1. The 2012-2013 Budget Bluebook: Content and Questions ( And a Few Other Issues) Ohio University Leadership Project Presentation by BASA March 23, 2011

2. GRF Revenues – Actual $ Received Comparing 02/11 with YTD Estimates $ in thousands CategoryActual FY11 per 02/28/2011Estimated FY11 per 02/28/2011Difference Non-Auto Sales $ 4,451,412 $ 4,323,100 $ 128,312 Auto Sales & Use $ 608,904 $ 558,800 $ 50,103 Subtotal - Sales $ 5,060,316 $ 4,881,900 $ 178,415 Personal Income$ 4,831,916 $ 4,600,300 $ 231,616 Corporate Franchise $ 70,390 $ 27,400 $ 42,990 Public Utility $ 81,616 $ 115,900 $ (34,283) KWH Tax $ 108,284 $ 115,801 $ (7,517) Foreign/Domestic Insurance $ 192,740 $ 169,984 $ 22,756 Other Business $ (993) $ 126 $ (1,119) Soft Drink/Sin Tax $ 578,951 $ 540,800 $ 38,151 Estate $ 27,436 $ 28,400$ (964) Total Tax Receipts $ 10,950,656 $ 10,480,611 $ 470,045

3. GRF Revenues – Actual $ Received Comparing YTD 02/11 with 02/10 $ in thousands CategoryActual FY11 per 02/28/11Actual FY10 per 02/28/10Difference Non-Auto Sales $ 4,451,412 $ 4,186,745 $ 264,667 Auto Sales & Use $ 608,904 $ 550,406 $ 58,498 Subtotal - Sales $ 5,060,316 $ 4,737,151 $ 323,165 Personal Income $ 4,831,916 $ 4,454,696 $ 377,220 Corporate Franchise $ 70,390 $ 2,885 $ 67,505 Public Utility $ 81,616 $ 88,069 $ (6,453) KWH Tax $ 108,284 $ 107,547 $ 737 Foreign/Domestic Insurance $ 192,740 $ 171,260 $ 21,479 Other Business $ (993) $ 283 $ (1,276) Soft Drink/Sin Tax $ 578,951 $ 596,294 $ (17,341) Estate $ 27,436 $ 25,909 $ 1,527 Total Tax Receipts $ 10,950,656 $ 10,184,093 $ 766,563

4. Overview- HB 153 Final phase of 21% income tax cut Cutting costs and shifting dollars from local governments to General Revenue Fund – Reduces income tax revenue to LGF at 75% of FY 2011 level in FY2012 and to 50% in FY2013 – Portion of CAT tax to GRF will gradually increase from 25% in FY2012 to 100% IN FY2021 2% cap in amount of revenue districts could experience as result of TPP reimbursement reduction

5. Overview – HB 153 (continued) Public library fund reduced by 5% Kilowatt hour tax to school district property tax replacement fund goes from 25.4% this year to 9% in FY2012 and to 8% in FY2013 Ohio’s liquor distribution system to be leased to JobsOhio for economic development Sale of 5 prisons and one JDF to private entities

6. HB 153 – Academic Achievement $0 funding for alternative education programs $0 funding for School Improvement Initiatives but about $3.7 MM directed to ESC’s for this purpose $0 funding for Violence Prevention and School Safety Drug Free Schools reduced from almost $13.4 MM to $1.5 MM in FY2012 and $0 in FY2013

7. HB 153 – Basic Aid Support Auxiliary Services and Nonpublic Administrative Support increased 1.4% & 1.5% Significant cuts to TPP replacement and to TPP utility replacement 2% cap on TPP & TPP-utility reductions – Total resources = state funding + property taxes + income tax + TPP and utility reimbursements – Reduction cannot exceed 2% of total resources

8. HB 153 – Career-Technical/ECE Career-Technical Match continued Tech Prep Consortia funding cut about 80% $1MM from consortia redirected to HSTW and to Tech Prep grants Ohio Career Information System funding increased by about 35% Flat funding for ECE and Preschool units $0 funding for Early Learning Initiative

9. HB 153 – Gifted Education Funding cut by 88.2% Balance of gifted funding moved to basic aid support Spending requirements for gifted are eliminated Funding provided only for gifted units provided by educational service centers

10. HB 153 – School Operation Support $0 funding for School Employee Health Care Board Ohio Educational Computer Network cut by 10% and EMIS cut by almost 43% – EMIS funding “redirected” through basic aid School District Solvency Assistance increased by almost 39%

11. House Bill 30 Addresses unfunded/underfunded mandates As presently written (with most recent amendments added) – No authority for SSPI to adopt rules imposing spending and reporting requirements – Eliminates all-day kindergarten requirement – Reinstates authority to charge tuition and fees for all-day kindergarten

