Tracked House Bills – January 2020
Bricker & Eckler LLP
Legislature Resumes End of January: The House and Senate have resumed Committee activity and will resume full Statehouse activity at the end of January. Priorities are likely to include:
- Capital Appropriations Bill: The bill will provide capital appropriations for FY 2021-2022 to fund maintenance and improvements to Ohio’s physical buildings and properties. Often, additional funding is available for community projects, and House Speaker Larry Householder has indicated that about $150 million will be available this budget cycle. The Legislature set a January 10 deadline for submissions for projects, and the bill should be passed by April 1.
- Sports Gambling: Several bills have been introduced to legalize sports gambling activities in Ohio. House Bill 194 would also create a Sports Gaming Advisory Board to oversee regulation, and it would fall under the purview of the Ohio Lottery Commission. Alternatively, Senate Bill 111 would permit the Ohio Casino Control Commission to regulate sports wagering. Stakeholders from the collegiate level continue to request that college athletics in the state be excluded from both measures. However, no amendments have been accepted on either bill to remove college athletics. Sports gambling will continue to be discussed and debated in 2020. While there is considerable interest in moving forward on the issue, the chambers need to agree on the regulatory body best suited to oversee sports gambling in the state.
- Gun Reform Legislation: Governor DeWine has announced several legislative reforms to address gun violence and increase mental health access and treatment. Senate Bill 221 includes many of the announced reforms, including modifications to the “pink slip” law that allows individuals to be committed for mental health treatment. S.B. 221 allows probate courts to grant safety protection orders which would deny an individual’s eligibility to have a firearm based upon evidence of that individual suffering from mental illness. Speaker Householder has voiced opposition to Senate Bill 221, preferring to focus on the House’s own plan in House Bill 354, which requires information be reported into the background check system. With a group organizing for a possible ballot issue on universal background checks, the conversation surrounding these policies will continue in 2020.
- Ohio’s Energy Policies: There are several noteworthy energy policy items that the Legislature may consider this year. House Bill 246 is a placeholder bill to reform and modernize the Consumers’ Counsel and the Public Utilities Commission. Although a draft of the bill is not yet available, PUCO Chairman Sam Randazzo has mentioned that he wants to address ratemaking and general revised code cleanup for the Commission. Language is expected to be revealed during the first quarter of 2020. House Bill 247 proposes changes to competitive retail electric service in Ohio by allowing electric distribution utilities to offer customer-focused energy services or products and expanding the use of smart grid technology. After several hearings and interested party meetings, a revised version of H.B. 247 will be unveiled in early 2020 addressing concerns raised by opponents of the legislation. Speaker Householder, referring to H.B. 247, recently mentioned that grid modernization is “the next step in terms of electricity and utilities in the state of Ohio.” The House may also continue hearings on House Bill 401, which creates a referendum process in townships on Ohio Power Siting Board Certificates issued for wind farms. Finally, Senate Energy and Public Utilities Chairman Steven Wilson aims to enact a comprehensive energy policy for the state. To do so, the committee is continuing to hold a series of informational hearings in 2020, with topics likely to include fuel diversity, grid modernization, and energy markets and pricing.
- H2Ohio: In H.B. 166, H2Ohio was created as a water quality initiative to find long-term solutions to ensure clean and safe water in Lake Erie and throughout Ohio. This program has sparked several other pieces of legislation. H.B. 7 creates the H2Ohio Trust fund and the H2Ohio Advisory Council to disburse dollars from the trust fund for water quality programs. H.B. 7 was introduced as a solution for long term funding of H2Ohio. However, the Senate has also introduced S.B. 2 which would create a permanent program to protect Ohio’s watersheds under the Ohio Department of Agriculture. Although H.B. 7 and S.B. 2 tackle different problems, both bills attempt to find a permanent solution for water quality controls in Ohio. The Legislature will attempt to come to an agreement in 2020 regarding Ohio’s policy focus for tackling water quality issues.
Bills Being Tracked: Changes from last month are noted below in bold.
HB 2 CREDENTIAL PROGRAMS (Cross, J., Lepore-Hagen, M.) This legislation introduced May 13 would provide $35 million in state funding in FY 2020 and FY 2021 for its programs, with funding allocated as follows:
- TechCred Program — $12.3 million a year to reimburse employers and individuals for training to receive a micro-credential, at the rate of $500-$2000 per credential;
- Industry Sector Partnerships Program — $2.5 million a year to support regional partnerships across the state, including a grant program to develop the partnerships and promote their mission.
