Sec. 5121.04.  (A) The department of mental health and thedepartment of mental retardation and developmental disabilitiesshall investigate the financial condition of the patients inhospitals and residents in institutions, residentswhose care ortreatment is being paid for in a private facility or home underthe control of the department of mental retardation anddevelopmental disabilities, and of the relatives named in section5121.06 of the Revised Code as liable for the support of suchpatients or residents, in order to determine the ability of anypatient, resident, or such liable relatives to pay for the support ofthepatient or resident and to provide suitable clothing asrequiredby the superintendent of the institution.

The department of mental health shall investigate thefinancialcondition of patients receiving state-operated communitymental healthservices and of the liable relatives to determinethe patient's orrelative's ability to pay for the patient's support. In all cases,in determining ability to pay and theamount to be charged, dueregard shall be had for others who maybe dependent for supportupon such relatives or the estate of thepatient.

(B) The department shall follow the provisions of thisdivision in determining the ability to pay of a patient orresident or the patient's or resident's liable relatives andtheamount to be chargedsuch patient or resident or liable relatives.

(1) Subject to divisions (B)(10) and(11) of this section, apatientor resident without dependents shall be liable for thefull applicablecost. A patient or resident without dependentswho has agross annual income equal to or exceeding the sum of thefull applicablecost, plus fifty dollars per month, regardless ofthe source ofsuch income, shall pay currently the full amount ofthe applicable cost;if the patient's or resident's gross annualincome is less than such sum,not more than fifty dollars permonth shall be kept for personaluse by or on behalf of thepatient or resident, except aspermitted in the state plan forproviding medical assistanceunder Title XIX of the"SocialSecurity Act," 49 Stat. 620(1935), 42 U.S.C. 301, as amended, andthe balance shall be paidcurrently on the patient's or resident's support. Subjectto divisions (B)(10) and (11) of thissection,the estate of a patient or resident without dependentsshall paycurrently any remaining difference between the applicable costandthe amounts prescribed in this section,or shallexecute anagreement with the department for payment to be madeat somefuture date under terms suitable to the department. However, nosecurity interest, mortgage, or lien shall be taken,granted, orcharged against any principal residence of a patientor resident without dependents under an agreement or otherwise tosecuresupport payments, and no foreclosure actions shall betaken onsecurity interests, mortgages, or liens taken, granted,or chargedagainst principal residences of patients or residents prior toOctober 7, 1977.

(2) The ability to pay of a patient or resident withdependents, or of a liable relative of a patient or resident either with or without dependents, shall be determined inaccordance with the patient's, resident's, or liablerelative'sincome or other assets, the needs of otherswho are dependent onsuch income and other assets for support,and, if applicable,divisions (B)(10) and(11) of this section.

For the first thirty days of care and treatment of eachadmission and for the first thirty days of care and treatment fromstate-operated community mental health services, but in no eventfor morethan thirty days in anycalendar year, the mentally illpatient or mentally retardedresident with dependents or theliable relative of a mentally illpatient or a mentally retardedresident either with or withoutdependents shall be charged anamount equal to the percentage ofthe average applicable costdetermined in accordancewith theschedule of adjusted grossannual income contained after thisparagraph. After such firstthirty days of care and treatment,such mentally ill patient ormentally retarded resident or suchliable relative shall becharged an amount equal to thepercentage of a base support rateof four dollars per day formentally ill patients and mentallyretarded residents, asdetermined in accordance with the scheduleof gross annual incomecontained after this paragraph, or inaccordance with division(B)(5) of this section. BeginningJanuary 1, 1978, thedepartment shall increase the base rate whenthe consumer priceindex average is more than 4.0 for thepreceding calendar year bynot more than the average for suchcalendar year.

Footnote a. The patient or resident or relative shallfurnish a copy of the patient's, resident's, or relative'sfederalincome tax return as evidence ofgross annualincome.

Footnote b. The number of dependents includes the liablerelative but excludes the patient or a resident in the hospital oran institution."Dependent" includes any person who receives morethan half the person's support from the patient resident orthe patient'sresident's liable relative.

(3) A patient or resident or liable relative havingmedical,funeral, or related expenses in excess of four per centof theadjusted gross annual income, which expenses were notcovered byinsurance, may adjust such gross annual income byreducing theadjusted gross annual income by the full amount ofsuch expenses.Proof of such expenses satisfactory to thedepartment must befurnished.

(4) Additional dependencies may be claimed if:

(a) The liable relative is blind;

(b) The liable relative is over sixty-five;

(c) A child is a college student with expenses in excessoffifty dollars per month;

(d) The services of a housekeeper, costing in excess offifty dollars per month, are required if the person who normallykeeps house for minor children is the patient or resident.

(5) If with respect to any patient or resident withdependents there is chargeable under division (B)(2) of thissection less than fifty per cent of the applicablecost or, if thebase support rate was used, less than fifty per cent of theamountdetermined by use of the base support rate, and if withrespect tosuch patient or resident there is a liable relativewho has anestate having a value in excess of fifteen thousanddollars or ifsuch patient or resident has a dependent and anestate having avalue in excess of fifteen thousand dollars,there shall be paidwith respect to such patient or resident atotal of fifty per centof the applicable cost or thebase support rate amount, as thecase may be, on a current basis orthere shall be executed withrespect to such patient or resident an agreement with thedepartment for payment to be made at somefuture date under termssuitable to the department.

(6) When a person has been a patient or resident forfifteenyears and the support charges for which a relative isliable havebeen paid for the fifteen-year period, the liablerelative shallbe relieved of any further support charges.

(7) The department shall accept voluntary payments frompatients or residents or liable relatives whose incomes are belowthe minimum shown in the schedule set forth in this division. Thedepartment also shall accept voluntary payments in excess ofrequired amounts from both liable and nonliable relatives.

(8) If a patient or resident is covered by an insurancepolicy, or other contract that provides for payment of expensesfor care and treatment for mental illness or mental retardation or other developmental disabilityator from an institution, or facility(including a hospital orcommunityservice unit under the jurisdiction of the department),orstate-operated community mental health service, the otherprovisions of this section, except divisions (B)(8),(10), and(11) of this section, and of section 5121.035121.01 of the Revised Codeshall besuspended to the extent that such insurance policy orothercontract is in force, and such patient or resident shall becharged the full amount of the applicable cost. Any insurancecarrieror other third party payor providing coverage for suchcare andtreatment shall pay for this support obligation in anamountequal to the lesser of either the applicable cost or thebenefitsprovided under the policy or other contract. Whether ornot an insured, ownerof, or other person having an interest insuch policy or othercontract is liable for support payments underother provisions ofthis chapter, the insured, policy owner, orother personshall assign payment directly to the departmentofall assignable benefits under the policy or other contract andshall pay over to the department, within ten days of receipt, allinsurance or other benefits received asreimbursement orpaymentfor expenses incurred by the patient or resident or forany otherreason. If the insured, policy owner, or otherperson refuses toassign such payment to thedepartment or refuses to pay suchreceived reimbursements orpayments over to the department withinten days of receipt, theinsured's, policy owners', or otherperson'stotal liability for the services equals the applicablestatutory liabilityfor payment for the services as determinedunder other provisionsof this chapter, plus the amounts payableunder the terms of thepolicy or other contract. In no eventshall this total liabilityexceed the full amount of theapplicable cost. Upon its request, thedepartment isentitled toa court order that compels the insured, owner of, orother personhaving an interest in the policy or other contractto comply withthe assignment requirements of this division orthat itself servesas a legally sufficient assignment incompliance with suchrequirements. Notwithstanding section5122.31 5123.89 of the Revised Codeand any other law relating toconfidentiality of records, themanaging officer of theinstitution or facility where a person isor has been a patientor resident, or the managing officer of thestate-operated communitymental health services from which thepatient receives services,shall disclose pertinent medicalinformationconcerning the patient or resident to the insurancecarrier orother third party payor in question, in order to effectcollection from the carrier or payor of the state's claim forcareand treatment under this division. For such disclosure, themanaging officer is not subject to any civil or criminalliability.

(9) The rate to be charged for pre-admission care,after-care, day-care, or routine consultation and treatmentservices shall be based upon the ability of the patient orresident or the patient's or resident's liable relatives topay.When it is determinedby the department that a charge shall bemade, such charge shallbe computed as provided in divisions(B)(1) and (2) of thissection.

(10) If a patient or resident with or without dependentsisthe beneficiary of a trust created pursuant to section 1339.51ofthe Revised Code, then, notwithstanding any contrary provisionofthis chapter or of a rule adopted pursuant to this chapter,divisions (C) and (D) of that section shall apply in determiningthe assets or resources of the patient or resident, thepatient'sor resident's estate,the settlor,or thesettlor'sestate and toclaimsarising under this chapteragainst thepatient or resident, thepatient's or resident's estate,thesettlor, or thesettlor'sestate.

(11) If the department of mental retardation anddevelopmentaldisabilities waives the liability of an individualand the individual's liablerelatives pursuant to section 5123.194of the Revised Code, theliability of the individualand relativeceases in accordance with the waiver's terms.

(C) The department may enter into agreements with apatientor resident or a liable relative for support payments tobe madein the future. However, no security interest, mortgage,or lienshall be taken, granted, or charged against any principalfamilyresidence of a patient or resident with dependents or aliablerelative under an agreement or otherwise to secure supportpayments, and no foreclosure actions shall be taken on securityinterests, mortgages or liens taken, granted, or charged againstprincipal residences of patients or residents or liable relativesprior to October 7, 1977.

(D) The department shall make all investigations anddeterminations required by this section within ninety days afterapatient or resident is admitted to an institution under thedepartment's control or a patient begins to receive state-operatedcommunity mental health services, and immediately shall notify bymail thepersons liable of the amount to be charged.

(E) All actions to enforce the collection of paymentsagreedupon or charged by the department shall be commencedwithin sixyears after the date of default of an agreement to paysupportcharges or the date such payment becomes delinquent. Ifa paymentis made pursuant to an agreement which is in default, anewsix-year period for actions to enforce the collection ofpaymentsunder such agreement shall be computed from the date ofsuchpayment. For purposes of this division an agreement is indefaultor a payment is delinquent if a payment is not madewithin thirtydays after it is incurred or a payment, pursuant toan agreement,is not made within thirty days after the datespecified for suchpayment. In all actions to enforce thecollection of payment forthe liability for support, every courtof record shall receiveinto evidence the proof of claim made bythe state together withall debts and credits, and it shall beprima-facie evidence of thefacts contained in it.

Sec. 5121.05.  The department of mental health and the department of mentalretardation and developmental disabilities may subpoena witnesses, taketestimony under oath, and examine any public records relating to the incomeandother assets of a patient or resident or of a relative liable for suchpatient's or resident's support relative. All information, conclusions, andrecommendations shall be submitted to the department by the investigatingagentof the department. The department shall determine the amount of support to bepaid, by whom, and whether clothing shall be furnished by the relatives orguardian.

Sec. 5121.06.  (A) The following persons other than thepatient or resident or the patient's or resident's estateare liable relatives and allthe following persons are jointly and severally liable for thesupport of a patient or resident in a hospital or an institutionunder the control of the department of mental health or thedepartment of mental retardation and developmental disabilities or for thesupport of a patient receiving state-operated community mental healthservices:

(1) The patient or resident or the patient's or resident's estate;

(2) The patient's or resident's spouse;

(3) The father or mother, or both, of a minor patient orresident under the age of eighteen years.

(B) The department shall determine, pursuant to section5121.04 of the Revised Code, the amount to be charged each such resident andliable person relative in the order named in this section, but shall notcollect from any person more than one hundred per cent of theapplicable cost.

(C) An action to collect delinquent payments or to enforceagreements in default may be brought against any or all personsnamed in this section. To the extent parents of adult patientsor residents, pursuant to the language of this section previouslyin force, incurred charges for the support of such patients orresidents between the eighteenth birthday of such patient orresident and July 1, 1975, their liability for such period may becancelled, compromised, or settled as provided in section 5121.07of the Revised Code.

(D) Irrespective of the number of patients or residents whose care might be chargeable against a liable relative, noindividual liable relative nor any group of liable relatives whoare members of the same family unit shall be charged with thesupport of more than one patient or resident during the sameperiod of time, and different periods of time for which suchliable relative has paid the charges for such different patients'or residents' care and support shall be added together for thepurpose of completing the maximum fifteen-year period ofliability of such liable relative under division (B)(6) ofsection 5121.04 of the Revised Code.

Sec. 5121.061.  The authority of the department of mental health or thedepartment of mental retardation and developmental disabilities to modifysupport charges pursuant to section 5121.04 of the Revised Code shall not beexercised until the patient or resident or liable relative has petitioned thedepartment for modification as provided in section 5121.07 of the Revised Codeand has offered to the department satisfactory proof of his the resident's or liable relative's earnings andassets. The department may modify the charges if its investigation warrantssuch modification.

Sec. 5121.07.  Any person who has been charged with the payment of the supportof a patient or resident of any benevolent institution; or for pre-admissioncare, after-care, day-care, or routine consultation and treatment services ina community service unit under the control of the department of mental healthor the department of mental retardation and developmental disabilities;or for the cost of state-operated community mental health services maypetition the department for a release from, or modification of, such charge,and the department, after an investigation, may cancel or modify such formercharge, or may cancel, compromise, or settle any accrued liability in anamount not exceeding five thousand dollars. Amounts in excess thereof may becanceled, compromised, or settled as provided in section 131.02 of the RevisedCode. The department may for due cause increase the amount previously orderedpaid.

Sec. 5121.08.  The managing officers of the benevolent institutions under thecontrol of the department of mental health and the department of mentalretardation and developmental disabilities, the managing officers ofstate-operated community mental health services, and the committingcourt, ifrequested, shall submit to the department such information as they may obtainconcerning the financial condition of any patient or resident or of relativesliable for the patient's or resident's support.

Sec. 5121.09.  In case the estate of any patient or resident in abenevolent aninstitution under the jurisdiction of the department of mental health or thedepartment of mental retardation and developmental disabilities orreceiving state-operated community mental health services is sufficientfor the patient's or resident's support, without hardship toany others who may be dependent thereon,and no guardian has been appointed for such estate, the agent of thedepartmentshall petition the probate court of the proper county to appoint a guardian.

Sec. 5121.10.  Upon the death of a person who is a patientor resident, or has been a patient or former resident, of any benevolentinstitution under the jurisdiction of the department of mentalhealth or the department of mental retardation and developmentaldisabilities or state-operated community mental health services, orupon the death of a person responsible undersection 5121.06 of the Revised Code for the support of a patientor resident, the department may waive the presentation of anyclaim for support against the estate of such decedent, when inits judgment an otherwise dependent person will be directlybenefited by the estate. Claims against an estate for support ofa patient or resident are subject to section 1339.51 and Chapter2117. of the Revised Code, and shall be treated, and may bebarred, the same as the claims of other creditors of the estate,pursuant to that section or chapter.

The department may accept from a guardian or trustee of apatient or resident a contract agreeing to pay to the state fromthe property of the guardian's or trustee's ward before orat the death of the ward afixed annual amount for the support of the ward while theward is apatient or resident, with interest at four per cent per annum. Acopy of the contract shall be filed in the probate court of theproper county and duly entered as a part of the recordsconcerning the ward.

Sec. 5121.11.  The state shall bear the expense of the burial orcremation of an indigentpatient or resident who dies in a state hospital for the mentally ill, orinstitution for the mentally retarded, operated by the department of mental retardation and developmental disabilities under section 5123.03 of the Revised Code or in a state correctional institution,if the body is not claimed for interment or cremation at the expense offriends orrelatives, or is not delivered for anatomical purposes or for the study ofembalming in accordance with section 1713.34 of the Revised Code. Themanaging officer of the institution shall provide at the grave of the personor, if the person's cremated remains are buried, at the grave of theperson's cremated remains, ametal, stone, or concrete marker on which shall be inscribed the name and ageof the person and the date of death.

Sec. 5121.12.  The support and maintenance of patients confined in statehospitals for the mentally ill or of residents confined in state institutionsfor the mentally retarded operated by the department of mental retardation and developmental disabilities under section 5123.03 of the Revised Code, including those transferred to them from statecorrectional institutions, and also including persons under indictment orconviction for crime, shall be collected and paid in accordance with thischapter sections 5121.01 to 5121.21 of the Revised Code.

Sec. 5121.21.  (A) If payment of any amount due the stateunder the provisions of Chapter 5121. of the Revised Code is madeon account of a patient or resident by any liable relative, asdefined in division (A) of section 5121.06 of the Revised Code,such relative may recover the following amounts from thefollowing persons; provided, that in no event may such relativerecover in total more than such relative has paid the state, andprovided, that in no event is the person from whom recovery issought obliged to pay at a rate of support higher than suchperson would have paid had the state proceeded directly againstsuch person:

(1)(A) Any liable person may recover from the patient orresident, his the resident's guardian, or from theexecutor or administrator ofthe patient's or resident's estate, the full amount of paymentmade by such liable relative.

(2)(B) Any liable relative may recover from the patient's orresident's husband or wife, spouse the full amount of paymentmade bysuch liable relative.

(3)(C) A minor patient's or resident's mother may recoverfrom such minor patient's or resident's father the full one-half of the amount ofpayment made by such mother.

(4)(D) Any liable relative, other than the patient's orresident's spouse and other than a minor patient's or resident'sparent, may recover from such of a patient's or resident's adultsons and daughters as are liable under division (A)(4)of section5121.06 of the Revised Code, the full amount of payment made bysuch liable relative; provided, that there may be recovered fromeach such son or daughter only such proportion ofthe totalpayment as the figure one bears to the total number of such adultsons and daughters.

(5)(E) An adult patient's or resident's mother may recoverfrom an adult patient's or resident's father the full one-half of the amount ofpayment made by such mother.

Sec. 5121.30. As used in sections 5121.30 to 5121.56 of the Revised Code:

(A) "Community mental health services client" or "client" means a person receiving state-operated community mental health services.

(B) "Countable assets" means all of the following:

(1) Cash;

(2) Bank deposits;

(3) Securities;

(4) Individual retirement accounts;

(5) Qualified employer plans, including 401(k) and Keogh plans;

(6) Annuities;

(7) Funds in a trust created under section 1339.51 of the Revised Code;

(8) Investment property and income;

(9) The cash surrender values of life insurance policies;

(10) Assets acquired by gift, bequest, devise, or inheritance;

(11) Any other asset determined by the department of mental health to be equivalent to the assets enumerated in this division.

(C) "Federal poverty level" or "FPL" means the income level represented by the poverty guidelines as revised annually by the United States department of health and human services in accordance with section 673(2) of the "Omnibus Reconciliation Act of 1981," 95 Stat. 511, 42 U.S.C. 9902, as amended, for a family size equal to the size of the family of the person whose income is being determined.

(D) "Federal poverty guidelines" means the poverty guidelines as revised annually by the United States department of health and human services in accordance with section 673(2) of the "Omnibus Budget Reconciliation Act of 1981," 95 Stat. 511, 42 U.S.C. 9902, as amended, for a family size equal to the size of the family of the person whose income is being determined.

(E) "Hospital" means an institution, hospital, or other place established, controlled, or supervised by the department of mental health under Chapter 5119. of the Revised Code.

(F) "Liable relative" means all of the following:

(1) A patient's spouse;

(2) A patient's mother or father, or both, if the patient is under eighteen years of age;

(3) A patient's guardian.

(G) "Patient" means a person admitted to a hospital for inpatient care or treatment, including a person transferred to a hospital from a state correctional institution or a person under indictment or conviction who has been transferred to a hospital.

Sec. 5121.31. All patients shall be maintained at the expense of the state. The traveling and incidental expenses in conveying them to a hospital shall be paid by the county of commitment. On admission, patients shall be neatly and comfortably clothed. Thereafter, the expense of necessary clothing shall be borne by the responsible relatives or guardian if they are financially able. If not furnished, the state shall bear the expense. Any required traveling expense after admission to the hospital shall be borne by the state if the responsible relatives or guardian is unable to do so.

Sec. 5121.32.  On an annual basis, the department of mental health shall determine both of the following using generally accepted governmental accounting principles:

(A) The applicable per diem charge for each hospital operated by the department;

(B) The ancillary per diem rate for each hospital operated by the department.

In determining a hospital's applicable per diem charge and ancillary per diem rate, the department shall consider the average actual per diem cost of maintaining and treating a patient at the hospital or, at the department's discretion, the average actual per diem cost of maintaining and treating a patient in a unit of the hospital.

Sec. 5121.33.  Except as provided in sections 5121.35, 5121.43, 5121.46, 5121.47, 5121.49, and 5121.52 of the Revised Code, the department of mental health shall, for each billing cycle, charge a patient, patient's estate, or liable relative an amount equal to the sum of the following:

(A) The applicable per diem charge multiplied by the number of days the patient was admitted to the hospital;

(B) An amount that was previously billed but not paid.

Sec. 5121.34.  (A) A patient, patient's estate, and patient's liable relatives shall be jointly and severally liable for amounts charged by the department of mental health in accordance with section 5121.33 or 5121.35 of the Revised Code. In no case shall any of the foregoing persons be liable for more than one hundred per cent of the full sum charged under section 5121.33 of the Revised Code.

(B) Collections of support payments shall be made by the department and, subject to meeting prior requirements for payment and crediting of such collections and other available receipts, in accordance with the bond proceedings applicable to obligations issued pursuant to section 154.20 of the Revised Code. The collections and other available receipts designated by the director of mental health for deposit in the special accounts, together with insurance contract payments provided for in section 5121.43 of the Revised Code, shall be remitted to the treasurer of state for deposit in the state treasury to the credit of the mental health operating fund, which is hereby created, to be used for the general purposes of the department. The department shall make refunds of overpayment of support charges from the mental health operating fund.

Sec. 5121.35.  The department of mental health shall charge a patient, patient's estate, or liable relative an amount discounted from the amount the department charges under section 5121.33 of the Revised Code if the department determines through the application process described in section 5121.36 of the Revised Code or through the financial assessment process described in section 5121.37 of the Revised Code that the patient, estate, or relative is eligible for a discount.

Sec. 5121.36. (A) A patient, patient's estate, or liable relative may apply for a discount by completing an application form prescribed by the director of mental health. The department of mental health may require a patient, estate, or relative to furnish any of the following with an application form:

(1) A copy of the patient's, estate's, or liable relative's federal income tax return for the year preceding the date of application or, if that is not yet available, the preceding year;

(2) A copy of the patient's, estate's, or liable relative's employee tax withholding return (form W-2) for the year preceding the date of application;

(3) Any other relevant documents prescribed by the director of mental health.

(B) To be considered, an application must be submitted to the department not later than ninety days after the date the patient is admitted to a hospital.

(C) From the information provided by a patient, estate, or relative, the department shall determine whether the department will charge the person a discounted amount in accordance with sections 5121.40 and 5121.41 of the Revised Code. In making this determination, the department shall consider whether the patient is covered by an insurance policy or other contract that provides for payment of expenses and treatment for mental illness. If the department determines that the patient has coverage, the department shall require payment in accordance with section 5121.43 of the Revised Code.

(D) The department shall notify the patient, executor or administrator of the patient's estate, or liable relative who submitted the application form in writing regarding whether that person will be charged a discounted amount and the per diem rate to be charged.

(E) In accordance with section 5121.42 of the Revised Code, the department may, at any time, modify an amount charged or change the per diem rate to be charged if the department learns of countable assets or income that was not previously disclosed or was acquired after the application form was submitted. Within a reasonable time, the department shall notify in writing any person affected by a modification or change.

Sec. 5121.37. After a patient's admittance to a hospital, the department of mental health shall conduct a financial assessment to determine whether the patient, patient's estate, or liable relative will be charged an amount discounted from the amount the department charges under section 5121.33 of the Revised Code. The department shall make the determination in accordance with sections 5121.40 and 5121.41 of the Revised Code.

If a discounted rate is to be charged, the department shall notify the person whose financial condition was assessed. The notice shall specify the per diem rate to be charged.

In accordance with section 5121.42 of the Revised Code, the department may, at any time, modify an amount charged or change the per diem rate to be charged if the department learns of countable assets or income that was not previously disclosed or was acquired after the assessment was conducted. Within a reasonable time, the department shall notify in writing any person affected by a modification or change.

Sec. 5121.38.  The department of mental health may subpoena witnesses, taketestimony under oath, and examine any public records relating to the incomeandother assets of a patient or of a relative liable for suchpatient's support. All information, conclusions, andrecommendations shall be submitted to the department by the investigatingagentof the department.

Sec. 5121.40. (A) A patient, patient's estate, or liable relative may be eligible to be charged an amount discounted from the amount the department of mental health charges under section 5121.33 of the Revised Code if the patient, estate, or relative has countable assets with a total value that is not greater than an amount equal to fifty per cent of the difference between the following:

(1) The gross annual income that corresponds with a family size of two persons at one hundred per cent of the federal poverty level for the state;

(2) The gross annual income that corresponds with a family size of one person at one hundred per cent of the federal poverty level for the state. For purposes of determining family size, the patient is one dependent. One additional dependent shall be included for each of the following circumstances and persons:

(a) The patient or liable relative is legally blind or deaf.

(b) The patient or liable relative is of sixty-five years of age or older.

(c) Each child under eighteen years of age for which the patient or liable relative has legal custody;

(d) The patient's or liable relative's spouse.

(B) A patient, estate, or relative may, not later than ninety days after the patient's admission to a hospital, surrender the value of countable assets sufficient to reduce countable assets to not more than the limit described in division (A) of this section.

Sec. 5121.41.  (A) If the assets of a patient, patient's estate, or liable relative do not exceed the countable asset limit in section 5121.40 of the Revised Code and the annual income of the patient, estate, or relative does not exceed four hundred per cent of the federal poverty level, the patient, estate, or relative shall be charged an amount discounted from the amount the department charges under section 5121.33 of the Revised Code for the first thirty days the patient is admitted as an inpatient in a hospital and for which the patient is liable for the cost of care. The amount of the discount shall be computed according to the following schedule:

(B) A patient, estate, or relative who is charged a discounted amount for the first thirty days the patient is admitted as an inpatient and who has an annual income not greater than one hundred seventy-five per cent of the federal poverty level shall not be charged for the days the patient is admitted beyond the thirtieth day.

(C) A patient, estate, or relative who is charged a discounted amount for the first thirty days the patient is admitted as an inpatient and who has an annual income greater than one hundred seventy-five per cent of the federal poverty level shall be charged an amount equal to the sum of the following for the days the patient is admitted beyond the thirtieth day:

(1) The ancillary per diem rate multiplied by the number of days the patient was admitted to the hospital;

(2) An amount that was previously charged but not paid.

Sec. 5121.42. (A) Except as provided in division (B) of this section, a patient, patient's estate, or liable relative shall cease to be eligible for a discount under sections 5121.36 or 5121.37 of the Revised Code on accumulation of countable assets in excess of an amount equal to fifty per cent of the difference between the following:

(1) The gross annual income that corresponds with a family size of two persons at one hundred per cent of the federal poverty level for the state;

(2) The gross annual income that corresponds with a family size of one person at one hundred per cent of the federal poverty level for the state.

(B) Money needed to meet the patient's needs and burial fund as determined by a needs assessment conducted by the department of mental health pursuant to rules adopted under section 5119.01 of the Revised Code shall be excluded from any determination the department makes under division (A) of this section.

Sec. 5121.43. If a patient is covered by an insurance policy or other contract that provides for payment of expenses for care and treatment for mental illness at or from a hospital under the jurisdiction of the department of mental health, sections 5121.33 to 5121.55 of the Revised Code are inapplicable to the extent that the policy or contract is in force. Any insurance carrier or other third party payor providing coverage for such care and treatment shall pay for the patient's support obligation in amounts equal to the lesser of amounts charged by the department under section 5121.33 of the Revised Code or the benefits provided under the policy or other contract. Whether or not an insured, owner of, or other person having an interest in such policy or other contract is liable for support payments, the insured, policy owner, or other person shall assign payment directly to the department of all assignable benefits under the policy or other contract and shall pay to the department, within ten days of receipt, all insurance or other benefits received as reimbursement or payment for expenses incurred by the patient or for any other reason. If the insured, policy owner, or other person refuses to assign payment to the department or refuses to pay received reimbursements or payments to the department within ten days of receipt, the total liability of the insured, policy owner, or other person for the services is an amount equal to the per diem charge for the hospital where the patient was admitted multiplied by the number of days the patient was admitted.

In no event shall this total liability exceed the department's actual cost of providing care and treatment to a patient. The department may disqualify patients and liable relatives who have retained third party funds from future discounts. The department may request that the attorney general petition a court of competent jurisdiction to compel the insured, owner of, or other person having an interest in the policy or contract to comply with the assignment requirements in this section.

Sec. 5121.44. The department of mental health may enter into an extended payment agreement with a patient, patient's estate, or liable relative who has notified the department that the patient, estate, or relative cannot reasonably pay an amount the department has charged. In no case shall the department take a security interest, mortgage, or lien against the principal family residence of a patient or liable relative.

Sec. 5121.45. (A) For purposes of this section, "delinquent payment" means an amount owed by a patient, patient's estate, or liable relative to the department of mental health for which the person has failed to do either of the following not later than ninety days after the service associated with the charge was incurred:

(1) Make payment in full;

(2) Make a payment in accordance with the terms of an agreement entered into under section 5121.44 of the Revised Code.

(B) An action to enforce the collection of a delinquent payment shall be commenced not later than six years after the later of the following:

(1) The last date the department received money to satisfy the delinquent payment;

(2) The date the charge was due.

(C) In all actions to enforce the collection of delinquent payments, a court of record shall receive into evidence the proof of claim document made by the state together with all debts and credits. The proof of claim document shall be prima-facie evidence of the facts stated in the document.

Sec. 5121.46. The department of mental health shall not charge a liable relative under sections 5121.33 and 5121.35 of the Revised Code who has done either of the following:

(A) Paid all amounts charged by the department for the care and treatment of a particular patient for fifteen consecutive years;

(B) Paid amounts charged by the department for the care and treatment of more than one patient for a total of fifteen consecutive years.

Sec. 5121.47. Irrespective of the number of patients for which the department of mental health may charge a liable relative under sections 5121.33 or 5121.35 of the Revised Code, the department shall not charge a liable relative or group of liable relatives who are members of the same family unit for the support of more than one patient during the same period of time.

Sec. 5121.48. The department shall accept voluntary payments from a patient, patient's estate, or liable relative in excess of a discounted amount charged in accordance with section 5121.35 of the Revised Code.

Sec. 5121.49. (A) Any person who has been charged under section 5121.33 or 5121.35 of the Revised Code may petition the department of mental health to do the following:

(1) Release the person from a charge;

(2) Modify or cancel a charge.

(B) The department shall respond to a petition in writing and inform the petitioner of whether a release, modification, or cancellation has been approved.

Sec. 5121.50. When a patient is committed to a hospital pursuant to judicial proceedings, the judge ordering the commitment shall:

(A) Make a reliable report on the financial condition of the patient and of each liable relative, as provided in rules adopted by the director of mental health;

(B) Certify the report required under division (A) of this section to the managing officer of the hospital. The managing officer shall thereupon enter in the managing officer's records the name and address of any guardian appointed and of any relative liable for the patient's support.

Sec. 5121.51.  In case the estate of any patient in ahospital is sufficientfor the patient's supportand no guardian has been appointed for such estate, the agent of thedepartmentof mental health shall petition the probate court of the proper county to appoint a guardian.

Sec. 5121.52.  On the death of a person who is a patient, or has been a patient in a hospital, oron the death of a person responsible undersection 5121.34 of the Revised Code for the support of a patient, the department of mental health may waive the presentation of anyclaim for support against the estate of such decedent, when inits judgment an otherwise dependent person will be directlybenefited by the estate. Claims against an estate for support ofa patient are subject to section 1339.51 and Chapter2117. of the Revised Code, and shall be treated, and may bebarred, the same as the claims of other creditors of the estate,pursuant to that section or chapter.

The department of mental health may accept from a guardian or trustee of apatient a contract agreeing to pay to the state fromthe property of the guardian's or trustee's ward before orat the death of the ward afixed annual amount for the support of the ward while theward is apatient, with interest at four per cent per annum. Acopy of the contract shall be filed in the probate court of theproper county and duly entered as a part of the recordsconcerning the ward.

Sec. 5121.53.  The state shall bear the expense of the burial orcremation of an indigentpatient who dies in a hospital if the body is not claimed for interment or cremation at the expense offriends orrelatives, or is not delivered for anatomical purposes or for the study ofembalming in accordance with section 1713.34 of the Revised Code. Themanaging officer of the hospital shall provide at the grave of the patientor, if the patient's cremated remains are buried, at the grave of thepatient's cremated remains, ametal, stone, or concrete marker on which shall be inscribed the name and ageof the patient and the date of death.

Sec. 5121.54.  If payment of any amount due the stateunder the provisions of this chapter is madeon account of a patient by any liable relative, asdefined in section 5121.30 of the Revised Code,the relative may recover from the patient, the patient's guardian, or the executor or administrator of the patient's estate, the full amount of payment made by the liable relative; provided, that in no event may a relativerecover in total more than the relative has paid the state, andprovided, that in no event is the person from whom recovery issought obliged to pay at a rate of support higher than theperson would have paid had the state proceeded directly againstthat person.

Sec. 5121.55. The cost for support of a client of state-operated community mental health services is an amount determined using guidelines the department of mental health shall issue. The guidelines shall be based on cost findings and rate-settings applicable to such services.

Sec. 5121.56. The support and maintenance of patients confined in state hospitals for the mentally ill, including persons transferred to them from state correctional institutions, and also including persons under indictment or conviction for crime, shall be collected and paid in accordance with sections 5121.30 to 5121.55 of the Revised Code.

Sec. 5122.03.  A patient admitted under section 5122.02 ofthe Revised Code who requests his release in writing, or whoserelease is requested in writing by his the patient's counsel,legal guardian, parent, spouse, or adult next of kin shall be releasedforthwith,except that when:

(A) The patient was admitted on his the patient's ownapplicationandthe request for release is made by a person other than thepatient, release may be conditional upon the agreement of thepatient; or

(B) The chief clinical officer of the hospital, withinthree court days from the receipt of the request for release,files or causes to be filed with the court of the county wherethe patient is hospitalized or of the county where the patient isa resident, an affidavit under section 5122.11 of the RevisedCode. Release may be postponed until the hearing held undersection 5122.141 of the Revised Code. A telephone communicationwithin three court days from the receipt of the request forrelease from the chief clinical officer to the court, indicatingthat the required affidavit has been mailed, is sufficientcompliance with the time limit for filing such affidavit.

Unless the patient is released within three days from thereceipt of the request by the chief clinical officer, the requestshall serve as a request for an initial hearing under section5122.141 of the Revised Code. If the court finds that thepatient is a mentally ill person subject to hospitalization bycourt order, all provisions of this chapter with respect toinvoluntary hospitalization apply to such person.

Judicial proceedings for hospitalization shall not becommenced with respect to a voluntary patient except pursuant tothis section.

Sections 5121.01 to 5121.10 5121.30 to 5121.56 of the Revised Code apply topersons received in a hospital operated by the department ofmental health on a voluntary application.

The chief clinical officer of the hospital shall providereasonable means and arrangements for informing patients of theirrights to release as provided in this section and for assistingthem in making and presenting requests for release or for ahearing under section 5122.141 of the Revised Code.

Before a patient is released from a public hospital, thechief clinical officer shall, when possible, notify the board ofthe patient's county of residence of the patient's pendingrelease after he the chief clinical officer has informed thepatient that the board will beso notified.

Sec. 5122.31.  (A) All certificates, applications, records, andreports made for the purpose of this chapter and sections2945.38,2945.39, 2945.40, 2945.401, and2945.402 of the Revised Code,other thancourt journal entries or court docket entries, anddirectly orindirectly identifying a patient or former patient orpersonwhose hospitalization has been sought under this chapter,shallbe kept confidential and shall not be disclosed by anypersonexcept:

(A)(1) If the person identified, or the person's legalguardian, if any, or if the person is a minor,the person's parentor legal guardian, consents, and if thedisclosureis in the bestinterests of the person, as may be determined by the court forjudicial records and by the chief clinical officer for medicalrecords;

(B)(2) When disclosure is provided for in this chapter orsection 5123.60 of the Revised Code;

(C)(3) That hospitals, boards of alcohol, drug addiction, andmental health services, and community mental health agencies mayrelease necessary medicalinformationto insurersand otherthird-party payers, including government entities responsible forprocessing and authorizing payment, to obtain payment for goodsand servicesfurnished tothe patient;

(D)(4) Pursuant to a court order signed by a judge;

(E)(5) That a patient shall be granted access to the patient'sown psychiatric and medical records, unless access specificallyisrestricted in a patient's treatment plan for clear treatmentreasons;

(F)(6) That hospitals and other institutions and facilitieswithin the department of mental health may exchange psychiatricrecords and other pertinent information with other hospitals,institutions, and facilities of the department, and withcommunitymental health agencies and boards of alcohol, drugaddiction, andmental health services with which the departmenthas a currentagreement for patient care or services. Recordsand informationthat may be released pursuant to this divisionshall be limited tomedication history, physical health statusand history, financialstatus, summary of course of treatment inthe hospital, summary oftreatment needs, and a dischargesummary, if any.

(G)(7) That a patient's family member who is involved in theprovision, planning, and monitoring of services to the patientmayreceive medication information, a summary of the patient'sdiagnosis and prognosis, and a list of the services and personnelavailable to assist the patient and the patient's family, ifthepatient'streating physician determines that the disclosure wouldbeinthe best interests of the patient. No such disclosure shallbemade unless the patient is notified first and receives theinformation and does not object to the disclosure.

(H)(8) That community mental health agencies may exchangepsychiatric records and certain other information with the boardof alcohol, drug addiction, and mental health services and otheragencies in order to provide services to a person involuntarilycommitted to a board. Release of records under this divisionshall be limited to medication history, physical health statusandhistory, financial status, summary of course of treatment,summaryof treatment needs, and discharge summary, if any.

(I)(9) That information may be disclosed to the executor ortheadministrator of an estate of a deceased patient whentheinformation is necessary to administer the estate;

(J)(10) That records in the possession of the Ohio historicalsociety may be released to the closest living relative of adeceased patient upon request of that relative;

(K)(11) That information may be disclosed to staff members ofthe appropriate board or to staff members designated by thedirector of mental health for the purpose of evaluating thequality, effectiveness, and efficiency of services anddeterminingif the services meet minimum standards. Informationobtainedduring such evaluations shall not be retained with thename of anypatient.

(L)(12) That records pertaining to the patient's diagnosis,course of treatment, treatment needs, and prognosis shall bedisclosed and released to the appropriate prosecuting attorney ifthe patient was committed pursuant to section 2945.38, 2945.39,2945.40, 2945.401, or 2945.402 ofthe Revised Code, or to theattorney designated bythe board for proceedings pursuant toinvoluntary commitment under this chapter.

(M)(13) That the department of mental health may exchangepsychiatrichospitalization records, other mental health treatmentrecords, and otherpertinent information with the department ofrehabilitation andcorrection to ensure continuity of care forinmates who arereceiving mental health services in an institutionof thedepartment of rehabilitation and correction. Thedepartmentshall not disclose those records unless the inmate isnotified,receives the information, and does not object to thedisclosure. The releaseof records under this division is limitedto recordsregarding an inmate's medication history, physicalhealthstatus and history, summary of course of treatment, summaryoftreatment needs, and a discharge summary, if any.

(N)(14)That a community mental health agency that ceases tooperate may transfer to either a community mental health agencythat assumes its caseload or to the board of alcohol, drugaddiction, and mental health services of the service district inwhich the patient resided at the time services were mostrecentlyprovided any treatment records that have not been transferredelsewhere at the patient's request.

(O)(B) Before records are disclosed pursuant to divisions (C)(A)(3),(F)(6), and (H)(8) of this section, the custodian of the records shallattempt to obtain the patient's consent for the disclosure. Noperson shall reveal the contents of a medical record of a patientexcept as authorized by law.

(C) The managing officer of a hospital who releases necessary medical information under division (A)(3) of this section to allow an insurance carrier or other third party payor to comply with section 5121.43 of the Revised Code shall neither be subject to criminal nor civil liability.

Sec. 5123.01.  As used in this chapter:

(A)"Chief medical officer" means the licensed physicianappointed by the managing officer of an institution for thementally retarded with the approval of the director of mentalretardation and developmental disabilities to provide medicaltreatment for residents of the institution.

(B)"Chief program director" means a person with specialtraining and experience in the diagnosis and management of thementally retarded, certified according to division (C) of thissection in at least one of the designated fields, and appointedbythe managing officer of an institution for the mentallyretardedwith the approval of the director to providehabilitation and carefor residents of the institution.

(C)"Comprehensive evaluation" means a study, including asequence of observations and examinations, of a person leading toconclusions and recommendations formulated jointly, withdissenting opinions if any, by a group of persons with specialtraining and experience in the diagnosis and management ofpersonswith mentalretardation or a developmental disability, whichgroupshall include individuals who are professionally qualifiedin thefields of medicine, psychology, and socialwork, together withsuch other specialists as the individual casemay require.

(D)"Education" means the process of formal training andinstruction to facilitate the intellectual and emotionaldevelopment of residents.

(E)"Habilitation" means the process by which the staff ofthe institution assists the resident in acquiring and maintainingthose life skills that enable the resident to cope moreeffectively withthe demands of the resident's own person and ofthe resident's environment and inraising the level of theresident's physical, mental,social, and vocationalefficiency.Habilitation includes but is not limited to programsof formal,structured education and training.

(F)"Habilitation center services" means services provided bya habilitation center certified by the department of mentalretardation and developmental disabilities under section 5123.041of the Revised Code and covered by the medicaid program pursuantto rules adopted under section 5111.041 of the Revised Code.

(G)"Health officer" means any public health physician,public health nurse, or other person authorized or designated byacity or general health district.

(H)(G) "Home and community-based services" meansmedicaid-funded home and community-based services specified in division (B)(1) of section 5111.87 of the Revised Code provided under themedicaid waiver components the department of mental retardation anddevelopmental disabilities administers pursuant to section5111.871 of the Revised Code.

(I)(H)"Indigent person" means a person who is unable,withoutsubstantial financial hardship, to provide for the paymentof anattorney and for other necessary expenses of legalrepresentation,including expert testimony.

(J)(I)"Institution" means a public or private facility, or apart of a public or private facility, that islicensed by theappropriate statedepartment and is equipped to provideresidential habilitation,care, and treatment for the mentallyretarded.

(K)(J)"Licensed physician" means a person who holds a validcertificate issued under Chapter 4731. of the Revised Codeauthorizing the person to practice medicine and surgery orosteopathic medicine and surgery, or a medical officer of thegovernment ofthe United States while in the performance of theofficer's official duties.

(L)(K)"Managing officer" means a person who is appointed bythedirector of mental retardation and developmental disabilitiestobe in executive control of an institution for the mentallyretarded under the jurisdiction of the department.

(M)(L) "Medicaid" has the same meaning as in section 5111.01ofthe Revised Code.

(N)(M) "Medicaid case management services" means casemanagement services provided to an individual with mentalretardation or other developmental disability that the statemedicaid plan requires.

(O)(N)"Mentally retarded person" means a person havingsignificantly subaverage general intellectual functioningexistingconcurrently with deficiencies in adaptive behavior,manifestedduring the developmental period.

(P)(O)"Mentally retarded person subject toinstitutionalizationby court order" means a person eighteenyearsof age or older whois at least moderately mentally retarded andinrelation to whom,because of the person's retardation, eitherof the followingconditions exist:

(1) The person represents a very substantial risk ofphysical impairment or injury to self as manifested byevidencethat the person is unable to provide for and is notprovidingforthe person's most basic physical needs and thatprovision forthoseneeds is not available in the community;

(2) The person needs and is susceptible to significanthabilitation in an institution.

(Q)(P)"A person who is at least moderately mentallyretarded"means a person who is found, following a comprehensiveevaluation,to be impaired in adaptive behavior to a moderatedegree and to befunctioning at the moderate level ofintellectualfunctioning inaccordance with standard measurementsas recordedin the mostcurrent revision of the manual ofterminology andclassificationin mental retardation published bythe Americanassociation onmental retardation.

(R)(Q) As used in this division,"substantial functionallimitation,""developmental delay," and"established risk" havethe meaningsestablished pursuant to section 5123.011 of theRevised Code.

"Developmental disability" means a severe, chronicdisabilitythat is characterized by all of the following:

(1) It is attributable to a mental or physical impairmentora combination of mental and physical impairments, other than amental or physical impairment solely caused by mental illness asdefined in division (A) of section 5122.01 of the Revised Code.

(2) It is manifested before age twenty-two.

(3) It is likely to continue indefinitely.

(4) It results in one of the following:

(a) In the case of a person under three years of age, atleast onedevelopmental delay or an established risk;

(b) In the case of a person at least three years of age butunder six years of age, at least two developmental delays or anestablished risk;

(c) In the case of a person six years of age or older, asubstantial functional limitation in at least three of thefollowing areas of major life activity, as appropriate for theperson's age: self-care, receptive and expressive language,learning,mobility, self-direction, capacity for independentliving, and,if the person is at least sixteen years of age,capacityfor economic self-sufficiency.

(5) It causes the person to need a combination andsequenceof special, interdisciplinary, or other type of care,treatment,or provision of services for an extended period oftime that isindividually planned and coordinated for the person.

(S)(R)"Developmentally disabled person" means a person withadevelopmental disability.

(T)(S)"State institution" means an institution that istax-supported and under the jurisdiction of the department.

(U)(T)"Residence" and"legal residence" have the samemeaningas"legal settlement," which is acquired by residing inOhio for aperiod of one year without receiving generalassistanceprior toJuly17, 1995, under former Chapter 5113. of the RevisedCode, financialassistance under Chapter 5115. of the RevisedCode, orassistance from aprivate agency that maintains recordsofassistance given. A person having alegal settlement in thestateshall be considered as having legal settlementin theassistancearea in which the person resides. No adultpersoncoming intothisstate and having a spouse or minor childrenresiding inanother state shallobtain a legal settlement in thisstate aslong asthe spouse or minorchildren are receiving publicassistance, care, or support at the expense ofthe other state orits subdivisions. For the purpose of determining the legalsettlement of a person who is living in a public or privateinstitution or ina home subject to licensing by the department ofjob and family services,thedepartment of mental health, or thedepartment of mental retardation anddevelopmental disabilities,the residence of the personshall be considered as though theperson were residing in the county in whichthe person was livingprior to the person's entrance into the institution orhome.Settlement once acquired shall continue until a person has beencontinuously absent from Ohio for a period ofone year or hasacquired a legal residence in another state. A woman whomarriesa man with legal settlement in any county immediately acquiresthesettlement of her husband. The legal settlement of a minoristhat of the parents, surviving parent, sole parent, parent whoisdesignated the residential parent and legal custodian by acourt,other adult having permanent custody awarded by a court,orguardian of the person of the minor, provided that:

(1) A minor female who marries shall be considered to havethe legal settlement of her husband and, in the case of death ofher husband or divorce, she shall not thereby lose herlegalsettlement obtained by the marriage.

(2) A minor male who marries, establishes a home, and whohas resided in this state for one year without receiving generalassistance prior to July17, 1995, under former Chapter 5113. ofthe Revised Code, financialassistance under Chapter 5115. of theRevised Code, or assistance from aprivate agency that maintainsrecords of assistance givenshall be consideredto have obtained alegal settlement in this state.

(3) The legal settlement of a child undereighteen years ofage who is in the care or custody of a public orprivate childcaring agency shall not change if the legal settlement oftheparent changes until after the child has been in the home oftheparent for a period of one year.

No person, adult or minor, may establish a legal settlementin this state for the purpose of gaining admission to any stateinstitution.

(V)(U)(1)"Resident" means, subject to division (R)(2) ofthissection, a personwho is admitted either voluntarilyorinvoluntarily to an institution or other facility pursuant tosection 2945.39, 2945.40, 2945.401, or2945.402 of the RevisedCode subsequent to a finding of not guiltyby reason of insanityor incompetence to stand trial or under thischapter who is underobservation or receiving habilitation and care in an institution.

(2)"Resident" does not include a person admitted to aninstitution or other facility under section 2945.39, 2945.40,2945.401, or2945.402 of the Revised Code to the extent that thereference in thischapter toresident, or the context in which thereference occurs, is in conflict withany provision of sections2945.37 to 2945.402 of the Revised Code.

(W)(V)"Respondent" means the person whose detention,commitment, or continued commitment is being sought in anyproceeding under this chapter.

(X)(W)"Working day" and"court day" mean Monday, Tuesday,Wednesday, Thursday, and Friday, except when such day is a legalholiday.

(Y)(X)"Prosecutor" means the prosecuting attorney, villagesolicitor, city director of law, or similar chief legal officerwho prosecuted a criminal case in which a person was found notguilty by reason of insanity, who would have had the authority toprosecute a criminal case against a person if the person had notbeen found incompetent to stand trial, or who prosecuted a caseinwhich a person was found guilty.

(Z)(Y)"Court" means the probate division of the court ofcommonpleas.

Sec. 5123.045. (A) No person or government entity shallreceive payment for providing home and community-based servicesunless the person or government entity is one of the following:

(1)(A) Certified under this section 5123.16 of the Revised Code;

(2)Certified as a supportedliving provider under section5126.431 of the Revised Code;

(3)(B) Licensed as a residential facility under section 5123.19of the Revised Code. Division (A)(3) of this section does notapply to an intermediate care facility for the mentally retardedas defined in section 5111.20 of the Revised Code.

(B) The department of mental retardation and developmentaldisabilities shall do all of the following in accordance withChapter 119. of the Revised Code:

(1) Certify a person or government entity to provide homeand community-based services if the person or government entitysatisfies the requirements for certification established by rulesadopted under division (C) of this section;

(2) Revoke a certificate when required to do so by rulesadopted under division (C) of this section;

(3) Hold hearings when there is a dispute between thedepartment and a person or government entity concerning actionsthe department takes or does not take under division (B)(1) or (2)of this section.

(C) The director of mental retardation and developmentaldisabilities shall adopt rules in accordance with Chapter 119. ofthe Revised Code establishing certification requirements andprocedures for a person or government entity that seeks to providehome and community-based services and is not certified as asupported living provider under section 5126.431 of the RevisedCode or licensed as a residential facility under section 5123.19of the Revised Code. The rules shall specify the program areasfor whichcertification is required and include procedures for allof thefollowing:

(1) Ensuring that providers comply with section 5126.28 or5126.281 ofthe Revised Code, as appropriate;

(2) Evaluating the services provided to ensure that theyareprovided in a quality manner advantageous to the individualreceiving the services.The procedures shall require that all ofthe following beconsidered as part of an evaluation:

(a) The provider's experience and financialresponsibility;

(b) The provider's ability to comply with standards for thehome and community-based services that the provider provides;

(c) The provider's ability to meet the needs of theindividuals served;

(d) Any other factor the director considers relevant.

(3) Determining when to revoke a provider's certificate.Thereasons for which a certificate may be revoked mayincludegoodcause, includingmisfeasance, malfeasance, nonfeasance,confirmedabuse or neglect,financial irresponsibility, or otherconduct thedirectordetermines is injurious to individuals beingserved.

(D) The records of an evaluation conducted in accordancewith rules adopted under division (C)(2) of this section arepublic records for purposes of section 149.43 of the Revised Codeand shall be made available on request of any person, includingindividuals being served, individuals seeking home andcommunity-based services, and county boards of mental retardationand developmental disabilities.

Sec. 5123.046. The department of mental retardation anddevelopmental disabilities shall review eachcomponent of thethree-calendar year plan it receives froma county board of mentalretardation and developmentaldisabilities under section 5126.054of the Revised Code and, inconsultation with the department ofjob and family services andoffice of budget and management,approve eachcomponent that includesall the information andconditions specified in that section.The fourth component oftheplan shall be approved or disapproved not later thanforty-fivedays after thefourthcomponent is submitted to thedepartmentunder division (B)(3) ofsection 5126.054 of the RevisedCode.Ifthe department approvesall four components of the plan, the planis approved. Otherwise,the plan is disapproved. If the plan isdisapproved, thedepartment shall take actionagainst the countyboard underdivision (B) of section 5126.056 ofthe Revised Code.

In approving plans under this section, the departmentshallensure that the aggregate of all plans provide for theincreasedenrollment into home and community-based services duringeachstate fiscal year of at least five hundred individuals whodid notreceive residential services, supported living, or homeandcommunity-based services the prior state fiscal year if thedepartment has enough additional enrollment available for thispurpose.

The department shall establish protocolsthat the departmentshall use to determine whether a county boardis complying withthe programmatic and financial accountability mechanisms andachieving outcomesspecified in its approved plan. If thedepartmentdetermines that acounty board is not in compliancewith themechanisms or achieving the outcomes specified in itsapprovedplan, the departmentmay take action under division (G)(F)ofsection 5126.055 of the Revised Code.

Sec. 5123.047. (A) The department of mental retardation anddevelopmental disabilities shall pay the nonfederal share ofmedicaid expenditures for habilitation center services provided toan individual with mental retardation or other developmentaldisability unless section 5111.041 of the Revised Code requires acounty board of mental retardation and developmental disabilitiesor a school district to pay the nonfederal share.

(B) The department of mental retardation and developmental disabilities shall pay the nonfederal share ofmedicaid expenditures for medicaid case management services ifeither of the following apply:

(1) The the services are provided to an individual with mentalretardation or other developmental disability who a county board of mental retardation and developmental disabilitieshas determined under section 5126.041 of the Revised Code is noteligible for county board services;

(2) The services are provided to an individual with mentalretardation or other developmental disability by a public orprivate agency with which the department has contracted undersection 5123.56 of the Revised Code to provide protective servicesto the individual.

(C)(B) The department shall pay the nonfederal share ofmedicaid expenditures for home and community-based services ifeither any of the following apply:

(1) The services areprovided to an individual with mentalretardation or otherdevelopmental disability who a county boardhas determined undersection 5126.041 of the Revised Code is noteligible for countyboard services;

(2) The services are provided to an individual with mentalretardation or other developmental disability given priority forthe services pursuant to division (D)(3) of section 5126.042 ofthe Revised Code. The department shall pay the nonfederal shareof medicaid expenditures for home and community-based servicesprovided to such an individual for as long as the individualcontinues to be eligible for and receive the services, regardlessof whether the services are provided after June 30, 2003.

(3) An agreement entered into under section 5123.048 of the Revised Code requires that the department pay the nonfederal share of medicaid expenditures for the services.

Sec. 5123.048. The director of mental retardation and developmental disabilities may enter into an agreement with a county board of mental retardation and developmental disabilities under which the department of mental retardation and developmental disabilities is to pay the nonfederal share of medicaid expenditures for home and community-based services provided to individuals with mental retardation or other developmental disability residing in the county served by the county board.

Sec. 5123.049. The director of mental retardation anddevelopmental disabilities shall adopt rules in accordance withChapter 119. of the Revised Code governing the authorization andpayment of home and community-based services, and medicaid casemanagement services, and habilitation center services. The rulesshall provide for private providers of the services to receive onehundred per cent of the medicaid allowable payment amount and forgovernment providers of the services to receive the federal shareof the medicaid allowable payment, less the amount withheld as afee under section 5123.0412 of the Revised Code and any amountthat may be required by rules adopted under section 5123.0413 ofthe Revised Code to be deposited into the state MR/DD risk fund.Therules shall establish the process by which county boards ofmentalretardation and developmental disabilities shall certifyandprovide the nonfederal share of medicaid expenditures that thecounty board is required by division (A) of section5126.057 ofthe Revised Code to pay. The process shall require acounty boardto certify that the county board has fundingavailable at one timefor two months costs for those expenditures.The process maypermit a county board to certify that the countyboard has fundingavailable at one time for more than two monthscosts for thoseexpenditures.

Sec. 5123.0412. (A) Thedepartment of mental retardationanddevelopmental disabilities shall charge each county board ofmental retardationand developmental disabilities an annual feeequal to one and one-half per cent of thetotal value of all medicaid paidclaims for medicaid case management services and home andcommunity-based services for which the county board contracts orprovides itself provided during the year to an individual eligible for services from the county board. No county board shall pass the cost of a feecharged to the county board under this section on to a person orgovernment entity with which the county board contracts to providethe another provider of these services.

(B) The fees collected under this sectionshall bedepositedinto the ODMR/DD administration and oversight fund andtheODJFSadministration and oversight fund, both of which areherebycreatedin the state treasury. The portion of the fees tobedeposited into the ODMR/DD administration and oversight fundandthe portion of the fees to be deposited into the ODJFSadministration and oversight fund shall be the portion specifiedin an interagency agreement entered into under division (C) ofthis section. The department of mental retardation anddevelopmental disabilities shall use the money in the ODMR/DDadministration and oversight fund and the department of job andfamily services shall use the money in the ODJFS administrationand oversight fund for both of the following purposes:

(1) The administrative and oversight costs of habilitationcenter services, medicaid case management services, and home andcommunity-based services that a county board develops and monitorsand the county board or a person or government entity undercontract with the county board provides. The administrative andoversight costs shall include costs for staff, systems, and otherresources the departments need and dedicate solely to thefollowing duties associated with the services:

(a) Eligibility determinations;

(b) Training;

(c) Fiscal management;

(d) Claims processing;

(e) Quality assurance oversight;

(f) Other duties the departments identify.

(2) Providing technical support to county boards' localadministrative authority under section 5126.055 of the RevisedCode for the services.

(C) The departments of mental retardation and developmentaldisabilities and job and family services shall enter into aninteragency agreement to do both of the following:

(1) Specify which portion of the fees collected under thissection is to be deposited into the ODMR/DD administration andoversight fund and which portion is to be depositedinto theODJFS administration and oversight fund;

(2) Providefor the departments to coordinatethe staffwhose costs are paid for with money in the ODMR/DDadministrationand oversight fund and the ODJFS administration andoversightfund.

(D) The departments shall submit an annual report to thedirector of budget and management certifying how the departmentsspent the money in the ODMR/DD administration and oversight fundand the ODJFS administration and oversight fund for the purposesspecified in division (B) of this section.

Sec. 5123.16. (A) In accordance with Chapter 119. of the Revised Code, the director of mental retardation and developmental disabilities shall adopt and may amend and rescind rules for the certification of persons or government entities as described in division (A) of section 5123.045 of the Revised Code that provide or propose to provide home and community-based waiver services. The rules shall establish or specify all of the following:

(1) Procedures for issuing and renewing certification and establishing expiration dates for currently certified providers;

(2) Procedures and criteria for denying, refusing to renew, terminating, and revoking certification in accordance with this section and Chapter 119. of the Revised Code;

(3) Procedures for ordering the suspension of a certified provider's certification;

(4) Fees for issuing and renewing certification. All fees collected pursuant to this section shall be deposited in the state treasury to the credit of the provider certification fund, which is hereby created. Money credited to the fund shall be used solely for the operation of the provider certification program established under this section.

(5) Program services for which certification is required and provider standards for those services;

(6) Procedures for certification;

(7) Procedures for ensuring that providers comply with sections 5123.52 and 5126.281 of the Revised Code.

(B) A provider's certification may be terminated when the certified provider has not billed for services for a period of more than twelve consecutive months and the provider has been notified in accordance with Chapter 119. of the Revised Code.

(C) The director may suspend or revoke a provider's certification in accordance with Chapter 119. of the Revised Code for good cause, including misfeasance, malfeasance, nonfeasance, confirmed abuse or neglect, noncompliance with provider certification standards, financial irresponsibility, or other conduct the department determines is injurious to individuals being served.

(D)(1) The director may suspend a certified provider's certification to serve one or more individuals currently served by the provider in one or more counties before providing an opportunity for an adjudication under Chapter 119. of the Revised Code when the director determines that the certified provider has demonstrated a pattern of serious noncompliance with certification standards or that a violation of certification standards creates a substantial risk to the health and safety of an individual served by the certified provider and both the following conditions are met:

(a) The individual or guardian, as appropriate, has been made aware of the patterns of serious noncompliance or violations of certification standards that create a substantial risk to the health and safety of the individual, and the individual or guardian does not choose to select another certified provider; and

(b) A county board of mental retardation and developmental disabilities has filed a complaint with the probate court in accordance with section 5126.33 of the Revised Code and the probate court does not issue an order authorizing the board to arrange protective services for the individual.

(2) The director may suspend a certified provider's certification to begin to serve one or more individuals not currently being served by the provider in one or more counties before providing an opportunity for an adjudication under Chapter 119. of the Revised Code when the director determines that the certified provider has demonstrated a pattern of serious noncompliance with certification standards or that a violation of certification standards creates a substantial risk to the health and safety of an individual served by the certified provider.

(3) Except as provided in division (D)(4) of this section, appeals from proceedings initiated to terminate a provider's certification under division (B) of this section or to suspend or revoke a provider's certification under division (C) of this section shall be conducted in accordance with Chapter 119. of the Revised Code.

(4) Appeals from proceedings initiated to order the suspension of a certified provider's certification shall be conducted in accordance with Chapter 119. of the Revised Code, unless the order was issued before providing an opportunity for an adjudication, in which case all of the following apply:

(a) The department shall notify the certified provider within twenty-four hours of ordering of the suspension.

(b) The certified provider may request a hearing not later than ten days after receiving the notice specified in section 119.07 of the Revised Code.

(c) If a timely request for a hearing is made, the hearing shall commence not later than thirty days after the department receives the request.

(d) After commencing, the hearing shall continue, uninterrupted, except for Saturdays, Sundays, and legal holidays, unless other interruptions are agreed to by the provider and the director.

(e) If the hearing is conducted by a hearing examiner, the hearing examiner shall file a report and recommendations not later than ten days after the close of the hearing. For purposes of division (D)(4)(d) of this section, the hearing shall not be considering closed until the hearing examiner receives the transcript of the hearing, if a transcript is ordered, and all post-hearing briefs, if any, are timely filed.

(f) A copy of such written report and recommendations of the hearing examiner shall, within five days of the date of the filing thereof, be served upon the provider or the provider's attorney, by certified mail.

(g) The provider may file objections to the report and recommendations not later than five days after the receipt of the report and recommendations.

(h) No recommendation of the hearing examiner shall be approved, modified, or disapproved by the department until five days after service of the hearing examiner's report and recommendations upon the provider or the provider's attorney.

(i) Not later than fifteen days after the service of such report and recommendations of the hearing examiner upon the provider or the provider's attorney, the director shall issue an order approving, modifying, or disapproving the report and recommendation.

(j) The order shall be lifted when the provider has submitted an acceptable plan of compliance and the department determines the plan of compliance has been appropriately implemented.

(k) Following the issuance of an adjudication order by the director, the provider may appeal the order in accordance with section 119.12 of the Revised Code.

(l) Notwithstanding the pendency of the hearing, the director shall lift the order for the suspension of the certified provider's certification under division (D)(1) or (D)(2) of this section when the director determines that the violation that formed the basis for the order has been corrected. The hearing shall continue unless the provider withdraws, in writing, the appeal of the department's suspension.

(E) All applicants for or holders of certification under this section shall maintain a current address with the director at all times.

(F) An applicant whose certification has been denied in accordance with this section may not apply to become a certified provider within one year of the date of the applicant's denial of certification. A certified provider whose certification has been revoked in accordance with this section may not apply for certification within five years of the revocation of the certified provider's certification.

(G) The records of surveys of providers conducted in accordance with this section are public records for purposes of section 149.43 of the Revised Code and shall be made available upon request of any person, including individuals being served, individuals seeking home and community-based services, and county boards of mental retardation and developmental disabilities.

(H) The certification of a provider that is certified to provide home and community-based services on the effective date of this section shall remain in effect until the department establishes an expiration date for the certification unless the certification is voluntarily surrendered or terminated, suspended or revoked in accordance with this section.

(I) As used in this section, "home and community-based services" has the same meaning as in section 5126.01 of the Revised Code.

(J) The director of mental retardation and developmental disabilities shall not apply any provisions of sections 5126.40 to 5126.47 of the Revised Code to any provider of home and community-based services certified under this section.

Sec. 5123.34.  This chapter attempts to do all of the following:

(A) Provide humane and scientific treatment and careand the highest attainable degree of individual development forpersons with mentalretardation or a developmental disability;

(B) Promote the study of the causes of mentalretardation and developmental disabilities, with a view toultimate prevention;

(C) Secure by uniform and systematic management thehighest attainable degree of economy in the administration of theinstitutions under the control of the department of mentalretardation and developmental disabilities.

Sections 5123.02 to 5123.04, 5123.041 to 5123.042, 5123.043,5123.10, 5123.21, 5123.221, 5123.25, and 5123.31 of the Revised Code shall beliberally construed to attain these purposes.

Sec. 5123.41.  As used in this section and sections5123.42to 5123.47 of the Revised Code:

(A) "Adult services" has the same meaning as in section5126.01 of the Revised Code.

(B) "Certified home and community-based services provider"means a person or government entity certified under section5123.045 5123.16 of the Revised Code.

(C) "Certified supported living provider" means a person orgovernment entity certified under section 5126.431 of the RevisedCode.

(D)"Drug" has the same meaning as in section 4729.01 oftheRevised Code.

(E) "Family support services" has the same meaning as insection 5126.01 of the Revised Code.

(F) "Health-related activities" means the following:

(1) Taking vital signs;

(2) Application of clean dressings that do not requirehealthassessment;

(3) Basic measurement of bodily intake and output;

(4) Oral suctioning;

(5) Use of glucometers;

(6) External urinary catheter care;

(7) Emptying and replacing colostomy bags;

(8) Collection of specimens by noninvasive means.

(G) "Licensed health professional authorized to prescribedrugs" has the same meaning as in section 4729.01 of the RevisedCode.

(H) "Medicaid" has the same meaning as in section 5111.01 ofthe Revised Code.

(I) "MR/DD personnel" means the employees and the workersundercontract who providespecialized services to individualswithmental retardation anddevelopmental disabilities. "MR/DDpersonnel" includes those who provide the services as follows:

(1) Throughdirect employment with the department of mentalretardation anddevelopmental disabilities or a county board ofmental retardationand developmental disabilities;

(2) Through anentity under contract with the department ofmental retardationand developmental disabilities or a countyboard of mentalretardation and developmental disabilities;

(3) Throughdirect employment or by being under contractwith privateentities, including private entities that operateresidentialfacilities.

(J) "Nursing delegation" means the process established inrules adopted by the board of nursing pursuant to Chapter 4723. ofthe Revised Code under which a registered nurse or licensedpractical nurse acting at the direction of a registered nursetransfers the performance of a particular nursing activity or taskto another person who is not otherwise authorized to performtheactivity or task.

(K) "Prescribed medication" means a drug that is to beadministered according to the instructions of a licensed healthprofessional authorized to prescribe drugs.

(L) "Residential facility" means a facility licensed undersection 5123.19 of the Revised Code or subject to section 5123.192of the Revised Code.

(M) "Specialized services" has the same meaning as insection 5123.50 of the Revised Code.

(N) "Tube feeding" means the provision of nutrition to anindividual through a gastrostomy tube or a jejunostomy tube.

Sec. 5123.701.  (A) Except as provided in division (E)of this section, any person in the community who iseighteen years of age or older and who is or believesself tobe mentally retarded may make written application to themanaging officer of any institution for temporary admission forshort-term care. The application may be made on behalf of a minor by aparent or guardian, and on behalf of an adult adjudicatedmentally incompetent by a guardian.

(B) For purposes of this section, short-term care shall bedefined to mean appropriate services provided to a person withmental retardation for no more than fourteen consecutive days andfor no more than forty-two days in a fiscal year. Whencircumstances warrant, the fourteen-day period may be extended atthe discretion of the managing officer. Short-term care isprovided in a developmental center to meet the family's orcaretaker's needs for separation from the person with mentalretardation.

(C) The managing officer of an institution, with theconcurrence of the chief program director, may admit a person forshort-term care only after a medical examination has been made ofthe person and only if the managing officer concludes that theperson is mentally retarded.

(D) If application for admission for short-term care of aminor or of a person adjudicated mentally incompetent is made bythe minor's parent or guardian or by theincompetent's guardian and the minor or incompetent is admitted, theprobatedivision of the court of common pleas shall determine, uponpetition by the legal rights service, whether the admission forshort-term care is in the best interest of the minor or theincompetent.

(E) A person who is found not guilty by reason of insanityshall not admit self to an institution for short-termcareunless a hearing was held regarding theperson pursuant to division (A) ofsection 2945.40 of the Revised Code and either ofthe following applies:

(1) The person was found at the hearing not to be amentally retarded person subject toinstitutionalization by court order;

(2) The person was found at the hearing to be a mentallyretarded person subject toinstitutionalization by court order, was involuntarily committed, and wasfinallydischarged.

(F) The mentally retarded person, liable relatives, andguardians of mentally retarded persons admitted for respite careshall pay support charges in accordance with sections 5121.03 5121.01 to5121.07 5121.21 of the Revised Code.

(G) At the conclusion of each period of short-term care,the person shall return to the person's family or caretaker. Under nocircumstances shall a person admitted for short-term careaccording to this section remain in the institution after theperiod of short-term care unless the person is admittedaccording to section 5123.70, sections 5123.71 to 5123.76, or section2945.38, 2945.39, 2945.40, 2945.401,or 2945.402 of the Revised Code.

Sec. 5123.71.  (A)(1) Proceedings for the involuntaryinstitutionalization of a person pursuant to sections 5123.71 to5123.76 of the Revised Code shall be commenced by the filing ofanaffidavit with the probate division of the court of commonpleasof the county where the person resides orwhere the person isinstitutionalized, in the manner and formprescribed by thedepartment of mental retardation anddevelopmental disabilitieseither on information or actualknowledge, whichever isdeterminedto be proper by the court. Theaffidavit may be filed only by aperson who has custody of theindividual as a parent, guardian, orserviceprovider or by aperson acting on behalf of the departmentor a county boardofmental retardation and developmentaldisabilities. This sectiondoes notapply regarding theinstitutionalization of a personpursuant to section2945.39,2945.40, 2945.401, or 2945.402 of theRevised Code.

The affidavit shall contain an allegation settingforth thespecific category or categories under division(P)(O) ofsection5123.01 of the Revised Code upon which the commencementofproceedings is based and a statement of the factual ground forthebelief that the person is a mentally retarded person subject toinstitutionalization bycourt order. Except as provided indivision (A)(2) of this section, theaffidavit shall beaccompanied by both of the following:

(a) A comprehensive evaluation report prepared by theperson's evaluationteam that includes a statement by the membersof the team certifying that theyhave performed a comprehensiveevaluation of the person and that they are ofthe opinion thattheperson is a mentally retarded person subject toinstitutionalization by court order;

(b) An assessment report prepared by the county board ofmental retardationand developmental disabilities under section5123.711 of the Revised Codespecifying that the individual is inneed of services on an emergency orpriority basis.

