Legislation . . . In the News

By Anthony Core

October 1, 2018

Squire Patton Boggs (US) LLP
614-365-2796

OCCD Legislative Committee

The following is a summary of recent Ohio General Assembly activity relating to economic development matters through September 1, 2018. 

LEGISLATION RECENTLY ENACTED 

House Bill 49 (Passed June 28, 2017; signed by the Governor June 30, 2017, with some items vetoed; appropriations effective immediately, all other provisions effective September 30, 2017.)  This is the State’s Operating Budget for fiscal years 2018-2019.  The State Budget Bill included the following provisions:

  • Creates a new TIF program in Revised Code Section 5709.48 under which one or more counties in a regional transportation improvement project may create a transportation financing district. Each overlying subdivision must approve the TIF and may enter into a compensation agreement.
  • Permits cities to pledge income taxes and counties to pledge sales taxes to a regional transportation improvement project under the terms of a cooperative agreement.
  • Eliminates the sunset date for the Enterprise Zone tax abatement program.
  • Lengthens the time period to submit a CRA Petition to the State from 15 days to 60 days after adoption of a resolution establishing a CRA tax abatement program.
  • Creates a new state Linked Deposit Program for eligible small businesses.
  • Provides that home-based employees may be counted towards compliance with the State’s Job Creation Tax Credit program.
  • Amends a provision in the township TIF program that permitted extension of exemptions for an additional 15 years for TIF resolutions adopted before December 31, 1994 to permit that extension only if approved by the school district.
  • Changes the competitive bidding threshold for port authorities to apply to contracts exceeding $150,000. 

House Bill 69 (Passed December 13, 2017; signed by the Governor December 22, 2017; effective March 22, 2018.)  This Bill amends the municipal incentive district TIF program under Revised Code Section 5709.40 to require reimbursement of certain township fire and emergency medical service levy revenue.  The Bill also increased transition payments to counties and transit authorities as a result of the Medicaid sales tax loss.     

House Bill 122 (Passed April 11, 2018; signed by the Governor May 2, 2018; effective August 1, 2018.)  This Bill creates a study commission to study regional economic development alliances. 

House Bill 123 (Passed July 24, 2018; signed by the Governor July 30, 2018; effective October 29, 2018.)  Known as the “payday lending bill”, this Bill modifies the Short Term Loan Act, to specify a minimum duration requirement for loans made under the Small Loan Law and Mortgage Loan Law, and to limit the authority of credit services organizations to broker extensions of credit for buyers. 

House Bill 463 (From prior General Assembly; signed by the Governor January 4, 2017; effective April 6, 2017.)  This Bill changes the State foreclosure process, including requiring an oral hearing before proceeding in an expedited manner and modifying minimum bid and appraisal requirements.  This Bill also prohibits the use of plywood to secure real property that is deemed vacant and abandoned. 

This Bill changes the Community Reinvestment Area program to increase the length of an exemption for the remodeling of all structures to 15 years. 

This Bill also incorporates some of the provisions of Senate Bill 134 relating to Civil Rights Laws, including allowing a person to recover attorney’s fees if the Civil Rights Commission finds the person did not engage in an unlawful discriminatory practice and authorizing the Commission to assess a civil penalty in lieu of punitive damages. 

House Bill 529 (Passed March 21, 2018; signed by the Governor March 30, 2018; portions effective June 29, 2018, most effective July 1, 2018; see also Senate Bill 266.)  This Bill is the State’s Capital Appropriation Budget for fiscal years 2019-2020. 

Senate Bill 8 (Passed November 29, 2017; signed by the Governor December 22, 2017; effective March 22, 2018.)  This Bill was originally introduced to create a funding program for school technology infrastructure upgrades, but as passed became a state budget revision bill.  Among many other provisions, the Bill modifies the law governing transportation financing districts, a tax increment financing-like method of funding Regional Transportation Improvement Projects (RTIPs), by placing the authority to use the method directly with the RTIP board, thus permitting the method to be used without approval by other taxing units if they will be fully compensated for the resulting property tax diversion, requiring leftover funds from the financing district to be distributed among such taxing units; and changing how other leftover RTIP funds are to be distributed upon the dissolution of the RTIP.  The Bill also authorizes a nonrefundable tax credit for insurance companies that make loans to or investments in “rural business growth funds” certified by the Development Services Agency, which invest in or lend to certain types of businesses operating in counties with populations less than 200,000.  The Bill also makes some specific revisions regarding a Stark County “tourism development district”. 

