COLUMBUS, Ohio — The Ohio Republicans passed a $60 billion operating budget, which includes tax cuts for the wealthy, funding for a new Cleveland Browns stadium and restrictions on education. The GOP says it is a fiscally conservative and responsible budget. The Democrats say it is a budget for billionaires — not the working-class Ohioans.
In the dead of night, the Republicans on the Conference Committee approved a final budget. But while Ohioans were sleeping at 1 a.m. Wednesday morning — we were there. We only got the information less than an hour before the full Senate and House floor votes on Wednesday afternoon — the same as the Democrats. Even Republicans didn't get the full language, many told us.
"Take care of all the major programs I think Ohioans expect us to do," House Finance Chair Brian Stewart (R-Ashville) said.
However, this was the first budget bill to not get a single Democratic vote since 2001.
"I cannot tell the people of Ohio that this is a budget that's working for them," The top Democrat on the Finance Committee, Ranking Member Bride Rose Sweeney (D-Westlake), said.
The final budget proposal ranges from changes to taxes, education, social services, health care and much more.
In the Senate, there was a 23-10 vote. Only state Sen. Bill Blessing (R-Colerain Township) joined the Democrats to vote no.
In the House, it was 59-38. State Reps. Tim Barhorst (R-Fort Loramie), Levi Dean (R-Xenia), Ron Ferguson (R-Wintersville), Scott Oelslager (R-North Canton) and Michelle Teska (R-Clear Creek Township) joined the Democrats.
Income tax
They passed a 2.75% flat income tax, meaning the highest earners in the state, those making more than $100,000 a year, will no longer have to pay 3.5% in income tax, making them equal to the lower tax bracket.
"We are making Ohio more competitive, more open for business," Stewart said.
State data reveals that this could result in a loss of more than $1.1 billion in the general revenue fund. This was made up by cutting social services and some tax exemptions. Sweeney said cuts came to public education.
RELATED: Ohio Senate GOP moves to give wealthiest Ohioans tax cut
Education
Public schools will face hundreds of millions of cuts from their expected budget, but the funding formula will stay intact for the most part.
"We're underfunding our schools by at least a billion dollars," Sweeney said.
Lawmakers would also be giving additional school funding to high-performing public school districts.
RELATED: School funding provision in Ohio budget would primarily benefit suburbs
There is a cap on districts' rainy day funds at 40% carryover from the previous revenue fund. This would mean that the schools would have to refund anything above that back to the taxpayer to provide property tax relief.
"We're looking at more local control," Senate Finance Chair Jerry Cirino (R-Kirtland) said.
"How is it local control if we're capping carryover at 40%?" I asked him.
"It's the budget commission that is representing the people," he responded, also adding that there are exceptions so that the districts can carry over more than 40%, as long as they are put in a capital fund instead of operating. However, schools are unable to move money back to the operating fund once they are in the capital.
The House wanted to cap the districts at 30% and the Senate 50%, which is why they settled in the middle.
RELATED: Why you could see more school levies in Ohio's future
If voters pass a school levy, the bill allows county budget commissions to unilaterally take money away, if they find it "reasonably necessary."
The bill also eliminates levy replacements on property taxes for all political subdivisions. For schools, it prohibits them from imposing a fixed-sum emergency levy, a substitute emergency levy and a combined school district income tax and fixed-sum property tax levy.
It also prohibits a school district from submitting any current expense levy to voters if it has a general fund carry-over balance of more than 100% of general fund expenditures in the preceding fiscal year. It excludes renewal levies, though.
They kept the Governor's Merit Scholarship, guaranteeing admission to a public university for each high school graduate in the top 10% of their graduating class. The students would also get $5,000 each year in financial aid.
However, the bill requires the student to sign a "statement of commitment" to stay in Ohio for three years after graduating.
RELATED: Would you live in Ohio for 3 years for $20,000 in college aid?
They also give more than $30 million to five "intellectual diversity" centers at different public colleges across the state. These centers were created to combat what some consider liberal bias at universities.
RELATED: Ohio GOP supports college overhaul bills to create ‘safe space’ for conservatives
The budget will provide about $2.5 billion over the biennium for the state's voucher system — providing taxpayer dollars for students to attend nonpublic schools. This includes a new education savings account program, or ESAs, which is a way for families to get state money to purchase "educational goods and services," including tuition at nonchartered, nonpublic schools.