The bill was revised then passed in the House June 12 and was referred to the Senate Finance Committee, where it was reported out of the Committee November 5 with numerous amendments. The amended bill was then sent back to the House, which refused to approve the amendments. A conference committee approved two amendments December 11 which would:
- change the bill’s language on the Individual Microcredential Assistance Program application process to:
–Clarify what information training providers must provide to the state on prospective students;
–Further define what costs must be submitted for approval, and
–Require providers to submit information on their plan to extend opportunities to unemployed or underemployed individuals, and
- increase the Individual Microcredential Assistance Program reimbursement cap from $2,000 to $3,000.
The Conference Committee’s recommendations were then approved by the Senate December 11 and by the House December 12. The bill was signed by the Governor January 13 at Grob Systems, Inc. in Bluffton.
HB 4 INDUSTRY CREDENTIALS (Richardson, T., Robinson, P.) This bill, introduced May 16 would permit the Governor’s Office of Workforce Transformation to develop industry-recognized credentials and certificate programs after being requested to do so by Ohio employers. The proposed credential or program must be aligned with the knowledge and skills necessary to meet Ohio’s workforce needs, and the Office of Workforce Transformation must consult with the Department of Education, the Chancellor of Higher Education, and other stakeholders while developing such credentials. The bill passed in the House June 6 and has been assigned to the Senate Transportation, Commerce & Workforce Committee where a second hearing with proponent testimony occurred October 9 and a third hearing is scheduled for November 20. The bill passed in the Senate December 12 and was signed by the Governor January 14.
HB 6 ENERGY (Callender, J., Wilkin, S.) This new law supports FirstEnergy Solutions’ nuclear plants by creating a surcharge beginning in 2021 to be paid by all Ohio electricity customers to be overseen by the Ohio Air Quality Development Authority (“OAQDA”). The legislation will provide the plants up to $150 million a year and eligible solar projects $20 million. The program would sunset December 31, 2026 with monthly customers’ charges capped at 85 cents for residential and $2,400 for large users. The bill also lowers the state’s renewable energy standards to 8.5% by 2026, enables the PUCO to end energy efficiency standards if the 17.5% target has been reached, and enables extension of cost recovery for the Ohio Valley Electric Corp.’s gas-fired plants. A petition to subject the new law to referendum by Ohio voters was approved by Ohio Attorney General Dave Yost and Secretary of State Frank LaRose in late August. Ohioans Against Corporate Bailouts (the group pursuing the referendum) is currently working to collect the 265,774 signatures needed by October 21 in order to get the issue on the November 2020 ballot. In the meantime, on September 4, FirstEnergy Solutions filed an action with the Ohio Supreme Court seeking to block the proposed referendum on the grounds that the surcharges constitute a tax and are thus not subject to referendum. On November 27, the Supreme Court dismissed that lawsuit on the grounds of “lack of a justiciable controversy.” In early October, Ohioans Against Corporate Bailouts filed a federal lawsuit challenging the constitutionality of the state’s referendum procedures and urging immediate suspension of a preregistration requirement for its signature gatherers. The suit also claims that tactics used by those opposing signature gatherers have constituted unlawful harassment. On October 11, the federal court issued a temporary restraining order blocking part of state law that requires some paid petition circulators to submit a form disclosing their identities or face criminal penalties, in response to Ohioans Against Corporate Bailouts’ allegations that the requirement is a burden to the First Amendment’s right to free speech. On October 21, Ohioans Against Corporate Bailouts failed to submit the required number of signatures to place a referendum on the November 2020 ballot. The group requested more time to gather signatures in its federal lawsuit, but this request was denied by the judge. The group has asked the Ohio Supreme Court to consider the constitutionality of state law which required certain procedures which the group says denied it a full 90 days to collect petition signatures. That Supreme Court case is still pending. House Bill 6 took effect October 21. On December 20, the Federal Energy Regulatory Commission (FERC) ordered the regional transmission organization PJM to expand its minimum offer price rule to compensate for energy resources backed by state subsidies. The order is apparently a response to energy subsidies in HB 6 and those offered in other PJM states. The order essentially limits how low an energy resource receiving state subsidies can bid into the capacity market and was necessary, according to FERC, to provide a level playing field for all energy resources. The PUCO apparently plans to file a request that FERC reconsider its decision.
