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 March 29, 2019

OML UPDATE AT-A-GLANCE

Here are the top three things you need to know from this past week:
  • Perrysburg Councilman Haraz N. Ghanbari has been appointed to fill the Third House District, which was vacated earlier this year by Sen. Theresa Gavarone (R - Bowling Green).
  • This week, the Senate unanimously passed a bill legalizing hemp. SB 57, sponsored by Sen. Hill (R - Zanesville) and Sen. Huffman (R - Tipp City), decriminalizes hemp and hemp produces as well as establishing a help cultivation licensing program.
  • Auditor of State Keith Faber has requested an increase of $10 million in HB 166, the state operating budget bill to help offset the cost for local governments of state audits.
 
 
2019 OML LOBBYING DAY A SUCCESS
 
 
The League wants to thank all of the local leaders who came to Columbus this past Wednesday to participate in our Lobbying Day. Attendees were briefed by Executive Director Kent Scarrett on the pressing issues in both the Transportation Budget and the newly-introduced State Operating Budget before heading to previously-scheduled meeting with their legislative delegations.
 
Municipal leaders from across the state had the opportunity to share the stories and concerns of their local communities with state representatives and senators. These face-to-face conversations are not only powerful and effective lobbing efforts, but they create vital relationships between state and local leaders. Lobbying Day participants were able to forge new relationships with their legislators or strengthen existing relationships.
 
This new legislature and administration have made it clear they are interested in strengthening the partnership between local governments and the state. The local leaders who attended the League's Lobbying Day played a crucial step in building that relationship. We want to thank each municipal leader who took the time to come to Columbus and make important connections with state legislators, as the voices of local leaders will continue to play a vital role in policy making at the Statehouse in the months and years to come.
 
 
TRANSPORTATION BUDGET DELIBERATIONS CONTINUE
 
 
As of Friday afternoon, members of the conference committee for Sub. HB 62, the Transportation Budget, continue to deliberate over what will be included in the final language of the bill. The conference committee has had hearings on the calendar for the past two days, but have had to delay and ultimately cancel those meetings due to the inability to reach a consensus. The Legislative Service Commission has produced a comparison document listing the differences in the proposals for the transportation budget between the administration, House and Senate. It can be accessed HERE.
 
There are a number of issues yet to be resolved in the legislation and several of those are matters important to Ohio municipalities; particularly what amount will finally be agreed upon for an increase in the gas tax. Yesterday, the Governor and the House reached an agreement of an 11-cent increase for the motor fuel tax and a 20-cent increase for the diesel fuel tax; however, thus far, the Senate has not agreed to those terms.
 
It remains unclear if the legislature will act on the bill today or will resume work next week. As of Friday afternoon, both the House and the Senate are scheduled to hold sessions today to receive the committee's report and vote to concur on the final transportation budget package.
 
We want to thank our members for reaching out to their members of the House and Senate to communicate the need for a greater investment in our roads and bridges. Your voices have been heard and have been instrumental in helping educate legislators on the critical condition Ohio's municipalities are in and the need to work together to find our way out of these challenges.

When final action is taken on the budget bill, we will alert our members.
 
 
 
LEAGUE IDENTIFIES ASPECTS OF GOVERNORS PROPOSED BUDGET AFFECTING MUNICIPALITIES
 
 
Late last week, Governor DeWine released his proposed State Operating Budget for FY 20 and FY 21. The legislation, HB 166, projects a total of $150.4 billion in all funds appropriations, as compared to the previous budget, with $132.8 billion in all funds appropriations.
 
General Highlights: As for General Revenue Fund (GRF) spending, Medicaid accounts for 23.8% of state funds allocated. Primary and secondary education accounts 34.6% of state spending. Gov. DeWine's proposed budget would appropriate $550 million to partner local organizations and school in order to provide support services for students in need. This would include wraparound services, mental health counseling, after-school programs and health care.

The proposed budget would triple funding for indigent defense from $30 million to $90 million. Another substantial change is a proposal to increase the minimum age for tobacco purchasing from 18 to 21. This would reduce sales and use tax revenues by $6.7 million over the biennium, while reducing the cigarette and OTP tax by $33 million.
 
When rolling out the Governor's budget proposal, the administration noted that economic growth is projected to slow, due in part to Ohio's aging population. However, average wages seem to have risen, accounting for some of those demographic changes. The administration has based the budget on a slow but steady continued growth in existing revenue sources, with overall revenues projected to rise by 3.9% in FY 20 and 1.7% in FY21. The second year's projections are based on an anticipated national economic slowdown.
 
