Ohio Officials Announce Budget Shortfall

COLUMBUS, Ohio—State leaders are facing a critical financial problem as the state budget has come up nearly $1 billion short.

The state is facing a possible budget shortfall of at least $600 million and those figures could rise to $900 million for the budget ending June 30.

Gov. Ted Strickland has already made $2 billion in cuts, but low income tax filings have made the already difficult situation dire.

The Ohio Department of Taxation released some staggering numbers Tuesday, showing the state’s financial issues are far from over.

“Obviously our most pessimistic scenarios that gave us our forecast last December weren’t pessimistic enough,“ said Pari Sabety, director of the Office of Budget and Management.

State leaders reported April’s income tax revenue fell short of projections by $322 million—a decrease of 22 percent.

The Department of Taxation told NBC 4 Tuesday that Ohio’s job losses, along with a troubled stock market and declining home values contributed to a number that no one could supposedly predict.

“There had to be some way to see these numbers would be this drastic?“ Diedrich asked.

“I think it would have been very difficult to anticipate and I don’t fault anyone. We just have to take them as they are, deal with them in a constructive manner,“ said Sen. Dale Miller.

Strickland and other legislators are pointing to the state’s $948 million rainy day fund to balance the current budget, despite the fund already being allotted for the 2010-2011 budget.

“With less than two months to go in fiscal year I don’t think there are other options to balance the fiscal ‘09 budgets. The rainy day (fund) is going to have to be used as part of it,“ Miller said.

Strickland said he plans to discuss the option, “and other possible solutions with Senate President Bill Harris, House Speaker Armond Budish and other legislative leaders in the coming weeks.“

While this year’s budget is currently under the microscope for its $600 million shortfall, State Auditor Mary Taylor said Ohio is going to face even more financial trouble in the future.

Taylor announced in April that she believes the state will have an $8 billion budget shortfall in three years.

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