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Report: Kasich’s Tax Proposal Favors Wealthy

0 Comments · Wednesday, February 19, 2014
Gov. John Kasich’s income tax proposal would excessively favor Ohio’s wealthiest, an analysis from Policy Matters Ohio and the Institute on Taxation and Economic Policy found.  
by German Lopez 02.14.2014 64 days ago
Posted In: News, Economy, Governor at 02:19 PM | Permalink | Comments (0)
 
 
policy matters pizza

Report: Kasich's Tax Proposal Favors Wealthy

Proposal would let poor buy a slice of pizza, while top 1 percent could buy a trip to Italy

Gov. John Kasich's income tax proposal would disproportionately favor Ohio's wealthiest, an analysis from Policy Matters Ohio and the Institute on Taxation and Economic Policy found.Specifically, the proposal would on average cut taxes by $2 for the bottom 20 percent of Ohioans, $48 for the middle 20 percent and $2,515 for the top 1 percent.The proposal "may allow low-income Ohioans to buy a slice of pizza a year, on average," Policy Matters claims. "Middle-income Ohioans could purchase a cheap pizza maker. For the state's most affluent taxpayers, on average it would cover round-trip airfare for two to Italy, with some money left over to pay the hotel bill and buy some real Italian pizza."Under the model, Kasich's proposal would cut Ohio's income tax rates across the board by 7 percent. The goal is to bring Ohio's top tax rate, which kicks in only for income above $208,500, under 5 percent, as the governor previously proposed.Although a plurality of Americans oppose tax cuts for the wealthy, Kasich and other Republicans consistently push the tax cuts to help what they call "job creators." In the most recent state budget, Kasich and Republican legislators approved another series of across-the-board tax cuts that disproportionately benefited the state's wealthiest.In the aftermath, economic indicators from conservative, liberal and nonpartisan analysts show Ohio's economy is consistently among the worst performers in the country.The story is typical for Ohio: In 2005, the state cut income taxes across the board by 21 percent. Since then, Policy Matters found Ohio to be one of just a dozen states that actually lost jobs.Other research backs up Policy Matters' findings. In a report analyzing tax cuts for the nation's wealthiest, the Congressional Research Service (CRS) found tax cuts for the wealthy aren't correlated with increased economic growth."There is not conclusive evidence, however, to substantiate a clear relationship between the 65-year steady reduction in the top tax rates and economic growth. Analysis of such data suggests the reduction in the top tax rates have had little association with saving, investment, or productivity growth," CRS concluded. "However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution."Meanwhile, Cincinnati's poorest continue to struggle in a vicious cycle of poverty that consumes about 34 percent of the city's population and more than half of the city's children. CityBeat covered poverty and its effects on Cincinnati in greater detail here.
 
 
by German Lopez 06.19.2013
Posted In: Budget, News, Taxes at 10:13 AM | Permalink | Comments (0)
 
 
ohio statehouse

Report: Ohio Tax Code Increasingly Complicated

Reform may come later this year

Politicians and economists often talk favorably about simplifying the tax code, but a June 17 report from Policy Matters Ohio found Ohio’s tax code will remain complicated under the budget plan being discussed in the Ohio House and Senate.Meanwhile, a spokesperson for House Republicans says reform will come through separate bills later this year. The Policy Matters report, titled “Breaking Bad: Ohio tax breaks escape scrutiny,” found the state’s tax code will include 129 tax exemptions, deductions and credits if the Senate’s 2014-2015 budget is approved — one more tax break than the previous biennium. Altogether, the Ohio Department of Taxation estimates the tax breaks will cost Ohio nearly $8 billion in fiscal year 2015. The Senate budget repealed two tax breaks, but it simultaneously added or expanded a dozen, according to the report. Among the additions was a 50-percent income tax deduction for business owners worth up to $375,000 of annual income, which Policy Matters says will largely benefit passive investors, one-man firms and partnerships that will not add jobs. Policy Matters found 44 tax breaks have been eliminated since 2003 because of the elimination of corporate franchise and estate taxes. But in that time frame elected officials have added and expanded so many new tax breaks that there are now only nine less tax breaks than there were in 2003. The report claims many of the tax breaks are wasteful. One example: An almost $20 million a year exemption for pollution-control equipment purchased by utility companies. The report says most of the purchases are already mandated by the state government, which means the state is effectively paying companies to follow the law and regulations. The report ultimately calls for thorough, regular reviews of the state’s tax breaks. “It is time for the General Assembly to scrutinize spending through the tax code as it does other state expenditures,” said Zach Schiller, report author and research director at Policy Matters Ohio, in a statement. At the beginning of the 2014-2015 budget process, House Speaker William Batchelder (R-Medina) and Senate President Keith Faber (R-Celina) said one of their goals was to simplify the tax code. Mike Dittoe, spokesperson for Batchelder and Ohio House Republicans, says such reform will now be pursued in separate bills, probably later in the summer or fall. “The budget is obviously a very labor-intensive process and there’s lots of moving parts,” he says. “A lot of members of the House and Senate just want to make sure that things get done right.” Instead of simplifying the tax code in the budget, Republican legislators are focused on passing tax cuts. The House and Senate are currently working on reconciling their separate tax plans by merging and downsizing them. The joint plan is “likely to be unveiled in its entirety here over the next few days,” Dittoe says. The House approved a 7-percent across-the-board income tax cut in its budget plan. But the Senate cut the House’s tax proposal and approved a tax deduction for business owners instead. Supporters say the tax cuts will spur the economy and create jobs, while opponents claim the plans are misguided and will fail to lift the lower and middle classes.
 
