Legislative News

The Ohio House voted overwhelmingly Wednesday to advance legislation that provides immunity to architects who might find themselves offering services as they respond to emergency situations.

The House voted overwhelmingly Wednesday to advance legislation that provides immunity to a number of professionals who might find themselves offering services as they respond to emergency situations.

Al Landis (R-Dover) HB 17 shields architects, contractors, engineers, surveyors, and tradespersons who are working on response efforts during declared emergencies.

The lawmaker said those offering services at a time of crisis shouldn’t have to be worried that their efforts could leave them subject a lawsuit. “We want our ‘A team’ in the game, not on the bench” during times of emergency, he said.

Rep. Bill Blessing (R-Cincinnati), a primary co-sponsor, added that the immunity wouldn’t apply in cases of willful or wanton misconduct.

The bill was approved on a 92-0 vote.

As expected with such a comprehensive plan, members of the House Finance Committee peppered Tax Commissioner Joe Testa with their concerns about various aspects of Gov. John Kasich’s tax reform proposal. There are 22 separate tax changes contained in House Bill 64, the proposed 2016-17 state biennial budget. The bill would reduce personal income taxes (PIT) by $5.7 billion and raise sales, commercial activity (CAT) and other taxes by $5.2 billion, resulting in a net two-year tax cut of $523 million.

The PIT reductions would come in the form of a 23 percent across-the-board cut, lowering the top rate to 4.1 percent. In addition, the plan would eliminate the PIT for certain owners of pass-through entities, such as partnerships and S corporations, on their individual share of business profits. Business owners could only qualify if their pass-through business has $2 million or less in gross receipts. HB 64 would also significantly increase the personal exemption for taxpayers with less than $80,000 in taxable income.

However, it was the proposed tax increases in HB 64 that garnered the lion’s share of the House committee’s attention. One committee member questioned why cable TV services should become subject to state sales tax since local jurisdictions already levy a franchise fee that is equivalent to a tax. Several members raised concerns, shared by the Ohio Chamber, that the proposed 23 percent CAT rate increase would make Ohio less competitive, particularly for manufacturing investment and jobs. Such a CAT increase would also negatively affect retailers and other high volume, low margin businesses.

Legislators also expressed concerns about how the proposed severance tax increase on oil and natural gas might adversely affect future production and drilling activity in the Utica Shale play. Others were alarmed about the potential impact on lower-income Ohioans of raising the state sales tax a half-penny from 5.75 to 6.25 percent and substantially raising cigarette and other tobacco taxes.

Finally, an issue that was not specifically discussed by the committee is the proposed extension of the sales tax to “management consulting services”. While legal, accounting and other financial services are not specifically listed in the new services proposed to be taxed, the exceedingly broad definition of “management consulting services” in HB 64 would likely reel in many legal, accounting and other finance- and business planning-related services purchased by businesses.

The tax provisions of HB 64 will now be heard by the House Ways & Means Committee, which has scheduled a hearing for Tues., Feb. 17. 

During a February 17 hearing the Ohio House Commerce and Labor Committee received testimony from AIA Ohio Immediate Past President, Elizabeth Murphy, FAIA in support of HB 17 which would provide a volunteer architect, engineer, surveyor or contractor with qualified immunity from civil liability for any acts, errors, or omissions conducted in the performance of professional services that are requested by government officials, for a building, structure, piping, or other engineered system during a declared emergency and 90 days thereafter.

Following testimony the Committee unanimously recommended the bill for passage by the House of Representatives.

AIA Ohio’s proposed “Good Samaritan” bill, HB17, received a Sponsor Hearing February 11 by the Ohio House of Representatives Commerce and Labor Committee.  The bill, introduced by Rep. Louis Blessing III (R-Cincinnati) and Rep. Al Landis (R-Dover) would  provide civil immunity for architects, contractors, engineers, surveyors, and tradespersons providing volunteer services during a declared emergency.

Reps. Blessing and Landis gave sponsor testimony on the bill and said it “grants civil immunity to engineers, architects, and surveyors volunteering during a declared emergency under the purview of a body authorized to act in an official capacity.”  The representatives described a scenario where altruism could lead to being sued.

