A monthly newsletter of the Legislative Budget Office of LSC  
Volume: Fiscal Year 2020  
Issue: January 2020  
Highlights  
Ross Miller, Chief Economist  
GRF tax receipts during the first half of FY 2020 were $93.2 million over the  
estimate published by the Office of Budget and Management (OBM) in  
August 2019. GRF nontax revenue was also above expectations for the first half of  
the year, by $34.6 million. GRF expenditures were below estimate, meaning the  
state budget is following a very favorable trajectory so far this year.  
Ohio’s unemployment rate was 4.2% in November, the same rate as October.  
While Ohio’s rate was higher than the national rate of 3.5% that month, both  
rates are at low levels by historical standards. Ohio’s nonfarm payroll employment  
increased by 6,700 from October to November.  
Through December 2019, GRF sources totaled $17.27 billion:  
Revenue from the sales and use tax was $79.5 million above estimate;  
Personal income tax receipts were $2.8 million below estimate.  
Through December 2019, GRF uses totaled $18.48 billion:  
Program expenditures were $257.3 million below estimate;  
Expenditures from all program categories were below estimates, led by  
Higher Education ($67.8 million), Medicaid ($53.7 million), Health and  
Human Services ($39.0 million), and General Government ($31.9 million);  
Spending was below expectations in other program categories by lesser  
amounts.  
In this issue...  
More details on GRF Revenues (p. 2), Expenditures (p. 12),  
the National Economy (p. 30), and the Ohio Economy (p. 32).  
Also Issue Updates on:  
State Debt and Bond Issuance (p. 20)  
New Highway Construction Projects (p. 21)  
Medicaid Infant Mortality Grants (p. 22)  
Drug-Free Communities Support Grants (p. 24)  
Growth in EdChoice Scholarships (p. 24)  
Choose Ohio First Scholarships (p. 26)  
Ohio – Ready, Test, Drive! Program (p. 27)  
H2Ohio Wetland Restoration Projects (p. 27)  
Latino Mental Health Navigator Project (p. 28)  
Available online at: www.lsc.ohio.gov/Budget Central  
Legislative Budget Office of the Legislative Service Commission  
Table 1: General Revenue Fund Sources  
Actual vs. Estimate  
Month of December 2019  
(
$ in thousands)  
(
Actual based on report run in OAKS Actuals Ledger on January 8, 2020)  
State Sources  
Tax Revenue  
Actual  
Estimate*  
Variance Percent  
Auto Sales  
Nonauto Sales and Use  
Total Sales and Use  
$119,378  
$838,992  
$958,370  
$119,800  
$873,300 -$34,308  
$993,100 -$34,730  
-$422  
-0.4%  
-3.9%  
-3.5%  
Personal Income  
Commercial Activity Tax  
Cigarette  
Kilowatt-Hour Excise  
Foreign Insurance  
Domestic Insurance  
Financial Institution  
Public Utility  
Natural Gas Consumption  
Alcoholic Beverage  
Liquor Gallonage  
Petroleum Activity Tax  
Corporate Franchise  
Estate  
$829,347  
$9,007  
$73,248  
$20,587  
-$2,290  
$3,819  
-$9,042  
$5,218  
$3  
$4,926  
$4,474  
$2,245  
$9  
$793,700  
$10,200  
$72,000  
$21,900  
$0  
$35,647  
-$1,193 -11.7%  
$1,248  
-$1,313  
-$2,290  
$3,819  
-$4,842 -115.3%  
$1,718  
$3  
$126  
$274  
-$255 -10.2%  
4.5%  
1.7%  
-6.0%  
---  
$0  
---  
-$4,200  
$3,500  
$0  
$4,800  
$4,200  
$2,500  
$0  
49.1%  
---  
2.6%  
6.5%  
$9  
$0  
---  
---  
$0  
$0  
Total Tax Revenue  
$1,899,921 $1,901,700  
-$1,779  
-0.1%  
Nontax Revenue  
Earnings on Investments  
Licenses and Fees  
Other Revenue  
$23  
$687  
$3,785  
$4,495  
$0  
$424  
$1,130  
$1,554  
$23  
$263  
$2,655 234.9%  
$2,941 189.2%  
---  
62.0%  
Total Nontax Revenue  
Transfers In  
$0  
$0  
$0  
---  
0.1%  
Total State Sources  
$1,904,417 $1,903,254  
$1,162  
Federal Grants  
$1,298,733 $1,015,036 $283,696  
$3,203,149 $2,918,291 $284,858  
27.9%  
9.8%  
Total GRF Sources  
*
Estimates of the Office of Budget and Management as of August 2019.  
Detail may not sum to total due to rounding.  
Budget Footnotes  
P a g e | 2  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
Table 2: General Revenue Fund Sources  
Actual vs. Estimate  
FY 2020 as of December 31, 2019  
(
$ in thousands)  
(
Actual based on report run in OAKS Actuals Ledger on January 8, 2020)  
State Sources  
Tax Revenue  
Auto Sales  
Nonauto Sales and Use  
Total Sales and Use  
Actual  
Estimate*  
Variance Percent FY 2019**  
5.1% $743,565  
0.9% $4,594,584  
1.4% $5,338,148  
Percent  
$800,865  
$4,790,415 $4,749,900 $40,515  
$5,591,280 $5,511,800 $79,480  
$761,900 $38,965  
7.7%  
4.3%  
4.7%  
Personal Income  
Commercial Activity Tax  
Cigarette  
Kilowatt-Hour Excise  
Foreign Insurance  
Domestic Insurance  
Financial Institution  
Public Utility  
Natural Gas Consumption  
Alcoholic Beverage  
Liquor Gallonage  
Petroleum Activity Tax  
Corporate Franchise  
Estate  
$4,431,242 $4,434,000  
-$2,758  
-0.1% $4,373,242  
1.3%  
5.1%  
-4.2%  
-7.7%  
8.1%  
$808,022  
$402,501  
$165,435  
$171,964  
$3,826  
$785,300 $22,722  
$404,500  
$169,200  
$156,000 $15,964  
$0 $3,826  
2.9%  
-0.5%  
-2.2%  
10.2%  
---  
$768,754  
$420,313  
$179,207  
$159,037  
$2  
-$1,999  
-$3,765  
---  
-$38,958  
$64,445  
$18,293  
$27,413  
$26,053  
$4,041  
-$26,500 -$12,458 -47.0%  
-$28,380  
$73,072  
$20,253  
$27,055  
$25,171  
$4,750  
-37.3%  
-11.8%  
-9.7%  
1.3%  
$68,400  
$19,800  
$30,000  
$25,400  
$4,500  
$0  
-$3,955  
-$1,507  
-$2,587  
$653  
-$459 -10.2%  
$52  
$38  
-5.8%  
-7.6%  
-8.6%  
2.6%  
3.5%  
-14.9%  
-95.6%  
16.9%  
2.8%  
$52  
---  
---  
$1,179  
$32  
$38  
$0  
Total Tax Revenue  
$11,675,646 $11,582,400 $93,246  
0.8% $11,361,836  
Nontax Revenue  
Earnings on Investments  
Licenses and Fees  
Other Revenue  
$41,498  
$11,304  
$77,395  
$130,197  
$27,500 $13,998  
$8,253 $3,051  
$59,871 $17,524  
50.9%  
37.0%  
29.3%  
36.2%  
$25,426  
$10,343  
$54,972  
$90,740  
63.2%  
9.3%  
40.8%  
43.5%  
Total Nontax Revenue  
$95,624 $34,574  
Transfers In  
$75,548  
$68,570  
$6,978  
10.2%  
$76,109  
-0.7%  
3.1%  
7.3%  
4.3%  
Total State Sources  
$11,881,391 $11,746,593 $134,798  
$5,388,345 $5,378,021 $10,324  
$17,269,737 $17,124,614 $145,123  
1.1% $11,528,685  
0.2% $5,021,310  
0.8% $16,549,995  
Federal Grants  
Total GRF SOURCES  
*
*
Estimates of the Office of Budget and Management as of August 2019.  
*Cumulative totals through the same month in FY 2019.  
Detail may not sum to total due to rounding.  
Budget Footnotes  
P a g e | 3  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
1
Revenues  
Jean J. Botomogno, Principal Economist  
Overview  
GRF sources closed out the first half of FY 2020 with a cumulative positive variance of  
145.1 million (0.8%) when compared to the Office of Budget and Management (OBM)  
$
estimate released in August 2019. This year-to-date (YTD) performance was largely due to  
positive variances of $93.2 million (0.8%) for tax revenue and $34.6 million (36.2%) for nontax  
revenues. In addition, federal grants2 and GRF transfers in were above projections by  
$
10.3 million (0.2%) and $7.0 million (10.2%), respectively. Tables 1 and 2 show GRF sources for  
the month of December and for FY 2020 through December, respectively. GRF sources consist  
of both federal grants and state-source receipts, such as tax revenue, nontax revenue, and  
transfers in.  
Chart 1, below, shows cumulative YTD variances of GRF sources each month through  
December 2019.  
Chart 1: Cumulative Variances of GRF Sources in FY 2020  
(
Variances from Estimates, $ in millions)  
$200  
$150  
$100  
$50  
$0  
-
$50  
-
-
-
-
-
$100  
$150  
$200  
$250  
$300  
Jul-19  
Aug-19  
Sep-19  
Oct-19  
Nov-19  
Dec-19  
Federal Grants  
Tax Revenue  
Total GRF Sources  
The sales and use tax and the commercial activity tax (CAT) posted positive YTD  
variances of $79.5 million and $22.7 million, respectively. Also, the foreign insurance tax and  
the domestic insurance tax were above their respective YTD estimates by $16.0 million and  
1 This report compares actual monthly and YTD GRF revenue sources to OBM’s estimates. If  
actual receipts were higher than estimate, that GRF source is deemed to have a positive variance.  
