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The State of Ohio

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House Minority Leader Allison Russo is leaving as Leader, state Democrats will choose their next Chair, Breaking down Senate budget Senator Jerry Cirino (R-Kirtland) is studio guest.

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00:00:38	House Minority Leader Allison
00:00:38	Russo is leaving as leader.
00:00:42	State Democrats
00:00:42	will choose their next chair.
00:00:45	And breaking down the Senate
00:00:45	budget.
00:00:48	All this
00:00:48	weekend, the state of Ohio.
00:01:09	Welcome to the state of Ohio.
00:01:11	I'm Sara Donaldson, in
00:01:11	for Karen Kasler.
00:01:14	Ohio Senate
00:01:15	lawmakers unveiled
00:01:16	hundreds of amendments
00:01:16	this week
00:01:17	to the biennial state budget.
00:01:19	Senate Finance
00:01:20	Committee members
00:01:20	tell me they came
00:01:21	from thousands
00:01:21	of submitted amendments.
00:01:24	Among the biggest changes
00:01:24	to the bill
00:01:25	the House sent over
00:01:25	two months ago
00:01:27	are a long debated income
00:01:27	tax cut
00:01:29	and what is now
00:01:31	the third iteration
00:01:31	of a framework
00:01:33	to fund stadium construction
00:01:33	in suburban Cleveland.
00:01:36	There are shifts in
00:01:36	K-through-12 public school
00:01:38	funding plans and property
00:01:38	tax proposals and much more.
00:01:43	I sit down with Senate
00:01:43	Finance Chair Jerry Serino
00:01:46	later on in the show
00:01:46	to break down the basics.
00:01:49	But first, Ohio House
00:01:49	Minority Leader Allison Russo
00:01:52	is leaving her post, leading
00:01:52	the Democratic Party's caucus.
00:01:56	Her colleagues first elected
00:01:56	her to that role in 2022.
00:02:00	our caucus rules dictate,
00:02:00	you know, that
00:02:03	if you do decide to run
00:02:03	for another office,
00:02:06	that you step down.
00:02:07	And I haven't made a decision
00:02:07	about that yet.
00:02:10	But I also know,
00:02:10	you know, as a strong leader
00:02:12	in the importance of smooth
00:02:12	and organized transitions,
00:02:16	I start at the beginning
00:02:16	of the General Assembly
00:02:18	and said to my members
00:02:18	that wanted to get us
00:02:20	through the budget process,
00:02:22	we're coming up
00:02:22	to the end of that process.
00:02:25	And so it's time
00:02:25	to make that transition,
00:02:27	to give a new leadership team,
00:02:29	time to get organized
00:02:30	for the next part
00:02:30	of the General Assembly,
00:02:33	after the summer break.
00:02:34	And, to prepare
00:02:35	for the 2026 election cycle,
00:02:35	to grow our caucus.
00:02:39	Russo led the caucus
00:02:39	through a brutal battle over
00:02:42	legislative redistricting.
00:02:44	She's not leaving
00:02:44	the legislature.
00:02:46	She says she's going to stay
00:02:46	in her House
00:02:48	seat through the end of this
00:02:48	general
00:02:49	Assembly in 2026,
00:02:49	when she hits her term limit.
00:02:53	Russo has not yet said
00:02:53	what her next move is, though
00:02:56	she's long been considered
00:02:56	among potential candidates
00:02:59	for Democratic federal
00:02:59	or state wide public office.
00:03:02	In May, she said her time
00:03:02	serving may not be over.
00:03:06	I don't think that my time
00:03:06	in public service is done.
00:03:08	But I have not made
00:03:08	a decision
00:03:11	about what that means
00:03:11	for 2026.
00:03:13	House Democrats have not yet
00:03:13	set the date to vote on
00:03:16	and fill the vacancy,
00:03:17	although the caucus
00:03:17	usually votes
00:03:19	first behind closed doors
00:03:21	and then the House holds
00:03:21	a full floor vote.
00:03:23	Both will likely come
00:03:23	before the end of the month.
00:03:27	And the Ohio Democratic
00:03:27	Party needs a new chair.
00:03:30	Its executive committee
00:03:30	is scheduled
00:03:31	to select
00:03:31	that person this coming week,
00:03:33	and more than one candidate
00:03:33	has said
00:03:35	they want to take over
00:03:35	for outgoing chair
00:03:37	Liz Walters, who has been
00:03:37	at its helm since 2021.
