There are no markers for this video.
00:00:38>> AFTER A LONG COUPLE OF
MONTHS AND ONE VERY LONG DAY,
00:00:40LAWMAKERS PASS THE BUDGET.
AND TWO EXPERTS EXAMINE THE
00:00:43BUDGET - BOTH HOW IT SPENDS
MONEY AND HOW IT CHANGES KEY
00:00:46STATE POLICIES.
ALL THIS WEEK IN "THE STATE OF
00:00:47OHIO".
THE JOURNEY OF OHIO'S 62
00:00:54BILLION DOLLAR TWO YEAR STATE
BUDGET IS ALMOST OVER - AFTER
00:00:55SEVERAL MONTHS OF PUBLIC AND
PRIVATE WRANGLING, OFTEN AMONG
00:00:59MEMBERS OF THE REPUBLICAN PARTY.
THE BUDGET WAS FIRST INTRODUCED
00:01:04BY GOV.
JOHN KASICH ON FEBRUARY 4, AND
00:01:06IF ANYONE THOUGHT IT WOULD BE A
SIMPLE PROCESS SINCE HIS FELLOW
00:01:10REPUBLICANS DOMINATE THE HOUSE
AND SENATE, IT DIDN'T TAKE LONG
00:01:15FOR EVERYONE TO REALIZE THAT
WAS NOT GOING TO BE THE CASE.
00:01:16HOUSE REPUBLICANS STRIPPED OUT
KASICH'S LOWERING AND EXPANSION
00:01:22OF THE STATE SALES TAX ONTO
DOZENS OF SERVICES, HIS
00:01:24PROPOSED MEDICAID EXPANSION AND
HIS INCREASE IN THE TAX ON BIG
00:01:28OIL AND NATURAL GAS DRILLERS,
AND ALSO TOOK OUT HIS 50 PERCENT
00:01:31TAX CUT ON SMALL BUSINESSES AND
REPLACED HIS 20 PERCENT ACROSS
00:01:36THE BOARD INCOME TAX CUT WITH A
7 PERCENT INCOME TAX CUT.
00:01:37SENATE REPUBLICANS FOLLOWED
SUIT, BUT TOOK OUT THE HOUSE'S
00:01:43INCOME TAX CUT CHANGES AND PUT
BACK THE SMALL BUSINESS TAX CUT.
00:01:46THEN, JUST AFTER THE CONFERENCE
COMMITTEE HAD ITS FIRST MEETING
00:01:51TO HEAR UPDATED REVENUE AND
MEDICAID CASELOAD NUMBERS,
00:01:55SENATE AND HOUSE LEADERS
ANNOUNCED A DEAL TO BRING
00:01:57TOGETHER THOSE DUELING TAX CUTS
- A PHASED IN INCOME TAX CUT
00:02:00FOR EVERYONE OF 8.5% THE FIRST
YEAR, 9% THE SECOND YEAR AND 10%
00:02:02THE THIRD YEAR.
THE THIRD YEAR, BY THE WAY,
00:02:18WILL BE IN THE NEXT BUDGET
CYCLE.
00:02:19AND THE COMPROMISE BROUGHT BACK
THE 50% SMALL BUSINESS TAX CUT
00:02:20- A TOTAL, THE LEADERS SAID, OF
2.6 BILLION DOLLARS IN TAX CUTS.
00:02:21THE DEAL PAID FOR IT ALL WITH
AN INCREASE IN THE STATE SALES
00:02:23TAX FROM 5.5% TO 5.75% AND
EXPANDED IT TO DIGITAL DOWNLOADS
00:02:25AND MAGAZINE SUBSCRIPTIONS, AS
WELL AS ELIMINATING THE 12.5%
00:02:32ROLLBACK ON PROPERTY TAXES FOR
NEW SCHOOL LEVIES AND PROVIDED
00:02:36FOR MEANS TESTING FOR THE
HOMESTEAD TAX EXEMPTION FOR THE
00:02:39ELDERLY AND DISABLED.
THAT DEAL WENT TO THE
00:02:43CONFERENCE COMMITTEE, WHICH ON
TUESDAY AFTERNOON RELEASED ITS
00:02:45FINAL RECOMMENDATIONS FOR THE
BUDGET.
00:02:47LAWMAKERS GOT A DAY TO CONSIDER
THE RESOLUTION OF SOME 500
00:02:51DIFFERENCES IN THE TWO BUDGETS,
AS WELL AS SOME 100 NEW
00:02:54AMENDMENTS THAT WERE ADDED.
THAT LIST INCLUDED A PROVISION
00:02:57THAT WOULD REQUIRE A DOCTOR TO
INFORM A WOMAN SEEKING AN
00:03:00ABORTION OF THE PRESENCE OF A
FETAL HEARTBEAT BEFORE THE
00:03:03PROCEDURE CAN BE PERFORMED.
THAT'S VERY SIMILAR TO THE SO-
00:03:07CALLED HEARTBEAT BILL, WHICH
DIED IN THE GENERAL ASSEMBLY
00:03:09LAST YEAR AND HAS YET TO BE RE-
INTRODUCED, BUT IS A FAVORITE
00:03:13CAUSE OF MANY CONSERVATIVE
LAWMAKERS - SOME OF WHOM ALSO
00:03:16MIGHT HAVE BEEN CONCERNED ABOUT
THE SLIGHT INCREASE IN THE SALES
00:03:18TAX.
