Bill Analysis

Legislative Service Commission

LSC Analysis of House Bill

Am. Sub. H.B. 1*

128th General Assembly

(As Passed by the General Assembly)

 

Reps.     Sykes, Chandler, Brown, Bolon, Book, Celeste, DeBose, DeGeeter, Domenick, Dyer, Hagan, Harris, Harwood, Heard, Koziura, Letson, Luckie, Mallory, Pryor, Stewart, Szollosi, Ujvagi, Weddington, B. Williams, S. Williams, Winburn, Yates, Yuko

Sens.     Carey, Goodman, Harris, Niehaus

Effective date:  July 17, 2009; certain provisions effective October 16, 2009; certain provisions effective on other dates; contains item vetoes

TABLE OF CONTENTS

This final analysis is arranged by state agency, beginning with the Adjutant General and continuing in alphabetical order.  Items that do not directly involve an agency are located under the agency that has regulatory authority over the item, or otherwise deals with the subject matter of the item.  The analysis includes a Local Government category and a Retirement category and ends with a Miscellaneous category.

Within each category, a summary of the items appears first (in the form of dot points), followed by a discussion of their content and operation.

ADJUTANT GENERAL (ADJ) 26

Ohio Army National Guard facility and maintenance expenses. 27

Community Match Armories Fund. 28

Camp Perry/Buckeye Inn Operations Fund. 28

National Guard Service Medal Fund. 29

Ohio National Guard Facility Maintenance Fund. 29

Assistant Adjutant General-Army and Air Force. 29

 

Ohio National Guard Scholarship Program.. 30

Payment of Adjutant General's workers' compensation costs. 30

 

DEPARTMENT OF ADMINISTRATIVE SERVICES (DAS) 30

Leasing space by Department of Administrative Services. 38

State Equal Employment Opportunity Program.. 38

Department's agreements with political subdivisions to provide personnel services. 39

Department's receipt of reimbursement for the use of its county job classification plans. 39

Department's supervision of county personnel departments. 39

Department's responsibility for administering examinations for positions in the service of
the state. 41

Changes in amount of annual vacation leave accrued by certain state employees. 41

Payment for denied vacation leave. 42

Grant of additional sick leave credit to state employees in July 2011. 43

Moratoria on the accrual and annual payment of personal leave. 43

One-time pay supplement in August 2011 to state employees paid by warrant of the
Director of Budget and Management 44

Use of compensatory time balance to supplement disability leave payments. 45

Payment of employee share of various benefits when employee is on disability leave. 45

Salary continuation program for service-connected injuries and changes to occupational
injury leave program.. 45

Elimination of probationary periods for intermittent employees. 47

Elimination of involvement of the Department in layoffs not affecting employees paid by
warrant of the Director of Budget and Management 47

Department's responsibility for the administration of layoff displacement rights. 48

Calculation of retention points for state employees affected by a layoff 48

Mandatory cost savings days for exempt state employees. 49

Creation of the Cost Savings Fund to account for savings from employee participation in
the mandatory cost savings program and cost savings days. 51

Miscellaneous civil service changes. 51

Pay reduction for exempt employees of the Auditor of State. 52

Health Care Spending Account Fund. 52

Dependent Care Spending Account Fund. 52

State Employee Educational Development Fund. 52

MARCS Administration Fund. 53

State employee payroll reduction strategies. 53

Preference for purchasing products made and services performed in the United States
and Ohio with funds made available for fiscal stabilization and recovery purposes. 54

Sufficient competition for purchase of Ohio-produced or mined products (VETOED) 54

Contractor compliance with local regulations or ordinances that relate to the employment of residents and local businesses. 55

Databases of state employee pay, agency expenses, and tax credit issuances published
on one Internet web site (PARTIALLY VETOED) 55

Life insurance coverage for county and municipal court judges. 56

Removal of obsolete pay tables prescribing pay for exempt employees. 56

State agency spending controls. 56

State agency spending plans and their implementation. 57

Specific state agency spending controls. 58

Compliance with a new uncodified statute based on Executive Order 2008-13S in
complying with the Minority Set Aside Act and EDGE Business Enterprise Act 60

Equal Employment Opportunity Officers. 61

Agency contract provisions. 62

EDGE waiver controls. 62

Annual compliance report 63

Deadline of December 31, 2009, for state agencies to establish a long–term plan for
compliance with the Minority Set Aside Act and EDGE Business Enterprise Act 63

Explicit requirement to comply with Minority Business Set Aside Act and Edge Business Enterprise Act 64

Changes in the Minority Business Bonding Program.. 64

Minority Business Bonding Program.. 64

Two-year pilot project involving the conversion of 10% of certain vehicles of the state fleet
to a propane fuel system (VETOED) 67

 

DEPARTMENT OF AGING (AGE) 68

Residential State Supplement program.. 72

Background. 72

Eligibility and payments amounts. 72

Residential State Supplement Workgroup (VETOED) 73

PACE program.. 74

Background. 74

Expansion of PACE program.. 75

Home first process. 75

Kosher home-delivered meals under the PASSPORT program.. 76

Choices Program.. 76

Assisted Living Program.. 77

Consolidated federal Medicaid waivers. 77

Home First reports. 78

Civil penalties against long-term care providers. 78

Community-based long-term care services. 80

Unified long-term care budget 81

Interagency agreement regarding unified long-term care budget 81

Services to be available under the unified long-term care budget 82

Care management and authorization services. 83

Federal approval 83

Rules. 84

Unified Long-Term Care Budget Workgroup (PARTIALLY VETOED) 84

Progress report on unified long-term care budget 85

Transfer of appropriations. 85

Long-Term Care Consultation Program.. 86

Background. 86

Provision of consultations. 86

Periodic or follow-up consultations. 87

Program administration. 88

Fines. 89

Monitoring of home and community-based services. 89

Annual report 89

Ohio's Best Rx Program.. 90

Ohio Community Service Council 90

Brain Injury Advisory Committee. 92

 

DEPARTMENT OF AGRICULTURE (AGR) 93

Sustainable Agriculture Program Fund. 96

Changes in certain operating and development funds. 96

Fee changes in Nursery Stock and Plant Pests Law.. 97

Gypsy Moth Suppression Program.. 98

Central Support and Indirect Costs Fund. 99

Fee for license to operate meat or poultry processing establishment 99

Livestock Dealers Law.. 100

Changes in definitions and fees. 100

Small dealers of livestock license. 101

Other provisions. 102

Garbage-Fed Swine and Poultry Law.. 103

Rendering Plants Law.. 103

Food processing establishment registration. 104

Amusement ride inspections. 107

Wine tax diversion to Ohio Grape Industries Fund. 107

Ohio Pet Fund. 107

Veterinarian Loan Repayment Program.. 108

Ohio Farm Loan Fund. 108

Ohio Beekeepers Task Force. 108

 

AIR QUALITY DEVELOPMENT AUTHORITY (AIR) 110

Energy Strategy Development Program.. 111

Allocation of the Qualified Energy Conservation Bond limitation. 111

Advanced energy. 112

 

DEPARTMENT OF ALCOHOL AND DRUG ADDICTION SERVICES (ADA) 113

Anabolic steroid warning sign. 114

Annual reports on use of state and federal funds for administrative functions. 114

Information systems maintained by ODADAS and ODMH.. 115

Indigent drivers alcohol treatment funds. 116

Prior and continuing law.. 116

Changes made by the act 117

Annual reports by ADAMHS boards. 117

ODADAS representation on the Ohio Commission on Fatherhood. 118

 

ATHLETIC COMMISSION (ATH) 118

Expansion of Ohio Athletic Commission licensing authority. 119

Evidence of financial security that a promoter must submit with a license application and verification of the application. 119

Information contained on a boxing or martial arts or wrestling promoter's license. 119

Commission rules regarding medical examination before and after bouts the Commission regulates  120

Fines for violation of the Ohio Athletic Commission Law.. 120

Grounds for Ohio Athletic Commission to revoke, suspend, or refuse to renew a license. 120

Clarification of Ohio Athletic Commission fee statute. 121

 

ATTORNEY GENERAL (AGO) 121

Peace officer training and reporting requirements. 122

Hours of training in certain areas. 122

Agency reports to OPOTC.. 123

Exemption from peace officer training requirements. 123

Reparations Fund and Crime Victims Reparations Law--payment of attorney's fees
incurred to obtain a restraining order, custody order, or other order to separate a victim
from an offender 124

Concealed carry licenses. 124

Amount of fee. 124

Deposit and distribution of fee. 126

Firearms pamphlet 127

Renewal applications. 127

Definition of "unloaded" as used in offense of improperly handling firearms in a motor
vehicle. 128

 

AUDITOR OF STATE (AUD) 128

General Revenue Fund transfers for certain unpaid audit costs (VETOED) 129

Public Audit Expense Fund-Independent Auditors. 130

Appropriation of GRF transfers. 130

 

STATE BARBER BOARD (BRB) 130

Optional charge during barber license renewal to fund barber museum.. 130

 

OFFICE OF BUDGET AND MANAGEMENT (OBM) 131

Federal money made available to the state for fiscal stabilization and recovery purposes. 132

Legislative approval of certificates of participation (VETOED) 132

Preparation of list of state employees who work primarily for one state agency while being
paid with funds appropriated to another (VETOED) 133

Reporting related to segregated custodial funds. 133

Employment status of OBM employees whose primary duties include the consolidation of statewide financing functions and common transactional processes. 133

Reports monitoring the effectiveness of federal stimulus funds. 134

Semi-annual reports. 134

Quarterly reports. 134

 

CAPITOL SQUARE REVIEW AND ADVISORY BOARD (CSR) 135

Placement of the Capitol Square Review and Advisory Board in the legislative branch of
state government (VETOED) 135

Exemption of the Board from jurisdiction of the Office of Information Technology
(VETOED) 136

 

STATE CHIROPRACTIC BOARD (CHR) 136

Renewal of licenses to practice chiropractic. 137

 

CIVIL RIGHTS COMMISSION (CIV) 137

Civil Rights Law.. 138

The Ohio Fair Housing Law.. 138

Enforcement of the Ohio Fair Housing Law.. 138

Administrative hearing; election of civil action under Attorney General 138

Private civil action. 139

Operation of the act 139

Definition of "aggrieved person" 139

Authority to request subpoenas. 140

Participation in administrative hearing. 140

Right to intervene in civil action the Attorney General maintains. 140

 

 

DEPARTMENT OF COMMERCE (COM) 141

Unclaimed Funds Trust Fund costs and fees of administration. 144

Public Depository Law.. 144

Independence of the Superintendent and Division of Financial Institutions (PARTIALLY VETOED) 145

Implementation of the federal Secure and Fair Enforcement for Mortgage Licensing Act
of 2008 ("S.A.F.E. Act") 145

Background. 145

Overview of the act 147

Application for a loan originator license; investigation. 150

Issuance of license; license renewals. 151

Pre-licensing instruction; written test 153

Bond requirement 155

Continuing education requirement 156

Conduct of business. 157

Duties and standards of care. 158

Required disclosures. 159

Prohibitions; penalties and damages. 160

Enforcement; administrative actions; reports to NMLSR.. 161

Information shared with NMLSR; confidentiality; challenge process. 162

Rule-making authority. 163

Transition to licensed loan originators. 164

Conforming changes. 164

Credit union compliance with the federal S.A.F.E. Act 165

Regulation of mortgage lenders under the Mortgage Loan Law.. 165

Registration required; exemptions. 165

Application; investigation. 167

Renewal 168

Net worth or bond requirement 169

Permissible fees and other charges. 170

Choice of law.. 171

Duties and standards of care. 171

Required disclosures; advertising. 172

Prohibitions; penalties. 173

Enforcement; administrative actions; reports to NMLSR.. 175

Confidentiality. 177

Credit union service organization exemption requirements. 178

Transition to the new requirements. 180

Regulation of mortgage brokers under the Mortgage Brokers Law.. 181

Registration required; exemptions. 181

Application; operations manager; investigation; renewals. 184

Surety bond requirement 186

Call reports to NMLSR; annual reports. 186

Disclosures. 187

Advertising. 187

Prohibitions; penalties. 187

Enforcement; administrative actions; damages. 188

Mortgage banker exemption requirements. 189

Credit union service organization exemption requirements. 191

Transition to the new requirements. 192

Assessments for video service authorizations. 192

Division of Securities. 193

Securities license and filing fee increases. 193

Fees associated with the transfer of a securities dealer or investment adviser license. 194

Investor Education and Enforcement Expense Fund. 194

State Fire Marshal's Fund. 194

Creation of the Division of Labor 195

The Division of Labor and Worker Safety and the Division of Industrial Compliance. 195

Division of Labor 197

Increase in fees for boiler inspections and related occupational licenses. 198

Changes to the fees charged for elevator inspections. 199

The Real Estate Brokers Law.. 201

Licensing--fees. 201

Real Estate Recovery Fund. 202

Real Estate Appraiser Law.. 202

 

STATE BOARD OF COSMETOLOGY (COS) 207

Restoration of expired license. 207

Fines. 208

Cosmetology licensing. 208

 

COUNSELOR, SOCIAL WORKER, AND MARRIAGE AND FAMILY THERAPIST
BOARD (CSW)
209

New fees. 209

Authority to fine. 210

 

DEPARTMENT OF DEVELOPMENT (DEV) 210

Expansion of "Appalachian region" 213

Local development districts. 214

Export promotion assistance and foreign investment 214

State subsidy for hosting sports events. 214

Development Financing Advisory Council 216

Capital access loans for minority business enterprises. 217

Rules for application by minority business for a bond. 218

Community development corporations--Minority Business Enterprise Loan Program.. 218

Disposition of Build American Bond payments related to liquor profit debt service. 219

Micro-lending Program (PARTIALLY VETOED) 220

Rapid outreach loans. 220

Logistics and Distribution Infrastructure Taxable Bond Fund. 221

Duties of Director of Development 222

Department of Development program to encourage businesses to hire individuals from significantly disadvantaged groups. 222

Low- and Moderate-Income Housing Trust Fund. 223

Venture Capital Authority tax credits. 224

Composition of Authority. 224

Investment purposes. 225

Maximum tax credit issuance. 225

Port authority bond funding of Third Frontier through OVC Program.. 225

Investment policy. 226

Reporting. 227

Loan guarantees for historic rehabilitation projects. 227

Compressed air included in the definition of alternative fuel 228

Alternative Fuel Transportation Grant Program.. 228

State vehicles capable of using alternative fuel 228

Allocation of National Recovery Zone Bond Limitations. 229

 

