As expected, Republicans in the Ohio House will introduce a budget that includes an income tax cut and an expansion of taxpayer-paid school vouchers. But the tax cut in the $86 billion, two-year spending plan may be a surprise to some critics, as well as the income level for the voucher program.
The House version of the budget would exempt incomes under $26,050 from income tax, and combines the bottom two tax brackets and cuts the tax rate to 2.75%, down from 3.226%. That鈥檚 in contrast to previous income tax cuts that analysts have shown have helped wealthier Ohioans the most.
The budget also exempts train derailment payments to East Palestine residents from state taxes.
But the budget does not make the changes to property taxes in House Bill 1, the top priority of Speaker Jason Stephens (R-Kitts Hill). Those changes would bring in revenue to pay for the income tax cut, but lawmakers鈥� researchers estimated they would raise taxes for homeowners and agriculture property owners by $929 million.
The EdChoice voucher program would expand to incomes up to 450% of the federal poverty level, or $111,000 for a family of three. Gov. Mike DeWine's initial budget plan had an expansion of EdChoice to 400% of the federal poverty level. Currently the EdChoice threshold is 250% of the federal poverty level.
Years three and four of the six-year phase in of the K-12 financing formula known as the Fair School Funding plan are fully paid, and the House budget keeps in $162 million to teach the phonics-based 鈥渟cience of reading鈥� from DeWine鈥檚 original budget plan, but also completely scraps the 鈥渢hird grade reading guarantee鈥� requiring kids to be retained if they don鈥檛 achieve a certain score in the reading assessment in third grade, an idea championed by former Gov. John Kasich. And it eliminates $200 million in surplus spending on career tech programs.
The budget keeps DeWine鈥檚 fund for preparing large sites for big economic development but lowers the funding for it, but it puts half a billion dollars into a brownfield remediation and cleanup program.
House Bill 33 will be introduced in the House Finance Committee Tuesday morning, with a vote likely in committee this week and on the floor next week. Then the budget would go to the Senate and will likely see more revisions.
The budget must be signed and in place by the end of June.