THEN ON BUDGET DECISION DAY -
00:03:22THURSDAY - A SLOW START FOR THE
HOUSE.
00:03:24THE SENATE WAS HALFWAY THROUGH
ITS DEBATE BEFORE HOUSE
00:03:28LAWMAKERS EVEN BEGAN, AND IT
WAS THOUGHT THERE MIGHT HAVE
00:03:31BEEN SOME VOTE-COUNTING GOING ON
AND HOLDING UP THE DEBATE.
00:03:34HERE ARE SOME HIGHLIGHTS OF THE
BUDGET DEBATE, FROM BOTH THE
00:03:36HOUSE AND THE SENATE.
>> THIS PLAN WILL PUT $2.7
00:03:45BILLION INTO THE OHIO ECONOMY
OVER THE NEXT THREE YEARS.
00:03:48THIS IS SIGNIFICANT PROGRESS OF
GROWTH.
00:03:51BETWEEN THE TAX CODE REFORMS,
THE CUTTING OF INDIVIDUAL
00:03:55INCOME-TAX RATES, AND THE
CUTTING OF SMALL-BUSINESS TAXES,
00:03:58WE ARE ACHIEVING PROGRESS FOR
ALL WORKING OHIOANS.
00:04:03IN FACT, MILLIONS OF MIDDLE-
CLASS OHIOANS ARE GOING TO GET
00:04:09AN INCOME TAX CUT.
>> FISCALLY IRRESPONSIBLE.
00:04:13HEARTLESS.
COWARDLY AND SHORTSIGHTED.
00:04:15JUST A FEW WORDS I WOULD USE TO
DESCRIBE THE ACTIONS, OR LACK
00:04:23THEREOF, THAT ARE DELINEATED IN
THE CONTENT OF THE CONFERENCE
00:04:26REPORT AS IT PERTAINS TO
MEDICAID.
00:04:31THE CONFERENCE REPORT CONTENT
REJECTS THE SIMPLE OPPORTUNITY
00:04:33TO RETURN TO CURRENT LAW AND
REFUSED TO REMOVE THE LANGUAGE
00:04:39THAT EXPLICITLY PROHIBITS
EXTENDING MEDICAID TO NEW
00:04:43BENEFICIARIES, MAINLY WORKING,
CHILDLESS ADULTS.
00:04:50>> THIS BUDGET IS NOT A
REFLECTION OF THE WHEEL OF THE
00:05:0011 MILLION OHIOANS.
IT IS THE ABSOLUTE
00:05:00PERSONIFICATION OF ABSOLUTE
POWER RUN AMOK.
00:05:01FOR THE WORKING CLASS OF THIS
STATE I URGE NO VOTE.
00:05:03FOR THE LOCAL COMMUNITIES OF
THIS STATE, I URGE NO VOTE.
00:05:07FOR THE WOMEN OF THIS STATE, I
URGE A NO VOTE.
00:05:11FOR THE CHILDREN OF THIS STATE,
I URGE A NO VOTE.
00:05:15I WOULD KINDLY ASK THAT THE
MEMBERS OF THIS BODY GROW A
00:05:20PAIR OF OVARIES OR OTHERWISE.
I HEARD A NO VOTE ON THIS BILL.
00:05:26[APPLAUSE]
>> NOBODY GOT EVERYTHING THEY
00:05:31WANT.
IF THEY DID, YOU CAN STAND UP
00:05:35AND SAY, I DID.
I HAVE NOT HEARD ANYBODY WHO
00:05:39DID.
SO THAT BRINGS ME TO POINT
00:05:41NUMBER TWO.
MY COLLEAGUES ARE IN THE
00:05:45SOMEWHAT OF AN ENVIABLE POSITION
AS PART OF THE MINORITY OF
00:05:49EXPRESSING THEIR DEEP
DISAPPOINTMENT, FRUSTRATION, AND
00:05:53EVEN ANGER, OVER A BUDGET THAT,
IN MY SEVEN BIENNIAL BUDGETS, IS
00:06:00THE BEST BUDGET I HAVE SEEN IN
13 YEARS.
00:06:02IT IS A BUDGET THAT GIVES TAX
CUTS TO 98.5% OF THE TAXPAYERS
00:06:10IN OHIO.
SO IF YOU ARE DISAPPOINTED,
00:06:15OUTRAGED, ANGRY, FRUSTRATED OVER
THE TAX CUTS, WELL, YOU ARE
00:06:20SPEAKING FOR 1.5% OF THE OHIO
POPULATION.
00:06:24I WILL TAKE A 98.5%.
I AM NOT A PARTICULARLY POLL-
00:06:32DRIVEN PERSON, BUT 90%, I WILL
GO WITH THEM.
00:06:36>> I ONLY LIKE THIS BUDGET
BECAUSE I HAVE TWO AREAS OF
00:06:39CONCERN IN THE BUDGET.
THE FIRST AREA OF CONCERN IS
00:06:43THAT THERE IS WAY TOO MUCH
POLICY IN IT.
00:06:45THERE ARE THINGS IN THIS BUDGET
THAT I FEEL SHOULD NOT BE IN
00:06:49THIS BUDGET.
THERE ARE BILLS THAT WE PASSED
00:06:52OVER TO THE SENATE, AND RATHER
THAN THEM BOATING AND VETTING
00:06:58THAT, THE BUDGET COME BACK TO US
AND THE BILLS ARE IN THERE.
