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COLUMBUS — Gov. John Kasich will unveil his biennial budget proposal Monday, Jan. 30, kicking off the main order of business for state lawmakers between now and the end of June.
He’s offered hints about what he plans to include, and lawmakers have offered hints about policies they’ll support or oppose.
Here are 10 things you can expect about Monday’s budget rollout and coming legislative deliberations:
1. Tight Budget: The governor and his administration have been warning for weeks that the coming biennial budget will be tight.
Like other states, Kasich has said, Ohio’s revenues are lagging projections. Late last year, the governor told the Ohio House that the state could be on the verge of a recession.
Translated, that means no big spending increases over the next two fiscal years as part of the executive budget proposal.
“We haven’t slashed any budgets,” he told and audience in Columbus earlier this month. “We’ve been putting more money into things… We spent a lot of money in a lot of programs… What we really ought to be thinking about as we budget is how much have you really gotten over the past few years and you can trim some of it back.”
He added, “We can’t look at government as cutting when actually what we’re doing is we’re reducing a significant increase and we have to think about those things that way and we also have to innovate to squeeze out the most we can out of efficiency so when the tough times come, we deal with it.”
2. Increases: That’s not to say that all agencies will be flat funded or see cuts to their budgets.
Kasich said last week that he will propose a 2 percent increase for funding for primary and secondary schools over the biennium and something similar for higher education.
That amounts to about $200 million over the next two fiscal years for K-12.
“…We don’t have any more money, OK?” Kasich said. “But we have had a consistent increase in education over the last six years, and we’re going to have a [mid-biennium review]… If we get more revenues, then education will obviously be one of our priorities — will be frankly always our top priority in the state.”
The increase may not be enough for lawmakers, however.
“We are concerned about and disappointed that Gov. Kasich’s proposed budget has only a 1 percent increase in funding [per fiscal year]…,” Sen. Vernon Sykes (D-Akron) said during a press conference Friday. “That’s just really not good enough.”
The Republican leaders of the Ohio House and Senate said they were waiting to see the details of the school funding plan before taking a position on the proposed increase.
“The devil’s in the details,” said House Speaker Cliff Rosenberger (R-Clarksville). “… I think our continued emphasis, though, on making sure most importantly we don’t shift goal posts on our schools is going to be our No. 1 process that I’m going to look at….”
Senate President Larry Obhof (R-Medina) added, “Until we see what the entire budget plan is, I’ll reserve judgment on that… I think it will be a challenging budget cycle as we’ve discussed before, but when you’re talking about 3,000 or potentially 4,000 pages of material, we’ll delve into that as time goes on.”
3. Schools and Jobs: In December, the Governor’s Executive Workforce Board unveiled a series of recommendations aimed at better preparing Ohio’s school kids for future careers.
Kasich had asked the panel in September to develop the list, with plans to include some of the provisions in his executive budget proposal.
In recent weeks, the governor has mentioned one of those proposals multiple times — requiring schools boards to take on several representatives of local business communities as nonvoting members to provide guidance on ways to connect classroom instruction with work force needs.
There likely will be other provisions in the budget that would enable primary and secondary students to earn classroom credit for business-related activities away from school.
4. Medicaid Tax Fix: The governor told a business audience in Columbus earlier this month that his budget proposal would include a temporary fix on a sales tax issue that will affect local governments and public transit systems.
The federal governments is closing a loophole that Ohio and other states have used to secure matching funds for its Medicaid program.
The state has to act on the issue by the end of June. An estimated $200 million annual hole for local governments is expected to be created.
The issue has drawn the attention of state lawmakers, including Reps. John Boccieri (D-Poland), Michele Lepore-Hagan (D-Youngstown) and Glenn Holmes (D-McDonald) and Senate Minority Leader Joe Schiavoni, who sent Kasich a letter urging him to preserve funding for local governments that will be lost as part of the Medicaid Managed Care Organization tax changes.
“If local revenue sharing isn’t preserved, the legislature will cripple our communities with another unbearable budget hit,” Boccieri said in a released statement.
And Schiavoni told reporters Friday, “Some counties are going to lose up to 30 percent of their local government [funds]. Now you’re talking about getting rid of police officers and vital services, it’s not just a little nick in your budget. I’m interested to see what the governor’s proposal is going to be to fill those giant holes.”
