Local Government Fund May Be Reduced

It seems the Local Government Fund may decrease the amount to Townships and Counties. Every community will be impacted by this.This is important to know because it will have an indirect impact on Village finances and a direct impact on services from other local governments. The Dept of Taxation has also taken another look at potential revenues.
Below I have pasted a Legislative Alert from OTA. Below that is the actual letter from the Department of Taxation.





Last month I sent a legislative alert that spoke to reductions in the Local Government Fund due to the lack of revenue in the State's general revenue fund. In that alert I mentioned that the Department of Taxation was revising their estimates for 2009 and 2010 based on new state revenue numbers.

The Department of Taxation has released that information and has posted it to their website. The 2010 estimates have been sent to each county auditor. To view the LGF explanatory document, visit http://tax.ohio.gov/channels/other/services_for_local_govts.stm and look under "Other Distributions." To view the 2010 estimates, please visit http://tax.ohio.gov/channels/government/OhioDepartmentofTaxation.stm
Sincerely,

Heidi M. Fought
Director of Governmental Affairs
Ohio Township Association
6500 Taylor Road, Suite A
Blacklick, OH 43004
(614) 863-0045
(614) 863-9751 Fax





Tax Analysis Division
P.O. Box 530
Columbus, Ohio 43216-0530
614-466-3960
tax.ohio.gov
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2. Calendar year 2010 PLF distribution estimates
Each July, ODT is required to provide each county auditor an estimate of the amount to be distributed
to such county’s undivided public library fund during the next calendar year.1
ODT estimates that CY 2010 distributions from the state PLF will amount to $336.2 million. This
represents a decline of $33.5 million, or 9.1 percent, from the estimated CY 2009 distribution levels.
The amounts are summarized below (shown in millions of $). Note that each county’s distribution is
projected to decline by 9.1 percent in 2010 relative to 2009.
The year-over-year decline in overall PLF distributions is mostly attributable to the reduction in the
PLF funding percentage (from 2.22 percent to 1.97 percent), which affects all 12 months of
distributions during CY 2010 but only affects a portion of CY 2009 (i.e., the last five months of that
year). Another, less significant factor explaining the expected decline is that CY 2010 revenues are
predicted to be slightly below CY 2009 revenues.
July 2009 Revised (July 2009)
Estimate of Total Estimate of Total $ change: % change:
Calendar Year 2010 Calendar Year 2009 Est CY 2010 less Est CY 2010 less
PLF Distributions PLF Distributions est CY 2009 est CY 2009
$336.2 $369.8 -$33.5 -9.1%
3. Calendar year 2009 and 2010 LGF distribution estimates
Because of updated revenue projections, ODT has revised its CY 2009 estimates of the distributions
from the state LGF to the 88 county undivided local government funds. These estimates are slightly
under the CY 2009 estimates issued in June 2009. See below for a summary of the revised CY 2009
and actual CY 2008 distribution amounts (in millions).
Revised (July 2009)
Estimates of Total Total Actual
Calendar Year 2009 Calendar Year 2008 $ change: % change:
Distributions to Distributions to Est CY 2010 less Est CY 2010 less
88 County LGFs 88 County LGFs est CY 2009 est CY 2009
From state LGF $589.1 $687.8 -$98.7 -14.4%
Dealers in
Intangibles 12.6 11.9 0.7 5.9%
Total distribution $601.7 $699.7 -$98.0 -14.0%
ODT estimates that CY 2010 distributions to the county undivided local government funds will be
$577.9 million (excluding dealer in intangibles tax distributions). This represents a decline of $11.2
million, or 1.9 percent, from the estimated CY 2009 distribution levels. The amounts are summarized
below (in millions of $). The decline stems from the extectation of continued weak revenue
performance in the first few months of CY 2010.
July 2009 Revised (July 2009)
Estimates of Total Estimates of Total
Calendar Year 2010 Calendar Year 2009 $ change: % change:
Distributions to Distributions to Est CY 2010 less Est CY 2010 less
88 County LGFs 88 County LGFs est CY 2009 est CY 2009
From state LGF $577.9 $589.1 -$11.2 -1.9%
Dealers in
Intangibles 12.3 12.6 -0.3 -2.4%
Total distribution $590.2 $601.7 -$11.5 -1.9%
1 In addition, updated PLF distributions estimates are to be issued in December preceding the distribution year and in June
of the distribution year. Thus, ODT’s next set of distribution estimates for CY 2010 will be released in December 2009.