COLUMBUS, Ohio (AP) — Ohio's budget director delivered roughly $1.5 billion in rosy state revenue projections Wednesday as legislators headed into final negotiations over the state budget.
Tim Keen told a budget compromise committee that tax revenues were up $1 billion over estimates for the fiscal year that ends this month and $421 million for the next two-year budget cycle.
The current-year boost comes from stronger income tax filings, he said, as the state tries to recover from the worst recession since the Great Depression. The anticipated money in the coming years is a result of an increase in certain tax estimates.
However, Keen cautioned state lawmakers that most of the additional bucks had already been accounted for.
For instance, he said, this year's dollars will go toward unpaid bills, Medicaid, property tax relief and payments to universities among other state obligations. State lawmakers had pre-spent in their budget plan any additional money that he saw coming, he said.
Still, the new numbers are likely to set off a debate over whether more money should be stashed away or shifted to other priorities.
"There's going to be a lot of jockeying," House Finance Chairman Ron Amstutz told reporters.
Amstutz is part of a group of six lawmakers — three from the House and three from the Senate — who have started to work out the differences between their two chambers' spending proposals.
The conference committee heard testimony from Keen and legislative analysts. They briefed legislators on new revenue projections and Medicaid caseload estimates for the state. The figures will help the committee finalize how many dollars should go to health care programs, schools and local governments.
"I believe given some of the uncertainties we face, we ought to be using the most conservative revenue estimates possible," Keen said.
Keen said his calculation would leave a surplus of $187 million this budget year.
Gov. John Kasich, a first-term Republican, wants to put the extra money in the state's rainy day fund. The reserve fund has just shy of $2 in it now, Keen said.
State Sen. Michael Skindell said the surplus should go to early childhood and mental health programs, or to meet the needs of the poor and disabled.
"They're tucking it away into little corners without putting it into programs that are essential to take care of the most vulnerable in the state of Ohio," Skindell, a Lakewood Democrat, said of the administration's plan.
While the new estimates may spare state legislators from having to make deeper cuts, there were still sticking points ahead for the budget compromise committee.
The House and Senate, both led by Republicans, have each passed different versions of the state budget on party-line votes.
The $55.7 billion spending blueprint largely retain policy initiatives Kasich proposed, including an overhaul of Medicaid programs, privatizing several state prisons and transferring the state's liquor profits to a new semi-private economic development entity called JobsOhio.
Budget negotiators will grapple with legislators' salaries and whether they should be cut by 5 percent, what the threshold should be for paying a union-scale wage at certain construction sites, and whether a merit-based pay system for teachers should be included in the budget.
The deadline for lawmakers to pass the budget bill is June 30. A new fiscal year begins July 1. Amstutz said negotiators will have until the end of next week to hash out an agreement.
The committee is working off the Senate plan. The proposal would spend more money on high-performing schools and in-home care for the elderly than the House version. It also adds a plan to privatize the day-to-day operations of the Ohio Lottery and proposes such sweeping policy changes such as banning abortions in publicly funded hospitals.
Senators set aside $115 million more for schools, $100 million more for local governments, and $15 million more for home-based nursing care than their House counterparts. That was the result of more optimistic state revenue estimates when they put their spending plan together. Senators also stripped out House-added language tying teacher pay more closely to performance than seniority and training.
Lawmakers have said the state faces an estimated $8 billion budget shortfall, which has forced them to make deep spending cuts. The liberal think tank Innovation Ohio has put the deficit at closer to $5 billion.
Outside groups have also weighed in on where any extra cash should go.
Advocates for children, seniors and the poor have called on leaders to spend the money on food assistance, mental health and addiction treatment services, early childhood programs and home-based care for the elderly and disabled.
Members of Ohio's Campaign for Jobs have urged lawmakers to think creatively about what to do with any additional money.
Linda Woggon, executive vice president of the Ohio Chamber of Commerce, has said the coalition of business groups wants the money to be spent in "innovative" ways. One example, she said, might be an incentive program aimed at giving grants to local governments who share services.
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