DEPARTMENT OF EDUCATION (EDU) 229

Interstate Compact 237

I.  State Funding for Primary and Secondary Education. 249

Introduction. 249

Spending accountability for school districts. 250

Spending plans. 250

Spending plans for school districts with low graduation rates. 251

Temporary provision--fiscal year 2010. 251

Permanent provisions. 251

Rules for expenditure and reporting. 253

Statutory spending requirements. 254

Sanctions. 256

Waivers. 259

FACT form.. 259

PASS form.. 259

Ohio School Funding Advisory Council 260

Council membership. 261

Subcommittee on school district-community school collaboration. 263

Other subcommittees. 264

Staff assistance. 264

Use of state funds--all-day kindergarten and class-size reduction. 264

Use of state funds--ESC services and joint programs. 264

Designation of creative learning environments. 264

Harmon Commission. 265

State Board guidelines and Department of Education assistance. 265

Designation of creative learning environments. 265

Progress reports. 266

Acceptance of donations. 267

Grants and stipends. 267

Joint vocational school districts. 267

Educational service center funding. 267

Community school and STEM school payments. 268

Formula amount for other purposes. 268

Ed Choice funding. 269

Deductions. 269

Maximum scholarship amounts (PARTIALLY VETOED) 269

Post-Secondary Enrollment Options alternative funding. 270

School fees for low-income students. 271

Payments for students in residential facilities. 271

Background. 271

The act 272

Legal claims for reimbursement of reduced funds. 272

Nonpublic school administrative cost reimbursement 272

Sharing of stimulus funds with nonpublic schools. 273

II.  Academic Standards and Assessments. 274

Minimum standards for schools. 274

Minimum school district operating standards. 274

Construction; application of Collective Bargaining Law.. 275

Standard for reporting financial information to the public. 276

Academic standards and model curricula. 276

Background. 276

Adoption of revised standards and curricula in core subjects. 277

Adoption of standards and curricula in other subjects. 278

Committee to advise on standards and curricula. 279

Achievement assessments. 279

Background. 279

Name and content changes. 280

Scoring levels. 280

Administration dates. 281

Public records status of OGT. 282

Temporary suspension of writing and social studies assessments. 283

Replacement of OGT as graduation requirement 283

National assessment and end-of-course exams. 284

Senior project 284

Scoring requirements. 285

Timeline for development and implementation. 285

Exemption for disabled students. 286

Performance indicators for district and building report cards. 286

Report card data on college and work readiness. 287

Background--prior law.. 287

Diagnostic assessments. 287

Community service education. 288

Background. 288

College and career readiness; financial literacy. 289

All-day kindergarten. 290

Authority to charge tuition for all-day kindergarten. 290

Annual surveys. 291

Reduction of excused calamity days; study of extended school year 291

Interstate Compact on Educational Opportunity for Military Children. 292

Introduction. 292

Matters between a "sending state" and a "receiving state" 293

Applicability. 293

Records and enrollment 293

Placement 295

Graduation requirements. 295

Excused absences. 295

Extracurricular participation. 296

State coordination. 296

Business education standards (PARTIALLY VETOED) 297

Parental involvement best practices. 298

Waiver of eighth-grade American history. 298

High school credit 298

Student absences for extracurricular activities. 299

III.  Educator Licensure and Employment 299

Educator licensure. 299

New teacher licenses. 300

Alternative resident educator license. 304

One-year conditional teaching permits. 306

Provisional license for teaching in a STEM school 307

Principal licenses. 308

Continuing effect of former licenses. 308

Ohio Teacher Residency Program.. 308

Approval of educator preparation programs. 309

Report on quality of teacher preparation programs. 310

Sharing of value-added data with Chancellor 310

Licensure of school nurses. 310

School Health Services Advisory Council 311

Educator Standards Board. 313

Duties of Board. 313

Membership. 315

Subcommittees on standards. 316

Peer assistance and review programs. 318

Teach Ohio Program.. 318

Ohio Teaching Fellows Program.. 319

Teacher tenure. 320

Background. 320

The act 321

Termination of educator employment contracts. 322

Background. 322

The act 323

Contract termination referees. 323

IV.  Community Schools. 324

Background. 324

Closure of poorly performing community schools. 325

Exemptions. 325

Handling of student records after school closes. 326

Oversight of sponsors. 326

Annual report on community school sponsors. 327

New start-up community schools. 327

Report cards. 328

Unauditable community schools. 328

Exception to community school location. 329

Conversion community schools. 329

E-school expenditures for instruction. 330

Community school calamity days (VETOED) 330

V.  Scholarship Programs. 331

Ed Choice eligibility (VETOED) 331

Background. 331

Vetoed eligibility standards. 332

Administration of achievement assessments to scholarship students. 333

VI.  Early Childhood Programs. 334

Center for Early Childhood Development 334

Early Childhood Advisory Council 335

Early Childhood Financing Workgroup. 335

State-funded early childhood education programs. 335

Early Learning Initiative (VETOED) 338

ODJFS duties. 339

ODE duties. 339

Joint ODJFS and ODE duties. 339

Contracting with an early learning agency. 340

Terms of the contract 340

Early learning program duties. 341

Eligible expenditures. 342

Early Childhood Cabinet--health district representation. 342

Inspection of preschool and latchkey programs. 342

VII.  Other Provisions. 342

Strategic plan. 342

Partnership for Continued Learning. 343

Background. 343

Center for Creativity and Innovation. 346

Audio recordings of State Board meetings. 347

Ohio Education Computer Network. 348

Programs. 348

ITC funding reserves. 349

Use of volunteers by Department of Education. 349

Family and civic engagement teams. 349

Combining with business advisory council 350

Corporal punishment 350

Administration of prescription drugs to students. 350

School Health and Safety Network; periodic review of school safety policies. 351

Background--the repealed law.. 351

School policies on food allergies. 352

Criminal records checks of school employees. 352

Background. 352

The act 353

School emergency procedures. 354

School safety and violence in-service training. 354

Special education. 355

ESC switches by local school districts. 355

Background. 355

Moratorium on ESC switches (VETOED) 356

State Board procedures for approval of ESC switches (VETOED) 356

Dissolution procedures for ESCs (VETOED) 357

Continuation of services to "city" and "exempted village" districts (PARTIALLY
VETOED) 357

Pledge of allegiance. 358

Vocational education contracts. 358

Termination of school district transportation staff 359

Creation and operation of a regional student education district (RSED) 359

Creation. 359

Board of directors. 360

Provision of services. 360

Status and authority of RSED and board of directors. 360

Officers. 361

Procuring liability insurance. 361

Changes to and dissolution of the RSED.. 361

Tax levy to fund RSED services. 362

Resolution to levy tax. 362

Effect of levy adoption, rejection, or expiration. 363

Creation of RSED special fund to hold tax levy proceeds. 363

School district ninety-nine year lease of excess real property. 363

School construction bonds:  40-year maturity. 364

Transfer of School Employees Health Care Board (VETOED) 365

 

 

STATE EMPLOYMENT RELATIONS BOARD (ERB) 366

Administrative merger of the State Employment Relations Board and the State Personnel
Board of Review.. 368

Background. 368

Administrative merger 369

Abolishment of the Transcripts and Other Documents Fund. 370

Changes regarding the appointment and classification of specified SERB employees. 371

Method of conducting a representation election for collective bargaining. 372

Collective bargaining for members and employees of the Capitol Square Review and
Advisory Board (VETOED) 372

Collective bargaining for independent home care providers and independent child care providers. 373

Introduction. 373

Collective bargaining rights of providers. 374

Collective bargaining rights of representative organizations. 374

Collective bargaining agreements. 375

SERB authority. 376

Applicable definitions. 376

Effective period. 376

 

BOARD OF REGISTRATION FOR PROFESSIONAL ENGINEERS AND
SURVEYORS (ENG)
376

Professional engineer or surveyor registration verification. 377

 

ENVIRONMENTAL PROTECTION AGENCY (EPA) 377

State solid waste disposal fees; construction and demolition debris disposal fees. 381

Funding for Environmental Protection Fund. 381

Funding for Soil and Water Conservation District Assistance Fund. 382

Exemption from new solid waste disposal fees (VETOED) 382

Electronic filing of fees. 382

Payment of solid waste disposal fees. 382

Solid waste generation fees--composted and recycled materials. 383

Solid waste management district rules governing out-of-district waste. 383

Scrap Tire Grant Fund; Scrap Tire Management Fund; tire fees. 384

Extension of E-Check; Auto Emissions Test Fund (PARTIALLY VETOED) 385

Clean Diesel School Bus Fund. 389

Extension of various air and water fees and related provisions. 389

Synthetic minor facility emissions fees. 389

Water pollution control fees and safe drinking water fees. 390

Certification of operators of water supply systems or wastewater systems. 391

Application fees under Water Pollution Control Law and Safe Drinking Water Law.. 392

Hazardous waste facility permit modifications. 392

Natural Resources Damages Fund; Hazardous Waste Clean-up Fund; Environmental
Protection Remediation Fund. 393

Air contaminant source installation permits. 394

Environmental Review Appeals Commission:  deadlines for the issuance of orders. 395

 

eTECH COMMISSION (ETC) 396

Background. 396

State education technology plan. 396

Interactive distance learning pilot project 397

Permanent provision. 397

Temporary provision. 398

Evaluation of the Pilot Project 400

 

OFFICE OF THE GOVERNOR (GOV) 401

Service Coordination Workgroup. 401

Executive orders of the Governor 402

Prohibition on the use of prison labor at the Governor's Residence (VETOED) 403

 

DEPARTMENT OF HEALTH (DOH) 403

Confidentiality of child fatality review board reports. 410

Child fatality review board annual report 410

Annual report of the Department of Health and the Children's Trust Fund Board. 410

Help Me Grow program funding. 411

Help Me Grow home-visiting programs. 411

Help Me Grow Advisory Council 412

Governor's Advisory Council on Physical Fitness, Wellness, and Sports. 413

HIV testing. 414

Licensure as a freestanding diagnostic imaging center 417

Certificate of Need program.. 418

Background--long-term care beds. 418

Limited extension of the moratorium on new long-term care beds. 418

Replacement or relocation within the same county. 419

Relocation from a contiguous county. 419

Comparative review for relocation between counties. 420

Review procedures. 424

Reasons for CON denial 425

Dentist Loan Repayment Program.. 427

Dental health resource shortage areas. 427

Eligibility requirements. 427

Application. 427

Recruitment efforts. 427

Parties to the loan repayment contract 428

Length of service. 428

Repayment amount 428

Failure to complete service obligation. 428

Assignment of duty to repay loans. 429

Dentist Loan Repayment Advisory Board. 429

Vital statistics fees. 429

Vital statistics--reports of deaths to county auditors and boards of elections (PARTIALLY VETOED) 430

Fees for board of health services. 431

Background. 431

Fee categories (PARTIALLY VETOED) 433

Definition of palliative care. 434

Hospice licensing fees. 435

Nursing home and residential care facility licensing fees. 435

Nurse Aide Registry. 436

Removal of name from registry. 436

Nursing home administrator annual registration fee. 437

Adult care facilities. 437

Background. 437

License to operate adult care facility--application process. 437

Restrictions on applying for license. 438

Determining number of residents for license. 438

Temporary licenses. 439

Waiver of licensing requirements. 439

Restrictions on facility placement 439

Inspection of adult care facilities. 441

Correcting violations. 441

Fines. 442

Civil penalties. 442

Injunctions. 443

Transfer or discharge of resident 443

Authorization to enter facility. 444

Persons authorized to provide skilled nursing care. 445

Department of Health complaint number 445

Technical changes. 445

Community alternative homes. 445

Hospital accreditation. 446

Handlers of radioactive material and radiation-generating equipment 447

Radiation experts. 448

Disease and Cancer Commission (VETOED) 448

Hemophilia Advisory Council (VETOED) 449

Council responsibilities. 449

Council membership. 449

Sickle Cell Anemia Advisory Committee (VETOED) 451

Federal funds for abstinence education (VETOED) 451

Extension of moratorium regarding the sewage treatment systems program.. 452

Agricultural labor camp licensing fees. 453

 

COMMISSION ON HISPANIC-LATINO AFFAIRS (SPA) 453

Changes in legislative membership of Commission on Hispanic-Latino Affairs. 453

 

OHIO HOUSING FINANCE AGENCY (HFA) 454

Housing assistance for honorably discharged veterans. 454

Grants for Grads Program.. 455

Program eligibility. 455

Receipt of assistance. 456

Lien on first home. 457

 

DEPARTMENT OF INSURANCE (INS) 458

Review of health insuring corporation's capability and availability of services--certificate of authority  460

Franchise plans. 462

Independent, external reviews of health care coverage decisions. 463

External reviews at the request of the insured person. 463

Automatic external reviews. 463

Insurance prompt payment fines--disposition. 465

Electronic payment of claims. 465

Health insurance premium rate filing. 465

Limiting age for dependent child coverage under a health care plan or insurance policy (PARTIALLY VETOED) 466

Exceptions. 467

Deduction for coverage for older children. 468

Mandated review by Superintendent of Insurance--exemption. 469

Mandatory open enrollment period for health insurance coverage. 469

Maximum number of required enrollees. 470

Rates for open enrollment coverage. 471

Delay in open enrollment coverage. 472

Preexisting conditions. 472

Commissions for open enrollment contracts. 472

Exceptions. 473

Rules adopted by the Superintendent 473

Group-to-individual policy conversions. 474

Continuation of group health insurance coverage. 475

Administrative expenses incurred by sickness and accident insurers. 475

Employer-sponsored health insurance coverage. 477

Implementation. 478

Definitions. 479

Health Care Coverage and Quality Council 479

Council membership. 479

Duties and reports (PARTIALLY VETOED) 481

Exemption from sunset requirements. 483

The Ohio Fair Plan Underwriting Association. 483

Rates for basic property insurance and homeowners insurance. 483

Binders for basic property insurance and homeowners insurance. 483

Property and casualty insurance reporting requirements. 484

Providers of investment options under alternative retirement plans. 486

 

DEPARTMENT OF JOB AND FAMILY SERVICES (JFS) 486

I.  General 500

Expenditure of federal grant funds obligated by the Ohio Department of Job and Family Services (ODJFS) for financial allocations to county family services agencies and local workforce investment boards. 500

ODJFS General Services Administration and Operating Fund. 501

Collaboration on welfare reform training. 502

Action against a county regarding family services duties. 502

Reallocation of unused county funds (VETOED) 503

Direct deposit system for cash assistance. 504

II.  Child Welfare and Adoption. 506

State adoption maintenance subsidy and post adoption special services subsidy. 506

Listing of children available for adoption and prospective adoptive parents. 507

Alternative Response pilot program.. 508

ODJFS review of associations and institutions (VETOED) 509

III.  Publicly Funded Child Care. 509

Reimbursements for providers of publicly funded child care. 509

Certificates of payment for days a child has been absent 509

Eligibility determinations for publicly funded child care. 510

Child day-care center and home inspections and day-care law violations. 510

Liability insurance for type A and type B family day-care homes. 511

Committee to study publicly funded child care services. 511

IV.  Child Support Enforcement 512

Office of Child Support requests for medical insurance information. 512

Issuance of income withholding notices. 513

Mandatory electronic remittance of child support by certain payors. 513

Remittance of combined child support payments. 513

Waiver and compromise of assigned child support arrearages. 514

V.  Temporary Assistance for Needy Families (TANF) 514

Ohio Works First (OWF) sanctions. 515

Notices of number of months of OWF Participation. 516

Prevention, Retention, and Contingency (PRC) Program Suspensions. 516

VI.  Medicaid. 517

Annual Medicaid eligibility redeterminations for parents. 517

Medicaid third party liability. 517

Background. 517

Duties of liable third parties. 518

Time-limited Medicaid provider agreements. 519

Administrative actions relative to Medicaid provider agreements. 519

Exception related to conviction of offense. 519

Exception related to not billing for two years. 520

Exception related to National Provider Identifier (PARTIALLY VETOED) 520

Disqualifying offenses--Medicaid providers and home and community waiver services
providers. 520

Medicaid fraud, waste, and abuse report (PARTIALLY VETOED) 521

Prior authorization for high-technology radiological services. 521

Medicaid nonemergency medical transportation management 522

ODJFS Pharmacy and Therapeutics Committee (PARTIALLY VETOED) 523

Administration. 523

Membership. 523

ODJFS web site. 524

Study of Medicaid provider franchise permit fees. 524

Medicaid health insuring corporation franchise permit fee. 525

Nursing home and ICF/MR franchise permit fees. 525

Funds. 525

Changes to nursing home and hospital franchise permit fee. 526

Changes to ICF/MR franchise permit fee. 529

Medicaid rates for nursing facilities. 530

Inflation adjustments used in nursing facility rates. 531

Deadline for nursing facility to submit corrections. 532

Nursing facilities' direct care costs. 533

Nursing facilities' ancillary and support costs. 533

Nursing facilities' franchise permit fee rates. 533

Prohibitions on certain Medicaid billings. 533

Costs of therapy and covered therapy services. 534

FY 2010 and FY 2011 Medicaid reimbursement rates for nursing facilities. 534

Nursing facility capital costs study (VETOED) 537

Medicaid rates for ICFs/MR.. 538

ICF/MR off-site day programming. 539

Medicaid coverage of oxygen services for ICF/MR residents (VETOED) 539

Limits on costs of outside ICF/MR resident meals. 540

FY 2010 Medicaid reimbursement rate for ICFs/MR.. 541

FY 2011 Medicaid reimbursement rate for ICFs/MR.. 541

ICF/MR Reimbursement Study Council (VETOED) 542

Nursing facility refund of excess depreciation. 543

Medicaid debt collection process (VETOED) 544

Estimate of Medicaid debt 544

Withholding. 545

Determination of actual Medicaid debt 547

Release of withholding. 548

Medicaid Payment Withholding Fund. 549

Home first rules for home and community-based services. 549

Home care attendant services. 550

Requirements for home care attendant service providers. 551

Assisting with nursing tasks and self-administration of medication. 552

Practice of nursing without a license. 555

Selection of authorized representative. 555

Rules. 555

Fiscal activities related to Medicaid waiver programs. 556

Money Follows the Person Enhanced Reimbursement Fund. 556

Background. 556

The act 557

Community behavioral health boards' administrative costs (PARTIALLY VETOED) 557

Funding of Medicaid-covered behavioral health services (VETOED) 557

Hospital assessments. 558

Amount of assessment 559

Notice of assessments. 560

Paying assessments. 560

Hospital audits. 561

Hospital Assessment Fund. 561

Hospital Inpatient and Outpatient Supplemental UPL Program.. 561

Federal issues. 561

Rules. 562

Sunset 562

Cost outlier and supplemental payments to children's hospitals. 562

Background. 562

The act 563

Increase in Medicaid rates for hospital inpatient and outpatient services. 564

Postponement of recalibration for hospitals. 564

Reduction in Medicaid rates for community provider services. 565

Medicaid dispensing fee for noncompounded drugs. 566

Durable medical equipment study. 566

Prompt Payment Policy Workgroup (VETOED) 566

VII.  Hospital Care Assurance Program (HCAP) 567

Delay of termination of HCAP.. 567

VIII.  Children's Health Insurance Program.. 568

School-based health centers as CHIP providers (VETOED) 568

IX.  Children's Buy-In Program.. 568

Eligibility requirements. 569

X.  Disability Medical Assistance Program.. 570

Disability Medical Assistance Program abolished. 570

XI.  Supplemental Nutrition Assistance Program (Food Stamp Program) 571

Name of Food Stamp Program changed. 571

Issuance of SNAP benefits. 572

XII.  Workforce Development 572

XIII.  Unemployment Compensation. 572

Reduction of unemployment compensation benefits. 572

 

