02/02/2021

First Alert with Calfee: Ohio Gov. DeWine releases FY 22-23 operating budget proposal

Ohio Governor Mike DeWine and Lt. Governor Jon Husted unveiled the Executive Budget for Fiscal Years 2022 to 2023.  Their presentation earlier today focused on a one-time spending program entitled “Investing In Ohio’s Future Initiative”, which seeks to invest more than $1 billion toward accelerating economic growth and ensuring economic vitality.

The initiative is focused on four areas: small business revitalization; supporting communities; developing a skilled workforce and telling Ohio’s story.

Small Business Revitalization: $460 million to support Ohio's small businesses that have been significantly impacted by the COVID-19 pandemic. The proposal includes:

• $200 million in grants for bars and restaurants;
• $150 million in grants for Small Business Relief Grant applicants, who previously applied and are qualified;
• $50 million in grants for lodging industry businesses;
• $40 million in grants for indoor entertainment venues; and
• $20 million in grants for new businesses formed from January 1, 2020 to March 31, 2020, many of whom were unqualified to receive previous funding.

Supporting Communities: $450 million to for targeted infrastructure projects, including

• $200 million to support infrastructure projects, like clean water projects, blight removal and preparing job ready sites, that will attract new jobs and investment opportunities
• $250 million to encourage broadband expansion, primarily focused on expansion of access but also helping with affordability concerns
• An additional $20 million/FY is allocated for ongoing support, for a total of $290 million over the biennium

Developing a Skilled Workforce: $70 million investment to upskill Ohio’s workforce. The proposal includes: 

• additional $5 million for 5,000 tech-focused credentials through the TechCred program in fiscal year 2021;
• $50 million ($25 million/FY) for 40,000 tech-focused credentials through the TechCred program; and
• $15 million for workforce efforts in economically distressed rural and urban communities.

Telling Ohio’s Story: $50 million investment toward elevating Ohio’s standing on a national scale through a marketing campaign to promote the state as a world-class place to live, work, and learn. The initiative aims to showcase all that Ohio, and its people, have to offer, including its wide array of career opportunities, top-tier colleges and universities, premier destinations, and vibrant communities.

According to the Governor and OBM Director Murnieks, the one time funds are a combination of $150 million in federal coronavirus aid and state savings from the freeze in state spending implemented in March 2020, state workforce reductions, debt refinancing and increased federal spending in Medicaid.  The Governor pledged no new taxes, though there are some fee increase proposals, including to the motor vehicle registration fee, which will be devoted to overdue increased support for the Ohio State Highway Patrol.  The budget also utilizes no dollars from the Rainy Day Fund.

In addition to the Investing in Ohio’s Future Initiative, the budget continues many of the previous budget’s priorities, including:

• more than $30 million in efforts to support law enforcement programs that increase transparency, recruitment of new officers, and create safe schools
• $125 million to reimburse Ohio counties for indigent defense services
• $242 million to the H2Ohio Fund to address water quality programs at the Depts. of Agriculture and Natural Resources and the Ohio EPA
• nearly $350 million for children’s services transformation, such as investing in public children services agencies, financial assistance for kinship care, and a state level ombudsman for children services
• $565 million in federal funds to local Community Action Agencies for rental and utility assistance related to the pandemic
• $50 million for health equity initiatives at the Dept. of Health, including $25 million to improve public health data and technology
• Ongoing support for Help Me Grow and lead hazard control programs
• Ongoing support for RecoveryOhio, the state initiative to address substance use disorders and support the mental health and well-being of Ohioans
• $1.1 billion for the Student Wellness and Success program at the Dept of Education to fund partnerships between schools and community organizations to develop programs that meet the social and emotional needs of students
• Expanding access to affordable childcare by raising family initial income eligibility requirements from 130% of the federal poverty level (FPL) to 138% FPL and 150% FPL for special needs children
• Increasing the per-student Ohio College Opportunity Grant financial aid award by $500 over the biennium and increasing the State Share of Instruction to the state’s public colleges and universities by 1.8% over the biennium

In full, the Executive Budget proposal contains authorization for:

                        FY 2022                                              FY 2023

All Funds:        $85.76 billion (2.2% over ’21)             $85.81 billion (0.1% over ’22)

State Funds:    $35.39 billion (3.4% over ’21)             $39.27 billion (11.0% over ’23)

The state funds increase in FY 2023 is accounted for by reduced federal Medicaid spending and resultant increased state spending following the anticipated end of the pandemic.

Maryellen K. Corbett
Attorney at Law
614.621.7754 Office
614.621.0010 Fax

Calfee, Halter & Griswold LLP
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Columbus, OH 43215-3465