Portune's alternative proposal for new jail tax

August 21, 2006

MOTION

Amend Property Tax Resolution to Convert Property Tax Reduction to a Sales Tax Reduction

I MOVE that the attached Resolution be amended to convert the proposed property tax reduction to a sales tax reduction

_____________________
Todd Portune

Statement
As it stands the existing proposed plan would reduce property taxes for a select group of county taxpayers at the expense of the majority who do not own real estate. It amounts to a massive shift in the tax burden onto the backs of children, the poor and the middle class. It creates the likelihood of opposition to the proposal at the polls.
The goal of keeping taxes below the rate of inflation is commendable and can be met a different way that avoids this problem. By converting the reduction to a sales tax reduction all taxpayers benefit.
Moreover, this change also addresses a key complaint voiced by supporters of the jail. The property tax reduction proposed will benefit those absentee landlords who are contributing to blight and crime in neighborhoods. We should not give a tax break to the very people who are compounding the crime that communities are fighting.

Portune's Ten Year Plan to Rebuild Hamilton County

ReBuild Hamilton County Ten Year Plan
A Draft Discussion of "Next Steps" in Light of Recent Population Statistics and the International Economic Development Council (IEDC) Presentation


By Hamilton County Commissioner Todd Portune

Executive Summary
Last week two major reports converged before the County Commission in the form of the International Economic Development Council ("IEDC") Report and recent census figures on population loss. Both items detail challenges and opportunities for Hamilton County in three distinct areas: Housing, Economic Development/Job Creation and partnership with the City of Cincinnati in the downtown basin [including Over-the-Rhine "OTR"].
In response to these Reports I propose that Hamilton County embark on a ten year leadership agenda in these three areas. This document, together with its action items and supporting documents, forms the basis to begin a ten year plan that I have styled as the "ReBuild Hamilton County Ten Year Plan" leadership agenda. In it I propose steps we can take that will lead to:

1. 10,000 new homes constructed in the next decade

2. Condo Conversions in the downtown and Over-the Rhine

3. Renewing the County Campus proposal to complete the OTR transformation south of Liberty, pave the way for the northern half redevelopment and complete the Pendleton area improvements
4. Provide major support for small business facility improvements, employee benefit assistance for small business and the working poor
5. Generate a $20 Million to $110 Million economic development investment tool for businesses and community/neighborhood business districts – especially targeted to the First Suburbs Communities
6. Coordinate and leverage existing and planned investments in community public works projects
7. Promote business retention, expansion and relocation within Hamilton County by designating Hamilton County as Ohio’s investment Capitol
8. Provide support for the major employee benefit of health insurance in ways that promote small businesses
9. Create a new vehicle that will lead to over $1 Billion of targeted investment in impoverished areas of Hamilton County;
10. Create a new vehicle that will lead to business growth and expansion and new job creation in the most impoverished areas of Hamilton County

After circulation of this proposal to public officials, business , civic and community leaders, financial institutions and experts, homebuilders, realtors and real estate investors, I suggest that we convene a summit of such leadership – no later than the end of September 2004 for the purpose of finalizing the approach and tools that allow for this aggressive effort to move forward.

Each of the items can be accomplished as a stand alone measure. However, done collectively, we can dramatically impact the direction our county is going. To do so will require a concerted and dedicated effort by all. It will require the action of local municipal and township leadership, county officials and the private sector. Daunting as the task may be it is what the public wants us to do. Republicans and Democrats; East-Siders and West-Siders; Urban and Suburban; Labor and Management; Black and White; Rich and Poor; Male and Female – all of us working together for a common vision and a common purpose. The next ten years are critical. Let’s get started.

A. New Housing Construction, Housing Redevelopment and Condo Conversions:
Professor Zane Miller commented over the weekend of June 25th that nothing short of the construction of 10,000 new homes would make a dent in Hamilton County’s population loss. I believe he is correct. Accordingly I am calling upon the public leadership of the county, including county officials and the elected and development leadership of each of our 49 jurisdictions, to rally behind the charge to construct 10,000 new Homes in Hamilton County over the next decade. Coincidentally there are 100 neighborhoods in the county [52 distinct neighborhoods in Cincinnati and another 48 villages, cities and townships throughout the county]. Accordingly, to implement such a plan amounts to building 100 new homes in each community. Obviously there are some jurisdictions that may want more and others that may want less, but the point is the total to be constructed amounts to roughly the amount suggested per community.