The bill contains several provisions impacting municipalities - both negatively and positively. We've listed them below:
 
Provisions supported by the League:
  • Local Government Fund (LGF) Increase: The Governor's proposed budget includes a 9.1% increase to the LGF in FY 20 and a 1.8% increase in FY 21.
  • Tax Increment Financing (TIFS). Would allow local governments to extend TIFS to an additional 30 years for large, high-impact developments.
  • Local Crisis Services. Would fund local crisis services related to substance use disorder with General Revenue Funds (GRF) rather than diverting funds from the LGF.
  • Opportunity Zones. Would conform Ohio law to include the Opportunity Zones established in the Tax Cuts and Jobs Act of 2017 for economically-distressed communities to attract businesses that will invest in revitalizing local communities.
  • Ohio Business Gateway (OBG). Increases funding for the OBG by 295.34% in FY 20.
  • Local Government Audit Support. Allocates $10 million each fiscal year for local government audit support.
  • Bureau of Criminal Investigation (BCI) Lab Testing. Allocates a total of $21 million over the biennium for BCI lab tests, defraying the cost that would otherwise be passed to local governments.
Provisions opposed by the League:
 
  • Property Tax Replacement Phase-Out. Would phase out the Property Tax Replacement for local governments. For FY19, the Property Tax Replacement was $16.9 million.
  • Multi-Agency Radio Communication (MARCS). MARCS provides state-of-the-art wireless digital communications to first responders and public safety providers and promotes interoperability. The Governor's proposal defunds the MARCS local government fee offset. The administration has not funded the local government fee offset for MARCS in the past; however, that funding was always restored by the General Assembly. The League is requesting that legislators restore the fee offset.
  • Municipal Net Profit Estimated Payments. Mandates that if a municipality receives a negative distribution from the state for business net profit filings through the OBG, the municipality must pay the amount of the deficiency to the state to balance the state's books.
The bill has been assigned to the House Finance Committee. We strongly encourage our members to speak with their legislators about the need for addition LGF funding and that any municipal taxes changes should not be included in a state operating budget but rather should be addressed in separate, stand-alone legislation so that taxpayers and municipal revenues do not continue to suffer due to state imposed municipal tax changes buried in a 1,800plus page budget bill.
 
Components of the bill will be separated by subject matter and assigned to subcommittees for more detailed review. If you would like access to the bill language in full, click HERE. Other budget related material can be found at www.obm.ohio.gov/budget.
 
As hearings on the bill begin and more information becomes available, the League will keep our members updated on the bill's proceedings through the legislative process.
 
 
 
 
NEW LEGISLATION: BILLS OF MUNICIPAL INTEREST INTRODUCED THIS WEEK
 
 
  • HB 169 - IMMIGRATION LAWS (AKA: SANCTUARY CITIES). Sponsored by Rep. Keller (R - Middletown) and Rep. Antani (R - Miamisburg), would require state and local authorities to cooperate with the federal government in the enforcement of immigration laws, to sanction those that fail to do so, and to declare an emergency. 
 
  • HB 163 - WATER/SEWER SERVICE. This bill, which is almost identical to HB 62 from the previous GA which was introduced by Rep. Duffey, this version is sponsored by Rep. Brinkman (R - Cincinnati), would create a process for withholding Local Government Fund (LGF) and state water and sewer assistance from municipal corporation that engage in certain water and sewer practice with respect to extraterritorial service.
 
 
COMMITTEE UPDATE: BILLS OF MUNICIPAL IMPACT
 
 
Here are the bill impacting municipalities that received committee hearings this week:
 
  • 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 second hearing before the House Ways and Means Committee, representatives from the Ohio Legal Assistance Foundation and the Cuyahoga County Board of Revision testified in support of the bill. The League is supportive of this legislation.
 
  • 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 second hearing before the House Ways and Means Committee, a private citizen and a representative for Americans for Prosperity-Ohio of the bill argued the bill would help the average person understand ballot language. The League is opposed to this legislation.
 
  • HB 126 - SINGLE-SUBJECT RULE. 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 first hearing before the House Civil Justice Committee, the bill's sponsor explained the bill would mandate that a single subject rule challenge could only be filed within one year of a bill's passage. The League is opposed to this legislation.
 
