NewzCincinnati Public Schools is asking voters to approve a new earned income tax levy this November after the board voted 5-2 to place the measure on the ballot.The 0.75% earned income tax would apply to residents who live within the district, and district leaders say a failed levy would mean deeper cuts for the third straight year.Board President Brandon Craig said the district has reached a point where budget cuts are no longer sustainable without new funding."We are now at a point where that's not really an option, and we saw that this year with some of the positions that were directly facing students. Next year's cuts would be worse if we did not pass a levy," Craig said.The board considered three options before settling on the earned income tax. CPS Treasurer Michael Gustin explained at the meeting how the tax would be applied."So if you live in Cincinnati, work in Cincinnati, you're going to pay it.
If you live in Cincinnati, work in Blue Ash, you're still going to pay the same amount. If you live in Blue Ash and work in Cincinnati, you will not pay it all," Gustin said.The earned income tax would not affect retirees, those receiving Social Security or those living on investment income. It targets working income only, meaning residents who both live and work in Cincinnati would be the primary group affected.In June, the board cut 100 positions to address a $58.6 million budget gap.
Craig said the cuts over the past two years have been focused on minimizing the impact on students, but that is no longer possible."We don't have operations stuff. We don't have pens and paper and paper clips to take out of our budget. What we have are staff, because the majority of our budget is staff," Craig said.The district is also in the middle of developing a strategic plan, which leaders hope to finalize before the new school year begins.
Craig said the levy, if passed, would help protect programs including Montessori schools and career and technical education opportunities.WATCH: Cincinnati parents call for transparency as CPS approves new levy Cincinnati parents call for transparency as CPS approves new levyThe last levyThe current ask comes 10 years after CPS last went to voters. According to WVXU, CPS had not had a new levy since 2008, and district officials had been told they could be facing large deficits in the near future when the previous levy was put together.… For the first time in its history, Cincinnati Public Schools is asking voters to consider an earned income tax rather than a traditional property tax levy, marking a significant shift in how the district plans to fund its operations.The CPS Board of Education voted Monday to place a 0.75% earned income tax levy on the November ballot, saying the proposal would provide a more sustainable revenue source as the district grapples with rising costs and declining state support.If approved by voters, the levy is expected to generate about $74 million annually, with revenue projected to grow by up to $2 million annually as residents' wages increase, according to district treasurer Mike Gustin.The measure comes just weeks after the district approved more than 100 personnel cuts to help address a projected $58.6 million budget deficit.How an earned income tax differs from a property taxUnlike the property tax levies voters are accustomed to seeing on school ballots, an earned income tax is based on residents' wages and salaries rather than the value of their homes.WATCH: How would Cincinnati Public Schools' proposed earned income tax levy work?
How would Cincinnati Public Schools' proposed earned income tax levy work?The proposed levy would apply only to people who live within the Cincinnati Public Schools district, regardless of where they work. Someone who earns $100,000 annually would pay about $750 a year under the proposed rate.The tax would not apply to retirement income, Social Security benefits or investment income.Darrin Wilson, an associate professor of public administration at Northern Kentucky University, said that distinction is one of the proposal's defining characteristics."It really is shifting the tax burden away from retirees and property owners and back toward folks who are working but live in the city of Cincinnati," Wilson said.Wilson said many people are already familiar with Cincinnati's municipal income tax, but school income taxes work differently.Municipal income taxes are generally based on where a person works. School district income taxes, however, are based on where a person lives.That means a Cincinnati resident who works in Mason or Northern Kentucky would still pay the school income tax if the levy passes.
Conversely, someone who works in Cincinnati but lives outside the CPS district would not.Ohio law caps school district earned inco…
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