Alternatively, a GRF source is deemed to have a negative variance if actual receipts were lower than  
estimate.  
2 Federal grants are typically federal reimbursements for Medicaid and other human services  
programs.  
Budget Footnotes  
P a g e | 4  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
$
3.8 million. On the other hand, most of the remaining GRF taxes experienced negative  
variances through December 2019: the financial institutions tax (FIT) had a shortfall of  
3
$
12.5 million, the majority of which occurred in the October-December period; the three  
utility-related taxes (the kilowatt-hour excise tax, the public utility tax, and the natural gas  
consumption tax) were collectively $9.2 million below projections; the negative variance for the  
personal income tax (PIT) was $2.8 million; the alcoholic beverage tax was $2.6 million below its  
anticipated level; and the cigarette and other tobacco products tax was $2.0 million short of  
expectation.  
For the month of December 2019, GRF sources of $3.20 billion were $284.9 million (9.8%)  
above estimate. Though GRF tax sources posted a small negative variance of $1.8 million (just  
0
.1%), federal grants were $283.7 million above estimate (27.9%), reversing a timing-related  
shortfall of $223.7 million in November 2019. Also, nontax revenue was above estimate by  
2.9 million (189.3%). No GRF transfers in occurred or were anticipated in December. Regarding  
$
GRF tax sources, a negative variance of $34.7 million for the sales and use tax partially offset a  
positive one of $35.6 million for the personal income tax; and a CAT shortfall of $1.2 million  
cancelled out a positive variance of the same amount for the cigarette tax. The collective receipts  
for the utility-related taxes were on target relative to the cumulative estimate, and combined  
receipts for the insurance taxes were $1.5 million above estimates. Refunds for the FIT totaled  
$
$
9.0 million when they were estimated to be $4.2 million, resulting in a negative variance of  
4.8 million for the month.  
As shown in Table 2, FY 2020 GRF sources through December were $719.7 million (4.3%)  
above sources in the corresponding period in FY 2019. Except for transfers in which was slightly  
below its FY 2019 level, revenue from the other GRF categories grew relative to receipts in the  
previous year. First-half receipts for federal grants, tax sources, and nontax revenue increased  
$
367.0 million, $313.8 million, and $39.5 million, respectively. Growth in GRF tax revenue was  
mostly due to the sales tax ($253.1 million), the PIT ($58.0 million), and the CAT ($39.3 million).  
Receipts fell for the utility-related taxes ($24.4 million) due to lower energy prices this year, and  
the cigarette tax ($17.8 million), which is the normal trend.  
Sales and Use Tax  
The sales and use tax has been above estimate throughout FY 2020. First-half receipts to  
the GRF totaled $5.59 billion, an amount $79.5 million (1.4%) above estimate, with both the  
nonauto and the auto portions of the tax above projections. Total sales and use tax revenue was  
also $253.1 million (4.7%) above receipts in FY 2019 through December. For the latest month,  
however, receipts of $958.4 million for this GRF source were $34.7 million (3.5%) below estimate  
due to a shortfall from the nonauto sales and use tax. Sales and use tax receipts were essentially  
flat relative to revenue in December 2018. For analysis and forecasting, revenue from the sales  
and use tax is separated into two parts: auto and nonauto. Auto sales and use tax collections  
generally arise from the sale of motor vehicles, but auto taxes arising from leases are paid at the  
lease signing and are mostly recorded under the nonauto tax instead of the auto tax.  
3 A negative variance in FIT collections through the first half of the year is not uncommon.  
Annual FIT returns are due in October, so receipts in the second fiscal quarter reflect a reconciliation  
between prior estimated payments (typically January, March, and May) and final reported tax liability. A  
first-half negative variance means the volume of refunds was higher than expected.  
Budget Footnotes  
P a g e | 5  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
Nonauto Sales and Use Tax  
In December, the performance of the nonauto sales and use tax was poor for only the  
second time in FY 2020. GRF receipts totaling $839.0 million missed the estimate by $34.3 million  
(
$
3.9%). The monthly collection reduced the cumulative YTD positive variance of this GRF source to  
40.5 million (0.9%), down from a positive variance of $74.8 million during the first five months of  
FY 2020. For the fiscal year to date, GRF receipts of $4.79 billion were $195.8 million (4.3%) above  
revenue in the corresponding period in FY 2019.  
Nonauto sales tax receipts have continued to grow in FY 2020, though the growth rate  
has slipped in the latest months. Compared to revenue in the same month in 2018, December  
revenue decreased $6.0 million (0.7%); and combined receipts in November and December this  
year were below estimates by $15.0 million (0.9%), and $30.1 million (1.8%) above revenue in the  
4
corresponding two-month period in 2018. Chart 2, below, shows year-over-year growth in  
nonauto sales tax collections.  
Chart 2: Nonauto Sales and Use Tax Receipts Trend  
Actual vs. Prior Year (with Tax Base Adjustment)  
(
Three-month Moving Average)  
7.0%  
6.0%  
5.0%  
4.0%  
3.0%  
2.0%  
1.0%  
0.0%  
Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19  
Auto Sales and Use Tax  
The auto sales and use tax has been solid this fiscal year. YTD GRF revenue from this  
source totaled $800.9 million through December, an amount $39.0 million (5.1%) above  
estimates. YTD collections were also $57.3 million (7.7%) above receipts during the corresponding  
period in FY 2019. Though the tax had been above estimate each earlier month of the fiscal year,  
December revenue of $119.4 million was $0.4 million (0.4%) short of projection. Revenue was  
also $6.2 million (5.4%) above collections in the same month in 2018.  
4 Through October, this GRF source was 1.8% above estimate and 5.6% above total revenue in the  
first four months of FY 2019.  
Budget Footnotes  
P a g e | 6  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
Chart 3: Auto Sales and Use Tax Receipts Trend  
Actual vs. Prior Year  
(
Three-month Moving Average)  
10.0%  
9.0%  
8.0%  
7.0%  
6.0%  
5.0%  
4.0%  
3.0%  
2.0%  
1.0%  
0.0%  
Chart 3 shows year-over-year growth in auto sales and use tax collections. Gains in the tax  
base reflect both higher vehicle prices paid by consumers (as consumer tastes and preferences  
have shifted away from cars toward trucks, sport-utility vehicles, and crossovers) and increases in  
the number of units sold, according to data provided by the Ohio Bureau of Motor Vehicles,  
shown below. Through December 2019, the number of motor vehicles titled grew 2.7% from the  
corresponding period in FY 2019; both components of the auto taxable base increased, and the  
increase for purchases of used motor vehicles was substantial (which reflects a rise in the supply  
of used trucks in that market).  
Spending  
in millions)  
FY 2020  
Titles  
196,577  
Average Price  
(
New vehicles  
Used vehicles  
Total  
$7,143  
$36,337  
$9,657  
876,161  
$8,461  
1,072,738  
$15,604  
$14,546  
Growth from FY 2019  
New vehicles  
Used vehicles  
Total  
0.2%  
3.3%  
2.7%  
4.4%  
10.1%  
7.4%  
4.3%  
6.5%  
4.6%  
Nationally, unit sales of light vehicles (autos and light trucks) fell in calendar year  
(CY) 2019. The auto industry sold about 17.0 million units, approximately 1.4% below unit sales in  
CY 2018. Sales of cars plunged nearly 11% while those of light trucks increased 2.8%.  
Budget Footnotes  
P a g e | 7  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
Personal Income Tax  
Through December, YTD PIT GRF receipts of $4.43 billion were $2.8 million (0.1%) below  
projections, as revenue slipped in the second fiscal quarter. This tax source recorded a surplus of  
$18.8 million in the first fiscal quarter, but posted a shortfall of $21.6 million in the next, though  
December revenue from the PIT was good. December GRF receipts of $829.3 million were above  
estimates by $35.6 million (4.5%), partially reversing a shortfall of $36.6 million in November  
(
$
receipts are affected by a 3.3% withholding rate reduction earlier this calendar year. Compared  
to PIT receipts from the corresponding period one year ago, YTD FY 2020 revenue increased  
which came after a deficit of $20.6 million in October). December PIT revenue was also  
67.8 million (8.9%) above revenue in the same month in 2018. Comparisons with year-ago  
5
$58.0 million (1.3%).  
PIT revenue to the GRF is comprised of gross collections, minus refunds and distributions to  
the Local Government Fund (LGF). Gross collections consist of employer withholdings, quarterly  
6
estimated payments, trust payments, payments associated with annual returns, and other  
miscellaneous payments. The performance of the tax is typically driven by employer withholdings,  
which is the largest component of gross collections (about 81% of gross collections in FY 2019).  
Larger than expected refunds could also greatly affect the monthly performance of the tax.  
In December, gross collections were above projections by $17.9 million. Employer  
withholding was $12.1 million above estimate, quarterly estimated payments were $6.3 million  
above projections, and trust payments had a surplus of $1.4 million. Those positive variances  
were partially offset by a negative variance of $1.9 million for annual return payments; and  
smaller than expected refunds contributed $18.0 million to the PIT monthly positive variance of  
$
35.6 million.  
For the YTD, revenues from each component of the PIT relative to estimates and  
revenue received in FY 2019 are detailed in the table below. Gross collections were  
38.9 million above estimate, with all components above their YTD estimates. However,  
$
refunds and distributions to LGF were $36.6 million and $5.0 million, respectively, higher than  
expected, which resulted in the YTD negative variance of $2.8 million. FY 2020 refunds and LGF  
distributions also increased compared to their amounts in the corresponding period last fiscal  
year. In part, the increase in LGF distributions is due to an increase in the allocation of GRF tax  
revenue to the LGF. H.B. 166 included a provision in uncodified law increasing the allocation  
from 1.66% of GRF tax revenue to 1.68% during the current biennium.  
