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Published: Friday, 4/8/2005

House Republicans ready plan that eases local government cuts

BY JIM PROVANCE
BLADE COLUMBUS BUREAU

COLUMBUS - House Republicans are expected to unveil a budget today that will try to ease the pain of the budget ax on counties, townships, and villages, but there will be little help for cities and libraries.

The substitute budget will pick and choose when it comes to salvaging Medicaid and other health programs targeted for cuts by Gov. Bob Taft.

It will also call for complete elimination over five years of the intangible personal property tax paid by business on machinery, equipment, inventory, furniture, and fixtures.

Republicans remained mum on how they plan to pay for undoing some of Mr. Taft's spending cuts or for the resulting $400 million-plus hole created from the expanded cut of the business tax.

The House Finance Committee plans to hold hearings through the weekend with a vote set for as early as tomorrow. The full House plans to send a bill to the Senate next week. A budget must be enacted before July 1.

Rep. Larry Flowers (R., Canal Winchester) confirmed that the House GOP counterproposal will cut in half Mr. Taft's proposed 20 percent cut in local government subsidies for counties. The proposed cut in aid for townships and villages would be halved to 5 percent.

The cut for cities and public libraries, however, will remain at 20 percent and 5 percent, respectively. Free libraries, however, would be authorized to charge fees for some services.

"A lot of folks were concerned about counties," said Mr. Flowers. "Counties do all of our human services work and judicial work. Secondly, we were concerned about those small townships out in the rural areas where a few thousand dollars is a big hit."

Local governments currently receive a share of the personal income tax, but Mr. Taft's tax reform plan would cut personal income taxes 21 percent across the board over five years.

Rep. Chuck Calvert (R., Medina), finance chairman, said the budget the House will send to the Senate will be balanced. But he expects to hear more optimistic revenue projections from the Office of Budget and Management before the budget leaves the Senate.

Tom Johnson, Mr. Taft's budget director, said the state has been meeting revenue projections and that he is optimistic he won't have to deliver last-minute bad news like he did two years ago. But he stressed the next two months are critical for tax collection.

The House GOP counterproposal, hammered out behind closed doors, adopts much of Mr. Taft's tax-reform plan.

The House plan, however, takes Mr. Taft's proposal a step further. In addition to eliminating the machinery, equipment, and inventory portions of the personal property tax as Mr. Taft has proposed, the House plan would eliminate the last remaining portion on furniture and fixtures.

The bill would also:

●Include about $8 million for a Department of Health program that provides medication and treatment for those under the age of 21 with severe medical handicaps.

●Completely fund Medicaid adult vision care, but only partially restore dental care.

●Cap tuition increases at universities and colleges at a flat 6 percent.

Contact Jim Provance at:

jprovance@theblade.com

or 614-221-0496.



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