MCO sales tax loss fix in final budget

Budget heads to Governor for approval

By Sarah Hawley

POMEROY — Word came on Thursday morning of a potential victory for Ohio’s 88 counties and eight transit authorities, as the final version of the state budget to be presented to Gov. John Kasich includes a fix to the Medicaid-managed care organization (MCO) sales tax loss.

While counties had been bracing for the loss, which in Meigs County would have been 10 percent of the county’s operating budget, local officials had remained hopeful for a solution, reaching out to legislators and the governor’s office.

During Thursday morning’s weekly commissioner meeting, Commissioner Randy Smith said that they commissioners had received word that the “Dolan Amendment” was in the final version of the budget which had been approved by the conference committee.

“We are grateful not only for our local representation but for the senators and the state reps from the other districts that have fought hard to keep this amendment in tact. A special thanks to Senator Dolan. We are prayerful that the governor will see the importance of this, see that it doesn’t impact the state’s waiver and leave it in the budget to allow us to continue business as usual,” said the commissioners after hearing of the amendment being included.

Meigs County stood to lose approximately $574,000 annually, while Gallia County was to see a loss of $592,650 annually.

State Rep. Jay Edwards (R-Nelsonville) said in a phone call with the Sentinel on Thursday afternoon that the amendment had been something that he and others had been working on since early on in his term when he became aware of the situation.

Representatives working on the solution to the loss initially could not find a fix, but continued to look at the options. Eventually the math worked out to find a fix, but it will require approval from Washington D.C., Edwards noted.

The amendment requires that the governor’s office go through the Center for Medicare and Medicaid Services (CMS) to negotiate an adjustment to the franchise fee on health insurance corporations. Edwards was optimistic that the waiver would be granted.

The proposal would raise an estimated $207 million to be distributed to affected counties and transit authorities if federal approval is granted.

The memo states that payments equal to counties’ Medicaid-funded managed care organization sales tax receipts collected during 2015 and 2016 would be distributed after July 2018. According to the memo, the amendment also retains a transition aid originally contained in the budget bill that offers a one-time payout based on counties’ revenue dependence.

The administration previously negotiated with CMS on a fee which made the state budget whole from the sales tax it was set to lose.

The negotiation on the franchise fee would not impact the waiver already approved for the state, something that was of concern from the governor’s office according to the County Commissioners Association of Ohio memo. The memo encouraged local officials to contact the governor’s office to ask that the amendment be left in the budget.

The amendment was introduced by Sen. Matt Dolan, but was ultimately left out of the version of the budget which was approved by the Senate last week.

With the amendment not in the version of the budget submitted by Gov. Kasich, the House of Representatives or the Senate for conference committee consideration, it was unlikely that it would be in the version of the budget ultimately sent to the governor for approval.

Edwards explained that typically an item must be in at least two of the three budget versions in order to make it into the final version.

Knowing the importance of the amendment to restore the funding to the counties, Edwards said that the went to the conference committee and spoke to the importance of the amendment, as well as a school funding adjustment which helped the schools in Meigs County. Both matters made it into the final version.

The amendment, as with any of the items in the budget, is subject to a line item veto by the governor leading up to the budget deadline on Friday night.

Edwards said that the members of the house are making themselves available in early July should it be necessary to vote to override the veto of the Dolan Amendment or any other items which may need to be addressed.

In order to override the veto of the governor, both the house and senate must have a three-fifths vote, meaning 60 votes in the house and 20 in the senate.

Overrides are often difficult due to the issues typically being along partisan lines, and is at a time when it can be difficult to get legislators back to Columbus due to the holiday and vacation plans.

Edwards said there was little to no doubt that there would be enough votes to override the veto on the Dolan Amendment should it happen.

Overall, Edwards called the budget a “balanced budget and a good budget.”

It includes opiate addiction treatment options, as well as school funding which is good for the area.

Edwards explained that in the initial budget Eastern Local Schools was to see a slight funding decrease, while Meigs was to see a small change in funding and Southern was to see an increase one year and a decrease the next. Now, none of the area schools will lose funding over the next two years, with Meigs to see around a $100,000 increase over the two years, and Southern to see an approximate $141,000 increase next year.

The budget now awaits the signature of Governor John Kasich who will have until late Friday to consider the bill.
Budget heads to Governor for approval

By Sarah Hawley