HB 7 WATER FUND (Ghanbari, H., Patterson, J.) This bill, introduced May 13, would create the H2Ohio Trust Fund for the protection and preservation of Ohio’s water quality, create the H2Ohio Advisory Council to disburse money from the Fund for water quality programs, and create the H2Ohio Endowment Board to make recommendations to the Treasurer of State regarding the issuance of securities to pay for costs related to the purposes of the Fund. The bill authorizes the H2Ohio Advisory Council to disburse up to $50 million per fiscal year by issuing loans and awarding grants to applicants that apply for money to address water quality issues in Ohio. If Fund money is appropriated specifically to the Department of Natural Resources, Department of Agriculture, or the Environmental Protection Agency, it requires the Directors of those state agencies to each prepare an annual plan detailing how the money will be spent. It also requires the Council to review and approve each agency’s annual plan before the agency may spend the appropriated money. The bill was referred to the House Finance Committee where a substitute bill was approved on June 18. The revised bill passed in the House June 20 and would increase the cap on the annual disbursement of funds from $50 million to $100 million and eliminate the creation of the H2Ohio Advisory Council, instead vesting authority over the disbursements in the Ohio Water Development Authority. It also included a provision allowing the Department of Natural Resources to establish a pilot program to study water withdrawals by using streamflow monitoring in Eastern Ohio and another provision which enables the Controlling Board to approve or deny an amount recommended by the director of the Office of Budget Management for year-end unspent balances. It has been referred to the Senate Finance Committee where a first hearing with sponsor testimony occurred October 22.
HB 13 BROADBAND (Carfagna, R., O’Brian, M.) Introduced May 16, this bill is based on a proposal that passed the House last year (HB 281, 132nd GA) and would require the Development Services Agency (DSA) to establish the Residential Broadband Expansion (RBE) Program to provide grants to municipal corporations and townships (project sponsors) to help fund projects that provide broadband to any residential area within their boundaries that is without broadband (eligible area). It excludes as an eligible area under the RBE Program, any area that has received, or is designated to receive, any other state or federally funded grants that are designed to encourage broadband deployment. The program would allow the Director of DSA to accept applications from project sponsors each fiscal year, review each application within 60 days, and fund applications on a first-come, first-served basis until all program funds for the fiscal year are awarded. Program funds, up to $2 Million per biennium, would come from currently-budgeted DSA funds. It has been referred to the House Finance Committee where a third hearing occurred June 19.
HB 34 MINIMUM WAGE (Kelly, B.) This bill would increase the state minimum wage and allow municipalities, townships and counties to establish higher minimum wage requirements. The bill has been referred to the House Commerce & Labor Committee, where initial hearings occurred January 22 and 23, 2020.
HB 48 ROAD IMPROVEMENT FUND (Greenspan, D.) This measure would provide for a new Local Government Road Improvement Fund for local governments to fund road improvements. It has been referred to the Finance Committee.
HB 93 PUBLIC TRANSPORTATION (Skindell, M., Upchurch, T.) Introduced February 21, in addition to any appropriations made for the 2020-2021 biennium, this bill would make additional appropriations related to public transportation in the amount of $100 million for public transportation and $50 million for the highway operating fund in both 2020 and 2021. The bill has been referred to the House Finance Committee.
HB 98 LOAN FUND (Jones, D., Cera, J.) Similar to HB 695 introduced in the last General Assembly, this bill would reinstate the rural industrial park loan program under Ohio Development Services Agency, as detailed in ORC 122.23-.25, with an appropriation of $25 million. The program would assist eligible applicants in financing the development and improvement of industrial parks by providing financial assistance in the form of loans and loan guarantees for land acquisition; constructing, reconstructing, rehabilitating, remodeling, renovating, enlarging, or improving industrial park buildings; and infrastructure improvements. The bill has been assigned to the House Economic & Workforce Development where it had its first hearing March 27. The provisions of this bill were included in the signed Budget Bill (HB 166).
