Policy Matters Blog

Tax inequity, job growth and a Medicaid setback: News from Policy Matters

by Policy Matters Ohio on April 29, 2016
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A roundup of happenings at Policy Matters Ohio… Saturday night live – When the Federal Reserve Bank raises interest rates, it often means hiring goes down, wages grow more slowly, and unemployment goes up. There are times when doing so still makes sense but is now one of them? Come to an event next Saturday night (yes, we know) to tell a top decision-maker at the Federal Reserve what you think about them putting the brakes on hiring and wage growth right now. Upside down tax system — Ohioans in the bottom fifth of the income scale last year paid about twice the share of their income in state and local taxes as the richest 1 percent. That cold, hard fact provided by the Institute on Taxation and Economic Policy shows that the wealthiest Ohioans are not paying enough to support public services. (read more)

Still a problem: Foreclosures in Ohio

by Policy Matters Ohio on April 28, 2016
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The number of new foreclosures in Ohio dropped last year, but remains well above previous levels. Foreclosures in Ohio fell 7.4 percent last year to 40,479, according to new data from the Ohio Supreme Court, the lowest number since 2000. The number of new filings at county courts across the state dropped for the sixth year in a row, to well under half the number in 2009. But we still have a ways to go before foreclosures return to what might be considered normal levels (see chart below). During the 1990s, the number of filings averaged 21,075 a year, or slightly over half the total in 2015. The number of foreclosures remains at least double 1995 levels in 73 of the state’s 88 counties and triple that of two decades ago in 42 counties, or almost half of Ohio. (read more)

Band-Aid solutions to state GED failure

by Policy Matters Ohio on April 27, 2016
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In this year’s State of the State, Ohio Governor John Kasich honored Margo Hudson, an adult literacy tutor from Cleveland who earned her GED on her sixth try in 2012. Margo is a lifelong learner and leader. Ohio needs many more people like her, but given the collapse of Ohio’s GED system, you have to wonder how many potential Margos are being left behind. A Policy Matters report in February documented barriers that caused the number of people passing the GED to plummet 85 percent, after Pearson VUE, the world’s largest for-profit education corporation, took over and made changes in 2014. The company tripled the cost to $120; began requiring online registration and test taking; and made the test more complex. (read more)

By the numbers: Ohio earns poor grades in early-childhood funding

by Policy Matters Ohio on April 14, 2016
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It’s great to see more attention focused on early-childhood education. It’s terrific that Cleveland media organizations are partnering on Cleveland Connects: The First 2,000 Days, an initiative focused on the importance of quality preschool. But the numbers tell a story of statewide neglect. Ohio spending on public preschool and childcare is far behind other states. Quality preschool and childcare is unaffordable for many families. Ohio has the means to invest more, but our leaders choose not to. The state has instead given large tax cuts to the wealthy – money that could and should be used to educate and care for our children. (read more)

Wealthy not paying fair share of state and local taxes

by Policy Matters Ohio on April 11, 2016
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State and local taxes support schools, fix potholes, keep the snow plowed, the justice system running and the water clean. Economic prosperity depends on these public services. The wealthiest families benefit amply from our communities and state. But are they paying their fair share for these benefits? New data says they are not. In 2015, average tax filers in Ohio in the bottom fifth of the income scale paid just about twice the percentage of their income in state and local taxes as the richest 1 percent (see figure to the right). That’s according to new data provided to Policy Matters Ohio by the Institute on Taxation and Economic Policy, a national research group with a sophisticated model of the tax system. (read more)

Guest blogger: Here’s why Ohio should leave Medicaid alone

by Policy Matters Ohio on April 8, 2016
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This week, the Ohio Department of Medicaid (ODM) initiated the process of making it more difficult for low-income Ohioans to keep Medicaid coverage. Medicaid was created to provide health care for people who are too poor to afford necessary medical services. It helps them get healthier and with better health, be more productive. It moves people to independence. But Ohio is about to make it harder for Medicaid to serve these purposes. The state budget bill signed by Gov. John Kasich directed ODM to apply for a waiver for the so-called “Healthy Ohio” plan. The plan would shift over 1 million Ohioans enrolled in Medicaid into a new program that imposes premiums on adults earning less than 138 percent of the federal poverty level ($16,394 for a single person without dependents). (read more)

Fair Share is Fair

by Policy Matters Ohio on March 29, 2016
Fair share is fair. That was the finding of an equally divided U.S. Supreme Court, which today issued a one-sentence decision that upheld nearly 40 years of legal precedent and the right of public sector workers to collectively bargain. No worker can be forced to join a union even though the benefits of a union contract extend to all the workers in the bargaining unit. Those workers who do not want to be full members pay a fair share fee. This ensures that such covered employees who receive all of the benefits of union membership pay some of the costs. Fair share covers the administrative costs of bargaining and administering the contract. Fair share fees do not include costs of political activities. (read more)

Regulating short-term rentals a smart move

by Policy Matters Ohio on March 28, 2016
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Earlier this month, Cuyahoga County reached agreement with Airbnb, the residential rental web site, to collect the 5.5 percent county lodging tax. Great news. This levels the playing field with hotels and allows the county to reap needed revenue. Now, the city of Cleveland needs to finish its own ordinance regulating this growing industry. Otherwise such rentals will go untaxed under state law. Such taxes until now have not been easily collectible. While we’re at it, we need to fill gaps in the county agreement, which calls for taxes to be collected but otherwise leaves Airbnb unregulated. Technological advances have led to a quickly growing short-term rental market for temporary housing in cities across the United States, including Cleveland. The leading company in the business, Airbnb, was valued as high as $25.5 billion as recently as last year after only seven years of existence. (read more)

A broken GED, tax breaks run amok, a fracking injustice: News from Policy Matters

by Policy Matters Ohio on March 11, 2016
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A roundup of happenings at Policy Matters Ohio… Epic fail – After the world’s largest private, for-profit education corporation took-over the high school equivalency test known as the GED, the number of Ohioans attempting and passing the exam has plummeted. Our workforce researcher Hannah Halbert detailed the shocking numbers in a recent report: The number of Ohioans passing the test plunged by 85 percent from 2009 to 2013, after Ohio handed the reins to PearsonVUE. The upshot is that 22,000 fewer Ohioans earned an equivalency degree than would have had we kept the normal pace. The collapse not only hurts Ohioans trying to get ahead, it hurts employers looking for qualified candidates. No strings attached – Ohio lawmakers more readily spend state revenue on tax breaks than on vital public services: State giveaways will grow to nearly $9 billion by 2017, and with little accountability, Wendy Patton and Zach Schiller say in a recent report. (read more)

Boom and bust highlights need for stronger fracking tax

by Policy Matters Ohio on March 3, 2016
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Prices at the pump have plummeted and some oil- and gas-producing regions are seeing their economies slow, but Ohio’s Utica region saw growing production in 2015. Fiscal problems of other areas show that Ohio should establish an adequate severance tax, to pay for the costs of rapid industrial development in Ohio’s rural, drilling communities, and to cushion the bust that follows a boom. Natural gas production in Ohio rose by 200 percent in fiscal year 2015 compared to the prior year, and oil production by 130 percent (Figure 1). The slump in fossil fuel prices will not last forever. The Energy Information Administration expects prices for natural gas and oil to rebound in 2017 and rise more in the long run. (read more)