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Ohio Statehouse Update: Week in Review — May 4, 2012


1. Energy MBR bill changes

The Senate Energy and Public Utilities Committee accepted a substitute version of Senate Bill 315, Governor Kasich’s Mid Biennium Review (MBR) bill focusing on energy policy. A majority of the changes included in the sub bill deal with the Governor’s proposed changes to horizontal drilling regulations. 

According to the summary provided to the committee, the sub bill:

  • Removes the increase in the amount of the injection well disposal fee added by the bill, returning the rate of the fee to current law.
  • Exempts from regulation as a public utility pipeline company an entity engaged in the business of the transport associated with gathering lines, raw natural gas liquids or finished product natural gas liquids.
  • Removes provisions in the bill that authorize the Director of the Ohio EPA to apply for approval from the U.S. EPA to assume responsibility for administering the Section 404 permitting program.
  • Revises the authority of the Chief of Oil and Gas to enter into cooperative agreements with other state agencies by specifying that the agreements must be for the advice and consultation, including visitations at the surface location of a well on behalf of the Division of Oil and Gas Resources Management. These cooperative agreements do not confer on other state agencies the authority to administer or enforce the Oil and Gas Law and maintain the Division’s sole and exclusive authority established in the law.
  • Freezes the funding for the Ohio Consumers’ Counsel at FY 2012 levels.
  • Expands the definition of advanced energy resources to include any new or repowered generating facility located in Ohio.
  • Allows the Ohio Power Siting Board to adopt rules to provide an accelerated review for:
    1. An electric transmission line that is needed to meet the requirements of a specific customer or necessary to maintain reliable electric service as a result of the retirement or shutdown of an Ohio located electric generating facility due to environmental laws, rules or requirements,
    2. Certain electric generating facilities that use waste heat or natural gas and
    3. A gas pipeline that is primarily needed to meet the requirements of a specific customer.

The bill is scheduled for possible amendments and a possible vote on May 9, 2012.

2. General MBR receives Senate consideration

The Senate Finance Committee began hearings on the Governor’s general MBR bill, HB 487 this week. During his testimony, Office of Budget and Management (OBM) Director Tim Keen provided an update on Ohio’s fiscal condition, saying the state has added 72,400 net new jobs since January 2011. This puts Ohio first in the Midwest and fifth in the nation in job creation. Keen said while economic uncertainty remains, projected moderate economic growth is reflected in state General Revenue Fund (GRF) figures—total GRF state tax receipts are modestly above estimate by $265.4 million or two percent.

The Director cautioned against spending anticipated surplus funds at the end of the fiscal year, citing a House amendment that was added to the bill which prohibits the transfer of any such surplus into the Budget Stabilization Fund without authorization by the General Assembly. He said the administration would not support additional net spending due in part to uncertainty with pending litigation surrounding the JobsOhio/liquor transaction and federal grants revenue underage due to Medicaid under spending.

Keen encouraged the Senate to revisit the Governor’s income tax reduction proposal. The reduction was funded through an increase in Ohio’s severance tax—both provisions were removed from pending legislation and have not received committee consideration. Conversely, he asked for removal of the $30 million increase in spending for nursing homes, which was added by the House.

The Director stated his intention to request an amendment that would allow OBM the authority to access the Budget Stabilization Fund at the close of FY 12 or FY 13, if necessary, to provide for an orderly, balanced closing to either fiscal year.

Additional testimony was given by the Governor’s Office of Health Transformation Director Greg Moody. He echoed Director Keen in stating the administration’s opposition to increasing funding for nursing homes and stated opposition to a House-added provision which codifies the Medicaid health plan payments to hospitals. Apart from these provisions, and a few cleanups, the health and human services proposals in the as-introduced version of HB 487 were largely unchanged.

In speaking to the merger of the State Architect’s Office with the School Facilities Commission into a new Facilities Construction Commission, Department of Administrative Services Director Robert Blair said both entities currently have similar missions and staff. He said combining the two entities makes good government sense and will result in fiscal savings.

3. Legislation approved this week

The Ohio Senate met on May 1 and 3, 2012 and approved the following bills:

Senate Bill 314: Sponsored by Senators Mark Wagoner (R- Toledo) and Capri Cafaro (D- Hubbard), the bill renames the Department of Development the “Development Services Agency,” and makes various changes to programs within the department. It establishes the Office of TourismOhio within the Agency, eliminates the Development Financing Advisory Council and provides for situations in which projects are started prior to the award of a job creation tax credit by the Ohio Tax Credit Authority.

House Bill 99: Sponsored by Representatives Rex Damschroder (R- Fremont) and Nancy Garland (D- New Albany), the bill prohibits driving a vehicle while writing, sending or reading a text-based communication on a handheld electronic wireless communications device and establishes the violation as a secondary traffic offense. Additionally, it prohibits a person who is less than 18 years of age from using, in any manner, an electronic wireless communications device while driving and requires driver education courses to include instruction in the dangers of texting while driving.

Senate Bill 160: Sponsored by Senator Kevin Bacon (R- Columbus), the bill requires:

  • Any judicial release hearing be held not less than 30 days or more than 60 days after the date on which the motion is filed,
  • Generally requires a prosecuting attorney who receives notice that a court has scheduled a judicial release hearing with respect to a first, second or third degree felony offense of violence to notify the victim or the victim’s representative of the hearing regardless of whether they requested notification,
  • Specifies that the notice is not to be given if the victim or victim’s representative “opts out” of the mandatory notice, and
  • Provides for notice of the opportunity to opt out of future notices.

Senate Bill 301: Sponsored by Senator David Burke (R- Marysville), regarding enforcement powers of certain healthcare professional licensing boards, regulation of pain management clinics, limits on prescriber-furnished controlled substances, and classifications of certain controlled substance.

Senate Bill 305: Sponsored by Senator Jim Hughes (R- Columbus), the bill prohibits a person from knowingly designing, building, constructing, or fabricating a vehicle with a hidden compartment, or modifying or altering any portion of a vehicle to create or add a hidden compartment, with the intent to facilitate the unlawful concealment or transportation of a controlled substance. Further, the bill prohibits a person from knowingly operating, possessing or using a vehicle with a hidden compartment with knowledge that the hidden compartment is used or intended to be used to facilitate the unlawful concealment or transportation of a controlled substance.

Senate Bill 331: Sponsored by Senator Tom Patton (R- Strongsville), the bill increases the maximum total amount of tax credits allowed for completion of motion pictures certified as tax credit-eligible productions from $20 million to $40 million per fiscal biennium.

For more information, please contact:

Michael Caputo
(non-attorney professional)

Rebecca M. Kuhns
(non-attorney professional)

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© 2012 McDonald Hopkins LLC All Rights Reserved. This Alert is designed to provide current information for our clients, friends and their advisors regarding important legal developments. The foregoing discussion is general information rather than specific legal advice. Because it is necessary to apply legal principles to specific facts, always consult your legal advisor before using this discussion as a basis for a specific action.