00:07:03THAT IS NOT THE WAY TO VET
POLICY, NOT THE WAY TO GET
00:07:08THINGS DONE.
>> THIS ABSOLUTELY SHIFTS THE
00:07:11TAX BURDEN IN THE STATE OF OHIO.
THIS IS A BUDGET THAT CREATES A
00:07:16MORE REGRESSIVE TAX SYSTEM IN
THE STATE OF OHIO.
00:07:19WE'RE INCREASING THE SALES TAX,
SALES TAX IS PAID BY EVERYBODY
00:07:24IN THE STATE OF OHIO, BUT IT
AFFECTS THE POOREST AND MIDDLE-
00:07:28CLASS MORE THAN DOES THE
WEALTHIEST AMONG US.
00:07:30AND IT IS DECREASING THE INCOME
TAX.
00:07:33IF YOU DO ACROSS-THE-BOARD
INCOME-TAX REDUCTIONS, THAT
00:07:38AFFECTS THE WEALTHIEST THE MOST,
SO THAT THEY HAVE LESS IN TAXES
00:07:42THEY HAVE TO PAY COMPARED TO
THOSE THAT HAVE THE LEAST.
00:07:44>> IT IS RARE, IN THE LONG
HISTORY I HAVE BEEN ABLE TO
00:07:50SERVE HERE, TO STAND FOR A
BUDGET THAT SETS UP SO MUCH GOOD
00:07:56TAX POLICY IN THIS STATE, AND
TAXES, THAT WILL LEAD US
00:08:01FORWARD.
A LOT OF PEOPLE SAY IF WE DO NOT
00:08:04CUT TAXES, THIS HAPPENS.
IF WE DO CUT TAXES, THAT
00:08:09HAPPENS.
I HAVE A MORE SIMPLISTIC VIEW OF
00:08:11CUTTING TAXES.
WHEN THE GOVERNMENT HAS LOTS OF
00:08:15MY OR MY CONSTITUENTS' MONEY, WE
HAVE MORE FREEDOM.
00:08:17-- LESS OF MY OR MY
CONSTITUENTS' MONEY, WE HAVE
00:08:23MORE FREEDOM.
I THINK THERE IS A CORRELATION
00:08:26BETWEEN THE GOVERNMENT TAKING
LESS OF MY MONEY AND MORE
00:08:30FREEDOM, AND WE HAVE MORE
FREEDOM WHEN THEY TAKE US OF OUR
00:08:33MONEY.
>> THIS BUDGET PUTS THE
00:08:36GOVERNMENT BETWEEN A WOMAN AND
HER PHYSICIAN.
00:08:37I UNDERSTAND WHY YOU DO NOT WANT
TO TALK ABOUT THAT.
00:08:44AND FOR MIDDLE-CLASS OHIOANS,
THIS BUDGET IS TERRIBLE.
00:08:53FOR MIDDLE-CLASS OHIOANS, IT
WILL MAKE IT HARDER TO PASS
00:09:00SCHOOL LEVIES.
FOR MIDDLE-CLASS OHIOANS, THIS
00:09:04MAINTAINS CUTS TO EDUCATION.
FOR MIDDLE-CLASS OHIOANS, THIS
00:09:09MAINTAINS CUTS TO LOCAL POLICE
AND LOCAL FIRE.
00:09:11SO I UNDERSTAND WHY THESE
TALKING POINTS DO NOT TALK ABOUT
00:09:19THIS BUDGET.
AND YOU KNOW WHAT?
00:09:21IF I WAS PROMOTING THIS BUDGET,
I WOULD NOT TALK ABOUT IT
00:09:24EITHER.
>> IN THE END, THE ONLY
00:09:27FIREWORKS WERE IN THE SENATE,
WHEN ABORTION RIGHTS ACTIVISTS
00:09:29WHO HAD PROTESTED THE ABORTION
MEASURES IN THE BUDGET EARLIER
00:09:31IN THE DAY SHOUTED "SHAME ON
YOU" AFTER THE BUDGET PASSED,
00:09:34AND WERE FORCIBLY REMOVED FROM
THE CHAMBER.
00:09:35THEN IN THE HOUSE, REP. RON
AMSTUTZ HEARKENED BACK TO A
00:09:40BIBLE VERSE THAT WAS USED BY
DEMOCRAT MIKE FOLEY TO WHAT HE
00:09:44SAID WAS A TAX SHIFT THAT
CREATES A BURDEN ON THE POOREST
00:09:47AND THE WORKING MIDDLE CLASS.
>> "I WAS DISAPPOINTED WHEN THE
00:09:53REFERENCE TO THE LEAST OF THESE
- AT LEAST AS I SEE IT - WAS
00:10:00MISINTERPRETED
BECAUSE WHO WOULD THE LEAST OF
00:10:10THESE BE BUT AN UNBORN CHILD?
WHY IS IT THAT THEY HAVE TO BE
00:10:17THE VICTIMS?
>> FOLEY HAD REPLACED VERNON
00:10:18SYKES ON THE CONFERENCE
COMMITTEE BECAUSE OF A POSSIBLE
00:10:20CONFLICT OF INTEREST WITH A CO-
OP INTERNSHIP PROGRAM.
00:10:22FOLEY THEN ROSE TO TAKE ISSUE
WITH AMSTUTZ'S COMMENTS THAT
00:10:25DEMOCRATS DIDN'T OFFER
ALTERNATIVES TO THE BUDGET.
