August Budget Report Card: Month 2 of 24


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This week, Governor Kasich’s budget office released its monthly financial report for August, revealing how state revenue collections and spending had done in the second month of the new two-year budget cycle.

Revenue collections were $1,948 million, which OBM notes is $7.7 million above estimates. State spending came in at $1,752 million, which OBM reports is 7.8% below their estimates for the month. Curiously, the Legislative Services Commission complained in its companion monthly report that OBM did not provide month-by-month projections of spending, so there is no independent verification.

Adding it all up, the state spent $196 million less than it brought in. When coupled with our calculation from last month that July ended with a shortfall of $907 million in the General Fund, it appears that, as of the end of August, the GRF is currently running a $712 million deficit.

As we pointed out last month, the state is allowed to operate at a deficit in the general fund, as long as it doesn’t exceed 10% of the prior year’s revenue collections. So we are well short of the point where a new budget will be required, but we have to imagine that part of the reason the Kasich administration has not released its month-by-month spending forecasts is that they continue to revise their spending plans to postpone purchases until revenue picks up and they can get themselves out of the hole.

On the whole, we’re pleased to see the direction of the GRF balance head north, even if the number is still negative. It means a new budget and more cuts are not yet imminent, but the Governor is still hinting that he’d like to take another crack at it. We’ll also feel better when we can get a 2-year spending plan and independent review by the nonpartisan Legislative Services Commission.

Final Grade: Incomplete.

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