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HAMILTON — Not charging residents the kilowatt-hour tax was a way to help the city's electric department become more competitive, but now the tax would help fix the city's financial woes.

City Manager Mark Brandenburger addressed the issue Tuesday, Nov. 18, as the City Council considers repealing two-thirds of the tax credit that city leaders adopted in 2001.

"Every business I talked to is against it," said Kenny Craig, president of the Greater Hamilton Chamber of Commerce, who said the tax will hurt local businesses.

Craig said the chamber "strongly encourages" the council to take the "tough steps necessary" to fix the general fund without the additional tax. But, if the council repeals the tax credit, Craig said the chamber recommends limiting the length of time the additional taxation would be in place.

If the tax will save jobs in the police and fire departments, then it's worth supporting, said Linda Kimble, executive director at Serve City.

Kimble said the ministry, which serves thousands of needy families a year, has utility bills that average about $10,000 a month. Police, fire and safety services are essential to keeping the ministry operating, she said.

After looking at all of his monthly utility bills from this year, resident Wayne Henson said the tax isn't going to "break" him. But he added that local businesses may pass on the added cost to customers, which would mean higher prices on goods and services.

Repealing two-thirds of the kilowatt-hour tax will mean a monthly increase for the average residential customer of 3.19 percent, said Mike Perry, executive director of the Hamilton Electric Department.

The tax is needed because the city is heading toward major cuts in 2010 to parks, health, human relations and construction services departments, Brandenburger said.