(2) In lieu of the comprehensiveevaluation report, theaffidavit may be accompanied by a written and swornstatement thatthe person or the guardian of a personadjudicated incompetent hasrefused to allow a comprehensiveevaluation and county boardassessmentand assessment reports. Immediately after acceptinganaffidavit that is not accompanied by thereports of acomprehensive evaluation and county board assessment, the courtshall cause a comprehensive evaluation and county board assessmentof theperson named in the affidavit to be performed. Theevaluation shall beconducted in the least restrictive environmentpossible and the assessmentshall be conducted in the same manneras assessments conducted undersection 5123.711 of the RevisedCode. The evaluation and assessment must becompleted before aprobable cause hearing or full hearing may be held undersection5123.75 or 5123.76 of the Revised Code.

A written report of the evaluation team's findings and thecountyboard's assessment shall be filed with the court. Thereports shall,consistent with the rules of evidence, be acceptedas probative evidence inany proceeding under section 5123.75 or5123.76 of theRevised Code. If the counsel for the person who isevaluated or assessed is known, the courtshall send to thecounsel a copy of the reports as soon as possible after theyarefiled and prior to any proceedings under section 5123.75 or5123.76 of theRevised Code.

(B)Any person who isinvoluntarily detained in aninstitution or otherwise is incustody under this chaptershall beinformed of theright to do the following:

(1) Immediately make a reasonable number of telephonecallsor use other reasonable means to contact an attorney, aphysician,or both, to contact any other person or persons tosecurerepresentation by counsel, or to obtain medical assistance,and beprovided assistance in making calls if the assistance isneededand requested;

(2) Retain counsel and have independent expert evaluationand, if the person is an indigent person, be represented bycourt-appointed counsel and have independent expert evaluation atcourt expense;

(3) Upon request, have a hearing to determine whetherthereis probable cause to believe that the person is amentallyretardedperson subject to institutionalization by court order.

(C) No person who is being treated by spiritual meansthrough prayer alone in accordance with a recognized religiousmethod of healing may be ordered detained or involuntarilycommitted unless the court has determined that the personrepresents a very substantial risk of self-impairment,self-injury, orimpairment or injury to others.

Sec. 5123.76.  (A) The full hearing shall be conducted inamanner consistent with the procedures outlined in this chapterandwith due process of law. The hearing shall be held by a judge oftheprobate division or,upon transfer by the judge of the probatedivision, by anotherjudge of the court of common pleas, or areferee designated bythe judge of the probate division. Anyreferee designated by thejudge of the probate division must be anattorney.

(1) The following shall be made available to counsel fortherespondent:

(a) All relevant documents, information, and evidence inthecustody or control of the state or prosecutor;

(b) All relevant documents, information, and evidence inthecustody or control of the institution, facility, or program inwhich therespondent currently is held or in which the respondenthas been heldpursuant to these proceedings;

(c) With the consent of the respondent, all relevantdocuments, information, and evidence in the custody or control ofany institution or person other than the state.

(2) The respondent has the right to be represented bycounsel of the respondent's choice and has the right toattend thehearingexcept if unusual circumstances of compelling medicalnecessityexist that render the respondent unable to attend andtherespondent has not expressed a desire to attend.

(3) If the respondent is not represented by counsel andthecourt determines that the conditions specified in division(A)(2)of this section justify the respondent's absence and theright tocounsel has not been validly waived, the court shallappointcounsel forthwith to represent the respondent at thehearing,reserving the right to tax costs of appointed counsel totherespondent unless it is shown that the respondent isindigent. Ifthe court appoints counsel, or if the courtdetermines that theevidence relevant to the respondent's absencedoes not justify theabsence, the court shall continue thecase.

(4) The respondent shall be informed of the rightto retaincounsel, to have independent expert evaluation, and, if anindigentperson, to be represented by court appointed counsel andhave expertindependent evaluation at court expense.

(5) The hearing may be closed to the public unless counselfor the respondent requests that the hearing be open to thepublic.

(6) Unless objected to by the respondent, therespondent'scounsel, orthe designee of the director of mental retardation anddevelopmental disabilities, the court, for good cause shown,mayadmit persons having a legitimate interest in the proceedings.

(7) The affiant under section 5123.71 of the Revised Codeshall be subject to subpoena by either party.

(8) The court shall examine the sufficiency of alldocumentsfiled and shall inform the respondent, if present, andtherespondent's counsel of the nature of the content of thedocumentsand thereason for which the respondent is being held or for whichthe respondent's placement isbeing sought.

(9) The court shall receive only relevant, competent, andmaterial evidence.

(10) The designee of the director shall present theevidencefor the state. In proceedings under this chapter, the attorneygeneral shall present the comprehensive evaluation, assessment,diagnosis,prognosis, record of habilitation and care, if any, andlessrestrictive habilitation plans, if any. The attorney generaldoes not have a similar presentation responsibility inconnectionwith a person who has been found not guilty by reasonof insanityand who is the subject of a hearing under section2945.40 of theRevised Code to determine whetherthe person is a mentallyretarded person subject toinstitutionalization by court order.

(11) The respondent has the right to testify and therespondent or the respondent's counsel has the right tosubpoenawitnesses anddocuments and to present and cross-examinewitnesses.

(12) The respondent shall not be compelled to testify andshall be so advised by the court.

(13) On motion of the respondent or the respondent'scounselfor goodcause shown, or upon the court's own motion, the courtmay order acontinuance of the hearing.

(14) To an extent not inconsistent with this chapter, theRules of Civil Procedure shall be applicable.

(B) Unless, upon completion of the hearing, the court findsbyclear and convincing evidence that the respondent named in theaffidavit is a mentally retarded person subject toinstitutionalization by court order, it shall order therespondent's dischargeforthwith.

(C) If, upon completion of the hearing, the court finds byclear and convincing evidence that the respondent is a mentallyretarded person subject to institutionalization by court order,the court mayorder the respondent'sdischarge or order therespondent, for aperiod notto exceed ninety days, to any of thefollowing:

(1) A public institution, provided that commitment oftherespondent to the institution will not cause the institutiontoexceed its licensed capacity determined in accordance withsection5123.19 of the Revised Code and provided that sucha placement isindicated by the comprehensive evaluation reportfiled pursuant tosection 5123.71 of the Revised Code;

(2) A private institution;

(3) A county mental retardation program;

(4) Receive private habilitation and care;

(5) Any other suitable facility, program, or thecare of anyperson consistent with the comprehensive evaluation,assessment,diagnosis, prognosis, and habilitation needs of the respondent.

(D) Any order made pursuant to division (C)(2), (4), or(5)of this section shall be conditional upon the receipt by thecourtof consent by the facility, program, or person to accept therespondent.

(E) In determining the place to which, or the person withwhom, the respondent is to be committed, the court shall considerthe comprehensive evaluation, assessment, diagnosis, and projectedhabilitation plan for the respondent, and shall order theimplementation of the least restrictive alternative available andconsistentwith habilitation goals.

(F) If, at any time it is determined bythe director of thefacility or program to which, or the person towhom, therespondent is committed that the respondent could beequally wellhabilitated in a less restrictive environment thatis available,the following shall occur:

(1) The respondent shall be released by the director ofthefacility or program or by the personforthwith and referredto thecourt together with a report of the findings andrecommendationsof the facility, program, or person.

(2) The director of the facility or program or thepersonshall notify the respondent's counsel and the designee ofthedirector of mental retardation and developmentaldisabilities.

(3) The court shall dismiss the case or order placement inthe less restrictive environment.

(G)(1) Except as provided in divisions (G)(2)and (3) ofthis section, any person who has been committed under thissectionmay apply at any time during the ninety-day period forvoluntaryadmission to an institution under section 5123.69 ofthe RevisedCode. Upon admission of a voluntary resident, themanagingofficer immediately shall notify the court, therespondent'scounsel, and the designee of the director in writingof that factby mail or otherwise, and, upon receiptof the notice, the courtshall dismiss the case.

(2) A person who is found incompetent to standtrialor notguiltyby reason of insanity and who is committedpursuanttosection 2945.39,2945.40, 2945.401, or 2945.402 oftheRevisedCode shall not be voluntarily admitted to an institutionpursuantto division (G)(1) of this section until afterthetermination ofthe commitment, as described in division (J) ofsection 2945.401of the Revised Code.

(H) If, at the end of any commitment period, the respondenthas not already been discharged or has not requested voluntaryadmission status, the director of the facility or program, or theperson to whose care the respondent has been committed, shalldischarge therespondent forthwith, unless at least ten daysbefore theexpiration of that period the designee of the directorof mentalretardation and developmental disabilities or theprosecutorfiles an application with the court requestingcontinuedcommitment.

(1) An application for continued commitment shall includeawritten report containing a current comprehensive evaluation andassessment,a diagnosis, a prognosis, an account of progress andpasthabilitation, and a description of alternative habilitationsettings and plans, including a habilitation setting that is theleast restrictive setting consistent with the need forhabilitation. A copy of the application shall be provided torespondent's counsel. The requirements for notice under section5123.73 of the Revised Code and the provisions of divisions (A)to(E) of this section apply to all hearings on suchapplications.

(2) A hearing on the first application for continuedcommitment shall be held at the expiration of the firstninety-dayperiod. The hearing shall be mandatory and may not bewaived.

(3) Subsequent periods of commitment not to exceed onehundred eighty days each may be ordered by the court if thedesignee of the director of mental retardation and developmentaldisabilities files an application for continued commitment, aftera hearing is held on the application or without a hearing if nohearing is requested and no hearing required under division(H)(4)of this section is waived. Upon the application of apersoninvoluntarily committed under this section, supported by anaffidavitof a licensed physician alleging that the person is nolonger amentally retarded person subject to institutionalizationby courtorder, the court for good cause shown may hold a fullhearing onthe person's continued commitment prior to theexpiration of anysubsequent period of commitment set by thecourt.

(4) A mandatory hearing shall be held at least every twoyears after the initial commitment.

(5) If the court, after a hearing upon a request tocontinuecommitment, finds that the respondent is a mentallyretardedperson subject to institutionalization by court order,the courtmay make an order pursuant to divisions (C), (D), and(E) of thissection.

(I) Notwithstanding the provisions of division (H) of thissection, no person who is found to be a mentally retarded personsubject to institutionalization by court order pursuant todivision(P)(O)(2) of section 5123.01 of the Revised Code shall beheld under involuntary commitment for more than five years.

(J) The managing officer admitting a person pursuant to ajudicial proceeding, within ten working days of the admission,shall make areport of the admission to the department.

Sec. 5126.01.  As used in this chapter:

(A)As used in thisdivision, "adult" means an individualwhoiseighteen years ofage or over and not enrolled in aprogramor service underChapter 3323. of the Revised Code andanindividualsixteenor seventeen years of age whois eligibleforadult services underrules adopted by the director of mentalretardation anddevelopmental disabilities pursuant to Chapter119. of theRevised Code.

(1) "Adultservices" means services provided to an adultoutside the home,except when they are provided within the homeaccording to anindividual's assessed needs and identified in anindividualservice plan, that support learning and assistance inthe area ofself-care, sensory and motor development,socialization, dailyliving skills, communication, communityliving, social skills, orvocational skills.

(2) "Adult services" includes all of the following:

(a)Adult day habilitation services;

(b) Adult day care;

(c) Prevocational services;

(d) Sheltered employment;

(e) Educational experiences and training obtained throughentities and activities that are not expressly intended forindividuals with mental retardation and developmentaldisabilities, including trade schools, vocational or technicalschools, adult education, job exploration and sampling, unpaidwork experience in the community, volunteer activities, andspectator sports;

(f) Community employment services and supportedemploymentservices.

(B)(1) "Adult day habilitation services" means adultservices that do the following:

(a) Provide access to and participation in typicalactivities and functions of community life that are desired andchosen by the general population, including such activities andfunctions as opportunities to experience and participate incommunity exploration, companionship with friends and peers,leisure activities, hobbies, maintaining family contacts,community events, and activities where individuals withoutdisabilities are involved;

(b) Provide supports or a combination of training andsupports that afford an individual a wide variety of opportunitiesto facilitate and build relationships and social supports in thecommunity.

(2) "Adult day habilitation services" includes all of thefollowing:

(a) Personal care services needed to ensure an individual'sability to experience and participate in vocational services,educational services, community activities, and any other adultday habilitation services;

(b) Skilled services provided while receiving adult dayhabilitation services, including such skilled services as behaviormanagement intervention, occupational therapy, speech and languagetherapy, physical therapy, and nursing services;

(c) Training and education in self-determination designedtohelp the individual do one or more of the following: developself-advocacy skills, exercise the individual's civil rights,acquire skills that enable the individual to exercise control andresponsibility over the services received, and acquire skills thatenable the individual to become more independent, integrated, orproductive in the community;

(d) Recreational and leisure activities identified in theindividual's service plan as therapeutic in nature or assistive indeveloping or maintaining social supports;

(e) Counseling and assistanceprovided to obtain housing,including such counseling asidentifying options for either rentalor purchase, identifyingfinancial resources, assessing needs forenvironmentalmodifications, locating housing, and planning forongoingmanagement and maintenance of the housing selected;

(f) Transportation necessary to access adult dayhabilitation services;

(g) Habilitation management, as described in section 5126.14ofthe Revised Code.

(3) "Adult day habilitation services" does not includeactivities that are components of the provision ofresidentialservices, family support services, or supported livingservices.

(C) "Appointing authority" means the following:

(1) In the case of a member of a county board of mental retardation and developmental disabilities appointed by, or to be appointed by, a board of county commissioners, the board of county commissioners;

(2) In the case of a member of a county board appointed by, or to be appointed by, a senior probate judge, the senior probate judge.

(D) "Community employment services" or "supportedemploymentservices" means job training and other services relatedtoemployment outside a sheltered workshop. "Community employmentservices" or "supported employment services" include all of thefollowing:

(1) Job training resulting in the attainment of competitivework, supported work in a typical work environment, orself-employment;

(2) Supervised work experience through an employer paid toprovide the supervised work experience;

(3) Ongoing work in a competitive work environment at awagecommensurate with workers without disabilities;

(4) Ongoing supervision by an employer paid to provide thesupervision.

(E) As used in this division, "substantial functionallimitation," "developmental delay," and "established risk" havethe meanings established pursuant to section 5123.011 of theRevised Code.

"Developmental disability" means a severe, chronicdisabilitythat is characterized by all of the following:

(1) It is attributable to a mental or physical impairmentora combination of mental and physical impairments, other than amental or physical impairment solely caused by mental illness asdefined in division (A) of section 5122.01 of the Revised Code;

(2) It is manifested before age twenty-two;

(3) It is likely to continue indefinitely;

(4) It results in one of the following:

(a) In the case of a person under age three, at least onedevelopmental delay or an established risk;

(b) In the case of a person at least age three but underagesix, at least two developmental delays or an establishedrisk;

(c) In the case of a person age six or older, asubstantialfunctional limitation in at least three of thefollowing areas ofmajor life activity, as appropriate for theperson's age:self-care, receptive and expressive language, learning,mobility,self-direction, capacity for independent living, and, if thepersonis at least age sixteen, capacity for economicself-sufficiency.

(5) It causes the person to need a combination andsequenceof special, interdisciplinary, or other type of care,treatment,or provision of services for an extended period oftime that isindividually planned and coordinated for the person.

(F) "Early childhood services" means a planned program ofhabilitation designed to meet the needs of individuals withmentalretardation or other developmental disabilities who havenotattained compulsory school age.

(G)(1) "Environmental modifications" means the physicaladaptations to an individual's home, specified in the individual'sservice plan, that are necessary to ensure the individual'shealth, safety, and welfare or that enable the individual tofunction with greater independence in the home, and without whichthe individual would require institutionalization.

(2) "Environmental modifications" includes such adaptationsas installation of ramps and grab-bars, widening of doorways,modification of bathroom facilities, and installation ofspecialized electric and plumbing systems necessary to accommodatethe individual's medical equipment and supplies.

(3) "Environmental modifications" does not include physicaladaptations or improvements to the home that are of generalutility or not of direct medical or remedial benefit to theindividual, including such adaptations or improvements ascarpeting, roof repair, and central air conditioning.

(H) "Family support services" means the services providedunder a family support services program operated under section5126.11 of the Revised Code.

(I) "Habilitation" means the process by which the staff ofthe facility or agency assists an individual with mentalretardation or other developmental disability in acquiring andmaintaining those life skills that enable the individual tocopemore effectively with the demands of the individual's own personandenvironment, and in raising the level of the individual'spersonal, physical,mental, social, and vocational efficiency.Habilitation includes, but is notlimited to, programs of formal,structured education and training.

(J) "Habilitation center services" means servicesprovidedbya habilitation center certified by the department ofmentalretardation and developmental disabilities under section5123.041of the Revised Code and covered by the medicaid programpursuantto rules adopted under section 5111.041 of the RevisedCode.

(K) "Home and community-based services" meansmedicaid-funded home and community-based services specified in division (B)(1) of section 5111.87 of the Revised Code and provided under themedicaid waiver components the department of mental retardation anddevelopmental disabilities administers pursuant to section5111.871 of the Revised Code.

(L)(K) "Immediate family" means parents, brothers, sisters, spouses, sons, daughters, mothers-in-law, fathers-in-law, brothers-in-law, sisters-in-law, sons-in-law, and daughters-in-law.

(M)(L) "Medicaid" has the same meaning as in section 5111.01ofthe Revised Code.

(N)(M) "Medicaid case management services" means casemanagement services provided to an individual with mentalretardation or other developmental disability that the statemedicaid plan requires.

(O)(N) "Mental retardation" means a mental impairmentmanifested during the developmental period characterized bysignificantly subaverage general intellectual functioningexistingconcurrently with deficiencies in the effectiveness ordegree withwhich an individual meets the standards of personalindependenceand social responsibility expected of theindividual's age andcultural group.

(P)(O) "Residential services" means services to individualswith mental retardation or other developmental disabilities toprovide housing, food, clothing, habilitation, staff support, andrelated support services necessary for the health, safety, andwelfare of the individuals and the advancement of their qualityoflife."Residential services" includes program management, asdescribed in section 5126.14 of the Revised Code.

(Q)(P) "Resources" means available capital and other assets,including moneys received from the federal, state, and localgovernments, private grants, and donations; appropriatelyqualified personnel; and appropriate capital facilities andequipment.

(R)(Q) "Senior probate judge" means the current probate judge of a county who has served as probate judge of that county longer than any of the other current probate judges of that county. If a county has only one probate judge, "senior probate judge" means that probate judge.

(S)(R) "Service and support administration" means the dutiesperformed by a service and support administrator pursuant tosection 5126.15 of the Revised Code.

(T)(S)(1) "Specialized medical, adaptive, and assistiveequipment, supplies, and supports" means equipment, supplies, andsupports that enable an individual to increase the ability toperform activities of daily living or to perceive, control, orcommunicate within the environment.

(2) "Specialized medical, adaptive, and assistive equipment,supplies, and supports" includes the following:

(a) Eating utensils, adaptive feeding dishes, plate guards,mylatex straps, hand splints, reaches, feeder seats, adjustablepointer sticks, interpreter services, telecommunication devicesfor the deaf, computerized communications boards, othercommunication devices, support animals, veterinary care forsupport animals, adaptive beds, supine boards, prone boards,wedges, sand bags, sidelayers, bolsters, adaptive electricalswitches, hand-held shower heads, air conditioners, humidifiers,emergency response systems, folding shopping carts, vehicle lifts,vehicle hand controls, other adaptations of vehicles foraccessibility, and repair of the equipment received.

(b) Nondisposable items not covered by medicaid that areintended to assist an individual in activities of daily living orinstrumental activities of daily living.

(U)(T) "Supportive home services" means a range of servicestofamilies of individuals with mental retardation or otherdevelopmental disabilities to develop and maintain increasedacceptance and understanding of such persons, increased abilityoffamily members to teach the person, better coordinationbetweenschool and home, skills in performing specifictherapeutic andmanagement techniques, and ability to cope withspecificsituations.

(V)(U)(1) "Supported living" means services providedfor aslong as twenty-four hours a day to anindividual with mentalretardation or other developmentaldisability through any publicor private resources, includingmoneys from the individual, thatenhance the individual'sreputation in community life and advancethe individual's qualityof life by doing the following:

(a) Providing the support necessary to enable anindividualto live in a residence of the individual's choice, with anynumberof individuals who arenot disabled,or with not more thanthreeindividuals with mentalretardationand developmentaldisabilitiesunless the individualsare relatedby blood ormarriage;

(b) Encouraging the individual's participation in thecommunity;

(c) Promoting the individual's rights and autonomy;

(d)Assisting the individual in acquiring, retaining, andimprovingthe skillsand competencenecessary to live successfullyin theindividual's residence.

(2) "Supported living" includes the provision ofallof thefollowing:

(a) Housing, food,clothing, habilitation, staff support,professional services, andany related support services necessaryto ensure the health, safety,and welfare of the individualreceiving the services;

(b) A combination of life-long or extended-durationsupervision, training, and other services essential to dailyliving, including assessment and evaluation and assistance withthe cost of training materials, transportation, fees, andsupplies;

(c) Personal care services and homemaker services;

(d) Household maintenance that does not includemodifications to the physical structure of the residence;

(e) Respite care services;

(f) Program management, as described in section 5126.14 ofthe Revised Code.

Sec. 5126.035. (A) As used in this section:

(1) "Provider" means a person or government entity thatprovides services to an individual with mental retardation orother developmental disability pursuant to a service contract.

(2) "Service contract" means a contract between a countyboard of mental retardation and developmental disabilities and aprovider under which the provider is to provide services to anindividual with mental retardation or other developmentaldisability.

(B) Each service contract that a county board ofmentalretardation and developmental disabilities enters into withaprovidershall do all both of the following:

(1) Comply with rules adopted under division (E) of thissection;

(2) If the provider is to provide home and community-basedservices, or medicaid case management services, or habilitationcenter services, comply with all applicable statewide medicaidrequirements;

(3)(2) Include a general operating agreement component and anindividual service needs addendum.

(C) The general operating agreement component shallincludeall of the following:

(1) The roles and responsibilities of the county boardregarding services for individuals with mental retardation orother developmental disability who reside in the county the countyboard serves;

(2) The roles and responsibilities of the provider asspecified in the individual service needs addendum;

(3) Procedures for the county board to monitor theprovider's services;

(4) Procedures for the county board to evaluate the qualityof care and cost effectiveness of the provider's services;

(5) Procedures for payment of eligible claims;

(6) If the provider is to provide home and community-basedservices, or medicaid case management services, or habilitationcenter services, both of the following:

(a)Procedures for reimbursement that conform to thestatewide reimbursement process and the county board's plansubmitted under section 5126.054 of the Revised Code;

(b) Procedures that ensure that the county board pays thenonfederal share of the medicaid expenditures that the countyboard is required by division (A) of section5126.057 oftheRevised Code to pay.

(7) Procedures for the county board to perform serviceutilization reviews and the implementation of required correctiveactions;

(8) Procedures for the provider to submit claims forpaymentfor a service no later than three hundred thirty daysafter thedate the service is provided;

(9) Procedures for rejecting claims for payment that aresubmitted after the time required by division (B)(9)(C)(8) of thissection;

(10) Procedures for developing, modifying, and executinginitial and subsequent service plans. The procedures shallprovide for the provider's participation.

(11) Procedures for affording individuals due processprotections;

(12) General staffing, training, and certificationrequirements that are consistent with state requirements andcompensation arrangements that are necessary to attract, train,andretain competent personnel to deliver the services pursuant totheindividual service needs addendum;

(13) Methods to be used to document services provided andprocedures for submitting reports the county board requires;

(14) Methods for authorizing and documenting withinseventy-two hours changes to the individual service needsaddendum. The methods shall allow for changes to be initiallyauthorized verbally and subsequently in writing.

(15) Procedures for modifying the individual serviceneedsaddendum in accordance with changes to the recipient'sindividualized service plan;

(16) Procedures for terminating the individual serviceneedsaddendum within thirty days of a request made by therecipient;

(17) A requirement that all parties to the contract acceptthe contract's terms and conditions;

(18) A designated contact person and the method ofcontacting the designated person to respond to medical orbehavioral problems and allegations of major unusual incidents orunusual incidents;

(19) Procedures for ensuring the health and welfare of therecipient;

(20) Procedures for ensuring fiscal accountability and thecollection and reporting of programmatic data;

(21) Procedures for implementing the mediation andarbitration process under section 5126.036 of the Revised Code;

(22) Procedures for amending or terminating the contract,including as necessary to make the general operating agreementcomponent consistent with any changes made to the individualservice needs addendum;

(23) Anything else allowable under federal and state lawthat the county board and provider agree to.

(D) The individual service needs addendum shall beconsistent with the general operating agreement component andinclude all of the following:

(1) The name of the individual with mental retardation orother developmental disability who is to receive the services fromthe provider and any information about the recipient that theprovider needs to be able to provide the services;

(2) A clear and complete description of the services thatthe recipient is to receive as determined using statewideassessment tools;

(3) A copy of the recipient's assessment and individualizedservice plan;

(4) A clear and complete description of the provider'sresponsibilities to the recipient and county board in providingappropriate services in a coordinated manner with other providersand in a manner that contributes to and ensures the recipient'shealth, safety, and welfare.

(E) The director of mental retardation and developmentaldisabilities shall adopt rules in accordance with Chapter 119. ofthe Revised Code governing service contracts. A service contractdoes notnegate the requirement that a provider of home andcommunity-based services, or medicaid case management services, orhabilitation center services have a medicaid provideragreementwith the department of job and family services.

Sec. 5126.042.  (A) As used in this section, "emergency" means any situation that creates for anindividual with mental retardation or developmental disabilities arisk ofsubstantial self-harm or substantial harm to others ifaction is not takenwithin thirty days. An"emergency" mayinclude one or more of the followingsituations:

(1) Loss of present residence for any reason, includinglegalaction;

(2) Loss of present caretaker for any reason, includingseriousillness of the caretaker, change in the caretaker'sstatus, or inability ofthe caretaker to perform effectively forthe individual;

(3) Abuse, neglect, or exploitation of the individual;

(4) Health and safety conditions that pose a serious risk totheindividual or others of immediate harm or death;

(5) Change in the emotional or physical condition of theindividual that necessitates substantial accommodation that cannotbereasonably provided by the individual's existing caretaker.

(B) If a county board of mentalretardation anddevelopmental disabilities determines thatavailable resources arenot sufficient to meet the needs of allindividuals who requestprograms and services and may be offeredthe programs andservices, it shall establish waiting lists forservices. Theboard may establish priorities for making placements on itswaiting lists according to an individual's emergencystatusandshall establish priorities in accordance with divisions(D) and (E) of thissection.

The individuals who may be placed on a waiting list includeindividualswith a need for services on an emergencybasis andindividuals whohave requested services for whichresources arenot available.

Except for an individual who is to receive priority forservices pursuant to division (D)(3) of this section, anindividual who currently receives a service but would liketochangeto another service shall not be placed on a waiting listbut shall be placedon a service substitution list. Theboardshall work with the individual,service providers, and allappropriate entities to facilitate the change inservice asexpeditiously as possible. The board may establish priorities formaking placements on its service substitution listsaccording toanindividual's emergency status.

In addition to maintaining waiting lists and servicesubstitution lists,a board shall maintain a long-termserviceplanning registry for individualswho wish to record theirintentionto request in the future a service they are notcurrently receiving. Thepurpose of the registry is to enabletheboard to document requests and to plan appropriately. The boardmay notplace an individual on the registry who meets theconditions for receipt ofservices on an emergencybasis.

(C) A county board shall establish a separate waiting listfor each of the following categories of services, and mayestablish separate waiting lists within the waiting lists:

(1) Early childhood services;

(2) Educational programs for preschool and school agechildren;

(3) Adult services;

(4)Service and supportadministration;

(5) Residential services and supported living;

(6) Transportation services;

(7) Other services determined necessary and appropriateforpersons withmental retardation or a developmental disabilityaccording to theirindividual habilitation or service plans;

(8) Family support services provided under section 5126.11of the RevisedCode.

(D)Except as provided in division(G) of this section, acounty board shall do, as priorities, all of the following inaccordance with theassessment component, approved under section5123.046 of the Revised Code, of thecountyboard's plandevelopedunder section5126.054 of the RevisedCode:

(1) For the purpose of obtaining additional federalmedicaidfunds for home and community-based services, and medicaidcasemanagement services, and habilitation center services, doboth ofthe following:

(a) Give an individual who is eligible for home andcommunity-based services and meets both of the followingrequirements priority over any other individual on a waiting listestablished under division (C) of this section for home andcommunity-based services that include supported living,residential services, or family support services:

(i) Is twenty-two years of age or older;

(ii) Receives supported living or family support services.

(b) Give an individual who is eligible for home andcommunity-based services and meets both of the followingrequirements priority over any other individual on a waiting listestablished under division (C) of this section for home andcommunity-based services that include adult services:

(i) Resides in the individual's own home or the home of theindividual's family and will continue to reside in that home afterenrollment in home and community-based services;

(ii) Receives adult services from the county board.

(2) As federal medicaid funds become available pursuant todivision (D)(1) of this section, give anindividual who iseligible for home and community-based servicesand meets any ofthe following requirements priority for such services over anyother individual on a waiting list established under division (C)of this section:

(a) Does not receive residential services or supportedliving, either needs services in the individual's current livingarrangement or will need services in a new living arrangement, andhas a primary caregiver who is sixty years of age or older;

(b) Is less than twenty-two years of age and has at leastone of the followingservice needs that areunusual in scope orintensity:

(i) Severe behavior problems forwhich a behavior supportplan is needed;

(ii) An emotional disorder for which anti-psychoticmedication is needed;

(iii) A medical condition that leaves the individualdependent on life-support medical technology;

(iv) A condition affecting multiple body systems for whichacombination of specialized medical, psychological, educational,orhabilitation services are needed;

(v) A condition the county board determines to becomparablein severity to any condition described in division(D)(2)(b)(i)to(iv) of this section and places the individual atsignificantriskof institutionalization.

(c) Is twenty-two years of age or older, does not receiveresidential services or supported living, and is determinedbythecounty board to have intensive needs forhome andcommunity-basedserviceson an in-home or out-of-home basis.

(3) In fiscal years 2002 and 2003, give an individual whoiseligible for home and community-based services, resides in anintermediate care facility for thementally retarded or nursingfacility, chooses to move toanothersetting with the help ofhomeand community-based services, and has been determined by thedepartment of mental retardation and developmentaldisabilities tobe capable of residing inthe other setting, priority over anyother individual on a waiting list established under division (C)of this section for home and community-based services who does notmeet these criteria. The department of mental retardation anddevelopmental disabilities shall identify the individuals toreceive priority under division (D)(3) of this section, assess theneeds of the individuals, and notify the county boards that are toprovide the individuals priority under division (D)(3) of thissection of the individuals identified by the department and theindividuals' assessed needs.

(E) Except as provided in division (G) of this section and for a number of years and beginning on a date specified in rules adopted under division (K) of this section, a county board shall give an individual who is eligible for home and community-based services, resides in a nursing facility, and chooses to move to another setting with the help of home and community-based services, priority over any other individual on a waiting list established under division (C) of this section for home and community-based services who does not meet these criteria.

(F) If two or more individuals on a waiting list establishedunder division (C) of this section for home and community-basedservices have priority for the services pursuant to division(D)(1) or (2) or (E) of this section, a county board may use,untilDecember 31, 2005 2007, criteria specified in rules adopted underdivision (K)(2) of this section in determining the order in whichthe individuals with priority will be offered the services.Otherwise, the county board shall offer the home andcommunity-based services to such individuals in the order they areplaced on the waiting list.

(G)(1) No individual may receive priority for servicespursuant to division (D) or (E) of this section over an individualplacedon a waiting list established under division (C) of thissectionon an emergency status.

(2) No more thanfour hundred individuals in the statemayreceive priority for services duringthe 2004 2006 and 2005 2007bienniumpursuant to division (D)(2)(b) of thissection.

(3) No more than a total ofseventy-five individuals in thestate mayreceive priority forservices during state fiscal years2002 and2003 pursuant todivision (D)(3) of this section.

(4) No more than forty individuals in the state may receive priority for services pursuant to division (E) of this section for each year that priority category is in effect as specified in rules adopted under division (K) of this section.

(H) Prior to establishing any waiting list under thissection, a county board shall develop and implement a policy forwaiting lists that complies withthis section and rulesadoptedunder division (K) of thissection.

Prior to placing an individual on a waiting list, the countyboardshall assess the service needs of the individual inaccordancewith all applicable state and federal laws. The countyboardshall place the individual on the appropriate waiting listandmay place the individual on more than one waiting list.Thecounty board shall notify the individual of the individual'splacement and position on each waiting list on which theindividual is placed.

At least annually, the county board shall reassess theservice needs of each individual on a waiting list. If itdetermines that an individual no longer needs a program orservice, the county board shall remove the individual fromthewaiting list. If it determines that an individual needs a programorservice other than the one for which the individual is on thewaiting list,the county board shall provide the program orservice to theindividual or place the individual on a waitinglist for theprogram or service in accordance with the board'spolicy for waiting lists.

When a program or service for which there is a waiting listbecomes available, the county board shall reassess the serviceneeds of the individual next scheduled on the waiting list toreceive that program or service. If the reassessmentdemonstratesthat the individual continues to need the program orservice, theboard shall offer the program or service to theindividual. If itdetermines that an individual no longer needs a program orservice, the county board shall remove the individual from thewaiting list. If it determines that an individual needs a programor service other than theone for which the individual is on thewaiting list, thecounty board shall provide the program orservice to theindividual or place the individual on a waitinglist for the program orservice in accordance with the board'spolicy for waiting lists.The county board shall notify theindividual of the individual's placement and position on thewaiting list on which the individual is placed.

(I) A child subject to a determination made pursuant tosection121.38 of the Revised Code who requires the homeandcommunity-based services provided through amedicaid componentthat the department ofmental retardation and developmentaldisabilities administersundersection 5111.871 of theRevisedCode shallreceive services throughthatmedicaid component. Forall other services, a child subjectto adeterminationmadepursuant to section 121.38 of the Revised Codeshallbetreated asan emergency by the county boards and shallnot besubject to awaiting list.

(J) Not later than the fifteenth day ofMarch of eacheven-numbered year, each county boardshall prepare and submit tothe director of mentalretardation and developmental disabilitiesits recommendations for the fundingof services for individualswith mental retardation and developmentaldisabilities and itsproposals for reducing the waiting lists for services.

(K)(1) The department of mental retardation anddevelopmentaldisabilities shall adopt rules in accordance withChapter 119. ofthe Revised Code governing waiting listsestablished under thissection. The rules shall include proceduresto be followed toensure that the due process rights ofindividuals placed onwaiting lists are not violated.

(2) As part of the rules adopted under this division, thedepartment shall adopt rulesestablishing criteria a county board may use under division (F) ofthis section in determining the order in which individuals withpriority for home and community-based services will be offeredtheservices. The rules shall also specify conditions under whichacounty board, when there is no individual with priority for homeand community-based services pursuant to division (D)(1) or (2) or (E) ofthis section available and appropriate for the services,may offerthe services to an individual on a waiting list for theservicesbut not given such priority for the services. The rulesadoptedunder division (K)(2) of this section shall cease to haveeffectDecember 31, 2005 2007.

(3) As part of the rules adopted under this division, the department shall adopt rules specifying both of the following for the priority category established under division (E) of this section:

(a) The number of years, which shall not exceed five, that the priority category will be in effect;

(b) The date that the priority category is to go into effect.

(L) The following shall take precedence over theapplicableprovisions of this section:

(1) Medicaid rules and regulations;

(2) Any specific requirements that may be contained within amedicaidstate plan amendment or waiver program that a countyboard has authority toadminister or with respect to which it hasauthority to provide services,programs, or supports.

Sec. 5126.054.  (A) Each county board of mental retardationand developmental disabilities shall, by resolution, develop athree-calendar year plan that includes the followingfourcomponents:

(1) An assessment component that includes all of thefollowing:

(a) The number of individuals with mental retardation orother developmental disability residing in the county who need thelevel of care provided by an intermediate care facility for thementally retarded, may seek home and community-based services,aregiven priority for the services pursuant to division (D) ofsection 5126.042 of the Revised Code; the service needs of thoseindividuals; and the projectedannualized cost for services;

(b) The source of funds available to the county board to paythe nonfederal share of medicaid expenditures that the countyboard is required by division (A) of section5126.057 oftheRevised Code to pay;

(c) Any other applicable information or conditions that thedepartment of mental retardation and developmental disabilitiesrequires as a condition of approving thecomponent undersection5123.046 of the Revised Code.

(2) A component that provides for the recruitment,training,and retention of existing and new direct care staffnecessary toimplement services included in individualized serviceplans,including behavior management services and healthmanagementservices such as delegated nursing and otherhabilitationservices, and protect the health and welfareofindividualsreceiving services included in the individual'sindividualizedservice plan by complying with safeguards forunusual and majorunusual incidents, day-to-day programmanagement, and otherrequirements the department shall identify.A county board shalldevelop this component in collaboration withproviders ofmedicaid-funded services with which the county boardcontracts. Acounty board shall include all of the following inthe component:

(a) The source and amount of funds available for thecomponent;

(b) A plan and timeline for implementing the component withthe medicaid providers under contract with the county board;

(c) The mechanisms the county board shall use to ensure thefinancial and program accountability of the medicaid provider'simplementation of the component.

(3)A preliminary implementation component that specifies thenumber of individuals to be provided, during the first year thatthe planis in effect, home and community-based services pursuantto thepriority given to them under divisions (D)(1) and (2) ofsection5126.042 of the Revised Code and the types of home andcommunity-based services the individuals are to receive;

(4) A component that provides for the implementation ofhabilitation center services, medicaid case management services,and home and community-based services for individuals who begin toreceive the services on or after the date the plan is approvedunder section 5123.046 of the Revised Code. A county board shallinclude all of the following in the component:

(a) If the department of mental retardation anddevelopmental disabilities or department of job and familyservices requires, an agreement to pay the nonfederal share ofmedicaid expenditures that the county board is required bydivision (A) of section5126.057 of the Revised Code topay;

(b) How the services are to be phased in over the periodtheplan covers, including how the county board will serveindividualson a waiting list established under division (C) ofsection5126.042 who are given priority status under division(D)(1)ofthat section;

(c) Any agreement or commitment regarding the countyboard'sfunding of home and community-based services that thecounty boardhas with the department at the time the county boarddevelops thecomponent;

(d) Assurances adequate to the department that the countyboard will comply with all of the following requirements:

(i)To provide the types of home and community-based servicesspecified in the preliminary implementation component required bydivision (A)(3) of this section to at least the number ofindividuals specified in that component;

(ii) To use any additional funds the county board receivesfor the services to improve the county board's resourcecapabilities for supporting such services available in the countyat the time the component is developed and to expand the servicesto accommodate the unmet need for those services in the county;

(iii) To employ a business manager who is either a newemployee who has earned at least a bachelor's degree in businessadministration or a current employee who has the equivalentexperience of a bachelor's degree in business administration. Ifthe county board will employ a new employee, the county boardshall include in the component a timeline for employing theemployee.

(iv) To employ or contract with a medicaid servicesmanagerwho is either anew employee who has earned at least abachelor'sdegree or acurrent employee who has the equivalentexperience ofa bachelor'sdegree. If the county board willemploy a newemployee, thecounty board shall include in thecomponent atimeline foremploying the employee. Two or threecounty boardsthat have a combined total enrollment in countyboard services notexceeding one thousand individuals asdetermined pursuant tocertifications made under division (B) ofsection 5126.12 of theRevised Code may satisfy this requirementby sharing the servicesof a medicaid services manager or usingthe services of a medicaidservices manager employed by or undercontract with a regionalcouncil that the county boards establishunder section 5126.13 ofthe Revised Code.

(e) An agreement to comply with the method, developed byrules adopted undersection 5123.0413 of the Revised Code, ofpaying for extraordinary costs, including extraordinary costs forservices to individuals with mental retardation or otherdevelopmental disability, and ensuring the availability ofadequate funds in the event a county property tax levy forservices for individuals with mental retardation or otherdevelopmental disability fails;

(f) Programmatic and financial accountability measures andprojected outcomes expected from theimplementation of the plan;

(g) Any other applicable information or conditions that thedepartment requires as a condition of approving thecomponentundersection 5123.046 of the Revised Code.

(B) For the purpose of obtaining the department's approvalunder section 5123.046 of the Revised Code of the plan the countyboard develops under division (A) of this section, a county boardshall doall of the following:

(1) Submit the components required by divisions (A)(1) and(2) of this section to the department not later than August 1,2001;

(2)Submit the component required by division (A)(3) of thissection to the department not later than January 31, 2002;

(3) Submit the component required by division (A)(4) ofthissection to the department not later thanJuly 1,2002.

(C) A county board whose plan developed under division (A)of this section is approved by the department under section5123.046 of the Revised Code shall update and renew the plan inaccordance with a schedule the department shall develop.

Sec. 5126.055.  (A) Except as provided in section5126.056 of the Revised Code, a county board ofmental retardationanddevelopmental disabilities has medicaid localadministrativeauthority to, and shall,do all of the followingfor an individualwith mental retardationor other developmentaldisability whoresides in the county thatthe county board servesand seeks orreceives home andcommunity-based services:

(1) Perform assessments and evaluations of the individual.As part of theassessment and evaluation process, the county boardshall do allof the following:

(a) Make a recommendation to the department of mentalretardation and developmental disabilities on whether thedepartment should approve or deny the individual's application forthe services, including on the basis of whether the individualneeds the level of care an intermediate care facility for thementally retarded provides;

(b) If the individual's application is denied because of thecounty board's recommendation and the individual requests ahearing under section 5101.35 of the Revised Code, present, withthe department of mental retardation and developmentaldisabilities or department of job and family services, whicheverdenies the application, the reasons for the recommendation anddenial at the hearing;

(c) If the individual's application is approved, recommendto the departments of mental retardation and developmentaldisabilities and job and family services the services that shouldbe included in the individual's individualized service plan and,if either department approves, reduces, denies, or terminates aserviceincluded in the individual's individualized service planundersection 5111.871 of the Revised Code because of the countyboard'srecommendation, present, with the department that made theapproval, reduction, denial, or termination, the reasons for therecommendation and approval, reduction, denial, or termination ata hearingunder section 5101.35 of the Revised Code.

(2) If the individual has been identified by the departmentof mental retardation and developmental disabilities as anindividual to receive priority for home and community-basedservices pursuant to division (D)(3) of section 5126.042 of theRevised Code, assist the department in expediting the transfer ofthe individual from an intermediate care facility for the mentallyretarded or nursing facility to the home and community-basedservices;

(3)In accordance with the rules adopted under section5126.046 of the Revised Code, perform the county board's dutiesunder that section regarding assisting the individual's right tochoose a qualified and willing provider of the services and, at ahearing under section 5101.35 of the Revised Code, presentevidence of the process for appropriate assistance in choosingproviders;

(4) Unless the county board provides the services underdivision (A)(5) of this section, contract with the person orgovernment entity the individual chooses in accordance withsection 5126.046 of the Revised Code to provide the services ifthe person or government entity is qualified and agrees to providethe services. The contract shall contain all the provisionsrequired by section5126.035 of the Revised Code andrequire theprovider to agree tofurnish, in accordance with theprovider'smedicaid provideragreement and for the authorizedreimbursementrate, the servicesthe individual requires.

(5) If the county board is certified under section5123.045 5123.16of the Revised Code to provide the services and agrees toprovidethe services to the individual and the individual choosesthecounty board to provide the services, furnish, in accordancewiththe county board's medicaid provider agreement and for theauthorized reimbursement rate, the services the individualrequires;

(6) Monitor the services provided to the individual andensure the individual's health, safety, and welfare. Themonitoring shall include quality assurance activities. If thecounty board provides the services, the department of mentalretardation and developmental disabilities shall also monitor theservices.

(7) Develop, with the individual and the provider of theindividual's services, an effective individualized service planthat includes coordination of services, recommend that thedepartments of mental retardation and developmental disabilitiesand job and family services approve the plan, and implement theplan unless either department disapproves it;

(8) Have an investigative agent conduct investigations undersection 5126.313 of the Revised Code that concern the individual;

(9) Have a service and support administrator perform theduties under division (B)(9) of section 5126.15 of the RevisedCode that concern the individual.

(B) Except as provided in section5126.056 of the RevisedCode, acounty board has medicaid localadministrative authorityto, andshall, do all of thefollowingfor an individual withmentalretardation or otherdevelopmentaldisability who residesin thecounty that the countyboard servesand seeks or receivesmedicaidcase managementservices orhabilitation center services,otherthan habilitationcenterservices for which a schooldistrict isrequired bydivision (E)of section 5111.041 of theRevised Codeto pay thenonfederalshare:

(1) Perform assessments and evaluations of the individualfor the purpose of recommending to the departments of mentalretardation and developmental disabilities and job and familyservices the services that should be included in the individual'sindividualized service plan;

(2) If the department of mental retardation anddevelopmental disabilities or department of job and familyservices approves, reduces, denies, or terminates a serviceincluded in theindividual's individualized service plan undersection 5111.041 or5111.042 of the Revised Code because of thecounty board'srecommendation under division (B)(1) of thissection, present,with the department that made the approval,reduction, denial, ortermination, the reasons for therecommendation and approval, reduction,denial, or termination ata hearing under section 5101.35 of theRevised Code and inform theindividual that the individual mayfile a complaint with thecounty board under section 5126.06 ofthe Revised Code at the sametime the individual pursues an appealunder section 5101.35 of theRevised Code;

(3) In accordance with rules the departments of mentalretardation and developmental disabilities and job and familyservices shall adopt in accordance with Chapter 119. of theRevised Code governing the process for individuals to chooseproviders of medicaid case management services and habilitationcenter services, assist the individual in choosing the provider ofthe services. The rules shall provide for both of the following:

(a) The county board providing the individual up-to-dateinformation about qualified providers that the department ofmental retardation and developmental disabilities shall makeavailable to the county board;

(b) If the individual chooses a provider who is qualifiedand willing to provide the services but is denied that provider,the individual receiving timely notice that the individual mayrequest a hearing under section 5101.35 of the Revised Code and,at the hearing, the county board presenting evidence of theprocess for appropriate assistance in choosing providers.

(4) Unless the county board provides the services underdivision (B)(5) of this section, contract with the person orgovernment entity that the individual chooses in accordance withthe rules adopted under division (B)(3) of this section to providethe services if the person or government entity is qualified andagrees to provide the services. The contract shall contain allthe provisions required by section5126.035 of theRevised Codeand require theprovider to agree to furnish, inaccordance withthe provider'smedicaid provider agreement and forthe authorizedreimbursementrate, the services the individualrequires.

(5) If the county board is certified under section5123.041of the Revised Code to provide the services and agrees toprovidethe services to the individual and the individual choosesthecounty board to provide the services, furnish, in accordancewiththe county board's medicaid provider agreement and for theauthorized reimbursement rate, the services the individualrequires;

(6) Monitor the services provided to the individual. Themonitoring shall include quality assurance activities. If thecounty board provides the services, the department of mentalretardation and developmental disabilities shall also monitor theservices.

(7) Develop with the individual and the provider of theindividual's services, and with the approval of the departments ofmental retardation and developmental disabilities and job andfamily services, implement an effective plan for coordinating theservices in accordance with the individual's approvedindividualized service plan;

(8) Have an investigative agent conduct investigations undersection 5126.313 of the Revised Code that concern the individual;

(9) Have a service and support administrator perform theduties under division (B)(9) of section 5126.15 of the RevisedCode that concern the individual.

(C) A county board shall perform its medicaid localadministrativeauthority under this section in accordance with allof thefollowing:

(1) The county board's plan that the department of mentalretardation and developmental disabilities approves under section5123.046 of the Revised Code;

(2) All applicable federal and state laws;

(3) All applicable policies of the departments of mentalretardation and developmental disabilities and job and familyservices and the United States department of health and humanservices;

(4) The department of job and family services' supervisionunder its authority under section 5111.01 of the Revised Code toact as the single state medicaid agency;

(5) The department of mental retardation and developmentaldisabilities' oversight.

(D)(C) The departments of mental retardation and developmentaldisabilities and job and family services shall communicate withand provide training to county boards regarding medicaid localadministrative authority granted by this section. Thecommunication and training shall include issues regarding auditprotocols and other standards established by the United Statesdepartment of health and human services that the departmentsdetermine appropriate for communication and training. Countyboards shall participate in the training. The departments shallassess the county board's compliance against uniform standardsthat the departments shall establish.

(E)(D) A county board may not delegate its medicaid localadministrative authority granted under this section but maycontract with a person or government entity, including a councilof governments, for assistance with its medicaid localadministrativeauthority. A county board that enters into such acontract shallnotify the director of mental retardation anddevelopmentaldisabilities. The notice shall include the tasksandresponsibilities that the contract gives to the person orgovernment entity. The person or government entity shall complyin full with all requirements to which the county board is subjectregarding the person or government entity's tasks andresponsibilities under the contract. The countyboard remainsultimately responsible for the tasks and responsibilities.

(F)(E) A county board that has medicaid local administrativeauthorityunder this section shall, through the departments ofmentalretardation and developmental disabilities and job andfamilyservices, reply to, and cooperate in arranging compliancewith, aprogram or fiscal audit or program violation exceptionthat astate or federal audit or review discovers. The departmentof joband family services shall timely notify the department ofmentalretardation and developmental disabilities and the countyboard ofany adverse findings. After receiving the notice, thecountyboard, in conjunction with the department of mentalretardationand developmental disabilities, shall cooperate fullywith thedepartment of job and family services and timely prepareand sendto the department a written plan of correction orresponse to theadverse findings. The county board is liable forany adversefindings that result from an action it takes or failsto take inits implementation of medicaid local administrativeauthority.

(G)(F) If the department of mental retardation anddevelopmental disabilities or department of job and familyservices determines that a county board's implementation of itsmedicaid local administrative authority under this section isdeficient,the department that makes the determination shallrequire thatcounty board do the following:

(1) If the deficiency affects the health, safety, orwelfareof an individual with mental retardation or otherdevelopmentaldisability, correct the deficiency withintwenty-four hours;

(2) If the deficiency does not affect the health, safety,orwelfare of an individual with mental retardation or otherdevelopmental disability, receive technical assistance from thedepartment or submit a plan of correction to thedepartment thatis acceptable to the department within sixty daysand correct thedeficiency within the time required by the plan ofcorrection.

Sec. 5126.056. (A) The department of mental retardation anddevelopmental disabilities shall take action under division (B) ofthis section against a county board of mental retardation anddevelopmental disabilities if any of the following are the case:

(1) The county board fails to submit to the department allthe components of its three-year plan required by section 5126.054of the Revised Code within the time required by division (B) ofthat section.

(2) The department disapproves the county board'sthree-yearplan under section 5123.046 of the Revised Code.

(3) The county board fails, as required by division (C) ofsection 5126.054 of the Revised Code, to update and renew itsthree-year plan in accordance with a schedule the departmentdevelops under that section.

(4) The county board fails to implement its initial orrenewed three-year plan approved by the department.

(5) The county board fails to correct a deficiency withinthe time required by division (G)(F) of section 5126.055 of theRevised Code to the satisfaction of the department.

(6) The county board fails to submit an acceptable plan ofcorrection to the department within the time required by division(G)(F)(2) of section 5126.055 of the Revised Code.

(B) If required by division (A) of this section to takeaction against a county board, the department shall issue an orderterminating the county board's medicaid local administrativeauthority over all or part of home and community-based services,medicaid case management services, habilitation center services,all or part of two of those services, or all or part of all three bothof those services. The department shall provide a copy of theorder to the board of county commissioners, senior probate judge, countyauditor, and president and superintendent of the county board.Thedepartment shall specify in the order the medicaid localadministrative authority that the department is terminating, thereason for the termination, and the county board's option andresponsibilities under this division.

A county board whose medicaid local administrative authorityis terminated may, not later than thirty days after the departmentissues the termination order, recommend to the department thatanother county board that has not had any of its medicaid localadministrative authority terminated or another entity thedepartment approves administer the services for which the countyboard's medicaid local administrative authority is terminated.Thedepartment may contract with the other county board or entitytoadminister the services. If the department enters into such acontract, the county board shall adopt a resolution giving theother county board or entity full medicaid local administrativeauthority over the services that the other county board or entityis to administer. The other county board or entity shall be knownas the contracting authority.

If the department rejects the county board's recommendationregarding a contracting authority, the county board may appeal therejection under section 5123.043 of the Revised Code.

If the county board does not submit a recommendation to thedepartment regarding a contracting authority within the requiredtime or the department rejects the county board's recommendationand therejection is upheld pursuant to an appeal, if any, undersection5123.043 of the Revised Code,the department shall appointan administrative receiver toadminister the services for whichthe county board's medicaidlocal administrative authority isterminated. To the extentnecessary for the department to appointan administrativereceiver, the department may utilize employeesof the department,management personnel from another county board,or otherindividuals who are not employed by or affiliated with inanymanner a person that provides home andcommunity-basedservices, ormedicaid case management services, orhabilitationcenter servicespursuant to a contract with anycounty board. Theadministrativereceiver shall assume fulladministrativeresponsibility for thecounty board's services forwhich thecounty board's medicaidlocal administrative authorityisterminated.

The contracting authority or administrative receiver shalldevelop and submit to the department a plan of correction toremediate the problems that caused the department to issue thetermination order. If, after reviewing the plan, the departmentapproves it, the contracting authority or administrative receivershall implement the plan.

The county board shall transfer control of state and federalfunds it is otherwise eligible to receive for the services forwhich the county board's medicaid local administrative authorityis terminated and funds the county board may use under division(B) of section 5126.057 of the Revised Code to pay the nonfederalshare of the services that the county board is required bydivision (A) of that section to pay. The county board shalltransfer control of the funds to the contracting authority oradministrative receiver administering the services. The amountthe county board shall transfer shall be the amount necessary forthe contracting authority or administrative receiver to fulfillits duties in administering the services, including its duties topay its personnel for time worked, travel, and related matters.Ifthe county board fails to make the transfer, the department maywithhold the state and federal funds from the county board andbring a mandamus action against the county board in the court ofcommon pleas of the county served by the county board or in theFranklin county court of common pleas. The mandamus action maynot require that the county board transfer any funds other thanthe funds the county board is required by division (B) of thissection totransfer.

The contracting authority or administrative receiver has theright to authorize the payment of bills in the same manner thatthe county board may authorize payment of bills under this chapterand section 319.16 of the Revised Code.

Sec. 5126.057. (A) A county board of mentalretardation anddevelopmental disabilities that has medicaid localadministrativeauthorityunder division (A) of section 5126.055 ofthe RevisedCode forhome and community-based services shall paythenonfederal share ofmedicaid expenditures for such servicesprovided to an individualwith mental retardation or otherdevelopmental disability who thecounty board determines undersection 5126.041 of the Revised Codeis eligible for county boardservices unless division (C)(B)(2) or (3) of section 5123.047 of the RevisedCode requires the department of mental retardation anddevelopmental disabilities to pay the nonfederal share.

A county board that has medicaid local administrativeauthority underdivision (B) of section 5126.055 of the RevisedCode for provides medicaidcase management services shall pay thenonfederal share ofmedicaid expenditures for such servicesprovided to an individualwith mental retardation or otherdevelopmental disability who thecounty board determines undersection 5126.041 of the Revised Codeis eligible for county boardservices unless division (B)(2) ofsection 5123.047 of the RevisedCode requires the department ofmental retardation anddevelopmental disabilities to pay thenonfederal share.

A county board shall pay the nonfederal share of medicaidexpenditures for habilitation center services when required to doso by division (D) of section 5111.041 of the Revised Code.

(B) A county board may use the following funds to pay thenonfederal share of the services that the county board is requiredby division (A) of this section to pay:

(1) To the extent consistent with the levy that generatedthe taxes, the following taxes:

(a) Taxes levied pursuant to division (L) of section 5705.19of the Revised Code and section 5705.222 of the Revised Code;

(b) Taxes levied under section 5705.191 of the Revised Codethat the board of county commissioners allocates to the countyboard to pay the nonfederal share of the services.

(2) Funds that the department of mental retardation anddevelopmental disabilities distributes to the county board undersections 5126.11, 5126.12, 5126.15, 5126.18, and 5126.44 of theRevised Code;

(3) Funds that the department allocates to the county boardfor habilitation center services provided under section 5111.041of the Revised Code;

(4) Earned federal revenue funds the county board receivesfor medicaid services the county board provides pursuant to thecounty board's valid medicaid provider agreement.

(C) If by December 31, 2001, the United States secretary ofhealth and human services approves at least five hundredmoreslots for home and community-basedservices for calendar year 2002than were available for calendar year 2001, each county boardshallprovide, by the last day of calendar year 2001, assurancesto thedepartment of mental retardationand developmentaldisabilitiesthat the county board will have for calendar year2002 at leastone-third of the value of one-half, effective milllevied in thecounty the preceding year available to pay thenonfederal shareoftheservices that the county board is requiredby division (A)ofthissection to pay.

If by December 31, 2002, the United States secretary approvesat least five hundred more slots for home and community-basedservices for calendar year 2003 than were available for calendaryear 2002, each county board shall provide, by the last day ofcalendar year 2002, assurances to the department that the countyboard will have for calendar year 2003 at least two-thirds of thevalue of one-half, effective mill levied in the county thepreceding year available to pay the nonfederal share of theservices that the county board is required by division (A) of thissection to pay.

If by December 31, 2003, the United States secretary approvesat least five hundred more slots for home and community-basedservices for calendar year 2004 than were available for calendaryear 2003, each county board shall provide, by the last day ofcalendar year 2003 and each calendar year thereafter, assurancesto the department that the county board will have for calendaryear 2004 and each calendar year thereafter at least the value ofone-half, effective mill levied in the county the preceding yearavailable to pay the nonfederal share of the services that thecounty board is required by division (A) of this section to pay.

(D) Each year, each county board shall adopt a resolutionspecifying the amount of funds it will use in the next year to paythe nonfederal share of the services that the county board isrequired by division (A) of this section to pay. The amountspecified shall be adequate to assure that the services will beavailable in the county in a manner that conforms to allapplicable state and federal laws. A county board shall state inits resolution that the payment of the nonfederal share representsan ongoing financial commitment of the county board. A countyboard shall adopt the resolution in time for the county auditor tomake the determination required by division (E) of this section.

(E) Each year, a county auditor shall determine whether theamount of funds a county board specifies in the resolution itadopts under division (D) of this section will be available in thefollowing year for the county board to pay the nonfederal share ofthe services that the county board is required by division (A) ofthis section to pay. The county auditor shall make thedetermination not later than the last day of the year before theyear in which the funds are to be used.

Sec. 5126.12.  (A) As used in this section:

(1)"Approved school ageclass" means a classoperated by acounty board ofmentalretardation and developmentaldisabilitiesandfunded by thedepartment ofeducation under section3317.20of theRevised Code.

(2)"Approved preschool unit" means a class or unit operatedby acounty board of mental retardation and developmentaldisabilities and approved underdivision (B) of section 3317.05of the Revised Code.

(3)"Active treatment" means a continuous treatmentprogram,which includes aggressive, consistent implementation ofa programof specialized and generic training, treatment, healthservices,and related services, that is directed toward theacquisition ofbehaviors necessary for an individual with mental retardationorother developmental disability to function withas muchself-determination and independence as possible andtoward theprevention of deceleration, regression, or loss ofcurrent optimalfunctional status.

(4)"Eligible for active treatment" means that anindividualwithmental retardation or other developmental disability residesin anintermediate care facility for the mentally retardedcertifiedunder Title XIX of the"Social Security Act," 79 Stat.286 (1965), 42 U.S.C. 1396, as amended; resides in a stateinstitutionoperated by the department of mental retardation anddevelopmental disabilities; or is enrolled in home andcommunity-based services.

(5)"Community alternative funding system" means theprogramunder which habilitationcenter services are reimbursed underthemedicaid program pursuant to section 5111.041ofthe RevisedCodeand rules adopted under that section.

(6) "Traditional adult services" means vocational andnonvocational activities conducted within a sheltered workshop oradult activity center or supportive home services.

(B) Each county board of mental retardation anddevelopmental disabilities shall certify to the director ofmentalretardation and developmental disabilities all of the following:

(1) On or before the fifteenth day of October, the averagedailymembership for the first full week of programs and servicesduring October receiving:

(a) Early childhood services provided pursuant to section5126.05 of the Revised Code for children who are less than threeyears of age on the thirtieth day of September of the academicyear;

(b) Special education for handicapped children in approvedschool ageclasses;

(c) Adult services for persons sixteen years of age andolder operated pursuant to section 5126.05 and division (B) ofsection 5126.051 of the Revised Code. Separate counts shall bemade forthe following:

(i) Persons enrolled in traditional adult services who areeligible for but not enrolled in active treatment under thecommunity alternative funding system;

(ii) Persons enrolled in traditional adult services whoareeligible for and enrolled in active treatment under thecommunityalternative funding system;

(iii) Persons enrolled in traditional adult services butwhoare not eligible for active treatment under the communityalternative funding system;

(iv) Persons participating in community employmentservices.To be counted as participating in community employmentservices, aperson must have spent an average of no less thanten hours perweek in that employmentduring the preceding sixmonths.

(d) Other programs in the county for individuals with mentalretardation and developmental disabilities that have been approvedforpayment of subsidy by the department of mental retardation anddevelopmental disabilities.

The membership in each such program and service in thecountyshall be reported on forms prescribed by the department ofmentalretardation and developmental disabilities.

The department of mental retardation and developmentaldisabilities shall adopt rules defining full-time equivalentenrollees and for determining theaverage daily membershiptherefrom, except thatcertificationof average daily membershipin approved school ageclasses shall bein accordance withrulesadopted by the state board of education. The average dailymembership figure shall be determined by dividing the amountrepresenting the sum of the number of enrollees in each program orservice in the week for which the certificationis made by thenumber of days the program orservice wasofferedin that week.Noenrollee may be counted in average dailymembership for morethanone program or service.

(2) By the fifteenth day of December, the number of childrenenrolled in approved preschool units on the first day of December;

(3) On or before the thirtieth dayof March, an itemizedreportof all income and operating expenditures for theimmediatelypreceding calendar year, in the format specified bythe department ofmentalretardation and developmentaldisabilities;

(4) By the fifteenth day of February, a report of thetotalannual cost per enrollee for operation ofprograms and services inthe preceding calendar year. The reportshall include a grandtotal of all programs operated, the cost ofthe individualprograms, and the sources of funds applied to eachprogram.

(5) That each required certification and report is inaccordance with rules established by the department of mentalretardation and developmental disabilities and the state board ofeducation for the operation and subsidization of the programs andservices.

(C) To compute payments under this section to the boardforthe fiscal year, the department of mental retardation anddevelopmental disabilities shall use thecertification ofaveragedaily membership required by division (B)(1) of thissectionexclusive of the average daily membership in any approvedschoolageclass and the number in any approved preschoolunit.

(D) The department shall pay each county board for eachfiscalyear an amount equal to nine hundred fifty dollarstimesthecertified number of persons who on thefirst day of Decemberof the academic year are under threeyears of age and are not inan approved preschoolunit. For persons who areat least agesixteen and are not in an approved school ageclass, thedepartment shall payeach county board for each fiscal year thefollowing amounts:

(1) One thousand dollars times the certified average dailymembership of persons enrolled in traditional adult services whoare eligible for but not enrolled in active treatment under thecommunity alternative funding system;

(2) One thousand two hundred dollars times the certifiedaverage daily membership of persons enrolled in traditional adultservices who are eligible for and enrolled in active treatmentunder the community alternative funding system;

(3) No less than one thousand five hundred dollars timesthecertified average daily membership of persons enrolled intraditional adult services but who are not eligible for activetreatment under the community alternative funding system;

(4) No less than one thousand five hundred dollars timesthecertified average daily membership of persons participatingincommunity employment services.

(E) The department shall distribute this subsidy to countyboards in quarterly installments of equal amounts. Theinstallments shall be made not laterthan the thirtieth day of September, the thirty-first day of December, the thirty-first day of March, and the thirtieth day of June.

(F) The director of mental retardation and developmentaldisabilities shall make efforts to obtain increases in thesubsidies for early childhood services and adult services so thatthe amount of the subsidies is equal to at least fifty per centofthe statewide average cost of those services minus anyapplicablefederal reimbursements for those services. Thedirector shalladvise the director of budget and management ofthe need for anysuch increases when submitting the biennialappropriations requestfor the department.

(G) In determining the reimbursement of a county board forthe provision ofservice and supportadministration, familysupportservices, andother servicesrequired or approved by thedirector for whichchildren threethrough twenty-one years of ageare eligible, thedepartment shallinclude the average dailymembership in approvedschool age orpreschool units. Thedepartment, in accordance withthissectionand upon receipt andapproval of the certificationrequiredbythis section and anyother information it requires toenable it todetermine a board'spayments, shall pay the agencyproviding thespecialized trainingthe amounts payable under thissection.

Sec. 5139.01.  (A) As used in this chapter:

(1)"Commitment" means the transfer of the physicalcustodyof a child or youth from the court to the department ofyouthservices.

(2)"Permanent commitment" means a commitment that vestslegal custody of a child in the department of youth services.

(3)"Legal custody," insofar as it pertains to the statusthat is created when a child is permanently committed to thedepartment of youth services, means a legal status in which thedepartment has the following rights and responsibilities: theright to have physical possession of the child; the right anddutyto train, protect, and control the child; theresponsibility toprovide the child with food, clothing, shelter, education,andmedicalcare; and the right to determine where and with whom thechild shalllive, subject to the minimum periods of, or periodsof,institutional careprescribed in sections 2152.13 to2152.18of the Revised Code; provided,that these rights andresponsibilities are exercised subject tothe powers, rights,duties, and responsibilities of the guardianof the person of thechild, and subject to any residual parentalrights andresponsibilities.

(4) Unless the context requires a different meaning,"institution" means a state facility that is created by thegeneralassembly and that is under the management and control ofthedepartment of youth services or a private entity with whichthe department hascontracted for the institutional care andcustody of felony delinquents.

(5)"Full-time care" means care for twenty-four hours adayfor over a period of at least two consecutive weeks.

(6)"Placement" means the conditional release of a childunder the terms and conditions that are specified by thedepartment of youth services. The department shall retain legalcustody of a child released pursuant to division (C) of section2152.22 of the Revised Code or division (C) of section5139.06 ofthe Revised Code until the time that it discharges the child oruntil the legal custody is terminated as otherwise provided bylaw.

(7)"Home placement" means the placement of a child in thehome of the child's parent or parents or in the home of theguardian ofthe child's person.

(8)"Discharge" means that the department of youthservices'legal custody of a child is terminated.

(9)"Release" means the termination of a child's stay inaninstitution and the subsequent period during which the childreturns to thecommunity under the terms and conditions ofsupervised release.

(10)"Delinquent child" has the same meaning as in section2152.02 of the Revised Code.

(11)"Felony delinquent" means any child who is at least ten years of age but less than eighteen years of age and whoisadjudicated a delinquent child for having committed an actthat ifcommitted by an adult would be a felony."Felonydelinquent"includes any adult who is between the ages ofeighteen andtwenty-one and who is in the legal custody of thedepartment ofyouth services for having committed an act that ifcommitted by anadult would be a felony.

(12)"Juvenile traffic offender" has the same meaning asinsection 2152.02 of the Revised Code.

(13)"Public safety beds" means all of the following:

(a) Felony delinquents who have been committed to thedepartment ofyouth services for the commission of an act, otherthan a violationof section 2911.01 or 2911.11 of the RevisedCode, that is a categoryone offense or a category two offenseandwho are in the care and custody of an institution or have beendivertedfrom care and custody in an institution and placed in acommunity correctionsfacility;

(b) Felony delinquents who, while committed to thedepartment of youthservices and in the care and custody of aninstitution or a communitycorrections facility, are adjudicateddelinquent children for havingcommittedin that institution orcommunity corrections facility an act that ifcommitted by anadult would be a misdemeanor or a felony;

(c) Children who satisfy all of the following:

(i) They are at least ten years of age but lessthaneighteen years of age.

(ii) They are adjudicated delinquentchildren for havingcommitted acts that if committed by anadult would be a felony.

(iii) They are committed to the department ofyouth servicesby the juvenile court of a county that has hadone-tenth of oneper cent or less of the statewide adjudicationsfor felonydelinquents as averaged for thepastfour fiscal years.

(iv) They are in the care and custody of an institution or acommunitycorrections facility.

(d) Felony delinquents who, while committed to thedepartment of youthservices and in the care and custody of aninstitution areserving disciplinary timeforhavingcommitted an act described in division (A)(19)(18)(a), (b), or (c) of this section, and who have been institutionalizedor institutionalizedin a secure facility for the minimum periodof time specified in divisions (A)(1)(b) to(e) of section2152.16 of the Revised Code.

(e) Felony delinquents who are subject to and serving athree-yearperiod of commitment order imposed by a juvenile courtpursuantto divisions (A) and (B) ofsection 2152.17 of theRevised Code for an act, other than a violation ofsection 2911.11of the Revised Code, that would be a category oneoffense orcategory two offense if committed by an adult.

(f) Felony delinquents who are described in divisions(A)(13)(a) to (e)of this section, who have been granted ajudicial release to courtsupervision underdivision (B) ofsection 2152.22of the Revised Code or a judicial release to thedepartment of youth services supervision underdivision (C) ofthat sectionfrom the commitment to the department of youthservices for theact described in divisions (A)(13)(a) to (e)ofthis section, who have violated the terms and conditions ofthatrelease, and who, pursuant to anorder of the court of the countyin which the particular felonydelinquent was placed on releasethat is issued pursuant todivision (D) of section 2152.22of theRevised Code, have been returned to thedepartment forinstitutionalization or institutionalization in asecure facility.

(g) Felony delinquents who have beencommitted to thecustody of the department of youth services,who have been grantedsupervised release from the commitmentpursuant to section 5139.51of theRevised Code, who have violated theterms and conditions ofthat supervised release, and who, pursuantto an order of thecourt of the county in which the particularchild was placed onsupervised release issued pursuant todivision (F) of section5139.52of the Revised Code, have had the supervisedreleaserevoked and have been returned to the department forinstitutionalization. A felony delinquent described in thisdivisionshall be a public safety bed only for the time duringwhich thefelony delinquent is institutionalized as a result ofthe revocationsubsequent to the initial thirty-day period ofinstitutionalization required by division (F) of section 5139.52of the Revised Code.

(14) Unless the context requires a different meaning,"community corrections facility" means a county or multicountyrehabilitation center for felony delinquents who have beencommitted to the department of youth services and diverted fromcare and custody in an institution and placed in therehabilitation center pursuant to division (E) of section 5139.36of the Revised Code.

(15)"Secure facility" means any facility that is designedand operated toensure that all of its entrances and exits areunder the exclusive control ofits staff and to ensure that,because of that exclusive control, no child whohas beeninstitutionalized in the facility may leave the facility withoutpermission or supervision.

(16)"Community residential program" means a program thatsatisfies both ofthe following:

(a) It is housed in a building or other structure that hasno associatedmajor restraining construction, including, but notlimited to, a securityfence.

(b) It provides twenty-four-hour care, supervision, andprograms for felonydelinquents who are in residence.

(17)"Category one offense" and"category two offense" havethe samemeaningsas in section 2151.26 of the Revised Code.

