State Sen. Tim Schaffer (R-Lancaster) is introducing legislation Thursday that would attach mandatory drug testing to welfare benefits, even though similar policies have proven to be costly with little gain in other states.
“It is time that we recognize that many families are trying to survive in drug-induced poverty, and we have an obligation to make sure taxpayer money is not being used to support drug dealers,” Schaffer told The Columbus Dispatch. “We can no longer turn a blind eye to this problem.”
Under the proposal, welfare recipients in three counties would be required to take a drug test if they admit in a questionnaire to using drugs in the past six months. Children, who make up a bulk of welfare recipients, would be exempt. (In June, 24,443 adults and 105,822 children obtained welfare benefits in Ohio, according to data from the Ohio Department of Job and Family Services.)
The policy, which was originally touted as a way to reduce welfare costs, has backfired in many states. That’s why the supporting line is now about preventing dollars from going to drug dealers instead of cost savings.
Deseret News reports the latest problems in Utah: “Utah has spent more than $30,000 to screen welfare applicants for drug use since a new law went into effect a year ago, but only 12 people have tested positive, state figures show.”
When Ohio legislators in 2012 proposed a drug testing requirement for welfare benefits, CityBeat reported another failure in Florida originally covered by The Miami Herald: In that state, the program had a net loss of $45,780 after it reimbursed falsely accused welfare recipients for their drug tests. Only 108 people out of the 4,086 accused, or 2.9 percent, tested positive, and most tested positive for marijuana.
Utah and Florida are among eight states that have enacted drug testing requirements for welfare recipients since 2011, according to the National Conference of State Legislatures.
A court placed an injunction on the Florida program after the American Civil Liberties Union sued on September 2011. That injunction was upheld on Feb. 26 by the Eleventh Circuit Court of Appeals in Atlanta, which concluded, “The simple fact of seeking public assistance does not deprive a TANF (welfare) applicant of the same constitutional protection from unreasonable searches that all other citizens enjoy.”
Given that Schaffer’s bill would require drug testing only after information is solicited through questionnaires, it’s unclear whether legal challenges like the one in Florida would be successful in Ohio.
In the first of three debates for Ohio’s seat in the U.S.
Senate, Democratic incumbent Sherrod Brown and Republican challenger Josh
Mandel agreed on little and clashed on a lot. Each candidate mostly focused on the opposing candidate's record, but the debate today did move to substantial differences in policy at some
The debate started with opening statements from a noticeably feisty Brown, who criticized Mandel for calling his vote for the auto bailout “un-American.” On the other side of the aisle, Mandel began his opening statement with a joke about shaving before he turns 36. The joke was the last time either of the men spoke with a light heart.
The candidates blasted each other mostly for their records. Mandel touted Ohio's and the nation’s higher unemployment rate since Brown took office in 2006, energy prices and the U.S. debt. He also said the Senate had not passed a budget in three years, although Congress has actually passed budget resolutions in that time.
Brown fired back with claims Mandel had filled the state treasurer’s office with cronies. He also criticized Mandel for running for four different political offices in seven years. In his closing statement, Brown said Mandel is “too concerned about running for his next job” to be trusted.
On substance, Brown and Mandel criticized just about everything about each other. Brown claimed Mandel signed away his “right to think” by agreeing to lobbyist Grover Norquist’s pledge to not raise taxes while in office. He said the pledge makes it so if Mandel does take office, he’ll never be able to close tax loopholes for big corporations.
Mandel defended the pledge by saying, “I’m proud to stand
for lower taxes in our state and lower taxes in our country.” He added, “I will
do everything I can to advocate for lower taxes across the board for the middle
class and job creators as well.”
The term “job creators” is typically used in politics to reference wealthy Americans, who Republicans claim create jobs through the theory of trickle-down economics. The economic theory states that wealthy Americans will hire more lower-class Americans if they have more money and freedom, essentially creating a trickle-down effect on wealth from the rich to the poor. Although Republicans still tout the theory, some economists, including Nobel Prize winner Paul Krugman, say the financial crisis of 2008 and the deregulation that led to it prove trickle-down economics do not work.
