0 Comments · Wednesday, March 13, 2013
City Manager Milton Dohoney Jr. gave a
presentation to City Council March 6 explaining how Cincinnati could
work to reduce its structural budget deficits.
by German Lopez
Previous cuts helped cause Cincinnati budget deficit
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
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at the beginning of 2013, would have provided $625.3 million to local governments in the 2014-2015 budget, but it was repealed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).
by German Lopez
West Chester lawmaker promises to tackle debt, jobs
In news that will surprise almost no one, John Boehner was
re-elected to the U.S. House of Representative’s top spot today.
Boehner, a Republican from West Chester, will now act as U.S. House
speaker for the 113th Congress.
Just moments after his re-election, Boehner pledged to tackle the U.S. debt and deficit. The line is nothing new. When President
Barack Obama stepped into the Oval Office, the debt and deficit became top concerns
for Republicans after eight years of binge spending and tax cutting
under former president George W. Bush.
But focusing on the debt could hurt an already slow economy. In recent years, many economists, including Nobel laureate Paul Krugman, have criticized budget austerity measures for dampening economic growth.In fact, Republicans recently embraced
the economic fact by joining the rest of the country in freaking out
about the fiscal cliff. The primary concern with the fiscal cliff was
that it would have cut spending and raised taxes so much and so quickly that
it would have thrown the country back into recession. The Congressional Budget
Office estimated the wave of austerity would have spiked the U.S.
unemployment rate to 9.1 percent by the end of 2013, up from November’s
rate of 7.7 percent.
In Europe, governments have learned the lessons of
austerity all too well. Last year, the International Monetary Fund (IMF)
was pushing Europe to balance its books. Now, top IMF economists are
releasing papers admitting the IMF greatly underestimated the negative impact austerity has on the economy.
In other words, if Republicans continue focusing on austerity measures to fix
the immediate deficit, the economy could get worse.
Boehner regained the top seat in the U.S. House largely thanks to redistricting. As CityBeat covered in this week’s issue, redistricting helped Republicans win the House despite losing the popular vote to Democrats.
by Andy Brownfield
Two-to-one vote cuts rollback in half for two years to make up stadium fund deficit
Hamilton County homeowners can expect a larger bill come
tax time. The Hamilton County Board of County Commissioners on
Wednesday voted to halve the property tax rollback promised to voters as part
of the package to build the two downtown sports stadiums.
The rollback saves property owners $70 in taxes for every
$100,000 of valuation. For the next two years they will be paying an
extra $35 per $100,000 of their home’s value.
The money will be used to balance the stadium fund, which
faces a $7 million deficit. The rollback reduction is expected to raise
about $10 million. The board voted 2-1 for the proposal, with sole Democrat Todd Portune dissenting.
“The property tax rollback measure that has been advanced
so far buys us only one year, and next year we will be doing the same
thing we are doing today,” Portune said.
Portune favored raising the sales tax by 0.25 cents — to
6.75 — per dollar, which would have raised more than $30 million over 10
years. His proposal, which failed to receive any support, would have
expired after the 10 years and gone up for review annually after the
Portune said his proposal was more equitable. He said
reducing the property tax rollback was going to affect only Hamilton
County residential property owners, whereas a sales tax increase would
affect everyone who spends money in the county, including visitors from
neighboring Kentucky and Indiana.
Portune billed the tax increase as a long-term solution
that would raise more than was needed currently but would keep the fund
stable in years to come.
Board President Greg Hartmann, who authored the rollback
reduction proposal, called Portune’s plan “a bridge too far.” He said
it was too large of a tax increase and not a targeted approach to solve
the deficit problem. He said he didn’t trust future commissions to allow
the tax increase to expire.
Hartmann called the property tax rollback reduction flexible, scalable, clean, immediate and certain.
Commissioner Chris Monzel, who provided the deciding vote, said he didn’t like either and had to go against his principles with
“No way I walk out of this without breaking a promise. No way I walk out of this winning,” he said.
