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Ohio Statehouse Update: Week in Review — February 10, 2012

1.  Kasich gives State of the State Address

Governor John Kasich gave his State of the State address from Wells Academy in Steubenville this week. The governor said he chose the location because the school is the highest performing in the state and because it is close to where he grew up in McKees Rocks, Pennsylvania.

The governor provided an overview of his first year in office, highlighting legislative successes. Among the areas mentioned were eliminating an $8 billion budget deficit without raising taxes, enacting sentencing and construction reform, and lifting the cap on the number of charter schools in Ohio.

Job creation

A majority of his speech was focused on the administration’s job creation and retention efforts. The governor said Ohio is now the 9th highest job creator in the nation, up from 48th the previous year. He said 43,500 new jobs were created this year, and companies have committed to $3.2 billion in new capital investment.

Among the initiatives the governor said he would be working on this year are additional efforts to curb human trafficking in Ohio, studying the possible lease of the Ohio Turnpike, education reform, and making improvements to OARnet—Ohio’s broadband network.


Additionally, the governor said Ohio needs an energy policy. While he said renewable energy is becoming more affordable, he said the state should consider other forms of energy, such as capturing waste heat. When speaking on natural gas fracking, the governor was interrupted by several anti-fracking protestors. Kasich said tough environmental rules were needed for the industry to ensure safety during the fracking process.

Workforce Development

Finally, the governor spoke about his upcoming workforce development initiative. He said there are currently 80,000 unfilled jobs in the state, largely because there are not qualified workers for the positions. He said he will soon have a workforce training reform plan that will work with community colleges, vocational schools and current state programs. The governor said there are 77 different workforce development programs located in 13 state agencies, which Rich Frederick, the governor’s assistant policy director for workforce development, will work to streamline.

2. PUCO to resolve AEP small business customer rate issues

The Public Utilities Commission of Ohio (PUCO) today announced that it will soon address the significant impacts that AEP rate changes are having on General Service 2 customers, which primarily includes small business, school district and local government customers. The commission announced the plan after hearing from more than 200 affected customers who are faced with exorbitant bill increases that will have a lasting negative impact on operations.

“My fellow commissioners and I are deeply troubled by what we have heard from business owners, elected officials, and the governor on this issue,” PUCO Chairman Todd A. Snitchler stated.

Last December, the PUCO modified and approved an agreement in AEP-Ohio’s electric security plan case. Under the modified agreement, AEP will transition to a market-based generation rate structure over a four and a half year period from 2012 to 2016. AEP will separate its generation and distribution assets, and, beginning in June 2015, procure electricity for customers through competitive auctions.

The agreement was signed by a variety of parties representing manufacturers, energy suppliers, and environmental groups, and included new charges to recover several hundred million dollars in deferred distribution and fuel costs, as well as costs to transition to the market-based model.

According to the Commission, allocation of these rate impacts among customer classes were based upon figures and information provided by AEP. It was not clear to the Commission at the time that General Service 2 customers would be adversely impacted by the new rate structure.

The Commission intends to resolve the rate impacts faced by affected customers by the end of February.

The PUCO encourages affected customers to file written comments online in case 11-346-EL-SSO. Additional information regarding the AEP rate changes and impacts on small business is available at www.PUCO.ohio.com

3.  Legislation approved this week

The Ohio House met on February 8, 2012 and passed the following bills:

  • House Bill 292: Sponsored by Representative Anne Gonzales (R- Westerville), the bill would establish licensure requirements for genetic counselors and modify certain laws governing the State Medical Board.
  • House Bill 365: Sponsored by Representative Peter Beck (R- Mason), the legislation would allow taxpayers who claim an enhanced federal income tax depreciation deduction to reduce the amount of the deduction the taxpayer must add-back for Ohio income tax purposes if the taxpayer increases payroll in the year the enhanced federal deduction is taken by at least 10 percent over the preceding year.

The House and Senate are scheduled to hold voting sessions on February 14 and 15.

For more information, please contact:

Michael Caputo
(non-attorney professional)

Rebecca M. Kuhns
(non-attorney professional)

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