$191 Billion Two-Year State Budget Deal Reached Between Ohio House and Senate

The conference committee on House Bill 33 (HB 33) released the Legislature’s final changes to the State’s Fiscal Year 2024 and 2025 Biennial Operating Budget. The two-year budget totals over $191 billion in state spending. The members of the committee voted along party lines to approve the conference committee report, which highlights the key provisions in this budget. If you would like to read the report of conference committee, please click here. 

The Ohio House of Representatives and Ohio Senate approved the budget conference report by a vote of 67 Republicans – 30 Democrats, and 25 Republicans – 6 Democrats, respectively. HB 33 now heads to Governor DeWine for his review and signature. The Governor will also have an opportunity to make line-item vetoes of provisions in the budget. 

The main points of contention during budget negotiations included the school funding formula, school choice vouchers and income tax cuts. Budget highlights can be found below.

Education

• Provides universal eligibility for all Ohio school children for a school voucher, however, the amount of each EdChoice scholarship will depend on family income. For example, children whose families earn up to 450% of federal poverty will receive a full EdChoice scholarship, while higher earners will receive lesser amounts. 

• Allocates nearly $1.5 billion in new spending for public schools. 

• Beginning October 1, gives the Governor’s office more control over education policy through a restructure of the current Ohio Department of Education (ODE), which will be renamed to the Department of Education and Workforce (DEW). The Director of DEW will be appointed by the Governor. Most powers and duties from the State Board of Education and the Superintendent of Public Instruction will be transferred to DEW, including statewide curricula. Items that will remain under the purview of the State Board of Education include educator licensure, licensee disciplinary actions, and certain other areas. 

• Eliminates a provision under the state’s “third-grade reading guarantee” that made kids repeat the third grade when they did not pass the reading exam. Though, the reading exam under the guarantee remains in place.

• Creates new free speech academic institutes at Ohio State University, University of Toledo, Cleveland State University, the University of Cincinnati, and Miami University. 

• Provides that higher education institutions can no longer ban students from being on campus if they refuse certain vaccinations. 

• Increases the minimum salary for teachers from $30,000 to $35,000.  

• High school students who graduate in the top 5% of their classes will be eligible for $5,000 scholarships for Ohio colleges and universities.

Tax Reform

• Creates a two-bracket income tax structure, with a lower bracket that now goes up to $100,000 of income. And implements an across-the-board income tax cut totaling over $3 billion in cuts over the biennium. 

• Expands Commercial Activities Tax (CAT) exclusions for Ohio businesses that grow to the first $6 million of revenue by FY 25. An estimated 90% of Ohio businesses would be excluded from paying CAT beginning in two years. 

• Establishes a two-week $750 million sales tax holiday to take place in August 2024 on most tangible goods that cost $500 or less. 

• Allocates at least $500 million for the Connect Ohio fund, which covers the cost of expanding state roads. 

• Includes $100 million in low-income housing tax credits and $50 million in tax credits for single-family affordable housing.

Health & Human Services

• Invests $30 million in grants to childcare centers to expand capacity.

• Subsidizes childcare for families making 145%, up from 142%, of the federal poverty level ($43,500 for a family of four).

• Allocates $40 million in aging grants.

• Increases the per Medicaid day rate for ICFs/IID by adding a professional workforce development payment.

• Increases reimbursement rates for healthcare direct service providers.

• Requires Department of Medicaid to seek federal approval to provide continuous Medicaid enrollment for Medicaid-eligible children from birth through age three.

• Increases base payment rates to $17 an hour in FY 2024 beginning on January 1, 2024, and to $18 an hour in FY 2025 for certain direct care services under the home and community-based waivers administered by Department of Developmental Disabilities.

• Requires Departments of Medicaid, Aging, and Developmental Disabilities to jointly submit an annual report outlining the wages paid to direct care staff providing services to enrollees under the Medicaid home and community-based services waivers.

• Establishes a five-year program in the Department of Medicaid to cover doula services provided to a Medicaid enrollee by a certified doula with a Medicaid provider agreement.

• Requires Medicaid to seek federal approval, by July 1, 2024, to expand the Integrated Care Delivery System (known as "MyCare Ohio") to all Ohio counties.

Local Government

• Allows police departments to hire police officers beginning at age 18.

• Establishes a state-wide ban on the sale of flavored vaping products and a ban on local governments from regulating tobacco sales. 

• Allocates $11.3 million to pay for the August 8, 2023 special election on State Issue 1, with potential for an additional $4.7 million, if needed.

• Exempts the income of individuals under 18 years of age from municipal income taxation.

• Provides up to $150 million to the Building Demolition and Site Revitalization Fund and requires each county to have a designated lead entity to apply and receive the grant money for the county under the Program.

• Creates the One Time Strategic Community Investments fund at $700 million.

Miscellaneous

• Increases parental paid leave for a total of 12 weeks paid at 70% of the employee’s base rate of pay. 

• Gives sexual assault survivors the right to know the status of their rape kit. Also requires an annual statewide audit of sexual assault examination kits to stop testing backlogs. 

• Requires social media companies to verify the age of users and obtain parental consent for children younger than 16 starting January 15, 2024. 

• States that the OneOhio Foundation is shielded from public records requests, overturning an Ohio Supreme Court decision to make the OneOhio Foundation public. The foundation is in charge of spending $1.1 billion in opioid settlement money.