- Finance Department
- Township Finance 101
Township Finance 101
Liberty Township’s main source of revenue is property tax, which includes both inside (non-voted) and outside (voted) millage. The township receives limited funding from the State of Ohio such as: Local Government Funds, Gas Tax, Motor Vehicle Tax, and Permissive Motor Vehicle Tax.
As mentioned above, the township receives outside millage, which are voted levies approved by the residents of the township. A levy is typically for either a 5 year term or a continuous period (ongoing). The biggest misconception with levies is that the more people that move into the township, the more money the township will collect from the voted levy. This is not the case, in fact the township is capped at an amount at the time the levy passes, and will not collect any additional funding above that amount unless it passes a new levy. Therefore, in a growing community like Liberty in order to capture additional property tax values and increase revenue, new levies must be considered to help offset the increased cost to provide services.
To learn more about inside/outside millage and voted levies, reference Understanding Township Funding provided by the Ohio Township Association.
When it comes to township spending, the township each year is required to certify funds to the County Auditor to ensure a balanced budget.This procedure confirms that the township does not allocate or spend more than the revenue received in any given year.The township has several operating, debt and capital funds; however all but one (General Fund) of those funds are restricted. A restricted fund may only be used for the designated purpose, and nothing more. An example of a restricted fund would be the Fire Fund, in which the revenue received for fire services may only be spent on fire and ems related items – it cannot be used for roads, police, etc.This is a common misconception when it comes to township funding.
Liberty Township works diligently by getting multiple quotes for best pricing, collaborating with other entities for bulk purchasing and investigating all options when it comes to spending taxpayer money in an effort to save money to carryover each year. Allowing for some carryover funds is a smart budgeting practice in an effort to ensure that services can continue in case revenues decrease for unforeseen reasons (i.e. state cuts, property value decreases, etc.). This practice was integral when the State of Ohio made cuts to the Local Government Fund as well as when Estate Tax went away. Thanks to the smart planning and conservative spending of our Trustees and Fiscal Officer, Liberty was and continues to be in a great financial position.