“This is precisely why this bill is great: it encourages more volunteer work – a great value to the public as engineering services are not cheap – by removing barriers that discourage such work … without risking liabilities,” Blessing concluded.

Blessing told Chairman Young that the bill is the same as the version that passed the House 90-0 during the last General Assembly.

There were no questions.

After two Republican senators chided the agency for a lack of details in a funding request. the Ohio Department of Transportation (ODOT) requested that a $100 million item be deferred during a January 26 meeting of the Ohio Controlling Board.

Johann Klein, ODOT legislative liaison, told Controlling Board Interim President Robin McGuire Rose the agency will defer until next meeting the request seeking approval of capital funds for the construction of highway maintenance facilities through the Ohio Facilities Construction Commission (OFCC). The request also seeks a more than $51 million contract with the Ohio Council of Port Authorities (OCPA).

read more…

Vetoed by Governor Kasich in the Mid Biennium Review Bill (HB483) was language that would have changed funding priorities under School Facilities Commission programs for districts that had a large reliance on tangible personal property taxes, which were eliminated in 2005.

The impact on some districts has been that they have less local revenue to pay their share of the cost of new building construction and they’re also kept low on the priority funding list. The bill language would have moved five districts up on the list in fiscal year 2015 and required a total of $97.5 million more in state share for their projects, according to the fiscal analysis.

Rep. Tim Derickson (R-Oxford) had sought the language in past budget bills only to see it vetoed by both Gov. Kasich and Gov. Ted Strickland before him.

“Under this item, schools would be able to unilaterally change the project agreements they reached with the state in order to reduce their costs,” Gov. Kasich wrote.

The Ohio House of Representatives today passed the $2.4 billion bricks-and-motar Capital Bill, HB 497, by a vote of 88-2.  The bill now goes to the Senate where speedy action is expected.

Facing an early April target date for enacting the latest capital appropriations measure, House members on Tuesday delved into the nearly $2.4 billion bricks-and-mortar package with an eye toward sending it to the Senate by the end of the month.

If it plays out as expected – and like that last capital bill – the latest iteration (HB 497) will be processed quickly with few substantive changes. The project list has already been vetted extensively behind the scenes by Gov. John Kasich’s administration and his fellow Republicans in control of both chambers of the General Assembly.

The capital bill’s introduction and first hearing came as the House GOP, as promised, split up the governor’s mid-biennium review budget into separate bills that will be heard in 11 different committees. (See separate story) The two budget packages are expected to consume much of the legislature’s attention during the spring session.

Providing introductory testimony to the House Finance & Appropriations Committee, Office of Budget and Management Director Tim Keen said the recommended expenditures for the fiscal year 2015-2016 capital biennium were “made after a careful process that has prioritized the most pressing needs of state government, schools and higher education, with particular emphasis given to each project’s impact on jobs and economic growth.”

“Most expenditures are focused on necessary maintenance and upkeep of the state’s current capital assets, while much of the new construction funded in this bill is used to replace existing facilities that are no longer cost-effective to repair,” he said.

The bill also contains capital “reappropriations,” or generally noncontroversial provisions that allow for ongoing projects to receive continued funding. Mr. Keen explained that the reappropriations are necessary because spending authority is limited to two years.

Of the bill’s $2.38 billion in capital appropriations, $2.07 billion is in general revenue fund-backed bonds and the rest – $317.1 million – comes from various sources outside of the GRF, according to the administration.

The bill includes:

·       $675 million for local school construction projects overseen by the Ohio School Facilities Commission.

·       $574.3 million for maintenance and renovations at state-owned facilities including state parks, prisons, mental health facilities and other public buildings.

·       $454.5 million for Ohio’s 37 public colleges and universities.

·       $369 million for local infrastructure projects administered by the Ohio Public Works Commission.

·       $100 million for the Clean Ohio program for outdoor recreation projects and the preservation of open spaces and farmlands.

·       $160 million for “community projects.”

Mr. Keen said the governor followed the process of the last capital budget (HB482, 129^th General Assembly) in crafting the allocation to colleges and universities.

“The governor has again asked higher education to take the lead in developing a collaborative capital funding request that prioritizes the needs of the entire university system ahead of the desires of individual institutions,” he told panelists. “The capital bill before you presents, as adopted, the collaborative committee’s recommendations for the funding of campus-level projects.”

