January sales, use tax revenue up in Mahoning Valley, but losses looming
By Kalea Hall
YOUNGSTOWN
Despite increases in sales and use tax revenue – a main source of income for county governments – officials are still watching their budgets with concern for more impending funding losses.
The Medicaid managed-care organization sales tax, MCO, will expire June 30 because of a federal rule that says the state cannot impose the tax on Medicaid MCOs if it does not impose this tax on other MCOs.
“Any kind of increase [in sales and use tax revenue] is a positive sign,” said Dave Ditzler, chairman of the Mahoning County commissioners. “But the unfortunate part of it is each year they continue to eliminate portions of the local government fund. Now, we face the MCO loss.”
County sales and use tax is charged on goods and services such as employment services, lawn care, fitness memberships and dry cleaning. Several items are exempt, including food and prescription medication. The revenue generated goes to run county governments. Sales and use tax to economists shows whether consumers are confident and are spending more money.
The sales and use tax revenue generated in January was released to county governments in March.
At a rate of 1.25 percent, Mahoning County received $4.4 million in sales and use tax revenue, up 1 percent from last January’s $4 million in revenue, according to the Ohio Department of Taxation.
Trumbull County received $2.7 million in sales and use tax revenue with its 1 percent rate. The revenue received in January 2017 was 2.6 percent above the $2.67 million received in January 2016.
Columbiana County’s 1.5 percent sales and use tax rate brought in revenue of $1.6 million during January 2017, up 3.6 percent from the previous year’s revenue of $1.59 million.
In Trumbull County, there’s a 10-person volunteer budget committee reviewing expenses of county departments.
“Evidently, there’s ways we can save money,” Trumbull Commissioner Frank Fuda said.
Fuda said the committee should have results of its review in a couple of months. Trumbull, like all 88 counties in Ohio, has seen a loss in its local government funds from the state. Every year for the past six years the county has lost $4 million from the state, Fuda said.
To make up for losses in state funding, Mahoning County asked voters to pass a 0.25 percent increase in its sales and tax rate to fund the justice department. The voters passed it and it went into effect in April 2015.
“All that did was put us back to even,” Ditzler said. “We just need to continue to lobby our state legislation. We have to continue to look at ways to cut our costs.”
At the end of the year, both Fuda and Ditzler want to see year-over-year increases in sales and tax revenue. Last year, Mahoning County saw a 9.5 percent increase in its sales and use tax revenue; Trumbull County saw a 2.9 percent year-over-year increase to $26.56 million; and Columbiana County saw a decrease of 2.37 percent year over year to $16.44 million.