The House Finance and Appropriations Committee unveiled its version of the operating budget bill on Tuesday, April 9, 2013, in a substitute version of House Bill 59.  The biggest change included in the new bill is the removal of virtually all of Governor John Kasich’s proposed tax reforms — including the broadening of the sales tax base to include services, the small business tax deduction and the increased severance tax.  It does however include an across-the-board income tax reduction of 7 percent to all tax brackets.  The tax reduction is being paid for with current revenue growth, including the $500 million payment just received from JobsOhio for the liquor revenue stream.  Representative Ron Amstutz (R-Wooster), chair of the committee, did note that the House and Senate intend to continue working on tax reform for the next several months with the hope of having a modified proposal ready for inclusion during the conference committee process in June. 

The other big change in the substitute bill was the removal of the proposed Medicaid expansion to cover the working poor — adults making less than 138 percent  of the federal poverty level.  Despite the support of the governor and dozens of witnesses from around the state, House Republicans have been very vocal about their opposition to the expansion, which depended on federal dollars for funding.  In all, approximately 30 proposals were removed from the bill.  Representative Amstutz said that some of the provisions might end up in other bills as the members believed they required more in-depth discussion than the budget process allows. 

The committee will be taking public testimony on the substitute version of the bill on Wednesday, April 10; Thursday, April 11, and Friday, April 12; with final amendments due to the chair’s office by 5:00 p.m. Friday.  The committee will reconvene Tuesday, April 16, to address any last amendments and to vote on the bill.  A floor vote on the bill is expected Thursday, April 18.

The Senate has already announced that the Senate Finance Committee will begin informal hearings on the bill starting on Tuesday, April 16.  Also for the first time in recent history, the committee will break into subcommittees to consider different portions of the bill, including panels on Education, General Government and Medicaid, along with a panel of the Senate Ways & Means Committee for tax matters.  The Senate currently anticipates introducing a substitute bill on May 28 and holding a floor vote by June 5; leaving three and a half weeks for a conference committee to harmonize the bills.  The Governor must sign a final bill by the end of the current fiscal year, June 30, 2013.