HB 116 TRANSPORTATION PLANNING (Brinkman, T.) Introduced March 4, in addition to any appropriations made for the 2020-2021 biennium, this bill would make additional appropriations related to transportation planning and research in the amount of $4.5 million for FY 2020 which shall be used to (1) study the Cincinnati Eastern Bypass Project, (2) review work done previously by the Kentucky Transportation Cabinet relative to the Brent Spence Bridge Project, and (3) make recommendations on moving forward with both projects cooperatively. The bill has been referred to the House Finance Committee.
HB 149 TAX EXEMPTION (Merrin, D.) Introduced March 19 and identical to HB 371 from the last General Assembly, this bill would amend ORC 5709.51 among other code sections and temporarily exempt from property tax the increased value of land subdivided for residential development until construction commences or the land is sold. The bill would benchmark an “ascribed taxable value” of the newly subdivided parcel, and any increase in taxable value would be exempt from taxation until either (1) Construction of a residential building on that property commences, or (2) Title to the property is transferred for consideration by a qualifying owner to another person. The construction of streets, sidewalks, curbs, or driveways or the installation of water, sewer, or other utility lines on a subdivided parcel would not cause construction of a residential building to commence for purposes of the bill, and the value of those improvements would thus automatically be exempted from taxation until construction of a residence begins or the property is sold. The bill was referred to the House Economic and Workforce Development Committee, and its provisions were then included in the Conference Committee version of the state budget bill, HB 166. However, after concerns were expressed by numerous local government groups including the Mid-Ohio Regional Planning Commission, the Ohio Library Council, the Ohio Association of School Board Officials, the Ohio Township Association, the County Commissioners Association and the County Auditors Association, Governor DeWine line-item vetoed the provisions of the bill.
HB 162 TAX CREDIT (Patton, T.) This bill would increase the overall cap on the motion picture tax credit from $40 million per fiscal year to $100 million per fiscal biennium. The bill has been referred to the Finance Committee.
HB 163 WATER/SEWER SERVICE (Brinkman, T.) This bill, introduced March 25, 2019 would create a process for withholding local government funds and state water and sewer assistance from municipal corporations that engage in certain water and sewer practices with respect to extraterritorial service. The bill was referred to the House Public Utilities Committee, where 5 hearings have occurred. On September 26, the committee accepted three amendments. The first would specify that the civil action referenced in the bill is a declaratory judgment action. The second would create a safe harbor for municipalities charging no more than 25% above rates charged to residents. The third would final ensure the bill has no effect on existing contracts.
HB 166 STATE BUDGET BILL (Oelslager, S.) This is the Biennial Budget Bill which was enacted July 18.
HB 168 BONA FIDE PURCHASER (Arndt, S.) This bill should assist with brownfield development by incorporating into Ohio law the federal Bona Fide Purchaser Defense (BFPD) established under CERCLA, which provides prospective buyers of contaminated property with an option to establish a defense to environmental liability after completing the All Appropriate Inquires and proper due diligence. The bill passed the House May 30 and had its third hearing November 13, where an amendment was approved that would provide the director of the Ohio Environmental Protection Agency the ability to issue an order voiding a covenant not to sue if a property subject to institutional controls or use limitations fails to comply with those requirements. A fourth hearing occurred December 4, and the bill was reported out of Committee.
HB 185 JOBSOHIO (Ingram, C.) Introduced April 4, this bill would establish that records kept by JobsOhio are public records subject to inspection and copying under Ohio Public Records Law and to require all meetings of the JobsOhio Board of Directors to be open to the public, except when in an executive session. It has been referred to the Economic and Workforce Development Committee where a first hearing occurred May 15.
HB 190 BROADBAND PROGRAM (Smith, R.) This bill, introduced May 9 and identical to HB 378 which passed in the House during the 132nd GA, would create the Ohio Broadband Development Grant Program to provide funds to extend broadband service to unserved areas of the state. The program would be administered by the Ohio Development Services Agency. The following entities could apply for a grant: (1) private businesses, (2) political subdivisions, (3) nonprofit entities organized to provide telecommunications services, and (4) co-ops organized to provide phone and Internet services. Grant amounts cannot exceed the lesser of: (1) 50% of the total project cost, or (2) $5 million. Recipients could use funds to construct broadband infrastructure to serve unserved areas, including installing middle-mile or last-mile infrastructure, grant-project planning, obtaining construction permits, constructing facilities, purchasing equipment, and installing and testing the service. The bill would appropriate $50 million per year for FYs 2020 and 2021 from the Facilities Establishment Fund, to be used to award grants under the Program. It has been referred to the Finance Committee.
