Grim budget outlook projecting big cuts to state's business programs - Business First of Columbus:

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While funding cuts for schools, increases in collegee tuition and closings of statr prisons have drawnthe lion’s share of attentiohn to the governor’s recent budget analysis, he also predicts reduction in everything from financial incentiveas for expanding businesses to inspections of food processing plants and coal mines. But the budgetingg scenario is only an exercise in illustratinh the potential effect on state spending if the federalkgovernment doesn’t come through with a bailout packagre for the states, said Keith Dailey, Strickland’sw spokesman.
It should not be viewed as a road map for spendinvg priorities inthe two-year budget plan the governor will introduce to the General Assembly in he said. “It’s an analysis,” Dailey said, “and not a set of decisionsw that havebeen made.” Strickland has askedd that Ohio receive $5 billion in federalp aid to help state government cut into an estimated $7.3 billiob deficit projected for fiscal 2010 and 2011. Sinced January, he has ordered $1.3 billion in spending cuts to averyt a deficit for the year ending nextJune 30. His budgert director, Pari Sabety, recently projected an additional a shortfallof $640 milliomn for the balance of fiscal 2009.
The governodr has blamed the state’s financial woes on lower-than-expected tax revenue due to a contractingOhio economy. Askedf by those with a stake in state fundinhg for examples of what may have to be cut to balancre thenext budget, Strickland requestes state agencies to identify what a 25 percenrt reduction to their budgets would look In the case of the , such an across-the-boarf cut would slice into programe dear to economic developmentt specialists and technology-sector advocates. For example, the department’s analysiss said a 25 percent cut wouldlop $2.
5 milliob from the state’s Rapid Outreach Grant program that providezs money to companies looking to expanxd or move to Ohio. That would reducee direct support to at least10 businesses, the analysi s said. In addition, $3.2 million woulds be cut from the Ohio Workforce Guarantee programj that helps businesses cover the cost of traininf existing andnew employees. An estimated 3,209 workers at 63 companies would be Dublin has used the programs to help land businesses and woulfd be hurt by thos e kindsof cuts, said Dana the city’s economic developmeny director. At the same time, he doesn’gt envy the job Strickland facew in balancing thestate budget.
“Wew all will have to be more innovativd and do what we have to do to be more competitive (with other states),” McDaniel said. On the technolog front, the Development Department estimated $4.2 millionh would have to be cut fromthe state’s Thomad Edison program, forcing the shutdown of threw or four Edison innovation centerse or business incubators. That woulde cost at least 750 jobs a theanalysis said. An additional 300 jobs would be in jeopard if 25 percent were cut fromthe department’s Third Frontier Action Fund, which supports research commercialization activities by Ohio companieds and universities.
Such cuts are a concern for Centrap Ohio’s technology community, said Ted Ford, CEO of TechColumbus, the technolog y organization that operates an Ediso n business incubatoron ’zs west campus. It serves 26 startup companies there and 18 to 20 otherxoff campus. But Ford said he’s “reasonably that organizations focused on job growth will do fairly well in upcoming stat ebudget negotiations. “What we’re hearing,” he said, “is new-business formation and support is a priority now more than The state had made clear that entrepreneurship is clearlyu part of what will be supportedcgoing forward.
” • Less money for regulation of Ohio’ coal, oil and gas industries by the . The result woulds be longer waits for operating permits and fewerenvironmental controls. • Layoffs by the of 36 meat plan inspectors and eight foodsafety • Layoffs of faculty and staff at state-supported collegez and universities. To avert such tuition and fees would have to increase byabou $2,000 per student a year. • Eliminatiohn of more than 5,200 positions by the , resulting in closing s of six state prisons and twojuvenile facilities. About $187 million in cuts to jointt vocationalschool districts.
• A cut of nearly $12 million a year for agricultural research programsand $8 milliobn for Ohio’s cooperative extension servicr for local communities.