Ohio city of Lima hosting State of the State

ANN SANNER JULIE CARR SMYTH Associated Press Published:

LIMA, Ohio (AP) -- Gov. John Kasich has already released his two-year spending plan, his school-funding proposal and his pitch to alter Ohio's tax structure, possible new topics for Tuesday night's State of the State speech are anyone's guess.

It's more likely the Republican governor will use the address to argue on behalf of his proposals with an eye toward his re-election campaign in 2014.

Kasich planned to deliver the speech, his third annual State of the State address, in the northwest Ohio city of Lima. It's his second in a row outside the Statehouse following last year's precedent-breaking speech in Steubenville in eastern Ohio.

Kasich was to devote part of his speech to his annual Governor's Courage Awards, going this year to the family of the late astronaut Neil Armstrong; to community members in Chardon, site of a school shooting a year ago; and to a woman who has worked to break stereotypes about autism.

One thing for certain is that Kasich will use the address to promote his $63.2 billion, two-year budget. The spending blueprint includes a new school-funding formula and expansion of the Medicaid government health-insurance program.

It also changes the tax code to lower rates on income, sales and small-business taxes while imposing sales taxes on many new services, including haircuts and sports tickets, and increasing the rate on high-volume oil and gas extraction.

State lawmakers and government officials descended on Lima in the midst of snowy and windy conditions Tuesday that limited a planned demonstration opposing Kasich's speech. But a handful of opponents stood near the site of the address to criticize the governor's proposals on education and changing the state's tax code.

Kasich pitched a "rosy" school-funding plan, but the district funding numbers told a different story, said Dan Greenberg, a high school teacher from Sylvania.

"They don't add up," Greenberg said. "The districts that need the money the most, the poor districts where the kids need the help ... they're not getting any money."

Legislative committees held hearings on transportation and workforce development earlier Tuesday in Lima. The Kasich administration also promoted aspects of the governor's $63.2 billion, two-year budget during stops in the area.

Inside the hall where the speech was held, lawmakers snapped pictures of each other and chatted ahead of the governor's speech. Kasich's wife, Karen, his budget director, Tim Keen, and Lt. Gov. Mary Taylor were among those with prime seating in front of the stage.

Last year, Kasich used Steubenville to highlight positives he said were taking place in economically hard-hit eastern Ohio, particularly surrounding K-12 education and oil and gas exploration.

In Lima, Kasich can focus on a manufacturing hub with significantly improved employment, which also sits in the heart of reliably Republican farm country. The new leader of the Ohio Senate that's sometimes blocks Kasich's plans, President Keith Faber of Celina, lives nearby.

Located about 80 miles south of Toledo, Lima was built around factories that made locomotives and school buses. Heavy industry still drives the city, home to an oil refinery, a Ford Motor Co. engine plant and the nation's only tank manufacturing plant. It's also the fictional setting of "Glee," the popular TV show about high school glee clubs.

Like many of Ohio's industrial cities, poverty is a problem in some neighborhoods, but the city's unemployment has been nearly cut in half from two years ago and now stands at 7 percent.