 
by German Lopez 12.27.2013 113 days ago
Posted In: News, Economy, Streetcar at 09:41 AM | Permalink | Comments (0)
 
 
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Morning News and Stuff

Streetcar construction restarts, minimum wage hike incoming, jobless benefits to expire

Construction on the $132.8 million streetcar project restarted yesterday, marking an end to the nearly two-month drama brought on by Mayor John Cranley’s election and his threats of cancellation. City Council paused the project for a little more than three weeks to conduct an audit on its costs, but the legislative body agreed to restart construction last week after receiving a signed agreement from the Haile Foundation that the philanthropic group will provide $9 million over 10 years to help pay for $3.13-$3.54 million in annual operating costs. An automatic increase on Ohio’s minimum wage at the start of the new year will benefit 330,000 Ohioans, according to an analysis from the Economic Policy Institute (EPI). The higher wages should translate to a better economy for all Ohioans: EPI found the automatic increase will generate nearly $39 million in economic impact and 300 full-time jobs. Since a voter-approved measure in 2006, Ohio has been among several states who peg the minimum wage to increases in the cost of living.More than 36,000 Ohioans will lose emergency unemployment benefits for the long-term unemployed tomorrow following a lack of congressional action, according to left-leaning think tank Policy Matters Ohio. The emergency benefits were passed by Congress at the start of the Great Recession to help those hit worse by the economic downturn, but Congress failed to extend the benefits before it recessed for the holidays despite lingering signs of a weakened economy. Without the extension, Ohioans can tap into just 26 weeks of state-provided jobless aid; federally funded emergency benefits give the unemployed another 37 weeks to find work before losing government assistance.Here are CityBeat’s top stories of 2013.The annual review of the two-year state budget could include income tax cuts, said Ohio’s tax chief. The statement follows Gov. John Kasich’s announced push for another income tax cut to help spur Ohio’s slowing economy. The Republican governor signed a state budget that reduced taxes — particularly for the wealthy — earlier in the year, but Ohio’s economy still slowed down in the past few months as the state unemployment rate surpassed the national rate for the first time in years.With the Ohio Supreme Court’s rejection last week of a challenge to the state’s federally funded Medicaid expansion, conservatives are conceding the battle is “over with” for now. Gov. Kasich pursued the federally funded expansion without approval from the General Assembly by going through the seven-member Controlling Board, but Republicans, who largely opposed the expansion of a government-run health care program from the start, fought against the board’s approval in court.Gov. Kasich was “stingy” with his clemency powers during his third year in office, according to The Columbus Dispatch. Even though a review found Cintrifuse is a “Lead Applicant with strong position within SW Ohio entrepreneurial ecosystem,” Ohio Third Frontier denied state tax credits for the local startup incubator because, according to the state review group, Cintrifuse maintains an unrealistic goal to scale to 60 tenants in its first year and lacks strategy or process for the incubator services, graduation focus, an adequate staffing plan and a defined tenant award process. Delta briefly provided very low air fares following a technical error yesterday. Much to scientists’ frustration, 2014 could be a bad year for the flu after the adaptive virus evolves.Follow CityBeat on Twitter:• Main: @CityBeatCincy • News: @CityBeat_News • Music: @CityBeatMusic • German Lopez: @germanrlopez
 
 
by German Lopez 06.27.2013
Posted In: News, Budget, Taxes at 12:14 PM | Permalink | Comments (0)
 
