An analysis released June 26 found Ohio’s top 1 percent would get the biggest breaks from the tax plan included in the final version of the two-year state budget, while the state’s poorest would pay more under the plan.
The analysis, conducted by the Institute on Taxation and Economic Policy for public policy think tank Policy Matters Ohio, shows the tax plan’s slew of tax cuts and hikes balance out to disproportionately favor the wealthy in terms of dollars and percents.
Meanwhile, the bottom 20 percent would pay about $12, or 0.1 percent, more in taxes. The second-lowest 20 percent would see their taxes go down by $5, rounded to 0 percent. The middle 20 percent would see a tax cut of $9, which is also rounded to 0 percent.
Policy Matters criticizes the tax plan, claiming the revenue should go to other programs, not tax cuts.
“Rather than approving a tax plan that will further shift Ohio’s tax load from the most affluent to low- and middle-income residents, we should direct those dollars into needed public services,” said Zach Schiller, Policy Matters Ohio research director, in a statement. “That includes restoring support for local governments and schools, and bolstering human services, from foodbanks to child care.”
Michael Dittoe, spokesperson for Ohio House Republicans, says the tax plan is supposed to provide an economic boost to almost everyone, not any specific group.
“The tax plan is going to provide an overall tax cut for nearly all Ohioans,” he says. “What this plan intends to do is not disproportionately favor the wealthy at all.”
The broad tax cuts, Republicans claim, should provide a boost to Ohio’s economy that will spur further job growth.
But Schiller argues the tax cut ultimately won’t create jobs: “A 21-percent cut that was approved in 2005 has not kept Ohio’s job market from underperforming that of the country as a whole during and after the last recession.”
The tax plan cuts income taxes for all Ohioans and particularly business owners, but it balances the cuts by hiking sales and property taxes.
Specifically, the budget cuts income taxes for all Ohioans by 10 percent over three years, gives business owners a 50-percent tax break on up to $250,000 of annual net income and creates a small earned income tax credit for low- and middle-income working Ohioans based on the federal credit.
To balance the cuts, the plan raises the sales tax from 5.5 percent to 5.75 percent, increases future property taxes by 12.5 percent and graduates the homestead tax exemption to be based on need, meaning the lowest-income seniors, disabled and widowed Ohioans will get the most out of the exemption in the future.
Most recently, the conference committee added two safeguards for low-income Ohioans: a credit that wipes out income-tax liability for Ohioans making $10,000 or less a year and another $20 credit for those making $30,000 or less a year.
The Policy Matters analysis doesn’t take into account the two changes to property taxes and several other, smaller changes to income and sales taxes, but the rest of the changes, including the conference committee’s recent adjustments, are considered.
The tax plan is part of the $62 billion state budget for fiscal years 2014 and 2015, which passed the Republican-controlled General Assembly today. It's expected Republican Gov. John Kasich will sign it into law this weekend.
Update: Budget bill passed by General Assembly.
Check out all of CityBeat’s state budget coverage:
• State Budget's Education Increases Fall Short of Past Funding
• State Budget Rejects Medicaid Expansion
• State Budget to Limit Access to Abortion
A federal appeals court yesterday reinstated an antitrust lawsuit against Duke Energy. The lawsuit accuses Duke of paying kickbacks to local companies in order to gain support for a 2004 electric rate increase. The lawsuit alleges that Duke appeased the more powerful opposing companies by including rebate deals for them. The suit is seeking unspecified damages and seeks to represent all Ohioans affected by the rate increase.
Todd Portune is continuing his quest to become the East Side's county's property tax rebate savior, yesterday offering a new idea to bail out the stadium fund: extend the half cent sales tax past 2032. The revenue created by extending the sales tax, which has no sunset clause, would repay loans the county could use to pay for maintenance and projects at the stadiums now. Republican Commissioner Chris Monzel is open to “any ideas,” though Democratic Commissioner Greg Hartmann says otherwise:
“Todd, here we go again,” snapped Commissioner Greg Hartmann. “Walking away from these leases is just fantasyland.
“How many times are we going to do this?” he asked.
Rob Portman will test out his GOP rallying cries at the Faith & Freedom Coalition in Washington, D.C. next week.
Bill Clinton says a Mitt Romney presidency would be “calamitous” for the U.S.
The Senate will vote on a gender pay equity bill today.