 

JOINT LEGISLATIVE ETHICS COMMITTEE (JLE) 573

Creation of the Joint Legislative Ethics Committee Investigative Fund. 574

Payment of legislative agent registration fees by the state agency that employs legislative agents. 574

 

JUDICIARY, SUPREME COURT (JSC) 574

Annual compensation of judges. 577

Reimbursement of compensation of substitute judges in municipal and county courts. 577

Pay period for certain municipal court clerks. 578

Lorain County Court of Common Pleas. 579

Supreme Court filing fee. 581

General provision. 581

Exception. 581

Modification of Rules of Practice. 582

Administrative costs for collecting additional filing fees to assist legal aid societies. 582

Impersonating a peace officer--definition of "peace officer" 583

Disclosure of peace officer's residence address in BMV records--definition of "peace
officer" 584

Prohibition against insurers considering certain motor vehicle accidents of specified
employees. 585

Award of a gasoline purchase card for playing a skill-based amusement machine
(VETOED) 586

Cost of electronic monitoring devices. 587

Appeals. 587

Execution of supersedeas bond (VETOED) 587

Exceptions to execution of supersedeas bond (VETOED) 588

 

LEGAL RIGHTS SERVICE COMMISSION (LRS) 588

Legal Rights Service Commission Transition Study. 588

 

LEGISLATIVE SERVICE COMMISSION (LSC) 590

Changes in the House and Senate Telephone Usage Fund. 590

 

STATE LIBRARY BOARD (LIB) 590

Bill and Melinda Gates Foundation Grant Fund. 590

 

LIQUOR CONTROL COMMISSION (LCO) 591

Number of D-5l permits that may be issued in a municipal corporation or township. 592

Overview of law governing Sunday sales of beer, wine and mixed beverages, or
intoxicating liquor 592

Changing Sunday sale of intoxicating liquor questions from between 1 p.m. and midnight
to between 11 a.m. and midnight 593

Law generally retained by the act 593

Changes made by the act 594

Changes in procedure for local option elections on liquor sales at a particular location. 595

Change in the petition requirements and in the wording of the questions on the ballot 595

Effect of election concerning Sunday liquor sales. 596

Changes in procedure for local option elections on liquor sales at a community facility. 597

Change in the petition requirements and in the wording of the questions on the ballot 597

Effect of election concerning Sunday liquor sales. 598

 

Liquor permits in certain community entertainment districts. 598

Serving or consumption of alcohol on state property (VETOED) 598

 

LOCAL GOVERNMENT (LOC) 599

Financial planning and supervision commissions. 602

County board of revision. 604

Minimum bidding period for certain sales of personal property by Internet auction. 604

Special improvement districts. 604

Authority of special improvement districts to undertake special energy improvement
projects. 606

Discounts or reductions on water and sewer service for certain persons 65 years of age
or older 609

Enterprise zone agreements. 609

County land reutilization corporations. 610

Convention facilities authority. 610

Clerk of courts titling fees. 611

Limitation on state and political subdivision use of Internet reverse auctions. 611

Changes in certain fees charged by a sheriff and by a law enforcement agency for
accident reports. 612

Sheriff's fees. 612

Accident report fees (PARTIALLY VETOED) 612

Satisfaction of multiple publication requirements through Internet postings (VETOED) 613

Commercial advertisements on county web sites (VETOED) 614

Mandatory cost savings program for county exempt employees. 615

Authority for municipal corporations to make loans to their residents so that they can
install solar panels in their homes. 616

Port authority plan for future development 617

Township authority to initiate a civil action to abate a public nuisance. 620

County zoning of small wind farms. 620

Ohio Commission on Local Government Reform and Collaboration. 621

 

STATE LOTTERY COMMISSION (LOT) 622

Authority of State Lottery Commission to conduct video lottery terminal games. 622

Transfer of a horse-racing permit 624

Political contribution issues. 624

 

MANUFACTURED HOMES COMMISSION (MHC) 624

Manufactured housing dealers, brokers, and salespersons. 625

Licensure. 625

Regulation. 626

Compliance with installation and other standards. 628

Application for certificate of title of a manufactured or mobile home. 628

 

MEDICAL BOARD (MED) 629

Licensure verification. 630

Certificate duplication. 630

Voucher approval 630

 

MEDICAL TRANSPORTATION BOARD (AMB) 630

Ambulette licensure. 631

 

DEPARTMENT OF MENTAL HEALTH (DMH) 631

ODMH purchasing program.. 633

Annual reports on use of state and federal funds for administrative functions. 633

Information systems maintained by ODMH and ODADAS.. 634

Community behavioral health services study. 635

Care coordination agency information. 636

Disclosure of hospital psychiatric records. 637

 

DEPARTMENT OF DEVELOPMENTAL DISABILITIES (DMR) 637

References to the Department and county boards. 639

ODODD and ODJFS Administration and Oversight Funds. 640

Residential facility exemption from development approval 640

Licensure issues. 640

Medicaid issues. 642

County DD board levy failure. 642

Identity disclosure--county DD programs. 644

County DD board business and Medicaid services managers. 644

Individual service plan summary page. 645

Fiscal plan for home and community-based Medicaid waiver services. 646

County share of Medicaid home and community-based services. 646

Developmental center services. 647

 

COMMISSION ON MINORITY HEALTH (MIH) 647

Commission membership. 647

 

DEPARTMENT OF NATURAL RESOURCES (DNR) 648

Reorganization of certain divisions. 651

General organization. 651

Renaming of the Division of Soil and Water Conservation; transfer of duties to
renamed Division. 652

Abolishment of the Division of Water and transfer of its duties. 652

Abolishment of the Division of Real Estate and Land Management and transfer of
its duties. 652

Duties of the Director of Natural Resources. 652

Duties of the Chief Engineer 653

Miscellaneous. 653

Transfer of state programs for wild, scenic, and recreational river areas. 653

Administration of wild, scenic, and recreational river areas. 653

Declaration of wild, scenic, and recreational river areas. 655

Natural Areas and Preserves Fund; Waterways Safety Fund. 656

Scenic Rivers Protection Fund. 656

Watercraft officers to enforce laws governing wild, scenic, and recreational river
areas. 656

Wild, scenic, and recreational river area advisory councils. 657

Waterways Safety Council 657

Participation in federal programs for protection of certain selected rivers and regarding
certain other waters. 657

Duties of Division of Watercraft 658

Fees for watercraft and livery registrations. 658

Well log filing fees. 659

Annual dam inspection fee and compliant dam discount program.. 660

Deer and wild turkey hunting. 661

"Ohio Nature Preserves" license plate and the Ohio Nature Preserves Fund. 661

Donations of venison by Farmers and Hunters Feeding the Hungry. 662

Sale of Marietta State Nursery land. 663

 

STATE BOARD OF PHARMACY (PRX) 664

Drug repository program--acceptance of certain cancer drugs. 664

Background. 664

Cancer drugs. 665

Qualified pharmacy technicians. 666

Timeframes to meet qualified technician criteria. 666

Examination materials. 666

Pharmacy technician--cross-reference corrections. 666

 

OCCUPATIONAL THERAPY, PHYSICAL THERAPY, AND ATHLETIC TRAINERS
BOARD (PYT)
667

Occupational therapist fees. 667

 

PUBLIC DEFENDER COMMISSION (PUB) 668

Indigent Defense Support Fund. 668

 

DEPARTMENT OF PUBLIC SAFETY (DPS) 669

Reclassification of traffic law violations. 671

Driver's license violations. 672

Vehicle equipment and other violations (PARTIALLY VETOED) 673

Driver's license vision screening fee. 675

State Highway Safety Fund. 675

Registration exemption for certain all-purpose vehicles. 675

Affidavit of ownership when obtaining a certificate of registration for certain off-highway motorcycles and all-purpose vehicles. 676

Identifying markers for snowmobiles and off-highway motorcycles. 676

Addition of snowmobiles and off-highway motorcycles to the enhanced penalty provisions
of the trespassing statute. 677

Operation of snowmobiles, off-highway motorcycles, and all-purpose vehicles by minors
on state-controlled land under DNR jurisdiction. 678

Multi-year registration of motor vehicles. 678

Commercial trailers and semitrailers. 678

Multi-year vehicle registration stickers. 679

Effects of not completing annual continuing professional training by peace officers and
troopers. 679

Operation of small three-wheel motorcycles. 680

Voluntary donation to Rehabilitation Services Commission from applicants for license
plates and placards for the walking-impaired. 680

Online commercial fleet licensing and management program.. 681

Fees for certain special and replacement license plates. 681

Fees for field or initial reserve and personalized license plates. 681

Fees for replacement license plates. 682

Temporary license placard fees. 683

Driver's license fees and disabled veterans. 683

Certificates of accreditation and certificates of approval 684

 

"Combat infantryman badge" license plate. 686

Angle parking on state routes within municipal corporations (VETOED) 687

 

PUBLIC UTILITIES COMMISSION (PUC) 687

Radioactive shipment inspections (PARTIALLY VETOED) 688

 

BOARD OF REGENTS (BOR) 689

Ohio College Opportunity Grants (OCOG) 692

Fiscal years 2010 and 2011. 692

Codified provisions. 694

Student Choice Grants. 696

Choose Ohio First Scholarships and Ohio Research Scholars programs. 696

Background. 696

Award criteria. 696

Scholarship amounts. 697

Participation of private institutions. 697

Nonprofit education loan secondary market operation. 697

Nurse Education Assistance Loan Program.. 698

Cap on undergraduate tuition increases. 698

Resident tuition rates for members of the Ohio National Guard. 699

Employee furloughs at public colleges and universities. 699

Central State University. 699

Rio Grande Community College. 699

University System of Ohio. 700

College transfer policies. 700

Eastern Gateway Community College District 701

Taxes and bonds. 701

Tuition for Columbiana, Mahoning, and Trumbull county residents. 701

Trustees' voting powers. 702

Board of trustees membership. 702

Conversion to state community college. 702

Entrepreneurial projects. 703

Purpose and methods of developing entrepreneurial projects. 703

Applicability of bond proceeding law to entrepreneurial projects. 704

Community and Technical College Bond Intercept Program.. 704

Intercept agreements. 704

Issuance of bonds by the Ohio Building Authority. 706

Obligations not a debt of the state. 708

Water and energy conservation measures. 708

Water conservation measures. 709

Energy conservation measures. 711

 

DEPARTMENT OF REHABILITATION AND CORRECTION (DRC) 713

Pilot project for the contractual provision of health care services to inmates of state
correctional facilities (VETOED) 713

Intensive program prisons. 714

Smoking and other tobacco-related activities in prisons. 715

 

REHABILITATION SERVICES COMMISSION (RSC) 715

Rehabilitation Services Commission funding. 716

 

RETIREMENT (RET) 717

Removal of Unemployment Compensation Advisory Council Members from the Public Employees Retirement System.. 719

PERS retirement incentive plans. 719

SHPRS contribution rates. 720

Deferred Compensation Program for public employees. 721

Access to records. 721

New employees. 722

Miscellaneous changes. 723

 

SCHOOL FACILITIES COMMISSION (SFC) 723

Background:  school facilities assistance programs. 724

Temporary extension of deadline to raise local share of a CFAP project 725

Adjustment of local share for certain CFAP projects. 725

Accounting for reductions in tangible personal property valuation (VETOED) 726

Priority for CFAP for Expedited Local Partnership districts. 727

Maintenance tax for Accelerated Urban districts. 727

Eligibility for Exceptional Needs Program.. 728

Local share under the Environmental Contamination Program.. 728

Qualified school construction bond allocations. 729

Background--federal authorization. 729

The act 729

Consideration of school district income tax levies allocated for school facilities projects. 730

JVSD funding source for OSFC-aided project 730

Advice on effect of new spending and reporting standards. 731

Survey of shared community spaces. 731

 

SECRETARY OF STATE (SOS) 732

Acquisition of voting machines, marking devices, and automatic tabulating equipment;
County Voting Machine Revolving Lease/Loan Fund. 733

Use of Ohio Building Authority bond proceeds for specified election equipment;
designation of boards of elections as state agencies. 733

County Voting Machine Revolving Lease/Loan Fund. 733

County lease of voting equipment acquired through the fund. 734

Adoption of rules. 735

Board of Elections Reimbursement and Education Fund. 735

Statewide Ballot Advertising Fund. 735

 

BOARD OF TAX APPEALS (BTA) 736

Board of Tax Appeals notices. 736

 

DEPARTMENT OF TAXATION (TAX) 736

I.  Property Tax. 743

School district conversion levies. 743

H.B. 920 limitation and 20-mill floor 744

Levy adoption procedure. 745

Revenue loss and reimbursement 745

Business personal property tax loss reimbursement 746

Permanent reimbursement for tangible personal property tax phase-out 747

School district reimbursement changes (VETOED) 748

Local taxing unit reimbursement changes (VETOED) 748

Reimbursement for county administrative fee losses (VETOED) 749

Property tax administration fund. 749

Manufactured home tax reduction reimbursement 750

Homestead exemption:  reimbursement of county auditors. 750

Exemption:  port authority. 751

School district property tax to offset funding formula charge-off increases. 751

II.  Sales and Excise Taxes. 752

Kilowatt-hour tax for self assessing purchasers. 752

Taxation of Medicaid health insurance companies. 753

Insurance corporation franchise tax. 753

Sales tax. 753

Impermissible health care-related tax. 754

Cigarette and tobacco dealer licensing. 754

License fees. 754

Fee distribution. 755

Natural gas distribution tax. 756

Lodging tax for convention facilities authority. 757

Lodging tax. 757

Salt severance tax revenue. 758

III.  Tax Credits. 758

New Markets Tax Credit 758

Federal credit 759

Ohio credit 759

Recapture; rule-making. 761

Technology investment tax credit increase. 761

Job retention tax credit 762

Credit base. 762

Eligible business. 762

Related member 763

Applicable taxpayers. 763

Credit limits. 763

Tax credit agreement 764

Agreement noncompliance. 765

Director's report 765

Additional credit for call centers. 766

Job creation tax credit 766

Credit base. 766

Tax credit agreement 767

Agreement noncompliance. 768

Director's report 769

Movie and television production tax credit 769

Credit amount; overall limit 769

Eligible productions and expenditures. 769

Application for production certification and credit certificate. 770

Examination of expenditures. 771

Credit certificate. 771

Administrative rules. 772

Motion Picture Tax Credit Program Operating Fund. 772

Use of state's name in credits. 772

Historic rehabilitation tax credit 772

IV.  Commercial Activity Tax. 773

Penalty:  billing or invoicing for the tax. 773

Personal property tax reimbursement 773

Tax Reform System Implementation Fund. 774

Excluded persons and taxable gross receipts. 774

Registration and fee. 775

Consolidated elected taxpayer group. 776

Combined taxpayer group. 777

Tax periods. 777

V.  Income Taxes. 778

Income tax petition for reassessment 778

School district income tax. 779

Municipal income taxation of justices and judges. 779

VI.  Miscellaneous Tax Provisions. 780

Incorporation of changes to the Internal Revenue Code. 780

Service of tax-related notices and orders. 781

Use of DTAC Fund for Foreclosure Prevention, Nuisance Abatement 783

Disclosure of information:  employer compliance. 784

Forfeiture proceeds of Department of Taxation. 784

 

DEPARTMENT OF TRANSPORTATION (DOT) 785

Division and Deputy Director of Equal Employment Opportunity in the Department of Transportation  785

Curb cut on State Route 91 (VETOED) 785

 

TUITION TRUST AUTHORITY (TTA) 785

Background. 786

Administrative restructuring. 787

Ohio Tuition Trust Authority Board. 787

Board powers and duties. 788

New guaranteed programs; study. 789

Background--constitutional pledge of state's full faith and credit 789

The act 789

Study. 789

Investment contractors. 790

 

OHIO TURNPIKE COMMISSION (TPC) 790

Major maintenance and repair and replacement at grade separations of the Ohio Turnpike
and county and township roads (VETOED) 790

 

DEPARTMENT OF VETERANS SERVICES (DVS) 791

Purchasing without competitive selection or Controlling Board approval 791

 

DEPARTMENT OF YOUTH SERVICES (DYS) 791

County Felony Delinquent Care and Custody Fund. 792

 

MISCELLANEOUS (MSC) 793

Controlling Board authority to increase capital appropriations. 796

Disposition of Build America Bond payments by the state or local governments. 796

Government issued securities and obligations. 796

Public obligation:  definition. 796

Estimated interest rate of bonds. 797

Securities: payment of principal 797

Sources of funding securities. 797

Ohio Residential Building Code. 797

Adoption of the Ohio Residential Building Code. 798

Petitions for changes to the Ohio Residential Building Code. 799

Board of Building Standards. 799

Ohio Family and Children First Cabinet Council 801

Newspapers qualified for publication of legal notices--requirements (VETOED) 801

Reporting of preneed cemetery and preneed funeral contracts. 802

Budget Planning and Management Commission. 803

Protected public record status for investigators of the Bureau of Criminal Identification
and Investigation. 803

Minority and women-owned investment managers and agents. 804

Ohio Venture Capital Authority. 804

Annual report--minority or women-owned businesses. 804

Designation of August as "Ohio Military Family Month" 805

Ohio Legislative Commission on the Education and Preservation of State History. 805

Conveyance of state land in Butler County. 807

Jackson County land conveyance. 808

Land conveyance from state to Dayton Public Schools. 809

Hamilton County Land Conveyance. 810

 

·         Requires proceeds from the sale or lease of vacated armories and other facilities and land owned by the Adjutant General to be deposited into the Armory Improvements Fund and used to support Ohio Army National Guard facility and maintenance expenses as the Adjutant General directs.