In order to build that many new homes we must identify the structure by which this will be accomplished and the tools we will need to create to get it done. We already have a head start in this area because of improvements that have been made over the past few years. They are:


The County’s changed MSD sewer repair policy.
Commissioner Heimlich and my repeal of a decade’s old policy that improperly neglected sewer repairs in the older urban areas of the county. By changing that and beginning a new MSD capital program that is more equitably repairing sewers in the older combined sewer areas we are making those communities more attractive to live in and to invest in. Accordingly, we can leverage those improvements with a strategy that prioritizes those areas where sewer repairs are underway for new housing construction.


The county’s Home Improvement Program.
This effort, begun just two years ago, has already produced over $10 Million in private investment improving the aging housing stock of the county. It is time to revisit the program to determine if changes to it will aid in further improving the county’s aging housing stock. With two years of experience we should have a better handle on what aspects of the program are working well and what areas could be improved. Our ability to turn around population loss is largely dependent on making available the kind of housing choices that people are attracted to. One key area for consideration involves the lifestyle and choices desired by empty nesters and aging boomers. Homes that have accessible features, few or no stairs to deal with, easy to get to cabinets, closets, bath features and the like are the wave of the future. A housing improvement program tailored to meet that need will help set us apart and become more attractive place to live.

Revise the County’s QUEST Policy that links sewer improvements and tap in fees for new home construction.
The county presently has a program known as "Quest" that was established in the mid 1990’s to link an increase in sewer tap in fees to support new sewer extension into areas for new home construction. Approximately $4 Million dollars of MSD ratepayer funds are allocated for this purpose. A minor revision to that program will assist in underwriting the goal of constructing ten thousand new homes throughout Hamilton County. The MSD Assessment Policy is currently under review for revision and enhancement. One of the proposed revisions involves taking one million dollars a year of the QUEST allocation to tackle new sewer construction to replace individual septic systems in areas that pose environmental health risks and hazards. I would propose refining that proposal further in the context of these goals. To link the environmental neighborhoods or communities to our goal of constructing new homes. In other words, in each of the areas where we would redirect QUEST dollars for new sewer construction to address environmental health hazards, we would also look to those neighborhoods as priority areas for new home construction consistent with this goal. To the extent we are able to recapture new revenues produced by economic development measures described below, those dollars will underwrite costs to defray expenses of new home construction. This way we are able to leverage the work and improvement that is taking place in the individual communities in ways that will enhance our dual and mutually beneficial objectives of improving the environment, eliminating health hazards and enhancing economic development and new home construction for the purpose of retaining job and population base of the county.

Revise the HIP Program to Spark Condo Conversions.
One of the opportunities in the downtown and Over-the-Rhine areas of Hamilton County, and in the urban business district areas of the other 98 communities of the county, involve converting apartment buildings to condominiums. The county’s Home Improvement Program that has already leveraged over $10 Million of private investment in improving the aging housing stock can be re-tooled to spark condominium conversions. We have substantial added capacity in that program to do so. Each community could identify its target goal of condo conversions and mount a campaign linked with the availability of the HIP program [as refined] to encourage private investment and redevelopment of apartment housing or loft-convertible buildings to condos.

Enter into a Compact With the HomeBuilders Association of Greater Cincinnati
A long term effort such as this necessarily requires a strong partnership to develop with the industry that will be primarily affected by it. Attached to this document is a draft Compact for local leadership to consider in connection with the HomeBuilders Association of Greater Cincinnati. The Compact establishes the ground rules for a mutually beneficial relationship. The Compact must also assure that as we move forward with meeting the goal we do so responsibly and protective of the areas sensitive environmental features of hillside instability, stormwater detention and prevention and greenspace preservation – all as deemed important and desirable as expressed through the county’s Regional Planning Partnership and Community Compass process. With the goal of 10,000 new homes also comes the potential that other opportunities beyond that minimum goal will develop. We encourage that to occur as the market will bear.