China and Russia say they'll help the UN more going forward, though they've been supporting Syria more than anyone really wants them to.
Here's an explanation of the Transit of Venus, for those who don't get it yet.
Nintendo has revamped its Wii to try to lure gamers from free Internet games they play on iPads.
A new PC virus can infect computers by imitating a Windows update.
Council Member P.G. Sittenfeld is circulating a small business petition to stop Cincinnati from privatizing parking services. Sittenfeld threw his support behind the petition in a statement: “Individual citizens have made clear that they are overwhelmingly against outsourcing our parking system. Now we're going to show that small businesses feel the same way. I hope that when council sees that the small businesses that are the engine of our city are strongly against outsourcing our parking, we can then nix the proposal immediately.” The petition asks city officials “to find a smart, resourceful, sustainable alternative to address the budget situation.” City Manager Milton Dohoney says parking privatization is necessary to avoid laying off 344 city workers.
Gov. John Kasich’s expanded sales tax is going to hurt a lot of people. The tax is being expanded to apply to many items included in households’ monthly budgets, such as cable television, laundry services and haircuts. The revenue from the sales tax expansion will be used to cut the state income tax by 20 percent across the board, lower the sales tax from 5.5 percent to 5 percent and slightly boost county coffers.
City Council and local residents are not impressed with the USquare development. At a City Council meeting Tuesday, Vice Mayor Roxanne Qualls described the development: “I have to say that it is underwhelming. And that’s about the kindest thing I can say about it. And also really repeats, on many different levels, virtually all of the mistakes that have ever been made in the city and in neighborhoods when it comes to creating public spaces.” But architect Graham Kalbli said he’s excited about the plan: “Because we’ve taken a vacant strip of land and really made kind of a living room for the Clifton Heights community. We wanted to do that, that was one of our overriding goals.”
The Hamilton County Board of Elections is subpoenaing 19 voters who are suspected of voting twice in the November election. Most of the voters being investigated filed provisional ballots then showed up to vote on Election Day.
David Mann is officially running for City Council. The Democrat has served as a council member, mayor and congressman in the past.
Traffic congestion isn’t just bad for drivers; it’s also bad for the environment and economy. The Annual Urban Mobility Report from the Texas A&M Transportation Institute found traffic congestion cost Cincinnati $947 million in 2011 and produced an an extra 56 billion pounds of carbon dioxide nationwide.
Leslie Ghiz is taking the judge’s seat a little early. The former city council member was elected to the Hamilton County Common Pleas Court in November, but she was appointed to the seat early by Gov. John Kasich to replace Dennis Helmick, who retired at the end of 2012.
The magic of capitalism: Delta is already matching a low-cost carrier’s fares to Denver at the Cincinnati/Northern Kentucky International Airport.
The U.S. Postal Service is ending Saturday mail delivery starting Aug. 1. The Postal Service has been dealing with financial problems ever since a 2006 mandate from U.S. Congress forced the mail delivery agency to pre-fund health care benefits for future retirees. Riddled with gridlock, Congress has done nothing to help since the mandate was put in place. This will be the first time the Postal Service doesn’t deliver mail on Saturdays since 1863.
It’s unlikely zombies could be cured by love, but it’s possible they could be cured by science.
The next Michael Jordan has been discovered:
Damaged parking meters in Over-the-Rhine are causing problems for residents and local businesses. For months, thieves have been cutting off the top of meters to steal change. The vandals directly steal revenue from the city, ensure the damaged meters won’t collect revenue until they’re fixed and force the city to shell out more money to fix the meters. Businesses and residents are also worried the damaged meters cause confusion for drivers and make the area look unattractive.
Democratic mayoral candidate John Cranley wants to debate Vice Mayor Roxanne Qualls, a Democrat who’s also running for mayor, over the city’s plan to privatize parking services. Cranley, a former council member, has pushed the city to find an alternative to the privatization plan — sometimes leading him to make claims with little backing. Qualls isn’t ecstatic about the privatization plan, but she seems to side with City Manager Milton Dohoney’s position that it’s necessary to avoid the layoff of 344 city employees.
County officials around the state are peeved at Gov. John Kasich’s budget plan because it limits how much they can leverage in county sales taxes.
