The Carmel City Council on Oct. 7 unanimously voted in favor of increasing the local income tax to fund Hamilton County’s 911 dispatch center and make other public safety improvements.
The tax increase was already set to go into effect Jan. 1, 2020, because city and town councils representing more than half of the county’s population already approved the measure. Some officials in Hamilton County believe Westfield’s approval will be ruled invalid on a technicality, so Carmel’s vote ensures the tax will be implemented.
The local income tax will increase from 1 percent to 1.1 percent. Hamilton County Commissioner Christine Altman said .1 percent is the smallest amount allowed to be implemented according to state law. The approval is expected to raise $16 million per year, which is $5 million more than its current budget.
“Yes, it does over-collect, but quite honestly we’re out of room at the dispatch center,” Altman told the council before the vote. “We have a problem there and we’re either going to have to expand or find another location.”
The money collected through the tax increase can only be used to fund public safety initiatives, according to state law.
Currently, Hamilton County cities and towns pay a fee determined by call volume to use the dispatch center. The county’s biggest four cities previously subsidized use of the center for the smaller municipalities but decided they no longer wanted to pick up the $500,000 tab. The county was phasing in the costs and covering the difference for the smaller communities beginning this year, but they were not expected to be able to pay their share in the future.
“The smaller towns do not have that,” Altman said. “When we went knocking on their doors, this was devastating to them. They simply don’t have the funds to cover another $100,000 in their budget, that’s how tight they run.”
Carmel was set to pay $2.4 million to use the dispatch center for 2020. Instead, the city will use those funds to improve local public safety initiatives, Carmel Mayor Jim Brainard said. The city is planning to hire 15 new firefighters next year, which requires purchasing equipment and training for them.
“All of those savings would be used on that public safety enhancement,” he said.