|
Kasich
Communications Department...
Columbus
Dispatch
Savings
account... Restoring Ohio’s fiscal foundation is the proper goal
Monday July
9, 2012
Rebuilding
Ohio’s fiscal integrity after years of ruinous overspending is
difficult and
will take time. Gov. John Kasich is working on that by putting all
surplus cash
from the recent end of the fiscal year in the state’s rainy-day fund.
What’s
easy, on the other hand, is for state Rep. Vernon Sykes to accuse
Kasich of
“callous disregard,” for not spreading that money around to school
districts
and local governments whose budgets are squeezed because of previous
cuts in
state aid. The Akron Democrat said, “To simply continue to put money
into our
rainy-day funds overlooks the need that is out there.”
No. What it
does is establish that Kasich is serious about stewardship of Ohio’s
treasury.
Any public
official, including Sykes, should know the basics of sound public
finance. The
Government Finance Officers Association advises governments to keep a
two-month
reserve in the bank for emergencies. With the addition of the surplus
from the
closing fiscal year, Ohio’s reserve now is at $482 million — less than
a week’s
worth of spending.
Given that
Kasich started his term with 89 cents in the fund, that’s an
accomplishment to
be proud of. But it’s still well short of a healthy savings account, at
1.8
percent of the general revenue fund. Debt-rating agencies require an 8
percent
reserve for their highest rating, and the finance officers’ association
recommends 16 percent.
Insisting
on a prudent fiscal course for the state can’t fairly be labeled as
“callous
disregard.”
That term
better describes the actions of former Gov. Ted Strickland and the
previous
legislature, who together plunged Ohio’s budget into an $8 billion hole
by
draining every source of cash and folding every available federal
stimulus
dollar into the spending plan, heedless of the fact that those revenue
sources
wouldn’t be available for the next budget.
This
shortsightedness created budget time bomb.
No doubt,
school districts and local governments feel the reduction in state
dollars, yet
they hardly are crippled; according to data from the U.S. Department of
Labor’s
Bureau of Labor Statistics, Ohio has gained 5,600 local-government jobs
in the
past year, under Kasich’s budget. Most of those gains have come since
February.
Nevertheless,
local governments, along with families and individuals struggling
through a
sluggish recovery, need long-term solutions to tight budgets. This has
to
include refocusing priorities to keep spending within revenues.
Tossing
them a quick handout, setting them and the state up for another cycle
of
deficits and drastic cuts, wouldn’t help anyone.
Read this
and other articles at the Columbus Dispatch
|
