NILES - Niles residents who work in another municipality are in line for some relief when they file their 2014 Niles Income Tax returns, as council on Wednesday reinstated the city's 1.5 percent income tax credit.
The decision repeals one made at a special meeting last year to reduce reciprocity, or the credit for tax payments to another municipality, to 1 percent. Without the credit, residents were left responsible for the remaining half percent of the Niles tax.
Councilman-at large Steve Papalas said the reduction of reciprocity netted the city an estimated $300,000, but council decided the city had bigger financial issues that the controversial ordinance did not address.
"We passed the ordinance last year because we were uncertain of what our city budget was going to be and we needed to bring in more revenue," Papalas said. "We know what the problems are now, and we feel like we can get by (without the additional revenue)."
The issues Papalas referred to are the ongoing trouble with collecting delinquent utility payments.
During a roundtable earlier this month, Mayor Ralph Infante informed council the city was owed roughly $500,000 in past-due utility payments. Auditor Chuck Nader said outdated billing software meant the city did not have an accurate picture of the money it was owed and, as a result, it was not aggressively pursuing delinquent customers.
Infante told council Wednesday the city is going forward with massive water shutoffs of customers who are 90 days past due in payments. Along with the installation of new utility billing software, Papalas said the benefits of the reduction in reciprocity are no longer worth the controversy.
"I think a lot of people in our community not only find (the reduction) unfair because they end up being taxed twice," Papalas said. "We have a (better idea) of our issues now we're due more than (the money earned) in delinquent utility payments."