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

The Holden Arboretum

Hennes Paynter Communications


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

Akron Beacon Journal details abuse claims against televangelist Angley
In the early 90's I went forth for pray. And the man was anointed by the hand of God. Just a fact I will never forget

Lawmaker questions why a million voters didn't get absentee applications
He's a damn lie! I vote n all elections. I missed 1. Haven't gotten my absentee ballot and their making it hard to get one.

Thirsty Dog Brewery warns it might have to leave Akron
Why is it the city's responsibility to find this guy a location? There are a hundred realestate companies that could help him.

Kent State sends home three after contact with second Ebola-stricken nurse
Why weren't all health workers who were around Duncan quaranteened for 21 days and tested for Ebola? That's a no-brainer. Why was Vinson allowed to travel right...

New book says Willoughby Coal is haunted...and that's good for business
Would love to see a series of books that would just thrill me. I cannot wait to visit some of the locations. And revisit some of the locations I have already vi...

Cleveland Indians to continue with 'dynamic pricing'
pricing is too high for a family as well as people like me who are on a fixed income. Bleacher seats are cheaper but concessions are rediculous.

Kasich talks about faith, drugs and education -- but never FitzGerald
The idea that you can learn more by talking to a 90 year old person than from a history book is just another example of how the GOP hates education and knowledg...

Third-grade charter school students fail state testing
A partisan anti-charter group came out with analysis that ODE says is based on incorrect data. So why is this a story? It doesn't seem to rise to WKSU's typic...

Still no money for Fair Finance victims
The only persons benefiting from this bankruptcy is quite obvious - the attorneys.. I would let the Durham and other thieves out of prison in a job with all th...

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