00:03:41	Walters is leaving to become
00:03:41	chief executive of Target
00:03:44	Smart, a democratic data
00:03:44	and analytics firm.
00:03:47	Democrats have weathered
00:03:47	back to back
00:03:50	bruising election cycles
00:03:50	on the statewide ticket.
00:03:53	Among the frontrunners
00:03:53	for chair is former state
00:03:55	lawmaker Kathleen Clyde,
00:03:55	who already clinched
00:03:58	a key endorsement in her bid
00:03:58	to be the party's chair,
00:04:01	that of former U.S.
00:04:02	Senator Sherrod Brown.
00:04:04	Clyde
00:04:04	says her unsuccessful run
00:04:06	for secretary of state
00:04:07	in 2018 prepares
00:04:07	her most for this role.
00:04:11	I learned about developing
00:04:11	a compelling message
00:04:14	and breaking through and,
00:04:14	crowded ballot as a down
00:04:17	ballot candidate.
00:04:19	And perhaps most importantly,
00:04:19	in a way, for this, office
00:04:23	that I'm seeking, I broke
00:04:23	a record for fundraising.
00:04:27	I was the raise
00:04:27	the most money, than any
00:04:31	Democratic secretary of state
00:04:31	candidate had ever raised.
00:04:34	When I ran
00:04:34	for secretary of state
00:04:36	and being able to raise
00:04:36	those resources,
00:04:39	connect with donors in state
00:04:39	and nationally is going
00:04:43	to be critically important
00:04:44	to have a well-funded Ohio
00:04:44	Democratic Party.
00:04:48	Stow City Council member Kyle
00:04:48	Herman worked in President
00:04:51	Obama's administration
00:04:51	and then for the
00:04:53	National Democratic Institute.
00:04:55	Since coming back to Ohio
00:04:55	in 2020, Herman has also been
00:04:58	an advocate
00:04:58	for ranked choice voting.
00:05:01	He says he's running
00:05:01	on his diverse background
00:05:03	in international, national,
00:05:03	state and local affairs.
00:05:07	levels.
00:05:07	I'm not part of the party
00:05:07	insiders old boys club.
00:05:10	I'm coming to this
00:05:10	from the perspective of
00:05:13	I thought my career
00:05:13	was going to be
00:05:14	about advancing democracy
00:05:14	in the Middle East.
00:05:17	I was working on democracy
00:05:19	programs in Iraq and Lebanon,
00:05:19	raising millions of dollars
00:05:22	in competitive grants
00:05:23	to try to democratize
00:05:23	those countries.
00:05:25	And I realized after 2020
00:05:25	that we need to democratize
00:05:30	Ohio as well,
00:05:32	the level of tribalism
00:05:32	and corruption
00:05:34	and polarization
00:05:34	that we have in our state.
00:05:36	None of the issues
00:05:36	we care about
00:05:37	are going to get solved
00:05:37	unless we fix democracy first.
00:05:40	And I want to make sure
00:05:40	that the Democratic Party
00:05:40	leaders understand that
00:05:43	and aren't trying
00:05:43	to just treat this as another,
00:05:47	transactional coronation
00:05:47	for who within their party
00:05:50	is going to be in charge.
00:05:51	We need to have serious
00:05:51	conversations as a party
00:05:54	about how do we empower
00:05:54	all Ada County chairs
00:05:57	to lead at the local level
00:05:59	And Tammy Wilson,
00:05:59	who has mounted
00:06:00	two unsuccessful
00:06:00	congressional bids
00:06:03	against Republican
00:06:03	Representative Jim
00:06:05	Jordan, is also in the race
00:06:05	for chair.
00:06:07	She says she believes
00:06:07	the Democrats need
00:06:09	to focus on strengthening
00:06:09	their infrastructure
00:06:12	statewide
00:06:12	and clarifying their message.
00:06:14	It was a more crowded field
00:06:14	before Thursday evening.
00:06:17	Former Ohio Democratic Party
00:06:19	executive director and current
00:06:19	state Senator Bill Dimora
00:06:22	threw his hat in the ring
00:06:22	early on
00:06:24	but has since bowed out,
00:06:24	saying
00:06:25	he didn't have the votes
00:06:25	to win.
00:06:28	Greene County Democratic Party
00:06:29	Chairwoman Kim McCarthy exited
00:06:29	shortly after dimora.
00:06:33	Whoever wins will be guiding
00:06:33	a political party that hasn't
00:06:36	won a governor's race
00:06:36	since 2006 statewide.