Review and Revise Building Codes and Zoning to Meet New Housing Market Demands.
The built-out urban areas of the county are filled with older homes that may be unattractive for reasons beyond lack of closet space and the like. At the same time they include lot sizes that, when coupled with existing building and zoning codes, make for difficulties in addressing the next wave of lifestyle building. What I am referring to are the needs of an older population given foreseeable physical limitations and their impact on housing choices.

I found this out this past year as I dealt with my own disability. Steps, bathrooms, counter tops, cabinets etc. all posed difficulties in simply getting around and enjoying our house, much less being able to use it. The consequence was a conclusion that we had to sell our home and build. The problem we then encountered was a real eye opener – to wit: the inability to be able to build a home in the city that would accommodate our needs because of either lack of lots, or lot sizes that, when coupled with existing zoning, would permit the kind of single level construction we desired.

With every difficulty though comes opportunity. I believe the kind of issues I faced are those that more and more of the "boomers" will face in the future and we need to prepare for that potential. A community that is able to address the kind of lifestyle choices people will want in their homes is one that is better equipped to prevent population drain and co0nvert that into population gain. A housing summit with consumers and providers around these issues that target changes that can be made will produce results that help us retain our population as people grow older and the general demographic and family unit "profile" changes and it will also enable us to compete for those who are looking for that kind of lifestyle but are not finding it in their local communities. The coupling of homes that fit that lifestyle with the assets the County already has in the form of arts and entertainment, recreation, parks and leisure facilities, cultural and sporting attractions combine to make the county an attractive place for people to stay.

B. Enhancing the Downtown and Over-The-Rhine environments:
The preliminary recommendations of the IEDC outlined the tremendous opportunities the county has by taking an active and a leadership role, in partnership with the City of Cincinnati, with respect to enhancing and improving the environment in downtown and in particular in Over-The-Rhine. Hamilton County has already taken many significant steps that are enhancing our ability to improve the downtown area, solidify it as an economic engine and create new housing opportunities. Among those steps are the county’s lead role in defining and then implementing the Convention Center expansion program and enhancing the Convention and Visitor’s Bureau mission in funding; completion of the Eastern Corridor Land Use and Transportation Plan together with its transportation linkages into the downtown transit center and taking the lead role through the County Transportation Improvement District toward identifying the funding streams to implement the program; changing the approach to major public works projects in the form of completing the Great American Ballpark on time and under budget thereby reducing the demand on limited sales tax resources and taking significant steps toward remedying the current riverfront financial difficulties in order that the Banks project may be jump started, expedited and completed; annual funding of the Greater Cincinnati Port Development Authority and the Partnership for Cincinnati USA.

The IEDC specified Over-the-Rhine as a key and primary opportunity. In fact the IEDC recommendations are almost on all fours with the previously supported, but presently tabled, County Campus program. That program of course was a way for Hamilton County to invest in its primary seat of operations in the northeast section of the Central Business District and the southeast corner of Over-the-Rhine and the sphere of influence of those operations in the portions of the Downtown area. It also involved the county taking charge of the main street connector between the county’s primary seat of operations and the county’s central riverfront improvements and facilities therein.

Accordingly, I propose that we revisit the County Campus program and begin taking the steps that were outlined and recommended for approval and support in December, 2002. By doing so, the county, in partnership with the Downtown and Over-the-Rhine communities in the City of Cincinnati, will serve as the catalyst for completing the redevelopment of Pendleton, sparking the complete turnaround and redevelopment of Over-the-Rhine to Liberty Street south; enhance, solidify and secure the arterial connections from Over-the-Rhine to the central riverfront along Main Street, with a potential expansion of the same to Sycamore and Broadway; serve as a catalyst for private sector contributions to improve the "Avenue of the Arts" areas of Main Street to 12th and 12th from Sycamore to Central.
Downtown and Over-the-Rhine also provide numerous opportunities for home ownership in the form of condominiums and condominium conversions. As discussed in greater detail above, the county’s existing Home Improvement Program should be evaluated for the purpose of revisions that will enhance it as a tool to spark condo conversions in the downtown area in such a way as to spark.

