County governments in Ohio rely on revenues from many sources to support their operating budgets. The three most prevalent sources of revenue for county governments are taxes, charges for services, and intergovernmental transfers. Taxes levied by counties come in different forms with the most common being sales, real property, and lodging taxes. Charges for services are revenues from providing services such as filing in county court or requesting a marriage license. Intergovernmental transfers, often an overlooked revenue source as individuals within a county do not directly pay for this revenue source, are the final prevalent source of funding for counties.
Intergovernmental transfers are when another unit of government, typically the federal or state government, provide funding to a county. Ohio uses the Local Government Fund to provide state funding to counties, and the federal government provides funding directly and indirectly to counties. Indirect funding to counties flows through state agencies to counties instead of directly to counties.
Percent of Federal Funding by County
Federal funding supported 18.7 percent of county spending in 2021
During FY 2021, Ohio’s 88 counties spent $11.5 billion on all expenditures from all sources. Federal funding supported $2.1 billion or 18.7 percent of this spending. This funding comes from many federal agencies that support a wide variety of activities. Federal funding that supports health and human service activities accounts for the largest part of the funding, 58.7 percent, or $1.3 billion, of all federal funds spent by counties support these activities.
This includes funding from the Department of Health and Human Services for Medicaid, the Social Services Block Grant, and Temporary Assistance to Needy Families (TANF), the Department of Agriculture for the Supplemental Nutrition Assistance Program (SNAP), the National School Lunch Program, and the School Breakfast Program, the Social Security Administration, and the Centers for Disease Control and Prevention.
Funds related to ARPA and COVID relief
The next largest bucket of funding, accounting for $548.4 million, or 25.5 percent of all federal funds spent by counties was from the Department of Treasury. This funding supported the COVID-19 Coronavirus State and Local Fiscal Recovery Funds which was authorized by the American Rescue Plan Act (ARPA). This funding was used by counties to respond to and recover from the COVID-19 public health emergency.
Federal funding supporting transportation and public safety
Federal funding that supported transportation and public safety activities accounted for $170.6 million or 7.9 percent of federal funding spent. This includes funding from the Departments of Transportation, Homeland Security, Justice, and Defense, the Federal Highway Administration, the Federal Emergency Management Agency, the Federal Aviation Administration, and the United States Coast Guard. Federal funding that supported economic stability from the Departments of Housing and Urban Development, Labor, and Commerce accounted for 7.1 percent, or $154.1 million, of federal spending.
Federal funding categories amounting to less than 1 percent
All other expenditures that receive federal funding account for 0.7 percent or $15.1 million of federal funding spent by counties. This includes funding from the Departments of Education, Energy, and the Interior, Environmental Protection Agency, Election Assistance Council, and many others. A table illustrating all federal funds received by counties can be found in the appendix.
As previously mentioned, federal funding supported 18.7 percent of all county expenditures in FY 2021. The three counties with the highest share of federal funding are Belmont County at 58.4 percent of all expenditures coming from federal support, Athens County at 43.0 percent, and Cuyahoga County at 32.5 percent. The three counties with the lowest share of expenditures being supported by federal fundings were Delaware County at 6.8 percent, Ross County at 6.0 percent, and Paulding County at 3.8 percent. It is worth noting that Paulding County and Defiance County use a combined Jobs and Family Services department, which influences how federal dollars are reported in Paulding County.
Federal Funding per capita by County
Ohio counties average $182.45 of federal spending per resident
Per capita spending includes federal funding that is reported through counties financial audits. This would include direct awards from the federal government and indirect awards where the funding flows through a state agency. Per capita spending on a county level ranges from $40.75 per person to $762.32 per person. The bottom three counties for per capita spending are Paulding County ($40.75), Ross County ($51.52), and Miami County ($57.96).
These three counties also have a very low percentage of their county budget, being federal dollars. As previously noted, Paulding County and Defiance County use a combined Jobs and Family Services department, which influences how federal dollars are reported in Paulding County.
The top three counties for per capita spending are Morgan County ($486.51), Belmont County ($686.43), and Monroe County ($762.32). Notably, these three counties have over a quarter of their county budget being federal dollars, with Belmont County having over half of their county budget as federal funds. Belmont County had higher than average funding from the Department of Agriculture, around $35 million for water and sewer updates and improvements. The grant-loan was spread across several years and totaled $72 million.
Population does not seem to play much of a role in per capita spending of federal funds. Franklin County, the highest county population, is squarely in the middle with a spending of $136.16 per capita. Monroe and Morgan Counties, two of the highest per capita spending, have very low populations, with around 13,000 people in the county.
Federal dollars in county budgets are imperative
Federal funding accounts for 18.7 percent of all county expenditures statewide with an average of $182.45 being spent per resident.
Without this funding, counties would either need to increase revenues elsewhere, which likely could only be done through tax increases, or cut expenditures. The more likely route would be cutting expenditures as households in Ohio are already feeling the strain from the most recent property tax update.
The Center for Community Solutions has previously reported on the impacts of federal assistance being disrupted and on how health and human services are funded in Ohio. In the coming weeks, Community Solutions will cover federal funding by Congressional Districts too.
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