Ohio state budget and finances

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Ohio budget and finances
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General information
Budget calendar:
Biennial
Fiscal year:
2015
State credit rating:
AA+ (as of 2014)
Current governor:
John Kasich
Financial figures
Total spending (state and federal funds):
$59.1 billion (estimated for 2014)
Per capita spending:
$5,096.44 (estimated for 2014)
Total state tax collections:
$27.3 billion (2013)
Per capita tax collections:
$2,361.82 (2013)
State debt:
$321.3 billion (as of 2014)
Per capita state debt:
$27,836 (as of 2014)
State budgets and finances
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Total state expendituresState debtTax policy in Ohio
Note: This page utilizes information from a variety of sources. As such, the currency of the information varies somewhat. The information presented on this page reflects the most recent data available as of February 2015.

Between fiscal years 2013 and 2014, total government spending in Ohio increased by approximately $3 billion, from $56.1 billion in fiscal year 2013 to an estimated $59.1 billion in 2014. This represents a 5.4 percent increase. The cumulative rate of inflation during the same period was 1.58 percent, calculated using the Consumer Price Indices for January 2013 and January 2014. As of 2014, financial services firm Standard and Poor's had assigned Ohio a credit rating of AA+.[1][2][3]

Although Ohio had the seventh highest total estimated expenditures in 2014, its per capita spending ranked 18th lowest in the nation.

Spending

Definitions

The information below comes from the National Association of State Budget Officers (NASBO). These spending figures are broken into three broad categories in order to facilitate comparison between the states.[3]

  • State funds: State funds include general and other state-based funds. A general fund is "the predominant fund for financing a state's operations." Other state funds are "restricted by law for particular governmental functions or activities."
  • Federal funds: Federal funds are "funds received directly from the federal government."
  • Total spending: Total spending is calculated by adding together the totals for state and federal funds.

These figures exclude spending from the sale of bonds.

2014 expenditures

See also: Total state expenditures

The table below breaks down estimated spending totals for fiscal year 2014 (comparable figures from surrounding states are included to provide additional context). Figures for all columns except "Population” and “Per capita spending" are rendered in millions of dollars (for example, $2,448 translates to $2,448,000,000). Figures in the columns labeled "Population” and “Per capita spending" have not been abbreviated.[3]

In 2014 Ohio had the second lowest per capita spending, at $5,096.44, when compared to neighboring states.

Total estimated state spending, FY 2014 ($ in millions)
State State funds Federal funds Total spending Population Per capita spending
Ohio $46,043 $13,046 $59,089 11,594,163 $5,096.44
Illinois $50,392 $19,964 $70,356 12,880,580 $5,462.18
Indiana $17,282 $9,978 $27,260 6,596,855 $4,132.27
Michigan $30,605 $20,632 $51,237 9,909,877 $5,170.30
Wisconsin $33,887 $11,006 $44,893 5,757,564 $7,797.22
Per capita figures are calculated by taking the state's total spending and dividing by the number of state residents according to United States Census estimates.[4]
Source: National Association of State Budget Officers

Spending by function

See also: State spending by function as a percent of total expenditures
Breakdown of spending by function in FY 2013.
Source: National Association of State Budget Officers

State spending in Ohio can be further broken down by function (elementary and secondary education, public assistance, etc.). Fiscal year 2013 information is included in the table below (information from neighboring states is provided for additional context). Figures are rendered as percentages, indicating the share of the total budget spent per category.[3]

In fiscal year 2013, Ohio reported the lowest spending on transportation as a percent of total expenditures (5.1 percent) when compared to its neighboring states.

