The State of Ohio Budget Woes

The budget office has anounced a $912 million gap in the OH budget between now and June 3oth. For those that don't know - that is just what we are short this year. The budget proposals being worked out in the Ohio Senate are for the upcoming budget - and Gov. Strickland, the House and Senate are all using cherry-picked numbers in crafting that one.

Unemployment in OH has just hit 10.2% - an almost unheard of number in our states history. This will have a direct effect on predicted revenues coming in.... in other words - the estimated revenue numbers being used to craft the budget - will in no way be close to the actual revenues.

Fellow Ohio blogger Kyle Sisk took the time to scribble down some of his thoughts that will hopefully help awaken some of the brain dead Ohioans. Why? Because we will soon be seeing a huge tax increase to pay for the current shortfalls and to cover the stimulus funds once they run out, backward school funding fix, etc...

From Kyle Sisk Blog --

Hopefully this will at least get people thinking a little bit...

The "hole" for this budget is BIGGER than anyone has reported thus far.

No, I don't have access to Pari's numbers (in the spirit of full disclosure, I don't think she has access to real numbers either...I envision some geeky guy in a room with no windows throwing darts at a dart board with budget figures on it...but I digress), but I do have an inkling as to some of the things the Senate GOP caucus will and will not do.

1. The Senate will not be the first to utter the words "tax increase" and because of the shenanigans that both Strickland and the House dems have pulled they have the "high ground" to not have to be the ones who call for a tax increase.

2. The Senate will not take a shot at the Nursing Home Industry (sorry Ohio Business Roundtable...just not going to happen) because the Industry provides way too many much needed campaign funds to hit them...especially since Budish will just take care of them on the back end in Conference. That would give the Senate GOP and Batch and the House GOP Minority (SIDE NOTE: From hereon "Batch and the House GOP Minority" will be referred to on this blog as "The Land of Misfit Toys" until they can show they deserve a different title) the worst of both worlds (i.e. Harris and the Senate GOP make cuts to the Nursing Homes and then Budish saves them in Conference). I hope/believe the Senate GOP caucus is smarter than
that.

3. I am going to do a completely separate blog post on this group of people because I believe it is a core group for the GOP (Kasich especially) in the 2010 elections: 80,000 students in charter schools and the 14,000 students getting vouchers. The Senate MUST MUST MUST restore the full funding to these 94,000 students. This point needs to be a "line in the sand" kind of thing.

4. With much of the backbone of the GOP's voter support coming from school districts that are not treated all that kindly in the Ted version or House version of the school funding proposals be looking for some dramatic shifts from the Senate on who will get funded, major changes in Ted's "not even remotely based in reality plan for today to 2017"

5. Don't look for many changes to the higher education budget. Look for some rearranging with proprietaries and privates, but the overall number will be about the same.

6. No one has been talking about prisons, but I just wanted to put my two cents in on the issue. For some background, I'm a card carrying GOPer who is pro-death penalty and I'd even be for firing squads for rapists (DNA proof) and pedophiles (I know...I'm a bit extreme on punishment of certain offenses, but I only throw this info out at you for what I'm about to say). That said, it is uber expensive to house non-violent drug offenders in our prisons. If this trend continues then our prison (already at or past critical mass with current prison populations) system will not be able to handle the number of prisoners. We will either have situations way worse than Lucasville or in this time where our leaders are trying to find places to make cuts we will be in a position where we will ... gasp ... have to build more, new prisons (how politically popular do you think that is going to be???).

Something has to be done differently with non-violent drug offenders and I can't think of any better time to address this issue than at a time like now when budgets are being scrutinized. That said, I don't think anything will happen on this issue in time for this budget so for the sake of this blog post we will say that no one will cut the prison budget.

7. The Senate won't touch this "slots at the tracks" stuff. It doesn't make sense politically for anyone to do this. Follow my line of thinking here: If the amount created by doing the slots at the tracks actually filled the hole entirely then it would be a no-brainer move. They do it and take shit for doing it, but it solves the budget hole. Done and done. That is not the reality of the situation though. Slots at tracks will not even come close to filling the hole so if the Senate went ahead with it they would get whacked for doing it AND still have the problem/issue of having to still come up with a huge chunk of funds to fill the rest of the hole (i.e. they would be proactively creating two headaches instead of creating just one headache).

Here is what I think will happen with the Senate. They will look at their situation and say,

"Ted & Pari played reindeer games and gave the House a budget not based in reality. Budish then played even more reindeer games and handed the Senate a budget based even less in reality than Ted's budget. Why should we be the adults in this situation? What is the political advantage to doing anything other than operating the same way Ted & the dems have acted? There isn't any....so...we'll continue this game of Fantasyland and take the budget back to Ted's numbers (or maybe a little bit better than that) and we'll essentially start over (sorry lobbying community) in Conference Committee."

If the Senate does that then basically they'll knock off the House dem $91 million, probably do something with Aging &/or the Regents, get rid of some of Ted's onerous fee increases, maybe even do an across the board minimal "window dressing" type cut across state gov't (probably will not do this) and really play with the numbers by adjusting the Medicaid caseload (they will do this because it is an easy way to play with the numbers in the short run).

Doing those types of things will make the Senate look at least quasi-responsible and will get this budget to Conference Committee where the real dirty work will occur.

The thing that will be funny about Conference Committe this budget cycle is that anyone with a brain in their head will be doing everything within their power to make sure they are NOT on the Conference Committee.

Cuts alone will not balance this budget in 38 days. Cuts combined with slots at tracks and all the messing around with figures everyone wants to do will not get us there this time.

The ONLY way to get there is with additional revenue (aka tax increase for those of you on the short bus who do not know what "additional revenue" means).

They will either do a tax increase in Conference Committee OR everyone will be back in Columbus addressing the budget again by say...hmm...no later than October...and then it will probably be even uglier than it is today.

Taxes WILL be increased. It is not a question of IF. It is a question of WHEN and HOW MUCH.