The candidates also debated their positions on the auto bailout. Mandel said he would not have voted for the auto bailout if he was in the Senate in 2009. In his defense, he cited the experience of Delphi workers, who lost part of their pensions as part of the deal auto companies made with workers after the federal bailout. Mandel then said, “I’m not a bailout senator. He’s the bailout senator.”
Brown responded by saying, “These are real jobs and real people.” He then cited examples of people helped by the growing auto industry. Brown’s arguments are backed by economic data, which has repeatedly credited the growing auto industry for the nation’s growing economy. In the first quarter of 2012, the auto industry was credited for half of the nation’s economic growth.
When he was asked about higher education, Brown established the key difference between the candidates in terms of economic policy. Brown said his policies in favor of government investment in higher education are about supporting the middle class to create growth that starts in the middle and spreads out, while Mandel supports tax cuts that emphasize a trickle-down approach. Mandel did not deny the claims, and instead blamed Brown’s policies for the high unemployment rate and debt issues.
The men continued to show similar contrasts on the budget, taxes and economy throughout the entire debate, but there seemed to be some common ground regarding energy independence. When the topic came to hydraulic fracturing — or “fracking” — Brown said becoming energy independent would have to involve all possible energy sources. In substance, Mandel agreed, although he also praised fracking regulations recently passed by the Ohio legislature and Gov. John Kasich.
As far as energy issues go, the agreement stopped there. When Brown was asked about President Barack Obama's alleged “war on coal,” Brown said there was no war on coal and claimed there are more coal jobs and coal produced in Ohio than there were five years ago. Mandel disagreed and claimed there is a war on coal. He added if Obama is the general in the war on coal, Brown is Obama's “lieutenant.” Brown previously supported federal regulations on mercury that some in the coal industry, including the Ohio Coal Association, claim will force coal-fired power plants to shut down. The regulations go into effect in 2015.
On abortion, Mandel proudly claimed he was pro-life, while Brown said, “Unlike Josh Mandel, I trust Ohio women to make their own health care decisions.” Brown also criticized Mandel for not establishing exceptions for rape, incest and the health of the mother in his anti-abortion stance.
Many more issues, from term limits to Middle Eastern culture, were covered in the debate. The candidates drew sharp contrasts in all these areas with Brown typically holding the liberal position and Mandel typically holding the conservative position. But despite the feisty language and deep policy contrasts, when the debate ended, the candidates smiled, shook hands and patted each other on the back. They will meet again in Columbus on Thursday and Cincinnati on Oct. 25.
JobsOhio and other privatized development agencies have created scandals and potential conflicts of interests instead of jobs, claims an Oct. 23 report from Good Jobs First, a research center founded in 1998 that scrutinizes deals between businesses and governments.
The report looked at privatized development agencies in seven states, including Ohio, and found that many of the same problems and scandals appear from state to state.
“These experiments in privatization have, by and large, become costly failures,” the report found. “Privatized development corporations have issued grossly exaggerated job-creation claims. They have created ‘pay to play’ appearances of insider dealing and conflicts of interest. They have paid executives larger salaries than governors. They have resisted basic oversight.”
The report focuses much of its findings on JobsOhio, a privatized development agency that Gov. John Kasich and Republican legislators established in 2011 to replace the Ohio Department of Development. The agency uses tax subsidies and other financial incentives to attract companies to Ohio with the intention of creating jobs.
But the report states JobsOhio “assembled a board of directors whose members included some of (Kasich’s) major campaign contributors and executives from companies that were recipients of large state development subsidies. It received a large transfer of state monies about which the legislature was not informed, intermingled public and private monies, refused to name its private donors, and then won legal exemption (advocated by Gov. Kasich) from review of its finances by the state auditor.”
It found similar issues in privatized development agencies in Wisconsin, Arizona, Indiana, Florida, Rhode Island and Michigan. In some cases, the scandals have cost states millions of dollars with little job creation to show for it, according to the report.
