March 28, 2013
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According to the Ohio Legislative Service Commission, appropriations within the all-funds budget proposed by the governor total $59.6 billion in fiscal year 2014 and $62.6 billion in fiscal year 2015.  This would be an increase over the two-year budget period of $13 billion or 12.1 percent compared the current budget. The all-funds budget is not an accurate reflection of the use of state taxpayer dollars because it contains federal funds, dedicated fees, trust funds and other allocations. The General Revenue Fund (GRF), supported by state tax dollars, is a better indicator – although in Ohio, the GRF contains some federal dollars. Proposed GRF appropriations of $30.5 billion in FY2014 and $32.6 billion in FY 2015 would lift state spending in the coming biennium $9.2 billion above the current budget; when federal funds are removed, the increase in GRF is $3.7 billion, a 9.4 percent increase over the current budget. If expenditures other than Medicaid are the focus, the increase is even smaller.

The GRF is buoyed by improved economic conditions, but it is also bolstered by tax revenues formerly dedicated to local governments, schools and libraries through the Local Government Fund, the Public Library Fund, and tax reimbursements. These revenues will continue to boost state GRF revenues by more than a billion dollars annually in each of the next two fiscal years under current law, when contrasted with historical revenue sharing. [2]

The executive budget proposal for fiscal years 2014-15 reorders priorities moderately. Health reform drives the largest change with influx of federal dollars. Primary and secondary education will see increased state GRF funding of a billion dollars ($1.2 billion on an all-funds basis, not including property tax relief apportioned to education funding); this does not quite restore cuts in the current two-year budget compared to the prior one and is complicated by increased funding for privatization efforts. Higher education sees some restoration relative to cuts in the current budget.  Programs and agencies in human services other than Medicaid see flat funding, after inflation.  While the numbers are big, the basic trends remain the same.

Figure 1 illustrates how the share of the GRF spent on health services has risen since 1975 while human-services funding has fallen to the point that share of spending on corrections now matches that of human services. Investment in higher education has also fallen. Funding for K-12 education dropped initially, but rose for a time as legal action over inequity in funding drove renewed state support. Local government aid has declined sharply since the middle of the past decade.

Other sections:
Executive summary
Medicaid expansion
Other health and human services
K-12 education
Higher education
Local government
Tax policy

[2] The tax reimbursements were for the loss of local tangible personal property tax and utility taxes, eliminated by the state in tax overhauls since 2000.




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