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Governor Mike DeWine.

Budget includes boosts to charter schools and vouchers, but cuts to traditional public schools.

A new candidate readies his long awaited launch for the Ohio governor's race.

And a former candidate for governor shares his concerns about the fate of the federal consumer agency.

He helped start.

That's this weekend.

The state of Ohio.

Just.

Welcome to the state of Ohio.

I'm Karen, counselor, governor Mike DeWine.

Proposed budget includes $23.4 billion for education.

And DeWine said it would fully fund the final phase in of the school funding formula that was first implemented in 2021.

But an analysis of the numbers shows there are actually cuts to traditional K through 12 public schools and increases for vouchers and charter schools.

The budget uses salary and other data from 2022 for the fair school funding plan for K through 12 public schools, an analysis of information from the Legislative Service Office, which reviews legislation for lawmakers, shows traditional public schools will get $16 billion, but that includes a cut from the current spending that adds up to $103.4 million over two years, with more than half of the state's over 600 districts getting less state funding.

And a fifth of those schools actually grew their student populations in the last year.

Meanwhile, public charter and Stem schools will receive $2.7 billion, or $221.8 million more, and the state's five voucher programs will get $2.4 billion, which is $265.4 million more over two years.

Because the budget does not increase voucher amounts, this suggests that there's the expectation that more families will take advantage of vouchers, which are available to any family that wants them, and most vouchers awarded.

And the recent expansion went to kids who have never attended traditional public schools, though those traditional public schools will get less with those increases for vouchers and charter schools, there's a 1.9% boost in spending for primary education in the first year of the budget, and 1.4% more in the second, DeWine's office said in a statement that the budget focuses on where parents choose to obtain an education for their students, and that the changes reflect student population movement.

It continues, quote, the previously adopted Cut Patterson funding formula is designed to reduce state share when local share increases due to increased property tax revenue.

Due to the increase in property values across Ohio, Cut Patterson is designed to reduce state payments in such a scenario, even when the formula is fully funded as it is in the governor's proposal.

We'll have more on the fair school funding plan from former Representative John Patterson of the Cut Patterson formula.

Coming up, tech billionaire and Republican former presidential candidate Vache Ramaswamy kicks off his campaign for the Republican nomination for governor on Monday with a statewide tour featuring four stops Cincinnati, New Albany, Strongsville and Toledo.

Like many Republicans, Ramaswamy wants to eliminate Ohio's income tax.

As he mentioned in a video he posted on X earlier this month.

I do think that eventually it's going to be table stakes to be zero income tax states to state to the low property tax burden in states that, like Texas today, are closer to being regulatory sandboxes for many industries.

In that same video, Ramaswamy also talked about universal school choice, including home schooling, merit pay for public school faculty, and a focus on physical fitness, something also mentioned by former Ohio State football coach and newly inaugurated Lieutenant governor Jim Tressel, who has not ruled out a run for governor.

Ramaswamy, who is from Cincinnati and lives in Upper Arlington, has lined up several national conservatives as well as statewide elected officials to endorse him over Attorney General Dave Yost, who announced his campaign for governor last month.

State lawmakers are taking another pass on a bill to regulate recreational marijuana in Ohio, which voters approved in 2023.

The measure, from Senator Steve Huffman, is similar to one that passed the Senate last session and would ban smoking cannabis in public.

Reduce home grow from a maximum of 12 plants to six plants and limit how concentrated dispensaries THC products can be.

Opponents came out this week to blast the bill, some of whom are members of the Ohio Cannabis Coalition.

Or can.

So we definitely have concerns when it comes to Senate Bill 56.

I will say this week there was a bill, and we think that made significant, better changes to the bill.

And my understanding is there are more changes potentially coming.

So we're looking forward to seeing what that looks like.

But I think part of our concern is when he talks about, you know, the safety aspect.

