The Ohio House has approved its version of the state budget that overhauls the governor's tax plans, steers more money to schools and revises certain health care policies. It contains a 6.3 percent income tax cut beginning in 2015. That would lower the top rate to just below 5 percent. Majority Republicans stripped increases on certain business and sales taxes used to help fund an income tax cut. The measure now goes to the GOP-dominated Senate. Ohio Public Radio's Andy Chow reports.
The two-year budget bill that tops $71 billion looks a lot different than the original proposal from Governor John Kasich. There’s still an income tax cut - though at 6.3%, it’s smaller than the 23% cut in Kasich’s budget - and there are still tax breaks for small businesses. But proposed tax increases on cigarettes, oil and gas drilling, commercial activity and sales were all left on the cutting room floor.
Republican Representative and House Finance Committee Chair Ryan Smith of Gallipolis says the House put a lot of work and thought into their changes, especially the school funding portion, which added another $270 million to what the governor proposed. Smith believes this will give a major boost to struggling schools.
“I think that you’re going to see districts that maybe only offered one foreign language or didn’t have any advanced placement courses now will have the opportunity to do that,” Smith said.
When the governor unveiled his budget plan it included the controversial piece that sent a rift down party lines two years ago—Medicaid expansion. Last time Kasich had to go through a smaller legislative panel to get support for the expansion. This time—however—it seemed like House Republican leaders were ready to play ball. But there were still some representatives in the Republican caucus who were bothered by the expansion—which they relate back to the Affordable Care Act also known as ObamaCare.
That includes Republican Representative Nino Vitale of Urbana, who liked several parts of the budget but believed Medicaid expansion puts the federal government further in debt.
“But unfortunately this one thing—this ObamaCare Medicaid expansion is something that puts us in a position that creates the problem and continues the problem instead of us helping the problem,” said Vitale.
Smith says he understands the reservations behind supporting Medicaid expansion but believes the bill’s added provisions to help bring people out of the system create a good balance.
“One side you know we need to give health care to these folks that deserve health care. The other side says we can’t afford to do this and we need to be fiscally minded let’s try to figure out where we can land. I think that by putting the necessary reforms on here it gives us the sustainability into the future to at least have a further discussion on this,” said Smith.
Democratic leaders, including Representative Denise Driehaus of Cincinnati, believe the budget falls short of truly helping all economic classes in Ohio.
“This budget doesn’t work for the middle class when the tax cuts in this budget primarily benefit the wealthy. This budget doesn’t work for small businesses when the tax relief to small businesses isn’t strategic,” Driehaus said.
That was the general tone from House Democrats. Most leaders weren’t overly upset about what was in the bill but what they believed to be lacking, such as expanded access to health care, measures to make college more affordable, and increased funding to local governments.
While two Democrats voted for the budget bill the rest voted against it—joined by a handful of Republicans.
Kasich’s spokesperson Rob Nichols released a statement following the House vote. He said the governor is troubled by the bill which he said increases spending with rosy budget projections. Nichols also said removing Kasich’s tax reform is a missed opportunity.
House Speaker Cliff Rosenberger of Clarksville was asked about the possible changes the Senate could make—such as bringing back the proposed increased tax on oil and gas drilling. The speaker said he respects the process and welcomes further discussion.
“We do this every—it’s like Groundhog Day—budgets come you try to do all this major policy in two or three short months and we’re trying to say ‘hey look we need to extenuate this a little bit, we need to examine some of this stuff a little longer,” said Rosenberger.
The Senate has already started holding informal hearings on the budget.
