Group seeks to raise the tax

“I’m willing to be a tourist in my own town and pay a few extra bucks if it would help this city out”
Andy Ouriel
May 15, 2014
It’s not often people campaign to raise taxes.

But a small contingent frustrated by Sandusky officials cutting programs and services assembled to restock the city’s coffers through a proposed tax increase.

Several residents recently formed the group Rebuild Sandusky, which is essentially a grassroots effort to replenish city programs and services.

The group’s pitch revolves around creating funds by increasing Sandusky’s 3 percent admissions tax rate.

Hypothetically, if a majority of city voters approved the issue in November, extra funds would go toward paving roads, filling potholes quicker, removing dead trees and keeping the three fire stations open at all times.    

An admissions tax increase could also restock severely depleted staffing levels at the fire and police departments.

Earlier this year, city commissioners cut $1.1 million of services to balance their $16.3 million everyday operating budget for 2014. To do this, however, commissioners needed to slash several services, including periodically closing down fire station No. 7 on Venice Road.

Some residents decided they needed to bring back, preserve and even strengthen vital quality-of-life services.

“I know no one likes to pay more taxes, but at least I can try to pick and choose which ones I pay” said group member and Wilbert Street resident Vicki Bird. “I understand people won’t support this, but I want to make it possible to place an initiative on the ballot”

Bird estimates the group will likely need about $6,000 for legal fees so a lawyer can help place the issue on November’s ballot. By early August, group members would likely need to finalize and submit all paperwork, including valid signatures on a petition, to the Erie County Board of Elections.

The effort revs up Sunday with a spaghetti dinner benefit, with all funds going toward the cause.

“I’m willing to be a tourist in my own town and pay a few extra bucks if it would help this city out,” Bird said.

Bird said she wasn’t sure how much more the admissions tax rate should or could be. Along with income and lodging taxes, admissions taxes represent a major funding source for Sandusky’s government operation.

The admissions tax, a 3 percent fee tacked onto ticket sales at Sanduskybased entertainment venues, largely depends upon Cedar Point — the undisputed giant in the region’s entertainment industry.

From 1998 to 2012, only once did a yearly admissions tax top $2.65 million.

In 2013, when Cedar Point debuted the roller coaster GateKeeper, city officials collected $2.81 million in admissions taxes — the most ever in Sandusky’s history.

Bird said she did support the admissions tax doubling to 6 percent. If the admissions tax totaled 6 percent a year ago, city officials would have generated about $5.62 million — more than enough to handle their shortfall from earlier this year.

But others aren’t so receptive to the idea.

“I applaud their effort, and I’m willing to listen to what the public has to say about this, but I personally do not support raising the admissions tax,” commissioner Wes Poole said. “The city of Sandusky needs to spend the money we have more wisely. The approach of just throwing money at our problems is not one I want to support. Raising a bunch of money to be spent the same way it has been spent in the past is not something I’m supportive of.”

Want to go?
•WHAT:
Spaghetti dinner fundraiser to generate money in hopes of placing an admissions tax increase proposal on November’s ballot for Sandusky residents.
•WHERE: Sail In, 631 Meigs St., Sandusky
•WHEN: 11 a.m. to 3 p.m. Sunday
•MORE: $7 dine-in, $8 delivery by calling 419-627-9333. Dinner gets you spaghetti and meatballs, salad, bread and dessert. All funds will go toward the effort to place an admissions tax increase issue on November’s ballot.

Tax potential
Based on 2013 admissions tax numbers, in which Sandusky officials collected $2.81 million, here’s how much different the collection would be with different rates:
•4 percent: $3.74 million
•5 percent: $4.68 million
•6 percent: $5.62 million
•7 percent: $6.55 million
•8 percent: $7.49 million

Comments

bigdad1205

Curious that these commissioners seem more receptive to raising income tax on Sandusky city residents (most of which now earn minimum wage) rather than realizing we are a tourist town and tourist should be paying the bill.

Nemesis

How naive you are. They knew the income tax increase would go over like a turd in the punch bowl, and that the resulting anger would launch this initiative. The leaders of this are talking about TRIPLING the admissions tax, and the commissioners can deny any culpability when it causes Cedar Fair to channel their capital investment budget elsewhere.

Comrade Boose

TRIPLING?? 3% X 2 = wait for it 6%. That is DOUBLING it. Don't mislead the readers. Cedar Point is not going anywhere the admissions tax is low even at 6%.

Nemesis

8% is almost tripling it.

Cedar Point is actually Cedar Fair, a company with many parks across the country, of which CP is only one. 6% is not lower than the ZERO percent admissions tax at their other major Ohio park, which got this year's big coaster investment, moving CP further back in the running for the title of most coasters.

Comrade Boose

The group never said 8% quit misleading everyone the number is 6%

Nemesis

The group's response in the article is that they don't know what percentage they want, but the overwhelming majority of comments in support of the increase on the SR site have called for 8%

Don't blame me; blame your supporters.

