The Ohio budget that was signed into law at the end of last month was not perfect, and neither is the budget process. But after all the ideas, testimony and alternatives were weighed, I think it is a budget that will continue to move Ohio in the right direction.
And Ohio is headed in the right direction.
One way to consider evaluating Ohio's financial situation is to consider it as a "turn around" business with a $30 billion per year budget. Compared to the state's financial position just three years ago, the transformation that has taken place is exceptional. While we would all agree that there is still a long way to go, I am pleased by the progress that has been made and expect it to continue.
Since the beginning of the previous budget cycle in early 2011, Ohioans have created more than 170,000 jobs. Those jobs provide opportunities for people to make their own individual decisions and lead to an increase in total wealth in our state. Because people who pay taxes first have to earn the money, cutting income taxes on income earners and small businesses was the responsible thing to do. It will make Ohio more competitive in attracting new business and will help existing Ohio businesses grow.
The growth in wealth created and the jobs that create the wealth makes it possible to fund important public institutions, such as schools. This budget increases funding for nearly 70 percent of the school districts in Ohio, and 80 percent of the students in the state will be attending schools receiving greater funding. No school district is getting less than they did last year. This was possible because we have a growing economy that produces jobs.
It is also important to have funds on hand should the state experience an economic downturn in the future. Governor Kasich recently announced that an additional $996 billion is being put in the rainy day fund, expanding it to a total of $1.48 billion. This fund is analogous to ensuring adequate working capital in a business. In an economic downturn in the past, the state was forced to cut spending for schools and infrastructure. The $1.48 billion in our state’s "balance sheet" will allow continued funding of critical services when the tax revenue fluctuates.
In government, there is always pressure for money to be spent. In the future, the Legislature must be more assertive earlier in the budgeting process so that more weight is given to consideration of services that the people wish to expand and as important, to the reduction or eliminating programs that no longer serve the public interest or are no longer important enough to compete for funding.
The state budget impacts everyone. I think this budget is a positive step forward for Ohio, and I was proud to support it.