POMEROY — As a follow-up to Monday evening’s public meeting on the state budget proposed by Gov. John Kasich, the Meigs County Commissioners approved a resolution during Thursday’s weekly board meeting urging legislators to take action to protect counties against the loss of Medicaid Managed Care Organization (MCO) sales tax revenue.
As it stand, Meigs County would loose more than $550,000 in annual sales tax revenue unless something is put in the budget to offset that loss.
The Sentinel previously reported that the MCO sales tax will come to an end this year in accordance with federal regulations, therefore, impacting the sales tax revenue for both the state and local governments in Ohio.
As stated during Monday’s meeting, the proposed fix to the sales tax loss at the state level is to institute a fee on services which has been approved by the federal government. That fee will not offset the loss to the counties or local governments.
Instead of a permanent fix for the counties, the state is currently proposing a one-time lump-sum allocation which covers the revenue for a specific time frame. While that would offset the tax loss short term, the commissioners and others are asking for a long-term solution.
The resolution passed by the commissioners will be sent with a letter drafted by the board to Kasich, Lt. Gov. Mary Taylor, State Rep. Ryan Smith, State Rep. Jay Edwards and Speaker of the House Cliff Rosenberger. After the initial letters are sent, the commissioners stated they plan to send copies of the sale resolution and letter to all the members of the Ohio House of Representatives and the Ohio Senate.
The letter to Edwards states in part,
As you know, the looming changes to the Medicaid managed care (MCO) sales tax will cause a significant revenue shortfall for the state, counties and transit authorities. In 2016, this tax represented $209 million (8.2 percent) of all county and transit authority sales tax collections.
Permissive sales tax revenue represents over 50 percent of the county general revenue fund and is the lifeblood of important public safety and child protective services — two areas where needs are growing due to the opiate epidemic.
Counties value our partnership with the state, which allows us to administer programs that serve our collective constituents. However, the disparate treatment contained in this proposal undermines the fiscal stability of county revenues.
Similar action to that taken this week by Meigs County has been taken in other counties around the state.
Additionally, Commissioners Randy Smith and Tim Ihle are expected to attend a second County Commissioners Association meeting on Monday in Chillicothe regarding the MCO sales tax loss.