The latest report concurred many of the findings in a similar 2011 report from Good Jobs First, which sought to warn states, including Ohio, about the potential risks of privatized development agencies.
For JobsOhio, a major cause for concern in the report is how difficult it is to hold the agency accountable. State legislators have approved multiple measures that shield JobsOhio from public scrutiny, including exemptions that exclude the agency from public records laws, open meeting rules and the possibility of a full public audit.
Some of the controversy also focuses on how the state funds JobsOhio.
“The proposal called for ‘leasing’ the state liquor profits ($228 million the year prior) for up to 25 years to JobsOhio, which would eventually issue $1.4 billion in bonds to pay for the use of the funds,” according to the report. “Critics charged that this was not a fair market price for profits that could potentially amount to $6 billion over the term of the agreement.”
The report laments that the privatized and secretive agency represents a shift for Ohio, which the report claims “was an early practitioner of online subsidy disclosure.”
Good Jobs First concludes privatized development agencies perpetuate an economic environment in which big companies already have too much say.
“The privatization structures we describe here, including the increasing use of corporate seats for sale on governing or advisory boards, absolutely favor large businesses that have the money and executive staff time to pay and play at such levels,” the report concluded. “But small businesses already get short shrift in economic development resource allocation, and they are still suffering the most in the Great Recession’s aftermath.”
The organization also takes issue with the idea that public agencies aren’t “nimble”: “In all of our years tracking development deals, we have yet to hear of a state agency that lost an important deal because it failed to provide labor market or real estate or incentive data in a timely manner.”
Asked about the report, Kasich spokesperson Rob Nichols responded in an email, “We don't pay much attention to politically-motivated opponents whose mission is to combat job creation.”
Kasich and other Republicans claim JobsOhio’s privatized, secretive nature is necessary to secure job-creating development deals with private companies in an economic environment that, through the Internet and globalization, moves more quickly than ever before.
Democrats, including gubernatorial candidate Ed FitzGerald, claim the agency is ripe for abuse, difficult to hold accountable and unclear in its results.
State Auditor Dave Yost plans to release an audit of JobsOhio soon, but no specific date or time frame is set for the release. The audit was granted prior to state legislation that barred the state auditor from doing a full sweep of JobsOhio’s financial details.
The full report:
Just two days before the general election, President Barack Obama made his case to 13,500 people packed into the University of Cincinnati’s Fifth Third Arena and 2,000 in an overflow room.
Obama cast the race in comparisons to the previous two presidents, comparing his policies with those of Bill Clinton and equating Republican challenger Mitt Romney’s plans with those of George W. Bush.
“So stay with me then,” Obama said. “We’ve got ideas that work, and we’ve got ideas that don’t work, so the choice should be pretty clear.”
With less than 48 hours before polls open on Election Day, a Reuters/Ipsos daily tracking poll had Obama and his Republican challenger locked in a statistical dead heat. However the same poll showed Obama with a slight edge in Ohio, up 48 percent to Romney’s 44 percent.
Obama touted his first-term accomplishments, including ending the war in Iraq; ending Don’t Ask Don’t Tell, the policy preventing homosexuals from serving openly in the military; and overhauling the country’s health care system.
“It’s not just about policy, it’s about trust. Who do you trust?” the president asked, flanked by a sea of supporters waving blue “Forward” signs.
“Look, Ohio, you know me by now. You may not agree with every decision I’ve made, Michelle doesn’t always agree with me. You may be frustrated with the pace of change … but I say what I mean and I mean what I say.”
Nonpartisan political fact-checker PolitiFact on Nov. 3 took a look at Obama’s record on keeping his campaign promises from 2008. The group rated 38 percent as Kept, 16 percent Compromised and 17 percent Broken.
Twice during his speech the president was interrupted by audience members shouting from the stands.
The first was a man on the balcony level of the arena interrupted, shouting anti-abortion slogans and waving a sign showing mutilated fetuses before being dragged out by about five law enforcement officers. Both were drowned out by supporters.
