3/21/07 Governor's Budget Proposal Establishes New Funding Source for Public Libraries
Under Governor Strickland's 2008–2009 budget proposal, public library funding will remain frozen through the end of calendar year 2007 and receive a modest increase in 2008 and 2009.
From 1993-2001, public libraries received 5.7% of the state's personal income tax revenue through the Library and Local Government Support Fund (LLGSF). In response to a deteriorating national economy and a resulting state budget crisis, the LLGSF was frozen in 2002 and has remained frozen or reduced in every subsequent budget. |
Library Funding Estimates
|
CY 2006 $458 M |
CY 2007 $458 M |
CY 2008 $462 M* |
CY 2009 $464.9 M* |
* estimate |
| |
Gov. Strickland has proposed changing the name of the Library and Local Government Support Fund (LLGSF) to the Local Libraries Fund (LLF) to make clear that the purpose of this fund is to support public libraries.
The proposal also changes the revenue source used to fund public libraries. Since 1985, public libraries have been funded through a percentage of personal income tax revenues. Although the personal income tax enjoyed substantial growth during much of that period, in the budget crisis years, personal income tax revenues plummeted. In addition, legislators found it popular to cut income taxes, which further eroded the base of the LLGSF. Gov. Strickland's proposal broadens the base of library funding to all General Revenue tax revenues, not just personal income tax. This increases the funding source for public libraries dramatically, and therefore reduces the percentage from 5.7 to 2.2.
GRF Tax Revenue (Dollars in Millions) |
| |
FY 2006 Actual |
FY 2007
Actual |
FY 2008 Estimate |
FY 2009 Estimate |
| Auto Sales and Use |
936.4 |
920.0 |
1022.3 |
1061.9 |
| Non-Auto Sales and Use |
6431.9 |
6550.0 |
6817.0 |
7047.6 |
| Personal Income |
8786.4 |
8790.0 |
9148.4 |
9251.9 |
| Corporate Franchise |
1054.9 |
1055.0 |
812.8 |
497.4 |
| Public Utility |
176.2 |
170.0 |
177.9 |
181.0 |
| Kilowatt-Hour |
325.3 |
330.0 |
227.3 |
133.1 |
| Domestic Insurance |
170.3 |
174.7 |
178.4 |
182.5 |
| Misc Business and Property |
19.1 |
19.0 |
19.5 |
20.0 |
| Cigarette |
1084.1 |
1020.0 |
1025.0 |
1005.0 |
| Alcoholic Beverage |
57.5 |
57.5 |
58.0 |
58.5 |
| Liquor Gallonage |
33.4 |
34.3 |
35.5 |
36.7 |
| Estate |
54.1 |
56.5 |
57.8 |
58.3 |
| Commercial Activity |
185.1* |
.0 |
.0 |
.0 |
| Total Tax Receipts |
19563.5 |
19432.3 |
19846.2 |
19806.3 |
*2006 Commercial Activity Tax revenue not used to reimburse for Tangible Personal Property Tax (TPP). Estimates for 2007-2009 assume all money will be used to reimburse for TPP.
Source: Ohio Department of Taxation |
“Public library funding has not grown in years. The new funding source and proposed funding increase for 2008 and 2009 are positive changes for public libraries. OLC will continue to work with legislators and the library community to ensure that funding will be in place to keep Ohio 's libraries strong and healthy.” said OLC President Cindy Lombardo.
The proposed LLF establishes a true revenue-sharing plan with the state, enabling public libraries to rely on numerous tax revenue streams for funding rather than just the personal income tax revenue. In the past, any reduction in the personal income tax revenue had an immediate and immense affect on library funding. Having a broader funding base, as proposed in the LLF, means that tax changes may not have the same drastic impact on public library funding. However, public libraries will be concerned with any and all tax changes that could affect a reduction in the LLF. There will be no changes in the distribution of funds to individual public libraries; the distribution language for the new LLF will remain the same as the equalization formula used for the LLGSF.
“This is the first budget in five years that proposes any growth for public libraries,” said Lynda Murray, OLC Director of Government and Legal Services. “This growth is very modest, and I view this as the beginning of re-establishing a partnership with the state, not the final chapter.”
The budget proposal will now face the scrutiny of the House of Representatives and Senate before the final vote sometime in late June.
