On July 20, the Ohio Office of Budget and Management (OBM) released guidance for state agencies, boards and commissions to develop their budgets for fiscal years (FY) 2022 and 2023. Developing the state budget isn’t just about funding, it also outlines policy priorities, something that is going to be particularly crucial to watch this cycle as each agency is being asked to submit versions of their budgets with spending cut by 10 percent.
Each agency is being asked to submit versions of their budgets with spending cut by 10 percent.
Like clockwork, the OBM guidance is released in the summer of every even numbered year, informing agencies of the work ahead to outline a balanced budget for the state. In her introductory letter, OBM Director Kimberly Murnieks thanked staff for the work that they did to balance the FY 2020 budget in the midst of both public health and economic crises, while reinforcing that the current budget, spanning July 1, 2020 through June 30, 2021, and the coming years’ budgets will be just as challenging.
Budget guidance in years past has always provided general economic context, as well as a focus on supporting the Governor’s priorities. This is not entirely different, but there are some changes in the request. Agencies are asked to submit two different budget scenarios, a “reduction request” and a “continuing priorities request.” The reduction request asks agencies to submit a budget that reduces general revenue fund spending by 10 percent compared to the current year. The continuing priorities request asks agencies to submit a budget that maintains services at the current level and encourages agencies “to rethink operations, organizational structure, and outcomes to become more efficient and effective.” The guidance points out that these budget limits will be implemented at the fund level, rather than at an overall agency level and agencies are encouraged to shift funds across programs and line items to reflect the administration’s overall priorities.
The guidance also includes a project timeline for the 2022-2023 budget development process
The guidance also includes a project timeline for the 2022-2023 budget development process. Key dates in this process are included in the table below.
*Dates are subject to change
The development of the state budget is not just about funding. It also clearly lays out the policy priorities of the administration, and subsequently the legislature, as the operating budget moves through the committee process to its eventual passage next summer. In light of the public health and economic crises that Ohio, along with the nation, will certainly continue to deal with, the 2022-2023 state budget will be both impactful and challenging as the process develops.
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