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July 22, 2019
OML UPDATE AT-A-GLANCE
Here are the top three things you need to know from this past week:
- This past Sunday was National Ice Cream Day, prompting the release of a study by Infogroup ranking the "Top Ten Cities for Ice Cream." Youngstown ranked #1 in the country, while Toledo ranked at #8.
- According to the Ohio Office of Budget Management Ohio ended Fiscal Year (FY) 2019 with tax revenues totaling over $651.1 million over estimates. Total revenues for FY 19 also exceeded total revenues for FY 18 by more than $1 billion.
- Just under 70,000 entities have filed to do business in Ohio in the first half of 2019, according to the Secretary of State's office. This is 2,901 filings more than total business filings at the midway point of 2018.
FINAL STATE OPERATING BUDGET: MORE HIGHLIGHTS
Last week, Governor DeWine signed Am. Sub, HB 166, the $69 billion State Operating Budget, after vetoing 25 provisions from the final version of the bill as passed by the state legislature.
Two of those vetoes affect municipalities. The first veto struck a provision that would have allowed a taxpayer to opt out of centrally filing their net profit income taxes with the state through the Ohio Business Gateway (OBG) within the first 24 months of opting in. The second veto removed the exemption of residential property subdivided for development from increased property taxes for up to 5 years.
While we are disappointed the Governor chose to veto a provision that would have granted the Ohio taxpayer more autonomy over their tax filings, we are grateful that the Governor recognized the negative affect exempting residential development property from market value property taxes would have on local government revenues. The League, along with other local government organizations, requested the latter veto. You can read the letter HERE.
We have covered all of the provisions affecting municipalities that made it into the final version of the budget. That list can be found HERE. However, other major appropriations and policy changes were made in the budget. We want to make our membership aware of the following provisions:
- Fund Appropriations. The final budget totals at $69.79 billion in General Revenue Fund appropriations and at $143.27 billion for all-funds appropriations over the biennium.
- Small Business Income Tax Deduction. Both chambers of the state legislature compromised on changes to the business income tax deduction by retaining current law at the current $250,000 deduction with a 3% tax cap on income above that, but excluded both lawyers and lobbyists from that deduction.
- Personal Income Tax. The legislature eliminated to two bottom brackets and removed personal income taxes on income below $21,750, while creating a 4% tax cut for all other tax brackets.
- Pharmacy Benefit Managers (PBMs). All Medicaid Managed Care (MCO) plans will now go through one PBM that will be overseen by the state.
- School Funding. Funding for schools will be increased by 4.1% or $381.8 million for the '19-'20 school year, followed by a 2% increase for the '20-'21 school year. The budget also allocated $675 million over the biennium for Wrap-Around Services for at-risk students, as well as $20 million for new school buses.
- Academic Distress Commissions (ADC). There will be a one-year moratorium on the establishment of new academic distress commissions.
- High School Graduation Requirements. For the class of 2023, students will have to meet a number of new requirements, many of which shift emphasis away from standardized testing. These new requirements include:
- Completing the minimum number of courses mandated by both the state and the district;
- Pass a score indicating competency in Algebra and English Language Arts II exams;
- Earn two diploma seals
- Students failing to achieve necessary test scores will be able to display competency by entering the military or career-tech fields.
- Primary Voting. St. Patrick's Day (March 17) will be the new primary voting day for Ohio in 2020.
- Tobacco Purchase Age. The new age requirement to purchase tobacco in the state of Ohio is 21.
The House will return this week for one final session to act on HB 6, the legislation impacting the nuclear power facilities in Ohio among other things, before adjourning for the summer. The full legislature will return in the Fall to pick up the legislative schedule and begin committee hearings once more. We will report on the action taken on HB 6 in our next bulletin.
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Ohio Municipal League Meetings & Trainings
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Mayors Court Refresher Trainings
August 16 ~ Attorneys & Magistrates Only
October 25 & November 15
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