The OBM director said the majority of the higher education funds – $356 million – are targeted to maintenance and repair of existing campus facilities.

Some of the non-GRF funds will go for ongoing work at OSFC, which has already spent billions in matching funds to build and maintain local schools.

Of the $675 million appropriated in the bill for K-12 buildings, $575 million is in GRF-backed debt and $100 million is from “lottery profit proceeds attributed to the video lottery terminal licensing fees to be paid by the racetracks,” Mr. Keen said.

“These VLT license fees are upfront, one-time fees and therefore represent non-recurring revenue. As a result, we believe it is appropriate to again apply these one-time revenues toward school construction projects, as was done in the current capital budget.”

Another non-GRF chunk – $69 million – comes from a Revolving Loan Fund for local infrastructure projects under the PWC that’s part of a total of $444 million in mostly bonds allocated for such work, the OBM director said.

In regards to state agency capital needs addressed in the bill, Mr. Keen said, “The governor’s recommended appropriations are necessary to protect our state infrastructure and maintain the physical facilities in which the citizens of Ohio have already made a significant financial commitment.”

Among the agency allotments is $130 million for the Department of Rehabilitation and Correction, which is experiencing a jump in the prison population despite extensive measures to divert low-level offenders.

“This level of appropriation represents a significant increase from the department’s capital budgets in recent years, but is necessary because prisons constructed 30 years ago are entering a phase that will require more intensive renovations,” Mr. Keen said.

One of the larger agency allocations – $236.4 million – would go to the Department of Natural Resources.

“As you know, Ohio can take pride in having one of the highest rated, most diverse and most heavily visited state park systems in the nation. But this is also a system that’s showing its age, as recreational facilities built in the 1950s and 60s are past due for long-delayed repairs and renovations,” Mr. Keen said. “Appropriations in HB497 take an important step to remedy that situation in our state parks and other ODNR facilities.”

The bill also authorizes two technology projects to be funded with Certificates of Participation, an alternative funding mechanism to GRF-backed bonds under which investors purchase a share of lease revenues of a program rather than bonds being secured by those revenues.

The COP projects in the bill include $45 million for the Department of Administrative Services to implement the Enterprise Data Center Solutions project and $10 million for the state treasurer’s office to replace outdated computers with a new Treasury Management System.

Mr. Keen said the bill contains a few language updates to go along with the appropriations, mainly clean-up provisions related to the dissolution of the Ohio Bonding Authority and the reinstatement of the Transportation Building Fund.

While the administration did not specifically delineate community projects included in the proposed bill, several items requested by eight regional economic development groups and a committee charged with vetting arts projects throughout the state surfaced among the appropriations.

For example, the bill includes a $5 million appropriation for restoration of Cincinnati’s Union Terminal – funding which exceeded the $3.2 million requested.

The legislation also calls for a $2 million appropriation for the Cleveland Museum of Art, which requested $1 million for an expansion, and a $1.1 million appropriation for the Columbus Museum of Art – the full amount requested.

Budget Director Tim Keen presented the first full capital budget in years to lawmakers, saying Gov. John Kasich’s administration now feels the state’s finances are healthy enough to return to supporting local projects. 
The $2.39 billion budget, introduced by Rep. Ron Amstutz (R-Wooster) as HB497, includes funding for K-12 and higher education building projects, the Public Works Commission, state parks and prisons, the Clean Ohio program and community projects. 

The budget director said in testimony to the House Finance and Appropriations Committee that the administration would like to see the bill passed and signed by April 2 so it can go into effect by July 1, preventing an interruption in ongoing projects funded by re-appropriation of previous capital funds also included in the bill.

Keen said the $2.39 billion package is comparable to the last capital budget introduced under normal circumstances. There was no capital budget in 2010, and Kasich sought a scaled-back budget in 2012 based on the state’s financial troubles. Prior to that, capital budgets were inflated by securitization of tobacco settlement payments sought by the Strickland administration, Keen said. 

The biggest chunks of funding in the package include almost $500 million for the Board of Regents and higher education institutions, $675 million for school facilities projects and $444 million for the Ohio Public Works Commission.