00:06:39	The party's presence
00:06:39	is dwindling with U.S.
00:06:42	Senator Bernie Marino's defeat
00:06:42	of Sherrod Brown last year.
00:06:45	Democrats hold only one
00:06:45	elected office statewide,
00:06:49	a seat on the state's
00:06:49	highest court.
00:06:51	And Ohio Supreme Court
00:06:52	Justice Jennifer Brunner
00:06:52	is up for reelection in 2026.
00:06:57	State lawmakers
00:06:57	have less than a month
00:06:59	to finish the state budget,
00:06:59	which governor
00:07:01	Mike DeWine
00:07:01	must sign by June 30th.
00:07:03	We sat down with the Senate
00:07:03	finance chair
00:07:06	to discuss the latest
00:07:06	draft released this week.
00:07:09	the Senate's version
00:07:10	of the budget totals
00:07:10	more than 5500 pages.
00:07:13	Perhaps the most defining
00:07:13	part, though, is a measure
00:07:15	that would flatten the state
00:07:15	income tax.
00:07:17	Your caucus has proposed
00:07:17	transitioning down
00:07:19	from the current
00:07:19	two bracket system
00:07:21	to a flat rate for everybody,
00:07:21	at 2.75% by tax year 2026,
00:07:26	I should say everybody
00:07:26	making under $26,000 a year.
00:07:30	Why and why now?
00:07:32	Well, it would be over 26,000
00:07:32	because
00:07:35	up to 26,000.
00:07:36	There are no taxes. Certainly.
00:07:38	So, look, this is, should
00:07:38	not be a surprise to anybody.
00:07:42	The the General Assembly,
00:07:42	our caucus in both the House
00:07:47	and in the Senate, have been
00:07:47	reducing the brackets,
00:07:50	reducing the rates
00:07:50	for over ten years now.
00:07:53	And remember, the income tax
00:07:53	was established in 1972.
00:07:58	So Ohio existed
00:07:59	for a very long time
00:07:59	without a state income tax.
00:08:02	And it doesn't mean that we,
00:08:03	you know,
00:08:04	we don't have to have it
00:08:05	in perpetuity
00:08:05	and continue it,
00:08:07	the way it's
00:08:07	currently structured.
00:08:09	Look, the idea is that
00:08:09	we want to support
00:08:12	economic growth
00:08:12	in the state of Ohio
00:08:15	and everything we do
00:08:15	is, is to promote that,
00:08:18	because unless we have strong,
00:08:18	vibrant, growing economy,
00:08:22	we can't do the things that
00:08:22	we need to do to help people,
00:08:25	in their safety net programs,
00:08:25	to be able to support them
00:08:28	if we don't have
00:08:28	the means to do it.
00:08:30	We can't do it
00:08:30	to the same extent that we
00:08:32	we think we need to.
00:08:34	So this is about
00:08:35	putting money back
00:08:35	in the hands of taxpayers,
00:08:38	who will take the money
00:08:38	and spend the money?
00:08:41	And that has a
00:08:41	multiplier effect on the state
00:08:41	of Ohio's economy.
00:08:45	And so we're excited about it.
00:08:46	We think it's the fair
00:08:46	thing to do.
00:08:47	Will be joining 14
00:08:47	other states
00:08:50	that have a flat tax.
00:08:52	It makes taxation
00:08:52	more predictable, easier to,
00:08:56	to deal with.
00:08:56	Easier to project what your
00:08:56	liabilities are going to be.
00:09:00	We think it's
00:09:00	a very net positive
00:09:00	for the state of Ohio.
00:09:02	Sure.
00:09:03	So right now,
00:09:04	this would most immediately
00:09:04	affect Ohioans
00:09:06	who make just over six figures
00:09:08	or anything over six figures,
00:09:08	if it goes into effect,
00:09:11	saving them and costing
00:09:11	Ohio more than $1.6
00:09:14	billion over this biennium,
00:09:14	according
00:09:16	to the Legislative Service
00:09:16	Commission.
00:09:18	Now, you mentioned high
00:09:18	earners
00:09:19	might reinvest their money
00:09:19	back into the state.
00:09:22	One senator tells me
00:09:22	they were asked to be modest
00:09:24	in their budget amendments
00:09:24	to account for,
00:09:27	you know, a tax cut like this.
00:09:29	What kind of cuts did
00:09:29	you have to make from GRF
00:09:32	funding
00:09:32	to make way for a flat tax?
