Monday, May 07, 2001

Hamilton Co. lags neighbors on sales tax revenue

By Steve Kemme
The Cincinnati Enquirer

        County sales tax revenues have fared better in recent months in Greater Cincinnati's growing northern and eastern counties than in Hamilton County.

        In March and April combined, sales tax revenue distributions in Butler, Warren and Clermont counties were higher than for the same two months last year, while Hamilton County's was lower.

        Distributions are made two months after collections; the money counties received last month actually was collected in February.

        At a time when the national economy is shaky, the sales tax revenues in these three largely suburban counties are healthier than in more than half of Ohio's 88 counties.

        In March and April combined, sales tax revenues dropped in 35 counties and remained flat in many others from the same two months in 2000.

        Officials in Butler, Warren and Clermont attributed their relatively stable sales tax revenue streams to the growth in population and commercial activity.

        “Butler and Warren just happen to be two of the fastest-growing counties in the state,” said Tim Williams, Butler's finance director.

        “Right now, that growth is benefiting us.”

        Ohio counties depend heavily on county sales taxes, which are collected by the state.

        Kentucky and Indiana have no county sales taxes, although Indiana counties can charge an innkeepers tax and a food and beverage tax. Dearborn County in Southeastern Indiana has neither.

        Sales tax revenues constitute 25 percent of Butler's general fund budget, 44 percent of Clermont's and 50 percent of Warren's.

        Butler, which has one of the lowest sales tax rates in Ohio, 5 percent, is asking voters in the special election on Tuesday to approve a 0.25 percentage point in crease for the Butler County Regional Transit Authority.

        Sales tax would increase from 5 cents on the dollar to 5.25 cents on the dollar.

        Hamilton County is counting on sales tax receipts to pay for the billion-dollar riverfront renovation.

        The sales tax revenue distributed to Hamilton County last month represented a 14 percent jump over the revenue in April of last year. But the sales tax receipts had declined from a year ago in each of the previous three months.

        Hamilton County Commissioner John Dowlin said it's difficult to predict sales tax revenue because of the two-month lag between collection and distribution.

        “I'm telling our people we should be very cautious in our expenditures and find ways to save money,” he said.

        Sales tax revenues distributed in March and April of this year increased compared with March and April of last year by 5.2 percent in Clermont County, 3.2 percent in Warren and 2.2 percent in Butler, according to figures from the Ohio Department of Taxation.

        Still, the sales taxes of those three counties haven't been immune from the effects of the general economic slowdown.

        “We're not seeing the significant increases we've had in the past,” said Chuck Tilbury, Clermont County's chief deputy auditor.

        “We've experienced up to an 8 percent increase in the last few years. I don't anticipate that happening. But I don't anticipate any significant decreases, either.”

        In two of the past six months, Butler County has experienced decreases in sales tax revenues from a year ago.

        “It's a mixed signal,” Mr. Williams said. “We're still cautiously optimistic that our sales tax revenue will hold.”

        “I'm not overly concerned,” Butler County Commissioner Courtney Combs said. “The bulk of our sales tax revenues come from car sales. Normally, car sales and sales tax revenues increase as we get into spring and summer.”

        Warren County's sales tax revenue has exceeded projections to such a degree that the county reduced property taxes last year by about 7 percent.

        But Warren County Auditor Nick Nelson said there are no assurances that the good times will keep rolling.

        “We keep projecting revenues to stabilize and decline because we anticipate feeling what the rest of the country is feeling,” he said.

        “But that's not occurring yet.”


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