Hamilton County commissioners are scheduled to vote Monday on a levy option to fund Children's Services. A committee that reviews all county levies has determined Job and Family Services (JFS) needs the levy to generate $144 million annually to continue to provide base-level, mandated services. Commissioners have indicated they won't be putting forward a levy that would generate that amount.
The deadline to approve a levy proposal for the November ballot is 4 p.m. on Wednesday, Aug. 5. Five public hearings were held in the lead-up to Monday's planned vote.
The board has more than a dozen potential options to consider, ranging from the recommended 6.57 mill levy to two-year and four-year options at varying millage rates that would all generate less than $144 million.
Commission President Stephanie Summerow Dumas and Commissioner Denise Driehaus both say they're looking for an option that will be palatable to voters.
"I'm trying to make sure that the people in Hamilton County can pay the least amount of money to make this happen, to make this levy happen, said Summerow Dumas. "If this does not pass, it will be a tragedy for not only the children, but also for Hamilton County, because then we have to take money out of our general fund to supplement."
"I want to support a levy that is as low as we can go for the taxpayers, but still funds basic mandated services to keep kids safe and to help them thrive in this community," said Driehaus.
She said she supports a 5.61 mill levy option that would provide about half of the funding the agency needs, and says she likes the stability a four-year levy cycle provide, though she hasn't made any final decisions yet.
The lower funding plans will require using some one-time funding sources and finding new revenue streams, and/or identifying further possible cuts in order to fill budget holes.
Job and Family Services has a new director, John Nelson. Driehaus said she's spoken with him about finding additional operational efficiencies and expects he'll be part of the conversation "to be very aggressive about those efficiencies moving forward."
Stadium sales tax
Commission Vice President Alicia Reece has called for using the stadium sales tax fund or borrowing against future sales tax earnings to supplement the Children's Services levy revenues.
"I'm for children, and that's why I say we should take the stadium sales tax, and we need to borrow against the future. And then, when it's their [the sports teams'] time, then go to the ballot," she said during a Tuesday staff meeting discussion.
At Thursday's regular meeting, she added, "There is a mixed messaging that when it comes to stadiums and billionaires, we tend to get creative, and we fund them long-term, and we put it together where they never got to really come back to the voters. But when it comes to our children, we say we want to do stuff for our children. We love them, but then we put the burden on the homeowners who are already struggling."
A staff report from the county's attorneys and bond counsel says taking funds from the stadium sales tax would violate state law.
"Due to bond indenture requirements, there is no near-term ability to repurpose, or reposition, the riverfront Sales Tax Fund to focus primarily on anything other than stadium assets. That is, at least until all debt is retired, it would not be feasible to alter the primary purpose of the fund while debt service has senior priority," the report states.
Reece rejects that report, saying attorneys she's spoken with have told her otherwise.
"They said it was 'primarily.' No, I'm not saying it's going, all of it, be used for that. But they said because of 'primarily,' that means that it does open up for even a portion. Even Willie Cunningham said it. He's a lawyer. That opens up a portion [that] can be used because the word 'primarily.' Primary use?, yes for stadiums, but that doesn't mean a portion can't be used for something else."
The memo also concludes borrowing against future sales tax revenues to fund children's services would be illegal.
"Ohio law prohibits the use of long-term debt to finance recurring operating expenses. There are limited exceptions where, for instance, short-term notes may be used to address a temporary cash-flow gap when tax revenues authorized by a levy are expected to be received later in the fiscal year (e.g. Tax Anticipation Notes). That, however, is not what is being considered in this case."
The county also uses part of the sales tax revenues to fund the property tax rebate (PTR) promised to voters who approved the stadium sales tax in 1996. Poor revenues have led to many years — across multiple boards of Hamilton County commissioners — choosing not to fund the PTR, or only partially funding it.
Earlier this week Reece called her ideas "creative" and said the county administration only seemed to be willing to be creative when it comes to funding stadiums.
"Everything I come back with you say is illegal," she said.
She then left the Tuesday meeting early after scolding county staff members
"I'm gonna adjourn myself from this conversation because we done got out of line and out of control, and I don't want it to go that way," she said before leaving the Tuesday meeting.
At Thursday's meeting she suggested the county should consider new bond counsel.
"Maybe we need a different bond counsel company. Maybe we don't need to do the same people because we need some new, creative ways to put the taxpayers first. We need a new creative way to put the homeowners first," she said.
Lack of state funding
The commission is unified in one area: anger with the state and state legislators for not providing enough funding to local communities for the services local agencies are required to provide. According to a previous report from the Tax Levy Review Committee, the average amount a state contributes to child welfare is 42%. Ohio ranks second lowest at 18%.
The agency has already made $36 million in reductions to help deal with a budget shortfall created by a rising number of kids in the system, and increased costs of care. Other cost-saving measures underway include: looking for changes to the intake model; placing more children in kinship care rather than traditional foster care or residential homes; maximizing reimbursements; reviewing levels of care to ensure they're balanced; identifying non-mandated services; and lobbying state leaders to provide more support.
The state of Ohio is also reviewing its rate card, which sets rates for levels of care across the state, so it's unclear how changes there could positively or negatively affect the JFS budget.
Hamilton County already leads the state in the number of children placed with family members — the least costly option — rather than foster care or residential centers.
"Hamilton County is the forerunner in the state of Ohio, with 36% of kids going into kinship care, the highest of any of any of the urban counties," said Lisa Webb, assistant county administrator.
All three commissioners have expressed concerns about the growing tax burden on voters, and what can be done to help. Once this decision is made, Driehaus said she wants to have a broader conversation about all of the levies the county manages.
"We've got seven levies that we have authority over, that we have control over, and we need to think about restructuring all seven so that ... we live in this new reality, [a] challenging climate for property taxes, yet needs in our community that need to be addressed, many of which are mandated, and so that's the position we find ourselves in," she said. "I am looking forward to ongoing conversations about that."
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