OML UPDATE AT-A-GLANCE  

Here are the top three things you need to know from this past week:

 

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:

 

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:

 

 

   

INTRODUCED: BILLS OF MUNICIPAL INTEREST

 

Here is a bill introduced this week that impacts municipalities:

 

   

COMMITTEE RECAP: BILLS OF MUNICIPAL INTEREST

 

Here are the bills impacting municipalities that received committee hearings this week: