Ohioans could soon see prices at the pump fall temporarily after state lawmakers passed a 90-day pause of the state’s gas tax on Wednesday.
The Ohio House and Senate passed House Bill 519 on Wednesday in a pair of bipartisan votes. The bill will suspend Ohio’s assessment of its 38.5-cent-per-gallon tax on gas, and its 47-cent-per-gallon tax on diesel. The bill also pulls $725 million out of the state’s reserve accounts to cover the lost road-and-bridge maintenance funding that will occur as a result of the tax holiday.
The bill now heads to Republican Gov. Mike DeWine’s desk for his signature. Normally, laws take effect 90 days after they are passed. But the gas-tax bill will take effect immediately if and when DeWine signs it, since it got enough Democratic support to add what’s called an emergency clause.
Last week, DeWine voiced skepticism about an earlier version of how to fund the tax break. But now that it’s funded via general budget dollars and not those earmarked specifically for road repairs and construction, DeWine plans to sign the bill, his spokesman said on Wednesday afternoon.
Ramaswamy revives stalled tax holiday idea
Republicans have debated suspending the state’s gas tax since earlier this year, after the U.S. invasion of Iran in February led to a spike in gas prices due to the resulting disruption in global oil shipping. But the measure failed to advance. Legislative leaders said Wednesday some Republicans thought at the time that perhaps that prices had spiked temporarily.
But the idea landed on the Republican-controlled legislature’s front burner last week after it became a top issue in the governor’s race.
Nine days before Wednesday’s vote, both gubernatorial candidates – Republican Vivek Ramaswamy and Democrat Amy Acton – called for passage of a gas tax holiday within hours of one another.
The same day, Midwest diesel prices reached an all-time high of $6.68 a gallon, while regular gas prices reached their highest levels since May, according to federal data. Republicans’ polling numbers, meanwhile, have plunged just as gas prices have started to go up.
Republican legislative leaders heeded the call, calling members back to Columbus on Wednesday for an unexpected vote. The resulting legislation was added to an unrelated bill that previously had to do with deterring auto theft.
At times the legislative process grew contentious. Senate Republicans invoked a rarely used procedural maneuver to squash debate on the bill and block Democrats from proposing amendments on unrelated, politically charged subjects. And in the House, GOP Speaker Matt Huffman repeatedly cautioned Democrats that their floor speeches could be cut off if they deviated too far from the bill.
“We tried to offer amendments. Obviously they won’t let us,” said Rep. Munira Abdullahi, a Columbus Democrat.
Republican Senate President Rob McColley, Ramaswamy’s running mate, described the restrictions as needed to keep debate on the topic.
“If we would have gotten bogged down with a lot of other stuff solely for political theater…, it would have, quite frankly, been a disservice to Ohioans,” McColley said.
The idea to suspend gas taxes was dusted off and then passed within nine days – a breakneck pace by typical legislative standards. Speaking with reporters following the vote, Ramaswamy called the episode a preview of how he’d govern the state.
“We’re going to be focused. We’re going to be substantive. And we’re going to be fast,” Ramaswamy said.
Tax holiday splits Democrats
Democrats took two major tacks on Wednesday when it came to the gas tax holiday legislation. Regardless of how they voted, most said in floor speeches and in interviews that they believed between 30% and 60% of the savings would not be passed on to customers and instead stay with the oil and gas industry or retailers.
Those who voted for the bill credited Democratic gubernatorial candidate Amy Acton for helping come up with the idea, since Acton called for her own gas-tax holiday hours before Ramaswamy did. After the bill passed Wednesday, the Acton campaign released a statement praising the vote’s outcome.
“As the first candidate in this race to propose a gas tax holiday, Dr. Acton is glad the Statehouse has voted with bipartisan support to establish a gas tax holiday and provide Ohioans much needed relief at the pump,” the statement said.
Some Democrats also quibbled with aspects of the bill, criticizing it for not dealing with broader issues like property taxes or data centers, or for pulling from state reserve funds instead using $600 million the state previously agreed to use to build a new Cleveland Browns football stadium.
Other Democrats more critical of the Republican proposal called the tax holiday a gimmick that would only save Ohioans a few dollars while politically benefitting Ramaswamy and other Republicans ahead of the election. They also said it ignores the real culprit of surging gas prices – the U.S. war on Iran.
“This is a stunt,” said state Rep. Allison Russo, who’s also the Democratic candidate for Ohio Secretary of State. “It’s a stunt because you’re worried about what’s going to happen in 35 days.”
Rep. Terrence Upchurch, a Cleveland Democrat, said in an interview he’s confident he can explain what looks like a tough vote against the always-popular idea of a tax break.
“This is temporary relief, there are no guardrails for consumers, and this is just irresponsible,” he said.
Still, enough Democrats voted for the bill to hand Republicans a crucial victory – to attach the emergency clause that allows the law to take effect immediately, which could lead to a drop in gas prices before early voting starts on Oct. 6.
Some Democrats described their belief that Acton’s team wanted the bill to pass and urged Democratic caucus leaders to vote for it.
“A lot of Democrats are a frustrated ‘yes,’” said Abdullahi, who voted no.
Dani Isaacsohn, the House Democratic Minority Leader, told reporters Wednesday that he spoke to Acton about the gas tax holiday proposal “at length.” He then laid out the sequence of events – Acton’s proposal followed by Ramaswamy’s legislative push hours later.
“She is centering the relief that people need, and she recognizes even before she’s in office that it’s time to start taking people’s needs seriously,” Isaacsohn said.