(18)"Disciplinary time" meansadditional time that thedepartment of youth servicesrequires a felony delinquent to servein an institution, thatdelays the felony delinquent'splanned release, and thatthedepartment imposes upon the felony delinquent following theconduct of an internal dueprocess hearing forhaving committed any of the following actswhile committed tothe department and in the care and custody ofaninstitution:

(a) An act that if committed by anadult would be a felony;

(b) An act that if committed by anadult would be amisdemeanor;

(c) An act that is not described in division (A)(18)(a)or(b) of this section and that violates aninstitutional rule ofconduct of the department.

(19)"Unruly child" has the same meaning as in section2151.022 of the Revised Code.

(20)"Revocation" means the act of revoking a child'ssupervised release for a violation of a term or condition of thechild's supervised release in accordance with section 5139.52ofthe Revised Code.

(21)"Release authority" means the release authorityof thedepartment of youth services that is established by section5139.50 of the Revised Code.

(22)"Supervised release" means the event of therelease ofachild under this chapter from an institution and the periodafterthat release during which the child is supervised andassistedbyan employee of the department of youth services underspecificterms andconditions for reintegration of the child intothecommunity.

(23)"Victim" means the person identified in a policereport,complaint, or information as the victim of an actthatwould havebeen a criminal offense if committed by an adultandthat providedthe basis for adjudication proceedingsresulting ina child'scommitment to the legal custody of thedepartment ofyouthservices.

(24)"Victim's representative" means a member of thevictim'sfamily or another person whom the victim or anotherauthorizedpersondesignates in writing,pursuant to section5139.56 of theRevised Code, torepresent the victim with respectto proceedingsof the releaseauthority of the department of youthservices andwith respect to othermatters specified in thatsection.

(25)"Member of the victim's family" means a spouse,child,stepchild, sibling, parent, stepparent, grandparent, otherrelative,or legal guardian of a child but does not include aperson chargedwith, convicted of, or adjudicated a delinquentchild for committing acriminal or delinquent act against thevictim or another criminal ordelinquent act arisingout of thesame conduct, criminal or delinquent episode, or plan as thecriminal or delinquent act committed against the victim.

(26)"Judicial release to court supervision" meansa releaseof achildfrom institutional care or institutional care in asecure facilitythat is granted by a court pursuant to division(B) of section 2152.22 of the Revised Code during theperiodspecified in thatdivision.

(27)"Judicial release todepartment of youth servicessupervision" means a release of a child frominstitutional care orinstitutional care in a secure facilitythat is granted by a courtpursuant to division (C) of section 2152.22 of theRevised Codeduring the period specified in that division.

(28) "Juvenile justice system"includes all of the functionsof the juvenile courts, thedepartment of youth services, anypublic or private agency whosepurposes include the prevention ofdelinquency or the diversion,adjudication, detention, orrehabilitation of delinquent children,and any of the functions ofthe criminal justice system that areapplicable to children.

(29) "Metropolitan county criminal justice services agency"means an agency that is established pursuant to division (A) ofsection 181.54 5502.64 of the Revised Code.

(30) "Administrative planning district" means a district thatis established pursuant to division (A) or (B) of section 181.56 5502.66of the Revised Code.

(31) "Criminal justice coordinating council" means a criminaljustice services agency that is established pursuant to division(D) of section 181.56 5502.66 of the Revised Code.

(32)"Comprehensive plan" means a document thatcoordinates,evaluates, and otherwise assists, on an annual ormulti-yearbasis,all of the functions of the juvenilejusticesystems of thestate or a specified area of thestate,thatconforms to thepriorities of the state with respecttojuvenile justice systems,and that conforms withtherequirements of all federal criminaljustice acts. Thesefunctions include, but are not limited to,all of thefollowing:

(a) Delinquency;

(b) Identification, detection, apprehension, and detentionof persons charged with delinquent acts;

(c) Assistance to crime victims or witnesses, except thatthe comprehensive plan does not include the functions of theattorney general pursuant to sections 109.91 and 109.92 of theRevised Code;

(d) Adjudication or diversion of persons charged withdelinquent acts;

(e) Custodial treatment of delinquentchildren;

(f) Institutional and noninstitutional rehabilitation ofdelinquent children.

(B) There is hereby created the department of youthservices. The governor shall appoint the director of thedepartment with the advice and consent of the senate. Thedirector shall hold office during the term of the appointinggovernor but subject to removal at the pleasure of the governor.Except as otherwise authorized in section 108.05 of the RevisedCode, the director shall devote the director's entire timeto theduties ofthe director's office and shall hold no other office orposition of trust orprofit during the director's term of office.

The director is the chief executive and administrativeofficer of the department and has all the powers of a departmenthead set forth in Chapter 121. of the Revised Code. Thedirectormay adoptrules for the government of the department, the conductof itsofficers and employees, the performance of its business,and thecustody, use, and preservation of the department'srecords,papers, books, documents, and property. The directorshall be anappointing authority within the meaning of Chapter124. of theRevised Code. Whenever this or any other chapter orsection ofthe Revised Code imposes a duty on or requires anaction of thedepartment, the duty or action shall be performed bythe directoror, upon the director's order, in the name of thedepartment.

Sec. 5139.36.  (A) In accordance with this section and therules adopted under it and from funds appropriated to thedepartment of youth services for the purposes of this section,the department shall make grants that provide financial resourcesto operate community corrections facilities for felonydelinquents.

(B)(1) Each community corrections facility that intends toseek a grant under this section shall file an application withthe department of youth services at the time and in accordancewith the procedures that the department shall establish by rulesadopted in accordance with Chapter 119. of the Revised Code. Inaddition to other items required to be included in theapplication, a plan that satisfies both of the following shall beincluded:

(a) It reduces the number of felony delinquents committedto the department from the county or counties associated with thecommunity corrections facility.

(b) It ensures equal access for minority felonydelinquents to the programs and services for which a potentialgrant would be used.

(2) The department of youth services shall review eachapplication submitted pursuant to division (B)(1) of this sectionto determine whether the plan described in that division, thecommunity corrections facility, and the application comply withthis section and the rules adopted under it.

(C) To be eligible for a grant under this section and forcontinued receipt of moneys comprising a grant under thissection, a community corrections facility shall satisfy at leastall of the following requirements:

(1) Be constructed, reconstructed, improved, or financedby the Ohio building authority pursuant to section 307.021 of theRevised Code and Chapter 152. of the Revised Code for the use ofthe department of youth services and be designated as a communitycorrections facility;

(2) Have written standardized criteria governing the typesof felony delinquents that are eligible for the programs andservices provided by the facility;

(3) Have a written standardized intake screening processand an intake committee that at least performs both of thefollowing tasks:

(a) Screens all eligible felony delinquents who are beingconsidered for admission to the facility in lieu of commitment tothe department;

(b) Notifies, within ten days after the date of thereferral of a felony delinquent to the facility, the committingcourt whether the felony delinquent will be admitted to thefacility.

(4) Comply with all applicable fiscal and program rulesthat the department adopts in accordance with Chapter 119. of theRevised Code and demonstrate that felony delinquents served bythe facility have been or will be diverted from a commitment tothe department.

(D) The department of youth services shall determine themethod of distribution of the funds appropriated for grants underthis section to community corrections facilities.

(E)(1) The department of youth services shall adopt rules in accordance with Chapter 119. of the Revised Code to establish the minimum occupancy threshold of community corrections facilities.

(2) The department may make referrals for the placement of children in its custody to a community corrections facility if the community corrections facility is not meeting the minimum occupancy threshold established by the department. At least forty-five days prior to the referral of a child or within any shorter period prior to the referral of the child that the committing court may allow, the department shall notify the committing court of its intent to place the child in a community corrections facility. The court shall have thirty days after the receipt of the notice to approve or disapprove the placement. If the court does not respond to the notice of the placement within that thirty-day period, the department shall proceed with the placement and debit the county in accordance with sections 5139.41 to 5139.43 of the Revised Code. A child placed in a community corrections facility pursuant to this division shallremain in the legal custody of thedepartment of youth services during the period in which the child is in the community corrections facility.

(3) Counties that are not associated with a community corrections facility may refer children to a community corrections facility with the consent of the facility. The department of youth services shall debit the county that makes the referral in accordance with sections 5139.41 to 5139.43 of the Revised Code.

(F) If the board or other governing body of a communitycorrections facility establishes an advisory board, the board or othergoverning authority of the community corrections facility shall reimburse themembers of the advisory board for their actual and necessary expenses incurredin the performance of their official duties on the advisory board. Themembers of advisory boards shall serve without compensation.

Sec. 5153.16.  (A) Except as provided in section 2151.422ofthe RevisedCode, in accordance with rules of the department ofjob and familyservices, and onbehalf of children in the countywhom thepublic children services agency considers to be in needof public careor protective services, the public childrenservices agency shall do all ofthe following:

(1) Make an investigation concerning any child alleged to bean abused,neglected, or dependent child;

(2) Enter into agreements with the parent, guardian, orother person having legal custody of any child, or with thedepartment of job and family services, department of mentalhealth,department of mental retardation and developmentaldisabilities,other department, any certified organization withinor outsidethe county, or any agency or institution outside thestate,having legal custody of any child, with respect to thecustody,care, or placement of any child, or with respect to anymatter, in the interests of the child, provided the permanentcustody of a child shall not be transferred by a parent to thepublic children services agencywithout the consent of thejuvenile court;

(3) Accept custody of children committed to the publicchildren servicesagency by a courtexercising juvenilejurisdiction;

(4) Provide such care as thepublic children services agencyconsiders to be in the best interestsof any child adjudicated tobe an abused, neglected, or dependent childthe agencyfinds to bein need of public care or service;

(5) Provide social services to any unmarried girladjudicated to bean abused, neglected, or dependent child who ispregnant with or has beendelivered of a child;

(6) Make available to the bureau for children with medicalhandicaps of the department of health at its request anyinformation concerning a crippled child found to be in need oftreatment under sections 3701.021 to 3701.028 of the Revised Codewho is receiving services from the publicchildren servicesagency;

(7) Provide temporary emergency care for any childconsidered by the public childrenservices agency to be in need ofsuch care, without agreement orcommitment;

(8) Find certified foster homes, within or outside thecounty, for the care of children, including handicapped childrenfrom other counties attending special schools in the county;

(9) Subject to the approval of the board of countycommissioners and the state department of job and family services,establish and operate a training school or enter into anagreementwith any municipal corporation or other politicalsubdivision ofthe county respecting the operation, acquisition,or maintenanceof any children's home, training school, or otherinstitution forthe care of children maintained by such municipalcorporation orpolitical subdivision;

(10) Acquire and operate a county children's home,establish, maintain, and operate a receiving home for thetemporary care of children, or procure certified fosterhomes forthis purpose;

(11) Enter into an agreement with the trustees of anydistrict children's home, respecting the operation of thedistrictchildren's home in cooperation with the other countyboards in thedistrict;

(12) Cooperate with, make its services available to, andactas the agent of persons, courts, the department of job and familyservices, the department of health, and other organizationswithinand outside the state, in matters relating to the welfareofchildren, except that the public children services agency shallnot be required to provide supervision of or other servicesrelated to theexercise of parenting time rights granted pursuantto section 3109.051 or 3109.12 of the Revised Code orcompanionship or visitation rightsgranted pursuant to section3109.051, 3109.11, or 3109.12 of theRevised Code unless ajuvenile court, pursuant to Chapter 2151. ofthe RevisedCode, ora common pleas court, pursuant to division(E)(6)of section3113.31 of the Revised Code, requires theprovision ofsupervisionor otherservices relatedto the exerciseof the parenting timerights or companionship or visitation rights;

(13) Make investigations at the request of anysuperintendent of schools in the county or the principal of anyschool concerning the application of any child adjudicated to bean abused,neglected, or dependent child for release from school,where such serviceis not provided through a school attendancedepartment;

(14) Administer funds provided under Title IV-E of the"Social Security Act," 94 Stat. 501 (1980), 42 U.S.C.A. 671, asamended, in accordance with rules adopted under section 5101.141of the RevisedCode;

(15) In addition to administering Title IV-E adoptionassistance funds, enter into agreements to make adoptionassistance payments under section 5153.163 of the Revised Code;

(16) Implement a system of risk assessment, in accordancewithrules adopted by the director ofjob and familyservices, toassist the publicchildren services agency in determining the riskof abuse or neglect to achild;

(17) Enter into a plan of cooperation with the board ofcounty commissioners under section 307.983 of the Revised Code andcomply with each fiscal agreement the board enters into undersection 307.98 of theRevised Code that include family services duties of public children services agencies and contracts the board entersinto under sections 307.981 and307.982 of the Revised Code thataffect the public children servicesagency;

(18) Make reasonable efforts to prevent the removal of analleged oradjudicated abused, neglected, or dependent child fromthe child's home,eliminate the continued removal of the childfrom the child's home, or make itpossible for the child to returnhome safely, except that reasonableefforts of that nature are notrequired when a court has made a determinationunderdivision(A)(2) of section 2151.419 of the Revised Code;

(19) Make reasonable efforts to place the child in atimelymanner in accordance with the permanency plan approvedunderdivision (E) of section2151.417 of the Revised Code and tocomplete whateversteps are necessary to finalize the permanentplacement of thechild;

(20) Administer a Title IV-A program identified underdivision (A)(3)(4)(c) or (d)(f) of section 5101.80 of the Revised Codethat the department of job and family services provides for thepublic children services agency to administer under thedepartment's supervision pursuant to section 5101.801 of theRevised Code;

(21) Administer the kinship permanency incentive program created under section 5101.802 of the Revised Code under the supervision of the director of job and family services;

(22) Provide independent living services pursuant to sections2151.81 to 2151.84 of the Revised Code.

(B) The public children services agency shall use the systemimplemented pursuant to division (B)(16) of this section inconnection with an investigation undertaken pursuant to division(F)(1) of section 2151.421 of the Revised Code andmay use thesystem at any other time the agency is involved with any childwhen the agency determines that risk assessment is necessary.

(C) Except as provided in section 2151.422 of the RevisedCode,in accordance with rules of the director ofjob and familyservices, and onbehalf of children in the county whom the publicchildren services agencyconsiders to be in need of public care orprotective services, the publicchildren services agency may dothe following:

(1) Provide or find, with otherchild serving systems,specialized foster care for the care of children in aspecializedfoster home, as defined in section 5103.02 of the RevisedCode,certified under section 5103.03 of the Revised Code;

(2)(a) Except as limited by divisions (C)(2)(b) and(c) ofthis section, contract with the following for the purpose ofassistingthe agency with its duties:

(i) County departments of job and family services;

(ii) Boards of alcohol, drug addiction, and mentalhealthservices;

(iii) County boards of mental retardation anddevelopmentaldisabilities;

(iv) Regional councils of political subdivisionsestablishedunder Chapter 167. of the Revised Code;

(v) Private and government providers of services;

(vi) Managed care organizations and prepaid health plans.

(b) A public children services agency contractunderdivision (C)(2)(a) of this section regarding the agency's dutiesundersection 2151.421 of the Revised Code may not provide for theentity under contract with the agency to perform any service notauthorized by the department's rules.

(c) Only a county children services boardappointed undersection 5153.03 of the Revised Code that is a public childrenservices agency may contract under division (C)(2)(a) of thissection. If anentity specified in division (B) or (C) of section5153.02 of the Revised Codeis the public children services agencyfor a county, the board of countycommissioners may enter intocontracts pursuant to section 307.982 of theRevised Coderegarding the agency's duties.

Sec. 5502.01.  (A) The department of public safety shalladministerand enforce the laws relating to the registration,licensing, sale, andoperation of motorvehicles and the lawspertaining to the licensing of drivers of motorvehicles.

The department shall compile, analyze, and publish statisticsrelative tomotor vehicle accidents and the causes of them,prepareand conduct educational programs for the purpose ofpromoting safety in theoperation of motor vehicleson thehighways, andconduct research and studiesfor the purpose ofpromoting safetyon the highways of this state.

(B) The department shall administer the laws and rulesrelative to traumaand emergency medicalservices specified inChapter 4765. of the Revised Code.

(C) The department shall administer and enforce the lawscontained in Chapters 4301. and 4303. of the Revised Codeandenforce the rules andordersof theliquor control commissionpertaining to retail liquor permit holders.

(D) The department shall administer the laws governing thestateemergency management agency and shall enforce all additionalduties andresponsibilities as prescribed in the Revised Coderelatedto emergency management services.

(E) The department shall conduct investigations pursuant toChapter 5101. of the Revised Code in support of theduty of thedepartment ofjob and familyservices to administer foodstampprogramsthroughout this state. Thedepartment of publicsafetyshallconduct investigations necessary to protectthestate'spropertyrights and interests in the food stamp program.

(F) The department of public safety shall enforce compliancewithorders and rules of the public utilities commission andapplicable laws inaccordance with Chapters 4919., 4921., and4923. of the Revised Code regardingcommercial motor vehicletransportation safety, economic, and hazardousmaterialsrequirements.

(G) Notwithstanding Chapter 4117. of the Revised Code, thedepartmentof public safety may establish requirements for itsenforcementpersonnel, including its enforcement agents describedin section5502.14 of the Revised Code, that include standards ofconduct, work rules andprocedures, and criteria foreligibilityas law enforcement personnel.

(H) The department shall administer, maintain, and operatethe Ohiocriminal justice network. The Ohio criminal justicenetworkshall be a computer network that supports state and localcriminal justice activities. The network shall be an electronicrepository for various data, which may include arrest warrants,notices of persons wanted by law enforcement agencies, criminalrecords, prison inmate records, stolen vehicle records, vehicleoperator's licenses, and vehicle registrations andtitles.

(I) The department shall coordinate all homeland security activities of all state agencies and shall be a liaison between state agencies and local entities for those activities and related purposes.

(J) Beginning July 1, 2004, the department shall administer and enforce the laws relative to private investigators and security service providers specified in Chapter 4749. of the Revised Code.

(K) The department shall administer criminal justice services in accordance with sections 5502.61 to 5502.66 of the Revised Code.

Sec. 5502.03. (A) There is hereby created in the department of public safety a division of homeland security. It is the intent of the general assembly that the creation of the division of homeland security of the department of public safety by this amendment does not result in an increase of funding appropriated to the department.

(B)(1) The division shall coordinate all homeland security activities of all state agencies and shall be the liaison between state agencies and local entities for the purposes of communicating homeland security funding and policy initiatives.

(2) The division and the department shall distribute any homeland security funds on a county basis and shall not distribute those funds on a regional basis unless federal law requires distribution on a regional basis.

(C) The director of public safety shall appoint an executive director, who shall be head of the division of homeland security and who regularly shall advise the governor and the director on matters pertaining to homeland security. The executive director shall serve at the pleasure of the director of public safety. To carry out the duties assigned under this section, the executive director, subject to the direction and control of the director of public safety, may appoint and maintain necessary staff and may enter into any necessary agreements.

(D) Except as otherwise provided by law, nothing in this section shall be construed to give the director of public safety or the executive director of the division of homeland security authority over the incident management structure or responsibilities of local emergency response personnel.

Sec. 181.51 5502.61.  As used in sections 181.51 5502.61 to 181.56 5502.66 of theRevised Code:

(A)"Federal criminal justice acts" means any federal lawthat authorizes financial assistance and other forms ofassistanceto be given by the federal government to the states tobe used forthe improvement of the criminal and juvenile justicesystems ofthe states.

(B)(1)"Criminal justice system" includes all of thefunctions of the following:

(a) The state highway patrol, county sheriff offices,municipal and township police departments, and all other lawenforcement agencies;

(b) The courts of appeals, courts of common pleas,municipalcourts, county courts, and mayor's courts, when dealingwithcriminal cases;

(c) The prosecuting attorneys, city directors of law,village solicitors, and other prosecuting authorities whenprosecuting or otherwise handling criminal cases and the countyand joint county public defenders and other public defenderagencies or offices;

(d) The department of rehabilitation and correction,probation departments, county and municipal jails and workhouses,and any other department, agency, or facility that is concernedwith the rehabilitation or correction of criminal offenders;

(e) Any public or private agency whose purposes includetheprevention of crime or the diversion, adjudication,detention, orrehabilitation of criminal offenders;

(f) Any public or private agency, the purposes of whichinclude assistance to crime victims or witnesses.

(2) The inclusion of any public or private agency, thepurposes of which include assistance to crime victims orwitnesses, as part of the criminal justice system pursuant todivision (B)(1) of this section does not limit, and shall not beconstrued as limiting, the discretion or authority of theattorneygeneral with respect to crime victim assistance andcriminaljustice programs.

(C)"Juvenile justice system" includes all of thefunctionsof the juvenile courts, the department of youthservices, anypublic or private agency whose purposes include theprevention ofdelinquency or the diversion, adjudication,detention, orrehabilitation of delinquent children, and any ofthe functions ofthe criminal justice system that are applicableto children.

(D)"Comprehensive plan" means a document thatcoordinates,evaluates, and otherwise assists, on an annual ormulti-yearbasis,any of the functions of the criminal andjuvenilejusticesystems of the state or a specified area of thestate,thatconforms to the priorities of the state with respecttocriminaland juvenile justice systems, and that conforms withtherequirements of all federal criminal justice acts. Thesefunctionsmay include, but are not limited to,any of thefollowing:

(1) Crime and delinquency prevention;

(2) Identification, detection, apprehension, and detentionof persons charged with criminal offenses or delinquent acts;

(3) Assistance to crime victims or witnesses, except thatthe comprehensive plan does not include the functions of theattorney general pursuant to sections 109.91 and 109.92 of theRevised Code;

(4) Adjudication or diversion of persons charged withcriminal offenses or delinquent acts;

(5) Custodial treatment of criminal offenders,delinquentchildren, or both;

(6) Institutional and noninstitutional rehabilitation ofcriminal offenders, delinquent children, or both.

(E)"Metropolitan county criminal justice services agency"means an agency that is established pursuant to division (A) ofsection 181.54 5502.64 of the Revised Code.

(F)"Administrative planning district" means a districtthatis established pursuant to division (A)or (B) of section 181.56 5502.66ofthe Revised Code.

(G)"Criminal justice coordinating council" means acriminaljustice services agency that is established pursuant todivision(D) of section 181.56 5502.66 of the Revised Code.

(H)"Local elected official" means any person who is amemberof a board of county commissioners or township trustees orof acity or village council, judge of the court of common pleas,amunicipal court, or a county court, sheriff, county coroner,prosecuting attorney, city director of law, village solicitor, ormayor.

(I)"Juvenile justice coordinating council" means a juvenilejustice services agency that is established pursuant to division(D) of section 181.56 5502.66 of the Revised Code.

Sec. 181.52 5502.62.  (A) There is hereby created an office in the department of public safety a division ofcriminal justice services. The governor director of public safety, with the concurrence of the governor, shall appoint a an executive directorof the office, and the director mayappoint, within the office,any professional and technicalpersonnel and other employees thatare necessary to enable theoffice to comply with sections 181.51to 181.56 of the RevisedCode division of criminal justice services. The executive director shall be the head of the division. The executive director shall serve at the pleasure of the director of public safety. To carry out the duties assigned under this section and to comply with sections 5502.63 to 5502.66 of the Revised Code, the executive director, subject to the direction and control of the director of public safety, may appoint and maintain any necessary staff and may enter into any necessary contracts and other agreements. The executive director and the assistantdirector of the office division, andall professional and technicalpersonnel employed within theoffice division who are not public employeesas defined in section 4117.01of the Revised Code, shall be in theunclassified civil service,and all other persons employed withinthe office division shall be in theclassified civil service. The directormay enter into anycontracts, except contracts governed by Chapter4117. of theRevised Code, that are necessary for the operation ofthe office.

(B) Subject to division(E) of this section and subjecttodivisions(D) to (F) of section 5120.09 of the Revised Codeinsofar as thosedivisions relate to federal criminal justice actsthat the governor requiresthe department of rehabilitation andcorrection to administer, the office divisionof criminal justice servicesshall do all of the following:

(1) Serve as the state criminal justice services agencyandperform criminal justice system planning in thestate, includingany planning that is required by any federallaw;

(2) Collect, analyze, and correlate information and dataconcerning the criminal justicesystem in thestate;

(3) Cooperate with and provide technical assistance tostatedepartments, administrative planning districts,metropolitancounty criminal justice services agencies, criminaljusticecoordinating councils, agencies, offices, and departmentsof thecriminal justicesystem in the state, andother appropriateorganizations and persons;

(4) Encourage and assist agencies, offices, anddepartmentsof the criminal justicesystem in thestateand otherappropriate organizations and persons to solveproblemsthatrelate to the duties of the office division;

(5) Administer within the state any federal criminaljusticeacts that the governor requiresit toadminister;

(6)Administer funds received under the"Family ViolencePrevention and Services Act," 98 Stat. 1757 (1984), 42 U.S.C.A.10401, as amended, with all powers necessary for the adequateadministration of those funds, including the authority toestablish a family violence prevention and services program.

(7) Implement the state comprehensive plans;

(8) Audit grant activities of agencies, offices,organizations, and persons that are financed in whole or in partby funds granted through the office division;

(9) Monitor or evaluate the performance of criminal justicesystem projects and programs in the statethatare financed inwhole or in part by funds granted through theoffice division;

(10) Apply for, allocate, disburse, and account forgrantsthat are made available pursuant to federal criminaljustice acts,or made available fromother federal,state, or private sources,to improve the criminaljusticesystem in the state. All Except as otherwise provided in this division, all moneyfromsuch federalgrantsshall, if the terms under which the moneyisreceivedrequire thatthemoney be deposited into aninterest-bearing fundor account,be deposited inthe statetreasury to the credit ofthe federalprogram purposes fund, whichis hereby created. Allinvestmentearnings of the federal program purposes fund shall becredited tothe fund. All money from such federal grants that require that the money be deposited into an interest-bearing fund or account, that are intended to provide funding to local criminal justice programs, and that require that investment earnings be distributed for program purposes shall be deposited in the state treasury to the credit of the federal justice programs fund, which is hereby created. All investment earnings of the federal justice programs fund shall be credited to the fund and distributed in accordance with the terms of the grant under which the money is received.

(11) Contract with federal, state, and local agencies,foundations, corporations, businesses, and persons when necessaryto carry out the duties of the office division;

(12) Oversee the activities of metropolitan countycriminaljustice services agencies, administrative planningdistricts, andcriminal justice coordinating councils in thestate;

(13) Advise the director of public safety, general assembly, and governor onlegislationand other significant matters that pertain to theimprovement andreform of criminal and juvenile justice systemsinthe state;

(14) Prepare and recommend legislation to the director of public safety, generalassembly, and governor for the improvement of the criminal andjuvenile justice systems in the state;

(15) Assist, advise, and make any reports that arerequestedor required by the governor, director of public safety, attorney general, orgeneralassembly;

(16) Adopt Subject to the approval of the director of public safety, adopt rules pursuant to Chapter 119. of the RevisedCode.

(C)Upon the request of the director of public safety or governor, the office division ofcriminaljustice services may do any ofthefollowing:

(1) Collect, analyze, or correlate information and dataconcerning the juvenile justice system in the state;

(2) Cooperate with and provide technical assistance to statedepartments, administrative planning districts, metropolitancounty criminal justice service agencies, criminal justicecoordinating councils, agency offices, and the departments of thejuvenile justice system in the state and other appropriateorganizations and persons;

(3) Encourage and assist agencies, offices, and departmentsof the juvenile justice system in the state and other appropriateorganizations and persons to solve problems that relate to theduties of the office division.

(D)Divisions (B)and (C) of this sectiondo not limitthediscretion or authorityof the attorney general with respecttocrime victim assistance andcriminal justice programs.

(E) Nothing in this section is intended to diminish oralterthe status of the office of the attorney general as acriminaljustice services agency.

Sec. 181.251 5502.63. The office division of criminal justice services in the department of public safety shall prepare a poster and a brochure that describe safe firearms practices. The poster and brochure shall contain typeface that is at least one-quarter inch tall. The office division shall furnish copies of the poster and brochure free of charge to each federally licensed firearms dealer in this state.

As used in this section, "federally licensed firearms dealer" means an importer, manufacturer, or dealer having a license to deal in destructive devices or their ammunition, issued and in effect pursuant to the federal "Gun Control Act of 1968," 82 Stat. 1213, 18 U.S.C. 923 et seq., and any amendments or additions to that act or reenactments of that act.

Sec. 181.54 5502.64.  (A) A county may enter into an agreementwiththe largest city within the county to establish ametropolitancounty criminal justice services agency, if thepopulation of thecounty exceeds five hundred thousand or thepopulation of the cityexceeds two hundred fifty thousand.

(B) A metropolitan county criminal justice services agencyshall do all of the following:

(1) Accomplish criminal and juvenile justice systemsplanning within its services area;

(2) Collect, analyze, and correlate information and dataconcerning the criminal and juvenile justice systems within itsservices area;

(3) Cooperate with and provide technical assistance to allcriminal and juvenile justice agencies and systems and otherappropriate organizations and persons within its services area;

(4) Encourage and assist agencies of the criminal andjuvenile justice systems and other appropriate organizations andpersons to solve problems that relate to its duties;

(5) Administer within its services area any federalcriminaljustice acts or juvenile justice acts that the office division ofcriminaljustice servicespursuant to section 5139.11 of the Revised Codeor the department of youth services administerswithin the state;

(6) Implement the comprehensive plans for its servicesarea;

(7) Monitor or evaluate, within its services area, theperformance of the criminal and juvenile justice systems projectsand programs that are financed in whole or in part by fundsgranted through it;

(8) Apply for, allocate, and disburse grants that are madeavailable pursuant to any federal criminal justice acts, orpursuant to any other federal, state, or private sources for thepurpose of improving the criminal and juvenile justice systems;

(9) Contract with federal, state, and local agencies,foundations, corporations, and other businesses or persons tocarry out the duties of the agency.

Sec. 181.55 5502.65.  (A)(1) When funds are available forcriminaljustice purposes pursuant to section 181.54 5502.64 ofthe Revised Code,the office division of criminal justice services shallprovidefunds tometropolitan county criminal justice servicesagenciesfor thepurpose of developing, coordinating, evaluating,andimplementingcomprehensive plans within their respectivecounties. The office divisionof criminal justice services shall providefunds to an agency onlyif it complies with the conditions ofdivision (B) of thissection.

(2) When funds are available for juvenile justice purposespursuant to section 181.54 5502.64 of the Revised Code, the department ofyouth services shall provide funds to metropolitan county criminaljustice services agencies for the purpose of developing,coordinating, evaluating, and implementing comprehensive planswithin their respective counties. The department shall providefunds to an agency only if it complies with the conditions ofdivision (B) of this section.

(B) A metropolitan county criminal justice services agencyshall do all of the following:

(1) Submit, in a form that is acceptable to the office division ofcriminal justice servicesor the department of youth servicespursuant to section 5139.01 of the Revised Code, a comprehensiveplan for the county;

(2) Establish a metropolitan county criminal justiceservices supervisory board whose members shall include a majorityof the local elected officials in the county and representativesfrom law enforcement agencies, courts, prosecuting authorities,public defender agencies, rehabilitation and correction agencies,community organizations, juvenile justice services agencies,professionals, and private citizens in the county, and that shallhave the authority set forth in division (C) of this section;

(3) Organize in the manner provided in sections 167.01 to167.03, 302.21 to 302.24, or 713.21 to 713.27 of the RevisedCode,unless the board created pursuant to division (B)(2) ofthissection organizes pursuant to these sections.

(C) A metropolitan county criminal justice servicessupervisory board shall do all of the following:

(1) Exercise leadership in improving the quality of thecriminal and juvenile justice systems in the county;

(2) Review, approve, and maintain general oversight of thecomprehensive plans for the county and the implementation of theplans;

(3) Review and comment on the overall needs andaccomplishments of the criminal and juvenile justice systems inthe county;

(4) Establish, as required to comply with this division,task forces, ad hoc committees, and other committees, whosemembers shall be appointed by thechairperson of theboard;

(5) Establish any rules that the board considers necessaryand that are consistent with the federal criminal justice actsandsection 181.52 5502.62 of the Revised Code.

Sec. 181.56 5502.66.  (A) In counties in which a metropolitancountycriminal justice services agency does not exist, theoffice division ofcriminal justice services shall discharge the office's division'sdutiesthatthe governor director of public safety requires it to administer byestablishingadministrative planning districtsfor criminaljustice programs.Anadministrative planning district shallcontain a group ofcontiguous counties in which no county has ametropolitan countycriminal justice services agency.

(B)In counties in which a metropolitan countycriminaljustice services agency does not exist, the department ofyouthservices shall discharge pursuant to section 5139.11 of theRevised Code the department's duty byestablishingadministrativeplanning districts for juvenilejustice programs.

(C) All administrative planning districts shall contain agroup ofcontiguous counties in which no county has a metropolitancountycriminal justice services agency.

(D) Any county or any combination of contiguous countieswithin an administrative planning district may form a criminaljustice coordinating councilor a juvenile justice coordinatingcouncil for its respective programs, if the county or the group ofcounties has a total population in excess of two hundred fiftythousand. The council shall comply with the conditions set forthin divisions (B) and (C) of section 181.55 5502.65 of the Revised Code,and exercise within its jurisdiction the powers and duties setforth in division (B) of section 181.54 5502.64 of the Revised Code.

Sec. 5531.10.  (A) As used in this chapter:

(1) "Bond proceedings" means the resolution, order, trustagreement, indenture, lease, lease-purchase agreements, and otheragreements, amendments andsupplements to the foregoing, or any one or more or combinationthereof, authorizing or providing for the terms and conditionsapplicable to, or providing for the security or liquidity of,obligations issued pursuant to this section, and the provisionscontained in such obligations.

(2) "Bond service charges" means principal, includingmandatory sinking fund requirements for retirement ofobligations, and interest, and redemption premium, if any,required to be paid by the state on obligations.

(3) "Bond service fund" means the applicable fund andaccounts therein created for and pledged to the payment of bondservice charges, which may be, or may be part of, the state infrastructurebank revenue bond service fund created by division (R) ofthissection including all moneys and investments, and earnings frominvestments, credited and to be credited thereto.

(4) "Issuing authority" means the treasurer of state, orthe officer who by law performs the functions of the treasurer of state.

(5) "Obligations" means bonds, notes, or other evidence ofobligation including interest coupons pertaining thereto, issuedpursuant to this section.

(6) "Pledged receipts" means moneys accruingto the state from the lease, lease-purchase, sale, or otherdisposition, or use, of qualified projects,and from the repayment, includinginterest, of loans made from proceeds received from the sale ofobligations; accrued interest received from the sale ofobligations; income from the investment of the special funds;any gifts, grants, donations, and pledges, and receiptstherefrom, available for the payment of bond service charges; and any amountsin the state infrastructure bank pledged to the payment of such charges. If the amounts in the state infrastructure bank are insufficient for the payment of such charges, "pledged receipts" also means moneys that are apportioned by the United States secretary of transportation under United States Code, Title XXIII, as amended, or any successor legislation, or under any other federal law relating to aid for highways, and that are to be received as a grant by the state, to the extent the state is not prohibited by state or federal law from using such moneys and the moneys are pledged to the payment of such bond service charges.

(7) "Special funds" or "funds" means, except where thecontext does not permit, the bond service fund, and any otherfunds, including reserve funds, created under the bondproceedings, and the state infrastructure bank revenue bond service fundcreated by division (R) of this section to the extentprovided in the bond proceedings, including all moneys and investments, andearnings from investment, credited and to be credited thereto.

(8) "State infrastructure project" means any publictransportation project undertaken by the state, including, but not limited to,all components of any such project, as described in division (D) ofsection 5131.09 5531.09 of the Revised Code.

(9) "District obligations" means bonds, notes, or other evidence of obligation including interest coupons pertaining thereto, issued to finance a qualified project by a transportation improvement district created pursuant to section 5540.02 of the Revised Code, of which the principal, including mandatory sinking fund requirements for retirement of such obligations, and interest and redemption premium, if any, are payable by the department of transportation.

(B) The issuing authority, after giving writtennotice to the director of budget and management and upon the certificationby the director of transportation to the issuingauthority of the amount of moneys or additional moneys needed either forstate infrastructure projects or to provide financial assistance for anyof the purposes for which the stateinfrastructure bank may be used under section 5531.09 of the Revised Code,or needed for capitalizedinterest, funding reserves, and paying costs and expensesincurred in connection with the issuance, carrying, securing,paying, redeeming, or retirement of the obligations or anyobligations refunded thereby, including payment of costs andexpenses relating to letters of credit, lines of credit,insurance, put agreements, standby purchase agreements, indexing,marketing, remarketing and administrative arrangements, interestswap or hedging agreements, and any other credit enhancement,liquidity, remarketing, renewal, or refunding arrangements, allof which are authorized by this section, shall issue obligations of the stateunder this section in therequired amount. The proceeds of such obligations, except for theportion to be deposited in special funds, including reservefunds, as may be provided in the bond proceedings, shall asprovided in the bond proceedings be credited to the infrastructure bankobligations fund of the state infrastructurebank created by section 5531.09of the Revised Code and disbursed as provided in the bond proceedings for such obligations. The issuing authority may appoint trustees, payingagents, transfer agents, and authenticatingagents, and may retain the services of financialadvisors, accounting experts, and attorneys, and retain orcontract for the services of marketing, remarketing, indexing,and administrative agents, other consultants, and independentcontractors, including printing services, as are necessary in theissuing authority's judgment to carry out this section. Thecosts of such services are payable from funds of thestate infrastructure bank.

(C) Except as otherwise provided in this division, the holders or owners of such obligations shall haveno right to have moneys raised by taxation by the state ofOhio obligated or pledged, and moneys so raised shall notbe obligated or pledged,for the payment of bond service charges. The municipal corporations and counties may pledge and obligate moneys received pursuant to sections 4501.04, 5709.42, 5709.79, 5735.23, 5735.27, and 5735.291 of the Revised Code to the payment of amounts payable by those municipal corporations and counties to the state infrastructure bank pursuant to section 5531.09 of the Revised Code, and the bond proceedings for obligations may provide that such payments shall constitute pledged receipts, provided such moneys are obligated, pledged, and paid only with respect to obligations issued exclusively for public transportation projects. The right of such holdersand owners to the payment of bond service charges is limited to allor that portion of the pledged receipts and those special fundspledged thereto pursuant to the bond proceedings for such obligationsin accordancewith this section, and each such obligation shall bear on itsface a statement to that effect.

(D) Obligations shall be authorized by orderof the issuing authority and the bond proceedings shall providefor the purpose thereof and the principal amount or amounts, andshall provide for or authorize the manner or agency fordetermining the principal maturity or maturities, not exceedingtwenty-five years from the date of issuance, the interest rate orrates or the maximum interest rate, the date of the obligationsand the dates of payment of interest thereon, their denomination,and the establishment within or without the state of a place orplaces of payment of bond service charges. Sections 9.98 to9.983 of the Revised Code are applicable to obligations issuedunder this section. The purpose of suchobligations may be stated in the bond proceedings in termsdescribing the general purpose or purposes to be served. Thebond proceedings also shall provide, subject to the provisions ofany other applicable bond proceedings, for the pledge of all, orsuch part as the issuing authority maydetermine, of the pledgedreceipts and the applicable special fund or funds to the paymentof bond service charges, which pledges may be made either prioror subordinate to other expenses, claims, or payments, and may bemade to secure the obligations on a parity with obligationstheretofore or thereafter issued, if and to the extent providedin the bond proceedings. The pledged receipts and special fundsso pledged and thereafter received by the state immediatelyare subject to the lien of such pledge without any physical deliverythereof or further act, and the lien of any such pledges is validand binding against all parties having claims of any kind againstthe state or any governmental agency of the state, irrespectiveof whether such parties have notice thereof, and shall create aperfected security interest for all purposes of Chapter 1309. of the RevisedCode, without the necessity for separation ordelivery of funds or for the filing or recording of the bondproceedings by which such pledge is created or any certificate,statement, or other document with respect thereto; and the pledgeof such pledged receipts and special funds is effective and themoney therefrom and thereof may be applied to the purposes forwhich pledged without necessity for any act of appropriation. Every pledge, and every covenant and agreement made with respectthereto, made in the bond proceedings may therein be extended tothe benefit of the owners and holders of obligations authorizedby this section, and to any trustee therefor, for the furthersecurity of the payment of the bond service charges.

(E) The bond proceedings may contain additional provisionsas to:

(1) The redemption of obligations prior to maturity at theoption of the issuing authority at such price or prices and undersuch terms and conditions as are provided in the bondproceedings;

(2) Other terms of the obligations;

(3) Limitations on the issuance of additional obligations;

(4) The terms of any trust agreement or indenture securingthe obligations or under which the same may be issued;

(5) The deposit, investment, and application of specialfunds, and the safeguarding of moneys on hand or on deposit,without regard to Chapter 131. or 135. of the Revised Code, butsubject to any special provisions of this section withrespectto particular funds or moneys, provided that any bank or trustcompany which acts as depository of any moneys in the specialfunds may furnish such indemnifying bonds or may pledge suchsecurities as required by the issuing authority;

(6) Any or every provision of the bond proceedings beingbinding upon such officer, board, commission, authority, agency,department, or other person or body as may from time to time havethe authority under law to take such actions as may be necessaryto perform all or any part of the duty required by suchprovision;

(7) Any provision that may be made in a trust agreement orindenture;

(8) Any other or additional agreements with the holders ofthe obligations, or the trustee therefor, relating to theobligations or the security therefor, including the assignment ofmortgages or other securityrelating to financial assistance for qualified projects under section5531.09 of the Revised Code.

(F) The obligations may have the great seal of the stateor a facsimile thereof affixed thereto or printed thereon. Theobligations and any coupons pertaining to obligations shall besigned or bear the facsimile signature of the issuing authority. Any obligations or coupons may be executed by the person who, onthe date of execution, is the proper issuing authority althoughon the date of such bonds or coupons such person was not theissuing authority. In case the issuing authority whose signatureor a facsimile of whose signature appears on any such obligationor coupon ceases to be the issuing authority before deliverythereof, such signature or facsimile nevertheless is validand sufficient for all purposes as if the former issuingauthority had remained the issuingauthority until such delivery; and in case the seal to be affixedto obligations has been changed after a facsimile of the seal hasbeen imprinted on such obligations, such facsimile seal shallcontinue to be sufficient as to such obligations and obligationsissued in substitution or exchange therefor.

(G) All obligations are negotiable instruments andsecurities under Chapter 1308. of the Revised Code, subject tothe provisions of the bond proceedings as to registration. Theobligations may be issued in coupon or in registered form, orboth, as the issuing authority determines. Provision may be madefor the registration of any obligations with coupons attachedthereto as to principal alone or as to both principal andinterest, their exchange for obligations so registered, and forthe conversion or reconversion into obligations with couponsattached thereto of any obligations registered as to bothprincipal and interest, and for reasonable charges for suchregistration, exchange, conversion, and reconversion.

(H) Obligations may be sold at public sale or at privatesale, as determined in the bond proceedings.

(I) Pending preparation of definitive obligations, theissuing authority may issue interim receipts or certificateswhich shall be exchanged for such definitive obligations.

(J) In the discretion of the issuing authority,obligations may be secured additionally by a trust agreement orindenture between the issuing authority and a corporate trusteewhich may be any trust company or bank having its principal placeof business within the state. Any such agreement or indenturemay contain the order authorizing the issuance ofthe obligations, any provisions that may be contained in any bondproceedings, and other provisions which are customary orappropriate in an agreement or indenture of such type, including,but not limited to:

(1) Maintenance of each pledge, trust agreement,indenture, or other instrument comprising part of the bondproceedings until the state has fully paid the bond servicecharges on the obligations secured thereby, or provision thereforhas been made;

(2) In the event of default in any payments required to bemade by the bond proceedings, or any other agreement of theissuing authority made as a part of the contract under which theobligations were issued, enforcement of such payments oragreement by mandamus, the appointment of a receiver, suit inequity, action at law, or any combination of the foregoing;

(3) The rights and remedies of the holders of obligationsand of the trustee, and provisions for protecting and enforcingthem, including limitations on the rights of individual holders ofobligations;

(4) The replacement of any obligations that becomemutilated or are destroyed, lost, or stolen;

(5) Such other provisions as the trustee and the issuingauthority agree upon, including limitations, conditions, orqualifications relating to any of the foregoing.

(K) Any holder of obligations or a trustee under the bondproceedings, except to the extent that the holder's ortrustee's rights are restrictedby the bond proceedings, may by any suitable form of legalproceedings, protect and enforce any rights under the laws ofthis state or granted by such bond proceedings. Such rightsinclude the right to compel the performance of all duties of theissuing authority and the director of transportation required by the bondproceedings or sections 5531.09 and 5531.10 of theRevised Code; to enjoin unlawful activities; and in theevent ofdefault with respect to the payment of any bond service chargeson any obligations or in the performance of any covenant oragreement on the part of the issuing authority or the director oftransportation in the bondproceedings, to apply to a court having jurisdiction of the causeto appoint a receiver to receive and administer the pledgedreceipts and special funds, other than those in the custody ofthe treasurer of state, which are pledged to the payment of thebond service charges on such obligations or which are the subjectof the covenant or agreement, with full power to pay, and toprovide for payment of bond service charges on, such obligations,and with such powers, subject to the direction of the court, asare accorded receivers in general equity cases, excluding anypower to pledge additional revenues or receipts or other incomeor moneys of the state or localgovernmental entities, or agenciesthereof, to the payment of such principal andinterest and excluding the power to take possession of, mortgage,or cause the sale or otherwise dispose of any project facilities.

Each duty of the issuing authority and the issuingauthority's officers and employees, and of each state or localgovernmentalagency and its officers, members, or employees, undertakenpursuant to the bond proceedings or any loan, loanguarantee, lease, lease-purchase agreement, orother agreement made under authority of section5531.09 of the Revised Code, and in every agreement byor with the issuing authority,is hereby established as a duty of the issuing authority, and ofeach such officer, member, or employee having authority toperform such duty, specifically enjoined by the law resultingfrom an office, trust, or station within the meaning of section2731.01 of the Revised Code.

The person who is at the time the issuing authority, or theissuing authority's officers or employees, are not liable intheir personal capacities on any obligations issued by theissuing authority or any agreements of or with the issuingauthority.

(L) The issuing authority may authorize and issueobligations for the refunding, including funding and retirement,and advance refunding with or without payment or redemption priorto maturity, of any obligations previously issued by the issuingauthority or district obligations. Such refunding obligations may be issued in amounts sufficientfor payment of the principal amount of the prior obligations or district obligations, anyredemption premiums thereon, principal maturities of any suchobligations or district obligations maturing prior to the redemption of the remainingobligations or district obligations on a parity therewith, interest accrued or to accrueto the maturity dates or dates of redemption of such obligations or district obligations,and any expenses incurred or to beincurred in connection with such issuance and such refunding,funding, and retirement. Subject to the bond proceedingstherefor, the portion of proceeds of the sale of refunding obligationsissued under this division to be applied to bond service chargeson the prior obligations or district obligations shall be credited to an appropriateaccount held by the trustee for such prior or new obligations orto the appropriate account in the bond service fund for suchobligations or district obligations. Obligations authorized under this division shall bedeemed to be issued for those purposes for which such priorobligations or district obligations were issued and are subject to the provisions of thissection pertaining to other obligations, except as otherwiseprovided in this section. Thelast maturity of obligations authorized under this division shall not be laterthan twenty-five years from the date of issuance of the original securitiesissued for the original purpose.

(M) The authority to issue obligations under this sectionincludes authority to issue obligations in the form of bondanticipation notes and to renew the same from time to time by theissuance of new notes. The holders of such notes or interestcoupons pertaining thereto shall have a right to be paid solelyfrom the pledged receipts and special funds that may be pledgedto the payment of the bonds anticipated, or from the proceeds ofsuch bonds or renewal notes, or both, as the issuing authorityprovides in the order authorizing such notes. Suchnotes may be additionally secured by covenants of the issuingauthority to the effect that the issuing authority and the statewill do such or all things necessary for the issuance of suchbonds or renewal notes in the appropriate amount, and apply theproceeds thereof to the extent necessary, to make full payment ofthe principal of and interest on such notes at the time or timescontemplated, as provided in such order. For suchpurpose, the issuing authority may issue bonds or renewal notesin such principal amount and upon such terms as may be necessaryto provide funds to pay when required the principal of andinterest on such notes, notwithstanding any limitationsprescribed by or for purposes of this section. Subject to thisdivision, all provisions for and references to obligations inthis section are applicable to notes authorized under thisdivision.

The issuing authority in the bond proceedings authorizingthe issuance of bond anticipation notes shall set forth for suchbonds an estimated interest rate and a schedule of principalpayments for such bonds and the annual maturity dates thereof.

(N) Obligations issued under this section are lawfulinvestments for banks, societies for savings, savings and loanassociations, deposit guarantee associations, trust companies,trustees, fiduciaries, insurance companies, including domesticfor life and domestic not for life, trustees or other officershaving charge of sinking and bond retirement or other specialfunds of political subdivisions and taxing districts of thisstate, the commissioners of the sinking fund of the state, theadministrator of workers' compensation, the state teachers retirementsystem, the public employees retirement system, the schoolemployees retirement system, and the Ohio police andfire pension fund, notwithstanding any otherprovisionsof the Revised Code or rules adopted pursuant thereto by anyagency of the state with respect to investments bythem, and are also acceptable as security for the deposit ofpublic moneys.

(O) Unless otherwise provided in any applicable bondproceedings, moneys to the credit of or in the special fundsestablished by or pursuant to this section may be invested by oron behalf of the issuing authority only in notes, bonds, or otherobligations of the United States, or of any agency orinstrumentality of the United States, obligations guaranteedas to principal and interest by the United States,obligations of this state orany political subdivision of this state, and certificates of deposit ofany national bank located in this state and any bank, as definedin section 1101.01 of the Revised Code, subject to inspection bythe superintendent of financial institutions. If the lawor the instrumentcreating a trust pursuant to division (J) of this sectionexpressly permits investment in direct obligations of the UnitedStates or an agency of the United States, unlessexpressly prohibited by theinstrument, such moneys also may be invested in no-front-end-loadmoney market mutual funds consisting exclusively of obligationsof the United States or an agency of the UnitedStates and in repurchaseagreements, including those issued by the fiduciary itself,secured by obligations of the United States or an agency ofthe United States;and in collectiveinvestment funds as defined in division (A) of section1111.01 of the Revised Code and consisting exclusivelyof anysuch securities. The income from such investments shall be credited to such fundsas the issuing authority determines, and such investments may besold at such times as the issuing authority determines orauthorizes.

(P) Provision may be made in the applicable bondproceedings for the establishment of separate accounts in thebond service fund and for the application of such accounts onlyto the specified bond service charges on obligations pertinent tosuch accounts and bond service fund and for other accountstherein within the general purposes of such fund. Unlessotherwise provided in any applicable bond proceedings, moneys tothe credit of or in the several special funds establishedpursuant to this section shall be disbursed on the order of thetreasurer of state, provided that no such order is required forthe payment from the bond service fund when due of bond servicecharges on obligations.

(Q)(1) The issuing authority may pledgeall, or such portionas the issuing authority determines, of the pledged receipts tothe payment of bond service charges on obligations issued underthis section, and for the establishment and maintenance of anyreserves, as provided in the bond proceedings, and make otherprovisions therein with respect to pledged receipts as authorizedby this chapter, which provisions are controlling notwithstandingany other provisions of law pertaining thereto.

(2) An action taken under division(Q)(2) of this section does not limit thegenerality of division (Q)(1) of this section, and is subject todivision (C) of this section and, if and to the extent otherwiseapplicable, Section 13 of Article VIII,Ohio Constitution. The bond proceedings may contain acovenant that, in the event the pledgedreceipts primarily pledged and required to be used for the payment of bondservice charges on obligations issued under this section, and for theestablishment and maintenance of any reserves, as provided in the bondproceedings, are insufficient to make any such payment in full when due, or tomaintain any such reserve, the director of transportation shall so notify thegovernor, and shall determine to what extent, if any, the payment may be madeor moneys may be restored to the reserves from lawfully available moneyspreviously appropriated for that purpose to the department of transportation. The covenant also mayprovide that if the payments are not made or the moneys are not immediatelyandfully restored to the reserves from such moneys, the director shallpromptly submit to the governor and to the director of budget and management awritten request for either or both of the following:

(a) That the next biennial budget submitted by the governor tothe general assembly include an amount to be appropriated from lawfullyavailablemoneys to the department for the purpose of and sufficient for the payment infull of bond service charges previously due and for the fullreplenishment of the reserves;

(b) That the general assembly be requested to increaseappropriations from lawfully available moneys forthe department in the current biennium sufficient for the purpose of and forthe payment in full of bond service charges previously due and to come due inthe biennium and for the full replenishment of the reserves.

The director of transportation shall include with such requests arecommendation that thepayment of the bond service charges and the replenishment of the reserves bemade in the interest of maximizing the benefits of the state infrastructurebank. Any such covenant shall not obligate or purport to obligate the statetopay the bond service charges on such bonds or notes or to deposit moneysin a reserve established for such payments other than from moneys that may belawfully available and appropriated for that purpose during the then-currentbiennium.

(R) There is hereby created the state infrastructure bank revenuebond service fund, which shall be in the custody of the treasurer ofstate but shall not be a part of thestate treasury. All moneys received by or on account of theissuing authority or state agencies and required by theapplicable bond proceedings, consistent with this section, to bedeposited, transferred, or credited to the bond service fund, and allother moneys transferred or allocated to or received for the purposes of thefund, shall be deposited and credited to such fund and to anyseparate accounts therein, subject to applicable provisions ofthe bond proceedings, but without necessity for any act ofappropriation. The state infrastructurebankrevenue bond service fund is a trust fund and ishereby pledged to the payment of bond service charges to theextent provided in the applicable bond proceedings, and paymentthereof from such fund shall be made or provided for by thetreasurer of state in accordance with such bond proceedingswithout necessity for any act of appropriation.

(S) The obligations issued pursuant to this section, the transferthereof, and the income therefrom, including any profit made on the salethereof, shall at all times be free from taxation within this state.

Sec. 5540.01.  As used in this chapter:

(A) "Transportation improvement district" or "district"means a transportation improvement district designated pursuantto section 5540.02 of the Revised Code.

(B) "Governmental agency" means a department, division, orother unit of state government; a county, township, or municipalcorporation or other political subdivision; a regional transitauthority or regional transit commission created pursuant toChapter 306. of the Revised Code; a port authority createdpursuant to Chapter 4582. of the Revised Code; and the UnitedStates or any agency thereof.

(C) "Project" means a street, highway, or othertransportation project constructed orimproved under this chapter and includes all bridges, tunnels,overpasses, underpasses, interchanges, approaches, those portionsof connecting streets or highways that serve interchanges and aredetermined by the district to be necessary for the safe mergingof traffic between the project and those streets or highways,service facilities, and administration, storage, and otherbuildings, property, and facilities, that the district considersnecessary for the operation of the project, together with allproperty and rights that must be acquired by the district for theconstruction, maintenance, or operation of the project.

(D) "Cost," as applied to the construction of a project,includes the cost of construction, including bridges over orunder existing highways and railroads, acquisition of allproperty acquired by the district for such construction,demolishing or removing any buildings or structures on land soacquired, including the cost of acquiring any lands to which suchbuildings or structures may be moved, site clearance,improvement, and preparation, diverting streets or highways,interchanges with streets or highways, access roads to privateproperty, including the cost of land or easements therefor, allmachinery, furnishings, and equipment, communications facilities,financing expenses, interest prior to and during construction andfor one year after completion of construction, traffic estimates,indemnity and surety bonds and premiums on insurance, andguarantees, engineering, feasibility studies, and legal expenses,plans, specifications, surveys, estimates of cost and revenues,other expenses necessary or incidental to determining thefeasibility or practicability of constructing a project, and suchother expense as may be necessary or incident to the constructionof the project and the financing of such construction. Anyobligation or expense incurred by any governmental agency orperson for surveys, borings, preparation of plans andspecifications, and other engineering services, or any other costdescribed above, in connection with the construction of a projectmay be regarded as part of the cost of the project and reimbursedfrom revenues, taxes, or the proceeds of bonds as authorized bythis chapter.

(E) "Owner" includes any person having any title orinterest in any property authorized to be acquired by a districtunder this chapter.

(F) "Revenues" means all moneys received by a districtwith respect to the lease, sublease, or sale, includinginstallment sale, conditional sale, or sale under alease-purchase agreement, of a project, all moneys received by a district under an agreement pursuant to Section 515.03 of H.B. 66 of the 126th General Assembly, any gift or grantreceived with respect to a project, tolls, special assessments levied by the district, proceeds of bonds tothe extent the use thereof for payment of principal or ofpremium, if any, or interest on the bonds is authorized by thedistrict, proceeds from any insurance, condemnation, or guarantypertaining to a project or property mortgaged to secure bonds orpertaining to the financing of a project, and income and profitfrom the investment of the proceeds of bonds or of any revenues.

(G) "Street or highway" has the same meaning as in section4511.01 of the Revised Code.

(H) "Financing expenses" means all costs and expensesrelating to the authorization, issuance, sale, delivery,authentication, deposit, custody, clearing, registration,transfer, exchange, fractionalization, replacement, payment, andservicing of bonds including, without limitation, costs andexpenses for or relating to publication and printing, postage,delivery, preliminary and final official statements, offeringcirculars, and informational statements, travel andtransportation, underwriters, placement agents, investmentbankers, paying agents, registrars, authenticating agents,remarketing agents, custodians, clearing agencies orcorporations, securities depositories, financial advisoryservices, certifications, audits, federal or state regulatoryagencies, accounting and computation services, legal services andobtaining approving legal opinions and other legal opinions,credit ratings, redemption premiums, and credit enhancementfacilities.

(I) "Bond proceedings" means the resolutions, trustagreements, certifications, notices, sale proceedings, leases,lease-purchase agreements, assignments, credit enhancementfacility agreements, and other agreements, instruments, anddocuments, as amended and supplemented, or any one or more ofcombination thereof, authorizing, or authorizing or providing forthe terms and conditions applicable to, or providing for thesecurity or sale or award or liquidity of, bonds, and includesthe provisions set forth or incorporated in those bonds and bondproceedings.

(J) "Bond service charges" means principal, including anymandatory sinking fund or mandatory redemption requirements forretirement of bonds, and interest and any redemption premiumpayable on bonds, as those payments come due and are payable tothe bondholder or to a person making payment under a creditenhancement facility of those bond service charges to abondholder.

(K) "Bond service fund" means the applicable fund createdby the bond proceedings for and pledged to the payment of bondservice charges on bonds provided for by those proceedings,including all moneys and investments, and earnings frominvestments, credited and to be credited to that fund as providedin the bond proceedings.

(L) "Bonds" means bonds, notes, including notesanticipating bonds or other notes, commercial paper, certificatesof participation, or other evidences of obligation, including anyinterest coupons pertaining thereto, issued pursuant to thischapter.

(M) "Net revenues" means revenues lawfully available topay both current operating expenses of a district and bondservice charges in any fiscal year or other specified period,less current operating expenses of the district and any amountnecessary to maintain a working capital reserve for that period.

(N) "Pledged revenues" means net revenues, moneys andinvestments, and earnings on those investments, in the applicablebond service fund and any other special funds, and the proceedsof any bonds issued for the purpose of refunding prior bonds, allas lawfully available and by resolution of the district committedfor application as pledged revenues to the payment of bondservice charges on particular issues of bonds.

(O) "Special funds" means the applicable bond service fundand any accounts and subaccounts in that fund, any other funds oraccounts permitted by and established under, and identified as aspecial fund or special account in, the bond proceedings,including any special fund or account established for purposes ofrebate or other requirements under federal income tax laws.

(P) "Credit enhancement facilities" means letters ofcredit, lines of credit, standby, contingent, or firm securitiespurchase agreements, insurance, or surety arrangements,guarantees, and other arrangements that provide for direct orcontingent payment of bond service charges, for security oradditional security in the event of nonpayment or default inrespect of bonds, or for making payment of bond service chargesand at the option and on demand of bondholders or at the optionof the district or upon certain conditions occurring under put orsimilar arrangements, or for otherwise supporting the credit orliquidity of the bonds, and includes credit, reimbursement,marketing, remarketing, indexing, carrying, interest rate hedge, and subrogationagreements, and other agreements and arrangements for payment andreimbursement of the person providing the credit enhancementfacility and the security for that payment and reimbursement.

(Q) "Refund" means to fund and retire outstanding bonds,including advance refunding with or without payment or redemptionprior to stated maturity.

(R) "Property" includes interests in property.

(S) "Administrative agent," "agent," "commercial paper,""floating rate interest structure," "indexing agent," "interest rate hedge," "interestrate period," "put arrangement," and "remarketing agent" have thesame meanings as in section 9.98 of the Revised Code.

(T) "Outstanding" as applied to bonds means outstanding inaccordance with the terms of the bonds and the applicable bondproceedings.

(U) "Interstate system" has the same meaning as in section5516.01 of the Revised Code.

Sec. 5540.09.  (A) The bonds do not constitute a debt, or a pledge of thefaith and credit, of the state or of any political subdivision of the state. Bond service charges on outstanding bonds are payable solely from the pledgedrevenues pledged for their payment as authorized by this chapter and asprovided in the bond proceedings. All bonds shall contain on their face astatement to that effect.

(B) All expenses incurred in carrying out this chapter shall be payablesolely from revenues provided under this chapter. This Except as provided in Section 515.03 of H.B. 66 of the 126th General Assembly, this chapter does notauthorize the board of trustees of a district to incur indebtedness orliability on behalf of or payable by the state or any political subdivision ofthe state.

Sec. 5549.01.  The board of county commissioners may purchase such machinery,tools, or other equipment, including special wearing apparel, for theconstruction, improvement, maintenance, or repair of the highways, bridges,andculverts under its jurisdiction as it deems necessary. The board may alsopurchase, hire, or lease automobiles, motorcycles, or other conveyances andmaintain them for the use of the county engineer and his theengineer's assistants when onofficial business. All such machinery, tools, and equipment, includingspecialwearing apparel, and conveyances belonging to the county shall be under thecare and custody of the engineer, and shall be plainly and conspicuouslymarkedas the property of the county.

The engineer shall annually, on the fifteenth day of November, make a writteninventory of all such items, indicating each article, stating the valuethereof, and the estimated cost of all necessary repairs thereto, and deliversuch inventory to the board, which shall cause it to be placed on file. Atthesame time he shall file with the board hiswritten recommendations as to what machinery, tools, and equipment, includingspecial wearing apparel, and conveyances should be purchased for the use ofthe county during the ensuing year and the probable cost thereof.

The board shall provide a suitable place for housing and storing machinery,tools, and equipment, including special wearing apparel, materials, andconveyances owned by the county, and may purchase the necessary material andconstruct, or enter into an agreement with a railroad company to construct,oneswitch or spur track from the right of way of such railroad company to land orstorage house owned by the county. All expenditures authorized by thissectionshall be paid out of any available road funds of the county.

Purchases, hiring, or leasing made by the board pursuant to this section shallbe governed by sections 307.86 to 307.92, inclusive, of the RevisedCode.

Sec. 5552.01.  As used in this chapter:

(A) "Metropolitan planning organization" has the samemeaning as in division (A)(7) of section 3704.14 of the RevisedCode means a metropolitan planning organization designated under section 9(a) of the "Federal-Aid Highway Act of 1962," 76 Stat. 1148, 23 U.S.C. 134, as amended.

(B) "Urban township" means a township that has a populationin the unincorporated area of the township of fifteen thousand ormore and that has adopted a limited home rule government undersection 504.02 of the Revised Code.

Sec. 5573.13.  The proportion of the compensation, damages,and costs of any road improvement to be paid by the townshipshall be paid out of any road improvement fund availabletherefor. For the purpose of providing by taxation a fund forthe payment of the township's proportion of the compensation,damages, and costs of constructing, reconstructing, resurfacing,or improving roads under sections 5571.01, 5571.06, 5571.07,5571.15, 5573.01 to 5573.15, inclusive, and 5575.02 to 5575.09,inclusive, of the Revised Code, and for the purpose ofmaintaining, repairing, or dragging any public road or partthereof under their jurisdiction, in the manner provided insections 5571.02 to 5571.05, inclusive, 5571.08, 5571.12,5571.13, and 5575.01 of the Revised Code, the board of trusteesmay levy, annually, a tax not exceeding three mills upon eachdollar of the taxable property of said township. Such levy shallbe in addition to all other levies authorized for townshippurposes, and subject only to the limitation on the combinedmaximum rate for all taxes now in force. The taxes so authorizedshall be placed by the county auditor upon the tax duplicate,against the taxable property of the township, and collected bythe county treasurer as other taxes. When collected, such taxesshall be paid to the township clerk of the township from whichthey are collected, and the money so received shall be under thecontrol of the board for the purposes for which the taxes werelevied.

Sec. 5703.052.  (A) There is hereby created in the statetreasurythe tax refund fund, from which refunds shall be paidfor taxesillegally or erroneously assessed or collected, or forany otherreason overpaid, that are levied by Chapter 4301.,4305., 5728.,5729., 5733., 5735., 5739., 5741., 5743., 5747.,5748., 5749., or5753. 5751., and sections 3737.71, 3905.35, 3905.36,4303.33, 5707.03,5725.18, 5727.28, 5727.38, 5727.81, and 5727.811 of theRevisedCode. Refunds for fees illegally or erroneously assessed orcollected, or for any other reason overpaid, that are levied bysections 3734.90 to 3734.9014 of the Revised Code also shall bepaid from the fund. However, refunds for taxes levied undersection 5739.101 of the Revised Code shall not be paid from thetax refund fund, but shall be paid as provided in section5739.104of the Revised Code.

(B)(1) Upon certification by the tax commissioner to the treasurerof state of a tax refund or fee refund, or bythesuperintendent of insurance of a domestic or foreigninsurance taxrefund, the treasurer of state shall place the amountcertified tothe credit of the fund. The certified amounttransferred shall bederived from current receipts of the sametax or the fee from whichthe refund arose. If current receipts from the tax or fee from which the refund arose areinadequateto make the transfer of the amount so certified, thetreasurer ofstate shall transfer such certified amount fromcurrent receipts ofthe sales tax levied by section 5739.02 ofthe Revised Code.

(2) When the treasurer of state provides for the payment of a refund of a tax or fee from the current receipts of the sales tax, and the refund is for a tax or fee that is not levied by the state, the tax commissioner shall recover the amount of that refund from the next distribution of that tax or fee that otherwise would be made to the taxing jurisdiction. If the amount to be recovered would exceed twenty-five per cent of the next distribution of that tax or fee, the commissioner may spread the recovery over more than one future distribution, taking into account the amount to be recovered and the amount of the anticipated future distributions. In no event may the commissioner spread the recovery over a period to exceed twenty-four months.

Sec. 5703.053.  As used in this section, "postal service"meansthe United States postal service.

An application to the tax commissioner for a tax refundundersection 4307.05, 4307.07, 5727.28, 5727.91,5728.061, 5735.122,5735.13,5735.14, 5735.141, 5735.142, 5739.07, 5741.10, 5743.05,5743.53,5745.11,5749.08, or 5753.06 5751.08 of the Revised Code ordivision (B) ofsection 5703.05 of the Revised Code, or a feerefunded undersection 3734.905 of the Revised Code, that isreceived after thelast day for filing under such section shall beconsidered tohave been filed in a timely manner if:

(A) The application is delivered by the postal service andthe earliest postal service postmark on the cover in which theapplication is enclosed is not later than the last day for filingthe application;

(B) The application is delivered by the postal service,theonly postmark on the cover in which the application isenclosedwas affixed by a private postal meter, the date of thatpostmarkis not later than the last day for filing theapplication, and theapplication is received within seven days ofsuch last day; or

(C) The application is delivered by the postal service, nopostmark date was affixed to the cover in which the applicationisenclosed or the date of the postmark so affixed is notlegible,and the application is received within seven days of thelast dayfor making the application.

Sec. 5703.057.  (A) For the efficient administration of the taxes and fees administered by the tax commissioner, the commissioner may require that any person filing a tax document with the department of taxation provide identifying information, which may include the person's social security number, federal employer identification number, or other identification number requested by the commissioner. A person required by the commissioner to provide identifying information who has experienced any change with respect to that information shall notify the commissioner of the change prior to, or upon, filing the next tax document requiring such identifying information.

(B) When transmitting or otherwise making use of a tax document that contains a person's social security number, the commissioner shall take all reasonable measures necessary to ensure that the number is not capable of being viewed by the general public, including, when necessary, masking the number so that it is not readily discernible by the general public.

(C)(1) If the commissioner makes a request for identifying information and the commissioner does not receive valid identifying information within thirty days of making the request, the commissioner may impose a penalty upon the person to whom the request was directed of up to one hundred dollars. If, after the expiration of this thirty day period, the commissioner makes one or more subsequent requests for identifying information and the person to whom the subsequent request is directed fails to provide valid identifying information within thirty days of the commissioner's subsequent request, the commissioner may impose an additional penalty of up to two hundred dollars for each subsequent request not complied with in a timely fashion.

(2) If a person required by the commissioner to provide identifying information does not notify the commissioner of a change with respect to that information as required under division (A) of this section within thirty days after filing the next tax document requiring such identifying information, the commissioner may impose a penalty of up to fifty dollars.

(3) The penalties provided for under divisions (C)(1) and (2) of this section may be billed and assessed in the same manner as the tax or fee with respect to which the identifying information is sought and are in addition to any applicable criminal penalties described in division (D) of this section and any other penalties that may be imposed by the commissioner by law.

(D) Section 5703.26 of the Revised Code applies with respect to false or fraudulent identifying information provided by a person to the commissioner under this section.

Sec. 5703.47.  (A) As used in this section, "federalshort-term rate" means the rate of the average market yield onoutstanding marketable obligations of the United States withremaining periods to maturity of three years or less, asdetermined under section 1274 of the "Internal Revenue Code of1986," 100 Stat. 2085, 26 U.S.C.A. 1274, for July of the currentyear.

(B) On the fifteenth day of October of each year, the taxcommissioner shall determine the federal short-term rate. Forpurposes of any section of the Revised Code requiring interest tobe computed at the rate per annum required by this section, therate determined by the commissioner under this section, roundedto the nearest whole number per cent, plus three per cent, shallbe the interest rate per annum used in making the computation forinterest that accrues during the following calendar year. For the purposes of sections 5719.041 and 5731.23 of the Revised Code, references to the "federal short-term rate" are references to the federal short-term rate as determined by the tax commissioner under this section rounded to the nearest whole number per cent.

(C) Within ten days after the interest rate per annum is determined under this section, the tax commissioner shall notify the auditor of each county in writing of that rate of interest.

Sec. 5703.50.  As used in sections 5703.50 to 5703.53 ofthe Revised Code:

(A) "Tax" includes only those taxes imposed on tangiblepersonal property listed in accordance with Chapter 5711. of theRevised Code and taxes imposed under Chapters 5733., 5739.,5741., and 5747., and 5751. of the Revised Code.

(B) "Taxpayer" means a person subject to or potentiallysubject to a tax including an employer required to deduct andwithhold any amount under section 5747.06 of the Revised Code.

(C) "Audit" means the examination of a taxpayer or theinspection of the books, records, memoranda, or accounts of ataxpayer for the purpose of determining liability for a tax.

