Ohio House wants to spend more as it looks for cuts

4/9/2003

COLUMBUS - A two-year budget plan still being hammered out early this morning in the Ohio House would mandate of a new community college in Warren County even as it calls for closing a law school and a study into merging other colleges.

Despite calls for leaner government, Republicans have slipped in language to expand membership on a variety of boards and councils, including the public utilities, racing, civil rights, and elections commissions.

Speaker Larry Householder (R., Glenford) said yesterday he still expects the final plan for 2004 and 2005 to cost $1 billion less than the $49.2 billion budget proposed by Gov. Bob Taft.

The plan would temporarily add a one-penny surcharge to the state's 5-cent sales tax. The amended bill calls for the tax to remain in place for two years starting July 1, raising $1.2 billion a year.

At the same time, the tax base would be expanded to include services such as storage, towing, dry cleaning, personal care, taxis, limousines, and satellite television.

The speaker said there were still plans to ask voters in November to approve video slot machines at Toledo's Raceway Park and six other horse-racing tracks. If voters say yes, the sales tax surcharge would be repealed after one year.

Given Mr. Taft's vow to veto any such language in the budget bill, the House may seek to pass a joint resolution to place the issue on the ballot. That would bypass the governor, but it would require 60 votes for passage, unlike a simple majority of 50 to pass the budget.

“We're growing revenues without arresting the costs,” said Rep. Stephen Buehrer (R., Delta). “That aside, there are significant concerns about the impact from a society perspective.”

House Minority Leader Chris Redfern (D., Catawba Island) said Democrats planned to oppose the bill.

With the exception of the expansion of the sales tax base and changes in the municipal tax, the House has, at least for now, abandoned Mr. Taft's broader tax-reform plan that would also have addressed corporate and personal income taxes.

The business-backed changes to the municipal tax system are designed to make it more uniform. They include uniform bases for the municipal income tax on net profits and withholding, and a five-year period for net operating loss carry forward. Two-thirds of municipalities do not allow any net operating loss carry forward - which allows a business with a loss to offset the amount of tax it pays on future gains.

The bill, as amended yesterday by the finance committee, restores Medicaid funding for adult dental, vision, and podiatry coverage, all of which were targeted for elimination by Mr. Taft. It boosts aid over Mr. Taft's plan by $15 million to Passport, a program providing in-home care for the elderly as an alternative to nursing homes. It restores funding for university doctoral programs.

But urban school districts such as Toledo are concerned about the House's plan to move toward distributing basic student aid to districts based on actual attendance. Currently, districts take a student head count each October and are funded according to a three-year enrollment average of those numbers.

The new plan, when fully implemented by 2005, would require districts to count heads daily and make monthly reports to the state, a move expected to save the state $50 million between 2004 and 2005.

“Going from the three-year average to actual attendance for a district like Toledo, where enrollment is declining, could have a potentially significant effect,” said Jim Fortlage, treasurer of Toledo Public Schools.

Columbus Bureau Chief James Drew contributed to this report.