Keen said the $236.4 million appropriated for the Ohio Department of Natural Resources is aimed at helping to reduce the significant list of deferred maintenance projects at state parks and forests.

Keen said the budget includes a historically higher amount of money for improvements at state prisons. The $130 million appropriated to the Department of Rehabilitation and Correction is driven by the fact that some decades-old prisons are getting to the point of needing extensive renovations, including roof replacements, new HVAC systems and other upgrades. Youth detention facilities get $36.1 million, which among other projects will pay for new housing units at a Circleville facility, with new housing at other facilities slated for future biennia.

The Ohio Department of Transportation also gets a larger-than-usual allocation of $100 million in HB497, which Keen said reflect the development of a multi-year plan for systemically addressing maintenance facility needs.

Keen said the budget also departs from past practice of not funding technology projects via capital spending on two matters: $45 million for cloud-computing and other statewide IT upgrades at the Department of Administration Services and $10 million to replace the banking system at the state treasurer’s office. The current system is so old that it can’t get security upgrades and could be vulnerable to cyber-attacks, Keen said.

Reps. Denise Driehaus (D-Cincinnati) and Jack Cera (D-Bellaire) brought up local officials’ frustrations with their project requests being deemed ineligible for capital funding. Keen said borrowing authority is limited to specified purposes, and said if he could go back he would have emphasized that point more heavily in giving guidance to local officials. Keen said the fact that this is the first normal capital budget in six years might have contributed to the problem. 

Keen told Rep. Debbie Phillips (D-Athens) that he believes funding in HB497 for improvements at the state fairgrounds and Ohio Expo Center will be sufficient to keep the All-American Quarter Horse Congress returning to Columbus. The Expositions Commission is in line for $49 million in the bill, $38 million of which is for an all-purpose exhibition building and a new animal exhibit building.

Cera noted the increase in prison appropriations, along with a burgeoning inmate population, and asked if the state will need to build more prisons. Keen said the administration would prefer to focus on community corrections, noting part of the Department of Rehabilitation and Correction appropriation is for that purpose. 

The Ohio House voted overwhelmingly Wednesday to advance legislation that provides immunity to architects who might find themselves offering services as they respond to emergency situations.

The House voted overwhelmingly Wednesday to advance legislation that provides immunity to a number of professionals who might find themselves offering services as they respond to emergency situations.

Al Landis (R-Dover) HB 17 shields architects, contractors, engineers, surveyors, and tradespersons who are working on response efforts during declared emergencies.

The lawmaker said those offering services at a time of crisis shouldn’t have to be worried that their efforts could leave them subject a lawsuit. “We want our ‘A team’ in the game, not on the bench” during times of emergency, he said.

Rep. Bill Blessing (R-Cincinnati), a primary co-sponsor, added that the immunity wouldn’t apply in cases of willful or wanton misconduct.

The bill was approved on a 92-0 vote.

As expected with such a comprehensive plan, members of the House Finance Committee peppered Tax Commissioner Joe Testa with their concerns about various aspects of Gov. John Kasich’s tax reform proposal. There are 22 separate tax changes contained in House Bill 64, the proposed 2016-17 state biennial budget. The bill would reduce personal income taxes (PIT) by $5.7 billion and raise sales, commercial activity (CAT) and other taxes by $5.2 billion, resulting in a net two-year tax cut of $523 million.

The PIT reductions would come in the form of a 23 percent across-the-board cut, lowering the top rate to 4.1 percent. In addition, the plan would eliminate the PIT for certain owners of pass-through entities, such as partnerships and S corporations, on their individual share of business profits. Business owners could only qualify if their pass-through business has $2 million or less in gross receipts. HB 64 would also significantly increase the personal exemption for taxpayers with less than $80,000 in taxable income.

However, it was the proposed tax increases in HB 64 that garnered the lion’s share of the House committee’s attention. One committee member questioned why cable TV services should become subject to state sales tax since local jurisdictions already levy a franchise fee that is equivalent to a tax. Several members raised concerns, shared by the Ohio Chamber, that the proposed 23 percent CAT rate increase would make Ohio less competitive, particularly for manufacturing investment and jobs. Such a CAT increase would also negatively affect retailers and other high volume, low margin businesses.

