Ohio set for House to vote on budget

Kasich plan eases pain for schools

The rotunda of the Ohio Statehouse in Columbus.

COLUMBUS -- A House committee set the stage Tuesday night for a full chamber vote Thursday on a proposed budget that angers casino operators, eases a little of the promised pain for schools, and continues Ohio's tax-cutting course in the face of broad spending cuts.

The committee, which voted 20-12 along party lines for the budget, left intact language that ups the tax ante for casinos under development in Toledo, Cleveland, Columbus, and Cincinnati, holding the casinos to a strict interpretation of gross receipts when it comes to collecting the state's Commercial Activity Tax. The tax is designed to be a broad, low-rate levy that targets all income collected by a business before expenses. The casino operators have argued the tax should apply to revenue after winnings are paid.

House Speaker Bill Batchelder (R., Medina) said Tuesday the language would be removed from the budget because it duplicates current law that applies to the tax. But Gov. John Kasich's office, which is involved in talks to extract more money from the casinos, balked at removing the leverage that the language gave it in those talks.

"Discussion continues," said Rep. Ron Amstutz (R., Wooster), chairman of the House Finance and Appropriations Committee. The speaker's predictions may very well come true, but maybe not as early as even he thought."

Mr. Batchelder said he believes the six-year-old tax applies to the "whole works, not net revenue after prize payoffs."

The tax collects 26 cents on every $100 in gross receipts taken in by a business.

Insertion of the tax language to the budget last week has driven more conversation between the Kasich administration and Pennsylvania-based Penn National Gaming, which is developing the Toledo and Columbus casinos, and Michigan-based Rock Ventures, which is developing the Cleveland and Cincinnati facilities. The 33 percent tax on wagers that was included in the voter-approved constitutional amendment in 2009 largely benefits local governments and schools, not state coffers.

The full Republican-controlled House is expected to approve the budget Thursday, shifting debate to the Senate. A final plan must reach Mr. Kasich's desk by the end of the fiscal year on June 30.

The budget provides little good news as it tries to wipe out an estimated $7.7 billion revenue shortfall largely created because of the current budget's heavy reliance on one-time money such as federal stimulus dollars.

A Statehouse rally is planned for Thursday to support restoration of funds for such programs. Democrats and a coalition of labor, education, and human service groups advocate splitting the pain through a mix of spending cuts and tax increases.

Contact Jim Provance at: jprovance@theblade.com, or 614-221-0496.