00:09:33	Well, we had in
00:09:34	both the House version,
00:09:34	they had it in their budget
00:09:38	and we had it in ours.
00:09:39	There's lots of earmarks,
00:09:39	lots of requests
00:09:40	for special projects,
00:09:40	community projects, etc..
00:09:44	And, last year
00:09:44	we did the gift budget,
00:09:48	where the House and Senate
00:09:48	together spent for community
00:09:52	type projects, $730
00:09:52	million less than a year ago.
00:09:57	So this time around,
00:09:57	we asked our caucus to
00:10:00	to be more deliberate
00:10:00	in what they were asking for.
00:10:04	When we went through
00:10:04	and rationalized our budget,
00:10:07	prior to the sub
00:10:07	bill being introduced,
00:10:09	you know, we took a very dim
00:10:09	view of adding lots
00:10:12	and lots of things
00:10:12	that every member wanted to.
00:10:14	We wanted to have,
00:10:15	because we felt
00:10:17	it was a proper tradeoff
00:10:17	to make
00:10:19	so that we could lower
00:10:19	the tax rates
00:10:20	and do other things
00:10:20	that are in the budget.
00:10:22	Also, housing
00:10:22	and other places
00:10:26	that we can't do everything.
00:10:28	We have a fixed
00:10:29	amount of money
00:10:29	that we have to, to spend
00:10:31	and we have to balance
00:10:31	the budget, of course.
00:10:33	So we felt
00:10:33	it was worth it to, to, to,
00:10:37	diminish the number
00:10:37	of special earmark projects
00:10:41	in both the House
00:10:41	and the Senate
00:10:43	in order to be able to do
00:10:44	these bold, grand things that
00:10:44	we think are good for Ohio.
00:10:48	Now, shifting gears a bit,
00:10:49	and this may be the most
00:10:49	watched part of this budget,
00:10:53	the Senate got rid
00:10:53	of the House's debt
00:10:54	and bond structure
00:10:55	to fund a requested package
00:10:55	of $600 million,
00:10:58	so the owners of the Cleveland
00:10:58	Browns,
00:11:00	the Haslam family,
00:11:01	could build a domed stadium
00:11:01	and a surrounding
00:11:03	economic project in suburban
00:11:03	Brook Park.
00:11:06	So instead,
00:11:07	your caucus
00:11:08	has created a performance
00:11:08	grant program
00:11:10	funded by a percentage
00:11:10	of money, $1.7 billion.
00:11:13	I believe it would be
00:11:13	600,600,000,000
00:11:17	for the Browns.
00:11:17	Millions and billions.
00:11:19	And then,
00:11:20	you know, more money
00:11:20	for potential future projects.
00:11:23	That money is coming from cash
00:11:23	managed by the Department
00:11:26	of Commerce's
00:11:26	Division of Unclaimed Funds.
00:11:28	So how did you land on this
00:11:28	proposal?
00:11:31	Well, we were, first of all
00:11:31	to get the governor.
00:11:34	The House
00:11:35	and the Senate
00:11:36	have all agreed individually
00:11:37	and under
00:11:37	some different circumstance,
00:11:39	is that this project in Brook
00:11:39	Park to develop
00:11:42	not just the stadium,
00:11:42	but mixed use
00:11:44	development as well,
00:11:44	in an area of Cleveland.
00:11:47	And I'm a native Clevelander,
00:11:47	so, I know a little bit
00:11:50	about Cleveland there
00:11:50	in Northeast Ohio,
00:11:53	that is kind of an economic
00:11:53	dead zone right now.
00:11:55	So it needs to be turned
00:11:55	into something
00:11:57	that's productive
00:11:58	for the state, for the city,
00:11:58	and for the county.
00:12:00	So we like the project.
00:12:02	We think it's a good economic
00:12:02	development project.
00:12:04	The question was the House,
00:12:04	the governor in the Senate
00:12:07	had different views on how to,
00:12:07	help finance that activity.
00:12:11	So we don't like
00:12:11	I personally don't like
00:12:14	the idea of floating bonds.
00:12:16	The interest over 25
00:12:16	years of a bond offering
00:12:20	would be in excess of $400
00:12:20	million.
00:12:23	That would come out
00:12:23	of the General Revenue Fund.
00:12:26	I don't like that.
00:12:29	And and there would be
00:12:29	additional, legal costs
00:12:31	and so on.
