Tuesday, January 28, 2003

Schools will lose if taxes don't rise

Governor wants action by end of February

By Spencer Hunt
Enquirer Columbus Bureau

COLUMBUS - Greater Cincinnati schools and universities will lose $20.8 million in state funds over the next five months if lawmakers don't quickly raise cigarette and alcohol taxes, Gov. Bob Taft warned Monday.

If the General Assembly does not comply by the end of February, "I will be forced to act," Mr. Taft told reporters. "I sincerely hope such reductions will not be necessary."

See how much area schools would lose in Taft's budget cuts
In his third major announcement since Wednesday's State of the State address, Mr. Taft also proposed a 6 percent cap on tuition increases at most state colleges and universities. Despite threatening short-term cuts, he promised slight funding increases for public schools and higher education in his upcoming two-year budget proposal.

Faced with an immediate $720 million deficit in the current budget, Mr. Taft said he'd have to cut $175 million from public schools, colleges and universities. That's unless lawmakers double state alcohol taxes and raise cigarette taxes to $1 a pack.

The ultimatum is intended to turn up political pressure on legislative leaders who've said little so far about the governor's tax hike proposals. If approved, the state tax on a pack of cigarettes would jump 45 cents and the tax on a six-pack of beer would increase from 10 cents to 20 cents.

Without the tax increases, Cincinnati Public Schools would lose $2.9 million by June 30, according to statistics released from the governor's office. The University of Cincinnati would lose $3.7 million.

Mike Geoghegan, CPS treasurer, said any cuts the governor makes would be unacceptable in a school budget expected to grow only 1 percent over the next five school years.

"Any little reduction in state aid really hurts us," Mr. Geoghegan said.

Elsewhere in the region, Lakota Schools in Butler County would lose more than $1 million, and Mason Schools in Warren County would lose nearly $500,000.

"These dollars are critical for us, especially for next year," said Alan Hutchinson, the Lakota Schools treasurer. "We've got negotiations with all three of our unions starting in the fall."

The question now is how lawmakers will respond. House Speaker Larry Householder, R-Glenford, and Senate President Doug White, R-Manchester, said they will look for other items to cut in the budget before they agree to any new tax hikes.

"We'd at least like the opportunity to look for alternatives," Mr. Householder said. "I'm a little bit surprised that (Mr. Taft) didn't leave himself open to that."

Mr. White agreed, saying: "I don't think the legislature has ever been, or shall ever be, totally tied to the governor's proposals. Cigarettes, beer and wine aren't the only revenue streams out there."

A small group of conservative lawmakers already have vowed to oppose any tax increase. State Rep. Timothy J. Grendell, R-Chesterland, insists millions can be cut from the Department of Education without touching direct aid to schools.

"I'm growing tired of being threatened every day," said Mr. Grendell about Mr. Taft's recent spate of press conferences, in which he outlined deep cuts to the Medicaid program and called for a 6-cent hike in the gasoline tax to build and repair state highways.

Mr. White also said he thinks the Department of Education could be cut without cutting state aid to schools. He wouldn't provide any details.

"I'm sure there are other areas of education that can be pared," Mr. White said.

Budget cuts aside, Mr. Taft said he would ask lawmakers to cap universities' annual tuition increases at 6 percent, except for the Ohio State University. He said OSU deserves a higher 9 percent cap because school leaders agreed to forgo a year-end tuition hike.

Colleges and universities that charge below-average tuition in Ohio would also be able to impose a $300 surcharge on all new students.

The governor said he'd propose a 3 percent increase in funding for universities and colleges in the next fiscal year, which begins July 1, and another 4 percent increase in 2005.

Even with those increases, Board of Regents Chancellor Roderick Chu said some universities may have to cut programs and costs if tuition caps are approved.

"I think its understandable that the governor is trying to keep colleges as financially accessible as possible," Mr. Chu said. "I think it will behoove the trustees at each of the colleges and universities to look closely at what they can do."

Greg Hand, a UC spokesman, said officials may have to cut back on student counseling services. "We are at the point where those essential services are sitting on the bubble," Mr. Hand said.

During his re-election campaign, Mr. Taft promised to reinstate tuition caps after several universities imposed double-digit increases on their students during the last school year.

The governor also promised a 2 percent funding increase for public schools next fiscal year and another 5 percent the year after that. The governor plans to appoint a blue-ribbon panel of education experts to study ways to change the existing school funding formula before the 5 percent increase takes effect.

Mr. Taft said he was not looking for ways to dismantle the current school funding formula, created by lawmakers in response to an Ohio Supreme Court order.

"We think it will be improved," Mr. Taft said.

E-mail shunt@enquirer.com

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