The Ohio House of Representatives next week is expected to approve the state's biennial budget. I have expressed my concerns with the education-funding plan created by Gov. Strickland and House Democrats.
The Ohio House of Representatives next week is expected to approve the state's biennial budget. I have expressed my concerns with the education-funding plan created by Gov. Strickland and House Democrats. In addition to including the first cut in school funding since 1992, it also includes an array of expensive mandates and phases in a flawed funding plan over 10 years.
Today's second-grader would be graduated before the plan is funded fully, assuming the plan is not changed in the meantime.
School funding is far from the only problem with this state budget, though. One might expect that in this difficult economic time, when state revenues continue to drop below revised estimates, that the state budget also would shrink or at least continue at its present levels.
The current budget plan actually includes general-revenue fund growth of 2.4 percent, or $1.29-billion, over the next two years. In order to achieve that growth, more than $5-billion in one-time resources is allocated for use, including $3.1-billion in so-called federal stimulus money. Overall growth in this state budget is actually 16.4 percent when you look at all funds. This is accomplished by increasing a host of fees and moving some Medicaid funding out of the GRF. Even a casual observer could see that overspending Ohio's current tax revenue so drastically likely would lead to a large deficit in our next budget. Even if tax revenue were to grow by $974-million over the next two years, as estimated by the Ohio Office of Budget and Management, this still leaves the state facing drastic budget cuts or requiring a large tax increase.
While some have praised the budget for not including any new taxes, in authorizing more than 150 new or additional fees, it will raise over $1-billion by increasing expenses for everyday Ohioans and Ohio businesses. This is not a smart policy at a time our state is hurting and we are losing jobs on a daily basis. The governor has applauded his success in containing costs, resulting in a savings of $2.7-billion. What is not mentioned is that $2.5-billion in cost containment is achieved through instituting new fees and shifting expenses previously funded by the GRF to these new fees.
It is not fair to criticize only the governor's plan without suggesting any better options. One bill pending in the Ohio General Assembly is House Bill 25. This legislation significantly would change the structure of Ohio government and could result in a cost savings of more than $1-billion per year. Although I am not yet sure of my position on this legislation, the structure of Ohio government has not changed in more than 50 years, and it is time to have the debate over whether there is a more efficient structure of government that also could save Ohioans more of their hard-earned tax dollars.
After education, Medicaid consumes the largest portion of the state budget. Unfortunately, the cost savings in Medicaid in the current budget proposal come more through increasing fees and moving current expenses to that fee revenue than actually finding and eliminating waste or creating a better, more efficient system of providing health care.
If you take all of the one-time money in the state budget and subtract the amount of tax growth Ohio expects to see over the next two years, we will face a budget deficit of $4.29-billion. To raise this money and flat-fund the state government for the next budget cycle would require a 31-percent increase in the sales tax or a 24-percent increase in the Ohio income tax. Neither of these is an attractive option, and Ohio must take the steps today to fix our budget.
Jay Hottinger represents the 71st district in the Ohio House of Representatives.