Less than a week after being put on the November ballot, the half-cent Hamilton County sales tax hike being sought to build a $2.6 billion light rail system and upgrade the county's existing bus service has hit its first political speed bump.

        Calling the proposal by Metro “double taxation” on city residents, the chairman of Cincinnati City Council's Finance Committee says he opposes the Nov. 5 ballot issue.

        Pointing out that 0.3 percentage points of Cincinnati's 2.1 percent earnings tax supports the Southwestern Ohio Regional Transit Authority, Councilman John Cranley also said he would introduce an ordinance to repeal the transit earnings tax if the sales tax passes.

        “Right now, as structured, it is horribly unfair for city taxpayers. It's also unfair for Hamilton County,” he said. “There's nothing I'd rather see than a sensible regional transit system, because it sparks economic development and gets people to jobs. But fair is fair.”

        The transit board, which oversees the county bus service Metro, last Tuesday approved the ballot initiative. The 30-year plan calls for five lines and 65 miles of track within Hamilton County. The tax would also help pay for $110 million in improvements to the current bus system, including the construction of transit hubs throughout the city and county and new cross-county lines.

        The transit authority's local funding comes almost exclusively from the Cincinnati earnings tax. The earnings tax levy's approval in 1972 followed an unsuccessful attempt to get county voters to approve a property tax levy for transit. Two subsequent attempts to raise the county sales tax, the last in 1980, also failed. As a result, Cincinnati has one of the few regional transit systems funded by a city earnings tax.

        Metro general manager and chief executive officer Paul Jablonski said the proposed new tax was fair to both city and county residents. He said that the current earnings tax would continue to fund existing service and that the new tax would cover the new items.

        The current earnings transit tax raises about $36 million annually, covering about half of Metro's $72 million annual budget, with the rest coming from federal and state sources, as well as fares.

        The sales tax, which would raise the county rate to 6.5 percent, is expected to raise about $61 million annually if passed. That would be about a quarter of the annual cost of the MetroMoves project; the agency is counting on federal and state funds for the rest.

        Mr. Jablonski said that 50 percent of all the proposed rail lines would be within the city limits, and 40 percent of the bus enhancements would also be within the city.

        “It gets down to who gets what, and I think that's a pretty fair shake for the city,” Mr. Jablonski said. “We had two options - either this or eliminate the earnings tax and seek a three-quarter-cent tax hike to overcome the difference. So it would be two different taxes or one big tax, and we felt that this was fairer.”

        Mr. Cranley's opposition is just one indication of the resistance to the tax increase at City Hall. Mayor Charlie Luken has yet to endorse the issue, and has been publicly critical of the transit authority's ad campaign that accompanied the release of MetroMoves.

        In a memo prepared for the council, City Manager Valerie Lemmie has identified the earnings tax issue as one of three “major areas of concern” with the transit plan. The other concerns are about urban sprawl and the location of routes and hubs, although Mr. Jablonski said that city officials have been “intimately” involved in the planning of the new system from the start.

        The day after the transit board voted to put the tax levy on the ballot, the city solicitor delivered a legal opinion about what it would take to overturn the transit earnings tax.

        The short version: City Council could give six months' notice to cancel the contract “for any reason deemed necessary to protect the public interest,” and ask voters to repeal the tax in the city's charter.

        City Hall would then own the bus system, although no one is taking seriously the idea of having the city run the buses. But Mr. Cranley said he would still try to eliminate the earnings tax if county voters approve the sales tax.

        “It would be absolutely insane not to,” Mr. Cranley said.

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