COLUMBUS — Caught between a fiscal crisis and a mandate to fix school funding, state agency leaders are scurrying to shield programs and staff from a falling budget ax.

        Ohio's worsening economy threatens to subtract $562 million from Gov. Bob Taft's two-year, $44.8 billion budget plan. At the same time, lawmakers figure to spend up to $600 million more than Mr. Taft has proposed to meet an Ohio Supreme Court order to narrow the gap between rich and poor schools.

        With no plans to raise taxes, drastic budget cuts are now a threat to any agency or program that once expected to get more money. Now agency finance officers are looking to see what can be saved and what will be lost.

        “I don't sleep much at night. I spend a lot of time here,” said Sven Lindberg, fiscal director at the Department of Mental Retardation and Developmental Disabilities.

        As much as $34.5 million could be at risk, Mr. Lindberg said. The money would pay for waivers for group home residents and staff training, and would help hire new county case workers.

        Mr. Lindberg has lots of company. The departments of Education, Development, Administrative Services and the Board of Regents also could lose money.

        Even Ohio's bicentennial celebration is threatened.

        The Ohio Bicentennial Commission hoped to spend $30 million over the next two years to help celebrate the state's 200th birthday. Spokesman Fred Stratmann said commission officials are worried they will lose the money.

        “There are a lot of interest groups pointing to (the commission) and saying, "You're cutting us but not them?'” Mr. Stratmann said.

        At the core of this crisis is a state economy that has stalled, sending state government income and sales tax revenue plummeting.

        “We have not seen something like this happen since the recession of 1991,” said Donald Berno, leader of the Ohio Public Expenditures Council, a nonpartisan group that examines the state's fiscal policy and practices.

        One major complicating factor is an Ohio Supreme Court decision that declared the state's school funding system unconstitutional. Lawmakers have until June 15 to craft a plan that eliminates local property taxes as schools' main source of funds.

        Mr. Taft originally proposed an $808 million, two-year increase for schools as part of his budget. In recent weeks, lawmakers and the governor have discussed options that would spend between $900 million and $1.4 billion.

        Factoring in the projected $562 million shortfall, lawmakers must find $700 million to more than $1 billion. Much of that could come from other places in the budget.

        Though the Department of Education would supply the extra money for schools, Senate President Richard Finan, an Evendale Republican, indicated some cuts to nonessential staff and programs could help find some of the needed money.

        “There will be cuts in that department, I'm sure,” Mr. Finan said.

        At the Board of Regents, $176 million in planned funding increases for higher education programs may be on the block. The money would help universities tailor training classes for businesses, attract research grants, help hold tuition costs down and encourage universities to serve at-risk students.

        Officials at the Board of Regents declined to speculate on what might be cut, saying it's too soon to tell.

        One thing is clear, hard choices on specific cuts must be made within the next two months so that Mr. Taft and lawmakers can meet the high court's deadline.

        “Everything is going to be on the table, as far as what we look at, to balance this budget,” Mr. Finan said. “There's going to be cuts.”

        Travis James Tritten contributed to this report.

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