(D) "Assessment" means a notice of underpayment ornonpayment of a tax issued pursuant to section 5711.26, 5711.32,5733.11, 5739.13, 5741.11, 5741.13, or 5747.13, or 5751.09 of the RevisedCode.

(E) "County auditor" means the auditor of the county inwhich the tangible personal property subject to a tax is located.

Sec. 5703.70. (A) On the filing of an application for refundunder section 3734.905, 4307.05, 4307.07, 5727.28, 5727.91,5728.061, 5733.12, 5735.122, 5735.13, 5735.14, 5735.141, 5735.142,5735.18, 5739.07, 5739.071, 5739.104, 5741.10, 5743.05, 5743.53,or5749.08, or 5751.08 of theRevised Code, or an application for compensation under section 5739.123 of the Revised Code, if the tax commissioner determinesthat the amountof the refund or compensation to which the applicant is entitledis less than theamount claimed in the application, thecommissioner shall givetheapplicant written notice by ordinarymail of the amount. Thenotice shall be sent to the address shownon the application unless the applicant notifies thecommissioner of adifferent address. The applicant shall havesixty daysfrom thedate thecommissioner mails the notice toprovideadditionalinformation tothe commissioner or request ahearing,or both.

(B) If the applicant neither requests a hearing nor providesadditional information to the tax commissioner within the timeprescribed by division (A) of this section, the commissioner shalltake no further action, and the refund amount or compensation amount denied becomesfinal.

(C)(1) If the applicant requests a hearing within the timeprescribed by division (A) of this section, the tax commissionershall assign a time and place for the hearing and notify theapplicant of such time and place, but the commissioner maycontinue the hearing fromtime to time as necessary. After thehearing, the commissionermay make such adjustments to the refund or compensationas the commissioner findsproper, and shall issue a finaldetermination thereon.

(2) If the applicant does not request a hearing, butprovides additional information, within the time prescribed bydivision (A) of this section, the commissioner shall review theinformation, make such adjustments to the refund or compensation as thecommissioner finds proper, and issue a final determinationthereon.

(3) The commissioner shall serve a copy of the finaldetermination made under division (C)(1) or (2) of this section onthe applicant in the manner provided in section 5703.37 of theRevised Code,and the decision is final, subject to appeal undersection 5717.02of the Revised Code.

(D) The tax commissioner shall certify to the director ofbudget and management and treasurer of state for payment from thetax refund fund created by section 5703.052 of the Revised Code,the amount of the refund to be refunded under division (B) or (C) of thissection. The commissioner also shall certify to the director and treasurer of state for payment from the general revenue fund the amount of compensation to be paid under division (B) or (C) of this section.

Sec. 5703.80. There is hereby created in the state treasury the property tax administration fund. All money to the credit of the fund shall be used to defray the costs incurred by the department of taxation in administering the taxation of property and the equalization of real property valuation.

Each fiscal year between the first and fifteenth days of July, the tax commissioner shall compute the following amounts for the property in each taxing district in each county, and certify to the director of budget and management the sum of those amounts for all taxing districts in all counties:

(A) Three-tenths For fiscal year 2006, thirty-three hundredths of one per cent of the total amount by which taxes charged against real property on the general tax list of real and public utility property were reduced under section 319.302 of the Revised Code for the preceding tax year;

(B) Fifteen-hundredths For fiscal year 2007 and thereafter, thirty-five hundredths of one per cent of the total amount by which taxes charged against real property on the general tax list of real and public utility property were reduced under section 319.302 of the Revised Code for the preceding tax year;

(C) For fiscal year 2006, one-half of one per cent of the total amount of taxes charged and payable against public utility personal property on the general tax list of real and public utility property for the preceding tax year and of the total amount of taxes charged and payable against tangible personal property on the general tax list of personal property of the preceding tax year and for which returns were filed with the tax commissioner under section 5711.13 of the Revised Code;

(C) Seventy-five (D) For fiscal year 2007, fifty-six hundredths of one per cent of the total amount of taxes charged and payable against public utility personal property on the general tax list of real and public utility property for the preceding tax year and of the total amount of taxes charged and payable against tangible personal property on the general tax list of personal property of the preceding tax year and for which returns were filed with the tax commissioner under section 5711.13 of the Revised Code;

(E) For fiscal year 2008 and thereafter, six-tenths of one per cent of the total amount of taxes charged and payable against public utility personal property on the general tax list of real and public utility property for the preceding tax year and of the total amount of taxes charged and payable against tangible personal property on the general tax list of personal property of the preceding tax year and for which returns were filed with the tax commissioner under section 5711.13 of the Revised Code.

After receiving the tax commissioner's certification, the director of budget and management shall transfer from the general revenue fund to the property tax administration fund one-fourth of the amount certified on or before each of the following days: the first days of August, November, February, and May.

On or before the thirtieth day of June of the fiscal year, the tax commissioner shall certify to the director of budget and management the sum of the amounts by which the amounts computed for a taxing district under divisions (A), (B), and (C) of this section exceeded the distributions to the taxing district under division (F) of section 321.24 of the Revised Code, and the director shall transfer that sum from the property tax administration fund to the general revenue fund.

Sec. 5705.091.  The board of county commissioners of eachcounty shall establish a county mental retardation anddevelopmental disabilities general fund. Notwithstandingsections5705.09 and 5705.10 of the Revised Code, proceeds fromleviesunder section 5705.222 and division (L) of section 5705.19of theRevised Code shall be deposited to the credit of thecounty mentalretardation and developmental disabilities generalfund. Accountsshall be established within the county mentalretardation anddevelopmental disabilities general fund for eachof the severalparticular purposes of the levies as specified inthe resolutionsunder which the levies were approved, andproceeds from differentlevies that were approved for the sameparticular purpose shall becredited to accounts for thatpurpose. Other money received bythe county for the purposes ofChapters 3323. and 5126. of theRevised Code and not required bystate or federal law to bedeposited to the credit of a differentfund shall also bedeposited to the credit of the county mentalretardation anddevelopmental disabilities general fund, in anaccount appropriateto the particular purpose for which the moneywas received.Unlessotherwise provided by law, an unexpendedbalance at the endof afiscal year in any account in the countymental retardationanddevelopmental disabilities general fundshall be appropriatedthenext fiscal year to the same fund.

A county board of mental retardation and developmentaldisabilities may request, by resolution, that the board of countycommissioners establish a county mental retardation anddevelopmental disabilities capital fund for money to be used foracquisition, construction, or improvement of capital facilitiesoracquisition of capital equipment used in providing services tomentally retarded and developmentally disabled persons. Thecounty board of mental retardation and developmental disabilitiesshall transmit a certified copy of the resolution to the board ofcounty commissioners. Upon receiving the resolution, the boardofcounty commissioners shall establish a county mentalretardationand developmental disabilities capital fund.

A county board shall request, by resolution, that the boardof county commissioners establish a county MR/DD medicaid reservefund. Onreceipt of the resolution, the board of countycommissioners shallestablish a county MR/DD medicaid reservefund. The portion offederal revenue funds that the county boardearns for providing habilitation center services,medicaid casemanagement services, and home and community-basedservices that isneeded for the county board to pay forextraordinary costs,including extraordinary costs for services toindividuals withmental retardation or other developmentaldisability, and ensurethe availability of adequate funds in theevent a county propertytax levy for services for individuals withmental retardation orother developmental disability fails shallbe deposited into thefund. The county board shall use money inthe fund for thosepurposes in accordance with rules adopted under section 5123.0413of the Revised Code.

Sec. 5705.211.  (A) As used in this section:

(1) "Adjusted charge-off amount" for a fiscal year means two and three-tenths per cent of a school district's recognized valuation, as defined in section 3317.02 of the Revised Code, for the fiscal year.

(2) "Charge-off increase" for a tax year means the dollar amount, if any, by which the adjusted charge-off amount for the fiscal year ending in the preceding tax year exceeds the adjusted charge-off amount for the fiscal year ending in the current tax year.

(3) "Levies for current expenses" means any tax levied in excess of the ten-mill limitation for the current operating expenses of the district and any tax levied under sections 5705.194 to 5709.197 of the Revised Code.

(4) "Taxes charged and payable" means the taxes charged and payable from a tax levy extended on the real and public utility property tax list and the general list of personal property after any reduction under section 319.301 of the Revised Code but before any reduction under section 319.302, 323.152, or 323.158 of the Revised Code.

(B) The board of education of a city, local, or exempted village school district may adopt a resolution proposing the levy of a tax in excess of the ten-mill limitation for the purpose of paying the current operating expenses of the district. If the resolution is approved as provided in division (D) of this section, the tax may be levied at such a rate each year that the total taxes charged and payable from the levy equals the charge-off increase for the fiscal year or equals a lesser amount as prescribed under division (C) of this section. The tax may be levied for a continuing period of time or for a specific number of years, but not fewer than five years, as provided in the resolution. The tax may not be placed on the tax list for a tax year beginning before the first day of January following adoption of the resolution. A board of education may not adopt a resolution under this section proposing to levy a tax under this section concurrently with any other tax levied by the board under this section.

(C) After the first year a tax is levied under this section, the rate of the tax in any year shall not exceed the rate, estimated by the county auditor, that would cause the total taxes charged and payable from all the school district's property tax levies for current expenses, including the tax levied under this section, to exceed, if levied upon the total taxable value of real and personal property listed and assessed for taxation in the preceding year, one hundred four per cent of the taxes charged and payable from the same levies imposed in the preceding year. A board of education imposing a tax under this section may specify in the resolution imposing the tax that the percentage shall be less than one hundred four per cent, but the percentage shall not be less than one hundred per cent. At any time after a resolution adopted under this section is approved by a majority of electors as provided in division (D) of this section, the board of education, by resolution, may decrease the percentage specified in the resolution levying the tax.

For the purposes of this division, a renewal of a levy that was imposed in the preceding year is the same as the levy being renewed to the extent the rate of the renewal levy does not exceed the rate of the levy being renewed. A replacement of a levy that was imposed in the preceding year is the same as the replaced levy to the extent the effective rate of the replacement levy does not exceed the effective rate of the replaced levy in the last year the replaced levy was imposed. For the purposes of this division, "effective rate" of a levy equals the total of the taxes charged and payable from the levy divided by the taxable value of all real and tangible personal property subject to the levy.

(D) A resolution adopted under this section shall state that the purpose of the tax is to pay current operating expenses of the district, and shall specify the first year in which the tax is to be levied, the number of years the tax will be levied or that it will be levied for a continuing period of time, and the election at which the question of the tax is to appear on the ballot, which shall be a general or special election consistent with the requirements of section 3501.01 of the Revised Code. If the board of education specifies a percentage less than one hundred four per cent pursuant to division (C) of this section, the percentage shall be specified in the resolution.

Upon adoption of the resolution, the board of education may certify a copy of the resolution to the proper county board of elections. The copy of the resolution shall be certified to the board of elections not later than seventy-five days before the day of the election at which the question of the tax is to appear on the ballot. Upon receiving a timely certified copy of such a resolution, the board of elections shall make the necessary arrangements for the submission of the question to the electors of the school district, and the election shall be conducted, canvassed, and certified in the same manner as regular elections in the school district for the election of members of the board of education. Notice of the election shall be published in one or more newspapers of general circulation in the school district once per week for four consecutive weeks. The notice shall state that the purpose of the tax is for the current operating expenses of the school district, the first year the tax is to be levied, the number of years the tax is to be levied or that it is to be levied for a continuing period of time, that the tax is to be levied each year in an amount estimated to offset decreases in state base cost funding caused by increases in the district's taxable property valuation, and that the estimated additional tax in any year of the levy shall not cause the taxes charged and payable for school operating expenses to exceed the previous year's by more than one hundred four per cent, or a lesser percentage specified in the resolution levying the tax, except for increases caused by the addition of new taxable property.

The question shall be submitted as a separate proposition but may be printed on the same ballot with any other proposition submitted at the same election other than the election of officers.

The form of the ballot shall be substantially as follows:

"An additional tax for the benefit of (name of school district) for the purpose of paying the current operating expenses of the district, for .......... (number of years or for continuing period of time), at a rate sufficient to offset any reduction in basic state funding caused by increases in the district's taxable property valuation, but limited to prevent total revenue for the district's operating expenses from increasing by more than ..... per cent per year?

If a majority of the electors of the school district voting on the question vote in favor of the question, the board of elections shall certify the results of the election to the board of education and to the tax commissioner immediately after the canvass.

(E) When preparing any estimate of the contemplated receipts from a tax levied pursuant to this section for the purposes of sections 5705.28 to 5705.40 of the Revised Code, and in preparing to certify the tax under section 5705.34 of the Revised Code, a board of education authorized to levy such a tax shall use information supplied by the department of education to determine the charge-off increase for the tax year for which that certification is made. If the board levied a tax under this section in the preceding tax year, the sum to be certified for collection from the tax shall not exceed the sum that would exceed the limitation imposed under division (C) of this section. At the request of the board of education or the treasurer of the school district, the county auditor shall assist the board of education in determining the rate or sum that may be levied under this section.

The board of education shall certify the sum authorized to be levied to the county auditor, and, for the purpose of the county auditor determining the rate at which the tax is to be levied in the tax year, the sum so certified shall be the sum to be raised by the tax unless the sum exceeds the limitation imposed by division (C) of this section. A tax levied pursuant to this section shall not be levied at a rate in excess of the rate estimated by the county auditor to produce the sum certified by the board of education after the reduction required under section 319.301 of the Revised Code but before the reductions under sections 319.302, 323.152, and 323.158 of the Revised Code. Notwithstanding section 5705.34 of the Revised Code, a board of education authorized to levy a tax under this section shall certify the tax to the county auditor before the first day of October of the tax year in which the tax is to be levied, or at a later date as approved by the tax commissioner.

Sec. 5705.391.  (A) A board of education shall adopt aspartofits annual appropriation measure a spending plan or in thecaseof an amendment or supplement to an appropriation measure, anamended spending plan, setting forth a schedule of expenses andexpenditures of all appropriated funds by the school district forthe fiscal year. A copy of the annual appropriation measure andany amendment or supplement to it and the spending plan oramendedplan shall be submitted to the superintendent of publicinstruction and shall set forth all revenues available forappropriation by the district during the fiscal year and theirsources; the nature and amount of expenses to be incurred by thedistrict during such year, the outstanding and unpaid expenses onthe date the appropriation measure, amendment, or supplement isadopted; the date or dates by which such expenses must be paid;and such other information as the superintendent requires toenable the superintendent to determine whether during suchyearthe districtwill incur any expenses that will impair its abilityto operateits schools with the revenue available to it fromexistingrevenue sources. The plan or amended plan shall bepresented insuch detail and form as the superintendentprescribes.

(B)(A) No later than July 1, 1998, the department ofeducationand the auditor of state shall jointly adopt rules requiringschooldistricts to include boards of education to submit five-year projections of operational revenues andexpenditures in thespending plan required by this section. Therules shall provide for theauditorof state or the department toexamine the five-year projectionsand to determine whether anyfurther fiscal analysis is needed to ascertainwhether a districthas the potential to incur a deficit during the first threeyearsof the five-year period.

The auditorof state or the department may conduct anyfurther auditsor analyses necessary to assess any district'sfiscal condition. If further audits or analyses are conductedbythe auditor of state, the auditor of state shall notify thedepartment of the district's fiscal condition, and the departmentshallimmediately notifythe district of any potential toincur adeficit in thecurrent fiscal year orof any strongindicationsthat a deficit will be incurred in either of theensuing twoyears.If such audits or analyses are conducted by thedepartment,the department shall immediately notify the districtand theauditor of state of such potential deficit or strongindicationsthereof.

A district notified under this section shall take immediatesteps toeliminate any deficit in the current fiscal year andshall begin to plan toavoid the projected future deficits.

(C)(B) The state board of education, in accordance withsections3319.31 and 3319.311 of the Revised Code, may limit,suspend, or revoke a license as definedundersection 3319.31 ofthe Revised Code that has been issued to any school employee foundto havewillfully contributed erroneous, inaccurate, or incompletedata required forthe submission of the appropriation measure andspending plan five-year projection required by thissection.

Sec. 5705.40.  Any appropriation ordinance or measure maybe amended or supplemented, provided that such amendment orsupplement shall comply with all provisions of law governing thetaxing authority in making an original appropriation and that noappropriation for any purpose shall be reduced below an amountsufficient to cover all unliquidated and outstanding contracts orobligations certified from or against the appropriation.Transfers may be made by resolution or ordinance from oneappropriation item to another, except that a board of county commissioners shall, at the request of the county board of elections, adopt a resolution to transfer funds from one appropriation item of the board of elections to another appropriation item of the board of elections unless the board of county commissioners determines that the transfer is sought for the purpose of providing employee bonuses or salary increases other than increases necessary to reimburse employees for overtime worked. At the close of each fiscal year,the unencumbered balance of each appropriation shall revert tothe respective fund from which it was appropriated and shall besubject to future appropriations, provided that funds unexpendedat the end of such fiscal year previously appropriated for thepayment of obligations unliquidated and outstanding, orpreviously appropriated pursuant to section 321.261 of theRevised Code for the collection of delinquent taxes, need not bereappropriated, but such unexpended funds shall not be includedby any budget-making body or board or any county budgetcommission in estimating the balance available for the purposesof the next or any succeeding fiscal year.

The annual appropriation measure, or an amendment orsupplement thereto, may contain an appropriation forcontingencies not to exceed the amount authorized by section5705.29 of the Revised Code and in the case of a school districtmay also include a voluntary contingency reserve balance in theamount authorized by such section. By a two-thirds vote of allmembers of the taxing authority of a subdivision or taxing unit,expenditures may be authorized in pursuance of such contingencyappropriation or voluntary contingency reserve balance for anylawful purpose for which public funds may be expended, if suchpurpose could not have reasonably been foreseen at the time ofthe adoption of the appropriation measure or, in the case of avoluntary contingency reserve balance, if the board of educationrequests payment of any portion of such balance.

Sec. 5707.031.  (A) As used in this section:

(1) "Qualifying dealer in intangibles" has the same meaning as "qualifying dealer" in section 5725.24 of the Revised Code;

(2) "Tax otherwise due" means the tax imposed on a qualifying dealer in intangibles under section 5707.03 and Chapter 5725. of the Revised Code reduced by the total amount of all other nonrefundable credits, if any, that the qualifying dealer in intangibles is entitled to claim.

(B) Upon the issuance of a tax credit certificate by the Ohio venture capital authority under section 150.07 of the Revised Code, a credit may be claimed against the tax imposed on a qualifying dealer in intangibles under section 5707.03 and Chapter 5725. of the Revised Code. The credit shall be claimed on a return due under section 5725.14 of the Revised Code after the certificate is issued by the authority.

(C) If the qualifying dealer in intangibles elected a refundable credit under section 150.07 of the Revised Code and if the amount of the credit shown on the certificate does not exceed the tax otherwise due, then for the calendar year the qualifying dealer in intangibles shall claim a refundable credit equal to the amount of the credit shown on the certificate.

(D) If the qualifying dealer in intangibles elected a refundable credit under section 150.07 of the Revised Code, and if the amount of the refundable credit shown on the certificate exceeds the tax otherwise due, then for the calendar year the qualifying dealer in intangibles shall claim a refundable credit equal to the sum of the following:

(1) The amount, if any, of the tax otherwise due;

(2) Seventy-five per cent of the difference between the amount of the refundable credit shown on the certificate and the tax otherwise due.

(E) If the qualifying dealer in intangibles elected a nonrefundable credit under section 150.07 of the Revised Code and if the nonrefundable credit to which the qualifying dealer in intangibles would otherwise be entitled under this section for any calendar year is greater than the tax otherwise due, the excess shall be allowed as a nonrefundable credit in each of the ensuing ten calendar years, but the amount of any excess nonrefundable credit allowed in the ensuing calendar year shall be deducted from the balance carried forward to the next calendar year.

Sec. 5709.07.  (A) The following property shall be exemptfrom taxation:

(1) Public schoolhouses, the books and furniture in them,and the ground attached to them necessary for the properoccupancy, use, and enjoyment of the schoolhouses, and not leasedor otherwise used with a view to profit;

(2) Houses used exclusively for public worship, the booksand furniture in them, and the ground attached to them that isnot leased or otherwise used with a view to profit and that isnecessary for their proper occupancy, use, and enjoyment;

(3) Real property owned and operated by a church that isused primarily for church retreats or church camping, and that isnot used as a permanent residence. Real property exempted underdivision (A)(3) of this section may be made available by thechurch on a limited basis to charitable and educationalinstitutions if the property is not leased or otherwise madeavailable with a view to profit.

(4) Public colleges and academies and all buildingsconnected with them, and all lands connected with publicinstitutions of learning, not used with a view to profit, including those buildings and lands that satisfy all of the following:

(a) The buildings are used for housing for full-time students or housing-related facilities for students, faculty, or employees of a state university, or for other purposes related to the state university's educational purpose, and the lands are underneath the buildings or are used for common space, walkways, and green spaces for the state university's students, faculty, or employees. As used in this division, "housing-related facilities" includes both parking facilities related to the buildings and common buildings made available to students, faculty, or employees of a state university. The leasing of space in housing-related facilities shall not be considered an activity with a view to profit for purposes of division (A)(4) of this section.

(b) The buildings and lands are supervised or otherwise under the control, directly or indirectly, of an organization that is exempt from federal income taxation under section 501(c)(3) of the Internal Revenue Code of 1986, 100 Stat. 2085, 26 U.S.C. 1, as amended, and the state university has entered into a qualifying joint use agreement with the organization that entitles the students, faculty, or employees of the state university to use the lands or buildings;

(c) The state university has agreed, under the terms of the qualifying joint use agreement with the organization described in division (A)(4)(b) of this section, that the state university, to the extent applicable under the agreement, will make payments to the organization in amounts sufficient to maintain agreed-upon debt service coverage ratios on bonds related to the lands or buildings.

(B) This section shall not extend to leasehold estates orreal property held under the authority of a college or universityof learning in this state; but leaseholds, or other estates orproperty, real or personal, the rents, issues, profits, andincome of which is given to a municipal corporation, schooldistrict, or subdistrict in this state exclusively for the use,endowment, or support of schools for the free education of youthwithout charge shall be exempt from taxation as long as suchproperty, or the rents, issues, profits, or income of theproperty is used and exclusively applied for the support of freeeducation by such municipal corporation, district, orsubdistrict. Division (B) of this section shall not apply with respect to buildings and lands that satisfy all of the requirements specified in divisions (A)(4)(a) to (c) of this section.

(C) For purposes of this section, if the requirements specified in divisions (A)(4)(a) to (c) of this section are satisfied, the buildings and lands with respect to which exemption is claimed under division (A)(4) of this section shall be deemed to be used with reasonable certainty in furthering or carrying out the necessary objects and purposes of a state university.

(D) As used in this section, "church":

(1) "Church" means a fellowshipof believers, congregation, society, corporation, convention, orassociation that is formed primarily or exclusively for religiouspurposes and that is not formed for the private profit of anyperson.

(2) "State university" has the same meaning as in section 3345.011 of the Revised Code.

(3) "Qualifying joint use agreement" means an agreement that satisfies all of the following:

(a) The agreement was entered into before June 30, 2004;

(b) The agreement is between a state university and an organization that is exempt from federal income taxation under section 501(c)(3) of the Internal Revenue Code of 1986, 100 Stat. 2085, 26 U.S.C. 1, as amended; and

(c) The state university that is a party to the agreement reported to the Ohio board of regents that the university maintained a headcount of at least twenty-five thousand students on its main campus during the academic school year that began in calendar year 2003 and ended in calendar year 2004.

Sec. 5709.112. For tax year 2006 and each tax year thereafter, all tangible personal property used in the recovery of oil or gas, when installed and located on the premises or leased premises of the owner, shall be exempt from taxation. Such tangible personal property shall be subject to taxation if it is not installed on the premises or leased premises of the owner, or if it is used for the transmission, transportation, or distribution of oil or gas, as provided in section 5711.22 of the Revised Code. The tax commissioner may adopt rules governing the administration of the exemption provided by this section.

This section does not apply to any taxpayer that is required to file a report under section 5727.08 of the Revised Code.

Sec. 5709.12.  (A) As used in this section, "independentliving facilities" means any residential housing facilities andrelated property that are not a nursing home, residentialcarefacility, or adultcare facility as defined in division (A) ofsection 5701.13 ofthe Revised Code.

(B) Lands, houses, and other buildings belonging to acounty, township, or municipal corporation and used exclusivelyfor the accommodation or support of the poor, or leased to thestate or any political subdivision for public purposes shall beexempt from taxation. Real and tangible personal propertybelonging to institutions that is used exclusively for charitablepurposes shall be exempt from taxation, including real propertybelonging to an institution that is a nonprofit corporation thatreceives a grant underthe Thomas Alva Edisongrant programauthorizedby division (C) ofsection 122.33 of the Revised Codeat any timeduring the tax yearand being held for leasing orresale toothers. If, at any time during a tax year for whichsuch propertyis exempted from taxation, the corporation ceases toqualify forsuch a grant, the director of developmentshall notifythe taxcommissioner, and the tax commissioner shallcause theproperty tobe restored to the tax list beginning withthefollowing tax year.All property owned andused by a nonprofitorganizationexclusively for a home for theaged, as defined insection 5701.13of the Revised Code, alsoshall be exempt fromtaxation.

(C)(1) If a home for the ageddescribed in division (B)(1)of section 5701.13 of the Revised Code is operated in conjunctionwithor at the same site as independent living facilities, theexemption granted in division (B) of this section shall includekitchen, dining room, clinic, entry ways, maintenance and storageareas, and land necessary for access commonly used by bothresidents of the home for the aged and residents of theindependent living facilities. Other facilities commonly used byboth residents of the home for the aged and residents ofindependent living units shall be exempt from taxation only iftheother facilities are used primarily by the residents of thehomefor the aged. Vacant land currently unused by the home, andindependent living facilities and the lands connected with themare not exempt from taxation. Except as provided in division (A)(1)of section 5709.121 of the Revised Code, property of a homeleasedfor nonresidential purposes is not exempt from taxation.

(2) Independent living facilities are exempt from taxationif they are operated in conjunction with or at the same site as ahome for the aged described in division (B)(2) of section 5701.13of the Revised Code; operated by a corporation, association, ortrust described in division (B)(1)(b) of that section; operatedexclusively for the benefit of members of the corporation,association, or trust who are retired, aged, or infirm; andprovided to those members without charge in consideration of theirservice, without compensation, to a charitable, religious,fraternal, or educational institution. For the purposes ofdivision (C)(2) of this section, "compensation" does not includefurnishing room and board, clothing, health care, or othernecessities, or stipends or other de minimis payments to defraythe cost thereof.

(D)(1) A private corporation established under federal law,defined in 36 U.S.C. 1101, Pub. L. No. 102-199, 105Stat.1629, asamended, the objects of which include encouraging the advancementof science generally, or of a particular branch of science, thepromotion of scientific research, the improvement of thequalifications and usefulness of scientists, or the increase anddiffusion of scientific knowledge is conclusively presumed to beacharitable or educational institution. A private corporationestablished as a nonprofit corporation under the laws of a state,that is exempt from federal income taxation under section501(c)(3) of the Internal Revenue Code of 1986, 100 Stat. 2085,26U.S.C.A. 1, as amended, and has as its principal purpose oneormore of the foregoing objects, also is conclusively presumedto bea charitable or educational institution.

The fact that an organization described in this divisionoperates in a manner that results in an excess of revenues overexpenses shall not be used to deny the exemption granted by thissection, provided such excess is used, or is held for use, forexempt purposes or to establish a reserve against futurecontingencies; and, provided further, that such excess may not bedistributed to individual persons or to entities that would notbeentitled to the tax exemptions provided by this chapter. Norshall the fact that any scientific information diffused by theorganization is of particular interest or benefit to any of itsindividual members be used to deny the exemption granted by thissection, provided that such scientific information is availabletothe public for purchase or otherwise.

(2) Division (D)(2) of this section does not apply to realproperty exempted from taxation under this section and division(C)(A)(3) of section 5709.121 of the Revised Code and belonging to anonprofit corporation described in division (D)(1) of this sectionthat has received a grant under the Thomas Alva Edison grantprogram authorized by division (C) of section 122.33 of theRevised Code during any of the tax years the property was exemptedfrom taxation.

When a private corporation described in division(D)(1) ofthis sectionsells all or any portion of a tract, lot,or parcelof realestate that has been exempt from taxation underthissection andsection 5709.121 of the Revised Code, the portionsoldshall berestored to the tax list for the year following theyearof thesale and a charge shall be levied against the soldpropertyin anamount equal to the tax savings on such propertyduring thefourtax years preceding the year the property isplaced on thetaxlist. The tax savings equals the amount of theadditionaltaxesthat would have been levied if such property hadnot beenexemptfrom taxation.

The charge constitutes a lien of the state upon suchpropertyas of the first day of January of the tax year in whichthe chargeis levied and continues until discharged as providedby law. Thecharge may also be remitted for all or any portionof suchproperty that the tax commissioner determines is entitledtoexemption from real property taxation for the year suchpropertyis restored to the tax list under any provision of theRevisedCode, other than sections 725.02, 1728.10, 3735.67,5709.40,5709.41, 5709.62, 5709.63, 5709.71, 5709.73, 5709.78,and 5709.84,upon an application for exemption covering the yearsuch propertyis restored to the tax list filed under section5715.27 of theRevised Code.

(E) Real property held by anorganization organized andoperated exclusively for charitablepurposes as described undersection 501(c)(3) of theInternal Revenue Code and exempt fromfederaltaxation under section 501(a) of the InternalRevenueCode, 26 U.S.C.A. 501(a) and(c)(3), asamended, for the purposeof constructing or rehabilitatingresidences for eventual transferto qualified low-incomefamilies through sale, lease, or landinstallment contract,shall be exempt from taxation.

The exemption shall commence on the day title tothe propertyis transferred to the organizationand shall continue to the endof the tax year in whichthe organization transfers title to theproperty to aqualified low-income family. In no case shall theexemption extend beyond thesecond succeeding tax year followingthe year in which the title wastransferred to the organization.If the title is transferred to theorganization and from theorganization to a qualified low-income family in thesame taxyear, the exemption shall continue to the end of that tax year.Theproportionate amount of taxes that are alien but not yetdetermined, assessed, and levied for the tax year in whichtitleis transferred to the organization shall be remitted by thecountyauditor for each day of the year that title is held by theorganization.

Upon transferring the title to another person, theorganization shall filewith the county auditor an affidavitaffirming that the title was transferredto a qualified low-incomefamily or that the title was not transferred to aqualifiedlow-income family, as the case may be; if the title wastransferred to a qualified low-income family, the affidavit shallidentify thetransferee by name. If the organization transferstitle to the propertyto anyone other than aqualified low-incomefamily, the exemption, if it has not previously expired,shallterminate, and the property shall be restored to the tax list fortheyear following the year of the transfer and a charge shall belevied againstthe property in an amount equal to the amount ofadditional taxes that wouldhave been levied if such property hadnot been exempt from taxation. Thecharge constitutes a lien ofthe state upon such property as of the first dayof January of thetax year in which the charge is levied andcontinues untildischarged as provided by law.

The application for exemption shall be filed as otherwiserequiredunder section 5715.27 of the Revised Code, except thattheorganization holding the property shall file with itsapplication documentation substantiating its status as anorganization organized and operated exclusively for charitablepurposes under section 501(c)(3) of theInternal Revenue Code andits qualification forexemption from federal taxation undersection 501(a)of the Internal Revenue Code, and affirming itsintention to construct or rehabilitate the property for theeventual transfer to qualified low-income families.

As used in this division, "qualified low-income family"meansa family whose income does not exceed two hundred per centof theofficial federal poverty guidelines as revised annuallyinaccordance with section 673(2) of the "Omnibus BudgetReconciliation Act of 1981," 95 Stat. 511, 42U.S.C.A. 9902, asamended, for a family size equal to the size of thefamily whoseincome is being determined.

Sec. 5709.121. (A) Real property and tangible personalpropertybelonging to a charitable or educational institution orto thestate or a political subdivision, shall be considered asusedexclusively for charitable or public purposes by suchinstitution,the state, or political subdivision, if it meets oneof thefollowing requirements:

(A)(1) It is used by such institution, the state, orpoliticalsubdivision, or by one or more other such institutions,the state,or political subdivisions under a lease, sublease, orothercontractual arrangement:

(1)(a) As a community or area center in which presentationsinmusic, dramatics, the arts, and related fields are made inorderto foster public interest and education therein;

(2)(b) For other charitable, educational, or public purposes;.

(B)(2) It is made available under the direction or control ofsuch institution, the state, or political subdivision for use infurtherance of or incidental to its charitable,educational, orpublic purposes and not with the view to profit.

(C)(3) It is used by an organization described in division(D)of section 5709.12 of the Revised Code.If the organization is acorporation thatreceives a grant under the Thomas Alva Edisongrant programauthorized by division (C) of section 122.33 of theRevised Codeat any time during the tax year, "used," for thepurposes of thisdivision, includes holding propertyfor lease orresale toothers.

(B)(1) Property described in division (A)(1)(a) of this section shall continue to be considered as used exclusively for charitable or public purposes even if the property is conveyed through one conveyance or a series of conveyances to an entity that is not a charitable or educational institution and is not the state or a political subdivision, provided that all of the following conditions apply with respect to that property:

(a) The property has been listed as exempt on the county auditor's tax list and duplicate for the county in which it is located for the ten tax years immediately preceding the year in which the property is conveyed through one conveyance or a series of conveyances;

(b) The owner to which the property is conveyed through one conveyance or a series of conveyances leases the property through one lease or a series of leases to the entity that owned or occupied the property for the ten tax years immediately preceding the year in which the property is conveyed or an affiliate of such prior owner or occupant;

(c) The property includes improvements that are at least fifty years old;

(d) The property is being renovated in connection with a claim for historic preservation tax credits available under federal law;

(e) The property continues to be used for the purposes described in division (A)(1)(a) of this section after its conveyance; and

(f) The property is certified by the United States secretary of the interior as a "certified historic structure" or certified as part of a certified historic structure.

(2) Notwithstanding section 5715.27 of the Revised Code, an application for exemption from taxation of property described in division (B)(1) of this section may be filed by either the owner of the property or its occupant.

Sec. 5709.40.  (A) As used in this section:

(1)"Blighted area" and "impacted city" have the samemeanings as in section 1728.01 of the Revised Code.

(2) "Business day" means a day of the week excludingSaturday,Sunday, and a legal holiday as defined under section1.14 of the Revised Code.

(3) "Housing renovation" means a project carried out forresidential purposes.

(4) "Improvement" meansthe increase in the assessedvalueof any realproperty that would first appear onthetaxlist andduplicate of real and public utility propertyafter theeffectivedate of an ordinance adoptedunder this section were itnot for theexemptiongrantedby that ordinance. "Improvement"does not include apublicinfrastructure improvement.

(5) "Incentive district" means an area not more than threehundred acres in size enclosed by a continuous boundary in which a project is being, or will be, undertaken andhavingone or more of the following distress characteristics:

(a) At least fifty-one per cent of the residents of thedistrict have incomes of less than eighty per cent of the medianincome of residents of the political subdivision in which thedistrict is located, as determined in the same manner specifiedunder section 119(b) of the "Housing and Community Development Actof 1974," 88 Stat. 633, 42 U.S.C. 5318, as amended;

(b) The average rate of unemployment in the district duringthe most recent twelve-month period for which data are availableis equal to at least one hundred fifty per cent of the averagerate of unemployment for this state for the same period.

(c) At least twenty per cent of the people residing in thedistrict live at or below the poverty level as defined in thefederal Housing and Community Development Act of 1974, 42 U.S.C.5301, as amended, and regulations adopted pursuant to that act.

(d) The district is a blighted area.

(e) The district is in a situational distress area asdesignated by the director of development under division (F) ofsection 122.23 of the Revised Code.

(f) As certified by the engineer for the politicalsubdivision, the public infrastructure serving the district isinadequate to meet the development needs of the district asevidenced by a written economicdevelopment plan or urban renewalplan for the district that has been adopted by the legislativeauthority of thesubdivision.

(g) The district is comprised entirely of unimproved landthat is located in a distressed area as defined in section 122.23of the Revised Code.

(6) "Project" means development activities undertaken on oneor moreparcels, including, but not limited to, construction,expansion,andalteration of buildings or structures, demolition,remediation, and sitedevelopment, and any building or structurethat results from thoseactivities.

(7) "Public infrastructure improvement" includes, but is notlimited to,public roads and highways; water and sewer lines;environmentalremediation; land acquisition, including acquisitionin aid of industry, commerce, distribution, or research;demolition, including demolition on private property whendetermined to be necessary for economic development purposes;stormwater and flood remediation projects, including suchprojects on private property when determined to be necessary forpublic health, safety, and welfare; the provision ofgas,electric, and communications service facilities; and theenhancement of public waterways through improvements that allowfor greater public access. "Public infrastructure improvement" does not include police or fire equipment.

(B) The legislative authority of a municipalcorporation, byordinance, may declare improvements tocertain parcels ofrealpropertylocated in the municipal corporation to be apublicpurpose.Improvements with respect to a parcel that is used or tobe used for residentialpurposesmay bedeclared a public purposeunder thisdivision onlyifthe parcel islocated in a blightedarea of an impacted city.Except asotherwise provided indivision(D) ofthissection, not more than seventy-five per centof animprovementthus declared to be a public purpose may beexemptedfrom realproperty taxation; the percentage exemptedshall not,except asotherwise provided inthat division, exceedtheestimated percentage of theincremental demandplaced on thepublicinfrastructureimprovements that is directly attributabletothe exemptedimprovement. The ordinance shall specify thepercentage of theimprovement to be exempted from taxation.

An ordinance adopted or amended under this division shalldesignate the specific public infrastructure improvements made, tobe made, or inthe process of being made by the municipalcorporation thatdirectly benefit, or that once made will directlybenefit, the parcels for which improvements are declared to be apublic purpose. For the purposes of this division, a publicinfrastructure improvementdirectly benefits such a parcel only ifaproject on the parcel placesdirect, additional demand on thepublic infrastructure improvement or, if thepublic infrastructureimprovement has not yet been completed, will place direct,additional demand on the public infrastructure improvement once itis completed.The service payments provided for in section 5709.42of theRevised Code shall be used to finance the publicinfrastructure improvementsdesignated in the ordinance or for thepurpose described indivision (D)(1) of this section.

(C)(1) The legislative authority of a municipal corporation mayadopt an ordinance creating an incentive district and declaringimprovements to parcels within the district to be a public purposeand, except as provided in division (F) of this section, exempt from taxation as provided in this section, but no legislative authority of a municipal corporation that has a population that exceeds twenty-five thousand, as shown by the most recent federal decennial census, shall adopt an ordinance that creates an incentive district if, as a result of adopting the ordinance, more than twenty-five per cent of the municipal corporation's taxable value, as of the first day of January of the year in which the ordinance takes effect, is subject to an exemption because of an incentive district. The twenty-five per cent limitation does not apply to an incentive district that was created by an ordinance adopted prior to January 1, 2006, unless the legislative authority creates an additional incentive district after that date. Theordinance shall delineate the boundary of the district andspecifically identify each parcel within the district. A districtmay not include any parcel that is or has been exempted fromtaxation under division (B) of this section or that is or has beenwithin another district created under this division. Anordinance may create more than one such district, andmore thanone ordinance may be adopted under this division (C)(1) of this section.

(2) Not later than thirty days prior to adopting an ordinance under this division (C)(1) of this section, if the municipal corporation intends to apply for exemptions from taxation under section 5709.911 of the Revised Code on behalf of owners of real property located within the proposed incentive district, the legislative authority of a municipal corporation shall conduct a public hearing on the proposed ordinance. Not later than thirty days prior to the public hearing, the legislative authority shall give notice of the public hearing and the proposed ordinance by first class mail to every real property owner whose property is located within the boundaries of the proposed incentive district that is the subject of the proposed ordinance.

(3)(a) Anordinance adopted under this division (C)(1) of this section shall specify the life ofthedistrict and the percentage of the improvements to be exemptedand,shall designate the public infrastructure improvements made or,to be made, or in the process of being made,thatbenefit or serve, or, once made, will benefit or serve parcels in the district.The ordinance also shall identify one or more specific projects being, or to be, undertaken in the district that place additional demand on the public infrastructure improvements designated in the ordinance. The project identified may, but need not be, the project under division (C)(3)(b) of this section that places real property in use for commercial or industrial purposes. Except as otherwise permitted under that division, the servicepaymentsprovided for in section 5709.42 of the RevisedCode shallbe usedto finance the designated public infrastructureimprovements or for thepurposedescribed in division (D)(1) ofthis section.

(b) An ordinance adopted under this division (C)(1) of this section may authorize theuse of service payments provided for in section 5709.42 of theRevised Code for the purpose of housing renovations within thedistrict, provided that the ordinance also designates publicinfrastructure improvements that benefit or serve the district,and that a project within the district places real property in usefor commercial or industrial purposes. Service payments may beused to finance or support loans, deferred loans, and grants topersons for the purpose of housing renovations within thedistrict. The ordinance shalldesignate the parcels within thedistrict that are eligible forhousing renovation. The ordinanceshall state separately theamounts or the percentages of theexpected aggregate servicepayments that are designated for eachpublic infrastructureimprovement and for the general purpose ofhousing renovations.

(4) Except withtheapproval of the board of education of eachcity, local, orexempted village school district within theterritory of which thedistrict is or will be located, and subject to division (E) of this section, the life ofa an incentive district shall notexceed ten years, and the percentage ofimprovements to beexempted shall not exceed seventy-five percent. With suchapproval of the board of education, the life of a district may be not morethan thirtyyears, and the percentage of improvements to beexempted may benot more than one hundred per cent.

(5) Approval of a board of education shall be obtained in themanner provided in division (D) of this section for exemptionsunder division (B) of this section, except that the notice to theboard of education shall delineate the boundaries of the district,specifically identify each parcel within the district, identifyeach anticipated improvement in the district, provide an estimateof the true value in money of each such improvement, specify thelife of the district and the percentage of improvements that wouldbe exempted, and indicate the date on which the legislativeauthority intends to adopt the ordinance.

A municipal corporation shall not adopt an ordinance underthis division after June 30, 2007.

(D)(1) If the ordinance declaringimprovements to aparcelto be a public purposeor creating an incentive district specifiesthatpayments in lieu oftaxesprovided for in section 5709.42 ofthe Revised Codeshall bepaidto the city, local, or exemptedvillage school district inwhichthe parcelis located in theamount of the taxes that wouldhavebeen payable to theschooldistrict if the improvements hadnotbeen exempted from taxation,thepercentage of the improvementthat may be exempted fromtaxation may exceedseventy-five percent, and the exemption maybe granted for up to thirtyyears,without theapproval of theboard of education as otherwiserequired under division(D)(2)ofthis section.

(2) Improvementswith respect to a parcel may be exemptedfrom taxationunder division (B) of this section for up totenyears or, with theapproval under this paragraph of the boardofeducation of thecity, local, or exempted village schooldistrictwithin which theparcel islocated, for up to thirty years. Thepercentage of theimprovement exempted from taxation may, withsuch approval,exceedseventy-five per cent, but shall not exceedone hundredper cent.Not later than forty-five business dayspriortoadoptinganordinance under this sectiondeclaringimprovements tobe a publicpurpose that is subject to approval by a board of education under this division, the legislative authorityshalldeliver tothe board ofeducation a notice stating itsintent toadopt an ordinance makingthat declaration. Thenoticeshallidentify the parcels for which improvements are to beexempted from taxation, provide anestimate of the true value inmoney of the improvements, specifythe period forwhich theimprovements would be exempted fromtaxation and the percentage ofthe improvement that would beexempted, and indicatethe date onwhich the legislativeauthority intends toadopt the ordinance.The board of education,by resolutionadopted by a majority of theboard, may approve theexemption forthe period or for theexemption percentage specifiedin thenotice, may disapprove theexemption for the number ofyears inexcess of ten, may disapprovethe exemption for thepercentage ofthe improvement to be exemptedin excess ofseventy-five percent, or both, or may approve theexemption onthe condition thatthe legislative authority and theboardnegotiate an agreementproviding for compensation to theschooldistrict equal in valueto a percentage of the amount oftaxesexempted in the eleventhand subsequent years of theexemptionperiod or, in the case ofexemption percentages inexcess ofseventy-five per cent,compensation equal in value to apercentageof the taxes thatwould be payable on the portion oftheimprovement in excess ofseventy-five per cent were thatportionto be subject totaxation, or other mutually agreeable compensation. The board of education shallcertifyits resolution tothe legislative authority not later thanfourteen days prior tothe date the legislative authority intendsto adopt the ordinanceas indicated in the notice. If the boardof education approvesthe exemption on the condition that acompensation agreement benegotiated, the board in its resolutionshall propose acompensation percentage. If the board ofeducation and thelegislative authority negotiate a mutuallyacceptablecompensation agreement, the ordinance may declare theimprovements a public purpose for the number of years specifiedinthe ordinance or, in the case of exemption percentages inexcessof seventy-five per cent, for the exemption percentagespecifiedin the ordinance. In either case, if the board and thelegislative authority fail to negotiate a mutually acceptablecompensation agreement, the ordinance may declare theimprovementsa public purpose for not more than ten years, butshall not exemptmore than seventy-five per cent of theimprovements from taxation,or, in the case of an ordinance adopted under division (B) of thissection, not more than the estimatedpercentageof the incrementaldemand as otherwiseprescribed by division (B)of thissectionifthat percentage is lessthanseventy-five per cent. If the boardfails to certify aresolutionto the legislative authority withinthe timeprescribed by thisdivision, the legislative authoritythereuponmay adopt theordinance and may declare the improvementsa publicpurpose for upto thirty years, or, in the case ofexemptionpercentages proposedin excess of seventy-five per cent,for theexemption percentagespecified in the ordinance. Thelegislative authority may adoptthe ordinance at any time afterthe board of education certifiesits resolution approving theexemption to the legislativeauthority, or, if the boardapprovesthe exemption on thecondition that a mutuallyacceptablecompensation agreement benegotiated, at any timeafter thecompensation agreement is agreedto by the board andthelegislative authority.

(3) If a board of education has adopted a resolution waivingits right to approve exemptions from taxation and the resolutionremains in effect, approval of exemptions by theboard is notrequired under this division. If a board ofeducation has adopteda resolution allowing a legislativeauthority to deliver thenotice required under this division(D)(2) of this section fewer than forty-five businessdays prior to the legislativeauthority's adoption of theordinance, the legislative authority shall deliverthe notice tothe board not later thanthe number of days prior to such adoptionas prescribed by theboard in its resolution. If a board ofeducation adopts aresolution waiving its right to approveagreements or shorteningthe notification period, the board shallcertify a copy of theresolution to the legislative authority. Ifthe board ofeducation rescinds such a resolution, it shallcertify notice ofthe rescission to the legislative authority.

(4) If the legislative authority is not required bydivision(D)(1), (2), or (3) of thissection to notify theboard ofeducationof the legislative authority's intent to declareimprovements tobe a public purpose, the legislative authorityshall comply withthe notice requirements imposed under section5709.83 of theRevised Code, unless the board has adopted aresolution under thatsection waiving its right to receive such anotice.

(E)(1) If a proposed ordinance under division (C)(1) of this section exempts improvements with respect to a parcel for more than ten years, or the percentage of the improvement exempted from taxation exceeds seventy-five per cent, not later than forty-five business days prior to adopting the ordinance the legislative authority of the municipal corporation shall deliver to the board of county commissioners of the county within which the incentive district is or will be located a notice that states its intent to adopt an ordinance creating an incentive district. The notice shall include a copy of the proposed ordinance.

(2) The board of county commissioners, by resolution adopted by a majority of the board, may object to the exemption for the number of years in excess of ten, may object to the exemption for the percentage of the improvement to be exempted in excess of seventy-five per cent, or both, or may accept either or both exemptions. If the board of county commissioners objects, the board may negotiate an agreement with the legislative authority that provides to the board in the eleventh and subsequent years of the exemption period compensation equal in value to not more than fifty per cent of the taxes that would be payable to the county on the portion of the improvement in excess of seventy-five per cent, were that portion to be subject to taxation. The board of county commissioners shall certify its resolution to the legislative authority not later than thirty days after receipt of the notice.

(3) If the board of county commissioners does not object or fails to certify its resolution objecting to an exemption within thirty days after receipt of the notice, the legislative authority may adopt the ordinance, and no compensation shall be provided to the board of county commissioners. If the board timely certifies its resolution objecting to the ordinance, the legislative authority may adopt the ordinance at any time after the compensation agreement is agreed to by the board and the legislative authority, or, if no compensation agreement is negotiated, at any time after the legislative authority agrees to provide compensation to the board of fifty per cent of the taxes that would be payable to the county in the eleventh and subsequent years of the exemption period on the portion of the improvement in excess of seventy-five per cent, were that portion to be subject to taxation.

(F) Any of the following property tax levies that are enacted on or after January 1, 2006, and after the date an ordinance creating an incentive district is adopted on or after January 1, 2006, under division (C)(1) of this section shall be levied on property that was exempted from taxation under division (C) of this section, and revenues collected from such levies shall not be used to provide service payments under this section:

(1) A tax levied under division (L) of section 5705.19 of the Revised Code for community mental retardation and developmental disabilities programs and services pursuant to Chapter 5126. of the Revised Code;

(2) A tax levied under division (Y) of section 5705.19 of the Revised Code for providing or maintaining senior citizens services or facilities;

(3) A tax levied under section 5705.22 of the Revised Code for county hospitals;

(4) A tax levied under section 5705.221 of the Revised Code for alcohol, drug addiction, and mental health services;

(5) A tax levied under section 5705.23 of the Revised Code for library purposes;

(6) A tax levied under section 5705.24 of the Revised Code for the support of children services and the placement and care of children.

(G) An exemptionfrom taxation granted under thissectioncommenceswith the tax year in which an improvementfirst appearson the tax list and duplicate of real and publicutility propertyand that begins after the effective date of specified in theordinance.Exceptas otherwise provided in this division, theexemption endson thedate specified in the ordinance as thedatethe improvementceasesto be a public purposeor the incentivedistrict expires,orendson the date onwhichthe publicinfrastructureimprovementsandhousing renovations are paid infull from themunicipalpublicimprovement tax incrementequivalent fundestablishedunderdivision (A) of section 5709.43of the RevisedCode,whicheveroccurs first. The exemption of an improvementwith respect to aparcelmay end on a later date, asspecified inthe ordinance, ifthelegislative authority and theboard ofeducation of the city,local, or exempted village schooldistrictwithin which theparcel islocated have entered into acompensation agreementundersection5709.82 of the Revised Codewith respect to theimprovementordistrict andthe board ofeducation has approvedthe term oftheexemptionunder division(D)(2) of this section,but inno case shallthe improvement beexemptedfrom taxation formorethan thirtyyears.Exemptionsshall be claimed andallowedin the samemanner as in the case ofother real propertyexemptions. If anexemption status changesduring a year, theprocedure for theapportionment of the taxesfor that year is thesame as in thecase of other changes in taxexemption statusduring the year.

(F)(H)Additionalmunicipal financing of publicinfrastructureimprovementsandhousing renovations may beprovided byanymethods that themunicipal corporation mayotherwise use forfinancing suchimprovements. If the municipalcorporation issuesbonds or notesto finance the publicinfrastructure improvementsand housingrenovations and pledgesmoney from the municipalpublicimprovement tax incrementequivalent fund to pay theinterest onand principal of the bondsor notes, the bonds ornotes are notsubject to Chapter 133. ofthe Revised Code.

(G)(I) The municipal corporation, not later than fifteendaysafter the adoption ofan ordinanceunder this section, shallsubmit to the director ofdevelopment acopy of the ordinance. Onor before thethirty-first day ofMarchof each year, themunicipal corporationshall submit a statusreport to the directorof development. The report shall indicate, in the mannerprescribed bythe director, the progress ofthe project duringeach year thatan exemption remains ineffect, including asummary of thereceipts from service payments in lieu of taxes;expenditures ofmoney from the funds created under section 5709.43of the RevisedCode; a description of the public infrastructureimprovements andhousing renovations financed with suchexpenditures; and aquantitative summary of changes in employmentand privateinvestment resulting from each project.

(H)(J) Nothing in this section shall be construed to prohibit alegislative authority from declaring to be a public purposeimprovements with respect to more than one parcel.

Sec. 5709.73.  (A) As used in this section and section5709.74 of the Revised Code:

(1) "Business day" means a day of the week excludingSaturday, Sunday, and a legal holiday as defined in section 1.14of theRevised Code.

(2) "Further improvements" or"improvements" means theincrease in the true assessed value ofreal propertythatwould first appearon the tax list and duplicate of real andpublic utility propertyafterthe effective date of a resolutionadopted under this sectionwere it not for the exemption grantedbythat resolution.For purposes ofdivision (B) of this section,"improvements" do not include anyproperty used or to be used forresidentialpurposes.

(3) "Housing renovation" means a project carried out forresidential purposes.

(4) "Incentive district" has the same meaning as in section5709.40 of the Revised Code, except that a blighted area is in theunincorporated area of a township.

(5) "Project" and "public infrastructure improvement" havethe same meanings as in section 5709.40 of the Revised Code.

(B) A board of township trustees may, by unanimousvote,adopt a resolution that declares to be a public purpose anypublicinfrastructureimprovements made that are necessary for thedevelopmentofcertain parcels of land located in theunincorporated area ofthetownship. Except as otherwise providedin division(D) ofthis section, the resolution mayexempt fromrealpropertytaxation not more than seventy-five percent offurtherimprovements to a parcel of land which that directlybenefitsfromsuchpublicinfrastructure improvements; thepercentageexempted shallnot, except asotherwise provided indivision(D)ofthis section,exceed the estimatedpercentage of theincrementaldemand placedon the publicinfrastructureimprovements that isdirectly attributable to theexemptedimprovement.For thepurposes of this division, apublicinfrastructure improvementdirectly benefits aparcel of landonly ifaproject on theparcel places direct, additionaldemandon thepublicinfrastructure improvement, or, if the publicinfrastructureimprovement has not yet beenconstructed, willplace direct,additional demand on the publicinfrastructureimprovement whencompleted. The resolution shall specify thepercentage of thefurther improvements to be exempted.

(C)(1) A board of township trustees may adopt, by unanimousvote, a resolution creating an incentive district and declaringimprovements to parcels within the district to be a public purposeand, except as provided in division (F) of this section, exempt from taxation as provided in this section, but no board of township trustees of a township that has a population that exceeds twenty-five thousand, as shown by the most recent federal decennial census, shall adopt a resolution that creates an incentive district if, as a result of adopting the resolution, more than twenty-five per cent of the township's taxable value, as of the first day of January of the year in which the resolution takes effect, is subject to exemption because of an incentive district. The twenty-five per cent limitation does not apply to an incentive district that was created by a resolution adopted prior to January 1, 2006, unless the board creates an additional incentive district after that date. Thedistrict shall be located within the unincorporated area of thetownship and shall not include any territory that is includedwithin a district created under division (B) of section 5709.78 ofthe Revised Code. The resolution shall delineate the boundary ofthe district and specifically identify each parcel within thedistrict. A district may not include any parcel that is or hasbeen exempted from taxation under division (B) of this section orthat is or has been within another district created under thisdivision. A resolution may create more than one such district,and more than one resolution may be adopted under this division (C)(1) of this section.

(2) Not later than thirty days prior to adopting a resolution under this division (C)(1) of this section, if the township intends to apply for exemptions from taxation under section 5709.911 of the Revised Code on behalf of owners of real property located within the proposed incentive district, the board shall conduct a public hearing on the proposed resolution. Not later than thirty days prior to the public hearing, the board shall give notice of the public hearing and the proposed resolution by first class mail to every real property owner whose property is located within the boundaries of the proposed incentive district that is the subject of the proposed resolution.

(3)(a) A resolution under this division (C)(1) of this section shall specify the life ofthe district and the percentage of the improvements to be exemptedand, shall designate the public infrastructure improvements made or,to be made, or in the process of being made,that benefit or serve, or, once made, will benefit or serve parcels in the district. The resolution also shall identify one or more specific projects being, or to be, undertaken in the district that place additional demand on the public infrastructure improvements designated in the resolution. The project identified may, but need not be, the project under division (C)(3)(b) of this section that places real property in use for commercial or industrial purposes.

(b) A resolution adopted under this division (C)(1) of this section may authorize theuse of service payments provided for in section 5709.74 of theRevised Code for the purpose of housing renovations within thedistrict, provided that the resolution also designates publicinfrastructure improvements that benefit or serve the district,and that a project within the district places real property in usefor commercial or industrial purposes. Service payments may beused to finance or support loans, deferred loans, and grants topersons for the purpose of housing renovations within thedistrict. The resolution shalldesignate the parcels within thedistrict that are eligible forhousing renovations. Theresolution shall state separately theamount or the percentages ofthe expected aggregate servicepayments that are designated foreach public infrastructureimprovement and for the purpose ofhousing renovations.

(4) Except with theapproval of the board of education of eachcity, local, orexempted village school district within theterritory of which thedistrict is or will be located, and subject to division (E) of this section, the life ofa an incentive district shall notexceed ten years, and the percentage ofimprovements to beexempted shall not exceed seventy-five percent. With suchapproval of the board of education, the life of a district may be not morethan thirtyyears, and the percentage of improvements to beexempted may benot more than one hundred per cent.

(5) Approval of a board of education shall be obtained in themanner provided in division (D) of this section for exemptionsunder division (B) of this section, except that the notice to theboard of education shall delineate the boundaries of the district,specifically identify each parcel within the district, identifyeach anticipated improvement in the district, provide an estimateof the true value in money of each such improvement, specify thelife of the district and the percentage of improvements that wouldbe exempted, and indicate the date on which the board of townshiptrustees intends to adopt the resolution.

A board of township trustees shall not adopt a resolutionunder this division after June 30, 2007.

(D) Improvementswith respect to a parcel may be exemptedfrom taxationunder division (B) of this section for up totenyears or, with theapproval of the board of education of thecity,local, or exemptedvillage school district withinwhich theparcel is located, forup tothirtyyears. The percentage of theimprovements exemptedfromtaxationmay, with such approval,exceed seventy-five percent,but shallnot exceed one hundred percent. Not later thanforty-fivebusiness days prior to adopting aresolution under thissectiondeclaring improvements to be apublic purpose that is subject to approval by a board of education under this division,the boardoftrustees shall deliver to the boardof education anoticestatingits intent toadopt a resolutionmaking that declaration.Thenotice shallidentify the parcelsfor which improvements are to be exempted from taxation,providean estimate of the true value in money oftheimprovements,specify the period for which the improvementswouldbe exemptedfromtaxation and the percentage of theimprovementsthat would beexempted, andindicate the date onwhich the boardof trusteesintends to adopt theresolution. Theboard ofeducation, byresolution adopted by amajority of theboard, mayapprove theexemption for the periodor for theexemptionpercentage specifiedin the notice, maydisapprove theexemptionfor the number ofyears in excess often, may disapprovetheexemption for thepercentage of theimprovements to beexempted inexcess ofseventy-five per cent,or both, or mayapprove theexemption onthe condition that theboard of trusteesand theboard ofeducation negotiate anagreement providing forcompensation to theschool district equalin value to a percentageof the amount oftaxes exempted in theeleventh and subsequentyears of theexemption period or, in thecase of exemptionpercentages inexcess of seventy-five per cent,compensation equalin value to apercentage of the taxes thatwould be payable on theportion ofthe improvements in excess ofseventy-five per centwere thatportion to be subject totaxation, or other mutually agreeable compensation. The board ofeducation shallcertify its resolution tothe board of trusteesnot later thanfourteen days prior to thedate the board oftrustees intends toadopt the resolution asindicated in thenotice. If the board ofeducation approves theexemption on thecondition that acompensation agreement benegotiated, the boardof education inits resolution shallpropose a compensationpercentage. If theboard of education andthe board of trusteesnegotiate a mutuallyacceptablecompensation agreement, theresolution may declare theimprovements a public purpose for thenumber of years specifiedinthe resolution or, in the case ofexemption percentages inexcessof seventy-five per cent, for theexemption percentagespecifiedin the resolution. In either case,if the board ofeducation andthe board of trustees fail tonegotiate a mutuallyacceptablecompensation agreement, theresolution may declare theimprovements a public purpose for notmore than ten years, butshall not exempt more than seventy-fiveper cent of theimprovements from taxation, or, in the case of aresolutionadopted under division (B) of this section, not morethan theestimatedpercentageof the incremental demand asotherwiseprescribed by division (B) of thissectionif that percentage islessthan seventy-fiveper cent. If the board of education failstocertify a resolutionto the board of trustees within the timeprescribed by thissection, the board of trustees thereupon mayadopt the resolutionand may declare the improvements a publicpurpose for up to thirtyyears or, in the case of exemptionpercentages proposed in excessof seventy-five per cent, for theexemption percentage specifiedin the resolution. The board oftownship trustees may adopt theresolution at any time after theboard of education certifies itsresolution approving theexemption to the board of townshiptrustees, or, if the board ofeducation approves the exemption onthe condition that amutuallyacceptable compensation agreement benegotiated, at anytime afterthe compensation agreement is agreedto by the boardof educationand the board of township trustees.

If a board of education has adopted a resolution waivingitsright to approve exemptions from taxation and the resolutionremains in effect, approval of such exemptions by the board ofeducation is not required underthis division. If aboard ofeducation has adopted a resolutionallowing a board oftownshiptrustees to deliver the noticerequired underthis division fewerthanforty-five business days prior to adoption of the resolutionbythe boardof township trustees, the board oftownship trusteesshall deliver the notice to the board ofeducation not later thanthe number of days prior to suchadoption as prescribed by theboard of education in itsresolution. If a board of educationadopts a resolution waivingits right to approve exemptions orshortening the notificationperiod, the board of education shallcertify a copy of theresolution to the board of townshiptrustees. If the board ofeducation rescinds such a resolution,it shall certify notice ofthe rescission to the board of townshiptrustees.

If the board of trustees is not required bythisdivision tonotify the board of educationof theboard of trustees' intent todeclare improvements to be apublicpurpose, the board of trusteesshall comply with the noticerequirements imposed under section5709.83 of the Revised Codebefore taking formal action to adoptthe resolution making thatdeclaration, unless the board ofeducation has adopted aresolutionunder that section waiving itsright to receive such anotice.

(E)(1) If a proposed resolution under division (C)(1) of this section exempts improvements with respect to a parcel for more than ten years, or the percentage of the improvement exempted from taxation exceeds seventy-five per cent, not later than forty-five business days prior to adopting the ordinance the board of township trustees shall deliver to the board of county commissioners of the county within which the incentive district is or will be located a notice that states its intent to adopt a resolution creating an incentive district. The notice shall include a copy of the proposed resolution.

(2) The board of county commissioners, by resolution adopted by a majority of the board, may object to the exemption for the number of years in excess of ten, may object to the exemption for the percentage of the improvement to be exempted in excess of seventy-five per cent, or both, or may accept either or both exemptions. If the board of county commissioners objects, the board may negotiate an agreement with the board of township trustees that provides to the board of county commissioners in the eleventh and subsequent years of the exemption period compensation equal in value to not more than fifty per cent of the taxes that would be payable to the county on the portion of the improvement in excess of seventy-five per cent, were that portion to be subject to taxation. The board of county commissioners shall certify its resolution to the board of township trustees not later than thirty days after receipt of the notice.

(3) If the board of county commissioners does not object or fails to certify its resolution objecting to an exemption within thirty days after receipt of the notice, the board of township trustees may adopt its resolution, and no compensation shall be provided to the board of county commissioners. If the board of county commissioners timely certifies its resolution objecting to the trustees' resolution, the board of township trustees may adopt its resolution at any time after the compensation agreement is agreed to by the board of county commissioners and the board of township trustees, or, if no compensation agreement is negotiated, at any time after the board of township trustees agrees to provide compensation to the board of county commissioners of fifty per cent of the taxes that would be payable to the county in the eleventh and subsequent years of the exemption period on the portion of the improvement in excess of seventy-five per cent, were that portion to be subject to taxation.

(F) Any of the following property tax levies that are enacted on or after January 1, 2006, and after the date an ordinance creating an incentive district is adopted on or after January 1, 2006, under division (C)(1) of this section shall be levied on property that was exempted from taxation under division (C) of this section and revenues collected from such levies shall not be used to provide service payments under this section:

(1) A tax levied under division (L) of section 5705.19 of the Revised Code for community mental retardation and developmental disabilities programs and services pursuant to Chapter 5126. of the Revised Code;

(2) A tax levied under division (Y) of section 5705.19 of the Revised Code for providing or maintaining senior citizens services or facilities;

(3) A tax levied under section 5705.22 of the Revised Code for county hospitals;

(4) A tax levied under section 5705.221 of the Revised Code for alcohol, drug addiction, and mental health services;

(5) A tax levied under section 5705.23 of the Revised Code for library purposes;

(6) A tax levied under section 5705.24 of the Revised Code for the support of children services and the placement and care of children.

(G) An exemptionfrom taxation granted under thissectioncommenceswith the tax year in which an improvementfirst appearson the tax list and duplicate of real and publicutility propertyand specified in the resolution that begins after the effective date of theresolution.Except as otherwise provided in this division,the exemption endson the date specified in the resolution asthedate theimprovement ceases to be a public purposeor theincentivedistrict expires, or endson thedate on whichthepublicinfrastructure improvementsand housing renovations arepaid infull fromthetownship publicimprovement tax incrementequivalentfundestablished undersection 5709.75 of the RevisedCode,whicheveroccurs first. The exemption of an improvement withrespect to a parcel may end on alater date, asspecified in theresolution, if the board oftownship trustees andthe boardofeducation of the city, local,or exempted villageschooldistrictwithin whichthe parcel is locatedhave entered into acompensation agreementundersection 5709.82of the Revised Codewith respect to theimprovementor districtand the board ofeducation has approvedthe term ofthe exemptionunder division(D) of thissection, but inno case shallthe improvement beexemptedfrom taxation for morethan thirtyyears. The board oftownshiptrustees may, bymajority vote,adopt a resolutionpermitting thetownship to enterinto suchagreements as the boardfindsnecessary or appropriateto providefor the constructionorundertaking ofpublicinfrastructure improvementsand housingrenovations. Anyexemption shallbe claimed and allowedin thesame or a similarmanner as in thecase of other realpropertyexemptions. If anexemption statuschanges during a taxyear, theprocedure for theapportionment ofthe taxes for thatyear is thesame as in thecase of otherchanges in tax exemptionstatusduring the year.

(F)(H) The boardof township trustees may issue the notes ofthe township to financeall costs pertaining to the constructionor undertaking of publicinfrastructure improvementsand housingrenovations made pursuant to this section. The notesshall besigned by theboard and attested by the signature of thetownshipclerk, shallbear interest not to exceed the rateprovided insection 9.95 ofthe Revised Code, and are not subjectto Chapter133. of theRevised Code. The resolution authorizingthe issuanceof thenotes shall pledge the funds of the townshippublicimprovementtax increment equivalent fund establishedpursuant tosection5709.75 of the Revised Code to pay theinterest on andprincipalof the notes. The notes, which maycontain a clausepermittingprepayment at the option of the board,shall be offeredfor saleon the open market or given to thevendor or contractorif nosale is made.

(G)(I) The township, not later than fifteen days after theadoption of a resolution under thissection, shall submit to thedirector of development a copy oftheresolution. On or beforethe thirty-first day of Marchof eachyear,the township shallsubmit a status report to the directorofdevelopment. Thereport shall indicate, in the mannerprescribed by the director,the progress of the project duringeachyear that the exemptionremains in effect, including asummary of the receipts fromservice payments in lieu of taxes;expenditures of money fromfunds created under section 5709.75 ofthe Revised Code; adescription of the public infrastructureimprovementsand housingrenovations financed with suchexpenditures; and a quantitativesummary ofchanges in private investment resultingfrom eachproject.

(H)(J) Nothing in this section shall be construed to prohibit aboard of township trustees from declaring to be a public purposeimprovements with respect to more than one parcel.

(I)(K) A board of township trustees that adopted a resolutionunder this section prior to July 21, 1994, may amend thatresolution to include any additional public infrastructureimprovement. A board of township trustees that seeks by such anamendment to utilize money from its township public improvementtax increment equivalent fund for land acquisition in aid ofindustry, commerce, distribution, or research, demolition onprivate property, or stormwater and flood remediation projects maydo so provided that the board currently is a party to ahold-harmless agreement with the board of education of the city,local, or exempted village school district within the territory ofwhich are located the parcels that are subject to an exemption.For the purposes of this division, a "hold-harmless agreement"means an agreement under which the board of township trusteesagrees to compensate the school district for one hundred per centof the tax revenue that the school district would have receivedfrom further improvements to parcels designated in the resolutionwere it not for the exemption granted by the resolution.

Sec. 5709.77.  As used in sections 5709.77 to 5709.81 oftheRevised Code:

(A) "Business day" means a day of the week excludingSaturday, Sunday, and a legal holiday as defined in section1.14of the Revised Code.

(B) "Fund" means to provide for the payment of the debtservice on and the expenses relating to an outstanding obligationof the county.

(C) "Housing renovation" means a project carried out forresidential purposes.

(D) "Improvement" means the increase in the true assessed value of real propertythat would firstappear on the tax listand duplicate of real and public utilityproperty after theeffective date of aresolution adopted undersection 5709.78 ofthe Revised Codewere it not for the exemptiongranted by thatresolution. "Improvement"does not include a publicinfrastructureimprovement.For purposes of division (A) ofsection 5709.78 of the Revised Code, "improvement" does notinclude any property used or to be used for residential purposes.

(E) "Incentive district" has the same meaning as in section5709.40 of the Revised Code, except that a blighted area is in theunincorporated territory of a county.

(F) "Refund" means to fund and retire an outstandingobligation of the county.

(G) "Project" and "public infrastructure improvement" havethe same meanings as in section 5709.40 ofthe Revised Code.

Sec. 5709.78.  (A) A board of county commissioners may,byresolution, declare improvements tocertain parcels ofrealpropertylocated in the unincorporated territory of thecounty tobe apublic purpose. Except as otherwise provided indivision(C)of this section, not more thanseventy-five per cent ofanimprovement thus declared to be apublic purpose may beexemptedfrom real property taxation; thepercentage exemptedshall not,except as otherwise provided inthose divisions,exceedtheestimated percentage of theincremental demand placedon thepublic infrastructureimprovements that is directlyattributableto the exemptedimprovement. The resolution shallspecify thepercentage of theimprovement to be exempted.

A resolution adopted under this division shall designatethespecific public infrastructure improvements made, to be made,orin the process of being made by the county that directlybenefit,or that once made will directly benefit, the parcels for whichimprovements are declared to be a public purpose. Forthepurposes of this division, a public infrastructure improvementdirectly benefits such a parcel only if a project on the parcelplacesdirect, additional demand on the public infrastructureimprovementor, if the public infrastructure improvement has notyet beencompleted, will place direct, additional demand on thepublicinfrastructure improvement once it is completed. Theservicepayments provided for in section 5709.79 of the RevisedCode shallbe used to finance the public infrastructureimprovementsdesignated in the resolution.

