CHICAGO -- Negotiations on eliminating a projected $520 million deficit in Ohio's fiscal year 1993 budget ended without agreement between the governor and legislators last week, paving the way for an executive order on Wednesday to cut $370 million from the budget.
Jenny Camper, a spokeswoman for Gov. George V. Voinovich, said the door was still open to further negotiations with the legislature even though the administration is preparing to proceed with the cuts.
Under the executive order, the governor would cut $370 million from the state's $14 billion general fund budget for the fiscal year that begins Wednesday, resulting in funding decreases as high as 20% in some state departments, Ms. Camper said.
The administration is betting that the remaining $150 million of the deficit will be eliminated by the economic recovery, she added.
The governor and legislative leaders had been negotiating for weeks to reduce the deficit without making massive cuts in state department budgets, particularly in higher education. Ms. Camper said, however, that higher education cuts under the governor's executive order would total $224 million.
The Democrat-controlled House rejected Gov. Voinovich's plan to raise $123 million in tobacco and alcohol tax increases to reduce the higher education cuts. But the plan did have support among Republicans who control the Senate.
Kent Carson, a spokesman for House Speaker Vern Riffe, D-Portsmouth, said the governor rejected the speaker's substitute plan to close tax loopholes and equalize income tax collections, leaving negotiations at a dead end.
But Scott Borgemenke, a special assistant to Senate President Stanley Aronoff, R-Cincinnati, said while no alternative plan was on the table as of Friday, "the lines of communication are still open."
Meanwhile, Speaker Riffe is questioning why the governor should make the executive order cuts on the first day of the fiscal year.
"The speaker is saying, "Why go in now, because [the deficit] could get worse or better,"' Mr. Carson said.
Ms. Camper contended that making the cuts at the beginning of the fiscal year is the most fiscally responsible thing for the governor to do, particularly if the remaining $150 million projected deficit grows larger later in the fiscal year.
In fact, the nonpartisan Legislative Budget Office has projected a $743 million deficit for fiscal 1993. Dennis Morgan, director of the office, said the higher deficit number reflects a more cautious estimate on revenues in fiscal 1993 and anticipated higher spending on human services than was included in the state Office of Budget and Management's $520 million deficit projection.