Monzel said he hopes that savings from the Affordable Care Act
would allow the county to lower its property tax rates to make up for
the rollback reduction.
Monzel also introduced a successful proposal that will include an annual
review of the tax budget to make sure property taxes don’t change,
a provision requiring parking revenue from The Banks to be used to
develop The Banks and a directive for the county administrator to work
with Cincinnati’s professional sports teams on concessions they can make
to help out with the stadium funding burden.
by German Lopez
City Manager's 2013 budget proposal must be approved by council, mayor
City Manager Milton Dohoney Jr. unveiled his 2013 budget plan at a press conference today. The proposal, which must be approved by City Council and
the mayor, seeks to close a $34 million deficit while avoiding major cuts
and layoffs. The proposed budget will only set the city’s course until
mid-June, when the city will transition into establishing budgets based
on fiscal years.
The biggest deficit plug will come from privatizing parking
services, which the city manager’s office says will bring in $40 million
in one-time revenue and additional revenue over 30 years as part of a
long-term contract. About $21 million of the initial lump-sum payment will be
used to close the 2013 budget deficit.
In the past, Councilman P.G. Sittenfeld voiced concerns
about privatizing parking: “I’ll await more details, but
it seems penny-wise and pound-foolish to forgo a steady revenue stream
for a lump-sum payment. Cincinnati needs a structurally balanced budget
and can’t keep relying on one-time sources. Places like Chicago and
Indianapolis have seen their parking rates more than double following
privatization — that’s a bad deal for citizens, and something we don’t
need while we’re experiencing an urban renaissance.”
Another concern is whether the city’s current parking
employees will be laid off if parking services are sold. Dohoney said
the deal for privatization will require the winning bidder to interview
all American Federation of State, County and Municipal Employees
(AFSCME) workers. Full-time workers who do not join the winning bidder will be
hired in other parts of the city government. “No AFSCME employee will be
placed on the street if they are full-time as a result of this effort,”
The rest of the deficit plug will come in cuts, cost shifting, savings,
revenue, embedded growth and one-time sources. Among these, notable
items include the elimination of the Mounted Patrol for the Cincinnati Police
Department (CPD) and a $610,770 reduction in Human Services Funding. A few departments and programs, including the CPD, will face
further minor cuts.
The city manager’s office claims the changes in the budget
are necessary mostly due to changes at the state level. Specifically,
the state government cut the Local Government Fund by 50 percent and
eliminated the tangible personal property tax reimbursement and estate
tax; altogether, losing these sources of revenue cost Cincinnati $22.2
million in the 2013 budget.
Facing the large deficit, Dohoney said he wanted to avoid across-the-board cuts and
other major cuts to growth and investment programs: “You’re not competitive
if that’s your approach.”
The budget also includes some
spending increases. The Focus 52 Program will focus on redevelopment
projects in Cincinnati’s 52 neighborhoods. If it’s successful, the new
program will “grow the city’s revenue base, create new jobs and/or
increase the population of the city,” according to the city manager’s
In other budget news, the city manager will also send out
the Tentative Tax Budget proposal, which sets the millage rate for the
operating property tax. That proposal seeks to raise the millage rate
from 5.9 mills to 6.1 mills, which will provide an estimated $31 million
in revenue, up from $23.5 million. For a $100,000 residential property,
that means a tax hike of $46.
by German Lopez
Council approves raise amid deficit, GOP versus Planned Parenthood, puppy mills regulated
It’s official: Cincinnati’s budget proposal will arrive Nov. 26.
