2019 Year In Review - Budgets Brought Struggles Between Governor and Lawmakers
2019 brought new leadership in the governor’s office and in the Ohio House. But though Republicans were still in charge in both those places and in the Senate, there were only 21 bills that were signed into law, including four required budgets.
And passing those budgets wasn’t easy.
The week before Mike DeWine’s inauguration in January, former Speaker Larry Householder (R-Glenford) ousted sitting Speaker Ryan Smith in an unprecedented coup – by getting as many Democratic House members to support him as Republicans.
Just weeks after that surprise, one came from the Ohio Department of Transportation: “It is a grim financial situation. It is also a dangerous one," said new ODOT Director Jack Marchbanks.
He said 15 years of flat revenues from the gas tax, inflation in highway construction costs and huge debt payments had driven the agency into jeopardy. DeWine proposed a transportation budget with an 18 cent hike in the state gas tax, the first in 14 years.
That didn’t go over well with Republicans, including Senate President Larry Obhof (R-Medina), who said in late February if there were a gas tax increase, there needed to be an income tax cut in the operating budget.
“I think we should do an income tax cut anyway. But I absolutely would support doing an offset," Obhof said.
But DeWine didn’t embrace a tax cut when he unveiled his two-year state budget in March.
“It seemed to us that we don’t want to raise taxes, we have things that we frankly need to invest in. We need to invest in our citizens, we need to invest in our infrastructure. There’s a time and a place for everything.” said DeWine.
Republican lawmakers and DeWine compromised on the gas tax hike – dropping it to 10.5 centsto raise $865 million a year. The transportation budget was signed two days after the March 31 deadline.
The state budget proved more difficult. In May, Householder explained why the House supported a 6.6 percent across the board income tax cut, along with eliminating the state’s film tax credit and slashing the $250,000 income tax credit for small businesses down to $100,000.
“We shouldn’t try to pick winners and losers. What we should try to do is set a balanced field out there and let people compete in business,” said Householder.
The House’s vote for its budget was nearly unanimous. But the Senate restored those breaks and boosted the income tax cut to 8 percent, and unanimously passed its version. As the June 30 deadline approached, things started to get heated, as Senate Finance Chair Matt Dolan (R-Chagrin Falls) complained about communication with the House.
“We’re here today because there was a cloud hanging over the whole process,” says Dolan.
Householder called that, in his words,” the most bizarre, contrived excuse for continual procrastination” that he had ever heard.
Meanwhile, Democrats such as Rep. Richard Brown (R-Canal Winchester) admitted they were frustratedthat Republicans leaders and the governor couldn’t work the budget out on time but could agree on other bills.
“This is a deadline that we knew was coming and we were unable to meet it which is frustrating and then we look at how much time was spent on various issues such as the so called “Heartbeat Bill."
The budget deal came 17 days after the fiscal year began.
It kept the $40 million film tax credit and the $250,000 income tax deduction for small business owners except for lawyers and lobbyists, and cut income taxes by 4%. It also increased the age to buy tobacco products to 21 and hiked the tax on e-cigarettes. It moved the 2020 presidential primary to March 17 and put new graduation requirements in place. And it added $95 million for indigent defense, $675 million for wraparound services for economically disadvantaged kids, $120 million for children services and $172 million for the H2Ohio water quality fund.
“We have never seen so much emphasis on early childhood education. We've never seen so much emphasis on mental health. We never seen so much emphasis on addiction services. So it's a very, very progressive budget.”
But Democrats including as House Minority Leader Emilia Sykes (D-Akron) were disappointed.
“Overall it was an okay budget. It certainly fell short of what we wanted our Ohio promise to be to our constituents,” Sykes said.
The $645 million Bureau of Workers’ Compensation budget was also passed late, after a dispute over provisions on immigration status and post-traumatic stress disorder claims. Only the $109.5 million Industrial Commission budget was passed and signed on time.
And while it appeared that lawmakers and the governor differed on a lot more than was expected, there were strong agreements on the six-week abortion ban and on the nuclear power plant bailout law.