McDonald Hopkins has been closely following Ohio House Bill 375, legislation that would increase the “severance” tax for oil and gas drillers in Ohio, and specify how the new revenue from the tax is to be used. After weeks of negotiations between the legislature and the Kasich Administration, a substitute version of the bill has been rolled out for public consideration. The new bill increases the severance tax to 2.25%, allocates 90% of the revenue it generates to a reduction in the state income tax, and directs the other 10% back to local governments located in the shale play (currently 24-26 counties). Negotiations continue both on the overall policy goals of the legislation and the details needed to accomplish those goals. The House Ways and Means Committee has scheduled a hearing for Wednesday, February 26th where additional public testimony will be taken and further changes are expected to the bill. Stay tuned for up to the minute updates on this major piece of legislation which could potentially affect every Ohioan.