·         Requires Controlling Board approval for any Armory Improvements Fund expenditure related to the construction, acquisition, lease, or financing of a capital asset.

·         Creates in the state treasury the Community Match Armories Fund to consist of all amounts received as revenue from contributions from local entities for construction and maintenance of Ohio Army National Guard readiness and community centers and facilities.

·         Requires the moneys in the Community Match Armories Fund to be used to support the acquisition and maintenance costs of centers and facilities representing the local entity's share of costs, including the local entity's share of utility costs.

·         Creates in the state treasury the Camp Perry/Buckeye Inn Operations Fund that consists of all amounts received as revenue from the rental of the Camp Perry and Buckeye Inn facilities and from the use of the Camp Perry facility.

·         Requires the Camp Perry/Buckeye Inn Operations Fund to be used to support the facility operations of the Camp Perry Clubhouse and the Buckeye Inn.

·         Creates the National Guard Service Medal Fund in the state treasury to consist of all amounts received from the purchase of Ohio National Guard service medals for eligible National Guard service members as authorized by the General Assembly, and requires moneys in the fund to be used to purchase additional medals.

·         Creates in the state treasury the Ohio National Guard Facility Maintenance Fund consisting of all amounts received from leases of sites, including towers and wells, and from other revenue from reimbursements for services related to Ohio National Guard programs.

·         Requires Ohio National Guard Facility Maintenance Fund moneys to be used for service, maintenance, and repair expenses, and for equipment purchases for programs and facilities of the Adjutant General.

·         Permits the Adjutant General to appoint an assistant Adjutant General-Army and an assistant Adjutant General-Air Force who must meet the qualifications established by the Department of Defense for general officer qualification.

·         Increases the number of participants in the Ohio National Guard Scholarship Program for the 2009 summer term from the equivalent of 800 full-time participants to the equivalent of 1,200 full-time participants.

·         Repeals a provision that, upon receipt of a certification from the Administrator of the Bureau of Workers' Compensation, requires the Adjutant General to request the amount certified from the Controlling Board and to request the Director of Budget and Management to provide for payment to the State Insurance Fund of a sum equal to the amount transferred by the Controlling Board.

 

 

Ohio Army National Guard facility and maintenance expenses

(R.C. 5911.10)

If any armory erected or purchased by the state becomes vacant because of deactivation, the Governor and the Adjutant General can lease it for periods not to exceed one year; or, when authorized by an act of the General Assembly, can sell or lease it for a period of years.  The proceeds from the sale or lease of the armory must be credited to the Armory Improvements Fund, which is in the state treasury.  The act specifies that the proceeds from the sale or lease of other facilities and land owned by the Adjutant General also must be credited to the Armory Improvements Fund.

The act specifies further that moneys in the Armory Improvements Fund must be used to support Ohio Army National Guard facility and maintenance expenses as the Adjutant General directs.  Any fund expenditure related to the construction, acquisition, lease, or financing of a capital asset is subject to Controlling Board approval.  Investment earnings of the fund are credited to the General Revenue Fund.

Community Match Armories Fund

(R.C. 5911.11)

The act creates the Community Match Armories Fund in the state treasury.  The fund consists of all amounts received as revenue from contributions from local entities for the construction and maintenance of Ohio Army National Guard readiness and community centers and facilities.  The moneys in the fund must be used to support the acquisition and maintenance costs of centers and facilities representing the local entity's share of costs, including the local entity's share of utility costs.  Investment earnings of the fund are credited to the fund.

Camp Perry/Buckeye Inn Operations Fund

(R.C. 5913.09)

The Adjutant General is the custodian of all military and other Adjutant General's Department property, both real and personal, belonging to the state.  Generally, all income from any military or other Adjutant General's Department property, not made a portion of the company, troop, battery, detachment, squadron, or other organization funds by regulations, must be credited to the funds for the operation and maintenance of the Ohio organized militia, as the Adjutant General directs, in accordance with applicable laws, regulations, and agreements.

The act creates in the state treasury the Camp Perry/Buckeye Inn Operations Fund.  The fund consists of all amounts received as revenue from the rental of facilities located at the Camp Perry training site in Ottawa County and the Buckeye Inn at Rickenbacker Air National Guard base in Franklin County, and all amounts received from the use of the Camp Perry training site and its facilities, including shooting ranges.  The moneys in the fund are used to support the facility operations of the Camp Perry Clubhouse and the Buckeye Inn.  Investment earnings of the fund are credited to the General Revenue Fund.

National Guard Service Medal Fund

(R.C. 5919.20)

The act creates the National Guard Service Medal Fund in the state treasury.  The fund consists of all amounts received from the purchase of Ohio National Guard service medals for eligible National Guard service members as authorized by the General Assembly.  The moneys in the fund must be used to purchase additional medals.  Investment earnings of the fund are credited to the fund.

Ohio National Guard Facility Maintenance Fund

(R.C. 5919.36)

The act creates in the state treasury the Ohio National Guard Facility Maintenance Fund.  The fund consists of all amounts received from revenue from leases of sites, including towers and wells, and other revenue received from reimbursements for services related to Ohio National Guard programs.  The moneys in the fund must be used for service, maintenance, and repair expenses, and for equipment purchases for programs and facilities of the Adjutant General.  Investment earnings of the fund are credited to the General Revenue Fund.

Assistant Adjutant General-Army and Air Force

(R.C. 5913.051)

To supplement the military staff of the Governor, the Adjutant General can appoint an assistant to the state area commander for readiness and training for Army.  The assistant ranks as a brigadier general and is to aid the Adjutant General by performing assigned duties in the areas of readiness, training, and mobilization.  The assistant is not a full-time state employee, but only serves in that capacity during federally recognized training, special duty periods, or mobilization periods.  The assistant must at the time of appointment be in the rank of colonel or above and otherwise meet other relevant qualifications.

Under the act, the Adjutant General can appoint two assistant Adjutant Generals:  an assistant Adjutant General-Army and an assistant Adjutant General-Air Force.  The assistants rank as brigadier generals and are to aid the Adjutant General by performing assigned duties that include the areas of readiness, mobilization, and homeland defense preparedness.  The assistants are not full-time state employees or members of the Governor's military staff, but only serve in that capacity during federally recognized training, special duty periods, mobilization periods, or state active duty.  The assistants must at the time of appointment be in the rank of colonel or above but otherwise meet the qualifications established by the Department of Defense/Army or Department of Defense/Air Force, as the case may be, for general officer qualification.

Ohio National Guard Scholarship Program

(R.C. 5919.34, not in the act; Section 759.10)

Continuing law creates the Ohio National Guard Scholarship Program, which provides financial assistance to eligible Ohio National Guard members to attend institutions of higher education.  That law generally limits the number of participants in the Program for the summer academic term to the equivalent of 800 full-time participants.

The act carves out, in a special law, an exception to that limitation by increasing, for the summer academic term in 2009, the limit on the number of participants to the equivalent of 1,200 full-time participants.

Payment of Adjutant General's workers' compensation costs

(R.C. 5923.141)

Under former law, upon receipt of a certification from the Administrator of the Bureau of Workers' Compensation, the Adjutant General was required (1) to request the amount certified from the Controlling Board and (2) to request the Director of Budget and Management to provide for payment to the State Insurance Fund of a sum equal to the amount transferred by the Controlling Board.  The act repeals this provision.

 

·         Expands the powers of the Department of Administrative Services by authorizing the Department to lease any space, not just office space, for use by a state agency.

·         Requires the Director of Administrative Services to administer a state equal employment opportunity program.

·         Specifies that the Director's authority to enter into agreements with political subdivisions to furnish the Department's services and facilities in the administration of a merit program and other functions related to human resources includes counties and also includes, but is not limited to, administering competitive examinations for persons in the classified civil service.

·         Requires counties that do not have a county personnel department and that use county job classification plans established by the Director to pay a usage fee in an amount the Director determines, with these fees being paid into the Human Resources Fund.

·         Limits the Department's supervision of county personnel departments.

·         Makes the Department generally responsible for administering civil service examinations only for positions in the classified civil service of the state.

·         Changes effective August 30, 2009, the amount of service required of the following state employees before they accrue specific amounts of vacation leave:  (1) exempt employees, (2) legislative employees, (3) Supreme Court employees, (4) certain employees in the office of the Governor, Secretary of State, Auditor of State, Treasurer of State, and Attorney General, and (5) employees in any position for which authority to determine compensation is given by law to an individual or entity other than the Director of Administrative Services.

·         Provides that employees may begin using their vacation leave upon completing their initial probationary period.

·         Prohibits during fiscal years 2010 and 2011, and limits to 80 hours beginning in fiscal year 2012, payments made for accrued vacation leave in the situation where a state employee has been denied vacation leave and is at the maximum amount of vacation leave that the employee may accrue.

·         Grants in July 2011 to a state employee who is paid by warrant of the Director of Budget and Management a one-time credit of additional sick leave equal to (1) 16 hours if the employee is a part-time employee or (2) if the employee is a full-time employee, the lesser of either 32 hours or one-half of the personal leave hours the employee lost as a result of the moratoria on the crediting and annual payment of personal leave in effect from December 2009 until December 2011 under either the applicable Revised Code section or a rule of the Director of Administrative Services.

·         Does not grant the sick leave credit described above to employees of the Supreme Court, General Assembly, Legislative Service Commission, Secretary of State, Auditor of State, Treasurer of State, or Attorney General unless these employees were subject to the moratoria on the accrual and annual payment of personal leave in effect from December 2009 until December 2011.

·         Imposes moratoria, from December 2009 through December 2011, on (1) the accrual of personal leave by certain state employees and (2) the annual conversion of accrued but unused personal leave by these employees.

·         Provides that the moratoria on personal leave described above (1) apply to employees of the Secretary of State, Auditor of State, Treasurer of State, and Attorney General unless the Secretary of State, Auditor of State, Treasurer of State, or Attorney General decides to exempt the officer's employees and so notifies the Director of Administrative Services in writing on or before November 1, 2009, and (2) do not apply to employees of the Supreme Court, General Assembly, and Legislative Service Commission unless the Supreme Court, General Assembly, or Legislative Service Commission decides to include those employees in the moratoria and so notifies the Director in writing on or before November 1, 2009.

·         Grants in August 2011 to a state employee who is eligible to receive personal leave a one-time pay supplement (1) equivalent to 16 hours of personal leave if the employee is a part-time employee or (2) if the employee is a full-time employee, the lesser of either a one-time pay supplement equivalent to 32 hours of personal leave or one-half the hours of personal leave the employee lost as a result of the moratoria on the crediting and annual payment of personal leave that was in effect from December 2009 until December 2011 under either the applicable Revised Code section or a rule of the Director of Administrative Services.

·         Does not grant the pay supplement described above to employees of the Supreme Court, General Assembly, Legislative Service Commission, Secretary of State, Auditor of State, Treasurer of State, or Attorney General unless these employees were subject to the moratoria on the accrual and annual payment of personal leave in effect from December 2009 until December 2011 and the Supreme Court, General Assembly, Legislative Service Commission, Secretary of State, Auditor of State, Treasurer of State, or Attorney General decides to participate in the pay supplement.

·         Allows an employee paid by warrant of the Director of Budget and Management to use available compensatory leave balances to supplement disability leave payments.[1]

·         Requires that when a state employee is on approved disability leave, the employee must pay the employee's share of retirement contributions instead of the state paying the employee's share after the first three months of disability as required by prior law.

·         Creates for employees in state service salary continuation not to exceed 480 hours at their total rate of pay for injuries incurred during the performance of, and arising out of, state employment after an implementation date determined by rule of the Director of Administrative Services.

·         Modifies the occupational injury leave program.

·         Eliminates pay supplements and probationary periods for intermittent employees.[2]

·         Specifies that rules of the Department governing employee layoffs apply to only employees in the service of the state.

·         Eliminates the requirement that appointing authorities of employees not paid by warrant of the Director of Budget and Management file a statement of rationale and supporting documentation with the Director of Administrative Services before sending a layoff notice.

·         Requires the Director to verify the calculation of layoff retention points for only employees in the service of the state.

·         Provides that the Director's rules governing layoff displacement rights apply to only employees in the service of the state.

·         Requires the Director to verify retention points to reflect the length of continuous service and efficiency in service for only those employees who are laid off from positions in the service of the state.

·         Requires, during fiscal years 2010 and 2011, that all full-time exempt state employees participate in a total of 80 hours of mandatory cost savings through a loss of pay or holiday pay and that all part-time employees not receive holiday pay.[3]

·         Requires participation in the cost savings program described above by all employees of the Secretary of State, Auditor of State, Treasurer of State, or Attorney General unless the Secretary of State, Auditor of State, Treasurer of State, or Attorney General chooses to exempt the office's employees and so notifies the Director of Administrative Services in writing on or before July 1, 2009.[4]

·         Specifies that if the Secretary of State, Auditor of State, Treasurer of State, or Attorney General did not opt to participate in the mandatory cost savings program by July 1, 2009, the Secretary of State, Auditor of State, Treasurer of State, or Attorney General may begin participating in the program for 80 hours or less by notifying the Director of Administrative Services in writing.

·         Authorizes the Director of Administrative Services, after June 30, 2011, to implement mandatory cost savings days for exempt employees in the event of a fiscal emergency.[5]

·         Requires participation in mandatory cost savings days by all employees of the Secretary of State, Auditor of State, Treasurer of State, or Attorney General unless the Secretary of State, Auditor of State, Treasurer of State, or Attorney General chooses to exempt the office's employees and notifies the Director of Administrative Services in the manner the Director prescribes by rule.[6]

·         Specifies that reductions in pay made as the result of mandatory cost savings days are not modifications or reductions in pay that an employee in the classified civil service can appeal to the State Personnel Board of Review under the Civil Service Law.[7]

·         Authorizes the Governor to declare a fiscal emergency if the Governor determines that the available revenue receipts and balances for any fund or across any funds will likely be less than the appropriations for the year, and to issue such orders as necessary to the Director of Budget and Management to reduce expenditures, or to the Director of Administrative Services to implement personnel actions consistent therewith, including, but not limited to, mandatory cost savings days.[8]

·         Creates the Cost Savings Fund and allocates to the Fund savings accrued through employee participation in the mandatory cost savings program and in mandatory cost savings days.[9]

·         Requires that an applicant for a civil service examination be a United States citizen or have a valid permanent resident card, rather than be a United States citizen or have declared the intention of becoming a United States citizen, as required under prior law.

·         Requires that certain disciplinary actions under prior law tied to 24 or 40 or more hours of work or pay instead be tied to more than 24 or 40 hours of work or pay.