Music legend Stevie Wonder opened the rally for Obama, playing a number of his hits, opening up “Superstition” with a refrain of “on the right track, can’t go back.”
Wonder discussed abortion policy between songs and urged Ohioans who had not already voted to do so either early on Monday or Election Day.
So far, 28 percent of Ohio voters have already cast their ballots. CNN reports that those votes favor Obama 63/35, according to public polling.
Meanwhile on Sunday, Romney campaigned before an estimated crowd of 25,000 in Pennsylvania, according to the Secret Service.
Political rallies always draw a number of the loyal opposition, and this late-evening appearance was no different. Only five people protested near the line to the arena, but what they lacked in number they attempted to make up for in message.
One large sign read “Obama: 666” and another “Obama is the Beast,” alluding to a character in the Christian Biblical book of Revelation.
A man who only identified himself as Brooks carried a large anti-abortion sign that showed pieces of a dismembered fetus.
“I’m here to stand up for the innocent blood that has been shed in this land to the tune of 56 million,” Brooks said. He said he was opposed to the politics of both major party presidential candidates.
“I pray for Barack Obama because his beliefs are of the Antichrist, just like Romney,” Brooks said.
Brooks said his message for those in line was for them to vote for Jesus — not on the ballot, but through their actions and through candidates that espoused Christian beliefs.
“Obama is not going to change things, Romney is not going to change things,” Brooks said. “In the last days there are many Christs, but not the Christ of the Bible. The Christ of the Bible is not for killing children, is not for homosexual marriage.”
Ohio’s inspector general released a report today criticizing the Ohio Department of Job and Family Services (ODJFS) for improperly reimbursing federal stimulus funds to hired organizations that did not follow rules.
In a statement, Inspector General Randall Meyer’s office said ODJFS “failed to adequately oversee federal grant funds applied to the Constructing Futures jobs training initiative for Central Ohio.”
The report released by Meyer’s office today, which focused on stimulus programs in central Ohio, outlined a few instances of ODJFS failing to oversee proper standards. In total, the department, which was put in charge of carrying out job training funds in Ohio from the stimulus package President Barack Obama signed into law in 2009, wrongly reimbursed companies it hired for $51,700.81.
In central Ohio, ODJFS hired two organizations to carry out the job training program, or Workforce Investment Act: Associated Builders and Contractors, Inc. (ABC) and Construction Trades Networks (CTN). At ABC, the inspector general found limited problems with faulty reimbursements involving a newspaper subscription, travel and mileage totaling less than $100. The money was not accounted for as a questionable cost since it was so small.
However, at CTN, the faulty reimbursements piled up. The organization was reimbursed $560.61 for phone calls made prior to being hired as part of the federal grant. It was also reimbursed $1,613.62 for its invoices, even though documentation was not provided to link phone calls as necessary to the grant program.
Under the federal stimulus rules, CTN was required to provide 25 percent of its own funds for the program. CTN planned on using $91,800 of in-kind funds — payment that isn’t cash — by paying for trainee wages. The organization paid $60,927.70 by the end of the grant period, and the organization was reimbursed for $49,526.64 by ODJFS, even though the charges were supposed to be carried by CTN. The inspector general requested CTN give the money back to ODJFS.
When the inspector general contacted the organization to explain the findings, CTN attributed the requests for faulty reimbursements to confusion caused by multiple administrative changes at ODJFS.
“In addition, monitoring visits by ODJFS were not conducted until after the grant period expired, even though the partnerships were told the visits would occur as grant activities were underway,” the report said.
Meyer’s office concluded ODJFS should review the questioned costs, work to keep consistent guidelines through administrative changes and monitor grant funds during the grant period.
The full inspector general report can be found here.
A report was released for northwestern Ohio was released on May 10, and it also found wrongdoing. It can be found here. A report for stimulus programs in southwestern Ohio will be released later.ODJFS could not be immediately provide comment on the report. This story will be updated if comments become available.
UPDATE (3:28 P.M.): Benjamin Johnson, spokesperson for ODJFS, provided a comment shortly after this story was published.