State spending by function as a percent of total expenditures, FY 2013
State K-12 education Higher education Public assistance Medicaid Corrections Trans-
portation
Other
Ohio 17% 4.3% 1.5% 29.2% 3.2% 5.1% 39.8%
Illinois 13.3% 3.7% 0.3% 23.8% 2.1% 8.4% 48.4%
Indiana 30.8% 6.1% 1.4% 31.2% 2.7% 8.3% 19.6%
Michigan 27.2% 4.2% 0.7% 26.4% 4.6% 7.8% 29%
Wisconsin 16.2% 14.3% 0.3% 17.2% 2.9% 6.9% 42.1%
Source: National Association of State Budget Officers
Note**: "Other" expenditures include "Children's Health Insurance Program (CHIP), institutional and community care for the mentally ill and developmentally disabled, public health programs, employer contributions to pensions and health benefits, economic development, environmental projects, state police, parks and recreation, housing and general aid to local governments."[3]

Spending trends

Between 2009 and 2013, spending on K-12 education in Ohio dropped from 19.2 percent in 2008 to 17.0 percent in 2013. Meanwhile, spending on Medicaid rose from 23.2 percent in 2008 to 29.2 percent in 2013. See the table below for further details (figures are rendered as percentages, indicating the share of the total budget spent per category).[3][5][6][7][8]

Spending by function from 2009 to 2013 (as percentages)
Year K-12 education Higher education Public assistance Medicaid Corrections Transportation Other
2013 17.0% 4.3% 1.5% 29.2% 3.2% 5.1% 39.8%
2012 20.6% 4.2% 1.5% 24.4% 3.1% 5.1% 41.2%
2011 17.7% 4.6% 1.7% 23.2% 3.2% 4.9% 44.7%
2010 20.2% 4.9% 1.8% 21.3% 3.4% 4.9% 43.5%
2009 21.7% 5.2% 2.2% 24.3% 3.4% 7.3% 35.9%
2008 19.2% 5.3% 2.3% 23.2% 3.6% 7.4% 39.0%
Source: National Association of State Budget Officers
Note**: "Other" expenditures include "Children's Health Insurance Program (CHIP), institutional and community care for the mentally ill and developmentally disabled, public health programs, employer contributions to pensions and health benefits, economic development, environmental projects, state police, parks and recreation, housing and general aid to local governments."[3]

Revenues

2013 revenues

See also: State government tax collections by source

The table below breaks down state government tax collections by source in 2013 (comparable figures from surrounding states are also provided to give additional context). Figures for all columns except "Population" and "Per capita revenue" are rendered in thousands of dollars (for example, $2,448 translates to $2,448,000). Figures in the columns labeled "Population" and "Per capita revenue" have not been abbreviated.[9]

In 2013, Ohio had the lowest per capita tax collections ($2,361.82) when compared to nearby states.

State tax collections by source ($ in thousands)
State Property taxes Sales and gross receipts Licenses Individual income taxes Corporation net income taxes Other taxes Total 2013 population Per capita collections
Ohio N/A $13,636,046 $3,445,620 $9,869,545 $262,226 $117,511 $27,330,948 11,572,005 $2,361.82
Illinois $61,806 $14,705,739 $2,583,108 $16,538,662 $4,462,627 $363,378 $38,715,320 12,890,552 $3,003.39
Indiana $7,008 $10,298,491 $699,373 $4,976,375 $781,585 $167,899 $16,930,731 6,570,713 $2,576.70
Michigan $1,954,898 $12,268,026 $1,454,634 $8,239,086 $900,667 $265,343 $25,082,654 9,898,193 $2,534.06
Wisconsin $148,600 $7,088,411 $1,035,743 $7,227,690 $955,752 $66,416 $16,522,612 5,742,953 $2,877.02
Source: Tax Policy Center, "State Tax Collection Sources 2000-2013," June 20, 2014
Ohio tax collections by source in 2013.
Source: Tax Policy Center

The table below lists 2013 tax collections by source as percentages of total collections. When compared to neighboring states, Ohio had the largest percentage of tax collections from licenses at 12.61 percent.[9]

