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State budget may pose county threat

Ohio’s recent budget battle will have a negative effect on villages, townships and counties, a statewide watchdog group says.

Sunday, July 08, 2001

Ohio’s recent budget battle will have a negative effect on villages, townships and counties, a statewide watchdog group says.

"There will be a revised certification on local government funds which means a possible dilemma for counties," said Larry Long, executive director of the County Commissioners Association of Ohio.

Long addressed the Lawrence County Commission Thursday, updating commissioners on the state budget’s local impact.

That budget – passed by the legislature in late June – revises the amount of money from state tax sources that goes to villages, municipalties and townships across Ohio, meaning a reduction in local income.

And that local government funding is Lawrence County’s third highest source of income, said Chris Kline, deputy county auditor.

The state listed how much money government entities would receive a year ago, but now has cut the fund and froze amounts at the 2000 level to balance the biennial budget that began July 1, Kline said.

"No one knows what the numbers will be for sure," Kline said, but added that governments receiving state funds will likely face a budget reduction soon. "They’ll start to let us know in the next few weeks."

Meanwhile, counties also should be aware that an Ohio sales tax revenue decrease, an "out of control" Medicaid program and the DeRolph school funding case will have more trickle down effect on local revenues, Long said.

"There’s been a general slowdown in the economy – sales tax is 3 to 7 percent off around the state," he said. "It’s not good news."

More bad news will come from a decrease in how much counties are reimbursed for public defenders and a reduction in juvenile justice items, Long said.

The county might have one saving grace, though. Its sales tax revenue has not followed the state trend, Kline said.

Local sales tax figures look promising so far, which could make up the difference in the state-provided local goverment funds, he said.

Still, the sales tax sometimes acts like a yo-yo, rising and falling month to month, so you never can tell, Kline added.

Statewide, counties have another bright spot to look forward to in budget planning – the current budget has a provision to eliminate county-sponsored funding for educational services centers, Long said.

Right now, the commission must pay for ESC office space and utilities. Beginning July 1, 2002, Lawrence and other counties can start reducing what it pays for such services over a five year period, reducing the strain on general funds, Long said.