COLUMBUS, Ohio (AP) — The Ohio House approved a sweeping
package of spending and policy initiatives spearheaded by Gov. John
Kasich on Wednesday, after stripping out the governor’s signature tax
provision on oil and gas.
The midterm budget bill trims state
spending by $69 million through cuts and cost-saving ideas, while
setting aside $30 million for high-quality nursing homes and $3 million
to establish a "healthy Lake Erie" fund intended to benefit businesses,
farmers and tourism. It cleared the House 61-33, and heads next to the
Senate.
House Finance Chairman Ron Amstutz, a Wooster Republican,
said the bill encourages the state’s fragile recovery while protecting
slowly growing revenue accounts.
"At the end of this day, what we
are doing here is maintaining a steady course in (setting) our budget on
a recovery course, while approving a wide range of programs and process
improvements for our citizens," Amstutz said.
Kasich’s fellow
Republicans in the House opted to pull his tax hike proposal for more
study. It calls for increasing Ohio’s severance tax on oil and gas
production by 4 percent and spending the revenue on income-tax relief.
The governor continues to fight for the plan.
Rep. Vernon Sykes,
an Akron Democrat, said he opposed the bill for what wasn’t in it: money
to restore cuts to schools and local governments. He criticized
Republicans for failing to spend any of a projected $265 million surplus
in the bill.
"Be clear that it is irresponsible, it is
unconscionable, to just hold onto this money when so many people are
hurting in our communities," he said.
Rep. Barbara Sears, a
Sylvania Republican, defended the decision and criticized Democrats for
spending tax dollars "like Monopoly money" and prioritizing an expensive
high-speed rail project when they controlled the state’s purse strings.
Amstutz
noted that litigation by opponents of Kasich’s effort to privatize
state economic development functions, JobsOhio, represents "a $500
million threat to our ending balance" that needed to be taken into
consideration when drafting the bill.
Kasich’s administration took
the unusual step of crafting the midterm budget bill outside the normal
two-year budget cycle, as a way to move forward with policy initiatives
the governor launched last year after taking office.
The House
vote followed dozens of committee changes made Tuesday. The changes
included pulling from the bill a provision that sent Planned Parenthood
to the back of the line for federal funding, but keeping a provision
that establishes state trooper authority in privately owned correctional
facilities.
It moved forward over the objections of local
government and school groups that wanted to see the spending plan send
more state revenue to police, fire and school district coffers hit by an
earlier round of budget cuts. To that end, Democrats sought to create a
revolving Kids and Communities First Fund, but were unsuccessful first
in committee and again on the House floor.
Under the Democrats’
proposal, Kids and Communities First would initially be funded by
projected surplus tax revenue and dollars from the state’s rainy-day
fund then, as an ongoing money source, be funded from Kasich’s proposed
tax hike on oil and gas extraction.
Kasich wants to hike oil and
gas extraction taxes to 4 percent in two or three years. Energy
companies swarming the state in search of new natural gas and oil
resources in the Marcellus and Utica shale plays would have the option
to waive the tax to offset startup costs. Income tax reductions would
begin in 2015, and deepen as proceeds rose.
The oil and gas
industry opposes the tax increase as a deterrent to industry growth that
Kasich is counting on to improve the state’s economy. But the governor
has dismissed their concerns, saying they can’t get to the oil and gas
unless they come to Ohio.
GOP House leaders spun dozens of
additional Kasich proposals into separate bills that are pending in
committees. Democrats saw amendments fail Wednesday that would have
prevented lease of the Ohio Turnpike, and required licensure and
additional rules on the sale and lease of oil and gas rights.
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Online:
Mid-Biennial Review: http://tinyurl.com/7e2v32v
Copyright 2012 The Associated Press.