 
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Report: State Budget Tax Plan Favors Wealthy

Top 1 percent to get $6,083 tax cut

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.On average, the top 1 percent would see their taxes fall by $6,083, or 0.7 percent, under the plan. The next 4 percent would pay $983, or 0.5 percent, less in taxes. 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
 
 
by German Lopez 06.20.2013
Posted In: News, Parking, Taxes, Police at 09:13 AM | Permalink | Comments (0)
 
 
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Morning News and Stuff

Texting while driving eludes police, parking lease stalled, Ohio tax code still complex

Even though it’s now illegal under local and state law, texting while driving often eludes punishment in Greater Cincinnati. The Hamilton County Sheriff’s Department has issued no tickets so far to vehicular texters, while the Cincinnati Police Department has given out 28, with only four going to teenagers. Although almost everyone acknowledges the dangers of texting while driving, police say it’s very difficult to catch texters in the act, especially since most of them claim they were just making phone calls. Otto Budig, board chairman of the Greater Cincinnati Port Authority, apparently told The Cincinnati Enquirer that the Port Authority won’t sign the parking lease until it gets assurances about city funding. City Council considered pulling $100,000 from the Port Authority while putting together the budget for fiscal year 2014. Now, Budig says the Port Authority wants some sort of financial assurance, perhaps as part of the parking lease, that the city won’t threaten future funding. The city announced Tuesday it had signed the lease, but some opponents, including Councilman P.G. Sittenfeld, are still looking for ways to repeal the plan. A Policy Matters Ohio report found the state’s tax code remains complicated under the Ohio Senate budget plan and the budget actually added tax breaks, despite earlier promises of simplification from House and Senate leaders. Meanwhile, Mike Dittoe, spokesperson for Ohio House Republicans, says the General Assembly will take up tax reform later in the year. The Ohio Department of Taxation says the tax breaks will cost Ohio nearly $8 billion in fiscal year 2015, and Policy Matters says many of the exemptions, deductions and credits are wasteful. Commentary: “Republican Medicaid Opposition Ignores Ohio’s Best Interests.” JobsOhio topped a ranking from Investigative Reporters and Editors (IRE) that looks at government agencies’ “unrelenting commitment to undermining the public's right to know.” IRE mocked JobsOhio and the state Republicans for making it increasingly difficult to find out how the agency uses its public funds. Democrats, including gubernatorial candidate Ed FitzGerald, have also criticized Republicans for blocking a public audit of JobsOhio, which was established by Gov. John Kasich and Republican legislators in 2011 to eventually replace the public Ohio Department of Development. JobsOhio’s supporters argue the agency’s privatized, secret nature allows it to move at the “speed of business” to better boost the economy. The Cincinnati Museum Center is looking to ask Hamilton County residents to renew its operating levy in May 2014, even though the museum promised in 2009 that it wouldn’t do so. The museum argues circumstances have changed, with Union Terminal crumbling and in need of about $163 million in repairs. When the museum originally made its promise against more operating levies, it was expecting to make repairs through a capital levy, but Hamilton County commissioners dismissed that idea. Hamilton County commissioners will have to approve the operating levy before it goes on the ballot. An Ohio bill would ban anyone under the age of 18 from tanning at a salon unless a doctor gives permission for medical reasons. This is the third time Ohio legislators have proposed measures against indoor tanning in recent years. Personhood Ohio, the anti-abortion group trying to ban abortions in Ohio by defining life as beginning at conception, is fundraising by selling assault rifles. Here is a map showing how green Earth is in the most literal terms. We now have an explanation for why everyone is so nice and loving to CityBeat’s Hannah McCartney: A study found people are mostly mean to their unattractive coworkers. Got questions for CityBeat about anything related to Cincinnati? Submit your questions here and we’ll try to get back to you in our first Answers Issue. CityBeat is looking to talk to convicted drug offenders from Ohio for an upcoming cover story. If you’d like to participate or know anyone willing to participate, email glopez@citybeat.com.
 
