SOLON, Ohio – City Council has passed a resolution of support for Issue 55 – the replacement of the Cuyahoga County cigarette tax for the county’s arts and culture fund on the Nov. 5 ballot.
On third reading Monday (Oct. 7), council voted 5-2 in favor of the resolution. Ward 4 Councilman Mike Kan and Ward 2 Councilman Robert Pelunis cast the dissenting votes.
Cuyahoga County voters are being asked to decide whether to more than double the tax on cigarettes to support the fund.
If Issue 55 passes, the existing tax of 1.5 cents per cigarette will be terminated and replaced at the rate of 3.5 cents per cigarette for 10 years.
The new amount is estimated to generate about $160 million over the next decade.
The county instituted the cigarette tax in 2006 to support nonprofit arts and culture organizations. The tax was renewed in 2015.
Peter Lawson Jones, a Shaker Heights resident and former Cuyahoga County commissioner, encouraged council members to support the cigarette tax levy.
“I volunteered for this campaign because it’s kind of personal for me,” he said. “I was one of the early architects of Cuyahoga Arts and Culture when I was a county commissioner.
“I’m also an actor and a playwright. I’ve seen firsthand what the support of the generous citizens of Cuyahoga County through Cuyahoga Arts and Culture has meant.”
Jones noted since the inception of the tax, Cuyahoga Arts and Culture (CAC) has distributed more than 4,000 grants totaling nearly $250 million to 485 nonprofit organizations and “a countless number of individual artists.”
With an economic impact in the county of $533 million, the tax has helped to create and-or support 10,200 jobs, he said.
“It’s made a difference right here in Solon,” he said.
Jones listed some of the nonprofits based in Solon that have received “generous” support from CAC. They include Arts Without Borders, Cleveland Contemporary Chinese Culture Association and Fostering Hope.
Jones said the cigarette tax is “kind of a good news, bad news story.”
“The good news is smoking has gone down in Cuyahoga County because of that tax,” he said.
“But on the other hand, because fewer people are smoking now, the revenue that was generated from the initial cigarette tax levy has decreased by 50 percent.”
In 2006, the levy was generating $20 million per year, Jones said. But now it’s down to $10 million a year.
“So that’s why there’s a replacement on the ballot imposing a tax of 3.5 cents per cigarette,” he said.
Jones claimed Cuyahoga County gives more public support to arts, artists and arts and cultural organizations per capita than “virtually any county in the country.”
“So we’d like to continue to be No. 1, or at least in the top 10 in that regard,” he said.
“The passage of this levy on this cigarette tax can make that kind of difference.”
Pelunis asked Jones why the Solon Center for the Arts has not received funding from CAC.
“I was kind of shocked that (the arts center has not) received any funding,” he said.
Jones said he was surprised about that, as well, and that he didn’t have an answer.
“I’m not on the board of CAC nor am I a member of the staff,” he said. “But you have to apply (to CAC) for funds.”
Mayor Ed Kraus said traditionally, the Solon Center for the Arts has not applied to CAC for funding.
“We have a grant writer now, so I’ll talk to Tracy Sullivan about this,” Kraus said.
Sullivan, the city’s director of community and cultural engagement, serves as manager of the Solon Center for the Arts.
Ward 7 Councilman Brian Laubscher asked if the tax applies to cigarette sales only. Jones said it does.
“There have been efforts made to explore other revenue sources, other than merely reliance on cigarette tax, but this is what the state legislature has permitted Cuyahoga County to place on the ballot to support CAC’s efforts,” he said.
Solon Ward 4 Councilman Mike Kan says he believes Cuyahoga County Arts and Culture should do its own fundraising, rather than relying on the passage of Issue 55 on the Nov. 5 ballot to collect and distribute money through grants to nonprofit arts and culture organizations in the county.(Ed Wittenberg, special to cleveland.com)
Kan explains ‘no’ vote
Kan noted that Cuyahoga County is the only county in Ohio that has a dedicated tax revenue stream to fund the arts.
“Other counties use private foundations or money that is allotted from their general budget,” he said. “The cigarette tax is the CAC’s only funding source.”
CAC does not fundraise, Kan said.
“Their director (Executive Director Jill Paulsen) said they don’t fundraise because they don’t want to compete with the organizations they are funding,” he said.
“I’m sorry, but I don’t agree with this rationale.”
Kan said since council would be voting on a resolution, rather than legislation, its vote is “largely symbolic.”
“I’m not a smoker,” he said. “I’ve never smoked a cigarette in my life, and I do support funding of the arts.
“But in my very humble opinion, this ballot resolution is not the way to do it.”
Kan then explained why he feels that way.
“First, this is a regressive tax,” he said. “We know that the majority of smokers are lower-income people and people of color.
“Most people who consume the arts are higher income. So it’s largely a transfer of wealth from lower-income people to higher-income people in a time when costs are still high.
“Second, there’s no nexus between the activity we’re taxing here and what the tax is being used for: to fund the arts,” he continued.
“I may consider supporting this if it was for clean air or to fund anti-smoking or anti-substance abuse programs. But there’s no nexus between cigarettes and the arts.”
Finally, with revenue from the cigarette tax declining, it’s not likely that an increase in the tax is going to increase that revenue long term, Kan said.
“This is based on economics,” he said. “People will adjust their behaviors and purchasing habits.”
An example, Kan said, would be purchasing cigarettes in a neighboring county.
“We’re in Solon right now,” he said. “It’s not hard for us to get to Twinsburg, which is in Summit (County), or to Bainbridge, which is in Geauga (County).
“A better plan, I believe, would be for CAC to do their own fundraising. If they want more money from the general public, they should probably raise funds for themselves.
“It’s better to explore other sources of revenue,” he continued. “At least a foundation could be established.
“The revenue is drying up now. Why do we think that increasing the amount we tax on poor people is going to increase that revenue?”
Kan said he’s realistic and that Issue 55 will probably pass countywide “because there are more non-smokers than there are smokers.”
“But I cannot support on principle this regressive tax increase,” he said. “Both progressives and conservatives should not agree with it.
“You’re taking money from poor people and giving it largely to higher-income people. So I respectfully will be voting no on this symbolic resolution.”
Jones told Kan that his objections were “not at all ill placed” and that he didn’t disagree with his comments.
“What has to happen is the (state) legislature has to give us another option to raise funds,” he said.
“Is it a regressive tax? Yes; I said the same thing myself.
“Is there a connection between cigarette smoking and support of the arts? Not really.
“But this is the option the state legislature has given us, and it would behoove us all to do everything that we can to lobby the legislature to give us some other options, where there is a connection between the source of revenue and how the funds are used.”
