Yesterday, the House Finance committee had its final hearing on Governor Kasich’s Turnpike proposal. The committee, made up of 20 Republicans and 11 Democrats, rejected a series of amendments that would have included in the new law, which authorizes Turnpike borrowing to pay for projects around the state, language to freeze tolls for local trips and guarantee that 90 percent of the proceeds were spent in northern Ohio. Those are promises that were made by the Governor when he announced the plan, but that he failed to include in the bill and his administration now argues would be counterproductive. All but two GOP committee members voted to refuse to consider the amendments. As a result, the bill remains as originally proposed by the Governor without amendment, and was sent to the full House by an 18-13 vote. The 99-member House of Representatives will hold a floor debate and vote on the package (HB 51) today in its afternoon session. You can watch live online. Session starts at 1pm, but other, less controversial bills will likely be taken up first.
Today, the Ohio House Finance Committee will vote on the Governor’s plan to borrow against future Turnpike revenue to fund construction projects around the state. Before voting on the plan as a whole, the committee will consider a number of amendments, most of which are designed to address failings of the legislation to live up to promises made when the Kasich administration originally unveiled the plan in December. Thirteen amendments are posted online on the committee’s website. When the committee returns from recess, many of these amendments will be offered to the full committee for a vote. Here’s a summary:
- HC0010 Requires Controlling Board approval for Turnpike to fund any project that is located outside the counties through which the Turnpike travels
- HC0011 Freezes Turnpike tolls at present levels until January, 2018
- HC0013X1 Limits the expansion of electronic toll collection by requiring that Turnpike tolls may only be collected through manual means or using an existing multi-jurisdictional collection system (E-ZPass).
- HC0014 Requires that no more than 60% of the cost of a non-Turnpike transportation project may be paid for using Turnpike funds
- HC0016 Restores current law provisions regarding Turnpike commission membership and term length; unwinds administration attempt to add two new Gubernatorial appointees, shorten terms of service
- HC0019 Limits bonding against future Turnpike tolls to the $1.5 billion that was announced in December
- HC0020 Limits future toll increases to the rate of inflation and only when annual traffic grows by less than one percent . Freezes tolls for 10 years at current rates for trips under 30 miles using E-ZPass.
- HC0024 Limits expansion of electronic toll collection by requiring manual collection or the use of E-ZPass (as in HC0013X1) and limits future toll increases to rate of inflation, when annual traffic grows by less than one percent and freezes tolls for 10 years on local trips using E-ZPass (as in HC0020).
- HC0026 Requires proceeds of bonds against future Turnpike tools to be spent in Northern Ohio, the definition of which is to be established by the members of a newly-created study committee. Prohibits Turnpike funds from “supplanting” or shifting existing ODOT funds away from Northern Ohio.
- HC0027 Same as HC0026, except requires 90% of proceeds to be spent in Northern Ohio, as defined by study committee, and similarly prohibits supplanting of other funds already designated for projects in northern Ohio
- HC0032 Omnibus Amendment 1 – prohibits toll increases for 10 years on trips under 30 miles using E-ZPass, limits toll increases to rate of inflation when annual traffic growth is less than 1 percent. Requires 90% of proceeds of bonding against Turnpike tolls are used in northern Ohio, prohibits Turnpike funds from paying for more than 60% of the cost of non-Turnpike projects, limits aggregate bonding to $1.5 billion, limits expansion of electronic tolling and creates a study commission to define “northern Ohio.”
- HC0034 Requires the Auditor to conduct a performance audit on the Turnpike Commission within 2 years.
- HC0035 Requires 90% of proceeds of Turnpike bonds to be spent in Northern Ohio, the definition of which is established by a study committee, prohibits “supplanting” of existing ODOT funds away from northern Ohio, and requires that the Turnpike must first maintain its existing system before any funds are dedicated to non-Turnpike projects.
- HC0036 Omnibus Amendment 2 – limits expansion of electronic tolling, prohibits toll increases for 10 years on trips under 30 miles using E-ZPass, limits toll increases to rate of inflation in years when traffic increases by less than one percent, limits aggregate bonding to $1.5 billion, requires 90% of funds to be spent in Northern Ohio as defined by a study committee and prohibits supplanting of existing ODOT funds.