(B)(1) A board of county commissioners may adopt a resolutioncreating an incentive district and declaring improvements toparcels within the district to be a public purpose and, except as provided in division (E) of this section, exempt fromtaxation as provided in this section, but no board of county commissioners of a county that has a population that exceeds twenty-five thousand, as shown by the most recent federal decennial census, shall adopt a resolution that creates an incentive district if, as a result of adopting the resolution, more than twenty-five per cent of the county's taxable value, as of the first day of January of the year in which the resolution takes effect, is subject to exemption because of an incentive district. The twenty-five per cent limitation does not apply to an incentive district that was created by a resolution adopted prior to January 1, 2006, unless the board creates an additional incentive district after that date. The district shall belocated within the unincorporated territory of the county andshall not include any territory that is included within a districtcreated under division (C) of section 5709.73 of the Revised Code.The resolution shall delineate the boundary of the district andspecifically identify each parcel within the district. A districtmay not include any parcel that is or has been exempted fromtaxation under division (A) of this section or that is or has beenwithin another district created under this division. A resolutionmay create more than one such district, and morethan oneresolution may be adopted under this division (B)(1) of this section.

(2) Not later than thirty days prior to adopting a resolution under this division (B)(1) of this section, if the county intends to apply for exemptions from taxation under section 5709.911 of the Revised Code on behalf of owners of real property located within the proposed incentive district, the board of county commissioners shall conduct a public hearing on the proposed resolution. Not later than thirty days prior to the public hearing, the board shall give notice of the public hearing and the proposed resolution by first class mail to every real property owner whose property is located within the boundaries of the proposed incentive district that is the subject of the proposed resolution. The board also shall provide the notice by first class mail to the clerk of each township in which the proposed incentive district will be located.

(3)(a) Aresolution under this division (B)(1) of this section shall specify the life ofthedistrict and the percentage of the improvements to be exemptedand,shall designate the public infrastructure improvements made or,to be made, or in the process of being made,thatbenefit or serve, or, once made, will benefit or serve parcels in the district. The resolution also shall identify one or more specific projects being, or to be, undertaken in the district that place additional demand on the public infrastructure improvements designated in the resolution. The project identified may, but need not be, the project under division (B)(3)(b) of this section that places real property in use for commercial or industrial purposes.

(b) A resolution adopted under this division (B)(1) of this section may authorize theuse of service payments provided for in section 5709.79 of theRevised Code for the purpose of housing renovations within thedistrict, provided that the resolution also designates publicinfrastructure improvements that benefit or serve the district,and that a project within the district places real property in usefor commercial or industrial purposes. Service payments may beused to finance or support loans, deferred loans, and grants topersons for the purpose of housing renovations within thedistrict. The resolution shalldesignate the parcels within thedistrict that are eligible forhousing renovations. Theresolution shall state separately theamount or the percentages ofthe expected aggregate servicepayments that are designated foreach public infrastructureimprovement and for the purpose ofhousing renovations.

(4) Except with theapproval of the board of education of eachcity, local, orexempted village school district within theterritory of which thedistrict is or will be located, and subject to division (D) of this section, the life ofa an incentive district shall notexceed ten years, and the percentage ofimprovements to beexempted shall not exceed seventy-five percent. With suchapproval of the board of education, the life of a district may be not morethan thirtyyears, and the percentage of improvements to beexempted may benot more than one hundred per cent.

(5) Approval of a board of education shall be obtained in themanner provided in division (C) of this section for exemptionsunder division (A) of this section, except that the notice to theboard of education shall delineate the boundaries of the district,specifically identify each parcel within the district, identifyeach anticipated improvement in the district, provide an estimateof the true value in money of each such improvement, specify thelife of the district and the percentage of improvements that wouldbe exempted, and indicate the date on which the board of countycommissioners intends to adopt the resolution.

A board of county commissioners shall not adopt a resolutionunder this division after June 30, 2007.

(C)(1) Improvementswith respect to a parcel may beexemptedfrom taxationunder division (A) of this section for uptotenyears or,with the approval of the board of education ofthecity,local, orexempted village school district within which theparcel islocated, forup to thirtyyears. The percentage of theimprovements exemptedfrom taxationmay, with such approval,exceed seventy-five percent, but shallnot exceed one hundred percent. Not later thanforty-fivebusiness days prior to adopting aresolution under thissectiondeclaring improvements to be apublic purpose that is subject to the approval of a board of education under this division,the board ofcountycommissioners shall deliver tothe board ofeducation a noticestating its intent toadopt aresolution making that declaration.Thenotice shallidentify theparcels for which improvements are to be exempted from taxation,provide an estimate ofthe true value in money oftheimprovements,specify the periodfor which the improvementswouldbe exempted from taxation and thepercentage of theimprovementsthat would beexempted, andindicate the date onwhich the boardofcountycommissionersintends to adopt theresolution.The boardofeducation, byresolution adopted by amajority of theboard,mayapprove theexemption for the periodor for theexemptionpercentage specifiedin the notice, maydisapprove theexemptionfor the number ofyears in excess often, may disapprovetheexemption for thepercentage of theimprovements to beexempted inexcess ofseventy-five per cent,or both, or mayapprove theexemption onthe condition that theboard ofcountycommissionersand theboardof education negotiate anagreementproviding forcompensation tothe school district equalin valueto a percentageof the amountof taxes exempted in theeleventhand subsequentyears of theexemption period or, in thecase ofexemptionpercentages inexcess of seventy-five per cent,compensation equalin value to apercentage of the taxes thatwould be payable on theportion ofthe improvements in excess ofseventy-five per centwere thatportion to be subject totaxation, or other mutually agreeable compensation.The board ofeducation shallcertify its resolution tothe boardofcountycommissioners notlater than fourteen days prior tothe datetheboard ofcountycommissioners intends to adopt itsresolution asindicated in thenotice. If the board of educationapproves theexemption on thecondition that a compensationagreement benegotiated, the boardof education in its resolutionshall proposea compensationpercentage. If the board ofeducation and theboard ofcountycommissioners negotiate a mutuallyacceptablecompensationagreement, the resolution of the board ofcountycommissioners maydeclare the improvements a public purpose forthe number of yearsspecified in that resolution or, in the caseof exemptionpercentages in excess of seventy-five per cent, forthe exemptionpercentage specified in the resolution. In eithercase, if theboard of education and the board ofcountycommissionersfail tonegotiate a mutually acceptable compensationagreement,theresolution may declare the improvements a publicpurpose fornotmore than ten years, but shall not exempt morethanseventy-fiveper cent of the improvements from taxation, or,inthe case of aresolution adopted under division (A) of thissection, notmorethan the estimated percentageof the incrementaldemand asotherwiseprescribed bydivision (A)of thissectionifthat percentage is lessthanseventy-fiveper cent. If the boardof education fails to certifya resolutionto the board ofcountycommissioners within the timeprescribed bythis section, theboard ofcounty commissioners thereuponmayadopt the resolutionand maydeclare the improvements a publicpurpose for up to thirtyyearsor, in the case of exemptionpercentages proposed in excessofseventy-five per cent, for theexemption percentage specifiedinthe resolution. The board ofcounty commissioners may adopttheresolution at any time afterthe board of education certifiesitsresolution approving theexemption to the board of countycommissioners, or, if the boardof education approves theexemption on the condition that amutually acceptable compensationagreement be negotiated, at anytime after the compensationagreement is agreed to by the boardofeducation and the board ofcounty commissioners.

(2) If a board of education has adopted a resolutionwaivingits right to approve exemptions from taxation and theresolutionremains in effect, approval of such exemptions by theboard ofeducation is not required under division(C)(1) ofthis section.If aboard of education has adopted a resolutionallowing a boardofcounty commissioners to deliver the noticerequired underdivision(C)(1) of this section fewerthanforty-five businessdays prior to approval of the resolutionbythe board of countycommissioners, the board ofcountycommissioners shall deliver thenotice to the board ofeducationnot later than the number of daysprior to suchapproval asprescribed by the board of education initsresolution. If aboard of education adopts a resolutionwaivingits right toapprove exemptions or shortening thenotificationperiod, theboard of education shall certify a copyof theresolution to theboard of county commissioners. If theboard ofeducation rescindssuch a resolution, it shall certifynotice ofthe rescission tothe board of county commissioners.

(D)(1) If a proposed resolution under division (B)(1) of this section exempts improvements with respect to a parcel for more than ten years, or the percentage of the improvement exempted from taxation exceeds seventy-five per cent, not later than forty-five business days prior to adopting the ordinance the board of county commissioners shall deliver to the board of township trustees of any township or legislative authority of any municipal corporation within which the incentive district is or will be located a notice that states its intent to adopt a resolution creating an incentive district. The notice shall include a copy of the proposed resolution.

(2) The board of township trustees or legislative authority of the municipal corporation, or both, by resolution, may object to the exemption for the number of years in excess of ten, may object to the exemption for the percentage of the improvement to be exempted in excess of seventy-five per cent, or both, or may accept either or both exemptions. If the board of township trustees or legislative authority, or both, objects, the board of township trustees or legislative authority may negotiate an agreement with the board of county commissioners that provides to the board of township trustees or legislative authority, or both, in the eleventh and subsequent years of the exemption period compensation equal in value to not more than fifty per cent of the taxes that would be payable to the township or municipal corporation on the portion of the improvement in excess of seventy-five per cent, were that portion to be subject to taxation. The board of township trustees and legislative authority shall certify its resolution to the board of county commissioners not later than thirty days after receipt of the notice.

(3) If the board of township trustees and the legislative authority of the municipal corporation does not object or fails to certify a resolution objecting to an exemption within thirty days after receipt of the notice, the board of county commissioners may adopt its resolution, and no compensation shall be provided to the board of township trustees or legislative authority. If both the board of township trustees or legislative authority of the municipal corporation certify resolutions objecting to the commissioners' resolution, the board of county commissioners may adopt its resolution at any time after both compensation agreements are agreed to by the board of county commissioners and the respective party to the agreement. If either the board of township trustees or legislative authority of the municipal corporation certify a resolution objecting to the commissioners' resolution, the board of county commissioners may adopt its resolution at any time after the compensation agreement is agreed to by the board of county commissioners and the board or legislative authority, or, if no compensation agreement is negotiated, at any time after the board of county commissioners agrees to provide compensation to the board of township trustees or legislative authority, or to both, of fifty per cent of the taxes that would be payable to the township or municipal corporation in the eleventh and subsequent years of the exemption period on the portion of the improvement in excess of seventy-five per cent, were that portion to be subject to taxation.

(E) Any of the following property tax levies that are enacted on or after January 1, 2006, and after the date an ordinance creating an incentive district is adopted on or after January 1, 2006, under division (C)(1) of this section shall be levied on property that was exempted from taxation under division (C) of this section and revenues collected from such levies shall not be used to provide service payments under this section:

(1) A tax levied under division (L) of section 5705.19 of the Revised Code for community mental retardation and developmental disabilities programs and services pursuant to Chapter 5126. of the Revised Code;

(2) A tax levied under division (Y) of section 5705.19 of the Revised Code for providing or maintaining senior citizens services or facilities;

(3) A tax levied under section 5705.22 of the Revised Code for county hospitals;

(4) A tax levied under section 5705.221 of the Revised Code for alcohol, drug addiction, and mental health services;

(5) A tax levied under section 5705.23 of the Revised Code for library purposes;

(6) A tax levied under section 5705.24 of the Revised Code for the support of children services and the placement and care of children.

(F) An exemptionfrom taxation granted under thissectioncommenceswith the tax year in which an improvementfirst appearson the tax list and duplicate of real and publicutility propertyand specified in the resolution that begins after the effective date of theresolution.Exceptas otherwise provided in this division,the exemption endson thedate specified in the resolution asthedate theimprovementceases to be a public purposeor theincentivedistrict expires,orends on thedateon which thecounty can nolonger requireannual servicepaymentsin lieu oftaxes undersection 5709.79 ofthe RevisedCode,whichever occursfirst. Theexemption of animprovement with respect to a parcel may end on alaterdate, asspecifiedin the resolution, if the board ofcommissionersand theboard ofeducation of the city, local, orexemptedvillage schooldistrictwithin which the parcel islocatedhave entered into acompensationagreement under section5709.82of the Revised Codewith respectto the improvementordistrictand the board ofeducation has approved theterm of theexemptionunder division(C)(1) of this section, but in no caseshall theimprovement beexempted fromtaxation formore thanthirty years.Exemptionsshall beclaimedand allowed in the sameor a similarmanner as inthecase ofother real propertyexemptions. If anexemptionstatuschangesduring a tax year, theprocedure for theapportionment ofthetaxes for that year is thesame as in thecase of otherchanges intax exemption statusduring the year.

(E)(G) If the board ofcounty commissioners is not requiredbythis section to notify the board ofeducationof the board ofcounty commissioners' intent to declareimprovements tobe apublic purpose, the board ofcountycommissioners shall complywiththe notice requirements imposedunder section 5709.83 of theRevised Code before taking formalaction to adopt the resolutionmaking that declaration, unless theboard of education has adoptedaresolutionunder that sectionwaiving its right to receive sucha notice.

(F)(H) The county, not later than fifteen days after theadoption of a resolution under thissection, shall submit to thedirector of development a copy oftheresolution. On or beforethe thirty-first day of Marchof eachyear,the county shallsubmit a status report to the director ofdevelopment. Thereportshall indicate, in the mannerprescribed by the director,theprogress of the project duringeachyear thatan exemptionremains in effect, including asummary of the receipts fromservice payments in lieu of taxes;expenditures of money fromfunds created under section 5709.75 ofthe Revised Code; adescription of the public infrastructureimprovementsand housingrenovations financed with suchexpenditures; and a quantitativesummary ofchanges in employmentand private investment resultingfrom eachproject.

(G)(I) Nothing in this section shall be construed to prohibit aboard of county commissioners from declaring to be a publicpurpose improvements with respect to more than one parcel.

Sec. 5711.01.  As used in this chapter:

(A) "Taxable property" includes all the kinds of propertymentioned in division (B) of section 5709.01 and section 5709.02of the Revised Code, and also the amount or value as of the dateof conversion of all taxable property converted into bonds orother securities not taxed on or after the first day of Novemberin the year preceding the date of listing, and of all othertaxable property converted into deposits after the date as ofwhich deposits are required to be listed in such year, except inthe usual course of the taxpayer's business, to the extent he thetaxpayer mayhold or control such bonds, securities, or deposits on such day,without deduction for indebtedness created in the purchase ofsuch bonds or securities from his the taxpayer's credits. However, taxable "Taxableproperty" does not include such investments and deposits as aretaxable at the source as provided in sections 5725.01 to 5725.26of the Revised Code, surrender values under policies ofinsurance, or any tangible personal property acquired from apublic utility or interexchange telecommunications company asdefined in section 5727.01 of the Revised Code, and leased backto the public utility or interexchange telecommunications companypursuant to a sale and leaseback transaction as defined indivision (I) of section 5727.01 of the Revised Code.

For tax year 2007 and thereafter, taxable property leased to a telephone, telegraph, or interexchange telecommunications company, as defined in section 5727.01 of the Revised Code, shall be listed and assessed by the owner of the property at the percentage of true value in money required under division (H) of section 5711.22 of the Revised Code.

(B) "Taxpayer" means any owner of taxable property,including property exempt under division (C) of section 5709.01of the Revised Code, and includes every person residing in, orincorporated or organized by or under the laws of this state, ordoing business in this state, or owning or having a beneficialinterest in taxable personal property in this state and everyfiduciary required by sections 5711.01 to 5711.36 of the RevisedCode, to make a return for or on behalf of another. For tax year 2007 and thereafter, "taxpayer" includes telephone companies, telegraph companies, and interexchange telecommunications company as defined in section 5727.01 of the Revised Code. The taxcommissioner may by rule define and designate the taxpayer, as toany taxable property which would not otherwise be required bythis section to be returned; and any such rule shall beconsidered supplementary to the enumeration of kinds of taxpayersfollowing:

(1) Individuals of full age and sound mind residing inthis state;

(2) Partnerships, corporations, associations, andjoint-stock companies, under whatever laws organized or existing,doing business or having taxable property in this state; andcorporations incorporated by or organized under the laws of thisstate, wherever their actual business is conducted;

(3) Fiduciaries appointed by any court in this state orhaving title, possession, or custody of taxable personal propertyin this state or engaged in business in this state;

(4) Unincorporated mutual funds.

Taxpayer excludes all individuals, partnerships,corporations, associations, and joint-stock companies, theirexecutors, administrators, and receivers who are defined in TitleLVII of the Revised Code as financial institutions, dealers inintangibles, domestic insurance companies, or public utilities,except to the extent they may be required by sections 5711.01 to5711.36 of the Revised Code, to make returns as fiduciaries, orby section 5725.26 of the Revised Code, to make returns ofproperty leased, or held for the purpose of leasing, to others ifthe owner or lessor of the property acquired it for the solepurpose of leasing it to others or to the extent that property istaxable under section 5725.25 of the Revised Code.

(C) "Return" means the taxpayer's annual report of taxableproperty.

(D) "List" means the designation, in a return, of thedescription of taxable property, the valuation or amount thereof,the name of the owner, and the taxing district where assessable.

(E) "Taxing district" means, in the case of propertyassessable on the classified tax list and duplicate, a municipalcorporation or the territory in a county outside the limits ofall municipal corporations therein; in the case of propertyassessable on the general tax list and duplicate, a municipalcorporation or township, or part thereof, in which the aggregaterate of taxation is uniform.

(F) "Assessor" includes the tax commissioner and thecounty auditor as deputy of the commissioner.

(G) "Fiduciary" includes executors, administrators,parents, guardians, receivers, assignees, official custodians,factors, bailees, lessees, agents, attorneys, and employees, butdoes not include trustees unless the sense so requires.

(H) "General tax list and duplicate" means the books orrecords containing the assessments of property subject to localtax levies.

(I) "Classified tax list and duplicate" means the books orrecords containing the assessments of property not subject tolocal tax levies.

(J) "Investment company" means any corporation, the sharesof which are regularly offered for sale to the public, engagedsolely in the business of investing and reinvesting funds in realproperty or investments, or holding or selling real property orinvestments for the purpose of realizing income or profit whichis distributed to its shareholders. Investment company does notinclude any dealer in intangibles, as defined in section 5725.01of the Revised Code.

(K) "Unincorporated mutual fund" means any partnership,each partner of which is a corporation, engaged solely in thebusiness of investing and reinvesting funds in investments, orholding or selling investments for the purpose of realizingincome or profit which is distributed to its partners and whichis subject to Chapter 1707. of the Revised Code. Anunincorporated mutual fund does not include any dealer inintangibles as defined in section 5725.01 of the Revised Code.

Sec. 5711.16.  (A) As used in this section,manufacturer:

(1) "Manufacturer" means a person who purchases, receives, or holdspersonalproperty for the purpose of adding to its value by manufacturing, refining,rectifying, or combining different materials with a view of making a gain orprofit by so doing.

(2) "Manufacturing equipment" means machinery and equipment, and tools and implements, including any associated patterns, jigs, dies, drawings, and business fixtures, used at a manufacturing facility by a manufacturer, and includes any such property leased to the manufacturer. "Manufacturing equipment" excludes property used for general office purposes. Nothing in this division is to be construed to change the definition of personal property, as defined in section 5701.03 of the Revised Code.

(3) "Manufacturing facility" means a facility or portion of a facility used for manufacturing, mining, refining, rectifying, or combining different materials with a view of making a gain or profit by so doing. "Manufacturing facility" includes that portion of a facility used to store or transport raw materials, work-in-process, or finished goods inventory, for packaging, for research, or to test for quality control, as long as manufacturing, mining, refining, rectifying, or combining is also performed at the facility. "Manufacturing facility" does not include any portion of a facility used primarily for making retail sales.

(4) "Manufacturing inventory" means all articles purchased, received, or otherwise held for the purpose of being used, in whole or in part, in manufacturing, mining, combining, rectifying, or refining, and of all articles that were at any time manufactured or changed in any way by a manufacturer, either by mining, combining, rectifying, refining, or adding thereto.

(B) When a manufacturer is required to return a statement ofthe amount of the manufacturer's personal property used inbusiness, the manufacturer shall include theaverage value, estimated as provided in this section, of all articlespurchased, received, or otherwise held for the purpose of being used, in wholeor in part, in manufacturing, combining, rectifying, or refining, and of allarticles that were at any time manufacturedor changed in any way by the manufacturer,either by combining, rectifying, refining, or adding thereto, manufacturing inventorythat the manufacturer has had on hand during the year ending on the day theproperty is listed for taxation annually, or the part of such year duringwhich the manufacturer was engaged in business. The manufacturershall separately list finished products not kept or stored at the place ofmanufacture or at a warehouse in the same county.

The average value of such property shall be ascertained by taking the value ofall property subject to be listed on the average basis, owned by themanufacturer on the last business day of each month the manufacturer wasengaged in business during the year, adding the monthly values together, anddividing the result by the number of months the manufacturer was engaged insuch business during the year. The result shall be the average value to belisted.

(B)(C) A manufacturer also shall list all engines and machinery, and toolsand implements, of every kind used, or designed to be used, in refining andmanufacturing, and equipment owned or used by the manufacturer.

Sec. 5711.21.  (A) In assessing taxable property theassessor shall be governed by the rules of assessment prescribedby sections 5711.01 to 5711.36 of the Revised Code. Wherever anytaxable property is required to be assessed at its true value inmoney or at any percentage of true value, the assessor shall beguided by the statements contained in the taxpayer's return andsuch other rules and evidence as will enable the assessor toarrive at such true value. Wherever the income yield of taxableproperty is required to be assessed, and the method ofdetermining between income and return or distribution ofprincipal, or that of allocating expenses in determining netincome, or that of ascertaining the source from which partialdistributions of income have been made is not expresslyprescribed by sections 5711.01 to 5711.36 of the Revised Code,the assessor shall be guided by the statements contained in thetaxpayer's return and such general rules as the tax commissioneradopts to enable the assessor to make such determination.

(B) The For tax years before tax year 2009, the true value of the boilers, machinery, equipment,and any personal property used to generate or distribute theelectricity shall be the sum of the following:

(1) The true value of the property as it would bedetermined under this chapter if none of the electricity weredistributed to others multiplied by the per cent of theelectricity generated in the preceding calendar year that wasused by the person who generated it; plus

(2) The true value of the property that is productionequipment as it would be determined for an electric company undersection 5727.11 of the Revised Code multiplied by the per cent ofthe electricity generated in the preceding calendar year that wasnot used by the person who generated it; plus

(3) The true value of the property that is not productionequipment as it would be determined for an electric company undersection 5727.11 of the Revised Code multiplied by the per cent ofthe electricity generated in the preceding calendar year that wasnot used by the person who generated it.

(C) The For tax years before tax year 2009, the true value of personal property leased to a publicutility or interexchange telecommunications company as defined insection 5727.01 of the Revised Code and used by the utility orinterexchange telecommunications company directly in therendition of a public utility service as defined in division (P)of section 5739.01 of the Revised Code shall be determined in thesame manner that the true value of such property is determinedunder section 5727.11 of the Revised Code if owned by the publicutility or interexchange telecommunications company.

Sec. 5711.22.  (A) Deposits not taxed at the source shallbe listed and assessed at their amount in dollars on the day theyare required to be listed. Moneys shall be listed and assessedat the amount thereof in dollars on hand on the day that they arerequired to be listed. In listing investments, the amount of theincome yield of each for the calendar year next preceding thedate of listing shall, except as otherwise provided in thischapter, be stated in dollars and cents and the assessmentthereof shall be at the amount of such income yield; but anyproperty defined as investments in either division (A) or (B) ofsection 5701.06 of the Revised Code that has not beenoutstanding for the full calendar year next preceding the date oflisting, except shares of stock of like kind as other shares ofthe same corporation outstanding for the full calendar year nextpreceding the date of listing, or which has yielded no incomeduring such calendar year shall be listed and assessed asunproductive investments, at their true value in money on the daythat such investments are required to be listed.

Credits and other taxable intangibles shall be listed andassessed at their true value in money on the day as of which thesame are required to be listed.

Shares of stock of a bank holding company, as defined inTitle 12 U.S.C.A., section 1841, that are required to belistedfor taxation under this division and upon which dividends werepaid during the year of their issuance, which dividends aresubject to taxation under the provisions of Chapter 5747. of theRevised Code, shall be exempt from the intangibles tax for theyear immediately succeeding their issuance. If suchshares beardividends the first calendar year after their issuance, whichdividends are subject to taxation under the provisions of Chapter5747. of the Revised Code, it shall be deemed that the nondelinquentintangible property tax pursuant to division (A) of section5707.04 of the Revised Code was paid on those dividends paid thatfirst calendar year after the issuance of the shares.

(B)(1) Boilers For tax years before tax year 2009, boilers, machinery, equipment, and personalproperty the true value of which is determined under division (B)of section 5711.21 of the Revised Code shall be listed andassessed at an amount equal to the sum of the products determinedunder divisions (B)(1)(a), (b)(2), and (c)(3) of this section.:

(a)(1) Multiply the portion of the true value determinedunder division (B)(1) of section 5711.21 of the Revised Code bythe assessment rate for the tax year in division(F)(G) of this section;

(b)(2) Multiply the portion of the true value determinedunder division (B)(2) of section 5711.21 of the Revised Code bythe assessment rate in section 5727.111 of the Revised Code thatis applicable to the production equipment of an electric company;

(c)(3) Multiply the portion of the true value determinedunder division (B)(3) of section 5711.21 of the Revised Code bythe assessment rate in section 5727.111 of the Revised Code thatis applicable to the property of an electric company that is notproduction equipment.

(2) Personal (C) For tax years before tax year 2009, personal property leased to a public utility orinterexchange telecommunications company as defined in section5727.01 of the Revised Code and used directly in the rendition ofa public utility service as defined in division (P) of section5739.01 of the Revised Code shall be listed and assessed at thesame percentage of true value in money that such property isrequired to be assessed by section 5727.111 of the Revised Codeif owned by the public utility or interexchangetelecommunications company.

(C)(D)(1) Merchandise or an agricultural product shipped from outside this stateand held in this state in a warehouse or a place ofstorage without further manufacturing or processing and for storageonly and for shipment outside thisstate, but that is taxable because it does not qualify as "not used inbusiness in this state" under division (B)(1) or (2) of section 5701.08of the RevisedCode, shall be listed and assessed at a rate of twenty-five one-hundredths ofits true value in money until reduced in accordance with the followingschedule:

(a) For any year, subtract five one-hundredths from the rate at which suchproperty was required to be listed and assessed in the preceding year, if thetotal statewide collection of all real and tangible personal property taxesforthe second preceding year exceeded the total statewide collection of all realand tangible personal property taxes for the third preceding year by more thanthe greater of four per cent or the rate of increase from the third to thesecond preceding years in the average consumer price index (all urbanconsumers, all items) prepared by the bureau of labor statistics of the UnitedStates department of labor;

(b) If no reduction in the assessment rate is made for a year, the rate isthe same as for the preceding year.

(2) Each year until the year the assessment rate equals zero, the taxcommissioner shall determine the assessment rate required under this divisionand shall notify all county auditors of that rate.

(3) Notwithstanding provisions to the contrary in division (B) of section5701.08 of the Revised Code, during and after the year for which theassessment rate as calculated under this division equals zero, any merchandiseor agricultural product shipped from outside this state and held in this statein any warehouse or place of storage, whether public or private, withoutfurther manufacturing or processing and for storage only and for shipmentoutside this state to any person for any purpose is nevertheless not usedin business inthis state for property tax purposes.

(D)(1)(2) Merchandise or an agricultural product owned by aqualified out-of-state person shipped from outside this stateand held in this state in a public warehouse without furthermanufacturing or processing and for temporary storage only andfor shipment inside this state, but that is taxable because itdoes not qualify as "not used in business in this state" underdivision (B)(1) or (2) ofsection 5701.08 of the RevisedCode, shall be listed andassessed at a rate of twenty-five one-hundredths of its truevalue in money until reduced in accordance with the followingschedule:

(a) For any year, subtract five one-hundredthsfrom the rate at which such property was required to be listedand assessed in the preceding year, if the total statewidecollection of all real and tangible personal property taxes forthe second preceding year exceeded the total statewidecollection of all real and tangible personal property taxes forthe third preceding year by more than the greater of four percent or the rate of increase from the third to the secondpreceding years in the average consumer price index (all urbanconsumers, all items) prepared by the bureau of labor statisticsof the UnitedStates department oflabor;

(b) If no reduction in the assessment rate is madefor a year, the rate is the same as for the precedingyear.

(2) Each year until the year the assessment rate equalszero, the tax commissioner shall determine the assessment raterequired under this division and shall notify all countyauditors of that rate.

(3) Notwithstanding provisions to the contrary indivision (B) of section 5701.08of the RevisedCode, during and after the yearfor which the assessment rate as calculated under this divisionequals zero, any merchandise or agricultural product describedin division (D)(1) of thissection is nevertheless not used in business in this state for property taxpurposes.

(4)(3) As used in division(D)(2) of this section:

(a) "Qualified out-of-state person" means a personthat does not own, lease, or use property, other thanmerchandise or an agricultural product described in thisdivision, in this state, and does not have employees, agents, orrepresentatives in this state;

(b) "Public warehouse" means a warehouse in thisstate that is not subject to the control of or under thesupervision of the owner of the merchandise or agriculturalproduct stored in it, or staffed by the owner's employees, andfrom which the property is to be shipped inside thisstate.

(E) Personal property valued pursuant to section 5711.15of the Revised Code and personal propertyrequired to be listed on the average basis by division(A) (B) of section 5711.16 of the RevisedCode, except property described in division(C) or (D) of this section, businessfixtures, and furniture not held for sale in the course ofbusiness, shall be listed and assessed at the rate of twenty-five per cent ofits true value in money untilreduced to zero in accordance with the following schedule:

(1) Beginning in tax year 2002 and for each of tax years 2003 and2004, subtract one percentage point from the rate atwhich the property was required to be listed and assessed in thepreceding year, if the total statewide collection of tangiblepersonal property taxes for the second preceding year exceeded thetotal statewide collection of tangible personal property taxes forthe third preceding year. If no reduction in the assessment rateis made for a year, the rate is the same as for the precedingyear.

(2) In tax years 2005 and 2006, the assessment rateshall be reduced by two percentage points, if the total statewide collection of tangible personal property taxes for the second preceding year exceeded the total statewide collection of tangible personal property taxes for the third preceding year. If no reduction in the assessment rate is made for a year, the rate is the same as for the preceding year.

(3) For tax year 2007 and each tax year thereafter, the assessment rate shall be reduced by two percentage points. During and after the tax yearthat the assessment rate equals zero, the property described indivision (E) of this section shall not be listed for taxation.

Each year until the year the assessment rate equals zero, the taxcommissioner shall determine the assessment rate required under thisdivision and shall notify all county auditors of that rate.

For purposes of division (E) of this section, "total statewide collection of tangible person property taxes" excludes taxes collected from public utilities and interexchange telecommunications companies on property that is determined to be taxable pursuant to section 5727.06 of the Revised Code twenty-three per cent of its true value in money for tax year 2005 and at the percentage of such true value specified in division (G) of this section for tax year 2006 and each tax year thereafter.

(F) All manufacturing equipment as defined in section 5711.16 of the Revised Code shall be listed and assessed at the following percentage of its true value in money:

(1) For all such property not previously used in business in this state by the owner thereof, or by related member or predecessor of the owner, other than as inventory, before January 1, 2005, zero per cent of true value;

(2) For all other such property, at the percentage of true value specified in division (G) of this section for tax year 2005 and each tax year thereafter.

(F)(G) Unless otherwise provided by law, all other personalproperty used in business that has not been legally regarded asan improvement on land and considered in arriving at the value ofthe real property assessed for taxation shall be listed andassessed at the rate of twenty-five per cent following percentages of its true value in money:

(1) For tax year 2005, twenty-five per cent of true value;

(2) For tax year 2006, eighteen and three-fourths per cent of true value;

(3) For tax year 2007, twelve and one-half per cent of true value;

(4) For tax year 2008, six and one-fourth per cent of true value;

(5) For tax year 2009 and each tax year thereafter, zero per cent of true value.

(H)(1) For tax year 2007 and thereafter, all personal property used by a telephone company, telegraph company, or interexchange telecommunications company shall be listed as provided in this chapter and assessed at the following percentages of true value in money:

(a) For tax year 2007, twenty per cent of true value;

(b) For tax year 2008, fifteen per cent of true value;

(c) For tax year 2009, ten per cent of true value;

(d) For tax year 2010, five per cent of true value;

(e) For tax year 2011 and each tax year thereafter, zero per cent of true value.

(2) The property owned by a telephone, telegraph, or telecommunications company shall be apportioned to each appropriate taxing district as provided in section 5727.15 of the Revised Code.

(I) During and after the tax year in which the assessment rate equals zero per cent, the property described in division (E), (F), (G), or (H) of this section shall not be listed for taxation.

(J) Divisions (E), (F), (G), and (H) of this section apply to the property of a person described in divisions (E)(3) to (10) of section 5751.01 of the Revised Code. Division (J) of this section does not prevent the application of the exemption of property from taxation under section 5725.25 or 5725.26 of the Revised Code.

Sec. 5711.28.  Whenever the assessor imposes a penaltyprescribed by section 5711.27 or 5725.17 of the Revised Code, theassessor shall sendnotice of such penalty assessment to the taxpayer by mail. Ifthe notice also reflects the assessment of any property notlisted in or omitted from a return, or the assessment of any itemor class of taxable property listed in a return by the taxpayerin excess of the value or amount thereof as so listed, or withoutallowing a claim duly made for deduction from the net book valueof accounts receivable, or depreciated book value of personalproperty used in business, so listed, and the taxpayer objects toone or more of such corrections in addition to the penalty, thetaxpayershall proceed as prescribed by section 5711.31 of the RevisedCode, but if no such correction is reflected in the notice, or ifthe taxpayer does not object to any such correction made, hethe taxpayer shall proceed as prescribed herein.

Within sixty days after the mailing of the notice of apenalty assessment prescribed by this section, the taxpayer mayfile with the tax commissioner, in person or by certified mail, apetition for abatement of such penalty assessment. If thepetition is filed by certified mail, the date of the UnitedStates postmark placed on the sender's receipt by the postalemployee to whom the petition is presented shall be treated asthe date of filing. The petition shall have attached thereto andincorporated therein by reference a true copy of the notice ofassessment complained of, but the failure to attach a copy ofsuch notice and incorporate it by reference does not invalidatethe petition. The petition shall also indicate that thetaxpayer's only objection is to the assessed penalty and thereason for such objection.

Upon the filing of a petition for abatement of penalty, thecommissioner shall notify the treasurer of state or the auditorand treasurer of each county having any part of the penaltyassessment entered on the tax list or duplicate. Thecommissioner shall review the petition without the need forhearing. If it appears that the failure of the taxpayer totimely return or list as required under this chapter, or to file a complying report and pay tax under Chapter 5725. of the Revised Code, whichever the case may be, was due to reasonable cause and not willfulneglect, the commissioner may abate in whole or in part thepenalty assessment. The commissioner shall transmit acertificate of the commissioner's determination to thetaxpayer, and if noappeal is taken therefrom as provided by law, or upon the finaldetermination of an appeal which may be taken, thecommissioner shall notifythe treasurer of state or the proper county auditor of such finaldetermination. If the final determination orders abatement ofthe penalty assessment, the notification may be in the form of anamended assessment certificate. Upon receipt of thenotification, the treasurer of state or county auditor shall makeany corrections to the treasurer's or auditor's records andtax lists and duplicatesrequired in accordance therewith and proceed as prescribed bysection 5711.32 or 5725.22 of the Revised Code.

The decision of the commissioner shall be final withrespect to the percentage of penalty, if any, thecommissionerfindsappropriate for the failure to return timely or list theproperty, but neither the commissioner's decision nor afinal judgment of theboard of tax appeals or any court to which such finaldetermination may be appealed shall finalize the assessment ofsuch property.

Sec. 5713.01.  (A) Each county shall be the unit forassessing real estate for taxation purposes. The county auditorshall be the assessor of all the real estate in his theauditor's county forpurposes of taxation, but this section does not affect the powerconferred by Chapter 5727. of the Revised Code upon the taxcommissioner regarding the valuation and assessment of the realproperty of railroads used in railroad operations.

(B) The auditor shall assess all the real estate situatedin the county at its taxable value in accordance with sections5713.03, 5713.31, and 5715.01 of the Revised Code and with therules and methods applicable to his the auditor's countyadopted, prescribed,and promulgated by the tax commissioner. The auditor shall viewand appraise or cause to be viewed and appraised at its truevalue in money, each lot or parcel of real estate, including landdevoted exclusively to agricultural use, and the improvementslocated thereon at least once in each six-year period and thetaxable values required to be derived therefrom shall be placedon the auditor's tax list and the county treasurer's duplicatefor the tax year ordered by the commissioner pursuant to section5715.34 of the Revised Code. The commissioner may grant anextension of one year or less if he the commissioner finds thatgood cause existsfor the extension. When the auditor so views and appraises, he theauditormay enter each structure located thereon to determine by actualview what improvements have been made therein or additions madethereto since the next preceding valuation. The auditor shallrevalue and assess at any time all or any part of the real estatein such county, including land devoted exclusively toagricultural use, where he the auditor finds that the true ortaxable valuesthereof have changed, and when a conservation easement is createdunder sections 5301.67 to 5301.70 of the Revised Code. He Theauditor mayincrease or decrease the true or taxable value of any lot orparcel of real estate in any township, municipal corporation, orother taxing district by an amount which will cause all realproperty on the tax list to be valued as required by law, or he theauditor may increase or decrease the aggregate value of all realproperty, or any class of real property, in the county, township,municipal corporation, or other taxing district, or in any wardor other division of a municipal corporation by a per cent oramount which will cause all property to be properly valued andassessed for taxation in accordance with Section 36, Article II,Section 2, Article XII, Ohio Constitution, this section, andsections 5713.03, 5713.31, and 5715.01 of the Revised Code.

(C) When the auditor determines to reappraise all the realestate in the county or any class thereof, when the taxcommissioner orders an increase in the aggregate true or taxablevalue of the real estate in any taxing subdivision, or when thetaxable value of real estate is increased by the application of auniform taxable value per cent of true value pursuant to theorder of the commissioner, he the auditor shall advertise thecompletion of his the reappraisal or equalization action in anewspaper of generalcirculation in the county once a week for the three consecutiveweeks next preceding the issuance of the tax bills. When theauditor changes the true or taxable value of any individualparcels of real estate, he the auditor shall notify the owner ofthe realestate, or the person in whose name the same stands charged onthe duplicate, by mail or in person, of the changes he theauditor has madein the assessments of such property. Such notice shall be givenat least thirty days prior to the issuance of the tax bills.Failure to receive notice shall not invalidate any proceedingunder this section.

(D) The auditor shall make the necessary abstracts frombooks of his the auditor's office containing descriptions ofreal estate insuch county, together with such platbooks and lists of transfersof title to land as the auditor deems necessary in theperformance of his the auditor's duties in valuing such propertyfor taxation.Such abstracts, platbooks, and lists shall be in such form anddetail as the tax commissioner prescribes.

(E) The auditor, with the approval of the taxcommissioner, may appoint and employ such experts, deputies,clerks, or other employees as he the auditor deems necessary totheperformance of his the auditor's duties as assessor, or, withthe approval ofthe tax commissioner, he the auditor may enter into a contractwith anindividual, partnership, firm, company, or corporation to do allor any part of the work; the amount to be expended in the paymentof the compensation of such employees shall be fixed by the boardof county commissioners. If, in the opinion of the auditor, theboard of county commissioners fails to provide a sufficientamount for the compensation of such employees, he the auditormay apply tothe tax commissioner for an additional allowance, and theadditional amount of compensation allowed by the commissionershall be certified to the board of county commissioners, and thesame shall be final. The salaries and compensation of suchexperts, deputies, clerks, and employees shall be paid upon thewarrant of the auditor out of the general fund or the real estateassessment fund of the county, or both. If the salaries andcompensation are in whole or in part fixed by the commissioner,they shall constitute a charge against the county regardless ofthe amount of money in the county treasury levied or appropriatedfor such purposes.

(F) Any contract for goods or services related to theauditor's duties as assessor, including contracts for mapping,computers, and reproduction on any medium of any documents,records, photographs, microfiche, or magnetic tapes, but notincluding contracts for the professional services of anappraiser, shall be awarded pursuant to the competitive biddingprocedures set forth in sections 307.86 to 307.92 of the RevisedCode and shall be paid for, upon the warrant of the auditor, fromthe real estate assessment fund.

(G) Experts, deputies, clerks, and other employees, inaddition to their other duties, shall perform such services asthe auditor directs in ascertaining such facts, description,location, character, dimensions of buildings and improvements,and other circumstances reflecting upon the value of real estateas will aid the auditor in fixing its true and taxable value and,in the case of land valued in accordance with section 5713.31 ofthe Revised Code, its current agricultural use value. Theauditor may also summon and examine any person under oath inrespect to any matter pertaining to the value of any realproperty within the county.

Sec. 5715.01.  (A) The tax commissioner shall direct andsupervise the assessment for taxation of all real property. Thecommissioner shall adopt, prescribe, and promulgate rules for thedetermination of true value and taxable value of real property byuniform rule for such values and for the determination of thecurrent agricultural use value of land devoted exclusively toagricultural use. The uniform rules shall prescribe methods ofdetermining the true value and taxable value of real propertyand shall also prescribe the method for determining the currentagricultural use value of land devoted exclusively toagricultural use, which method shall reflect standard and modernappraisal techniques, that take into consideration: theproductivity of the soil under normal management practices; theaverage price patterns of the crops and products produced todetermine the income potential to be capitalized; the market value ofthe land for agricultural use; and other pertinent factors. Therules shall provide that in determining the true value of landsor improvements thereon for tax purposes, all facts andcircumstances relating to the value of the property, itsavailability for the purposes for which it is constructed orbeing used, its obsolete character, if any, the income capacityof the property, if any, and any other factor that tends to proveits true value shall be used. The In determining the true value of minerals or rights to minerals for the purpose of real property taxation, the tax commissioner shall not include in the value of the minerals or rights to minerals the value of any tangible personal property used in the recovery of those minerals.

(B) The taxable value shall be thatper cent of true value in money, or current agricultural usevalue in the case of land valued in accordance with section5713.31 of the Revised Code, the commissioner by ruleestablishes, but it shall not exceed thirty-five per cent. Theuniform rules shall also prescribe methods of making theappraisals set forth in section 5713.03 of the Revised Code. Thetaxable value of each tract, lot, or parcel of real property andimprovements thereon, determined in accordance with the uniformrules and methods prescribed thereby, shall be the taxable valueof the tract, lot, or parcel for all purposes of sections 5713.01to 5713.26, 5715.01 to 5715.51, and 5717.01 to 5717.06 of theRevised Code. County auditors shall, under the direction andsupervision of the commissioner, be the chief assessing officersof their respective counties, and shall list and value the realproperty within their respective counties for taxation inaccordance with this section and sections 5713.03 and 5713.31 ofthe Revised Code and with such rules of the commissioner. Thereshall also be a board in each county, known as the county boardof revision, which shall hear complaints and revise assessmentsof real property for taxation.

(C) The commissioner shall neither adopt nor enforce any rulethat requires true value for any tax year to be any value otherthan the true value in money on the tax lien date of such taxyear or that requires taxable value to be obtained in any wayother than by reducing the true value, or in the case of landvalued in accordance with section 5713.31 of the Revised Code,its current agricultural use value, by a specified, uniformpercentage.

Sec. 5715.24.  (A) The tax commissioner, annually, shalldetermine whether the real property and the various classesthereof in the several counties, municipal corporations, andtaxing districts which have completed a sexennial reappraisal inthe current year and which will have the new taxable valuesplaced on the tax list and duplicate have been assessed asrequired by law, and whether the values set forth in theagricultural land tax list in such taxing districts correctlyreflect the true and agricultural use values of the landscontained therein. The determination shall be made prior to thefirst Monday in August unless the commissioner, for good cause,extends the date. If the commissioner finds that the realproperty or any class thereof in any such county, municipalcorporation, or taxing district, as reported to it by the severalcounty auditors of the counties that have completed suchreappraisal is not listed for taxation or recorded on theagricultural land tax list in accordance therewith, he thecommissioner shall increase or decrease the appropriate aggregate value ofthe real property or any class thereof in any such county, township,municipal corporation, taxing district, or ward or division of amunicipal corporation, by a per cent or amount that will causesuch property to be correctly valued on the agricultural land taxlist and to be correctly assessed on the tax list at its taxablevalue so that every class of real property shall be listed andvalued for taxation and valued for purposes of sections 5713.33to 5713.35 of the Revised Code as required by law. In determining whether a class of real property has been assessed at its correct taxable value and in determining any per cent or amount by which the aggregate value of the class from a prior year shall be increased or decreased to be correctly assessed, the commissioner shall consider only the aggregate values of property that existed in the prior year and that is to be taxed in the current year. In addition to any other adjustments the commissioner considers necessary to comply with this requirement, the value of new construction shall not be regarded as an increase in such aggregate value from the prior year, and the value of property destroyed or demolished since the prior year shall be deducted from the aggregate value of that class for the prior year.

In implementing any increase or decrease in valuation ofreal property ordered by the commissioner pursuant to thissection, the county auditor shall, when practicable, increase ordecrease the taxable valuation of parcels in accordance withactual changes in valuation of real property which occur indifferent subdivisions, neighborhoods, or among classes of realproperty in the county.

(B) Division (A) of this section also applies to a countyin the third calendar year following the year in which asexennial reappraisal is completed.

Sec. 5719.041.  If the payment of a general personalproperty or classified property tax is not made on or before thelast day prescribed by section 5719.03 or 5719.031 of the RevisedCode, an interest charge shall begin to accrue and shall continueuntil all charges are paid, except that no interest charge shallaccrue for or in the month in which such payment was due undersuch section or under the circumstances and for the perioddescribed in division (A)(2) of section 5711.33 of the RevisedCode or upon delinquent taxes that are the subject of a delinquent taxcontract entered into pursuant to section 5719.05 of the RevisedCode.

The interest charge shall accrue against the balance ofsuch taxes and any penalty thereon outstanding that remainsunpaid on the last day of each month and shall be at the rate percalendar month, rounded to the nearest one-hundredth of one percent, equal to one-twelfth of the rate per annum prescribed by federal short-term rate determined by the tax commissioner undersection 5703.47 of the Revised Code for the calendar year thatincludes the month for which the charge accrues. The charge ispayable in addition to the unpaid balance of taxes and penaltieson the day the charge accrues, unless the entire balance issooner paid.

If a delinquent tax contract becomes void, interest shall be charged on theday on which the contract becomes void in the amount that would have beencharged had the delinquent tax contract not been entered into and shallthereafter accrue as provided in this section.

Interest shall be allowed, at the same rate per calendarmonth as is applicable that month for underpayments, on anyoverpayment of the tax charged on a general personal property ora classified property tax duplicate, from the first day of themonth following the date of the overpayment until the last day ofthe month preceding the date of the refund of the overpayment.The interest shall be paid from the fund or funds to which theoverpayment was credited.

When the county treasurer makes the treasurer's annualsettlement withthe county auditor under division (D) of section 321.24 of theRevised Code, the treasurer shall certify to the auditor alist of allentries on the cumulative delinquent tax duplicate that are atthat time in the process of being paid in installments under avalid delinquent tax contract. For each entry thatappears on the duplicatethat is not on the certified list, the auditor shall compute thefull amount of interest charges which have accrued against suchentry since the preceding such settlement was made and shallinclude such charges through the last day of the month precedingthe current settlement. The auditor shall include such amountson the tax list and duplicates prepared by the auditor asprescribed insection 5719.04 of the Revised Code unless the interest is lessthan one dollar, in which case it shall not be added to such taxlists and duplicates.

Before the county treasurer accepts any payment of taxesagainst which there are accrued interest charges that do notappear on the delinquent tax duplicate, the treasurer shallnotify theauditor who shall issue a certificate to the treasurer showingthe amount of such interest charges, and the treasurer shallcollect the amount shown on such certificate at the time of acceptingpayment of such taxes. If the amount ofsuchinterest charges is less than one dollar, no such certificateshall be issued. In the case of delinquent personal propertytaxes, the interest shown on such certificate shall be creditedto the undivided general tax fund, and distributed in the samemanner as the delinquent taxes upon which the interest chargesaccrued. In the case of delinquent classified property taxes,the interest shown on such certificate shall be credited to thecounty library and local government support fund and distributedin accordance with section 5747.48 of the Revised Code. When thepayment of delinquent taxes is credited on the tax duplicate thetreasurer shall make a separate notation thereon indicating theamount collected and the index number of the auditor'scertificate herein prescribed.

Sec. 5725.01.  As used in sections 5725.01 to 5725.26 ofthe Revised Code:

(A) "Financial institution" means:

(1) A national bank organized and existing as a national bank associationpursuant to the "National Bank Act," 12 U.S.C. 21;

(2) A federal savings association or federal savings bank that is charteredunder 12 U.S.C. 1464;

(3) A bank, banking association, trust company, savings and loan association,savings bank, or other banking institution that is incorporated or organizedunder the laws of any state;

(4) Any corporation organized under 12 U.S.C. 611 to 631;

(5) Any agency or branch of a foreign depository as defined in 12 U.S.C. 3101;

(6) A company licensed as a small business investment company under the"SmallBusiness Investment Act of 1958," 72 Stat. 689, 15 U.S.C. 66l, as amended; or

(7) A company chartered under the "Farm Credit Act of 1933," 48 Stat. 257, 12U.S.C. 1131(d), as amended.

Corporations or institutions organized under the "Federal Farm Loan Act" andamendments thereto, insurance companies, and credit unions shall not beconsidered financial institutions or dealers in intangibles within the meaningof such sections.

(B)(1) "Dealer in intangibles" includes every person whokeeps an office or other place of business in this state andengages at such office or other place in the a business that consists primarily of lendingmoney, or discounting, buying, or selling bills of exchange,drafts, acceptances, notes, mortgages, or other evidences ofindebtedness, or of buying or selling bonds, stocks, or otherinvestment securities, whether on the person's own accountwith a view toprofit, or as agent or broker for others, with a view to profitor personal earnings. Dealer in intangibles excludesinstitutions used exclusively for charitable purposes, insurancecompanies, and financial institutions. Neither casual norisolated transactions of any of the kinds enumerated in thisdivision of this section, nor the The investment of funds as personalaccumulations or as business reserves or working capital does notconstitute engaging in a business within the meaning of thisdivision of this section; but a person who, having engaged in the abusiness that consists primarily of lending money, or discounting, buying, or sellingbills of exchange, drafts, acceptances, notes, mortgages, orother evidences of indebtedness on the person's own account,remains inbusiness primarily for the purpose of realizing upon the assets of such thebusiness is deemed a dealer in intangibles, though not presentlyengaged in a business that consists primarily of lending money or discounting or buying suchsecurities.

(2) The tax commissioner shall adopt a rule defining "primarily" as that term is used in division (B)(1) of this section.

(C) "Insurance company" includes every corporation,association, and society engaged in the business of insurance ofany character, or engaged in the business of entering intocontracts substantially amounting to insurance of any character,or of indemnifying or guaranteeing against loss or damage, oracting as surety on bonds or undertakings. "Insurance company" alsoincludes any health insuring corporation as defined in section 1751.01 of theRevised Code.

(D) "Domestic insurance company" includes every insurancecompany organized and existing under the laws of this state, andevery unincorporated association and society formed under thelaws of this state for the purpose of engaging in said business,except a company, association, or society that is an insuranceholding company affiliate controlled by a nonresident affiliateand has risks in this state formerly written by its foreignaffiliates in a total amount exceeding the risks outstanding onthe taxpayer's latest annual report that arise from businessinitially written by it in this state; and excludes every foreigninsurance company. As used in this division, terms defined insection 3901.32 of the Revised Code have the same meanings givento them in that section.

(E) "Foreign insurance company" includes every insurancecompany organized or existing under the laws of any other state,territory, country, or the United States and every insuranceholding company affiliate excepted under division (D) of thissection.

Sec. 5725.19. (A) As used in this section, "tax otherwise due" means the tax imposed on a domestic insurance company under section 5725.18 of the Revised Code reduced by the total amount of all other nonrefundable credits, if any, that the domestic insurance company is entitled to claim.

(B) Upon the issuance of a tax credit certificateby the Ohioventurecapital authority under section 150.07 of theRevised Code, a creditmay beclaimed against thetax imposed on a domestic insurancecompanyunder section 5725.18of the Revised Code. The creditshall beclaimed in the calendaryear specified in the certificateissuedby the authority.

(C) If the company elected a refundable credit under section 150.07 of the Revised Code and if the amount of the credit shown on the certificate does not exceed the tax otherwise due, then for the calendar year the company shall claim a refundable credit equal to the amount of the credit shown on the certificate.

(D) If the company elected a refundable credit under section 150.07 of the Revised Code, and the amount of the credit shown on the certificate exceeds the tax otherwise due under section 5725.18 of the Revised Code, then for the calendar year the company may receive a refund equal to seventy-five per cent of such excess. If shall claim a refundable credit equal to the sum of the following:

(1) The amount, if any, of the tax otherwise due;

(2) Seventy-five per cent of the difference between the amount of the refundable credit shown on the certificate and the tax otherwise due.

(E) If the company elected a nonrefundable credit, the amount of the credit shown on the certificate shall not exceed the amount of tax otherwise due. If the company elected a nonrefundable credit and the credit to which the company would otherwise be entitled under this section for any calendar year is greater than the tax otherwise due under section 5725.18 of the Revised Code, the excess shall be allowed as a nonrefundable credit in each of the ensuing ten calendar years, but the amount of any excess credit allowed in the ensuing calendar year shall be deducted from the balance carried forward to the next calendar year.

Sec. 5725.32.  Upon the issuance of a tax credit certificate by the director of development, a refundable credit granted by the tax credit authority under section 122.17 of the Revised Code may be claimed against the tax imposed by section 5725.18 of the Revised Code. The credit shall be claimed in the calendar year specified in the certificate issued by the director of development.

Sec. 5727.01.  As used in this chapter:

(A)"Public utility" means each person referred to as atelephone company, telegraph company, electric company, naturalgas company, pipe-line company, water-works company, watertransportation company, heating company, rural electric company,railroad company, or combined company.

(B)"Gross receipts" means the entire receipts forbusinessdone by any person from operations as a public utility,orincidental thereto, or in connection therewith, including anyreceipts received under Chapter 4928. of the Revised Code. Thegrossreceipts for business done by an incorporated companyengaged inoperation as a public utility includes the entirereceipts forbusiness done by such company under the exercise ofits corporatepowers, whether from the operation as a publicutility or fromany other business.

(C)"Rural electric company" means any nonprofitcorporation,organization, association, or cooperative engaged inthe businessof supplying electricity to its members or personsowning aninterest therein in an area the major portion of whichis rural.

(D) Any person:

(1) Is a telegraph company when engaged in the business oftransmitting telegraphic messages to, from, through, or in thisstate;

(2) Is a telephone company when primarily engaged in thebusiness of providing local exchange telephone service, excludingcellular radio service, in this state;

(3) Is an electric company when engaged in the business ofgenerating, transmitting, or distributing electricity within thisstate for use by others, but excludes a rural electric company;

(4) Is a natural gas company when engaged in the businessofsupplyingor distributing natural gas for lighting, power, orheating purposesto consumers within this state, excluding aperson that is a governmental aggregator or retail natural gassupplier as defined in section 4929.01 of the Revised Code;

(5) Is a pipe-line company when engaged in the business oftransporting natural gas, oil, or coal or its derivatives throughpipes or tubing, either wholly or partially within this state;

(6) Is a water-works company when engaged in the businessofsupplying water through pipes or tubing, or in a similarmanner,to consumers within this state;

(7) Is a water transportation company when engaged in thetransportation of passengers or property, by boat or otherwatercraft, over any waterway, whether natural or artificial,fromone point within this state to another point within thisstate, orbetween points within this state and points withoutthis state;

(8) Is a heating company when engaged in the business ofsupplying water, steam, or air through pipes or tubing toconsumers within this state for heating purposes;

(9) Is a railroad company when engaged in the business ofowning or operating a railroad either wholly or partially withinthis state on rights-of-way acquired and held exclusively bysuchcompany, or otherwise, and includes a passenger, street,suburban,or interurban railroad company.

As used in division (D)(2) of this section,"local exchangetelephone service" means making available or furnishing accessanda dial tone to all persons within a local calling area foruse inoriginating and receiving voice grade communications overaswitched network operated by the provider of the service withinthe area and for gaining access to other telecommunicationservices.

(E)"Taxable property" means the property required bysection5727.06 of the Revised Code to be assessed by the taxcommissioner, but does not include either of the following:

(1) An item of tangible personal property that for theperiod subsequent to the effective date of an air, water, ornoisepollution control certificate and continuing so long as thecertificate is in force, has been certified as part of thepollution control facility with respect to which the certificatehas been issued;

(2) An item of tangible personal property that during theconstruction of a plant or facility and until the item is firstcapable of operation, whether actually used in operation or not,is incorporated in or being held exclusively for incorporation inthat plant or facility.

Notwithstanding section 5701.03 of the Revised Code, for tax year 2006 and thereafter, "taxable property" includes patterns, jigs, dies, and drawings of an electric company or a combined company for use in the activity of an electric company.

(F)"Taxing district" means a municipal corporation oftownship, or part thereof, in which the aggregate rate oftaxationis uniform.

(G)"Telecommunications service" has the same meaning asindivision (AA) of section 5739.01 of the Revised Code.

(H)"Interexchange telecommunications company" means apersonthat is engaged in the business of transmitting telephonicmessages to, from, through, or in this state, but that is not atelephone company.

(I)"Sale and leaseback transaction" means a transactioninwhich a public utility or interexchange telecommunicationscompanysells any tangible personal property to a person otherthan apublic utility or interexchange telecommunications companyandleases that property back from the buyer.

(J)"Production equipment" means all taxable steam, nuclear,hydraulic, and other production plant equipment used to generateelectricity. For tax years prior to 2001,"production equipment"includestaxable station equipment that is located at a productionplant.

(K)"Tax year" means the year for which property or grossreceipts are subject to assessment under this chapter. Thisdivision does notlimit the tax commissioner's ability to assessand value property or grossreceipts outside the tax year.

(L)"Combined company" means any person engaged in theactivityof an electric company or rural electric company that isalso engaged in theactivity of a heating company or a natural gascompany, or any combinationthereof.

(M) "Public utility property lessor" means any person, other than a public utility or an interexchange telecommunications company, that leases personal property, other than in a sale and leaseback transaction, to a public utility, other than a railroad, water transportation, telephone, or telegraph company if the property would be taxable property if owned by the public utility. A public utility property lessor is subject to this chapter only for the purposes of reporting and paying tax on taxable property it leases to a public utility other than a telephone or telegraph company. A public utility property lessor that leases property to a public utility other than a telephone or telegraph company is not a public utility, but it shall report its property and be assessed in the same manner as the utility to which it leases the property.

Sec. 5727.02.  As used in this chapter, "public utility,""electric company," "natural gas company," "pipe-line company,""water-works company," "water transportation company" or "heatingcompany" does not include any of the following:

(A) Any (1) Except as provided in division (A)(2) of this section, any person that is engaged in some other primarybusiness to which the supplying of electricity, heat, naturalgas,water, water transportation, steam, or air to others isincidental. As used in this division (A) of this section and in section 5727.031 of the Revised Code, "supplying ofelectricity"means generating, transmitting, or distributing electricity.

(2) For tax year 2009 and each tax year thereafter, a person that is engaged in some other primary business to which the supplying of electricity to others is incidental shall be treated as an "electric company" and a "public utility" for purposes of this chapter solely to the extent required by section 5727.031 of the Revised Code.

(B) Any person that supplies electricity, natural gas,water, water transportation, steam, or air to its tenants,whetherfor a separate charge or otherwise;

(C) Any person whose primary business in this stateconsistsof producing, refining, or marketing petroleum or itsproducts.

(D) Any person whose primary business in this state consistsof producing or gathering natural gas rather than supplying ordistributing natural gas to consumers.

Sec. 5727.031.  (A) For tax year 2009 and each tax year thereafter, a person that is engaged in some other primary business to which the supplying of electricity to others is incidental shall file a report under section 5727.08 of the Revised Code as an electric company but shall only report therein as taxable property the amounts required in divisions (B) and (C) of this section. All time limits and other procedural requirements of this chapter for the reporting and assessment of property of electric companies apply to persons required to file a report under this section.

(B) A person subject to this section shall report the true value of the boilers, machinery, equipment, and any personal property used to supply electricity to others, which shall be the sum of the following:

(1) The true value of the property that is production equipment as it would be determined for an electric company under section 5727.11 of the Revised Code multiplied by the per cent of the electricity generated in the preceding calendar year that was not used by the person who generated it; plus

(2) The true value of the property that is not production equipment as it would be determined for an electric company under section 5727.11 of the Revised Code multiplied by the per cent of the electricity generated in the preceding calendar year that was not used by the person who generated it.

(C) The property reported under division (B) of this section shall be listed and assessed at an amount equal to the sum of the products determined under divisions (C)(1) and (2) of this section.

(1) Multiply the portion of the true value determined under division (B)(1) of this section by the assessment rate in section 5727.111 of the Revised Code that is applicable to the production equipment of an electric company;

(2) Multiply the portion of the true value determined under division (B)(2) of this section by the assessment rate in section 5727.111 of the Revised Code that is applicable to the property of an electric company that is not production equipment.

Sec. 5727.06.  (A) Except as otherwise provided by law,the following constitutes the taxable property of a publicutility or, interexchange telecommunications company, or public utility property lessor that shall beassessed by the tax commissioner:

(1) For tax years before tax year 2006:

(a) In the case of a railroad company, all real propertyand tangible personal property owned or operated by the railroadcompany in this state on the thirty-first day of December of thepreceding year;

(2)(b) In the case of a water transportation company, all tangible personalproperty, except watercraft, owned or operated by the water transportationcompany in this state on the thirty-first day of December of the precedingyear and all watercraft owned or operated by the water transportation companyin this state during the preceding calendar year;

(3)(c) In the case of all other public utilities andinterexchange telecommunications companies, all tangible personalproperty that on the thirty-first day of December of thepreceding year was both located in this state and:

(a)(i) Owned by the public utility or interexchangetelecommunications company; or

(b)(ii) Leased by the public utility or interexchangetelecommunications company under a sale and leasebacktransaction.

(2) For tax years 2006, 2007, and 2008:

(a) In the case of a railroad company, all real property used in railroad operations and tangible personal property owned or operated by the railroad company in this state on the thirty-first day of December of the preceding year;

(b) In the case of a water transportation company, all tangible personal property, except watercraft, owned or operated by the water transportation company in this state on the thirty-first day of December of the preceding year and all watercraft owned or operated by the water transportation company in this state during the preceding calendar year;

(c) In the case of all other public utilities except telephone and telegraph companies, all tangible personal property that on the thirty-first day of December of the preceding year was both located in this state and either owned by the public utility or leased by the public utility under a sale and leaseback transaction.

(3) For tax year 2009 and each tax year thereafter:

(a) In the case of a railroad company, all real property used in railroad operations and tangible personal property owned or operated by the railroad company in this state on the thirty-first day of December of the preceding year;

(b) In the case of a water transportation company, all tangible personal property, except watercraft, owned or operated by the water transportation company in this state on the thirty-first day of December of the preceding year and all watercraft owned or operated by the water transportation company in this state during the preceding calendar year;

(c) In the case of all other public utilities except telephone and telegraph companies, all tangible personal property that on the thirty-first day of December of the preceding year was both located in this state and either owned by the public utility or leased by the public utility under a sale and leaseback transaction;

(d) In the case of a public utility property lessor, all personal property that on the thirty-first day of December of the preceding year was both located in this state and leased, in other than a sale and leaseback transaction, to an interexchange telecommunications company or a public utility other than a railroad company or water transportation company. The assessment rate used under section 5727.111 of the Revised Code shall be based on the assessment rate that would apply if the interexchange telecommunications company or public utility owned the property.

(4) For tax years 2005 and 2006, in the case of telephone, telegraph, or interexchange telecommunications companies, all tangible personal property that on the thirty-first day of December of the preceding year was both located in this state and either owned by the telephone, telegraph, or interexchange telecommunications company or leased by the telephone, telegraph, or interexchange telecommunications company under a sale and leaseback transaction.

(5) For tax year 2007 and thereafter, in the case of telephone, telegraph, or interexchange telecommunications companies, all tangible personal property shall be listed and assessed for taxation under Chapter 5711. of the Revised Code.

(B) In This division applies to tax years before tax year 2007.

In the case of an interexchange telecommunicationscompany, all taxable property shall be subject to the provisionsof this chapter and shall be valued by the commissioner inaccordance with division (A) of section 5727.11 of the RevisedCode. A persondescribedby this division shall file the report required by section5727.08 of the Revised Code. Persons described in this divisionshall not be considered taxpayers, as defined in division (B) ofsection 5711.01 of the Revised Code, and shall not be required tofile a return and list their taxable property under any provisionof Chapter 5711. of the Revised Code.

(C) The lien of the state for taxes levied each year onthe real and personal property of public utilities andinterexchange telecommunications companies and on the personal property of public utility property lessors shall attach theretoon the thirty-first day of December of the preceding year.

(D) Property that is required by division (A)(3)(b) ofthis section to be assessed by the tax commissioner under thischapter shall not be listed by the owner of the property underChapter 5711. of the Revised Code.

(E) The tax commissioner may adopt rules governing thelisting of the taxable property of public utilities andinterexchange telecommunications companies and the determinationof true value.

Sec. 5727.08.  On or before the first day of March,annually, each public utility and interexchange telecommunications company, and, for tax years 2009 and thereafter, each public utility property lessor, shall file a report with the taxcommissioner, on a form prescribed by the tax commissioner. The report shall include such information as the taxcommissioner requiresto enablethe tax commissioner to make any assessment or apportionmentrequired under thischapter.

The report shall be signed by either the owner of thepublic utility, interexchange telecommunications company, or public utility property lessor or the president, secretary, treasurer, or anotherduly authorized person.

If such a public utility, interexchange telecommunications company, or lessor fails to file the report on or beforethe first day of March, or the date it is due under an extensionallowed pursuant to section 5727.48 of the Revised Code, or failsto accurately report all taxable property, thetax commissioner may impose a penalty of up tofifty per cent of the taxablevalue ofthe property that was not timely or accuratelyreported. However, if the such a public utility, company, or lessorfiles, within sixty days afterthe first day of March or the extended due date, the report or anamended report and discloses all items of taxable property thatare required by this chapter to be reported,the penalty shall not be more than five per cent of the taxable valuethat wasnottimely oraccurately reported. The penalty shallbe added to andconsidered a part of the total taxable value of the property thatwas not timely or accurately reported, and may beabated in wholeor in part by the tax commissioner pursuant to a petition forreassessment filed under section 5727.47 of the Revised Code.

Sec. 5727.10.  Annually, the tax commissioner shalldetermine, in accordance with section 5727.11 of the RevisedCode, the true value in money of all taxable property, except property of a railroad company, required bydivision (A)(2) or (3) of section 5727.06 of the Revised Code to beassessed by the commissioner. The commissioner also shalldetermine the total taxable value of such property based on thepercentages of true value at which the property is required to beassessed by section 5727.111 of the Revised Code.

The commissioner shall be guided by the informationcontained in the report filed by the public utility and suchother evidence and rules as will enable him the commissioner tomake thesedeterminations.

Before issuing the preliminary assessment under section5727.23 of the Revised Code, the commissioner shall notify eachpublic utility of the proposed total taxable value of its taxableproperty, including any proposed penalty. After receiving suchnotice, a public utility may, upon written application, withinthe time prescribed by the commissioner, appear before him thecommissioner and beheard in the matter of the proposal. The commissioner may, onthe application of a public utility, or on his thecommissioner's own motion,correct the proposal.

Sec. 5727.11.  (A) Except as otherwise provided in thissection, the truevalue of all taxable property, except property of a railroad company, requiredbydivision (A)(2) or (3) of section 5727.06 of the Revised Code tobeassessed by the tax commissioner shall be determined by amethodof valuation using cost as capitalized on the publicutility'sbooks and records less composite annual allowances asprescribedby the commissioner. If the commissioner finds thatapplicationof this method will not result in the determination oftrue valueof the public utility's taxable property, thecommissionermay use another method of valuation.

(B)(1) Except as provided in division(B)(2)of thissection, the true value of current gas stored underground isthecost of that gas shown on the books and records of the publicutility on the thirty-first day of December of the precedingyear.

(2) For tax year 2001 and thereafter, the true value ofcurrentgas storedunderground is thequotientobtained bydividing (a) the average value of thecurrent gasstoredunderground, which shall be determined by adding the value of thegason hand at the end ofeach calendar month in the calendar yearpreceding the tax year, or, ifapplicable, the last day ofbusiness of each month for a partialmonth, divided by (b) thetotal number of months the naturalgascompany was in businessduring the calendar year prior to the beginning of thetaxyear.with the approval of the tax commissioner, a natural gas companymayuse a dateother than the end of a calendar month to value itscurrent gasstored underground.

(C) The true value of noncurrent gas stored underground isthirty-five per cent of the cost of that gas shown on the booksand records of the public utility on the thirty-first day ofDecember of the preceding year.

(D)(1) Except as provided in division(D)(2) of thissection, the true value of the productionequipment of anelectriccompany and the true value of all taxable property of aruralelectric company is the equipment's or property's cost ascapitalized on the company's books and records less fifty percentof that cost as an allowance for depreciation andobsolescence.

(2) The true value of the production equipment of anelectric company or rural electric company purchased, transferred,or placedinto serviceafter the effective date of thisamendmentis the purchase price of the equipment as capitalized onthecompany's books and records less composite annual allowancesasprescribed by the tax commissioner.

(E) The true value of taxable property described indivision(A)(2) or (3) of, except property of a railroad company, required by section 5727.06 of the Revised Code to be assessed by the tax commissioner shall notinclude the allowance for funds used during construction orinterest during construction that has been capitalized onthepublic utility's books and records as part of the total cost ofthe taxable property. This division shall not apply to thetaxableproperty of an electric company or a rural electriccompany, excludingtransmission and distribution property, firstplaced into service afterDecember 31, 2000, or to the taxableproperty a person purchases,which includes transfers, if thatproperty was used in business by the sellerprior to the purchase.

(F) The true value of watercraft owned or operated by awater transportationcompany shall be determined by multiplyingthe true value of the watercraft asdetermined under division (A)of this section by afraction, the numerator ofwhich is thenumber of revenue-earning miles traveled by the watercraft in thewaters of this state and the denominator of which is the number ofrevenue-earning miles traveled by the watercraft in all waters.

(G) The cost of property subject to a sale and leasebacktransaction is the cost of the property as capitalized on thebooks andrecords of the public utility owning thepropertyimmediately prior to the sale and leaseback transaction.