Legislators also expressed concerns about how the proposed severance tax increase on oil and natural gas might adversely affect future production and drilling activity in the Utica Shale play. Others were alarmed about the potential impact on lower-income Ohioans of raising the state sales tax a half-penny from 5.75 to 6.25 percent and substantially raising cigarette and other tobacco taxes.

Finally, an issue that was not specifically discussed by the committee is the proposed extension of the sales tax to “management consulting services”. While legal, accounting and other financial services are not specifically listed in the new services proposed to be taxed, the exceedingly broad definition of “management consulting services” in HB 64 would likely reel in many legal, accounting and other finance- and business planning-related services purchased by businesses.

The tax provisions of HB 64 will now be heard by the House Ways & Means Committee, which has scheduled a hearing for Tues., Feb. 17. 

During a February 17 hearing the Ohio House Commerce and Labor Committee received testimony from AIA Ohio Immediate Past President, Elizabeth Murphy, FAIA in support of HB 17 which would provide a volunteer architect, engineer, surveyor or contractor with qualified immunity from civil liability for any acts, errors, or omissions conducted in the performance of professional services that are requested by government officials, for a building, structure, piping, or other engineered system during a declared emergency and 90 days thereafter.

Following testimony the Committee unanimously recommended the bill for passage by the House of Representatives.

AIA Ohio’s proposed “Good Samaritan” bill, HB17, received a Sponsor Hearing February 11 by the Ohio House of Representatives Commerce and Labor Committee.  The bill, introduced by Rep. Louis Blessing III (R-Cincinnati) and Rep. Al Landis (R-Dover) would  provide civil immunity for architects, contractors, engineers, surveyors, and tradespersons providing volunteer services during a declared emergency.

Reps. Blessing and Landis gave sponsor testimony on the bill and said it “grants civil immunity to engineers, architects, and surveyors volunteering during a declared emergency under the purview of a body authorized to act in an official capacity.”  The representatives described a scenario where altruism could lead to being sued.

“This is precisely why this bill is great: it encourages more volunteer work – a great value to the public as engineering services are not cheap – by removing barriers that discourage such work … without risking liabilities,” Blessing concluded.

Blessing told Chairman Young that the bill is the same as the version that passed the House 90-0 during the last General Assembly.

There were no questions.

After two Republican senators chided the agency for a lack of details in a funding request. the Ohio Department of Transportation (ODOT) requested that a $100 million item be deferred during a January 26 meeting of the Ohio Controlling Board.

Johann Klein, ODOT legislative liaison, told Controlling Board Interim President Robin McGuire Rose the agency will defer until next meeting the request seeking approval of capital funds for the construction of highway maintenance facilities through the Ohio Facilities Construction Commission (OFCC). The request also seeks a more than $51 million contract with the Ohio Council of Port Authorities (OCPA).

read more…

Vetoed by Governor Kasich in the Mid Biennium Review Bill (HB483) was language that would have changed funding priorities under School Facilities Commission programs for districts that had a large reliance on tangible personal property taxes, which were eliminated in 2005.

The impact on some districts has been that they have less local revenue to pay their share of the cost of new building construction and they’re also kept low on the priority funding list. The bill language would have moved five districts up on the list in fiscal year 2015 and required a total of $97.5 million more in state share for their projects, according to the fiscal analysis.

Rep. Tim Derickson (R-Oxford) had sought the language in past budget bills only to see it vetoed by both Gov. Kasich and Gov. Ted Strickland before him.

“Under this item, schools would be able to unilaterally change the project agreements they reached with the state in order to reduce their costs,” Gov. Kasich wrote.

The Ohio House of Representatives today passed the $2.4 billion bricks-and-motar Capital Bill, HB 497, by a vote of 88-2.  The bill now goes to the Senate where speedy action is expected.

Facing an early April target date for enacting the latest capital appropriations measure, House members on Tuesday delved into the nearly $2.4 billion bricks-and-mortar package with an eye toward sending it to the Senate by the end of the month.

