Tracked House Bills – March 2023

135TH GENERAL ASSEMBLY – PROPOSED & ENACTED LEGISLATION
(Changes from last month are noted in italics):

HOUSE RESOLUTIONS:
Nothing relevant to economic development introduced as of this writing.

HOUSE BILLS:

HB 1 PROPERTY/INCOME TAX (Mathews, A.)  Introduced on February 15, 2023, this bill modifies existing law regarding property taxation and income tax rates.  The bill is designed to flatten Ohio’s personal income tax by eliminating various brackets and instead impose a rate of 2.75% on income over $26,050.

Specifically, the measure makes an important change to Ohio’s real property taxation scheme: it would reduce taxable value to 31.5% of true value (under current law, all real property is taxed at 35%, known as its “assessed value”).  (See proposed change to R.C. 5715.01(B))  Further, the Ohio Tax Commissioner is charged with making an annual calculation based a Gross Domestic Product (GDP) “deflator,” meaning that taxable value (i.e., assessed value) could be no higher than 31.5%, but could be lower, with no floor established.

 For a deeper analysis of HB 1’s proposed changes to Ohio’s property tax scheme, please see the attached Appendix.

 On March 14, the House Ways & Means Committee held its third hearing on the measure.

HB 2  ECONOMIC GROWTH AND DEVELOPMENT (Cutrona A., Upchurch, T.)  Introduced on February 15, 2023, this bill declares the intent of the General Assembly to direct state funds to projects across the state for economic growth and community development

HB 3 AFFORDABLE HOUSING (Mathews, A.)  Introduced on February 15, 2023, this bill states it is the General Assembly’s intention to authorize an affordable housing tax credit.

Bill sponsor Rep. Gail Pavliga (R-Atwater) intends this measure to mirror HB560, which was introduced during the 134th General Assembly.

Specifically, this measure will authorize a state LIHTC tax credit, up to $50MM, to piggyback off the federal credit, and it will incorporate OTAX-recommended language to address implementation hiccups.

Rep. Pavliga said the federal incentive includes a 9% credit and 4% credit. The former is awarded competitively, while the latter is financed in part through tax-exempt bonds.  The sponsor noted the latter’s allocation of volume cap bonds (approx. $120MM) for multi-family development often goes unused due to a lack of interest by private developers.

On March 14, the House Economic & Workforce Development Committee held its second hearing, at which it accepted a substitute version of the bill offered by Rep. Mark Johnson (R-Chillicothe). 

HB 12 EDUCATION AND WORKFORCE (Jones, D. Dobos, D.)  Introduced on February 15, 2023, this bill renames the Ohio Department of Education as the Ohio Department of Education and Workforce and creates the position of Director of Education and Workforce.  The bill also makes larger reforms of the State Board of Education and the role of the Superintendent of Public Instruction.  Note the companion bill in the upper chamber (SB 1).

On March 7, the House Primary & Secondary Education Committee held its third hearing and amended the measure to set minimum qualifications for the new agency’s deputy directors.

 HB 23  TRANSPORTATION BUDGET (Edwards, J.) Introduced on February 15, 2023, this is the State’s transportation bill, thereby appropriating $12.6B for programs during the State Fiscal Year (SFY) 2024 – SFY 2025 biennium.

 An amended substitute cleared the entire House on March 1; on March 21, the Senate Transportation Committee held its sixth hearing on the measure; a substitute version of the bill was adopted on March 15.

 The substitute version removed the House’s approved language that would have created a $1B new Rural Highway Fund.  The Senate is of the view the $1B should remain in the General Revenue Fund; analysis showed the Fund would only apply to a dozen or so projects across Ohio.

 Interestingly, the substitute version also removed a provision that would allow for the sale of the Cincinnati Southern Railway, the only municipally owned railroad in America.

 Appropriation line items of interest:
Among its provisions, this bill appropriates:

• $15.2MM/year to ODOD for 629 Roadwork Development Grants
• $124.6MM during the biennium to the Public Works Commission for the Local Transportation Improvement Program (LTIP)

Substantive law changes of interest:
The bill would :

• Prohibits park district property from being included in a special improvement district (SID), similar to the continuing exclusion for county, township, municipal, state and federal property, unless the park district consents to its inclusion
• Enable multiple regional transit authorities to collaborate in providing workforce transit among territories to and from economically significant employment centers
• Mandate that trains operate with two-person crews
• Analyze transportation links between Columbus and Sandusky as part of ODOT’s Strategic Transportation and Development Analysis, which must be completed by Dec. 31, 2024
• Specify that any plan for high-speed passenger transportation must provide connection points determined by the Ohio Rail Development Commission, rather than provide connections to Cleveland, Columbus, and Cincinnati

HB 31  WORKERS’ COMPENSATION (Edwards, J.) Introduced on February 15, 2023, this bill, among other changes to the State’s workers’ comp. system, renames the Ohio Bureau of Workers’ Compensation to that of the Ohio Department of Workforce Insurance and Safety.

On March 8, the House Insurance Committee held its second hearing on the measure.

 HB 33  OPERATING BUDGET (Edwards, J.) Introduced on February 15, 2023, this is the State’s biennial budget bill, for SFY 2024 – SFY 2025.

During February and March, various House Finance Subcommittees held hearings on the measure.

 Appropriation line items of interest:
Among its provisions, this bill appropriates:

• $2.5B to ODOD to create the All Ohio Future Fund for site-readiness and preparation, to be funded via “accumulated one-time GRF.”

HB 85  LAND BANKS (Patton, T.)  Introduced on February 28, 2023, this bill seeks to expand the methods by which land banks can acquire delinquent property.

HB 96  MINIMUM WAGE (Jarrells, D. Mohamed, I.)  Introduced on March 7, 2023, this bill seeks to increase the state’s minimum wage.