Fiscal Note & Local Impact Statement
127 th General Assembly of Ohio
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BILL: |
DATE: |
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STATUS: |
SPONSOR: |
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LOCAL IMPACT
STATEMENT REQUIRED: |
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CONTENTS: |
To allow a subdivision that is a member of a regional transit
authority to withdraw from the authority |
·
No
direct fiscal effect on the state.
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LOCAL
GOVERNMENT |
FY 2007 |
FY 2008 |
FUTURE YEARS |
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Regional Transit Authorities |
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Revenues |
Potential loss in |
Potential loss in |
Potential loss in |
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Expenditures |
Potential decrease in
service costs |
Potential decrease in |
Potential decrease in |
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Other Local Governments |
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Revenues |
- 0 - |
- 0 - |
- 0 - |
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Expenditures |
Potential decrease in
transit authority tax payments to RTAs |
Potential decrease in |
Potential decrease in |
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Note: For most local governments, the fiscal year is the calendar year. The school district fiscal year is July 1 through June 30.
·
While
a subdivision withdrawing from a Regional Transit Authority (RTA) would
possibly decrease the service costs of an RTA, it is uncertain as to whether or
not that decrease would offset the loss of transit authority tax revenue. Presumably, this calculation would vary
jurisdiction by jurisdiction, depending on the operating costs that would be
saved by the eliminated services compared to the amount of the tax revenue that
would be foregone.
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Regional Transit Authority Process
The
bill permits any county, municipal corporation, or township that has created or
joined a Regional Transit Authority (RTA) to withdraw from the authority by a
new procedure that does not exist in current law. Under the bill, the legislative authority of the political
subdivision proposing a withdrawal must adopt a resolution to submit the plan
to the voters of the withdrawing territory, and certify the proposal to the
board of elections to be put on the ballot at the next general election, or at
a special election conducted on the day of the next primary election. If the proposal is approved, the withdrawal
will be effective two years from the date of the certification of the passage
of the proposal.
Fiscal Effect
If,
by a popular vote, a political subdivision opted to remove itself from
participating in a regional transit authority, the RTA would experience a loss
of revenue received from the taxes collected from that political
subdivision. This includes any ad
valorem or sales and use taxes that it was authorized to levy and collect
within the territory of the withdrawing subdivision. The Department of Transportation has indicated that there are
regional transit systems in Cuyahoga, Franklin, Lake,
Montgomery, Summit, Portage, and Stark counties that currently levy regional sales
taxes to finance their transit systems.
The transit authority would also experience a decrease in costs
since it will no longer be providing service to the withdrawing local
government. It is unclear as to whether
or not the decrease in service costs would offset the loss of tax revenue, but
these impacts would likely vary depending on the circumstances.
The bill requires the board
of trustees of the RTA to ascertain, apportion, and order a division of the
funds on hand, to the withdrawing entity.
The power of the transit authority to tax the withdrawing entity would
also be terminated, except for any payment of any indebtedness within the
withdrawing territory, as it existed at the time when the indebtedness
occurred. Therefore, the withdrawing territory
will still be responsible for its portion of any debt incurred before
withdrawal, but can no longer be taxed for its portion of the operational costs
of the transit authority.
LSC fiscal staff: Terry Steele, Budget Analyst