The village of Johnstown learned last week it would lose up to $20,500 in 2011 in state funds under the provisions of Gov. John Kasich's state budget, which could mean an increase in taxes for Johnstown residents.

The village of Johnstown learned last week it would lose up to $20,500 in 2011 in state funds under the provisions of Gov. John Kasich's state budget, which could mean an increase in taxes for Johnstown residents.

Finance director Larry Heiser said the village received $68,000 from the state's local government fund in 2011. Under Kasich's budget, Johnstown will lose nearly 25 percent of those funds over each of the next two years.

The village would receive $51,000 in 2012 and $38,250 in 2013.

The state also gave Johnstown another $14,000 in 2011 from the state's revenue assistance fund.

Heiser said he believes 25 percent of the $14,000 would also be cut during the next two years, but said trying to figure everything out is "just kind of frustrating at this point."

Heiser said revenue from both government sources goes into the village's general fund.

"It's obviously not good for local government," Heiser said. "I think the expectations are local governments are going to consolidate services or figure out a way to provide the same services with less money."

Village administrator Jim Lenner said trying to figure out how to make up the $20,500 in lost funds for 2011 will be difficult.

"Any decrease in our budget is going to be a problem," Lenner said, "That's money that's going to be taken away from general everyday function of the village, whether it be services, staffing or both, so it's never a good situation.

"The state budget is trickling down towards the locals and the locals are going to have to make the decisions on how to recoup that funding or not spend that funding," he said.

Heiser said he had budgeted for a 7-percent state cut this year "just in case," but said an income tax raise may be imminent.

There's currently a 1-percent income tax, Heiser said, and he's looking at what an additional quarter- or half-percent increase would bring into the village.

Heiser said the increased tax could go towards the village's recreation department, salary and wages, or improving the town's streets.

"I'm not sure if they (council) are in favor of that (income tax increase) so it may just end up being we figure out more cuts and figure out how to do more with less, which maybe that's what Kasich wants and maybe it can be done," Heiser said.

He said if council doesn't increase the income tax "we just have to figure out what we're going to do without."

The village had been talking about possibly increasing salaries and wages in the police and service departments, but Heiser said that would not happen now unless there's an income tax increase.

"My personal preference has been if we're going to do anything wage-wise, we're going to have to increase our income tax, but maybe we don't. Maybe local governments will change their standards," Heiser said.

He said the village plans to have public forums to see what residents want "if the emphasis needs to be placed in parks or police, streets" and where "we need to be spending our money or not spending our money."

Heiser also said residents would have to vote for the income tax increase if council approves of the plan.

"Obviously, we want to do what's in the best interest of the residents," he said.