Labor, business groups oppose funding ‘raid’
Senate Republicans’ decision to tap funds from the Bureau of Workers’ Compensation and the Ohio Industrial Commission to help balance the new twoyear state budget has drawn united opposition from the state’s major business associations, the Ohio AFL-CIO and trial attorneys.
“This language sets an extremely dangerous precedent of allowing the state to ‘ raid’ the budgets of these exclusively employerfunded agencies,” said a letter addressed to legislative leaders signed by the Ohio Chamber of Commerce, NFIB/Ohio, the Ohio Manufacturers’ Association and the Ohio Council of Retail Merchants.
The Senate-passed budget authorized the state budget director to transfer up to 2 percent from a variety of funds made up of fees and assessments paid by businesses for specific purposes. In addition to those at the Industrial Commission and Workers’ Compensation, they included funds at the Environmental Protection Agency, Department of Insurance, Consumers’ Counsel and State Racing Commission.
John Fortney, spokesman for Senate President Larry Obhof, R-Medina, said the transfers were along the lines of the 3 to 4 percent cuts to most state agencies that majority Republicans determined were necessary to fill a roughly $ 1 billion hole in the budget that Gov. John Kasich introduced in late January.
The agency cuts amounted to about $ 125 million, and another $100 million came from unspent agency fund balances.
“We made it clear during the budget process there would be reductions in agency budgets across the board,” Fortney said.
But unlike most agencies funded with tax dollars, business and labor worry that the fees they pay for workers’ compensation to help cover medical costs and wages when a worker gets hurt should not be used to balance the general budget. The Industrial Commission and Bureau of Workers’ Compensation each has separate budgets approved by the legislature.
“We are very concerned this language gives this and future administrations the go-ahead to siphon funds when budget shortfalls occur. There could also be a legal issue with directing funds to the ( general revenue fund) that are constitutionally set for the treatment of injured workers and promotion of safer workplaces.”
The AFL-CIO and trial attorneys expressed similar concern, adding that the state Insurance Fund is for workers and employers to pay compensation and benefits. “It has no other purpose,” they wrote. “Thus, the Ohio Supreme Court long ago held that it is unlawful to transfer moneys from the fund to unrelated accounts, such as the general revenue fund.”
The issue adds more complications to ongoing discussions between the House and Senate that already will require the chambers to work out hundreds of budget differences over the next few days. Budget Director Tim Keen said the Senate-passed budget was only about $ 20 million short of meeting updated revenue and spending projections, but removing these fund transfers would add to that total.