Gov. Ted Strickland and state lawmakers already are looking at significant changes to his new school-funding formula, including a higher figure needed to pay for teacher salaries and ways to limit poorer districts' short-term pain.

Some lawmakers worry that Strickland's formula doesn't allocate enough for teachers. Ohio has more than 100,000 teachers, so even a small change in the salary figure could have a huge impact on the money needed in Strickland's formula.

Testifying before the House Finance Committee for the first time since the 3,109-page budget bill was released Tuesday afternoon, state Budget Director J. Pari Sabety said the amount earmarked to cover teacher pay is one of four areas of "anomalous results" in the funding model that the Strickland administration is re-evaluating.

The formula starts with $45,094 per teacher -- what administration officials say is the unweighted average base salary for Ohio teachers. The formula adds 14 percent to cover retirement contributions and then runs that number ($51,407 in 2010) through the formula.

"There is some concern that the teacher salary number has been underfunded," said Rep. Randy Gardner, R-Bowling Green, adding that he has heard from superintendents that Strickland's figure is off by $3,000 to $5,000.

According to Strickland and state education officials, the Ohio Department of Education has a variety of weighted and unweighted teacher salary averages, ranging from $51,000 to $54,200.

Four years ago, then-Gov. Bob Taft's Blue Ribbon Task Force calculated the average, including the retirement benefits, at $58,271 -- $6,864 more than Strickland's number.

If those kinds of numbers are plugged into Strickland's formula instead, his plan could come up hundreds of millions of dollars short.

"We want to make sure the number is as accurate as possible," said Rep. Stephen Dyer, D-Green, chairman of the education subcommittee of the House finance panel. "Obviously that's been one of the concerns voiced."

If there is a better number, the governor is open to discussing it, said Strickland spokeswoman Amanda Wurst.

Strickland's proposal also has come under fire because even though poor rural districts would get more money once the plan is phased in after eight years, many would take a funding cut during the next two years.

Yesterday, Sabety defended the heavy use of one-time money in Strickland's proposed two-year, $54 billion-plus budget, accusing critics of "Monday morning quarterbacking."

Republicans and some outside analysts have cautioned that the use of $7 billion in one-time state and federal money is setting up Ohio for major budget cuts or tax increases in two years.

"Guys, you gotta look at the budget. You've got to look at what we're doing about structural changes," Sabety told reporters after more than two hours of testimony.

The major change is to Medicaid, the federal-state health-care program for the poor.

Federal stimulus money, along with new fees on nursing homes, hospitals and other providers of Medicaid services, will help the state keep up with soaring enrollment and rising costs, the administration says.

For every dollar the state spends on Medicaid, the federal government provides matching funds, with reimbursement rates ranging from 50 percent to 90 percent, depending on the program. Money generated from the new fees will go toward the state's share, "taking pressure off the general revenue fund," Ohio Medicaid Director John Corlett told the committee.

A new hospital franchise fee is expected to generate nearly $600 million over the two years while a similar fee on nursing homes will raise about $285 million, according to administration projections.

Medicaid rolls are expected to increase by 172,000 during the next two years, up from the current caseload of nearly 1.9 million.

Several lawmakers raised concerns about shifting some of the state's share of Medicaid costs to nursing homes and other service providers. They also questioned how the state would make up the $2 billion in one-time federal Medicaid money in the next state budget.

Rep. Clayton Luckie, D-Dayton, asked whether the new fees will, in effect, return to Medicaid service providers, such as through an increased reimbursement rate.

Hospitals will get a rate increase under the governor's proposal, but the fees generally will support the state's share of Medicaid as a whole, Corlett said.

"Other states are cutting provider rates and services," he said. "We aren't doing that. We've tried to protect the integrity of the program."

jsiegel@dispatch.com

ccandisky@dispatch.com