Senate Bill 235 (From prior General Assembly; Governor signed with line item vetoes on December 27, 2016; effective March 28, 2017.)  This Bill authorizes a six year property tax exemption for the increase in value of commercial or industrial property prior to development or redevelopment on the site.  The exemption terminates early if the property becomes occupied, if the property is sold or if the property is rezoned to not permit commercial or industrial uses.  The substitute Bill limits the exemption to those authorized by a city, county or township, with notice to the impacted school district and JVSD.  It provides for recoupment of three years of exempted tax savings under certain circumstances, including upon sale of the property while exempted. 

This Bill permits a downtown redevelopment district to include projects that were previously part of a tax increment financing district as long as it is no longer exempted.  This Bill also discontinues the catalytic project historic rehabilitation tax credit after fiscal year 2017 and permits an award to all qualified persons previously applying for the tax credit (waiving the one-project per biennium limitation). 

Senate Bill 239 (Passed June 27, 2018; signed by the Governor July 30, 2018; effective October 29, 2018.)  This Bill makes changes to the law regarding regional councils of governments. 

Senate Bill 299 (Passed June 27, 2018; signed by the Governor July 11, 2018; appropriations effective immediately, all other provisions effective October 10, 2018; see also Senate Joint Resolution 6, House Bill 643, and House Joint Resolution 16.)  This Bill as introduced would allow equipment for the protection and preservation of Lake Erie to be purchased with proceeds from the Park and Recreation Improvement Fund and appropriate funds for projects enhancing water quality in the Western Lake Erie Basin.  As enacted, it credits additional amounts of the Local Government Fund to fund public safety services in areas that experienced a 30% or more decrease in the taxable value of certain power plants between 2016 and 2017, and phases out the payments over ten years, increases the appropriation to the Local Government Fund; supports broadband development; establishes the OhioCorps Pilot Project; and makes appropriations, including appropriations for the protection and preservation of Lake Erie and the National Guard Scholarship Program. 

LEGISLATION PASSED BY THE HOUSE 

House Bill 281 (Introduced June 20, 2017; passed by House January 31, 2018; first hearing in Senate Finance Committee on June 19, 2018; see also House Bill 378.)  This Bill would establish a residential broadband expansion program to award matching grants for last mile broadband expansion in municipal corporations and townships.  A substitute version accepted in the House Committee expands the bill’s application to any internet service (i.e., wireless or satellite), not just broadband. 

House Bill 342 (Introduced September 11, 2017; passed by House June 20, 2018; not yet referred to Senate committee.)  This Bill would require that property tax election notices and ballot language indicate a property tax levy’s rate in dollars for each $100,000 of taxable value instead of for each $100 of taxable value (original provision I the Bill that would have disallowed local tax issues from being submitted to voters at August special elections was removed by Committee). 

House Bill 378 (Introduced October 10, 2017; passed by House April 11, 2018; referred to Senate Finance Committee on May 9, 2018; see also House Bill 281.)  This Bill would create the Ohio Broadband Development Grant Program. 

House Bill 415 (Introduced November 14, 2017; passed by House February 28, 2018; referred to Senate Finance Committee on March 21, 2018.)  This Bill would allocate one-half of state surplus revenues to a new Local Government Road Improvement Fund. 

House Bill 469 (Introduced January 17, 2018; passed House June 27, 2018; not yet referred to Senate committee.)  This Bill would authorize a nonrefundable insurance company tax credit for contributions of capital to transformational mixed use development projects (“TMUDs”). 

