A mixed bag: The Ohio 2018-2019 budget
Posted November 09, 2017 in Press Releases
Progress on drug epidemic, not enough revenue to meet needs
Ohio legislators forged the state’s 2018-2019 budget as revenue dropped and opioid deaths soared. In the midst of the drug epidemic, lawmakers scrambled to find money to stem it. In new analysis, Policy Matters Ohio finds that by and large, Ohio’s upside down tax system prevents it from raising enough money to meet the state’s needs.
Ohio’s overall operating budget for 2018-19 will be $132.8 billion, a 2.3 percent increase over the prior two-year period, adjusted for inflation. The budget included some positive developments in the fight against addiction. Lawmakers did not eliminate the Medicaid expansion - the primary tool to help the addicted - although some tried, and the threat lingers. Lawmakers funded services to stem the drug epidemic, but with one-time fixes, earmarked or redirected from other uses.
Lawmakers did not cut state income taxes, an important positive policy shift from previous budgets. However, they introduced new tax breaks and loopholes, which further drain resources needed for public services.
“While we applaud Ohio’s lawmakers for an aggressive approach in tackling the state’s drug epidemic, we won’t truly make progress without long-term sustainable revenue,” said Policy Matters Senior Project Director Wendy Patton. “That won’t happen until we close unproductive tax loopholes like the tax break for business income that’s costing Ohio $1 billion a year.”
Because lawmakers didn’t raise new revenue for the $200 million allocated for the drug epidemic, it comes at the expense of other important programs, like funding for local governments. Meanwhile, counties and transit agencies stand to lose due to chronic underfunding and changes to the state sales tax base. The budget also shortchanges K-12 education and public higher education. Important supports that help struggling Ohioans afford food and shelter are underfunded.
“For too long Ohio’s policymakers have cut taxes and given breaks to powerful interests on the promise of creating jobs and growing the economy,” Patton said. “Our growth lags the nation. If we really want a thriving community, we need to raise the revenue needed to invest in health care, education, transit and programs that make sure everyone’s basic needs are met.”