Income Tax Hike Proposed to Ease City Deficit

By Rachel Martin

March 12, 2013 Updated Mar 12, 2013 at 11:26 PM EDT

FORT WAYNE, Ind. (www.incnow.tv) – Could income taxes soon be going up? The City of Fort Wayne is losing money, and the mayor has proposed some ideas on how to compensate for the loss.

Fort Wayne City Controller Pat Rollers says the City of Fort Wayne has lost $53 million since the property tax cap was put in place in 2009. Already in 2013, the city has lost more than 414-million and Roller says that's only going to grow.

Mayor Tom Henry created a Fiscal Policy Group, made of up city staff and leaders, that came up with ideas on how rake in more revenue. The proposals include reducing city operating costs by $5 million, changing city employee benefits—like incorporating spousal coordination in benefits, changing the sick pay policy, and reducing compensation/overtime for police and firefighters—and increasing income taxes from 1 percent to 1.5 percent. Roller says this way there will be no cutting of city services or employees.

“We have come up with a program we think will be able continue the good work the city has done to deliver these services and I think it's a program that everybody can win,” she said.

Roller says the proposed program could save the city $13 million a year.

Details of the proposed income tax increase will be discussed at next week’s City Council meeting. A public hearing will be held later in the spring, and any possible changes to legislation won’t happen until the summer.

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