00:10:29>> WE HAD OVER 200, 250
AMENDMENTS
00:10:31INTO THIS BUDGET PROPOSAL THAT
THE WHAT HEALTH CARE, EDUCATION,
00:10:39TAX CHANGES, ROADS AND BRIDGES,
LOCAL GOVERNMENT FUND DOLLARS,
00:10:44TO SAY THAT THE DEMOCRATS DID
NOT HAVE AN ALTERNATIVE THAT WAS
00:10:47PROPOSED INTO THE BODY POLITIC
HERE IT IS JUST THE DISINGENUOUS
00:10:52AND I WOULD OBJECT
>> AND REP. LYNN WACHTMANN STOOD
00:10:57UP TO SAY FOLEY WAS OUT OF
ORDER.
00:10:58SPEAKER BILL BATCHELDER
IMMEDIATELY CALLED FOR A VOTE.
00:11:01THE FINAL WAS 51-43.
REPUBLICANS JOHN ADAMS OF
00:11:04SIDNEY, JOHN BECKER OF
CINCINNATI, RON HOOD OF
00:11:06ASHVILLE, MATT LYNCH OF SOLON,
ROSS MCGREGOR OF SPRINGFIELD,
00:11:09KRISTINA ROEGNER OF HUDSON AND
RON YOUNG OF LEROY WERE THE
00:11:11REPUBLICANS WHO VOTED AGAINST
THE BUDGET, ALONG WITH ALL
00:11:14DEMOCRATS PRESENT FOR THE VOTE.
THE FINAL VOTE IN THE SENATE
00:11:17WAS 21-11, WITH REPUBLICAN KRIS
JORDAN OF POWELL BREAKING WITH
00:11:22THE GOP AND JOINING ALL SENATE
DEMOCRATS IN VOTING AGAINST THE
00:11:24BUDGET.
IN THE HOUSE, ON FRIDAY, GOV.
00:11:28KASICH HELD A NEWS CONFERENCE
WITH SPEAKER BATCHELDER AND
00:11:31PRESIDENT FABER TO GO OVER THE
BUDGET - A SUGGESTION THAT THE
00:11:37THREE LEADERS HAD STAYED CLOSE
THROUGHOUT THE PROCESS, THOUGH
00:11:52KASICH'S ORIGINAL BUDGET
PROPOSAL WAS HEAVILY EDITED AND
00:11:53SOME OF HIS KEY PROGRAMS WERE
STRIPPED FROM IT BY BATCHELDER
00:12:03AND FABER.
IT'S EXPECTED GOV. KASICH WILL
00:12:04SIGN THE BUDGET ON SUNDAY.
ALSO ON BUDGET DAY - HOUSE
00:12:05DEMOCRATS ANNOUNCED THEY'LL TRY
A TECHNICAL TRICK TO PUSH
00:12:06FORWARD REPUBLICAN BARBARA
SEARS' BILL TO EXPAND MEDICAID.
00:12:07THEY SAY THEY'VE PULLED A
DISCHARGE PETITION TO FORCE A
00:12:08VOTE ON THE BILL, BUT THEY NEED
ALL DEMOCRATS AND 11
00:12:09REPUBLICANS TO SIGN ONTO IT FOR
IT TO GO TO THE FLOOR.
00:12:10THEY SAY THEY'RE LEANING ON GOV.
KASICH TO PERSUADE MEMBERSTHEY A
00:12:12DISCHARGE PETITION TO FORCE A
VOTE ON THE BILL, BUT THEY NEED
00:12:13ALL DEMOCRATS AND 11
REPUBLICANS TO SIGN ONTO IT FOR
00:12:14IT TO GO TO THE FLOOR.
THEY SAY THEY'RE LEANING ON GOV.
00:12:16KASICH TO PERSUADE MEMBERS OF
THE REPUBLICAN CAUCUS TO SIGN
00:12:17ONTO IT AS WELL.
TO DIG MORE DEEPLY INTO THE
00:12:18SPENDING AND POLICY IN THIS
BUDGET, I'VE INVITED TWO
00:12:19EXPERTS WHO HAVE BEEN WATCHING
THE PROCESS FROM DIFFERENT
00:12:20PERSPECTIVES.
JON HONECK IS WITH THE CENTER
00:12:21FOR COMMUNITY SOLUTIONS, A
PROGRESSIVE-LEANING RESEARCH
00:12:22GROUP DEALING WITH FISCAL,
HEALTH, SOCIAL AND ECONOMIC
00:12:25POLICY.
GREG LAWSON IS A POLICY ANALYST
00:12:27FOR THE CONSERVATIVE BUCKEYE
INSTITUTE, WHICH DESCRIBES
00:12:30ITSELF AS A FREE-MARKET THINK
TANK.
00:12:31THAT THE ASK YOU BOTH ABOUT YOUR
INITIAL REACTION TO THE PROPOSAL
00:12:37BUT CAME OUT THAT SOUGHT TO
BRING TOGETHER THESE DUELING TAX
00:12:40CUTS IN THE HOUSE AND SENATE
VERSIONS OF THE BUDGET.
00:12:42THIS ONE RAISES THE STATE TELLS
TAX, EXPANSION ON DIGITAL
00:12:48DOWNLOAD AND MAGAZINE
SUBSCRIPTIONS, ELIMINATION OF
00:12:51THE ROLL BACK ON THEIR PROPERTY
LEVIES, AND NEW STANDARDS FOR
00:12:56THE HOMESTEAD TAX.
