House to vote on tax hike

Published 12:00 am Wednesday, April 9, 2003

COLUMBUS (AP) - A two-year state budget bill balanced with a combination of reductions to Gov. Bob Taft's $49 billion spending proposal and revenue expected from a temporary one-cent sales tax increase headed to the House floor for a full vote Wednesday.

The House Finance Committee voted on more than 70 last-minute changes before approving the bill on an 18-14 tally just after 2 a.m. Three Republicans joined minority Democrats in the dissent.

The bill, called the tightest budget in decades by Taft and his fellow Republicans, also would levy the sales tax on more services, such as towing, tanning and tattooing, and flatten or reduce spending for dozens of state agencies over the next two years.

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"There's a lot of need out there. There's a lot of good programs out there. But unfortunately we only have so many dollars, and we have to balance the budget under the Ohio Constitution," said Rep. Jim Hoops, a Republican from Napoleon and the finance committee's vice chairman.

"Sure, there are some people who might say we could have done better, but I think we did the best we could."

Republicans, who control the House 62-37, planned to add an amendment on the House floor Wednesday that would ask Ohio voters in November whether they want to allow video slot machines at Ohio racetracks to raise revenue in the second year of the budget.

If the gambling is approved, the penny increase to the current five-cents-per-dollar state sales tax would end on June 30, 2004. If it isn't, the tax would end a year later. The sales tax increase would generate about $1.2 billion more each year. Revenue from the slot machines is estimated at $400 million to $900 million a year.

Initially, GOP lawmakers eliminated $2.3 billion in taxes Taft proposed and promised to find deep cuts in his $49 billion spending plan. But House Republicans found only about $1.2 billion to trim and chose to rely on a temporary sales tax to raise the $3 billion to $4 billion they said was needed for a balanced budget.

Taft had proposed permanent tax increases, and has said he would oppose gambling without approval by Ohio voters.

Brian Hicks, Taft's chief of staff, said Taft likely will veto the video lottery provision because there seems to be a problem ensuring a balanced budget when estimates show that money generated by slot machines would be far less than the sales-tax dollars that it would replace.