5 Effective January 1, 2019, Ohio employer withholding tax rates were reduced by 3.3% in order to be  
st  
fully consistent with the income tax rate reductions enacted in 2015 (H.B. 64 of the 131 General Assembly).  
6 Quarterly estimated payments are made by taxpayers who expect to be underwithheld by  
more than $500. Payments are due in April, June, and September of an individual’s tax year and January  
of the following year. Most estimated payments are made by high-income taxpayers.  
Budget Footnotes  
P a g e | 8  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
FY 2020 PIT Revenue Variance and Annual Change by Component  
YTD Variance from Estimate  
Changes from FY 2019  
Category  
Amount  
$ in millions)  
Percent  
(%)  
Amount  
($ in millions)  
Percent  
(%)  
(
Withholding  
$35.1  
$0.3  
0.8%  
$99.4  
$27.4  
$2.6  
2.2%  
9.3%  
Quarterly Estimated Payments  
Trust Payments  
0.1%  
13.7%  
0.5%  
0.9%  
0.8%  
9.1%  
2.4%  
-0.1%  
$2.6  
13.7%  
19.4%  
3.4%  
Annual Return Payments  
Miscellaneous Payments  
Gross Collections  
$0.6  
$21.3  
$1.2  
$0.3  
$38.9  
$36.6  
$5.0  
$151.9  
$81.6  
$12.3  
$58.0  
3.1%  
Less Refunds  
22.9%  
6.1%  
Less LGF Distribution  
GRF PIT Revenue  
-$2.8  
1.3%  
Through December, FY 2020 employer withholding receipts7 grew 2.2%, despite the  
reduction in withholding rates described above. The chart below illustrates the growth of  
monthly employer withholdings on a three-month moving average relative to one year ago. It  
shows both the actual change in withholding receipts in FY 2020 and estimated withholding  
receipts adjusted for the decrease in withholding tax rates in January.  
Chart 4: Monthly Witholding Receipts Trend  
Actual vs. Prior Year  
(
Three-month Moving Average)  
9.0%  
8.0%  
7.0%  
6.0%  
5.0%  
4.0%  
3.0%  
2.0%  
1.0%  
0.0%  
Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19  
Actual Adjusted  
7 Withholding receipts consist of monthly employer withholding (about 99% of the total) and  
annual employer withholding.  
Budget Footnotes  
P a g e | 9  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
Commercial Activity Tax  
The CAT exhibited varied performances in the first two quarters of FY 2020. In the first  
three months of the fiscal year, receipts to the GRF exceeded OBM’s estimate by $33.6 million,  
including a monthly surplus of $18.2 million in August for the first payment for quarterly calendar  
return taxpayers. However, second-quarter CAT revenue to the GRF was $10.9 million (2.6%)  
below estimate, resulting in a YTD positive variance of $22.7 million (2.9%) in the first-half of  
FY 2020. Remarkably, second-quarter CAT receipts were also $13.2 million (3.2%) below receipts  
in the corresponding period in FY 2019. Overall, YTD GRF revenue from this source totaling  
$808.0 million was $39.3 million (5.1%) above revenues in the corresponding period in FY 2019.  
Almost half of the increase in receipts compared to FY 2019 were driven by a decline in  
8
tax credits claimed against the CAT. Through December, FY 2020 gross collections grew only  
2
growing 8.8% in the first quarter in FY 2020 relative to the year-earlier period, in the  
October-December period this fiscal year, gross collections actually fell 3.1%.  
.5% while refunds and credits fell 24.1%, resulting in a higher growth rate for the GRF. After  
Cigarette and Other Tobacco Products Tax  
FY 2020 first-half revenue to the GRF from the cigarette and other tobacco products tax  
totaled $402.5 million, $2.0 million (0.5%) below estimate and $17.8 million (4.2%) below  
receipts through December in FY 2019. YTD revenue included $362.6 million from the sale of  
cigarettes and $39.9 million from the sale of other tobacco products. Compared to FY 2019,  
receipts from cigarette sales fell $20.2 million while those from the sale of other tobacco  
products increased $2.4 million. On a yearly basis, revenue from the cigarette and other  
tobacco products tax usually trends downward generally at a slow pace due to a decline of  
cigarette revenue, though receipts from the sales of other tobacco products increase yearly.  
H.B. 166 levied a tax of 10¢ per milliliter (or gram) of vapor product (depending on the  
form of the product). A vapor product is defined as any liquid solution or other substance that  
contains nicotine and is depleted as it is used in an electronic smoking product. The tax is to be  
paid by distributors beginning October 1, 2019. The taxation of vapor products is estimated to  
increase GRF revenue by $3.2 million, with most of the revenue occurring in the January to June  
period.  
Other Taxes  
The kilowatt-hour tax generated $165.4 million during the first six months of the fiscal  
year. This amount was $3.8 million (2.2%) below estimate, and $13.8 million (7.7%) below  
revenue during the comparable months of FY 2019. The performance of the tax is largely due to  
milder weather than expected and lower than anticipated electricity consumption. The tax base  
generally is kilowatt-hours of electricity used, i.e., it generally does not depend on the price of  
electricity. Half of the allocation of GRF tax revenue to the Public Library Fund is debited against  
this tax for accounting purposes, thus good GRF tax revenue performance overall can make the  
performance of this tax look relatively bad.  
8 A number of Ohio’s business tax credits can be claimed against more than one type of tax, but  
many are claimed against the CAT, which is imposed on the privilege of doing business in Ohio.  
Budget Footnotes  
P a g e | 10  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
YTD through December receipts from the public utility excise tax were $64.4 million,  
4.0 million (5.8%) below estimate and $8.6 million (11.8%) lower than during July-December  
018. Most receipts from this tax are in the second month of each calendar quarter, with the  
$
2
largest receipts usually in May. Deliveries by natural gas utilities account for a large part of the  
total. The drop in revenues from the public utility excise tax appears to be accounted for by  
9
lower prices paid for natural gas by industrial and electric power customers. Quantities of  
natural gas consumed in the Ohio market have grown this year, entirely due to continued  
growth of consumption by electric power producers.  
Receipts from the natural gas consumption (Mcf) tax were $18.3 million in the first half  
of this fiscal year, $1.5 million (7.6%) below estimate and $2.0 million (9.7%) lower than in the  
year-earlier period. Payments in May account for nearly half of annual receipts from this tax in  
most years. Tax rates per Mcf distributed to end users are lower for large natural gas  
consumers, and the decline in tax revenues this fiscal year may reflect a drop in deliveries to  
smaller customers, including residential, commercial, and industrial natural gas consumers.  
The foreign insurance tax generated $172.0 million during the first half of FY 2020,  
16.0 million (10.2%) above estimate, and $12.9 million (8.1%) above receipts in the  
$
corresponding period in FY 2019. The reason for the jump in collections from this tax source is  
unclear at this time. This tax is paid by insurance companies headquartered in other states  
based on premiums they receive to provide insurance covering risks located in Ohio. But, the  
revenue experience so far this year reveals little about the full fiscal year experience from the  
tax as payments received so far represent advance payments based on previous year tax  
liabilities before credits.  
Similarly, only $3.8 million has been received so far in FY 2020 from the domestic  
insurance tax (paid by insurance companies headquartered in Ohio), but that says little about  
the full year experience: virtually all revenue from the tax is received in May and June each  
fiscal year.  
Nontax revenue  
YTD GRF nontax revenue totaling $130.2 million was $34.6 million above estimate and  
39.5 million above such revenue in the first six months of FY 2019. Earnings on investments  
$
contributed $14.0 million to the YTD positive variance, though the three federal funds rate cuts  
implemented by the Federal Reserve in the last few months are likely to result in lower  
investment earnings in the second half of the year.  
9 The following are the four types of consumers: residential, commercial, industrial, and electric  
power generation.  
Budget Footnotes  
P a g e | 11  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
Table 3: General Revenue Fund Uses  
Actual vs. Estimate  
Month of December 2019  
(
$ in thousands)  
(
Actual based on OAKS reports run January 7, 2020)  
Program Category  
Actual  
Estimate* Variance Percent  
Primary and Secondary Education  
Higher Education  
$619,163  
$196,434  
$6,770  
$621,586  
$201,028  
$7,117  
-$2,423  
-$4,594  
-$347  
-0.4%  
-2.3%  
-4.9%  
-0.9%  
Other Education  
Total Education  
$822,367  
$829,731  
-$7,364  
Medicaid  
$1,668,974 $1,636,793 $32,181  
$110,898 $118,461 -$7,562  
$1,779,872 $1,755,253 $24,619  
2.0%  
-6.4%  
1.4%  
Health and Human Services  
Total Health and Human Services  
Justice and Public Protection  
General Government  
$193,242  
$34,259  
$167,153 $26,089  
15.6%  
$44,452 -$10,193 -22.9%  
$211,605 $15,896 7.5%  
Total Government Operations  
$227,501  
Property Tax Reimbursements  
Debt Service  
$1,727  
$18,987  
$20,714  
$14,577 -$12,850 -88.2%  
$19,208 -$222 -1.2%  
$33,785 -$13,072 -38.7%  
Total Other Expenditures  
Total Program Expenditures  
Transfers Out  
$2,850,454 $2,830,375 $20,079  
$0 $0 $0  
$2,850,454 $2,830,375 $20,079  
0.7%  
---  
Total GRF Uses  
0.7%  
*
September 2019 estimates of the Office of Budget and Management.  
Detail may not sum to total due to rounding.  
