Ohio Governor Urges Treasury to Support Economic Growth Legislation

[1] I am writing to reiterate my belief that Congress and the Administration should enact legislation to spur economic growth, and do so as quickly as possible. This legislation must also include provisions that will respond to the immediate needs of workers who have lost jobs and health benefits during the present economic slowdown.

[2] Ohio employers large and small are laying off workers. Economic conditions have forced one of our largest firms, LTV Corporation, to cease production, jeopardizing 3,200 jobs in Northeast Ohio. Similar conditions are imposing considerable hardships on communities throughout the State. I am prepared to employ all tools at my disposal to ease the human toll, but federal leadership and resources clearly are needed as well.

[3] I am encouraged that ongoing Stimulus Package negotiations appear to be yielding consensus on the need to provide at least 13 additional weeks of extended unemployment benefits to dislocated workers. Both an increase in FMAP Medicaid matching payments for states and a sizable distribution of Reed Act funds to states for benefits and program administration are appropriate as well. Medicaid rolls are up dramatically nationwide, and the Reed Act funding is collected from employers for use in precisely this type of economic environment. Both the onetime FMAP boost and the Reed Act distribution would inject much-needed disposable income to Ohio households.

[4] I also applaud efforts to stimulate private capital investment, but would remind you to urge negotiators to restructure pending depreciation and related proposals in such a way that they would not cause direct revenue losses to states. States simply cannot absorb additional losses of revenue. I recently slashed state agency budgets, and took other financial measures, to meet a projected biennial shortfall of $1.5 billion. American industry should be encouraged to invest in new equipment as a useful precursor for new hiring. But investment incentives should be provided in the form of federal tax credits to forestall unintended adverse impacts on strapped state budgets.

[5] I appreciate your attention to my concerns as we work to stimulate our economy.

Sincerely,