ODJFS needs between $193-$300 million to balance its budget


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I can’t believe we are still talking about this. I stopped writing about it a couple of months ago because I figured that someone would notice and figure this out. Looks like I was wrong.

As the Dayton Daily News reported yesterday, in the most current version of the budget there still are no plans to pay the Federal government hundreds of millions of dollars of unemployment compensation loan payments we will owe them over the next two years. To review, starting in 2009 the State started receiving unemployment compensation loan payments from the Feds because the State’s unemployment compensation fund was broke but we still needed to pay people their unemployment. The funds were given with the guarantee that the State would repay the loans at a later date in the future. Well, that date is this coming September and then the following September in 2012 and so far this administration has done nothing to find the money to repay the loans.

One of the problems with this issue is that even the amount owed varies dramatically depending on who you ask. If you ask Kasich’s budget director Tim Keene we owe the $303 milion over the next two years. If you ask ODJFS though the total is closer to $190 million over two years. I can not explain the difference between these two numbers. When I asked ODJFS several months ago why there was such a large difference they again stated it was $190 million but than Dir. Keene again used the $303 million number in his testimony before the Senate Finance committee on how he “closed” the budget gap. They can’t both be right so someone is wrong here.

The bigger problem though is that the administration has refused to find any money to pay these loans back. When asked what their plan is if they are forced to do so their answer is always so disturbingly vague.

Gov. John Kasich’s policy director Wayne Struble said the administration has ways of handling the payment if the federal government doesn’t grant a waiver.

“We have to pay it obviously,” Struble said.

Or

Asked if Keen’s first number of $303 million was the result of collaboration between OMB and ODJFS, Johnson confirmed it was.

CGE then inquired about the possible pool of non-GRF sources that could be tapped for the jobless fund loan repayments.

Johnson said the State Administrative Fund is one non-GRF source being looked at. Additional funding sources from Johnson were unavailable for this report.

I mean, they aren’t even attempting to find a way to pay for this. If this was a couple million dollars here or there it really wouldn’t be that big of a deal. The State has a lot of options to cover those sort of expenses but this is potentially $300 million. $300 million! To put this in context Keen told the Conference Committee this week that the State can budget an additional $425 million because of more up-beat projections for tax revenue collections over the next two years. This bill alone to the Federal government would eat up almost 75% of that money. I’m starting to think I’m the only one who sees that this is sort of a big deal and the people in charge have decided to stick their heads in the sand and hope this just goes away.

The administration’s policy of sticking its head in the sand might be their actual strategy though. As my colleague pointed out so well earlier today, the extra $1.1 billion that the administration has and refuses to let anyone have any of is going to most likely be the hose that will put out this fire. The administration is going to continue to say that they closed a budget gap by not having to repay back these loans, which is clearly a lie at this point. There is no such agreement. They get to count those as “savings” and then when the bill comes due they are going to have to use the $1.1 billion in “surplus” to pay it. Will someone who actually, you know, writes laws, please ask the administration how they plan to pay this back? Thanks.

 

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