Let’s Talk About…Solutions for Ohio (Part 3)
BY LIZZIE MARGOLIUS
In the previous two articles, we addressed Ohio’s tax and spending issues. We spoke about a perfect storm with continually increased spending, declining population growth in most of Ohio’s counties, and the state’s overall tax burdens. In this article, we will propose some solutions.
First, Ohio needs to address the 60 declining counties. Continually building up the Columbus metropolitan area does nothing for the entire rest of the state. The City of Columbus continues to grow beyond its current bounds through annexation and new development opportunities to put more money into the pocket of Columbus, but what about the rest of Ohio? The argument for developing in Columbus is mainly the access to infrastructure and an airport. But if Columbus is the only area primed for major development, then guess what? The rest of Ohio (minus Cleveland and Cincinnati) will see little development. It’s time that Ohio puts money and interest into the counties that are depopulating; whether that’s improving brownfields in once thriving, now desolate towns, or building another airport to service other Ohioans and businesses. It’s never been wise to put all the eggs in one basket, so why not diversify and decentralize Ohio’s future across the state?
Next, Ohio needs to re-evaluate its state incentives for luring companies to come here. Many companies who come to Ohio are using multiple incentives and it’s not helping Ohio. For example, Intel was not only given almost $2 billion in taxpayer money, but then also awarded a 30-year property tax abatement, not to mention all the federal taxpayer funds. Given all the incentives though, Ohio still isn’t drawing businesses at the same rate as states like Florida and Texas. Why? Two reasons: income tax, and right-to-work. The businesses attracted to Ohio, like data centers, don’t create many jobs and are in total conflict with Ohio’s culture and values, not to mention a huge drain on resources. (See Massive Data Centers Provided (Further) Massive Tax Breaks, Ohio Data Centers Are Becoming A Growing Pain, Not Just Tax Dollars: Big Data Is Out For Ohio’s Water, Too )
Ohio also needs to re-evaluate its tax burdens. Being ranked 9th highest in the nation for overall tax burden is not something to be proud of, especially when many Ohioans are struggling to make ends meet (due to our lower median income). Income tax needs to go, property taxes need to be addressed, local taxing jurisdictions need to be reorganized, and wasteful spending needs to be reined in at both a local, and statewide level. For those of you who argue with me on this, then explain to me how Florida can have zero income tax, a lower gas tax, a phased-out property tax, similar sales tax, but Ohio can’t? The argument made is tourism. Fine, then how does Tennessee have zero income tax, a lower gas tax, property tax rates that are half of Ohio’s, and a slightly higher sales tax rate? FYI: Florida has the 4th largest state economy. Ohio has the 7th largest state economy, but Ohio spends double per capita to Florida. It’s not all tourism, folks… it’s revenue vs. spending. When you lower your tax burden, guess what happens? Your state grows, thus solving our depopulating counties crisis.
Lastly, Ohio needs to rein in its spending! Taxes can’t be lowered without either lowering spending or increasing the population. The state’s general revenue fund is increasing at a rate of about 5% a year, while population growth has been mostly stagnant. Ohio politicians need to wake up to the crisis of perpetually increasing spending with a stagnant population. Eventually, even the Republicans will run out of other people’s money, so kiss lower taxes goodbye!
Ohio is in a vicious cycle: A declining population with overspending leads to higher taxes. If you break one, you break the cycle and put Ohio on a path to successfully attracting people and businesses to the state, while reducing the tax burden and bringing in more revenue. Who knows, maybe eliminating property taxes will be the very catalyst that breaks Ohio’s vicious cycle.
