The Budget Vetoes: Where We Stand Now

Much of what happened last week at the Statehouse was unprecedented. For the first time since 1977, a chamber of the General Assembly voted to overturn a Governor’s veto. All told, the House of Representatives voted to overturn 11 of Kasich’s 47 vetoes. Thankfully, the Medicaid expansion freeze veto was not among the 11.

Since this is unprecedented, let’s talk about process for a moment. The Ohio Constitution gives the General Assembly the authority to override a Governor’s veto with a three-fifths majority vote by each chamber. The relevant provision, Article II § 16, does not assign a specific timeline for the General Assembly to override the Governor’s veto. Therefore, the General Assembly has until the end of the legislature’s term to override a veto. In this case, the legislature could wait until December of 2018 to vote to override.

This is important for two reasons. First, as of now, the Senate has not conveyed whether or not it intends to vote to override any of the Governor’s vetoes. The chamber just cancelled two as-needed sessions scheduled for July 18th and 19th, and it doesn’t appear they will be back until after summer recess. Typically, the two chambers will adjourn for recess after a budget vote – and will not come back until September.

Secondly, just because the House did not vote to override the Medicaid expansion freeze veto in its initial round of veto overrides does not mean it won’t do so in the future. In fact, Speaker Rosenberger has publicly stated that his chamber may revisit the issue once the federal government comes to a resolution to its ongoing push to enact healthcare reform. In my opinion, it is likely a forgone conclusion that if the federal government were to reduce its pledged financial obligations to the state regarding Medicaid then we will see the General Assembly vote to override Kasich’s veto on the freeze.

What does all of this mean? Uncertainty. Which is a bad way for a state to operate – especially around its budget – which is something relied upon by every single citizen, company, organization, and local government as they plan their future.

For example, a few of the vetoed provisions overridden by the House dealt with the administration of Medicaid – essentially taking authority from the executive branch and transferring it to the legislature. The Governor’s Budget Director Tim Keen, recently stated that if these measures were enacted it would create a $1.4 billion shortfall in Ohio’s budget. This is because the Governor’s proposed budget accounted for $1.4 billion in anticipated savings due to future Medicaid policy changes. The final budget passed out of the General Assembly eliminated the ability for the Governor to enact those cost saving measures – but still accounted for the savings therefore creating a significant shortfall.

For now, we will have to wait and see how the two chambers will proceed on these vetoes. It appears to be an issue that will not be resolved any time soon and will likely hang as a cloud over state government.