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Ohio Senate Passes State's New Two-Year Budget Plan

Budget provides record tax relief and education options for families
June 30, 2023
Matt Huffman News

COLUMBUS—Building on the strong foundation of the Senate’s tax relief package, the Senate and House worked to expand it even more in the final version of HB 33, the state’s new two-year $86.1 billion operating budget.
“Ohioans work hard for every dollar they make,” said Senate President Matt Huffman (R-Lima). “Our job is to make sure they keep more of it, and spend only what is absolutely necessary, and that is exactly what this budget does.”

The budget maintained the tax relief package totaling $3 billion while also reducing the overall number of income tax brackets to only two.
The marginal income tax rates will be 2.75% over $26,050 and 3.5% over $100.000.

“Eight years ago, there were nine tax brackets in Ohio,” said Senate Finance Chair Matt Dolan (R-Chagrin Falls). “Now there will be only two, and anyone making less $26,051 will pay zero income taxes.”
The budget also recognizes the vital role small businesses play in Ohio’s economy.
It invests substantial tax relief for businesses with significant reforms to the Commercial Activity Tax. Businesses will pay no taxes on the first $3 million of gross receipts in the first year of the budget, and will pay no taxes on the first $6 million of gross receipts in the second year of the budget.
“Consumer spending drives two-thirds of the economy, and small businesses are the backbone of Ohio’s success,” said Senator Dolan.
With that in mind, Ohioans will enjoy an expanded sales tax holiday that will last two weeks.

Historic Funding Increase for K-12 Education

HB 33 includes historic funding and policy reforms focused on accountability and more options for parents.
The budget adds an additional $1.97 billion to public schools.

That’s a 12.9% increase over the biennium. Total Foundation funding for students in public schools is a record $9.6 billion in FY24 and $9.9 billion in FY25, amounting to a nearly $2 billion increase for K-12 schools. 

 Universal Scholarships for Ohio Families Looking for Educational Options

Flexibility and options are key for today’s families and students.
Parents should have an option.
The budget makes an Ed Choice Scholarship universally available to every Ohio student based on a sliding scale of income eligibility that is funded by the state.
Families earning 450% of the federal poverty level ($135,000 for a family of four) will qualify for a full scholarship funded by the state. That is $6,165 for K-8 students and $8,407 for high school students. Scholarships for students in families within incomes above 450% will be means-tested with scholarship amounts adjusted based on their income. Every student in Ohio will be eligible for a scholarship worth at least 10% of the maximum scholarship regardless of income.
“Parents know that where their children attend school makes a difference,” said President Huffman. “Children should never dread going to class, and parents should always have confidence that their children are walking into a positive, results-focused learning environment.” 

 Department of Education Accountability

The budget includes historic reforms to the Department of Education and to the duties of the State School Board. The plan restructures the Department of Education into the Department of Education and Workforce, which will fall under the authority of the Executive Branch of government. This structural change provides significant much-needed accountability over the department regarding education policy development and implementation that will greatly improve its operations. 

Protecting Free Speech and Diversity of Thought from the Campus to the Classroom

The Senate’s budget plan includes vital policy reforms to make sure our public universities are truly campuses and classrooms that welcome freedom of speech and diversity of thought.
Policy reform, sponsored by Senator Rob McColley (R-Napoleon) and Senator Jerry Cirino (R-Kirtland), establishes independent academic centers at five of Ohio's public universities. 

“This is a giant leap in the right direction for higher education in Ohio,” said Senator Cirino. “The purpose of these centers is to engage students of all viewpoints in the fundamental questions concerning American society by employing rigorous debate, intellectual freedom and mutual respect.”

“The new Institute at the University of Toledo will give our future lawyers the opportunity to learn the foundations that the United States was built upon," said McColley. "Students, especially law students, should be encouraged to have thoughtful and open debate on our founding documents and their historic role in our country.”

 Watch Senator McColley talk about SB 117 here

The bill requires all five centers to:

  • Educate students by means of free, open, and rigorous intellectual inquiry to seek the truth.
  • Equip students with the skills, habits, and dispositions of mind they need to reach their own informed conclusions on matters of legal, social, and political importance.
  • Value intellectual diversity in higher education and aspire to enhance the intellectual diversity of the university.
  • Affirm a commitment to an ethic of civil and free inquiry which respects the intellectual freedom of each member, supports individual capacities for growth, and welcomes the differences of opinion that naturally occur in a public university community.
  • Unlike the federal budget, the Ohio Constitution requires the state’s biennium operating budget to the balanced and passed by the end of final fiscal year on June 30th.

“Moms and dads work hard and want the best for their children,” said President Huffman. “It’s their money, not the government’s money, and this budget recognizes the serious kitchen table talks families have about money, about the cost of living, and about where and how their sons and daughters are educated which impacts the future of Ohio.”
The budget serves as Ohio’s official fiscal policy for the next two years and takes effect immediately.