Tracked Senate Bills – October 2017

Chris Schmenk
Bricker & Eckler LLP

Amidst campaigns, ballot issues and preparations for Election Day on November  7, the Legislature has continued its important work.  New bills and changes are noted below in bold.

SB 3  WORKFORCE DEVELOPMENT (Beagle, B., Balderson, T.)  Originally, introduced in January, a substitute bill was introduced in April that would revise the laws governing the state’s workforce development system, programs that may be offered by primary and secondary schools, certificates of qualification for employment, and the Opportunities for Ohioans with Disabilities Agency, and would designate the first week of May as In-Demand Jobs Week.   Many of those provisions were adopted in the Biennial Budget Bill, so another substitute version has been introduced, which shifts the focus to an In-Demand Jobs Week in May and revises the training requirements for alternative resident educator licenses, allowing for-profit entities such as Teach for Tomorrow to provide training to prospective alternative educators.  That substitute bill was adopted by the Senate Transportation, Commerce and Workforce Committee September 13 to make the bill identical to companion bill HB 166. On October 11, the committee reported the bill after accepting an amendment from Rep. Rick Perales (R-Beavercreek) that he said eliminates Resident Educator Summative Assessment language to ensure it mirrors House Bill 166.

SB 43 BUILDING CODES (Bacon, K.)  This bill was introduced February 9 and would enable limited home rule townships to adopt building codes regardless of any similar codes adopted by the county in which the township resides.  In introducing the bill, sponsor Representative Bacon said his proposal would let residents and businesses in certain limited home rule townships obtain building permits at the township level, which would be more convenient than seeking permits from county departments.  The bill was referred to the Local Government, Public Safety & Veterans Affairs Committee, where several hearings have occurred.

SB 51   LAKE ERIE (Skindell, M., Eklund, J.)   This bill, introduced February 14, would authorize the creation of a special improvement district to facilitate Lake Erie shoreline improvement. The definition of “public improvement” would be expanded to include shoreline improvement projects, and funds from special assessments on property within the district could be used to pay for such improvement projects.  It has been referred to the Senate Energy and Natural Resources Committee where a third hearing occurred September 20 and two amendments were offered. The first, from ODNR was intended to ensure any property held in trust by the state is not taxed due to the creation of the district, and the second was to ensure that property owners impacted by the district are 100% on board with forming the district. It also modifies the bill to address instances when dealing with parcels controlled by homeowner or condominium associations.

SB 97   ECONOMIC DEVELOPMENT  (LaRose, F., Yuko, K.)  This is a companion bill to HB 122 and would establish a Regional Economic Development Alliance Study Committee to study the benefits and challenges involved in creating regional economic development alliances.  It has been referred to the Senate Government Oversight & Reform Committee.  A first hearing with sponsor’s testimony occurred June 21.  Senator Frank LaRose (R-Hudson) said the idea behind the bill is that “our economic futures are tied together.”  The bill was referred to the Senate Government Oversight & Reform Committee on September 27, 2017. It has not yet had a hearing in this committee. Meetings have occurred with Senate Sponsor Frank LaRose regarding the possible addition of an OEDA representative as an ex officio member of the Study Committee.

SB 113 FUEL TAX (Coley, W)  Introduced in March and referred to the Senate Ways and Means Committee, this bill would levy an additional registration tax on passenger cars, noncommercial motor vehicles, and commercial cars and trucks beginning on January 1, 2020; to authorize a per-gallon motor fuel retail price reduction for consumers that is equal to the state per-gallon motor fuel tax of $.28; and to exempt each gallon of motor fuel that is sold at the reduced retail price from the state motor fuel tax.  A second hearing in committee occurred September 20 with no testimony.

SB 114 COMMERCIAL VEHICLE TAX CREDIT (Hite, C.)  Introduced in March, this bill was referred to the Ways and Means Committee where a first hearing occurred May 3.   Bill sponsor Senator Hite said the state has between 7,000-8,000 transportation jobs unfilled due to challenges finding qualified drivers. His bill would create a business tax credit to cover some costs for training workers to fill those positions.

SB 123 PROPERTY TAX COMPLAINTS (Coley, B.) Introduced in April, this bill would limit the right to initiate most types of property tax complaints to the property owner and the county recorder of the county in which the property is located.  It was referred to the Ways and Means Committee, where Senator Coley advised during sponsor’s testimony May 3 that the proposal is identical to his prior bill (SB85, 131st General Assembly) in that it would allow property tax complaints to be initiated only by property owners or county recorders.  The county is currently charged with establishing property value, after which, the sponsor argued, other government entities “get a bite of the valuation apple” and seek to dispute the value through the complaint process. “This has resulted in property owners having to consent to the higher valuation set forth in the complaint or spend funds defending the complaint, even if the property owner had no major objection to the original valuation,” Sen. Coley said. He accused school boards and other government entities of filing claims only to drive up property values. According to the sponsor, filings show that challenges resulting in lower valuations typically originate from property owners rather than those government entities.  He said the bill would also help alleviate a current backlog of cases facing the Board of Tax Appeals.