HB 218 PUBLIC-PRIVATE AGREEMENTS (Patton, T.) Introduced April 24, this bill would authorize certain public bodies, including state agencies, state institutions of higher education, counties, townships, municipal corporations, school districts, community schools, STEM schools, college-preparatory boarding schools, library districts, and port authorities, to execute a public-private agreement (“PPA”) with a private party for the planning, acquisition, financing, development, design, construction, reconstruction, replacement, improvement, maintenance, management, repair, leasing, or operation of a “facility”. “Facility” is defined to include a new or existing public building, public improvement, or public infrastructure used by a public body, by the public at large, in support of a public purpose, or for the delivery of services, and it must be owned by the public body or owned by the private party through a lease agreement under which the facility reverts to the public body upon expiration of the agreement. A public body that has authority to issue bonds/obligations may issue them for the purpose of funding the development or financing of a facility under a PPA. A public body may accept a grant, loan, or other financial assistance from the United States or any of its agencies or may enter into agreements with the United States as necessary to fund the facility. A public body may also accept from any source any grant, donation, gift, or other form of conveyance of land, money, other real or personal property or other items of value, and the public body may use federal, state, local, and private funds to finance a facility. Finally, a facility may be financed in whole or in part by contribution of any funds or property made by any operator or an affected jurisdiction that is a party to a PPA. The bill has been referred to the State and Local Government Committee where a second hearing occurred June 19.
HB 247 ELECTRIC SERVICE (Stein, D.) Introduced May 15, this bill would permit electric distribution utilities (EDUs) to offer customer-focused energy services or products, which may include energy efficiency, energy monitoring, electric vehicle charging stations, the installation and management of smart grid technology, and other items. These products may be offered if either the PUCO has approved them under certain sections of the Ohio Revised Code or the products are optional, the EDU maintains separate accounting for the products, and the EDU does not include incremental costs directly related to the products in base distribution rates but instead recovers incremental costs through charges to customers who elect to subscribe to those services. The bill would also allow an EDU’s electric security plan to include provisions for the EDU’s recovery of costs for the products and smart grid technology deployment, including lost revenue, shared savings, and avoided costs, and a just and reasonable rate of return on smart grid technology deployment. Additionally, it would lift the corporate separation requirements that currently apply to the offering of a product or service other than retail electric service, effectively allowing an EDU to offer such a product or service directly, rather than through a fully separated affiliate.
Finally, it authorizes nonbypassable electric riders for: (1) infrastructure development costs for state and local economic development projects and (2) facilities of mercantile customers that are locating or expanding in Ohio. The bill grants an EDU timely recovery of infrastructure development costs necessary to support or enable a state or local economic development project, including any project approved, certified, or funded by “the agency” (presumably the Development Services Agency). The bill defines “infrastructure development costs” as any cost of infrastructure development, including, if applicable, an allowance for funds used during construction. The bill defines “infrastructure development” as the planning, development, and construction of substation facilities and extensions of transmission or distribution facilities that an EDU owns and operates and the performance of load studies. The bill requires the EDU, before beginning the infrastructure development, to file a notice with the PUCO that contains all of the following:
- A description of the economic development project;
- A summary of the infrastructure development costs;
- A statement from the state or local entity involved that the infrastructure development is necessary to support or enable the economic development project.
The costs are to be recovered through a nonbypassable rider charged to all distribution customers regardless of whether the infrastructure development is used and useful at the time constructed.
The bill also expands the definition of “smart grid” to include capital investment in equipment deployed in conjunction with an EDU’s distribution infrastructure that facilitates intelligent city designs, such as traffic sensors, infrastructure monitoring equipment, data management systems, and similar technology as well as the deployment, adaptation, replacement, or subsequent reinforcement of any technology that facilitates the storage, control, or delivery of electric energy.
A third hearing on the bill occurred October 23 in the House Public Utilities Committee, where opponent testimony was heard from the OMA, IGS, Direct Energy, ChargePoint, the Environmental Law & Policy Center, the Ohio Environmental Council, the Consumers Council, the Retail Energy Supply Association and others.
