...if (and it's a big if) Senate Bill 5 does slow the growth in cities', counties', libraries' and school boards' personnel spending, that would give Kasich's administration and the Republican-run General Assembly an opening to prune state aid to local governments. [emphasis added]You must read Tom's entire column for the complete argument he makes, but this is not news and anyone who suggests that it is, hasn't been paying attention.
What's this mean to someone like a local city mayor or council member?
It means that
1) the local government dollars the political subdivisions receive are, as we've been saying, endangered but, in Suddes' argument, they are being justified as endangered by the speculation that the political subdivisions can make up the loss for the local government fund money by cutting the personnel-related items they'd be allowed to cut - without any bargaining be allowed anymore - courtesy of SB5)
2) the estate tax dollars likewise remain endangered - although I checked the status of HB 3 yesterday and it appears that it's somewhat stalled for now - and a similar argument might be made to justify the loss of those dollars (because with SB5, local governments can make up the loss by cutting personnel-related items that SB5 would let them cut without having to go to bargaining).
Pepper Pike's local government dollar amount is currently budgeted at $125,000 and the estate tax amount is budgeted at $430,000 out of a revenue-side budget of about $10.5 million (you can see the 2011 budget docs here).
Suddes concludes that there's $7.7 billion that the state wants to cut from the budget that is purely a function of this "downstreaming" to local governments from the state coffers - and that the state is suggesting that localities can make all that up simply by changing what they give personnel, again, courtesy of SB5, should it pass in its current form. He concludes that the temptation is extremely strong:
Any voter naive enough to think a $7.7 billion pot of money won't tempt the Statehouse's budget-balancers must also think it's safe to stand between a mob of gluttons and a plate of Twinkies.Lovely.
If you really want to understand more of this situation, read the fiscal notes for SB5.