As DeWine originally proposed in March, the $69 billion plan includes increased spending on education, public-health and water-quality programs. Putting stronger-than-expected state revenues to work, the legislature added tax changes that amounts to a $680 million tax cut over two years. That includes the elimination of taxes on Ohioans’ first $21,500 of income and a flat 4% tax cut for all income above that.
DeWine now has until 11:59 p.m., when a temporary funding measure lawmakers previously approved by lawmakers will expire, to sign the budget. State legislators passed the interim budget after talks broke down, causing them to blow a June 30 legal deadline to pass a permanent budget in the first time in a decade.
“We got a little into extra innings, but I believe the final product is worth it,” said Senate President Larry Obhof, a Medina Republican.
“We’re sending the strong statement that the best use of people’s dollars is to send their money back to them so they can reinvest those dollars and reinvest in their business,” said Chagrin Falls Sen. Matt Dolan, a Republican who played a key role in budget negotiations.
The bill passed with bipartisan support, clearing the House by a 75-17 vote and the Senate 29-1. Fifteen of 38 House Democrats voted no, including Cuyahoga County Reps. Juanita Brent, and Kent Smith. Toledo Sen. Theresa Fedor, a Democrat, was the lone ‘no’ vote in the Senate.
“When we add up the score card, there are a lot more good things in this budget than there are things that I can complain about,” said Sen. Kenny Yuko, of Richmond Heights, the top Democrat in the Senate.
The budget spends $172 million over two years for the “H2Ohio” fund, which DeWine proposed to pay for programs to protect Lake Erie and other state waterways from pollution. In a last-minute change, the budget requires half of all of the state’s left-over money at the end of 2021 to be sent to the H2Ohio fund.
DeWine had proposed setting aside $900 million for the fund, but state lawmakers have said they’ll consider borrowing the money in the future.
It also sets aside $675 million for new “wrap-around” support services — after-school programs, tutoring, counseling and other support services for at-risk, public school students.
The budget bill includes myriad provisions aimed at reducing health-care costs, including imposing requirements on hospitals and insurers meant to increase price transparency and prevent surprise billings.
“This budget is going to be called by many the ‘children’s budget,’” said Dayton-area Rep. Jim Butler, a Republican. “This budget could also be called in my opinion the health-care budget.”
Some Democrats who voted against the bill cited a provision that places a one-year moratorium on state takeovers of struggling schools. An earlier version of the budget passed by the House ended the takeovers altogether.
“This bill looks the other way and goes off on a lunch break when it comes to our responsibility to educate our children,” said Democratic Rep. Michele Lepore-Hagan of Youngstown.
Akron Rep. Emilia Sykes, the highest-ranking Democrat in the House, voted for the bill, but called on DeWine to veto aspects of the budget her party didn’t like, including $7.5 million in increased funding for “crisis pregnancy centers” — health clinics that discourage women from getting abortions — increased funding for private-school vouchers for students in struggling school districts and a March 17, 2020, primary date that Cleveland-area officials are concerned will conflict with an annual St. Patrick’s Day parade.
The bill largely preserves a deduction that makes the first $250,000 of income for LLCs and other business entities free from state taxes, after earlier versions of the budget sought to roll the tax-cut back. But the final version makes “lawyers and lobbyists” ineligible for the tax break.
Some lawmakers said the exclusion for lawyers and lobbyists arbitrarily picks on a pair of sometimes-unpopular professions. Sen. Matt Huffman, a Lima Republican and an attorney, said he expects the provision will be found unconstitutional.
“I will ask you to consider what profession is next? Who is it we decide we don’t like?” Huffman said.
Other provisions include:
• Raises the age to buy cigarettes and other tobacco products from 18 to 21.
• Creates a new tax on vaping products at 10 cents per milliliter.
• Creates a tax-credit for property owners worth up to $10,000 to remove lead paint. The budget sets funding for the entire program at $5 million.
• Creates a “one-in, two-out” rule, requiring state agencies to eliminate two rules every time they seek to create a new one.
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