00:12:32	Could be another 10
00:12:32	or $20 million
00:12:34	when you do a bond
00:12:34	offering that big.
00:12:36	So we were searching
00:12:36	for different ways
00:12:38	to do this without also,
00:12:38	as the governor had proposed,
00:12:41	raising taxes, doubling
00:12:41	the taxes on gambling.
00:12:44	Okay.
00:12:45	Our caucus really
00:12:46	doesn't like to raise taxes,
00:12:47	except in
00:12:47	very unique circumstances.
00:12:50	So we looked at
00:12:50	how could we do a cash deal
00:12:52	that's really
00:12:52	what it all came down to.
00:12:55	And I was aware
00:12:57	we were aware in the Senate
00:12:57	of the unclaimed funds number.
00:12:59	Right now, the up to date
00:12:59	number is about 4.3
00:13:03	billion
00:13:03	sitting in unclaimed funds.
00:13:06	It's what I call lazy money
00:13:06	because it's not really
00:13:08	being used to
00:13:09	to do anything else other than
00:13:09	gain some modest interest.
00:13:13	That is accumulating.
00:13:15	So we looked at that
00:13:15	and we said,
00:13:16	okay, you know,
00:13:16	can we tap into that?
00:13:20	By the way,
00:13:20	the the the legislature
00:13:22	in the administration's
00:13:22	in the past have,
00:13:25	borrowed money
00:13:25	from the unclaimed funds,
00:13:28	for certain emergency
00:13:28	situations. Okay.
00:13:30	So this is not
00:13:30	without precedent.
00:13:32	I think it has happened
00:13:32	about 15 or 16 times.
00:13:36	Other states do this as well.
00:13:38	And our goal here is to, to
00:13:38	to use this,
00:13:41	this cash in a way
00:13:41	that's going to produce,
00:13:44	you know, a multiplier effect
00:13:44	of other economic,
00:13:47	advantages for the state
00:13:47	and for the region,
00:13:50	where this is located.
00:13:51	So we took a look at that
00:13:51	and we said, okay,
00:13:54	we would like to negotiate
00:13:54	an arrangement
00:13:57	with the Browns,
00:13:57	with the Haslam family,
00:13:59	so that we could deliver
00:13:59	$600 million for this project
00:14:03	on top of the 1.2,
00:14:04	that billion that the Hassam
00:14:04	family is putting in.
00:14:08	Right.
00:14:10	And and try to
00:14:10	make this, this deal happen,
00:14:13	and we set it up
00:14:13	as a performance grant.
00:14:15	The performance
00:14:16	grant basically is lays out
00:14:16	over a 16 year period,
00:14:20	that in, in
00:14:20	if you can imagine
00:14:23	some columns here,
00:14:23	one through 16 for the years.
00:14:27	And then we have a projection
00:14:27	of incremental taxes
00:14:31	that are going to come
00:14:32	into the state,
00:14:32	as a result of this project.
00:14:35	In the beginning,
00:14:36	it would be largely
00:14:36	payroll taxes
00:14:39	that would come in
00:14:39	or income tax,
00:14:41	because of the construction,
00:14:41	phase of the, of the stadium
00:14:45	once they start having games
00:14:45	and parking and other things.
00:14:48	So there will be sales tax,
00:14:48	there will be income tax,
00:14:51	there will be, commercial
00:14:51	activity taxes
00:14:54	all coming into the state.
00:14:56	It will be verified
00:14:56	as incremental.
00:14:58	So we're not double counting
00:14:59	money
00:14:59	that the Browns are already
00:15:01	generating for the state
00:15:02	in Cleveland
00:15:02	at their current site.
00:15:06	And our plan
00:15:06	is over the 16 year period
00:15:08	that we will get back
00:15:08	in incremental taxes
00:15:11	to 600 million
00:15:11	plus another about 36 million,
00:15:15	because we have an inflator
00:15:15	in the targets for each year.
00:15:18	To protect the state
00:15:18	even further,
00:15:21	we have four true up
00:15:21	periods scheduled in this
00:15:25	16 year arrangement.
00:15:26	So at each four year
00:15:26	true up period,
00:15:29	we would sit down and look at,
00:15:29	okay,
00:15:31	what are the actual
00:15:31	incremental taxes
00:15:33	that have come in
00:15:34	and how does that compare
00:15:34	to the forecast?
