By ANDREW WELSH-HUGGINS, AP Statehouse Correspondent
COLUMBUS, Ohio (AP) - Ohioans would pay more on everything from buying a car to having it towed under a proposed two-year budget sent to Gov. Bob Taft early Friday.
Schools would see a modest funding increase and be under increased pressure to boost enrollment.
The House and Senate, both controlled by Republicans, raised more than $3 billion in taxes to help balance the $48.8 billion spending plan.
The budget also provides a small increase for universities, who said the funding doesn't meet a projected rise in enrollment.
Almost 37 percent of the record $48.8 billion spending plan -- or about $18.1 billion -- is spent on social services for poor Ohioans.
That Medicaid spending is itself a record and drew warnings from Republicans that growth in spending on social services must be slowed.
"You don't spend your way to prosperity," said House Speaker Larry Householder, a Glenford Republican.
The House voted 53-46 to approve the budget early Friday, with eight Democrats -- all members of the Black Legislative Caucus -- joining Republicans.
Black House Democrats also helped pass the original House version of the budget in April.
The Senate approved the budget 22-10, with six Democrats joining Republicans. Six Senate Republicans voted against it.
Rep. Chuck Calvert, a Medina Republican, said the budget was the best lawmakers could do in tough economic times.
Rep. Barbara Sykes, a black Akron Democrat who voted for the bill, said it addressed several serious problems facing the state.
"When a child is hungry, that child doesn't care if the person who feeds him is a Republican or a Democrat," Sykes said.
Sen. Lynn Watchmann, a Napoleon Republican who voted against the plan, said the bill's tax increases will hurt small companies.
"We're going to put them out of business," he said.
Republican Gov. Bob Taft said he was pleased with the plan. The governor, who can veto individual items, is going through the budget line by line, said spokesman Orest Holubec.
Taft must sign the budget by July 1, the first day of fiscal year 2004.
The sales tax increase raises Ohio's average sales tax from 6 percent to 7 percent.
Ohioans will also start to pay the sales tax on previously untaxed services, such as renting a storage locker, towing a car and having clothes dry-cleaned.
The plan spends $7.15 billion on schools next year, an increase of about 2.3 percent. The Department of Education said the figure, less than what the governor requested, could force districts to turn to voters for more money.
"Money matters, particularly when you look at the increased demands of the federal and state governments on public education," said department spokesman J.C. Benton. "Money has to be there to meet those demands."
The budget changes Ohio's current school funding method, which relies on a one-time head count in October and averages that over three years.
In the future, schools would count students twice, in October and March, and use a one-year average. The goal is to get a more accurate picture of student enrollment and give districts an incentive to boost attendance.
The budget also lowers the basic aid the state will guarantee schools for each student in 2004 from $5,088 under current law to $5,058. The change still reflects an increase over current funding.
Public colleges and universities, which lost hundreds of millions of dollars in spending cuts earlier this year, received an increase of less than 1 percent in the budget year beginning July 1 and less than 2 percent next year.
Meanwhile, the system expects to add about 16,000 new students for a 4½ percent enrollment growth, said Jamie Abel, spokesman for the Ohio Board of Regents.