Feel out of the loop? Here is your chance to catch up on what we’re watching this week. School Funding The Kasich administration released the much anticipated district-by-district school funding amounts this week and our own Stephen Dyer’s reaction was less than enthusiastic.
However, reality has proven otherwise. Looking at Kasich’s own district-by-district runs released yesterday, poor districts actually fare worse than wealthy. According to administration figures, for every dollar going to a kid in the property richest school districts, just 25 cents goes to the property poorest districts.Severance Tax On Monday, the Governor’s recommended operating budget was released. Included in the many tax changes were changes made to how the state wants to levy the severance tax that oil and gas developers pay. We commented that the administration was once again failing to put up a fight against big oil interests and allowing them to walk away with millions in tax savings. Turnpike Plan Hearings started this week on plans to borrow against future Turnpike tolls but it seems that promises originally made by the administration failed to make it into the legislation. Promises made to spend 90% of the revenue in northern Ohio and protect workers from lay-offs were no where to be found. Earlier in the week Jenny Brodie weighed in and asked where exactly is the new Turnpike money going if it isn’t going to projects in northern Ohio? Budget Review Ron Sylvester put together a recap of Governor Kasich’s budget that was released on Monday and asked whether middle and low income Ohioans were being short changed by policy included in it. Tax Reform We highlighted a new Policy Matters Ohio report that showed that the tax proposals in the Governor’s budget will overwhelmingly favor wealthy Ohioans. The analysis showed that Ohioans in the top 1 percent of incomes would receive an annual tax cut of $10,369 while those in the bottom fifth would see a net tax increase of $63 School Levies Intern Joey Crushham reviewed and previewed the most recent batch of school levies that voters weighed in on during last weeks special election. His analysis showed that half of school levies failed last week. Don’t forget to ‘Like’ us on Facebook and follow us on Twitter for up-to-the-minute analysis and commentary.
Hearings began Wednesday on the Kasich administration proposal to borrow against future Turnpike tolls to finance transportation projects around the state. Those hearings, and the bill which was released Tuesday, make clear that there are serious deficiencies in the details of the proposal when compared to the promises made by Gov. John Kasich in December. When announcing his plans for the Turnpike, Kasich assured northern Ohioans that their tolls would not go up, that no layoffs would occur and that 90% of the proceeds of the borrowing against future toll revenue would be spent in northern Ohio. Unfortunately, the language in House Bill 38 contains no such requirements. [Read more…]
If Gov. John Kasich’s latest two-year state budget proposal proves one thing, it is this: Most Ohioans don’t have a friend in Columbus. If you’re a high income earner, the governor is on your side. If you’re a bigwig at a Big Oil & Gas firm, the governor is your humble servant. If you are a charter school cheat, looting public education – John Kasich is your wheelman. If you’re looking for relief or a leveling of the playing field – you’re out of luck. There are still bills to be dropped, hearings to be held and a months-long political process to watch and to participate in on Capitol Square. Innovation Ohio will be unpacking the issues below in greater detail in the coming days and weeks. The state budget is about taxing and spending, but it’s also a huge collection of public policy changes. It’s a document that can be forward looking and which offers a plan to put public money into to the public’s interest. What we’re seeing so far is ideological dogma, little that speaks to the future and lots of your money flowing in the wrong directions. [Read more…]
Back in December Gov. John Kasich and ODOT Director Jerry Wray rolled out the results of the KPMG analysis and their plan for “unlocking the value” of the Ohio Turnpike. As part of their plan, Kasich said that they would leverage Ohio Turnpike tolls to float bonds to finance highway construction projects throughout Ohio. As part of this announcement, ODOT said, “more than 90 percent of new bond money will go directly to northern Ohio highway projects.” KPMG, the consultants that Governor Kasich paid to carry out the analysis of turnpike, said “virtually all Turnpike funds go to Northern Ohio.” Even prior to the KPMG analysis, Kasich said “’We’ll make the commitment that at least half the proceeds from a lease or bond would mean we put at least half the money on roads that are north of Route 30. We think that is a fair thing,’” Sounds like a pretty solid promise to continue to dedicate Turnpike funds to Northern Ohio, right? Not so fast. [Read more…]
