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 April 5, 2019

OML UPDATE AT-A-GLANCE  
Here are the top three things you need to know from this past week:
  • The Governor's Executive Budget proposal for FY 20-FY 21 projects that the economic expansion that started in 2009 will extend at least through the end of FY 19. If it were to last through July 2019, it will match the longest economic expansion on record, which lasted 120 months in the 1990s. 
  • The state has issued 11 businesses tax credits for expansion. The tax credits are projected to create 1,715 new jobs, retain 1,448 current jobs, generate $94 million in new payroll and attract $463 million in additional investments.
  • Governor DeWine and Director of Public Safety Tom Stickrath have announced that 445 law enforcement agencies have voluntarily adopted statewide minimum standards on the use of force, deadly force hiring and recruitment. Another 49 agencies are currently in the process of adopting the same standards.
 
TRANSPORTATION BUDGET SIGNED BY GOVERNOR WITH GAS TAX INCREASE
This Wednesday, Gov. DeWine signed Sub. HB 62, the $8.5 billion Transportation Budget, into law. The bill had been finalized and passed by a conference committee on Tuesday. The bill then proceeded to the House, where it was passed by a vote of 70-27. Afterwards it was concurred upon by the Senate by a vote of 22-10 and sent to the Governor's desk for his signature.
The Ohio Department of Taxation has created a spreadsheet with the distribution amounts to each municipality under the new gas tax increase over the biennium. You can access that spreadsheet HERE.
Sub. HB 62 increases the motor fuel tax to 10.5 cents and increases the diesel fuel tax to 19 cents. This new amount is estimated to generate an increase of $865 million in motor fuel tax revenue annually. The increase will go into effect on July 1 and will be divided between the state and local governments in a new 55%-45% split respectively, as opposed to the current 60%-40% spilt. Of the $865 million and with the split percentages, the state will receive $524 million while local governments will receive $381 million.
Here are the other provisions in the final version of Sub. HB 62 impacting municipalities:
  • $5 permissive licensing fee for municipalities and townships
  • Funding public transit at $70 million for funding public transit
  • $200 and $100 fees for electric and hybrid vehicles respectively.
  • Creates the Ohio's Roads to Our Future Study Committee.
  • Retains local control of e-scooters
  • Changes administrative practices and allows the state to reduce LGF revenue distribution amounts for use of Red Light Cameras
  • Removes $5 million relief funding from Oil and Gas Fund to communities impacted by fracking
 
The final version of the bill unfortunately still contained the language penalizing municipalities operating red light cameras by altering the administrative hearing process and reducing LGF distributions equal to the revenue collected through violations enforced via this constitutionally sanctioned technology. League Director Scarrett sent a letter to Governor DeWine requesting a line-item veto of this provision on the grounds that the language challenges the authorities delegated to municipalities through the Ohio Constitution's Home Rule provisions and unduly punishes municipalities from employing smart technology to better protect the public. You can read that letter HERE.
We believe this significant change in state policy should not have been re-inserted into the budget bill, especially considering the Supreme Court very recently upheld that the municipal operation of traffic cameras was protected by the right to Home Rule under the Ohio Constitution. Instead, the issue should have been introduced as separate legislation so that the issue could be vetted and impacted municipalities could be given an opportunity to educate members of the General Assembly on what this punitive language would mean to their communities. Ultimately, there were no vetoes granted.
The League greatly appreciate the leadership of Governor DeWine and the members of the Ohio General Assembly to address the critical issues facing Ohio's local and state transportation infrastructure with the securing of new funding. The new revenues from the increased motor fuel tax will help Ohio municipalities rebuild our crumbling infrastructure and will provide greater economic development opportunities statewide.
We encourage our members reach out to Governor DeWine and their legislative delegations with their thanks for the investment made in the future of our communities via Sub. HB 62.         
   
