State gives, and it also takes
Many Ohioans weigh the pros and cons of the new state budget.
COLUMBUS (AP) -- For Christina Schnetzer, Ohio's new budget means she will have to find a way to pay each month for $700 in prescriptions on just over $1,000 in income. But come April, she'll save about $60 from no longer paying income taxes.
The single mother from southwestern Ohio is among 25,000 parents cut off from Medicaid under the budget that began Friday. But 1,800 families will rejoice that a parent or grandparent can go to an assisted living center using Medicaid dollars instead of a nursing home.
For typical Ohioans, the good and the bad seem to even out under the two-year, $51.2 billion spending plan.
Income and sales taxes will go down, but smokers will pay more and the record pace of school districts seeking new property taxes is likely to continue. State parks remain free, but more litter might be lining the roads. Farmers will shell out a few dollars more each year for fertilizer and seed, but Amish home bakers don't have to pay an extra $10 for a state license.
For the poor, pocket change from tax reductions is offset by less money available for health care.
Working parents who earn 90 percent of poverty wages will lose coverage from the federal-state Medicaid insurance program; they used to be covered at 100 percent. Adults on Medicaid will get less vision and dental coverage, while having to pay toward those services and prescription drugs for the first time.
Schnetzer, 40, of Blanchester, needs several medications for complications from a spider bite and frequent doctor visits to monitor the medications. She gets child support and works seasonally grading proficiency tests, and would qualify for Medicaid if her income dropped to $962 a month.
"Am I supposed to work less and not really be able to afford groceries and clothes?" asked Schnetzer, who lobbied lawmakers to try to prevent the Medicaid cut. "It seems as if the government is hell-bent on cutting the people who need it the most."
About 550,000 Ohioans with taxable incomes of $10,000 or less, including Schnetzer, no longer have to pay income tax, a savings averaging $40 a year. The budget also gradually cuts income tax rates by 21 percent over the next five years, so a family of four with $150,000 in taxable income would by 2010 save just over $1,500.
The budget's changes to how Ohio taxes businesses might be the hardest for individuals to notice. Over the next five years, the state will eliminate taxes on profits, equipment and inventory. They will be replaced by a 0.26 percent tax on sales and other business activity.
The state's Development Department paid for a study that said the tax changes would create about 43,000 jobs over five years, increasing Ohio's 5.5 million jobs by less than 1 percent.
Overall, manufacturers welcome the change, because getting rid of old taxes will free money to invest in new machinery for factories. That won't necessarily translate into jobs, said Alan McCoy, spokesman for Middletown-based AK Steel, because some industries including steel have been shrinking the past five years.
Taxes will increase for grocers, auto dealers and other businesses with high volume and low profit.
Groceryland, a three-store chain based in Dayton, will try not to pass on the cost to customers, said its president, David Lowery. The chain will pay $27,000 more in taxes, resulting in a 15 percent decline in profit. That means less money to invest in new equipment or expansion, he said.
Smokers will help pay to prevent more cuts to Medicaid and other health programs. Cigarette taxes will rise by 70 cents to $1.25 a pack.
"That's ridiculous," 19-year-old Jamell Butler said, shaking his head as he waited to catch a bus to work in Toledo. But the cost won't make him quit his half-pack-a-day habit. "I don't think it's fair but that's the way life is," he said.
Cities and counties could be cutting "adopt a road" litter patrols and recycling programs, and businesses will get fewer grants to turn trash into new products. The budget cuts about $6 million a year for litter and recycling prevention, leaving about $3.75 million a year for grants.
In Mansfield, that might mean no more annual spring stream cleanup, no more bags and safety vests to distribute to volunteer litter patrols and no classroom education on recycling, said Kim Hildreth, program coordinator. She and the city's other staffer on the program might lose their jobs.
"A budget that's supposed to create jobs is going to be kicking people out of the workplace," Hildreth said.
Many school districts will get the same amount of aid next year as they did this year, but prices for salaries, school lunches, textbooks, fuel and other needs keep going up. Districts will seek more property taxes, or students will see larger class sizes or other cuts, said Donna Boylan, director of member assistance for the Buckeye Association of School Administrators.
There are bright spots for state residents.
People will keep enjoying state parks for free after a proposal for $5 parking passes was killed. The fee would have reduced participation in events such as a 100-mile trail run through Mohican State Park that draws hundreds of racers and spectators, said organizer Bob Strong of Loudonville.
"It would have been horrible for us," he said.
And lawmakers found money to restore full state aid for about 5,000 middle-income families who for the past year have had to pay for more medical expenses for children with severe incurable conditions present at birth, such as cerebral palsy or hemophilia.
"It's a miracle," said Wendy Stainbrook, whose 9-year-old son Tanner has cystic fibrosis. "So many families depend on this to have a normal life."