By Megan Alley
Sun staff

Voters in the village of New Richmond could be asked to consider an earnings tax increase this November.

During its June 28 meeting, the village council approved the first reading of a resolution that would put the increase to a public vote.

Currently, the village imposes a 1 percent earnings tax on people who live or work in the village; residents who pay taxes to other municipalities are given a 0.5 percent tax credit.

The council discussed floating a ballot measure that would increase the earnings tax to 2 percent, but details still need to be fleshed out, according to Administrator Greg Roberts.

Council passed the current 1 percent earnings tax in late 2009, and collection began in January 2010, according to Lynn Baird, fiscal officer. An increase beyond the 1 percent has to be approved by voters, according to Roberts.

The current earnings tax generates approximately $500,000 per year, according to Baird. An increase to 2 percent would generate another $500,000.

While the council hasn’t yet provided clear guidance on how to “slice and dice” the additional funds, council members discussed earmarks for police and for the fire and emergency services department, according to Roberts.

“Our police department, fire and EMS are challenged with issues surrounding the opiate epidemic,” he said. “Our officers are paid relatively low salaries, and they’re getting lured to other high-paying positions in other communities.”

He added, “We’re fighting these problems with one hand tied behind our back.”

New Richmond contracts with the Regional Income Tax Agency to administer the village’s earnings tax. RITA charges a 3 percent fee for this service, according to Baird, so the village would pay approximately $15,000 to collect $500,000.

The earnings tax is collected through payroll deductions or through quarterly payments to RITA. The agency has access to income tax return information and will seek to collect taxes from those individuals who have not submitted payments throughout the year, according to Baird.

The council will hold a second reading of the resolution during its meeting on July 12, according to Roberts.