Columbus — Republican Gov. John Kasich’s administration reported a fourth budget surplus in as many years July 1, the second day of the new state fiscal year.
The state Office of Budget and Management placed the latest surplus at nearly $800 million. The surplus was $2.1 billion in fiscal 2013, $235 million in fiscal ‘12 and $292 million in fiscal ‘11.
State Budget Director Tim Keen attributed the latest total to higher-than-expected tax collections and lower-than-expected Medicaid and other spending.
“Ohio’s finances are sound, we’re in good financial position, and I am confident that they will continue to remain so through [fiscal 2015],” Keen said.
The budget surplus was expected, and plans for spending a portion of it were set in mid-biennium budget legislation passed by lawmakers and signed into law by Kasich last month.
A portion will be used for a package of tax cuts for individual and business filers. That total includes $229 million for an increase in tax cuts for small businesses, $91 million for an acceleration of an earlier-announced personal income tax cut and $76 million for increases in personal exemptions and earned income tax credits for low- and middle-income filers.
“For the fourth year in a row, the state of Ohio has balanced its budget and produced a significant budget surplus, with tax revenues exceeding estimates and state spending kept below projections,” Keen said in a released statement. “Gov. Kasich and his partners in the general assembly are providing Ohio strong leadership and it’s helping generate economic growth. Together with careful stewardship of taxpayers’ resources, Ohio’s jobs-friendly policies are producing good results for the budget, for job creation and are helping get Ohio back on track.”
One liberal think tank has a different take on the surplus, however. Policy Matters Ohio says new tax cuts outlined in the mid-biennium budget will benefit the wealthy, and the state should be directing more dollars toward local governments.
“The mid-biennium review also continues an unfortunate Ohio tradition of permitting or enlarging tax benefits to special, narrow groups of taxpayers,” research director Zach Schiller said in a released statement. “We should review the tax breaks we have now.”
He added, “Instead of more tax cuts, we should restore and expand funding to local governments, public schools, health and human services and post-secondary education.”
Marc Kovac is the Dix Capital Bureau Chief. Email him at email@example.com or on Twitter at OhioCapitalBlog.