Budget Footnotes  
P a g e | 12  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
Table 4: General Revenue Fund Uses  
Actual vs. Estimate  
FY 2020 as of December 31, 2019  
(
$ in thousands)  
(
Actual based on OAKS reports run January 7, 2020)  
Program Category  
Actual  
Estimate*  
Variance Percent FY 2019** Percent  
Primary and Secondary Education  
Higher Education  
$4,175,558 $4,197,170 -$21,611  
$1,132,287 $1,200,045 -$67,758  
-0.5% $4,197,036  
-5.6% $1,147,019  
-0.5%  
-1.3%  
12.4%  
-0.6%  
Other Education  
$50,769  
$51,732  
-$963  
-1.9%  
$45,173  
Total Education  
$5,358,614 $5,448,947 -$90,333  
-1.7% $5,389,228  
Medicaid  
$8,424,866 $8,478,558 -$53,693  
-0.6% $7,789,622  
8.2%  
10.0%  
8.3%  
Health and Human Services  
Total Health and Human Services  
$742,522  
$781,551 -$39,029  
-5.0%  
$675,073  
$9,167,388 $9,260,109 -$92,721  
-1.0% $8,464,694  
Justice and Public Protection  
General Government  
$1,264,437 $1,285,511 -$21,074  
$221,776  
-1.6% $1,197,257  
5.6%  
14.3%  
6.8%  
$253,720 -$31,945 -12.6%  
$193,952  
Total Government Operations  
$1,486,213 $1,539,231 -$53,018  
-3.4% $1,391,209  
Property Tax Reimbursements  
Debt Service  
$905,289  
$903,325  
$926,004 -$20,715  
$903,838 -$513  
-2.2%  
-0.1%  
$905,520  
$934,361  
0.0%  
-3.3%  
-1.7%  
Total Other Expenditures  
$1,808,614 $1,829,842 -$21,228  
-1.2% $1,839,880  
Total Program Expenditures  
Transfers Out  
$17,820,829 $18,078,129 -$257,300  
-1.4% $17,085,011  
4.3%  
$662,799  
$669,975  
-$7,177  
-1.1%  
$752,840 -12.0%  
3.6%  
Total GRF Uses  
$18,483,627 $18,748,104 -$264,477  
-1.4% $17,837,851  
*
*
September 2019 estimates of the Office of Budget and Management.  
*Cumulative totals through the same month in FY 2019.  
Detail may not sum to total due to rounding.  
Budget Footnotes  
P a g e | 13  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
Table 5: Medicaid Expenditures by Department  
Actual vs. Estimate  
(
$ in thousands)  
(
Actuals based on OAKS report run on January 7, 2020)  
Month of December 2019  
Year to Date through December 2019  
Department  
Medicaid  
GRF  
Actual  
Estimate* Variance Percent  
Actual  
Estimate*  
Variance Percent  
$1,607,028 $1,573,911 $33,117  
$632,031 $654,679 -$22,648  
$2,239,059 $2,228,589 $10,470  
2.1% $8,018,090  
-3.5% $4,222,338  
$8,073,967  
-$55,877  
-0.7%  
-2.4%  
-1.3%  
Non-GRF  
$4,326,209 -$103,871  
All Funds  
0.5% $12,240,427 $12,400,176 -$159,749  
Developmental Disabilities  
GRF  
$52,173  
286,925  
339,098  
$53,533  
-$1,360  
-2.5%  
$348,062  
$348,091  
$1,271,747  
$1,619,838  
-$29  
-$6,213  
-$6,242  
0.0%  
-0.5%  
-0.4%  
$
$203,667 $83,258  
$257,199 $81,899  
40.9% $1,265,534  
31.8% $1,613,596  
Non-GRF  
All Funds  
$
Job and Family Services  
GRF  
$8,981  
$17,740  
26,721  
$8,401  
$19,426  
$27,827  
$580  
-$1,686  
-$1,106  
6.9%  
-8.7%  
-4.0%  
$53,481  
$98,331  
$50,849  
$88,208  
$2,633  
$10,122  
$12,755  
5.2%  
11.5%  
9.2%  
Non-GRF  
$
$151,812  
$139,057  
All Funds  
Health, Mental Health and Addiction, Aging, Pharmacy Board, and Education  
GRF  
$792  
$948  
$2,990  
$3,938  
-$156 -16.5%  
-$555 -18.6%  
-$711 -18.1%  
$5,233  
$22,155  
$27,388  
$5,652  
$20,288  
$25,939  
-$419  
$1,868  
$1,449  
-7.4%  
9.2%  
5.6%  
Non-GRF  
$2,435  
$
3,227  
All Funds  
All Departments:  
GRF  
$1,668,974 $1,636,793 $32,181  
$939,131 $880,761 $58,369  
2,608,105 $2,517,554 $90,551  
2.0% $8,424,866 $8,478,558  
6.6% $5,608,358 $5,706,452  
-$53,693  
-$98,094  
-0.6%  
-1.7%  
-1.1%  
Non-GRF  
All Funds  
$
3.6% $14,033,223 $14,185,010 -$151,787  
*
September 2019 estimates from the Department of Medicaid.  
Detail may not sum to total due to rounding.  
Budget Footnotes  
P a g e | 14  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
Table 6: All Funds Medicaid Expenditures by Payment Category  
Actual vs. Estimate  
(
$ in thousands)  
(
Actuals based on OAKS report run on January 9, 2020)  
Month of December 2019  
Year to Date through December 2019  
Actual Estimate* Variance Percent  
Payment Category  
Actual  
Estimate* Variance Percent  
Managed Care  
CFC†  
$1,643,305 $1,597,720 $45,585  
2.9% $8,556,034 $8,543,206  
$12,829  
-$19,135  
$23,330  
-$15,123  
$1,676  
0.2%  
-0.6%  
1.1%  
-1.1%  
0.4%  
1.7%  
-0.1%  
$505,519  
$400,990  
$231,223  
$79,908  
$491,967 $13,551  
$363,104 $37,886  
2.8% $2,938,599  
10.4% $2,198,720  
-2.8% $1,403,906  
$2,957,734  
$2,175,390  
$1,419,029  
$459,940  
Group VIII  
ABD†  
$237,979  
$76,989  
-$6,756  
$2,918  
-$3,654  
$1,639  
ABD Kids  
My Care  
P4P†  
3.8% $461,616  
-1.6% $1,348,997  
0.8% $204,197  
$219,544  
$206,121  
$223,198  
$204,482  
$1,326,631  
$204,482  
$22,366  
-$286  
Fee-For-Service  
ODM Services  
DDD Services  
$796,225  
$367,920  
$326,104  
$0  
$734,008 $62,217  
$373,505 -$5,585  
$252,012 $74,092  
8.5% $4,472,163 $4,526,067  
-$53,904  
-$55,718  
-$2,129  
$11,202  
-$7,259  
-1.2%  
-2.6%  
-0.1%  
1.7%  
-1.5% $2,105,823  
29.4% $1,565,903  
$2,161,542  
$1,568,032  
$669,444  
$127,049  
Hospital – HCAP†  
Hospital – Other  
$0  
$0  
---  
$680,646  
$119,790  
$102,202  
$108,492  
-$6,290  
-5.8%  
-5.7%  
Premium Assistance  
Medicare Buy-In  
Medicare Part D  
$94,493  
$55,672  
$38,821  
$96,866  
$57,098  
$39,768  
-$2,373  
-$1,426  
-$947  
-2.4%  
-2.5%  
-2.4%  
$549,647  
$316,624  
$233,024  
$562,848  
$325,940  
$236,908  
-$13,201  
-$9,316  
-$3,884  
-2.3%  
-2.9%  
-1.6%  
Administration  
Total  
$74,081  
$88,960 -$14,878 -16.7%  
$455,379  
$552,890  
-$97,511 -17.6%  
$2,608,105 $2,517,554 $90,551  
3.6% $14,033,223 $14,185,010 -$151,787 -1.1%  
*
P4P – Pay For Performance.  
September 2019 estimates from the Department of Medicaid.  
CFC – Covered Families and Children; ABD – Aged, Blind, and Disabled; HCAP – Hospital Care Assurance Program;  
Detail may not sum to total due to rounding.  
Budget Footnotes  
P a g e | 15  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
EMexlanpey Cearnter,dDiriecttorures10  
Ivy Chen, Principal Economist  
Overview  
For the first half of FY 2020, GRF uses totaled $18.48 billion. These uses were under  
estimate by $264.5 million (1.4%). All program categories, as well as transfers out, were under  
estimate YTD. YTD variances in GRF uses are shown in the preceding Table 4. Higher Education  
had the largest YTD negative variance ($67.8 million), followed by Medicaid ($53.7 million).  
Other program categories that were more than $20.0 million under their YTD estimates are:  
Health and Human Services ($39.0 million), General Government ($31.9 million), Primary and  
Secondary Education ($21.6 million), Justice and Public Protection ($21.1 million), and Property  
Tax Reimbursements ($20.7 million).  
The preceding Table 3 shows GRF uses compared to estimates for the month of  
December. GRF uses in December totaled $2.85 billion and were above estimate by  
$
$
20.1 million (0.7%). This positive variance was dominated by positive December variances of  
32.2 million in Medicaid and $26.1 million in Justice and Public Protection. These positive  
variances were partially offset by negative monthly variances in the other program categories.  
The following sections give more details about Medicaid GRF and non-GRF variances, as well as  
the most significant of the GRF variances in other categories.  
Medicaid  
GRF Medicaid expenditures were above their monthly estimate in December by  
$32.2 million (2.0%), but remained below their yearly estimate by $53.7 million (0.6%). Non-GRF  
Medicaid expenditures were also above their monthly estimate, by $58.4 million (6.6%) and  
below their YTD estimate by $98.1 million (1.7%). Including both the GRF and non-GRF, all funds  
Medicaid expenditures were $90.6 million (3.6%) above estimate in December and $151.8 million  
(
GRF and non-GRF Medicaid expenditures contain federal and state dollars.  
