OHIO Counties fret over tax, fund proposal

The full Senate will take up the GOP proposal today.
COLUMBUS -- Advocates for Ohio's counties, concerned about the potential double-whammy of decreased state money for local governments and a two-day sales-tax holiday, are bracing for bad news.
Provisions in a plan offered by Senate Republicans to close a projected $1.5 billion shortfall in Ohio's two-year, $45 billion state budget would cut local government funds by 6 percent annually.
Also, the Senate GOP plan would keep a proposed sales-tax holiday first proposed by the House, tentatively set for two days in March. That's a possibility that could affect counties that also levy sales taxes.
County advocates were still trying to determine Wednesday what the local government fund cut would mean.
"We don't know what the mechanics of that are," said John R. Leutz, a lobbyist for the County Commissioners Association of Ohio.
Government funds: But Leutz said that local government funds are a major piece of the budgets for counties and other local governments such as municipalities and libraries.
Republican senators said the cut would mean reductions in the three local government funds of about $79.5 million in the current budget year that ends June 30 and $79.8 million in the next if the GOP proposal is passed by the full Senate today.
The Senate Finance and Financial Institutions Committee approved the budget correction package Wednesday.
In the current state budget, the local government funds had been frozen in the first year of the budget from the previous year.
"They're taking money that was pledged to us," Leutz said. "That's frustrating to us." Public libraries also will take the 6 percent hit.
Nearly 80 percent of the public libraries in the state depend solely on the local government funds for their money, said Lynda Murray, interim director of the Ohio Library Council, which represents about 250 public library systems in the state.
"You'll start to see cuts in materials purchase, so you'll have to wait longer to get best sellers. I think you'll see it in service, shorter hours, fewer employees," Murray said.
The cut could force those public library systems that depend on local government funds to seek local tax increases for funding, she added.
Tax holiday: County governments are also concerned about the proposed sales-tax holiday.
The proposed tax holiday, originally called for in the budget-fix crafted by House Republicans, would be set for two days in March and would exempt the sales tax from purchases of clothing and footwear.
The state sales tax is 5 percent. Counties and transit authorities can levy an additional tax on top of that up to 1.5 percent in quarter-percent increments, state officials said.
Legislative researchers say the government would forgo $27 million in revenues with a two-day, sales-tax holiday.
If a sales-tax holiday is put into place, county advocates say they would like county sales taxes to be exempt.
Sen. Jim Carnes, R-St. Clairsville, Senate finance committee chairman, said he didn't expect the counties' request to make it into the Senate Republican plan.

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