·         Specifies that employee absences due to cost savings day provided by law or under a collective bargaining agreement must not be a factor in determining unemployment compensation eligibility or payment amount.

·         Requires a 2% pay reduction beginning in July 2009 for exempt employees of the Auditor of State paid in accordance with Schedule E-1 or Schedule E-1 for Step 7.

·         Creates the Health Care Spending Account Fund in the state treasury and requires the Director of Administrative Services to use the money in the fund to make payments with regard to the participation of state employees in flexible spending accounts for certain nonreimbursed medical and dental expenses under section 125 of the Internal Revenue Code.

·         Creates the Dependent Care Spending Account Fund in the state treasury and requires the Director to use money in the fund to make payments with regard to the participation of state employees in flexible spending accounts for work-related dependent care expenses under section 125 of the Internal Revenue Code.

·         Authorizes the Department to establish and obtain OBM approval of charges to cover state administrative costs for employee educational development programs undertaken pursuant to specific collective bargaining agreements identified in uncodified law and to request that OBM approve additional amounts for this purpose if it becomes necessary.

·         Requires the Department of Administrative Services to collect user fees from participants in the multi-agency radio communications system (MARCS).

·         Creates the MARCS Administration Fund in the state treasury and requires all moneys from user fees to be deposited in the fund.

·         Authorizes the Office of Collective Bargaining in the Department of Administrative Services to negotiate with the respective state collective bargaining units various payroll reduction strategies through the collective bargaining process prior to July 1, 2009, including, but not limited to, reductions in pay for fiscal years 2010 and 2011 and an increase in a state employee's share of dental, vision, and life insurance benefits during those fiscal years, to achieve savings of between $170 and $200 million for each fiscal year.

·         Authorizes the Director of Budget and Management to transfer cash from non-General Revenue Fund funds to the General Revenue Fund to carry out the provisions described in the preceding dot point.

·         States the General Assembly's intent that all funds appropriated or otherwise made available by the state for fiscal stabilization or recovery purposes or by the American Recovery and Reinvestment Act of 2009 are to be used, to the extent possible, in accordance with the preferences established in the state's Buy Ohio Law to purchase products made and services performed in the United States and Ohio.

·         Would have required at least four, instead of at least two, bids that offer products produced or mined in Ohio in order to be considered sufficient competition to prevent excessive price or inferior products when giving preference to Ohio-produced or mined products (VETOED).

·         Requires contractors for specified projects funded with at least $100,000 from a political subdivision to comply with regulations or ordinances of the political subdivision that are in effect before July 1, 2009, that specifically relate to the employment of residents and local businesses of the political subdivision in the performance of the work of the project.

·         Would, if left intact, have required the Director of Administrative Services to establish a single electronic Internet web site through which the following can be accessed:  a database containing each state employee's year-to-date gross pay and pay from the most recent pay period, a database containing agency expenditures for goods and services, and a database containing tax credits granted to business entities (PARTIALLY VETOED).

·         Would have required each database to contain searchable fields through which details about the subject of the database can be accessed (VETOED).

·         Requires the Department of Administrative Services to obtain group life insurance coverage for all municipal and county court judges.

·         Specifies that on and after the effective date of the life insurance coverage for municipal and county court judges, these judges are ineligible for life insurance coverage from any county or other political subdivision.

·         Removes obsolete pay tables prescribing pay for exempt employees.

·         Requires a state agency, by November 1, 2009, to prepare a spending plan outlining a 30% reduction in spending on supplies and services for fiscal years 2010 and 2011.

·         Requires a state agency, by February 1 of each odd-numbered year beginning in 2011, to prepare a spending plan for purchasing supplies and services for the following two fiscal years.

·         Requires state agencies to observe travel expense controls, overhead cost controls, furniture and equipment purchasing controls, and information technology controls.

·         Requires the State Chief Information Officer to establish policies and standards for consolidating information technology, for extending the service life of information technology systems, for the purchase and use of handheld computing and telecommunications devices by state agency employees, converting print to electronic records, and reducing energy consumption.

·         Requires the Director of Administrative Services to establish a State Information Technology Investment Board to identify and recommend to the State Chief Information Officer opportunities for consolidation and cost-saving measures relating to information technology.

·         Requires state agencies, state universities, and the Ohio Housing Finance Agency, the Third Frontier Commission, the Clean Ohio Council, and the Ohio School Facilities Commission to comply with a new uncodified statute modeled on Executive Order 2008-13S when complying with the minority set aside purchasing requirements of the Minority Business Enterprise Set Aside Act or with the procurement goals of the EDGE Business Enterprise Act.

·         Requires state agencies, including state universities, and the Ohio Housing Finance Agency, the Third Frontier Commission, the Clean Ohio Council, and the Ohio School Facilities Commission, that have failed to comply with the minority set aside purchasing requirements of the Minority Business Enterprise Set Aside Act, or with the procurement goals established under the EDGE Business Enterprise Act, to establish, by December 31, 2009, a long-term plan for compliance.

·         Explicitly requires that the Ohio School Facilities Commission, the Ohio Housing Finance Agency, the Third Frontier Commission, the Clean Ohio Council, and state universities purchase goods and services as required by the Minority Business Enterprise Set Aside Act and that the Ohio Housing Agency, the Third Frontier Commission, and the Clean Ohio Council comply with agency procurement goals for contracting with EDGE Business Enterprises.

·         Specifies that the rules of the Minority Business Bonding Program must provide for a retainage of money paid to a participating minority business or EDGE business enterprise of 15% for a contract valued at more than $50,000 and for a retainage of 12% for contracts valued at $50,000 or less.

·         Permits a minority business or EDGE business enterprise to bid or enter into a contract with the state, an instrumentality of the state, a political subdivision, or an instrumentality of a political subdivision without being required to provide a bond under specified circumstances.

·         Would have required the Department of Administrative Services to conduct a two-year pilot project in which a total of 10% of state-owned, gasoline-powered passenger cars, sport utility vehicles, and light-duty pickup trucks used by the Department of Natural Resources, Public Safety, and Transportation were to be converted to a propane fuel system, to assess all aspects of the use of propane-powered vehicles during the pilot project, and to submit a final report to the Governor and the General Assembly (VETOED).

 

 

Leasing space by Department of Administrative Services

(R.C. 123.01)

Under ongoing law, among the powers of the Department of Administrative Services, is the power to lease office space in buildings for the use of a state agency.  The act expands this power by authorizing the Department to lease any space, not just office space in buildings, for use by a state agency.

State Equal Employment Opportunity Program

(R.C. 124.04)

The act requires the Director of Administrative Services to administer a state equal employment opportunity program.

Department's agreements with political subdivisions to provide personnel services

(R.C. 124.07)

The Director of Administrative Services may enter into an agreement with any municipal corporation or other political subdivision to furnish services and facilities of the Department of Administrative Services in the administration of a merit program or other functions related to human resources.  The act specifies that the Director's authority to enter into these agreements explicitly includes counties and also includes, but is not limited to, providing competitive examinations for persons in the classified civil service.

All money the Department receives as a reimbursement for payroll, merit program, or other human resource services performed and facilities furnished to political subdivisions is paid into the state treasury to the credit of the Human Resources Services Fund.  The act removes the reference to payroll services and inserts a reference to the administration of competitive examinations as an example of human resource services performed.

Department's receipt of reimbursement for the use of its county job classification plans

(R.C. 124.14)

Under prior law, the Director of Administrative Services was required, in accordance with rules adopted under the Administrative Procedure Act, to establish a classification plan for county agencies that do not use the services and facilities of a county personnel department.  The act instead merely authorizes the Director to do so and authorizes the Director to assess a county agency that chooses to use the Director's classification plan a usage fee the Director determines.  All usage fees must be paid into the state treasury to the credit of the Human Resources Fund.

Department's supervision of county personnel departments

(R.C. 124.14)

Each board of county commissioners is authorized to establish a county personnel department and vest administration of the Civil Service Law in the department, in place of administration of the county civil service by the Department of Administrative Services.  The act eliminates a requirement that the county personnel department's exercise of this power only begins upon the receipt by the Director of Administrative  Services of a copy of the board of county commissioners' resolution vesting this power in the county personnel department.

After a county personnel department has been vested with the power to administer the Civil Service Law, any county elected official, board, agency, or other appointing authority, upon written notification to the Director, may elect to use the services and facilities of the county personnel department.  The act provides that upon the county personnel department's receipt of this notification, rather than upon the Director's receipt, the county personnel department must begin to administer the Civil Service Law with respect to that county agency.

After at least two years have passed since the creation of a county personnel department, the board of county commissioners may disband the county personnel department.  The act eliminates (1) the requirement for the county personnel department to have existed for at least two years before it can be disbanded and (2) the return of administration of the Civil Service Law to the Department of Administrative Services if the county personnel department is disbanded.

A county agency, when at least two years have passed since it elected to use the services and facilities of a county personnel department, may return to the Department of Administrative Services for administration of the Civil Service Law.  The act instead (1) provides that a county agency may end its involvement with a county personnel department at any time upon the county personnel department's actual receipt of a certified copy of the agency's notification of the agency's decision to no longer participate and (2) eliminates the return of administration of the Civil Service Law to the Department of Administrative Services with respect to that county agency.

The act authorizes, rather than requires as under prior law, the Director of Administrative Services to adopt rules in accordance with the Administrative Procedure Act that (1) require each county personnel department to adhere to merit system principles with regard to employees of the county departments of job and family services, child support enforcement agencies, and public child welfare agencies so that there is no threatened loss of federal funding for these agencies and to be financially liable to the state for any loss of federal funds due to the action or inaction of the county personnel department and (2) authorize the Director of Administrative Services to conduct periodic audits and reviews of county personnel departments to guarantee uniform application of the Civil Service Law.  Under the act, the costs of audits and reviews conducted to monitor the county personnel department's administration of the Civil Service Law are to be reimbursed to the Department of Administrative Services as determined by the Director, rather than be borne equally between the Department and the county personnel department as required by prior law.  All money the Department receives for these audits must be paid into the state treasury to the credit of the Human Resources Fund.

The net effect of these changes is that county agencies themselves, or the county personnel department to the extent that county agencies come under its jurisdiction, are primarily responsible for administration of the Civil Service Law in the county, subject to oversight by the Department of Administrative Services to ensure that (1) the Civil Service Law is being uniformly administered and (2) merit system standards are being properly followed to avoid the loss of federal funds for certain federally funded county agencies.

Department's responsibility for administering examinations for positions in the service of the state

(R.C. 124.23)

Any civil service examination must be public and open to all United States citizens and persons who have legally declared their intentions of becoming citizens, within certain limitations to be determined by the Director of Administrative Services as to citizenship, age, experience, health, habit, and moral character.  The act specifies that the Director may determine these limitations only for examinations that are to be administered for positions in the service of the state, which are positions in the government of the state not including  positions of employment with state-supported colleges and universities, counties, cities, city health districts, city school districts, general health districts, and civil service townships.

Under prior law, the Director had control of all civil service examinations.  The act specifies instead that the Director has control over all examinations administered for positions in the service of the state and all other examinations the Director administers under contract with political subdivisions.

Prior law also generally required the Director to give reasonable notice of the time, place, and general scope of every competitive examination for appointment to a position in the civil service.  The act limits this notice to examinations the Director conducts for positions in the service of the state.

Changes in amount of annual vacation leave accrued by certain state employees

(R.C. 124.134; Sections 803.30 and 812.20)

The act, effective August 30, 2009, changes the amount of service required of the following state employees before they accrue specific amounts of vacation leave with full pay:  (1) exempt employees, (2) legislative employees, (3) Supreme Court employees, (4) certain employees in the office of the Governor, Secretary of State, Auditor of State, Treasurer of State, Attorney General, and (5) employees in any position for which authority to determine compensation is given by law to an individual or entity other than the Director of Administrative Services.  These employees will accrue 120, 160, 180, 200, or 240 hours of vacation each year if they have accrued 4, 9, 14, 19, or 24 years of service respectively, rather than 5, 10, 15, 20, or 25 years of service as required by prior law.  Employees with less than four years of service will accrue 80 hours of leave per year, but may begin using their accrued leave upon completion of their initial probation period.  However, a probationary period that follows a separation from service that is less than 31 days is not considered an initial probationary period.  The act provides that 52 weeks equal one year of service, rather than 26 biweekly pay periods as under prior law.  These changes take effect on August 30, 2009.

The act requires the Director of Administrative Services to determine an additional prorated amount of vacation leave for employees who are in their 4th, 9th, 14th, 19th, or 24th year of service to receive as a result of the transition occurring on August 30, 2009.  This additional, prorated amount must be such that the affected employees are not harmed as a result of the transition, and must be added to the vacation leave balances of the affected employees on that date.

Payment for denied vacation leave

(R.C. 124.134)

Those state employees described in the immediately preceding section of this analysis can be paid for their accrued vacation leave if they have been denied vacation leave during the immediately preceding 12 months and their vacation leave is at, or will reach in the immediately following pay period,  the maximum amount that they may accrue, which is three times the amount of vacation leave they accrue per year based on their length of service.  The act prohibits these payments from being made during fiscal years 2010 and 2011, but allows them to be made up to a maximum of 80 hours per fiscal year beginning in fiscal year 2012.

The act also authorizes the Supreme Court, General Assembly, Secretary of State, Auditor of State, Treasurer of State, and Attorney General to establish by policy an alternative payment structure for their employees whose vacation leave credit is at, or will reach in the immediately following pay period, the maximum accrual of three years and who have been denied the use of vacation leave.

Grant of additional sick leave credit to state employees in July 2011

(R.C. 124.382)

The act grants to state employees who are paid by warrant of the Director of Budget and Management and who are in active payroll status on June 18, 2011, a one-time credit of additional sick leave in the pay period that begins on July 1, 2011.  Part-time employees receive a one-time sick leave credit equal to 16 hours of additional sick leave.  Full-time employees receive the lesser of either a one-time sick leave credit of 32 hours of additional sick leave or a one-time credit of additional sick leave equivalent to one-half of the personal leave hours the employee lost as a result of the moratoria on the crediting and annual payment of personal leave in effect from December 2009 until December 2011 under either the applicable Revised Code section or a rule of the Director of Administrative Services.

Employees who are not in active payroll status due to military leave or absence taken in accordance with the federal Family and Medical Leave Act are eligible to receive the additional one-time sick leave credit.  "Active payroll" status means conditions under which an employee is in active pay status or is eligible to receive pay for an approved leave of absence including, but not limited to, occupational injury leave, disability leave, or workers' compensation.

The act does not grant the additional one-time sick leave credit to employees of the Supreme Court, General Assembly, Legislative Service Commission, Secretary of State, Auditor of State, Treasurer of State, or Attorney General unless these employees were subject to the moratoria on the accrual and annual payment of personal leave in effect from December 2009 until December 2011 and the Supreme Court, General Assembly, Legislative Service Commission, Secretary of State, Auditor of State, Treasurer of State, or Attorney General notifies the Director of Administrative Services in writing on or before June 1, 2011, of the decision to participate in the one-time additional sick leave credit.  Written notice must be signed by the appointing authority for employees of the Supreme Court, General Assembly, or Legislative Service Commission, as the case may be.

Moratoria on the accrual and annual payment of personal leave

(R.C. 124.386)

Continuing law provides 32 hours of personal leave each year to the following state employees:  (1) exempt employees, (2) legislative employees, (3) Supreme Court employees, (4) certain employees in the office of the Governor, Secretary of State, Auditor of State, Treasurer of State, and Attorney General, and (5) employees in any position for which authority to determine compensation is given by law to another individual or entity.  Employees who receive personal leave are allowed to (1) carry forward their balance to the next year, (2) convert the balance to sick leave, or (3) be paid for the value of their balance.  The act imposes moratoria, from December 2009 until December 2011, on the accrual of personal leave by these employees and on the annual conversion of their accrued but unused personal leave.  The act provides that personal leave accrual will resume with employees receiving credit in December 2011, but with no retroactive grant of credit for the period the moratoria were in effect.

The act further provides that the moratoria described above apply to employees of the Secretary of State, Auditor of State, Treasurer of State, and Attorney General unless the Secretary of State, Auditor of State, Treasurer of State, or Attorney General decides to exempt the office's employees and so notifies the Director of Administrative Services in writing on or before November 1, 2009.  The moratoria described above do not apply to employees of the Supreme Court, General Assembly, and Legislative Service Commission unless the Supreme Court, General Assembly, or Legislative Service Commission decides to include their employees in the moratoria and so notify the Director of Administrative Services in writing on or before November 1, 2009.  The written notice must be signed by the appointing authority for employees of the Supreme Court, General Assembly, or Legislative Service Commission.

