Today I want to give you an update on R.I.T.A. – Regional Income Tax Agency.
When I was City Treasurer I did a two year analysis of the city’s tax department
versus the Regional Income Tax Agency. There were numerous meetings and phone
conferences with R.I.T.A representatives. I interviewed several municipalities both large
and small that were using R.I.T.A. I visited a few existing customers including Strongsville
I came to the conclusion it would benefit Bellevue to hire R.I.T.A. for three primary
reasons. It would lower the cost to the city. It would provide better service to local tax
professionals and individual taxpayers. Finally, it would increase total tax collection.
I believe all three objectives have been met.
The change to R.I.T.A. was made, with 2008 being the first full year of tax collection.
I am happy to report that the results are very positive.
The last year that Bellevue had a tax department the budget for that year was
In the six years of R.I.T.A’s services their bill has been substantially less. R.I.T.A.
charges a 3% fee for their services. They provide over 60 tax collection and system services.
If R.I.T.A. can collect the taxes for less than the 3% they give a rebate. Every year R.I.T.A.
has been successful in keeping their cost down and giving Bellevue substantial rebates. The
overall rate R.I.T.A. has charged is as follows:
RITA’s cost City Tax Dept RITA’S COST SAVINGS
2009 2.33% $250,000 $71,571 $178,429
2010 2.16% $250,000 $71,383 $178,617
2011 1.86% $250,000 $66,286 $183,714
2012 1.84% $250,000 $67,089 $182,911
2013 1.78% $250,000 $71,899 $178,101
2014 2.06% $250,000 $68,297 $181,703
Total Savings $1,083,475
Now if we assume the tax department budget remained the same which is normally not
the case, below is the approximate annual savings.
Tax forms can be obtained through R.I.T.A’s website. They are constantly working to
improve the ease of using their website.
Recently the Ohio General Assembly passed and Governor John Kasich signed into law
Sweeping changes to the administration of municipal income tax that will go into effect
January 1, 2016.
R.I.T.A. has already designed and structures the forms and provided them to Bellevue.
The city simply has to fill in their name and personalize information and present it to council for
approval. As Dave Wallingford, City Law Director, said at last council meeting, “this saves the
city a substantial amount of time and money by having R.I.T.A’s services”
But the best news has to do with the collection of taxes. R.I.T.A. has the ability to cross
check city tax returns with individual and corporate federal returns. It took R.I.T.A. several
years to convince the IRS to agree to this relationship because of the sensitive information. This
is a significant tool that municipalities that run their own shop do not have. Only R.I.T.A.
Why is that big?
Say John Doe works at ABC factory for 6 months then goes to work at DEF factory the
other six months. He turns in his 1099 for the earnings from his first job but not his second. A
City with its own tax department isn’t capable of knowing this information. This past year
alone R.I.T.A. was able to collect an additional $20,000 from being able to compare returns and
notify filer of this error.
They can also compare corporate returns. A recent comparison found a local corporation
hadn’t been paying their corporate tax. The end result, the city recently received a deposit of
over $700,000 of additional revenue. You read that right, over $700,000.
The administration and council have been discussing for some time how could we come
up with the $600,000-$700,000 needed for the East Main Street project that was coming up
shortly. Our prayers have been answered.
If you add it all up, the change to R.I.T.A. in the 7 plus years has been a savings of
Recently the Bellevue Central Park had their first concert in the park with Walt Sanders
and the Cadillac Band. As I sat there enjoying the music I couldn’t help but think if the change
to R.I.T.A. hadn’t taken place the city more than likely wouldn’t have had the $50,000 in
revenue that they have invested in the park. Nor would we be in a position to invest around
$175,000 in the upcoming bike trail that is bringing almost $1,000,000 in grant monies from the
federal and state.
RITA has lowered the tax departments cost and increased revenue. No other city
department can make that claim.
R.I.T.A. is a great example of creative ways municipalities can increase services and
lower costs. This is a growing trend across the country.
The word is getting around the State of Ohio. When Bellevue signed on to R.I.T.A. they
were their 130th city. R.I.T.A. recently announced they have now grown to over 250
municipalities. They have almost doubled in size in less than 8 years. Obviously they are doing