 
by German Lopez 04.30.2013
Posted In: News, Education, Budget at 10:52 AM | Permalink | Comments (0)
 
 
cover-kasich-2

Survey Confirms Statewide School Cuts

Seventy percent of schools cut budgets for 2012-2013 school year

A survey released April 29 found Ohio schools are making cutbacks in response to budget cuts previously approved by Republican Gov. John Kasich and the Republican-controlled Ohio legislature. The 15-question survey from left-leaning Policy Matters Ohio, which received responses from 42 percent of the state’s K-12 school districts in 82 counties, found 70 percent of Ohio schools made cuts for the ongoing 2012-2013 school year, 82 percent cut positions, 84 percent reduced or froze compensation and 62 percent expect budget shortfalls next year if the state doesn’t increase funding. “Long-term investment in education is the best way to build opportunity for Ohioans,” said Piet van Lier, education researcher at Policy Matters Ohio, in a statement. “Instead, Ohio’s cuts to school funding have forced schools to get rid of staff, reduce pay, cut materials and increase class sizes.” The survey found the cuts have led to a reduction in education quality, with 43 percent of Ohio schools reporting larger class sizes, 23 percent reporting less course options, 57 percent cutting materials, supplies, textbooks or equipment for the 2012-2013 school year and 22 percent reducing extracurricular activities or introducing pay-to-play for them. Policy Matters and Innovation Ohio, another left-leaning think tank, previously found Kasich’s 2012-2013 budget slashed education funding by $1.8 billion. In his latest budget proposal, Kasich proposed increasing education funding, although in a way that disproportionately benefited wealthier school districts (“Smoke and Mirrors,” issue of Feb. 20). Since then, the Ohio House passed its own budget bill that rejects Kasich’s proposal and increases overall school funding in a more equitable way. But Policy Matters says the increases aren’t enough. Its analysis found school funding is failing to keep up with inflation, with 2015 funding projected to fall $1.2 billion short of what funding would have looked like if it had kept up with 2006’s inflation-adjusted levels. “Neither Gov. Kasich nor the Ohio House have adequately addressed the needs of Ohio’s schools in their budget proposals,” van Lier said in a statement. “The Senate must now lead the way in crafting a stronger, more predictable funding system for the next two years and beyond.” Cincinnati Public Schools said state funding cuts were one reason the school district needed Cincinnati voters to approve a school levy in 2012 (“Battered But Not Broken,” issue of Oct. 3). The levy, known as Issue 42, passed in the November election.Innovation Ohio previously found Kasich’s budget cuts have led to levies all around the state, effectively increasing local taxes by $1.3 billion since May 2011. “By cutting taxes primarily for the wealthy at the state level, Gov. Kasich and the Republican-controlled legislature have merely pushed the need for tax increases down to the local level,” said Janetta King, president of Innovation Ohio, in a statement. Kasich spokesperson Rob Nichols previously told CityBeat that the cuts were necessary to balance the budget, as required by state law. “The reality is we walked into an $8 billion budget deficit,” he said. “We had to fix that.”
 
 
by German Lopez 04.26.2013
Posted In: News, Economy at 03:34 PM | Permalink | Comments (0)
 
 
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Ohio Is No ‘Economic Miracle’

Liberal, conservative think tanks warn of bad signs in state’s economy

It’s one issue Ohio’s leading conservative and liberal think tanks seemingly agree on: The “economic miracle” often touted by Gov. John Kasich is not really happening. The bleak economic news has been highlighted by recent reports from the right-leaning Buckeye Institute for Public Policy Solutions, which supports little government intervention in the economy, and the left-leaning Policy Matters Ohio, which focuses on policies that can benefit low- and middle-income Ohioans. The March “Ohio by the Numbers” report from the Buckeye Institute did acknowledge that Ohio has a lower unemployment rate than the national average, but the report was particularly hard on Ohio’s lacking private sector job growth. It pointed out the state lost 16,800 private sector jobs in February, ranks No. 27 in the nation for private sector job growth since January 2010 and ranks No. 47 for private sector job growth since January 1990. Policy Matters’ March report was similarly harsh: “Since the end of the recession, Ohio has added 133,700 jobs, growing at a rate of 2.7 percent. But that growth leveled off in the second half of 2012, and the reported zigzag of the last two months means that Ohio has only added 2,700 jobs over the past year, growing at a very weak 0.1 percent.” The news may come as a surprise to those who have been reading seemingly positive job news in recent months. Policy Matters places the problem on the inherent volatility in job reports, which are based on household surveys: “This volatility should serve as an important reminder: Monthly numbers are preliminary and will likely be revised, so it is unwise to make too much over the month-to-month changes. Longer-term trends provide a more accurate gauge of the state’s economic health.” While they agree on the problem, the two think tanks disagree on the causes and solutions. Greg Lawson, policy analyst at the Buckeye Institute, says the biggest problem is Ohio’s tax system. In this area, he points out three major problems: higher income tax rates than other states, an unusual amount of municipalities in Ohio with income taxes and complicated filing for individuals and businesses. “You find nowhere else in the entire country a situation in which someone has to file multiple income tax forms ... for different jurisdictions they work in,” he says, citing the different tax rates and credits someone working in multiple municipalities might have to deal with. “That creates a drag on the efficiency of being able to set up businesses.” As far as tax cuts are concerned, another report from Policy Matters found a series of tax cuts passed by the Ohio General Assembly in 2005 had little impact on the state’s economic growth. The report found Ohio experienced job losses while the rest of the country grew, and not a single Ohio sector outpaced national performance. The report concluded, “State economies are complicated and there are many reasons why Ohio’s job growth is lagging. However, it is clear that the 2005 tax cuts did not bring about the promised job growth. There is no reason to think that further tax cuts will, either.” Instead, Policy Matters has focused on austerity, which led to the public sector job cuts outlined in Policy Matters’ March report: “A private-sector gain of 16,900 jobs has been nearly erased by the 14,200 jobs lost in the public sector. Most of those public job losses happened at the local level.” Indeed, federal sequestration has already caused some damage in Ohio, and local government funding cuts approved by Kasich have also forced local governments to cut back (“Enemy of the State,” issue of March 20).
 