1.1%) below the YTD estimate at the end of December. As a joint federal-state program, both  
Table 5 shows GRF and non-GRF Medicaid expenditures for the Ohio Department of  
Medicaid (ODM), the Ohio Department of Developmental Disabilities (ODODD), and six other  
“sister” agencies that also take part in administering Ohio Medicaid. ODM and ODODD account  
for about 99% of the total Medicaid budget. Therefore, they generally also account for the  
majority of the variances in Medicaid expenditures. The all funds positive monthly variance in  
December was primarily driven by a positive variance of $81.9 million for ODODD, which partially  
offset this agency’s timing-related negative variance from the previous five months, resulting in a  
negative YTD all funds variance of $6.2 million. ODM also had a positive variance in December  
(
agencies – Job and Family Services, Health, Aging, Mental Health and Addiction Services, State  
$10.5 million), but maintained a significant negative variance of $159.7 million YTD. The other six  
10 This report compares actual monthly and YTD expenditures from the GRF to OBM’s estimates.  
If a program category’s actual expenditures were higher than estimate, that program category is  
deemed to have a positive variance. The program category is deemed to have a negative variance when  
its actual expenditures were lower than estimate.  
Budget Footnotes  
P a g e | 16  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
Board of Pharmacy, and Education – account for the remaining 1% of the total Medicaid budget.  
Unlike ODM and ODODD, the six “sister” agencies incur only administrative spending.  
Table 6 shows all funds Medicaid expenditures by payment category. Expenditures were  
below their YTD estimates for three of the four payment categories. Administration  
(
(
$97.5 million, 17.6%) had the largest overall negative variance, followed by Fee-For-Service  
FFS, $53.9 million, 1.2%), and Premium Assistance ($13.2 million, 2.3%). Managed Care  
expenditures were above their YTD estimates by $12.8 million (0.2%).  
The YTD variance in the Administration category is mostly due to timing and is expected  
to smooth out throughout the fiscal year.  
The YTD variance in FFS was brought closer to estimate by the resolution of a timing  
delay in the “DDD Services” category. As reported in last month’s Budget Footnotes the DDD  
Services category had a negative monthly variance in November of $70.1 million. This negative  
variance was offset in December by a positive variance of $74.1 million. The main expenditure  
item contributing to this resolution was ODODD’s cost report adjustment. The cost report is a  
reporting mechanism that captures Medicaid-eligible costs and allows ODODD to disburse  
federal funds to counties based on Medicaid-allowable costs that have been incurred by those  
counties for their services.  
Expenditures in the Managed Care category were pushed above their YTD estimate by a  
positive variance in December of $45.6 million (2.9%). The largest factor contributing to these  
positive variances was the positive monthly and YTD variances in Group VIII11 expenditures of  
$
37.9 million and $23.3 million, respectively. The positive variances for Group VIII were mainly  
due to higher than expected caseloads. For the first six months of FY 2020, the average monthly  
managed care caseloads for Group VIII were 1.5% (8,210) above estimate.  
Higher Education  
The negative YTD variance in the Higher Education category increased by $4.6 million in  
December to reach $67.8 million (5.6%). As reported in last month’s Budget Footnotes,  
expenditures from a number of line items have been delayed. Of the seven line items  
mentioned last month, disbursements still had not begun, at the end of December, from five of  
them. These are listed below with their negative YTD variances indicated in parentheses:  
235535, Ohio Agricultural Research and Development Center ($18.7 million);  
235511, Cooperative Extension Service ($12.6 million);  
235507, OhioLINK ($3.0 million);  
235510, Ohio Supercomputer Center ($2.2 million); and  
235556, Ohio Academic Resources Network ($1.5 million).  
Once agreements between the Department and these organizations are finalized, these  
negative variances should be reversed.  
11 Group VIII refers to those who were newly eligible for Medicaid under the Affordable Care Act  
ACA). Expenditures for these enrollees are reimbursed by the federal government at a rate of 91.5% in  
(
FY 2020 as opposed to about 63% for most other enrollees.  
Budget Footnotes  
P a g e | 17  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
In addition to these, item 235563, Ohio College Opportunity Grant, was under its YTD  
estimate by $7.3 million at the end of December. This item funds Ohio’s need-based financial  
aid for higher education students.  
Health and Human Services  
The Health and Human Services category was under its YTD estimate by $39.0 million  
5.0%) at the end of December. For the month of December, this category was under estimate  
(
by $7.6 million.  
The YTD variance was dominated by a negative variance of $23.8 million in the Ohio  
Department of Mental Health and Addiction Services (OMHAS). This negative variance,  
however, is primarily from expenditures in October. For the month of December, OMHAS had a  
positive variance of $6.4 million. OMHAS’s YTD and monthly variances were dominated by  
item 336421, Continuum of Care Services, which had a positive variance of $5.4 million in  
December that partially offset a large negative variance in October, leaving a negative YTD  
variance at the end of December of $14.6 million. Item 336421 is used primarily to distribute  
funds to local boards of alcohol, drug addiction, and mental health.  
Also contributing to the negative YTD variance in this category was the Department of  
Health (DOH), which had a negative YTD variance at the end of December of $9.2 million. This  
YTD variance was a result of an accumulation of negative monthly variances for most months of  
the fiscal year, including a negative variance of $3.6 million in December. DOH’s variances are  
spread out over most of its line items.  
The agency in this category with the third highest negative YTD variance is the  
Department of Veterans Service (DVS), which had a negative YTD variance of $3.8 million at the  
end of December. This variance is primarily from item 900321, Veterans’ Homes, which pays  
the operating costs of the state’s two veterans’ homes.  
Finally, the Ohio Department of Job and Family Services (ODJFS), while not having a  
significant YTD variance, had a negative December variance of $9.4 million. This variance was  
caused by a negative variance of $10.0 million in item 600413, Child Care State/Maintenance of  
Effort, which offset a large positive variance in October, leaving the item with a negative  
variance of $2.7 million for the YTD.  
General Government  
The General Government category had a negative YTD variance of $31.9 million (12.6%)  
at the end of December and a negative variance of $10.2 million for the month of December.  
These variances were largely the result of a negative monthly variance of $7.8 million and a  
negative YTD variance of $13.0 million in item 775470, Public Transportation – State, in the  
Department of Transportation and a negative monthly variance of $5.0 million and a negative  
YTD variance of $10.0 million in item 700417, Soil and Water Phosphorus Program, in the  
Department of Agriculture. The variances in both of these items were due to delays in  
payments for these programs.  
Justice and Public Protection  
The Justice and Public Protection category had a positive variance for the month of  
December of $26.1 million, which decreased this category’s negative YTD variance to  
$
21.1 million (1.6%). The positive December variance was mainly caused by a positive variance  
Budget Footnotes  
P a g e | 18  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
of $16.6 million for the Department of Rehabilitation and Correction (DRC) and a positive  
variance of $11.0 million for the Public Defender. Both of these agencies had significant  
negative variances for the month of November. DRC’s positive variance in December was due  
to a positive variance of $17.4 million in item 501405, Halfway House. This item had a small  
negative YTD variance at the end of November, so ended up with a positive YTD variance of  
$
15.9 million at the end of December. The Public Defender’s December variance was due to a  
positive variance of $11.1 million in item 019501, County Reimbursement. This December  
variance partially offset negative variances from prior months resulting in a negative YTD  
variance of $1.6 million for this item at the end of December.  
Budget Footnotes  
P a g e | 19  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
Issue Updates  
Overview of State Debt and Bond Issuance  
Eric Makela, Economist  
The issuance of debt has historically been an important component for the upkeep of  
Ohio’s public infrastructure. Currently, Ohio maintains the following credit ratings on its general  
obligation (G.O.) bonds: Aa1 by Moody’s, AA+ by S&P Global, and AA+ by Fitch. Each ratings  
nd  
agency has given Ohio a “high investment grade” rating, and the 2 highest rating that is  
possible among public sector debt classes. In evaluating the state’s investment rating, ratings  
agencies analyze a combination of factors, including the state’s current debt burden, budgetary  
performance, financial management, private sector economic performance, and other  
state-specific factors. Ohio G.O. bonds have been generally stable at these current ratings since  
2
010.  
Under the state Constitution, Ohio’s government is authorized to issue up to $750,000  
of unsecured debt for the purpose of casual budget deficits. Additionally, the Constitution  
permits secured debt to be issued for specific purposes as either a general obligation or special  
obligation of the state. G.O. debt is secured by the full ability of the state to raise revenues via  
taxation or general operations. Special obligation (S.O.) debt is typically secured by cash flow  
from lease rental agreements on the operation of public facilities. Additionally, the Treasurer of  
State (TOS) can issue Grant Anticipation Revenue Vehicles (GARVEEs) to fund highway  
construction projects. The debt service on GARVEEs is funded by federal transportation grants.  
Importantly, Ohio’s Constitution includes an upper limit on the amount of selected  
G.O. debt the state can maintain at one time. Debt which is a direct obligation of the state  
cannot be issued if its issuance will cause the state’s debt service ratio to exceed 5%. The debt  
service ratio is equal to the dollar amount of selected G.O. debt service divided by the total  
estimated GRF revenue plus net proceeds from Ohio Lottery Commission (LOT) operations  
during the fiscal year in which the obligations are to be issued. Prior to every bond issuance, the  
Office of Budget and Management certifies the total amount of debt outstanding, and  
estimates the highest future debt service ratio as a percentage of revenues.  