This comes a day after a Franklin County court ruled Ohio's EdChoice voucher program to be unconstitutional.
Property taxes
The restrictions on levies and carryover caps in the education budget are meant to give relief to property taxpayers. District cash carryovers have increased year-over-year from $3.6 billion to $10.5 billion since tracking began in 2012, the GOP reported.
The bill also allows the boards of county commissioners to provide up to a 2.5% owner-occupancy tax credit and a permissive homestead exemption for those who qualify.
Cleveland Browns
The Browns will be getting $600 million for their new Brook Park stadium. The budget calls for the state to take legal ownership of $1.7 billion in unclaimed funds, setting a clock on how long people have to file claims and get reunited with their missing money.
RELATED: Ohio lawmakers settle on unclaimed funds to put $600M into new Browns stadium
That’s a major change for Ohio, which currently holds unclaimed funds in perpetuity. The budget proposal would give people a decade to claim their money before it becomes the state’s property. Lawmakers want to grab $1.7 billion out of Ohio’s $4.8 billion pool of unclaimed funds right away – and then continue taking money on a rolling basis, after a decade of holding it.
A last-minute amendment to the compromise budget bill, released late Tuesday, would change a state law designed to make it harder for pro sports teams to leave publicly subsidized facilities, clearing a significant obstacle from the Browns' road to Brook Park.
RELATED: Lawyers plan to sue if state takes unclaimed funds for Browns
The new language says the so-called Modell law, designed to prevent major sports teams from pulling up stakes, would only come into play if a team chose to leave the state.
The proposed changes to the law are likely to end a court battle that's just getting started and take leverage away from the City of Cleveland, which is fighting to keep the Browns on the lakefront or negotiate a better exit deal if the team leaves.
Pensions
First reported by us on Tuesday, state lawmakers chose to remove the majority of educators' voices from the state's retired teachers' pension fund board.
Amid legislators' concerns of an alleged corruption scheme threatening the fund, they have decided to reduce the number of elected positions and add more political appointments.
A provision in the bill would change the makeup of the board from seven elected teachers—five contributing and two retired—to three elected after seats are phased out over several years. Two of the educator seats will be for actives and only one retiree seat. Each elected member will be able to finish their term, but once their term is out, four of the seven seats will not be refilled.
Those four removed educator seats will be filled with newly appointed members. Right now, the governor gets to appoint one investment expert. The Speaker of the House and the Senate President jointly appoint an expert. The treasurer gets an appointee, and so does the director of the Department of Education and Workforce.
RELATED: Ohio lawmakers set to remove majority of educators from retired teachers' pension fund board
"The state legislature established these pension systems and has an ongoing responsibility to ensure the long-term health of the fund for retired and active teachers," Provision Proposer State Rep. Adam Bird (R-New Richmond) exclusively told me Tuesday. "The ongoing turmoil has clarified the need for the General Assembly to rebalance the Board composition."
Health and child care
Numerous changes to Medicaid could put hundreds of thousands of Ohioans at risk of losing health insurance. The legislators also restricted access to Medicaid for babies.
The lawmakers funded a Child Care Choice program, which would provide millions for eligible families to cover child care services. There is also money going toward eyesight programs and families with children with disabilities.
RELATED: Ohio families urge GOP to fund affordable child care in budget
The budget also cut DeWine's proposed pediatric cancer research funding by half.
Miscellanous
Other provisions in the massive budget bill have nothing to do with spending, including:
- Prohibiting SNAP for “sugar-sweetened beverages”
- Requiring public libraries to place books related to sexual orientation or gender in an area away from the public
- Adding more reporting requirements for abortion
- Enshrining into state law that there are only two sexes
- Stops funding for both youth homeless shelters and mental health services that support transgender or nonbinary identities
- An ability to lock lost or stolen EBT cards
"At the end of the day, we have to remember that budgets are about choices," Sweeney said. "We were elected to make choices for the people of Ohio, and we believe that this budget is making the wrong choices."
Next steps
Since both the House and the Senate passed the bill, it will be sent to the governor's desk. DeWine will decide which provisions to line-item veto.
Line-item vetoing is the ability for the governor to pick and choose which policies within a larger piece of legislation get to stay or must go.
In the past operating budget, he issued about 40.
We will continue breaking down what is in the 6,000-page bill in the coming days.