The proposal bars counties from changing their sales tax rates for
three years starting July 2013, and it also adjusts county’s rates to
force a 10 percent revenue increase over the prior year beginning
December 2013. The Kasich administration claims the move is necessary to
prevent county governments from using the governor’s plan to subtly raise the sales tax, but county officials argue the
move infringes on local rights. Kasich’s plan lowers the state sales tax rate from 5.5 percent to 5 percent, but it expands what’s affected by the tax.
CityBeat analyzed Kasich’s budget proposal yesterday:
Kasich’s school funding plan is also drawing complaints from school leaders. At a press conference, Kasich made his plan sound fairly progressive, but school leaders found the actual numbers underwhelming, and 60 percent of schools won’t get any increased funding.
City Council Member Chris Seelbach took to Facebook to slam Cranley for some recent comments regarding freestanding public restrooms. During an interview with Bill Cunningham, Cranley tried to politicize the issue by saying City Council wants to build a $100,000 freestanding restroom. In his Facebook post, Seelbach explained that’s not the case: “John Cranley, if you haven't heard (which I find surprising), NO ONE on City Council has ever said, in any capacity, that we should spend $100,000+ on a 24-hour public restroom facility. No one. In fact, I went on Bill Cunningham to make that clear. I'd appreciate if you'd stop trying to politicize the real issue: Finding a way to offer more public restroom choices in our urban core for our growing and thriving city. In case you didn't hear my interview with Cunningham, or my comments to almost every media source in this region, I'll post the interview again.” Seelbach’s interview with Cunningham can be found here.
Clifton’s new grocery store will begin construction next week. Goessling's Market-Clifton is finally replacing Keller's IGA on Ludlow Avenue.
A local high school’s prom was canceled to punish students for a massive water balloon fight at lunch. The giant fight was planned as a prank on social media, and school staff tried to prevent it by warning students of the repercussions on the day of the prank. Students did not listen. Prom was lame, anyway.
PNC Bank donated $450,000 to Smale Riverfront Park. The money will be used to build the PNC Grow Up Great Adventure Playground, which will have a swinging rope bridge for kids to walk across a canyon. PNC is among a handful companies to donate to the riverfront park; most recently, Procter & Gamble donated $1 million.
Cincinnati was called the most literate city in Ohio.
The Montgomery County Democratic Party endorsed the Freedom to Marry Amendment, which would legalize same-sex marriage. CityBeat wrote about the amendment here.
Kasich’s latest budget proposal would privatize food services in prisons to save $16.2 million. The Ohio Civil Service Employees Association, which represents prison staff, has come out against the plan.
A lawsuit has been filed to take down a Jesus portrait in Jackson Middle School in southern Ohio. The lawsuit is being backed by the American Civil Liberties Union of Ohio and the Freedom from Religion Foundation. They argue the portrait is an “unconstitutional endorsement of religion and must be removed.”
A new cure for color blindness: goofy glasses.
There’s new evidence that a giant asteroid really sparked earth’s last great mass extinction event, which killed the dinosaurs.
Between October and December, the U.S. economy unexpectedly shrank by 0.1 percent — the first contraction since 2009. The downturn was primarily caused by the threat of conservative fiscal policies, particularly defense spending cuts. Dropping business inventories also helped drag down the economy. Otherwise, consumer and business spending was actually strong.
Some Republicans want another go at reducing voting rights.
Rep. Mike Dovilla, chairman of the newly created House Policy &
Legislative Oversight Committee, says he wants to consider measures that
crack down on alleged voter fraud, including reduced voting
times and a photo ID requirement to vote. But in-person voter fraud is not a real problem. News21, a Carnegie-Knight investigative reporting project, found only 10 cases of in-person voting fraud in the United States between 2000 and 2012.
That’s not even one case of in-person fraud each year. The real reason
Republicans want to enact stricter voting measures is to hinder young, minority
voters that typically support Democrats. One study found 700,000 young, minority voters were excluded by photo ID laws in 2012.
A Policy Matters Ohio report found Ohio’s income tax hits the poor and middle class a lot harder than the wealthy. The numbers from the report: “The top 1 percent of non-elderly Ohio families by income, who earned at least $324,000 in 2010, on average pay 8.1 percent of their income in state and local income, property, sales and excise taxes. By contrast, the lowest fifth, who make less than $17,000, on average pay 11.6 percent. Families in the middle fifth of the income spectrum, who make between $31,000 and $49,000, on average pay 10.6 percent.”
