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More tax credits, spending in Obama’s budget plan

Boehner calls Obama budget ‘most irresponsible’ yet.


President Barack Obama Tuesday proposed a $3.9 trillion budget for the federal spending year that starts in October, urging Congress to approve a major expansion of a program that provides a substantial federal tax credit for low-income Americans who have jobs.

In a budget that quickly encountered criticism from congressional Republicans, Obama wants to spend $60 billion during the next decade to expand the Earned Income Tax Credit, known as the EITC and which provides hundreds of additional dollars every year to working families.

In a proposal that could impact the National Aviation Heritage area in Dayton, the budget cuts spending for so-called heritage areas — from $18 million to $9 million. The administration attempted to cut the same program last year, but Congress restored the money.

In addition, the budget includes $35 million to help renovate a federal building in downtown Cincinnati that houses the Internal Revenue Service. It boosts spending for the U.S. Department of Veterans Affairs by 3 percent. That finances the Dayton VA facility.

The White House budget also includes $160 million for continued clean-up of the former nuclear site at the Portsmouth Gaseous Diffusion Plant in southeast Ohio. In addition, the budget includes $104 million for both Portsmouth and a similar plant in Kentucky to help re-use depleted uranium waste at the two facilities.

The clean-up money is separate from $118 billion approved by Congress in January for a Maryland company that wants to launch a uranium enrichment facility at the Portsmouth facility, which is near Piketon, Ohio.

The budget cuts $430 million from the Clean Water State Revolving Fund, including more than $150 million to Ohio and seven other states, according to the National Wildlife Federation’s Great Lakes Regional Center.

The fund helps cities and regions fix and upgrade wastewater infrastructure to keep sewage overflows from running into the Great Lakes and the rivers and streams that lead into them.

In his budget, Obama proposes doubling the Earned Income Tax Credit for childless workers from $500 to $1,000 and lower the age of eligibility for workers from 25 to 21. To finance the expansion, Obama wants higher taxes on wealthy investors who run private equity funds.

If Congress approved the plan, nearly 8 million workers would qualify for the larger credit while 5.8 million workers would become eligible for the first time. The expansion would impact about 500,000 people in Ohio, either through a larger tax credit or new eligibility.

In a speech at an elementary school in Washington, Obama said “the most effective and historically bipartisan ways to reduce poverty and help hardworking families pull themselves up is the Earned Income Tax Credit.’’

Democrats such as Sen. Sherrod Brown of Ohio hailed Obama’s call to expand the EITC, saying that “as we continue our economic recovery, it’s vital that we pursue policies that reward Americans for hard work and provide them greater opportunities. We can accomplish this by strengthening the EITC and expanding its eligibility to workers without children.”

But Obama disappointed advocates of smaller deficits by avoiding new spending restraints on the entitlement programs of Social Security, Medicare and Medicaid. By doing so, the White House acknowledged the government will run annual deficits in excess of $400 billion annually through 2024.

“After years of fiscal and economic mismanagement, the president has offered perhaps his most irresponsible budget yet,’’ said House Speaker John Boehner, R-West Chester Twp. “In the president’s vision for our future, America’s budget never balances – ever.’’

Sen. Rob Portman, R-Ohio, said that “rather than laying out a path to address our economic challenges and spur job creation, this budget increases spending next year alone by $100 billion, dramatically raises taxes by $1.2 trillion, and adds $8.3 trillion to our national debt.’’



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