STATE OPERATING BUDGET BILL HEARD IN HOUSE FINANCE SUBCOMMITTEES  
This week, the State Operating Budget, HB 166, had a series of hearings in various House Finance subcommittees. These hearings granted the opportunity for various departments and agencies to present on the provisions in the budget bill that affect them.
The Ohio Department of Taxation (ODT) testified before the House Finance Transportation Subcommittee on their budget request for the biennium. Municipalities should note two of the priorities Tax Commissioner McClain outlined in his testimony. The first item of note is the ODT's priority to enhance the secure portal connecting ODT with local governments that facilitates the electronic transfer of the municipal net profits tax data to and from municipalities.
ODT wants to create a means within the portal to collect historical data from municipalities regarding the net profits tax, as well as including other local government data exchanges that are as yet unspecified. ODT also wants to update the system used to administer the Municipal Income Tax for Electric Light Companies and Local Exchange Telephone Companies (MELT). You can read Tax Commissioner McClain's testimony HERE .
Department of Administrative Services (DAS) Director Matt Damschroder testified in support of the executive budget recommendations for funding DAS. In his testimony he noted DAS's involvement with InnovateOhio, which in part works with local governments to attract businesses to invest in Ohio, Opportunity Zones and the Ohio Business Gateway, which administers the centralized collection of the municipal net profits income tax. You can read Dir. Damschroder's full testimony HERE .
The Executive Director of the Ohio Board of Tax Appeals, Kathleen Crowley, testified in support of their executive budget request, citing the role of the Board to resolve cases from the Ohio Tax Commissioner, all 88 counties and all municipalities with an income tax. You can read her full testimony HERE . Director Jack Marchbanks of the Ohio Department of Transportation testified in support of the executive budget request to fund other modes of transport besides roads and bridges, including public transit. You can read his testimony HERE . The League will continue to update our members on relevant aspects of the budget as it moves through the legislative process.  
 
SENATE PASSES LEGISLATION IMPACTING MUNICIPALITIES
 
Here are the bills passed by the Senate this week that are of municipal interest:
 
  • SB 52 - CYBER SECURITY. Sponsored by Sen. Gavarone (R - Bowling Green), would create the civilian cyber security reserve forces, make the Secretary of State a member of the Homeland Security Advisory Council, require the Secretary of State to appoint a chief information security officer, require the boards of elections to audit election results, and make an appropriation. During its fourth hearing before the Senate Government Oversight and Reform Committee, the bill was voted unanimously out of committee. The bill was passed on the Senate floor unanimously. The League is supportive of this legislation.
 
  • SB 8 - OPPORTUNITY ZONES. Sponsored by Sen. Schuring (R - Canton), would authorize tax credits for investments in an Ohio Opportunity Zone. During its fifth hearing before the Senate Ways and Means Committee, the bill was first amended to further apply its provisions if the federal government expands the program as well as adjusting the review processing period to 60 days before it was voted unanimously out of committee. The bill was then passed on the Senate floor unanimously. The League is supportive of this legislation.
   
INTRODUCED: BILLS OF MUNICIPAL INTEREST
 
Here is a bill introduced this week that impacts municipalities:
 
  • HB 187 - TAX ISSUES - AUGUST. Sponsored by Rep. Merrin (R - Monclova Township) and Rep. Wiggam (R - Wooster), would prohibit local tax-related proposals from appearing on an august special election ballot.
   
COMMITTEE RECAP: BILLS OF MUNICIPAL INTEREST
 
Here are the bills impacting municipalities that received committee hearings this week:
 
  • SB 39 - INSURANCE TAX. Sponsored by Sen. Schuring (R - Canton), would authorize an insurance premiums tax credit for capital contributions to transformational mixed use development projects. During its second hearing before the Senate Finance Committee, proponents from investment and development companies testified in support of the bill. The League also submitted written proponent testimony, which you can read HERE.
 
  • SB 50 - SOLID WASTE FEES. Sponsored by Sen. Eklund (R - Chardon), would increase state solid waste disposal fee that is deposited into the Soil and Water Conservation District Assistance Fund, and to make an appropriation. During its second hearing before the Senate Finance Committee, a representative from the Geauga County Soil and Water Conservation District testified in support of the bill. The League is still looking into this legislation.
 