C. Job Creation and Economic Development:
The IEDC offered several recommendations to the County Commissioners that, if followed, will allow the county to take a leadership role in the region in spearheading improvements in economic development and job creation. The IEDC recommended that Hamilton County is uniquely situated of all parties within the region to provide leadership, leverage, and support and chart a direction for growth and prosperity.

We have already begun that process. The Regional Planning Partnership and Community Compass effort, supported by the IEDC as an important and necessary step to the road of recovery, has begun the process of bringing the many jurisdictions and players together around a broad common vision and common purpose. The effort has accumulated vast materials, resources and data to help us chart the correct course. It has also created a sense of cooperation and collaboration among necessary parties that must be in place if we are to move forward ahead as a region. We now must take the information and use it wisely and constructively, and we must also leverage our efforts and resources with our other partners including the City of Cincinnati in concert with 3CDC, the Port Development Authority of Greater Cincinnati and others..

We have also taken a variety of other steps that will enhance our ability to make improvements in the area of economic development. The changes in Metropolitan Sewer District policy that occurred over the last year equally help new business development as they do housing development. Those areas that are unattractive for environmental reasons of raw sewage discharge are also unattractive for investors looking to invest their capital into businesses, whether they are existing ones or new ventures. By improving the sewer system throughout, we are enhancing the ability of the older urban areas including Cincinnati and the first suburban communities to become attractive places for investment capital to locate.

We have created and maintained a Port Development Authority that has been recognized as an important tool and vehicle to broker necessary players and dollars for significant new economic development projects. Commissioner Heimlich and I created a new $2 Million dollar economic development fund for the purpose of providing capital for those programs, efforts or business ventures that will produce a guaranteed return on investment in positive ways for this county. The county’s Home Improvement Program creates options and opportunities to assist in business growth and development.

And last, we have made significant strides in balancing the tension between the government’s need for resources and the citizens’ desire to reduce their individual burdens. Over the past three years we have kept spending $50 Million below the budgeted amount, allowing us to increase our "rainy day fund", reduce the size of the government and reduce the county portion of citizens’ real property tax burden. We instituted an audit process of Board controlled operations that identified solutions that will produce $17 Million a year in additional savings. We have identified steps that will enable us to reduce real estate property taxes by another $25 Million a year. We adopted Budget Goals that will ensure that spending and taxes will be kept at rates at or below the rate of inflation. These fiscally conservative approaches to the county’s finances will serve us well in positioning Hamilton County as a competitive and attractive place for people to invest, work and live.

All of these things have laid a foundation for important and necessary next steps that will greatly enhance our development posture. In order to advance our ability to spark a renaissance of development in Hamilton County that will improve our posture for business growth and expansion and with it the promise of more and new and better paying jobs we must now be creative, bold and willing to take significant steps. Among those steps we need to take are as follows:

1. Create a county-wide Port Development Authority.

Whether it is expanding the jurisdiction of the existing Port Authority or creating a new one, the fact is a Port Authority with county-wide authority makes sense and should be created and implemented post haste. The outstanding issues are whether it should become a new entity or an expansion of the existing one. The exact powers including primarily eminent domain authority need to be carefully discussed and debated but a decision made in a timely fashion.

2. Link Economic Development Opportunities, Business District Improvements and the like to Communities where the MSD Improvements are Taking Place. Tremendous momentum can be generated by the combined linkage of these public works improvements which are enhancing the quality of life and improving the environment and public health in communities along with new housing construction as previously discussed and economic development initiatives. A combined effort, momentum and positive energy generated by those 3 measures moving forward together in a community will be infectious, will improve property values, will no likely spark a new development and entrepreneurial spirit within the communities that are being positively affected in that fashion. It is common knowledge that home improvement programs or repairs in a neighborhood, typically result in anywhere from three to five other individuals fixing up their homes based on the momentum that just the one generates. A similar extrapolation can be made with respect to entire communities from these efforts.