If you look at what the Division of Cannabis Control is already doing, that's what they're focused on and they're taking care of a lot of these concerns already.

So in some ways we see Senate Bill 56 as unnecessary.

At the same time, he said he wants to, you know, retain, consumer availability.

We want to do that as well.

But if we make changes and ultimately can't have a competitive market when it comes to what we're seeing in Michigan and other states, then consumers won't have the availability of those products.

Senator Huffman's bill would lower how potent the products can be saying it THC cap of 35% for plant products, 70% for concentrates and extracts, bringing recreational marijuana in line with medical marijuana.

The current cap is 40% of plant products and 90% for concentrates, as I understand it.

It seems those caps on potency, which I know okay on is referred to as purity, are a big concern.

So does Ohio want to be the leader in high potency products, or why are you concerned about that?

Well, I don't know if necessarily I'm going to be the leader in high potency products, but you're right.

We've been saying this is really a purity argument.

So when you pick up these products, they do have dosage recommendations for consumers.

So, you know, I think a lot of people get scared when you're hearing about these high potency products, but truly, it's just a purity argument.

You don't want all these additional fillers in your products.

You know, you can look at it like alcohol.

Do people drink liquor like they drink beer?

No, because there are recommendations on those products.

We're looking at that the same way.

And you know who doesn't have THC caps?

The black market and Michigan, again, we want to make sure that consumers aren't going to the that illicit market, that they're not going and taking their tax dollars up to Michigan, that they're staying here in Ohio, where we know that we have safe, regulated and tested products.

One of the things that Senator Hoffman's bill would have done is increase the tax from 10% to 15%.

You've got governor Mike DeWine talking about proposed 20% tax rate changes are out of that bill, out of that sub bill, as I understand it now.

It apparently will be dealt with in the budget.

So what tax rate would okay.

I'd like to see.

And also where do you want those taxes to go or do you have a position on that.

So where we want to see it is at the 10% that the voters approved already.

Again, we're we're in our infancy when it comes to our market.

And so to make a big change like taxes and and ultimately what we could see is a rise in prices for consumers so early on could really plunge our market into chaos.

Again, we have to look at this, that we are competing with Michigan and we are competing with that illicit market, and we don't want to be putting all this burden of additional pricing on Ohioans.

And again, sending Ohioans out of state where we're not going to see any of those tax dollars.

So if you raise the tax, the question is, do you even end up with more tax revenue if people stop buying those products because we made them more expensive?

Additionally, I think it's really important to recognize that, yes, it's a 10% excise tax, but we also see a 7.5% sales tax.

So really we're we're at 17.5%.

Do you have a position on where the taxes should go?

Well, we certainly are concerned about our host communities and that fund, my understanding was the original Senate Bill 56 when it did deal with this and then also the governor's executive budget, both of them would, would get rid of that fund.

And we're very concerned about that.

You know, our members, pride themselves in being good community partners.

And this is something these local communities had promised to them and have planned on having.

And so we certainly think that that fund funding needs to stay in place.

And finally, this bill is similar to one that passed the Senate last session but did not get through the House.

Do you expect that this measure or something similar to it, will get all the way through the house?

And are you preparing for that?

I certainly don't have a crystal ball, and I think if anyone acts like they know what's going to happen in the future, they probably they probably don't.

Especially around the state House.

That's always been kind of my rule of thumb.

So we'll see what happens.

We're having conversation with lawmakers, and we have been very hopeful that they seem interested in learning more about the industry and and really making sure that we get this right, because that's ultimately, I think, what Ohioans really what do you find that there's a Partizan split on whether Democrats or Republicans support or oppose your industry in general?

I don't think so.

I think a lot of lawmakers, again, are interested in learning about this, this new industry.

And and at the end of the day, that's what we hope.

We just hope that we can be educating people.

You know, when you look at those who voted for issue two, it certainly wasn't a Partizan split.

You know, we saw, red counties who voted for it.

