The Ohio Senate is set to vote on its version of the state’s two-year, $75 billion budget.
The main items in the Senate’s budget plan, which is similar to the budget on which the Ohio House voted in April, are an income tax cut, along with increased school funding.
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A state senator from Toledo is blasting Gov. Mike DeWine’s decision to cut funding to public schools as part of a move to reduce spending amid the COVID-19 pandemic.
“Governor DeWine’s decision to slash more than $300 million from Ohio’s K-12 funding is an alarming divestment from our public school system during a time when schools need more support than ever,” state Sen. Teresa Fedor, D-Toledo, said in a statement. “Nearly half of the $775 million total in cuts to General Revenue spending will be stripped from Ohio’s public schools, which continue to serve more than 90% of children in our state.
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by Tyler Arnold Ohio Senate Republicans expect a budget bill compromise to be reached for a vote by Wednesday’s deadline, according to spokesperson John Fortney. “We are very close, and we expect the budget to be ready for a vote before the interim period ends,” Fortney told The Center Square via email. Republicans currently hold the leadership in both chambers of the state legislature, but feuds over what should be done with the budget surplus funds caused the legislature to miss a July 1 budget deadline. The two sides pushed through a temporary spending bill to keep the government open until Wednesday (July 17) so they could have more time to craft a bill that both chambers could support. The specifics surrounding this potential compromise have yet to be released, but both chambers previously passed bills that cut the state’s personal income tax and increased spending for environmental and educational wrap-around programs. One of the main points of contention between House and Senate leadership has been the small business tax credit. Gov. Mike DeWine and Senate Republicans want to maintain the current credit, but House Republicans want to scale it back. Current law provides a tax exemption on 75…
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by Tyler Arnold Formal discussions between the House and the Senate regarding a budget agreement are expected to begin Wednesday. House Majority Leader Bill Seitz, R-Cincinnati, told The Center Square via email that some informal discussion are already underway. Although both chambers have a Republican majority and successfully passed bipartisan bills, the plans differed from each other on some specifics regarding healthcare transparency, tax cuts, a film industry tax credit and education spending. “I think we’re going to work well together and I fully expect a quality bill that is satisfying to both chambers and the governor,” Senate President Larry Obhof, R-Medina, told reporters. On healthcare, the House version includes a plan called “Healthy Ohio,” which calls for a controversial provision on price transparency. The transparency provision would require hospitals to give patients cost estimates on non-emergency procedures and products. Although supporters argued that this would reduce costs, the Senate pulled it out of its budget proposal after backlash from the medical industry. Although both chambers pushed tax cuts, the Senate version has larger cuts to the personal income tax than the House. The Senate plan would also maintain the current threshold for the small business tax credit, which…
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State Sen. Lou Terhar (R-Cincinnati) said it would be “a mistake” for the Ohio Senate to support a decrease to the tax breaks small businesses receive in the state. “There are a range of issues with the House budget that concern us in the Senate. The first would be the cut of the small business tax, which we believe is a mistake,” Terhar said. “Once we take a position on how small businesses should be treated, we should stick with that position,” he added. Terhar said that if “you’re going to encourage small businesses” by giving them a tax cut “and then take that away,” it will make business owners wonder if they “really want to invest in Ohio.” Under the House’s version of the budget bill, Ohio’s Business Investment Income Deduction would be lowered to $100,000. As of now, small businesses don’t pay taxes on the first $250,000 of income, but that figure would drop down to $100,000 under House Bill 166. Terhar’s comments came during a recent forum on the state budget hosted by Ohio’s Future Foundation and its chairman, former Congressman Jim Renacci. “One of the concerns is we still do not have a state that’s…
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by Todd Defeo State senators debating the biennial budget could soon consider proposals to increase funding for direct service professionals, food banks and public schools throughout the state. Earlier this month, the Ohio House voted 85-9 to approve House Bill 166, a nearly $68.9 billion, two-year state spending plan. Senate Democrats, in particular, seized the opportunity this week to outline many of their desired changes to the spending bill. The spending plan removes the income tax for Ohioans who earn less than $22,250 per year and reduces income tax rates by 6.6 percent for the remainder of Ohio’s residents. It also includes a pay increase for direct service providers, eliminates a corporate jet timeshare tax exemption and increases the minimum age to buy tobacco in the state from 18 to 21 years old. “We, obviously, have some bipartisan agreement on a lot of concerns,” state Sen. Cecil Thomas, D-Cincinnati, said during a Senate Finance Committee meeting. Among the amendments state senators could consider is one that centers on how to enforce the proposed increase of the age to buy cigarettes. A change could focus on punishing retailers that sell to underage buyers rather than the purchasers, state Sen. Bob…
