Gene Krebs Testimony for House Bill 153

Every two years the state of Ohio develops a new budget to fund all state activities and many local activities through a variety of subsidies.  In fact the state only keeps 15% of the tax money that flows through their treasury and sends the remaining 85% back to the local governments.  For seventy years the state has been distributing money to local governments without sufficient consideration for cost efficiencies. Greater Ohio has recently testified in the House Finance Committee that Ohio needs better data to understand how to achieve these cost efficiencies .  Better data will be the key in transforming Ohio's communities to become more competitive in the global economy.  Currently Ohio's fractured and duplicative layers of government undercut Ohio's economic competitiveness, and the most important tool to reversing these damaging trends is the accumulation and distribution of better data.  In order for each taxpayer to get the best best bang for their buck, better data is needed to know where and how cut, merge, consolidate or share.

For more information on this topic, read Gene Krebs' complete testimony.  If you're not interested already, here's a direct quote from Gene's testimony, "I can give more data about Kate Middleton’s dress than I can about most Ohio government, state and local."

Building the Ohio Innovation Economy and the National Academy of Sciences

On Monday, April 26th, Greater Ohio attended a symposium on Building the Ohio Innovation Economy.  Co-sponsored by the National Academy of Sciences, University of Akron, Case Western Reserve University, Morganthaler—a venture capital firm—and Nortech—a northeast Ohio technology economic development group—the symposium was held in Cleveland and brought together regional, state, and federal leaders to discuss innovation.  Panelists from federal agencies, private sector companies, think tanks, universities, and philanthropic foundations offered a range of ideas of how to capture, support, and encourage the innovative work being done throughout Ohio, and especially in northeast Ohio. Lavea Brachman, Greater Ohio Policy Center's executive director, provided a state-policy perspective and made the case that the private sector will have to lead the state in innovation—especially in supporting industry clusters as a regional economic development strategy—but that state and local governments must provide the right conditions for the private sector.  In urging for governance reform and strategic investments that can help Ohio lead the next economy, Brachman argued that state policy could be pivotal in clearing the way for growth in interconnected businesses, and that the state should join with local and regional players to create a climate for innovative growth.

From L to R: John Fernandez, assistant secretary of the Economic Development Administration, a sub-agency of the US Department of Commerce; Lester Lefton, president of Kent State University; Lavea Brachman, executive director of Greater Ohio; Ronn Richard, President and CEO of the Cleveland Foundation.

Brachman’s co-panelists pointed to the role the federal government and philanthropy in encouraging cluster development.  As they, and speakers on other panels affirmed, building an innovation economy requires a multi-pronged strategy that knits together and syncs federal, state, local, private and public programs and officials.   Jim Leftwich, the new director of Ohio Department of Development, publicly committed the state to developing and supporting Ohio’s innovation economy.

Greater Ohio is heartened by the idea streams brought together by the symposium and the number of stakeholders who are deeply invested in building Ohio’s innovation economy. We look forward to reform and creation of state policies that can further support this work.

Greater Ohio Executive Director attends American Assembly

Lavea Brachman, Greater Ohio's Executive Director, recently participated in a four day national conversation about cities in transition and the policy and practitioner strategies that can help revitalize and strengthen these places.  “Defining a Future for America’s Cities Experiencing Severe Population Loss”  was convened by The American Assembly, a nonpartisan public policy forum , and co-sponsored by The Center for Community Progress (CCP) and The Center for Sustainable Urban Development (CSUD) at the Earth Institute at Columbia University. Brachman, who served on the leadership team, joined roughly 80 leading U.S. thinkers to begin producing a set of well-defined policy approaches; approaches that will assist cities in stabilizing, “right sizing,” and finding new ways to rebuild their economies and engage local stakeholders.  The outcomes of these discussions will be released in the coming weeks.  For local coverage of the event, see this write up of the Assembly.

In developing federal and state policies that can support cities in transition, Ohio—as a state with many cities in transition—has much to gain from this summit.  Previously, the American Assembly has successfully moved federal and state policy on a variety of issues, such as ways to develop economically competitive metros.  As Greater Ohio has advocated before, federal policy and state policy must reinforce each other if our cities are to compete and thrive in the new economy.  We look forward to learning about the American Assembly’s final recommendations and will be posting them on our website when they become available.

