State of The State Message, Reaction

Governor John Kasich said he brought the speech to Wilmington not just because new House Speaker Cliff Rosenberger is from the area, but because he thinks Wilmington's story of economic comeback after the loss of shipper DHL almost seven years ago is a metaphor for the state's own recovery from the great recession. Kasich admits Wilmington isn't done rebuilding, but neither is Ohio.
"The state of the state is getting stronger and we have regained our footing, but we must act decisively now to seize the greater opportunities that await all of us. We are better today than we were, and we are rising."

Kasich spent much of his 1 hour and 18 minute speech talking up the income tax cuts in his budget - a 23% across the board cut and the elimination of income taxes for a million small businesses - and the tax increases that would pay for them: namely, the hike in the state sales tax, in the commercial activity tax and in the severance tax on oil and gas drillers. He didn't mention the dollar per pack increase on cigarettes, but he did call the existing severance tax "unconscionable" and "a big fat joke". And Kasich seemed aware that he faces an uphill battle on getting those tax increases past lawmakers.
"We have to continue to win battles against the status quo if we want to take Ohio where we want it to be, where we need to be. And that means we have to continue to battle special interests that want to lock us in where we are today."

Kasich also spent a fair amount of time talking about higher education, and he also explained his controversial K-12 school funding plan, which he said will mean less money for districts with high property wealth and high income wealth, because those districts can raise more money. The upshot is that more than half of Ohio's school districts will get funding cuts, which Kasich knows isn't popular.
"You don't have to do everything I want here, and I'm sure you won't, ok."

The governor also honored three Ohioans with his Courage Awards - the state's 200,000 nurses, Shane and Brittany Robinson, who saved a couple from a flaming car after coming upon the wreckage while driving in Lorain County in 2013, and Lauren Hill, the Mt. St. Joseph University basketball player who's gained national attention for her battle against incurable, inoperable brain cancer.

There was a bit of a mixed reaction from leaders in the legislature. More on that from Andy Chow.

The top Republican leaders, Senate President Keith Faber of Celina and House Speaker Cliff Rosenberger of Clarksville, stayed positive while reflecting on Kasich's speech overall.

The House is already holding committee meetings to look over the governor's budget proposal. Rosenberger says they are on board with Kasich's ideas as long as they continue his caucus' goal of increasing mobility.

"And so whether it's issues on the severance tax, whether it's how the education funding model continues to look in the future - we're going to take our time to really drill in and make sure we're doing the right things to continue to improve the quality of life for Ohioans."

Business groups-such as the Ohio Chamber of Commerce-have noted their reservations about Kasich's ideas to raise the sales tax and the taxes on business activity. Senate Minority Leader Joe Schiavoni-a Democrat from the Youngstown area-strongly disagreed with Kasich's assessment of the state of the state, and said he feels the governor is "disconnected from reality". Schiavoni says the governor's main talking points are nothing new - including his plans to put more money into the state's rainy day fund, which already holds $1.5 billion in reserve.

"If we have that money in the rainy day fund why are we raising the sales tax? Why are we cutting local funding for schools-for safety-and creating an environment where the locals are starving so they're going to reach back out to the taxpayers by way of levies."

The Democrats focused on their opposition to cutting the income tax, once again saying it doesn't do enough to benefit the middle and lower class.

With Karen Kasler, I'm Andy Chow at the Ohio Public Radio Statehouse News Bureau.

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