State tax collections by source (as percentages)
State Property taxes Sales and gross receipts Licenses Individual income taxes Corporation net income taxes Other taxes
Ohio N/A 49.89% 12.61% 36.11% 0.96% 0.43%
Illinois 0.16% 37.98% 6.67% 42.72% 11.53% 0.94%
Indiana 0.04% 60.83% 4.13% 29.39% 4.62% 0.99%
Michigan 7.79% 48.91% 5.80% 32.85% 3.59% 1.06%
Wisconsin 0.90% 42.90% 6.27% 43.74% 5.78% 0.40%
Source: Tax Policy Center, "State Tax Collection Sources 2000-2013," June 20, 2014

Current fiscal year budget

See also: Historic Ohio budget and finance information

Fiscal years 2014 and 2015

DocumentIcon.jpg See budget bill: HB 59

Ohio state budget -- 2014-2015
Ohio State Legislature
Text:HB 59
Legislative history
Introduced:February 12, 2013
House:April 18, 2013
Vote (lower house):61-35
Senate:June 6, 2013
Vote (upper house):23-10
Conference:June 27, 2013
Conference vote (upper house):21-11
Conference vote (lower house):53-44
Governor:John Kasich
Signed:June 30, 2012

Governor John Kasich signed into law the biennial budget covering fiscal years 2014 and 2015 on June 30, 2013. The budget totaled approximately $62 billion and included a $2.6 billion reduction in personal income tax (this reduction was expected, over the course of three years, to amount to a 10 percent reduction). The budget as signed also provided for an increased sales tax rate (from 5.50 to 5.75 percent).[10]

The budget also included an abortion provision that "effectively [stripped] funding from Planned Parenthood, [blocked] public hospitals from arranging transfer agreements with abortion clinics, and [required] abortion providers to provide ultra sounds on women seeking abortions."[10]

On June 16, 2014, Kasich signed into law a mid-biennium budget review, which included spending adjustments. These included "new initiatives to help high school dropouts, $10 million for cooperative mentoring efforts, $47.5 million in additional funds for mental illness and addiction and $26.9 million for tobacco prevention and cessation programs.[11]

State debt

See also: State debt

According to a January 2014 report by the nonprofit organization State Budget Solutions, Ohio had a state debt of approximately $321.3 billion. Its state debt per capita was $27,836. The report revealed that state governments faced a combined $5.1 trillion in debt. The obligation amounted to $16,178 per capita in the nation.[12]

Total state debt, 2014
State Total state debt State debt per capita Per capita debt ranking
Ohio $321,340,764,000 $27,836 4
Illinois $321,354,115,000 $24,959 5
Indiana $46,377,635,000 $7,094 48
Michigan $142,668,026,000 $14,435 25
Wisconsin $45,026,643,000 $7,863 47
Sources: State Budget Solutions, "State Budget Solutions' Fourth Annual State Debt Report," January 8, 2014

Public pensions

See also: Ohio public pensions and Ohio public employee salaries

A 2012 report from the Pew Center on the States noted that Ohio's pension system was funded at 67 percent at the close of fiscal year 2010, well below the 80 percent funding level experts recommend. Consequently, Pew designated the state's pension system as cause for "serious concern."[13]

Taken together, the funding ratio for the state's pension systems decreased from 82.28 percent in fiscal year 2006 to 67.35 percent in fiscal year 2011, a decrease of 14.93 percentage points, or 18.1 percent. Likewise, unfunded liabilities increased from just under $30 billion in fiscal year 2006 to more than $70 billion in fiscal year 2011.[14][15][16][17][18]

Credit ratings

See also: State credit ratings

Credit rating agencies, such as Standard and Poor's, assign grades to states that take into account a state's ability to pay debts and the general health of the state's economy. Generally speaking, a higher credit rating indicates lower interest costs on the general obligation bonds states sometimes sell to investors in order to finance large-scale undertakings (e.g., road construction and other public works projects). This in turn results in lower interest costs, thereby lowering the cost to taxpayers.[19][20]

The table below lists the Standard and Poor's credit ratings for Ohio and surrounding states from 2004 to 2014. Standard and Poor's grades range from AAA, the highest available, to BBB, the lowest.[21]

