Ohio budget plan sent for final votes

Lawmakers won't cut own salaries

A conference committee sent the House and Senate a final $55.7 billion two-year budget proposal.

COLUMBUS -- By a party-line 4-2 vote, a state committee late last night sent the Ohio House and Senate a final $55.7 billion, two-year budget proposal that promises substantial pain for schools, local governments, and many social services.

But first, the six-member House-Senate conference committee took out a provision that would have required legislators to share in some of that pain by cutting their pay by 5 percent or about $3,000 each.

Final up-or-down votes on the roughly 5,000 page, policy-heavy budget bill are expected in the full Senate Tuesday and in the House as early as Wednesday. Gov. John Kasich has until the end of the current fiscal year at midnight Thursday to sign a budget into law.

The committee yielded to Mr. Kasich's demand that the budget include a provision that eliminates automatic pay hikes for teachers based on their years on the job and educational attainment and substitutes performance-based pay.

The budget now requires the State Board of Education to develop a framework for a teacher performance-pay system by Dec. 31 that would apply to districts, including Toledo Public Schools, that receive a portion of Ohio's $400 million share of federal Race to the Top funding awarded to a handful of states that enacted certain education reforms.

The Race to the Top funding came with such a teacher-pay requirement attached. Districts not participating in Race to the Top could voluntarily opt into the assessments.

Half of the annual teacher assessments would have to be based on measurements of student academic growth and the rest on such factors as classroom evaluations. The plan must include a method for removing poor-performing teachers.

All districts would have to buy into the merit pay system as of July 1, 2013, or after the expiration of the teacher contract in place as of that date. If the Toledo Board of Education and its teachers' union do not reject a fact finder's report in votes Tuesday, the resulting two-year contract would presumably be locked in through July 1, 2013. The fact finder's report does not include a teacher merit-pay system but does recommend an immediate 2.5 percent pay cut.

The budget, like Senate Bill 5, would prohibit the use of seniority as the sole factor in determining the order of teacher layoffs. Democrats objected to including the teacher assessment language in the budget because of its overlap with Senate Bill 5, the law restricting public employee collective bargaining that is expected to be the subject of a Nov. 8 voter referendum.

The committee went with the Senate-passed version of the budget as to how it distributes roughly $6 billion in direct basic education subsidies to schools. The Senate version provides a total of $115 million more for schools than the House version did -- about $85 million of which would go into the total subsidy pot for distribution and $30 million to high-performing districts.

Democrats argued that the earmark for high-performing districts disproportionately benefits wealthy districts. "This is an unfair and inequitable distribution," said Sen. Michael Skindell (D., Lakewood), a committee member.

But the committee's chairman, Rep. Ron Amstutz (R., Wooster), countered, "I will point out that there are districts not far from mine that are not very wealthy at all but are very high-performing."

Despite the cuts, the budget continues the tax-cutting course charted by the Republican-led General Assembly. It preserves the final 4.2 percent increment of a multiyear income tax cut that took effect on Jan. 1. That's worth about $800 million over the biennium.

It also eliminates the estate tax as of 2013, 80 percent of which currently goes to local governments and schools, and created a new income tax credit against gains earned from investing in Ohio small businesses that will take effect in 2013.

Democrats have held up these tax cuts as examples of how the Republican-written budget advantages wealthier Ohioans while imposing cuts on programs affecting the poor and middle-class families.

The committee made good on deals struck by Mr. Kasich with the two owners of four voter-approved casinos under development, including one on Toledo's riverfront. It stripped from the budget language that would have required the casinos to pay Ohio's Commercial Activity Tax on all revenue collected before prize payouts are deducted rather than after.

The plan eliminated a Senate proposal that would have required the Ohio Lottery to contract with a private company to conduct its operations, but still allows the Kasich administration to seek a long-term lease for operation of the Ohio Turnpike. Mr. Kasich would have to win legislative approval on the terms of such a deal before sending out notices for bids.

The conference committee resuscitated enforcement of Ohio's 4-year-old, voter-approved smoking ban, which would have seen its funding eliminated under prior versions of the budget.

The compromise moves money around to make $1 million available in both years of the budget to fund enforcement efforts at the local level. It would earmark federal funds to continue operation of the state's quit line to help smokers kick the habit.

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