  • HB 159 - PUBLIC IMPROVEMENTS - INDEMNITY PROVISIONS. Sponsored by Rep. Blessing (R - Cincinnati), would regulate the use of indemnity provisions in professional design contracts related to public improvements. During its first hearing before the House Civil Justice Committee, the bill's sponsor explained that it is designed to prevent design professionals from being "forced" to sign contracts with some state and local agencies that make them liable beyond what the law outlines. The League is still looking into this legislation.
 
  • HB 126 - SINGLE SUBJECT RULE TIMELINE. Sponsored by Rep. Hillyer (R - Urichsville), would bar an action challenging an act for violation of the one-subject rule if it is commenced later than 275 days after the act's effective date. During its second hearing before the House Civil Justice Committee, no proponent testimony was give on this bill. The League is opposed to this legislation.
 
  • HB 75 - PROPERTY VALUES. Sponsored by Rep. Merrin (R - Monclova Township), would require local governments that contest property values to formally pass an authorizing resolution for each contest and to notify property owners. During its third hearing before the House Ways and Means Committee, over a dozen representatives from Ohio school districts testified in opposition to the bill. The County Commissioners Association of Ohio submitted written opponent testimony, as did the League. You can read the League's opponent testimony HERE.
 
  • HB 47 - PROPERTY TAX COMPLAINTS. Sponsored by Rep. Greenspan (R - Westlake), would increase the time within which property tax complaints must be decided and to change the name of the Ohio Legal Assistance Foundation. During its third hearing before the House Ways and Means Committee, a representative from the County Auditor's Association of Ohio testified in support of the bill. The League also submitted written proponent testimony, which you can read HERE.
 
  • HB 76 - ELECTION NOTICES. Sponsored by Rep. Merrin (R - Monclova Township), would enact the "Ballot Uniformity and Transparency Act" to modify the form of election notices and ballot language for property tax levies. During its third hearing before the House Ways and Means Committee, the League submitted joint opponent testimony along with the Ohio Library Council, the Ohio Township Association, the Ohio School Board Association, the Ohio Association of School Board Officials and the Buckeye Association of School Administrators. You can read that opponent testimony HERE.
 
  • SB 31 - PUBLIC RECORDS. Sponsored by Sen. Roegner (R - Hudson), would include emergency service telecommunicators as individuals whose residential and familial information is exempt from disclosure under the Public Records Law. During its third hearing before the Senate Judiciary Committee, the bill was reported out of the committee. The League is supportive of this legislation.
 
  • SB 33 - CRITICAL INFRSTRUCTURE. Sponsored by Sen. Hoagland (R - Adena), would modify certain criminal offenses with respect to critical infrastructure facilities and to impose fines and civil liability for damage to a critical infrastructure facility. During its third hearing before the Senate Judiciary Committee, multiple opponents to the bill testified against it saying it attempted to suppress free speech. The League is supportive of this legislation.
 
  • HB 149 - PROPERTY TAX EXEMPTION. Sponsored by Rep Merrin (R - Monclova Township), enact the "Affordable Homebuilding and Housing Act" to temporarily exempt from property tax the increased value of land subdivided for residential development. During its first hearing before the House Economic and Workforce Development Committee, the bill's sponsor claimed it would incentivize homebuilding in Ohio. The League is opposed to this legislation

  • SB 105 - MASSAGE THERAPY. Sponsored by Sen. Brenner (R - Powell), would make changes to the massage therapy licensing law. During its first hearing before the Senate Health, Human Services and Medicaid Committee, the bill's sponsor said it was molded on multiple local ordinances that are designed to crack down on illegal activities at massage parlors by closing a loophole in current law allowing people to perform massages without a license. The League is supportive of this legislation


COMMITTEE SCHEDULE FOR THE WEEK OF APRIL 7, 2019
Tuesday, April 9, 2019
HOUSE WAYS AND MEANS
Tue., Apr. 9, 2019, 3:00 PM, Hearing Room 116
Rep. Schaffer: 614-466-8100
 
TAX CREDIT-VOLUNTEER SERVICE (KELLER C) To grant income tax credits to persons who serve as volunteer peace officers, firefighters, or emergency medical technicians. 
 