JT Adams St

Oddly enough, Cedar Fair has continued to pour money into Cedar Point in spite of the fact that Sandusky has long had a 3% admissions tax, while King's Island, has a 0% admissions tax. Under your theory, Cedar Fair will walk away from a hugely profitable park because their customers, not Cedar Fair, has to pay an extra $1.50 in taxes, which is exactly what hasn't happened over the past 20 years.

Nemesis

"Oddly enough, Cedar Fair has continued to pour money into Cedar Point in spite of the fact that Sandusky has long had a 3% admissions tax, while King's Island, has a 0% admissions tax."

Oh? Who got this year's big new coaster spending? At 3% the last big proxy battle was partially based on rumblings about moving the company headquarters and de-emphasizing CP as the flagship. Nearly triple that and those rumblings will only get louder.

"Under your theory, Cedar Fair will walk away from a hugely profitable park "

Two words: Geauga Lake. Profitable park, hostile community.

"because their customers, not Cedar Fair, has to pay an extra $1.50 in taxes, which is exactly what hasn't happened over the past 20 years."

Do the math - you're talking about adding $3.50 to that $1.50. The park was profitable in the 70's when they considered bulldozing it for a housing development. It was profitable a couple years ago when the proxy battle happened. Keep killing the goose that lays the golden egg, one small wound at a time.

BIGHAWK

Yep look at Murrays powerpoint presentation on the cities website, they are already salivating at the pipe dream of 3.5+/- million for every half percent, of course the justification is how low the income tax in Sandusky is at 1%. That would take the 16 million dollar budget to almost 20, image if they propose 2%, about 7 million extra bucks. They need to look outside of the box such as privatization of Water and Sewer, and eliminating the cities bond liabilities!!

lugnut2511

Hmmm, I believe the taxes,license fees and permits for businesses alone is what ran everyone out of Sandusky to begin with..Good luck with that one.

JT Adams St

I suppose that all of the factories shutting down to relocate their production lines overseas, resulting in hundreds of city residents losing their jobs, didn't have anything to do with it.

Nemesis

Which was caused, of course, by excessive tax and regulatory burdens placed on business at the national level. Businesses exist to make money, and go where the taxes are least.

JT Adams St

No, it was caused by the fact that they didn't want to pay their workers decent wages, and preferred to use much cheaper labor overseas. Cedar Fair has already dealt with that problem by importing cheap labor from overseas.

Nemesis

And are not the NLRA and minimum wage government imposed regulations?

Do you know why Pfizer wants to buy AstraZeneca? Because they want to move out of the USA to avoid our taxes and regulations. They find BRITAIN's taxes less burdensome - that's saying a lot.

T. A. Schwanger

###

Commissioner Poole hit on an extremely important point of "spending existing tax dollars more wisely". Problem is, we taxpayers have been hearing the same for years with no change in spending practices.

Nemesis

and dropping an extra $5 million in their greedy little hands is going to make them more judicious in spending it HOW?

JT Adams St

As a proponent of an increase in the admissions tax, I'd like to say that Andy Ouriel did a nice job of presenting this story.

As for Mr. Poole's comment, I would note that generating additional revenue by increasing the admissions tax doesn't preclude the commission from spending the city's money wisely.

At present, the streets are a mess, Station No. 7 is closing on random days, and there are 300 dead trees that need to be removed. What's the commission's proposal to find the money to address those problems? What programs/services would Mr. Poole cut? Apparently, I missed Mr. Poole's interview with the Register when he ripped the current commission for giving one of the highest paid attorneys in town a raise.

While the commission has managed to "balance" its budget, it has done so by deferring road maintenance and street tree maintenance. Just because the commission chooses to ignore those problems doesn't mean that they magically went away. Although, I suppose the dead trees will be easier to remove after they fall over.

As Mayor Murray pointed out at his town hall meetings earlier this year, Sandusky is desperate for additional revenue. An admissions tax increase is an opportunity to raise that revenue and avoid a death spiral of declining services resulting in middle class residents fleeing town.

Nemesis

"I would note that generating additional revenue by increasing the admissions tax doesn't preclude the commission from spending the city's money wisely."

Actually, it does. Abundance breeds carelessness. The whole reason for the recent recession is that, when the Fed's been effectively giving away money at below inflation interest rates for 15 years, there's no reason for banks to be careful with it.

"At present, the streets are a mess, Station No. 7 is closing on random days, and there are 300 dead trees that need to be removed. What's the commission's proposal to find the money to address those problems?"

Well, another article this week outlined how the city is going to spend $800K on freebies for the dependent class.

JT Adams St

What "abundance"? We keep hearing from Wes Poole and you how the city wastes money. OK. Where's the waste in the current budget? And what programs, in the current budget, is the city going to cut to fix the roads? Or, are roads a waste of money? And without roads, what hope does Sandusky have of attracting any investment?

Nemesis

"What "abundance"? We keep hearing from Wes Poole and you how the city wastes money. OK. Where's the waste in the current budget? And what programs, in the current budget, is the city going to cut to fix the roads? Or, are roads a waste of money?"