In a recent interview with Ohio Public TV, State Rep. Rex Damschroder articulated an argument you’ll hear a lot soon, once Governor Kasich unveils his plans to “unlock” the value of the Ohio Turnpike to help fund transportation projects around the state: In short, why is it fair for Northern Ohio drivers to continue to pay tolls years into the future to finance transportation projects in Cincinnati and Columbus? Or, as Damschroder told The Blade in a story yesterday:
“It’s pretty clear that unless they make it a free highway for us, I don’t want to pay tolls for the rest of my lifetime as an extra tax for transportation projects across Ohio,” said Rep. Rex Damschroder (R., Fremont). “Having said that, I have not read what’s in the governor’s proposal, and I’m not going to criticize it until I see what it says.”If Governor Kasich is looking for a way to fill a gap between future construction needs and anticipated revenue, a solution would be to spread those cost across the entire state, rather than burdening only one region’s drivers. You can do that through increased bonding, an increase in the state’s gas tax, or lobbying Congress to authorize a new Transportation bill ending Ohio’s status as a “donor state” when it comes to what we get back in highway funding in exchange for federal gas taxes paid. Ohio can also use innovative financing approaches in which the actual users — drivers on brand new roadways and bridges, for example — finance its construction through tolls. But asking Northern Ohio drivers to carry the burden for projects everywhere else in the state isn’t fair. Rex Damschroder (R-Fremont) is the Chairman of the Ohio House Transportation committee.
h/t to Plunderbund The Ohio Farm Bureau Federation is asking members to contact Ohio Gov. John Kasich and their state legislators and express opposition to what is believed to be Kasich’s intention to move towards turnpike privatization. Innovation Ohio also opposes privatizing the turnpike. We believe it will lead to higher tolls, reduced maintenance or both. Estimates of what the turnpike would be worth to Ohio in terms of privatization has also been a moving target – and moving in the wrong direction. A few years ago, there were estimates that the turnpike could yield Ohio in the neighborhood of $5 billion. Latest numbers from the Kasich administration are today in the $1 billion range. Why on earth would the state make a deal when the market is depressed? Here’s what Farm Bureau member Al Divencenzo has to say on behalf of his farm and the organization regarding the turnpike:
Today, at a meeting of the Ohio Turnpike Commission, representatives from the Ohio Department of Transportation revealed the Kasich administration’s plans to “unlock” the potential of the northern Ohio roadway to fund highway project in other parts of the state. Two scenarios were outlined. One transfers control of the Turnpike to ODOT and issues bonds against the roadway’s future revenue stream, essentially taking a cash advance against future toll collection. The other puts the road in the hands of a private operator who would pay the state an up-front lump sum in exchange for control of the toll revenue for 45 to 55 years. Both scenarios also envision closing at least two maintenance facilities. And, presenters acknowledged that in either case, tolls would have to go up. Turnpike privatization is not popular with Ohioans. A statewide poll conducted last year showed 56 percent opposed the plan compared to only 32 percent in support. The numbers were even worse when residents near the Turnpike were surveyed, with opposition topping out at 65 percent among residents of Northwest Ohio. Apparently aimed at overcoming the objections of local residents opposed to paying higher tolls and having the money redirected to Columbus, Governor Kasich has been out making a promise, namely:
“At least” half the money will go to projects north of US-30.
Innovation Ohio has looked at the promise and finds it a mostly meaningless gesture. That’s because adding up all the counties crossed by US-30 and to its north, you find 48 percent of the state’s population, 42% of its lane miles of roads and 47% of its daily road traffic. In other words, John Kasich has promised to send just over half of the money to just under half of the state. If that’s the bone he’s throwing, it doesn’t have much meat on it. Whatever Kasich is proposing will require legislation, so it seems reasonable to ask how candidates for the Ohio House and Senate will vote on the proposal to increase tolls on northern Ohioans and send the money to Columbus. We look forward to their answers.