  • 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 the bill's second hearing before the Senate Judiciary Committee, the bill was amended to include Ohio National Guard members operating remotely piloted aircraft as exempted as well. Proponents from the Ohio National Guard and the Ohio Fire Chiefs Association testified in support of the bill. The League is neutral on this legislation.
 
  • HB 84 - CAPITAL PROJECTS. Sponsored by Rep. Holmes (D - McDonald), would expressly include, as eligible projects under the State Capital Improvements Program, water and sewer laterals located on private property. During its first hearing before the House state and Local Government Committee, the bill's sponsor explained the bill addresses the needs identified by the Ohio Public Works Commission years ago, where it was revealed that pipes on private property that tie in to main municipal lines need repaired or replaced. The League is supportive of this legislation.
 
 
 
BILLS OF MUNICIPAL INTEREST PASSED BY HOUSE AND SENATE
 
Here are the bills impacting municipalities that
  • SB 7 - OCCUPATIONAL LICENSING. Sponsored by Sen. Lehner (R - Kettering) and Sen. Hackett (R - London), is regarding temporary state occupational licenses for members of the military and their spouses. The bill was voted out of the Senate unanimously.


COMMITTEE SCHEDULE FOR THE WEEK OF MARCH 31, 2019

Tuesday, April 2, 2019
SENATE FINANCE
Tue., Apr. 2, 2019, 2:30 PM, Senate Finance Hearing Room
Sen. Dolan: 614-466-8056
OR AFTER SESSION
 
MIXED USE DEVELOPMENT PROJECTS-TAX CREDIT (SCHURING K) To authorize an insurance premiums tax credit for capital contributions to transformational mixed use development projects. 
 
Second Hearing, Proponent Testimony
 
INCREASE SOLID WASTE DISPOSAL FEE (EKLUND J) To increase state solid waste disposal fee that is deposited into the Soil and Water Conservation District Assistance Fund, and to make an appropriation. 
 
Second Hearing, Proponent Testimony
 
HOUSE CIVIL JUSTICE
Tue., Apr. 2, 2019, 3:00 PM, Hearing Room 113
Rep. Hambley: 614-466-8140
 
INDEMNITY PROVISIONS-PUBLIC IMPROVEMENT CONTRACTS (BLESSING III L) To regulate the use of indemnity provisions in professional design contracts related to public improvements. 
 
First Hearing, Sponsor Testimony
 
ONE-SUBJECT RULE TIMELINE (HILLYER B) To 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. 
 
Second Hearing, Proponent Testimony
 
 
SENATE WAYS AND MEANS
Tue., Apr. 2, 2019, 4:00 PM, Senate Finance Hearing Room
Sen. Terhar: 614-466-8068
 
TAX CREDITS-OHIO OPPORTUNITY ZONE (SCHURING K) To authorize tax credits for investments in an Ohio Opportunity Zone. 
 
Fifth Hearing, All Testimony, AMENDMENTS/POSSIBLE VOTE
 
Wednesday, April 3, 2019
SENATE JUDICIARY
Wed., Apr. 3, 2019, 9:15 AM, North Hearing Room
Sen. Eklund: 614-644-7718
For SB33, committee will hear in-person testimony from the first five people to submit remarks, and accept any additional testimony as written-only.
 
PUBLIC RECORDS LAW EXEMPTION-EMERGENCY SERVICE TELECOMMUNICATORS (ROEGNER K) To include emergency service telecommunicators as individuals whose residential and familial information is exempt from disclosure under the Public Records Law. 
 
Third Hearing, All Testimony, AMENDMENTS/POSSIBLE VOTE
 
CRITICAL INFRASTRUCTURE FACILITIES OFFENSES (HOAGLAND F) To modify certain criminal offenses with respect to critical infrastructure facilities and to impose fines and civil liability for damage to a critical infrastructure facility. 
 
Third Hearing, Opponent Testimony
 
SENATE HEALTH, HUMAN SERVICES AND MEDICAID
Wed., Apr. 3, 2019, 2:30 PM, South Hearing Room
Sen. Burke: 614-466-8049
 
MASSAGE THERAPY LICENSING (BRENNER A) To make changes to the massage therapy licensing law. 
 
First Hearing, Sponsor Testimony
 
PLEASE CHECK OUR WEBSITE MONDAY FOR ANY CHANGES TO THE COMMITTEE SCHEDULE
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Edward Albright, Deputy Director
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Thomas Wetmore, Legislative Advocate

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