Township of Andover v. Ashtabula County Budget Commission , 49 Ohio St. 2d 171 ( 1977 )

Per Curiam.

The local government fund is a form of financial state support of the smaller governmental units existing in Ohio. It is composed of a portion of the state sales tax receipts⁴ and the state-collected tax on “capital employed by financial institutions, and * * * by dealers in intangibles.”⁵ These funds are transferred by the state auditor to the several counties for distribution to the local subdivisions. A group of three county officials, designated as the budget commission, then has the responsibility of allocating the local government fund. The budget commission may apportion such funds on a straight formula basis, the “statutory method,” or by the “alternative method,” which latter method allows the budget commission to consider any factor deemed to be “appropriate and reliable,” in its sole discretion. The budget commission meets annually, on the first Monday in August,⁶ at which time it considers the budget submitted by each governmental subdivision.⁷

Appellant presents several arguments to this court which, he urges, warrant a reversal of the Board of Tax Appeals’ decision to reinstate the “alternative method.” We are not persuaded that the adoption of the “alternative method” by the various governmental units constitutes a contract, and hence reject appellant’s attempt to apply principles of contract law. Likewise, we find no merit in appellant’s assertion that the statutory scheme for adoption and repeal of the “alternative method” abrogates a purported power of local self-government. (See Beachwood v. Bd. of Elections [1958], 167 Ohio St. 369.) We do, however, agree with both appellant and appellees that the apparent intent of the General Assembly, in enacting R. C. 5747.53, was to maximize flexibility in the allocation of the local government fund.

The city of Ashtabula has agreed to participate in the more flexible method of allocation of funds, yet has sought to limit its participation by annual resolutions which commit it to the “alternative method” for the next succeeding year only. After having considered, in pari materia, all the Ohio statutes pertaining to the annual distribution of the local government fund, we are unable to agree with the Board of Tax Appeals’ decision requiring that the city be indefinitely locked into the “alternative method,” when it has expressly limited its participation in that method to a definite period' of time and the entire statutory scheme implies an annual determination of the method of distribution.

Accordingly, this court holds that the Board of Tax Appeals’ decision is unreasonable and unlawful, and it is., therefore, reversed.

Decision reversed.

O’Neill, C. J., Herbert, Celebrezze, P. Brown, Sweeney and Looher, JJ., concur.

4 R. C. 5739.21

5 R. C. 5725.24

6 R. C. 5705.27

7 R. C. 5705.30