toledoblade.com --

COLUMBUS - The Ohio Senate proposed a new high-water mark for state spending yesterday by passing a budget that was $600 million more than the House approved.

It would increase expenditures nearly 12 percent over the next two years.

The $49.3 billion plan is expected to be rejected by the House next week, setting up a Republican-dominated House-Senate conference committee to work out a compromise. A budget must be passed before July 1.

Approved 24-9 across party lines, the 3,033-page proposal would outspend Gov. Bob Taft's proposal by about $100 million, and dwarf post-cuts spending in the current biennium by more than $5 billion.

It banks chiefly on a "temporary" one-penny sales tax increase over two years on top of the current nickel on the dollar to raise $2.5 billion.

"This budget is, with these economic times, the best, most focused budget we could put together," said Sen. Bill Harris (R., Ashland).

Just three of 11 Democrats joined six of 22 Republicans to oppose the budget.

In northwest Ohio, Sens. Teresa Fedor (D., Toledo), Randy Gardner (R., Bowling Green), and Larry Mumper (R., Marion) supported the plan while Sens. Lynn Wachtmann (R., Napoleon) and Jim Jordan (R., Urbana) voted "no."

"It doesn't take a rocket scientist to figure out that, when the economy is weak, one of the last things you should do is take money out of the private sector," Mr. Jordan said. "This bill enacts the largest tax increase in history, $2.5 billion, that is taken away from the consumers."

Randy Gardner: Plan spares school cuts.
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Although both sides of the aisle pledged to stand unified in support of its version in conference committee, they expect Mr. Taft's budget forecasters to significantly lower revenue estimates for the next two years.

"I think the administration will have shocking numbers for us as far as revenue projections that are going to change the whole dynamic of the budget," said House Speaker Larry Householder (R., Glenford).

He and Senate President Doug White (R., Manchester) said they believe more substantive tax reform will be back on the table.

While Mr. Taft has pushed a broad $2.3 billion overhaul of sales, personal income, and corporate taxes, both chambers have so far avoided major changes beyond limited expansion of the sales tax base and raising the minimum franchise tax paid by some corporations from $50 to $1,000.

"When we rejected in entirety the governor's package and replaced it with a temporary sales tax ... we shifted the burden back to individual taxpayers ...," said Sen. Eric Fingerhut (D., Cleveland), who voted for the budget.

The Senate plan, in part to lure Democratic votes, restored most of the programs targeted for cuts by the House as well as many by the governor.

"Our state's No. 1 national ranking in terms of state aid to local libraries was threatened and today it is not," said Mr. Gardner. "At one point in the process, our local schools, not all but too many, were faced with 6, 8, 10, 16 percent cuts in state aid and today those schools are not."

The Senate plan would:

Provide $7.2 billion for K-12 education in 2004 and $7.4 billion in 2005, increases of 3.5 and 3.1 percent. It eliminates a House plan to fund schools based on monthly enrollment counts rather than current once-a-year counts, a move that was expected to hurt urban schools.

Provide about $2.5 billion a year in higher education aid, eliminating major House cuts but not restoring levels sought by Mr. Taft. The University of Toledo would receive $82.7 million and $83.8 million in the next two years; Bowling Green, $80 million and $79.3 million respectively; and the Medical College of Ohio, $24.3 million and $24.5 million.

Undoes most Medicaid reform sought by Mr. Taft. The Senate plan would cut optional vision, podiatric, chiropractic, and psychiatric coverage, retaining only dental. It maintains basic health coverage for about 50,000 low-income parents who would have lost coverage under the House and Taft plans.

Sens. Harris, Fingerhut, and Ron Amstutz (R., Wooster) will represent the Senate on the conference committee. The House will name its conferees next week.

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