The Governor's budget...who are the losers and who are the winners?
hwilkinson@enquirer.com
• Contact your House member at www.house.state.oh.us
• Contact your Senate member at www.ohiosenate.gov/
Ohio's Republican-controlled government isn't just writing a budget, it's creating a document that represents the biggest shift in priorities in state spending in many decades.
On Thursday the House passed a $55.6 billion general fund budget, largely keeping new Gov. John Kasich's proposed budget intact. After a blizzard of amendments, speeches and committee meetings, the state's new direction is becoming clear.
Among the losers:
• Local governments, who will see a cut of about $640 million in direct funding from the state and have to find some way to plug the hole or raise their own local taxes.
• Public schools, which took an $800 million hit.
• Higher education, which loses about $260 million.
• And nursing home operators, who will lose about $470 million in Medicaid spending.
Among the winners:
• The owners and operators of charter schools, who will find it easier to start new schools and attract students with an increased voucher program.
• And those in the private sector who might be interested in coming into Ohio and running the six prisons Ohio will sell and, possibly, buy or lease other state assets, such as the Ohio Turnpike.
The $55.6 billion two-year general fund budget passed by the Ohio House late Thursday night is about $5 billion bigger than the one passed two years ago when there was a Democrat, Ted Strickland, in the governor's office and Democrats held control of the House.
The budget bill now goes to the GOP-controlled Senate, and the senators could have more money to work with - nearly $1 billion more, because of rosier-than-expected state revenue receipts so far this year. That could mean some cuts in the House budget could end up being restored.
Kasich and the Republicans in the legislature were in a good mood Thursday night after passing the budget on a party-line vote. Many wore buttons provided by the governor trumpeting the fact that they had balanced the budget without raising taxes - buttons that had the number $8 billion with a line drawn through it.
"This is reality-based budgeting," said state Rep. Ron Amstutz, R-Wooster, chairman of the House Finance Committee.
Others were not so pleased.
For hard-core fiscal conservatives, it is a budget of same-old, same-old - the government finding a way to spend every dime it takes in, instead of giving some of it back to the weary taxpayer.
"When do Ohioans get to see a noticeable reduction in the spending curve?" asked Matt Mayer, director of the Buckeye Institute, a conservative think tank which has advocated deep cuts in state spending. "It looks like a budget based on revenue, not true government need."
To Democrats and their allies, it is a budget that, as the House Democratic Caucus' talking point puts it, "balances the budget on the backs of the middle class."
"This budget goes straight after the weakest people in our state, the people who can't fight back," said Ohio Democratic Party chairman Chris Redfern, a former state legislator. "Cuts to nursing home care, cuts to children's hospitals, cuts in funding for local government services people depend on, cuts to schools."
Kasich and the GOP legislature, Redfern said, "are robbing Peter to pay Paul, and putting off the difficult decisions that need to be made. It's unconscionable."
'It's happening everywhere'
Whether unconscionable or inadequate, the Ohio budget racing its way through the legislature is typical of what is happening in state legislatures all over the country. Many states went into 2011 facing large deficits; and many states, Ohio included, are required by state constitutions to find a way to balance their budgets.
"It makes for some tough choices," said Donald E. Boyd, senior fellow at the Nelson A. Rockefeller Institute of Government in Albany, N.Y., and an expert on state and local government revenues. "With states facing the kind of deficits they are - and there are those where the situation is worse than in Ohio - you can't avoid cutting services."
And, in many cases, Boyd said, the cutting includes not only cuts in state services, but substantial cuts in state aid to local governments. The one thing that is making the job of balancing state budgets easier, Boyd said, is that most states are seeing their revenues grow
That is certainly true in Ohio.
Personal income tax collections were up 11.9 percent in April over budget projections and sales tax collections were up 6.7 percent. Overall, this year's total revenues are 1.9 percent ahead of projections.
Compared to a year ago, the state is $841 million ahead of its tax revenue - an increase of 6.1 percent, according to state budget figures.
On to the Senate
Kasich is also proud of the fact that he and the GOP-controlled legislature have fulfilled a campaign promise - that the budget would be balanced without raising taxes.
It was done, in part, because the state's revenue picture is brighter now than it was a year ago.
"We're doing what folks didn't think anyone could do - fill a massive $8 billion budget gap without raising taxes and while preserving the $800 million income tax cut," Kasich said Thursday night.
Critics of the budget say the governor's claim of not raising taxes is disingenuous. So do the people who are in the process of trying to build casinos in four Ohio cities - including Cincinnati - through a constitutional amendment approved by Ohio voters in November 2009.
The House left in a provision that would require the casinos to pay the commercial activity tax on all gambling receipts, without a deduction for winning payouts.
"That amounts to about $1 billion those casinos would have to pay the state," Redfern said. "Someone explain to me how that it not a tax increase."
But it was the cuts in school funding, Medicaid for nursing care and local governments that really stuck in the craw of minority Democrats in the legislature.
"This budget is an abomination," said state Rep. Connie Pillich, D-Montgomery. "The budget busts public schools, local governments, and care for the elderly and infirm."
Republicans in the House dismissed the Democratic complaints - something they could easily do, given the fact they have a 59-40 advantage in the House and a 23-10 lead in the Senate, the budget's next stop on its to the governor's desk.
State Rep. Danny Bubp, R-West Union, made fun of the floor speeches he heard from Democrats in Thursday's debate.
"People are going to die; the state is going to end tomorrow," Bubp paraphrased sarcastically.
"This budget is difficult," Bubp said. "I don't ever recall the rhetoric we heard today."
Redfern, though, said he is certain the GOP legislature will suffer for what it has done in the next election.
"They can do what they want; they've got the numbers," Redfern said. "For now."
Staff writer Jon Craig contributed.
posted by Kathie Bracy at 5:55 PM
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