One-time pay supplement in August 2011 to state employees paid by warrant of the Director of Budget and Management

(R.C. 124.183)

The act grants to those state employees who are eligible to receive personal leave and who are in active payroll status on July 30, 2011, a one-time pay supplement in the earnings statements they receive on August 26, 2011.  Part-time employees receive a one-time pay supplement equivalent to 16 hours of personal leave.  Full-time employees receive the lesser of either a one-time pay supplement equivalent to 32 hours of personal leave or a one-time pay supplement of one-half the hours of personal leave hours the employee lost as a result of the moratoria on the crediting and annual payment of personal leave that was in effect from December 2009 until December 2011 under either the applicable Revised Code section or a rule of the Director of Administrative Services.

Employees who are not in active payroll status on July 30, 2011, due to military leave or absence taken in accordance with the federal Family and Medical Leave Act are eligible to receive this additional one-time pay supplement.  "Active payroll" status means conditions under which an employee is in active pay status or is eligible to receive pay for an approved leave of absence including, but not limited to, occupational injury leave, disability leave, or workers' compensation.

The act does not grant the additional one-time pay supplement described above to employees of the Supreme Court, General Assembly, Legislative Service Commission, Secretary of State, Auditor of State, Treasurer of State, or Attorney General unless these employees were subject to the moratoria on the accrual and annual payment of personal leave that was in effect from December 2009 until December 2011 and the Supreme Court, General Assembly, Legislative Service Commission, Secretary of State, Auditor of State, Treasurer of State, or Attorney General notifies the Director of Administrative Services in writing before June 1, 2011, of the decision to participate in the one-time pay supplement.  Written notice must be signed by the appointing authority for employees of the Supreme Court, General Assembly, or Legislative Service Commission, as the case may be.

Use of compensatory time balance to supplement disability leave payments

(R.C. 124.385)

Continuing law provides disability leave to employees who are paid by warrant of the Director of Budget and Management and meet certain qualifications.  Continuing law allows employees to use available sick leave, personal leave, or vacation leave to supplement their disability leave payments to reach up to 100% of their base rate of pay.  H.B. 16 of the 128th General Assembly allows employees also to use available compensatory time balances to supplement their disability leave payments to reach up to 100% of their base rate of pay.  The act makes an identical amendment.

Payment of employee share of various benefits when employee is on disability leave

(R.C. 124.385)

The act requires that when a state employee is on approved disability leave, the employee must pay the employee's share of retirement contributions through the disability period, instead of the state paying the employee's share after the first three months of disability as prior law required.  The act also removes the former statutory requirement that the state pay the employee's share of health, life, and other insurance benefits during the disability period.

Salary continuation program for service-connected injuries and changes to occupational injury leave program

(R.C. 124.381)

Continuing law provides occupational injury leave to each employee of the Departments of Rehabilitation and Correction, Mental Health, Developmental Disabilities, Veteran Services,[10] and Youth Services, and to each employee of the School for the Deaf and the School for the Blind, who suffers bodily injury inflicted by an inmate, patient, client, youth, or student in the facilities of these agencies during the time the employee is lawfully carrying out the assigned duties of the employee's position.  Occupational injury leave is paid at the employee's total rate of pay during the period the employee is disabled as a result of the injury, but cannot exceed 120 work days.  Occupational injury leave is in lieu of workers' compensation.

Under the act, an employee of the agencies described in the preceding paragraph qualifies for occupational injury leave if the employee sustains a qualifying physical condition inflicted by a ward of these agencies during the time the employee is lawfully carrying out the assigned duties of the employee's position, and the duration of the leave is changed to 960 hours rather than 120 work days.  If such an employee's disability as a result of a qualifying physical condition extends beyond 960 hours, the employee immediately becomes subject to sick leave and disability leave benefits.

The act further provides, to employees in the service of the state, salary continuation not to exceed 480 hours at their total rate of pay for absence as a result of injuries incurred during the performance of, and arising out of, state employment after the implementation date the Director of Administrative Services establishes by rule.  If such an employee's absence as the result of such an injury extends beyond 480 hours, the employee immediately becomes subject to sick leave and disability leave benefits.

Employees of the Secretary of State, Auditor of State, Treasurer of State, Attorney General, Supreme Court, General Assembly, or Legislative Service Commission are not eligible for salary continuation unless the relevant appointing authority notifies the Director of Administrative Services in writing of the intent to have all of the appointing authority's employees participate in salary continuation.  The relevant appointing authority also may discontinue salary continuation for all of its employees by providing written notice of the discontinuation to the Director.

Participation in salary continuation is subject to rules adopted by the Director.

Under the act, an employee who is participating in the modified occupational injury leave program or the new salary continuation program is ineligible for other paid leave, including holiday pay, and does not accrue vacation leave credit, but does accrue sick leave credit and personal leave credit.

The act authorizes the Director of Administrative Services to adopt rules for the administration of both the modified occupational injury leave program and the new salary continuation program and for the payment of health benefits while an employee is on workers' compensation leave.  The rules are to include provisions for determining a disability, for filing a claim for leave, and for allowing or denying claims for leave.  And, by explicit implication from the act, the rules are to define the implementation date for the new salary continuation program.

Finally, the act clarifies that an appointing authority may apply to the Director of Administrative Services to grant both the new salary continuation and the modified occupational injury leave to law enforcement personnel employed by the appointing authority.

Elimination of probationary periods for intermittent employees

(R.C. 124.181 and 124.27)

Ongoing law provides pay supplements for exempt state employees who are paid in accordance with Salary Schedule E-1.  These pay supplements are for items such as service longevity, hazardous duty, call-back, shift differentials, professional achievement, and educational achievement.  H.B. 16 of the 128th General Assembly specifies that intermittent employees are not eligible for these pay supplements.  The act makes an identical amendment.

Continuing law generally requires that all original and promotional appointments in the classified civil service be for a probationary period of not less than 60 days or more than one year, as fixed by rule of the Director of Administrative Services.  The act excludes intermittent appointments from this requirement.

A rule of the Department of Administrative Services defines an "intermittent employee" as one who works an irregular schedule that (1) is determined by the fluctuating demands of the work, (2) is not predictable, and (3) is generally characterized as requiring less than 1,000 hours of work per fiscal year.

Elimination of involvement of the Department in layoffs not affecting employees paid by warrant of the Director of Budget and Management

(R.C. 124.321)

Continuing law requires that whenever it becomes necessary for an appointing authority to reduce its work force, the appointing authority must lay off its employees in the classified service or abolish their positions in accordance with the Civil Service Law and the rules of the Director of Administrative Services.  The act specifies that these rules, the rules of the Director that determine whether a lack of work exists, and the rules of the Director that govern the abolishment of positions apply to only employees in the service of the state, which are positions in the government of the state not including positions of employment with state-supported colleges and universities, counties, cities, city health districts, city school districts, general health districts, and civil service townships.

Employees in the classified civil service to be laid off for a lack of funds or lack of work within an appointing authority.  Appointing authorities that employ persons whose salary or wage is paid by other than by warrant of the Director of Budget and Management themselves determine whether a lack of funds or lack of work exists, and must file a statement of rationale and supporting documentation with the Director of Administrative Services before sending the layoff notices.  The act eliminates for these appointing authorities the requirement that they file this statement and documentation with the Director.

Department's responsibility for the administration of layoff displacement rights

(R.C. 124.324)

Continuing law grants to a laid-off employee in the classified civil service the right to displace employees with fewer retention points than the laid-off employee.  Retention points reflect an employee's length of continuous service and efficiency in service.

Prior law required the Director of Administrative Services to verify the calculation of the retention points of all employees.  The act requires the verification of this calculation for only employees in positions in the service of the state, which are positions in the government of the state that not including positions of employment with state-supported colleges and universities, counties, cities, city health districts, city school districts, general health districts, and civil service townships.

The act further provides that the Director's duty to adopt rules under the Administrative Procedure Act to implement layoff displacement rights apply to only employees in the service of the state.

Calculation of retention points for state employees affected by a layoff

(R.C. 124.325)

Prior law required the Director of Administrative Services to verify, for all employees in the classified civil service affected by a layoff, their length of continuous service and efficiency in service.  The act instead requires that the Director verify retention points only for employees laid off from positions in the service of the state, which are positions in the government of the state not including positions of employment with state-supported colleges and universities, counties, cities, city health districts, city school districts, general health districts, and civil service townships.

The act further provides that the Director's duty to adopt rules in accordance with the Administrative Procedure Act to (1) establish a system for the assignment of retention points for each employee in a job classification affected by a layoff and (2) for determining, in those instances where employees have identical retention points, which employee must be laid off first, applies only to employees in the service of the state.

Mandatory cost savings days for exempt state employees

(R.C. 124.34, 124.392, and 126.05)

Continuing law (1) authorizes the Director of Administrative Services to establish a voluntary cost savings program for certain employees who are paid by warrant of the Director of Budget and Management and who are exempt from the Public Employee Collective Bargaining Law and whose position is included in the Job Classification Plan the Director establishes and (2) requires the Director to adopt rules under the Administrative Procedure Act to administer the program.

In addition to the provisions described in the preceding paragraph, H.B. 16 of the 128th General Assembly requires the Director of Administrative Services to establish a mandatory cost savings program applicable to the employees described in that paragraph.  The program may include, but is not limited to, a loss of pay or loss of holiday pay as determined by the Director.  The program may be administered differently among exempt employees based on their job classifications, appointment categories, appointing authorities, or other relevant distinctions.  The Director is required to adopt rules under the Administrative Procedure Act to provide for administration of the mandatory cost savings program and days.

Under H.B. 16, each full-time exempt employee is required to participate in the mandatory cost savings program for a total of 80 hours of mandatory cost savings during both fiscal years 2010 and 2011.  Similarly, each part-time employee is required to participate in the mandatory cost savings program by not receiving holiday pay during both fiscal years 2010 and 2011.  Participation in the cost savings program described above is required for all employees of the Secretary of State, Auditor of State, Treasurer of State, or Attorney General unless the Secretary of State, Auditor of State, Treasurer of State, or Attorney General decides to exempt the office's employees and so notifies the Director of Administrative Services in writing on or before July 1, 2009.

After June 30, 2011, H.B. 16 authorizes the Director of Administrative Services, in consultation with the Director of Budget and Management, to implement mandatory cost savings days for exempt employees in the event of a fiscal emergency.  Each employee of the Secretary of State, Auditor of State, Treasurer of State, or Attorney General must participate in these mandatory cost savings days unless the Secretary of State, Auditor of State, Treasurer of State, or Attorney General chooses to exempt the office's employees and so notifies the Director of Administrative Services in the manner the Director of Administrative Services prescribes by rule.

H.B. 16 authorizes the Governor to declare a fiscal emergency if the Governor determines that the available revenue receipts and balances for any fund or across any funds will likely be less than the appropriations for the year, and to issue orders as necessary to the Director of Budget and Management to reduce expenditures, or to the Director of Administrative Services to implement personnel actions consistent therewith, including, but not limited to, the mandatory cost savings days described above.

H.B. 16 specifies that modifications or reductions in pay made as the result of voluntary or mandatory cost savings days are not modifications or reductions in pay that an employee in the classified civil service can appeal to the State Personnel Board of Review under the Civil Service Law.

Continuing law prohibits an employee whose salary or wage is paid in whole or in part by the state from being paid for a state holiday unless the employee was in active pay status on the scheduled work day immediately preceding the holiday.  H.B. 16 provides that such an employee need not be in active pay status on that work day in order to be paid for the holiday if the employee is participating in a voluntary or mandatory cost savings day on that work day.

The act enacts provisions identical to those above, but makes three modifications in them:

(1)  Under the act, if the Secretary of State, Auditor of State, Treasurer of State, or Attorney General did not exercise the option to participate in the mandatory cost savings program by July 1, 2009, the Secretary of State, Auditor of State, Treasurer of State, or Attorney General may decide to begin participation in the mandatory cost savings program for 80 hours or less and must notify the Director of Administrative Services in writing.  The Secretary of State, Auditor of State, Treasurer of State, or Attorney General and the director must mutually agree upon an implementation date for this participation.

(2)  The act specifies that cost savings days, whether under H.B. 16 or a labor-management contract, are considered to be remuneration for purposes of the provisions of the Unemployment Compensation Act specifying that weekly benefits are to be reduced by the amount of remuneration or other payments a claimant receives with respect to that week.

(3)  The act clarifies that the Director's duty to adopt rules applies to both the mandatory cost savings program and the voluntary cost savings program.

Creation of the Cost Savings Fund to account for savings from employee participation in the mandatory cost savings program and cost savings days

(R.C. 124.392)

H.B. 16 of the 128th General Assembly creates the Cost Savings Fund in the state treasury.  Savings accrued through employee participation in the mandatory cost savings program and in mandatory cost savings days are to be allocated to the Fund.  The Fund may be used to pay employees who participated in the program or in these days.  Any investments earnings of the fund must be credited to the Fund.  The act also creates the Cost Savings Fund.

Miscellaneous civil service changes

(R.C. 124.22 and 124.34)

Prior law required an applicant to take an examination for a position in the classified civil service to be a United States citizen or to have legally declared the intention of becoming a United States citizen.  The act instead requires that such an applicant be a United States citizen or have a valid permanent resident card.

Prior law required that an appointing authority serve an employee in the classified civil service with a copy of an order of suspension or fine in the case of (1) a suspension of 40 or more work hours if the employee is exempt from the payment of overtime compensation, (2) a suspension of 24 or more work hours if the employee is required to be paid overtime compensation, (3) a fine of 40 or more hours pay if the employee is exempt from the payment of overtime compensation, and (4) a fine of 24 or more hours' pay if the employee is required to be paid overtime compensation.

The act instead requires an appointing authority to serve an employee in the classified civil service with a copy of an order of suspension or fine in the case of (1) a suspension of more than 40 work hours if the employee is exempt from the payment of overtime compensation, (2) a suspension of more than 24 work hours if the employee is required to be paid overtime compensation, (3) a fine of more than 40 hours' pay if the employee is exempt from the payment of overtime compensation, and (4) a fine of more than 24 hours' pay if the employee is required to be paid overtime compensation.

Pay reduction for exempt employees of the Auditor of State

(R.C. 124.181 and 124.34)

The act requires a 2% pay reduction beginning with the pay period that immediately follows July 1, 2009, for exempt employees of the Auditor of State who are paid in accordance with Schedule E-1 or Schedule E-1 for Step 7.  This pay reduction is not to be considered a modification or reduction in pay that an employee in the classified civil service can appeal to the State Personnel Board of Review.

Health Care Spending Account Fund

(R.C. 124.821)

The act creates the Health Care Spending Account Fund in the state treasury.  The Director of Administrative Services is required to use the money in the fund to make payments with regard to the participation of state employees in flexible spending accounts for certain nonreimbursed medical and dental expenses under section 125 of the Internal Revenue Code.  All investment earnings on money in the fund must be credited to the fund.

Dependent Care Spending Account Fund

(R.C. 124.822)

The act creates the Dependent Care Spending Account Fund in the state treasury.  The Director of Administrative Services is required to use money in the fund to make payments with regard to the participation of state employees in flexible spending accounts for work-related dependent care expenses under section 125 of the Internal Revenue Code.  All investment earnings on money in the fund must be credited to the fund.

State Employee Educational Development Fund

(R.C. 124.86; Section 207.30.50)

The act requires the Director of Administrative Services to establish and obtain the Director of Budget and Management's approval of charges for employee educational development programs undertaken pursuant to specific collective bargaining agreements identified in uncodified law.  In the act, the agreements are those for District 1199, the Health Care and Social Service Union; State Council of Professional Educators; Ohio Education Association and National Education Association; the Fraternal Order of Police Ohio Labor Council, Unit 2; and the Ohio State Troopers Association, Units 1 and 15.  The charges must be sufficient to cover only state administrative costs for the employee educational development programs.  Money collected from the charges, and interest earned on that money, must be deposited into the new Employee Educational Development Fund, which the act creates in the state treasury.  The Director of DAS must administer the fund in accordance with the applicable collective bargaining agreements and may adopt rules for the purpose of administering the fund.  If the Director of DAS determines that additional amounts are necessary, the Director may request the Director of Budget and Management to approve additional amounts, which the act appropriates.

MARCS Administration Fund

(R.C. 4501.29)

The act requires the Department of Administrative Services to collect user fees from participants in the multi-agency radio communications system (MARCS).  The Director of Administrative Services, with the advice of the MARCS Steering Committee and the consent of the Director of Budget and Management, must determine the amount of the user fees and the manner by which the fees are to be collected.  All moneys from user fees must be deposited in the MARCS Administration Fund, which the act creates in the state treasury.  All investment earnings on moneys in the fund are to be credited to the fund.

