On Monday, January 30, Gov. Kasich unveiled the highlights of his executive biennial state budget, which covers Fiscal Years 2018-19. There were no major surprises, as the components followed suit with what the governor has pushed for in previous budgets

Tax Cuts & Shifts 

Kasich’s executive budget continues his focus on reducing the personal income tax while raising the sales tax and broadening the services tax. His plan would increase the severance taxes on oil and gas, as well as hike the “sin taxes” on cigarettes and alcohol. Reducing progressive taxes and enhancing regressive taxes has the effect of disproportionately rewarding the wealthiest Ohioans and hurting the poorest Ohioans. Unfortunately, these are the same tax policies that have led to revenue shortfalls — the shortfalls that prompted the governor to proclaim that the state is on the verge of recession. There is little evidence to suggest that Ohio could be headed to recession, but there is much evidence to suggest that income tax cuts produce less revenue. Ohio has a revenue problem, not a recession problem.

Higher Education Freezes and Funding

In step with his previous budgets, Kasich has called for tuition and fee freezes at institutions of higher education for the next two years. His budget would increase overall higher education funding by 1% in FY 2018 and then an additional 1.8% in FY 2019. 

State Share of Instruction (SSI)

According to the administration’s budget recommendations, State Share of Instruction (SSI) — the primary means of financial support to colleges and universities — will increase 1% in each fiscal year. In pure dollar amounts, not adjusting for inflation, this will put SSI slightly above where it was under Gov. Strickland’s final budget in FY 2011. While we commend the slight increases in funding, we still have a long way to go in order to adequately support our institutions to ensure that quality instruction can be maintained while costs for students are contained.

Ohio College Opportunity Grant (OCOG)

The budget recommendations also include Ohio College Opportunity Grant (OCOG) increases: 3.1% in FY 2018 and an additional 2% in FY 2019. This grant helps low-income students attend any institution of higher education in the state, and we applaud the Kasich administration’s continued restoration of funding to this grant.  

Other Higher Ed Policy in the Executive Budget

Kasich’s budget would require public institutions of higher education to pay for students’ textbooks, allowing the institutions to charge students only up to $300 to defray those costs. We do not yet know how much this unfunded mandate would cost institutions, but expect that the Inter-University Council and Ohio Association of Community Colleges will be providing estimates and addressing the issue. 

Additionally, the governor would like to push more competency-based education (including giving Western Governor’s University status as an Ohio institution), authorize community colleges to offer more bachelor’s degrees, and allow high school students to get college credit for work experience. He also has proposed a scholarship fund to assist drop-outs with returning to college and completing their degree. 

Next Steps

The budget process has just begun. Soon we will see the Ohio House of Representatives produce a formal bill containing the governor’s proposals. The budget bill will go through numerous hearings in the House and Senate Finance Committees and Subcommittees before the final version is approved by the governor at the end of June. 

The Ohio Conference AAUP will be engaging fully in budget deliberations. We intend to provide testimony at hearings and lobby legislators individually. We will be working with chapters to help our members schedule lobby visits with their representatives and senators. 

We will keep you updated as the process unfolds and the budget is amended.

Finally, We are in the midst of finalizing our second-ever Ohio Higher Education Report, which is entitled “Education First.” The report will highlight the problem of decreased emphasis on quality instruction and propose policy solutions that can help right the path. Be on the lookout for an e-mail from us within the next couple of weeks with a link to the report.