With so many people working remotely, there's a debate over where their city income tax dollars should go.

This money makes up a large amount of a city's budget and supports services such as police and fire.

As of now, remote workers are paying income tax to the city they worked before the COVID-19 pandemic hit if they already have a tax on the books.

However, there's now a bill, (SB 352) in the Ohio Senate that would change this, and finance officials said it could have devastating consequences for cities like Warren and Youngstown.

There are two clear sides to SB 352 passing: One is that cities could face devastation if they lose income tax paid by remote workers, but the opposing argument asks the question, "Why should people have to pay taxes to a community when they no longer benefit from the services?"

Chief Legal Counsel for Youngstown's Regional Income Tax Agency (RITA) Amy L. Arrighi, said the city collected $44.65 million from employees and employers in 2019 from the 2.75 percent city income tax.

Kyle Miasek, Youngstown City Financial Director, said that business net profits (2.75 million) and employer withholding which is not eligible for refund removes (around $7 million) from employees who live within the city, leaving nearly $35 million in the city income tax withholding.

He said over $11-million is generated by remote workers, $2.4-million goes to the police department and $1.8-million goes to the fire department -- money that would be lost if Senate bill 352 passes. 

Senator Kristina Roegner, R-27 of Akron, proposed SB 352, which repeals the commuter-tax language of House Bill 197,  the coronavirus relief bill, which Governor Mike DeWine signed in late March, mandating companies must continue to withhold their employees' taxes based on their office's physical location.

The law currently allows for employers, such as in Youngstown and Warren, to keep withholding income taxes from remote employees working from their homes and not currently working within the city.

"Senate Bill 352 says you know, what if you are living from home, working from home... That's where your services are provided. That's where your tax dollars should go," Roegner said. 

Unless you work in a township; Townships like Boardman and Austintown legally can't collect income tax, so in that case, the money would be refunded to the employee.

Youngstown Councilwoman and Chair of the Finance Committee, Lauren McNally, thinks it would cause catastrophic problems for already struggling cities.

"That's almost 100 percent of how we pay our bills through income tax, so if now we are not getting that income tax, that is going to have detrimental effects. We can't pay our bills," McNally said. "We can't do it. I can't for the life of me figure out why anybody would want to set up the state's major cities to fail. It's not like you can let them collapse into economic turmoil and not be able to have fire and police and road paving."

Income taxes also fuel Warren's economy.

With an annual budget of almost $18-million dollars, the city could lose more than $5-million dollars if remote workers no longer pay the tax. 

Thomas Gaffney, the tax administrator for the city of Warren, said the city receives the most significant portion of the city's annual budget from the income tax.

Gaffney said the employer withholding for Warren's 2.5 percent city income brought in $17,177,566 in 2019.

Using the same one-third employees working from home would mean the city could lose up to $5,668,596 in money that could potentially have to be refunded to taxpayers.

If the number of remote workers is at 40 percent working outside the city limits, the refund amount would be $6,871,026.

"That's a quarter of our budget," Gaffney said, "You're talking layoffs and the safety forces, massive layoffs... In a way, you're defunding the police department and the fire. It would be devastating."

However, Roegner says it's really simple; Taxpayers' dollars should follow them, and cities like Youngstown and Warren caught a break by collecting them since the pandemic hit five months ago.

After asking if she considered cities who are struggling and the impact the bill could have on them, she said, "Yes, and that's why we did pass HB 197 back in March, so if you think about it, since March... for the last five months, many of these cities have been collecting income tax and not providing services to those individuals."

As far as the chance of SB 352 being signed into law, the Ohio Senate is just getting back into session and local State Senator Mike O'Brien said he's already spoken with three-quarters of the caucus, and they all plan on voting against the bill. 

Meanwhile, Roegner's proposal follows a pending lawsuit filed by the Buckeye Institute, a think tank in Columbus.

Lawyer Robert Alt claims DeWine's income tax change in the coronavirus relief bill is unconstitutional.

21 News reached out to Governor Mike DeWine's office for comment, but have not heard back on whether the governor supports the legislation.