Policy Matters Blog

Guest blogger: Confronting economic polarization in NE Ohio

by Policy Matters Ohio on August 31st, 2015
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National media has quickly caught on to what we know too well in Northeast Ohio: Many people here have been left out of our region’s nascent recovery. As Cleveland and Northeast Ohio take center stage this election season, the main story aside from the political coverage is quickly becoming “the tale of two regions,” one in the midst of an economic and cultural renaissance and one where entire neighborhoods have fallen seriously behind amid rising poverty, crime and inequality. This tale, of course, has been told before. But suddenly, the whole world is watching. Yes, new industries are forming, entrepreneurship is thriving, jobs are slowly coming back, and those jobs are generally good-paying jobs (hooray!). Yet, many residents—roughly one in 20—throughout the region are increasingly disconnected from the jobs. (read more)

State budget hammers local governments — again

by Policy Matters Ohio on August 24th, 2015
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Ohio’s new two-year budget continues a long-term trend of the Kasich administration and General Assembly underfunding needed services of local government. For the past four years, the state has forsaken its historical partnership with cities, villages and townships. Between cuts in revenue sharing and loss of the estate tax, the state has provided local governments $1.7 billion less in the current, two-year budget than in the 2010-11 budget. That was the last budget in which the historical fiscal partnership between the state and localities was intact. In constant dollars, with inflation accounted for, the loss is more than $2 billion over this time period. Ohio is a home rule state. Services provided in other places by the state are provided locally in Ohio. (read more)

Moving closer to transparency on tax abatements

by Policy Matters Ohio on August 18th, 2015
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Local governments in Ohio and across the country will soon have to start reporting the cost of tax incentives they provide for economic development as part of their annual financial statements. This is a major step forward for transparency and corporate accountability, although the rule doesn’t go as far as Policy Matters Ohio and many other organizations had requested. The Governmental Accounting Standards Board (GASB), which sets financial reporting standards, published a final rule Aug. 14 requiring both state and local governments to report how much revenue was lost to tax abatements for reporting periods beginning after Dec. 15, 2015. Importantly, the rule also requires governmental bodies such as school districts that passively lose revenue because other local governments approve tax abatements to disclose how much that is costing. (read more)

War on blight is money well spent

by Policy Matters Ohio on August 7th, 2015
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After staring death in the face, land banks are still in business to manage and repurpose abandoned properties – a vital function in cities battling blight. Some background: Congress has refused to raise the 18.4-cent per gallon gas tax last raised in 1997. That means America needs new funding sources for roads and bridges. A Senate highway bill last month proposed snatching $300 million from land banks in Michigan, Indiana, Illinois and others. This would have seized $71 million from Ohio’s efforts to demolish blighted homes. Anyone who has recently driven or taken transit through Cleveland knows many neighborhoods still have vacant, abandoned, and dangerous properties in need of razing or renovation. As of the last quarter of 2014, Cuyahoga County has 25,000 vacant properties, says Jim Rokakis, director of the Thriving Communities Institute, a nonprofit combating blight. (read more)

Amy Hanauer: We deserve real talk on debate stage

by Policy Matters Ohio on August 5th, 2015
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Policy Matters Executive Director Amy Hanauer has a piece in The Huffington Post today challenging Republicans debating in Cleveland Thursday to have a real discussion of issues important to Northeast Ohio and beyond. She writes: “In Cleveland, as LeBron says, “nothing is given, everything is earned,” so earning respect here will require something beyond defaming Mexican immigrants as “rapists” (Trump), claiming U.S. foreign policy would march Israelis “to the door of the oven” (Huckabee), or comparing Wisconsin labor protestors to ISIS terrorists (Walker).” Amy goes on to pose three questions raised by Policy Matters research, and examine the candidates’ records for clues on answers. She asks: Will you help incomes and wages keep up with productivity? How will you reverse climate chaos and fix environmental disasters?  (read more)

Why Ohio’s sales tax holiday isn’t such a deal

by Policy Matters Ohio on August 5th, 2015
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The upcoming Ohio sales tax holiday might seem like a good opportunity to stock up on clothing or school supplies: from August 7 to 9, purchases of clothing priced $75 or less and school supplies and instructional materials priced $20 or less will be tax-free. Some of the distinctions between what is and isn’t covered under the holiday, though, are strange. A belt is tax-free during the holiday, but a belt buckle is not. You can buy an athletic uniform tax-free during the holiday, but not sports equipment like cleated shoes or gloves. If you want to get an early start on Halloween shopping, you can buy costumes tax-free, but costume masks sold separately don’t qualify. But aside from such oddities, the reasoning behind this new law is fundamentally flawed. (read more)

The benefits of a graduated income tax

by Policy Matters Ohio on July 20th, 2015
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The Ohio General Assembly has taught us a lesson about the benefits of the graduated income tax. Earlier this month, The Plain Dealer reported  that many business owners would wind up paying higher income taxes for 2015 despite a provision in the state budget bill that significantly expands a tax break for this same group. A spokesperson for the Ohio Department of Taxation called it one of the inevitable “anomalous impacts” that happen when there are changes in the tax code. But while the policy might have been inadvertent, its results were exactly what you would expect when you replace a graduated tax with a flat one: People with low incomes pay more. Here’s how it works in this case: For 2015, the tax break will allow owners to deduct the first 75 percent of their first $250,000 in business income. (read more)

Lawmakers should close loopholes for travel sites

by Policy Matters Ohio on July 13th, 2015
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Have you ever booked a hotel room in Ohio online through a business like Expedia or Priceline? You may be surprised to learn that online travel companies like these get to pay less in taxes to state and local governments for your room booking than the hotel itself would if you had booked directly. Out-of-date state laws governing the state sales tax and local lodging taxes, which don’t account for the recent development of online travel companies, allow them to keep a few extra dollars for themselves with every hotel booking they make. This needs to change—and the issue is getting deserved attention in Columbus. Michael Mazerov of the Center on Budget and Policy Priorities explains why online companies typically don’t pay as much in taxes for a room rental as hotels do. (read more)

Guest blogger: Protecting pregnant workers is a must

by Policy Matters Ohio on July 10th, 2015
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No woman should ever have to choose between her job and her pregnancy. But that’s the choice some expectant mothers in Ohio are facing right now. As a working mom of two young girls, I know firsthand the challenges women face in balancing their career, their family and all of life’s competing priorities. But too many women in Ohio carry an unthinkable burden that no mother should have to bear — pregnancy discrimination. Thanks to inadequate federal protection and no state law, it’s legal in Ohio to deny pregnant women reasonable workplace accommodations that let them work safely as they carry a child. Temporary relief from heavy lifting, being able to sit for a few minutes every couple of hours, or being able to go to the bathroom when you need to are basic things pregnant women need on the job, but all too often do not receive. (read more)

Real predators don’t have fins

by Policy Matters Ohio on July 8th, 2015
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With the media frenzy over Shark Week, it’s easy to forget the real predators lurking in our communities: Payday loan sharks. On average, sharks in the ocean injure 15 people per year, but payday loan sharks bleed $7 billion in fees out of more than 12 million hard-working Americans struggling to make ends meet. All payday loans have a few things in common: Outrageous triple digit interest rates (600% APR or higher in Ohio), steep fees and a deceptive structure that’s designed to keep borrowers trapped in a cycle of debt and desperation for months. Since the 1990’s, Ohio has allowed small dollar short-term lending. Since then, payday lending has exploded. One in 10 Ohioans has had a payday loan. (read more)