We saw blue areas that voted for it.

So I don't think that marijuana is a Partizan issue any longer.

There's a high probability the bill will be on the Senate floor this coming week.

The future of the Federal Consumer Financial Protection Bureau hangs in the balance as President Trump's administration tries to weaken it and possibly shut it down.

There are legal battles over whether he and Elon Musk, the billionaire owner of X, Tesla and SpaceX, who Trump appointed to head the Department of Government Efficiency, have the authority to shut down the Cfpb since Congress created it.

But the first leader of that bureau, a former Ohio treasurer and attorney general who ran for governor against Mike DeWine in 2018, says there is reason for alarm with what the Trump administration has been doing.

Why state House News Bureau colleague Joe Ingles talked with Richard Cordray about the future of the Cfpb.

you're seeing what's happening in Washington, D.C. with your old bureau.

What are your thoughts about that?

Well, I think there's there's reason for real concern and even alarm, because right now, Doge is not even a governmental entity.

And they are moving through the federal government with kind of a wrecking ball.

Without giving a lot of forethought, without understanding how things fit together.

Just for the sake of trying to break break things and see what the reaction is.

And that's a that's a concern.

But if you look at it and think about it, the Cfpb was created, 15 years ago in the wake of the financial crisis.

If you remember, the foreclosure crisis and and mortgage problems brought down the economy caused millions of people to lose their homes, millions of people lose their jobs.

That was deeply felt across the state of Ohio.

And the Cfpb was put in place to stabilize the mortgage market to make it secure and effective.

Once again, and safe for people to borrow to, to buy homes.

And to put in place other protections for us and our families against financial companies being able to rip us off and cheat us, without, without any consequences.

So if the Cfpb if the CFP.

So if the agency goes away tomorrow, what would what would the net effect be for consumers?

Well, first of all, it would be it would be terrible for consumers because it would remove all the protections that have been put in place that have gotten lots of money back for people, $21 billion that was wrongfully taken from them over the last 15 years by a series of different acts by financial companies that were rectified because of the work of the Consumer Bureau.

The rules that were put in place to safeguard the mortgage market and render it a place that we could lend and borrow with confidence once again, have been notable, and they've strengthened the economy, but I don't think there's any real chance that the agency is going away.

It is mandated by Congress.

Congress passed the law.

The law is in place.

You can't simply wave your hands and ignore a law.

And you can't ignore a statute that says that the bureau shall exist and it shall do this, and it shall do that.

And the executive branch has to take care that the law is faithfully executed.

So I think there's a lot of doom and gloom right now.

But they're looking at it a little more carefully now, taking some time to do so.

And I think they will find that the laws are pretty firm in terms of what they can do and cannot do.

And I think they'll also find that there's a lot of financial companies, not just consumers, that are being helped by the CFP.

If you're a small bank or a credit union, you're regulated by the FDIC.

And if the CFP were put out of existence, which would take an act of Congress.

But if it were, that would mean the big banks would not be regulated and you wouldn't have a level playing field that would hurt a lot of small banks in communities across this country and mortgage lenders as well.

So what do you think will and what will happen?

Do you do you know what kind of what are you expecting I guess is the way to put it?

Well, I think they're trying to trim down this federal government and to some degree, that's not a bad thing.

It's a good thing for new administrations to come in and have fresh eyes on things.

But I think when you start to see how things are put together and how they fit together and what purpose they serve, you begin to recognize that you can do more harm than good in some places.

So, for example, they have just fired most of the probationary employees at the bureau.

It's about 70 people from what I see, out of 1700.

So it is not a major pruning of the Bureau, but it's something that they thought was appropriate, and it's within their purview.

But for the rest of the employees, they have legal protections under the law, and they're being more careful about that.

And I think that they will find and we will find over time that, the things they do to harm the Bureau will be somewhat limited in scope.

So you think that in four years, the Bureau will still be around, and it will still be operating much the same way it's operating now?