HB 255 TAX EXPENDITURES (Hoops, J.) Introduced May 23, this bill would require the Tax Commissioner’s biennial tax expenditure report to include information on local property tax exemptions and to require the Tax Expenditure Review Committee to periodically review each such property tax exemption. It has been referred to the Ways & Means Committee where a third hearing occurred October 29.
HB 264 INFRASTRUCTURE LOANS (Wilkin, S., O’Brien, M.) Introduced May 28, this bill would authorize the Ohio Water Development Authority (OWDA) to make loans and grants to persons and government agencies for the refinancing of certain public water and waste water infrastructure projects. The bill also authorizes the OWDA to issue water development revenue bonds and notes for the purpose of paying any part of refinancing of these projects. The bill was passed by the House December 12 and now moves to the Senate.
HB 283 GRANT PROGRAM (Miller, A., Sweeney, B.) Introduced June 11, this bill would require JobsOhio to establish and administer the Competitive Global Air Service Development Grant Program. Under the program, JobsOhio would be required to:
- Provide grants to air carriers to support the establishment of new direct international and domestic air service to and from Ohio airports;
- Ensure that grants made under the program provide minimum revenue guarantees and marketing assistance to air carriers;
- Give priority consideration to air carriers that propose to establish new direct air service between Ohio and destinations located in the European Union or Japan;
- Establish eligibility requirements; and
- Prepare, and submit to the General Assembly, a written report not later than the last business day of January of each year detailing all aspects of the program occurring during the immediately preceding year.
The bill has been assigned to the House Economic and Workforce Development Committee.
HB 382 MUNICIPAL TAXES (Jordan, K.) Introduced October 29, this bill would prohibit municipal corporations from levying an income tax on nonresidents’ compensation for personal services or on net profits from a sole proprietorship owned by a nonresident.
HB 386 TRUCK DRIVER STUDENTS (Hoops, J., Sobecki, L.) Introduced November 5, this bill would establish the Commercial Truck Driver Student Aid program and make an appropriation. It was referred to the Economic & Workforce Development Committee where a first hearing occurred December 11.
HB 401 WIND REGULATIONS (Reineke, B.) Introduced November 6, this bill would apply to “economically significant wind farms” and would require inclusion of certain safety specifications in wind farm certificate applications to the Ohio Power Siting Board, would modify their wind turbine setback requirements and would permit a township referendum vote on these wind farm certificates issued by the Siting Board. The bill defines that term as already defined in ORC 4906.13, which is as follows: “economically significant wind farm” means wind turbines and associated facilities with a single interconnection to the electrical grid and designed for, or capable of, operation at an aggregate capacity of five or more megawatts but less than fifty megawatts.” The term excludes any such wind farm in operation on June 24, 2008. The term also excludes one or more wind turbines and associated facilities that are primarily dedicated to providing electricity to a single customer at a single location and that are designed for, or capable of, operation at an aggregate capacity of less than twenty megawatts, as measured at the customer’s point of interconnection to the electrical grid. If passed, the legislation would enable township residents by referendum to overturn a wind project already approved by the Ohio Power Siting Board. Amendments to approval certificates from the Power Siting Board for existing turbine projects would also be subject to potential referendum if they add more turbines, increase the height of a turbine or the diameter of a turbine tower’s base, or relocate any turbine. The bill also revises wind turbine setbacks with the distance to be equivalent to the manufacturer’s safety recommendations rather than current law which provides the greater of either 1.1 times total turbine height or at least 1,125 feet from the tip of the nearest blade to the property line of the nearest adjacent property. The bill has been assigned to the House Energy & Natural Resources Committee, where a first hearing occurred November 13 and a second one is scheduled for November 19. Senator Rob McColley has introduced companion Senate Bill 234. A third hearing occurred December 3 at which lawmakers discussed possibly revising the bill to move a proposed township referendum process to the Power Siting Board.
HB 440 TAX EXEMPTION (Miranda, J., Carruthers, S.) Introduced December 9, this bill would authorize sales tax exemptions for property and services used to clean or maintain manufacturing machinery and for employment services used to operate manufacturing machinery. It has been referred to the Ways & Means Committee.
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