A majority of Toledo City Council voted Friday to side with Mayor Paula Hicks-Hudson and ask voters in March to increase the city payroll tax from 2.25 percent to 2.5 percent.

Council voted 9-3 in favor of placing a temporary 1 percent income tax on the ballot instead of asking voters to renew the temporary 0.75 percent tax.

Councilmen Rob Ludeman, Mike Craig, and Sandy Spang voted no.

If voters approve, the new income tax total of 2.5 percent would take effect July 1.

Mr. Ludeman offered an alternative plan to place the 0.75 percent tax’s renewal on the ballot along with a separate 0.25 percent income tax, also temporary, from which revenue would be dedicated to street improvements and repair.

“I think my plan was more acceptable to dedicate a certain funding to road repair and my ordinance was very specific,” Mr. Ludeman said.

Only he and Councilman Tom Waniewski voted in favor of that idea.

The 2.25 percent tax is expected to generate $167.5 million next year. At 2.5 percent, it would generate $18.6 million more, for a total of $186.1 million.

Finance Director George Sarantou said Mayor Hicks-Hudson’s plan is to dedicate $16.6 million — almost 90 percent of additional revenue from the tax hike — to capital improvements, including streets. The other money would be used to pay for hiring police officers and firefighters earlier next year rather than November.

“The administration’s plan here is to address the public’s huge concern about streets, but also public safety,” Mr. Sarantou said.

The income tax is divided between the city’s general fund and capital improvements budget under a formula outlined in the Toledo Municipal Code.

Mr. Sarantou on Thursday mistakenly said the city charter dictates how that revenue is split. While changing the charter would require voter approval, the municipal code can be changed by a majority vote of council.

Of the current 2.25 percent tax, 1.5 percent is permanent and 0.75 is a temporary portion renewed by voters every four years for 33 years. The permanent tax’s revenue, about $111.7 million, must be split with five-sixths going to the general fund and one-sixth to capital improvements.

At a full 1 percent, the temporary tax would generate $74.4 million, of which two thirds must go to the general fund according to city code and one third must go for capital improvements.

Under those splits, the combined and increased income taxes would provide $142.7 million for the general fund and $43.4 million for the capital improvements budget next year if the city payroll meets the Hicks-Hudson administration’s forecast.

Of the capital-budget amount, $26.8 million must be spent on debt obligations, including debts for previous street projects, and the 1 Percent for the Arts program. Mayor Hicks-Hudson said much of the remaining $16.6 million would be spent on streets.

Councilmen debated the tax-hike proposal for more than 90 minutes before voting during a special meeting.

“If we are going to tell the people we are going to use this for capital improvements, than that’s what we should do,” Councilman Tyrone Riley said before voting in favor of the mayor's plan.

Chief of Staff Bob Reinbolt later spoke to Mr. Riley and said: “We need that other 10 percent for the police class to bring that forward.”

Since more money would be funneled into the general fund with an income tax increase, the city will be able to transfer less money from the capital fund into the general fund next year, and none in following years, Mr. Sarantou said.

Mayor Hicks-Hudson’s proposed 2016 general fund budget included taking $10.4 million from the capital fund for street repair and using that money for the general fund and related expenses, police and firefighter salaries. The proposed 2016 budget will be revised so only $5.2 million is transferred from the capital improvements fund next year if the income tax increase passes.

Mr. Sarantou said the increased money from the higher income tax would send more money into both funds and allow the city to halt the practice of shifting millions from capital improvements to the general fund, a practice approved by voters starting in 2010.

The new tax request would prohibit such transfers after June 30.

In addition to hiking the income tax, the proposed general fund will be balanced next year by increasing Toledo’s monthly trash-collection fees, from $8.95 to $15 for most households and from $5 to $8.50 for senior citizens with homestead exemptions.

Mr. Craig said he voted against placing the tax hike on the ballot because of questions he has about money from the trash fee.

Ms. Spang said the city should ask voters only to renew the 0.75 income tax and cut costs aggressively.

Toledo should seek the 0.25 percent increase, she said, “only if it has been clearly demonstrated that cuts cannot be made — an outcome I do not anticipate.”

Contact Ignazio Messina at: imessina@theblade.com or 419-724-6171 or on Twitter @IgnazioMessina.

First Published December 12, 2015, 5:00 a.m.