3. Implement the $2 Million Economic Development Fund and Oversight Body.

The $2 Million dollar economic development fund that we created this year needs to begin working in earnest. One element of that is the establishment of the oversight committee that will judge projects, make recommendations and assist in assuring that the county gets a rate of return on its investment. Accordingly, the general outline that is attached of the Economic Development Oversight Commission should be put into place, the commission appointed and work begun in earnest. In addition to that we should revisit the $2 Million dollar fund concept with an eye toward: a) making this an annual investment by the county commissioners at the rate of $2 Million dollars per year; and b) trying to create a vehicle where the funds granted are recaptured and recycled time and time again. The net effect of this would be a program that produces not just $20 Million dollars over ten years for economic development purposes, but one rather where $110 Million dollars could conceivably become available for economic development purposes by the tenth year. The coupling of our $20 Million to $110 Million Economic Development Fund with the $50 Million in Federal Tax Credits secured through the efforts of 3CDC will create incredible energy and opportunity for job creation, business growth and expansion.

4. Strengthen the Hamilton County Development Company.

The IEDC recommended that the Development Company be given a greater ability to do its job. That can be accomplished by giving it additional tools to utilize. These include without limitation the Economic Development fund discussed above; considering it for conversion to become the county-wide Port Development Authority; or creating new investment vehicles as discussed above and below. The net effect of these types of improvements and the development of new tools to be used and meted out by the development authority will be to enhance its stature, structure and ability to perform.

5. Declare Hamilton County the Investment Capitol of Ohio.
Aside from being an important way to "brand" or market the region, we should also take substantive steps to distinguish Hamilton County and set it apart from all other Ohio counties as THE PLACE in Ohio where retaining, expanding or relocating businesses is a priority. Accordingly, I propose that the county repeal the county portion of the Personal Property Inventory Tax on all new investments and investment driven purchases of personal property which would include new investments that are a necessary component of retaining business, expanding existing businesses or having businesses relocate within Hamilton County from outside Hamilton County. That simple measure when coupled with other tax reform measures which are underway in the county, will greatly distinguish us from other communities. Moreover, it will help set us apart from other counties within our region that are developing at such a rate that there is no way that they can maintain their present tax structure.

The demands on the counties around us for infrastructure, sewer, police, fire and emergency medical response, and the like, is such that all of those jurisdictions will be raising taxes or raising fees and raising rates. [for example many are discussing implementing "impact fees" to cover the cost of growth] We, on the other hand, are well situated due to our budgeting, tight controls on spending and fiscal budget goals to reduce our expenditures in ways that allow for reductions in taxes to occur. Accordingly, as others around us increase the overall tax burden on their residents and businesses we in Hamilton County will be reducing taxes across the board for our citizens – corporate and individual alike. The net effect of these reform measures should greatly enhance our environment as an attractive one in which businesses will remain, expand or relocate.

6.Revise the Home Improvement Program (HIP) to Support Small Business.
The HIP program was originally developed to support investments in improving the aging housing stock in Hamilton County. To that end it has been successful having produced over $10 Million dollars in private reinvestment in improving older homes throughout the county. We have an opportunity to revisit the basic structure of the program to develop an additional enhancement to the program to support small businesses that own property. Many such properties are in need of technology enhancements, façade improvements or other repairs that will make them more attractive properties in general. The more fit properties are for their intended purpose the better suited they will be for stabilizing businesses, business districts and business growth. We should earnestly revisit the HIP program and make such changes as will allow for the program to be used to support small business retention, growth and expansion

7. Implement Revisions to Health Care Support that Address Small Business Concerns around Health Care as an Employee Benefit.
The final element in the area of job creation and economic development involves providing those specific enhancements that will support small businesses within Hamilton County and at the same time target investments and dollars into those businesses, those communities and those individuals who need it the most. In particular, I am referring to the working poor of Hamilton County and to the many small businesses that are the backbone of the county in terms of work and work on the job creation and the potential for job creation.

One area where small businesses are impacted the most and where employees, especially the working poor, are hurt the most is in the area of health care. There are in excess of sixty thousand Hamilton County residents who have no health insurance whatsoever. Businesses that offer health insurance as a benefit struggle with the high cost of providing it as a benefit to employees notwithstanding the direct and positive relationship to health care benefits on reducing employee turnover; increasing employee morale; increasing productivity, and the like. The high cost of health care also deprives small businesses of access to necessary working capital in order to be able to expand their businesses or serves as a deterrent to the business’s ability to hire and/or retain qualified employees. In any event, the issue of healthcare has a significant impact on the local economy in a negative way.

