Finance director: income-tax collections roughly flat through April; council to revisit after June

Finance Director Eric Dean reported to the Strongsville City Council finance committee on May 4 that year-to-date income-tax receipts through April totaled $21,506,692 and were essentially flat compared with last year after gains in withholding and individual payments offset a decline in net-profit collections.

“Year to date, we’ve collected 21,506,692 for the year,” Dean said as he reviewed monthly RETA payments and charts tracking daily processing. He said withholding remains the largest revenue source (about $14 million of the $21 million reported) and that withholding receipts were up roughly $513,000 (about 3.5 percent) year to date, while individual resident payments rose about 9.5 percent. By contrast, Dean said the net-profit tax was down roughly $510,000, or about 15 percent, and described net-profit receipts as “the most volatile” category because they depend on filing and estimate timing.

Dean told council members that RETA (the regional income-tax processor) pays the city twice monthly and that timing differences mean recent daily system reads can provide a near-term view of trends. He said October often produces a large payment tied to extensions, underlining why the city will continue to monitor collections through the remainder of the year.

On other revenue lines, Dean reported property-tax collections at about 54 percent of estimated revenue and said the city has roughly $1.3 million in TIF receipts; he noted those TIF dollars currently service two debt items (traffic-signal bonds at about $340,000 per year and road-widening bonds at about $580,000 per year). Dean and Mayor Tom Perciak discussed pending state legislation that could allow broader use of TIF funds for items such as fire-station debt; Perciak urged council members to contact state lawmakers about the measure, which he said was still in committee.

Turning to expenses, Dean said the salary-only payroll figure is about $12 million, up roughly $518,000 from last year, and that healthcare spending is trending toward the $8 million budgeted for the year. He noted the city’s reinsurance policy covers large employee claims (he cited the reinsurance threshold at about $100,000) and said a small number of high-cost claims can materially affect the monthly trend. Dean also described capital-project items that may require budget adjustments, including a water-line/hydrant project whose bids came in higher than estimated and will likely be brought back to council for an amendment.

Dean recommended another quarterly update after June 30 and said the administration will continue tracking receipts and claims. “We will probably do another quarterly update after June 30 as we continue to trend throughout the year,” Council President Gordon Short told members after the presentation.