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Sep 20 2013

Reductions in local government funding leading to deep cuts in communities

statehouseIn the last three years state lawmakers made deep cuts to local communities to the tune of almost $2 billion by slashing the Local Government Fund and eliminating the estate tax . For years these funds went back to local governments and helped them fund all types of services ranging from road maintenance, hiring police and fire officials, to parks and recreation programs. A recent survey released by the Ohio Municipal League (OML) paints a stark picture of what cuts to these local government funds look like on the ground. The OML sent emails to over 1,300 employees at 249 cities and villages across the state with links to the survey.  The survey was comprised of 12 questions, 8 of which pertained to the municipality’s finances and recent budget decisions. Findings from the survey show that local governments of all sizes saw their bottom lines take a hit in recent years. Across all communities, the average general fund reduction was 5.08 percent. The communities with the smallest budgets took the largest hit to their operating budgets. There, local governments reported general funds reductions of 15 percent on average. When asked specifically what cuts local governments made because of funding cuts the answers are telling. The survey found that in response to cuts nearly 70 percent of municipalities reduced capital expenditures, 50 percent reduced service levels, and 40 percent raised fees. What this means is that when the state cut funding, local governments responded by pulling back on investments thereby kicking the can down the road for making needed improvements in their communities. [Read more…]

Written by bpeyton · Categorized: Innovation Station · Tagged: Budget Cuts, Local Government

Mar 14 2013

State budget limits local authority, revenue options with sales tax changes

stark-feat Included in the Governor’s sales tax proposal are dramatic changes to how counties are able to levy vital local sales taxes. These changes significantly reduce county sales tax rates, lock in cuts for three years, and lower the maximum amount that can be levied in the future. Administration officials have stated that the reduction in county sales tax rates is necessary to prevent counties from collecting a “windfall” of new sales tax revenue due to the expansion of the sales tax base to services. While the state tax is reduced by 9 percent, county sales tax rates are reduced by 10 to 40 percent. See our table of county sales tax rates and proposed reductions. These reductions are based on how much each county with the goal of each county seeing at least 10 percent revenue growth in the first year. The state will make up the difference if the new rates fall short. In 2015 and 2016, rates will be adjusted to approximate the 10-15 percent growth the Kasich administration thinks is appropriate, but because the adjustments are based on prior year tax collections it creates a ceiling on revenue growth for counties and transit agencies, despite what’s happening in the local economy. [Read more…]

Written by bpeyton · Categorized: Ohio State Budget, Taxation · Tagged: Local Government, Ohio Budget, Sales Tax

Oct 22 2012

Kasich cuts to local govs also spur levies this fall

We’ve been working to highlight how the Kasich Administration’s $1.8 billion in Ohio public education cuts have lead many school districts around the state to the November ballot seeking new or additional local tax dollars. The same thing is happening for some local governments in Ohio as well. [Read more…]

Written by emilymcbane · Categorized: Ohio State Budget, Taxation · Tagged: John Kasich, Local Government, Ohio Budget Cuts

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