Hamilton County is separately exploring the concept of publicly supporting the delivery of healthcare in our county in one form or another through as many as five separate special levies. Under separate analysis we are going to take steps to Create a New Health Care Review Commission. A part of that review will also include an overview of the county’s public support of healthcare and whether a different approach will produce better results for perhaps less money.
There is the opportunity for the dual benefit of reducing taxes and getting a greater delivery of healthcare to our local community. One concept that could be studied in the mix of this would be a way to address the uninsured problem in the county. Such a measure would need to be very carefully evaluated under the criteria that it impose no additional or incremental public cost to this community and that it provide access to needed healthcare in ways that are better than the current delivery and accessibility system. At the same time, there is the potential that such a program, if it works under the criteria just articulated, would also be a strong generator of support for small business in which case it would work as an incentive and an aid to business retention, expansion, growth and relocation within the county. From an economic development perspective, exploring this issue carefully and prudently could lead to a recommendation that produces significant dividends that improve the health of our citizens and enhance the economic health of our businesses and community.

8. Target over $1 Billion of Economic Reinvestment in Hamilton County’s most Needy Communities.
A second element of job creation involves targeting resources to those areas of our community where a direct economic infusion into businesses and jobs will produce results that enhance the economic stability of people and neighborhoods. Again, this is a concept that could be very carefully and prudently studied. It should only be pursued if it is a concept that will produce measurable results without an incremental cost to the public and without being structured in a way that is offensive to, and therefore will not be utilized by, business.

Having said that, the concept is as follows:
Businesses in Hamilton County collectively receive billions of dollars of public money from multiple sources. Many receive money in the form of grants of public dollars, tax abatements, and direct procurement under contracts with public entities. What I propose that we study is a scenario by which any business that is a recipient of public dollars in one form or another, must, over the life of the program, contract or abatement under which the business receives public dollars, purchase a like amount of goods or services that it would otherwise need in its business from a vendor of such goods or services that is located within and hires from within, identifiable areas of the county that have been targeted under a socio-economic matrix to be developed.

In other words, there are communities within our county [see attached county maps, Appendix item 1] where citizens face a tremendous challenge due to issues of poverty, low educational attainment, lack of transportation, etc. The goal here is to create economic opportunities through investments in businesses that exist in impoverished communities by directing the purchase of needed goods or services from qualified vendors that are located in those areas. It is a way to target and recycle public dollars time and time again into the neighborhoods and communities of the county that need it the most. These would have to be businesses that provide quality goods and services that are needed by the companies getting the public assistance. The businesses would not be required to pay a penny more than they otherwise would pay for those goods or services. What would occur is, at no incremental cost to any business, we would generate over a billion dollars of targeted reinvestment overnight into businesses in the communities that need it the most.

By virtue of our targeting those businesses would be strengthened and solidified, their ability to grow and expand would be greatly enhanced and their ability to hire local individuals at decent wages with benefits would also be greatly enhanced. In other words it is a way that we can, on our own, reinvest in ourselves, into communities and into people in positive ways that will provide a great jumpstart toward addressing issues of poverty in our county. The Health Alliance is poised to demonstrate real leadership in this area [see May 19, 2004 correspondence from Ken Hanover of the Health Alliance] and voluntarily commence such a program that will lead to annual purchases of goods and services it needs from qualified vendors that are doing business in Hamilton County’s most impoverished communities in amounts equal to University Hospital’s annual take from the county Indigent Care Levy. In real terms their leadership would yield, over a five year Levy cycle, a $200 Million targeted cash infusion into local businesses in impoverished communities. That is just one example. The opportunities for us, all working together, to take a real bite out of poverty in our county are tremendous.

Attached to this summary of key steps for rebuilding Cincinnati, is an appendix of materials and a series of action item documents for the County Commissioners to address. These action item documents take the form of motions or resolutions for us to act upon. They provide the materials that are ready for deliberation and for vote that get us on our way.

