Township losing estate revenue
- Published: June 21, 2012
Like most other local government offices, Miami Township is currently in the process of tightening its budget for the 2013 fiscal year. As a result of reduced state and local funds, the Township will need to decide how much to rein in the general fund, which is expected to lose nearly 12 percent of its budget this year, and then sustain another 12 percent in cuts the following year. The trustees plan to discuss the budget at their meeting this Monday, June 18, and possibly schedule a budget work session before voting on the numbers after a public hearing scheduled at their meeting on Monday, July 2, at 7 p.m. at the Township offices and fire house on Corry Street.
The Township expects to spend about $10,000 over revenues for the coming year, according to Township Clerk Margaret Silliman this week. According to Silliman, the Township enjoys the fortune of having close to $400,000 of cash in the estate tax fund. The township formerly earmarked most estate tax income for farmland preservation. But in 2011, in anticipation of the Ohio legislature’s decision to eliminate the estate tax, the Trustees voted to stop funneling estate tax revenue to the preservation fund, which was spent down to nearly zero last year. Since then, the Township received several windfalls from estate tax revenue, which will cease when the state law takes effect at the beginning of 2013.
“The estate tax fund hasn’t changed any of our obligations” to keep operating costs down, Township Trustee Chris Mucher said this week. “We’re choosing to be fiscally responsible, and we have no intention of putting a levy on the ballot.”
The Township’s $125,000 general fund budget supports the salaries and benefits of the elected officials, including three trustees and the clerk, as well as the operation of the Township office and some subsidies for the road fund, which sometimes needs support beyond its own revenue stream, Silliman said. But the general fund budget has shrunk by about 25 percent over the past several years, according to Mucher. Ohio’s budget bill cut the local government funds, which supply about 50 percent of the general fund revenues, by $13,000 this year and are expected to decline by the same amount next year, he said. And investment returns have been dropping from an annual $11,000 five years ago to about $1,100 this year. Meanwhile insurance and equipment costs have been on the rise. And last year was the first time in two decades that the Township dipped down into deficit spending by several thousand dollars.
So when Road Superintendent John Finn announced he was retiring this spring, the Trustees did not refill the position and now have just one full-time road employee, Dan Gochenauer. The Township plans to hire personnel for snow plowing and lawn mowing on an as-needed basis. And the Trustees put the Township Zoning Inspector on an hourly wage instead of salary, hoping to shave more costs. In addition, part of the trustees and clerk salaries are now paid from the road and fire funds.
The Miami Township Fire-Rescue department is self-sustaining with the revenue from its own fire levy, which brings in approximately $625,000 annually. And while that department had a carry-over of $150,000 from last year, the excess funds are already earmarked for new equipment needs, including $80,000 to replace aging SCUBA gear and $62,000 to leverage a state grant to complete a mandatory radio system upgrade.
The Township road department, which is supported by vehicle license, gas and road and bridge taxes, is also generally self-sustaining with little change expected, Silliman said.
In Silliman’s view, the elimination of the estate tax is the most drastic change in the budget, and Miami Township is fortunate not to have depended on that tax to support essential operations. But other townships around the state have not been so lucky and will feel the effects of the cut more deeply, she said.
“Other townships who use the estate taxes for operating funds — this is going to bury some of those entities,” she said. “But we’re eking through. We are not in fiscal crisis.”