PATA History Pages

Ohio Poised to cut funding from Cities and Townships

Rumor Mill projects Big CUTS

For weeks now the Violet Township Trustees and Staff have been foreshadowing possible big cuts in state provided local funding, which is a big chunk of the Township budget. It appears that Cites will not escape the ax either. With Medicaid costs skyrocketing, and consuming larger portions of the State budget each year, the state is projecting a 5 BILLION dollar budget shortfall....yes BILLION! Looks like there will be more than one "Taxachussetts" in the USA when the ax drops in the very near future, as local residents will surely be asked to carry the load to continue the current levels of basic services. Fairfield County is just ahead of the ball on the ballot February 8th with a sales tax increase, PATA projects....more to come....

From the Columbus Dispatch

That could really hurt
If Ohio cuts funding to cities, Columbus and its suburbs might have to trim basic services
Sunday, January 23, 2005
Dean Narciso and Kirk D . Richards
THE COLUMBUS DISPATCH

CHRIS RUSSELL | DISPATCH
Mike Schulze, a mechanic for the city of Reynoldsburg, makes sure that one of the city’s snow trucks is ready to go. Jobs such as his might be jeopardized if the state cuts money it supplies to local governments.

With up to 15 percent of their funding in jeopardy, Columbus and its suburbs are preparing for the worst as they fight to avoid it.
State budget experts are looking for things to cut, and one option is the money that goes to local communities.

For Reynoldsburg, that accounts for more than 14 percent of its general-fund budget. In Bexley, it’s almost 12 percent. And in Upper Arlington and Columbus, almost 9 percent.

"It’s going to have an impact like no other we’ve seen," said Columbus City Council President Matt Habash.

"There’s no doubt that cuts will be felt in police and fire departments," added Councilwoman Maryellen O’Shaughnessy.

The cuts in local-government funding could range from nothing to everything.

Gov. Bob Taft is not expected to announce his 2005 budget proposal until after his State of the State address on Feb. 8.

Municipalities are worried about deep cuts because the state is facing a $6 billion deficit and dealing with challenges from school and health-care reform.

"We hear from them every day," said an official at the Ohio Office of Budget and Management, who didn’t want to be identified because of "the sensitivity of the budget process."

"It’s become more intense."

Some local leaders are developing contingency plans.

Grove City Finance Director Bob Behlen has already prepared a plan for cutting his city’s budget.

Protecting the police department would be the top priority. Street maintenance would most likely suffer. Potholes could last longer and be filled with gravel as a short-term fix.

"A lot of money is in gardening and landscaping," Behlen said, noting that those jobs are labor-intensive. "Something’s got to give."

The state distributes about $778.4 million a year to local governments. The money is drawn primarily from state income-tax revenues and is used for basic services.

Cities, operating on a calendar year, already have approved their budgets for 2005 and would not feel the pinch until after July 1; the state operates on a midyear budget.

"The following year would be very tough," said Gahanna Finance Director Jerry Isler, whose city relies on state funding for about 8 percent of its budget. "Residents have come to expect a certain level of services. . . . What services do you cut?"

Reynoldsburg Mayor Bob McPherson says state officials shouldn’t be looking at local funds when there is "so much waste" in the state budget.

"I think they’re trying scare tactics," McPherson said. "They need to suck it up and think of some of the alternatives."

Reynoldsburg would need to create almost 4,500 new jobs to generate enough tax revenue to replace the state money if it all were cut, according to projections from the Miami Valley Regional Planning Commission.

Susan J. Cave, director of the Ohio Municipal League, told the General Assembly in a letter last summer that a loss of that money would lead to "either huge tax increases or devastating service cuts for many of our communities."

In the past four years, local governments have lost an estimated $345 million in state funds as a result of cuts and freezes, said John Mahoney, assistant director of the Ohio Municipal League.

Mahoney is one of many advocates discussing the issue with state lawmakers.

"They understand that this helps us keep the quality of life back home and not have those local problems with everyday services percolating back onto the Statehouse steps," he said.

In Hilliard, local-government funding makes up more than 7 percent of the city’s current $14.7 million general fund budget; $10 million goes to personnel.

So if the entire amount were cut, "It’s going to have to come on the backs of employees, meaning fewer employees," said Hilliard Finance Director Michelle Kelly-Underwood.

Same goes for Grandview Heights, said Council President Anthony Panzera.

His suburb already is seeking alternate sources of revenue to make up for the loss of Big Bear, which had been a large contributor to Grandview.

"We’re down to the core basics in order to function as a charter city," Panzera said. "We’re definitely talking essential services — police, fire, streets."

As part of the lobbying effort, some city councils — including Grandview’s — are looking to draft statements urging Ohio lawmakers to retain the funds.

The Worthington City Council plans to pass a resolution next week.

"There’s no way that municipalities are capable of providing the quality of life that Ohioans are used to with these cuts," said Worthington Councilwoman Bonnie Michael.

Although Upper Arlington would be in good shape initially because of its reserves, Finance Director Cathe Armstrong said her city would face long-term consequences.

"This is a revenue stream that is embedded in our funding stream for basic services," Armstrong said. "We have heard that this is a real threat."

The Taft administration says all expenditures will be reviewed, including the local-government funding. "It’s important," said David Brunson, deputy director of the Office of Budget and Management. "But the rest of state government is important, too." Dispatch reporter Jim Woods contributed to this story.

dnarciso@dispatch.com


krichards@dispatch.com

Cities Brace for BIG STATE AID CUTS

The Columbus Dispatch