JON?
00:12:59>> I THINK IT IS A MIXED BAG.
SOME ELEMENTS WERE GOOD, SOME
00:13:05WERE DISAPPOINTING.
IT IS IMPORTANT TO BACK UP AND
00:13:08LOOK AT THE BIG PICTURE.
THE STATE ENDING 2014 WITH A
00:13:13PROBABLY $2 BILLION SURPLUS.
SOME OF THE ISSUE IS WHAT YOU DO
00:13:17IN THAT CIRCUMSTANCE.
YOU COULD DO THREE THINGS.
00:13:18INCREASE MONEY GOING TO
PROGRAMS, PUT MONEY IN THE RAINY
00:13:22DAY FUND, YOU SOME OF THE MONEY
FOR TAX CUTS.
00:13:25IT SEEMS TO ME THE BIGGEST
PRIORITY, A MAJORITY IN THE
00:13:30HOUSE AND SENATE WAS TO USE THAT
MONEY FOR TAX CUTS.
00:13:32WITH PRAYER GOVERNORS AND
GENERAL ASSEMBLY'S, YOU MAY HAVE
00:13:38SEEN MORE OF A BALANCE BETWEEN
PUTTING MONEY IN THE RAINY DAY
00:13:40FUND, MORE INTO PROGRAMS, BUT IT
IS ABSOLUTELY CLEAR THE MONEY
00:13:48GOES FOR A TAX CUT, AND AS A
PERMANENT, SO WHETHER OR NOT THE
00:13:50STATE HAS A SURPLUS TWO YEARS
FROM NOW, FOUR YEARS FROM NOW,
00:14:00THOSE TAX CUTS WILL GO FORWARD.
THAT IS THE BURSTING TO KNOW,
00:14:01THERE IS A REVENUE LOSS FOR THE
STATE DOWN THE ROAD.
00:14:02>> GREG, YOUR INITIAL REACTIONS?
>> I WOULD AGREE IT IS A MIXED
00:14:06BAG.
THERE SEEMS TO BE THINGS IN
00:14:10THERE THAT ARE PRETTY DARN GOOD,
THINGS THAT WE'RE NOT QUITE AS
00:14:13THRILLED ABOUT.
THE BOTTOM LINE IS, THE BUCKEYE
00:14:16INSTITUTE HAS BEEN LOOKING AT
TAX ISSUES FOR A LONG TIME.
00:14:19WE THINK THE TAX STRUCTURE IN
OHIO AT THE STATE AND LOCAL
00:14:22LEVEL ARE VERY CUMBERSOME AND
PROBLEMATIC.
00:14:27THEY ARE RELATIVELY HIGH, NOT
POSITIVE FOR LONG-TERM ECONOMIC
00:14:30GROWTH.
WE HAVE SEEN A HISTORY OF A HIGH
00:14:33OF NOT DOING AS WELL AS OTHER
STATES.
00:14:34THE CUTTING OF THE INCOME TAX IS
A GOOD THING.
00:14:38FRANKLY, WE WOULD TAKE THE
POSITION THAT IT IS GOOD TO SEE
00:14:41A SHIP FROM INCOME TO A
CONSUMPTION-BASED TAXES.
00:14:44THE ONE THING THAT IS
PROBLEMATIC, THOUGH, IT IS A 10%
00:14:51CUT FULLY WHEN IT IS PHASED IN.
BUT WE WOULD LIKE TO SEE THAT
00:14:58THE LARGER, FRANKLY, WITH AN
INCREASE IN THE SALES TAX, THAT
00:15:02WILL JUST PUT US HIGHER THAN
WHEN YOU FACTOR IN LOCAL SALES
00:15:05TAXES, HIGHER THAN ANY OF OUR
CONTINUOUS NEIGHBORS ON THE
00:15:10SALES TAX ISSUE.
IF WE ARE DOING THAT, WE WOULD
00:15:14PREFER TO SEE A BIGGER POT ON
THE INCOME TAX.
00:15:16WE ARE HAPPY IT IS GOING IN A
GOOD DIRECTION, BUT WE ARE A
00:15:21LITTLE DISAPPOINTED THAT IT IS
NOT ABLE TO BE MORE.
00:15:24>> LET ME TALK WITH YOU ABOUT
THE TAX REFORM PART WITH REGARD
00:15:31TO THE SALES TAX.
GREGG, POLICY MATTERS IN OHIO
00:15:33HAS SAID THAT THE PLAN WOULD CUT
TAXES ON THE STATE'S MOST
00:15:36AFFLUENT PEOPLE, THE TOP 1%, BY
$6,000, AND WOULD ALSO HAVE THE
00:15:42BOTTOM PAYING SLIGHTLY MORE.
HOW CAN YOU DEFEND THAT?
00:15:47>> THERE HAVE BEEN SOME THINGS
IN HERE -- DEFENDING SOME OF
00:15:52THAT.
THE EARNED INCOME TAX CREDIT,
00:15:56THAT WAS PUT IN THERE TO ADDRESS
SOME OF THESE CONCERNS ABOUT
00:16:00REGRESSIVE IN THE ITY.OD SET
OHIO HAS HAD A REST -- ROUGH
00:16:13DECADE.
WE LOST MORE PRIVATE-SECTOR JOBS
00:16:25THAN ANY OTHER STATE IN THE
COUNTRY OVER SIX AND A THOUSAND.