Cincinnati is extending its contract with Southwest Ohio Regional Transit Authority (SORTA) for a month despite an ongoing conflict, but the supposed conflict is really much ado about nothing. SORTA wants the city to guarantee it won’t use the transit fund for the streetcar, but City Council has already passed a resolution saying it won’t and Mayor Mark Mallory has repeatedly stated he will not use the transit fund for the streetcar. Due to the mayor’s race, the streetcar will be facing another contentious year at the ballot box, which CityBeat covered in-depth here.
More than 60 percent of Greater Cincinnati entrepreneurs are expecting a net profit in 2013. Most of them also expect to hire part-time employees, according to a new survey from the Entrepreneurs’ Organization. The survey is another sign of rising confidence in the U.S. economy.
The Dayton Daily News reports manufacturing is driving economic growth in Ohio, to the benefit of more than half of the state’s counties.
When defending Ohio's charter school and voucher programs, conservatives often tout the magic of “school choice,” but a Policy Matters report found school choice may hurt education standards in the state.
Ed FitzGerald, a popular Democrat from Cuyahoga County, is gearing up to run for the governor's race in 2014.
Scientists have taught bacteria to eat electricity. The trick could eventually be used to turn microorganisms into a biofuel source.
The budget bill currently working through the Republican-controlled Ohio legislature would cut taxes in a way that disproportionately favors the wealthy, according to a new analysis from Policy Matters Ohio, a left-leaning policy group.
The budget bill, which was passed the Republican-controlled Ohio House with a 61-35 vote on April 18, would cut state income taxes for all Ohioans by 7 percent. Policy Matters analyzed the result for each tax bracket: For the top 1 percent, the tax plan would cut $2,717 in taxes on average. For the middle 20 percent, it would amount to a $51 cut on average. For the bottom 20 percent, it would result in $3 on average.
The report explains the disproportionate gains are caused by the structure behind Ohio’s tax system: “Ohio has a graduated income tax, so people pay more on higher levels of earnings. Because of that, across-the-board tax cuts give much more money to the wealthiest Ohioans. This reinforces inequality and adds to the unfairness of the state and local tax system, which is weighted in favor of upper-income taxpayers when all state and local taxes are taken into account.”
Zach Schiller, research director at Policy Matters, says the Ohio House tax plan will also have little impact on Ohio’s economy.
“Since the 21-percent reduction in state income taxes approved in 2005, Ohio’s economy has underperformed the nation,” Schiller said in a statement. “There is little reason to believe that another round of income-tax cuts will produce a different result.”
Michael Dittoe, spokesperson for Speaker of the House William Batchelder and Ohio House Republicans, wrote in an email to CityBeat that there are still two months for the state government to finalize the details of the tax plan as it works through the Ohio legislature.
The budget bill still has to be approved by the Republican-controlled Ohio Senate. If changes are made to the Ohio House proposal, the Ohio Senate bill would have to be concurred by the Ohio House. It would then need to be signed by Republican Gov. John Kasich, who could line-item veto certain parts of the bill or veto the entire bill.
“It’s disappointing to see that Policy Matters Ohio would begrudge an income tax cut which will benefit all Ohioans,” Dittoe wrote in the email. “Of the seven citations in their report, ironically, five of them refer back to previous ‘studies’ issued by none other than Policy Matters Ohio. Before issuing a study of this magnitude, it may be wise for them to cite something other than themselves to make the report more credible.”
Policy Matter’s findings were gathered through the independent Institute on Taxation and Economic Policy, which plugs the numbers into its own model to gauge the impact of tax cuts on different income levels.
The resulting numbers do little to deflate concerns raised by Policy Matters about Kasich’s tax proposal, which was a much larger 20-percent across-the-board income tax cut. Policy Matters found Kasich’s tax plan also favored the wealthy, except the overall plan actually raised taxes on the state’s poorest because it included an expansion of the sales tax that the Ohio House rejected (“Smoke and Mirrors,” issue of Feb. 20).
