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NEWTON FALLS --Village council this week gave initial reading and voted 4-1 to establish a new home construction incentive / income tax sharing program with the Newton Falls Exempted Village School District.
However, Village Manager David Lynch said Thursday he wants to first meet and discuss with the board of education the matter before council proceeds with the ordinance so the second reading by council will be postponed from the Nov. 2 meeting.
"I would like to see a partnership formed with the schools working together," he said.
Superintendent Rocco Aducci said he received a call from Lynch and would be willing to meet with him. He said he was informed by Lynch the ordinance would not be on the council agenda next month.
Councilman-at-Large Tarry Alberini said at Monday's meeting he believes Newton Falls is the only local community to propose a new home construction tax abatement, offered at a rate of 100 percent for 15 years, on all new residential property construction within the village.
Officials said there is a need for new housing to increase the number of students accessing the educational opportunities of the school district. A part of the ordinance, which is scheduled for a second reading at a future council meeting, calls for one-half of all municipal taxes paid by the residents of the new homes to be paid to the schools.
Third Ward Councilman Lyle Waddell said the program will provide income tax to the schools, which do not receive income taxes. The schools do receive real estate property taxes.
"This is a great program for new homes and allows for sharing of income tax for the schools. It is a win-win for everyone," Waddell said.
Lynch said the abatement program is for any new residential homes built in a 15-year period with residents paying no real estate taxes but income tax based on those working in the household -- with half the total income tax for the schools.
He said if a household has an annual income of $200,000 then half of the income tax goes to village and the other half to the school district. The amount depends on how many incomes are in the household, he noted.
Second Ward Councilman John Baryak, who voted against the ordinance, said he wanted to hear first from the board of education before taking a vote. "I want to hear what the board members think about this," he said.
Baryak said he feels council is "putting the cart before the horse" without speaking first to the school board.
Waddell said the homeowners can apply for forgiveness on their property taxes.
The ordinance indicates taxes on newly constructed homes would be abated. The owner of the home is liable for all taxes associated with the improved value of the land only.