If it plays out as expected – and like that last capital bill – the latest iteration (HB 497) will be processed quickly with few substantive changes. The project list has already been vetted extensively behind the scenes by Gov. John Kasich’s administration and his fellow Republicans in control of both chambers of the General Assembly.

The capital bill’s introduction and first hearing came as the House GOP, as promised, split up the governor’s mid-biennium review budget into separate bills that will be heard in 11 different committees. (See separate story) The two budget packages are expected to consume much of the legislature’s attention during the spring session.

Providing introductory testimony to the House Finance & Appropriations Committee, Office of Budget and Management Director Tim Keen said the recommended expenditures for the fiscal year 2015-2016 capital biennium were “made after a careful process that has prioritized the most pressing needs of state government, schools and higher education, with particular emphasis given to each project’s impact on jobs and economic growth.”

“Most expenditures are focused on necessary maintenance and upkeep of the state’s current capital assets, while much of the new construction funded in this bill is used to replace existing facilities that are no longer cost-effective to repair,” he said.

The bill also contains capital “reappropriations,” or generally noncontroversial provisions that allow for ongoing projects to receive continued funding. Mr. Keen explained that the reappropriations are necessary because spending authority is limited to two years.

Of the bill’s $2.38 billion in capital appropriations, $2.07 billion is in general revenue fund-backed bonds and the rest – $317.1 million – comes from various sources outside of the GRF, according to the administration.

The bill includes:

·       $675 million for local school construction projects overseen by the Ohio School Facilities Commission.

·       $574.3 million for maintenance and renovations at state-owned facilities including state parks, prisons, mental health facilities and other public buildings.

·       $454.5 million for Ohio’s 37 public colleges and universities.

·       $369 million for local infrastructure projects administered by the Ohio Public Works Commission.

·       $100 million for the Clean Ohio program for outdoor recreation projects and the preservation of open spaces and farmlands.

·       $160 million for “community projects.”

Mr. Keen said the governor followed the process of the last capital budget (HB482, 129^th General Assembly) in crafting the allocation to colleges and universities.

“The governor has again asked higher education to take the lead in developing a collaborative capital funding request that prioritizes the needs of the entire university system ahead of the desires of individual institutions,” he told panelists. “The capital bill before you presents, as adopted, the collaborative committee’s recommendations for the funding of campus-level projects.”

The OBM director said the majority of the higher education funds – $356 million – are targeted to maintenance and repair of existing campus facilities.

Some of the non-GRF funds will go for ongoing work at OSFC, which has already spent billions in matching funds to build and maintain local schools.

Of the $675 million appropriated in the bill for K-12 buildings, $575 million is in GRF-backed debt and $100 million is from “lottery profit proceeds attributed to the video lottery terminal licensing fees to be paid by the racetracks,” Mr. Keen said.

“These VLT license fees are upfront, one-time fees and therefore represent non-recurring revenue. As a result, we believe it is appropriate to again apply these one-time revenues toward school construction projects, as was done in the current capital budget.”

Another non-GRF chunk – $69 million – comes from a Revolving Loan Fund for local infrastructure projects under the PWC that’s part of a total of $444 million in mostly bonds allocated for such work, the OBM director said.

In regards to state agency capital needs addressed in the bill, Mr. Keen said, “The governor’s recommended appropriations are necessary to protect our state infrastructure and maintain the physical facilities in which the citizens of Ohio have already made a significant financial commitment.”

Among the agency allotments is $130 million for the Department of Rehabilitation and Correction, which is experiencing a jump in the prison population despite extensive measures to divert low-level offenders.

“This level of appropriation represents a significant increase from the department’s capital budgets in recent years, but is necessary because prisons constructed 30 years ago are entering a phase that will require more intensive renovations,” Mr. Keen said.

One of the larger agency allocations – $236.4 million – would go to the Department of Natural Resources.

“As you know, Ohio can take pride in having one of the highest rated, most diverse and most heavily visited state park systems in the nation. But this is also a system that’s showing its age, as recreational facilities built in the 1950s and 60s are past due for long-delayed repairs and renovations,” Mr. Keen said. “Appropriations in HB497 take an important step to remedy that situation in our state parks and other ODNR facilities.”

