DeWine announces huge budget cuts after ‘1 billion-dollar swing downward in just two months’

By Tom Barr -

The State of Ohio reports, as of the Tuesday afternoon update, 20,969 total COVID-19 cases (including probable cases). Overall, 56 percent are males and 44 percent females, with 1,123 ICU admissions, 3,956 hospitalizations and 1,135 deaths (including deaths from probable cases).

No new cases have been reported in Clinton County since last week.

At Tuesday’s news conference and via Twitter, Ohio Gov. Mike DeWine said, “As we have all seen, COVID-19 has had a profound impact on the American economy. And Ohio’s economy as well. Prior to the onset of the coronavirus pandemic, Ohio’s economy was strong and our budget was on track.

“For example, by the end of February, state revenues for the fiscal year were ahead of estimates by over $200 million. We now have the figures in through the month of April, and our fiscal year-to-date revenues have taken a dramatic turn.

“In these two months, we are now below the budgeted estimates by $776.9 million. As you can see this is close to a 1 billion-dollar swing downward in just two months.

He announced, “Today, I am announcing a $775 million budget reduction in General Revenue Fund spending for the remainder of Fiscal Year 2020. That means we have to obtain these $775 million in cuts over the next two months.

”I have decided to not draw money from the rainy day fund to cover the next two months’ deficit. We have decided to make cuts to allow us to balance the budget for the next two months. Simply stated, we are going to need the rainy day fund for next year, and possibly the next.”

DeWine said cuts the next two months will be:

• Medicaid: $210 million

• K12 Foundation payment reduction: $300 million

• Other education budget line items: $55 million

• Higher education: $110 million

• All other agencies: $100 million

• Total cuts: $775 million

DeWine stated that, although just 9.4 percent of the Ohio budget is spent on operating expenses of state agencies, he is implementing cost-saving measures including a hiring freeze, a freeze of pay increases, a continuation of the travel freeze already in effect, a freeze on promotions of many state employees, and more.

“And, agencies will suspend purchasing authority for non-essential purchases with continuation of only mission critical contractual services,” he said.

“I have asked each agency director to continue to identify savings in their budgets for the remainder of this fiscal year and next fiscal year.”

By Tom Barr