00:16:26WE NEED TO DO THINGS
DIFFERENTLY.
00:16:27WE THINK, OVER TIME, SHIFTING
AWAY FROM INCOME TAXATION WILL
00:16:28CREATE AN INCENTIVE FOR MOREWE T
BUSINESSES.
00:16:29THE OTHER THING, IT IS MORE THAN
THAT 10% CUT.
00:16:30THERE IS CONTROVERSY OVER IT BUT
THERE IS THE SMALL BUSINESS TAX
00:16:36CUT, THE DEDUCTION UP TO
$250,000.
00:16:39THIS IS NOT ENOUGH, BY THE WAY.
THIS WILL NOT GET US AS FAR AS
00:16:44WE NEED TO GO, THERE IS MORE TO
BE DONE, BUT THIS IS A STEP IN
00:16:48THE DIRECTION TO GET OHIO'S
ECONOMY MOVING.
00:16:52WE THINK THESE POLICIES WILL,
OVER TIME, MOVE US IN THAT
00:16:59DIRECTION.
THAT IS HOW I WOULD DEFEND IT,
00:17:00GETTING PEOPLE TO WORK.
>> JON, I WILL ASK YOU ABOUT
00:17:07WHAT HE SAID, AS WELL,
CONSERVATIVE ECONOMISTS SAYING
00:17:20LOW INCOME TAX STATES INCURRED
POPULATION GROWTH.
00:17:21OTHERS SAY THAT, AS ALSO ENCOUR.
ISN'T THIS WHAT WE WANT TO HAVE
00:17:25MORE REVENUE COMING IN?
>> HIGHER SALES
00:17:27TAXES IT IS UNFORTUNATE THAT
SOMETIMES EVERY SOCIAL AND
00:17:30ECONOMIC ILLS THAT HAS HAPPENED
IN THE STATE IN THE LAST 40
00:17:33YEARS IT'S PLAYED AT THE FEET OF
THE INCOME TAX.
00:17:35THERE ARE 40 STATES THAT HAVE
INCOME TAX, SOME ARE DOING WELL,
00:17:39SOME ARE NOT.
WHAT IS STRANGE ABOUT THIS
00:17:42BUDGET, WE COME OUT OF IT WITH A
SMALL SALES TAX INCREASE, EVEN
00:17:47THOUGH AT THE BEGINNING OF THE
PROCESS, THE GOVERNOR PROPOSED
00:17:51BROADENING THE SALES TAX BASE
AND LOWERING THE RATE.
00:17:54BUT BECAUSE OF THE DESIRED TO DO
SO MUCH ON THE INCOME TAX SIDE,
00:17:59YOU END UP DOING SOMETHING WHICH
IS REGRESSIVE.
00:18:04EVERYONE ADMITS THAT FOR LOW-
INCOME PEOPLE.
00:18:06THE EARNED INCOME TAX CREDIT IS
A NIGHT MOVE -- NICE MOVE, BUT
00:18:10BECAUSE IT IS NOT REFUNDABLE,
PEOPLE DO NOT GET THAT MONEY
00:18:15BACK, IT LIMITS ITS USEFULNESS
FOR LOW-INCOME PEOPLE.
00:18:18THEY HAVE DONE SOME INTERESTING
THINGS ON THE PROPERTY TAX SIDE,
00:18:23BUT WITH THE ROLLBACKS AND SOME
OF THE OTHER, HOMESTEAD TAX
00:18:28CREDITS FOR THE ELDERLY, -- MY
FEELING ABOUT IT IS, IT DID NOT
00:18:34CREATE A MORE RATIONAL TAX
SYSTEM.
00:18:35BUT THEY GIVE YOU AN EXAMPLE.
SMALL BUSINESS DEDUCTION IS
00:18:40BASICALLY A LOOPHOLE.
YOU CAN DEDUCT 50% OF YOUR
00:18:44INCOME SO IT IS SHIELDED FROM
THE TAX DEPARTMENT BASICALLY
00:18:47WITHOUT HAVING TO DO ANYTHING.
THERE IS NO PROMISE THAT ANYONE
00:18:51WILL INVEST ANYTHING.
JUST HOPING THAT THINGS ARE
00:18:54GOING TO HAPPEN.
ON THE OTHER HAND, THEY DID
00:18:58CLOSE A LOOPHOLE FOR GAMBLING
LOSSES, WHICH I THINK -- BRINGS
00:19:03A SMILE TO THEIR FACE.
WHY ARE WE DOING THAT?
00:19:05THAT WAS EASIER TO CLOSE BECAUSE
THIS WOULD HAVE BEEN THE FIRST
00:19:08YEAR THAT PEOPLE COULD HAVE
USED THAT DEDUCTION.
00:19:11IT HAS NOT REALLY HIT THE STREET
YET.
00:19:14DOING THAT IS A BIT EASIER.
THE CLOSE THE SALES TAX LOOPHOLE
00:19:18FOR MAGAZINE SUBSCRIPTIONS
BOUGHT FROM THE PUBLISHER.
00:19:21THAT IS WELL AND GOOD, BUT THERE
ARE OTHER TAX LOOPHOLES THAT
00:19:24WERE OPENED.
RESEARCH AND DEVELOPMENT FOR
00:19:29AEROSPACE VEHICLES, VARIOUS
THINGS ON THE SALES TAX SIDE.
