The Senate Republican Caucus Monday released highlights of their FY16-17 budget proposal, HB64 (R. Smith), but details are still to come as the actual bill will be unveiled Tuesday in the full Senate Finance Committee and/or as negotiations continue — both now and into the conference committee later this month.
Senate President Keith Faber (R-Celina) told reporters that, “This is a balanced budget that invests in Ohio’s priorities, while still making our tax rate more competitive, saving for emergencies and putting millions of dollars back into the hands of the people who earned it. We’re continuing to build on our commitment to fund what matters and return what isn’t essential.”
Broadly, this means maintaining the House-passed 6.3 percent across-the-board personal income tax cut; eliminating taxes on the first $250,000 of net income for small businesses and establishing a 3 percent flat tax rate on income above that amount; increasing funding for K-12 schools and working to phase-down the tangible personal property tax (TPPT) supplement; increasing the state share of instruction for higher education institutions by $240 million over the biennium; and reducing Medicaid spending by $1.5 billion while also restoring coverage for pregnant women up to 200 percent of poverty and for breast and cervical cancer screenings. No increase is anticipated for the CAT tax and the severance tax will be addressed by future legislation, probably soon.
In another change, Faber said the Senate is proposing to increase the maximum that can be placed in the state’s Rainy Day Fund (RDF) from 5 percent of the previous fiscal year’s General Revenue Fund (GRF) revenue to 8.5 percent.
As questions continued about where all the funds to accomplish these ends came from, Faber noted that his caucus removed a lot of the earmarks and capital expenditures that had made it into the budget. “If it was a new program, it’s likely not funded,” he added, as he challenged reporters to go “line by line.”
Addressing how the Senate Finance Committee had approached the budget, committee chairman, Sen. Scott Oelslager (R-Canton) said that amendments are due on Thursday, June 11 with the omnibus amendment set for action on Tuesday, June 16. It is still the plan to have the bill on the Senate floor on Wednesday, June 17.
He did indicate that there are drafting issues that could delay the substitute bill’s unveiling on Tuesday, June 9.
Reacting to the Senate proposal, Gov. John Kasich spokesman said, “The governor proposed an aggressive strategy to keep moving Ohio forward. There is still work to be done, and we will continue to push for a larger income tax cut and urge against overly optimistic economic assumptions, but it’s encouraging progress.”