News
News Home
Quick Bites
Exploradio
News Archive
News Channel
Special Features
NPR
nowplaying
On AirNewsClassical
Loading...
  
School Closings
WKSU Support
Funding for WKSU is made possible in part through support from the following businesses and organizations.

Northeast Ohio Medical University

Knight Foundation


For more information on how your company or organization can support WKSU, download the WKSU Media Kit.

(WKSU Media Kit PDF icon )


Donate Your Vehicle to WKSU

Programs Schedule Make A Pledge Member BenefitsFAQ/HelpContact Us
Economy and Business


Ohio rainy day-fund now has record balance
But many say it came at the expense of local governments and schools
by WKSU's STATEHOUSE BUREAU CHIEF KAREN KASLER


Reporter
Karen Kasler
 
Gov. Kasich watches as $995 million is transferred into the state’s budget stabilization – or rainy-day -- fund.
Courtesy of Karen Kasler
Download (WKSU Only)
In The Region:
The state put a record level of savings in its so-called rainy-day fund, which the governor says is an amazing bounce back from nearly nothing in the account two years ago. Statehouse correspondent Karen Kasler talked with two economic experts who view this move in very different ways.
Ohio rainy day fund now has record balance

Other options:
Windows Media / MP3 Download (2:58)


With a transfer into the rainy day fund of $995 million, Gov. John Kasich says the account is now full, with a record-high balance of $1.48 billion.  Richard Vedder is a professor of economics at Ohio University and a conservative.

“From a good-governance point of view, having a healthy rainy day fund is a good idea. In fact, my only criticism of the current situation is that it’s not even bigger. I would prefer a rainy day fund that is closer to twice the size of what we have.”

Savings at what cost?
Wendy Patton is a researcher on budget and tax issues with the progressive leaning Policy Matters Ohio, and she agrees with Vedder – but only in part.

“A rainy day fund or state savings for hard times is a prudent fiscal measure for any state. I think the issue in Ohio is: Where did the money come from? And based in part on the source, is this a prudent use of those funds?”

Kasich credits good management of state government and an improving economy under his leadership. But Patton says the rainy day money comes from one-time windfalls, including the sale of liquor profits to JobsOhio, and from re-allocations of aid that had gone to local governments. Vedder says it’s more complicated than that, and says that the fact that the state was able to build its rainy day fund up from virtually nothing in 2011 to a record amount now shows that the state’s economy is strong.

Old promises broken
Gov. Kasich has said surpluses can now be used for more tax cuts. Vedder likes that plan. But Patton says the income tax was created in the early 1970s to help local governments, and cutting it while using revenue to build the state’s savings account is hurting them.

“We know that there’s a lot of struggle on the local level. Putting money away for savings instead of using it to support local governments as per a historic deal dating back to the 1970s is not the use of funds that we would advocate at this time in the Ohio economy.”

But Vedder disagrees that those promises need to be preserved now. 

“Those things happened more than four decades ago. And it seems to me that some political deal that was made in 1970 is relatively irrelevant to the current situation almost two generations later.”

This was the third deposit made to the rainy day fund by Kasich – the first, of nearly $247 million, was made in July 2011, at the end of a fiscal year that included the last six months of Democratic former Gov. Ted Strickland’s budget. But the current budget director says Kasich was managing the state by that point, so credit for that improvement belongs to him.
Add Your Comment
Name:

Location:

E-mail: (not published, only used to contact you about your comment)


Comments:




 
Page Options

Print this page

E-Mail this page / Send mp3

Share on Facebook




Stories with Recent Comments

HOF's Canton expansion could take an island and make it a village
I live in the block from Broad St to the Hall of Fame and will be impacted by the expansion. I am in the process of selling my home and planned to long before i...

Cleveland redeploys police to replace rejected red-light traffic cameras
Periodic rotational enforcement without warning does NOT change behavior and the city officials know that. This is the basis of all officer-run enforcement trap...

New enrollment period offers more insurance options
The removal of federal funding for healthcare CO-OPs may limit the growth of the CO-OP movement. http://www.healthcaretownhall.com/?p=6381

The family of Boardman vet killed in Vietnam receives his medals
My name is Mike Eisenbraun. I am Larry's brother. I was 14 years old when Larry was killed in Vietnam. He has been gone for 46 years but it seems like yester...

Cleveland seniors are creating new wealth -- and facing new challenges
Why is anyone surprised that we people over 65 are not retiring? If you have been paying attention, defined company funded pensions were phasing out in the eigh...

Ohio company cuts off a dairy supplier after allegations of animal abuse
these people should be held accountable for their actions. i would be more than pleased to see a year or more behind bars. i will NEVER eat anything that comes ...

Goodyear recruits thousands of vets
What a wonderful interview! Excellent reporting skills by a talented young reporter! I look forward to hearing more from Ms. Schley!

Ohio Democratic Party begins the rebuilding process
I agree 100% with Sen. Brown. I think it is absolutely critical for the Democratic Party in Ohio to engage in the long, tedious, hard task of re-building from t...

They're talking again in the Macedonia bridge dispute
Norfolk Southern says the Ledge road bridge meets regulations for train traffic, however it was built as an overpass for a roadway and/or farm usage. I think t...

Cleveland City Council to consider transgender public restroom law
this is sick. I do not want my daughter in the same bathroom as a perverted 45 year old man. this proposed legislation could seriously damage the security of ch...

Copyright © 2014 WKSU Public Radio, All Rights Reserved.

 
In Partnership With:

NPR PRI Kent State University

listen in windows media format listen in realplayer format Car Talk Hosts: Tom & Ray Magliozzi Fresh Air Host: Terry Gross A Service of Kent State University 89.7 WKSU | NPR.Classical.Other smart stuff. NPR Senior Correspondent: Noah Adams Living on Earth Host: Steve Curwood 89.7 WKSU | NPR.Classical.Other smart stuff. A Service of Kent State University