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Published: Tuesday, 2/10/2009

Governor Ted Strickland sees devastation if aid evaporates

BY JIM PROVANCE
BLADE COLUMBUS BUREAU CHIEF

COLUMBUS - With a revised federal economic stimulus package threatening to create a nearly $1 billion hole in his proposed budget, Gov. Ted Strickland warned Monday that he could be forced to close two adult prisons and juvenile facilities and cut off mental health treatment and other services to tens of thousands of Ohioans.

The Democratic governor said a proposed $25 billion reduction in general aid targeted to cash-strapped states to shore up their budgets and preserve essential social services would have a "devastating impact" on Ohio.

Among other things, it would undercut his plan for at least a one-year freeze on tuition at state universities and colleges, requiring 40 percent of students to pay more.

Mr. Strickland's two-year $54.7 billion budget proposal is barely a week old.

The plan is dependent on about $5 billion in one-time funding, including $3.4 billion in general and targeted emergency federal aid that has yet to be delivered.

Spokesman Amanda Wurst said the $25 billion reduction in direct proposed state aid nationally could translate into a $930 million reduction in general aid for Ohio.

"Put simply, without substantial fiscal relief for states, more Ohioans will lose jobs and fewer Ohioans will have access to the critical services that our state and local communities provide," Mr. Strickland said in a letter sent yesterday to members of Ohio's congressional delegation.

The U.S. House passed an $819 billion economic stimulus package sought by President Obama solely with Democratic votes. But despite a Democratic majority in the Senate, Republicans succeeded in forcing a compromise with the White House after arguing that the plan was too heavy on government spending and too light on tax relief.

A compromise $827 billion plan that could come to a vote today is expected to draw support from a handful of moderate Senate Republicans. The compromise would slash proposed one-time aid for states for such things as education, social services, and highway and bridge construction in favor of more general tax cuts and tax credits designed to boost car and home sales.

Whatever the final vote, the package is destined for a Senate-House conference committee to hammer out a final bill.

"As an elected official, I believe that fiscal restraint and taxpayer accountability are fundamental responsibilities rightly demanded by the people we serve," Mr. Strickland wrote.

"They deserve nothing less. Yet nearly all economists agree that substantial federal spending is necessary today to avoid the dangers of deflation and to stimulate a stagnant national economy."

Ohio House Republican leader Bill Batchelder (R., Medina) said the state is playing a "dangerous game" by proposing to balance its budget on federal support that doesn't yet exist.

He and other Republicans have also argued that the Strickland budget, which increases spending 4.4 percent over two years despite declining tax revenues, will simply delay the day of reckoning for the budget another two years.

"In my opinion, there is an incredible amount of wasteful spending within this federally funded stimulus plan," said Mr. Batchelder.

"The people of Ohio are looking for fiscal responsibility. If the federal government passes on funding to the people by care of the state, as state leaders we are then charged with the responsibility to ensure that the funds are used in such a way that we do not push the state's problems into tomorrow."

The $930 million proposed reduction in direct general state aid is almost exactly the amount by which Mr. Strickland has proposed increasing state aid to K-12 schools over the next two years. But Ms. Wurst said the governor remains committed to his proposed education reforms.

"The governor believes this investment in education is critical for Ohio to emerge from this recession, so he will make the necessary tough decisions to continue the investment in education," she said.

The compromise package expected to come to a vote in the U.S. Senate also holds less in education aid for schools, but the Strickland administration is still studying how that would affect Ohio.

The letter Mr. Strickland sent yesterday mentions no specific cuts for K-12 education.

Between the general aid and other cuts in specific targeted aid, social service advocates argue the Senate plan could hold $40 billion less for all states.

"Of all the talk of economic recovery, this stimulus money will help retain jobs - 8,000 or 9,000 jobs based on conversations with those out there providing these services," said Gayle Channing Tenenbaum, a child and family services advocate.

"These people would lose their jobs, join those in the unemployment ranks, and would need food stamps and health care," she said.

"This makes no sense for the economy of Ohio. Our concerns are grave."

Contact Jim Provance at:

jprovance@theblade.com

or 614-221-0496.



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