“As the report mentions, these were expenditures by local entities, not by the Ohio Department of Jobs and Family Services,” he says. “We appreciate the inspector general bringing this to our attention, and we'll work to resolve the matter.”
The company that would operate Cincinnati’s parking meters
if the city passes its controversial parking plan this week was mired with audited problems and
complaints in the past. The issues surfaced years before Affiliated
Computer Services (ACS) was bought by Xerox in 2010, and Xerox now denies any wrongdoing.
A 2007 audit found ACS had failed to take care and keep track of parking meters it operated in Washington, D.C. The audit claimed 35 percent of parking meters listed in ACS’s inventory were missing, about 16 percent of the remaining meters were completely inoperative and 65 percent had problems that ranged from defacing to improper height and stability. ACS also failed to fix meters within the 72-hour period mandated by its contract, according to the audit.
For some residents, the broken meters led to unfair
tickets, with 6,888 tickets, or nearly 1 percent of parking meter
tickets, being improperly issued at unfixed meters, according to the audit. The audit also found a 903-percent increase in overall parking meter complaints under the privatization contract with ACS.
The audit also questioned the financial gains for Washington, D.C., which had to pay $8.8 million, or 33.4
percent, more under privatization than projected trends under public
The bad audit wasn’t enough for Washington,
D.C., to cut its contract with ACS, which still manages the city’s
parking meters today.
The audit was among a few other problems tipped to multiple media outlets by Tabitha Woodruff, an advocate at Ohio Public Interest Research Group. In 2007, ACS was accused of bribing police officers in Edmonton, Canada, but a judge ruled in favor of ACS, stating there wasn’t sufficient evidence. In 2010, the Securities Exchange Commission (SEC) charged ACS with backdating and falsely disclosing stock options between 1996 and 2005, and ACS consented to a permanent injunction without admitting or denying the charges.
All the discovered problems occurred before 2010, when Xerox bought ACS.
Kevin Lightfoot, a spokesperson at Xerox, says the audit’s findings were based on “faulty information.” He says Xerox and the District of Columbia Department of Transportation found ACS had saved Washington, D.C., money. He also claims the auditor had misunderstood the parking meters’ screen displays, which he says led to the improper identification of inoperative or malfunctioning meters.
CityBeat previously covered the parking proposal, which would lease the city’s parking assets to fund deficit reduction and economic development, in detail. Mayor Mark Mallory and Vice Mayor Roxanne Qualls have endorsed the plan, and it’s currently expected to have the five votes necessary to pass a possible City Council vote today.
On Friday, Councilman Chris Seelbach revealed Plan S, an alternative proposal that would not lease the city’s parking assets and would instead use $7.5 million in casino revenue, cut $5 million based on the results of the city's priority-driven budgeting and allow voters to choose between a $10-per-month trash fee or a 2-percent increase in the city's admissions tax.
City Manager Milton Dohoney Jr. also put forward
his “Plan B,” which would lay off 344 employees, eliminate Human
Services Funding and close pools and recreation centers, among other
changes. In response, mayoral candidate John Cranley proposed his own
plan, which would use casino revenue, parking meter revenue and cuts to
“non-essential programs” to tame the deficit.
Plan B, Plan S and Cranley’s plan all fix the structural deficit in the city’s budget, while the parking plan only fixes the deficit for two years.
A Dec. 5 report is encouraging Cincinnati to become the solar energy capital of Ohio and the broader region. The report, titled “Building a Solar Cincinnati,” was put together by Environment Ohio to show the benefits and potential of Cincinnati regarding solar power.
Christian Adams, who wrote the report along with Julian Boggs, says Cincinnati is especially poised to take charge in this renewable energy front, in contrast to the rest of the state, which gets 82 percent of its electricity from coal. Adams points to the sustainability-minded city officials and public, a “budding solar business sector” and the great business environment as the city as reasons why Cincinnati could become a pivotal leader.