While fact checking an interview, CityBeat discovered it will be possible to circumvent the parking plan’s cap on meter rate increases through a multilayer process that involves approval from a special committee, the city manager and the Port of Greater Cincinnati Development Authority. The process adds a potential loophole to one of the city manager’s main defenses against fears of skyrocketing rates, but Meg Olberding, city spokesperson, says raising the cap requires overcoming an extensive series of hurdles: unanimous approval from a board with four members appointed by the Port Authority and one selected by the city manager, affirmation from the city manager and a final nod from the Port Authority. Olberding says the process is necessary in case anything changes during the 30-year time span of the parking deal, which CityBeat covered in detail here.
Democratic mayoral candidate John Cranley launched DontSellCincinnati.org to prevent the city manager’s parking plan, which semi-privatizes the city’s parking assets. The website claims the plan gives for-profit investment companies power over enforcement, guarantees 3-percent rate increases every year and blows through all the money raised in two years. The plan does task a private company with enforcement, but it will be handled by Xerox, not a financial firm, and must follow standards set in the company’s agreement with the Port Authority. While the plan does allow 3-percent rate increases each year, Olberding says the Port Authority will have the power to refuse an increase — meaning it’s not a guarantee.
Arnol Elam, the Franklin City Schools superintendent who sent an angry letter to Gov. John Kasich over his budget plan, is no longer being investigated for misusing county resources after he paid $539 in restitution. CityBeat covered Elam’s letter, which told parents and staff about regressive funding in Kasich’s school funding proposal, and other parts of the governor’s budget in an in-depth cover story.
To the surprise of no one, Ohio’s oil lobby is still against Kasich’s tax plan, which raises a 4 percent severance tax on oil and wet gas from high-producing fracking wells and a 1 percent tax on dry gas.
Local faith leaders from a diversity of religious backgrounds held a press conference yesterday to endorse the Freedom to Marry and Religious Freedom Amendment, an amendment from FreedomOhio that would legalize same-sex marriage in the state. Pastor Mike Underhill of the Nexus United Church of Christ (UCC) in Butler County, Rabbi Miriam Terlinchamp of Temple Sholom, Pamela Taylor of Muslims for Progressive Values and Mike Moroski, who recently lost his job as assistant principal at Purcell Marian High School for standing up for LGBT rights all attended the event. CityBeat covered the amendment and its potential hurdles for getting on the 2013 ballot here.
Vanessa White, a member of the Cincinnati Public Schools board, is running for City Council. White is finishing her first four-year term at the board after winning the seat handily in 2009. She has said she wants to stop the streetcar project, but she wants to increase collaboration between the city and schools and create jobs for younger people.
The Ohio Bureau of Motor Vehicles’ (BMV) policy on providing driver’s licenses to the children of illegal immigrants remains unclear. Since CityBeat broke the story on the BMV policy, the agency has shifted from internally pushing against driver’s licenses for Deferred Action for Childhood Arrivals (DACA) recipients to officially “reviewing guidance from the federal government as it applies to Ohio law.” DACA is an executive order from President Barack Obama that allows the children of illegal immigrants to qualify for permits that enable them to remain in the United States without fear of prosecution.
A survey from the Ohio-Kentucky-Indiana Regional Council of Governments found locals are generally satisfied with roads, housing and issues that affect them everyday. The survey included 2,500 people and questions about energy efficiency, infrastructure, public health, schools and other issues.
Ohio Attorney General Mike DeWine revealed 7,000 Ohioans have received more than $280 million in consumer relief as part of the National Mortgage Settlement announced one year ago. The $25 billion settlement between the federal government and major banks punishes reckless financial institutions and provides relief to homeowners in the aftermath of the 2008 financial crisis.
Ohio received a $3 million federal grant to continue improving the state’s health care payments and delivery programs.
Cincinnati home sales reached a six-year high after a 27-percent jump in January.
CityBeat’s Hannah “McAttack” McCartney interviewed yours truly for the first post of her Q&A-based blog, Cinfolk.
Crows have a sense of fairness, a new study found.
A citizen committee has determined that levy-funded Hamilton County social-service agencies need to provide their services with fewer resources, advising that property owners pay the same levy rate despite decreases in property values that will reduce funding for groups that help senior citizens and people with mental illnesses. The decision by the 11-member committee will reportedly affect 30,000 residents who rely on such agencies to provide services such as meal delivery and counseling. In order to keep funding level the levy would have had to increase the cost for the owner of a $100,000 home by $6.
