Ohio Senate GOP budget increases school funding, gives Browns $600M grant, creates flat tax

Yahoo

2 days ago

Senate President Rob McColley, R-Napoleon, speaks at the Ohio Senate Republican Budget Press Conference. Sen. Jerry Cirino, R-Kirtland, the chair of the Senate Finance Committee, stands in the background. Photo: Morgan Trau, WEWS
The Ohio Senate has announced its version of the state budget, one that provides a slight increase in public school funding, gives a $600 million grant to the Cleveland Browns for their new stadium and creates a flat income tax of 2.75%.
Senate President Rob McColley (R-Napoleon) and Finance Chair Jerry Cirino (R-Kirtland) announced their proposed amendments to the state's biennial operating budget on Tuesday afternoon. House Bill 96, the number for the House's budget bill, passed in April.
The senators increased the amount of money going to public schools compared to the House's proposal. The Senate budget gives public schools about $100 million more than the House. Although it follows most of the House's proposed budget – which only gives schools about $226 million for school funding, or $550 million total – the Senate changed the funding 'guarantee' amount. Right now, some districts have guarantees that a portion of their funding will not be reduced, even if their enrollment goes down.
However, to be fully funded, based on statistics from the Fair School Funding Plan from 2021, schools would need an additional $666-800 million, compared to the $226 million given by the House.
They also raised the House proposal's cap on districts' rainy day funds to 50%, instead of 30%. This would mean that the schools would have to refund anything above that back to the taxpayer in a method legislators want to use to provide property tax relief.
The Senate's budget proposal still includes $600 million for a new Cleveland Browns stadium in Brook Park. However, the funding structure differs from what the Browns proposed and what the House approved earlier this year.
The House proposed borrowing $600 million by issuing bonds and repaying the debt, with interest, over 25 years, at a cost of about $1 billion. The Senate is proposing a $600 million grant for the stadium using unclaimed funds. That money is property of Ohioans held by the state, things like forgotten bank accounts, rent or utility deposits or uncashed insurance policies. The Ohio Department of Commerce's website says the state is sitting on $4.8 billion in unclaimed funds.
The Senate believes the state will more than recoup that investment through sales tax, income tax and commercial activity tax revenues from the 176-acre Brook Park stadium district.
The budget also includes a 2.75% flat income tax. This mirrors a bill currently in the House, which would eliminate the separate brackets of the non-business income tax. People making more than $102,400 would have their taxes reduced from 3.5% to 3.125% in 2025 and then down to 2.75% in 2026. The lower bracket would stay at 2.75%.
Now, the Senate and House leaders will enter a conference committee, a closed-door negotiation period to create a final budget. Once a decision is made, both chambers must pass the combined bill. If it passes through both sides, it will be sent to Gov. Mike DeWine for review. In the past, he issued dozens of line-item vetoes on operating budgets.
Line-item vetoing is the ability for the governor to pick and choose which policies within a larger piece of legislation get to stay or must go.
DeWine is adamantly against giving the bond package to the Browns, and we have asked repeatedly if he plans to veto it. He says he hopes it doesn't get to that point.
The budget must be passed by the end of June.
This is a developing story and will be updated.
Follow WEWS statehouse reporter Morgan Trau on Twitter and Facebook.
SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX
SUPPORT: YOU MAKE OUR WORK POSSIBLE