With 21 public solar installations to date, the city has already seen some of the benefits of solar power. The most obvious benefit is cleaner air, which leads to better overall health and helps combat global warming. But the report points out that local solar initiatives mean local jobs. “You can’t export these jobs,” Adams says. “It’s a great opportunity for economic revitalization.”
With solar energy comes an array of job opportunities for solar installers, solar designers, engineers, construction workers, project managers, sales associates and marketing consultants. That’s enough to create brisk job creation. The report points out “energy-related segments of the clean economy added jobs at a torrid pace over the last few years, bucking trends of the Great Recession.”
Still, there are hurdles.
Although solar energy saves money in the long term, installing solar
panels has a high upfront cost. The cost can make the short term too bleak for many potential customers.
To help overcome the short-term problem, the report suggests third-party financing. In these financing agreements, customers agree to give up roof space to have a solar power company install solar panels, and then customers agree to buy their power needs from the company. It’s a win for the solar power company because the panels eventually pay for themselves through new customers, and it’s a win for the customer because he sees more stable, lower energy costs and cleaner air. Adams points out that a few businesses and individuals in the area have already taken part in such agreements with great success.
There are also some incentives already in place to encourage solar energy. Ohio’s Clean Energy Law, which was passed in 2008, pushes utility companies into the renewable energy market with Solar Renewable Energy Credits. These are credits utility companies must earn to meet annual benchmarks by installing solar panels or purchasing them from third parties. Duke Energy has followed the law’s requirements by establishing its own renewable energy credit program.
Ohioans also have access to some tax breaks — the Energy Conversion Facilities Sales Tax Exemption, Air-Quality Improvement Tax Incentives and Qualified Energy Property Tax Exemptions — and loan programs — the Energy Loan Fund and Advanced Energy Fund — that encourage solar and other renewable energy sources.
Larry Falkin, director of the city’s Office of Environmental Quality (OEQ), says the report didn’t have much new information, but he’s glad it can be used to push solar energy to the broader public. He touted the benefits of job creation and reducing reliance on foreign energy sources by moving toward energy independence.
For now, the city is mostly taking the approach of leading by example. Falkin says the city is acting like a “model” for solar energy. Cincinnati added solar installations to two city facilities this year, and another will be added by the end of the month. Falkin’s office is also working together with different organizations to keep any momentum going.
Adams and Falkin both attended a Dec. 5 roundtable discussion
that engaged regional officials, including solar businesses,
environmental and sustainability groups, education leaders and the
Cincinnati Zoo. They both said the roundtable went well.
“I think all the right people are coming together and doing the right things to try to move us forward,” Falkin says.
A new Policy Matters Ohio report found local government funding has been reduced by $1.4 billion since Gov. John Kasich took office, leading to a nearly 50-percent reduction in state funding.
The report found local government funding dropped from nearly $3 billion in the 2010 and 2011 fiscal years — the years budgeted by former Gov. Ted Strickland — to about $2.2 billion in the 2012 and 2013 fiscal years — the first two years budgeted by Kasich. The governor’s most recent budget proposal would ensure the continuation of the downward slide, with local government funding dropping down to slightly more than $1.5 billion in the 2014 and 2015 fiscal years, according to the report.
Policy Matters concluded new revenue from the state’s
casinos and an expanded sales tax would not be enough to outweigh cuts
in the Local Government Fund, utility tax reimbursements, tangible
personal property reimbursements and the termination of the estate tax. By itself, the estate tax, which was phased out at the beginning of 2013, would have provided $625.3 million to local governments in the 2014-2015 budget, but it was repealed
in 2011 by the Republican-controlled Ohio legislature and Kasich.
The governor’s office has repeatedly argued that the cuts in Kasich’s first budget were necessary to help balance an $8 billion budget deficit, but the Policy Matters report says improving economic conditions have removed a need for further local government funding cuts: “To encourage growth we need good schools, reliable public safety and emergency services and strong communities. During hard times, state and local policy led to cuts. But further cuts in appropriations for local government are not helping communities. Curtailing local control of local revenues will complicate recovery – as the economy improves, it is time to restore the fiscal partnership between state and community.”