The budget will seek to close a deficit estimated to be between $34
million and $40 million. Part of the budget plan was revealed when the
city manager’s office suggested privatizing parking.Despite the deficit the city is facing, City Council pushed forward a $21,000 raise and a one-time $35,000 bonus
for City Manager Milton Dohoney in a 6-3 vote. It’s the first raise
Dohoney is getting since 2007, but some are unhappy with the decision in
light of the deficit, which could lead to job cuts. “The city manager
is a good man, he is a hard worker, but to me this just feels out of
touch with the economic reality that we are in right now,” Councilman
P.G. Sittenfeld told Fox 19. “You don't give the highest paid employee
in the city a raise, a significant raise, when you're facing a
potentially huge budget deficit. Plus, you know, there's a very real
possibility of layoffs.”Ohio Republicans are pushing forward
with HB 298, a bill that cuts funds to Planned Parenthood. The
organization has become a popular target for Republicans
because it provides abortions, but abortion services only make up 3 percent of what Planned Parenthood offers. The move is just one of many recent moves in the Republican agenda against abortion rights.
They recently advocated renewing the heartbeat bill, and Gov. John
Kasich recently appointed two anti-abortion advocates to government
positions.The Ohio House overwhelmingly approved a bill
that will put large-scale puppy mills under more scrutiny with new
state standards and yearly inspections. Animal rights activists have
argued Ohio has become a haven for bad breeding practices due to lax
laws and regulations. CityBeat previously covered the puppy mills issue and how it enables Ohio’s dog auctions.But that’s not all
the Ohio legislature got done. The Ohio House passed a bill that
further regulates “pill mills” — doctors, pharmacies or clinics that
distribute narcotics inappropriately or for non-medical reasons — and a
bill that cracks down on “cyber stalking.” The Ohio Senate passed a bill
that essentially lowers taxes for companies that increase payroll by 10
percent.A new study
highlighted the success of some Ohio schools, including Robert A. Taft
Information Technology High School in Cincinnati. The research found the
schools succeeded despite high poverty and tight budgets. The study
indicated some key attributes of success: principals play pivotal roles,
teachers and administrators are obviously engaged and invested, school
leaders provide major incentives to teachers, data is used to measure
progress and teachers and administrators do not see a lack of parent or
community engagement as an insurmountable barrier to success. The report
also made some recommendations: establish clear transitional protocols
in case a principal leaves, engage teachers, hire teachers that are
on-board with the school’s goals, leverage great reputations and
celebrate success.Hamilton County could issue securities to raise revenue.
County commissioners are currently working on ways to close a $20
million deficit. The securities idea comes from Todd Portune, the lone
Democrat on the Board of Commissioners.The investigation into U Square worker payments is ongoing.
A City Council committee wants to see if the workers are being paid
what they are supposed to be paid. Under Ohio law, workers on
city-funded projects must get a prevailing wage, which is equivalent
to the wage earned by a union worker on a similar project. But City
Solicitor John Curp argues developers do not have to pay prevailing
wages for parts of the project that aren’t getting public funding. City
Manager Dohoney also argued that overzealous requirements could drive
businesses out of Cincinnati.Despite the pleas of more than 500,000, it does not look like Cincinnati-based Macy’s will dump Donald Trump.
The billionaire has gained recognition as a big-name Republican and
“birther” — someone who ignores all facts to call into question
President Barack Obama’s country of origin. Brian Williams, news anchor
at NBC News, described Trump aptly during election night: “Donald Trump,
who has driven well past the last exit to relevance and peered into
something closer to irresponsible here, is tweeting tonight.”Ohio Attorney General Mike DeWine is leading a new efforts to stop the use of synthetic drugs, including bath salts.To fill a vacancy, a new interim chair has been named at the Ohio Board of Regents: Regent Vinny Gupta.
He will be replacing James Tuschman, who successfully pushed a ban on
smoking in Ohio’s college campuses. Gupta’s term will run through March
2013.Meet the loneliest planet of them all. It’s an orphan that drifted away from its parent star.
0 Comments · Wednesday, June 15, 2011
Back in January 2001, the Congressional Budget Office (CBO) was estimating the nation was on course to have a negative net indebtedness beginning in 2006, partially due to various fiscal policies put into place by President Clinton. They included a tax increase on upper-income taxpayers that was approved during his first year in office, coupled with some spending cuts and increases in tax collections on items like capital gains that were sparked by the then-booming economy.