COLUMBUS — For the first time since Gov. John Kasich took office, the Ohio House approved a proposed two-year state budget today that provides for no broad tax cuts.
State tax collections have trailed expectations for a year and the spending plan that now crosses the capitol rotunda to the Senate still falls short of the agreement Mr. Kasich reached with GOP leaders in recent weeks to cut $800 million from his own original proposal.
The plan entirely abandons the governor’s plan to trade higher taxes on sales, tobacco, alcohol, and shale oil and natural gas production for a net personal income tax cut.
The House, however, did carve out a couple of tax breaks, exempting prescription eyewear and digital jukebox and arcade game plays from sales taxes.
The plan also reduces the state’s personal income tax brackets from nine to seven, eliminating the bottom two brackets but having no impact on individual tax bills.
“The business community basically came to us and said we appreciate all the progress we’ve made over the last few budgets,” said Rep. Ryan Smith (R., Bidwell), chairman of the House Finance Committee. “We’re very cognizant of where we’re at, but in this budget we appreciate consistency.
“Stability in business is paramount to plan, and they felt like the best thing we could do is as little as possible as far as moving things around in this budget,” he said.
Democrats, however, argued that the state is paying the price now for past tax cuts that didn’t yield the high-paying jobs that were promised.
“Yes, the tax shifting has ended in this budget for the most part,” said Rep. Jack Cera (D., Bellaire), Finance’s ranking Democrat. “But really that’s because the revenue is not there for additional tax cuts.”
House Bill 49 passed the chamber by a vote of 58-37.
Four Democrats, including Rep. Mike Sheehy (D., Oregon) in northwest Ohio, broke ranks to join most Republicans in support of the plan. Meanwhile, 11 Republicans voted “no,” including the region’s Reps. Wes Goodman (R., Cardington), and Craig Riedel (R., Defiance).
Despite continued opposition from some Republican conservatives, the plan preserves Mr. Kasich’s controversial expansion of Medicaid health coverage. The endangered federal Affordable Care Act currently funds 95 percent of the cost, but that will drop to 90 percent in 2020.
But Republicans added a provision requiring the state to ask the Trump administration for approval to impose work requirements on the roughly 715,000 Ohioans on the expansion rolls. It provides exceptions for those over 55, considered medically fragile, in school, in job training, or in substance abuse treatment.
The bill also requires the state to get approval every six months from the Ohio Controlling Board, a quasi-legislative budgetary panel, to spend the state’s share of the expansion costs. Republicans added that provision to keep pressure on the Kasich administration in pursuing the federal work waiver.
House Bill 49 does add $170.6 million over the next two years to battle the state’s opiate painkiller and heroin addiction amendment. Mr. Ryan challenged Democrats for voting against the budget that provides this funding.
“This doesn’t need to be about politics,” he said. “This has to be about policy. This has to be about people....Understand, if you vote no, you’re voting against $200 million to try to stave off an epidemic that (leads to) 4,000, maybe 5,000 deaths in Ohio (this year).”
Democrats tried unsuccessfully to earmark another $200 million toward the epidemic using money from Mr. Kasich’s JobsOhio job-creation entity. They also voiced support for using some of the state’s $2 billion budgetary reserves for that purpose.
Contact Jim Provance at: jprovance@theblade.com or 614-221-0496.
First Published May 2, 2017, 7:08 p.m.