(H) The cost as capitalized on the books and records of apublicutility includes amounts capitalized that representregulatory assets, if suchamounts previously were included on thecompany's books and records ascapitalized costs of taxablepersonal property.

(I) Any change in the composite annual allowances asprescribedby the commissioner on a prospective basis shall not beadmissible in anyjudicial or administrative action or proceedingas evidence of value withregard to prior years' taxes.Information about the business, property, ortransactions of anytaxpayer obtained by the commissioner for the purpose ofadoptingor modifying the composite annual allowances shall not be subjecttodiscovery or disclosure.

Sec. 5727.111.  The taxable property of each publicutility,except a railroad company, and of each interexchangetelecommunications company shall be assessed at the followingpercentages of true value:

(A)(1) Except as provided in division(A)(2) of thissection, fifty per cent in the case of a ruralelectric company;

(2) For tax year 2001 and thereafter, fifty Fifty per cent in thecase ofthe taxable transmission anddistribution property of arural electriccompany, and twenty-five per cent for all its othertaxableproperty;

(B) In the case of a telephone or telegraph company,twenty-fiveper cent for taxable property first subject totaxation in this state for taxyear 1995 or thereafter for tax years before tax year 2007, and pursuant to division (H) of section 5711.22 of the Revised Code for tax year 2007 and thereafter, and the following for all other taxableproperty:

(1) For tax years prior to 2005, eighty-eight per cent;

(2) For tax year 2005, sixty-seven per cent;

(3) For tax year 2006, forty-six per cent;

(4) For tax year 2007 and thereafter, twenty-five per cent pursuant to division (H) of section 5711.22 of the Revised Code.

(C) Twenty-five per centin thecase of a natural gas company.

(D) Eighty-eight per cent in the case of a pipe-line,water-works, or heating company;

(E)(1) Except as provided in division(E)(2) or (3) of thissection, one hundred per cent in thecase of the taxableproduction equipment of an electric company andeighty-eight percent for all its other taxable property;

(2) For tax year 2001 and thereafter 2005, eighty-eight per centinthecase ofthe taxable transmission and distribution propertyof anelectric company, and twenty-five per cent for all itsothertaxableproperty;

(3) Property listed and assessed under divisions (B)(1)and(2) of section 5711.22 of the Revised Code and leased to anelectriccompany shallcontinue to be assessed at one hundred percent for production equipment andeighty-eight (2) For tax year 2006 and each tax year thereafter, eighty-five per cent in the case of the taxable transmission and distribution property of an electric company, and twenty-four per cent for allsuch its other taxable property until January1, 2002.

(F)(1) Twenty-five per cent in the case of aninterexchangetelecommunications company for tax years before tax year 2007;

(2) Pursuant to division (H) of section 5711.22 of the Revised Code for tax year 2007 and thereafter.

(G) Twenty-five per cent in the case of a watertransportation company.

Sec. 5727.12.  As used in this chapter, "property used inrailroad operations" means property used in or determined by thetax commissioner to be held by a railroad for use in railroadoperations. In determining the true value of all real andpersonal property owned or leased by each railroad company andused in railroad operations, the commissioner shall use theunitary method and value all of the property of the company'srailroad system as a whole, considering the factors generallyused in that method, and weighing each factor appropriately. Thetrue value of the property used in railroad operations shall beapportioned to this state as provided in section 5727.14 of theRevised Code. The commissioner shall separately determine thetrue For tax year 2006 and each tax year thereafter, the county auditor shall value of and assess the real property owned by the company that thecommissioner determines isnot used in railroad operations. The commissioner may requirethe advice of county auditors concerning suchvalues.

All property of a railroad shall be assessed for taxationat the same percentage of true value at which all other realproperty in this state is assessed, in the case of real property,and at the percentage of true value provided under divisions (E) and, (F), and (G) ofsection 5711.22 of the Revised Code, in the case of personalproperty.

A determination of the value of each tract, lot, or parcelof real property or each item of personal property not used inrailroad operations shall be considered a separate determinationwith respect to which a separate petition for reassessment may befiled under section 5727.47 of the Revised Code.

Where a line of railroad is subsidized under the terms ofthe federal regional rail reorganization act or the federal railrevitalization and regulatory reform act, the real and otherfixed property shall be assessed solely in the name of its owner.

Sec. 5727.23.  On or before the first Monday in October,annually, the tax commissioner shall assess the taxable propertyof each public utility. The and interexchange telecommunications company, and for tax year 2009 and thereafter of each public utility property lessor. If the taxpayer failed to file its annual report required by section 5727.08 of the Revised Code at least sixty days prior to the first Monday of October, the commissioner may make the assessment under this section within sixty days after the taxpayer files the report, but this does not preclude the commissioner from making an assessment without receiving the report.

The action of the tax commissioner shall be evidenced by apreliminary assessment that reflects the taxable valueapportioned to each county and each taxing district in thecounty. The commissioner may amend the preliminary assessment asprovided in this section. Each preliminary assessment andamended preliminary assessment shall be certified to the publicutility, interexchange telecommunications company, or public utility property lessor, and to, the auditor of each county to which taxable value hasbeen apportioned.

The county auditor shall place the apportioned taxablevalue on the general tax list and duplicate of real and publicutility property, and taxes shall be levied and collected thereonat the same rates and in the same manner as taxes are levied andcollected on real property in the taxing district in question.

Unless a petition for reassessment of an assessment hasbeen properly filed pursuant to section 5727.47 of the RevisedCode, each preliminary assessment and, if amended, eachpreliminary assessment as last amended shall become final ninetydays after certification of the preliminary assessment or thirtydays after certification of the amended preliminary assessment,whichever is later. If a petition for reassessment is properlyfiled, the assessment shall become final when the taxcommissioner issues a final determination.

Neither the certification of any preliminary or amendedassessment nor the expiration of the period of time that makesany assessment final constitutes a final determination,assessment, reassessment, valuation, finding, computation, ororder of the commissioner that is appealable under section5717.02 of the Revised Code.

Sec. 5727.241.  (A) As used in this section:

(1) "Tax otherwise due" means the tax imposed on a taxpayer under section 5727.24 of the Revised Code reduced by the total amount of all other nonrefundable credits, if any, that the taxpayer is entitled to claim.

(2) "Taxpayer" means any person subject to the tax imposed by section 5727.24 of the Revised Code.

(B) Upon the issuance of a tax credit certificate by the Ohio venture capital authority under section 150.07 of the Revised Code, a credit may be claimed against the tax imposed on a taxpayer under section 5727.24 of the Revised Code. The credit shall be claimed on a return due under section 5727.25 of the Revised Code after the certificate is issued by the authority.

(C) If the taxpayer elected a refundable credit under section 150.07 of the Revised Code and if the amount of the credit shown on the certificate does not exceed the tax otherwise due, then for the calendar year the taxpayer shall claim a refundable credit equal to the amount of the credit shown on the certificate.

(D) If the taxpayer elected a refundable credit under section 150.07 of the Revised Code, and if the amount of the refundable credit shown on the certificate exceeds the tax otherwise due, then for the calendar year the taxpayer shall claim a refundable credit equal to the sum of the following:

(1) The amount, if any, of the tax otherwise due;

(2) Seventy-five per cent of the difference between the amount of the refundable credit shown on the certificate and the tax otherwise due.

(E) If the taxpayer elected a nonrefundable credit under section 150.07 of the Revised Code and if the nonrefundable credit to which the taxpayer would otherwise be entitled under this section for any calendar year is greater than the tax otherwise due, the excess shall be allowed as a nonrefundable credit in each of the ensuing ten calendar years, but the amount of any excess nonrefundable credit allowed in the ensuing calendar year shall be deducted from the balance carried forward to the next calendar year.

Sec. 5727.84.  (A) As used in this section and sections5727.85,5727.86, and5727.87 of the Revised Code:

(1)"School district" means a city, local, or exemptedvillageschool district.

(2)"Joint vocational school district" means a jointvocationalschool district created under section 3311.16 of theRevisedCode,and includes a cooperative education school districtcreated undersection 3311.52 or 3311.521 of the Revised Code anda countyschool financing district created under section 3311.50of theRevised Code.

(3)"Local taxing unit" means a subdivision or taxing unit,as defined insection 5705.01 of the Revised Code, a park districtcreated under Chapter 1545. of the Revised Code, ora townshippark district established under section 511.23 of the RevisedCode,but excludesschool districtsand joint vocational schooldistricts.

(4)"State education aid" means the sum of state aidamounts computed for a schooldistrictor joint vocational schooldistrictunderChapter 3317. of theRevisedCode.

(5)"State education aid offset" means the amountdeterminedforeach school districtor joint vocational schooldistrict underdivision (A)(1) of section 5727.85ofthe RevisedCode.

(6)"Recognized valuation" hasthe same meaning asinsection3317.02 of the Revised Code.

(7)"Electric company tax value loss" means the amountdeterminedunder division (D) of this section.

(8)"Natural gas company tax value loss" means the amountdetermined underdivision (E) of this section.

(9)"Tax value loss" means the sum of the electric companytax value loss and thenatural gas company tax value loss.

(10)"Fixed-rate levy" means any tax levied on propertyotherthana fixed-sum levy.

(11)"Fixed-rate levy loss" means the amount determinedunderdivision (G) of this section.

(12)"Fixed-sum levy" means a tax levied on property atwhateverrate is required to produce a specified amount of taxmoney orlevied in excess of the ten-mill limitation to paydebtcharges, and includes school districtemergency levies imposedpursuant to section 5705.194 of theRevised Code.

(13)"Fixed-sum levy loss" means the amount determinedunderdivision (H) of this section.

(14)"Consumer price index" means the consumer priceindex(allitems, all urban consumers) prepared by the bureau of laborstatisticsof the United States department of labor.

(B)The kilowatt-hour tax receipts fund is hereby createdinthe state treasury and shall consist of money arising from thetaximposed by section5727.81 ofthe Revised Code. All money inthekilowatt-hour tax receipts fund shall be credited as follows:

(1) Fifty-nine and nine hundred seventy-six one-thousandthspercent, shall becredited to the generalrevenue fund.

(2) Two and six hundred forty-six one-thousandths per centshallbe credited to the local government fund, for distributionin accordancewith section 5747.50 of the Revised Code.

(3) Three hundred seventy-eight one-thousandths per centshall becredited to the local government revenue assistance fund,fordistribution in accordance with section 5747.61 of the RevisedCode.

(4) Twenty-five andfour-tenths per centshallbe creditedto the school districtproperty tax replacementfund,which ishereby created in the statetreasury for thepurpose ofmaking thepayments described insection 5727.85 of theRevisedCode.

(5) Eleven andsix-tenths per cent shall becredited to thelocalgovernment property tax replacement fund,which is herebycreated in thestate treasury for the purpose ofmaking thepayments described insection 5727.86 of the RevisedCode.

(6)In fiscal years 2002, 2003, 2004, 2005, and 2006, iftherevenue arisingfrom the tax levied bysection 5727.81 of theRevised Code is less than five hundredfifty-two million dollars,the amount credited to the generalrevenue fund under division(B)(1) of this section shall bereduced by the amountnecessary tocredit to each of the funds indivisions(B)(2)and (3) of thissection the amount itwould havereceived if the taxdid raisefive hundred fifty-two million dollars for thatfiscalyear. Thetax commissioner shallcertify to the director ofbudget andmanagement the amounts thatshall be credited underthis division.

(7) Beginning in fiscal year 2007, if the revenue arisingfrom the tax levied by section 5727.81 of the Revised Code is lessthan five hundred fifty-two million dollars, the amount creditedto the general revenue fund under division (B)(1) of this sectionshall be reduced by the amount necessary to credit to each of thefunds in divisions (B)(2), (3), (4), and (5) of this section theamount that it would have received if the tax did raise five hundred fifty-two million dollars for that fiscal year. The taxcommissioner shall certify to the director of budget andmanagement the amounts to be credited under division (B)(7) ofthis section.

(C)The naturalgas tax receipts fund is hereby createdinthe state treasury andshall consist of money arising from thetaximposed by section5727.811 of theRevised Code. All money inthefund shall be credited as follows:

(1)Sixty-eight and seven-tenths per cent shall becreditedtothe schooldistrict property tax replacement fund forthepurposeof makingthepayments described in section 5727.85 oftheRevisedCode.

(2) Thirty-one and three-tenths per cent shall be creditedto the localgovernmentproperty tax replacement fund for thepurpose of makingthe paymentsdescribed in section 5727.86 of theRevised Code.

(3) Beginning in fiscal year2007,if the revenue arisingfrom the tax levied bysection 5727.811 of theRevised Code isless than ninety milliondollars,anamountequal to thedifference betweenthe amount collected and ninety million dollarsshall betransferred from the general revenue fund toeach ofthefunds indivisions (C)(1) and(2) of this sectionin the samepercentages as ifthat amount had beencollected as taxes undersection 5727.811 ofthe Revised Code. Thetaxcommissioner shallcertify to thedirector of budget andmanagement the amounts thatshall betransferred under this division.

(D) Not later than January 1, 2002, the tax commissionershalldetermine for each taxing district its electric company taxvalue loss,which is the sumof the applicable amounts described in divisions(D)(1) to (3) ofthis section:

(1) The difference obtained by subtracting the amountdescribedin division (D)(1)(b) from the amount described indivision(D)(1)(a) of this section.

(a) The value of electric company and rural electric companytangible personal property as assessed by the tax commissioner fortax year1998 on a preliminaryassessment, or an amendedpreliminary assessment if issued prior toMarch 1, 1999, and asapportioned to the taxing districtfor tax year 1998;

(b) The value of electric company and rural electric companytangible personal property as assessed by the tax commissioner fortax year 1998 had the property been apportioned to the taxingdistrict for tax year 2001, and assessed at the rates in effectfor tax year 2001.

(2) The difference obtained by subtracting the amountdescribedin division (D)(2)(b) from the amount described indivision(D)(2)(a) of this section.

(a) The three-year average for tax years 1996, 1997, and1998 ofthe assessed value from nuclear fuel materials andassemblies assessedagainst a person under Chapter 5711. of theRevised Codefrom the leasing of them to an electric company forthose respective taxyears, as reflected in the preliminaryassessments;

(b) The three-year average assessed value from nuclear fuelmaterials and assemblies assessed under division (D)(2)(a)of thissection for tax years 1996, 1997, and 1998, as reflected in thepreliminaryassessments, using an assessment rate oftwenty-fiveper cent.

(3) In the case of a taxing district having a nuclear power plant within its territory, any amount, resulting in an electric company tax value loss, obtained by subtracting the amount described in division (D)(1) of this section from the difference obtained by subtracting the amount described in division (D)(3)(b) of this section from the amount described in division (D)(3)(a) of this section.

(a) The value of electric company tangible personal property as assessed by the tax commissioner for tax year 2000 on a preliminary assessment, or an amended preliminary assessment if issued prior to March 1, 2001, and as apportioned to the taxing district for tax year 2000;

(b) The value of electric company tangible personal property as assessed by the tax commissioner for tax year 2001 on a preliminary assessment, or an amended preliminary assessment if issued prior to March 1, 2002, and as apportioned to the taxing district for tax year 2001.

(E) Not later than January 1, 2002, the tax commissionershall determine for each taxing district its natural gas companytax valueloss, whichis the sum of the amounts described indivisions (E)(1) and(2) of this section:

(1) The difference obtained by subtracting the amountdescribedin division (E)(1)(b) from the amount described indivision(E)(1)(a) of this section.

(a) The value of all natural gas company tangible personalproperty, other than property described in division (E)(2) of thissection, as assessed by the tax commissioner for tax year 1999 onapreliminary assessment, or anamended preliminary assessment ifissued prior to March 1, 2000,and apportioned to the taxingdistrict for tax year 1999;

(b) The value of all natural gas company tangible personalproperty, other than property described in division (E)(2) of thissection, as assessed by the tax commissioner for tax year 1999 hadthe property been apportioned to the taxing district for tax year2001, and assessed at the rates in effect for tax year 2001.

(2) The difference in the value of current gas obtained bysubtracting the amount described in division(E)(2)(b) from theamount described in division (E)(2)(a) of thissection.

(a) The three-year average assessed value of current gas asassessed by the tax commissioner for tax years 1997, 1998, and1999 on apreliminary assessment, or an amendedpreliminaryassessment if issued prior to March 1, 2001, and asapportioned inthe taxing district for those respective years;

(b) The three-year average assessed value from current gasunderdivision (E)(2)(a) of this section for tax years1997, 1998,and1999, as reflected in the preliminary assessment, using anassessmentrate of twenty-five per cent.

(F) The tax commissioner may request that natural gascompanies,electric companies, and ruralelectric companies file areport to help determine the tax value lossunder divisions (D)and (E) ofthis section. The report shall be filedwithin thirtydays of the commissioner's request. A company that fails tofilethe report or does not timely file thereport is subject to thepenalty in section 5727.60 of the RevisedCode.

(G) Not later than January 1, 2002, the tax commissionershalldetermine for each school district, joint vocational schooldistrict, andlocal taxing unit its fixed-rate levy loss, which isthe sum of itselectric company tax value lossmultiplied bythetax rate in effect in tax year 1998 for fixed-rate levies and itsnatural gas company tax value loss multiplied by the tax rate ineffect in taxyear 1999 for fixed-rate levies.

(H) Not later than January 1, 2002, the tax commissionershalldetermine for each school district, joint vocational schooldistrict, andlocal taxing unit its fixed-sum levy loss, which isthe amount obtained by subtracting the amount described indivision (H)(2) of this section from the amount describedindivision (H)(1) of this section:

(1) The sum of the electric company tax value lossmultiplied by thetax rate in effect intax year 1998, and thenatural gas company tax value loss multipliedby the tax rate ineffect in tax year 1999, for fixed-sum leviesfor all taxingdistricts withineach school district, joint vocational schooldistrict, and localtaxing unit. For the years 2002 through 2006,this computation shallinclude school district emergency leviesthat existed in 1998in the caseof the electric company tax valueloss, and 1999 in the case of the naturalgas company tax valueloss, andall other fixed-sum levies that existed in 1998 in thecase of the electriccompany tax value loss and 1999 in the caseof the natural gas company taxvalue lossand continue to becharged in the tax year preceding the distribution year. For theyears 2007through 2016 in the case of school district emergencylevies, and for allyears after 2006 in the case of all otherfixed-sum levies, thiscomputation shall exclude allfixed-sumlevies thatexisted in 1998 in the case of the electric companytax value loss and 1999in the case of the natural gas company taxvalue loss, but are nolonger in effect in the tax yearprecedingthe distribution year. For the purposes of this section, anemergency levy that existed in 1998 in the case of the electriccompany taxvalue loss, and 1999 in the case of the natural gascompany tax valueloss, continues to exist in a year beginning onor after January 1, 2007, but before January 1, 2017, if, inthatyear, the board of education levies a school district emergencylevy foran annual sum at least equal to the annual sum levied bythe board in tax year1998 or 1999, respectively, less the amountof the paymentcertified underthis division for 2002.

(2) The total taxable value in tax year1999 less the taxvalue loss in each schooldistrict, jointvocational schooldistrict, and local taxing unitmultiplied byone-fourth of onemill.

If the amount computed under division(H) of this sectionfor anyschool district, joint vocational school district, orlocal taxing unit isgreater than zero, that amount shall equalthe fixed-sum levy loss reimbursedpursuant to division (E) ofsection 5727.85 of theRevised Code or division (A)(2)of section5727.86 of the Revised Code, and the one-fourth of onemill thatis subtracted under division (H)(2) of this sectionshall beapportionedamongall contributing fixed-sum levies in theproportion of each levy to the sum ofall fixed-sum levies withineach school district,joint vocational school district, or localtaxing unit.

(I) Notwithstanding divisions (D), (E), (G), and (H) ofthis section, incomputing the tax value loss, fixed-rate levyloss, and fixed-sum levy loss, the tax commissioner shall use thegreater ofthe 1998 tax rate or the 1999 tax rate in the case oflevy lossesassociated with the electric company tax value loss,but the 1999 tax rateshall notinclude for this purpose any taxlevy approved by the voters afterJune 30, 1999, and the taxcommissioner shall use the greater of the1999 or the 2000 taxrate in the case of levy losses associated with thenatural gascompany tax value loss.

(J) Not later than January 1, 2002, the tax commissionershall certify to the department of education the tax value lossdeterminedunder divisions (D) and (E) of this section for eachtaxingdistrict, the fixed-rate levyloss calculated underdivision (G) of this section, and thefixed-sum levy losscalculated under division (H) of this section.The calculationsunder divisions (G) and (H) of this section shallseparatelydisplay the levy loss for each levy eligible forreimbursement.

(K)Not later than September 1, 2001, the tax commissionershallcertify the amount of the fixed-sum levy loss to the countyauditor of each county in which a school district with a fixed-sumlevy loss has territory.

Sec. 5727.85.  (A) By the thirty-first day of July ofeachyear, beginning in 2002 andending in 2016, the department ofeducation shall determine the following foreach school districtand each joint vocational school districteligible for paymentunder division(C)or (D) of this section:

(1) The state education aid offset, which is the differenceobtained by subtracting the amount described in division(A)(1)(b)of this section from the amount described in division(A)(1)(a) ofthis section:

(a) The state education aid computed for the school districtor joint vocational school districtforthe current fiscal yearas of thethirty-first day of July;

(b) The state education aid that would be computed for theschooldistrictor joint vocational school district for thecurrent fiscal yearas of the thirty-first day of July if therecognized valuationincluded the taxvalue loss for the schooldistrictor joint vocational school district.

(2) Thegreater of zero or the difference obtained bysubtracting the stateeducationaid offset determined underdivision (A)(1) of thissection fromthe fixed-rate levy losscertified under division(J) ofsection5727.84 ofthe RevisedCode for all taxingdistricts in eachschool districtand jointvocational school district.

By the fifth day of August of each such year, the departmentof educationshall certify the amount sodeterminedunder division(A)(1) of this section to the director of budgetand management.

(B) Not later than the thirty-first day of October oftheyears 2006 through 2016, thedepartment of education shalldetermine all of the following for eachschool district:

(1) The amount obtained by subtracting the district's stateeducation aid computed for fiscal year 2002 from the district'sstateeducation aid computed for the current fiscal year;

(2) The inflation-adjusted property tax loss. Theinflation-adjusted property tax loss equals the fixed-rate levyloss, excluding the tax loss from levies within the ten-milllimitation to pay debt charges,determinedunder division (G) ofsection 5727.84 of theRevisedCode for all taxing districts ineach school district, plustheproduct obtained by multiplying thatloss by the cumulativepercentageincrease in the consumer priceindex from January 1,2002, to thethirtieth day of June of thecurrent year.

(3) The difference obtained by subtracting the amountcomputedunder division (B)(1) from the amount of theinflation-adjustedproperty tax loss. If this difference is zeroor a negative number, nofurther payments shall be made underdivision (C) of thissection to the school district from theschool district property taxreplacement fund.

(C)The department of educationshall pay from the schooldistrict propertytax replacement fundtoeach school districtall of thefollowing:

(1) In February 2002, one-half of the fixed-rate levy losscertified under division(J) of section 5727.84 of theRevisedCodebetween thetwenty-first and twenty-eighth days of February.

(2) From August 2002 through August 2006, one-half oftheamountcalculated for that fiscal year under division(A)(2) ofthis sectionbetween the twenty-first and twenty-eighthdays ofAugust and of February.

(3) From February 2007 through August 2016, one-half oftheamountcalculated for that calendar year under division(B)(3) ofthis sectionbetween the twenty-first andtwenty-eighth days ofAugust andof February.

(4) For taxes levied within the ten-mill limitation for debtpurposes in tax year 1998 in the case of electric company taxvalue losses, and in tax year 1999 in the case of natural gascompany tax value losses, payments shall be made equal to onehundred per cent of the loss computed as if the tax were afixed-rate levy, but those payments shall extend from fiscal year2006 through fiscal year 2016.

The department of education shall report to each schooldistrict the apportionment of the payments among the schooldistrict's funds based on the certifications under division (J) ofsection 5727.84 of the Revised Code.

(D) Not later than January 1, 2002, for all taxingdistrictsineach joint vocational school district, the tax commissionershall certify tothedepartmentof education thefixed-rate levyloss determinedunderdivision(G) of section5727.84 of theRevisedCode. FromFebruary 2002 toAugust 2016,thedepartmentshall pay fromthe schooldistrict property taxreplacement fundto thejoint vocationalschool district one-halfof theamountcalculated for that fiscal year underdivision(A)(2) of thissection between the twenty-first andtwenty-eighthdays of Augustand of February.

(E)(1) Not later than January 1, 2002, for each fixed-sumlevy leviedby each school districtor joint vocational schooldistrict and for each year forwhich a determination is madeunder division(H) of section 5727.84of the Revised Code that afixed-sum levy loss is to be reimbursed, thetax commissionershall certify to thedepartmentof education thefixed-sum levyloss determined underthatdivision. Thecertification shallcover a time period sufficientto include allfixed-sumleviesfor which the tax commissionermade such adetermination. Thedepartment shall pay fromtheschool districtproperty taxreplacement fund to theschooldistrict or joint vocationalschool district one-halfof thefixed-sum levyloss so certifiedfor each yearbetween thetwenty-first and twenty-eighth days ofAugust and of February.

(2) Beginning in 2003, by the thirty-first day ofJanuary ofeach year, the tax commissioner shall review thecertificationoriginally madeunder division (E)(1) of this section. If thecommissionerdetermines that adebt levy that had beenscheduledto be reimbursed inthe currentyear has expired, arevisedcertification for that and allsubsequent years shall bemade tothedepartment ofeducation.

(F) If the balance of the half-mill equalization fund created under section 3318.18 of the Revised Code is insufficient to make the full amount of payments required under division (D) of that section, the department of education, at the end of the third quarter of the fiscal year, shall certify to the director of budget and management the amount of the deficiency, and the director shall transfer an amount equal to the deficiency from the school district property tax replacement fund to the half-mill equalization fund.

(G)Beginning in August 2002,and ending in February May 2017,the director of budget and managementshall transfer from theschool district property tax replacementfund to the generalrevenue fund each of the following:

(1) Between the twenty-eighth day of August and the fifthday of September, the lesser of one-half of the amount certifiedfor that fiscal year under division (A)(2) of this section or thebalance in the school district property tax replacement fund;

(2) Between the first and fifth days of March May, the lesser ofone-half of the amount certified for that fiscal year underdivision (A)(2) of this section or the balance in the schooldistrict property tax replacement fund.

(G)By August 5, 2002, the tax commissioner shallestimatetheamount of money in the school district property taxreplacement fund inexcess of the amount necessary to makepayments underdivisions (C), (D), (E), and (F)of thissection.Notwithstanding division (C) of this section,thedepartment ofeducation, in consultation with the taxcommissionerand fromthose excessfunds, may pay anyschooldistrict four andone-halftimes the amount certified underdivision (A)(2) of thissection.Payments shall be made in orderfrom the smallest annualloss tothe largest annual loss. Apayment madeunder thisdivision shallbe in lieu of the paymentto be made in August 2002underdivision(C)(2) of this section.No payments shall be madein themannerestablished in thisdivision to any school districtwith annuallossesfrom permanentimprovement fixed-rate levies inexcess oftwenty thousanddollars, or annual losses from any otherfixed-rate levies inexcess of twenty thousand dollars. A schooldistrict receiving apayment under this division is no longerentitled to any furtherpayments under division (C) of thissection.

(H) On the thirty-first day of July of 2003, 2004, 2005,and2006, and on thethirty-first day of January and July of 2007andeach yearthereafter, if the amount credited to the schooldistrict propertytax replacement fund exceeds the amount neededto make paymentsfrom the fund under divisions (C), (D), (E),and(F)ofthis section, thedepartment of education shalldistributetheexcess among school districts andjoint vocationalschooldistricts. Theamountdistributed to eachdistrict shallbear thesame proportion to theexcess remaining inthe fund asthe ADM ofthe district bears tothe ADM of all of thedistricts.For thepurpose of thisdivision,"ADM" means theformula ADM inthe caseof aschooldistrict, and the averagedaily membershipreportedunder section3317.03of the RevisedCode in the case ofa jointvocationalschool district.

If, in the opinion of thedepartment of education,theexcess remaining in the schooldistrict property taxreplacementfund in any year is notsufficient to warrantdistribution underthis division, the excessshall remain to thecredit of the fund.

Amounts received by a school district or joint vocationalschooldistrict under this division shall be used exclusively forcapitalimprovements.

(H) On the first day of June each year, the director of budget and management shall transfer any balance remaining in the school district property tax replacement fund after the payments have been made under divisions (C), (D), (E), (F), and (G) of this section to the half-mill equalization fund created under section 3318.18 of the Revised Code.

(I) From fiscal year 2002 through fiscal year 2016,if thetotal amount in the school district property taxreplacement fundis insufficient to make all payments underdivisions (C), (D), and(E), and (F) of this sectionat the time the payments areto be made, thedirectorof budget and management shall transferfrom the generalrevenuefund to the school district property taxreplacement fundthedifference between the total amount to bepaid and the totalamount in the school district property taxreplacement fund, except that no transfer shall be made by reason of a deficiency to the extent that it results from the amendment of section 5727.84 of the Revised Code by Amended Substitute House Bill No. 95 of the 125th general assembly.

(J) If all or a part of the territory of a schooldistrictorjoint vocational school district is merged with an existing district, or if a part of the territory of a school district or joint vocational school district istransferredtoanother an existing or new district,the department of education, inconsultationwith the tax commissioner, shall adjust thepaymentsmade underthis section to each of the districts inproportion tothe taxvalue loss apportioned to the merged ortransferredterritory as follows:

(1) For the merger of all of the territory of two or more districts, the fixed-rate levy loss and the fixed-sum levy loss of the successor district shall be equal to the sum of the fixed-rate levy losses and the fixed-sum levy losses for each of the districts involved in the merger.

(2) For the transfer of a part of one district's territory to an existing district, the amount of the fixed-rate levy loss that is transferred to the recipient district shall be an amount equal to the transferring district's total fixed-rate levy loss times a fraction, the numerator of which is the value of electric company tangible personal property located in the part of the territory that was transferred, and the denominator of which is the total value of electric company tangible personal property located in the entire district from which the territory was transferred. The value of electric company tangible personal property under this division shall be determined for the most recent year for which data is available. Fixed-sum levy losses for both districts shall be determined under division (J)(4) of this section.

(3) For the transfer of a part of the territory of one or more districts to create a new district:

(a) If the new district is created on or after January 1, 2000, but before January 1, 2005, the new district shall be paid its current fixed-rate levy loss through August 2006. From February 2007 to August 2016, the new district shall be paid the lesser of: (i) the amount calculated under division (B) of this section or (ii) an amount determined under the schedule in division (A)(1) of section 5727.86 of the Revised Code, as if for this purpose the new district was a local taxing unit under that section. Fixed-sum levy losses for the districts shall be determined under division (J)(4) of this section.

(b) If the new district is created on or after January 1, 2005, the new district shall be deemed not to have any fixed-rate levy loss or, except as provided in division (J)(4) of this section, fixed-sum levy loss. The district or districts from which the territory was transferred shall have no reduction in their fixed-rate levy loss, or, except as provided in division (J)(4) of this section, their fixed-sum levy loss.

(4) If a recipient district under division (J)(2) of this section or a new district under division (J)(3)(a) or (b) of this section takes on debt from one or more of the districts from which territory was transferred, and any of the districts transferring the territory had fixed-sum levy losses, the department of education, in consultation with the tax commissioner, shall make an equitable division of the fixed-sum levy losses.

(K) There is hereby created the public utilitypropertytaxstudycommittee, effective January 1, 2011. The committeeshallconsistof the following seven members: the taxcommissioner,threemembers of the senate appointed by thepresident of thesenate,and three members of the house ofrepresentativesappointed by thespeaker of the house ofrepresentatives. Theappointments shallbe made not later thanJanuary 31, 2011. Thetax commissioner shall be thechairperson ofthe committee.

The committee shall study the extent to which each schooldistrictor joint vocational school district has been compensated,undersections 5727.84 and 5727.85 of the Revised Code as enactedbySubstitute Senate Bill No. 3 of the 123rd general assembly andanysubsequent acts, for the property tax loss caused by thereductionin the assessment rates for natural gas, electric, andrural electric companytangible personal property. Not later thanJune 30, 2011, thecommittee shall issue a report of its findings,including anyrecommendations for providing additionalcompensation for theproperty tax loss or regarding remediallegislation, to thepresident of the senate and the speaker of thehouse ofrepresentatives, at which time the committee shall ceaseto exist.

The department of taxation and department of education shallprovide such information and assistance as is required for thecommittee to carry out its duties.

Sec. 5728.01.  As used in sections 5728.02 to 5728.14 of theRevised Code:

(A)"Motor vehicle" means everything on wheels that isself-propelled, other than by muscular power or power collectedfrom electric trolley wires and other than vehicles or machinerynot designed for or employed in general highway transportation,used to transport or propel persons or property over a public highway.

(B)"Commercial car" means any motor vehicle used fortransporting persons or property, wholly on its own structure on a publichighway.

(C)"Commercial tractor" means any motor vehicle designedandused to propel or draw a trailer or semi-trailer or both on apublic highway without having any provision for carrying loadsindependently of such trailer or semi-trailer.

(D)"Trailer" means everything on wheels that is notself-propelled, except vehicles or machinery not designed for oremployed in general highway transportation, used for carryingproperty whollyon its own structureand for being drawn by amotor vehicle on a public highway,including any such vehicle whenformed by or operated as acombination of a semi-trailer and avehicle of the dolly typesuch as that commonly known as a trailerdolly."Trailer" does notinclude manufacturedhomes as definedindivision (C)(4) of section 3781.06 of the Revised Code ormobilehomes as defined in division (O) of section 4501.01 of theRevisedCode.

(E)"Semi-trailer" means everything on wheels that is notself-propelled, except vehicles or machinery not designed for oremployed in general highway transportation, designed and used forcarryingproperty on a publichighway when being propelled ordrawn by a commercial tractorwhen part of its own weight or theweight of its load, or both,rest upon and is carried by acommercial tractor.

(F)"Commercial tandem" means any commercial car andtraileror any commercial tractor, semi-trailer, and trailer whenfastenedtogether and used as one unit.

(G)"Commercial tractor combination" means any commercialtractor and semi-trailer when fastened together and used as oneunit.

(H)"Axle" means two or more load carrying wheels mountedina single transverse vertical plane.

(I)"Public highway" means any highway, road, or streetdedicated to public use, including a highway under thecontrolandjurisdiction of the Ohio turnpike commission createdby theprovisions of section 5537.02 of the Revised Codeand landandlots over which the public, either as user or owner, generallyhasa right to pass even though such land or lots are closedtemporarily by public authorities for the purpose of construction,reconstruction, maintenance, or repair.

(J) "Jurisdiction" means a state of the United States, the District of Columbia, or a province or territory of Canada.

Sec. 5728.02.  (A) Except as provided in section 5728.03ofthe Revised Code, every person who is liable for the taximposedby section 5728.06 of the Revised Code on the operationof acommercial car with three or more axles when operated alone or aspartof a commercial tandem, a commercial car with two axlesthatis to be operated as part of a commercial tandem with a grossvehicleweight or a registered gross vehicle weight exceedingtwenty-six thousandpounds, or acommercial tractor that is, or isto be, operated or driven upona public highway in two or more jurisdictions shall cause to befiled annually with the taxcommissioner a written an application forafuel use permit onblank forms to be furnished by thecommissioner for that purpose.

Each application for afuel use permit for acommercialcaror a commercial tractor shall contain anyinformation the taxcommissioner prescribes.

(B) Upon receipt of the application, thetax commissionershallissue to the person making the application afuelusepermitand any identification device that thecommissionerconsidersnecessary for the proper administration of thischapter.Thepermit and the identification device shall be of adesign andcontain any information the commissioner considersnecessary. Theidentification device shall be displayed on thecommercial car orcommercial tractor for which it was issued atall times in themanner the commissioner prescribes. Thefueluse permitsandtheidentification device shall not betransferable. In caseoftheloss of afuel use permit oridentification device,thecommissioner shall issue a duplicateof the permit or device.

Thefuel use permit shall be valid until it expiresorissuspended or surrendered.

Sec. 5728.03.  (A) In lieu of filing an application foranannualfuel use permit under section 5728.02 of theRevisedCodeand in lieu of filing returns under section 5728.08of theRevisedCode, a person who is the owner of a commercial carwiththree ormore axles when operated alone or as part of acommercialtandem,a commercial car with two axles that is to beoperated aspart ofa commercial tandem with a gross vehicleweight or aregisteredgross vehicle weight exceeding twenty-sixthousandpounds, or acommercialtractor that would otherwise be liable for the tax imposed by section 5728.06 of the Revised Code, that is, oris to be,operated ordriven upon apublic highway, may file anapplicationwith the taxcommissionerfor a single-tripfuelusepermit. Theapplication shall bebased on rules adopted by thetaxcommissioner andshall includeanamount estimated to besubstantially equivalent to the fueluse tax liability that the applicantwill incur by driving on thehighways of this state during theperiod covered by thesingle-trip permit. The amount soestimated shall be consideredto be the fuel use tax liabilityso incurred.

The commissioner may authorize independent permit servicesorother persons to issue single-tripfuel use permits.

(B) Thetax commissioner shall adopt rules establishing allofthe following:

(1) Procedures for the issuance of single-trip permits;

(2) The length of time the permits are effective;

(3) Requirements that independent permit services or otherpersons must meet to be authorized to issue single-tripfuelusepermits and procedures for obtaining that authorization;

(4) Estimates of the amount substantially equivalent tothefuel use tax liability that anapplicant will incur by driving onthe highways of this stateduring the period covered by thepermit.

(C) No person whosefuel use permit issued undersection5728.02 of the Revised Code is currently under suspensioninaccordance with section 5728.11 of the Revised Code shall beissued a single-tripfuel use permit under this section.

(D) All moneys collected pursuant to this section shall bedeposited in the state treasury in accordance with section5728.08of the Revised Code.

Sec. 5728.04. (A) Itis unlawfulfor anyperson to operate acommercial carwith three ormore axles when operatedalone or aspart of acommercial tandem,a commercial carwith two axles thatis to beoperated as part ofa commercial tandemwith a grossvehicleweight or a registeredgross vehicle weight exceedingtwenty-sixthousand pounds, or acommercial tractor when operatedaloneor aspart of acommercialtractor combination or commercialtandem that is subject to the tax imposed by section 5728.06 of the Revised Code on apublic highway in two or more jurisdictions under either of the following circumstances:

(1) Without a fuel use permit or single trip fuel use permit forsuchcommercial car orcommercial tractor.

(2) With a suspended or surrendered fuel use permit for such commercial car or commercial tractor.

(B) The judge or magistrate of any court finding any personguilty of unlawfullyoperating a commercial car or commercialtractor as provided for in thissection shall immediately notifythe tax commissioner of such violation andshall transmit to the taxcommissioner the name and the permanent address of theowner ofthe commercial car or commercial tractor operated in violation ofthissection, the registration number, the state of registration,and thecertificate of title number of the commercial car orcommercial tractor. The commercial car or commercial tractor involved in a violation of division (A)(1) or (2) of this section may be detained until a valid fuel use permit is obtained or reinstated.

Sec. 5728.06. (A) For the following purposes, an excise taxishereby imposedon the use of motor fuel to operate on thepublichighways of thisstate a commercial car with three or moreaxles, regardless of weight,operated alone oras part of a commercial tandem, acommercial carwith two axlesoperated as part of a commercialtandem having agross vehicleweight or registered gross vehicleweight exceedingtwenty-sixthousand pounds operated alone or as part of a commercial tandem, or a commercialtractor operated aloneor as partof a commercial tractorcombination or commercialtandem: toprovide revenue formaintaining thestate highwaysystem, to widenexisting surfaceson suchhighways,to resurfacesuch highways, toenable thecounties ofthe stateproperly toplan for, maintain,and repairtheir roads,to enablethemunicipal corporations toplan,construct,reconstruct,repave,widen, maintain, repair,clear,and cleanpublic highways,roads,and streets; to pay thatportionof theconstruction costof ahighway project that acounty,township,or municipalcorporationnormally would berequired topay, butthat thedirector oftransportation, pursuantto division(B) ofsection5531.08 of theRevised Code, determinesinsteadwill bepaid frommoneys in thehighway operating fund; tomaintain andrepairbridges andviaducts; to purchase, erect, andmaintainstreet andtrafficsigns and markers; to purchase, erect,andmaintaintraffic lightsand signals; to pay the costsapportionedto thepublic undersection 4907.47 of the RevisedCode; and tosupplement revenuealready available for suchpurposes, todistribute equitably amongthose persons using theprivilege ofdriving motor vehicles uponsuch highways and streetsthe cost ofmaintaining and repairingthe same, and to pay theinterest,principal, and charges on bondsand other obligationsissuedpursuant to Section 2i of ArticleVIII, Ohio Constitution,andsections 5528.30 and 5528.31 of theRevised Code. The tax isimposed in the same amount as the motorfuel tax imposed underChapter 5735. of the Revised Code plus anadditional tax of threecents per gallon of motor fuel used before July 1, 2004, provided that the additional tax shall be reduced to two cents per gallon of motor fuel used from July 1, 2004 through June 30, 2005,as determinedby thegallons consumed whileoperated onthe public highways of thisstate. Subject to section 5735.292 of the Revised Code, on and after July 1, 2005, the tax shall be imposed in the same amount as the motor fuel tax imposed under Chapter 5735. of the Revised Code. Payment of thefuel use taxshall be made by the purchaseof motorfuel withinOhio of suchgallons of motor fuel, for which the tax imposed under Chapter 5735. of the Revised Code has been paid, as is equivalent to thegallons consumedwhile operatingsuch a motor vehicle on thepublichighways ofthis state, or bydirect remittance to thetreasurerof state withthe fuel usetax return filed pursuant tosection 5728.08 of theRevised Code.

Any person subject to the tax imposed under this section whopurchasesmotor fuel in this state for use in another state inexcess of theamount consumed while operating such motor vehicleon the publichighways of this state shall be allowed a creditagainst the taximposed by this section or arefund equal tothemotor fuel tax paid to this state onsuch excess. No suchcreditor refund shall be allowed for taxespaid to any state thatimposes a tax on motor fuelpurchased or obtained in this stateand used on the highways ofsuch other state but does notallow asimilar credit orrefund for the tax paid to this state onmotorfuelpurchased or acquired in the other state and used onthepublichighways of this state.

The tax commissioner is authorized to determine whethersuchcredits or refunds are available and to prescribe such rulesasare required for the purpose of administering this chapter.

(B) Within sixty days after the last day of each month,thetaxcommissioner shall determine the amount of motor fueltaxallowedas a credit against the tax imposed by this section. Thecommissioner shall certify the amountto thedirector of budgetand management and the treasurer ofstate, whoshall credit theamount in accordance with section5728.08 of theRevised Code fromcurrent revenue arising from thetax levied bysection 5735.05 ofthe Revised Code.

(C) The owner of each commercial car and commercial tractorsubject to sections 5728.01 to 5728.14 of the Revised Codeisliable for the payment of the full amount of the taxesimposed bythis section.

An owner who is a person regularly engaged, forcompensation,in the business of leasing or renting motorvehicles withoutfurnishing drivers may designate that the lesseeof a motorvehicle leased for a period of thirty days or moreshall reportand pay the tax incurred during the duration of thelease. Anowner who is an independent contractor that furnishesboth thedriver and motor vehicle, may designate that the personsofurnished with the driver and motor vehicle for a period ofthirtydays or more shall report and pay the tax incurred duringthatperiod. An independent contractor that is not an owner, butthatfurnishes both the driver and motor vehicle and that hasbeendesignated by the owner of the motor vehicle to report andpay thetax, may designate that the person so furnished withdriver andmotor vehicle for a period of thirty days or moreshall report andpay the tax incurred during that period.

Sec. 5728.08.  Except as provided in section 5728.03 of theRevised Code and except as otherwise provided in this division (A) of section 5728.06 of the Revised Code,whoeveris liable for the payment of the tax leviedby section5728.06 of the Revised Code, on or before the last dayof eachJanuary, April, July, and October, shall file with thetaxcommissioner, on forms prescribed by thecommissioner,afueluse tax return and make payment of thefull amount ofthetax duefor the operation of each commercialcar andcommercialtractorfor the preceding three calendarmonths.Ifthecommercialcarsor commercial tractors are farmtrucks andtheamountofmotorfuel used to operate the trucksduring theprecedingtwelvecalendar months was less thanfifteenthousandgallons, thefueluse tax return shall befiledand the fullamount of taxdue paidonor before the lastday ofeachJuly forthepreceding twelvecalendar months.Ifthecommercial carsorcommercial tractors arefarm trucks andtheamount of motorfuelused to operate thetrucks during thepreceding twelvecalendarmonths was fifteenthousand gallonsormore, thefueluse tax return shallbe filedand the fullamount of the tax duepaid either on or before thelastday ofeach July for thepreceding twelve calendar months,oron orbefore the last day ofeach January, April,July, andOctober forthe precedingthree calendarmonths, at the option oftheperson liable forpayment of the tax. If thecommercial carsorcommercial tractorsare not farm trucks, and if, in theestimationof thecommissioner, the amount of the tax due doesnotwarrantquarterlyfiling, the commissioner may authorize thefiling of thefuelusetax return and payment of the fullamountdue on or before thelast day ofeach July for theprecedingtwelve months.

Thecommissionershall immediately forward to thetreasurerofstate all money received from the tax levied bysection 5728.06ofthe Revised Code.

The treasurer of state shall place to the credit of the taxrefund fund created by section 5703.052 of the Revised Code, outof receipts from the taxes levied by section 5728.06 of theRevised Code, amounts equal to the refund certified by the taxcommissioner pursuant to section 5728.061 of the Revised Code.Receipts from the tax shall be used by the commissioner todefrayexpenses incurred by the department of taxation inadministeringsections 5728.01 to 5728.14 of the Revised Code.

All moneys received in the state treasury from taxes leviedby section 5728.06 of the Revised Code and fees assessed undersection 5728.03 of the Revised Codethat are notrequired to beplaced to the credit of the tax refundfund asprovided by thissection shall, during each calendar year,becredited to thehighway improvement bond retirement fundcreatedby section5528.12 of the Revised Code until thecommissioners ofthe sinkingfund certify to the treasurer ofstate, as requiredbysection5528.17 of the Revised Code, thatthere are sufficientmoneys tothe credit of the highwayimprovement bond retirementfund to meetin full all payments ofinterest, principal, andcharges for theretirement of bonds andother obligations issuedpursuant toSection 2g of Article VIII,Ohio Constitution, andsections5528.10 and 5528.11 of the RevisedCode due and payableduring thecurrent calendar year and duringthefollowingcalendar year.From the date of thereceipt of the certificationrequired bysection 5528.17 of theRevised Code by the treasurerof stateuntil the thirty-first dayof December of the calendaryear inwhich the certification ismade, all moneys received inthe statetreasury from taxes leviedunder section 5728.06 of theRevisedCode and fees assessed undersection 5728.03of the Revised Codethat are not required to be placed to thecredit of the tax refundfund as provided by this section shallbecredited to the highwayobligations bond retirement fundcreatedby section 5528.32 of theRevised Code until thecommissioners ofthe sinking fund certifyto the treasurer ofstate, as required bysection 5528.38 of theRevised Code, thatthere are sufficientmoneys to the credit ofthe highwayobligations bond retirementfund to meet in full allpayments ofinterest, principal, andcharges for the retirement ofbonds andother obligations issuedpursuant to Section 2i ofArticle VIII,Ohio Constitution, andsections 5528.30 and 5528.31of theRevised Code due and payableduring the current calendaryear andduring thefollowingcalendar year. Fromthe date ofthereceipt of the certificationrequired by section5528.38 oftheRevised Code by the treasurerof state until thethirty-firstdayof December of the calendaryear in which thecertification ismade, all moneys received inthe state treasuryfrom taxes leviedunder section 5728.06 of theRevised Code andfees assessed undersection 5728.03of theRevised Codethat are notrequired to beplaced to thecredit of the tax refund fund asprovided by thissection shall becredited to the highwayoperating fund created bysection 5735.291of the Revised Code,except as provided by thefollowingparagraph of thissection.

From the date of the receipt by the treasurer of state ofcertifications from the commissioners of the sinking fund, asrequired by sections 5528.18 and 5528.39 of the Revised Code,certifying that the moneys to the credit of the highwayimprovement bond retirement fund are sufficient to meet in fullall payments of interest, principal, and charges for theretirement of all bonds and other obligationsthat may beissuedpursuant to Section 2g of Article VIII, Ohio Constitution,andsections 5528.10 and 5528.11 of the Revised Code, and to thecredit of the highway obligations bond retirement fund aresufficient to meet in full all payments of interest, principal,and charges for the retirement of all obligations issued pursuantto Section 2i of Article VIII, Ohio Constitution, and sections5528.30 and 5528.31 of the Revised Code, all moneys received inthe state treasury from the taxes levied under section 5728.06andfees assessed undersection 5728.03 of theRevisedCodethat arenot required to be placed to thecreditof the taxrefund fund asprovided by this section, shallbedeposited to thecredit of thehighway operating fund.

As used in this section,"farm truck" means any commercialcaror commercial tractor that is registered as a farm truck underChapter 4503. of the Revised Code.

Sec. 5729.032.  Upon the issuance of a tax credit certificate by the director of development, a refundable credit granted by the tax credit authority under section 122.17 of the Revised Code may be claimed against the tax imposed by section 5729.03 of the Revised Code. The credit shall be claimed in the calendar year specified in the certificate issued by the director of development.

Sec. 5729.08. (A) As used in this section, "tax otherwise due" means the tax imposed on a foreign insurance company under section 5729.03 of the Revised Code reduced by the total amount of all other nonrefundable credits, if any, that the foreign insurance company is entitled to claim.

(B) Upon the issuance of a tax credit certificateby the Ohioventurecapital authority under section 150.07 of theRevised Code, a creditmay beclaimed against thetax imposed on a foreign insurancecompanyunder section 5729.03of the Revised Code. The creditshall beclaimed in the calendaryear specified in the certificateissuedby the authority.

(C) If the company elected a refundable credit under section 150.07 of the Revised Code and if the amount of the credit shown on the certificate does not exceed the tax otherwise due, then for the calendar year the company shall claim a refundable credit equal to the amount of the credit shown on the certificate.

(D) If the company elected a refundable credit under section 150.07 of the Revised Code, and the amount of the credit shown on the certificate exceeds the tax otherwise due under section 5729.03 of the Revised Code, than for the calendar year the company may receive a refund equal to seventy-five per cent of such excess. If shall claim a refundable credit equal to the sum of the following:

(1) The amount, if any, of the tax otherwise due;

(2) Seventy-five per cent of the difference between the amount of the refundable credit shown on the certificate and the tax otherwise due.

(E) If the company elected a nonrefundable credit, the amount of the credit shown on the certificate shall not exceed the amount of tax otherwise due. If the company elected a nonrefundable credit and the credit to which the company would otherwise be entitled under this section for any calendar year is greater than the tax otherwise due under section 5729.03 of the Revised Code, the excess shall be allowed as a nonrefundable credit in each of the ensuing ten calendar years, but the amount of any excess credit allowed in the ensuing calendar year shall be deducted from the balance carried forward to the next calendar year.

Sec. 5731.01.  As used in this chapter:

(A) The "value of the gross estate" of the decedent shallinclude, to the extent provided in sections 5731.03 to 5731.131of the Revised Code, the value, on the dae date of the decedent'sdeath or on an alternate valuation date prescribed by division(D) of this section, of all property, real or personal, tangibleor intangible, wherever situated, except real property situatedand tangible personal property having an actual situs outside ofthis state.

(B) Subject to the provisions of section 5731.011 of theRevised Code that permit a valuation of qualified farm propertyat its value for its actual qualified use, the value of anyproperty included in the gross estate shall be the price at whichsuch property would change hands between a willing buyer and awilling seller, neither being under any compulsion to buy or selland both having reasonable knowledge of relevant facts. Allrelevant facts and elements of value as of the valuation dateshall be considered in determining such value.

The rulings and regulations of the internal revenue serviceand decisions of the federal courts defining the principlesapplicable in determining fair market value for purposes of thefederal estate tax imposed by Subchapter A, Chapter 11 of theInternal Revenue Code of 1954, 26 U.S.C. 2001, as amended, shallbe applied in determining fair market value for purposes of theestate taxes imposed by this chapter, to the extent that theserulings, regulations, and decisions are not inconsistent with theexpress provisions of this chapter, but the actual determinationof the fair market value by the internal revenue service of anyasset included in the gross estate is not controlling forpurposes of the estate taxes imposed by this chapter, unless theperson filing the estate tax return and the tax commissioner haveagreed in writing to be bound by the federal determination, asprovided in section 5731.26 of the Revised Code.

(C) In the case of stock and securities of a corporationthe value of which, by reason of their not being listed on anexchange and by reason of the absence of sales of them, cannot bedetermined with reference to bid and asked prices, or withreference to sales prices, the value of them shall be determinedby taking into consideration, in addition to all other factors,the value of stock or securities of corporations engaged in thesame or a similar line of business which are listed on anexchange or which are traded actively in the over-the-countermarket.

If a valuation of securities is undertaken by reference tomarket transactions and if the block of securities to be valuedis so large in relation to actual sales on existing markets thatit could not be liquidated in a reasonable time withoutdepressing the market, the price at which the block could besold, as such, outside the usual market, as through anunderwriter, shall be considered in determining the value of suchblock of securities.

(D) "Alternate valuation date" means the date forvaluation of a gross estate permitted by filing an election underthis division. Whether or not an alternate valuation dateelection is available to an estate for federal estate taxpurposes or, if available, is made for the estate, the value ofthe gross estate may be determined, if the person required tofile the estate tax return so elects, by valuing all the propertyincluded in the gross estate on the alternate date, if any,provided in section 2032 (a) of the Internal Revenue Code of1954, 26 U.S.C. 2032(a), as amended as such section generallyapplies, for federal estate tax purposes, to the estates ofpersons dying on the decedent's date of death.

No deduction under this chapter of any item shall beallowed if allowance is, in effect, given by use of the alternatevaluation date. In the determination of any tax liability of anyestate in which an election is filed under this division, allprovisions in this chapter which that refer to value at the time ofthe decedent's death shall be construed for all purposes to meanthe value of such property used in determining the value of thegross estate. For the purposes of the charitable deduction undersection 5731.17 of the Revised Code, any bequest, legacy, devise,or transfer enumerated in it shall be valued as of the date ofthe decedent's death with adjustment for any difference in value,not due to mere lapse of time or the occurrence or nonoccurrenceof a contingency, of the property as of the date six months afterthe decedent's death, or in case of its earlier disposition, onsuch date of disposition.

An election under this division shall be exercised on theestate tax return by the person required to file the return.When made, an election under this division is irrevocable. Anelection cannot be exercised under this division if a return isfiled more than one year after the time prescribed, including anyextensions of time granted, pursuant to law for filing thereturn.

(E) Unless otherwise indicated by the context, "county"means one of the following:

(1) The county in which the decedent's estate isadministered;

(2) If no administration of the decedent's estate is beinghad, the county of residence of the decedent at the time of his death;

(3) If the decedent dies a resident of another state, anycounty in which any property subject to tax is located.

(F) "Internal Revenue Code" means the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C. 1, as amended.

Sec. 5731.05.  (A) Except as provided in divisions (B) and(C) of this section, the value of the gross estate shall includethe value of all property, to the extent of any interest inproperty, of which the decedent has at any time made a transfer,by trust or otherwise, in contemplation of his death.

(B) Any transfer, except as provided in division (C) ofthis section, by trust or otherwise, made within a period ofthree years ending with the date of the decedent's death shall bedeemed to have been made in contemplation of death, unless thecontrary is shown. No transfer made before that three-yearperiod shall be treated as having been made in contemplation ofdeath.

(C) This section does not apply to any of the following:

(1) A bona fide sale for an adequate and fullconsideration in money or money's worth;

(2) A transfer of property that would not be included inthe decedent's gross estate if retained by him the decedentuntil death;

(3) The first ten thousand dollars of the transfers thatwere made by the decedent to each transferee, other than the spouse of thedecedent, in each calendar year, but only to the extent that those transfersqualify aspresent interests under section 2503(b) and (c) of the "InternalRevenue Code of 1986," 26 U.S.C. 2503, as amended. The exclusionprovided by division (C)(3) of this section does not apply to anyportion of a transfer that is treated as being made by the spouseof the decedent under section 2513 of the "Internal Revenue Codeof 1986," 26 U.S.C. 2513, as amended.

(4) A transfer of property made to the spouse of the transferor, except asprovided in section 5731.131 of the Revised Code;

(5) Federal or state gift taxes paid with respect to anyincludible transfer.

(D) The amendments made to this section by Amended Substitute House Bill No.111 and SubstituteSenate Bill No. 336 of the 118th general assembly that are effective on July1, 1993, shall applyonly to the estates of decedents who die on or after that date.

Sec. 5731.131.  (A) The value of the gross estate shallinclude the value of any property in which the decedent had anincome interest for life as follows:

(1)(A) If a marital deduction was allowed withrespect to the transfer of such property to the decedent undersection 2523(f) of the "Internal Revenue Code of1986," 26 U.S.C. 2523(f), as amended, in connection with the determination ofthe value of the taxable estate of the decedent's predeceasing spouse;

(2)(B) If the decedent's predeceasing spouse was not a resident of this state atthe time of his death and if a marital deduction was allowed withrespect tothe transfer of such property to the decedent under section 2056(b)(7) of the"Internal Revenue Code of 1986," 26 U.S.C. 2056(b)(7), as amended, inconnection with the determination of the value of the taxable estate of thedecedent's predeceasing spouse;

(3)(C) If the decedent's predeceasing spouse died prior to July 1, 1993, and ifa marital deduction was allowed with respect to the transfer of such propertyto the decedent under division (A)(1) of section 5731.15 of the Revised Codeas it existed prior to July 1, 1993, in connection with the determination ofthe value of the taxable estate of the decedent's predeceasing spouse;

(4)(D) If a qualified terminable interest property deduction was allowedwith respect to the transfer of such property to the decedent under division(B) of section 5731.15 of the Revised Code, in connection with thedetermination of the value of the taxable estate of the decedent'spredeceasing spouse.

(B) The amendments made to this section by Amended Substitute House Bill No.111 and substitute Senate Bill No. 336 of the 118thgeneral assembly that are effective on July1, 1993, shall apply only to the estates of decedents who die on or after thatdate.

Sec. 5731.14.  For purposes of the tax levied by section 5731.02 of theRevised Code, the value of the taxable estate shall be determined by deductingfrom the value of the gross estate deductions provided for in sections 5731.15to 5731.17 and 5731.20 of the Revised Code.

Sec. 5731.18.  (A) In addition to the tax levied bysection 5731.02 of the Revised Code, a tax is hereby levied uponthe transfer of the estate of every person dying on or after July1, 1968, who, at the time of his death was a resident of thisstate, in an amount equal to the maximum credit allowable bysubtitle B, chapter Chapter 11 of the Internal Revenue Code of1954, 26 U.S.C. 2011, as amended, for any taxes paid to anystate.

(B) The tax levied on any estate under this section shallbe credited with the amount of the tax levied under section5731.02 of the Revised Code and with the amount of any estate,inheritance, legacy, or succession taxes actually paid to anystate or territory of the United States or to the District ofColumbia on any property included in the decedent's gross estatefor federal estate tax purposes.

(C) The additional tax levied under this section shall beadministered, collected, and paid as provided in section 5731.24of the Revised Code.

Sec. 5731.181.  (A) For purposes of this section,"generation-skipping transfer," "taxable distribution," and"taxable termination" have the same meaning as in Chapter 13 ofsubtitle B of the Internal Revenue Code of 1986, 100 Stat. 2718,26 U.S.C. 2601-2624, as amended.

(B) A tax is hereby levied upon every generation-skippingtransfer of property having a situs in this state, that occurs atthe same time as, and as a result of, the death of an individual,in an amount equal to the credit allowed by Chapter 13 ofsubtitle B of the Internal Revenue Code of 1986, 100 Stat. 2718,26 U.S.C. 2601-2624, as amended, for any taxes paid to any statein respect of any property included in the generation-skippingtransfer.

For purposes of this division, "property having a situs inthis state" includes all the following:

(1) Real property situated in this state;

(2) Tangible personal property having an actual situs inthis state;

(3) Intangible personal property employed in carrying on abusiness in this state;

(4) Intangible personal property owned by a trust, thetrustee of which resides in or has its principal place ofbusiness in this state, or, if there is more than one trustee ofthe trust, the principal place of administration of which is inthis state.

(C) The return with respect to the generation-skipping taxlevied by division (B) of this section shall be filed in the formthat the tax commissioner shall prescribe, on or before the dayprescribed by law, including extensions, for filing thegeneration-skipping transfer tax return under Chapter 13 ofsubtitle B of the Internal Revenue Code of 1986, 100 Stat. 2718,26 U.S.C. 2601-2624, as amended, for the same generation-skippingtransfer. The return shall be filed by the distributee in thecase of a taxable distribution and by the trustee in the case ofa taxable termination.

(D) The generation-skipping tax levied by division (B) ofthis section shall be paid, without notice or demand by the taxcommissioner, with the return, and shall be charged, collected,and administered in the same manner as estate taxes levied bythis chapter. This chapter is generally applicable to, except tothe extent it is inconsistent with the nature of, thegeneration-skipping tax.

(E) If another state levies a generation-skipping tax on atransfer described in division (B) of this section, the taxcommissioner may enter into a compromise of thegeneration-skipping tax levied by division (B) of this section inthe manner provided in section 5731.35 of the Revised Code,except that no approval of any probate court is required. Ifsuch a compromise agreement is made, no interest and penaltiesshall accrue for the period prior to the execution of theagreement and for sixty days after its execution.

Sec. 5731.22.  (A) If the executor, administrator, or otherperson required to file a return fails to file the returnrequired by this chapter or to pay the tax due under this chapter on or before the date prescribed therefor,determined with regard to any extension of time for filing or payment,unless it is shown that such failure is due to reasonable causeand not due to willful neglect, there shall be added to theamount of tax as finally determined a penalty determined by thetax commissioner, in the amount of five ten per cent of the amount ofthat tax if the failure is not for more than one month, or, ifthe failure is for more than one month, in the amount of five percent of the amount of that tax plus an additional five per centfor each additional month or fraction of a month during which thefailure continues, not exceeding twenty-five per cent in theaggregate. If, due to fraud, there is a failure to file thereturn or an underpayment of tax due under this chapter, thereshall be added to the amount of tax as finally determined apenalty determined by the tax commissioner, in an amount not toexceed ten thousand dollars the tax due and unpaid. The penalties penalty imposed by thissection shall be collected at the same time and in the samemanner as the tax itself.

The penalties penalty shall be charged against the executor,administrator, or other person having custody or control of anyproperty the transfer of which is subject to estate tax, and suchexecutor, administrator, or other person is personally liable forthe penalties. Such penalties penalty. The penalty shall be divided in the samemanner prescribed for the division of the tax in sections 5731.50and 5731.51 of the Revised Code.

(B) The county auditor, upon consultation with the county treasurer, shall remit a penalty imposed under this section on a person if that person applies for remission and shows that the failure to file the return or to pay the tax due under this chapter on or before the date prescribed for such filing or payment, determined with regard to any extension, was due to reasonable cause and not willful neglect. The county auditor shall notify the applicant of the remission decision by mail. If the county auditor denies the applicant's application for remission, the applicant, within sixty days after the notice of the county auditor's decision is mailed, may apply to the tax commissioner for review of the county auditor's decision. The application may be filed in person or by certified mail. If the application is filed by certified mail, the date of the United States postmark placed on the sender's receipt by the postal service shall be treated as the date of filing. The tax commissioner shall consider the application, determine whether the penalty should be remitted, and certify the determination to the applicant, the county auditor, and the county treasurer. The county auditor and county treasurer shall make any settlement, and the county treasurer shall correct the accounts required to be kept under section 5731.46 of the Revised Code, as necessitated by the tax commissioner's determination. The applicant may file an exception to the tax commissioner's determination with the probate court as provided under section 5731.30 of the Revised Code.

The tax commissioner may issue orders and instructions for the uniform implementation of this division by the county auditors and county treasurers of all counties, and such officers shall follow such orders and instructions.

Sec. 5731.23.  Subject to division (A) of section 5731.25of the Revised Code or any other statute extending the time forpayment of an estate tax, the tax levied by section 5731.02 anddivision (A) of section 5731.19 of the Revised Code shall,without notice or demand by the tax commissioner, be due andpayable by the person liable for it, at the expiration of ninemonths from the date of the decedent's death, to the treasurer ofthe county. If any amount of tax levied by section 5731.02 ordivision (A) of section 5731.19 of the Revised Code is not paidon or before nine months from the date of the decedent's death,interest on such amount shall be paid for the period from suchdate to the date paid, computed at the rate per annum prescribedby federal short-term rate determined by the tax commissioner under section 5703.47 of the Revised Code. Interest at the samerate shall be paid on any amount of tax determined to be due byway of deficiency from nine months from the date of thedecedent's death to the date of payment thereof. Such interestshall be charged and collected in the same manner as the tax.

Interest computed at the rate per annum prescribed byfederal short-term rate determined by the tax commissioner under section 5703.47 of the Revised Code shall be allowed and paidupon any overpayment of tax levied by section 5731.02 or division(A) of section 5731.19 of the Revised Code from nine months fromthe date of the decedent's death or the date of payment of thetax, whichever is later, to the date such overpayment is repaid.Such payment may be made upon an estimated basis whether or not areturn is filed, and shall be charged and collected in the samemanner as provided in section 5731.21 of the Revised Code.

At any time after nine months from the date of thedecedent's death, payment of an estimated deficiency may be madeand shall be credited against any deficiency of tax finallydetermined. Interest on any deficiency ultimately determined tobe due shall be charged only upon the unpaid portion thereof.

Sec. 5731.39.  (A) No corporation organized or existingunder the laws of this state shall transfer on its books or issuea new certificate for any share of its capital stock registeredin the name of a decedent, or in trust for a decedent, or in thename of a decedent and another person or persons, without thewritten consent of the tax commissioner.

(B) No safe deposit company, trust company, financialinstitution as defined in division (A) of section 5725.01 of theRevised Code or other corporation or person, having inpossession, control, or custody a deposit standing in the name ofa decedent, or in trust for a decedent, or in the name of adecedent and another person or persons, shall deliver or transferan amount in excess of three-fourths of the total value of suchdeposit, including accrued interest and dividends, as of the dateof decedent's death, without the written consent of the taxcommissioner. The written consent of the tax commissioner neednot be obtained prior to the delivery or transfer of amountshaving a value of three-fourths or less of said total value.

(C) No life insurance company shall pay the proceeds of anannuity or matured endowment contract, or of a life insurancecontract payable to the estate of a decedent, or of any otherinsurance contract taxable under Chapter 5731. of the RevisedCode, without the written consent of the tax commissioner. Anylife insurance company may pay the proceeds of any insurancecontract not specified in this division (C) without the writtenconsent of the tax commissioner.

(D) No trust company or other corporation or person shallpay the proceeds of any death benefit, retirement, pension orprofit sharing plan in excess of two thousand dollars, withoutthe written consent of the tax commissioner. Such trust companyor other corporation or person, however, may pay the proceeds ofany death benefit, retirement, pension, or profit-sharing planwhich consists of insurance on the life of the decedent payableto a beneficiary other than the estate of the insured without thewritten consent of the tax commissioner.

(E) No safe deposit company, trust company, financialinstitution as defined in division (A) of section 5725.01 of theRevised Code, or other corporation or person, having inpossession, control, or custody securities, assets, or otherproperty (including the shares of the capital stock of, or otherinterest in, such safe deposit company, trust company, financialinstitution as defined in division (A) of section 5725.01 of theRevised Code, or other corporation), standing in the name of adecedent, or in trust for a decedent, or in the name of adecedent and another person or persons, and the transfer of whichis taxable under Chapter 5731. of the Revised Code, shall deliveror transfer any such securities, assets, or other property whichhave a value as of the date of decedent's death in excess ofthree-fourths of the total value thereof, without the writtenconsent of the tax commissioner. The written consent of the taxcommissioner need not be obtained prior to the delivery ortransfer of any such securities, assets, or other property havinga value of three-fourths or less of said total value.

(F) No safe deposit company, financial institution asdefined in division (A) of section 5725.01 of the Revised Code,or other corporation or person having possession or control of asafe deposit box or similar receptacle standing in the name of adecedent or in the name of the decedent and another person orpersons, or to which the decedent had a right of access, exceptwhen such safe deposit box or other receptacle stands in the nameof a corporation or partnership, or in the name of the decedentas guardian or executor, shall deliver any of the contentsthereof unless the safe deposit box or similar receptacle hasbeen opened and inventoried in the presence of the taxcommissioner or the commissioner's agent, and a written consent totransferissued; provided, however, that a safe deposit company, financialinstitution, or other corporation or person having possession orcontrol of a safe deposit box may deliver wills, deeds to buriallots, and insurance policies to a representative of the decedent,but that a representative of the safe deposit company, financialinstitution, or other corporation or person must supervise theopening of the box and make a written record of the wills, deeds,and policies removed. Such written record shall be included inthe tax commissioner's inventory records.

(G) Notwithstanding any provision of this section:

(1) The tax commissioner may authorize any delivery or transfer or waive anyof the foregoing requirements under such terms and conditions asthe commissioner may prescribe;

(2) An adult care facility, as defined in section 3722.01 of the RevisedCode, or a home,as defined in section 3721.10 of the Revised Code, may transfer or use themoney in apersonal needs allowance account in accordance with section 5111.112 5111.113 of theRevised Codewithout the written consent of the tax commissioner, and without the accounthaving been opened and inventoried in the presence of the commissioner or thecommissioner's agent.

Failure to comply with this section shallrender such safe deposit company, trust company, life insurancecompany, financial institution as defined in division (A) ofsection 5725.01 of the Revised Code, or other corporation orperson liable for the amount of the taxes and interest due underthe provisions of Chapter 5731. of the Revised Code on thetransfer of such stock, deposit, proceeds of an annuity ormatured endowment contract or of a life insurance contractpayable to the estate of a decedent, or other insurance contracttaxable under Chapter 5731. of the Revised Code, proceeds of anydeath benefit, retirement, pension, or profit sharing plan inexcess of two thousand dollars, or securities, assets, or otherproperty of any resident decedent, and in addition thereto, to apenalty of not less than five hundred or more than five thousanddollars.

Sec. 5731.41.  To enforce section 5731.39 of the RevisedCode, and to administer Chapters 5713. and 4503. of the Revised Code the tax commissioner may appoint agents in the unclassifiedcivil service who shall perform such duties as are prescribed bythe commissioner. Such agents shall, as compensation, receiveannually eight cents per capita for each full one thousand of thefirst twenty thousand of the population of the county and twocents per capita for each full one thousand over twenty thousandof the population of the county, as shown by the last federalcensus, which shall be paid in equal monthly installments fromthe undivided inheritance or estate tax in the county treasury onthe warrant of the county auditor or from the county real estate assessment fund pursuant to division (B)(6) of section 325.31 of the Revised Code, any other provision of law tothe contrary notwithstanding. The amount paid to any agent inthe unclassified service for all of the duties performed in estate taxmatters under this section, as directed by the commissioner, shall not exceed threethousand nor be less than twelve hundred dollars in any calendaryear.