 

Greater Ohio Releases State Budget Response & Local Government Restructuring Toolkit

Greater Ohio applauds the proposed 2012-13 budget for taking a bold first step in challenging local governments to modernize, but cautions that Ohio needs more tools to realize the vision of more efficient local government and to ensure a return to prosperity for Ohio. Recently the 2012-13 State Operating Budget was released in which bold proposals set into motion the streamlining and cost reduction of government operations, especially among local governments.   In a response released by Greater Ohio– The 2012-13 State Budget Response and Local Government Restructuring Toolkit– we agreed that the status quo is not a winning strategy and to move Ohio’s economy into the 21st century, increased efficiency and savings among local governments are needed.

However, to return Ohio to prosperity, budget cuts MUST be combined with strategic and targeted investments; cuts alone will not bring about a climate of prosperity.  Our response recommends legislative adjustments, new pieces of legislation, and the creation of some new state programs and policies to smooth the transition from the existing, antiquated structure of local governance to a modernized one.

We strongly recommend that the 2012-13 budget bill and subsequent legislation incorporate the following tools:

  1. Create a Governance Reform Commission to oversee the modernization of Ohio’s local governments by providing innovative leadership on governance reform, collecting data on local governments to help set efficiency standards, and offering technical assistance for local governments that are merging or initiating other new governance structures
  2. Create a framework for pooling resources regionally to pave the way for robust regional economic development by creating a regional revolving loan fund for needed infrastructure funding and economic development projects.
  3. Make permissive mergers, consolidation, shared services, and alternative governance structures and eliminate any legal and constitutional barriers. This could provide for a merger of city and county jurisdictions that results in consolidated service districts and governance, increased value for the taxpayer and a better business climate.
  4. Develop a protocol for collecting data on local governments’ costs and level of services, like the Cupp report for education, so that the Governance Reform Commission can create efficiency standards, evaluate the performance of local governments, and develop other indicators of performance.

In research conducted by GO and the Brookings Institution, we found:

  • 86 percent of states have fewer governments per square mile than Ohio
  • Ohio has 41.3 local governments per county and the national average is 27.9 local governments per county
  • Ohio has moved from 9th highest in local tax burden to 6th highest among the fifty states, while the state burden has stayed stable at 33rd
  • Ohio ranks 22nd nationally in instructional payroll spending, but its non-instructional payroll is 8th highest nationally (as a percentage of personal income)

It is clear that dramatic measures are needed to make Ohio average.  Reducing and eliminating duplication in services will save money and free up resources Ohio can use to make strategic investments in assets to grow our economy.  Fixing congested freeway interchanges, seeding venture capital investments or supporting anchor institutions have significant multiplier effects that will allow Ohio to realize the Governor’s vision of competing anywhere in the world.  The underlying structure of local government in Ohio must change, and the State should drive this change.

To see our full analysis and a longer menu of policy tools that can be used to foster the necessary restructuring of local government, please see our 2012-13 State Budget Analysis and Local Government Restructuring Toolkit.

 

Greater Ohio Testifies on SB 90

Greater Ohio Policy Center's Senior Director of Government Affairs and Policy, Gene Krebs, recently presented testimony as an interested party on SB 90, the repeal of the estate tax.   Greater Ohio's goal is to illustrate some facts and perspectives that have not been brought out, and also to suggest a formula, that if adopted, could allow for the bill to proceed with a minimum of negative impact for the local governments, and perhaps even be better for them and the citizens in the long run. "Do no harm" is one of the first instructions given to freshman entering the General Assembly. Keeping the estate tax does harm, and abolishing it too quickly also does harm. Greater Ohio is seeking political common sense by giving you two options to pursue, either separately or in common.

Our advice is to reduce the estate tax take by half for local governments, put one fourth into a revolving loan fund for economic development projects that are locally determined and the terms of the loan set locally in a regional frame, and have the remaining fourth placed into a mutual fund pool where the locals determine the formula for aiding communities who are lower wealth, and once again in a regional frame.  Then phase it out over eight years.

To read more of the details from Gene Krebs' testimony, see the full text here.

