Election 2019 Cincinnati: Issue 22 — Eliminating the City’s Earnings Tax for Bus Funding

The city charter amendment could pave the way for the passage of a county-wide levy to fund bus service.

Oct 15, 2019 at 4:09 pm
click to enlarge Metro buses at Government Square in downtown Cincinnati - Nick Swartsell
Nick Swartsell
Metro buses at Government Square in downtown Cincinnati

After years of uncertainty about the financial state of Metro, Cincinnati City Council in August took a first step toward a new funding model for the Southwest Ohio Regional Transit Authority’s bus service.

There are still plenty of dominoes left to fall, but voter approval of removal of the earnings tax could clear the way for a county-wide sales tax levy SORTA’s board has voted to put on next year’s ballot — something that most other urban counties do. It would be the first major change to Metro’s funding system since the 1970s. 

Council member P.G. Sittenfeld introduced the proposal that, if approved by voters, would eliminate the .3 percent of the city’s earnings tax that goes toward Metro’s operations — but only in the event that Hamilton County voters approved a sales tax boost of .7 percent or above for funding Metro. Sittenfeld said the vote was the first step toward “multi-generational change” by vastly improving the region’s bus system.

Metro currently gets by on $100 million a year, with roughly half of that coming from the .3 percent tax assessed on people who work in the city. Overall, the city’s income tax is 2.1 percent, meaning that eliminating Metro’s portion would lower the city’s earnings tax to 1.8 percent. That’s easily the lowest of any major city in Ohio. 

The bus system badly needs more funding. It faces a $5.8 million budget deficit this year and needs many millions of dollars in investment to become better-functioning and connect more Greater Cincinnati residents to jobs. 

A plan called Reinventing Metro could substantively improve bus service if voters approve a .7 percent or higher Hamilton County sales tax increase. In the meantime, the bus system is in a tough spot.