Renewal of a half-percent sales tax on the May 6 ballot is critical to the future of Mahoning County government, county officials say.
“That is desperately needed to keep county government running,” said David Ditzler, chairman of the county commissioners.
“Without that, you’d turn into a sequester situation with the county government,” Ditzler said, referring to federal budget cuts, known as the sequester.
“We might as well shut it down because we won’t be able to operate,” Ditzler said during a recent county commissioners’ meeting.
The commissioners are seeking continuous renewal of the tax.
Another county sales tax already is continuous.
“Mahoning County cannot exist on less than this percentage,” Commissioner Carol Rimedio-Righetti told The Vindicator’s editorial board.
The Youngstown/Warren Regional Chamber has endorsed the sales-tax renewal.
Each of these two taxes brings $15.5 million in annual revenue to the county, which has a $50.2 million annual general-fund budget for 2014.
Except for $1,050,000 going into the county’s debt- service fund this year, the sales-tax revenue goes to the general fund, the county’s main operating fund.
It pays for the county’s justice system, including the courts, jail, prosecutor’s and coroner’s offices and 911 dispatching center, board of elections and central administration of county government.
“Justice and public safety, by itself, is $39 million a year,” said Audrey Tillis, county budget director.
“Basically, our whole general fund is about justice; and our 1 percent does not even cover that,” Tillis said.
Other sources of county general-fund revenue include state monies, investment income and real- estate taxes.
The half-percent “is part of the lifeblood of this county, and it’s not something that we can keep going on and off on,” Tillis said, alluding to the county’s financial woes a decade ago when sales taxes were being voted on and off.
Twenty-two of Ohio’s 88 counties have a 1 percent total sales tax for county coffers, but 61 Ohio counties have a higher percentage going to the county’s budget, Righetti said.
Eight Ohio counties, including Mahoning, also have sales taxes for mass transit. Mahoning County has a quarter percent five-year sales tax going to the Western Reserve Transit Authority.
The first 5.75 percent of the sales tax in all counties goes to the state. The state raised its portion of the sales tax from 5.5 to 5.75 percent last Sept. 1, while reducing state income-tax withholding.
If it isn’t renewed, the sales tax on Mahoning County’s May 6 ballot will expire Sept. 30, 2015, Tillis said.
If it fails May 6, the county would have additional opportunities to renew it at the ballot box this November and in May 2015 without any revenue loss, Tillis said.
“I don’t even begin to know where you cut $15 million out of the county’s general fund,” if the renewal fails to pass before the tax expires, Tillis said.
“When there’s no cash and we have to cut services, I sure hope that I’m not going to be very busy processing layoff notices,” said Karen U’Halie, county human resources director.
Tillis has said the county also needs a quarter- percent additional sales tax to compensate for declines in state funding and investment income, but the county commissioners decided in January not to place the proposed additional tax on the May 6 ballot.
Fearing voters would reject both the renewal and the new tax, commissioners said they wanted to concentrate on the renewal.
When comparing 2008 with 2013, the county’s general-fund revenue losses have included $3.2 million in lost investment income, $2.9 million in lost state funding and a $4.4 million loss in revenue from housing federal prisoners in the county jail, Tillis said.
To manage this decline, the county has reduced staff, frozen wages, re-structured debt and depleted reserves, she said.
In a public hearing on the sales-tax renewal, county Auditor Michael V. Sciortino cited a warning from Standard & Poors that a loss of sales-tax revenue could jeopardize the stable financial outlook rating S&P has given the county.
Sciortino and Righetti are seeking re-election this year.