July 29, 2004
COPY OF THIS LETTER SENT TO ALL CANDIDATES AND MEMBERS OF THE OHIO GENERAL ASSEMBLY
As a follow-up to a package of information we sent in cooperation with other local government groups and libraries, we thought additional information about Ohio’s 939 cities and villages and the Local Government Funds would be useful.
For our member cities and villages the state’s Local Government Fund and Local Government Revenue Assistance Fund are vital sources of revenues. Through these funds state decision-makers keep hundreds of police officers and firefighters on duty and providing critical safety services to millions of Ohioans. In addition, these funds support other important municipal services, from health and sanitation to parks and recreation. Without these funds, many of these services could not be provided through locally-generated revenues.
While the municipal share of LGF and LGRAF makes up only about 2% of the state’s biennial budget, replacing those funds at the local level would be impossible. Replacing those funds at the local level for some of our members would mean trying to pass levies in the 5-10 mill ranges or passing municipal income tax increases of 50% or more. So, while the LGF’s for municipalities are such a relatively small part of the state budget and do not drive state tax rates, replacing the LGF’s at the local level would lead to either huge tax increases or devastating service cuts for many or our communities.
The LGF’s help Ohio municipalities, large and small. The City of Columbus, Ohio’s largest city, receives LGF assistance which makes up 8.9% of its General Fund Budget. Without those dollars, cuts would have to be made in the city’s safety forces, simply because those forces represent 69.4% of the city’s GRF expenditures. This would be true of most cities over 50,000 population.
For our smaller cities and villages, where LGF assistance may represent 30% or more of their GRF, replacing the LGF’s would involve unpassable tax proposals or devastating service cuts. In the Village of Waynesfield, LGF’s represent 54% of that village’s budget. To replace that money, the village would have to pass a levy of over 11.5 mills or make cuts in services equal to almost twice their entire police budget. In the City of Fremont, the LGF’s mean paying six police officers, three firefighters, one recreation supervisor and one-year’s worth of GRF street resurfacing. Without the LGF’s, many small cities and villages throughout Ohio would fall into fiscal emergency, lose their entire police force or layoff many of their other employees and drop the everyday services provided by those employees. Many others would try and fail to raise local taxes to make up for state reductions in LGF’s and end up in the same predicament.
Because LGF is distributed on the basis of need, any further erosion in these funds will hit hardest on the communities hit hardest by recent economic bad times. They have lost manufacturing jobs. They have seen dollars from the state and federal government dwindle. Revenue from their own local taxes have been flat or, very often, been reduced. They have tightened and cut their budgets for the last four years and will continue to do so. As has been the historical case, they will be the last to enjoy the fruits of any economic upturn.
Your support in the next biennial budget for the LGF’s means a great deal to the future of Ohio’s cities and villages. Allowing the LGF’s to get back on formula and back to sharing in the rise or fall of state revenues is in our interest and the state’s. The need for safety and other municipal services will not go away by underfunding the LGF’s. Eventually, many of these essential services, if left unfunded, will become local problems that will end up at the steps of the Statehouse. Adequately funding the LGF’s will help keep the everyday services we provide operating efficiently at the local level. We believe that is important to the health of our communities and very much in the state’s interest.
We thank you for your attention to this issue and hope you find this information helpful.
Sincerely,
Susan J. Cave
Executive Director
