Member Alert:
Additional Issues Included in Proposed State Operating Budget Bill Impacting Ohio’s Municipalities
June 16, 2021
While the League has altered our members of what we consider the most impactful municipal issues currently included in Sub. HB 110, the state operating budget bill, we also want to make our members aware of several other issues in the budget that are important and would have an impact on municipalities. Here are the additional issues with municipal impacts included in the budget bill thus far:
·        Attorneys’ fees and costs in inverse condemnation proceedings: Requires courts in inverse condemnation (a variation of the eminent domain concept where the suit is initiated by the property owner) proceedings to award amounts sufficient to reimburse a property owner for reasonable expenses in the proceeding if the property owner is successful in the proceeding, or reaches a settlement. This would potentially increase the costs to applicable state agencies or local governments related to eminent domain actions. While this provision was removed by the Senate before the bill went to Conference Committee, provisions in previous versions of Sub. HB 110 are still part of ongoing budget negotiations, adding the threat that the issue will be part of the final legislation. The League is opposed to this language.
·        Liens for unpaid municipal garbage collection: Allows a municipal corporation to place as a lien on property the amount of unpaid garbage/trash collection charges, when the unpaid amount is greater than the annual charge for the services, in addition to the ability to do so when the unpaid amount is at least $250 as under current law. The amendment also specifies the limitations above do not apply to a municipal corporation that collects all garbage/trash charges (not only unpaid amounts) via the tax list.
·        Court of Claims procedure for Open Meetings Law violations: Creates a procedure within the Court of Claims to hear complaints alleging a violation of the Open Meetings Law, which would Increase in Court of Claims’ operating expenses of approximately $705,000 annually, with an additional $34,000 in one-time costs. There may be potential savings for courts of common pleas and minimal annual gain in filing fee revenues for state and counties. You can find a full summary of the provision HERE.
·        TIF and downtown development district changes: Modifies the law governing tax increment financing districts (TIF) and downtown redevelopment districts (DRD) to allow subdivisions to use TIF or DRD service payments for off-street parking facilities. The amendment also allows municipalities that create certain types of TIFs the discretion to designate the beginning date of the TIF exemption, rather than the exemption automatically beginning on the effective date of the designating ordinance. (This latter discretion is already allowed to subdivisions creating other types of TIFs and DRDs.)
·        Joint economic development district (JEDD) notice, petition, and contract requirements: Modifies the notice and opt-out procedures for certain property that is located within half a mile of the JEDD or receives water or sewer services under certain agreements from a municipality that is not part of the JEDD. It also requires that the JEDD contract include certain information relating to the district's public utility infrastructure, if the proposed JEDD would include any property in which any non-JEDD party would provide water or sewer services.
·        Rural business growth program: Makes changes to the existing insurance premiums tax credit for investments in rural business growth funds, including an increase in the amount of tax credits by $45 million that may be awarded by the Department of Development and modifying the eligibility criteria and investment criteria for the new credit allocation. The tax credits created in this amendment and associated revenue losses to the General Revenue Fund (GRF), the Local Government Fund (LGF), and the Public Library Fund would first occur in fiscal year 2024.You can find a full summary of the provision HERE.
·        State and local government expenditure database: Requires the Treasurer of State to establish and maintain the Ohio State and Local Government Expenditure Database, which is to include detailed data on expenditures of state government and those of volunteering political subdivisions and state retirement systems. The database would be made freely available to the public. Most of the provisions in the amendment codify existing practice of operating Ohio Checkbook website. You can find a full summary of the provision HERE.
·        Tourism development districts: Clarifies that a municipality or township may enlarge the territory of an existing Tourism Development District (TDD) after December 31, 2020, the deadline under continuing law for creating a new TDD. This allows for municipal corporations to assess fees on property owners within a TDD if the TDD is being enlarged.
·        Municipal fiscal officer continuing education: Requires an appointed municipal fiscal officer to complete 18 hours of continuing education during the first term of office and 12 hours in each subsequent term, thereby matching the requirements for elected municipal fiscal officers.
·        Serving containers permitted for use in DORAs: Requires qualified liquor permit holders in designated outdoor refreshment areas (DORAs) to serve beer or intoxicating liquor in plastic bottles or other “non-glass” containers, rather than only in plastic bottles or other plastic containers.
As we have shared with our members, a Conference Committee has been formed to work out the differences between the budget language proposed by the Ohio House, Ohio Senate and the DeWine Administration. Although the committee is to address the current differences between the competing versions of the legislation, there is always the possibility that new items may be added to the bill which were not part of the previous budget discussions. The legislature has until June 30 to complete the budget process in order to ensure the Governor can sign the budget into law by July 1.   

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