Well, I think the bureau will certainly still be around unless Congress can repeal it.

But I don't think there's the votes there to do that.

I think there's, you know, a lot of sound, sober, thoughtful people, in the Congress that aren't just the ideological warriors.

And they're going to hear from their constituents, they're going to hear from the community banks, they're going to hear from the credit unions.

They're going to hear from mortgage lenders that it's not just consumers that benefit, but also some of these smaller companies.

And I think they'll hear from consumers, people in their families who have been helped by the bureau and who understand that they want somebody on their side looking out for them, making sure they're treated fairly in what can be a very complicated financial marketplace.

You've seen the stack of papers at a mortgage closing that people don't fully understand.

A lot of fine print there.

And people don't want to be taken for a ride on things that, that the companies get the better of them on.

So, I think the bureau will certainly still be there.

Will it be damaged?

Will it be, have its wings clipped?

In some respects, I think.

Yes, and I'm concerned about that.

But I, I really don't think that they can simply, wish away, an act of Congress and, an agency that was established by the Congress very specifically for purposes that benefit ordinary Americans.

And for my own knowledge, it takes 60% of Congress to, 60% vote to do something with the bureau, but would take a 60% vote in the Senate to do that.

There's talk of doing this in some sort of budget reconciliation bill.

But they'd have to pretty much get every single Republican in the Congress to line up for that.

And, you know, strange things happen sometimes, but, I don't expect that to happen, Joe.

Okay, great.

Anything I didn't ask that you think is important to talk about?

Oh.

I'm sure there's many things that'll do for now, but I'm around, and, you know, I'm very concerned about this subject and following it closely.

And there may be a lot more news coming in the coming weeks.

And by the way, there is a new nominee.

They've nominated someone to be the director of the bureau.

So it seems that they expect that it will continue to exist.

And in fact, the nominee has pretty good credentials.

And I'm optimistic that may be a good leader for the bureau coming up.

Cordray is not run for office, since he lost by 3.7 points to DeWine in 2018.

Cordray said he's not focused on running for office right now, and that his focus is on the unprecedented threat that he says Cfpb is facing.

Back to the state budget, school funding numbers are always a big concern for parents and for lawmakers who want to ensure the schools and families in their district are getting what they want for education.

But the formula that makes up the fair school funding plan is complicated.

And while the budget fully phases in the formula, it didn't fully phase in the funding because the salary data and other inputs are from 2022 and were not updated.

Last week, we featured the first part of my conversation with Democratic former Representative John Patterson.

This week we pick it up again, talking about the formula that he and Republican former speaker Bob Kopp developed that forms the foundation of the Fair School Funding Plan, which seeks to base state aid on both property taxes and income in each district.

It's predictable.

This formula is predictable.

Keep in mind that your local school districts are required to submit a five year forecast.

The state gives us a two year budget.

Now, how many of of of you would like to have to plan five years, but not knowing where your income is coming?

Years three, four and five.

Awkward.

This allows that to happen.

So that they can plan those programs, get them in motion, and then sustain them.

Predictability is important, but you mentioned the inputs, the idea of making sure that salaries and all this stuff is updated right now in this budget, I believe the inputs are from 2022.

Yes.

So that argues that the plan is not fully funded.

That is correct.

And it the their updates have to move along with it.

And if you think about adequacy and equity and the Supreme Court, the four draft decision, if it's fully funded, it meets the constitutional muster.

And that's what we need to abide by in the state of Ohio.

You've heard Speaker Matt Huffman, among others, say that this is he's got real concerns.

Hoffman has specifically said he thinks it's unsustainable to keep this funding up, and there may be some other things to look at.

Is it unsustainable?

I mean, this this is a lot of money we're talking about here to keep it going.

It is I think it's a matter of choice.

When we really care about something, we find a way.

I question the will, not the why, the will.

