McCain's visit to Miami Valley
The Ohio Players
Local Olympian brings home silver
Economic equity program fosters regional cooperation
All Montgomery County jurisdictions participate. They give when tax receipts are good, receive if they aren't. Best of all, it all comes out equal in the end.
Sunday, December 31, 2006
There's a reason for the slash mark in the county's Economic Development/Government Equity program — because it's a two ED/GE'd sword.
"The benefit is two-fold," said Joe Tuss, county director of community and economic development. "These are dollars every county resident contributes to through the sales tax, used to create new investment and to create and retain jobs. In terms of the GE side, citizens should feel good that there is a level of regional cooperation, and the sense that we're all in this together."
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The ED portion of ED/GE attracts the most public attention, setting aside $2.7 million a year from the county sales tax for economic development grants to local jurisdictions.
The government equity (GE) portion is less well understood, but spreads some of the revenue gained by economic development across the county to communities that didn't do as well that year.
ED/GE, implemented in 1990 in Montgomery County and renewed in 2000, has 100 percent of jurisdictions participating. So it provides an annual snapshot of where the economic growth was that year.
"The 100 percent participation is so important in terms of giving you a true picture of what's going on economically," Tuss said. "If somebody isn't in it, it skews the whole picture."
The government equity formula calculates a countywide "growth contribution rate" based on tax revenue growth and increases in assessed property valuations over a "base year," three years before (the base year for 2006 is 2003).
A jurisdiction's contribution applies the countywide growth rate multiplied by increases in property valuations and tax revenues.
Revenues and values more directly tied to economic development, such as commercial property values, are more heavily weighted.
Communities with a net increase contribute to the GE pot; those with zero or negative numbers for the economic factors calculated receive funds.
The fund is divvied up based on population and the amount in the GE fund.
"If you're a recipient, you're happy to be getting that nice sum of money," Interim Riverside City Manager Charles Jones said. "But it does represent that your income tax is not performing as well for whatever reason. It does achieve revenue sharing and we're all striving to become big contributors, over time."
Participants never pay more into the GE side than they receive overall from the ED/GE program. If that does happen, the difference is settled up every three years.
"At the end of the day, it balances out," Vandalia City Manager Jeff Hoagland said. "There are communities getting that money and others paying into it because their financial situation is better that year. It does foster regional cooperation and all the communities that participate are made whole."
