State Looks to make $400m budget cut
Governor ‘sensitive’ to certain areas; critic cites ‘failed’ policies.
Ohio Gov. John Kasich and Republican legislative leaders plan to identify $400 million in annual cuts to the proposed two-year state budget amid still-sluggish economic growth. “We’re going to look at all the
options,” the governor said today. “Everything has to be under the microscope.”
Asked if any areas, such as schools, were immune from reductions in proposed funding in the $71 billion-a-year state budget, Kasich said: “The message is we’re not going to take anything off the table.”
Speaker Cliff Rosenberger, R-Clarksville, Senate President Larry Obhof, R-Medina, and Kasich said, however, that funding to battle Ohio’s opioid-addiction and overdose death crisis
likely will not be impacted. How much is $400 million, in terms of state spending? The budget submitted by Kasich recommended a $290 million increase (2.6 percent) in school funding over two years. About $400 million a year also would operate the Department of Natural Resources and its state parks with some to spare.
The pending cuts in spending levels proposed by Kasich are a result of the record economic expansion sputtering to crawling growth both nationally and in Ohio.
Times may be tight, but Ohio has fared better than many, the governor said, pointing to mid-course bud- get cuts in 19 other states last year.
State tax co l lections through March were $615 million or 3.7 percent below projections for the fiscal year,
undermining the assump- tions of the money available for spending in the next budget, said Tim Keen, director of the Office of Budget and Management.
Kasich already had submitted what he has called
a “lean” budget based on slowing tax receipts, but
more spending reductions are needed, he said, to pro
duce a stable budget. He said he would be “sensitive” to
certain budget areas, without specifying them, in making cuts. Kasich and the GOP legis
lative leaders also said they are not looking to tap the state’s $2 billion rainy-day
fund to fill the holes in the budget for the two years ending June 30, 2019.
State Rep. Jack Cera of Bellaire, the leading Democrat
on the House Finance Committee, said in a statement that the coming cuts “will
force us all to pay the price for the failed economic policies of the past” produced by Kasich and Republican lawmakers.
“We were promised that deep cuts to communities, deep cuts to schools, privatizing job creation and shifting taxes to give millionaires breaks would grow our economy and create jobs, but today’s announcement is proof Gov. Kasich and other leaders have broken that promise,” Cera said. Kasich
contends $5 billion in tax cuts on his watch have fueled
the creation of 460,000 private-sector jobs.
Keen said the planned reductions would leave the state budget essentially “flatfunded” over the next biennium. Obhof said the budget reductions can be managed “while making key targeted investments.” None indicated areas that could be spared beyond the mentions of the fight on opiods. “It’s important for us to get ahead of this,” Kasich said at a late-morning press conference at the Statehouse. Rosenberger said the governor and the leaders will work as a team to trim projected spending. “We’re not going to drop the ball,” he said. The governor had proposed increasing the state sales tax by one-half cent and other tax incre ases to finance a further cut in income taxes. Kasich said he would still like to see income taxes cut to aid business and job growth, but conceded it may not happen.