ALEXANDRIA — A vote on whether to increase the county option income tax has been postponed.

The Alexandria City Council would have been forced to propose a resolution to increase the county option income tax, or COIT, during Monday’s meeting, but a change to the state budget has given Alexandria, and other Madison County officials, a few extra months to make the decision.

The state’s original deadline for passing a COIT increase was Aug. 1, but according to Sen. Tim Lanane, D-Anderson, that deadline has been extended to Nov. 1.

Alexandria council members took the chance to get out of the vote during Monday’s meeting, but expect to consider the measure later this month, according to city attorney Mark Regnier.

Last summer, the city of Anderson proposed a resolution to reconfigure the COIT, including an increase to the local income tax.

Since the county and the city of Elwood voted against the tax, Anderson was unable to get the 51 percent majority it needed.

Now, as property tax revenue continues to wane and cities try to avoid layoffs, the question of the COIT is once again making its rounds from Alexandria to Anderson to Elwood.

The COIT resolution, as proposed by Anderson in 2008, would increase the existing COIT from 1.25 to 1.5 percent.

The COIT resolution called for the elimination of the county’s economic development income tax of .25 percent and adds a .25 homestead credit tax in its place. An additional .25 percent tax would have then been added to pay for public safety.

For a person earning $40,000 per year, this would equate to $100 extra in income taxes per year.

There has not been a new resolution drafted that would alter the proposed resolution considered by councils last year.

Cities like Alexandria need the money, according to City Councilman John Dockrey.

Alexandria must cut more than $600,000 from its budget in 2009 and 2010.

Dockrey said the loss of revenue is caused by property tax caps. “It’s not really extra money,” he said.

Since taxpayers are no longer paying high property taxes, county officials are hoping to tax only working residents to make up for the difference.

Last year, Dockrey was the only member of the Alexandria council to vote in favor of the tax.

Jack Woods said the money is meant to keep emergency services available in Alexandria. If you call 911, you want police and fire to be there, he said. “We’re kind of forced to implement local taxes to keep these services alive.”

Councilman Eric Schmidt asked during the meeting if the COIT helps schools.

It does not.

COIT funding is meant to help towns and cities pay for public safety, according to Alexandria Clerk-Treasurer Jan Lynch.

“I did a survey asking people and that’s the first thing they asked me,” Schmidt said.

Regnier believes Alexandria won’t be the last town to discuss the COIT before the Nov. 1 deadline. “It seems to have more momentum this year than it did last year.”



Contact Brandi Watters: 640-4847, brandi.watters@heraldbulletin.com



COIT formula

In order for the county option income tax to be increased, 51 percent of the cities and towns in a county must pass resolutions to increase the tax. A formula has been established determining the percentage of the vote given to each town. The percentage is based on population. Below, the breakdown of who gets what percentage of the vote is outlined.

Madison County 31.35 %

Alexandria 4.7 %

Anderson 44.8 %

Chesterfield 2.23 %

Country Club Heights .07 %

Edgewood 1.49 %

Elwood 7.31 %

Frankton 1.43 %

Ingalls .88 %

Lapel 1.39 %

Markleville .29 %

Orestes .25 %

Pendleton 2.91 %

Summitville .82 %

Woodlawn Heights .06 %



New deadlines

If the COIT is approved by a certain date, it only takes a matter of weeks for the tax increase to go into effect. Here’s the schedule for this season’s COIT.

If the increase is passed before Oct. 1, the tax takes effect on Oct. 1.

If the increase is passed after Sept. 30 but before Oct. 16, the tax takes effect on Nov. 1.

If the increase is passed after Oct. 15 but before Nov. 1, the tax takes effect Dec. 1.

Source: Sen. Tim Lanane