Stick to Prudent Budget in Ohio
Conservative budgeting appears to be paying off for Ohioans. Yet given uncertainty about the economy and federal mandates, now is not the time to loosen the state’s purse strings.
Gov. John Kasich’s administration is projecting state government will end the current fiscal year with $408 million in the bank. And that does not count a $500 million payment from the new JobsOhio program in exchange for use of state liquor program profits in the future.
In other words, the Statehouse may be sitting on nearly $1 billion in cash by this time next year.
But the vast majority of the fiscal year remains to go on the books. A double-dip recession remains possible. And federal mandates, including those involved with the new national health care law, could suck some of that money out of state coffers.
Still, a remarkable turnaround has occurred in state finances. It did not happen by accident – and it most certainly was not inevitable.
Just two years ago, state officials were sweating over the prospect of an $8 billion gap in the budget.
Then Kasich and a new General Assembly committed to realistic solutions took over and enacted a sustainable budget. It required painful spending cuts, to be sure.
Now, however, Ohio’s economy is recovering and the future looks brighter.
No doubt the new budget projections will result in calls for more spending at the state level. Nearly all of them should be rejected, again, because of uncertainty about what may happen during the next 10 months. But another reason to avoid spending initiatives is that Buckeye State residents need tax relief of the type being proposed by Kasich.
If there is discretionary money available in Columbus, the first priority should be income tax cuts of the type proposed by the governor. That should spur the economy to even more growth, bringing with it an increase in state revenue that can be put toward necessary spending in areas such as education.