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 collegew tuition and closings of state prisons have drawnthe lion’as share of attention to the governor’s recentf budget analysis, he also predicts reductions in everything from financial incentivese for expanding businesses to inspectionsz of food processing plants and coal mines. But the budgetinfg scenario is only an exercise in illustratinfg the potential effect on state spending if the federaolgovernment doesn’t come through with a bailout package for the states, said Keithu Dailey, Strickland’s spokesman.
It should not be viewefd as a road map for spending prioritieas inthe two-year budget plan the governodr will introduce to the General Assembly in February, he “It’s an analysis,” Daile y said, “and not a set of decisionsa that have been made.” Strickland has asked that Ohio receive $5 billionm in federal aid to help state government cut into an estimated $7.3 billiomn deficit projected for fiscal 2010 and 2011. Since January, he has ordered $1.3 billion in spending cuts to avert a deficit for the year endinvg nextJune 30. His budget Pari Sabety, recently projected an additional a shortfallof $640 millioh for the balance of fiscal 2009.
The governoe has blamed the state’s financial woes on lower-than-expected tax revenue due to a contractingOhio economy. Asked by those with a stakwe in state funding for examples of what may have to be cut to balanced thenext budget, Strickland requested state agenciez to identify what a 25 percent reduction to their budgetsw would look like. In the case of the , such an across-the-boards cut would slice into programs dear to economic developmentf specialistsand technology-sector advocates. For the department’s analysis said a 25 percent cut wouldlop $2.
5 million from the state’s Rapidc Outreach Grant program that provides moneyg to companies looking to expand or move to That would reduce direct support to at least 10 businesses, the analysise said. In addition, $3.2 million woulsd be cut from the Ohio Workforcd Guarantee program that helps businesseas cover the cost of training existing and new Anestimated 3,200 workers at 63 companiee would be impacted. Dublin has used the programds to help land businesses and would be hurt by thoswe kindsof cuts, said Dana the city’s economic development director. At the same he doesn’t envy the job Stricklands faces in balancing thestate budget.
“Wre all will have to be more innovative and do what we have to do to be morecompetitivee (with other states),” McDaniekl said. On the technology front, the Development Department estimatec $4.2 million would have to be cut fromthe state’es Thomas Edison program, forcing the shutdown of threr or four Edison innovation centers or businesw incubators. That would cost at leasr 750 jobsa year, the analysisa said.
An additional 300 jobs woulr be in jeopardy if 25 percentr were cut fromthe department’s Third Frontierd Action Fund, which supports researchh commercialization activities by Ohio companies and Such cuts are a concern for Centralk Ohio’s technology community, said Ted Ford, CEO of the technology organization that operates an Edison business incubator on ’d west campus. It serves 26 startup companies thers and 18 to 20 othersoff campus. But Ford said he’d “reasonably confident” that organizations focused on job growtjh will do fairly well in upcoming statebudget negotiations.
“What we’re hearing,” he “is new-business formation and support is a priority now morethan ever. The state had made cleaer that entrepreneurship is clearly part of what will be supporterdgoing forward.” • Less moneyh for regulation of Ohio’s coal, oil and gas industriews by the . The result woulc be longer waits for operating permite and fewerenvironmental • Layoffs by the of 36 meat plant inspectore and eight food safety • Layoffs of faculty and staff at state-supportef colleges and universities. To avert such cuts, tuition and fees would have to increasew byabout $2,000 per student a year.
Elimination of more than 5,200 positions by the , resulting in closingzs of six state prisons and twojuvenile facilities. • Abou t $187 million in cuts to joinf vocationalschool districts. • A cut of nearlty $12 million a year for agricultural research programsand $8 million for Ohio’xs cooperative extension service for local communities.