Tuesday, March 25, 2003

Butler Co. may raise sales tax

Emergency move would change 5.5 percent rate immediately

By Steve Kemme
The Cincinnati Enquirer

HAMILTON - As counties throughout Ohio brace for more state funding cuts, the specter of a Butler County sales tax increase is looming again.

County Commissioner Courtney Combs acknowledged Monday that it's "more likely than not" that he and his two fellow commissioners will enact an emergency sales tax increase this year. The increase could be as little as a quarter-percent and as much as 1 percent.

Butler now has a sales tax of 5.5 percent, a half-percentage-point lower than those in nearby Hamilton, Warren and Clermont counties.

"What the state does to us will trigger it," Combs said of the possible sales tax increase.

The basis for his pessimism about further state cuts stems from a meeting of the County Commissioners' Association of Ohio that he attended in Columbus last week. The meeting was about legislative issues, including state funding.

Counties have been afraid the state will reduce or eliminate the Local Government Fund, which provides $15 million a year to Butler County. Butler keeps $5 millionand distributes the rest to townships.

"I don't expect the state to eliminate the Local Government Fund," Combs said. "That would be too devastating to too many counties. But I do expect them to cut it."

Elimination of that fund in July would cost Butler $2.5 million this year, about 3 percent of its general fund, said Robert Lowery, assistant county finance director.

"When we put together the 2003 budget, we assumed we would get that money," Lowery said. "It's really iffy right now."

In anticipation of possible elimination or cutting of that funding, the commissioners have asked county department heads and officeholders to submit plans for a possible 3 percent cut in funds for the second half of this year.

An emergency sales tax increase would take effect immediately. But it could be overturned by a referendum in the November general election.

Still, the county would collect about $7 million on a half-percent sales tax increase approved in July and repealed by voters in November.

More than a year ago, Commissioners Mike Fox and Chuck Furmon voted to raise the county sales tax by a half-percent for major road construction and other economic development projects. Combs voted against it.

A successful referendum effort caused the commissioners to rescind the tax increase before it went into effect.

But Combs said a sales tax increase enacted because of a financial emergency would have a much better chance of withstanding a referendum than the previous one did.

"There was a lot of vagueness about what would be funded in the last sales tax increase (attempt)," he said. "This would be a choice of a sales tax increase or a cut in services. It would be a black-and-white issue."

Additional state funding cuts with no sales tax increase, Combs said, would force the county to reduce staffing, including the sheriff's deputy patrols, as well as its offices' hours of operation.

"We do not have any cushion for any kind of cuts," Combs said.

E-mail skemme@enquirer.com

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