12. House Bill 30 (continued) Retains five-year forecast Eliminates requirement for family and civic engagement teams Delays for two years the adoption of rules by SBE to enforce gifted spending requirements School Funding Advisory Council restored Removes “preference” for hiring licensed school nurse as wellness coordinator or district health professional

13. House Bill 36 Emergency clause to apply law to 2010-2011 Restores excused calamity days to 5 days Eliminates requirement that school districts make up first five excess days (contingency plan) as whole school days; could add increments of 30 minutes Passed by House on March 9, 2011

14. House Bill 36 (continued) Sponsor testimony on March 16 Issues – Time to revisit 126 th House Bill 254 – “Docking” for a day’s pay – Classified contract days? Please see attached chart

15. HB 136 – Educational Choice Parental Choice and Taxpayer Savings Scholarship (PACT) Scholarship for nonpublic school enrollment Would apply to any school without regard to academic rating No limit on number of scholarships Also creates Special Education Scholarship Program which use weighted funding Range of Ed Choice - $2,300 to $4,600 Special Ed range - $7,100 to $27,500 The PACT Scholarship

16. SB 65 – Educational Choice Eliminates “cap” on number of scholarships – Current cap is 14,000; exceeded for first this year Would maintain eligibility requirement of attendance at academic watch and emergency school Removes reference to “pilot” program Current scholarship amount retained – $4,250 for K-8 and $5,000 for 9-12

17. HB 115 – Educational Choice Gradually increase available scholarships from 14,000 to 20,000 over a six-year period Issues with Educational Choice – Scholarship good until graduation – Issue of assigned public school improving – Deduction from district exceeds per pupil state funding for district – Deduction ($5,200) exceeds amount of scholarship

18. SB 5 – Collective Bargaining (cont.) (as introduced) Abolishes statutorily provided leave for employees and require boards to adopt leave policies Abolishes continuing contracts for teachers (except those in existence on effective date) Prohibits districts from paying employee contributions to retirement systems Removes seniority from RIF decisions

19. SB 5 – Amendments (based on Ohio Senate summary) Reinstates collective bargaining rights for all state employees Removes right to strike for all public employees and establishes penalties – Violators subject to removal from position – Violators have pay deducted at 2 times daily rate – Violation of court injunction could mean contempt of court – No waiver of penalties or fines as settlement – Possible suspension of dues payments for length of strike

20. SB 5 – Amendments (based on Ohio Senate summary) Dispute settlement procedures – Either party may request SERB mediator – Either party may request fact-finder who must consider factors in statute – Either party may request fact-finding hearings open to public – Fact-finder must consider interests and welfare of public and ability of employer to administer and finance

21. SB 5 – Amendments (based on Ohio Senate summary) Dispute settlement procedures (continued) – Within 14 days of fact-finding report or if CBA has expired, board will decide (after a hearing) between last best offer of employee or employee organization with agreement effective for 3 years – Only employer’s current financial condition can be considered; no potential future increases Clarifies employer rights – Includes hiring, discharging/discipline of employees; work assignments/hours; qualifications; employee rules and regulations

22. SB 5 – Amendments (based on Ohio Senate summary) Establishes that all matters pertaining to wages, hours, and terms/conditions of employment subject to bargaining except: – Health care benefits – Pension pick-ups – Privatization of services – Workforce levels

23. SB 5 – Amendments (based on Ohio Senate summary) Timelines and certification – Adjusts for reasonable deadlines – SERB must investigate certification rather than automatically certifying Establishes public employee pay ranges – Eliminates state minimum salary schedule (including step increases) – Establishes minimum pay ranges using current state minimum schedule

24. SB 5 – Amendments (based on Ohio Senate summary) Teachers to be paid based on merit with salaries to be bargained in CBA – Level of license held by teacher – “Highly qualified”? – Value-added measure of student performance – Results of performance evaluations – Any other system of evaluation or other criteria established by the board

25. SB 5 – Amendments (based on Ohio Senate summary) Health care benefits applied equally – 85%/15% split – Restores current law for SEHCB Allows teachers to negotiate initial contract of up to 3 years; subsequent ones are 2-5 years Length of service not sole factor in determining order of layoff – Preference to continuing contracts and then to relative quality of performance

26. SB 5 – Amendments (based on Ohio Senate summary) Contracts – Initial contract up to 3 years – Subsequent limited contracts 2 to 5 years – Continuing contracts available only to those licensed before January 1, 2011 Ohio’s constitutional “contract impairment” clause The referendum issue