by J.D. Davidson
Ohio Lt. Gov. Jon Husted says restrictions in the recently passed federal American Rescue Plan will limit economic development and job growth in the state.
Husted, responding to a federal lawsuit filed by Ohio Attorney General Dave Yost that asks for the plan’s “Tax Mandate” be stopped, said the restrictions could affect the state’s ability to attract jobs with tax credits and other means.
“The precedent Congress is attempting to set here is that anytime the federal government sends money to state and or local governments, they could add strings to control the tax policies of all 50 states. This is both arrogant and unconstitutional,” Husted said in a statement. “At a practical level, this could affect economic competitiveness of the state attempting to attract jobs with job creation tax credits or other tax-based economic incentives.”
Yost said the federal government is holding the state’s American Rescue Plan money hostage, and he filed a request for an injunction in the U.S. District Court of Southern Ohio on Wednesday to bar what he called the enforcement of the “Tax Mandate” to the American Rescue Plan at the last minute.
According to Bethany McCorkle, Yost’s communications director, an informal preliminary telephone conference on the lawsuit is scheduled for 11:30 a.m. March 26 before Judge Douglas R. Cole.
The “Tax Mandate” in the American Rescue Plan forces Ohio, along with every other state, to accept the money with conditions, Yost said. One of the conditions is the funds cannot be used, directly or indirectly, to offset tax cuts or credits.
Yost said the provision exceeds congressional authority.
“The federal government should be encouraging states to innovate and grow business, not holding vital relief funding hostage to its preferred pro-tax policies,” Yost said.
One of the nation’s leading economic development publications recently ranked Ohio No. 1 in its state economic and business attraction rankings for attracting more corporate facility projects per capita than any other state.
Ohio also ranked second for total projects overall.
Site Selection, a corporate real estate economic development magazine, recently announced its rankings as part of its 2020 Governor’s Cup.
“The governor and the Legislature are best prepared, and were elected, to establish the tax and spending decisions for the State of Ohio. (U.S. House Speaker) Nancy Pelosi and (U.S. Senate Majority Leader) Chuck Schumer are not,” Husted said. “I appreciate Attorney General Yost’s efforts to challenge the federal overreach of authority, making it clear that state governments, and not Congress, make the decisions on state tax policy.”
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An Ohio native, J.D. Davidson is a veteran journalist with more than 30 years of experience in newspapers in Ohio, Georgia, Alabama and Texas. He has served as a reporter, editor, managing editor and publisher. He is regional editor for The Center Square.
