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$Oft CITY OF NORTH OLMSTED RESOLUTION NO. 2003 - 35 By: Council Members Dailey and Gareau A RESOLUTION URGING THE GOVERNOR OF THE STATE OF OHIO AND THE OHIO STATE LEGISLATURE TO SEEK DIFFERENT WAYS TO BALANCE THE STATE OF OHl'U'S BUDGET SHORTFALL RATHER T11AN ON THE BACKS OF OHIO CONSUMERS, REALTORS, AND THE OHIO REAL ESTATE INDUSTRY, AND DECLARING AN EMERGENCY. K'HEREAS, Ohio law already requires a tax on the transfer of property (conveyance fee) of One Dollar ($1.00) per thousand datlar of value. Seventy of eighty- eight eounties in Ohio levy a conveyance fee more than the minimum amount prescribed in law. As local government funds a.re reduced by the State, it is likely that more and more counties will raise their conveyance fee to offset the State reductions; and WHEREAS, research by the National Association of Realtors shows that for every One Hundred Dollar ($100.00) increase in the overall price af a home, approximately 1,200 househoids wi11 be priced out-of-the homeownership market. If a service tax is enacted, the cost of buying a home will definitely increase and prevent many C?hio families from realizing the dream of homeawnership; and N'HEREAS, a typical Realtar in Ohio is fifty-three (53) years old, has been involved in real estate for eleven (11) years, works full-time, and earns $27,000.00 in real estate related income per year. Nearly fifty percent (50%) of Realtors in Ohio pay their own medical insurance. In addition, Realtors in Ohio already pay income tax on the commissions they earn. An expansion of the sales taY to include real estate cammissions may pressure Realtors to lower the commissions to a level that offsets the tax liability or pass the tax on to the customer. As a result, the tax will drive up the cost of buying and selling a home; and WHEREAS, sales tax on services used by brokerage businesses woutd significantly add to their operating expenses. This could place some sma11 and emerging businesses at a disadvantage to larger companies that are able to perform many of these functions in-house; and N'HEREAS, the real estate industry has been the one bright spots in Ohio's economy through this current recession. In fact, many econvmists have been watching the housing market closely, because the sector has played a critical role in bolstering the economy while other sectors, like rnanufacturing, have struggled. David Lereah, NAR's chief economist said housing was responsible far sixty-one percent (61%) of all the growth in the U. S. gross domestic product (GDP) in 2041. "Give the record volume of ?,,,...