Agencies release budget cut plans

Jan. 31, 2008 - The following plans were submitted to Gov. Ted Strickland per his request for agency directors to identify spending reductions and realize savings. FULL STORY

FY 2008 – 2009
Budget Recalibration Memo for State Agencies
Released Jan. 31, 2008
Download and Print PDF Version

• ODADAS will reduce administrative costs in central office by approximately $2.5 million in FY08 by placing controls on traveling, equipment purchases, and other administrative functions.

• Because of the downturn in the economy and projected state revenues, the agency is taking cost reduction measures and is expected to reorganize, restructure or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels.
  
  For ADA, the potential impact of these actions may be a reduction of 6-12 positions through attrition, vacancies that will remain unfilled, early retirement incentive plans, abolishments, and other reductions.

[ top ]

• Lapse $1,000,000 for the biennium from the National Guard Benefits program (GRF 745-407) over the biennium.

• Lapse $180,556 in FY08 payroll costs from Central Administration (GRF 745-409).

• Lapse $119,443 in FY08 payroll from Army National Guard (GRF 745-499).

[ top ]

• AGE will continue core activities without service disruption. Due to lower than estimated enrollment, appropriations in PASSPORT and Assisted Living are reduced. For PASSPORT it is anticipated that the available funding will cover new full enrollment estimates. For Assisted Living it will cover all current enrollees plus those currently in Nursing Facilities on the waiting list for assisted living.

• Administration will seek legislative approval to eliminate the 3% Medicaid reimbursement rate increase in fiscal year 2009 for PASSPORT and Choices providers.

• In part due to the growth of the Medicare Prescription Drug Program (Medicare Part D) and the expansion of generic drug discount programs offered by retail chains, the need for services provided by the Ohio Best Rx program has not been as high as estimated. AGE will sustain the current program (Ohio's Best Rx) through the biennium using non-GRF resources.

[ top ]

• To allow ODA to continue to fulfill its essential food safety operations with a minimal impact from budget reduction, the largest GRF-supported program at ODA, meat inspection, is exempt from reductions.

• Because of the downturn in the economy and projected state revenues, the agency is taking cost reduction measures and is expected to reorganize, restructure or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels. For ODA, the potential impact of these actions may be a reduction of 17 to 31 positions through attrition, vacancies that will remain unfilled, early retirement incentive plans, abolishments, and other reductions.

• ODA is pursuing several cost saving strategies of note. Attempts are being made to reduce ODA’s vehicle fleet, there is an out-of-state travel freeze in effect for all non-essential trips, and thermostats have been turned down by four degrees in all buildings at the ODA campus.
  
  Also, equipment purchases have been reduced and ODA has reached out to other state agencies to see what operational consolidation, or other joint cost saving measures, could be done.

[ top ]

Budget Reduction Target:
FY2008: $90,400,000
FY2009: $0

• The Board of Regents will save an estimated $150,000 in FY08 and $400,000 in FY09 by eliminating or not filling several positions. Additional savings of up to $250,000 each fiscal year will be realized through administrative action to minimize travel, equipment, subscription and personal service contracts.

• Cash management strategies and a revised disbursement schedule for three new programs (Choose Ohio First Scholarship, Ohio Research Scholars, and the James A. Rhodes Scholarship) will generate $90 million in savings in FY08. The administration will seek legislative approval to accomplish strategic realignment of appropriations in needs based financial aid, which will result in increases in appropriations in FY09.

• Because of the downturn in the economy and projected state revenues, the agency is taking cost reduction measures and is expected to reorganize, restructure or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels. For the Board of Regents, the potential impact of these actions may be a reduction of three to nine positions through attrition, vacancies that will remain unfilled, early retirement incentive plans, abolishments, and other reductions.

[ top ]

• The labor and worker safety (LAWS) program, the only program at Commerce which receives general revenue funding, is exempt from GRF budget reductions.
  

Budget Reduction Target:
FY2008: $2,322,040
FY2009: $2,678,040

• Because of the downturn in the economy and projected state revenues, DAS is taking cost reduction measures and is expected to reorganize, restructure, or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels.

• Targeted budget reductions include excess FY08 appropriation for the school employees health care board, the FY09 OAKS project implementation appropriation, and supplemental funding for the state printing and mail fulfillment consolidation into DAS. There is also anarray of targeted budget reductions in the County & University Human Resources Services program.

