Governor Strickland Fails To Explain Impact Of 2005 Tax Reduction Act On Ohio’s 2009 Budget Shortfall

I’m mystified why Governor Strickland, a Democrat, in analyzing Ohio’s current budget crisis, completely ignores the impact of the Tax Reduction Act implemented via complete Republican domination in 2005.

This Tax Reduction Act was phased in over a five year period. This year, at the same time that Ohio is going hat in hand to the federal government for a hand out, Ohio, as a result of that 2005 law, is giving itself additional tax cuts. The 2005 law cut Ohio income taxes, across the board, by 21% and corporate and business taxes by about 50%.

As with Bush’s tax cuts at the national level, in Ohio, the Republican legislation gave Ohio’s wealthiest citizens the lion’s share of the income tax cut, with 26% of the income tax reductions going to incomes in excess of $340,000.

Governor Strickland in his State of the State Speech implied that the shortfall in Ohio’s budget is completely the result of the recession. But the 2005 tax cuts contribute to Ohio’s budget shortfall as well.

In Ohio’s 2005 Tax Reduction Act Was Predicted, By 2010, To Result In Yearly State Budget Shortfall of Billions, I wrote about a study published in 2005 that predicted that even in a normal economy, the Tax Reduction Act would cause budget shortfalls. The study said, “Massive cuts in state spending, or alternative tax increases, will be required to make up for the revenue shortfall of about $2.8 billion in 2010, the fifth and final year of the tax reform plan’s phase out period.”

The big economic downturn has made Ohio’s budget shortfall worse, but, the fact that now Ohio is experiencing a budget shortfall was predicted in 2005. It appears that part of the overall Republican strategy behind the 2005 Tax Reduction Act was the fact that budget shortfalls, caused by reduced state revenues, would force a shrinkage of government.

Strickland in his speech said, “For the first time in a half century, Ohio’s general revenue taxes have declined two years in a row. We now forecast that the general revenue taxes available to the state of Ohio will be lower in the 2011 fiscal year than they were seven years earlier.”

But not a word about the impact of the 2005 Tax Reduction Act that reduced state revenues by $2.2 billion and of that amount gave $570 million per year to incomes in excess of $340,000.

Strickland in his speech sounded very Republican when he said, “So in this budget, I must ask all Ohioans to accept the sacrifices that these times demand. In order to protect the priorities most important to Ohio’s future, we have no choice but to reduce a significant number of programs and services.”

Strickland is wrong to imply that sacrifices and reductions in Ohio’s programs and services — particularly to the poor — is simply a result of “these times.”

Strickland said, “We will strengthen Ohio by continuing the implementation of the tax reforms of 2005.”  If Strickland wishes to defend the 2005 Tax Reduction Act — including its handout to the wealthy — then he should defend it in an honest way. Strickland missed a good opportunity in his state of the state address to inform and educate the public about the impact this 2005 law has had on Ohio’s current budget shortfall.


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Governor Strickland Offers Five Point Plan To “Build Ohio’s Education System Anew”

Governor Ted Strickland, dedicated a big part of his State of the State speech today giving details of his five point plan to “build our education system anew.”

Strickland said, “The plan is based on a very simple premise: we should design our education system around what works. I have embraced an evidence-based education approach that harnesses research results and applies those findings to Ohio’s specific circumstances.”

Here is what Strickland said about his five points:

First, what we teach and how we teach will prepare Ohioans to thrive in the 21st Century.

  • Students will, of course, continue to learn the timeless core subjects like math and science that are critical to their success. But we will also add new topics including global awareness and life skills to the curriculum. And we will use teaching methods that foster creativity and innovation, critical thinking and problem solving, communication and collaboration, media literacy, leadership and productivity, cultural awareness, adaptability and accountability.
  • These are the skills that help people thrive in their lives. These are the skills our business leaders look for in the people they hire. These are the skills we find in people who create jobs, create products, and create entirely new industries.
  • Under my plan, the Ohio Department of Education will set standards for Ohio schools requiring innovative teaching formats. Interdisciplinary methods, project-based learning, real world lessons, and service learning will be the norm.

Second, under my plan, we will expand learning opportunities.

  • The learning experience will be built around the individual student. Lessons will not end when a fact is memorized. Students will be given a chance to interact with information, to follow up on the subjects that fascinate, to think critically and creatively and to use what they’ve learned to draw conclusions.
  • Our schools are not assembly lines and our students are not widgets. We will teach to each individual student’s need because we recognize that it is the surest path to seeing our young people reach their full potential.
  • Over a ten-year period we will add 20 instructional days to the school calendar – bringing Ohio’s learning year up to the international average of 200 days.
  • We will end the outdated practice of giving our most impressionable students only a half-day of learning. Ohio will now require universal all-day kindergarten.
  • We will provide resources to expand the learning day for all students with activities such as community service, tutoring, and wellness programs.
  • We will build on our ‘Closing the Achievement Gap’ initiative to take what we’ve learned from the existing program to help us provide enhanced intervention services in schools with high dropout rates.
  • We will create community engagement teams in our schools. We will place nurses in our schools. We will have professionals in the schools who will help educators, families and community service providers come together to help our children succeed.
  • And for the first time the state will provide dedicated resources for instructional materials and enrichment activities.
  • We will celebrate learning with new academic achievement competitions and awards that make learning as publicly praised as athletics. With the creation of the Ohio Academic Olympics, students will compete in science, in math, in writing, in debate, in the arts, and in technology.

Third, under my plan, we will improve educator quality.