The table below displays both GRF debt service payments as well as the amount of  
outstanding GRF-backed debt at the end of fiscal years 2015 through 2019. As of November 15,  
2
019, the principal amount of Ohio’s outstanding GRF debt was approximately $9.55 billion. Of  
12  
this amount, $9.11 billion is subject to the 5% debt limit. From 2010 through 2019, the debt  
burden has fluctuated between 2.8% and 4.2%; the variability is largely a result of a  
restructuring of GRF debt from fiscal years 2010 through 2012. In FY 2021, the debt burden is  
currently calculated to be 3.70%.  
12 Bonds issued under the Ohio Constitution Title VIII Section 2r, Veterans Compensation, and  
bonds issued under Title VIII Sections 2p(2) and 2p(3), Third Frontier Research and Development and Site  
Development, while G.O. debt, are not subject to the 5% debt limit.  
Budget Footnotes  
P a g e | 20  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
State Debt Payments and Outstanding Debt ($ in thousands)13  
End of Fiscal Year  
GRF Debt Service  
Payments  
Principal Amount of  
Outstanding GRF Debt  
Debt Service as % of  
GRF and LOT Revenue  
2
2
2
2
2
015  
$1,278,259  
$1,314,513  
$1,328,277  
$1,338,396  
$1,402,757  
$9,354,509  
$9,271,400  
$9,450,790  
$9,746,900  
$9,496,850  
3.94%  
3.76%  
3.77%  
3.98%  
4.02%  
016  
017  
018  
019  
Ohio Department of Transportation Approves Nearly  
400 million in New Highway Construction Projects  
$
Terry Steele, Senior Budget Analyst  
In December, the Ohio Department of Transportation (ODOT) announced that  
398.0 million in new highway construction project funding was approved for the three-year  
period of FY 2020-FY 2022. This funding is part of the Major/New Construction Program  
component of ODOT’s overall construction budget, which is approved by the Department’s  
Transportation Review Advisory Council (TRAC). The Major/New Construction Program consists  
of highway projects that add capacity to the state’s network of roads and costs over  
$
1
4
$
total commitment of $1.11 billion for TRAC projects over the FY 2020-FY 2023 period.  
12.0 million. Combined with Major/New projects approved by TRAC in prior years, there is a  
TRAC approved the additional Major/New funding commitments with set spending  
amounts for each qualifying construction project. The table below summarizes these newly  
approved projects, their estimated construction costs, as well as the anticipated fiscal year in  
which the construction will take place. In addition to the construction costs of each project  
listed below, which total $348.3 million, there are some additional design and development  
costs as well as projected change order costs factored into the overall project costs. These  
other costs total almost $50.0 million.  
13 https://obm.ohio.gov/wps/portal/gov/obm/areas-of-interest/bonds-and-investors/state-  
debt-overview/.  
14 http://www.dot.state.oh.us/news/Pages/TRAC-approves-final-list-of-major-new-  
projects.aspx.  
Budget Footnotes  
P a g e | 21  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
TRAC Newly Approved New Construction Projects  
Commitment ($ millions)  
FY 2021  
Project Description  
County  
FY 2020  
$10.0  
FY 2022  
I-71 N express lane construction Franklin  
-
-
-
-
-
-
-
-
US-40 airport access  
I-70 and I-270 interchange  
I-77 widening and interchanges  
I-75 widening  
Montgomery  
$8.0  
Franklin  
Summit  
Hamilton  
Union  
-
$73.0  
-
$65.0  
-
$38.0  
US-33/SR-161 interchange  
I-475 widening  
-
$11.3  
Lucas  
-
-
$79.0  
$38.0  
$18.0  
$8.0  
SR 32 improvements  
SR-18 widening  
Clermont  
Medina  
Delaware  
-
-
-
-
-
-
US-36/SR-37 interchange  
Total  
$18.0  
$187.3  
$143.0  
All funding of Major/New Construction projects are financed out of the Highway  
Operating Fund (Fund 7002). This fund is comprised of three main sources of revenue:  
(1) federal highway trust fund distributions, (2) ODOT’s portion of revenue from the Ohio motor  
fuel tax, and (3) proceeds from bonds issued by the state and backed by future federal highway  
and Ohio motor fuel tax revenues.  
Medicaid Awards Grants to Target African American Infant  
Mortality  
Nelson V. Lindgren, Economist  
In November 2019, the Ohio Department of Medicaid (ODM) awarded a total of  
26.8 million to organizations located in nine Ohio counties to address African American infant  
$
mortality rates among the Medicaid population. These counties were targeted because over  
0% of African American infant deaths occurred in these communities in 2017. Eligible  
9
applicants included local health departments, not-for-profit organizations, universities, and  
early care and learning entities. The funds will be used to do the following: build capacity to  
expand or create services to reach at-risk African American women; fill the gaps between  
existing services and systems within these communities; increase retention of African American  
women in patient-centered, culturally appropriate, and high quality health care; and affect  
Budget Footnotes  
P a g e | 22  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
changes in attitudes and norms that contribute to disparate birth outcomes. Grant activities will  
begin January 1, 2020 and conclude December 31, 2021. The table below shows the counties  
receiving funds and the maximum amount of funding available. In addition to the nine counties,  
about $933,000 is allocated to the Medicaid Managed Care Plans, which will be used to fund  
additional interventions to improve service delivery and health outcomes.  
Infant Mortality Grant Funding Caps  
County  
Funding Amount  
$4,800,000  
Cuyahoga  
Franklin  
$4,520,000  
$3,610,000  
$2,919,999  
$2,670,000  
$2,480,000  
$1,879,997  
$1,630,000  
$1,356,920  
$933,083  
Montgomery  
Hamilton  
Lucas  
Summit  
Mahoning  
Stark  
Butler  
Medicaid Managed Care Plans  
Total Statewide  
$26,800,000  
According to the Ohio Department of Health’s 2017 Ohio Infant Mortality Report,  
82 infants died before their first birthday, resulting in an overall infant mortality rate15 of 7.2.  
9
The white and Hispanic rates were 5.3 and 7.2, respectively. However, the rate for African  
American infants was far higher with a rate of 15.6. The leading cause of infant deaths are  
prematurity-related conditions including premature birth and low birth weight, followed by  
congenital abnormalities and obstetric conditions.  
15 Infant mortality rates are measured as the number of infant deaths per 1,000 live births.  
Budget Footnotes  
P a g e | 23  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
Five Ohio Organizations Receive Drug-Free Communities Support  
Program Grants  
–Ryan Sherrock, Economist  
On October 30, 2019, the U.S. Substance Abuse and Mental Health Services  
Administration announced that five Ohio organizations received new Drug-Free Communities  
DFC) Support Program grants. Each grantee received approximately $125,000 for this first year  
of funding. The five Ohio organizations receiving new grants are:  
(
Richland Public Health (Richland County);  
HealthPath Foundation of Ohio (Hamilton County);  
Erie County Department of Health (Erie County);  
OneEighty, Inc. (Wayne County); and  
Northern Ohio Recovery Association, Inc. (Cuyahoga County).  
In addition to the first year grant, continuation grants of $125,000 per year may be  
awarded for four additional years. In 2019, 17 organizations located throughout Ohio received  
1
6
continuation grants.  
The DFC grant program was created through the Drug-Free Communities Act of 1997.  
Grants are awarded every year, including both new and continuation grants. Eligible applicants  
are community-based coalitions that address youth substance abuse. The two goals of the  
DFC program are: to establish and strengthen collaboration among nonprofit agencies and  
various government entities to support community efforts to prevent and reduce substance  
abuse among youth and to reduce substance abuse among youth and adults by addressing the  
factors in a community that increase risk and promoting factors that minimize risk. Grantees are  
expected to implement strategies that lead to community level changes. These strategies can  
include: limiting access to substances, changing the culture and context within which substance  
use decisions are made, and shifting the consequences associated with youth substance use.  
Number of Public Schools Designated for EdChoice Scholarship  
Program Grows to 1,227 for 2020-2021 School Year  
Nick Ciolli, Budget Analyst  
In October 2019, the Ohio Department of Education (ODE) released the list of public  
schools that are designated for the upcoming 2020-2021 school year (FY 2021) under the  
performance-based Educational Choice (“EdChoice”) Scholarship Program. Under the program,  
a student may receive a state scholarship to attend a participating chartered nonpublic school if  
the student’s resident district school meets one of a number of criteria largely based on low  
performance on certain aspects of the state report card. The list for the upcoming school year  
contains 1,227 schools in 426 school districts. Of those schools, 727 are newly designated  
(17 schools that are currently designated will drop off the list). As the table below shows, the  
16 Lists of grantees can be found on the website of the White House Office of National Drug  
Control Policy: www.whitehouse.gov/ondcp/grants-programs/.  
Budget Footnotes  
P a g e | 24  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
number of schools designated has grown markedly since FY 2019, when 255 schools in  
3
traditional district schools and educate about 620,000 students.  
1 districts were designated. Collectively, the 1,227 designated schools represent about 42% of  
Traditional District Schools Designated For the EdChoice Program, FY 2019-FY 2021  
Category  
FY 2019  
255  
FY 2020  
517  
160  
FY 2021  
1,227  
426  
Buildings Designated  
Districts with One or More  
Designated Buildings  
3
1
A school is designated if it meets at least one of six criteria, four of which are based on  
the school’s report card results: (1) Performance, (2) Graduation, (3) Lowest 10% on  
Performance Index (PI), and (4) Improving At-Risk K-3 Readers. In general, a school must meet  
the conditions of each building-based criteria for two out of the three most recent school years  
for which data may be used. Due to “safe harbor” provisions associated with the transition to  
new state tests, schools were designated for the upcoming school year based on performance  
on the report cards for the 2013-2014, 2017-2018, and 2018-2019 school years. The other two  
criteria are district-based, such as if a school’s district is subject to an academic distress  
commission. The Performance criteria, which considers a school’s grades on the Performance  
Index and Overall Value-Added measures, accounted for the largest increase in designations, as  
shown in the chart below. About 31% of schools have been designated for FY 2021 due to the  
Performance criteria, compared to 5% for FY 2020. A larger number of schools were also  
designated under the Improving At-Risk K-3 Readers criteria, which measures how well schools  
perform at improving the reading skills of grades K-3 students who are not on track for reading  
proficiency by the end of the third grade.  