[ top ]

• Because of the downturn in the economy and projected state revenues, the agency is taking cost reduction measures and is expected to reorganize, restructure or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels. For the Department of Development, the potential impact of these actions may be a reduction of 11 to 20 positions through attrition, vacancies that will remain unfilled, early retirement incentive plans, abolishments, and other reductions.

• DOD will realize cost savings by, reducing personal service contracts related to the Thomas Edison Program and Travel & Tourism activities (these two GRF reductions total $2,324,000), reducing subsidy payments to the Labor Management Program ($76,000), and canceling old subsidy encumbrances ($366,000). Will seek legislative approval to transfer excess funds from the operating budget of the International Trade Division ($64,000).

• Nine million dollars will be obtained through increased lapses and without service interruption

[ top ]

• DMH intends to begin the process for the closures of Dayton and Cambridge psychiatric hospitals and the consolidation of other hospital administrative functions.
  
  In order to maintain capacity for MH patients, units will be opened in the Columbus, Athens, Toledo, and Cincinnati locations.

• DMH will implement various cost control strategies in order to reduce administrative costs. DMH plans to reduce Central Office staff by approximately 20%. Additionally, a control on proposed and unfilled positions will begin immediately. The Central Office will also cut equipment and contract spending by 20%.

• Because of the downturn in the economy and projected state revenues, the agency is taking cost reduction measures and is expected to reorganize, restructure or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels. For DMH, the potential impact of these actions may be a reduction of positions through attrition, vacancies that will remain unfilled, early retirement incentive plans, abolishments, and other reductions.

[ top ]

• Because of the downturn in the economy and projected state revenues, the agency is taking cost reduction measures and is expected to reorganize, restructure or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels. For DMR, the potential impact of these actions may be a reduction of 390-540 positions through attrition, vacancies that will remain unfilled, early retirement incentive plans, abolishments, and other reductions.

• In addition to GRF reductions, DMR will meet its target through the cancellation GRF subsidy encumbrances and other non-GRF cash management strategies.

• DMR will realize cost savings by centralizing services and collaborating with other state agencies.

• DMR’s plan aims to minimize cuts to direct service provision and preserve Federal Medicaid match. To realize this strategy, DMR will move approximately 150-170 people from Developmental Centers to Martin Waivers, allowing for the closure of some cottages in some Development Centers.

[ top ]

• DNR will realize cost savings through restructuring measures such as transferring the Scenic Rivers program to the Division of Watercraft resulting in over $500,000 in GRF savings.

• DNR will realize cost savings through centralizing the fiscal operations of smaller Division offices.

• Because of the downturn in the economy and projected state revenues, the agency is taking cost reduction measures and is expected to reorganize, restructure or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels.
  
  For the Department of Natural Resources, the potential impact of these actions may be a reduction of 85 to 157 positions through attrition, vacancies that will remain unfilled, early retirement incentive plans, abolishments, and other reductions.

[ top ]

• Increased lapses and federal funds carried forward from prior years will enable the department to continue to provide the same level of service.

• Due to reduced funding levels, efforts to modernize Ohio’s vital statistics records will not progress as quickly as planned.

• Because of the downturn in the economy and projected state revenues, the agency is taking cost reduction measures and is expected to reorganize, restructure or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels. For the Department of Health, the potential impact of these actions may be a reduction of 16 - 34 positions through attrition, vacancies that will remain unfilled, early retirement incentive plans, abolishments, and other reductions.

[ top ]

• In order to preserve the administrations’ commitment to a multimodal transportation system, ODOT provided allowable federal funds to assure that general aviation, rail, and public transit grants and local projects are held harmless.

• Because of the downturn in the economy and projected state revenues, the agency is taking cost reduction measures and is expected to reorganize, restructure or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels. For the Department of Transportation, the potential impact of these actions may be a reduction of positions through attrition, vacancies that will remain unfilled, and other reductions.

• Reduce Airport Improvement line item by $1,500,000. Despite this reduction, ODOT feels it will still be able to provide sufficient financial assistance to local general airports for system preservation and safety improvements.

• Other cost cutting activities include the cancelation of old encumbrances, lapsing prior quarter allotments, and reducing personal service contracts, travel costs, operational support fees, and hiring activities.

[ top ]

• DPS will reduce equipment purchases, personal service contracts, and travel.

