Area economy growing but shaky, business leaders say

Warren County joins the nation in starting to claw its way out of the economic recession that has hamstrung growth for nearly half a decade, but many speed bumps and pitfalls remain, cautioned business leaders at an economic outlook forum Tuesday.

“We are very blessed because Cincinnati is coming out faster, Butler County is coming out a lot stronger and by every measure — the measures being things like employment, income per household, and value of homes — Warren County leads the whole region, leads the state and leads the nation,” said Steve Wilson, chairman and CEO of LCNB National Bank.

The country needs a stronger gross domestic product to create new jobs, Wilson said. The national GDP currently hovers in the mid 2 percent range and needs to be around 3.5 percent, Wilson said.

The recovery is still very fragile, Wilson cautioned. Two key factors of concern, in his opinion, are the fiscal cliff and inflation. The fiscal cliff is a coalescing of several tax credit expiration and other factors that could trigger a new recession if not handled properly. Wilson, himself a conservative, said compromise would have to be reached to control the country’s overwhelming deficit.

“I know we are a very conservative county and I know we have a lot of people that pound the table and say no new taxes,” Wilson said. “There’s going to have to be a compromise. Wouldn’t most of you take a compromise that was something like for every dollar of new taxes there’s $10 of spending cuts … If we don’t address the deficit and national debt we’re going to truly fall off a cliff.”

The housing market was also starting to bounce back from a bottoming out point in 2011, said Carolyn Rolfes, president of the Home Builders Association for Greater Cincinnati and co-owner of Potter Hill Homes. Warren County continued to lead the area in new home sales, Rolfes said, with an 11 percent increase over 20111.

The growth fluctuated greatly by location, Rolfes noted, with areas like Springboro seeing a 27 percent increase in new homes, South Lebanon a 16 percent increase and Hamilton Twp. a 14 percent increase. Meanwhile Lebanon was down 69 percent, and Mason and Turtlecreek Twp. were flat, statistics Rolfes attributed to a lack of inventory in those areas. Warren County saw the most permits pulled by more than 100 in 2012 among Butler, Hamilton, Clermont and Warren counties. Rolfes said.

Rolfes also cautioned against adding costs to new homes. She pointed to the attempt of Hamilton Twp. to add a $6,300 impact fee to new home construction in 2007. Permits for new housing plummeted from 351 permits in 2006 to 73 in 2011. The impact fee was ruled illegal by the Ohio Supreme Court this year.

“Some of the decline can be chalked up to the overall economy, but the impact fees didn’t do any favors,” Rolfes said.

Rolfes predicted continued modest increase in new home building and construction in the area for the next two years.

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