Chart 5: Percentage of Public Schools Meeting Building-Based Designation Criteria  
for EdChoice Scholarship Program, FY 2020-FY 2021  
3
3
2
2
1
1
5%  
0%  
5%  
0%  
5%  
0%  
31%  
FY 2020  
FY 2021  
18%  
11%  
10%  
10%  
5%  
5
%
%
3%  
2%  
0
Performance  
Improving At-Risk K-3  
Readers  
Lowest 10% in PI  
Graduation  
Budget Footnotes  
P a g e | 25  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
For FY 2020, about 29,500 students have received a performance-based EdChoice  
scholarship, increased from about 23,000 scholarship recipients in FY 2019 due in part to the  
growth in the number of buildings designated. Currently, ODE may award a maximum of 60,000  
performance-based scholarships per year. The scholarships are financed by transfers of state  
foundation aid from the scholarship recipient’s resident school district to the educating school.  
The amount of the scholarship is the lesser of the student’s tuition and $4,650 if the student is  
in grades K-8 or $6,000 if the student is in grades 9-12. In line with the program’s participation  
growth, the amount transferred from school districts’ foundation aid is slated to increase from  
$
the number of students awarded scholarships for the upcoming school year. The application  
window for FY 2021 EdChoice scholarships opens February 1, 2020.  
113.5 million for FY 2019 to $148.2 million for FY 2020. Deductions in FY 2021 will depend on  
Controlling Board Approves $20.6 million for Choose Ohio First  
Scholarships in Computer Science and Related Fields  
Edward Millane, Senior Budget Analyst  
On December 2, 2019, the Controlling Board approved a request from the Department  
of Higher Education (DHE) to award approximately $20.6 million in scholarships to support  
students enrolled in computer science and related programs at 35 public and private  
institutions of higher education across the state through the Choose Ohio First Scholarship  
program. The 35 institutions were selected for awards through a competitive grant process  
based on their recruitment and retention plans. Awards ranged from $64,000 for Rhodes State  
College to $3.0 million for the University of Dayton. Recipient institutions will distribute  
scholarships to their students. DHE estimates that approximately 1,400 students enrolled in  
computer science or related fields will receive scholarships from the new award.  
Since 2008, the Choose Ohio First Scholarship program has provided scholarships to  
students pursuing STEMM or STEMM education degrees at one of Ohio’s institutions of higher  
education. The program also provides scholarships to medical and advanced practice nursing  
students through the Primary Care Medical Student component of the program, consisting of  
Patient Centered Medical Home (PCMH) Medical and PCMH Nursing scholarships. Subject to  
certain exceptions, the annual Choose Ohio First scholarship for an undergraduate or graduate  
student must be at least $1,500 but no more than one-half of the highest in-state  
undergraduate instructional and general fees charged by all state universities ($7,955 for the  
2
019-2020 academic year). H.B. 166 expands the program by qualifying students enrolled in an  
approved certificate program in the STEMM and dentistry fields at a state university or the  
Northeast Ohio Medical University (NEOMED) for a scholarship. Scholarship recipients in  
certificate programs receive an annual amount of at least $500, but no more than one-half of  
the highest in-state undergraduate and general fees charged by all state universities. Overall,  
H.B. 166 appropriates $28.2 million in FY 2020 and $40.2 million in FY 2021 to support Choose  
Ohio First scholarships of all types.  
Budget Footnotes  
P a g e | 26  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
Ohio – Ready, Test, Drive! Program to Expand Statewide  
Maggie West, Senior Budget Analyst  
On November 21, 2019, Governor DeWine announced the statewide expansion of  
Ohio – Ready, Test, Drive!, a virtual driver assessment program that uses portable driving  
simulators to test student drivers’ ability to respond to routine traffic situations, as well as  
road hazards, pedestrian activity, and moving and stationary emergency vehicles. All  
applicants for an initial driver’s license, regardless of age or experience, will be required to  
complete the virtual driver assessment prior to the administration of the on-road driving  
examination. The results of the assessment, regardless of whether the applicant passed or  
failed the on-road examination, will be used to ascertain the effectiveness of current driver  
training programs and to identify areas where improvement is needed.  
Ohio – Ready, Test, Drive! began as a pilot program in July 2017, with virtual driver  
assessment systems installed in five Bureau of Motor Vehicle driver examination locations  
located in Columbus (three locations), Zanesville, and Springfield. During the pilot program,  
which ended in September 2019, the participating driver examination locations  
administered a total of 40,000 virtual driver assessments in which data was collected. That  
data revealed that the virtual driver assessment was able to accurately detect  
underprepared applicants and determine, with 80% accuracy, whether an applicant was  
likely to pass or fail the on-road examination. Once implemented statewide, the program  
will consist of 400 virtual driving assessment systems, which will be installed in each of  
Ohio’s 57 driver examination locations, as well as in 350 of the state’s 523 driver training  
schools.  
DNR Provides $10.2 million to Restore Lake Erie Wetlands  
Under the H2Ohio Water Quality Initiative  
Tom Wert, Senior Budget Analyst  
On November 21, 2019, the Department of Natural Resources (DNR) announced details of  
six wetland restoration projects totaling $10.2 million that will improve water quality in Lake Erie as  
part of the state’s H2Ohio initiative. DNR will use this money to partner with local organizations to  
undertake four wetland projects in Lucas County and one each in Paulding and Sandusky counties,  
as shown in the table below. These projects will restore fish and wildlife habitat, trap sediment, and  
reduce the volume of phosphorus runoff and other pollutants entering Lake Erie.  
Budget Footnotes  
P a g e | 27  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
H2Ohio Wetland Restoration Projects  
Restored  
County  
Project  
Partners  
H2Ohio Funding  
Wetland Acres  
Lucas County Port  
Authority  
City of Toledo  
Cullen Park Wetland  
Restoration  
110  
$5,088,000  
Lucas County Port  
Authority  
City of Toledo  
Grassy Island Wetland  
Restoration  
75  
$742,000  
Lucas  
Maumee Bay State  
Park Wetland  
The Nature  
Conservancy  
1
30  
30  
25  
5
$2,000,000  
$867,000  
$976,000  
Oak Openings  
Preserve Expansion  
Metroparks Toledo  
Sandusky – Redhorse  
Bend  
Black Swamp  
Conservancy  
Sandusky  
Paulding  
Black Swamp  
Conservancy  
Forder Bridge  
$513,000  
Total  
375  
$10,186,000  
The money for these projects comes from the H2Ohio Fund (Fund 6H20) created by  
H.B. 166. Fund 6H2O was capitalized by a transfer of $172.0 million from FY 2019 GRF surplus  
revenue. In all, H.B. 166 appropriated $85.2 million in FY 2020 under the budgets of the  
Department of Natural Resources ($46.2 million), Agriculture ($30.3 million), and the  
Environmental Protection Agency ($8.7 million) to support projects and programs that improve  
water quality throughout the state.  
Controlling Board Approves Ohio Latino Affairs Appropriation  
Increase to Fund Latino Mental Health Navigator Project  
Shaina Morris, Budget Analyst  
On November 4, 2019, the Controlling Board approved an appropriation increase for the  
Ohio Commission on Hispanic/Latino Affairs (OCHLA). OCHLA requested an increase of  
$
FY 2020 to administer and finance the Latino Mental Health Navigator Project. Under an  
interagency agreement, the Ohio Department of Mental Health and Addiction Services  
150,000 in the amount appropriated from the Gifts and Miscellaneous Fund (Fund 6010) in  
(
Block Grant. OCHLA is required to collaborate with OhioMHAS to identify necessary baseline  
and program data, and to collect and report such data to OhioMHAS to evaluate outcomes of  
OhioMHAS) is transferring the necessary funding from its federal Community Mental Health  
Budget Footnotes  
P a g e | 28  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
the funded projects. OCHLA is not required to provide matching funds and plans to allocate up  
to 10% for related operating expenses.  
OCHLA’s Latino Mental Health Navigator Project is intended to reduce disparities in  
availability, accessibility, and quality of behavioral healthcare services for the Hispanic-Latino  
community. Two grants of $65,000 each will be awarded to projects that identify and target  
structural barriers, promote engagement in behavioral healthcare, and facilitate navigation of  
systems of care in Central and Southwest Ohio. Eligible applicants include county alcohol, drug  
addiction, and mental health services (ADAMHS) boards and area agencies working in  
collaboration with ADAMHS boards in Central and Southwest Ohio, including nonprofits.  
Budget Footnotes  
P a g e | 29  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
TErric Maakcelak, Eiconnomgist the Economy  
Overview  
The nation’s economy continues to expand. The U.S. economy added 145,000 nonfarm  
payroll jobs in December, and the monthly national unemployment rate remained level at  
.5%. The seasonally adjusted rate of inflation adjusted gross domestic product (real GDP)  
3
growth was estimated to be 2.1% in the third quarter of 2019. Price levels, as measured by  
the Consumer Price Index (CPI), increased by 0.3% in November after rising 0.4% in October.  
Total industrial production rose in November, after declines earlier in the year, and was 0.8%  
below a year earlier.  