House Bill 500 (Introduced February 13, 2018; passed House June 27, 2018; not yet referred to Senate committee.)  This Bill would make numerous changes to township and county law, including: with regard to a petition to change the name of a township road submitted to a board of county commissioners, specify that the name of the road automatically changes if the board does not adopt a resolution regarding the petition within 60 days after receiving it; prohibit a board of county commissioners from adopting a resolution to vacate a public road that is a township road unless the applicable board of township trustees has adopted a resolution approving the vacation; eliminate the limitation on the types of platted subdivisions concerning which a county or township may adopt a zoning resolution to regulate agriculture; authorize a board of township trustees to impose, upon a person who appeals a zoning decision to the board of zoning appeals, a fee to defray the cost of advertising, mailing, and other expenses; for limited home rule townships only, make permissive the current law requirement that a township submit a proposed zoning amendment or resolution to a planning commission for approval, disapproval, or suggestions; allow a township to require reimbursement of township police, fire, emergency medical, and ambulance levy revenue foregone because of creation of a township TIF incentive district; authorize certain townships to use TIF payment-in-lieu-of-tax revenue to pay the expenses of maintaining any infrastructure project that was financed with such revenue; and eliminate the requirement that the total acreage in certain new community districts be not less than 1,000 acres. 

House Bill 543 (Introduced March 7, 2018; passed House June 27, 2018; not yet referred to Senate committee.)  This Bill would allow a county prosecuting attorney to enter into a contract with a regional airport authority, port authority, or regional planning commission to be its legal adviser. 

LEGISLATION INTRODUCED IN THE HOUSE 

House Bill 162 (Introduced March 28, 2017; first hearing in House Ways and Means Committee on May 9, 2017.)  This Bill would authorize a refundable income tax credit for investors in a sound recording production company for a portion of production related costs or capital costs up to $75,000.  Applications would be made to the Development Services Agency and awarded on a first-come, first-served basis up to $1 million per fiscal year. 

House Bill 163 (Introduced March 28, 2017; second hearing in House Economic Development, Commerce and Labor Committee on September 19, 2017; see also Senate Bill 72.)  This Bill would make the applicability of prevailing wage laws optional for political subdivisions and state institutions of higher education. 

House Bill 371 (Introduced October 4, 2017; reported out of House Ways and Means Committee on January 16, 2018; re-referred to House Rules and Reference Committee on March 1, 2018.)  This Bill would exempt from property taxes the increase value of land that has been subdivided for residential development until construction on that land commences or the land is sold. 

House Bill 413 (Introduced November 9, 2017; third hearing in House Aging and Long Term Care Committee on February 6, 2018.)  This Bill would change, beginning January 1, 2019, the annual cost-of-living adjustment granted to most in the PERS retirement allowance, disability benefit, and survivor benefit recipients from 3% under current law to the percentage increase in the Consumer Price Index, not exceeding 2.5%. 

House Bill 488 (Introduced January 30, 2018; second hearing in House Ways and Means Committee on March 20, 2018.)  This Bill would require property tax levy election notices and ballot language to provide: (i) the levy’s rate in dollars for each $100,000 of fair market value instead of in dollars for each $100 of taxable value, and (ii) if the levy is a replacement or renewal levy, the effect, if any, of the tax reduction factor on collections for the proposed replacement or renewal levy in relation to the existing levy. 

House Bill 530 (Introduced February 27, 2018; fourth hearing in House State and Local Government Committee on May 16, 2018; see also Senate Bill 252.)  This Bill would authorize local elected officers that have levied a hotel lodging excise tax, or designees of such officers, to simultaneously hold the position of officer or member of the board of trustees of a convention and visitors’ bureau without constituting incompatible offices. 

House Bill 602 (Introduced April 17, 2018; third hearing in House Finance Committee on June 26, 2018.)  This Bill would penalize a municipal corporation for engaging in certain actions related to its provision of water and sewer services outside of its territory by reducing or withholding payments the municipal corporation receives from the Local Government Fund and rendering the municipal corporation ineligible for state water and sewer development funds. 

House Bill 643 (Introduced May 9, 2018; substitute bill reported out of House Finance Committee on June 19, 2018; see also House Joint Resolution 16, Senate Bill 299, and Senate Joint Resolution 6.)  This Bill would allow equipment for the protection and preservation of Lake Erie to be purchased with proceeds from the Park and Recreation Improvement Fund and appropriate funds for projects enhancing water quality in the Western Lake Erie Basin. 