When presenting his 2013 budget proposal, City Manager Milton Dohoney Jr. said the state funding reductions cost Cincinnati $22.2 million in revenues for the year.
CityBeat previously covered Kasich’s 2014-2015 budget proposal and how it affects taxpayers, schools and Medicaid recipients (“Smoke and Mirrors,” issue of Feb. 20).
Hamilton County fares worse
than Ohio overall in a series of measurements for children’s
economic well-being, health, education and safety, according to a report released Aug. 7.
The 2013 “Ohio’s Kids Count” report from the Children’s Defense Fund and Annie E. Casey Foundation finds Hamilton County has a higher median income than Ohio does on average. But the county fares worse than the state in various categories, including childhood poverty, fourth-grade reading and math proficiency, felony convictions and the amount of babies with low birth weights, an early sign of poor health.
One example: Hamilton County’s childhood poverty rate is 27.7 percent, while Ohio’s overall rate is 23.9 percent. If the county brought the rate down to the state average, it would pull more than 3,000 local children out of poverty.
Hamilton County’s childhood poverty rate dropped from 28.5 percent to 27.7 percent between 2010 and 2011.
The report uses state data from between 2009 and 2011 to look at various indicators for children under the age of 18. Some of the data differs from findings from other groups, such as the National Center for Children in Poverty, which found about 48 percent of Cincinnati’s children are in poverty.
The report claims many of the measured indicators are socially and economically linked, so it should come as little surprise that Hamilton County is doing worse across the board. Still, it advises local, state and federal officials to continue taking action to bring down the troubling numbers.
In Cincinnati, City Hall has historically failed to meet its goals for human services funding, which in part helps homeless youth and other struggling children.
But local leaders, including city officials and business executives, have backed the Cincinnati Preschool Promise, which aims to place more low- and middle-income Cincinnati children in early education programs. Shiloh Turner, vice president for community investment at the Greater Cincinnati Foundation, today wrote in an email to CityBeat that Preschool Promise backers are currently looking at funding options and will iron out plans and partnerships through meetings scheduled for the next three months.
The Kids Count report credits Ohio officials in particular for approving a new voucher program that will subsidize preschool for families at or below 200 percent of the federal poverty level. The program is expected to reach 7,000 children in the state over the next two years.
But the state has generally cut education funding since Gov. John Kasich took office, leaving Cincinnati Public Schools with $15 million less state funding than it received in 2009.
At the same time, the federal government is set to cut its food stamp program in November, which progressive think tanks like the Center for Budget and Policy Priorities argue will hurt low-income families in Ohio.
The city of Cincinnati is suspending its relationship with SoMoLend, the local startup that the city partnered with in December to connect small businesses and startups to $400,000 in loans.
The broken partnership comes in response to accusations of fraud from the Ohio Division of Securities that have forced SoMoLend to stop giving out loans in the state and could lead to the business’s shutdown.
City spokesperson Meg Olberding told CityBeat in an email that although the city partnered with SoMoLend in December, it has yet to give out any loans through the crowdfunding incubator.
The Ohio Division of Securities says SoMoLend failed to gather the proper federal and state licenses for a peer-to-peer lending business and falsely inflated its performance and financing figures.
SoMoLend gained local and national recognition for supposedly helping foster startup and small businesses by linking them to loans through crowdfunding — a particularly promising proposition given the state of the economy and research from the National Bureau of Economic Research that shows startups are the best drivers for economic and job growth.
But with the extent of the charges, it’s questionable whether SoMoLend had any success to begin with.
Candace Klein, CEO of SoMoLend, told The Cincinnati Enquirer on Sunday that the company is currently in talks with the state. She stressed that the Ohio Division of Securities won’t issue a final order against SoMoLend until after a hearing scheduled for October.
SoMoLend, which stands for Social Mobile Local Lending, was founded in 2011. The business’s specialty is using crowdfunding tactics to connect small businesses and startups with lenders. It then packages the loans to sell them as notes and charges a fee or commission for its services.