A new report from the Ohio Mayors Alliance suggests one out of every three Ohioans will continue working from home long after the pandemic ends.
The report highlighted 10 cities throughout the state including Akron, Elyria, and Strongsville, and showcased how each city could see a loss in municipal income tax revenue as a result.
Keary McCarthy serves as the executive director at the Ohio Mayors Alliance.
“The biggest takeaway is work-from-home is here to stay,” he said. “Work-from-home, while convenient for workers and employers, does have unintended consequences on the fiscal health of cities.”
For those unfamiliar with Ohio’s municipal income tax system, cities tax both their residents and people who work in the city but don’t live there. As this report points out, if there aren’t as many commuters coming into work, that’s a loss for a city’s tax base.
The report estimated a city like Strongsville could see a loss in income tax revenue anywhere from $1-2.2 million, while Akron could see anywhere from $7.8-20 million in lost income tax revenue.
“This is something that affects the big cities, but it affects a lot of communities of varying sizes and geography,” McCarthy said. “This is a decline in infrastructure dollars, a decline in ability for cities to be able to create vibrant communities, often epicenters of our region.”
News 5 reached out to both the mayor of Elyria and the mayor of Strongsville, both of whom are members of the Ohio Mayors Alliance. Neither were available for comment.
Going forward, McCarthy told News 5 this shift in business could also change the way communities attract new business.
“We often incentivize employers to come to cities based on tax revenue that we'll get from their workers being there,” he explained. “But if that's not the case anymore, there's going to be some challenges ahead as we think about the best ways to attract new employers to our cities and our regions.”
