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Taxing

City Council’s Holly Frische may never win the argument that Findlay’s practice of allowing some, but not all, businesses to skip estimated taxes is unfair and needs to be shelved.
But she should continue to champion the cause, if only to make the practice more transparent.
If nothing else, there needs to be a better explanation of how the public benefits from a tax rule approved in 2009 and in use since 2012.
The fact that it’s apparently been operated without a written policy until now and is under the discretion of one person should be causes for concern.
Every member of City Council, not just Frische, should be asking themselves whether the practice should continue or end.
No one, with the exception of City Tax Administrator Andrew Thomas, knows the nuts and bolts of the practice, unique to Findlay, of allowing certain businesses (there were 54 at last count) to pay their taxes in lump sum, instead of in estimated quarterly payments like other businesses are required. Two individuals are also allowed to do the same.
Mayor Lydia Mihalik, an advocate of the practice, has said Findlay’s economy is unique because it is a small city with the headquarters of two Fortune 500 companies. Allowing one-time payments helps the city avoid making refunds if a business overpays, and also allows for better budgeting, the mayor says.
But Frische believes taxpayers deserve to be treated equally. Allowing some to avoid making estimated tax payments, while others are still required, is a bad government practice, she says.
While her position is one shared by a minority on council, Councilmen Jeff Wobser and Dennis Hellmann have expressed concerns about the practice in recent years.
Mihalik, who oversees the five-member City Income Tax Board, said this week it’s up to council to decide what to do, if anything, with the practice.
Clearly, the issue is not going away quietly.
Frische raised it again at Tuesday’s council meeting and again Wednesday at the end of the City Income Tax Board meeting. Both meetings got heated, but some progress appears to have been made.
At the tax board meeting, there were discussions about Thomas meeting with Auditor Jim Staschiak to go over information contained on the monthly reports Thomas provides to council about the tax program. Staschiak has questioned whether the figures accurately reflect the participation of all.
Mihalik, meanwhile, indicated a draft policy and procedure is being reviewed by the city’s auditing firm, and will be released to the tax board once approved. While the creation of the document comes late, it should provide insight in how the tax practice operates and guidelines used for participation.
Most tax information, including the names of businesses and individuals, is confidential under law, but the rules and guidelines that participants must follow should be made public upon approval by the tax board. That alone will improve transparency, but more may be needed to gain the public’s confidence.
The matter shouldn’t be just Frische’s cross to bear. Recent letters to the editor and comments on social media suggest others share her concerns.
At Tuesday’s council meeting, one councilman tried, unsuccessfully, to silence Frische when she raised the topic. Another said Frische’s arguments were “falling on deaf ears.”
Mihalik, at the tax board meeting the next day, said it was “time to move on,” that Findlay has more important issues to take care of.
That’s true, but the tax practice warrants closer examination. The administration, the tax board and council must continue to review it and decide if the benefits outweigh the distrust it creates.
If not, it should end.



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