SB 128 NUCLEAR ENERGY (Eklund, J., LaRose, F.)   This bill was introduced April 6 and would establish the Zero Emission Nuclear Resource Program, which would create the zero-emissions credits, or ZECs, to be priced by the Public Utilities Commission of Ohio and purchased by distribution utilities with nuclear plants. Utilities would recover that cost through rate increases on consumers in areas with nuclear plants with the increase capped at 5% of June 2015 rates. The program would sunset in 16 years and run in two year cycles. Under the bill, should those two plants be sold or transferred the value of ZECs received is to be reduced by an amount equal to one-half the dollar amount of any net proceeds of the sale. That provision would not be in effect in the event of bankruptcy, according to the bill. The measure would require any company subject to the bill’s provisions with a headquarters in Ohio to maintain that headquarters and require plants receiving credits to maintain employment levels similar to that of nuclear energy resources constructed prior to 1990 in the United States with the same reactor type, similar nameplate capacity, and single-unit location.  The bill was referred to the Public Utilities Committee, where several hearings have occurred.  Chairman Bill Beagle (R-Tipp City) said Senate hearings will continue until all witnesses have had the chance to share their thoughts. “We’re going to continue down the path until everyone’s been heard and probably convene and have a conversation (among members) at that point,” he said.  Senate President Larry Obhof (R-Medina) said that leadership will “respect the committee process.”  Hearings occurred as recently as June 1 and June 8.  This is a companion bill to HB 178, and sponsors in both chambers are continuing conversations with interested parties in order to earn support for these bills.

SB 131 TAX CREDITS (Dolan, M.)  This is a companion bill to HB 173 and would provide that compensation paid to certain home-based employees may be counted for purposes of an employer qualifying for and complying with the terms of a Job Creation Tax Credit.  The bill passed in the Senate May 24 and was introduced in the House May 25, where a hearing occurred June 6.

SB 132 TAX CREDIT  (Dolan, M.)  This bill would establish a five-year pilot program whereby taxpayers with facilities in this state with activated foreign trade zone status may claim a nonrefundable commercial activity tax credit equal to the amount redeployed by the taxpayer to job creation and renewable energy resources.  It was referred to the Ways and Means Committee, where a hearing occurred June 7.

SB 147 RURAL JOBS (Hite, C.) This bill would enact the “Ohio Rural Jobs Act” which would authorize a nonrefundable tax credit for insurance companies that invest in rural business growth funds, which are certified to provide capital to rural and agricultural businesses.   A similar provision inserted into the state budget bill was vetoed by Governor Kasich.  SB 147 was referred to the Ways and Means Committee, where a first hearing with sponsor’s testimony occurred September 6.  A second hearing with proponents’ testimony occurred September 27.

SB 176 MUNICIPAL TAXES (Jordan, K.) Introduced August 7, 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.  It was referred to the Ways and Means Committee.

SB 184 WIND SETBACKS  (Skindell, M.)  Introduced August 31, this bill would return the minimum setback requirement for wind farms of five or more megawatts to the pre-HB 483 (130th General Assembly) requirements.  It was referred to the Energy & Natural Resources Committee, where a first hearing occurred September 27.   Bill sponsor Senator Mike Skindell said, “With the restrictive setback requirements, the American Wind Energy Association reported that Ohio is missing out on an estimated $4.2 billion in economic development.  In fact, approximately 13,000 jobs, $660 million in tax payments to local governments and schools and lease payments to landowners totaling more than $440 million over the next 30 years have been stifled.”  The bill would revert the setbacks to 1,125 feet from the blade tip to the property line – the same level they were before a 2014 Senate floor amendment that resulted in the current setbacks.

SB 188 WIND TURBINE SETBACKS (Hite, C.)  Introduced September 14 and labeled as a compromise measure, the bill would increase the setback requirements to a minimum of one and two-tenths times the total height of the turbine compared to the currently required one and one-tenth, but it would decrease overall setbacks by requiring a distance of at least 1,225 feet in horizontal distance from the exterior – rather than the property line as under current law – of the nearest, habitable residential structure. It would also strengthen notice requirements by requiring the Ohio Power Siting Board to create rules requiring public information meetings and public notice involving owners and tenants on property adjacent to a potential wind farm.  The bill would also modify the setback waiver in order to permit an owner of a parcel abutting a parcel adjacent to a wind farm to waive the setback requirement. The current law, in contrast, requires all owners of adjacent property to waive the setback. It was referred to the Energy & Natural Resources Committee where a first hearing occurred September 27.

SB 203 MUNICIPAL TAXATION (Dolan, M.) Introduced September 28, this bill would reinstate the municipal income tax “throw-back rule” used in apportioning business income among municipalities.  The rule was only recently eliminated in HB 49 (the Budget Bill)

SB 209 TAX EXEMPTIONS (Coley, B.)  Introduced October 3, this bill would modify the conditions that determine the relative priority of property tax exemptions when a parcel subject to a tax increment financing arrangement concurrently qualifies for another exemption.