MUNCIE, Ind. (September 14, 2105) - Muncie City Council members approved Monday night 5-2, a proposed income tax increase.
The measure comes as the city has experienced $50 million in unexpected losses due to state mandated property tax caps.
Muncie Mayor Dennis Tyler said the losses are part of the general fund revenue that pays for public safety, parks programs, and recreation programs.
The income tax increase will go into affect in 2016.
For those who make an average of $50,000 per year, they would see about $240 per year out of their paychecks. That equals about $20 per month.
Mayor Tyler said the city would gain about 20 percent of the millions of dollars in losses, but it's still not enough. He said an income tax increase was the only option given to cities like Muncie by the state general assembly.
“Nobody’s done anything wrong. Nobody’s overspent. Nobody’s over budgeted. We haven’t done anything wrong. It’s just that the circuit breaker losses, when you tie them into the tax caps, they’re devastating cities," Tyler said.
Before the meeting, members of the public had the chance to voice their support or opposition for the plan.
Linda Michael's Muncie business has been in her family for over 57 years. She said the city council should come up with a plan that doesn't involve taking money from residents paychecks.
"Every year, we have less and less business and the reason we do, and we’re not the only small business in this community, and it’s because people are leaving here," Michael's said.
Muncie Police Chief Steve Stewart spoke in support for the tax increase, although the additional funds would not equal additional officers for the already understaffed department.
“As our resources have dropped, our calls for service have remained the same in the years. It’s becoming more than more difficult for us to manage those calls in an efficient manner," Chief Stewart said.