LIMA — A rare move in the Ohio House of Representatives has, according to area county government representatives, helped local governments dodge a proverbial bullet in the state’s two-year budget bill now signed into law.
On Thursday, the House voted 87-10 to override 11 of 47 line item vetoes placed into the budget by Gov. John Kasich, the first time this has been done in 40 years, according to Ohio Public Radio. In order for those overrides to go into effect, the Ohio Senate must also vote for them. At least 20 votes in favor of these overrides is needed in the Senate for passage.
One of the vetoes overridden by the House included a provision to seek a waiver from the Centers for Medicare and Medicaid Services to increase the franchise fee paid by insurers as a means to mitigate the federally mandated loss of the Medicaid managed care organization sales tax that goes to counties and regional transit authorities.
Kasich had proposed a one-year stipend to temporarily offset the loss to counties, which would have totaled $207 million statewide, according to Allen County Commissioner Jay Begg.
“The governor’s original budget kept the approximately $600 million that the state collects in that tax and eliminated the $207 million that goes to counties and regional transit authorities,” he said. “Our share in Allen County that we would have lost would be approximately $950,000 a year.”
That loss would have represented 6 percent of the county’s total sales tax income, or between 3 percent and 4 percent of the total operating budget. Should the override take effect, those funds would remain in place for six years, according to Begg.
“That was the main situation where our funding was in jeopardy,” Begg said. “That was a pretty big deal. We’re funding so little to non-Ohio Revised Code mandated departments, that $1 million is probably more than we fund to them. So we would have to look at eliminating those or putting less money toward capital when we’re trying to find more money for capital. It was going to be a significant hole to fill.”
The Allen County Regional Transit Authority does not receive any funds from this tax, according to Executive Director Sheila Haney.
For Auglaize County, the veto would have resulted in a loss of $400,000 annually, representing 4.4 percent of the county’s total sales tax income.
“We’re somewhere in the middle,” County Administrator Erica Preston said. “We’re not at the bottom, nor are we at the top of the impact. But it would have been substantial for us.”
While less than 5 percent in lost sales tax income may not sound like much on the surface, the results would have been felt in Auglaize County, according to Preston.
“Our big concern is that our Sheriff’s Office is a large percentage, about 30 percent, of our general revenue fund, and our sales tax makes up almost 60 percent of our revenues,” she said. “Our concern that if we do lose this funding, it would reach into services offered through our Sheriff’s Office. If it does trickle over and we see this reduction, we would have to potentially consider reducing services across the board.”
While potential losses in Putnam County would have only been about $200,000, half those expected in Auglaize, that still would have represented 4.5 percent of the county’s tax revenue, according to County Administrator Jackson Betscher.
While the loss would have had a significant impact, the cut would have continued a trend of the state cutting back on local funding, Betscher said.
“More and more local communities, and I’m including villages, cities, townships and counties, to a large degree, have had to do so much more that was expected by the electorate with less revenue,” he said. “It’s been difficult for us to manage, on the small budget we have now, to do capital improvements, such as on the courthouse or other things.”
Betscher added that this has also led many in county government to take on many additional roles to help maintain peak efficiency with fewer personnel.
“Many of us are an inch deep and a mile wide,” he said. “We wear a lot of different hats.”
No date has yet been set for the Ohio Senate to consider the veto overrides. Vetoes can be overriden through the end of 2018.