|
Dayton
Daily News Editorial…
Forcing local tax
increases not solution
Thursday, March 17, 2011
Talk to local government officials on the day after Gov. John Kasich’s
proposed budget was released, and many of them are taken aback.
They expected to get less from the state’s so-called Local Government
Fund. But some are flabbergasted that the funding would drop by almost
50 percent over the next two years.
Remember that in 2005, when Republican Bob Taft was governor, local
governments went ballistic and beat back an effort to cut this revenue
sharing to cities and counties by 20 percent, and by 10 percent to
townships and villages.
Admittedly, the state’s finances were less dire then.
In raw numbers, total statewide spending for local governments would
fall from $665 million to $326 million in 2013. Combined with the
lesser cut proposed for this year, that would amount to a half-billion
dollars less over two years going for police, fire and trash pick-up —
the big things local governments do.
In Dayton, City Manager Tim Riordan has been getting ready to ask for
an income tax hike. He notes that Dayton’s general fund revenue was
less in 2010 than it was in 1998 (in non-inflation-adjusted dollars).
The city currently gets $11.2 million from the Local Government Fund;
the number could fall to $6.5 million in 2013.
The cuts would be Exhibit A for why the city has to ask for more money
(even though a hike would further disadvantage it against
income-tax-free townships and other jurisdictions that have a lesser
rate).
Gov. Kasich is definitely facing awful choices. He is staring at an $8
billion deficit. But this move also is a strategic decision.
He thinks Ohio’s total taxes are too high, and that local governments
are spending too much and that there are too many of them.
The governor is assuming that big cuts in the Local Government Fund
will force many to reduce spending, share services and consolidate.
But if what happens instead is that local governments — all bazillion
of them — just raise taxes, the state — as a whole — would not be
better off.
Without question, Ohio has too many local governments. But the places
that are going to be hurt the most by these particular cuts are the
“have-not” communities — the big and poor places, and the small and
poor ones. There are some jurisdictions that simply can’t raise local
taxes enough to provide reasonable services because there is so little
wealth to tax.
Trying to make them become more efficient by becoming bigger is hard
when there aren’t other communities that want to be part of a
government that has a high demand for services, but little money.
The Local Government Fund was created because lawmakers understood that
not all communities are created financially equal, that pooling money
at the state level, and then redistributing it, help assure that all
citizens have certain basic services.
Gov. Kasich doesn’t seem to appreciate that thinking. Yet when cities
that benefit from wealthy estates — Oakwood, Kettering, Washington
Twp., Centerville and others — complained that eliminating the state
estate tax would strip them of precious money, the governor heard them.
He slowed that train down.
Why ease the pressure, say, on tiny Oakwood that doesn’t have to be its
own city, but hammer the small, poor communities with Local Government
Fund cuts?
Why take the pressure off Washington Twp. and Centerville to merge by
letting them keep their estate tax proceeds, but put Dayton in the
position of having to decimate its services or raise taxes?
In short, if a reduction in government is the goal, why apply the
pressure unevenly?
The governor hasn’t reconciled all his messages, and he hasn’t
confronted the unintended consequences of his ideas.
This is just the first step in the budgeting process.
When legislative hearings start, just objecting to cuts won’t do. But
objections to real inequities do have to be made — and heard.
Read it at the Dayton Daily News
|
|
|
|