House Bill 668 (Introduced May 22, 2018; referred to House Higher Education and Workforce Development Committee on June 19, 2018.)  This Bill would authorize state agencies, state institutions of higher education, counties, townships, municipal corporations, school districts, community schools, STEM schools, and college preparatory boarding schools to enter into public-private initiatives with a private party through a public-private agreement regarding public facilities. 

House Bill 669 (Introduced May 22, 2018; referred to House Community and Family Advancement Committee on June 5, 2018.)  This Bill would add the accumulation of garbage and debris to the conditions that may constitute a public nuisance. 

House Bill 673 (Introduced May 22, 2018; referred to House Health Committee on June 5, 2018.)  This Bill would require the Director of Health to develop a program in partnership with paint manufacturers and retailers to provide low-cost paint for use in lead abatement and establish a registry of residential units where lead poisoning has occurred. 

House Bill 695 (Introduced May 22, 2018; second hearing in House Finance Committee on June 26, 2018.)  This Bill would reinstate the rural industrial park loan fund. 

House Bill 715 (Introduced July 24, 2018; not yet referred to House committee.)  This Bill would authorize a municipal corporation to use up to 5% of its water and sewer funds for sewerage or water system extensions in each fiscal year when the extension is for economic development purposes. 

House Joint Resolutions 7-12 (Introduced December 21, 2017; referred to House Government Accountability and Oversight Committee on January 16, 2018.)  These Resolutions each propose a Constitutional amendment to be placed before the voters that would implement anti-union measures. 

House Joint Resolution 14 (Introduced March 28, 2018; referred to House State and Local Government Committee on April 10, 2018.)  This Resolution would propose a Constitutional amendment to be placed before the voters that would permit the issuance of general obligation bonds of the State to fund local government sewer and water capital improvements. 

House Joint Resolution 16 (Introduced May 9, 2018; referred to House Finance Committee on May 15, 2018; see also House Bill 643, Senate Bill 299, and Senate Joint Resolution 6.)  This Resolution would propose a Constitutional amendment to be placed before the voters that would permit the issuance of general obligation bonds of the State to fund Lake Erie watershed clean water improvements. 

LEGISLATION PASSED BY THE SENATE 

Senate Bill 252 (Introduced January 30, 2018; passed by Senate May 23, 2018; referred to House Government Accountability and Oversight Committee on June 5, 2018; see also House Bill 530.)  This Bill would authorize local elected officers that have levied a hotel lodging excise tax, or a designee of such officers, to simultaneously hold the position of officer or member of the board of trustees of a convention and visitors’ bureau without constituting incompatible offices. 

LEGISLATION INTRODUCED IN THE SENATE 

Senate Bill 72 (Introduced February 27, 2017; referred to Senate Finance Committee on March 7, 2017; see also House Bill 163.)  This Bill would make the applicability of prevailing wage laws optional for political subdivisions and state institutions of higher education. 

Senate Bill 123 (Introduced April 5, 2017; second hearing in Senate Ways and Means Committee on June 14, 2017.)  This Bill would limit the right to initiate a complaint on the assessed value of property to the property owner and the county recorder.  School districts and other entities may only file counterclaims to complaints filed. 

Senate Bill 209 (Introduced October 3, 2017; referred to Senate Ways and Means Committee on October 25, 2017.)  This Bill would modify Ohio Revised Code Section 5709.911, which outlines the relative priority of tax exemptions. 

Senate Bill 213 (Introduced October 5, 2017; first hearing in Senate Finance Committee on June 19, 2018.)  This Bill contains a variety of economic development related programs, including additional assistance for workforce development, a revolving loan fund and job tax credit program for small businesses and funding for local infrastructure and public transit. 

Senate Bill 266 (Introduced February 26, 2018; second hearing in Senate Finance Committee on March 1, 2018; see also House Bill 529.)  This Bill is the State’s Capital Appropriation Budget for fiscal years 2019-2020. 

Senate Joint Resolution 6 (Introduced May 9, 2018; referred to Senate Finance Committee on May 10, 2018; see also Senate Bill 299, Senate Joint Resolution 6, and House Bill 643.)  This Resolution would propose a Constitutional amendment to be placed before the voters that would permit the issuance of general obligation bonds of the State to fund Lake Erie watershed clean water improvements.

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