Blueprint for cutting the state budget


From the Buckeye Institute



COLUMBUS — As state lawmakers work to cut $800 million from Ohio’s budget, The Buckeye Institute today rolled out a series of recommendations policymakers could look at to save taxpayer dollars and trim the needed money. The recommendations are a part of Buckeye’s 2017 Piglet Book, which was released in March, and if implemented, could save taxpayers more than $1 billion, a more realistic target than $800 million, given recent revenue shortfalls.

“The reality is, Office of Budget and Management revenue estimates have been too optimistic and policymakers need to cut $1 billion from the proposed state budget. Cutting $1 billion will offset additional spending and revenue shortfalls, which we should anticipate,” said Robert Alt, President and Chief Executive Officer at The Buckeye Institute. “The good news is, Buckeye has a blueprint – our Piglet Book – that can guide the legislature as it looks for needed cuts.”

Recommendation #1

Eliminate Funding to the Ohio Arts Council: Savings to Taxpayers: $25.9 Million

The Ohio Arts Council receives taxpayer monies through income and sales tax revenue, which is then distributed to specifically-selected artists and galleries. While the work on the Arts Council has value, the government should not be an arbiter of culture. Artistic and cultural endeavors can and should be underwritten by donors giving voluntarily rather than by government fiat.

Recommendation #2

Slow the Rate of Growth in Education Funding: Savings to Taxpayers: $208.7 Million

In FY16, Ohio spent $10.5 billion funding the Department of Education. In the FY18-19 budget, Governor John Kasich asked for $11.2 billion in FY18 and $11.4 billion in FY19 for a total of $22.6 billion. By slowing the rate of growth in education funding, Ohioans could save $208.7 million.

The Buckeye Institute recommends $11.1 billion in funding in FY18 (an increase of $527.4 million over FY16) and $11.3 billion in FY19 (an increase of $748.9 million).

“A quality education is about far more than simply throwing more money at the education bureaucracy,” said Greg R. Lawson, Senior Policy Analyst at The Buckeye Institute. Simply slowing spending growth and shifting funding towards students rather than the ‘system’ can yield not only taxpayer savings, but—more importantly—better educational outcomes for our students. It is time to start moving in this direction.”

Recommendation #3

Eliminate Funding to the Ohioana Library Association: Savings to Taxpayers: $595,228

While not a huge cost savings when compared to the budget killers of Medicaid and education funding, eliminating funding to private organizations, such as Ohioana Library adds up to real cost savings.

The Ohioana Library Association’s work, while laudable, is not a core government service that requires taxpayer subsidies. As with the Ohio Arts Council, private individuals and the private sector should guide investment for this work.

Recommendation #4

Slow the Rate of Growth in Medicaid Funding: Savings to Taxpayers: $1.6 Billion

More than two decades ago then-Governor George Voinovich called Medicaid the Pac-Man of Ohio’s budget. It remains so today, eating up more than 47 percent of Ohio tax dollars.

In FY16, Ohio spent $22.8 billion funding the Department of Medicaid. In the FY18-19 budget, Governor John Kasich asked for $25 billion in FY18 and $25.7 billion in FY19 for a total of $50.7 billion. By slowing the rate of growth, Ohioans could save $1.6 billion.

The Buckeye Institute recommends $24.1 billion in funding in FY18 (an increase of $1.4 billion over FY16) and $24.9 billion in FY19 (an increase of $2.1 billion).

“When Governor Kasich released his proposed budget, I previously said of Medicaid funding, ‘Ohio continues to pick up additional financial burdens that will gobble up an increasing amount of state resources and crowd out other essential investments and priorities,’” said Rea S. Hederman Jr., Executive Vice President and Chief Operating Officer at The Buckeye Institute. “Revenue shortfalls have exacerbated that situation. It is time for Ohio to get serious about controlling Medicaid spending and implementing innovative proposals, such as using 1332 waivers to gain greater flexibility under Obamacare.”

Recommendation #5

Eliminate Funding to the Ohio Grape Industries: Savings to Taxpayers: $2.4 Million

Ohioans pay to market Ohio wines through a five-cent tax on each bottle of wine, something wine producers should pay for themselves.

Taxpayers should not be expected to pay for corporate welfare of any kind, and the government should not favor one business or industry over another. If a company or industry makes a good product, people will buy it. The use of taxpayer money to support favored businesses is both ethically inappropriate and economically harmful.

These recommendations, along with others found in the 2017 Piglet Book, would save Ohio taxpayers $3.8 billion, more than quadruple the needed $800 million for which Governor Kasich and leaders in the Ohio House and Senate have called.

From the Buckeye Institute