State employee payroll reduction strategies

(Section 741.10)

The act authorizes the Office of Collective Bargaining in the Department of Administrative Services to negotiate with the respective state collective bargaining units various payroll reduction strategies through the collective bargaining process prior to July 1, 2009, including, but not limited to, reductions in pay for fiscal years 2010 and 2011 and an increase in a state employee's share of dental, vision, and life insurance benefits during those fiscal years.  If the Office successfully negotiates or reaches alternative payroll reduction strategies through the collective bargaining process, those payroll reduction strategies must be implemented.  The total amount of state employee payroll reduction strategy savings to be negotiated or implemented for each of fiscal years 2010 and 2011 is to be between $170 and $200 million, unless otherwise agreed to by the Office of Collective Bargaining and the Director of Budget and Management.  The Director of Budget and Management is authorized to transfer cash from non-General Revenue Fund funds to the General Revenue Fund to carry out these provisions.

Preference for purchasing products made and services performed in the United States and Ohio with funds made available for fiscal stabilization and recovery purposes

(Section 701.40)

The act states that the General Assembly intends that all funds appropriated or otherwise made available by the state for fiscal stabilization or recovery purposes, or by the American Recovery and Reinvestment Act of 2009, are to be used, to the extent possible, in accordance with the preferences established in the Buy Ohio Act to purchase products made and services performed in the United States and in Ohio.  The act states that the General Assembly further recognizes that a preference for buying goods and materials that are produced, and services that are performed, in the United States for projects is important for maximizing the creation of American jobs and restoring economic growth and opportunity.

If any person requests or obtains a waiver of the preferences described above, the Director of Administrative Services must publish information identifying the person and the product or service with regard to which the waiver was requested or obtained.  The act states that the purpose of publishing this information is to enhance opportunities for producers, service providers, and workers to identify and provide products made and services performed in the United States and Ohio, and thereby maximize the success of the fiscal stabilization and economic recovery program.  The Director must publish the identifying information on an Internet web site maintained by the Department of Administrative Services.

Sufficient competition for purchase of Ohio-produced or mined products (VETOED)

(R.C. 125.11)

Before awarding a contract for the purchase of products, the Department of Administrative Services or a state agency responsible for evaluating such a contract must evaluate the bids received according to criteria and procedures for determining if a product is produced or mined in the United States or in Ohio.  The Department or the other state agency must first remove bids that offer products that have not been or that will not be produced or mined in the United States.  From among the remaining bids, the Department or the other state agency must select the lowest responsive and responsible bid from among the bids that offer products that have been produced or mined in Ohio where sufficient competition can be generated within Ohio to ensure that compliance with the preference for Ohio products will not result in an excessive price for the product or acquiring a disproportionately inferior product.  If there are two or more qualified bids that offer products that have been produced or mined in Ohio, it is deemed that there is sufficient competition to prevent an excessive price for the product or acquiring a disproportionately inferior product.  The Governor vetoed an amendment that would have increased the number of these bids from two to four.

Contractor compliance with local regulations or ordinances that relate to the employment of residents and local businesses

(R.C. 153.013 and 5525.26)

If a project for the construction, alteration, or other improvement of a building or structure is administered by the Director of Administrative Services or by another state agency authorized to administer a project under the Public Improvements Law (R.C. Chapter 153.), or similarly, if a project for the construction, reconstruction, or other improvement to a road or highway is administered by the Department of Transportation or any local public authority authorized to administer such a project, if the project is located in a municipal corporation with a population of at least 400,000 that is in a county with a population of at least 1.2 million, and if a political subdivision contributes at least $100,000 to the project, the act requires a contractor for the project to comply with regulations or ordinances of the political subdivision that are in effect before July 1, 2009, and that specifically relate to the employment of residents and local businesses of the political subdivision in the performance of the work of the project, and such ordinances are required under the act to be included by reference unambiguously in the contract between the administering state agency, department, or local public authority, and the contractor for the project.

Databases of state employee pay, agency expenses, and tax credit issuances published on one Internet web site (PARTIALLY VETOED)

(R.C. 125.20)

The act requires, within 180 days after the provision's effective date, that the Director of Administrative Services establish a single electronic site accessible through the Internet on which, had the provision been left intact without vetoes, three databases would have been published.  Two databases remain in part as a result of the vetoes.

The first database, which remains in part, contains each state employee's gross pay from the most recent pay period, including the name of the agency, the employee's position title, and the employee's name.  The Governor vetoed provisions that would have required this database to contain an employee's year-to-date gross pay and searchable fields.

The second database, which the Governor vetoed in its entirety, would have contained agency expenditures for goods and services and searchable fields, including the name of the agency, expenditure amount, category of good or service for which an expenditure was made, and the name of the contractor or vendor.

The third database, which also remains in part, contains tax credits issued by the Director of Development to business entities, including the name under which the tax credit is known, the name of the entity receiving the tax credit, and the county in which the tax credit recipient's principal place of business in Ohio is located.  The Governor vetoed a provision that would have required this database to contain searchable fields.

The Director of Administrative Services is authorized to adopt rules governing the means by which information is submitted and the two remaining databases are updated.  The Governor vetoed a provision that would have required each executive agency to provide daily to the Department of Administrative Services information to be published in the databases.

Life insurance coverage for county and municipal court judges

(R.C. 124.81)

The act requires the Department of Administrative Services, in consultation with the Superintendent of Insurance, to negotiate with and, in accordance with the competitive selection procedures of the State Purchasing Act, to contract with one or more insurance companies that are authorized to do business in Ohio for the issuance of a group life insurance policy covering all municipal and county court judges.  The amount of the coverage must equal the aggregate salary for each municipal and county court judge as prescribed by law.  On and after the effective date of the life insurance coverage for municipal and county court judges, these judges are ineligible for life insurance coverage from any county or other political subdivision.

Removal of obsolete pay tables prescribing pay for exempt employees

(R.C. 124.152)

The act removes obsolete pay tables, which apply only to years that have ended, from the statute that prescribes pay for exempt employees.  Generally, exempt employees are employees who are exempt from public employee collective bargaining.

State agency spending controls

The act codifies the Governor's Executive Order 2009-07S by statutorily imposing state agency spending controls as were directed in the order.

The spending controls imposed by the act apply generally to each state agency, that is, to any organized body, office, or agency that is established by law for the exercise of any function of state government.  Exempt from the spending controls are the general assembly and any legislative agency, the elected state officers,[11] the courts and any judicial agency, and state institutions of higher education.  (R.C. 126.50(B).)

State agency spending plans and their implementation

(R.C. 126.50(A), 126.501, 126.502, and 126.507)

By November 1, 2009, each state agency must submit to the General Assembly and to the Director of Budget and Management a spending plan that outlines a 30% overall reduction in spending on supplies and services for fiscal years 2010 and 2011.  Thereafter, by February 1 of each odd-numbered year, beginning in 2011, the director of each state agency must submit to the General Assembly and the Director of Budget and  Management a spending plan for purchasing supplies and services for the following two fiscal years.

Each spending plan must address any potential savings, lack of savings, or costs the state agency may realize by implementing each of the following strategies:

(1)  Gaining approval from the state agency's director or the director's designee for any purchase of supplies or services costing $1,000 or more.

(2)  Renegotiating, if not otherwise prohibited, contracts entered into before July 1, 2009, and especially those contracts in which a vendor is willing to reduce costs by 15% or more while maintaining substantial equivalency on other terms.

(3)  With the approval of the Director of Administrative Services, allowing contracts for critical services that are up for renewal to expire and be rebid.

(4)  With the approval of the Director of Budget and Management, cancelling all contracts entered into before July 1, 2009, that are supported by noncapital funds.

(5)  Cooperatively purchasing supplies and services with other state agencies.

(6)  Using other state agencies to provide needed services.

(7)  Purchasing equipment and furniture in compliance with any control-on-equipment directive issued by the Office of Budget and Management (see below).

(8)  Reducing parking expenses, including expenses for purchased and leased spaces for state agency employees, spaces for fleet vehicles, and spaces and parking reimbursement for state agency employees on agency business.

In particular, the spending plan must include a review of a loss of efficiency or other benefits related to the reduction in parking expenses.

A "critical service" for purposes of a spending plan is a service provided by the state, the deferral or cancellation of which would cause an immediate risk to the health, safety, or welfare of Ohioans, an undermining of activity aimed at creating or retaining jobs in Ohio, or an interference with the receipt of revenue or the realization of savings.  A service provided by the state is not a "critical service" if its deferral or cancellation would result in inconvenience, sustainable delay, or other similar compromise to the normal provision of state-provided services.

By December 1, 2009, the Director of Budget and Management must issue guidance to each state agency on which spending plan strategies the state agency is expected to implement for fiscal years 2010 and 2011.  Thereafter, by March 1 in each odd-numbered year, beginning in 2011, the Director of Budget and Management must issue guidance to each state agency on which spending plan strategies the agency is expected to implement for the following two fiscal years.

In consultation with the Director of Budget and Management, the Director of Administrative Services must monitor the implementation of spending plan strategies by state agencies, and must report semiannually to the Governor and the General Assembly regarding the effectiveness of the implemented strategies and any unintended consequences of the implemented strategies.

Specific state agency spending controls

In addition to general state agency spending plans, the act imposes several specific spending controls on state agencies.  All of them are modeled on directives in the Governor's Executive Order 2009-07S, as were the spending plan provisions.

State agency travel expense controls

(R.C. 126.503)

Each state agency must control nonessential travel expenses by doing all of the following:

(1)  Complying with any travel directives issued by the Director of Budget and Management;

(2)  Using, when possible, the online travel authorization and expense reimbursement process;

(3)  Conducting meetings, whenever possible and in compliance with the Open Meetings Act, by using conference calls, teleconferences, webinars, or other technology tools;

(4)  Using fleet vehicles for official state travel whenever possible; and

(5)  Following restrictions set by the Department of Administrative Services regarding mileage reimbursement under the Fleet Management Act.

The Director of Budget and Management is prohibited from reimbursing any state agency employee for unauthorized travel expenses.

Office overhead cost controls

(R.C. 126.504)

Each state agency must use the interoffice mailing service provided by the Department of Administrative Services for all mail deliveries to other state agencies that are located within a reasonable distance of the sending agency.

And, by October 1, 2009, each state agency must direct all major printing, copying, mail preparation, and related services through the Department of Administrative Services and eliminate any internal operations providing those services.

Purchasing controls

(R.C. 126.505)

The act requires the Director of Budget and Management to issue, and to revise as necessary, control-on-equipment directives applying to all purchases of furniture and equipment by state agencies.  Each state agency must comply with the control-on-equipment directives, and with any purchasing standardization and strategic sourcing policy directives that have been issued by the Director of Administrative Services.

Information technology controls

(R.C. 125.18(B), 125.181, and 126.506)

The State Chief Information Officer[12] is required to lead, oversee, and direct state agency activities related to information technology development and use.  In addition to the State Chief Information Officer's other duties, the act requires the State Chief Information Officer (1) to establish policies and standards for the acquisition and use of common information technology by state agencies, including hardware, software, technology services, and security, and for the extension of the service life of information technology systems, (2) to establish policies on the purchasing, use, and reimbursement for the use of handheld computing and telecommunications devices by state agency employees, (3) to establish policies for the reduction of printing and the use of electronic records by state agencies, and (4) to establish policies for the reduction of energy consumption by state agencies.  Each state agency must participate in information technology consolidation projects implemented by the State Chief Information Officer under the law prescribing the officer's duties (R.C. 125.18).  And each state agency, at the direction of and in the format specified by the Director of Administrative Services, must maintain a list of information technology assets possessed by the agency and associated costs related to those assets.

The act requires the Director of Administrative Services to establish a State Information Technology Investment Board and organize it as part of the Department of Administrative Services.  The Board is to consist of representatives from various state elective offices and state agencies, including the Office of Budget and Management. Members of the Board are not entitled to compensation for their services.

The Information Technology Investment Board is to identify and recommend to the State Chief Information Officer opportunities for consolidation and cost-saving measures relating to information technology.

Compliance with a new uncodified statute based on Executive Order 2008-13S in complying with the Minority Set Aside Act and EDGE Business Enterprise Act

(Section 701.50)

The act requires that state agencies, state universities, and the Ohio Housing Finance Agency, the Third Frontier Commission, the Clean Ohio Council, and the Ohio School Facilities Commission comply with a new uncodified statute based upon Executive Order 2008-13S when complying with the minority business enterprise set aside purchasing requirements of the Minority Business Enterprise Set Aside Act or with the procurement goals of the EDGE Business Enterprise Act (R.C. 123.152(B)(2) and (B)(14) and 125.081(B), not in the act).  The uncodified statute, unless its context clearly indicates otherwise, will have no effect after June 30, 2011 (Section 809.10).  Executive Order 2008-13S requires each agency to appoint an Equal Opportunity Officer and to include specified provisions in their contracts for the purchase of goods and services.

"Minority business enterprise" means an individual who is a United States citizen and who owns and controls a business, partnership, corporation, or joint venture of any kind that is owned or controlled by United States citizens who are Ohio residents and members of one of the following economically disadvantaged groups:  Blacks or African-Americans, American Indians, Hispanics or Latinos, and Asians (R.C. 122.71(E)(1)).  "EDGE business enterprise" means a sole proprietorship, association, partnership, corporation, limited liability corporation, or joint venture certified as a participant in the Encouraging Diversity, Growth, and Equity (EDGE) Program by the Director of Administrative Services (R.C. 123.152(A), not in the act).

Equal Employment Opportunity Officers

The act requires each state agency to appoint an Equal Employment Opportunity Officer who is responsible for monitoring the agency's compliance with the Minority Business Enterprise Set Aside Act and the EDGE Business Enterprise Act, and for reporting the level of the agency's compliance to the Deputy Director of the Equal Opportunity Division of the Department of Administrative Services.  A state agency's Equal Employment Opportunity Officer must also do all of the following:

(1)  Analyze spending on goods, services, and construction projects for the agency and determine any missed opportunities for the inclusion of certified minority business enterprise and EDGE business vendors;

(2)  Analyze the spending of the agency with EDGE business enterprise vendors, as well as EDGE business enterprise vendor availability by regions of the state, and communicate the analysis to the Department of Administrative Services so that the Department can determine the appropriate EDGE business enterprise goal for each contract;

(3)  Report minority business enterprise or EDGE business enterprise enrollment for all contracts issued by the agency to the Deputy Director of the Equal Opportunity Division;

(4)  Implement a scorecard system that tracks compliance with the minority business enterprise and EDGE business enterprise program requirements by the agency;

(5)  Implement the outreach and training plan to ensure compliance by the agency with minority business enterprise and EDGE business enterprise requirements;

(6)  Attend the semiannual training conducted by the Deputy Director of the Equal Opportunity Division on minority business enterprise and EDGE business enterprise requirements; and

(7)  Participate in the annual compliance review conducted by the Deputy Director of the Equal Opportunity Division and implement recommendations made by the Deputy Director as a result of the review process.

The act requires the Deputy Director of the Equal Opportunity Division to (1) develop a scorecard system and the outreach and training plan, (2) conduct semiannual training on minority business enterprise set aside and EDGE business enterprise procurement requirements for Equal Employment Opportunity Officers, (3) conduct an annual review of each state agency's compliance with minority business enterprise set aside and EDGE business enterprise procurement requirements, and (4) make recommendations for improved compliance as a result of each review.

Agency contract provisions

The act requires each state agency to ensure that all contracts it enters into for the purchase of goods and services contain provisions that do all of the following:

(1)  Prohibit contractors and subcontractors from engaging in discriminatory employment practices;

(2)  Certify that contractors and subcontractors are in compliance with all applicable federal and state laws and rules that govern fair labor and employment practices; and

(3)  Encourage contractors and subcontractors to purchase goods and services from certified minority business enterprise and EDGE business enterprise vendors.

EDGE waiver controls

The act prohibits a state agency from issuing an EDGE business enterprise waiver without doing all of the following:

(1)  Having all waivers reviewed by the agency's Procurement Officer, in collaboration with the agency's Equal Employment Opportunity Officer, who must certify that each waiver the agency issues complies with criteria for granting the waiver;

(2)  Submitting quarterly reports to the Equal Opportunity Division that lists each waiver the agency grants; and

(3)  Permitting the Equal Opportunity Division to complete its review of the agency's quarterly report and to conduct periodic audits of the agency's administration of the waiver process.