00:19:33>> A WHOLE LIST THAT GOVERNOR
KASICH HAD PROPOSED THAT WOULD
00:19:36HAVE EXPANDED THE SALES TAX ON
VARIOUS SERVICES.
00:19:40>> YES, SO TO COME OUT OF THIS
WITH LESS OVERALL REVENUES,
00:19:45SALES TAX INCREASE, I THINK, IS
PROBLEMATIC.
00:19:49>> GRANDE, IF WHAT YOU SAID WAS
TRUE ABOUT TAX CUTS, WOULD AND
00:19:53WE HAVE SEEN SOME OF THOSE
ATTACKS AFTER THE 2005 TAX CUTS,
00:19:58THE BIG PACKAGE THAT WE SAW
PHASED IN BACK THEN?
00:19:59>> ORGANIZATIONS HAVE BROUGHT UP
THAT ARGUMENT.
00:20:05FIRST OF ALL, YOU NEVER KNOW
WHAT WOULD HAVE HAPPENED ABSENT
00:20:10THAT.
LET'S MAKE IT CLEAR, TAX CUTS IS
00:20:12NOT THE ONLY THING.
OHIO HAS CHALLENGES WITH LABOR
00:20:16POLICY AND OTHER THINGS THAT ARE
PROBLEMATIC.
00:20:17THIS IS NOT BEING ADDRESSED IN
THE BUDGET AND THERE IS ANOTHER
00:20:22PIECE OF LEGISLATION OUT THERE
THAT IS IMPORTANT, INCOME TAX
00:20:25UNIFORMITY.
ONE THING THAT IS FORGOTTEN IN
00:20:29THIS STATE IS HOW COMPLICATED
AND CUMBERSOME THAT ISSUE IS.
00:20:31IT IS NOT A REAL SEXY ISSUE
BECAUSE IT IS COMPLICATED AND
00:20:37DIFFICULT, PEOPLE DO NOT THINK
ABOUT IT ALL THAT MUCH AS YOU DO
00:20:41INCOME TAX OR SALES TAX.
THESE ARE VERY SERIOUS PROBLEM
00:20:47THAT OHIO HAS.
WE HAVE NOT YET TACKLED IT.
00:20:47TO ANSWER THE QUESTION, I THINK
THAT WAS A MOVE IN THE RIGHT
00:20:52DIRECTION IN 2005.
THIS IS A CONTINUED MOVE IN THAT
00:20:56DIRECTION, BUT WE CANNOT STAND
UP ON THE MOUNTAINSIDE AND DO A
00:21:00BUNCH OF TEST DUMPING BECAUSE
THERE IS A LOT MORE THAT NEEDS
00:21:03TO BE DONE.
THAT IS THE KEY.
00:21:06THESE ARE TENTATIVE STEPS BUT WE
HAVE GOT TO DO MORE IN A NUMBER
00:21:11OF DIFFERENT AREAS TO MOVE WAS
IN THE DIRECTION WE NEED TO GO.
00:21:15OHIO HAS YET TO FULLY SHAKE OFF
ITS HISTORICAL RUST BELT
00:21:19MENTALITY, AND UNTIL WE DO THAT,
WE ARE NOT GOING TO GET WHERE WE
00:21:24NEED TO GO.
FRANKLY, THE GOVERNOR'S INITIAL
00:21:27PROPOSAL, AN EXPANSION OF THE
BASE.
00:21:28THAT IS THE MOST RATIONAL
SYSTEM, AND THAT IS HOW WE WOULD
00:21:38AGREE.
AS WE DO THAT, WE WANT TO MAKE
00:21:40SURE THAT WE GET A BANG FOR THE
BUCK ON THE INCOME TAX SIDE.
00:21:44WE TAX EVERYTHING IN OHIO.
WE HAVE INCOME TAX, SALES TAX,
00:21:50PROPERTY TAX, COMMERCIAL
ACTIVITY TAX, KIND OF LIKE A
00:21:54VALUE ADDED TAX.
A LOT OF STATES DO NOT DO ALL
00:21:58THESE THINGS.
WHAT WE SEEM TO BE FINDING IS WE
00:22:01HAVE NOT MANAGED TO GET RUN IT
ONE OF THESE THINGS SO THAT WE
00:22:03CAN FOCUS ON THAT FUNDAMENTAL
REFORM.
00:22:08THERE IS MOVEMENT, IT NEEDS TO
CONTINUE TO GO.
00:22:10>> ONE THING WE SHOULD BRING UP
SINCE WE'RE AT THE END OF THE
00:22:15PROCESS, THE GOVERNOR MADE A
PUSH AT THE BEGINNING OR
00:22:17SEVERANCE TAXES ON FRACKING
HORIZONTAL WELLS, OIL AND GAS,
00:22:24AND THE RATES THAT HE PROPOSED
WERE ACTUALLY FAIRLY LOW WITH
00:22:28RESPECT TO OTHER STATES.
THE LEGISLATURE STILL TOOK A
00:22:31PASS.
IT IS ALMOST INEXPLICABLE.
00:22:35IF YOU LOOK OF SOME OF THE
WESTERN STATES, PLAINS STATES,
00:22:39NORTH DAKOTA, THEY ARE BOOMING.
THEY ARE BOOMING BECAUSE THE OIL
00:22:47IS IN THE GROUND AND THEY HAVE A
SEVERANCE TAX THAT IS FAIRLY
00:22:48HIGH.