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The Ohio Senate Finance Subcommittee on Primary and Secondary Education was asked to reconsider spending an additional $550 million on public education in the state’s biennial budget, House Bill 166. Testifying before the committee Wednesday, Greg Lawson, a senior research fellow at The Buckeye Institute, pointed out that “Ohio’s spending on K-12 public education has grown faster than inflation even as Ohio’s achievement gap between African American and white students remains stubbornly high.” “Spending more state money on education has not proven a viable solution to this persistent problem,” Lawson argued. However, as Lawson reveals, House Bill 166 does just that. Over the course of Fiscal Year 2020 and Fiscal Year 2021, the budget proposes spending an additional $550 million on primary and secondary education. “Even though Ohio ranks among the top 10 states with the largest projected enrollment declines over the rest of the decade according to the National Center for Education Statistics,” he added. “More concerning still is that more state funds will be spent just as Ohio considers watering down state report cards, reducing accountability by eliminating academic distress commissions, and weakening graduation requirements,” he continued. While the controversial academic distress commissions have flaws, Lawson does…
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The Buckeye Institute, an Ohio-based conservative think tank, warned lawmakers Tuesday that state government spending “has outpaced inflation and population growth for years,” meaning the “day of reckoning will be painful for families and businesses” if they don’t cut down on spending. Greg Lawson, a research fellow at The Buckeye Institute, testified before the Ohio House Finance Committee on House Bill 166, the House version of the state’s biennial budget. Lawson began his testimony by noting that the budget decisions arrive “during an economic expansion of historic duration.” In fact, if current economic growth continues until July, it will be “the longest economic expansion in U.S. history.” “Now is the time to pursue meaningful, sustainable reform and take full advantage of this biennial opportunity to make Ohio more prosperous, while avoiding missteps that could lead to a disastrous recession,” Lawson said, suggesting changes to the proposed budget in the areas of government spending, public education, Medicaid, and taxes. He argued that “spending ever-greater sums of taxpayer dollars every fiscal year establishes higher budget baselines that make economic downturns more painful and policy choices more difficult.” “Setting those higher baselines forces future policymakers to choose between painfully increasing taxes during…
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A revised state budget proposal unveiled Thursday by House Republican leadership would introduce substantial income tax cuts for Ohioans but would do so by eliminating tax breaks for small businesses. The budget plan, House Bill 166, builds off of the budget proposal put forward by Gov. Mike DeWine, who said Friday that the bill sticks to the “essential principles” of his proposal. Under the proposal, Ohio’s lowest tax brackets would be completely eliminated, such that earners who make $22,250 or less annually wouldn’t pay any state income taxes. The state’s middle two brackets would also see significant reductions in income taxes. But these income tax reductions would be partially paid for by cutting down on the state’s small business tax deduction. Currently, small businesses don’t pay taxes on the first $250,000 of income, but that would be lowered to $100,000 under the new budget proposal. “We shouldn’t try to pick winners and losers. What we should try to do is set a balanced field out there and let people compete in business,” House Speaker Larry Householder (R-Glenford) said when unveiling the proposal. The Buckeye Institute, an Ohio-based conservative think tank, believes that Republicans are making a mistake in not…
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An expert analyst suggested that the revenue forecast in Gov. Mike DeWine’s budget proposal is $705 million too high during a testimony before the House Finance Committee Tuesday. According to Legislative Service Commission Director Mark Flanders, DeWine’s General Revenue Fund (GRF) tax revenue forecasts would come up $704.9 million short across the next three fiscal years. “Legislative Budget Office economists forecast somewhat lower baseline GRF tax revenues for the current fiscal year and the next biennium than are forecast for the executive budget,” Flanders said in his testimony. Specifically, Flanders said his economists came up with predictions that are $196.7 million lower than DeWine’s in Fiscal Year 2019, $347.3 million lower in Fiscal Year 2020, and $160.9 million lower in Fiscal Year 2021. “The outlook for state government revenues is greatly influenced by the course of Ohio’s economy and the economy of the nation. U.S. economic expansion was strong through much of last year, but recent economic indicators have been mixed,” Flanders said. But Kim Murnieks, director of the Office of Budget and Management, claimed Tuesday that the forecasts in DeWine’s budget are are “conservatively forecast.” “As we introduce this budget, the state is in strong fiscal condition, about to…
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