Butler County services at stake if sales tax fix isn’t found

The Ohio Senate did not vote on the House override of the governor’s veto of millions of dollars worth of Medicaid Managed Care Sales Tax revenue Tuesday, but the interested parties plan to negotiate.

Butler County stands to lose $3.1 million worth of sales tax the federal government has abolished. Local officials implored their state legislators to create a permanent fix to the untenable situation and the House did just that in July.

RELATED: Butler County officials implore legislators to help with sales tax issue

For six years, Ohio applied a sales tax to premiums charged by managed care organizations operating under Medicaid. The tax generated approximately $850 million for the state and $210 million for counties and transit authorities. The Kasich administration proposed in the budget a different fee that would replace $615 million a year for the state but left out the counties and transit authorities. The governor vetoed a plan to generate an additional $207 million in money for transit authorities and counties.

The $3.1 million budget hole — and some hefty capital bills, like about $10 million for replacing Motorola public safety communication equipment and $3 to $6 million for new voting machines — has Butler County officials very concerned about balancing the budget for 2018.

County Administrator Charlie Young said he certainly hopes state legislators and the governor can come to terms on a deal that makes the counties and transit authorities whole.

“It doesn’t seem unreasonable that if there is a fix that can be had, the parties involved would try to get to it,” Young said. “I’m certainly hopeful that it would make us whole for these losses, because it will have a very significant impact on our ability to provide services and meet the demands of our citizens.”

In all, the House overrode 11 of the governor’s 47 vetoes to the 2018 biennial budget. The Senate confirmed six of the overrides Tuesday.

John Fortney, spokesman for the Senate President Larry Obhof, said there are talks going on between the County Commissioners Association of Ohio (CCAO) and the Kasich administration to determine if something can be worked out. If those talks break down, Fortney said the item likely will be on the Senate agenda Sept. 6.

“The idea is give it two weeks, good faith negotiations, see what the results are of that between the administration and the county commissioners of Ohio, with the idea of having something is better than having nothing,” Fortney said.

He said part of the reason the legislators want to work something out with the governor is there is no certitude the federal government would approve the plan — although it has sanctioned the state’s fix to the funding loss.

“Even with an override passing there is no guarantee that the federal government would approve the replacement plan for MCO tax,” Fortney said.

Under Kasich’s original spending plan, Butler County would have received $2.1 million in one-time transitional money.

RELATED: Butler County recoups some sales tax

Butler County Commissioner Don Dixon said at least there are talks going on about the issue.

“I don’t think it’s bad,” Dixon said. “It would have been bad if they said ‘No, we’re not doing it.’ There’s an opportunity here to work something out, so we’ll see how it goes.”

State Sen. Bill Coley, R-Liberty Twp., said there was strong support in the caucus for overriding the veto, but the Senate leadership thought it was prudent to wait.

“There was some discussion about whether or not the Senate leadership could work with the administration and see if some middle ground could be found that would help out the local governments,” Coley said.

Cheryl Subler, managing director of policy for the CCAO said a meeting has been set for next Wednesday when some legislators, transit authorities, representatives from her association and the Kasich administration.

“Senator Obhof has agreed to take two weeks to see if there are any additional ideas that could be explored to address the revenue replacement for the counties and transits, before taking possible action on the veto override,” Subler said.

RELATED: Butler County facing challenging budget for 2018

Commissioner T.C. Rogers, who is the liaison between the CCAO and the commissioners, said he will offer any help he can to help the association come up with a solution. If one can’t be reached though he hopes the senators will keep their promise to affirm the House override.

“I hope they will work it out…,” Rogers said. “If they can’t we are relying on our elected legislative members to do what they say and vote to override on the 6th.”

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