First Hearing, Sponsor Testimony
 
PROPERTY VALUE CONTESTS (MERRIN D) To require local governments that contest property values to formally pass an authorizing resolution for each contest and to notify property owners. 
 
Fourth Hearing, All Testimony, POSSIBLE VOTE
 
BALLOT LANGUAGE UNIFORMITY (MERRIN D) To enact the "Ballot Uniformity and Transparency Act" to modify the form of election notices and ballot language for property tax levies. 
 
Fourth Hearing, All Testimony, AMENDMENTS/POSSIBLE VOTE
 
 
HOUSE FINANCE AGRICULTURE, DEVELOPMENT AND NATURAL RESOURCES SUBCOMMITTEE
Tue., Apr. 9, 2019, 3:30 PM, Hearing Room 018
Rep. Hoops: 614-466-3760
Committee will take testimony related to EPA, ODNR, ODAg and Lake Erie Commission.
 
OPERATING BUDGET (OELSLAGER S) To make operating appropriations for the biennium beginning July 1, 2019, and ending June 30, 2021, and to provide authorization and conditions for the operation of state programs. 
 
Seventh Hearing, All Testimony
 
 
HOUSE FINANCIAL INSTITUTIONS
Tue., Apr. 9, 2019, 5:00 PM, Hearing Room 113
Rep. Jordan: 614-644-6711
 
PAY FOR SUCCESS CONTRACTING (MANNING D) To require the Treasurer of State to administer the Pay for Success Contracting Program and to expand the purposes of the Program. 
 
First Hearing, Sponsor Testimony
 
Wednesday, April 10, 2019
HOUSE FINANCE AGRICULTURE, DEVELOPMENT AND NATURAL RESOURCES SUBCOMMITTEE
Wed., Apr. 10, 2019, 10:00 AM, Hearing Room 017
Rep. Hoops: 614-466-3760
Agencies testifying: 
- Development Services Agency
- Housing Finance Agency
- Architects Board
- Commission on Service and Volunteerism
 
OPERATING BUDGET (OELSLAGER S) To make operating appropriations for the biennium beginning July 1, 2019, and ending June 30, 2021, and to provide authorization and conditions for the operation of state programs. 
 
Eighth Hearing, Invited Testimony
 
 
Thursday, April 11, 2019
HOUSE FINANCE AGRICULTURE, DEVELOPMENT AND NATURAL RESOURCES SUBCOMMITTEE
Thu., Apr. 11, 2019, 10:00 AM, Hearing Room 017
Rep. Hoops: 614-466-3760
Committee will take all testimony.
 
OPERATING BUDGET (OELSLAGER S) To make operating appropriations for the biennium beginning July 1, 2019, and ending June 30, 2021, and to provide authorization and conditions for the operation of state programs. 
 
Ninth Hearing, All Testimony
 
OHIO RETIREMENT STUDY COUNCIL
Fri., Apr. 12, 2019, 10:00 AM, TBA
Bethany Rhodes: 614-228-1346
Location to be announced. On the agenda: 2017 OP&F annual adequacy report: rules;
CHECK OUR WEBSITE MONDAY FOR ANY CHANGES TO THE COMMITTEE SCHEDULE

Ohio Municipal League Meetings & Trainings

OML/OMAA WEBINAR
Collective Bargaining
April 11, 2019

Ohio Municipal League

Legislative Inquires:
Kent Scarrett, Executive Director
Edward Albright, Deputy Director
Ashley Brewster, Director of Communications
Thomas Wetmore, Legislative Advocate

Website/Bulletin Issues:
Zoƫ Wade, Office Manager