Uhrichsville asks judge to dismiss Dennison suit over income tax payments
NEW PHILADELPHIA — The city of Uhrichsville has asked a judge to dismiss a suit filed by the village of Dennison over a disputed income tax sharing agreement between the two municipalities.
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Until 2020, Uhrichsville had been paying 37% of city income taxes collected from Claymont High School employees to Dennison under terms of a 1998 agreement between the two communities. The pact settled a tussle between the neighboring towns over where their new high school would be built. Prior to the consolidation that created Claymont, each had its own high school.
The high school was built on land annexed to Uhrichsville. It opened in 2001.
The tax agreement is expressed in a "letter of intent" signed by officials of both municipalities.
Dennison contends that Uhrichsville has breached the mutually agreed-upon contract by failing to make payments.
In a motion filed in Tuscarawas County Common Pleas Court seeking dismissal of the case, attorneys for Uhrichsville say the city has not breached the agreement, but has properly exercised its right to terminate the pact.
Attorneys for Dennison, Patrick Williams and Kevin Lundholm, replied in their filing with the court that the motion to dismiss is actually a thinly veiled motion for summary judgment.
They wrote that the court should deny the motion for dismissal or treat the motion as if it were a motion for summary judgment, and give Dennison enough time to gather evidence to respond.
In asking the court to allow the case to proceed on the merits, Lundholm and Williams wrote, "The court simply cannot find, at this stage of the proceedings, that 'beyond doubt', there is no set of facts which can be established to entitle Plaintiff to relief."
Uhrichsville's motion, submitted by Lydia Reback and Catherine Strauss of the Columbus law firm Ice Miller LLP, makes these points:
• The "plain language" of the letter says it becomes void, invalid or illegal if counsel for either municipality determines it to be so.
• The agreement creates a debt that violates the Ohio Constitution.
• The suit asks the court to force Uhrichsville to expend public funds despite a legal opinion to the contrary.
Uhrichsville stopped paying Dennison a share of the high school income tax collections after Mark Haney took office as the city's mayor in 2020. He obtained a legal opinion from Ice Miller that said the agreement with Dennison was invalid.
Judge Michael Ernest is scheduled to hear arguments Tuesday about the motion to dismiss from attorneys representing Uhrichville and Dennison.
Reach Nancy at 330-364-8402 or nancy.molnar@timesreporter.com.
On Twitter: @nmolnarTR
This article originally appeared on The Times-Reporter: Court hearing Tuesday on Twin Cities' income tax dispute