00:15:37	And if there are any negative
00:15:39	gaps in between those numbers,
00:15:41	at the end of each
00:15:41	of the four year periods,
00:15:43	the Browns are putting
00:15:43	in a $50 million,
00:15:46	escrow account in place
00:15:46	that we will control,
00:15:50	that we will be able to tap
00:15:50	into and cover the differences
00:15:54	should they exist
00:15:55	in any of those four year,
00:15:55	two up periods.
00:15:58	If during the course of the,
00:15:59	let's say,
00:15:59	the next, eight years,
00:16:02	when we do the true ups,
00:16:02	if they are short again
00:16:05	and we've already used
00:16:05	the first 50 million escrow,
00:16:09	they have a line of credit
00:16:10	that will be established
00:16:10	for another 50 million that we
00:16:13	will be able to tap into.
00:16:15	So we think we
00:16:15	have $100 million of, of
00:16:15	surety basically set up
00:16:19	to make sure that
00:16:19	if there are any shortfalls
00:16:21	in the actual
00:16:23	incremental taxes produced,
00:16:24	that we will have coverage
00:16:24	for that.
00:16:26	And I want to shift
00:16:27	gears here, because there's
00:16:28	so much in the budget
00:16:28	to talk about.
00:16:30	But just a quick follow up.
00:16:31	You know,
00:16:32	you mentioned it's
00:16:32	not unprecedented to tap
00:16:35	into these unclaimed funds,
00:16:35	but what do you say to folks
00:16:38	who might argue it's
00:16:38	not the state's money to claim
00:16:41	these assets are coming
00:16:41	from dormant bank accounts or,
00:16:44	you know, uncashed
00:16:44	checks of Ohioans?
00:16:46	Yeah.
00:16:46	Well,
00:16:47	and this is an
00:16:47	I'll get into the the
00:16:49	legal concept of a shipment,
00:16:50	which I think most people are
00:16:50	probably not familiar with.
00:16:53	But, you know, look,
00:16:55	when the,
00:16:55	when money is handed over
00:16:56	to the state,
00:16:56	to the Commerce Department,
00:16:59	that is, that goes
00:16:59	into unclaimed funds.
00:17:02	It's come from banks,
00:17:02	insurance companies,
00:17:04	you know, credit card
00:17:04	companies, etc.,
00:17:07	who have also already been
00:17:07	searching for rightful owners.
00:17:12	Through various means,
00:17:14	for 5 to 10 years,
00:17:14	sometimes even longer.
00:17:17	And so by
00:17:18	the time it gets to the state,
00:17:18	it's already aged a bit.
00:17:22	And what our proposal
00:17:22	has a day after
00:17:25	it has to sit in the state
00:17:25	for ten years,
00:17:28	before it becomes,
00:17:28	subject to the shipment,
00:17:32	which will be including now
00:17:32	in the budget bill, language
00:17:35	means that the property
00:17:35	gets turned over to the state,
00:17:37	and then we can tap into it
00:17:37	to do whatever we want.
00:17:41	Now, we are not trying
00:17:41	to take money from Bill
00:17:44	and Betty Buckeye, as the,
00:17:44	commissioner or US county
00:17:48	executive in Cuyahoga
00:17:48	has claimed, because we have
00:17:51	almost $300 million
00:17:51	every year of new money
00:17:56	that is coming into
00:17:56	the unclaimed funds
00:17:58	that will age ten years before
00:17:58	we could, take access to it.
00:18:03	And,
00:18:03	and we have plenty of money
00:18:06	available
00:18:06	to meet the needs of anybody
00:18:08	who has a valid claim
00:18:08	as they come forward.
00:18:11	The fact of the matter is in
00:18:11	the commerce will verify this,
00:18:14	that the the, potential
00:18:14	for claims, valid claims
00:18:19	to be made to draw against
00:18:19	those dollars
00:18:22	are generally very, very slim,
00:18:22	especially after ten years
00:18:25	or even longer.
00:18:27	So we are not using taxpayer
00:18:27	money.
00:18:30	This is not tax money.
00:18:32	This is these are assets
00:18:32	that are unclaimed and
00:18:35	unaccounted for in terms
00:18:37	of having a relationship
00:18:37	with their ultimate owners.
00:18:41	We're also putting $1 million
00:18:41	a year
00:18:43	into the Commerce Department
00:18:43	in their budget
00:18:45	to help them
00:18:45	do an even better job.
00:18:47	They're already doing
00:18:47	a lot of work to find the,
00:18:51	the owners of this property.
