SALEM — Salem and Perry Township officials remain divided on the matter of a cooperative economic development agreement between the city and township to govern the terms of future annexations.

Officials from both municipalities convened in a joint session Wednesday to discuss the current draft of an agreement which would see tax revenue from annexed properties split between the city and township and solidify terms upon which future annexations could be conducted. Under the proposed agreement, 70% of the income tax revenue collected from property would be retained by the city, with the remaining 30% being paid to the township, which cannot collect income tax normally, as a fee, while property tax revenue from the property would be split down the middle with the city and township both receiving 50%. The agreement also specifies that while the city would take over emergency services for annexed properties, the municipalities would maintain their mutual aid agreements.

Both Board of Trustees Chair Steve Bailey and Mayor Cyndi Baronzzi Dickey said that the agreement’s current state, which was drafted by an attorney specializing in annexations and intergovernmental agreements, was the product of months of work by both city and township officials, with Bailey providing a detailed timeline of the process from its beginning in October through Wednesday. Both also stressed that a formal agreement needed to be completed for collaboration between the city and township as major developments which would benefit both under such an agreement were being missed out on without one, with Dickey noting that a $20 million development considering the area had already found another site while negotiations were ongoing.

Councilmen Jake Gano and Evan Newman both raised concerns over the division of municipal services and specific percentages of the proposed tax revenue splits. However, the question of how to to address the 159 properties within the township with deed restrictions mandating annexation into the city to retain city water and sewer service should the property ever become contiguous remained the main source of disagreement.

When Councilman Jeff Stockman asked if an agreement had been reached regarding the handling of the restrictions, Dickey said that the section of the agreement regarding those restrictions had been removed, prompting Bailey to ask when it was removed as he was under the impression that the draft of the agreement being discussed included that language. Dickey said it had been removed earlier that day because it hadn’t been agreed upon, and Bailey said that he had not seen that a new draft was sent.

“I did not see the different agreement on this, I thought we were discussing the one [the township] proposed today. I know we talked about this as an item we were going to discuss…that was the one that has always been kind of the sticking point, and I thought it would be beneficial for everyone in this room to discuss that,” said Bailey.

“What we said earlier in the day was that because that wasn’t agreed on and this is supposed to be to talk about the things we agreed on, that we were going to take it out and if you wanted to talk about putting it in you were welcome to do that with council and the trustees,” said Dickey.

Stockman asked what the removed section stated, and Bailey said that the section would freeze enforcement for those deed restrictions for the length of the agreement; however, Dickey raised concerns that the section would also prevent the city from forming any new agreements of that nature, arguing that it would allow people to request city water and sewer services with no requirement to annex.

“In essence what it’s saying is they could get our water and sewer without having to annex even if they’re contiguous and that they would not have to have a deed restriction and could ask for water and sewer anywhere in the township even if they aren’t close to us,” said Dickey.

While township officials reiterated that they feel people should not be required to annex if they do not want to and instead be given the choice or whether or not to annex, with Bailey noting that a resident who would not otherwise have ever become contiguous to the city may become so as other adjacent properties do so, city officials argued that being permitted to receive city utilities without annexing or without a contract requiring annexation removes the incentive to annex.

“My concern is if we don’t require annexation for people who are contiguous to get our services, to use our services, what is the incentive for anyone to want to annex. I mean, they’re doing it for a reason, because they want something from us and if we give that up, we lose,” said Dickey.

Bailey argued that this was not the intent of the agreement and that the incentive would be to stop paying the 1.5% surcharge for non-city residents. Stockman also argued that was not sufficient incentive. Bailey asked what other municipalities the city sells water to, and whether they pay the same surcharge as township residents or have similar deed restrictions. Utilities Commission Chairman Bob Hodgson said that the city also sells water to Leetonia and Washingtonville and that residents there pay the same surcharge but that deed restrictions were not required. Bailey then argued that residents further from Salem were not subject to the same conditions to receive city water. However, Dickey and Gano both argued that this was not a fair comparison as properties in Leetonia and Washingtonville were too far away to be realistically annexed and developed by the city unlike Perry Township.

Hodgson also pushed back on concerns raised by Trustee Tony Ieropoli that residents did not know they had those deed restrictions, or that the restrictions were in any way hidden.

“One of the things we’ve read a lot is that folks don’t know they signed a restriction. The procedure if you’re in the township and want services you come to the utilities department and you are given a packet that outlines the specific steps that you need to do. You go down to the county, you file for annexation, you bring the statement back and then if you cannot annex you bring a deed restriction that you’ve had recorded and then you are given services,” said Hodgson “There never was a surprise or anything hidden, it was all very open and above board and Steve you made a comment that’s very appropriate. If you bought a property from someone else who signed a deed restriction and either the title company did not disclose it to you, which is an errors and omissions issue, or you just didn’t read it or left it off that is not deceit on the part of the city or the utilities department.”

It was ultimately agreed that after more than an hour of discussion that it would be best to break for further research and revisions and reconvene as a joint body for further discussion in a few weeks. As the meeting concluded Dickey told the township residents in attendance that while public comment had not been accepted at that meeting, it would be in the future when the agreement was closer to completion, and that in the meantime, they should address those concerns through the trustees and their meetings.

The city council will meet next 7 p.m. Aug. 5, and the board of trustees will meet next 4 p.m. Aug. 11.