Sunday, February 2, 2003

Service reductions to go deep

Ohio budgeting effort 'unprecedented'

By Spencer Hunt
Enquirer Columbus Bureau

COLUMBUS - Gov. Bob Taft wants to raise fees on everything from state fishing permits to X-ray inspections to help balance a $49 billion budget he will unveil Monday.

The increased fees at 20 state agencies, boards and commissions will be added on top of a daunting list of higher taxes Taft has already proposed over the past 10 days. That list includes such items and services as cigarettes, beer, wine, cable TV, real estate commissions, dry cleaning and taxis.

Gov. Taft
If you have a comment on Gov. Bob Taft's plan to raise taxes, you can reach him at:
Constituent phone line: 614-644-4357
By letter:
Gov. Bob Taft
77 South High St.
30th Floor
Riffe Center
Columbus, OH 43215
All told, the governor's proposed two-year budget would spend $3 billion in new tax revenues. At the same time, administration sources say, 42 out of 68 general revenue funded programs will spend less in the next fiscal year than they will this year.

Budget documents obtained by The Enquirer show slight funding increases for schools, higher education, and the Third Frontier, the governor's high-tech business development initiative.

The governor will also propose closing a handful of state boards and commissions to save money. Budget documents show more than 120 employees at the departments of Health and Natural Resources will lose their jobs with a promise of more layoffs to come.

"While the budget contains unprecedented reductions in state services, it allows the governor to protect his priorities, which are education, job creation programs and services for children and people with disabilities," Orest Holubec, Taft's spokesman, said Saturday.

State finances have been reeling for more than a year due to the nation's poor economy. Efforts to balance the current budget have forced lawmakers to exhaust $1.5 billion in rainy day and other reserve funds to help make ends meet.

Medicaid, the government's health care program, also continues to cost billions more a year. That's led many government observers to predict a $4 billion deficit over the next two years. The executive budget summary does not include an official deficit estimate.

In the days leading to Monday's budget unveiling, the governor has already announced much of his spending proposal's biggest shockers: namely, the new taxes and $1.1 billion in future Medicaid spending cuts.

Documents show cash-strapped state agencies will also turn to the fees they charge to provide more of their funding.

The Department of Natural Resources would raise 28 different fees. Fishing permits would increase from $15 to $19 for Ohio residents. Out-of-state visitors would see the cost of a three-day permit double from $15 to $30. Deer and turkey hunting permits would increase from $20 each to $25 each.

Elevator inspection fees charged by the Department of Commerce will increase from $105 to $200. The Ohio Barber Board would raise the cost to take its licensing exam from $60 to $90, and then raise the license fee from $20 to $30.

The Department of Aging would raise an extra $825,000 a year by doubling the tax placed on all nursing home beds from $3 to $6.

Other proposals outlined in the budget documents reflect the governor's earlier statements and announcements.

Medicaid spending would be reduced $1.1 billion largely by freezing annual increases in payments to nursing homes, hospitals and homes for the mentally retarded. Dental, vision, psychologist, podiatry and chiropractic services would no longer be covered.

State employees would see no pay raises over the next two years and no funding for increased health care costs. Even with these measures, budget documents warn "layoffs and further reductions in the number of state employees will be necessary."

The question now is how legislative leaders and lawmakers will react to the budget plan in the days and weeks to come.

Lawmakers like Senate President Doug White, R-Manchester, have put off saying whether they'd support a tax increase until they see the budget proposal and the size of the deficit.

The General Assembly must approve the budget before the July 1 start of the next fiscal year.


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