00:18:53	We want them to redouble
00:18:53	their efforts further.
00:18:55	Again,
00:18:56	we want to make sure
00:18:56	that anybody who makes a claim
00:18:58	is is going to be satisfied.
00:19:00	And we are very comfortable
00:19:00	that that will happen.
00:19:02	So the formula to fund
00:19:02	public schools
00:19:04	has triggered a lot of debate
00:19:04	this budget cycle.
00:19:07	Much of that has centered
00:19:08	on decisions
00:19:08	about the final phase
00:19:09	of what proponents call
00:19:09	the fair school funding plan.
00:19:12	That was a 2021 reform effort
00:19:12	by lawmakers to put money
00:19:15	toward public schools
00:19:15	based on the actual costs
00:19:18	associated
00:19:18	with educating a student.
00:19:20	How does the Senate's version
00:19:21	differ
00:19:21	from what the House did with.
00:19:23	Well, yeah,
00:19:24	I think the governor's version
00:19:24	and the Senate
00:19:26	and the House's version
00:19:26	are different than ours.
00:19:29	We're all trying to
00:19:30	get to the same place,
00:19:31	some kind of a formula
00:19:31	that makes sense, to fund our
00:19:34	very important schools.
00:19:36	We certainly believe in that.
00:19:37	But the Senate's plan
00:19:37	is really the true
00:19:40	continuation
00:19:40	of the fair school funding.
00:19:45	Plan,
00:19:45	in its final two year phase.
00:19:48	So we've added dollars,
00:19:48	we've added $634 million
00:19:51	into that funding.
00:19:53	We've also added parameters
00:19:53	that we think are critical
00:19:56	in terms of recognizing
00:19:58	that there should be some
00:19:58	premiums paid for performance,
00:20:02	and also for,
00:20:02	to account for enrollment
00:20:05	changes,
00:20:05	you know, school systems
00:20:07	that are growing in
00:20:07	enrollment,
00:20:09	should be properly recognized
00:20:09	for that in the formula
00:20:12	schools.
00:20:13	Many of our systems
00:20:13	have seen steady declines
00:20:16	in the number of students,
00:20:17	and they shouldn't
00:20:17	get the same amount of money,
00:20:19	if they get fewer students
00:20:19	to take care of.
00:20:21	So, and in my,
00:20:21	finance committee,
00:20:24	we've been having hearings
00:20:24	for the last couple of days,
00:20:26	the number of student
00:20:26	superintendents
00:20:29	and school board members
00:20:29	have come in to testify
00:20:31	how much they like
00:20:31	the funding formula that
00:20:34	that we have put into place
00:20:34	under our, our method.
00:20:38	No school system will get less
00:20:38	than they received
00:20:41	in fiscal 21.
00:20:44	Okay, so we've protected them
00:20:44	with that flaw.
00:20:47	In a lot of school systems
00:20:47	are going to see increases.
00:20:50	A few are going to see
00:20:50	some decreases.
00:20:52	But you either have a funding
00:20:52	formula or you don't.
00:20:55	If you put
00:20:55	artificial guarantees in
00:20:57	then you
00:20:57	really don't have a formula.
00:21:00	And then one of the
00:21:00	biggest additions in the house
00:21:03	was this
00:21:03	addition of a ceiling, about
00:21:03	how many cash reserve schools
00:21:07	could hold on to.
00:21:08	They said that at 30%,
00:21:08	you guys raised it to 50.
00:21:12	And you also added
00:21:12	an overflow allowance.
00:21:14	So tell me a little bit
00:21:14	about the decision
00:21:16	making behind
00:21:17	one of the advantages
00:21:18	of going
00:21:18	last in the budget process
00:21:20	after the governor
00:21:20	in the Senate
00:21:21	or the, in the House,
00:21:21	is that we get we had more
00:21:24	a little bit more time
00:21:24	to go out and talk to people.
00:21:26	So I went out and I met
00:21:26	with superintendents.
00:21:28	Many of them,
00:21:29	talked with them
00:21:29	on the phone,
00:21:31	got a lot of feedback from
00:21:31	school board members as well.
00:21:34	You know,
00:21:34	it was pretty clear early
00:21:34	on that the 30% cap would be
00:21:37	would be a problem. Okay.
00:21:39	Because remember,
00:21:39	we want our school systems
00:21:41	to be fiscally responsible,
00:21:41	and that means that you
00:21:44	should have enough set aside
00:21:44	as carryover
00:21:47	from a prior year, in case
00:21:47	you run into some emergency.
