szollosi called the plan creative, but said city finances are so tight that a reduction in tax revenues could mean the layoff of city employees."I'm interested in supporting this but I'd like to find a way to make the city whole," Mr. Szollosi said. He said the county could reimburse the city from its Workforce Development funds account or from its $22 million rainy day fund as a way to help cities keep businesses open.
Waterville Mayor Derek Merrin said it was contradictory of Mr. Konop to ask villages and cities to give up tax revenues when Mr. Konop voted in January, 2007, to raise taxes on the lodging industry to pay for a new county arena.
"Hotels and motels are businesses, and it doesn't make any sense to raise taxes and then call for other municipalities to give tax incentives," he said. The increase from 8 percent to 10 percent in the hotel-motel tax was enacted to raise half of the cost of the arena.
Mr. Konop said the arena will create jobs in Lucas County, and he said the tax is paid by visitors to Lucas County, not residents. He called Mr. Merrin's argument weak.
He said he and Mr. Szollosi discussed collaboration between the county and the municipalities.
"The county is getting millions of federal stimulus dollars and so we're looking at ways we can partner with the city and other cities in Lucas County to fill gaps in their budget," Mr. Konop said.
Commission President Pete Gerken confirmed the county has a rainy day fund but said it is being used to maintain county services in the face of declining sales tax revenues. He said federal Workforce Development funds are not available to reimburse cities or villages that offer tax incentives.
"I'm for anything that retains jobs. I'll rely on the wisdom of the elected [municipal] officials," he said of Mr. Konop's proposal.
A Democrat, Mr. Konop said he is seriously considering running for mayor of Toledo and was not ready to announce a decision.
Contact Tom Troy at:
tomtroy@theblade.com
or 419-724-6058.
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