· June 7, 2011

Innovation Ohio Says Budget Shortfall is $5 billion, not $8 billion

Research Overview

In April 2009, then-Auditor of State (now Lt. Governor) Mary Taylor and her Senior Policy Advisor (now OBM Director) Tim Keen called a news conference to grimly warn Ohioans that an historic $8 billion dollar deficit loomed in the FY2012-13 budget. Thanks to constant repetition in the Capitol Square echo chamber, the $8 billion deficit figure has now, two years later, become conventional wisdom throughout the state. The need to close this alleged $8 billion deficit was used by newly-inaugurated Governor John Kasich to justify his proposed two-year budget (HB 153) containing unprecedented and draconian cuts to Ohio’s schools and local governments. Likewise, the “$8 billion deficit” has been repeatedly cited by Gov. Kasich and his legislative allies as a primary rationale behind their all-out assault on the collective bargaining rights of public workers (Senate Bill 5). Recently, however, grave doubts have begun to crop up over the validity of the $8 billion figure. Innovation Ohio looked at three key assumptions in Taylor’s and Keen’s analysis and found that they no longer hold up. As a result, the shortfall the state faces is roughly $5.1 billion, not the $8 billion that is claimed. Read the analysis. Read the press release.