ANALYSIS: Governor’s executive budget proposes a $1 billion answer to the COVID-19 question
Yesterday, Ohio Governor Mike DeWine and Lt. Gov. Jon Husted unveiled their proposed Executive Budget for 2022-23, which – to be honest – would probably not make the Chamber Connection weekly newsletter.
However, the proposal’s Investing in Ohio Initiative has more than $1 billion to help spur economic growth in Ohio – which includes a lot or money for small business owners – which means it’s worthy of a breakdown.
If you haven’t heard, the budget (which would go into effect on Aug. 1, the first day of Fiscal Year 2022) unveiled yesterday includes a $1 billion Investing In Ohio Initiative that aims to begin the recovery from COVID-19’s impact on the economy.
The Investing In Ohio Initiative within the proposed Executive Budget includes $460 million to support Ohio’s small businesses that have been significantly impacted by the COVID-19 pandemic. The proposal includes:
- Investing $200 million in grants for bars and restaurants: This would provide funding up to $30,000 to help businesses in this segment – some of which have the most hard hit by the pandemic and the related restrictions. This money is on top of the $37.5 million assistance fund created last year;
- Investing $150 million in grants for Small Business Relief Grant applicants, who previously applied and are qualified. This is on top of the $125 million small business relief grant fund created in 2020;
- Investing $50 million in grants for lodging industry businesses;
- Investing $40 million in grants for indoor entertainment venues: Bowling alleys, privately owned museums, and other entertainment venues could benefit from this pool of money;
- And investing $20 million in grants for new businesses, many of whom were unqualified to receive previous funding. This is new funding. Most of the past COVID relief programs excluded new businesses started in the past year. It’s specifically earmarked for businesses that opened between January and March 2020.
The grants for bars, restaurants, lodging and entertainment venues would provide up to $30,000 to help kick start business. It’s worthy of note that lodging, indoor entertainment venues, and new businesses were not given specific funds to draw from in 2020.
In addition, the initiative also includes $70 million to help upskill Ohio’s workforce, including:
- Investing an additional $5 million for 5,000 tech-focused credentials through the TechCred program in fiscal year 2021;
- Funding $50 million ($25 million in each fiscal year 2022 and 2023) for 40,000 tech-focused credentials through the TechCred program;
- And investing $15 million for workforce efforts in economically distressed rural and urban communities.
This is a big leap forward for our larger employers. We’ve often sung the praises of the TechCred program and the way it provide
s money to help businesses increase the knowledge of their employees and the productivity of the business. This is a big deal for both high school students and adult workers who believe their future lies in the skilled workforce.
A few thoughts:
- I’m a little surprised that salons, barber shops, spas and tattoo and piercing businesses were not specifically given a relief fun. Those businesses have been decimated by the restrictions and had to take their sanitization and distancing protocols to new places.
- DeWine says there are no new tax increases here. But there would be a $10 increase in motor vehicle registration fees, which would impact businesses who buy and use their own vehicles. There’s a $2 title fee increase, which would earmark money for the State Highway Patrol. Also included in the proposal is a first-ever hospital licensure fee, but budget officials didn’t immediately say what that fee would be or how much it might generate.
- A real curious move yesterday was the inclusion of a $50 million public relations campaign aimed at promoting Ohio to the rest of America. The idea, DeWine said, was to convince those elsewhere that Ohio is “the place to be.” This might be the biggest eyebrow raiser of the day.
To wrap up, the executive budget, while a great start, is not the finished product. This is the first step in a long journey. The final budget will look vastly different than the one proposed today. It always has and always will.
But, that’s not reason to be glum about what might happen here. If there’s anything we know about the Legislature in the past year, there’s been plenty of bluster about how much the pandemic has hurt the Ohio economy, and more specifically, small businesses. This is a great opportunity for those legislators, regardless of party, to put their literal money where their mouths are. Realistically speaking, there will be a long debate about everything in this budget, but it’s good to see the administration looking ahead and trying to help our businesses get back on solid footing.
Now about that $50 million PR campaign …