STATE LEGISLATURE Panel looks at restoring local funding

Up to $810 million in additional revenue will be available.
COLUMBUS -- Local government advocates are rejoicing at the possibility of reduced or no cuts in state aid to cities, counties, libraries and other local government agencies in the new two-year, $51 billion state budget.
"Any restoration is good news," John Mahoney, deputy director of the Ohio Municipal League, said Thursday.
"Any addition is welcome," said Lynda G. Murray, director of government relations with the Ohio Library Council.
Majority House and Senate Republicans say restoring state dollars to local government funds in the new state spending plan is a priority for up to $810 million that state administrators say is available in additional revenue over the two-year budget period that begins July 1.
Breaking even
Republican Gov. Bob Taft has recommended using some of the new revenue to keep local government funding at current levels -- about $1.2 billion annually.
However, a six-member House-Senate conference committee will probably determine the funding level as well as iron out other differences between versions of the state budget passed by each chamber.
"We heard a great deal of mayors, township trustees, et cetera coming forward and saying this is a priority," House Finance Chairman Charles Calvert, R-Medina, said after the panel met for the first time Thursday.
"My position going into this budget is that during difficult recessionary times, we're a partnership and [if] the state has to take cuts in their programs, local governments should share in that responsibility," said Calvert, who is also chairing the conference committee.
"I think if we've got additional revenue, the opposite holds true," Calvert said.
Minority Democrats in both chambers said the potential restoration of local government funding was a positive step for a spending plan they had said would harm low and middle income Ohioans.
"It is a first step in the right direction," said state Sen. Tom Roberts, a conference committee member. Roberts, D-Dayton, is also the ranking Democrat on the Senate Finance Committee.
Shifting budgets
Local government funding has evolved since legislative consideration of the budget began earlier this year.
Under the version of the state budget the Senate approved last week, state aid to villages and townships would be frozen at current funding levels. Villages and townships were slated for funding cuts under Taft's proposed state spending plan as well as the version of the budget the House passed in April.
The Senate's version of the budget would cut state aid to counties by 10 percent. The governor had proposed a 20 percent state funding cut for counties. The House-passed state budget maintained the 20 percent reduction for counties, but would have cut it in half for counties that file a report with the state on consolidating services.
Cities had been set for a 20 percent trim in state aid, under both the governor's proposed budget as well as the House-passed version. However, the Senate version lowered the reduction to 10 percent on the first $1 million that cities get from the state and maintained a 20 percent reduction on the remaining state-provided funds.
Restoring local government funds to current levels would add about $187 million over the two-year budget period from the Senate-passed appropriations, the Taft administration said.
Slowing recovery
Mahoney said many cities around Ohio are still hurting from a state economy that has been slow to emerge from recession. Additional state funding cuts could take a bite out of local public safety and law enforcement services, Mahoney said.
"Revenues still aren't coming back well at the local level," Mahoney said. "It would be difficult to have these cuts on top of that. It could lead to an erosion of local services."
Taft's other priorities for the additional revenue include rebuilding the state's cash reserves, which stand now at about $180 million, and continued funding of a $10 billion school construction and renovation program.
Other GOP priorities for the additional funds include building up Ohio's cash reserves, directing more money to higher education and reducing the impact of a proposed increase in electricity consumption-related taxes.
Once the conference committee hammers out a report, both legislative chambers have to approve it. The governor has to sign a new balanced state spending plan into law by July 1.

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