And this is where the people of Ohio, through their elected representatives, have to agree that funding education is important because it's to be selfish.

It's about the retirement programs that people have, right?

If we don't have people paying into Social Security or stress or what's going to happen to retirement, what happens to property values when schools aren't funded properly and people don't want to move there?

You remember as a young person when you decided you and your husband decided where you were going to marry, didn't you check out the schools to see they were good?

And if they're not, how does that impact a person?

And this is about this is a moral obligation we have for the kids of the future, for the state of Ohio, for all of us to live in a state that is prosperous.

How does the Fair School funding plan affect school levies?

Though Ohio has more school levies than in the other state in the country.

So now you open another black box, if you will.

If you remember, you were probably just, in elementary school, HB 920, in the 1970s, which caps the amount of money that a levy can, can, can generate.

And now it's enshrined in the Constitution.

Well, without those levies being able to be adjusted for inflation, the only way to get new money because of inflation is to go back to the voters.

So we have levy fatigue.

So what I would like to do if I still were in the legislature, the next steps would be to begin to have some serious discussions about that.

Now, keep in mind, in the 70s we had rampant inflation and interest rates were high and it made sense to cap property taxes, but they just put a lid on it and there's no wiggle room there.

To change that, you'd have to go back to the Constitution.

Exactly that.

And that's why it would.

But that also that's not only school levies, that's fire, that's police, that's library, that's park.

All of them are impacted.

And I think they did what they thought was right.

It at that time.

But I also think it's time to revisit that in a broader scale.

And that's going to be a Herculean effort, one thing at a time.

But but you're right about levies.

There is levy fatigue.

And this is discussing the whose time has come, I feel.

What about vouchers?

How do they play a role in this?

Because vouchers have now been expanded.

Pretty much any family who wants them, including now there's a lot of families.

I think most of the families who are getting vouchers have kids who have never been to public school.

That's correct.

Now, keep in mind the General Revenue Fund funds education, whether it's a fair school, funding for, public schools or the voucher program.

Also all comes out of the GRF.

So, that's a discussion that we have to we have to have to I mean, I know that there's a court case coming up that determined everybody knows this.

The constitutionality of of vouchers and such.

I also know that that we in Ohio and is parents believe in choice that if, you believe that your kids would be best educated in the, the Korean Academy of Higher Learning, that would be your choice.

Or send them to a parochial school.

But what I come back to is where there are choices.

There also comes responsibility.

There's a responsibility to fund, the public schools.

And there are also ways the funding, those other alternatives to.

The next hearing in the case involving the coalition known as vouchers Hurt Ohio is set for April in Franklin County Common Pleas Court.

You can see the first part of my conversation with Democratic former Representative John Patterson in our archive at State news.org, and that is it for this week from my colleagues at the Statehouse News Bureau of Ohio Public Media.

Thanks for watching.

Please check out our website at State news.org or find us online by searching the State of Ohio Show.

If you'd like to be in the know about what we're following, you can register for Ohio State House alerts by texting state news to (380) 233-5686, or go to join subtext.com/statehouse News Bureau.

You can also hear more from my colleagues Joe Ingles and Sarah Donaldson and me on our podcast, The Ohio State House scoop.

Look for it every Monday morning wherever you get your podcasts.

Thanks for watching and please join us again next time for the state of Ohio.

You.

You.

Just.

Support for the Statehouse News Bureau comes from Medical Mutual, dedicated to the health and well-being of Ohioans, offering health insurance plans, as well as dental, vision and wellness programs to help people achieve their goals and remain healthy.

More at Med mutual.com.

The law offices of Porter, right, Morris and Arthur LLP.

Porter Wright is dedicated to bringing inspired legal outcomes to the Ohio business community.

More at porterwright.com.

Porter Wright inspired Every day in Ohio Education Association, representing 120,000 educators who are united in their mission to create the excellent public schools.

Every child deserves more at OHEA.org.