  • There is simply nothing that we as policymakers can influence in our schools that is as consequential as providing top quality teachers for our students.
  • We will revolutionize teacher preparation and development in Ohio with a residency program. Just as future doctors begin their careers under the watchful eye of an experienced colleague, we will give our new teachers the benefit of thoughtful guidance from an accomplished senior teacher. After a four-year residency, successful candidates will earn their professional teaching license.
  • We will recognize the development of a teacher’s skills and accomplishments with a career ladder that begins with their residency and can build up to lead teacher, a person whose credentials, experience, and student results warrant additional responsibilities. That means for the first time our teachers will have the opportunity to advance their careers based on objective evidence of student progress.
  • Our lead teachers will play an active role in overseeing new teachers in the residency program and assisting all their colleagues.
  • We will provide collaborative planning time so that the best ideas of the best teachers can spread across a school and reach the most students. Mentoring, coaching and peer review will be a standard part of a teacher’s job.
  • We will harness the expertise of the Chancellor of Higher Education and the Superintendent of Public Instruction to collaborate on professional development programs and innovative techniques for the classroom.
  • We will create a Teach Ohio program to open a path to licensure for professionals who have the subject knowledge but lack coursework in education methods. Teach Ohio participants will complete an intensive course in classroom methods and then be eligible to begin the four-year residency program.
  • Scholarships will be made available for future teachers who agree to teach in hard to staff schools or in hard to staff subjects.
  • Our university teacher education programs will be redesigned to meet the needs and standards of our primary and secondary schools. The Chancellor of Higher Education will be empowered to reward university education programs that best prepare their students for success as teachers in Ohio.
  • We will strengthen our licensing standards for school principals while giving them the ability and the responsibility to properly manage their schools.
  • We will create standards for the mastery of both education and management principles for school superintendents, school treasurers and other business officials.
  • And you know, good ideas shouldn’t be something we stumble on accidentally. That’s why my plan creates a research and development function within the Department of Education. The department’s Center for Creativity and Innovation will monitor research and results from across the country and across the world to keep Ohio schools and Ohio educators informed of new advances.

Fourth, under my plan, we will measure ourselves against the world.

  • Ohio’s current graduation test does not measure creativity, problem solving, and other key skills. We will make our assessments both relevant and rigorous by replacing the Ohio Graduation Test with the ACT and three additional measures.
  • All students will take the ACT college entrance examination, not only to measure their high school achievement, but to help raise students’ aspirations for higher education. Students will also take statewide ‘end of course’ exams, complete a service learning project, and submit a senior project.
  • These four measures will give our graduating high school seniors the opportunity to demonstrate knowledge, creativity, and problem solving skills, in short, to demonstrate precisely the skills that will help them succeed in life.
  • In grades 3 through 8, our assessments will also be entirely rewritten to test for mastery of the information and skills in the curriculum.
  • Our goal in our teaching and in our testing is nothing short of national and international leadership.

Fifth, under my plan, we will establish an unprecedented level of school district accountability and transparency.

  • School districts will undergo performance audits overseen by the Department of Education to make sure they are maintaining the academic and operating standards we’ve established.
  • Districts will report their spending plans before each school year and then account for every dollar at the conclusion of the school year.
  • And just as we provide an academic report card for our schools, we will provide parents, public officials, and taxpayers an annual fiscal and operational report card for every school district. That means that when we send districts funding to help students who need additional attention and instruction, we will now be able to track our dollars to see that they directly reach those students.
  • Failure to comply with our standards will result, first, in the assigning of technical assistance to help a school district correct its deficiencies. If the problem persists, a district will be required to present a comprehensive plan outlining how it will reach full compliance with our academic and operating standards. Continued failure would result in the district being placed in receivership, with entirely new leadership installed. And finally, if the district remains non-compliant, the State Board of Education would be required to revoke the school district’s charter. In short, if a school district fails, we will shut it down.
  • And, as we establish a new level of accountability in our school districts, we must also establish accountability in our charter schools. For those who may have misunderstood my position on charter schools, I want to be very clear. I support charter schools that meet the same high standards we demand of traditional public schools. Charter schools that hire quality teachers, show fiscal and academic accountability, are regulated by the Department of Education, and are not run by for-profit management services have a place in my plan.
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Consumer Advocacy Group Files Complaint With PUCO Concerning DP&L’s New Programs And Rates

The Dayton Business Journal reports that The Office of the Ohio Consumers’ Counsel (OCC), a consumer advocacy group, is officially protesting new plans put forward by Dayton Power and Light. OCC filed a complaint with the Public Utilities Commission of Ohio (PUCO) and also requested that the commission hold public hearings to provide local customers a chance to voice concerns about the power company’s proposed new programs and rates.

Janine Migden-Ostrander of the Consumers’ Counsel, in a news release said, “The OCC supports the concepts in many of DP’s proposals, such as building a more advanced electric system and offering energy efficiency programs, however DP&L’s proposed costs are higher than what customers should reasonably be expected to pay.”

The OCC requests:

  • Eliminating additional fuel cost charges to customers in place of deferring the costs, as proposed by DP&L;
  • Reducing the cost residential consumers pay for the discounts provided to large energy users. The counsel said DP&L had proposed customers make up for the discounts provided to some large customers;
  • Minimizing the administrative and marketing costs of energy efficiency programs. The counsel’s experts found that marketing and administrative costs made up 44 percent of total residential energy efficiency program costs, leaving less more for incentives. The counsel proposed the marketing and administrative costs be reduced to no more than 25 percent;
  • Offering all customers weatherization opportunities. The counsel recommended that all customers, regardless of income, be eligible for incentives through a home performance program;
  • Lowering expenses for advanced metering and Smart Grid initiative;
  • Adding new customer rate options, including a requirement that would offer programs to help customers save on their electric bills by shifting their usage to times when the price of electricity is cheaper; and
  • Introducing new incentives for consumers to generate renewable power, including a program to provide an incentive to customers who invest in a renewable energy project.


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