As always, the state budget, passed every two years, is the single most important piece of legislation passed by the Ohio General Assembly. Tax, education, health care, criminal justice, and local government issues are all touched on in this critical legislation. Getting budget policy right means making sure resources are spent wisely on the things government must do. Just as importantly, it means enhancing liberty, creating a better environment for job and economic growth, and securing prosperity for Bob and Betty Buckeye.
Ohio has greatly benefited from the discovery of the Utica and Marcellus shale formations, which has brought money and jobs to an economically depressed part of the state. According to Ohio Department of Jobs and Family Services, shale has created more than 195,000 core and ancillary jobs in Ohio and, on average, those jobs pay 36 percent more than the average Ohio job. That is good news for the Buckeye State.
Every year, The Buckeye Institute and the Fraser Institute release Economic Freedom of North America (EFNA), an index ranking economic freedom in the states. The rankings look at the ability of individuals to act in the economic sphere free of undue restrictions, such as a high tax burden or labor market regulations.
On June 12, the Ohio Senate unveiled its initial version of the state’s biennial operating budget, improving upon the House of Representatives’ version, House Bill 49. The Senate’s solid first effort goes further than the House in some key areas—including administrative agency cuts, Medicaid reductions, municipal tax reform, criminal justice, and healthcare—but more work remains to be done, especially with recurring revenue shortfalls looming on the horizon.
Winston Churchill once wrote, “We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.” There is great wisdom in Sir Winston’s statement. Fortunately, Ohio policymakers have largely embraced this wisdom over the last decade with state tax reforms that have positively impacted Ohio’s economy. However, much more is needed to keep Ohio moving forward, including broader reforms to Ohio’s local tax structure.
Those of you who are tired of getting jarred by potholes on your way to the grocery probably welcomed promises of increased federal infrastructure spending with open arms. Many of those federal dollars flow back to our communities for us to decide how to spend, so it’s important to remember that infrastructure goes deeper than roads and bridges — literally. You probably see crumbling roads daily; what you don’t see are the miles of water and wastewater pipes lying underground that are also in need of replacement.
The pipeline would stretch across Ohio from the hills of Appalachia in the southeast part of the state all the way to the Toledo area. Building it will take $620 million in construction payroll that will create 10,000 jobs, with as many as 6,500 of those jobs in Ohio. Rover will also pay more than $120 million to Ohio landowners in direct payments for using their land. This means more Ohioans will have opportunities to work and save for the future.
Strong evidence indicates that “lock’em up and throw away the key” policies make our communities less safe and come with a hefty price tag. Ohio spends $1.7 billion every year on corrections—$25,000 per inmate per year—and research suggests we are overpaying for our investment. Study after study has demonstrated that evidence based criminal justice reforms make communities safer while saving constituents money.
In an opinion piece in The Hill, Buckeye’s Rea S. Hederman Jr. looks at the need to give states more flexibility to, “change Medicaid overall and think of how to deliver the best care, to the most patients for the best price.”
Now that the Ohio House of Representatives has approved its version of the state’s biennial budget, it falls to the Senate to improve House Bill 49 and address the missed opportunities for significant reform. To help the Senate improve the budget and keep Ohio on the road to success, The Buckeye Institute offers the following suggestions.