Sec. 5733.01.  (A) The tax provided by this chapter fordomestic corporations shall be the amount charged against eachcorporation organized for profit under the laws of this state andeach nonprofit corporation organized pursuant to Chapter1729. ofthe Revised Code, except as provided in sections 5733.09and5733.10 of the Revised Code, for the privilege of exercisingitsfranchise during the calendar year in which that amount ispayable, and the tax provided by this chapter for foreigncorporations shall be the amount charged against each corporationorganized for profit and each nonprofit corporation organized oroperating in the same or similar manner as nonprofit corporationsorganized under Chapter 1729. of the Revised Code, under the lawsof any state or country other than this state, except as providedinsections 5733.09 and 5733.10 of the Revised Code, for theprivilege of doing business in this state, owning or using a partor all of its capital or property in this state, holding acertificate of compliance with the laws of this state authorizingit to do business in this state, or otherwise having nexus in orwiththis state under theConstitution of theUnitedStates,during the calendar year in whichthat amount is payable.

(B) A corporation is subject to the tax imposed by section5733.06 of the Revised Codefor each calendar year that it is soorganized, doingbusiness, owning or using a part or all of itscapital orproperty, holding a certificate of compliance, orotherwise having nexus in or withthis state under theConstitution of theUnitedStates,on the first dayof January ofthat calendar year.

(C) Any corporation subject to this chapter that is notsubject to the federal income tax shall file its returns andcompute its tax liability as required by this chapter in the samemanner as if that corporation were subject to the federal incometax.

(D) For purposes of this chapter, a federally charteredfinancial institution shall be deemed to be organized under thelaws of the state within which its principal office is located.

(E) Any For purposes of this chapter, any person, as defined in section 5701.01of the RevisedCode, shall betreated as acorporationfor purposes of thischapter if the personis classified for federalincome taxpurposes as an association taxable as a corporation, and an equity interest in the person shall be treated as capital stock of the person.

(F) For the purposes of this chapter, "disregarded entity"has the same meaning as in division (D) of section 5745.01 of theRevised Code.

(1) A person's interest in a disregarded entity, whetherheld directly orindirectly, shall be treated as the person'sownership of theassets and liabilities of the disregarded entity,and the income, including gain or loss,shall be included in theperson's net income under this chapter.

(2) Any sale, exchange, or other disposition of theperson'sinterest in the disregarded entity, whether held directlyorindirectly,shall be treated as a sale, exchange, or otherdisposition of theperson's share of the disregarded entity'sunderlying assets or liabilities, and the gain orloss from suchsale, exchange, or disposition shall be included inthe person'snet income under this chapter.

(3) The disregarded entity's payroll, property, and salesfactors shall beincluded in the person's factors.

(G) The tax a corporation is required to pay under this chapter shall be as follows:

(1)(a) For financial institutions, the greater of the minimum payment required under division (E) of section 5733.06 of the Revised Code or the difference between all taxes charged the financial institution under this chapter, without regard to division (G)(2) of this section, less any credits allowable against such tax.

(b) A corporation satisfying the description in division (E)(5), (6), (7), (8), or (10) of section 5751.01 of the Revised Code that is not a financial institution, insurance company, or dealer in intangibles is subject to the taxes imposed under this chapter as a corporation and not subject to tax as a financial institution, and shall pay the greater of the minimum payment required under division (E) of section 5733.06 of the Revised Code or the difference between all the taxes charged under this chapter, without regard to division (G)(2) of this section, less any credits allowable against such tax.

(2) For all corporations other than those persons described in division (G)(1)(a) or (b) of this section, the amount under division (G)(2)(a) of this section applicable to the tax year specified less the amount under division (G)(2)(b) of this section:

(a)(i) For tax year 2005, the greater of the minimum payment required under division (E) of section 5733.06 of the Revised Code or the difference between all taxes charged the corporation under this chapter and any credits allowable against such tax;

(ii) For tax year 2006, the greater of the minimum payment required under division (E) of section 5733.06 of the Revised Code or four-fifths of the difference between all taxes charged the corporation under this chapter and any credits allowable against such tax except the qualifying pass-through entity tax credit described in division (A)(30) and the refundable credits described in divisions (A)(31), (32), and (33) of section 5733.98 of the Revised Code;

(iii) For tax year 2007, the greater of the minimum payment required under division (E) of section 5733.06 of the Revised Code or three-fifths of the difference between all taxes charged the corporation under this chapter and any credits allowable against such tax except the qualifying pass-through entity tax credit described in division (A)(30) and the refundable credits described in divisions (A)(31), (32), and (33) of section 5733.98 of the Revised Code;

(iv) For tax year 2008, the greater of the minimum payment required under division (E) of section 5733.06 of the Revised Code or two-fifths of the difference between all taxes charged the corporation under this chapter and any credits allowable against such tax except the qualifying pass-through entity tax credit described in division (A)(30) and the refundable credits described in divisions (A)(31), (32), and (33) of section 5733.98 of the Revised Code;

(v) For tax year 2009, the greater of the minimum payment required under division (E) of section 5733.06 of the Revised Code or one-fifth of the difference between all taxes charged the corporation under this chapter and any credits allowable against such tax except the qualifying pass-through entity tax credit described in division (A)(30) and the refundable credits described in divisions (A)(31), (32), and (33) of section 5733.98 of the Revised Code;

(vi) For tax year 2010 and each tax year thereafter, no tax.

(b) A corporation shall subtract from the amount calculated under division (G)(2)(a)(ii), (iii), (iv), or (v) of this section any qualifying pass-through entity tax credit described in division (A)(30) and any refundable credits described in divisions (A)(31), (32), and (33) of section 5733.98 of the Revised Code to which the corporation is entitled. Any unused qualifying pass-through entity tax credit is not refundable.

(c) For the purposes of computing the amount of a credit that may be carried forward to a subsequent tax year under division (G)(2) of this section, a credit is utilized against the tax for a tax year to the extent the credit applies against the tax for that tax year, even if the difference is then multiplied by the applicable fraction under division (G)(2)(a) of this section.

(3) Nothing in division (G) of this section eliminates or reduces the tax imposed by section 5733.41 of the Revised Code on a qualifying pass-through entity.

Sec. 5733.065.  (A) As used in this section,"litterstreamproducts" means:

(1) Intoxicating liquor, beer, wine, mixedbeverages, orspirituous liquor as defined in section 4301.01 ofthe RevisedCode;

(2) Soft drinks as defined in section 913.22 of theRevisedCode;

(3) Glass, metal, plastic, or fiber containers with acapacity of less than two gallons sold for the purpose of beingincorporated into or becoming a part of a product enumerated indivisions (A)(1) and (2) of this section;

(4) Container crowns and closures sold for the purpose ofbeing incorporated into or becoming a part of a productenumeratedin divisions (A)(1) and (2) of this section;

(5) Packaging materials transferred or intended fortransferof use or possession in conjunction with retail sales ofproductsenumerated in divisions (A)(1) and (2) of this section;

(6) Packaging materials in the finished form in which theyare to be used, including sacks, bags, cups, lids, straws,plates,wrappings, boxes, or containers of any type used in thepackagingor serving of food or beverages, when the food orbeverages areprepared for human consumption by a restaurant ortake-out foodoutlet at the premises where sold at retail and aredelivered to apurchaser for consumption off the premises wherethe food orbeverages are sold;

(7) Cigarettes, cigars, tobacco, matches, candy, and gum.

(B) For the purpose of providing additional funding forthedivision of recycling and litter prevention under Chapter1502. ofthe Revised Code, there is hereby levied an additionaltax oncorporations for the privilege of manufacturing or sellinglitterstream products in this state. The tax imposed by this section isinaddition to the tax charged under section 5733.06 of theRevisedCode, computed at the rate prescribed by section 5733.066of theRevised Code. This section does not apply for tax year1981 to acorporation whose taxable year for tax year 1981 endedon orbefore June 30, 1980.

(C) The tax shall be imposed upon each corporation subjectto the tax imposed by section 5733.06 of the Revised Code thatmanufactures or sells litter stream products in this state. Thetax for each year shall be in an amount equal to the greater ofeither:

(1) Twenty-two hundredths of one per cent upon the valueofthat portion of the taxpayer's issued and outstanding sharesofstock as determined under division (B) of section 5733.05 oftheRevised Code that is subject to the rate contained indivision (B)of section 5733.06 of the Revised Code;

(2) Fourteen one-hundredths of a mill times the value ofthetaxpayer's issued and outstanding shares of stock asdeterminedunder division (C) of section 5733.05 of theRevisedCode.

The additional tax charged any taxpayer or group ofcombinedtaxpayers pursuant to this section for any tax yearshall notexceed five thousand dollars.

(D)(1) In the case of a corporation engaged in thebusinessof manufacturing litter stream products, no tax shall bedue underthis section unless the sale of litter stream productsin thisstate during the taxable year exceeds five per cent ofthe totalsales in this state of the corporation during thatperiod orunless the total sales in this state of litter streamproducts bythe corporation during the taxable year exceed tenmilliondollars.

(2) In the case of a corporation engaged in the businessofselling litter stream products in the form in which the itemis oris to be received, no tax shall be due under this sectionunlessthe corporation's sales of litter stream products in thisstateduring the taxable year constitute more than five per centof itstotal sales in this state during that period.

(3) In the case of a corporation transferring possessionoflitter stream products included in division (A)(6) of thissection, in which food or beverages prepared for humanconsumptionare placed, when the food or beverages are preparedfor retailsale at the premises where sold and are delivered to apurchaserfor consumption off the premises where the food orbeverages aresold, no tax shall be due under this section unlesssuch sales foroff-premises consumption during the taxable yearexceed five percent of the corporation's total annual salesduring the taxableyear.

(E)(1) The tax imposed by this section is due in theproportions and on the dates on which the tax imposed by section5733.06 of the Revised Code may be paid without penalty.

(2) Payment of the tax and any reports or returns requiredto enable the tax commissioner to determine the correct amount ofthe tax shall be submitted with and are due at the same time aspayments and reports required to be submitted under this chapter.

(3) If the tax is not paid in full on or before the daterequired by division (E)(1) of this section, the unpaid portionofthe tax due and unpaid shall be subject to all provisions ofthischapter for the collection of unpaid, delinquent taxesimposed bysection 5733.06 of the Revised Code, except that allsuch taxes,interest, and penalties, when collected, shall betreated asproceeds arising from the tax imposed by this sectionand shall bedeposited in the general revenue fund.

The tax levied on corporations under this section does notprohibit or otherwise limit the authority of municipalcorporations to impose an income tax on the income of suchcorporations.

Sec. 5733.066.  There shall be added to the rates contained in section 5733.06ofthe Revised Code the following:

(A) To the rate in division (A) of that section upon thatportion of the value of the taxpayer's issued and outstandingshares of stock as determined under division (B) of section5733.05 of the Revised Code that is subject to such rate, anadditional eleven-hundredths per cent upon that value to providefunding for the division of recyclingand litter prevention under Chapter 1502. of the Revised Code;

(B) To the rate in division (B) of that section upon thatportion of the value so determined that is subject to that rate,an additional twenty-two-hundredths per cent upon that value toprovide funding for the division recyclingand litter prevention under Chapter 1502. of the Revised Code;

(C) To the rate in division (C) of that section times thatportion of the value of the taxpayer's issued and outstandingshares of stock as determined under division (C) of section5733.05 of the Revised Code, an additional fourteenone-hundredths mills times that value to provide funding for thedivision of recycling and litter prevention under Chapter 1502.of the Revised Code.

The additional tax charged any taxpayer or group ofcombined taxpayers pursuant to this section for any tax yearshall not exceed five thousand dollars.

This section does not apply toany family farm corporation as defined in section 4123.01 of theRevised Code.

The tax levied on corporations under this section does notprohibit or otherwise limit the authority of municipalcorporations to impose an income tax on the income of suchcorporations.

Sec. 5733.33.  (A) As used in this section:

(1) "Manufacturing machinery and equipment" means enginesand machinery, and tools and implements, of every kind used, ordesigned to be used, in refining and manufacturing. "Manufacturing machinery and equipment" does not include propertyacquired after December 31, 1999, that is used:

(a) For the transmission and distribution of electricity;

(b) For the generation of electricity, if fifty per cent or moreof the electricity that the property generates is consumed, during theone-hundred-twenty-month periodcommencing with the date the property is placed in service, bypersons that are not related members to the person who generatesthe electricity.

(2) "New manufacturing machinery and equipment" meansmanufacturing machinery and equipment, theoriginal use in thisstate of which commences with the taxpayer or with a partnershipof which the taxpayer is a partner. "New manufacturing machinery and equipment" does not includeproperty acquired after December 31, 1999, that is used:

(a) For the transmission and distribution of electricity;

(b) For the generation of electricity, if fifty per cent or moreof the electricity that the property generates is consumed, during theone-hundred-twenty-month periodcommencing with the date the property is placed in service, bypersons that are not related members to the person who generatesthe electricity.

(3)(a) "Purchase" has the same meaning as in section179(d)(2)of the Internal Revenue Code.

(b) For purposes of this section, anyproperty that is not manufactured or assembled primarily by the taxpayeris considered purchased at the time the agreement toacquire theproperty becomes binding. Any property that ismanufactured or assembled primarily by the taxpayer is considered purchased atthe time the taxpayer places the property in service in the county for whichthe taxpayer will calculate the county excess amount.

(c) Notwithstanding section 179(d) of the Internal RevenueCode, a taxpayer's direct or indirect acquisition of newmanufacturing machinery and equipment is not purchased on or afterJuly 1, 1995, if the taxpayer, or a person whose relationship to the taxpayeris described in subparagraphs (A), (B), or (C) of section 179(d)(2) of theInternal Revenue Code, had directly orindirectly entered into a binding agreement to acquire theproperty at any time prior to July 1, 1995.

(4) "Qualifying period" means the period that begins July 1,1995, and ends December 31, 2015 June 30, 2005.

(5) "County average new manufacturing machinery andequipment investment" means either of the following:

(a) The average annual cost of newmanufacturing machinery and equipment purchased for use in thecounty during baseline years, in the caseof a taxpayer that was in existence for more than oneyearduring baseline years.

(b) Zero, in the case of a taxpayer that was notin existence for more than one year during baselineyears.

(6) "Partnership" includes a limitedliability company formed under Chapter1705. of the RevisedCode or under the laws of anyother state, provided that the company is not classified forfederal income tax purposes as an association taxable as acorporation.

(7) "Partner" includes a member of a limited liability company formedunder Chapter 1705. of the RevisedCode or under the laws of anyother state, provided that the company is not classified forfederal income tax purposes as an association taxable as acorporation.

(8) "Distressed area" means either a municipal corporationthat has a population of at least fifty thousand or a countythat meets two of the following criteria of economicdistress, or a municipal corporation the majority of the population of whichis situated in such a county:

(a) Its average rate of unemployment, during themost recent five-year period for which data are available, isequal to at least one hundred twenty-five per cent of theaverage rate of unemployment for the United States for the same period;

(b) It has a per capita income equal to or beloweighty per cent of the median county per capita income of theUnited States as determined by themost recently available figures from the UnitedStates census bureau;

(c)(i) In thecase of a municipal corporation, at least twenty per cent of theresidents have a total income for the most recent census yearthat is below the official poverty line;

(ii) In the case of a county, in intercensalyears, the county has a ratio of transfer payment income tototal county income equal to or greater than twenty-fiveper cent.

(9) "Eligible area" means a distressed area, a laborsurplus area, an inner city area, or a situational distressarea.

(10) "Inner city area" means, in a municipal corporationthat has a population of at least one hundred thousand and doesnot meet the criteria of a labor surplus area or a distressed area, targetedinvestment areas established by the municipal corporation withinits boundaries that are comprised of the most recent censusblock tracts that individually have at least twenty per cent oftheir population at or below the state poverty levelor other census block tracts contiguous to such census block tracts.

(11) "Labor surplus area" means an area designated as alabor surplus area by the United States department oflabor.

(12) "Official poverty line" has the same meaning as indivision (A) of section 3923.51 of the Revised Code.

(13) "Situational distress area" means a county or amunicipal corporation that has experienced or is experiencing aclosing or downsizing of a major employer, that will adverselyaffect the county's or municipal corporation's economy. Inorder to be designated as a situational distress area for aperiod not to exceed thirty-six months, the county or municipalcorporation may petition the director ofdevelopment. The petition shall include writtendocumentation that demonstrates all of the following adverse effects on thelocal economy:

(a) The number of jobs lost by the closing or downsizing;

(b) The impact that the job loss has on thecounty's or municipal corporation's unemployment rate asmeasured by the state director ofjob and family services;

(c) The annual payroll associated with the job loss;

(d) The amount of state and local taxes associated with the job loss;

(e) The impact that the closing or downsizing has on the suppliers located inthe county or municipal corporation.

(14) "Cost" has the same meaning and limitation as in section179(d)(3) of the Internal Revenue Code.

(15) "Baseline years" means:

(a) Calendar years 1992, 1993, and 1994, with regard to a creditclaimed for the purchase during calendar year 1995, 1996, 1997, or 1998 of newmanufacturing machinery and equipment;

(b) Calendar years 1993, 1994, and 1995, with regard to a creditclaimed for the purchase during calendar year 1999 of new manufacturingmachinery and equipment;

(c) Calendar years 1994, 1995, and 1996, with regard to a creditclaimed for the purchase during calendar year 2000 of new manufacturingmachinery and equipment;

(d) Calendar years 1995, 1996, and 1997, with regard to a creditclaimed for the purchase during calendar year 2001 of new manufacturingmachinery and equipment;

(e) Calendar years 1996, 1997, and 1998, with regard to a creditclaimed for the purchase during calendar year 2002 of new manufacturingmachinery and equipment;

(f) Calendar years 1997, 1998, and 1999, with regard to a creditclaimed for the purchase during calendar year 2003 of new manufacturingmachinery and equipment;

(g) Calendar years 1998, 1999, and 2000, with regard to a creditclaimed for the purchase during calendar year 2004 of new manufacturingmachinery and equipment;

(h) Calendar years 1999, 2000, and 2001, with regard to a creditclaimed for the purchase during calendar year 2005 on or after January 1, 2005, and on or before June 30, 2005, of new manufacturingmachinery and equipment;

(i) Calendar years 2000, 2001, and 2002, with regard to a credit claimed for the purchase during calendar year 2006 of new manufacturing machinery and equipment;

(j) Calendar years 2001, 2002, and 2003, with regard to a credit claimed for the purchase during calendar year 2007 of new manufacturing machinery and equipment;

(k) Calendar years 2002, 2003, and 2004, with regard to a credit claimed for the purchase during calendar year 2008 of new manufacturing machinery and equipment;

(l) Calendar years 2003, 2004, and 2005, with regard to a credit claimed for the purchase during calendar year 2009 of new manufacturing machinery and equipment;

(m) Calendar years 2004, 2005, and 2006, with regard to a credit claimed for the purchase during calendar year 2010 of new manufacturing machinery and equipment;

(n) Calendar years 2005, 2006, and 2007, with regard to a credit claimed for the purchase during calendar year 2011 of new manufacturing machinery and equipment;

(o) Calendar years 2006, 2007, and 2008, with regard to a credit claimed for the purchase during calendar year 2012 of new manufacturing machinery and equipment;

(p) Calendar years 2007, 2008, and 2009, with regard to a credit claimed for the purchase during calendar year 2013 of new manufacturing machinery and equipment;

(q) Calendar years 2008, 2009, and 2010, with regard to a credit claimed for the purchase during calendar year 2014 of new manufacturing machinery and equipment;

(r) Calendar years 2009, 2010, and 2011, with regard to a credit claimed for the purchase during calendar year 2015 of new manufacturing machinery and equipment.

(16) "Related member" has the same meaning as in section5733.042 of the Revised Code.

(B)(1) Subject to division (I) of this section, anonrefundable credit is allowed againstthe tax imposed by section 5733.06 of the Revised Code for ataxpayer that purchasesnew manufacturing machinery and equipment during the qualifyingperiod, provided that the new manufacturing machinery andequipment are installed in this state no later thanDecember 31, 2016 June 30, 2006. No credit shall be allowed under this section or section 5747.31 of the Revised Code for taxable years ending on or after July 1, 2005. The elimination of the credit for those taxable years includes the elimination of any remaining one-sevenths of credit amounts for which a portion was allowed for prior taxable years and the elimination of any credit carry-forward, but the purchases on which the credits were based remain subject to grants under section 122.173 of the Revised Code for those remaining one-seventh amounts or carry-forward amounts.

(2)(a) Except as otherwise provided in division(B)(2)(b)of this section, a credit may be claimed under this section in excess of onemillion dollars only if the cost of all manufacturing machineryand equipment owned in this state by the taxpayer claiming thecredit on the last day of the calendar year exceeds the cost ofall manufacturing machinery and equipment owned in this state bythe taxpayer on the first day of that calendar year.

As used in division (B)(2)(a) of thissection, "calendar year" means the calendar year in which the machinery andequipment for which the credit is claimed was purchased.

(b) Division (B)(2)(a)of this section does not apply if the taxpayer claiming thecredit applies for and is issued a waiver of the requirement ofthat division. A taxpayer may apply to the director of development for such awaiver in the mannerprescribed by the director, and the director may issue such awaiver if the director determines that granting the credit isnecessary to increase or retain employeesin this state, and that the credithas not caused relocation of manufacturing machinery andequipment among counties within this state for the primary purpose ofqualifying for the credit.

(C)(1) Except as otherwise provided in division (C)(2)and division (I) of this section, the credit amountis equal to seven and one-half per cent of the excess of the cost of the newmanufacturing machinery and equipmentpurchased during the calendar year for use in a county over the countyaverage new manufacturing machinery and equipment investment forthat county.

(2) Subject to division (I) of this section, asused in division (C)(2) ofthis section "county excess" means the taxpayer's excess costfor a county ascomputed under division (C)(1) of this section.

Subject to division (I) of this section, ataxpayer with a county excess, whose purchases included purchasesfor use in any eligible area in the county, thecredit amount is equal to thirteen and one-half per cent of thecost of the new manufacturing machinery andequipment purchased during the calendar year for use in theeligible areas in the county,provided that the cost subject to the thirteen and one-half per cent rateshall not exceed the county excess. If the county excess is greater than thecost of the new manufacturingmachinery and equipment purchased during the calendaryear for use in eligible areas in the county, the credit amountalso shall include an amount equalto seven and one-half per cent of the amount of the difference.

(3) If a taxpayer is allowed a credit for purchases of new manufacturingmachinery and equipment in more than one county or eligible area, it shallaggregate the amount of those credits each year.

(4) The taxpayer shall claim one-seventh of the creditamount for the tax year immediately following the calendar yearin which the new manufacturing machinery and equipment ispurchased for use in the county by thetaxpayer or partnership. One-seventh of thetaxpayer credit amount is allowed for each of the six ensuingtax years. Except for carried-forward amounts, the taxpayer is not allowedany credit amount remaining if thenew manufacturing machinery and equipment is sold by thetaxpayer or partnership or is transferred by the taxpayer orpartnership out of the county before the end of the seven-yearperiod unless, at the time of the sale or transfer, the new manufacturingmachinery and equipment has been fully depreciated for federal income taxpurposes.

(5)(a) A taxpayer that acquires manufacturing machineryand equipment as a result of a merger with thetaxpayer with whom commenced the original use in this state ofthe manufacturing machinery and equipment, or with a taxpayerthat was a partner in a partnership with whom commenced theoriginal use in this state of the manufacturing machinery andequipment, is entitled to any remaining or carried-forwardcredit amounts to which the taxpayer was entitled.

(b) A taxpayer that enters into an agreement under division(C)(3) of section 5709.62 of the Revised Code and that acquires manufacturingmachinery or equipment as aresult of purchasing a large manufacturing facility, as defined in section5709.61 of the Revised Code, from another taxpayer with whom commenced theoriginal use in thisstate of the manufacturing machinery or equipment, and that operates the largemanufacturing facility so purchased, is entitled to any remaining orcarried-forward credit amounts to which the other taxpayer who sold thefacility would have beenentitled under this section had the other taxpayer not sold the manufacturingfacility or equipment.

(c) New manufacturing machinery and equipment isnot considered sold if a pass-through entity transfers toanother pass-through entity substantially all of its assets aspart of a plan of reorganization under which substantially allgain and loss is not recognized by the pass-through entity thatis transferring the new manufacturing machinery and equipment tothe transferee and under which the transferee's basis in the newmanufacturing machinery and equipment is determined, in whole orin part, by reference to the basis of the pass-through entitywhich transferred the new manufacturing machinery and equipmentto the transferee.

(d) Division (C)(5) of this section shall apply only ifthe acquiring taxpayer or transferee does not sellthe new manufacturing machinery and equipment or transfer thenew manufacturing machinery and equipment out of the countybefore the end of the seven-year period to which division(C)(4) of this section refers.

(e) Division (C)(5)(b)of this section applies only to the extent that the taxpayer that sold themanufacturing machinery or equipment, upon request, timelyprovides to the tax commissioner any information that the taxcommissioner considers to be necessary to ascertain anyremaining or carried-forward amounts to which the taxpayer thatsold the facility would have been entitled under this sectionhad the taxpayer not sold the manufacturing machinery orequipment. Nothing in division (C)(5)(b)or (e) of this section shall be construed to allowa taxpayer to claim any credit amount with respect to theacquired manufacturing machinery or equipment that is greaterthan the amount that would have been available to the othertaxpayer that sold the manufacturing machinery or equipment hadthe other taxpayer not sold the manufacturing machinery orequipment.

(D) The taxpayer shall claim thecredit in the order required under section 5733.98 of theRevised Code. Each year, any creditamount in excess of the tax due under section 5733.06of the Revised Code afterallowing for any other credits that precede the credit underthis section in that order may be carried forward for threetax years.

(E) A taxpayer purchasing newmanufacturing machinery and equipment and intending to claim thecredit shall file, with the department of development, a noticeof intent to claim the credit on a form prescribed by thedepartment of development. The department of development shallinform the tax commissioner of the notice of intent to claim thecredit. No credit may be claimed under this section for any manufacturing machinery and equipment with respect to which a notice was not filed by the date of a timely filed return, including extensions, for the taxable year that includes September 30, 2005.

(F) The director of development shall annuallycertify, by the first day of January of eachyear during the qualifying period, the eligible areas for thetax credit for the calendar year that includes that first day ofJanuary. The director shallsend a copy of the certification to the tax commissioner.

(G) New manufacturing machinery and equipment for which ataxpayer claims the credit undersection 5733.31, 5733.311, 5747.26,or 5747.261 of the Revised Code shallnot be considered new manufacturing machinery and equipment for purposes ofthe credit under this section.

(H)(1) Notwithstanding sections 5733.11 and 5747.13 ofthe Revised Code, but subject to division (H)(2) ofthis section,the tax commissioner may issue an assessment against a person with respect toa credit claimed under this section for new manufacturing machinery andequipment described in division (A)(1)(b) or(2)(b) of this section, ifthe machinery or equipment subsequently doesnot qualify for the credit.

(2) Division (H)(1) of this section shall not apply afterthetwenty-fourth month following the last day of the period described indivisions (A)(1)(b) and (2)(b) ofthissection.

(I) Notwithstanding any other provision of thissection to the contrary, in the case of a qualifying controlledgroup, the credit available under thissection to a taxpayer or taxpayers in thequalifying controlled group shall be computed as if allcorporations in the groupwere asingle corporation. The credit shall be allocated tosuch a taxpayer ortaxpayers in the group in any amount elected for thetaxable year by the group. Such election shall be revocable and amendableduring theperioddescribed in division (B) of section 5733.12 of the Revised Code.

This division applies to all purchases of new manufacturingmachinery and equipment made on or after January 1, 2001, and toall baseline years used to compute any credit attributable to suchpurchases; provided, that this division may be applied solely atthe election of the qualifying controlled group with respect toall purchases of new manufacturing machinery and equipment madebefore that date, and to all baseline years used to compute anycredit attributable to such purchases. The qualifying controlledgroup at any time may elect to apply this division to purchasesmade prior to January 1, 2001, subject to the following:

(1) The election is irrevocable;

(2) The election need not accompany a timely filed report, butthe election may accompany a subsequently filed but timely applicationfor refund, a subsequently filed but timely amended report, or asubsequently filed but timely petition for reassessment.

Sec. 5733.351.  (A) As used in this section,"qualifiedresearchexpenses" has the same meaning as in section 41 of theInternalRevenue Code.

(B)(1) A nonrefundable credit is allowed against the taximposed by section 5733.06 of the Revised Code for tax year 2002for a taxpayer whose taxable year for tax year 2002 ended beforeJuly 1, 2001. The credit shall equal seven per cent of the excessof qualified research expenses incurred in this state by thetaxpayer between January 1, 2001, and the end of the taxable year,over the taxpayer's average annual qualified research expensesincurred in this state for the three preceding taxable years.

(2) A nonrefundable creditalso is allowed against the taximposed bysection 5733.06 of the Revised Code for each tax year,commencing with tax year 2004, and in the case of a corporation subject to division (G)(2) of section 5733.01 of the Revised Code ending with tax year 2008. The credit shall equal seven percent of the excess of qualified researchexpensesincurred in thisstate by the taxpayer for the taxable year over thetaxpayer'saverage annual qualified research expenses incurred in this statefor the three preceding taxable years.

(3) The taxpayershall claim the creditallowed underdivision (B)(1) or (2) of this section in the order requiredbysection 5733.98 of theRevised Code. Any credit amount inexcessof the tax dueunder section 5733.06 of the Revised Code,afterallowingfor any other credits that precede the credit underthissection in the orderrequired under section 5733.98 of theRevisedCode, may becarried forward for seven taxable years, buttheamount of the excess creditallowed in any such year shall bededucted from the balance carried forward tothe next year. A corporation subject to division (G)(2) of section 5733.01 of the Revised Code may carry forward any credit not fully utilized by tax year 2008 and apply it against the tax levied by Chapter 5751. of the Revised Code to the extent allowed under section 5751.51 of the Revised Code, provided that the total number of taxable years under this section and calendar years under Chapter 5751. of the Revised Code for which the credit is carried forward shall not exceed seven.

(C) In the case of a qualifying controlled group, the creditallowed underdivision (B)(1) or (2) of this section to taxpayersin the qualifying controlled groupshall be computed as if allcorporations in thequalifying controlled group were aconsolidated, single taxpayer. The credit shall be allocated tosuch taxpayers in any amountelected for the taxable year by thequalifying controlled group. The election shall be revocable andamendable during the periodprescribed by division (B) of section5733.12 of the Revised Code.

Sec. 5733.352. (A) As used in this section:

(1) "Borrower" means any person that receives a loan from the director of development under section 166.21 of the Revised Code, regardless of whether the borrower is subject to the taxes imposed by sections 5733.06, 5733.065, and 5733.066 of the Revised Code.

(2) "Related member" has the same meaning as in section 5733.042 of the Revised Code.

(3) "Qualified research and development loan payments" has the same meaning as in division (D) of section 166.21 of the Revised Code.

(B) Beginning in with tax year 2004, and in the case of a corporation subject to division (G)(2) of section 5733.01 of the Revised Code ending with tax year 2008, a nonrefundable credit is allowed against the taxes imposed by sections 5733.06, 5733.065, and 5733.066 of the Revised Code equal to a borrower's qualified research and development loan payments made during the calendar year immediately preceding the tax year for which the credit is claimed. The amount of the credit for a tax year shall not exceed one hundred fifty thousand dollars. No taxpayer is entitled to claim a credit under this section unless it has obtained a certificate issued by the director of development under division (D) of section 166.21 of the Revised Code. The credit shall be claimed in the order required under section 5733.98 of the Revised Code. The credit, to the extent it exceeds the taxpayer's tax liability for the tax year after allowance for any other credits that precede the credit under this section in that order, shall be carried forward to the next succeeding tax year or years until fully used. A corporation subject to division (G)(2) of section 5733.01 of the Revised Code may carry forward any credit not fully utilized by tax year 2008 and apply it against the tax levied by Chapter 5751. of the Revised Code to the extent allowed under section 5751.52 of the Revised Code.

(C) A borrower entitled to a credit under this section may assign the credit, or a portion thereof, to any of the following:

(1) A related member of that borrower;

(2) The owner or lessee of the eligible research and development project;

(3) A related member of the owner or lessee of the eligible research and development project.

A borrower making an assignment under this division shall provide written notice of the assignment to the tax commissioner and the director of development, in such form as the tax commissioner prescribes, before the credit that was assigned is used. The assignor may not claim the credit to the extent it was assigned to an assignee. The assignee may claim the credit only to the extent the assignor has not claimed it.

(D) If any taxpayer is a partner in a partnership or a member in a limited liability company treated as a partnership for federal income tax purposes, the taxpayer shall be allowed the taxpayer's distributive or proportionate share of the credit available through the partnership or limited liability company.

(E) The aggregate credit against the taxes imposed by sections 5733.06, 5733.065, 5733.066, and 5747.02 of the Revised Code that may be claimed under this section and section 5747.331 of the Revised Code by a borrower as a result of qualified research and development loan payments attributable during a calendar year to any one loan shall not exceed one hundred fifty thousand dollars.

Sec. 5733.40.  As used in sections 5733.40 and 5733.41 andChapter5747. of the Revised Code:

(A)(1)"Adjusted qualifying amount" means either of thefollowing:

(a) The sum of a each qualifying investor's distributiveshareof theincome, gain, expense, or loss of a qualifyingpass-throughentity for the qualifying taxable year of thequalifyingpass-throughentity multiplied by the apportionmentfractiondefined indivision (B) of this section, subject tosection5733.401 ofthe Revised Code anddivisions (A)(2) to(7)of thissection;

(b) The sum of a each qualifying beneficiary's share of thequalifying net incomeand qualifying net gain distributed by aqualifying trust for the qualifyingtaxable year of the qualifyingtrust multiplied by the apportionmentfraction defined in division(B) of this section, subject to section5733.401 of the RevisedCode and divisions (A)(2)to(6)(7) of this section.

(2) The sum shall exclude any amount which, pursuant to theConstitution ofthe United States, the Constitution of Ohio, orany federal law is not subjectto a tax on or measured by netincome.

(3) The sum shall be increased by For the purposes of Chapters 5733. and 5747. of the Revised Code, the profit or net income of the qualifying entity shall be increased by disallowing all amounts representingexpenses, otherthan amounts described in division(A)(7) ofthissection, that thequalifying entity paid to orincurred withrespect todirect or indirect transactions with oneor morerelated members,excluding the cost of goods soldcalculated inaccordance withsection 263A of the Internal RevenueCode andUnited Statesdepartment of the treasury regulationsissuedthereunder. Nothingin division (A)(3) of this sectionshall beconstrued to limitsolelyto this chapter the applicationofsection 263A of theInternal Revenue Codeand United Statesdepartment of the treasuryregulations issued thereunder.

(4) The sum shall be increased by For the purposes of Chapters 5733. and 5747. of the Revised Code, the profit or net income of the qualifying entity shall be increased by disallowing all recognized losses,other than losses from sales of inventory the cost of which iscalculated inaccordance with section 263A of the Internal RevenueCode and United Statesdepartment of the treasury regulationsissued thereunder, with respect to alldirect or indirecttransactions with one or more related members. Losses For the purposes of Chapters 5733. and 5747. of the Revised Code, losses fromthesales of such inventory shall be allowed only to the extent calculated in accordance withsection 482of the Internal Revenue Code and United Statesdepartment of the treasuryregulations issued thereunder. Nothingin division (A)(4) of this sectionshall be construed to limitsolely to this section the application of section 263A andsection 482 of the Internal Revenue Code andUnited Statesdepartmentof the treasury regulations issued thereunder.

(5)The sum shall be increased or decreased by an amountequal to the qualifying investor's or qualifying beneficiary'sdistributive or proportionate share of the amount that thequalifying entity would be required to add or deduct underdivisions (A)(20) and (21) of section 5747.01 of the Revised Codeif the qualifying entity were a taxpayer for the purposes ofChapter 5747. of the Revised Code.

(6) The sum shall be computed without regard to section5733.051 or division(D) of section 5733.052 of the Revised Code.

(7) For the purposes of Chapters 5733. and 5747. of theRevised Code,guaranteed paymentsor compensation paid toinvestors by aqualifying entitythat is not subject to the taximposedbysection 5733.06 of theRevised Codeshall be consideredadistributive share of incomeof thequalifying entity.Division(A)(7)of this sectionapplies only to such payments orsuchcompensation paid toan investor who at any time during thequalifyingentity'staxable year holds atleast a twenty per centdirect orindirectinterest in the profits orcapital of thequalifyingentity.

(B)"Apportionment fraction" means:

(1) With respect to a qualifying pass-through entityotherthan a financial institution, the fraction calculatedpursuant todivision (B)(2) of section 5733.05 of the Revised Codeas if thequalifying pass-through entity were a corporationsubject to thetax imposed by section 5733.06 of the Revised Code;

(2) With respect to a qualifying pass-through entity that isa financialinstitution, the fraction calculated pursuant todivision (C)of section 5733.056 of theRevised Code as if thequalifying pass-through entity were a financialinstitutionsubject to the tax imposed by section 5733.06 of the Revised Code.

(3) With respect to a qualifying trust, the fractioncalculated pursuant to division (B)(2) of section 5733.05 of theRevised Codeas if the qualifying trust were a corporation subjectto the tax imposed bysection 5733.06 of the Revised Code, exceptthat the property, payroll, andsales fractions shall becalculated by including in the numerator and denominator of thefractions only the property, payroll, and sales, respectively,directly related to the production of income or gain fromacquisition,ownership, use, maintenance, management, ordisposition oftangible personal property located in this state atany timeduring the qualifying trust's qualifying taxable year orof real propertylocated in this state.

(C)"Qualifying beneficiary" means any individual that,duringthe qualifying taxable year of a qualifying trust, is abeneficiary of thattrust, but does not include an individual whois a resident taxpayer for thepurposes of Chapter 5747. of theRevised Code for the entire qualifyingtaxable year of thequalifying trust.

(D)"Fiscal year" means an accounting period ending on anydayother than the thirty-first day of December.

(E)"Individual" means a natural person.

(F)"Month" means a calendar month.

(G)"Partnership" has the same meaning as in section 5747.01of the Revised Code.

(H)"Investor" means any person that, during any portion ofataxable year of a qualifying pass-through entity, is a partner,member, shareholder, or investor in that qualifying pass-throughentity.

(I) Except as otherwise provided in section 5733.402 or5747.401 of the Revised Code,"qualifying investor" means anyinvestor exceptthose described in divisions (I)(1) to (9) of thissection.

(1) An investor satisfying one of the descriptions undersection501(a) or (c) ofthe Internal Revenue Code, a partnershipwith equity securitiesregistered with the United Statessecurities and exchangecommission under section 12 of the"Securities Exchange Act of1934," as amended, oran investor described in division (F) ofsection 3334.01, or division (A)or (C) of section 5733.09 of theRevised Code for the entire qualifyingtaxableyear of thequalifying pass-through entity.

(2) An investor who is either an individual or an estate andis a resident taxpayer for the purposesof section 5747.01 of theRevised Code for the entire qualifying taxable yearof thequalifying pass-through entity.

(3) An investor who is an individual for whom the qualifyingpass-throughentity makes a good faith and reasonableeffort tocomply fully and timely with the filing and paymentrequirementsset forth in division (D) of section 5747.08 of the Revised Codeand section 5747.09 of the Revised Code with respect to theindividual'sadjusted qualifying amount for the entirequalifyingtaxable year of the qualifying pass-through entity.

(4) An investor that is another qualifying pass-throughentity having onlyinvestors described in division (I)(1),(2),(3), or (6) of this section during the three-year periodbeginningtwelve months prior to the first day of the qualifyingtaxableyear of the qualifying pass-through entity.

(5) An investor that isanother pass-through entity havingno investors other thanindividuals and estates during thequalifying taxable year ofthe qualifying pass-through entity inwhich it is an investor,and that makes a good faith andreasonable effort to comply fully and timelywith the filing andpayment requirements set forth in division (D) ofsection 5747.08of the Revised Code and section 5747.09 of the Revised Codewithrespect to investors that are not resident taxpayers of this statefor the purposes of Chapter 5747. of the Revised Codefor theentire qualifying taxable year of the qualifyingpass-throughentity in which it is aninvestor.

(6) An investor that is a financial institution required tocalculate the taxin accordance with division (D)(E) of section5733.06 of the Revised Code on thefirst day of January of thecalendar year immediately following the last dayof thefinancialinstitution's calendar or fiscal year in which ends the taxpayer'staxable year.

(7) An investor other than an individual that satisfies allthefollowing:

(a) The investor submits a written statement to thequalifyingpass-through entity stating that the investorirrevocably agrees that the investor has nexus with this stateunder theConstitution of the UnitedStates and is subject to andliable for the tax calculated under division (A) or (B)of section5733.06 of the Revised Codewith respect to the investor'sadjusted qualifyingamount for the entire qualifying taxable yearof the qualifyingpass-through entity. The statement is subjectto the penaltiesof perjury, shall be retained by the qualifyingpass-throughentity for no fewer than seven years, and shall bedelivered tothe tax commissioner upon request.

(b) The investor makes a good faith and reasonable effort tocomply timelyand fully with all the reporting and paymentrequirements set forth in Chapter5733. of the Revised Code withrespect to the investor's adjusted qualifyingamount for theentire qualifying taxable year of the qualifyingpass-throughentity.

(c) Neither the investor nor the qualifying pass-throughentityin which it is an investor, before, during, or after thequalifyingpass-through entity's qualifying taxable year,carriesout any transaction or transactions with one or more relatedmembersof the investor or the qualifying pass-through entityresulting in areduction or deferral of tax imposed by Chapter5733. of the Revised Codewith respect to all or any portion ofthe investor'sadjusted qualifying amount for the qualifyingpass-throughentity's taxable year, or thatconstitute a sham,lack economic reality, or are part of aseries of transactions theform of which constitutes a step transaction ortransactions ordoes not reflect the substance of those transactions.

(8) Any other investor that the tax commissioner maydesignate by rule. The tax commissioner may adopt rulesincludinga rule defining"qualifying investor" or"qualifying beneficiary"and governingthe imposition of the withholding tax imposed bysection 5747.41 of theRevised Code with respect to an individualwho is a resident taxpayer for thepurposes of Chapter 5747. ofthe Revised Codefor only a portion of the qualifying taxable yearof thequalifying entity.

(9) An investor that is a trust or fund the beneficiaries ofwhich, duringthe qualifying taxable year of the qualifyingpass-through entity, are limitedto the following:

(a) A person that is or may be the beneficiary of a trustsubject toSubchapter D of Chapter 1 of Subtitle A of the InternalRevenue Code.

(b) A person that is or may be thebeneficiary of or therecipient of payments from a trust or fundthat is a nucleardecommissioning reserve fund, a designatedsettlement fund, or anyother trust or fund established toresolve and satisfy claims thatmay otherwise be asserted by thebeneficiary or a member of thebeneficiary's family. Sections267(c)(4), 468A(e), and 468B(d)(2)of the Internal Revenue Code apply to thedetermination of whethersuch a person satisfies division (I)(9) of thissection.

(c) A person who is or may be the beneficiary of a trustthat, under itsgoverning instrument, is not required todistribute all of its incomecurrently. Division (I)(9)(c) ofthis section applies only if the trust,prior to the due date forfiling the qualifying pass-through entity's returnfor taxesimposed by section 5733.41 and sections 5747.41 to 5747.453 oftheRevised Code, irrevocably agrees in writing that for the taxableyearduring or for which the trust distributes any of its incometo any of itsbeneficiaries, the trust is a qualifying trust andwill pay the estimated tax,and will withhold and pay the withheldtax, as required undersections 5747.40 to 5747.453 of the RevisedCode.

For the purposes of division (I)(9) ofthis section, a trustor fund shall be considered to have abeneficiary other thanpersons described under divisions(I)(9)(a) to (c) of this sectionif a beneficiary wouldnot qualify under those divisions under thedoctrines of"economic reality,""sham transaction,""stepdoctrine," or"substance over form." A trust or fund described indivision(I)(9) of this section bears the burden of establishingby a preponderance ofthe evidence that any transaction givingrise to the tax benefits providedunder division (I)(9) of thissection does not have as a principal purpose aclaim of those taxbenefits. Nothing in this section shall be construed tolimitsolely to this section the application of the doctrinesreferredto in this paragraph.

(J)"Qualifying net gain" means any recognized net gain withrespect to the acquisition, ownership, use, maintenance,management, ordisposition of tangible personal property locatedin this state at any timeduring a trust's qualifying taxable yearor real property located inthis state.

(K)"Qualifying net income" means any recognized income, netofrelated deductible expenses, other than distributionsdeductionswith respect to the acquisition, ownership,use,maintenance, management, or disposition of tangible personalpropertylocated inthis state at any time during the trust'squalifying taxable year orreal property located in this state.

(L)"Qualifying entity" means a qualifying pass-throughentityor a qualifying trust.

(M)"Qualifying trust" means a trust subject to subchapter Jof the InternalRevenue Codethat, during any portion of thetrust's qualifying taxable year, has incomeor gain from theacquisition, management, ownership, use,or disposition oftangible personal property located in thisstate at any timeduring the trust's qualifying taxable year or realpropertylocated in this state."Qualifying trust" does notinclude aperson described in section 501(c) of the Internal Revenue Codeora person described in division (C) of section 5733.09 of theRevised Code.

(N)"Qualifying pass-through entity" means a pass-throughentityas defined in section 5733.04 of the Revised Code,excluding: a persondescribed in section 501(c)of the InternalRevenue Code,; a partnership with equity securities registeredwiththe United States securities and exchange commission undersection12 of the Securities Exchange Act of 1934, as amended,; or a persondescribed in division (C) of section 5733.09 of the Revised Code.

(O)"Quarter" means the first three months, the second threemonths, the third three months, or the last three months ofaqualifying entity's qualifying taxable year.

(P)"Related member" has the same meaning as in division(A)(6) of section5733.042 of the Revised Code without regard todivision (B) of that section. However, for the purposes ofdivisions (A)(3) and (4) of this section only,"related member"has the samemeaning as in division (A)(6) of section 5733.042 ofthe Revised Code withoutregard to division (B) of that section,but shall be applied by substituting"forty per cent" for"twentyper cent" wherever"twenty per cent" appears indivision (A) ofthat section.

(Q)"Return" or"report" means the notifications and reportsrequired to be filed pursuant to sections 5747.42 to 5747.45 ofthe RevisedCode for the purpose of reporting the tax imposedunder section 5733.41 or5747.41 of the Revised Code, and includeddeclarations of estimated tax whenso required.

(R)"Qualifying taxable year" means the calendar year or thequalifyingentity's fiscal year ending during the calendar year,or fractional partthereof, for which the adjusted qualifyingamount is calculated pursuant tosections 5733.40 and 5733.41 orsections 5747.40 to 5747.453 of the RevisedCode.

(S) "Distributive share" includes the sum of the income,gain, expense, or loss of a disregarded entity or qualified subchapter S subsidiary.

Sec. 5733.41.  The purpose of the tax imposed by this section is tocomplement and to reinforce the tax imposed under section 5733.06 of theRevised Code.

For the same purposes for which the tax is levied under section 5733.06of the Revised Code, there is hereby levied a tax on every qualifyingpass-through entity having at least one qualifyinginvestor that is not an individual. The tax imposed by this section isimposed on the sum of the adjusted qualifying amounts of the qualifyingpass-through entity's qualifying investors that are not individuals as follows: for qualifying investors subject to division (G)(2) of section 5733.01 of the Revised Code, at six and eight-tenths per cent for the entity's taxable year ending in 2005, at five and one-tenth per cent for the entity's taxable year ending in 2006, at three and four-tenths per cent for the entity's taxable year ending in 2007, at one and seven-tenths per cent for the entity's taxable year ending in 2008, and at zero per cent for the entity's taxable year ending in 2009 or in subsequent years; and for all other qualifying investors that are not individuals, at therate specified in division (B) of section 5733.06 of the Revised Codethat is in effect on the last day of the entity's taxable year.

The tax imposed by this section applies only if the qualifying entity hasnexus with this state under the Constitution of the United States for anyportion of the qualifying entity's qualifying taxable year, and the sum of thequalifying entity's adjusted qualifying amounts exceeds one thousand dollarsfor the qualifying entity's qualifying taxable year. This section does not apply to a pass-through entity ifall of the partners, shareholders, members, or investors of the pass-throughentity are taxpayers for the purposes of section 5733.04 of theRevised Code without regard to section 5733.09 of the Revised Code for theentire qualifying taxable year of the pass-through entity.

If, prior to the due date of the return, a qualifying pass-through entityreceives from an investor a written representation, under penalties ofperjury, that the investor is described in division (I)(1), (2), (6), (7),(8), or (9) of section 5733.40 of the Revised Code for the qualifyingpass-through entity's entire qualifying taxable year, the qualifyingpass-through entity is not required to withhold or pay the taxes or estimatedtaxes imposed under this section or sections 5747.41 to 5747.453 of theRevised Code with respect to that investor for that qualifying taxable year,and is not subject to any interest or interest penalties for failure towithhold or pay those taxes or estimated taxes with respect to that investorfor that qualifying taxable year.

If, prior to the due date of the return, a qualifyingtrust receives from a beneficiary of that trust a writtenrepresentation, under penalties of perjury, that the beneficiaryis a resident taxpayer for the purposes ofChapter 5747. of the Revised Code for the qualifying trust's entire qualifyingtaxable year, the qualifying trust is not required to withhold or pay thetaxes or estimated taxes imposed under this section or sections 5747.41 to5747.453 of the Revised Code with respect to thatbeneficiary for that qualifying taxable year, and is not subjectto any interest or interest penalties for failure to withhold orpay those taxes or estimated taxes with respect to thatbeneficiary for that qualifying taxable year.

The tax commissioner may adopt rules for the purpose ofthe tax levied by this section or section 5747.41 of the Revised Code,including a rule defining "qualifying investor" or "qualifying beneficiary","and a rule requiring or permitting a qualifying entity to combine its incomewith related members and to pay the tax and estimated tax on a combined basis.

Sections 5747.10 to 5747.19 and 5747.42 to 5747.453 of theRevised Code apply to a qualifying entity subject to the tax imposed underthis section.

The levy of the tax under this section does not prevent a municipalcorporation or a joint economic development district created under section715.70 or 715.71 or sections 715.72 to 715.81 of the Revised Code from levyinga tax on income.

Sec. 5733.49. (A) Upon the issuance of a tax credit certificateby the Ohioventure capital authority under section 150.07of theRevised Code, a creditmay be claimed against thetax imposed bysection 5733.06 of theRevised Code. The creditshall be claimedfor the tax yearspecified in the certificateissued by theauthority and in theorder required under section5733.98 of theRevised Code.

(B) If the taxpayer elected a refundable credit under section 150.07 of the Revised Code and the amount of the credit shown on the certificate does not exceed the tax otherwise due under section 5733.06, 5733.065, and 5733.066 of the Revised Code after all nonrefundable credits are deducted, then the taxpayer shall claim a refundable credit equal to the amount of the credit shown on the certificate.

(C) If the taxpayer elected a refundable credit undersection 150.07 of the Revised Code, and the amount of the creditshown on the certificate exceeds the tax otherwise due undersections 5733.06, 5733.065, and 5733.066 of the Revised Code afterall nonrefundable credits, including the credit allowed under this section, arededucted in that order, the taxpayer shall receive a refund equalto seventy-five per cent of that excess. If the taxpayer electeda nonrefundable credit, the amount of the credit, claimed in thatorder, shall not exceed the tax otherwise due under those sectionsafter all the taxpayer's credits are deducted in that order. If claim a refundable credit equal to the sum of the following:

(1) The amount, if any, of the tax otherwise due under sections 5733.06, 5733.065, and 5733.066 of the Revised Code after all nonrefundable credits are deducted;

(2) Seventy-five per cent of the difference between the amount of the refundable credit shown on the certificate and the tax otherwise due under sections 5733.06, 5733.065, and 5733.066 of the Revised Code after all nonrefundable credits are deducted.

(D) If the taxpayer elected a nonrefundable credit and the credit to which the taxpayer would otherwise be entitled under this section for any tax year is greater than the tax otherwise due under sections 5733.06, 5733.065, and 5733.066 of the Revised Code, after allowing for any other credits that, under section 5733.98 of the Revised Code, precede the credit allowed under this section, the excess shall be allowed as a nonrefundable credit in each of the ensuing ten tax years, but the amount of any excess credit allowed in the ensuing tax year shall be deducted from the balance carried forward to the next tax year.

Sec. 5733.98.  (A) To provide a uniform procedure forcalculating the amount of tax imposed by section 5733.06 of theRevised Codethat is due under this chapter, a taxpayershallclaim any credits to which it is entitled in the following order,except as otherwise provided in section 5733.058 of the RevisedCode:

(1) The For tax year 2005, the credit for taxes paid by a qualifying pass-throughentity allowedunder section 5733.0611 of the Revised Code;

(2) The credit allowed for financial institutions undersection 5733.45 of the Revised Code;

(3) The credit for qualifying affiliated groups undersection5733.068 of the Revised Code;

(4) The subsidiary corporation credit under section5733.067of the Revised Code;

(5) The savings and loan assessment credit under section5733.063 of the Revised Code;

(6) The credit for recycling and litter preventiondonationsunder section5733.064 of the Revised Code;

(7) The credit for employers that enter intoagreements withchild day-care centers under section 5733.36 of theRevised Code;

(8) The credit for employers that reimburse employee childcare expenses under section 5733.38 of the RevisedCode;

(9) The credit for maintaining railroad active gradecrossingwarningdevices under section 5733.43 of the RevisedCode;

(10) The credit for purchases of lights and reflectors undersection5733.44 of the Revised Code;

(11) The job retention credit under division (B) of section5733.0610 of the Revised Code;

(12) The credit forlosses on loans made under the Ohio venture capitalprogram under sections 150.01 to 150.10 of the Revised Code if thetaxpayer elected a nonrefundable credit under section 150.07 ofthe Revised Code;

(13) The credit for purchases of new manufacturingmachineryand equipment under section 5733.31 or section 5733.311of theRevised Code;

(14) The second credit for purchases of newmanufacturingmachinery and equipment undersection 5733.33 of theRevised Code;

(15) The job training credit under section 5733.42 oftheRevisedCode;

(16) The credit for qualified research expenses undersection 5733.351 ofthe Revised Code;

(17) The enterprise zone credit under section 5709.66 oftheRevised Code;

(18) The credit for the eligible costs associated with avoluntary action under section 5733.34of the Revised Code;

(19) The credit for employers that establish on-sitechildday-care centers under section 5733.37 of the RevisedCode;

(20)The ethanol plant investment credit under section5733.46 of the Revised Code;

(21) The credit for purchases of qualifying grapeproductionproperty under section 5733.32 of the Revised Code;

(22) The export sales credit under section 5733.069 oftheRevised Code;

(23) The credit for research and development andtechnologytransfer investors under section 5733.35 of the RevisedCode;

(24) The enterprise zone credits under section 5709.65oftheRevised Code;

(25) The credit for using Ohio coal under section5733.39oftheRevised Code;

(26)The research and development credit under section 5733.352 of the Revised Code;

(27) The credit for small telephone companies under section 5733.57 of the Revised Code;

(28)(27) The credit for eligible nonrecurring 9-1-1 charges under section 5733.55 of the Revised Code;

(29)(28) The credit for providing programs to aid the communicatively impaired under section 5733.56 of the Revised Code;

(30)(29) The research and development credit under section 5733.352 of the Revised Code;

(30) For tax years 2006 and subsequent tax years, the credit for taxes paid by a qualifying pass-through entity allowed under section 5733.0611 of the Revised Code;

(31) The refundable jobs creation credit underdivision(A)of section5733.0610 of the Revised Code;

(31)(32) The refundable credit for tax withheld underdivision(B)(2) of section 5747.062 of the Revised Code;

(32)(33) The credit for losses on loans made to the Ohio venture capital program under sections 150.01 to 150.10 of the Revised Code if the taxpayer elected a refundable credit under section 150.07 of the Revised Code.

(B) For any credit except thecredits enumeratedin divisions (A)(30), (31), and (32), and (33) of this section, the amount of thecredit for a tax year shall notexceedthe tax due after allowingfor any other credit thatprecedes itin the order required underthis section. Any excessamount of aparticular credit may becarried forward if authorizedunder thesection creating thatcredit.

Sec. 5737.03.  An annual excise tax is hereby levied on thehandling of grain, in lieu of all taxes on grain as property ofany person engaged in such business, for all the purposes forwhich taxes would otherwise be levied on such grain as propertyin the taxing district in which any such business is carried on,measured as follows:

One-half (A) For the statement due in 2005, one-half mill per bushel upon all wheat and flax handled atone or more places in this state in any such business during thetaxable year, as defined in section 5737.04 of the Revised Code, andone-fourth mill per bushel upon all other grain handled. The

(B) For the statement due in 2006, one-fourth mill per bushel upon all wheat and flax handled at one or more places in this state in any such business during the taxable year, as defined in section 5737.04 of the Revised Code, and one-eighth mill per bushel upon all other grain handled.

(C) No statement or tax is due in 2007 or any year thereafter.

The taximposed by this section shall not be paid by a track buyer, whoshall be liable for the personal property taxes only, as leviedby sections 5711.01 to 5711.36, inclusive, of the Revised Code.

All grain included in the statements required by section5737.04 of the Revised Code, upon the handling of which a tax isimposed by this section, is exempt from taxation as personalproperty. Any grain that would be included in such statements for taxable year 2007 or any year thereafter is exempt from taxation as personal property.

Sec. 5739.01.  As used in this chapter:

(A) "Person" includes individuals, receivers, assignees,trustees in bankruptcy, estates, firms, partnerships,associations, joint-stock companies, joint ventures, clubs,societies, corporations, the state and its politicalsubdivisions,and combinations of individuals of any form.

(B) "Sale" and "selling" include all of the followingtransactions for a consideration in any manner, whetherabsolutelyor conditionally, whether for a price or rental, inmoney or byexchange, and by any means whatsoever:

(1) All transactions by which title or possession, orboth,of tangible personal property, is or is to be transferred,or alicense to use or consume tangible personal property is oris tobe granted;

(2) All transactions by which lodging by a hotel is or istobe furnished to transient guests;

(3) All transactions by which:

(a) An item of tangible personal property is or is to berepaired, except property, the purchase of which would not besubject to the tax imposed by section 5739.02 of the Revised Code;

(b) An item of tangible personal property is or is to beinstalled, except property, the purchase of which would not besubject to the tax imposed by section 5739.02 of the Revised Codeorproperty that is or is to be incorporated into and will becomeapart of a production, transmission, transportation, ordistribution system for the delivery of a public utility service;

(c) The service of washing, cleaning, waxing, polishing,orpainting a motor vehicle is or is to be furnished;

(d) Until August 1, 2003, industrial laundry cleaning services are or are to beprovided and, on and after August 1, 2003, laundry and dry cleaning services are or are to be provided;

(e) Automatic data processing, computer services, orelectronic information services are or are to be provided for usein business when the true object of the transaction is thereceiptby the consumer of automatic data processing, computerservices,or electronic information services rather than thereceipt ofpersonal or professional services to which automaticdataprocessing, computer services, or electronic informationservicesare incidental or supplemental. Notwithstanding anyotherprovision of this chapter, such transactions that occurbetweenmembers of an affiliated group are not sales. Anaffiliated groupmeans two or more persons related in such a waythat one personowns or controls the business operation ofanother member of thegroup. In the case of corporations withstock, one corporationowns or controls another if it owns morethan fifty per cent ofthe other corporation's common stock withvoting rights.

(f) Telecommunications service, other than mobiletelecommunications service after July 31, 2002 including prepaid calling service, prepaid wireless calling service, or ancillary service, is or is to beprovided, but does not includetransactions bywhich localtelecommunications service is obtainedfrom a includingcoin-operatedtelephone and paid for by using coin service;

(g) Landscaping and lawn care service is or is to beprovided;

(h) Private investigation and security service is or is tobe provided;

(i) Information services or tangible personal property isprovided or ordered by means of a nine hundred telephone call;

(j) Building maintenance and janitorial service is or istobe provided;

(k) Employment service is or is to be provided;

(l) Employment placement service is or is to be provided;

(m) Exterminating service is or is to be provided;

(n) Physical fitness facility service is or is to beprovided;

(o) Recreation and sports club service is or is to beprovided.

(p) After July 31, 2002, mobile telecommunications service isor is to be provided when that service is sitused tothis state pursuant to the "MobileTelecommunications SourcingAct," Pub. L. No. 106-252, 114Stat. 626to 632 (2000), 4U.S.C.A. 116 to 126, as amended.

(q) On and after August 1, 2003, satellite broadcasting service is or is to be provided;

(r)(q) On and after August 1, 2003, personal care service is or is to be provided to an individual. As used in this division, "personal care service" includes skin care, the application of cosmetics, manicuring, pedicuring, hair removal, tattooing, body piercing, tanning, massage, and other similar services. "Personal care service" does not include a service provided by or on the order of a licensed physician or licensed chiropractor, or the cutting, coloring, or styling of an individual's hair.

(s)(r) On and after August 1, 2003, the transportation of persons by motor vehicle or aircraft is or is to be provided, when the transportation is entirely within this state, except for transportation provided by an ambulance service, by a transit bus, as defined in section 5735.01 of the Revised Code, and transportation provided by a citizen of the United States holding a certificate of public convenience and necessity issued under 49 U.S.C. 41102;

(t)(s) On and after August 1, 2003, motor vehicle towing service is or is to be provided. As used in this division, "motor vehicle towing service" means the towing or conveyance of a wrecked, disabled, or illegally parked motor vehicle.

(u)(t) On and after August 1, 2003, snow removal service is or is to be provided. As used in this division, "snow removal service" means the removal of snow by any mechanized means, but does not include the providing of such service by a person that has less than five thousand dollars in sales of such service during the calendar year.

(4) All transactions by which printed, imprinted,overprinted, lithographic, multilithic, blueprinted, photostatic,or other productions or reproductions of written or graphicmatterare or are to be furnished or transferred;

(5) The production or fabrication of tangible personalproperty for a consideration for consumers who furnish eitherdirectly or indirectly the materials used in the production offabrication work; and include the furnishing, preparing, orserving for a consideration of any tangible personal propertyconsumed on the premises of the person furnishing, preparing, orserving such tangible personal property. Except as provided insection 5739.03 of the Revised Code, a construction contractpursuant to which tangible personal property is or is to beincorporated into a structure or improvement on and becoming apart of real property is not a sale of such tangible personalproperty. The construction contractor is the consumer of suchtangible personal property, provided that the sale andinstallation of carpeting, the sale and installation ofagricultural land tile, the sale and erection or installation ofportable grain bins, or the provision of landscaping and lawncareservice and the transfer of property as part of such serviceisnever a construction contract.

As used in division (B)(5) of this section:

(a) "Agricultural land tile" means fired clay or concretetile, or flexible or rigid perforated plastic pipe or tubing,incorporated or to be incorporated into a subsurface drainagesystem appurtenant to land used or to be used directly inproduction by farming, agriculture, horticulture, orfloriculture.The term does not include such materials when theyare or are tobe incorporated into a drainage system appurtenantto a buildingor structure even if the building or structure isused or to beused in such production.

(b) "Portable grain bin" means a structure that is used orto be used by a person engaged in farming or agriculture toshelter the person's grain and that is designed to bedisassembledwithout significant damage to its component parts.

(6) All transactions in which all of the shares of stockofa closely held corporation are transferred, if the corporationisnot engaging in business and its entire assets consist ofboats,planes, motor vehicles, or other tangible personalpropertyoperated primarily for the use and enjoyment of theshareholders;

(7) All transactions in which a warranty, maintenance orservice contract, or similar agreement by which the vendor of thewarranty, contract, or agreement agrees to repair or maintain thetangible personal property of the consumer is or is to beprovided;

(8) ; (9) The transfer of copyrighted motion picture films used solely for advertising purposes, except that the transfer of such films for exhibition purposes is not a sale.

(9) On and after August 1, 2003, all transactions by which tangible personal property is or is to be stored, except such property that the consumer of the storage holds for sale in the regular course of business.

Except Other than as provided in this section, "sale" and "selling" do not include transfers of interest in leased property where the original lessee and the terms of the original lease agreement remain unchanged, or professional, insurance, or personal service transactions that involve the transfer of tangible personal property as an inconsequential element, for which no separate charges are made.

(C) "Vendor" means the person providing the service or bywhom the transfer effected or license given by a sale is or is tobe made or given and, for sales described in division (B)(3)(i)ofthis section, the telecommunications service vendor thatprovidesthe nine hundred telephone service; if two or morepersons areengaged in business at the same place of businessunder a singletrade name in which all collections on account ofsales by eachare made, such persons shall constitute a singlevendor.

Physicians, dentists, hospitals, and veterinarians who areengaged in selling tangible personal property as received fromothers, such as eyeglasses, mouthwashes, dentifrices, or similararticles, are vendors. Veterinarians who are engaged intransferring to others for a consideration drugs, the dispensingof which does not require an order of a licensed veterinarian orphysician under federal law, are vendors.

(D)(1) "Consumer" means the person for whom the service isprovided, to whom the transfer effected or license given by asaleis or is to be made or given, to whom the service describedindivision (B)(3)(f) or (i) of this section is charged, or towhomthe admission is granted.

(2) Physicians, dentists, hospitals, and blood banksoperated by nonprofit institutions and persons licensed topractice veterinary medicine, surgery, and dentistry areconsumersof all tangible personal property and servicespurchased by themin connection with the practice of medicine,dentistry, therendition of hospital or blood bank service, orthe practice ofveterinary medicine, surgery, and dentistry. Inaddition to beingconsumers of drugs administered by them or bytheir assistantsaccording to their direction, veterinarians alsoare consumers ofdrugs that under federal law may be dispensedonly by or upon theorder of a licensed veterinarian orphysician, when transferred bythem to others for a considerationto provide treatment to animalsas directed by the veterinarian.

(3) A person who performs a facility management, orsimilarservice contract for a contractee is a consumer of alltangiblepersonal property and services purchased for use inconnectionwith the performance of such contract, regardless ofwhether titleto any such property vests in the contractee. Thepurchase ofsuch property and services is not subject to theexception forresale under division (E)(1) of this section.

(4)(a) In the case of a person who purchases printedmatterfor the purpose of distributing it or having it distributed to thepublic or to a designated segment of the public, free of charge,that personis the consumer of that printed matter, and thepurchase of that printedmatter for that purpose is a sale.

(b) In the case of a person who produces, rather thanpurchases, printed matter for the purpose of distributing it orhaving itdistributed to the public or to a designated segment ofthe public, free ofcharge, that person is the consumer of alltangible personal property andservices purchased for use orconsumption in the production of that printedmatter. That personis not entitled to claim exemption under division(B)(43)(42)(f) of section 5739.02 of the Revised Code for any material incorporated into the printedmatter orany equipment, supplies, or services primarily used to produce theprinted matter.

(c) The distribution ofprinted matter to the public or to adesignated segment of the public, free ofcharge, is not a sale tothe members of the public to whom the printed matterisdistributed or to any persons who purchase space in the printedmatter foradvertising or other purposes.

(5) A person who makes sales of any of the services listedindivision (B)(3) of this section is the consumer of any tangiblepersonal property used in performing the service. The purchase ofthatproperty is not subject to the resale exception underdivision (E)(1)of this section.

(6) A person who engages in highway transportation for hire is the consumer of all packaging materials purchased by that person and used in performing the service, except for packaging materials sold by such person in a transaction separate from the service.

(E) "Retail sale" and "sales at retail" include all sales,except those in which the purpose of the consumer is to resell the thing transferred or benefit of theservice provided, by a person engaging in business, in the forminwhich the same is, or is to be, received by the person.

(F) "Business" includes any activity engaged in by anyperson with the object of gain, benefit, or advantage, eitherdirect or indirect. "Business" does not include the activity ofaperson in managing and investing the person's own funds.

(G) "Engaging in business" means commencing, conducting,orcontinuing in business, and liquidating a business when theliquidator thereof holdsitself out to the public asconductingsuch business. Making a casual sale is not engaging inbusiness.

(H)(1)(a) "Price," except as provided in divisions (H)(2) and(3) of this section, means the total amount of consideration, including cash, credit, property, and services, for which tangible personal property or services are sold, leased, or rented, valued in money, whether received in money or otherwise, without any deduction for any of the following:

(i) The vendor's cost of the property sold;

(ii) The cost of materials used, labor or service costs, interest, losses, all costs of transportation to the vendor, all taxes imposed on the vendor, including the tax imposed under Chapter 5751. of the Revised Code, and any other expense of the vendor;

(iii) Charges by the vendor for any services necessary to complete the sale;

(iv) On and after August 1, 2003, delivery charges. As used in this division, "delivery charges" means charges by the vendor for preparation and delivery to a location designated by the consumer of tangible personal property or a service, including transportation, shipping, postage, handling, crating, and packing.

(v) Installation charges;

(vi) The value of exempt tangible personal property given to the consumer where taxable and exempt tangible personal property have been bundled together and sold by the vendor as a single product or piece of merchandise Credit for any trade-in.

(b) "Price" includes consideration received by the vendor from a third party, if the vendor actually receives the consideration from a party other than the consumer, and the consideration is directly related to a price reduction or discount on the sale; the vendor has an obligation to pass the price reduction or discount through to the consumer; the amount of the consideration attributable to the sale is fixed and determinable by the vendor at the time of the sale of the item to the consumer; and one of the following criteria is met:

(i) The consumer presents a coupon, certificate, or other document to the vendor to claim a price reduction or discount where the coupon, certificate, or document is authorized, distributed, or granted by a third party with the understanding that the third party will reimburse any vendor to whom the coupon, certificate, or document is presented;

(ii) The consumer identifies the consumer's self to the seller as a member of a group or organization entitled to a price reduction or discount. A preferred customer card that is available to any patron does not constitute membership in such a group or organization.

(iii) The price reduction or discount is identified as a third party price reduction or discount on the invoice received by the consumer, or on a coupon, certificate, or other document presented by the consumer.

(c) "Price" does not include any of the following:

(i) Discounts, including cash, term, or coupons that are not reimbursed by a third party that are allowed by a vendor and taken by a consumer on a sale;

(ii) Interest, financing, and carrying charges from credit extended on the sale of tangible personal property or services, if the amount is separately stated on the invoice, bill of sale, or similar document given to the purchaser;

(iii) Any taxes legally imposed directly on the consumer that are separately stated on the invoice, bill of sale, or similar document given to the consumer. For the purpose of this division, the tax imposed under Chapter 5751. of the Revised Code is not a tax directly on the consumer, even if the tax or a portion thereof is separately stated.

(iv) Notwithstanding divisions (H)(1)(b)(i) to (iii) of this section, any discount allowed by an automobile manufacturer to its employee, or to the employee of a supplier, on the purchase of a new motor vehicle from a new motor vehicle dealer in this state.