• Because of the downturn in the economy and projected state revenues, the agency is taking cost reduction measures and is expected to reorganize, restructure or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels.
  
  For DPS, the potential impact of these actions may be a reduction of 4-11 positions through attrition, vacancies that will remain unfilled, early retirement incentive plans, abolishments, and other reductions.

[ top ]

• DRC’s plan will not reduce the number of corrections officers, parole officers, or nurses.

• Within DRC prison operations, unit management will be changed to centralize the delivery of inmate services and programs at selected institutions. This change will save more than $7 million dollars over the biennium.

• DRC will implement a number of changes to the prison commissaries which will include bulk purchasing through a statewide contract and price increases which will save over $6,425,000 during the biennium.

• DRC will improve efficiency by consolidating operations at selected adjacent prisons, resulting in savings of $6,441,202 over the biennium.

• Because of the downturn in the economy and projected state revenues, the agency is taking cost reduction measures and is expected to reorganize, restructure or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels. For DRC, the potential impact of these actions may be a reduction of 434-815 positions through attrition, vacancies that will remain unfilled, early retirement incentive plans, abolishments, and other reductions.'

[ top ]

Budget Reduction Target:
FY08: $0
FY09: $1,695,008

• The State of Ohio is currently engaged in good faith settlement negotiations of a system wide challenge to the constitutionality of conditions in its juvenile corrections facilities (S.H. v. Stickrath).
  
  Because the Governor has determined that substantial reforms are necessary to improve Ohio’s juvenile corrections system, he has directed that cuts at the Department of Youth Services be limited to reductions in central office operations and administration staff.
  
  By preserving all other system resources at this time, the Governor has maintained the maximum potential flexibility for the implementation of needed reforms.

• Because of the downturn in the economy and projected state revenues, the agency is taking cost reduction measures and is expected to reorganize, restructure or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels. For the Department of Youth Services, the potential impact of these actions may be a reduction of Central Office workforce through attrition, vacancies that will remain unfilled, early retirement incentive plans, and other staff reductions due to operational efficiencies totaling $1,343,363 in FY09.

• Central Office reduction in operations (training, travel, supplies & equipment) totaling $351,645 in FY09.

[ top ]

• The Administration has requested that the Department of Education implement a budget reduction strategy that exempts services critical to direct pupil education.

• The Department of Education expects to achieve these targets through lapses, cancellation of prior-year encumbrances, and reductions in targeted line items.

• In order to maintain the commitment to primary and secondary education in HB 119, numerous line items, including foundation funding, auxiliary services and STEM, will be exempted from the reductions.

• Because of the downturn in the economy and projected state revenues, the agency may be taking cost reduction measures, and may be expected to reorganize, restructure or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels. The potential impact of these actions may be a reduction of positions through attrition, vacancies that will remain unfilled, early retirement incentive plans, abolishments and other reductions.

[ top ]

• Leading by example, the Governor’s office is reducing GRF appropriation by $629,490 or 25.2% in fiscal year 2008 and by $779,130 or 16.1% in fiscal year 2009 in Operating Expenses and Federal Relations.

• The Governor’s office will meet its target through $190,638 of non-GRF cash management strategies, such as controls on travel and other expenses.

[ top ]

• Because of the downturn in the economy and projected state revenues, the agency is taking cost reduction measures and is expected to reorganize, restructure or consolidate operations in order to realize cost savings and operate successfully within reduced appropriation levels.
  
  For the Department of Job and Family Services, the potential impact of these actions may be a reduction of 309 to 574 positions through attrition, vacancies that will remain unfilled, early retirement incentive plans, abolishments, and other reductions.

• JFS also plans to reduce rent costs by moving and consolidating staff in satellite offices.

• JFS will use various cash management controls, including increased use of non-GRF funds to help offset GRF reductions.

• JFS will continue to implement the Medicaid expansions, restore dental services for adults and provide rate increases for community health providers as set forth in Am. Sub. H.B. 119, providing access to medical care for Ohio’s most vulnerable citizens.

• Additionally, the following changes will be made to the Medicaid budget:
  • delay the increase for inpatient rates for hospitals.
  • defer recalibration for hospital rates.

[ top ]

• The Ohio Lottery Commission will achieve its budget target by enhancing lottery revenues through refreshing game products and adding games, such as Keno and other monitor games limited to age and time controlled settings, such as bars and other similar venues.

[ top ]