By 1808Delaware
Ohio Governor Mike DeWine signed the state’s $60 billion, two-year operating budget just before midnight on June 30, closing the fiscal year with a dramatic flourish. Known as Amended Substitute House Bill 96, the new budget governs spending for fiscal years 2026 and 2027 and includes sweeping changes to taxation, public education, and sports funding — along with a record-setting 67 line-item vetoes.
Flat Tax and Revenue Cuts Take Center Stage
At the heart of the new budget is a major tax policy overhaul. Beginning in 2026, all Ohioans earning more than $26,050 annually will pay a uniform 2.75% state income tax. This flat tax replaces the previous graduated system and lowers the top rate from 3.5% for those making over $100,000.
Legislative analysts project that the shift will reduce Ohio’s general revenue by more than $1.1 billion, with social services, certain tax exemptions, and agency budgets likely to feel the pinch.
DeWine defended the change, framing it as a simplification of the tax code and a boost to Ohio’s economic competitiveness. Still, critics argue that it disproportionately benefits higher-income earners and could undermine funding for schools, healthcare, and public safety.
Stadium Cash and Scrapped Reforms
One of the most controversial aspects of the budget is a $600 million allocation from unclaimed state funds to finance a new Cleveland Browns stadium. That money, typically reserved for forgotten utility deposits, old paychecks, or other dormant accounts, will be repurposed for the ambitious sports project.
Meanwhile, DeWine rejected several key proposals put forth by lawmakers, wielding his constitutional power to surgically strike provisions without vetoing the entire bill.
Record-Breaking 67 Line-Item Vetoes
Among the 67 vetoes — the most in any Ohio budget to date — were measures that would have:
- Restricted public libraries from displaying materials related to sexual orientation or gender identity where minors could see them
- Significantly expanded the state’s private school voucher system
- Limited how much reserve funding public schools could hold from year to year
DeWine, in his official veto messages, cited the need to preserve essential public services, protect local control, and avoid forcing districts into frequent levy campaigns. He also expressed concern that expanding vouchers without sufficient oversight could destabilize Ohio’s already complex education funding system.
Governor Explains His Moves
Speaking at a press conference the morning after signing the bill, DeWine described his actions in measured but firm terms.
“Everybody has a turn to make a move,” he said. “I made my move … I’m calling balls and strikes.”
He emphasized that the vetoes were not about partisan conflict but about balance and protecting what he views as core public services — including senior programming and Medicaid funding, both of which were preserved in the final budget.
Education Still in Flux
Though DeWine blocked the expansion of private school vouchers and limits on public school savings, the budget still leaves school funding relatively flat. His earlier proposal for a $1,000-per-child tax credit for children under 7 was stripped out during negotiations, and there was no major boost for child care support beyond a $10 million pilot cost-sharing program.
DeWine also rejected a push by lawmakers to make local school board elections partisan, a move he said would politicize education unnecessarily.
What Happens Next
Lawmakers return from summer break with the power to override any of the governor’s 67 vetoes by a three-fifths majority vote — a real possibility, given the Republican supermajorities in both chambers.
But DeWine is already looking ahead. He announced plans to convene a working group to study long-overdue property tax reform in Ohio, calling it “a critical issue that deserves the attention of leaders across the state.”
