Davison worried by HB 5
STEUBENVILLE – City Manager Cathy Davison is expressing her concerns over legislation in the Ohio House of Representatives that may force local governments to relinquish their local tax collections to a state controlled system.
House Bill 5 is set for hearings next week in Columbus.
The legislation, Davison said, will create a uniform tax collection across the state.
“This is another way for the state to take control of municipal governments. It could mean an additional 7 to 10 percent cut in local taxes that we cannot afford. That would reduce our income by approximately $400,000,” stated Davison.
“The proposed legislation will affect Steubenville’s ability to raise revenue through local taxes to provide basic services for our residents and businesses. It could force local governments to give their administrative powers to the state. The bill also allows for the creation of a new municipal tax policy board, require municipalities to offer a five-year net operating loss carry-forward provision for businesses in their communities and restrict municipalities’ abilities to collect back taxes,” explained Davison.
“Our local government funding has been cut in half by the state government. The state has repealed the estate tax and now wants to adversely affect the local income tax collection. We cannot afford another move to reduce our municipal income,” stressed Davison.
“The state government is balancing its budget on the backs of local governments who are now struggling to maintain basic services. The governor wants local governments to centralize their services. But Steubenville is already collaborating with other government entities to save money. Additional cuts to our revenue will make it even harder to maintain basic services,” noted Davison.
She said she has had discussions regarding the legislation with both men who represent Jefferson County.
“Our City Council has previously passed a resolution opposing this legislation. I believe it is time for our local residents to make their feelings known to state leaders and urge this legislation be rejected,” said Davison.
State Sen. Lou Gentile, D-Steubenville, agreed and said local governments already have been forced to make tough decisions.
“We see street lights in Mingo Junction and Pease Township in Belmont County being shut off because of budget cuts. But at the same time the state has accumulated a $1.9 billion rainy day fund,” said Gentile.
“Changing the tax collection process will take local control from local governments and municipalities and give control to the state government. This would be one more significant financial blow to the communities in Jefferson and Belmont counties,” said Gentile.
“The Ohio Municipal League has tried to have a dialog with the sponsors of the bill regarding possible changes. But the legislative language remains the same as it was last year when a similar bill was defeated,” said Gentile.
He also said he will wait to see what final version may pass the House before committing how he will vote on the bill if it reaches the Senate.
State Rep. Jack Cera, D-Bellaire, said he is opposed to the bill.
“I am not in favor of doing anything that will hurt local governments. They have been hurt enough. But the majority leadership is sponsoring the bill, so it may very well pass the House this session. I do know several Republican legislators who are opposing the bill, so I am also holding out hope this can be stopped,” stated Cera.