 

Policy Group: Ohio House Tax Plan Favors Wealthy

0 Comments · Wednesday, April 24, 2013
The budget bill currently working through the Republican-controlled Ohio legislature would cut taxes in a way that favors the wealthy, according to a new analysis.   
by German Lopez 04.23.2013
Posted In: News, Voting, Budget, Police at 09:00 AM | Permalink | Comments (0)
 
 
news1_mcmicken

Morning News and Stuff

House budget bill may suppress student voters, tax plan favors wealthy, police chief may go

An amendment in the Ohio House budget bill last week would make it so universities have to decide between providing voting information to students or retaining millions of dollars in out-of-state tuition money. The amendment would make it so universities have to classify students as in-state — a classification that means lower tuition rates — when providing documents necessary for voting. Republicans claim the measure is “common sense” because anyone voting for Ohio’s elections should be an Ohio resident. But the amendment has provoked criticism from Democrats and universities alike, who say universities are being thrown into the middle of a voter suppression scheme. An analysis from left-leaning Policy Matters Ohio found the tax plan currently working through the Republican-controlled Ohio legislature favors the wealthy. The analysis also claimed there’s little evidence the across-the-board tax cuts suggested would significantly help Ohio’s economy. The plan still needs to be approved by the Republican-controlled Ohio Senate and Republican Gov. John Kasich. Council members are asking Cincinnati Police Chief James Craig to remain in Cincinnati instead of taking a job in Detroit, but City Manager Milton Dohoney Jr. didn’t seem convinced that much can be done. Dohoney said Craig’s hometown is Detroit, a city that has suffered in recent years as the local economy has rapidly declined. Democratic Cuyahoga County Executive Ed FitzGerald is running for governor, and he will make Cincinnati one of his first stops for his campaign kick-off tour. FitzGerald is challenging Republican Gov. John Kasich in 2014, who has held the governor’s office since 2010. A recent poll found Kasich in a comfortable position with a nine-point lead on FitzGerald, but many respondents said they don’t know enough about FitzGerald to have an opinion on him. Greater Cincinnati home sales hit a six-year high in March, with 2,190 homes sold. The strong housing market, which is recovering from a near collapse in 2008, is widely considered by economists to be a good sign for the overall economy. But Ohio’s venture capital investments dropped to a two-year low, according to data from PricewaterhouseCoopers and the National Venture Capital Association. The Ohio EPA and Hamilton County Recycling and Solid Waste District are partnering up to provide a $250,000 grant to help purchase equipment to screen, clean and sort glass — an important part of the recycling industry. Councilman P.G. Sittenfeld is asking Cincinnatians to forgo lunch on April 24 to take part in the Greater Cincinnati Day of Fasting. The event will let participants “experience a small measure of the hunger that is a part of many people’s daily lives,” according to a press release from Sittenfeld’s office. Participants are also being asked to donate money to the Freestore Foodbank. A ceremony for the event will be held on April 24 at noon in Fountain Square. The U.S. Senate is moving toward approving bill that would allow states to better enforce and collect online sales taxes. Mars One is calling all applicants for a mission to colonize Mars in 2023. The sport of the future is here: combat juggling:
 
 

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