00:21:51	So what we did
00:21:51	was we raised it to 50%,
00:21:54	to provide
00:21:54	some accommodation for funds
00:21:58	that needed to be kept
00:21:58	on their books year over year.
00:22:01	But we also wanted
00:22:01	to make an allowance
00:22:03	for capital projects
00:22:03	that need to happen. Right.
00:22:05	And so, so our, our,
00:22:08	difference with the house
00:22:09	is not only the amount,
00:22:09	the rate from 30 to 50%,
00:22:13	but we are adding we've added
00:22:13	language that allows for,
00:22:16	funds to be set aside,
00:22:16	separate
00:22:18	from their operating funds
00:22:18	for capital projects
00:22:22	that would be,
00:22:23	conducted within three years
00:22:23	of the time period
00:22:27	that we
00:22:27	we would start looking at this
00:22:28	in this,
00:22:28	this next fiscal year.
00:22:31	And so we've had a lot of
00:22:31	positive feedback about that.
00:22:33	And so we think it's,
00:22:35	we think our, our, our program
00:22:35	is the right one to go with,
00:22:39	we'll see how it goes in
00:22:40	when we get to conference
00:22:40	with, with the house.
00:22:43	But, we feel that
00:22:43	that's the right thing to do.
00:22:45	And I think a lot of school
00:22:46	systems are very happy
00:22:46	with our approach.
00:22:49	There are tens of millions of
00:22:50	dollars
00:22:50	worth of bonus royalties
00:22:52	coming from the oil and gas
00:22:53	drilling
00:22:53	going on under Ohio state
00:22:55	parks and public lands,
00:22:55	according to budget documents.
00:22:58	The Senate
00:22:58	kind of shifted money around
00:23:00	it, cut general tax revenue
00:23:00	for Parks and recreation,
00:23:03	and then fill that hole
00:23:03	with those fracking dollars,
00:23:06	one conservation
00:23:06	advocate tells me.
00:23:08	It's really hard to restore
00:23:10	general revenue funding once
00:23:10	it's cut in future budgets.
00:23:14	And these fracking
00:23:14	royalties are finite.
00:23:16	So why not just release
00:23:16	the bonus royalties to Odnr?
00:23:20	Well, I would disagree
00:23:20	with whoever that source
00:23:22	was that that it's difficult
00:23:22	to get things back in the GRF.
00:23:25	We have a very robust process
00:23:25	every two years,
00:23:28	and we're
00:23:28	we're in the thick of it right
00:23:28	now, where justifications
00:23:32	can be made for additions
00:23:32	to GRF.
00:23:34	We're doing it all the time.
00:23:34	Okay.
00:23:36	So I think that's a
00:23:36	that's a false narrative.
00:23:38	But in this case
00:23:38	what we're taking is
00:23:40	we're talking about it's
00:23:40	moving
00:23:41	the royalties generated
00:23:41	from fracking on public lands,
00:23:45	which are, by the way,
00:23:45	our public lands.
00:23:47	They don't belong to Odnr.
00:23:49	They belong to the people
00:23:49	of the state of Ohio.
00:23:51	We're talking
00:23:51	about direct redirect.
00:23:53	Those those, royalties
00:23:53	back to the general fund,
00:23:57	but to the line that supports
00:23:57	the operating costs of Odnr.
00:24:02	So it's really not leaving
00:24:02	Odnr.
00:24:04	And so,
00:24:05	it's just a
00:24:06	it's a proper redirection
00:24:06	that allows us to,
00:24:09	to make up
00:24:09	for some other cuts
00:24:11	that we had to make
00:24:11	in odd budget.
00:24:13	It's simply it's accounting.
00:24:15	And we're not going
00:24:16	to deprive Odnr
00:24:17	of their basic requirements
00:24:17	to, to run their operation.
00:24:21	We they do some great work,
00:24:23	and we want to make sure
00:24:23	that they continue to do so.
00:24:26	The Senate is scheduled
00:24:26	to make final changes
00:24:28	to the budget
00:24:28	this coming week,
00:24:29	with a floor vote on either
00:24:29	Wednesday or Thursday.
00:24:33	That's it for this week
00:24:33	for my colleagues
00:24:35	at the statehouse News
00:24:35	Bureau of Ohio Public Media.
00:24:38	Thanks for watching.
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Note : Transcripts are compiled from uncorrected captions