Focus on Privatization Seen in Ohio Budget Proposal

By: - March 15, 2011 12:00 am

GOING PRIVATE: Ohio Governor John Kasich’s budget proposal is expected to include privatization of a number of government assets and functions when it is revealed today, The Plain Dealer reports . Kasich’s plan calls for the sale of five state prisons, which is expected to generate million in revenue, and the long-term lease of the Ohio Turnpike, from which Kasich hopes to generate billion. Two of the prisons in question already are run by private companies, two are publicly owned, and one is vacant. The buyers would be paid by the state to operate them, with a requirement that the arrangement result in at least a 5 percent cost savings to the public. Legislation to allow the state to privatize economic development efforts has already been signed into law, and the governor also is reportedly working on a proposal to privatize lottery operations, as Illinois has done.

BARGAINING OVER BENEFITS: Despite an icy relationship with unions in his state, New Jersey Governor Chris Christie has made national headlines lately by opining about his “love” of collective bargaining. Still, he wants to skip the bargaining table in favor of legislative action to force state employees to cover 30 percent of their health care costs, The Star-Ledger reports . Christie argues that unions have employed the same tactic when seeking benefit increases in the past. The unions counter that the only increases granted legislatively have been pension-related, and under New Jersey law fall outside the bargaining process. Contract negotiations began last week between state employee unions and the Christie administration, and this is the first point of tension to be made public.

COST-CUTTING ALTERNATIVES: A week after Wisconsin’s enactment of a bill rescinding collective bargaining rights, public sector unions around the country are debating how to respond. In Oregon , one local union is taking a proactive approach by suggesting ways for state government to reduce spending, without undermining public employee rights. Service Employees Local 503 released a study suggesting that Oregon has too many middle managers, and recommends that cost savings be sought in the .4 billion the state spends on contracts, reports the Statesman Journal . A comprehensive set of budget-cutting recommendations from union members is expected at the end of the month. “I don’t think any of them are game changers,” state Representative Peter Buckley, the Democratic chair of the Ways and Means Committee, said of SEIU’s suggestions. “It’s going to take everyone from all sides stretching to close this gap.”

RETIREE HEALTH: As in most states, many public employees in Maine who are eligible for retirement have been working longer than was once expected. But the long-anticipated retirement wave may finally arrive, reports the Associated Press , if a key element of Governor Paul LePage’s budget proposal makes it into law. LePage’s plan would force state workers and teachers who retire after January 1 of next year to pay for health care coverage until they turn 65. The change is expected to persuade 1,000 teachers and 600 to 700 other state employees to retire before next January 1, and to save the state .4 million in the next two years, according to administration projections. 

CLOSING RECORDS: Utah Governor Gary Herbert has signed a controversial bill weakening the state’s open records law, but debate on the subject is not over. The law will impose new fees for records access and exempt all text messages, instant messages and video chats from public access, reports The Salt Lake Tribune. Discussion continues, however, because the governor made a deal with the legislature to delay implementation of the bill until July 1 in order to allow time for a task force to study the open records law and recommend other changes that could be made during a special session in June.

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Melissa Maynard

Melissa Maynard oversees the Pew state fiscal health project’s Fiscal 50 online resource, which helps policymakers understand fiscal, economic, and demographic trends affecting their states by tracking tax revenue, reserves, employment rates, Medicaid spending, and other issues important to long-term fiscal health.