State credit ratings, 2004 to 2014
State 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004
Ohio AA+ AA+ AA+ AA+ AA+ AA+ AA+ AA+ AA+ AA+ AA+
Illinois A- A- A A+ A+ A+ AA AA AA AA AA
Indiana AAA AAA AAA AAA AAA AAA AAA AA+ AA+ AA AA
Michigan AA- AA- AA- AA- AA- AA- AA- AA- AA AA AA+
Wisconsin AA AA AA AA AA AA AA AA- AA- AA- AA-
Source: Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2014," June 9, 2014

Federal aid to the state budget

See also: Federal aid to state budgets

State governments receive aid from the federal government to fund a variety of joint programs, such as Medicaid. Federal aid varies considerably from state to state. For example, Mississippi received approximately $7.7 billion in federal aid in 2012, which accounted for more than 45 percent of the state's general revenues. By contrast, Alaska received roughly $2.9 billion in federal aid in 2012, just under 20 percent of the state's general revenues.[22]

The table below notes what share of Ohio’s general revenues came from the federal government in 2012. That year, Ohio received approximately $20.7 million in federal aid, 34.9 percent of the state's total general revenues. Figures from surrounding states are provided for additional context.[22]

Federal aid to state budgets, 2012
State Total federal aid ($ in thousands) Federal aid as a % of general revenue Ranking
Ohio $20,687,909 34.88% 17
Illinois $15,646,844 25.66% 43
Indiana $10,441,125 32.32% 29
Michigan $17,849,942 33.76% 24
Wisconsin $8,855,079 28.19% 38
Source: United States Census Bureau, "State Government Finances: 2012," accessed February 24, 2014

Stimulus

Between February 2009 and June 2013, Ohio received $7,873,180,000.00 in federal funding.[23]

Budget process

The state operates on a biennial budget cycle. The sequence of key events in the budget process is as follows:[24][25]

  1. Budget instruction guidelines are sent to state agencies in July of the year preceding the start of the new biennium.
  2. State agencies submit their requests to the governor in September and October.
  3. Agency hearings are held in October and November.
  4. The governor submits his or her proposed budget to the state legislature in February (this deadline is extended to mid-March for a newly-elected governor).
  5. The legislature typically adopts a budget in June. A simple majority is required to pass a budget. The biennium begins July 1 of odd-numbered years.

Ohio is one of 44 states in which the governor has line item veto authority.[25]

The governor is legally required to submit a balanced budget proposal. Likewise, the state legislature is legally required to pass a balanced budget.[25]

Agencies, offices and committees

The following standing committees in the Ohio State Legislature deal with budget and finance matters:

  1. Finance Committee, Ohio House of Representatives
  2. Finance Committee, Ohio State Senate

The Ohio Auditor of State is responsible for auditing all public offices in Ohio, encompassing more than 6,500 entities including cities, counties, villages, townships, schools, state universities and public libraries, as well as all state agencies, boards and commissions.[26]

Studies and reports

U.S. PIRG "Following the Money" report

See also: "Following the Money" report, 2014

The U.S. Public Interest Research Group, a consumer-focused nonprofit organization based in Washington, D.C., released its annual report on state transparency websites in April 2014. The report, entitled "Following the Money," measured how transparent and accountable state websites are with regard to state government spending.[27] According to the report, Ohio received a grade of D- and a numerical score of 51, indicating that Ohio was "lagging" in terms of transparency regarding state spending.[27]

Contact information

Ohio Office of Budget and Management
30 East Broad Street, 34th Floor
Columbus, Ohio 43215
Telephone: 614-466-4034

Budget and finance ballot measures

Voting on
state and local
government budgets,
spending and finance
State finance.jpg
Policy
Budget policy
Ballot measures
By state
By year
Not on ballot
See also: State and local government budgets, spending and finance on the ballot and List of Ohio ballot measures

Ballotpedia has tracked the following ballot measures relating to state and local budget and financial matters in Ohio.

