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Portrait of Dave Delande

How Local Taxes Are Reinvested in Community

Posted February 1, 2021 in Your Community by Mary Smith

Guest Columnist Dave Delande.

Each year about this time, the city of Hilliard’s finance department begins to get a lot of questions about income taxes and property taxes and how those funds are invested back into the community.

These are great questions.

First, remember that municipal governments and school districts are separate governmental agencies with different governing bodies of elected officials. This is important when talking about the investment of local tax revenues back into our community.

Income taxes

The city of Hilliard’s primary funding source is a 2% income tax, accounting for nearly 70% of the city’s general-fund revenue.  

Hilliard residents must pay the city a 2% municipal income tax unless they are taxed at least 2% by the taxing district where they work.

This is an important distinction. More than three-fourths of Hilliard’s local income taxes are paid by people who work within Hilliard’s corporate boundaries but do not live here.  

That means our community enjoys great services and quality-of-life amenities – such as snow removal, swimming pools, police, parks, bike trails and the community center – that largely are paid for by people who are not residents.https://a527824806e02166e7cc79a5b8d22cc3.safeframe.googlesyndication.com/safeframe/1-0-37/html/container.html

There are smaller funding sources for the city’s general fund, including fees for rendered services, fines, permits, grants and earnings on investment. Very little of our funding (less than 6% of the general fund) comes from property taxes. 

Property taxes

Although most Ohio municipalities are funded with income taxes, the primary source of revenue for most Ohio public school districts is property taxes.

Few school districts receive significant funds from local income taxes. In 2020, Hilliard City Schools reported that 53% of its operating revenue comes from property taxes. Another 39% comes from state and federal funds. 

So, in short, income taxes pay for great city services and amenities, and if you don’t work in Hilliard you probably don’t pay Hilliard income taxes.

Meanwhile, property taxes and state and federal funds pay for most of the great education local students receive from Hilliard City Schools.

Filing your taxes

Hilliard has mandatory tax filing. That means that everyone age 18 and older who is living in Hilliard must file Hilliard income-tax forms with the Regional Income Tax Agency, generally by April 15. (Thus far, we have not heard that the filing deadline will be delayed, as it was in 2020.)

You must file regardless of whether you owe any Hilliard income taxes. The exception is for retirees, who are not required to file.

Even if you don’t work and make no income, you still must file the forms.

Filling out your taxes can be complex. As you complete your RITA forms, know that the Hilliard finance department is available from 8 a.m. to 5 p.m. weekdays to help answer questions. You may contact us at (614) 876-7361, extension 778.

Dave Delande is finance director for Hilliard.