I am proposing that this proposal circulate among our areas leaders for review and critique. Most of the features contained herein have already been discussed, at some level, with most. For example, I have explored the concept of being able to target reinvestment dollars in our county’s neediest communities with leaders such as Ken Hanover of the Health Alliance and Michael Fisher of the Chamber of Commerce. Both have expressed opinion regarding the potential for such a program. Both appropriately expressed a desire that such an effort advance in ways that are viewed as positives by business and not as impediments. The kind of analysis that will allow that to occur comes next, and must come next, for in order to work these measures must be embraced, not resisted, by business.

On that note, a central component of what has been proposed is that none of this costs the public anything more. In fact, what I propose costs less and should reduce taxes across the board. It simply is a reflection of my basic business philosophy – that we can do more with less. We must conservatively try to maximize every ounce of good out of every dollar that the public generously bestows upon us. Too often government spends the public’s money only once and then hopes that other good things will happen. That is both wishful thinking and a poor investment strategy. On the contrary, as stewards and fiduciaries of the Public Trust we must do better by planning and targeting ways in which dollars can be recycled time and time again we should not only get better results from each dollar but we should be able to reduce the total amount that we need.

Thank you for your consideration of these materials. These proposals are not mutually exclusive, nor do they necessarily all have to happen. They do however lay out a basic foundation for Rebuilding our County through specific steps that will enable us to expand businesses, create jobs, improve neighborhoods and therefore strengthen families and people. I thank you for your consideration of this and look forward to hearing from you and to answering any questions you may have. Most importantly I look forward to us working together to move the process ahead. Our county deserves no less.

Respectfully submitted,


Todd Portune
TBP/ld



APPENDIX
Hamilton County maps based on socio-economic indicators.
Hamilton County County Campus proposal reports and recommendations.
Proposed compact public entities and Home Builders Assn. of Greater Cincinnati
Health Care Review Commission memorandum and document.
County Home Improvement Program Brochures
Metropolitan Sewer District Quest Executive Summary Report; Hamilton County General Health District Environmental Hazard Areas; proposed MSD Assessment Policy Revisions
Hamilton County Economic Development Fund Review Commission Criteria
Hamilton County Board of County Commissioners adopted budget goals
Hamilton County Community Development Block Grant funds/funding summary, availability and eligibility by community summary.
Proposed county tax abatement policies and goals.

Portune proposal to improve public health

MEMORANDUM

To: Commissioners Phil Heimlich and John Dowlin
From: Commissioner Todd Portune
Date: June 23, 2004
Re: Creation of a New Health Care Review Commission and Explore the Possibility of eliminating the lack of health insurance in Hamilton County

Dear Phil and John:

I write to you to discuss the important issue of Health Care in Hamilton County and to ask for your consideration of two specific proposals that can dramatically change the face of health care in our county in ways that will promote public health, small business, the uninsured and taxpayers. The proposals are as follows:

Create a New Health Care Review Commission:

First, I believe we need to take a different look at how we are spending and investing public money in health care. The dramatic rise in costs and requests upon us in the form of Special Levies is such that is likely not sustainable in the future. Aside from the potential increase in cost or taxation comes perhaps a far more important question – namely, if we had it to do all over again would we spend the public’s money the way we are doing so today?

I believe we need to ask that question and to do so in a way that allows for a thorough examination of all issues and in a time frame that is free from the demands and constraints that the levy process places upon us.

Accordingly, I propose that we create a new Health Care Review Commission of no less than 5 nor more than 9 Members. We need to have a good cross section of disciplines represented on the Commission. It naturally should include Members of the health care community from all angles – providers, insurers, consumers and public officials. I propose that we ask for Prosecutor review regarding the establishment of such a Commission and the legality of using unallocated health care levy dollars to underwrite its expense. We should answer these questions by the first of November to allow for a thoughtful appointment process thereafter.

The Commission should be appointed at the end of this year and charged to convene next year with the intent of delivering a year end report to the Board that becomes the blueprint to guide the Board’s decisions on health care related levy requests beginning in 2006. The Commission should receive full county administrative staff support and legal assistance from the Prosecutor’s office. Funding for the work of the Commission should come from available and existing levy funds.

I have already had discussions of this concept with Ken Hanover of the Health Alliance in April and with Chris Finney, Chair of the county TLRC in May. Both are favorably inclined toward the concept.