The bill also authorizes two technology projects to be funded with Certificates of Participation, an alternative funding mechanism to GRF-backed bonds under which investors purchase a share of lease revenues of a program rather than bonds being secured by those revenues.

The COP projects in the bill include $45 million for the Department of Administrative Services to implement the Enterprise Data Center Solutions project and $10 million for the state treasurer’s office to replace outdated computers with a new Treasury Management System.

Mr. Keen said the bill contains a few language updates to go along with the appropriations, mainly clean-up provisions related to the dissolution of the Ohio Bonding Authority and the reinstatement of the Transportation Building Fund.

While the administration did not specifically delineate community projects included in the proposed bill, several items requested by eight regional economic development groups and a committee charged with vetting arts projects throughout the state surfaced among the appropriations.

For example, the bill includes a $5 million appropriation for restoration of Cincinnati’s Union Terminal – funding which exceeded the $3.2 million requested.

The legislation also calls for a $2 million appropriation for the Cleveland Museum of Art, which requested $1 million for an expansion, and a $1.1 million appropriation for the Columbus Museum of Art – the full amount requested.

Budget Director Tim Keen presented the first full capital budget in years to lawmakers, saying Gov. John Kasich’s administration now feels the state’s finances are healthy enough to return to supporting local projects. 
The $2.39 billion budget, introduced by Rep. Ron Amstutz (R-Wooster) as HB497, includes funding for K-12 and higher education building projects, the Public Works Commission, state parks and prisons, the Clean Ohio program and community projects. 

The budget director said in testimony to the House Finance and Appropriations Committee that the administration would like to see the bill passed and signed by April 2 so it can go into effect by July 1, preventing an interruption in ongoing projects funded by re-appropriation of previous capital funds also included in the bill.

Keen said the $2.39 billion package is comparable to the last capital budget introduced under normal circumstances. There was no capital budget in 2010, and Kasich sought a scaled-back budget in 2012 based on the state’s financial troubles. Prior to that, capital budgets were inflated by securitization of tobacco settlement payments sought by the Strickland administration, Keen said. 

The biggest chunks of funding in the package include almost $500 million for the Board of Regents and higher education institutions, $675 million for school facilities projects and $444 million for the Ohio Public Works Commission.

Keen said the $236.4 million appropriated for the Ohio Department of Natural Resources is aimed at helping to reduce the significant list of deferred maintenance projects at state parks and forests.

Keen said the budget includes a historically higher amount of money for improvements at state prisons. The $130 million appropriated to the Department of Rehabilitation and Correction is driven by the fact that some decades-old prisons are getting to the point of needing extensive renovations, including roof replacements, new HVAC systems and other upgrades. Youth detention facilities get $36.1 million, which among other projects will pay for new housing units at a Circleville facility, with new housing at other facilities slated for future biennia.

The Ohio Department of Transportation also gets a larger-than-usual allocation of $100 million in HB497, which Keen said reflect the development of a multi-year plan for systemically addressing maintenance facility needs.

Keen said the budget also departs from past practice of not funding technology projects via capital spending on two matters: $45 million for cloud-computing and other statewide IT upgrades at the Department of Administration Services and $10 million to replace the banking system at the state treasurer’s office. The current system is so old that it can’t get security upgrades and could be vulnerable to cyber-attacks, Keen said.

Reps. Denise Driehaus (D-Cincinnati) and Jack Cera (D-Bellaire) brought up local officials’ frustrations with their project requests being deemed ineligible for capital funding. Keen said borrowing authority is limited to specified purposes, and said if he could go back he would have emphasized that point more heavily in giving guidance to local officials. Keen said the fact that this is the first normal capital budget in six years might have contributed to the problem. 

Keen told Rep. Debbie Phillips (D-Athens) that he believes funding in HB497 for improvements at the state fairgrounds and Ohio Expo Center will be sufficient to keep the All-American Quarter Horse Congress returning to Columbus. The Expositions Commission is in line for $49 million in the bill, $38 million of which is for an all-purpose exhibition building and a new animal exhibit building.

Cera noted the increase in prison appropriations, along with a burgeoning inmate population, and asked if the state will need to build more prisons. Keen said the administration would prefer to focus on community corrections, noting part of the Department of Rehabilitation and Correction appropriation is for that purpose.