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 report. 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at the beginning of 2013, would have provided $625.3 million to local governments in the 2014-2015 budget, but it was repealed in 2011 by the Republican-controlled Ohio legislature and Kasich.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).

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.

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 first five.  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 either choice. “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.

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,” Dohoney claimed. 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 office. 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.

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.