Hamilton County taxpayers have a history and record of being generous in the field of taking care of those least able to care for themselves. We owe our taxpayers the duty to critically examine how those dollars are being spent and whether improvements can be made in the efficient and effective use of them. It may be that an entirely different way of utilizing and distributing dollars is recommended. or it may be that the current model is in fact the best. I do not know and express no opinion other than the opinion that we owe it to our citizens, our taxpayers and the success of our Mission to critically examine this issue with the help of the best minds available on the subject.

The Potential to eliminate the Uninsured in Hamilton County:

As we move forward toward examining the overall question of health care and public dollars I would like for the county administration to evaluate the possibility of using existing and available dollars to eliminate the critical health care problem of the uninsured in Hamilton County. It is possible that we can develop a program in the county that provides for health insurance of one sort or another for our entire population at no added cost to county taxpayers.

I would like for this concept to be reviewed preliminarily by county administration so that it may be an element of the Health Care Review Commission’s evaluation and, if it is deemed worthy, could be a part of the levy recommendation for 2006 insofar as how we utilize public levy health care dollars.

First, a bit of history. When we adopted the work plan and approved the contract on how the Indigent Care hospital levy proceeds would be divided between, and spent by, University Hospital and Children’s Hospital Medical Center, advocates such as Eileen Cooper Reed of the Children’s Defense Fund and Trey Daley of Legal Aid urged that a portion of dollars should be reserved for Medicaid outreach and enrollment. It was left that we would do an annual assessment and review of the levy expenditures with an opportunity to revisit the issue. That review has yet to be done. However, an examination of existing expenditures is very revealing and demonstrates that the expenditure of a small portion of available levy dollars will increase exponentially the benefit that those dollars will be able to provide.

The vehicle to do this is Medicaid. Medicaid is the federal health insurance program that is available to people based upon income and federal poverty levels. It is a program, nonetheless, that requires an eligibility assessment and enrollment.

In Hamilton County there are 17,863 Medicaid eligible people that are not enrolled. Of that figure are 12,874 children and 4,989 are adults. It is calculated that area health care providers lose $55,303,848.00 in Medicaid reimbursements each year. Of that figure $15,784,791.00 is lost by area hospitals for inpatient care in the form of un-reimbursed charity care. Charity care that is not reimbursed is, of course, the criteria for sharing and distribution of the county’s indigent care levy dollars.

In 2003 approximately $1.3 Million of the CHMC allocated Hospital Levy dollars were not used and returned. They have not been spent but are, for want of a better word, escrowed for the moment. According to research done by Trey Daley and Keith Melson of the Children’s Defense Fund, approximately the same amount of dollars would underwrite a Medicate enrollment program that would eliminate the Medicaid gap.

Closing that gap then reveals a picture of Hamilton County’s uninsured. They constitute 13,548 children and 60,854 adults. Under a model program involving Hamilton County’s working poor[defined as those wage earners not eligible for Medicaid and earning less than 200% of the federal poverty level, totaling 35,793 adults], and county businesses that currently offer no insurance, a 3 payer program could be developed to eliminate the uninsured working poor in our county. For the cost of $1.00 each to business, insured and county, a health insurance program could be developed that would generate an incremental $26,625,600.00 to hospitals for services. The amount available for other care providers has yet to be determined.

Such a program produces a $1.29 rate of return for hospitals for every $1.00 invested. When coupled with the new revenues generated by a Medicaid outreach program, as discussed above, the combined new revenues generated to offset existing charity care mathematically covers the cost of the insurance program. I would ask that our administration work closely with providers and with Mr. Daley and Mr. Melson to explore this concept and report to us this year so that the possibility of such a program could be examined by the Health Care Commission when it commences its work next year.

I also ask that such a review occur as it was contemplated under the discussions the Board had in 2002 because, regardless of whether an insurance plan discussed above could actually be realized, the Medicaid outreach and enrollment program makes sense under any analysis.

Thank you for your consideration of these items. If you concur we can begin the process of giving the administration the proper instruction to begin work in both of these areas.

Sincerely,

Todd Portune

Cc: David Krings; Rob Seddon; Karen Ball; Rob Fredericks; Eric Stuckey