IT IS MIND-BOGGLING TO ME THAT
00:22:49THE LEGISLATURE TOOK A PASS ON
THAT.
00:22:50>> I KNOW NEITHER OF YOU HAVE A
CRYSTAL BALL, BUT I WANT TO ASK
00:22:58YOU ABOUT LINE-ITEM VETO.
THAT IS SOMETHING THAT IS OUT
00:23:02THERE THAT THE GOVERNOR COULD BE
LOOKING TO.
00:23:05ANYTHING THAT HAS RAISED A FLAG
FOR YOU AS YOU LOOK AT THE
00:23:07BUDGET THAT IT MIGHT BE
SOMETHING THAT HE WOULD CROSS
00:23:10OUT?
JON?
00:23:12>> THEY DID GO BACK TO SOME OF
HIS ORIGINAL ISSUES, PROPOSALS,
00:23:20I GUESS IS THE RIGHT WORD, WITH
REGARD TO NURSING-HOME.
00:23:24UNDER THIS NEW PROPOSAL, NURSING
FACILITIES WOULD END UP ON A
00:23:31FEDERAL LIST OF BAD NURSING
HOMES, THE STATE COULD, IF THEY
00:23:37DO NOT IMPROVE OVER A PERIOD OF
TIME, COULD REVOKE THEIR
00:23:40LICENSE.
THAT IS A GOOD THING.
00:23:42THEY HAVE GONE BACK TO THE
EXECUTIVE ON THAT AND OTHER
00:23:45NURSING HOME-RELATED THINGS.
THERE IS STILL A $30 MILLION
00:23:49BONUS FOR NURSING HOMES IN THE
BUDGET.
00:23:50THE GOVERNOR DID VETO ALMOST
EXACT SAME PROVISION IN THE
00:23:57BIENNIUM REVIEW LAST YEAR.
I WOULD SAY THAT WHEN BEEN --
00:24:01THAT WOULD BE AT THE TOP OF THE
LIST FOR THE ADMINISTRATION.
00:24:04>> I THING THAT IS A LIKELY
TARGET.
00:24:06ONE OF THE THINGS IS THE
PROHIBITIONS.
00:24:09WE HAVE NOT TALKED ABOUT
MEDICAID EXPANSION BECAUSE IT
00:24:12WAS PULLED OUT OF THE BUDGET.
THERE WAS AN INTERESTING PIECE
00:24:16THAT I READ OVER THE WEEKEND,
WHERE THE IDEA WAS FLOATED THAT
00:24:20THE GOVERNOR MAY LINE ITEM SOME
OF THE RESTRICTIONS THERE.
00:24:22OBVIOUSLY, WE DO NOT KNOW THAT
WILL BE THE CASE, BUT THERE IS
00:24:27SEPARATE LEGISLATION WORKING ON
THIS ENTIRE ISSUE, WHICH IS
00:24:32EXTRAORDINARILY COMPLICATED, BUT
IT IS NOW OUTSIDE THE CONFINES
00:24:34OF THE BUDGET.
ONE THING THAT COULD HAPPEN IS,
00:24:39WE THINK THERE IS A BIT OF AN
ARTIFICIAL DEADLINE THAT PEOPLE
00:24:43ARE TRYING TO SET IN TERMS OF
GETTING THINGS DONE.
00:24:48WE THINK THERE IS A BED OF
DISINGENUOUS THIS THERE.
00:24:52IT IS POSSIBLE THAT THAT COULD
BE ONE OF THE LINE ITEM SO THAT
00:24:56THERE COULD STILL BE
ADMINISTERED WORK.
00:24:58YOU COULD NOT BRING PEOPLE INTO
THE PROGRAM, BUT YOU COULD DO A
00:25:02LOT OF BACK ROOM STUFFED WITH
COMPUTERS AND TECHNOLOGY TO
00:25:06PREPARE THE WAY FOR THE
POTENTIAL EXPANSION.
00:25:07GIVEN THE GOVERNOR SEEMS TO BE
ADAMANT IN HIS APPROACH TO THAT
00:25:12PARTICULAR ISSUE, THAT WOULD NOT
SURPRISE ME.
00:25:15>> I WANT TO BREAK RIGHT NOW AND
THEN COME BACK TO MEDICAID
00:25:21EXPANSION AND SEVERANCE TAX.
THANK YOU VERY MUCH FOR BEING
00:25:24HERE.
>> AND THAT'S IT FOR THIS WEEK.
00:25:26FOR MY COLLEAGUES AT OHIO PUBLIC
RADIO AND TELEVISION, THANKS FOR
00:25:29WATCHING.
IF YOU'D LIKE TO ASK QUESTIONS,
00:25:31MAKE COMMENTS, OR WATCH THIS
WEEK'S SHOW OR EARLIER EPISODES,
00:25:34PLEASE VISIT OUR WEBSITE AT
STATENEWS.ORG.
00:25:35YOU CAN ALSO CHECK US OUT ON
FACEBOOK, AND YOU CAN FOLLOW JO
00:25:39INGLES AND ME ON TWITTER.
AND PLEASE JOIN US AGAIN NEXT
00:25:46TIME FOR "THE STATE OF OHIO."
CAPTIONED BY THE
00:26:28NATIONAL CAPTIONING INSTITUTE
--WWW.NCICAP.ORG--
Note : Transcripts are compiled from uncorrected captions