Midterm budget bill heads to Kasich’s desk

Ohio Gov. John Kasich delivers his State of the State address at the Performing Arts Center, Monday, Feb. 24, 2014, in Medina, Ohio. (AP Photo/Tony Dejak)
Ohio Gov. John Kasich delivers his State of the State address at the Performing Arts Center, Monday, Feb. 24, 2014, in Medina, Ohio. (AP Photo/Tony Dejak)

COLUMBUS, Ohio (AP) – A package of tax cuts backed by Gov. John Kasich cleared the Ohio Legislature Wednesday night as part of a slew of policy changes made in a midterm budget bill.

Final passage came after lawmakers sought to ensure additional legislative control over $300 million set aside in the budget measure for a Medicaid reserve fund. The fund covers unexpected expenses for the taxpayer-funded health program.

“The House wanted us to put belt and suspenders on it, so we’re putting belt and suspenders on it,” Senate President Keith Faber, a Celina Republican, told reporters.

An amendment inserted into a separate bill sets limits on how the Medicaid money could be used and clarifies that action would be needed by the General Assembly. It seeks to temper GOP lawmakers’ concerns stemming from a legislative board’s approval last fall to fund the Republican governor’s expansion of Medicaid, bypassing the full Legislature.

Republican Rep. Ron Young of Leroy said it would’ve been difficult for him to support the budget measure, knowing that same state Controlling Board had the ability to allocate the Medicaid money. He said the amendment reassures “more paranoid members” such as himself how the dollars would be used.

Democratic Rep. Nickie Antonio of Lakewood objected to the amendment, saying it could tie the hands of those administering the safety-net program for the poor and disabled.

The sweeping budget bill passed on mostly party-line votes. It contains an agreement over how to spend certain funding for mental health and addiction treatment services. Another provision would create an evaluation system for caseworkers at county Job and Family Services departments.

The bill’s tax package supported by Kasich includes a plan to double Ohio’s earned income tax credit from 5 percent to 10 percent for low-income taxpayers and increase personal income-tax exemptions for residents making under $80,000 a year.

The legislation also accelerates a planned 10 percent income-tax reduction by six months by reducing withholding rates on the final 1 percent in July rather than January. And it boosts a small business income-tax reduction to up to 75 percent on income up to $250,000 for the 2014 tax year.

The administration has said stronger state revenue than expected would allow for the cuts, estimated at $402 million.

Democrats called the bill a missed opportunity to invest additional money in children services, schools and communities, not tax cuts. Though Republican backers said it could help the state continue an economic upswing and compete with other states.

A Kasich spokesman said the governor is expected to sign the bill. Kasich can use his line-item veto authority on the measure.

The budget bill also contains a provision that says college athletes are not employees under state law. The status of full-scholarship football players became an issue in March after a federal labor official ruled Northwestern University players are employees and have a right to unionize.

The legislation was among a variety of bills state lawmakers voted on Wednesday, as they sought to finish their legislative work this week before breaking for the summer.

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