The City of North Royalton has joined other Ohio cities in an effort, trying to encourage state officials to consider municipalities when they determine how to utilize a projected surplus of tax money in the state budget.
On September 4, the North Royalton City Council unanimously adopted a resolution imploring Ohio Governor John Kasich and the Ohio General Assembly to distribute the state budget surplus tax dollars to municipalities. The legislation was sponsored by Mayor Bob Stefanik, Council President Larry Antoskiewicz and all of the North Royalton City Council. The cities of Barberton, Fairview Park and Grove City have also introduced similar legislation.
The surplus in the Ohio budget is projected at about $147 million at the end of the state’s current biennium. The Governor has proposed utilizing the surplus by increasing the state’s rainy day fund, bringing that fund to its maximum legal limit, as well as adjusting withholdings from the paychecks of Ohio residents.
“When the recession hit, everyone understood that they had to do their part to reduce costs. When those cuts began, we assumed they were temporary cuts. Everyone did their part, making their cuts, with the understanding that it would be restored when the economy rebounded. Unfortunately, the state kept that money to fatten their coffers to the point where it has reached the maximum amount allowable to carry over. We believe it is time to reinstate some of those government cuts that happened then,” said Stefanik.
The City of North Royalton has experienced state-funded losses over the last ten years, including the reduction of the local government fund, the elimination of the Ohio estate tax and the phase out of the business personal-property tax. “We have lost just over $7 million, ($7,023,959.40) since state funding cuts were enacted,” said North Royalton Finance Director, Eric Dean. “Since local government fund cuts were enacted, we have lost a cumulative amount of $2,615,525 in funding from the state of Ohio, an average decrease of $373,000 per year to our local government funding. We are receiving approximately 43% of what was received prior to cuts being enacted in 2011. On top of the state local government cuts, estate taxes were also eliminated. We have lost an additional $2,950,000 in estate taxes based on the average of collections before the estate tax was eliminated.” North Royalton’s state shared taxes were $657,731 in 2011. They dropped to $62,902 in 2013 and have stayed level, about $280,00-$315,00 from 2014 through 2018.
The resolution states that “the sudden revenue loss has made it increasingly difficult to provide basic services, rebuild infrastructure, and bolster public safety services to fight the opioid epidemic; and when municipalities experience success in fostering safe communities, building sound infrastructure, and increasing economic development, the State of Ohio reaps the benefits as well.”
Dean said that if the state agrees to the distribution, the amount to each city could depend on a number of different calculations. It could be less than 1% of the total amount to be distributed. It would be a small share that, speculatively, could be anywhere from $15,000 to $100,000.
By GLORIA PLEVA KACIK
Contributing Writer