(2) In the case of a sale of any new motor vehicle by anewmotor vehicle dealer, as defined in section 4517.01 of theRevisedCode, in which another motor vehicle is accepted by thedealer aspart of the consideration received, "price" has thesame meaningas in division (H)(1) of this section, reduced bythe creditafforded the consumer by the dealer for the motorvehicle receivedin trade.

(3) In the case of a sale of any watercraft or outboardmotor by a watercraft dealer licensed in accordance with section1547.543 of the Revised Code, in which another watercraft,watercraft and trailer, or outboard motor is accepted by thedealer as part of the consideration received, "price" has thesamemeaning as in division (H)(1) of this section, reduced bythecredit afforded the consumer by the dealer for thewatercraft,watercraft and trailer, or outboard motor received intrade. As used in this division, "watercraft" includes an outdrive unit attached to the watercraft.

(I) "Receipts" means the total amount of the prices of thesales of vendors, provided that cash discounts allowed and takenon sales at the time they are consummated are not included, minusany amount deducted as a bad debt pursuant to section 5739.121 ofthe Revised Code. "Receipts" does not include the sale price ofproperty returned or services rejected by consumers when the fullsale price and tax are refunded either in cash or by credit.

(J) "Place of business" means any location at which apersonengages in business.

(K) "Premises" includes any real property or portionthereofupon which any person engages in selling tangiblepersonalproperty at retail or making retail sales and alsoincludes anyreal property or portion thereof designated for, ordevoted to,use in conjunction with the business engaged in bysuch person.

(L) "Casual sale" means a sale of an item of tangiblepersonal propertythat was obtained by the person making thesale, through purchase or otherwise, for the person's own use andwas previously subject to any state's taxingjurisdiction on itssale or use, and includes such items acquiredfor the seller's usethat are sold by an auctioneer employeddirectly by the person forsuch purpose, provided the location ofsuch sales is not theauctioneer's permanent place of business.Asused in thisdivision, "permanent place of business" includesanylocationwhere such auctioneer has conducted more than twoauctions duringthe year.

(M) "Hotel" means every establishment kept, used,maintained, advertised, or held out to the public to be a placewhere sleeping accommodations are offered to guests, in whichfiveor more rooms areused for the accommodation of such guests,whetherthe roomsare in one or several structures.

(N) "Transient guests" means persons occupying a room orrooms for sleeping accommodations for less than thirtyconsecutivedays.

(O) "Making retail sales" means the effecting oftransactions wherein one party is obligated to pay the price andthe other party is obligated to provide a service or to transfertitle to or possession of the item sold. "Making retail sales"does not include the preliminary acts of promoting or solicitingthe retail sales, other than the distribution of printed matterwhich displays or describes and prices the item offered for sale,nor does it include delivery of a predetermined quantity oftangible personal property or transportation of property orpersonnel to or from a place where a service is performed,regardless of whether the vendor is a delivery vendor.

(P) "Used directly in the rendition of a public utilityservice" means that property that is to be incorporated into andwill become a part of the consumer's production, transmission,transportation, or distribution system andthat retains itsclassification as tangible personal property after suchincorporation; fuel or power used in the production,transmission,transportation, or distribution system; andtangible personalproperty used in the repair and maintenance ofthe production,transmission, transportation, or distributionsystem, includingonly such motor vehicles as are speciallydesigned and equippedfor such use. Tangible personal propertyand services usedprimarily in providing highway transportationfor hire are notused directly in the rendition of a public utility service.

(Q) "Refining" means removing or separating a desirableproduct from raw or contaminated materials by distillation orphysical, mechanical, or chemical processes.

(R) "Assembly" and "assembling" mean attaching or fittingtogether parts to form a product, but do not include packaging aproduct.

(S) "Manufacturing operation" means a process in whichmaterials are changed, converted, or transformed into a differentstate or form from which they previously existed and includesrefining materials, assembling parts, and preparing raw materialsand parts by mixing, measuring, blending, or otherwise committingsuch materials or parts to the manufacturing process."Manufacturing operation" does not include packaging.

(T) "Fiscal officer" means, with respect to a regionaltransit authority, the secretary-treasurer thereof, and withrespect to a countythat is a transit authority, the fiscalofficer of the county transit board if one is appointed pursuanttosection 306.03 of the Revised Code or the county auditor if theboard ofcounty commissioners operates the county transit system.

(U) "Transit authority" means a regional transit authoritycreated pursuant to section 306.31 of the Revised Code or acountyin which a county transit system is created pursuant tosection306.01 of the Revised Code. For the purposes of thischapter, atransit authority must extend to at least the entirearea of asingle county. A transit authoritythat includesterritoryinmore than one county must include all the area ofthe mostpopulous countythat is a part of such transitauthority.Countypopulation shall be measured by the mostrecent censustaken bythe United States census bureau.

(V) "Legislative authority" means, with respect to aregional transit authority, the board of trustees thereof, andwith respect to a countythat is a transit authority, theboardof county commissioners.

(W) "Territory of the transit authority" means all of thearea included within the territorial boundaries of a transitauthority as they from time to time exist. Such territorialboundaries must at all times include all the area of a singlecounty or all the area of the most populous countythat is apartof such transit authority. County population shall bemeasured bythe most recent census taken by the United Statescensus bureau.

(X) "Providing a service" means providing or furnishinganything described in division (B)(3) of this section forconsideration.

(Y)(1)(a) "Automatic data processing" means processing ofothers' data, including keypunching or similar data entryservicestogether with verification thereof, or providing accesstocomputer equipment for the purpose of processing data.

(b) "Computer services" means providing servicesconsistingof specifying computer hardware configurations andevaluatingtechnical processing characteristics, computerprogramming, andtraining of computer programmers and operators,provided inconjunction with and to support the sale, lease, oroperation oftaxable computer equipment or systems.

(c) "Electronic information services" means providingaccessto computer equipment by means of telecommunicationsequipment forthe purpose of either of the following:

(i) Examining or acquiring data stored in or accessible tothe computer equipment;

(ii) Placing data into the computer equipment to beretrieved by designated recipients with access to the computerequipment.

(d) "Automatic data processing, computer services, orelectronic information services" shall not include personal orprofessional services.

(2) As used in divisions (B)(3)(e) and (Y)(1) of thissection, "personal and professional services" means all servicesother than automatic data processing, computer services, orelectronic information services, including but not limited to:

(a) Accounting and legal services such as advice on taxmatters, asset management, budgetary matters, quality control,information security, and auditing and any other situation wherethe service provider receives data or information and studies,alters, analyzes, interprets, or adjusts such material;

(b) Analyzing business policies and procedures;

(c) Identifying management information needs;

(d) Feasibility studies, including economic and technicalanalysis of existing or potential computer hardware or softwareneeds and alternatives;

(e) Designing policies, procedures, and custom softwareforcollecting business information, and determining how datashouldbe summarized, sequenced, formatted, processed, controlled,andreported so that it will be meaningful to management;

(f) Developing policies and procedures that document howbusiness events and transactions are to be authorized, executed,and controlled;

(g) Testing of business procedures;

(h) Training personnel in business procedure applications;

(i) Providing credit information to users of suchinformation by a consumer reporting agency, as defined in the"Fair Credit Reporting Act," 84 Stat. 1114, 1129 (1970), 15U.S.C.1681a(f), or as hereafter amended, including but notlimited togathering, organizing, analyzing, recording, andfurnishing suchinformation by any oral, written, graphic, orelectronic medium;

(j) Providing debt collection services by any oral,written,graphic, or electronic means.

The services listed in divisions (Y)(2)(a) to (j) of thissection are not automatic data processing or computer services.

(Z) "Highway transportation for hire" means thetransportation of personal property belonging to others forconsideration by any of the following:

(1) The holder of a permit or certificate issued by thisstate or the United States authorizing the holder to engage intransportation of personal property belonging to others forconsideration over or on highways, roadways, streets, or anysimilar public thoroughfare;

(2) A person who engages in the transportation of personalproperty belonging to others for consideration over or onhighways, roadways, streets, or any similar public thoroughfarebut who could not have engaged in such transportation on December11, 1985, unless the person was the holder of a permit orcertificate of the types described in division (Z)(1) of thissection;

(3) A person who leases a motor vehicle to and operates itfor a person described by division (Z)(1) or (2) of this section.

(AA)(1) "Telecommunications service" means the transmissionofany interactive, two-way electromagnetic communications,includingvoice, image, data, and information, through the use ofany mediumsuch as wires, cables, microwaves, cellular radio,radio waves,light waves, or any combination of those or similarmedia."Telecommunications service" includes message tollservice eventhough the vendor provides the message toll serviceby means ofwide area transmission type service or privatecommunicationsservice purchased from another telecommunicationsserviceprovider, and other related fees and ancillary services, including universal service fees, detailed billing service, directory assistance, service initiation, voice mail service, and vertical services, such as caller ID and three-way calling electronic transmission, conveyance, or routing of voice, data, audio, video, or any other information or signals to a point, or between or among points. "Telecommunications service" includes such transmission, conveyance, or routing in which computer processing applications are used to act on the form, code, or protocol of the content for purposes of transmission, conveyance, or routing without regard to whether the service is referred to as voice-over internet protocol service or is classified by the federal communications commission as enhanced or value-added. "Telecommunications service" does not include any of the following:

(1) Sales of telecommunications service billed to persons before January 1, 2004, by telephone companiessubjectto the excise tax imposed by Chapter 5727. of the RevisedCode;

(2) Sales of telecommunications service to a provider oftelecommunications service or of mobile telecommunications service, including access services, for use inproviding telecommunications service or mobile telecommunications service;

(3) Value-added nonvoice services in which computerprocessing applications are used to act on the form, content,code, or protocol of the information to be transmitted;

(4) Transmission of interactive video programming by acabletelevision system as defined in section 505.90 of theRevisedCode;

(5) After July 31, 2002, mobile telecommunications service (a) Data processing and information services that allow data to be generated, acquired, stored, processed, or retrieved and delivered by an electronic transmission to a consumer where the consumer's primary purpose for the underlying transaction is the processed data or information;

(b) Installation or maintenance of wiring or equipment on a customer's premises;

(c) Tangible personal property;

(d) Advertising, including directory advertising;

(e) Billing and collection services provided to third parties;

(f) Internet access service;

(g) Radio and television audio and video programming services, regardless of the medium, including the furnishing of transmission, conveyance, and routing of such services by the programming service provider. Radio and television audio and video programming services include, but are not limited to, cable service, as defined in 47 U.S.C. 522(6), and audio and video programming services delivered by commercial mobile radio service providers, as defined in 47 C.F.R. 20.3;

(h) Ancillary service;

(i) Digital products delivered electronically, including software, music, video, reading materials, or ring tones.

(2) "Ancillary service" means a service that is associated with or incidental to the provision of telecommunications service, including conference bridging service, detailed telecommunications billing service, directory assistance, vertical service, and voice mail service. As used in this division:

(a) "Conference bridging service" means an ancillary service that links two or more participants of an audio or video conference call, including providing a telephone number. "Conference bridging service" does not include telecommunications services used to reach the conference bridge.

(b) "Detailed telecommunications billing service" means an ancillary service of separately stating information pertaining to individual calls on a customer's billing statement.

(c) "Directory assistance" means an ancillary service of providing telephone number or address information.

(d) "Vertical service" means an ancillary service that is offered in connection with one or more telecommunications services, which offers advanced calling features that allow customers to identify callers and manage multiple calls and call connections, including conference bridging service.

(e) "Voice mail service" means an ancillary service that enables the customer to store, send, or receive recorded messages. "Voice mail service" does not include any vertical services that the customer may be required to have in order to utilize the voice mail service.

(3) "900 service" means an inbound toll telecommunications service purchased by a subscriber that allows the subscriber's customers to call in to the subscriber's prerecorded announcement or live service, and which is typically marketed under the name "900" service and any subsequent numbers designated by the federal communications commission. "900 service" does not include the charge for collection services provided by the seller of the telecommunications service to the subscriber, or services or products sold by the subscriber to the subscriber's customer.

(4) "Prepaid calling service" means the right to access exclusively telecommunications services, which must be paid for in advance and which enables the origination of calls using an access number or authorization code, whether manually or electronically dialed, and that is sold in predetermined units of dollars of which the number declines with use in a known amount.

(5) "Prepaid wireless calling service" means a telecommunications service that provides the right to utilize mobile telecommunications service as well as other non-telecommunications services, including the download of digital products delivered electronically, and content and ancillary services, that must be paid for in advance and that is sold in predetermined units of dollars of which the number declines with use in a known amount.

(6) "Value-added non-voice data service" means a telecommunications service in which computer processing applications are used to act on the form, content, code, or protocol of the information or data primarily for a purpose other than transmission, conveyance, or routing.

(7) "Coin-operated telephone service" means a telecommunications service paid for by inserting money into a telephone accepting direct deposits of money to operate.

(8) "Customer" has the same meaning as in section 5739.034 of the Revised Code.

(BB) "Laundry and dry cleaning services" means removingsoil or dirt from towels, linens, articles ofclothing, or other fabric items that belong to others and supplying towels, linens, articles of clothing, or other fabric items. "Laundry and dry cleaning services" does not include the provision of self-service facilities for use by consumers to remove soil or dirt from towels, linens, articles of clothing, or other fabric items.

(CC) "Magazines distributed as controlled circulationpublications" means magazines containing at least twenty-fourpages, at least twenty-five per cent editorial content, issued atregular intervals four or more times a year, and circulatedwithout charge to the recipient, provided that such magazines arenot owned or controlled by individuals or business concerns whichconduct such publications as an auxiliary to, and essentially forthe advancement of the main business or calling of, those who ownor control them.

(DD) "Landscaping and lawn care service" means theservicesof planting, seeding, sodding, removing, cutting,trimming,pruning, mulching, aerating, applying chemicals,watering,fertilizing, and providing similar services toestablish, promote,or control the growth of trees, shrubs,flowers, grass, groundcover, and other flora, or otherwisemaintaining a lawn orlandscape grown or maintained by the ownerfor ornamentation orother nonagricultural purpose. However,"landscaping and lawncare service" does not include theproviding of such services by aperson who has less than fivethousand dollars in sales of suchservices during the calendaryear.

(EE) "Private investigation and security service" meanstheperformance of any activity for which the provider of suchserviceis required to be licensed pursuant to Chapter 4749. oftheRevised Code, or would be required to be so licensed inperformingsuch services in this state, and also includes theservices ofconducting polygraph examinations and of monitoringor overseeingthe activities on or in, or the condition of, theconsumer's home,business, or other facility by means ofelectronic or similarmonitoring devices. "Private investigationand security service"does not include special duty servicesprovided by off-duty policeofficers, deputy sheriffs, and otherpeace officers regularlyemployed by the state or a politicalsubdivision.

(FF) "Information services" means providing conversation,giving consultation or advice, playing or making a voice or otherrecording, making or keeping a record of the number of callers,and any other service provided to a consumer by means of a ninehundred telephone call, except when the nine hundred telephonecall is the means by which the consumer makes a contribution to arecognized charity.

(GG) "Research and development" means designing, creating,or formulating new or enhanced products, equipment, ormanufacturing processes, and also means conducting scientific ortechnological inquiry and experimentation in the physicalscienceswith the goal of increasing scientific knowledge whichmay revealthe bases for new or enhanced products, equipment, ormanufacturing processes.

(HH) "Qualified research and development equipment" meanscapitalized tangible personal property, and leased personalproperty that would be capitalized if purchased, used by a personprimarily to perform research and development. Tangible personalproperty primarily used in testing, as defined in division (A)(4)of section 5739.011 of the Revised Code, or used for recording orstoring test results, is not qualified research and developmentequipment unless such property is primarily used by the consumerin testing the product, equipment, or manufacturing process beingcreated, designed, or formulated by the consumer in the researchand development activity or in recording or storing such testresults.

(II) "Building maintenance and janitorial service" meanscleaning the interior or exterior of a building and any tangiblepersonal property located therein or thereon, including anyservices incidental to such cleaning for which no separate chargeis made. However, "building maintenance and janitorial service"does not include the providing of such service by a person whohasless than five thousand dollars in sales of such serviceduringthe calendar year.

(JJ) "Employment service" means providing or supplyingpersonnel, on a temporary or long-term basis, to perform work orlabor under the supervision or control of another, when thepersonnel so supplied receive their wages, salary, or othercompensation from the provider of the service. "Employmentservice" does not include:

(1) Acting as a contractor or subcontractor, where thepersonnel performing the work are not under the direct control ofthe purchaser.

(2) Medical and health care services.

(3) Supplying personnel to a purchaser pursuant to acontract of at least one year between the service provider andthepurchaser that specifies that each employee covered under thecontract is assigned to the purchaser on a permanent basis.

(4) Transactions between members of an affiliated group,asdefined in division (B)(3)(e) of this section.

(KK) "Employment placement service" means locating orfinding employment for a person or finding or locating anemployeeto fill an available position.

(LL) "Exterminating service" means eradicating orattemptingto eradicate vermin infestations from a building orstructure, orthe area surrounding a building or structure, andincludesactivities to inspect, detect, or prevent vermininfestation of abuilding or structure.

(MM) "Physical fitness facility service" means alltransactions by which a membership is granted, maintained, orrenewed, including initiation fees, membership dues, renewalfees,monthly minimum fees, and other similar fees and dues, by aphysical fitness facility such as an athletic club, health spa,orgymnasium, which entitles the member to use the facility forphysical exercise.

(NN) "Recreation and sports club service" means alltransactions by which a membership is granted, maintained, orrenewed, including initiation fees, membership dues, renewalfees,monthly minimum fees, and other similar fees and dues, by arecreation and sports club, which entitles the member to use thefacilities of the organization. "Recreation and sports club"means an organization that has ownership of, or controls orleaseson a continuing, long-term basis, the facilities used byitsmembers and includes an aviation club, gun or shooting club,yachtclub, card club, swimming club, tennis club, golf club,countryclub, riding club, amateur sports club, or similarorganization.

(OO) "Livestock" means farm animals commonly raised forfoodor food production, and includes but is not limited tocattle,sheep, goats, swine, and poultry. "Livestock" does notincludeinvertebrates, fish, amphibians, reptiles, horses,domestic pets,animals for use in laboratories or for exhibition,or otheranimals not commonly raised for food or food production.

(PP) "Livestock structure" means a building or structureused exclusively for the housing, raising, feeding, or shelteringof livestock, and includes feed storage or handling structuresandstructures for livestock waste handling.

(QQ) "Horticulture" means the growing, cultivation, andproduction of flowers, fruits, herbs, vegetables, sod, mushrooms,and nursery stock. As used in this division, "nursery stock" hasthe same meaning as in section 927.51 of the Revised Code.

(RR) "Horticulture structure" means a building orstructureused exclusively for the commercial growing, raising,oroverwintering of horticultural products, and includes the areaused for stocking, storing, and packing horticultural productswhen done in conjunction with the production of those products.

(SS) "Newspaper" means an unbound publication bearing atitle orname that is regularly published, at least as frequentlyas biweekly, anddistributed from a fixed place of business to thepublic in a specificgeographic area, and that contains asubstantial amount of news matter ofinternational, national, orlocal events of interest to the general public.

(TT) "Professionalracing team" means a person that employsat least twentyfull-time employees for the purpose of conductinga motorvehicle racing business for profit. The person mustconduct thebusiness with the purpose of racing one or more motorracingvehicles in at least ten competitive professional racingeventseach year that comprise all or part of a motor racingseriessanctioned by one or more motor racing sanctioningorganizations. A "motor racing vehicle" means a vehicle forwhichthe chassis, engine, and parts are designedexclusively for motorracing, and does not include a stockor production model vehiclethat may be modified for use inracing. For the purposes of thisdivision:

(1) A "competitive professional racing event" is a motorvehicle racing event sanctioned by one or more motor racingsanctioning organizations, at which aggregate cash prizes inexcess of eight hundred thousand dollars are awarded tothecompetitors.

(2) "Full-time employee" means an individual who isemployedfor consideration for thirty-five or more hours a week,or whorenders any other standard of service generally acceptedby customor specified by contract as full-timeemployment.

(UU)(1) "Lease" or "rental" means any transfer of thepossession or control of tangiblepersonal property for a fixed or indefinite term, for consideration. "Lease" or "rental" includes future options to purchase or extend, and agreements described in 26 U.S.C. 7701(h)(1) covering motor vehicles and trailers where the amount of consideration may be increased or decreased by reference to the amount realized upon the sale or disposition of the property. "Lease" or "rental" does not include:

(a) A transfer of possession or control of tangible personal property under a security agreement or a deferred payment plan that requires the transfer of title upon completion of the required payments;

(b) A transfer of possession or control of tangible personal property under an agreement that requires the transfer of title upon completion of required payments and payment of an option price that does not exceed the greater of one hundred dollars or one per cent of the total required payments;

(c) Providing tangible personal property along with an operator for a fixed or indefinite period of time, if the operator is necessary for the property to perform as designed. For purposes of this division, the operator must do more than maintain, inspect, or set-up the tangible personal property.

(2) "Lease" and "rental," as defined in division (UU) of this section, shall not apply to leases or rentals that exist before the effective date of this amendment June 26, 2003.

(3) "Lease" and "rental" have the same meaning as in division (UU)(1) of this section regardless of whether a transaction is characterized as a lease or rental under generally accepted accounting principles, the Internal Revenue Code, Title XIII of the Revised Code, or other federal, state, or local laws.

(VV) "Mobile telecommunications service" has the samemeaning as in the "Mobile Telecommunications Sourcing Act," Pub.L.No. 106-252, 114 Stat. 631 (2000), 4 U.S.C.A. 124(7), asamended, and, on and after August 1, 2003, includes related fees and ancillary services, including universal service fees, detailed billing service, directory assistance, service initiation, voice mail service, and vertical services, such as caller ID and three-way calling.

(WW) "Certified service provider" has the same meaning as insection 5740.01 of the Revised Code.

(XX) "Satellite broadcasting service" means the distribution or broadcasting of programming or services by satellite directly to the subscriber's receiving equipment without the use of ground receiving or distribution equipment, except the subscriber's receiving equipment or equipment used in the uplink process to the satellite, and includes all service and rental charges, premium channels or other special services, installation and repair service charges, and any other charges having any connection with the provision of the satellite broadcasting service.

(YY) "Tangible personal property" means personal property that can be seen, weighed, measured, felt, or touched, or that is in any other manner perceptible to the senses. For purposes of this chapter and Chapter 5741. of the Revised Code, "tangible personal property" includes motor vehicles, electricity, water, gas, steam, and prewritten computer software.

(ZZ) "Direct mail" means printed material delivered or distributed by United States mail or other delivery service to a mass audience or to addressees on a mailing list provided by the consumer or at the direction of the consumer when the cost of the items are not billed directly to the recipients. "Direct mail" includes tangible personal property supplied directly or indirectly by the consumer to the direct mail vendor for inclusion in the package containing the printed material. "Direct mail" does not include multiple items of printed material delivered to a single address.

(AAA) "Computer" means an electronic device that accepts information in digital or similar form and manipulates it for a result based on a sequence of instructions.

(BBB) "Computer software" means a set of coded instructions designed to cause a computer or automatic data processing equipment to perform a task.

(CCC) "Delivered electronically" means delivery of computer software from the seller to the purchaser by means other than tangible storage media.

(DDD) "Prewritten computer software" means computer software, including prewritten upgrades, that is not designed and developed by the author or other creator to the specifications of a specific purchaser. The combining of two or more prewritten computer software programs or prewritten portions thereof does not cause the combination to be other than prewritten computer software. "Prewritten computer software" includes software designed and developed by the author or other creator to the specifications of a specific purchaser when it is sold to a person other than the purchaser. If a person modifies or enhances computer software of which the person is not the author or creator, the person shall be deemed to be the author or creator only of such person's modifications or enhancements. Prewritten computer software or a prewritten portion thereof that is modified or enhanced to any degree, where such modification or enhancement is designed and developed to the specifications of a specific purchaser, remains prewritten computer software; provided, however, that where there is a reasonable, separately stated charge or an invoice or other statement of the price given to the purchaser for the modification or enhancement, the modification or enhancement shall not constitute prewritten computer software.

(EEE)(1) Prior to July 1, 2004, "food" means cereals and cereal products, milk and milk products including ice cream, meat and meat products, fish and fish products, eggs and egg products, vegetables and vegetable products, fruits, fruit products, and pure fruit juices, condiments, sugar and sugar products, coffee and coffee substitutes, tea, and cocoa and cocoa products. "Food" does not include spirituous liquors, wine, mixed beverages, or beer; soft drinks; sodas and beverages that are ordinarily dispensed at or in connection with bars and soda fountains, other than coffee, tea, and cocoa; root beer and root beer extracts; malt and malt extracts; mineral oils, cod liver oils, and halibut liver oil; medicines, including tonics, vitamin preparations, and other products sold primarily for their medicinal properties; and water, including mineral, bottled, and carbonated waters, and ice.

(2) On and after July 1, 2004, "food "Food"means substances, whether in liquid, concentrated, solid, frozen, dried, or dehydrated form, that are sold for ingestion or chewing by humans and are consumed for their taste or nutritional value. "Food" does not include alcoholic beverages, dietary supplements, soft drinks, or tobacco.

(3)(2) As used in division (EEE)(2)(1) of this section:

(a) "Alcoholic beverages" means beverages that are suitable for human consumption and contain one-half of one per cent or more of alcohol by volume.

(b) "Dietary supplements" means any product, other than tobacco, that is intended to supplement the diet and that is intended for ingestion in tablet, capsule, powder, softgel, gelcap, or liquid form, or, if not intended for ingestion in such a form, is not represented as conventional food for use as a sole item of a meal or of the diet; that is required to be labeled as a dietary supplement, identifiable by the "supplement facts" box found on the label, as required by 21 C.F.R. 101.36; and that contains one or more of the following dietary ingredients:

(i) A vitamin;

(ii) A mineral;

(iii) An herb or other botanical;

(iv) An amino acid;

(v) A dietary substance for use by humans to supplement the diet by increasing the total dietary intake;

(vi) A concentrate, metabolite, constituent, extract, or combination of any ingredient described in divisions (EEE)(3)(2)(b)(i) to (v) of this section.

(c) "Soft drinks" means nonalcoholic beverages that contain natural or artificial sweeteners. "Soft drinks" does not include beverages that contain milk or milk products, soy, rice, or similar milk substitutes, or that contains greater than fifty per cent vegetable or fruit juice by volume.

(d) "Tobacco" means cigarettes, cigars, chewing or pipe tobacco, or any other item that contains tobacco.

(FFF) "Drug" means a compound, substance, or preparation, and any component of a compound, substance, or preparation, other than food, dietary supplements, or alcoholic beverages that is recognized in the official United States pharmacopoeia, official homeopathic pharmacopoeia of the United States, or official national formulary, and supplements to them; is intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease; or is intended to affect the structure or any function of the body.

(GGG) "Prescription" means an order, formula, or recipe issued in any form of oral, written, electronic, or other means of transmission by a duly licensed practitioner authorized by the laws of this state to issue a prescription.

(HHH) "Durable medical equipment" means equipment, including repair and replacement parts for such equipment, that can withstand repeated use, is primarily and customarily used to serve a medical purpose, generally is not useful to a person in the absence of illness or injury, and is not worn in or on the body. "Durable medical equipment" does not include mobility enhancing equipment.

(III) "Mobility enhancing equipment" means equipment, including repair and replacement parts for such equipment, that is primarily and customarily used to provide or increase the ability to move from one place to another and is appropriate for use either in a home or a motor vehicle, that is not generally used by persons with normal mobility, and that does not include any motor vehicle or equipment on a motor vehicle normally provided by a motor vehicle manufacturer. "Mobility enhancing equipment" does not include durable medical equipment.

(JJJ) "Prosthetic device" means a replacement, corrective, or supportive device, including repair and replacement parts for the device, worn on or in the human body to artificially replace a missing portion of the body, prevent or correct physical deformity or malfunction, or support a weak or deformed portion of the body. As used in this division, "prosthetic device" does not include corrective eyeglasses, contact lenses, or dental prosthesis.

(KKK)(1) "Fractional aircraft ownership program" means a program in which persons within an affiliated group sell and manage fractional ownership program aircraft, provided that at least one hundred airworthy aircraft are operated in the program and the program meets all of the following criteria:

(a) Management services are provided by at least one program manager within an affiliated group on behalf of the fractional owners.

(b) Each program aircraft is owned or possessed by at least one fractional owner.

(c) Each fractional owner owns or possesses at least a one-sixteenth interest in at least one fixed-wing program aircraft.

(d) A dry-lease aircraft interchange arrangement is in effect among all of the fractional owners.

(e) Multi-year program agreements are in effect regarding the fractional ownership, management services, and dry-lease aircraft interchange arrangement aspects of the program.

(2) As used in division (KKK)(1) of this section:

(a) "Affiliated group" has the same meaning as in division (B)(3)(e) of this section.

(b) "Fractional owner" means a person that owns or possesses at least a one-sixteenth interest in a program aircraft and has entered into the agreements described in division (KKK)(1)(e) of this section.

(c) "Fractional ownership program aircraft" or "program aircraft" means a turbojet aircraft that is owned or possessed by a fractional owner and that has been included in a dry-lease aircraft interchange arrangement and agreement under divisions (KKK)(1)(d) and (e) of this section, or an aircraft a program manager owns or possesses primarily for use in a fractional aircraft ownership program.

(d) "Management services" means administrative and aviation support services furnished under a fractional aircraft ownership program in accordance with a management services agreement under division (KKK)(1)(e) of this section, and offered by the program manager to the fractional owners, including, at a minimum, the establishment and implementation of safety guidelines; the coordination of the scheduling of the program aircraft and crews; program aircraft maintenance; program aircraft insurance; crew training for crews employed, furnished, or contracted by the program manager or the fractional owner; the satisfaction of record-keeping requirements; and the development and use of an operations manual and a maintenance manual for the fractional aircraft ownership program.

(e) "Program manager" means the person that offers management services to fractional owners pursuant to a management services agreement under division (KKK)(1)(e) of this section.

Sec. 5739.012.  (A) As used in this section:

(1) "Bundled transaction" means the retail sale of two or more products, except real property and services to real property, where the products are otherwise distinct and identifiable products and are sold for one non-itemized price. "Bundled transaction" does not include the sale of any products in which the sales price varies, or is negotiable, based on the selection by the consumer of the products included in the transaction.

As used in division (A)(1) of this section:

(a) "Distinct and identifiable products" does not include any of the following:

(i) Packaging, including containers, boxes, sacks, bags, and bottles, and packaging materials, including wrapping, labels, tags, and instruction guides that accompany the retail sale of the products and are incidental or immaterial to the retail sale thereof;

(ii) A product provided free of charge with the required purchase of another product. A product is provided free of charge if the sales price of the product purchased does not vary depending on the inclusion of the product provided free of charge.

(iii) Items included in the definition of "price" under division (H) of section 5739.01 of the Revised Code.

(b) "One non-itemized price" does not include a price that is separately identified by product on binding sales or other supporting sales-related documents made available to the consumer in paper or electronic form, including, but not limited to, an invoice, bill of sale, receipt, contract, service agreement, lease agreement, periodic notice of rates and services, rate card, or price list.

(2) "De minimis" means the vendor's or seller's purchase price or sales price of taxable products is ten per cent or less of the total purchase price or sales price of bundled products. Vendors and sellers shall use either the purchase price or the sales price of the products to determine if the taxable products are de minimis, and shall use the full term of a service contract to determine if the taxable products are de minimis. Vendors and sellers shall not use a combination of the purchase price and sales price of the products to determine if the taxable products are de minimis.

(3) "Over-the-counter drug" means a drug that contains a label that identifies the product as a drug as required by 21 C.F.R. 201.66, and the label includes either a "Drug Facts" panel or a statement of the active ingredients with a list of those ingredients contained in the drug.

(B) A transaction that otherwise meets the definition of a bundled transaction is not a bundled transaction if it is any of the following:

(1) A retail sale of tangible personal property and a service where the tangible personal property is essential to the use of the service, and is provided exclusively in connection with the service, and the true object of the transaction is the service;

(2) A retail sale of services where one service is provided that is essential to the use or receipt of a second service, the first service is provided exclusively in connection with the second service, and the true object of the transaction is the second service;

(3) A transaction that includes taxable products and nontaxable products, and the purchase price or sales price of the taxable products is de minimis;

(4) A retail sale of exempt tangible personal property and taxable tangible personal property where the transaction includes food and food ingredients, drugs, durable medical equipment, mobility enhancing equipment, over-the-counter drugs, prosthetic devices, or medical supplies, and the vendor's or seller's purchase price or sales price of the taxable tangible personal property is fifty per cent or less of the total purchase price or sales price of the bundled tangible personal property. Vendors and sellers may not use a combination of the purchase price and sales price of the tangible personal property when making the fifty per cent determination for a transaction.

(C) In the case of a bundled transaction that includes telecommunications service, ancillary service, internet access, or audio or video programming service:

(1) If the price is attributable to products that are taxable and products that are nontaxable, the portion of the price attributable to the nontaxable products shall be subject to tax unless the provider, by reasonable and verifiable standards, can identify the portion from its books and records that are kept in the regular course of business for other purposes, including, but not limited to, non-tax purposes.

(2) If the price is attributable to products that are subject to tax at different tax rates, the total price shall be treated as attributable to the products subject to tax at the highest tax rate unless the provider can identify by reasonable and verifiable standards the portion of the price attributable to the products subject to tax at the lower rate from its books and records that are kept in the regular course of business for other purposes, including, but not limited to, non-tax purposes.

(D) In all other cases of bundled transactions, the taxability of the transaction shall be determined by the true object of the consumer entering into the transaction.

Sec. 5739.02.  For the purpose of providing revenue withwhich to meet the needs of the state, for the use of the generalrevenuefund of the state, for the purpose of securing a thoroughandefficient system of common schools throughout the state, forthe purpose of affording revenues, in addition to those fromgeneral property taxes, permitted under constitutionallimitations, and from other sources, for the support of localgovernmental functions, and for the purpose of reimbursing thestate for the expense of administering this chapter, an excisetaxis hereby levied on each retail sale made in this state.

(A)(1) The tax shall be collected as providedinsection 5739.025 of the Revised Code, provided that on and after July 1, 2003, and on or before June 30, 2005, the rate of tax shall be six per cent. On and after July 1, 2005, the rate of the tax shall be five and one-half per cent. The tax applies and is collectible when the sale is made,regardless of the time when the price is paid or delivered.

(2) In the case of the lease or rental, with a fixed term of more than thirty days or an indefinite term with a minimum period of more than thirty days, of any motor vehicles designed by the manufacturer to carry a load of not more than one ton, watercraft, outboard motor, or aircraft, or of any tangible personal property, other than motor vehicles designed by the manufacturer to carry a load of more than one ton, to be used by the lessee or renter primarily for business purposes, the tax shall be collected by the vendor at the time the lease or rental is consummated and shall be calculated by the vendor on the basis of the total amount to be paid by the lessee or renter under the lease agreement. If the total amount of the consideration for the lease or rental includes amounts that are not calculated at the time the lease or rental is executed, the tax shall be calculated and collected by the vendor at the time such amounts are billed to the lessee or renter. In the case of an open-end lease or rental, the tax shall be calculated by the vendor on the basis of the total amount to be paid during the initial fixed term of the lease or rental, and for each subsequent renewal period as it comes due. As used in this division, "motor vehicle" has the same meaning as in section 4501.01 of the Revised Code, and "watercraft" includes an outdrive unit attached to the watercraft.

A lease with a renewal clause and a termination penalty or similar provision that applies if the renewal clause is not exercised is presumed to be a sham transaction. In such a case, the tax shall be calculated and paid on the basis of the entire length of the lease period, including any renewal periods, until the termination penalty or similar provision no longer applies. The taxpayer shall bear the burden, by a preponderance of the evidence, that the transaction or series of transactions is not a sham transaction.

(3) Except as provided in division (A)(2) of this section, in the case of a sale, the price of which consists in wholeor in part of the lease or rental of tangible personal property, thetax shall be measured by theinstallmentsof that lease or rental.

(4) In the case of a sale of a physical fitness facility service or recreation and sports club service, the price ofwhich consists in whole or in part of a membership for thereceiptof the benefit of the service, the tax applicable to thesaleshall be measured by the installments thereof.

(B) The tax does not apply to the following:

(1) Sales to the state or any of its politicalsubdivisions,or to any other state or its political subdivisionsif the laws ofthat state exempt from taxation sales made to thisstate and itspolitical subdivisions;

(2) Sales of food for human consumption off the premiseswhere sold;

(3) Sales of food sold to students only in a cafeteria,dormitory, fraternity, or sorority maintained in a private,public, or parochial school, college, or university;

(4) Sales of newspapers and of magazine subscriptions andsales or transfers of magazinesdistributed as controlledcirculation publications;

(5) The furnishing, preparing, or serving of meals withoutcharge by an employer to an employee provided the employerrecordsthe meals as part compensation for services performed orworkdone;

(6) Sales of motor fuel upon receipt, use,distribution, orsale of which in this state a tax is imposed bythe law of thisstate, but this exemption shall not apply to thesale of motorfuel on which a refund of the tax isallowable under division (A) of section5735.14 of the Revised Code; and the taxcommissioner may deductthe amount of tax levied by this sectionapplicable to the priceof motor fuel when granting arefund of motor fuel tax pursuant to division (A) ofsection 5735.14 ofthe Revised Code and shall cause the amountdeducted to be paidinto the general revenue fund of this state;

(7) Sales of natural gas by a natural gas company, of waterby a water-workscompany, or of steam by a heating company, if ineach case thething sold is delivered to consumers through pipesorconduits, and all sales of communications services by a telegraph company, all terms as defined in section5727.01 ofthe Revised Code, and sales of electricity delivered through wires;

(8) Casual sales by a person, or auctioneer employeddirectly by the person to conduct such sales, except as tosuchsales ofmotor vehicles, watercraft or outboard motors required tobetitled under section 1548.06 of the Revised Code, watercraftdocumented with the United States coast guard, snowmobiles, andall-purpose vehicles as defined in section 4519.01 of the RevisedCode;

(9) Sales of services or tangible personal property, otherthan motor vehicles, mobile homes, and manufacturedhomes, bychurches, organizations exempt from taxation undersection501(c)(3) of the Internal RevenueCode of 1986, ornonprofitorganizations operated exclusively for charitablepurposes asdefined in division (B)(12) of this section, providedthat thenumber of days on which such tangible personal propertyorservices, other than items never subject to the tax, are solddoesnot exceed six in any calendar year. If the number of daysonwhich such sales are made exceeds six in any calendar year,thechurch or organization shall be considered to be engaged inbusiness and all subsequent sales by it shall be subject to thetax. In counting the number of days, all sales by groups withinachurch or within an organization shall be considered to besalesof that church or organization, except that sales made byseparatestudent clubs and other groups of students of a primaryorsecondary school, and sales made by a parent-teacherassociation,booster group, or similar organization that raisesmoney tosupport or fund curricular or extracurricular activitiesof aprimary or secondary school, shall not be considered to besalesof such school, and sales by each such club, group,association,or organization shall be counted separately forpurposes of thesix-day limitation. This division does not applyto sales by anoncommercial educational radio or televisionbroadcastingstation.

(10) Sales not within the taxing power of this state underthe Constitution of the United States;

(11) Except for transactions that are sales under division (B)(3)(s)(r) of section 5739.01 of the Revised Code, the transportation of persons or property, unless thetransportation is by a private investigation and securityservice;

(12) Sales of tangible personal property or services tochurches, to organizations exempt from taxation under section501(c)(3) of the Internal Revenue Code of 1986, and to any othernonprofit organizations operated exclusively for charitablepurposes in this state, no part of the net income of which inuresto the benefit of any private shareholder or individual, and nosubstantial part of the activities of which consists of carryingon propaganda or otherwise attempting to influence legislation;sales to offices administering one or more homes for the aged orone or more hospital facilities exempt under section 140.08 oftheRevised Code; and sales to organizations described indivision (D)of section 5709.12 of the Revised Code.

"Charitable purposes" means the relief of poverty; theimprovement of health through the alleviation of illness,disease,or injury; the operation of an organizationexclusivelyfor theprovision of professional, laundry, printing, andpurchasingservices to hospitals or charitable institutions;theoperation ofa home for the aged, as defined in section 5701.13of the RevisedCode; the operation of a radio or televisionbroadcasting stationthat is licensed by the federalcommunications commission as anoncommercial educational radio ortelevision station; theoperation of a nonprofit animaladoption service or a countyhumane society; the promotion ofeducation by an institution oflearning that maintains a faculty ofqualified instructors,teaches regular continuous courses of study, andconfers arecognized diploma upon completion of a specificcurriculum; theoperation of a parent-teacher association,booster group, orsimilar organization primarily engaged in thepromotion andsupport of the curricular or extracurricularactivities of aprimary or secondary school; the operation of acommunity or areacenter in which presentations in music,dramatics, the arts, andrelated fields are made in order tofoster public interest andeducation therein; the production ofperformances in music,dramatics, and the arts; or thepromotion of education by anorganization engaged in carrying on researchin, or thedissemination of, scientific and technologicalknowledge andinformation primarily for the public.

Nothing in this division shall be deemed to exempt sales toany organization for use in the operation or carrying on of atrade or business, or sales to a home for the aged for use in theoperation of independent living facilities as defined in division(A) of section 5709.12 of the Revised Code.

(13) Building and construction materials and services soldto construction contractors for incorporation into a structure orimprovement to real property under a construction contract withthis state or a political subdivisionof this state, orwith theUnitedStates government or any of its agencies; buildingandconstruction materials and services sold to constructioncontractors for incorporation into a structure or improvement toreal property that are accepted for ownership by thisstate oranyof its political subdivisions, or by the United Statesgovernmentor any of its agencies at the time of completion ofthestructures or improvements; building and constructionmaterialssold to construction contractors for incorporation intoahorticulture structure or livestock structure for a personengagedin the business of horticulture or producing livestock;buildingmaterials and services sold to a construction contractorforincorporation into a house of public worship or religiouseducation, or a building used exclusively for charitable purposesunder a construction contract with an organization whose purposeis as described in division (B)(12) of this section; buildingmaterials andservices sold to a construction contractor forincorporation into a buildingunder a construction contract withan organization exempt from taxation undersection 501(c)(3) ofthe Internal RevenueCode of 1986 when the building is to be usedexclusively for theorganization's exempt purposes; building andconstruction materials sold for incorporation into the originalconstruction of a sports facility under section 307.696 of theRevised Code; and building and construction materials andservicessold to a construction contractor for incorporation intorealproperty outside this state if such materials and services,whensold to a construction contractor in the state in which therealproperty is located for incorporation into real property inthatstate, would be exempt from a tax on sales levied by thatstate;

(14) Sales of ships or vessels or rail rolling stock used orto beused principally in interstate or foreign commerce, andrepairs,alterations, fuel, and lubricants for such ships orvessels or rail rollingstock;

(15) Sales to persons primarily engaged in any of the activitiesmentioned in division (B)(43)(42)(a) or (g) of this section, to persons engaged in making retail sales, or topersons who purchase for sale from a manufacturer tangiblepersonal property that was produced by the manufacturer inaccordance with specific designs provided by the purchaser, ofpackages, including material, labels, and parts for packages, andofmachinery, equipment, and material for use primarily inpackagingtangible personal property produced for sale, includingany machinery,equipment, and supplies used to make labels orpackages, to prepare packagesor products for labeling, or tolabel packages or products, by or on the orderof the person doingthe packaging, or sold at retail."Packages"includes bags,baskets, cartons, crates, boxes, cans, bottles,bindings,wrappings, and other similar devices and containers, but does not include motor vehicles or bulk tanks, trailers, or similar devices attached to motor vehicles. "Packaging" means placing in a package. Division (B)(14)(15) of this section does not apply to persons engaged in highway transportation for hire.

(16) Sales of food to persons using food stampbenefits topurchase the food. As used in this division,"food" has the same meaning as in the"Food StampAct of 1977,"91Stat. 958, 7 U.S.C. 2012, as amended, and federalregulationsadopted pursuant to that act.

(17) Sales to persons engaged in farming, agriculture,horticulture, or floriculture, of tangible personal property foruse or consumption directly in the production by farming,agriculture, horticulture, or floriculture of other tangiblepersonal property for use or consumption directly in theproduction of tangible personal property for sale by farming,agriculture, horticulture, or floriculture; or material and partsfor incorporation into any such tangible personal property foruseor consumption in production; and of tangible personalpropertyfor such use or consumption in the conditioning orholding ofproducts produced by and for such use, consumption, orsale bypersons engaged in farming, agriculture, horticulture, orfloriculture, except where such property is incorporated into realproperty;

(18) Sales of drugs for a human being, that may be dispensed only pursuant to a prescription;insulin as recognized in the officialUnited States pharmacopoeia; urine and blood testing materialswhen used by diabetics or persons with hypoglycemia to test forglucose or acetone; hypodermic syringes and needles when used bydiabetics for insulin injections; epoetin alfa when purchased foruse inthe treatment of persons with medical disease;hospitalbeds when purchasedfor use by persons with medicalproblems for medical purposes by hospitals, nursing homes, or other medical facilities;and medical oxygen and medical oxygen-dispensingequipment when purchased for useby persons with medical problemsfor medical purposes by hospitals, nursing homes, or other medical facilities;

(19) Sales of prosthetic devices, durable medical equipment for home use, or mobility enhancing equipment, when made pursuant to a prescription and when such devices or equipment are for use by a human being.

(20) Sales of emergency and fire protection vehicles andequipment to nonprofit organizations for use solely in providingfire protection and emergency services, including trauma care andemergencymedical services, for political subdivisions of thestate;

(21) Sales of tangible personal property manufactured inthis state, if sold by the manufacturer in this state to aretailer for use in the retail business of the retailer outside ofthis state andif possession is taken from the manufacturer by thepurchaserwithin this state for the sole purpose of immediatelyremovingthe same from this state in a vehicle owned by thepurchaser;

(22) Sales of services provided by the state or any of itspolitical subdivisions, agencies, instrumentalities,institutions,or authorities, or by governmental entities of thestate or any ofits political subdivisions, agencies,instrumentalities,institutions, or authorities;

(23) Sales of motor vehicles to nonresidents of this stateupon the presentation of an affidavit executed in this state bythe nonresident purchaser affirming that the purchaser is anonresident of this state, that possession of the motor vehicleistaken in this state for the sole purpose of immediatelyremovingit from this state, that the motor vehicle will bepermanentlytitled and registered in another state, and that themotor vehiclewill not be used in this state;

(24) Sales to persons engaged in the preparation of eggsforsale of tangible personal property used or consumed directlyinsuch preparation, including such tangible personal propertyusedfor cleaning, sanitizing, preserving, grading, sorting, andclassifying by size; packages, including material and parts forpackages, and machinery, equipment, and material for use inpackaging eggs for sale; and handling and transportationequipmentand parts therefor, except motor vehicles licensed tooperate onpublic highways, used in intraplant or interplanttransfers orshipment of eggs in the process of preparation forsale, when theplant or plants within or between which suchtransfers orshipments occur are operated by the same person."Packages"includes containers, cases, baskets, flats, fillers,filler flats,cartons, closure materials, labels, and labelingmaterials, and"packaging" means placing therein.

(25)(a) Sales of water to a consumer for residential use,except the sale of bottled water, distilled water, mineral water,carbonated water, or ice;

(b) Sales of water by a nonprofit corporation engagedexclusively in the treatment, distribution, and sale of water toconsumers, if such water is delivered to consumers through pipesor tubing.

(26) Fees charged for inspection or reinspection of motorvehicles under section 3704.14 of the Revised Code;

(27) Sales to persons licensed to conduct a food serviceoperation pursuant to section 3717.43 of the Revised Code, oftangible personal property primarily used directly for thefollowing:

(a) To prepare food for human consumption for sale;

(b) To preserve food that has been or will be preparedforhuman consumption for sale by the food service operator, notincluding tangible personal property used to display food forselection by the consumer;

(c) To clean tangible personal property used to prepare orserve food for human consumption for sale.

(28) Sales of animals by nonprofit animal adoptionservicesor county humane societies;

(29) Sales of services to a corporation described indivision (A) of section 5709.72 of the Revised Code, and sales oftangible personal property that qualifies for exemption fromtaxation under section 5709.72 of the Revised Code;

(30) Sales and installation of agricultural land tile, asdefined in division (B)(5)(a) of section 5739.01 of the RevisedCode;

(31) Sales and erection or installation of portable grainbins, as defined in division (B)(5)(b) of section 5739.01 of theRevised Code;

(32) The sale, lease, repair, and maintenance of, partsfor,or items attached to or incorporated in, motorvehiclesthatareprimarily used for transporting tangible personal property belonging to others byaperson engaged in highway transportation for hire, except for packages and packaging used for the transportation of tangible personal property;

(33) Sales to the state headquarters of any veterans'organization inthis state that is either incorporated andissuedacharter by the congress of the United States or isrecognized bythe United States veterans administration, for useby theheadquarters;

(34) Sales to a telecommunications service vendor, mobile telecommunications service vendor, or satellite broadcasting service vendor oftangible personal property and services used directly andprimarily in transmitting, receiving, switching, or recording anyinteractive, one- or two-way electromagnetic communications, includingvoice, image, data, and information, through the use of anymedium, including, but not limited to, poles, wires, cables,switching equipment, computers, and record storage devices andmedia, and component parts for the tangible personal property.The exemption provided in this division shallbe in lieu of all other exemptions under division (B)(43)(42)(a) of thissection to which the vendor may otherwise be entitled, based upon the use ofthething purchased in providing the telecommunications, mobile telecommunications, or satellite broadcasting service.

(35) Sales of investment metal bullion and investmentcoins."Investment metal bullion" means any elementary preciousmetalthat has been put through a process of smelting orrefining,including, but not limited to, gold, silver, platinum,andpalladium, and which is in such state or condition that itsvaluedepends upon its content and not upon its form."Investment metalbullion" does not include fabricated preciousmetal that has beenprocessed or manufactured for one ormorespecific and customaryindustrial, professional, or artisticuses."Investment coins"means numismatic coins or other formsof money and legal tendermanufactured of gold, silver, platinum,palladium, or other metalunder the laws of the United States orany foreign nation with afair market value greater than anystatutory or nominal value ofsuch coins.

(36)(35)(a) Sales where the purpose of the consumer is to useorconsume the things transferred in making retail sales andconsisting of newspaper inserts, catalogues, coupons, flyers,giftcertificates, or other advertising material thatprices anddescribes tangible personal property offered for retail sale.

(b) Sales to direct marketing vendors of preliminarymaterials such as photographs, artwork, and typesetting that willbe used in printing advertising material; of printed matter thatoffers free merchandise or chances to win sweepstake prizes andthat is mailed to potential customers with advertising materialdescribed in division (B)(36)(35)(a) of this section; and ofequipmentsuch as telephones, computers, facsimile machines, andsimilartangible personal property primarily used to acceptorders fordirect marketing retail sales.

(c) Sales of automatic food vending machines that preservefood with a shelf life of forty-five days or less byrefrigerationand dispense it to the consumer.

For purposes of division (B)(36)(35) of this section,"directmarketing" means the method of selling where consumers ordertangible personal property by United States mail, deliveryservice, or telecommunication and the vendor delivers or shipsthetangible personal property sold to the consumer from awarehouse,catalogue distribution center, or similar fulfillmentfacility bymeans of the United States mail, delivery service, orcommoncarrier.

(37)(36) Sales to a person engaged in the business ofhorticulture or producing livestock of materials to beincorporated into a horticulture structure or livestockstructure;

(38)(37) Sales of personal computers, computer monitors,computer keyboards,modems, and other peripheral computerequipment to an individual who islicensed or certified to teachin an elementary or a secondary school in thisstate for use bythat individual in preparation for teaching elementary orsecondary school students;

(39)(38) Sales to a professional racing team of any of thefollowing:

(a) Motor racing vehicles;

(b) Repair services for motor racingvehicles;

(c) Items of property that areattached to or incorporatedin motor racing vehicles, includingengines, chassis, and allother components of the vehicles, andall spare, replacement, andrebuilt parts or components of thevehicles; except not includingtires, consumable fluids, paint,and accessories consisting ofinstrumentation sensors andrelated items added to the vehicle tocollect and transmit databy means of telemetry and other forms ofcommunication.

(40)(39) Sales of used manufactured homes and used mobilehomes,asdefined in section 5739.0210 of the Revised Code, made on orafterJanuary 1, 2000;

(41)(40) Sales of tangible personal property and services toaprovider of electricity used or consumed directly and primarily ingenerating, transmitting, or distributing electricity for use byothers,including property that is or is to be incorporated intoand will becomea part of the consumer's production, transmission,or distributionsystem and that retains its classification astangible personalproperty after incorporation; fuel or power usedin theproduction, transmission, or distribution of electricity;andtangible personal property and services used in the repair andmaintenance of the production, transmission, or distributionsystem, including only those motor vehicles as are speciallydesigned and equipped for such use. The exemption provided inthis division shall be in lieu of all other exemptions in division(B)(43)(42)(a) of this section towhich a providerof electricity may otherwise be entitled based on the use of thetangiblepersonal property or service purchased in generating,transmitting, ordistributing electricity.

(42)(41) Sales to a person providing services under division (B)(3)(s)(r) of section 5739.01 of the Revised Code of tangible personal property and services used directly and primarily in providing taxable services under that section.

(43)(42) Sales where the purpose of the purchaser is to do any of the following:

(a) To incorporate the thing transferred as a material or a part into tangible personal property to be produced for sale by manufacturing, assembling, processing, or refining; or to use or consume the thing transferred directly in producing tangible personal property for sale by mining, including, without limitation, the extraction from the earth of all substances that are classed geologically as minerals, production of crude oil and natural gas, farming, agriculture, horticulture, or floriculture, or directly in the rendition of a public utility service, except that the sales tax levied by this section shall be collected upon all meals, drinks, and food for human consumption sold when transporting persons. Persons engaged in rendering farming, agricultural, horticultural, or floricultural services, and services in the exploration for, and production of, crude oil and natural gas, for others are deemed engaged directly in farming, agriculture, horticulture, and floriculture, or exploration for, and production of, crude oil and natural gas. This paragraph does not exempt from "retail sale" or "sales at retail" the sale of tangible personal property that is to be incorporated into a structure or improvement to real property.

(b) To hold the thing transferred as security for the performance of an obligation of the vendor;

(c) To resell, hold, use, or consume the thing transferred as evidence of a contract of insurance;

(d) To use or consume the thing directly in commercial fishing;

(e) To incorporate the thing transferred as a material or a part into, or to use or consume the thing transferred directly in the production of, magazines distributed as controlled circulation publications;

(f) To use or consume the thing transferred in the production and preparation in suitable condition for market and sale of printed, imprinted, overprinted, lithographic, multilithic, blueprinted, photostatic, or other productions or reproductions of written or graphic matter;

(g) To use the thing transferred, as described in section 5739.011 of the Revised Code, primarily in a manufacturing operation to produce tangible personal property for sale;

(h) To use the benefit of a warranty, maintenance or service contract, or similar agreement, as described in division (B)(7) of section 5739.01 of the Revised Code, to repair or maintain tangible personal property, if all of the property that is the subject of the warranty, contract, or agreement would not be subject to the tax imposed by this section;

(i) To use the thing transferred as qualified research and development equipment;

(j) To use or consume the thing transferred primarily in storing, transporting, mailing, or otherwise handling purchased sales inventory in a warehouse, distribution center, or similar facility when the inventory is primarily distributed outside this state to retail stores of the person who owns or controls the warehouse, distribution center, or similar facility, to retail stores of an affiliated group of which that person is a member, or by means of direct marketing. This division does not apply to motor vehicles registered for operation on the public highways. As used in this division, "affiliated group" has the same meaning as in division (B)(3)(e) of section 5739.01 of the Revised Code and "direct marketing" has the same meaning as in division (B)(36)(35) of this section.

(k) To use or consume the thing transferred to fulfill a contractual obligation incurred by a warrantor pursuant to a warranty provided as a part of the price of the tangible personal property sold or by a vendor of a warranty, maintenance or service contract, or similar agreement the provision of which is defined as a sale under division (B)(7) of section 5739.01 of the Revised Code;

(l) To use or consume the thing transferred in the production of a newspaper for distribution to the public;

(m) To use tangible personal property to perform a service listed in division (B)(3) of section 5739.01 of the Revised Code, if the property is or is to be permanently transferred to the consumer of the service as an integral part of the performance of the service.

As used in division (B)(43)(42) of this section, "thing" includes all transactions included in divisions (B)(3)(a), (b), and (e) of section 5739.01 of the Revised Code.

(44)(43) Sales conducted through a coin operated device that activates vacuum equipment or equipment that dispenses water, whether or not in combination with soap or other cleaning agents or wax, to the consumer for the consumer's use on the premises in washing, cleaning, or waxing a motor vehicle, provided no other personal property or personal service is provided as part of the transaction.

(45)(44) Sales of replacement and modification parts for engines, airframes, instruments, and interiors in, and paint for, aircraft used primarily in a fractional aircraft ownership program, and sales of services for the repair, modification, and maintenance of such aircraft, and machinery, equipment, and supplies primarily used to provide those services.

(46)(45) Sales of telecommunications service that is used directly and primarily to perform the functions of a call center. As used in this division, "call center" means any physical location where telephone calls are placed or received in high volume for the purpose of making sales, marketing, customer service, technical support, or other specialized business activity, and that employs at least fifty individuals that engage in call center activities on a full-time basis, or sufficient individuals to fill fifty full-time equivalent positions.

(46) Sales by a telecommunications service vendor of 900 service to a subscriber. This division does not apply to information services, as defined in division (FF) of section 5739.01 of the Revised Code.

(47) Sales of value-added non-voice data service. This division does not apply to any similar service that is not otherwise a telecommunications service.

(C) For the purpose of the proper administration of thischapter,and to prevent the evasion of the tax, it is presumedthat allsales made in this state are subject to the tax untilthe contraryis established.

(D)(E)(D) The levy of this tax on retail sales of recreation andsportsclub service shall not prevent a municipal corporation fromlevying any tax onrecreation and sports club dues or on anyincome generated by recreation andsports club dues.

(E) The tax collected by the vendor from the consumer under this chapter is not part of the price, but is a tax collection for the benefit of the state, and of counties levying an additional sales tax pursuant to section 5739.021 or 5739.026 of the Revised Code and of transit authorities levying an additional sales tax pursuant to section 5739.023 of the Revised Code. Except for the discount authorized under section 5739.12 of the Revised Code and the effects of any rounding pursuant to section 5703.055 of the Revised Code, no person other than the state or such a county or transit authority shall derive any benefit from the collection or payment of the tax levied by this section or section 5739.021, 5739.023, or 5739.026 of the Revised Code.

Sec. 5739.025.  As used in this section, "local tax" meansa tax imposed pursuant to section 5739.021, 5739.023, 5739.026,5741.021, 5741.022, or 5741.023 of the Revised Code.

(A) The taxes levied by sections 5739.02 and 5741.02 ofthe Revised Code shall be collected as follows:

(1) On and after July 1, 2003, and on or before June 30, 2005, in accordance with the following schedule:

If the price exceeds one dollar, the tax is six cents on each one dollar. If the price exceeds one dollar or a multiple thereof by not more than seventeen cents, the amount of tax is six cents for each one dollar plus one cent. If the price exceeds one dollar or a multiple thereof by more than seventeen cents, the amount of tax is six cents for each one dollar plus the amount of tax for prices eighteen cents through ninety-nine cents in accordance with the schedule above.

(2) On and after July 1, 2005, and on and before December 31, 2005, in accordance with thefollowing schedule:

If the price exceeds one dollar two dollars, the tax is five eleven cents oneach one dollar two dollars. If the price exceeds one dollar two dollars or a multiplethereof by not more than twenty eighteen cents, the amount of tax is five elevencents for each one dollar two dollars plus one cent. If the price exceedsone dollar two dollars or a multiple thereof by more than twenty eighteen cents, theamount of tax is five eleven cents for each one dollar two dollars plus the amountof tax for prices twenty-one nineteen cents through one dollar and ninety-nine cents inaccordance with the schedule above.

(B) On and after July 1, 2003, and on and before June 30, 2005, the combined taxes levied by sections 5739.02 and 5741.02 and pursuant to sections 5739.021, 5739.023, 5739.026, 5741.021, 5741.022, and 5741.023 of the Revised Code shall be collected in accordance with the following schedules:

(1) When the combined rate of state and local tax is six and one-fourth per cent:

If the price exceeds four dollars, the tax is twenty-five cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than sixteen cents, the amount of tax is twenty-five cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than sixteen cents, the amount of tax is twenty-five cents for each four dollars plus the amount of tax for prices seventeen cents through three dollars and ninety-nine cents in accordance with the schedule above.

(2) When the combined rate of state and local tax is six and one-half per cent:

If the price exceeds two dollars, the tax is thirteen cents on each two dollars. If the price exceeds two dollars or a multiple thereof by not more than fifteen cents, the amount of tax is thirteen cents for each two dollars plus one cent. If the price exceeds two dollars or a multiple thereof by more than fifteen cents, the amount of tax is thirteen cents for each two dollars plus the amount of tax for prices sixteen cents through one dollar and ninety-nine cents in accordance with the schedule above.

(3) When the combined rate of state and local tax is six and three-fourths per cent:

If the price exceeds four dollars, the tax is twenty-seven cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than fourteen cents, the amount of tax is twenty-seven cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than fourteen but by not more than twenty-nine cents, the amount of tax is twenty-seven cents for each four dollars plus two cents. If the price exceeds four dollars or a multiple thereof by more than twenty-nine cents the amount of tax is twenty-seven cents for each four dollars plus the amount of tax for prices thirty cents through three dollars and ninety-nine cents in accordance with the schedule above.

(4) When the combined rate of state and local tax is seven per cent:

If the price exceeds one dollar, the tax is seven cents on each one dollar. If the price exceeds one dollar or a multiple thereof by not more than fifteen cents, the amount of tax is seven cents for each one dollar plus one cent. If the price exceeds one dollar or a multiple thereof by more than fifteen cents, the amount of tax is seven cents for each one dollar plus the amount of tax for prices sixteen cents through ninety-nine cents in accordance with the schedule above.

(5) When the combined rate of state and local tax is seven and one-fourth per cent:

If the price exceeds four dollars, the tax is twenty-nine cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than thirteen cents, the amount of tax is twenty-nine cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than thirteen cents but by not more than twenty-seven cents, the amount of tax is twenty-nine cents for each four dollars plus two cents. If the price exceeds four dollars or a multiple thereof by more than twenty-seven cents, the amount of tax is twenty-nine cents for each four dollars plus the amount of tax for prices twenty-eight cents through three dollars and ninety-nine cents in accordance with the schedule above.

(6) When the combined rate of state and local tax is seven and one-half per cent:

If the price exceeds two dollars, the tax is fifteen cents on each two dollars. If the price exceeds two dollars or a multiple thereof by not more than fifteen cents, the amount of tax is fifteen cents for each two dollars plus one cent. If the price exceeds two dollars or a multiple thereof by more than fifteen cents, the amount of tax is fifteen cents for each two dollars plus the amount of tax for prices sixteen cents through one dollar and ninety-nine cents in accordance with the schedule above.

(7) When the combined rate of state and local tax is seven and three-fourths per cent:

If the price exceeds four dollars, the tax is thirty-one cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than twelve cents, the amount of tax is thirty-one cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than twelve cents but by not more than twenty-five cents, the amount of tax is thirty-one cents for each four dollars plus two cents. If the price exceeds four dollars or a multiple thereof by more than twenty-five cents, the amount of tax is thirty-one cents for each four dollars plus the amount of tax for prices twenty-six cents through three dollars and ninety-nine cents in accordance with the schedule above.

(8) When the combined rate of state and local tax is eight per cent:

If the price exceeds one dollar, the tax is eight cents on each one dollar. If the price exceeds one dollar or a multiple thereof by not more than twelve cents, the amount of tax is eight cents for each one dollar plus one cent. If the price exceeds one dollar or a multiple thereof by more than twelve cents but not more than twenty-five cents, the amount of tax is eight cents for each one dollar plus two cents. If the price exceeds one dollar or a multiple thereof by more than twenty-five cents, the amount of tax is eight cents for each one dollar plus the amount of tax for prices twenty-six cents through ninety-nine cents in accordance with the schedule above.

(9) When the combined rate of state and local tax is eight and one-fourth per cent:

If the price exceeds four dollars, the tax is thirty-three cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than eleven cents, the amount of tax is thirty-three cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than eleven cents but by not more than twenty-four cents, the amount of tax is thirty-three cents for each four dollars plus two cents. If the price exceeds four dollars or a multiple thereof by more than twenty-four cents, the amount of tax is thirty-three cents for each four dollars plus the amount of tax for prices twenty-six cents through three dollars and ninety-nine cents in accordance with the schedule above.

(10) When the combined rate of state and local tax is eight and one-half per cent:

If the price exceeds two dollars, the tax is seventeen cents on each two dollars. If the price exceeds two dollars or a multiple thereof by not more than eleven cents, the amount of tax is seventeen cents for each two dollars plus one cent. If the price exceeds two dollars or a multiple thereof by more than eleven cents but by not more than twenty-three cents, the amount of tax is seventeen cents for each two dollars plus two cents. If the price exceeds two dollars or a multiple thereof by more than twenty-three cents, the amount of tax is seventeen cents for each two dollars plus the amount of tax for prices twenty-four cents through one dollar and ninety-nine cents in accordance with the schedule above.

(11) When the combined rate of state and local tax is eight and three-fourths per cent:

If the price exceeds four dollars, the tax is thirty-five cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than eleven cents, the amount of tax is thirty-five cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than eleven cents but by not more than twenty-two cents, the amount of tax is thirty-five cents for each four dollars plus two cents. If the price exceeds four dollars or a multiple thereof by more than twenty-two cents, the amount of tax is thirty-five cents for each four dollars plus the amount of tax for prices twenty-three cents through three dollars and ninety-nine cents in accordance with the schedule above.

(12) When the combined rate of state and local tax is nine per cent:

If the price exceeds one dollar, the tax is nine cents on each one dollar. If the price exceeds one dollar or a multiple thereof by not more than eleven cents, the amount of tax is nine cents for each one dollar plus one cent. If the price exceeds one dollar or a multiple thereof by more than eleven cents but by not more than twenty-two cents, the amount of tax is nine cents for each one dollar plus two cents. If the price exceeds one dollar or a multiple thereof by more than twenty-two cents, the amount of tax is nine cents for each one dollar plus the amount of tax for prices twenty-three cents through ninety-nine cents in accordance with the schedule above.

(C) On and after July 1, 2005, and on and before December 31, 2005, the combined taxes levied by sections 5739.02 and5741.02 and pursuant to sections 5739.021, 5739.023, 5739.026,5741.021, 5741.022, and 5741.023 of the Revised Code shall becollected in accordance with the following schedules:

(1) When the total rate of local tax is one-fourth percent:

If the price exceeds four dollars, the tax is twenty-onecents on each four dollars. If the price exceeds four dollars ora multiple thereof by not more than nineteen cents, the amount oftax is twenty-one cents for each four dollars plus one cent. Ifthe price exceeds four dollars or a multiple thereof by more thannineteen cents, the amount of tax is twenty-one cents for eachfour dollars plus the amount of tax for prices twenty centsthrough three dollars and ninety-nine cents in accordance withthe schedule above.

(2) When the combined rate of local tax is one-half percent:

If the price exceeds two dollars, the tax is eleven centson each two dollars. If the price exceeds two dollars or amultiple thereof by not more than eighteen cents, the amount oftax is eleven cents for each two dollars plus one cent. If theprice exceeds two dollars or a multiple thereof by more thaneighteen cents, the amount of tax is eleven cents for each twodollars plus the amount of tax for prices nineteen cents throughone dollar and ninety-nine cents in accordance with the scheduleabove.

(3) When the combined rate of local tax is three-fourthsper cent:

If the price exceeds four dollars, the tax is twenty-threecents on each four dollars. If the price exceeds four dollars ora multiple thereof by not more than seventeen cents, the amountof tax is twenty-three cents for each four dollars plus one cent.If the price exceeds four dollars or a multiple thereof by morethan seventeen cents, the amount of tax is twenty-three cents foreach four dollars plus the amount of tax for prices eighteencents through three dollars and ninety-nine cents in accordancewith the schedule above.

(4)(2) When the combined rate of local tax is one one-half per cent:

If the price exceeds one dollar, the tax is six cents oneach one dollar. If the price exceeds one dollar or a multiplethereof by not more than seventeen cents, the amount of tax issix cents for each one dollar plus one cent. If the priceexceeds one dollar or a multiple thereof by more than seventeencents, the amount of tax is six cents for each one dollar plusthe amount of tax for prices eighteen cents through ninety-ninecents in accordance with the schedule above.

(5)(3) When the combined rate of local tax is one andone-fourth three-fourths per cent:

If the price exceeds four dollars, the tax is twenty-fivecents on each four dollars. If the price exceeds four dollars ora multiple thereof by not more than sixteen cents, the amount oftax is twenty-five cents for each four dollars plus one cent. Ifthe price exceeds four dollars or a multiple thereof by more thansixteen cents, the amount of tax is twenty-five cents for eachfour dollars plus the amount of tax for prices seventeen centsthrough three dollars and ninety-nine cents in accordance withthe schedule above.

(6)(4) When the combined rate of local tax is one andone-half per cent:

If the price exceeds two dollars, the tax is thirteen centson each two dollars. If the price exceeds two dollars or amultiple thereof by not more than fifteen cents, the amount oftax is thirteen cents for each two dollars plus one cent. If theprice exceeds two dollars or a multiple thereof by more thanfifteen cents, the amount of tax is thirteen cents for each twodollars plus the amount of tax for prices sixteen cents throughone dollar and ninety-nine cents in accordance with the scheduleabove.

(7)(5) When the combined rate of local tax is one andthree-fourths one-fourth per cent:

If the price exceeds four dollars, the tax is twenty-sevencents on each four dollars. If the price exceeds four dollars ora multiple thereof by not more than fourteen cents, the amount oftax is twenty-seven cents for each four dollars plus one cent. If the priceexceeds four dollars or a multiple thereof by morethan fourteen but by not more than twenty-nine cents, the amountof tax is twenty-seven cents for each four dollars plus twocents. If the price exceeds four dollars or a multiple thereofby more than twenty-nine cents the amount of tax is twenty-sevencents for each four dollars plus the amount of tax for pricesthirty cents through three dollars and ninety-nine cents inaccordance with the schedule above.

(8)(6) When the combined rate of local tax is two one and one-half per cent:

If the price exceeds one dollar, the tax is seven cents oneach one dollar. If the price exceeds one dollar or a multiplethereof by not more than fifteen cents, the amount of tax isseven cents for each one dollar plus one cent. If the priceexceeds one dollar or a multiple thereof by more than fifteencents, the amount of tax is seven cents for each one dollar plusthe amount of tax for prices sixteen cents through ninety-ninecents in accordance with the schedule above.

(9)(7) When the combined rate of local tax is two one andone-fourth three-fourths per cent: