Ohio Gov. John Kasich will deliver a package of budget policy changes Wednesday that could transform the way state government does business for years to come. Kasich’s budget presentation will not be a typical re-appropriations bill, which is normally made in the middle of the state’s two-year budget cycle to make minor spending adjustments, according to the Columbus Dispatch
Instead, Kasich will officially unveil a plan to cut the state’s income tax, replacing it with new taxes on shale drilling, and he will announce his statewide energy policy, which includes shale drilling regulations and setting aside $30 million for clean-coal research.
The tax cut is based on conservative estimates, and depends on how much Ohio collects from the shale industry. The cut could begin at 1.6 percent in 2014 and grow to 5.4 percent — or $500 million — by 2017.
Kasich is also expected to address statewide education reform, based on a plan from Cleveland that includes removing tenure from staffing decisions, addressing low-performance schools, and enforcing rules on charter schools. The governor may give the Cleveland schools the authority to make the changes as a test program for the rest of the state’s schools.
Cleveland’s plan, though, will likely be challenged. The Ohio Federation of Teachers claims parts of it resemble provisions voters rejected in Senate Bill 5 last year.
In addition, liberal policy-research group Innovation Ohio, said some of the plan’s ideas are “ fatally flawed,” including proposals to allow the transfer of local property taxes to charter schools.
Another policy change could include a proposal for a new tax structure for the state’s banks, which will provide relief for community banks while closing loopholes for larger financial institutions.
Meanwhile, Kasich’s energy policy changes might address energy produced by capturing waste heat as an acceptable renewable-energy source, and by accepting cogeneration — or the generation of heat and power through the same process — as an acceptable heat source.
Kasich’s energy policy also includes worker-training provisions, including linking veterans and minorities to jobs in the oil and gas industry and further regulations on high-pressure pipelines and well heads.
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