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Changes on the way for governor’s tax plan

Prior to breaking for summer recess, House Finance Chairman Ron Amstutz announced there would be major changes to Governor John Kasich’s tax proposal included in the biennial budget bill. Amstutz said changes to the severance tax are not likely to be included in the House substitute bill, which is expected to be adopted the week of April 8.

Under the initial proposal, the severance tax would be raised from the current 20 cents per barrel to 4 percent for horizontal wells producing oil, natural gas liquids and condensate following the first year of production—the rate would be 1.5 percent the first year to allow producers to recover the cost of preparing the well site and drilling the well. Tax rates would be 1 percent for horizontal wells producing natural gas.

Additionally, Amstutz said substantial changes would be made to the governor’s proposal to expand the state sales tax to cover services, such as accounting and advertising fees. He said the House is committed to one aspect of the governor’s plan— to lower the state income tax. Discussions in the caucus continue on how to fund a tax cut without expanding the sales tax base or increasing severance taxes.

House Speaker Bill Batchelder (R- Medina) and Senate President Keith Faber (R- Celina) released a joint statement asking for outside expertise and participation from the business community on tax reform. Stating the goal of majority leadership is to achieve lower income taxes and simplify the tax code, the leaders asked those interested in providing feedback to do so expeditiously.

Hearings continue for workforce development loan fund

The Senate Workforce and Economic Development Committee continued hearings this week on Senate Bill 1, legislation to create the OhioMeansJobs Workforce Development Revolving Loan Fund. The program would award funds to specified educational institutions that would in turn award loans to participants in workforce training programs. The bill appropriates $25 million from casino licensing fees for the program.

Senators Bill Beagle (R- Tipp City) and Troy Balderson (R- Zanesville) said although a fair number of training programs are currently available in the state, most are federally funded and have restrictions. The goal is for these dollars to flow to in-demand jobs rather than earmarking the funds for specific industries.

Under the bill, the Development Services Agency would be responsible for awarding funds to qualifying institutions. Students would apply for loans of up to $10,000 through the institution to finance the cost of a training program. The bill requires preference be given to schools that partner with businesses that commit to paying back all or part of the students' loans, or who have provided funding to establish and operate the training program itself.

“As a business organization, we are in support of programs that are focused on quality, success and businesses having some skin in the game,” said Dan Navin in written testimony on behalf of the Ohio Chamber of Commerce.

The following institutions would qualify for participation: state institutions of higher education, private career schools, private for profit institutions, private universities, career-technical centers, and joint vocational school districts.

Legislation introduced this week

Investing in precious metals: Sponsored by Senator Kris Jordan (R- Delaware), Senate Bill 58 would require the Treasurer of State, and each county investing authority, to invest at least 5 percent of the state's total average investment portfolio of interim funds, and in each county's total average investment portfolio of inactive moneys, respectively, in precious metals by June 30th of each year.

Fair pay: Sponsored by Senators Nina Turner (D- Cleveland) and Charleta Tavares (D- Columbus), Senate Bill 92 would enact the "Fair and Acceptable Income Required  Act" (FAIR) and revise the enforcement of the prohibitions against discrimination in the payment of wages.

Internship tax credits: Sponsored by Representative Nan Baker (R- Westlake), House Bill 107 authorizes a tax credit for businesses that employ high school students in career exploration internships.

Ban drilling on Lake Erie: Sponsored by Senator Michael Skindell (D- Lakewood), Senate Bill 87 would ban the taking or removal of oil or natural gas from and under the bed of Lake Erie.

For more information, please contact:

Michael Caputo

(non-attorney professional)


Rebecca M. Kuhns

(non-attorney professional)


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