From The Enquirer:
Bosses of the Council on Aging of Southwestern Ohio had already agreed to live on less, but argued against some committee recommendations.
• Raising the age criteria. Currently 9 percent of clients are between 60 and 70 years old. An agency spokeswoman said that’s because services are disability-based. Some “younger” seniors – those suffering from strokes and early Alzheimer’s, for instance – have more needs than older people.
• Requiring new clients to meet U.S. legal resident requirements. According to the agency, screening for U.S. citizenship would make the program ineligible to use Older Americans Act dollars, at a cost of almost $1.2 million a year. The spokeswoman said all clients live in the county.
Enquirer reporters Carrie Whitaker and Janice Morse broke from traditional journalistic standard on Tuesday by reporting the names of teenagers involved in an alleged theft and police chase. The three girls, ages 16, 14 and 12, were identified by full name and as being from Avondale and Pleasant Ridge. A follow up story on Wednesday reported two of the girls being released from the hospital. It also included the minors’ names and did not include a reporter’s byline.
Jean Schmidt sided with Democrats on an attempt to stop Republicans from cutting even deeper the funding for the national food stamp program. The legislation that passed will cut the Supplemental Nutrition Assistance Program (SNAP) by more than $16 billion over 10 years. GOP lawmakers wanted it cut by $33 billion.
Iran put on a missile show on Friday, demonstrating the accuracy of its long-range missiles and their ability to hit Western bases and Israel.
Headline: “Wells Fargo Posts $4.6 Billion Profit, Up 17%.” Big ups, Wells Fargo!
A nearly complete skeleton of a human ancestor has been found in South Africa.
As part of an effort supporting a state earned income tax credit (EITC), Policy Matters Ohio unveiled an interactive map today that shows the potential benefits to taxpayers in different counties.
For Hamilton County, about 19 percent of tax-filing households would qualify for the program. A 10-percent EITC would return about $15.6 million to households in Hamilton County, or about $225 on average for each qualifying filer. A 20-percent EITC would return about $31.2 million to Hamilton County, with each qualifying filer getting about $451 on average.
EITC is a tax credit that goes to working families, typically favoring low- and middle-income earners with children. It is already used by the federal government and several states to progressively reward employment.
Since then, Ohio House Republicans have rejected most of Kasich's tax proposals, instead downsizing the plan to a 7-percent across-the-board tax cut with no sales tax expansion.
Here is the interactive map, courtesy of Policy Matters:
Even as it faces budget cuts, the Hamilton County Sheriff’s office says it wants more staff to keep up with higher jail populations — especially in light of a new measure that will keep more people detained until they appear in court. The measure is in response to some people never showing up to court after being released from jail. Staff are crediting the feasibility of the measure to Hamilton County Sheriff Jim Neil encouraging them to think “outside the box.” Still, Hamilton County Board of Commissioners President Chris Monzel says the cost of the program might require Neil to think “inside the box.”
The Ohio Tax Credit Authority is giving tax breaks to 13 businesses around the state in hopes of creating 1,417 jobs and spurring $83 million in investment. Seven of the projects are in the Hamilton, Butler and Clinton counties, with one in Cincinnati.
The Ohio House easily passed a bill that would effectively shut down Internet sweepstakes cafes, but the Ohio Senate is including the measure in a more comprehensive gambling bill. Senate President Keith Faber says there are a lot of issues related to gambling in Ohio, and the cafes are just one part of the problem.Ohio Sen. Rob Portman is one of many being targeted by New York City Mayor Michael Bloomberg’s pro-gun control ad campaign. Bloomberg is a leader in supporting more restrictive gun measures, and he’s planning on airing the ads in 13 states during the ongoing congressional spring break to push for stricter background checks and other new rules.
Ohio failed to show improvement in the latest infrastructure report card from the American Society of Civil Engineers (ASCE). In both 2009 and 2013, Ohio got a C- for its infrastructure, which translates to 2,462 structurally deficient bridges and puts about 42 percent of roadways as “poor” or “mediocre” quality. But the report might not be as bad as it sounds. The Washington Post’s Brad Plumer argues that the ASCE is notoriously too harsh.
Duke Energy rolled out a new logo yesterday.
A former Miami University student is facing charges for allegedly changing his grades.
More options aren’t always a good thing, according to some science. A new study found more choices can lead to bad, risky decisions.