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Finances under fire

January 10, 2013
ROBERT A. DEFRANK - Staff Writer , Times Leader

ST. CLAIRSVILLE - Belmont County officials answered several concerns Wednesday from guests regarding cuts to public services. A meeting last week resulted an announcement that more than 10 positions would be abolished from the Department of Job and Family Services.

Commissioner Charles R. Probst Jr. said a savings of $1 million had to be made by the end of the fiscal year on June 30. He added that the DJFS director projected that Human Services may be cut 4 percent yearly until 2020.

Commissioner Ginny Favede added that other factors include the possibility that Medicare and Medicaid may be administered at the state level.

Article Photos

BELMONT COUNTY Auditor Andy Sutak answers questions about the impact of state cuts to local government and the options
to benefit from oil and gas interests. Pictured along with Sutak are Frank Papini, United Steelworkers member; Frank Shaffer and Mark Cervelli, Pultney Township trustees; and Clarence Briggs.

T-L Photo/ ROBERT A. DEFRANK

"There are a lot of unknowns at this point," Probst said. He added that the commissioners had worked to cut costs while keeping as many people working as long as possible until there was no other option but to abolish jobs.

Favede said that another 25 percent cut of local government funding is expected this year. This includes cuts to libraries, schools, and municipalities. Visiting trustees from Pultney Township voiced concerns that services such as snow removal and road repair will suffer.

"There may be a balanced budget at the state level, but he's balancing his budget on the backs of local government," said Favede, adding that local governments have, in turn, been forced to increase levies, and the taxpayers ultimately footing the bill. "It's an evil system. It all comes back to the taxpayer."

"It seems there are more and more that need the services and less and less money to serve them," said Richard Hord, visitor. "It appears that the governor is using counties such as Belmont to balance the state budget at our expense."

Frank Papini, a guest and member of the United Steelworkers, asked about oil and gas interests and inquired when the county can expect to reap benefits. He voiced the opinion that it was unfair that a county that was producing such resources was facing heavy cuts to services.

"It doesn't make sense that we're making cuts in services and personnel, and we're sitting on a gold mine," he said.

Probst said the private landowners were the most immediate beneficiaries, whether because of drilling, contracts or pipelines. He added some refineries are expected to be built, and activity has picked up on the Ohio River.

Favede said the state's plan involved public benefits from oil and gas interests to go into a severance tax and redistributed to state residents as an income tax reduction. She added that the Belmont and nine other host counties have petitioned for the return of some funds to offset local expenditures. While the county has an ad valorem tax extraction tax, it would not see a benefit until a year after the oil and gas was out of the ground. At this point, there are about six active wells.

Auditor Andrew Sutak was invited to answer questions and explain the state system and its local impact. He said many villages, townships, park districts and such entities receive local government funding from the state, and that funding has been cut by 50 percent. In addition, personal property tax from area businesses has been done away with. Further, the deregulation of utilities in the 1980s also meant a loss in local funds.

The state had included a statutory requirement to reimburse communities for the loss of personal property and public utility taxes, but that has now been cut while monies collected from cap and excise taxes are remaining in Columbus.

Sutak said senior services, MRDD, mental health, the general fund, and the children services levy have all seen cuts.

The county has seen an influx of oil and gas interests and an increase in sales tax as visitors purchase goods and services locally.

"That's one side that revenues are on a plus," he said. "I'm hoping more new businesses come in."

Sutak noted other factors. He said the three petroleum products the county taxes are natural gas, liquid gas and oil. The demand for natural gas is in high demand on bad winters. The demand for liquid gas is year-round. If oil is struck locally, there is a possibility that a refinery might come to the county.

But money brought in from interest rates has decreased from $2 million to $600,000

"We gained here, we lost here," Sutak said.

He agreed that there is considerable interest in the area's natural resources, and the groundwork of infrastructure is being laid, but the operations are not here yet.

"Things are slowly getting better. We have a lot of things coming." he said.

When production begins, the ad valorem tax will go back to those areas that are producing gas.

Sutak said that Columbus benefits from the state severance tax on well permits and volume produced, but the local government and the township roads utilized by the companies receive nothing.

"We fought this," he said, adding that he had approached state officials and suggested the ad valorem be made a current tax. He has also circulated petitions.

"Our political subdivisions, our commissioners, councils, township trustees, directors of some of the departments, they're handcuffed. They're relying on our local tax base to survive," he said, adding that service departments have continued to diversify in an effort to save costs. "They've cut our tax base. They've cut our local government funding."

DeFrank can be reached at rdefrank@timesleaderonline.com.

 
 

 

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