Ohio Education Budget Shortfall and the Consequences of Inaction

Ohio GOP Senators Claim They Can Delay Resolving Education Funding Shortfall until Next Year

If the Ohio Senate fails to act on House Bill 318 by December 31, state aid to local school districts will be cut by $50 million per month, approximately 10% cuts for every district, the largest education cutback in state history.

Click here to see the impact on your local school district.

But the Legislative Ability to Freeze Income Tax Rates at 2008 Level is No Longer an Option After December 31

In early October, the Governor proposed what we believe is the best solution for closing this budget gap immediately. This proposal, House Bill 318, passed the Ohio House on October 21, 2009. The bill would freeze income tax rates at 2008 levels for tax years 2009 and 2010 in order to restore $851 million in support for public education.

Without Legislative Action, Ohio Schools Will Automatically Lose Budgeted Funding Staring in January

Recently, the Senate canceled several House Bill 318 hearings as a compromise between legislative leaders has yet to be reached.  On December 10, Governor Ted Strickland’s staff informed the statewide education associations that unless House Bill (HB) 318 or its equivalent is passed by December 31, 2009, public education funding in Ohio will be drastically reduced. Because the $851 million budget hole is in the Lottery Profits Education Fund, leaving the shortfall unresolved will result in an automatic funding reduction for Ohio’s K-12 schools.

Ohio Will Fail to Meet Race to the Top Eligibility Requirements If the Shortfall Is Not Resolved

The source of the budget shortfall, combined with the Ohio’s Constitution requirement to balance the state budget, will result in the reduction of approximately $50 million of state foundation aid each month for the next 18 months. That means every school district — and Ohio’s pubic colleges and universities — would lose at least $2.3 billion in funding. According to the Ohio Department of Education, that size of a cut would put at risk the state’s ability to receive federal funds. This reduction in state aid drops Ohio below 2006 school funding levels, which is an eligibility requirement to receive federal stimulus funds. Ohio would need to receive a federal waiver in order to still qualify for federal funds, which is highly unlikely. Iowa’s request for such a waiver was just refused.

Taken together, the reduction in state and federal aid to Ohio schools  will exceed a$5 billion. This would amount to the largest reduction in aid to public education in Ohio’s history.

The OEA implores members and friends to call, write and meet with your state senator immediately.  We must stop Ohio lawmakers from making the single largest cut to school funding in the history of the state.

Click here for more information on HB 318 and how to contact your state senator.


Budget General

Leave a Reply