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Trust-Fund Plan Drawing Few Supporters in Ohio

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Gov. Richard F. Celeste's proposal for a constitutional amendment to raise $1.8 billion in new taxes to create a "trust fund" for Ohio's schools has drawn a lukewarm response from his fellow Democrats in the legislature and harsh criticism from Republicans.

When legislation to place the issue on a statewide ballot next fall was introduced in the House last month as a "courtesy" to Mr. Celeste, only three Democratic lawmakers agreed to sign on as sponsors.

"The Governor appeared to be having trouble finding sponsors, but I felt his proposal should be heard," said Representative William E. Hinig, chairman of the House finance and appropriations committee and one of the cosponsors.

House Speaker Vernal G. Riffe Jr., meanwhile, has declined to take a stand on the proposal, and has said that House Democrats will not take a position as a group on the issue.

Recently, House Republicans issued a statement declaring the plan "dead on arrival."

The Republican caucus believes the Governor's proposed tax increases would "hurt the state economy and therefore hurt schools more in the long run," explained Jacqui Romer-Sensky, a spokesman for the lawmakers. They plan to introduce a measure within the next two weeks that would "re-prioritize" existing funds, she said.

Observers said the main obstacle standing in the way of Mr. Celeste's plan is the fact that lawmakers of both parties are extremely reluctant to support a tax increase.

Moreover, "Governor Celeste's coattails are shorter than an Eisenhower jacket," one education official noted. "He just has no great allegiance in the General Assembly."

However, Carla Edlefson, Mr. Celeste's education aide, denied claims that the Governor was facing a dead end. "There's a lot of posturing going on," she said. "I don't think such jockeying is so unusual."

The Governor's plan calls for a 1 percent increase in state income and corporate taxes, which would raise education funding by $1.8 billion over two years. Two-thirds of themoney would be earmarked for reform projects in elementary and secondary schools.

All of the new revenues would be placed in a trust fund controlled by an independent "education excellence commission." The measure would require changes in the Ohio constitution and thus would have to be approved by the state's voters.

The decision to place the proposal on the ballot has upset many of Ohio's leading education organizations.

"We do not support going to the ballot on this issue," said Marilyn Cross, president of the Ohio Education Association.

"We think the legislature has the ability to provide more money on its own," she said, adding that union leaders doubt that voters can be persuaded to approve higher taxes.

Ms. Cross also argued that the Governor's proposal does not address what the oea considers the state's most pressing need in education: the development of a new school-aid formula that would reduce sharp disparities in spending among districts.

Although the organization is not opposed to the idea of an education trust fund, she said, "we feel the money should go to the basic-educa8tion fund to reduce these inequities."

G. Robert Bowers, assistant state superintendent for public instruction, said state officials oppose the trust fund because it would be controlled by a new panel and not the state board of education. He said the board also disagrees with the decision to put the issue before voters.

He noted, however, that state officials are pleased that the governor has embraced many of the state board's recommendations for improving schools, including the expansion of early-childhood and preschool education, encouraging business partnerships with schools, and increasing parental involvement.

According to Ms. Cross, Mr. Celeste has responded to the lack of support from the education lobby by turning to Ohio's business community--despite the fact that the proposal includes a corporate tax increase.

"The business community hardly flinched about that tax, especially since they are so concerned about the quality of education in the state," Ms. Edlefson said.

But even with support from business, many still doubt whether the Governor can push the bill through the legislature.

Representative Hinig, however, said the bill was "not yet totally dead in the water."

Mr. Hinig said the legislation has been referred to the ways and means committee. But, he added, no action is expected until after the state budget is approved and until House leaders receive some indication of support from the Senate.

"I would not want to ask House members to work on legislation that will not be received in the Senate," he said.

In a related development, the Senate has passed legislation that would allow all but the largest urban districts to ask voters to approve a local income tax of up to 1 percent.

The bill, which will now go to the House, would give districts the option of taxing income, rather than relying completely on property taxes, as they do currently.

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