By Jordyn Grzelewski

jgrzelewski@vindy.com

BOARDMAN

Local representatives are trying to persuade Ohio to hold the township harmless as state officials prepare to pass a two-year budget that could impact local governments’ budgets.

Township Trustee Larry Moliterno today will testify before the Ohio Senate Ways and Means Committee to argue against language in the proposed budget. It would reinstate the phasing out of state reimbursements to local governments and school districts for revenue lost due to changes to the tangible personal property and public utility tangible property taxes.

“You may think that with such a large budget, we should just be able to absorb this additional cut in revenue,” reads Moliterno’s prepared testimony, referring to the township’s $18 million budget for 2015.

“I am here to tell you that we simply cannot,” it reads, detailing the township’s efforts to manage its budget, such as laying off employees, going to voters for a levy, freezing wages and collaborating with other local governments on projects.

“We’ve been trying to spread out the dollars as thin as we can, but to take another half-a-million-dollar hit – it would really hurt us,” Moliterno said in an interview.

Gov. John Kasich proposes to phase out reimbursements by 2 percent of a political unit’s total resources per fiscal year, with the final reimbursement year determined by each political unit’s estimated reliance.

Boardman’s reimbursements would end after fiscal year 2016 under the governor’s proposal.

The township previously received $576,441 in tangible personal property reimbursements from the state each fiscal year since phase-outs froze; that would decrease to $277,664 in fiscal year 2016 under the governor’s proposal.

“The roughly $576,000 that we receive today represents a very large amount of funding to Boardman Township,” Moliterno said in his testimony. “If that was to be taken away, it means taking away six police officers, or eight firefighters or two years of our annual paving budget.”

State Sen. Joe Schiavoni of Boardman, D-33rd, plans to offer an amendment to the bill that would delete the phase-out language and keep reimbursements frozen at their current level.

“Whether the money comes from the TPP fund or a different fund from the state of Ohio, it doesn’t matter to me,” he said. “If they’re going to take away the TPP and phase it out, we have to make sure we supplement those dollars from the state from a different revenue stream.”

A document released by the state Office of Budget and Management and the Department of Taxation characterizes the issue as a legacy of previous administrations, and the proposal as one that makes the transition more gradual than under current law and easier for higher-need communities.

“When the Kasich administration first took office in 2011, the administration inherited two very costly legacy programs to reimburse schools and local governments for local property taxes that were eliminated due to state law changes,” it reads.

“These reimbursements to school districts and local governments were never intended to be permanent. It does not make sense to continue to pay state compensation for local tax revenues from a long-ago tax system based on economic conditions that in many, if not most, places are much different than conditions today,” reads testimony from Timothy Keen, director of the Office of Budget and Management.

“Eventually everyone – school districts, local governments, taxpayers and the state – must adapt to the new economic and legal realities,” he said.