Nonfarm payroll employment in Ohio increased by 6,700 in November; the state’s  
unemployment rate for the month was unchanged at 4.2%. Ohio’s economy, measured by real  
GDP, grew at a rate of 1.7% in the third quarter of 2019, according to the most recent statistics.  
The personal income of Ohioans grew at a 4.4% annualized rate in the third quarter of 2019,  
second fastest among states in the Great Lakes region. The state’s population increased by an  
estimated 12,800 persons from July 2018 to July 2019.  
The National Economy  
The U.S. economy added 145,000 nonfarm payroll workers in December, and the  
national unemployment remained at a seasonally adjusted 3.5%. In December 2018, the  
national unemployment rate was 3.9%.17 The labor force participation rate was 63.2% last  
month; a year ago the labor force participation rate was 63.0% nationally. Approximately  
1
58.8 million persons were employed in December 2019, up from 156.8 million persons a  
year prior.  
Among the nonfarm payroll jobs added in December, the most notable gains were in the  
industries of retail trade (+41,000) and health care (+28,000). Seasonally adjusted employment  
in leisure and hospitality (+40,000) and professional and business services (+10,000) was up in  
December, with those industries each adding over 350,000 jobs during 2019. In January, the  
U.S. Census Bureau announced its recruiting effort to hire up to 500,000 temporary, part-time  
employees as part of its Census 2020 effort. Chart 6 shows U.S. employment and  
unemployment.  
17 The most recent Bureau of Labor Statistics release of national unemployment data included a  
routine adjustment of the seasonal factors used in calculating seasonally adjusted unemployment rates,  
and a revision of monthly national unemployment data for the previous five years. As a result of this  
update, there were no changes to estimated national unemployment rates from January 2019 to  
November 2019.  
Budget Footnotes  
P a g e | 30  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
Chart 6: U.S. Employment and Unemployment  
155  
152  
149  
146  
143  
140  
137  
134  
131  
128  
12.0%  
11.0%  
10.0%  
9.0%  
8.0%  
7.0%  
6.0%  
5.0%  
4.0%  
3.0%  
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019  
Nonfarm Payroll Employment  
Unemployment Rate (right scale)  
Employment and unemployment data are derived from the Current Employment  
Statistics (CES) and Current Population Survey (CPS) programs. According to the Bureau of  
Labor Statistics (BLS), the CES program surveys approximately 142,000 businesses and  
1
8
government agencies which own or manage around 689,000 nonfarm establishments. The  
establishment survey provides information on employment, hours, and earnings of employees  
on nonfarm payrolls. The CPS, or household survey, is a monthly survey of approximately  
6
0,000 households and provides information on the employment, unemployment, and general  
labor market participation of individuals. Two different employment estimates are generated  
using the two surveys, and the two estimates sometimes point in different directions: the  
November data show an 8,000 decrease in household employment and a 265,000 increase in  
payroll employment. Similar differences sometimes occur in the Ohio data.  
Because the CES sample is of a fixed number of establishments, the data do not  
immediately reflect changes in the U.S. business environment. To correct for this issue, the data  
are adjusted on an annual basis utilizing a nearly complete employment record, the Quarterly  
Census of Employment and Wages (QCEW), as well as other sources. The QCEW is a series of  
quarterly data collected via state unemployment insurance (UI) rolls. The QCEW also is a source  
of data on the number of business closings and openings. Economists at BLS utilize the QCEW to  
adjust CES employment data once annually to account for changes in the industrial mix due to  
employment at new establishments. The annual benchmarking of employment data is due to  
be released in February 2020; from 2008 to 2018, revisions to total nonfarm payroll  
employment estimates have not exceeded 902,000 (in 2009).  
Nationally, real GDP increased at a seasonally adjusted annual rate of 2.1% in the third  
quarter of 2019, according to the third Bureau of Economic Analysis estimate. Consumer  
spending on goods increased at a 5.3% annual rate, while consumption of services increased at  
18 https://www.bls.gov/bls/empsitquickguide.htm.  
Budget Footnotes  
P a g e | 31  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
a 2.2% rate. Nonresidential fixed investment fell for the second straight quarter, although this  
decrease was partially offset by an increase in the rate of residential fixed investment.  
Government spending increased, at both the federal and the state and local levels, however  
growth slowed from the previous quarter. Real disposable personal income increased by a  
seasonally adjusted 0.4% in November. 19  
Inflation is measured by the CPI and other indexes. The CPI increased by 0.3% from  
October to November. Excluding the more volatile food and energy services and commodities,  
the CPI was up 0.2% in that time. The CPI price index for medical care services, not adjusted for  
seasonality, increased by 0.4%, the fifteenth straight month of increase. The price indexes for  
new and used vehicles were changed by -0.1% and 0.6%, respectively. The price indexes for  
services and shelter both increased by 0.3% during the month.  
According to the Federal Reserve Board’s (FRB) Industrial Production Index (IPI),  
industrial production was up 1.1% nationally from October to November. The IPI for the  
manufacturing industry is down by 0.8% between November 2018 and November 2019, while  
indexes for the mining and utilities industries changed by 2.0% and -4.1% respectively,  
year-over-year. According to the Institute for Supply Management, manufacturing activity  
decreased in December. Production, new manufacturing orders, and employment were lower  
among surveyed firms; prices increased in December after decreasing in November.  
The number of privately owned housing unit construction permits issued in November  
increased by 1.4% from October. The rate of new residential construction authorized by  
permits was 11.1% greater in November than the rate of permit issuance a year prior.20 The  
rate of new residential construction started was 13.6% greater in November than the rate of  
construction starts a year prior.  
The Ohio Economy  
In November, nonfarm payroll employment increased by approximately 6,700 and the  
state unemployment rate remained at 4.2%. The seasonally adjusted total monthly change in  
employment reflects an increase of around 7,000 workers in the service sector and a  
decrease of around 300 workers in the goods producing sector. The number of workers  
employed in the wholesale trade industry decreased by around 600 in November, while the  
number of workers employed in the retail trade industry decreased by around 500. The  
leisure and hospitality industry added approximately 2,200 Ohioans to their payroll numbers  
during the month.  
The number of unemployed persons in Ohio increased by approximately 1,100 in  
November, following a rise of around 3,200 in October. The number of labor force participants  
grew by around 3,100 in November. There were approximately 77,300 more Ohioans in the  
labor force this November than in November 2018. Chart 7 shows Ohio employment and  
unemployment.  
19 Personal income is defined by the BEA as income from the following sources: labor income,  
proprietors’ income, rental income of persons, interest and dividend income, and transfers from  
government or businesses minus social program taxes such as Social Security and Medicare.  
20 https://www.census.gov/construction/nrc/index.html.  
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January 2020  
Legislative Budget Office of the Legislative Service Commission  
Ohio’s economy, measured by the state’s real GDP, grew at a seasonally adjusted 1.7%  
annual rate in the third quarter, following growth at a 1.3% rate in the second quarter of 2019  
th  
and 2.3% growth in the first quarter. Third quarter growth in the state ranked 36 nationally. In  
Ohio, mining, quarrying, and oil and gas extraction accounted for more of the state’s growth  
than in other states in the region; the contribution of most other industries was approximately  
around the average for the region. Seasonally adjusted annual growth in the finance and  
insurance industry subtracted from gross state product growth in every state in the nation.  
Chart 7: Ohio Employment and Unemployment  
5.7  
5.6  
5.5  
5.4  
5.3  
5.2  
5.1  
5.0  
4.9  
12.0%  
11.0%  
10.0%  
9.0%  
8.0%  
7.0%  
6.0%  
5.0%  
4.0%  
3.0%  
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019  
Nonfarm Payroll Employment Unemployment Rate (right scale)  
The personal income of Ohioans grew at a 4.4% seasonally adjusted annualized rate in  
th  
the third quarter of 2019, ranking 12 among states. Net earnings, the sum of worker  
compensation and proprietors’ income less social insurance taxes, increased at a 5.3% annual  
rate in the third quarter of 2019. Dividends, interest, and rental income decreased at a  
seasonally adjusted annualized rate of 1.0% over the quarter. Transfer income increased at a  
6
.3% annual rate, the second fastest growth for this category in the nation.  
According to the Ohio Associate of Realtors, the number of housing units sold in Ohio in  
November 2019 decreased by 1.4% from November 2018. YTD, the average sale price of homes  
in 2019 has been 6.0% greater than in 2018, while the total dollar volume of home sales is up  
6
.4% in 2019 compared with a year prior.  
According to the most recent population estimates released by the U.S. Census Bureau,  
Ohio’s resident population increased by approximately 12,800 persons from July 2018 to July  
2
measured by the number of births minus the number of deaths, was approximately 16,500  
during this time period. The birth rate during the time frame was approximately 11.5 births per  
019, reaching 11.7 million or 3.6% of nationwide residents.21 Natural population growth,  
1
,000 Ohio residents; there were approximately 10.1 deaths per 1,000 residents. By  
21 https://www.census.gov/data/datasets/time-series/demo/popest/2010s-state-total.html.  
Budget Footnotes  
P a g e | 33  
January 2020  
Legislative Budget Office of the Legislative Service Commission  
comparison, the national birth rate was 11.6 per 1,000 residents and 8.7 deaths per 1,000  
residents. Net migration of Ohio residents was -3,400 from 2018 to 2019.22 Domestic net  
migration, movement of persons within national boundaries, was largely negative in Ohio  
during this time frame; from July 2018 to July 2019, more persons moved from Ohio to other  
states than moved from other states to Ohio. International migration, movement of persons  
outside national boundaries, was positive, meaning Ohio is a net recipient of international  
migrants.  
22 Net migration is the estimated number of persons moving to Ohio minus the number of  
persons moving from Ohio to a location outside the state.  
Budget Footnotes  
P a g e | 34  
January 2020