Sustainable Planning for the Dayton Region

Check out this amazing video from the Miami Valley Regional Planning Commission.

This video explains what sustainable growth is and the importance of sustainable planning in determining the future economic competitiveness for Dayton and its surrounding villages and townships.  MVRPC makes the case that the cost of building new infrastructure on the urban fringe often exceeds the economic contributions new commercial and residential developments bring to the region, and instead Miami Valley’s future health depends on compact, walkable neighborhoods, and reused pre-existing commercial and manufacturing sites.

MVRPC is implementing a new initiative, “Going Places,”  that takes into account better land use, varied housing choices, and a range of transportation options—all which will help the Dayton metro and Miami Valley region successfully compete in the global marketplace.

Columbus on the Record

Gene Krebs of Greater Ohio Policy Center will be a featured panelist tomorrow for Columbus on the Record, a public broadcasting show that features various commentators from the Ohio media and statehouse observers.  This will be Gene’s fifth opportunity to sit for this show. Topics this week will undoubtedly include collective bargaining (Senate Bill 5), the new state budget, and governance reform.  For those of you not in the Columbus media market, the show will be rebroadcast on your public television stations throughout the week so check your local listings.  In addition, you can watch episodes online at Columbus on the Record's website .

NEXT SHOWS: Friday, 4/01, 8:30 pm WOSU TV Friday, 4/01, 10:30 pm WOSU PLUS Sunday, 4/03, 11:30 am WOSU TV

New Interactive Tools

Check out these new interactive tools.  Transportation for America has just released a map which shows which bridges in your area are structurally deficient.  See what it shows about the bridges your neighborhood (if you're brave enough to know).

Forbes has produced an interactive feature which graphically represents inward and outward migration across the country, broken down to the county level.  It shows from where and to where people (with exact numbers) are moving.  Check it out!

Making long-term investments in our Cities and Metro Regions, While Balancing the Budget

By Lavea Brachman. The 2010 census data for Ohio showing many of Ohio's cities shrinking further over the last decade, leaving additional vacant properties in their wake, as well as declining revenues and increasing legacy costs, was disheartening, although not surprising.  Juxtapose these trends with the Kasich Administration’s budget proposal, as local governments grapple with the impact of the proposed cuts on their day-to-day operations, and there is reason to be concerned about how these cities and their metropolitan areas – which are the state’s economic drivers -- will retain a toehold in the next economy.

Looking at European cities – resulting from Greater Ohio’s on-going partnership with the German Marshall Fund – to see what they have done to fortify their cities as economic engines, we are reminded of the need for policymakers to take a longer view. Ohio WILL emerge from this fiscal crisis, and when we do, we want to make sure we have preserved our assets and made critical long-term investments.  Against tremendous odds, the cities of Manchester, England and Leipzig, Germany have begun to prosper, due to many innovative local practices and to strong leadership (to be discussed in a future blog). But one lesson stands out from both cities which is the importance of treating public money as investments and not as subsidies.

Taking this approach, these cities – in partnership with their state and federal government equivalents -- systematically identified areas (both geographic and business sectors) where increased investment could produce the greatest quantitative and qualitative returns over the long-term.  For instance, Leipzig targeted select neighborhoods, using federal-state funding programs to support demolition and rehabilitation in distressed neighborhoods, coupled with other rebuilding programs.  Manchester used innovative public-private partnership vehicles to target and invested in regeneration areas (such as an area called New East Manchester).  Also Manchester aspires to be Britain’s center for digital and related created industries, so it is promoting cluster development with an incubator of entrepreneurial media firms.  Certainly, there are promising stateside examples of making strategic investments for the long-term, even in the most dire of circumstances.

Here in Ohio, we have tremendous institutional assets that we must leverage with smart investments, at the same time that we undertake the necessary cost-cutting measures, such as shared services and consolidation.  Even in this state of fiscal and economic crisis, we need to take a step back and encourage targeted, strategic investments -- in market-ready neighborhoods and leveraging our many and vaunted “anchor” institutions (e.g. universities, medical centers).  Without these investments, our metropolitan regions will be less and less capable of creating the climate that leads to business growth, innovation or produce the exports needed to be part of the next economy.

Interested in learning more?

Join Our Mailing List!