September 10, 2008 - 10:44
News: Ohio

Strickland: national economy to blame for state budget cuts

COLUMBUS - Gov. Ted Strickland said the national economy's performance has put Ohio's budget into deficit and called on President Bush and Congress to stimulate the economy.

Strickland said the national economy has slowed and taken Ohio down with it, reducing tax revenue and creating a $540 million budget shortfall for the final year of the state's biennial budget.

"Certainly the best long-term solution is to get the national and Ohio economies moving again," he said.

In the meantime, Strickland ordered $199 million in budget cuts and $339 million in "cash adjustments" to keep the state's budget in balance. The largest change to the budget is a 4.75 percent cut to the budgets of most state agencies. Strickland said these measures come after $733 million in budget adjustments last January.

Strickland said the state's budget adjustments, tax reforms and energy legislation have made the state one of the most active in the union, but it still needs help from Washington.

"I believe Ohio is doing more today than any other state, but it's past time for a more aggressive and a more vigorous job stimulation package at the federal level," he said.

Strickland said the Bush administration needs to recognize that states' budgets are suffering from the national economy's performance. When asked how important the next president is to Ohio's economy, Strickland said he didn't want to be political but either John McCain or Barack Obama must take action.

"I don't want to get too political in this setting, certainly," he said. "Regardless of who the next president is, they need to make the economy a top priority and they need to recognize the circumstances that the American people are facing and that the individual states are facing."

Strickland said he did not ask the legislature for authority to tap the state's rainy day fund but expects the economy may worsen.

"While it's raining now I fear there is a much larger storm looming ahead of us," he said.

Strickland said he would not categorically rule out a tax increase if the budget continues to remain in deficit, but said there would not be a tax increase.

"I've said I think that would be not helpful to our economy recovery and we will do, as I have done today, continue to make difficult but responsible decisions in the way we are dealing with these matters," he said.

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Justin Miller is a PolitickerOH.com Reporter and can be reached via email at noreply@politicker.com.

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