Cera concerned about state budget

Jack Cera

COLUMBUS — Ohio Rep. Jack Cera voted “no” on Ohio House Bill 49, the House version of the state budget for 2018 and 2019, in an effort to encourage the state Senate to be more fiscally responsible and realistic with the new biennial budget.

The bill passed the House on May 2. Joining Cera, D-Bellaire, in opposing the bill were 24 Democrats and 12 Republicans. “Yea” votes were cast by 54 Republicans and four Democrats.

Cera, who serves as the lead Democratic member on the House Budget Committee, expressed concern that the budget was “unbalanced and fiscally irresponsible.” Gov. John Kasich announced to the Ohio General Assembly in late 2016 that revenues were steadily falling short of earlier projections and sent a signal that this budget would need to be more restrained due to a possible recession.

“That caused ears to perk up, a lot of questions to be asked and a lot of concerns to be raised,” said Cera in a speech on the House floor on May 2. Kasich “was letting us know that we would be facing a difficult budget.”

In April, Kasich and Republican leaders announced they would need to cut close to $1 billion from the budget to maintain a stable and balanced budget for 2018 and 2019. Cera noted that the House budget that was passed fell “hundreds of millions of dollars short” of being a balanced budget bill by that measure.

“We can’t spend money we don’t have. Because of the decline in revenue, hopefully there is a realization that we need to stop tax shifting and address the issues we need to address,” said Cera.

Cera said the state has taken a $700 million per year hit in revenue due to renaming of companies as “pass-through entities,” which allows businesses a 100 percent income tax abatement.

“There have been years and years of shifting taxes, with local taxes and sales taxes. Not everyone is benefiting from income tax breaks,” Cera said. “And that policy is not creating revenue and jobs.”

Cera believes the problem is Republican tax philosophy promises that have not come true for Ohioans. For example, income tax breaks may disproportionately benefit people with higher incomes, while higher sales taxes have a greater impact on people who earn less.

“Ohioans were promised tax giveaways for the wealthy paid for by tax hikes on the rest of us would grow our economy and create jobs — but this tax shifting promise just hasn’t come true,” Cera said. “That’s the reason we’re up against a wall today, people still can’t get ahead. They’re not getting raises. They’re paying more than their fair share in taxes, and life is getting more expensive.”

Cera is concerned that the state Office of Budget and Management has been over-estimating projected revenue, which “is a real problem.” He said the latest tax revenues for the current fiscal year show that Ohio’s “stumbling economy” resulted in a nearly $160 million shortfall for April 2017 alone.

“We have a constitutional responsibility to balance the budget. When I look at where we’re at as a state, we are heading in the wrong direction,” Cera said. “Ohio’s fiscal shortfall during the course of one year now climbs to negative $1.057 billion under GOP leadership.”

Cera is pushing for a bipartisan oversight commission — The Budget Management and Stabilization Commission — to investigate the cause of Ohio’s missing revenue and to ensure the state budget is structurally balanced and stable. He also has sponsored legislation that will change Ohio’s outdated severance tax laws to keep a “fair share” of oil and gas revenue in Eastern Ohio, where that revenue is generated.

“The state currently keeps all severance tax dollars from oil and gas exploration and has used it in the past to pay for income tax giveaways that mostly benefited millionaires and billionaires,” Cera noted. “If it’s a choice between politicians in Columbus doing the right thing with money or local communities making those decisions, I think most people would rather see that money and those decisions coming back home.”

Cera’s legislation — House Bill 105 — was introduced in March and co-sponsored by Rep. Brian Hill, R-Zanesville. It would limit the amount of revenue credited to the state’s Oil and Gas Well Fund that would go to the Ohio Department of Natural Resources for well-plugging and regulatory activity to no more than $18 million. The rest of the revenue generated by the oil and gas industry would stay local and be used to fund infrastructure.

The bill will receive a new hearing on Tuesday, with several Eastern Ohio government officials and oil and gas industry experts expected to testify on behalf of the proposed measure.

The budget bill is currently being debated by the Senate. If approved, it would then go to the governor to be signed into law.