Senate Budget Has Investment Controls
Posted June 01, 2005 in Press Releases
By Jim Siegel and Catherine Candisky
With the coin-investment scandal fresh in their minds, Senate Republicans approved more budget changes yesterday, including limits on future investing and the elimination of a sales-tax exemption for coin and bullion investments.
Voting along party lines, the Senate Finance Committee approved the $51.2 billion budget that also makes significant changes to nursing-home funding starting in 2008. The House plan would give nursing homes an extra $800 million over two years.
The formula is unsustainable, said Sen. Jeff Jacobson, R-Vandalia, "so it’s hard to support that we ought to keep it going." As the budget goes before the full Senate today, business and social-service advocates give it mixed reviews, although they agree it’s an improvement over the House-passed budget. Gayle Channing Tenenbaum, co-chairwoman of the Campaign to Protect Ohio’s Future, said she’s still worried that 25,000 low-income parents and 15,000 very poor, critically ill adults will lose Medicaid health coverage.
Daniel Navin, director of legislative affairs for the Ohio Chamber of Commerce, said his group still opposes the tax overhaul. The plan phases out two business taxes, creates a new tax on gross receipts, and cuts the state income tax by 21 percent over five years.
The package was made "minimally palatable" by some of the Senate changes, Navin said, including less compounding of taxes on items as they move from production to store shelves.
A group of tobacco producers and retailers said yesterday that the Senate’s 70-cent tax increase per pack of cigarettes would cost Ohio 1,900 jobs. Policy Matters Ohio, a Cleveland research firm, sounded warnings that the Senate’s cap on revenue generated by the gross-receipts tax means its impact will dwindle over time.
Senate President Bill M. Harris, R-Ashland, said the tax plan will create jobs, but changes will be discussed when the House and Senate work out their differences this month.
Much of the committee debate yesterday centered not on taxes or spending, but rather on how to ensure that the Bureau of Workers’ Compensation never again pursues a risky investment without proper oversight.
The bureau invested $50 million with Maumee coin-dealer and prominent Republican donor Thomas W. Noe, whose attorney said last week that up to $13 million in assets are unaccounted for.
Senate Republicans placed into the budget a number of reforms, such as putting two investment experts on the bureau’s oversight commission. Democrats, arguing that GOP plans do not go far enough, offered their own ideas, including a ban on contributions from bureau brokers to any statewide candidate.
Except for a proposal to require annual certified audits of bureau funds, Democratic ideas were rejected. Sen. Ray Miller, a Columbus Democrat, at one point called the proceedings "pitiful," and protested by voting "Noe" instead of "no."
Republicans say they will gain $6.9 million over two years by no longer exempting coin and bullion transactions from the sales tax