State budget dips into tobacco fund

4/10/2005

COLUMBUS - The proposed $51.3 billion, two-year budget slated for a House committee vote tonight repeatedly turns to smoking prevention dollars to make the numbers balance.

The House Finance Committee put off adoption of budget amendments last night when the first Republican proposal out of the box would have allowed any government or school district to reopen a union contract for renegotiation for "fiscal reasons." Democrats balked at the surprise.

The budget proposal would divert more than $28 million from the state's tobacco settlement to underwrite auto emissions testing in the Cleveland and Akron areas, finance a program urging Ohioans to adopt healthier lifestyles, and generally fill a hole in the budget.

On top of that, the plan calls for the transfer of an unspecified amount next year to finance conversion to a managed-care system for the aged, blind, and disabled, the most expensive Medicaid population. The Legislative Services Commission puts the transitional costs in the "millions of dollars."

"Tobacco funds are used now for school construction, and that has nothing to do with why we sued the tobacco companies," said state Rep. Jim Trakas (R., Independence).

The budget relies on transferred tobacco dollars, lower per-pupil dollars for schools, and other maneuvers to pay for a greater business tax cut than Gov. Bob Taft proposed and their own funding priorities.

"I don't think this is the beginning of the end," said Robin Hall of the United Way of Ohio and the Ohio Health Care Partnership. "The beginning was when they first dipped into the [tobacco] money."

The partnership has advocated an even larger cigarette tax hike than Mr. Taft proposed to repay the anti-smoking fund and restore endangered health-care programs.

Although the budget provides a minor overall increase in K-12 funding, it lowers the amount the state will pay per pupil 0.8 percent from what Mr. Taft proposed in 2006 to $5,283 and by 1.6 percent to $5,399 in 2007.

This occurs as House Republicans have proposed allowing schools to seek up to 8 mills in local property taxes that could increase in revenue value with property values and restore authority removed from state law several years ago allowing districts and municipalities to ask voters to approve a joint income tax.

While the House version fully or partially restores funding for several social service programs, those left behind continued to implore the committee yesterday to restore their funding.

Rep. Peter Ujvagi (D., Toledo) compared the $185,000-a-year Women in Transition/Displaced Homemakers Program's to the current controversy over the Bureau of Workers Compensation's $50 million investment in a rare coin fund operated by prominent Toledo area Republican and coin dealer Tom Noe.

"Noe said they're getting 20 percent return," said Mr. Ujvagi. "[Women in Transition] more than doubled the investment of the state in terms of the additional dollars that they're able to raise. Plus, all of these folks who are now taxpayers are touting degrees. I think that's a hell of a lot better return on investment than gold bullion."

Contact Jim Provance at: jprovance@theblade.com or 614-221-0496.