5. Tech Focus: Kasich told an audience in Columbus that he wanted to create a “chief innovation officer” in state government to help spearhead the commercialization of new technologies being developed at Ohio’s universities and elsewhere.
“Do you know how many commercialized items we get out of our universities?” Kasich asked. “Virtually none… Our chief innovation officer is going to be able to take all of the research that’s being done and move it in a direction where we can actually bring about commercialization….”
The governor also has announced funding for efforts to solidify the state’s leadership role in the development of autonomous vehicles, with an investment in a central Ohio research center, the expansion of “smart corridors” in Columbus and between Cleveland and Pennsylvania and other efforts to test self-driving vehicles.
6. Data Analytics: Kasich discussed plans during a press conference earlier this month to expand the state’s use of predictive analytics, which are already used by Cleveland Clinic and others to improve medical treatment for patients.
Kasich wants the state to use those same techniques to improve government.
“We do some of this already, but we’re really going to dramatically step this up,” he said. “We believe there’s ways in which you can reduce infant mortality. We believe there’s ways in which you can better fight the drug problem. We believe there’s better ways to do transportation. I mean, there’s so many areas here that if you can collect data, aggregate data and take a look at trends, you can get ahead of problems before they occur, you can make government more effective and more efficient while at the same time maintaining the most important thing, which is our individual privacy.”
7. Expect Some Pushback: Don’t expect Republican lawmakers to support a tax hike for oil and gas produced via horizontal hydraulic fracturing or other tax increases.
“… In the House, we’re preparing to ensure that we can do what we can to continue to keep more dollars in the pockets of Ohioans so that they can spur the economy, make sure we look for policies, practices that don’t allow for tax shifting but allows for predictability and certainty into the future,” Rosenberger said. “We’re not going to move on a CAT tax. We’re not going to do things on severance tax….”
He added, “Education, of course, is clearly important. Also mental health and recovery and taking care of our aging population, issues that we’ve talked about in the last few years… and ensuring that we continue to make the health care system more effective and efficient is going to be a big deal as well.”
8. Democrats: Democratic lawmakers have their own priorities that they’d like to see included in the biennial budget.
Senate Democrats’ list includes more funding for career technical education and improvements to school-related work force training programs and tighter checks and controls on charter schools, among other ideas.
They’re not in favor of more tax cuts.
“… We’ve been giving tax cuts every single year, mostly to the highest earners, and … we’ve failed to make the investments into our schools, into our local governments and into those programs that [affect] our most vulnerable citizens,” Schiavoni said. “… We gave $1.7 billion last time back in tax cuts. Our jobs plan that we have is $100 million. That’s a fraction. They have to find the money for investing in business. They have to find the money to invest in our kids. You have to invest first, and if there’s money left over and you want do a tax cut, do a tax cut, but don’t shift everything around and increase the sales tax and try to put all these new taxes in place.”
9. No Redistricting Reform: The governor said earlier that he planned to include a congressional redistricting reform package as part of his executive budget proposal.
But a spokeswoman said Friday that Kasich had reconsidered the inclusion.
“The governor is working with legislative leaders to find the best path forward on redistricting reform and is encouraged by their commitment on this important issue,” Emmalee Kalmbach said in a released statement.
That news came after Rosenberger told reporters that he had discussed the issue with the administration, with plans for further consideration during the new session.
Rosenberger and other Republicans have balked at moving congressional redistricting reform, however, saying he wanted to wait to see how comparable state legislative redistricting reform works. He and others also have said they don’t want to take congressional redistricting authority out of the hands of state lawmakers.
“… We’re going to probably start working on something to look at this congressional redistricting here in Ohio…,” Rosenberger said. “We’re going to take a very serious look at this over the next two years.”
10. Something to Remember: Monday’s executive budget rollout is only the beginning of the process.
The House Finance Committee is scheduled to begin hearings on the two-year spending plan on Wednesday.
Lawmakers in the House and the Senate will spend the next five months listening to testimony and amending the plan proposed by the governor.
A final budget is expected to be approved by the legislature and sent back to Kasich’s desk for enactment before the start of the new state fiscal year on July 1.
Marc Kovac is the Dix Capital Bureau Chief. Email him at firstname.lastname@example.org or on Twitter at OhioCapitalBlog.