  1. Ohio Debt Limitations, Issue 4 (1977)
  2. Ohio Government Debt Limitations, Amendment 2 (1922)
  3. Ohio Higher Education Loans, Amendment 1 (May 1965)
  4. Ohio Industrial Development Loans, Amendment 4 (May 1965)
  5. Ohio Issue 1, Generators Act (June 1980)
  6. Ohio Issue 1, Housing Assistance Act (1990)
  7. Ohio Payment of Debt by Political Divisions, Amendment 6 (June 1976)
  8. Ohio Political Subdivisions Debt Level Restrictions, Amendment 1 (1925)
  9. Ohio Rail Systems Financing, Amendment 8 (1975)
  10. Ohio Rail Transportation Services, Amendment 2 (June 1976)
  11. Ohio School and Ministerial Funds, Amendment 1 (May 1968)
  12. Ohio Tax Limitations, Referendum 1 (1923)

Recent news

This section displays the most recent stories in a Google news search for the terms "Ohio budget."

Some of the stories below may not be relevant to this page due to the nature of Google's news search engine.

Ohio state budget and finances - Google News Feed

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See also

External links

Additional reading

References

  1. Bureau of Labor Statistics, "CPI Detailed Report Data for February 2014," accessed April 9, 2014
  2. InflationData.com, "Cumulative Inflation Calculator," February 28, 2014
  3. 3.0 3.1 3.2 3.3 3.4 3.5 3.6 National Association of State Budget Officers, "State Expenditure Report: 2012-2014," accessed February 18, 2015
  4. United States Census Bureau, "State and County QuickFacts," accessed February 23, 2014
  5. National Association of State Budget Officers, "State Expenditure Report, 2009-2011," accessed February 24, 2014
  6. National Association of State Budget Officers, "State Expenditures Report, 2010-2012," accessed February 24, 2014
  7. National Association of State Budget Officers, "State Expenditure Report, 2009," accessed February 24, 2014
  8. National Association of State Budget Officers, "State Expenditure Report, 2008," accessed February 24, 2014
  9. 9.0 9.1 Tax Policy Center, "State Tax Collection Sources 2000-2013," June 20, 2014
  10. 10.0 10.1 Reuters, "Ohio governor signs budget including tax cut, anti-abortion provision," June 30, 2013
  11. National Association of State Budget Officers, "Summaries of Fiscal Year 2015 Proposed and Enacted Budgets," July 11, 2014
  12. State Budget Solutions, "State Budget Solutions' Fourth Annual State Debt Report," January 8, 2014
  13. Pew Center on the States, "Widening Gap Update: Ohio," June 18, 2012
  14. Ohio Public Employees Retirement System, "2012 Comprehensive Annual Financial Report," accessed November 18, 2013
  15. The School Employees Retirement System of Ohio, "2012 Comprehensive Annual Financial Report," accessed November 18, 2013
  16. State Teachers Retirement System of Ohio, "2012 Comprehensive Annual Financial Report," accessed November 18, 2013
  17. Ohio Police and Fire Pension Fund, "2012 Comprehensive Annual Financial Report," accessed November 18, 2013
  18. Highway Patrol Retirement System, "2012 Comprehensive Annual Financial Report," accessed November 18, 2013
  19. Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2012," July 13, 2012
  20. Bankrate, "The 6 states with the worst credit ratings," September 27, 2012
  21. Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2014," June 9, 2014
  22. 22.0 22.1 United States Census Bureau, "State Government Finances: 2012," accessed February 24, 2014
  23. Recovery.gov, "Stimulus Spending by State," accessed February 21, 2014
  24. National Conference of State Legislatures, "State Experiences with Annual and Biennial Budgeting," updated April 2011
  25. 25.0 25.1 25.2 National Association of State Budget Officers, "Budget Processes in the States, Summer 2008," accessed February 21, 2014
  26. Ohio Auditor of the State, "Home page," accessed November 5, 2009
  27. 27.0 27.1 U.S. Public Interest Research Group, "Following the Money 2014 Report," accessed April 15, 2014