Ohio House passes budget bill

Nicole Piscitani • April 21, 2025

The biennial budget process takes several months to complete; it is introduced in early February and ends by June 30. During that process, both the Ohio House and Ohio Senate work to amend the budget based on each chamber’s funding priorities. On April 9, the Ohio House completed its budget work by amending House Bill 96, the biennial budget bill, and voting it out by a 60-39 vote.

State funding formula
The Ohio House made several education-related changes, including how the state funds K-12 education. The House maintained the fair school funding formula in law, but made some changes for FY 26 and FY 27. The changes made were to ensure that every school district in the state receives more money than they received in fiscal year (FY) 2025. A district will receive its state funding based on the sum of the following:

• the district’s state foundation aid, less supplemental targeted assistance, for FY 25;
• an additional amount equal to 50% of the difference between the district’s foundation aid for the fiscal year and the district’s state foundation aid, less supplemental targeted assistance, for FY 25, if the difference is positive.

Additionally, the House included payments to ensure that growing districts receive more funds and that districts do not receive funding below their FY 25 funding. The bill language:

• Provides an enrollment growth supplement in FY 26 and 27 to districts whose enrolled ADM grew by at least 3% between FY 22 and FY 25 for FY 26 payments, and between FY 23 and FY 26 for the FY 27 payments.
  • The payment is calculated as follows:
    • Districts that grew between 3%-5% will receive $150 per student in FY 26 and $200 per student in FY 27
    • Districts that grew between 5%-10% will receive $100 per student in FY 26 and $150 in FY 27
    • Districts that grew more than 10% will receive $50 per student in FY 26 and $100 per student in FY 27

• Provides additional payments in FY 26 and 27 that guarantee a district’s temporary foundation funding does not fall below its FY 25 foundation aid, including supplemental targeted assistance.

Finally, the House included additional funding changes and requirements:

• Provides a base funding supplement in FY 26 and FY 27 equal to $20 per student in FY 26 and $30 per student in FY 27.
• Freezes the amount of special education funding withheld for high-cost special education students to what was withheld in FY 25.
• Requires districts to spend at least the amount that was spent in FY 25 in the following categories:
  • special education funding;
  • disadvantaged pupil impact aid (DPIA);
  • English learner funding;
  • gifted funds, excluding gifted professional development;
  • career-technical education and career-technical associated services funding;
  • student wellness and success funding.
• Maintains current law regarding required uses of student wellness and success funds.
• Prohibits any district from spending more than 15% of its annual operating budget on administrative salaries and benefits and other costs associated with the district’s administrative offices.
• Allows districts to use funds from the Student Support and Academic Enrichment program for numeracy, literacy, a safe and drug-free learning environment and healthy students using the success sequence curriculum.

Cash balance carryover
While the state funding formula provides additional revenue to all school districts, the House included a provision that will greatly impact over 500 school districts across the state. The bill would modify the requirement that the county budget commission (budget commission) reduce school district property tax rates based on the district’s carryover balance of previous fiscal year general fund expenditures. Districts that have a carryover balance greater than 30% would be subject to the budget commission mandate to modify the property tax rates. The bill also creates an earlier timeline for reviewing school district data and rate reductions and establishes a special timeline for FY 25 and tax year 2025. Lastly, the bill specifies that rate reductions only apply to that tax year and requires new language on the tax bill that explains the temporary rate reduction. The House also made two policy changes regarding the budget commission and the five-year forecasts:

• removes the county prosecutor from the budget commission and makes the president of the board of county commissioners a member instead;
• reduces the duration for school district operational revenue and expenditure forecasts from five to three years.

The cash balance carryover language is incredibly concerning. School districts should be contacting their state senators to not only communicate the impact of the bill but also to explain their cash balance story. Additionally, districts need to engage parents, businesses and all members of the community to let them know the impact to the school district, if this provision is enacted. Districts should encourage the community to help voice their concern to state senators.