A $5million jump in revenue constitutes an abundant windfall, and if you think it will be spent on roads, I have a bridge to sell you. It will be spent on building a lavish new City Hall, and handouts to buy votes from the unproductive segment of the city's population.

JT Adams St

The questions was: Where's the waste? Your answer is non-responsive. what handouts to the "unproductive segment" of the city's population do you want to cut to fund new roads?

Nor'easter

Nemesis, You have the opportunity to be absolutely sure that the money raised is used for streets and trees. Become involved in Rebuild Sandusky and be assured that the additional money is restricted for its stated purpose. There are serious costs for legal services to create enforceable and constitutional language to assure that the funds are only used to Rebuild our community. Put your effort and you money where your Mouth is.

T. A. Schwanger

###

From Sandusky's Codified Ordinances:

195.01 DEFINITIONS.

For purposes of this chapter the following words and phrases shall have the following meanings ascribed to them respectively.

(a) "Admission charge" means any charge for the right or the privilege to enter any place; a charge made for season tickets or subscriptions, a minimum service charge, a cover charge or a charge made for use of seats and tables, reserved or otherwise, and similar accommodations, greens fees, charges for the rental of or use of equipment, facilities or other property for purposes of recreation or amusement such as, but not limited to, charges ordinarily made or collected for the rental of personal watercraft, canoes or paddleboats or the rendering of service unless persons not utilizing the property or services are admitted free; also all parking charges where the charge is determined by the number of passengers in an automobile.

(b) "Person" means an individual, firm, corporation, company, partnership, association, an unincorporated association, and any person acting in a fiduciary capacity.

(c) "Place" includes but is not restricted to, circuses, motion picture theatres, dance halls, auditoriums, stadiums, athletic pavilions and fields, exhibition halls, swimming pools, amusement parks, water parks, golf courses and golf ranges, miniature golf courses, ferry boats, charter boats, bowling alleys, night clubs, cabarets, theatres of all kinds, lecture halls, archery and shooting ranges, campgrounds, recreational vehicle parks, and such attractions as merry-go-rounds, Ferris wheels, sky coasters, roller coasters, race tracks, and all places where any form of diversion, recreation, sport, or pastime is offered or provided, which are located in the City.

Question is, does the City actively collect admissions tax from the listed entities?

(Ord. 05-114. Passed 7-11-05.)

AJ Oliver

I have to respectfully disagree with my friends Wes Poole & Tim Schwanger here. Point One: A three percent admission tax is very much on the low side - in many places its 5 or even 8 percent. Point Two: The city's finances have been devastated by cuts from the state - NOT reckless spending, although there is some of that. Point Three: Tim is correct that all appropirate organizations need to pay the tax, not just CP.
I will help gather signatures.

T. A. Schwanger

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@ AJ Oliver

My apologies for not being clear.

I am not against raising the Amusement Admissions Tax. I do however question the 3% increase (doubling).

If the powers controlling the purse strings can't spend existing dollars frugally, then how can we expect them to frugally spend an additional $2.5 million additional annually ?

JT Adams St

@ T.A. Schwanger

The city is falling behind on road maintenance and street tree maintenance. And nobody is saying where the money is going to come from to pay for those items. The city could have an extra $5 million per year added to its budget, and still be in a hole in maintaining its infrastructure. The frugality argument that people keep making is akin to someone arguing that they're not going to loan their parents money to fix their leaking roof, because their parents wasted money at McDonald's last month. Maybe the $10 spent on hamburgers was a waste, but it still doesn't make economic sense to let the house be destroyed by a leaking roof. Yes, the city wastes thousands of dollars paying commissioners to sit on their hands while the roads crumble around them, but even if the commissioners had to pay $10,000 per year to work for the city, that still wouldn't solve the infrastructure problem.

Nemesis

"A three percent admission tax is very much on the low side - in many places its 5 or even 8 percent"

While you were apparently sleeping, in another discussion thread, it was established that it is ZERO for the other major park in Ohio, which, incidentally, competes every year with Cedar Point for Cedar Fair capital investment.

Note that Pfizer is willing to move their corporation to the UK to escape a hostile tax environment. All Cedar Fair has to do is shift capital improvements downstate.

brett kinzel

Better make sure that admissions tax is legal in the first place. I'm not a lawyer, but there is some law that says taxes must be levied against a group, not an individal. CP pays 98% of the admisiion tax. Better be careful what you ask for, the new management at CP may not be as generous to the local gov't as the last.

T. A. Schwanger

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@brett kinzel

The answer to your question can be found three postings above yours.

WhatTheHeck

Dear Mr. Kinzel.
Cp does not care about Sandusky or any small Mom and Pop business in Sandusky. I would think you would want our streets fixed. A family was almost to Cp last weekend and hit a big pot hole in Sandusky and it cost him $600.00 to fix their car. It was ashame they did not have that money too blow at Cp. What a shame saved a year for that family vacation. Cp can buy the commissioners, but you can't buy us voters. Cedar Fair owns Kings Island and they pay 8 per cent admision tax.

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