The Deputy Director of the Equal Opportunity Division must review each quarterly report of EDGE business enterprise waivers and conduct periodic audits of each agency's administration of the waiver process.  If the Deputy Director determines that a state agency has not properly administered the issuance of EDGE business enterprise waivers, subsequent waivers cannot be issued by that state agency without the authorization and approval of the Deputy Director.  The Deputy Director may release a state agency from the approval process when the Deputy Director has determined that the agency has the ability to consistently administer the waiver process.

Annual compliance report

Annually, on October 1, the Deputy Director of the Equal Opportunity Division must submit a written report to the Governor, the Speaker and Minority Leader of the House and the President and Minority Leader of the Senate, that describes the progress of state agencies in advancing the minority business enterprise set aside and EDGE business enterprise procurement programs, as well as any initiatives that have been implemented to increase the number of certified minority business enterprise and EDGE business enterprise vendors doing business with the state.

Deadline of December 31, 2009, for state agencies to establish a long–term plan for compliance with the Minority Set Aside Act and EDGE Business Enterprise Act

(Section 701.52)

Under the act, if a state agency, including a state university and the Ohio Housing Finance Agency, the Third Frontier Commission, the Clean Ohio Council, and the Ohio School Facilities Commission, has failed to comply with the minority business set aside purchasing requirements of the Minority Business Enterprise Act, or with the procurement goals specified under the EDGE Business Enterprise Act, the state agency must establish, by December 31, 2009, a long-term plan for compliance.

Explicit requirement to comply with Minority Business Set Aside Act and Edge Business Enterprise Act

(Section 701.51)

The act explicitly requires, to the extent that the Ohio School Facilities Commission, the Ohio Housing Finance Agency, the Third Frontier Commission, the Clean Ohio Council, and state universities are authorized to make purchases, it must set aside a percentage of its purchases of goods and services for purchase from minority business enterprises as required by the Minority Business Enterprise Set Aside Act (R.C. 125.081(B), not in the act).  Under continuing law, the percentage of purchases to be so set aside is to approximate 15%.

The act also explicitly requires the Ohio Housing Finance Agency, the Third Frontier Commission, and the Clean Ohio Council to comply with agency procurement goals for contracting with EDGE Business Enterprises established under continuing law (see R.C. 123.152, not in the act).

Changes in the Minority Business Bonding Program

(R.C. 122.89)

Minority Business Bonding Program

The act requires that the rules of the Minority Development Financing Advisory Board for the Minority Business Bonding Program must provide for a retainage of money paid to a participating minority business or EDGE business enterprises[13] of 15% for contracts valued at more than $50,000 and for a retainage of 12% for contracts valued at $50,000 or less (R.C. 122.89(D)).  "Retainage" is a percentage of what a landowner pays a contractor that is withheld until construction has been satisfactorily completed and all mechanics liens have been released or have expired (Black's Law Dictionary 1341 (8th ed.)).

The act also permits a minority business or EDGE business enterprise to bid or enter into a contract with the state or any state instrumentality without being required to provide a bond as follows:

For the first contract, the minority business or EDGE business enterprise may bid or enter into a contract valued at $25,000 or less without being required to provide a bond, but only if the minority business or EDGE business enterprise is participating in a qualified contractor assistance program[14] or has successfully completed such a program[15] after the referendum effective date.[16]

After the state or any state instrumentality has accepted the first contract as completed and all subcontractors and suppliers on the contract have been paid, the minority business or EDGE business enterprise may bid or enter into a second contract with the state or that state instrumentality valued at $50,000 or less without being required to provide a bond, but only if the minority business or EDGE business enterprise is participating in a qualified contractor assistance program or has successfully completed such a program after the referendum effective date.

After the state or any state instrumentality has accepted the second contract as completed and all subcontractors and suppliers on the contract have been paid, the minority business or EDGE business enterprise may bid or enter into a third contract with the state or that state instrumentality valued at $100,000 or less without being required to provide a bond, but only if the minority business or EDGE business enterprise has successfully completed a qualified contractor assistance program after the referendum effective date.

After the state or any state instrumentality has accepted the third contract as completed and all subcontractors and suppliers on the contract have been paid, the minority business or EDGE business enterprise may bid or enter into a fourth contract with the state or that state instrumentality valued at $300,000 or less without being required to provide a bond, but only if the minority business or EDGE business enterprise has successfully completed a qualified contractor assistance program after the referendum effective date.

After the state or any state instrumentality has accepted the fourth contract as completed and all subcontractors and suppliers on the contract have been paid, upon a showing that with respect to a contract valued at $400,000 or less with the state or any state instrumentality, that the minority business or EDGE business enterprise either has been denied a bond by two surety companies or that the minority business or EDGE business enterprise has applied to two surety companies for a bond and, at the expiration of 60 days after making the application, has neither received nor been denied a bond, the minority business or EDGE business enterprise can repeat its participation in the unbonded state contractor program as explained above.  A minority business or EDGE business enterprise is not permitted to participate in the unbonded state contractor program more than twice.

The act further permits a minority business or EDGE business enterprise to bid or enter into a contract with any political subdivision of the state or any instrumentality of a political subdivision of the state without being required to provide a bond as follows:

For the first contract, the minority business or EDGE business enterprise may bid or enter into a contract valued at $25,000 or less without being required to provide a bond, but only if the minority business or EDGE business enterprise is participating in a qualified contractor assistance program or has successfully completed such a program after the referendum effective date.

After any political subdivision or political subdivision instrumentality has accepted the first contract as completed and all subcontractors and suppliers on the contract have been paid, the minority business or EDGE business enterprise may bid or enter into a second contract with that political subdivision or political subdivision instrumentality valued at $50,000 or less without being required to provide a bond, but only if the minority business or EDGE business enterprise is participating in a qualified contractor assistance program or has successfully completed such a program after the referendum effective date.

After any political subdivision or political subdivision instrumentality has accepted the second contract as completed and all subcontractors and suppliers on the contract have been paid, the minority business or EDGE business enterprise may enter into a third contract with that political subdivision or political subdivision instrumentality valued at $100,000 or less without being required to provide a bond, but only if the minority business or EDGE business enterprise has successfully completed a qualified contractor assistance program after the referendum effective date.

After any political subdivision or political subdivision instrumentality has accepted the third contract as completed and all subcontractors and suppliers on the contract have been paid, the minority business or EDGE business enterprise may bid or enter into a fourth contract with that political subdivision or political subdivision instrumentality valued at $200,000 or less without being required to provide a bond, but only if the minority business or EDGE business enterprise has successfully completed a qualified contractor assistance program after the referendum effective date.

After any political subdivision or political subdivision instrumentality has accepted the fourth contract as completed and all subcontractors and suppliers on the contract have been paid, upon a showing that with respect to a contract valued at $300,000 or less with any political subdivision or any political subdivision instrumentality, that the minority business or EDGE business enterprise either has been denied a bond by two surety companies or that the minority business or EDGE business enterprise has applied to two surety companies for a bond and, at the expiration of 60 days after making the application, has neither received nor been denied a bond, the minority business or EDGE business enterprise can repeat its participation in the unbonded political subdivision contractor program as explained above.  A minority business or EDGE business enterprise is not permitted to participate in the unbonded political subdivision contractor program more than twice.

The act allows a minority business or EDGE business enterprise that has entered into two or more contracts with the state or with any state instrumentality to bid or enter into a contract with a political subdivision of the state or with any instrumentality of a political subdivision valued at the level at which the minority business or EDGE business enterprise would qualify if entering into an additional contract with the state.

The act requires the Director of Development to coordinate and oversee the programs explained above and the approval of a qualified contractor assistance program. The Director must prepare an annual report and submit it to the Governor and the General Assembly on or before February 1.  The report must include the following:  information on the Director's activities for the preceding calendar year regarding the programs explained above, a summary and description of the operations and activities of the programs, an assessment of the achievements of the programs, and a recommendation as to whether the programs need to continue.

Two-year pilot project involving the conversion of 10% of certain vehicles of the state fleet to a propane fuel system (VETOED)

(Section 701.70)

The Governor vetoed a section of the act that would have required the Department of Administrative Services to conduct a pilot project involving propane-powered state vehicles.  During the period commencing October 1, 2009, and ending September 30, 2010, the Department would have been required to convert or cause to be converted to a propane fuel system 5% of the gasoline-powered passenger cars, sport utility vehicles, and light-duty pickup trucks that are owned by the state and that are used by the Department of Natural Resources, 5% of such vehicles that are used by the Department of Public Safety, and 5% of such vehicles that are used by the Department of Transportation.  During the period commencing October 1, 2010, and ending December 31, 2010, the Department of Administrative Services would have been required to convert or cause to be converted to a propane fuel system an additional 5% of such state vehicles.  Only propane fuel systems that have been approved by the United States Environmental Protection Agency could have been installed in state vehicles under the pilot program.

From October 1, 2009, through September 30, 2011, the Department would have been required to keep detailed records of the propane-powered vehicles, including fuel mileage and maintenance costs.  After September 30, 2011, the Department would have been required to conduct a study of the pilot project to assess all aspects of the use by the state of propane-powered vehicles during the pilot project.  The study would have been required to include all relevant findings and recommendations, if any, regarding future use of propane gas in state vehicles, and would have been required to be compiled into a final report.  The Department would have been required to submit copies of the final report not later than December 31, 2011, to the Governor, the President of the Senate, the Minority Leader of the Senate, the Speaker of the House of Representatives, and the Minority Leader of the House of Representatives.

 

·         Specifies the amounts the Department of Aging must use to determine whether an individual is eligible for a payment under the Residential State Supplement (RSS) program and the amount each resident is to receive per month.

·         Would have created the Residential State Supplement Workgroup to examine the issue of which state agency is the most appropriate to administer the RSS program (VETOED).

·         Permits the Director of Aging to expand the PACE program to additional regions of Ohio to the extent funding is available.

·         Establishes a home first process for the PACE program under which an individual who is admitted to a nursing facility while on a PACE waiting list is to be enrolled in the program in accordance with priorities established in rules.

·         Establishes requirements regarding kosher home-delivered meals provided under the PASSPORT program and requires the reimbursement rate for the meals to be equal to the reimbursement rate for home-delivered therapeutic meals.

·         Codifies the Choices Program and requires that it be available statewide, subject to federal approval.

·         Provides that the Assisted Living Program may not serve more individuals than the number that is set by the federal government when the Medicaid waiver authorizing the program is approved.

·         Requires the Director of Job and Family Services to seek federal approval to consolidate three Department of Aging-administered Medicaid waiver programs (the Assisted Living Program, Choices Program, and PASSPORT Program).

·         Eliminates the requirement that the Director of Job and Family Services report annually on (1) the number of individuals enrolled in the PASSPORT Program and Assisted Living Program pursuant to the "Home First" provisions of the programs and (2) the costs incurred and savings achieved as a result of the enrollments.

·         Permits the Director of Aging to impose civil fines in lieu of the criminal fines that may be imposed for violating the prohibitions against (1) subjecting a long-term care facility resident or community long-term care services recipient to retaliation for filing a complaint or (2) denying the Long-Term Care Ombudsperson access to a long-term care facility or community-based long-term care site to investigate a complaint.

·         Expressly provides that a community-based long-term care agency is not required to be certified to receive payment from the Department of Aging if the agency has a grant agreement with the Department or its designee to provide community-based long-term care services.

·         Extends the Director of Aging's rulemaking authority regarding contracts and grant agreements to those that are entered into by the Department of Aging's designee.

·         Requires, subject to federal approval if needed, the Department of Aging to enter into an interagency agreement with the Department of Job and Family Services under which the Department of Aging is required to establish for each biennium a unified long-term care budget for home and community-based services covered by a component of the Medicaid program the Department of Aging administers.

·         Requires, subject to federal approval if needed, the Department of Aging to ensure that the unified long-term care budget is administered in a manner that provides Medicaid coverage of and expands access to three groups of services.

·         Requires, subject to federal approval if needed, the Department of Aging or its designee to provide care management and authorization services with regard to certain state Medicaid plan services that are provided to participants of Medicaid waiver programs the Department administers.

·         Creates the Unified Long-Term Care Budget Workgroup and requires the Workgroup to develop a unified long-term care budget.

·         Requires the Directors of Aging and Budget and Management to annually submit a written report describing the progress towards establishing, or if already established, the effectiveness of the unified long-term care budget.

·         Eliminates a requirement that nursing facility residents who apply or indicate an intention to apply for Medicaid and nursing facility residents who are likely to spend down their resources within six months after admission to a nursing facility to a level at which they are financially eligible for Medicaid be provided with a long-term care consultation unless exempt from that requirement and provides instead that a consultation may be provided to a nursing facility resident regardless of the source of payment being used for the resident's care in the nursing facility.

·         Requires that a consultation be provided to an individual identified by the Department of Aging or a program administrator as being likely to benefit from consultation and, for this purpose, grants the Department or administrator access to data collected from a nursing facility's assessments of its residents.

·         Eliminates provisions that exempt certain individuals from having a consultation.

·         Provides that a consultation is not required if an individual or individual's representative "refuses to cooperate" with the consultation, rather than if the individual "chooses to forego" participation.

·         Eliminates the requirement that a written summary of each long-term care consultation be provided, but requires the Department of Aging or a program administrator, as part of the Long-Term Care Consultation Program, to assist an individual or individual's representative in accessing all sources of care and services that are appropriate for the individual and for which the individual is eligible.

·         Requires the Department of Aging and program administrators to administer the Long-Term Care Consultation Program in a manner that provides for certain assessments and procedures.

·         Specifies that the Director of Aging must give notice and an opportunity for a hearing before imposing a fine on a nursing facility for admitting an individual who has not received a long-term care consultation.

·         Permits the Director of Aging to fine a nursing facility for denying access to the facility or to residents of a facility as needed to perform a consultation or implement the Long-Term Care Consultation Program.

·         Requires the Department of Aging or a program administrator to monitor an individual who receives a long-term care consultation and is eligible for and elects to receive home and community-based services covered by a component of the Medicaid program the Department administers.

·         Requires the Department of Aging to prepare an annual report regarding the individuals who are the subjects of long-term care consultations and elect to receive home and community-based services covered by a component of the Medicaid program the Department administers.

·         Eliminates the Ohio's Best Rx Program and establishes timeframes for concluding the program's affairs.

·         Permits the Director of Aging to contract with any person for the operation of a drug discount program similar to the Best Rx Program and allows the Director to provide information to the person regarding former Best Rx Program participants and applicants.

·         Adds the Director of the Governor's Office of Faith-based and Community Initiatives to the Ohio Community Service Council as an ex officio, nonvoting member.

·         Removes the Department of Aging as the council's fiscal agent, and instead requires the council to enter into a written agreement with "another state agency" to serve as the council's fiscal agent.

·         Specifies that the council must follow, in addition to all state procurement requirements, all state fiscal, human resources, statutory, and administrative rule requirements.

·         Adds the Director of Aging to the Brain Injury Advisory Committee.

Residential State Supplement program

Background

The Department of Aging administers the Residential State Supplement (RSS) program, which provides a cash supplement to payments provided to eligible aged, blind, or disabled adults under the Supplement Security Income (SSI) program.  The cash supplements provided under the RSS program must be used for the provision of accommodations, supervision, and personal care services.[17]

Eligibility and payments amounts

(Section 209.30)

To qualify for the RSS program, an SSI recipient must meet a number of requirements.  One of the requirements concerns where the recipient resides.  Another requirement concerns financial matters.

The act specifies the amounts the Department of Aging is required to use to determine whether an SSI recipient is eligible for an RSS payment and the amount each eligible individual is to receive per month.[18]  The amounts are tied to the various places in which an SSI recipient must reside to qualify for the RSS program as follows:

(1)  $927 for a resident of a residential care facility;[19]

(2)  $927 for a resident of an adult group home;[20]

(3)  $824 for a resident of an adult foster home;[21]

(4)  $824 for a resident of an adult family home;[22]

(5)  $824 for a resident of an adult residential facility;[23]

(6)  $618 for a person receiving adult community mental health housing services.[24]

Residential State Supplement Workgroup (VETOED)

(Section 209.30)

The Governor vetoed a provision that would have created the Residential State Supplement Workgroup.  The Workgroup was to consist of the following state agency directors or the Directors' designees:

(1)  The Director of Aging;

(2)  The Director of Health;

(3)  The Director of Job and Family Services;

(4)  The Director of Mental Health.

The Director of Aging or the Director's designee was to serve as the Workgroup's chairperson.  Members were to serve without compensation, except to the extent that serving on the Workgroup was considered part of their regular employment duties.

The Workgroup would have been required to examine solely the issue of which state agency is the most appropriate to administer the RSS program.  The act would have required, not later than December 31, 2009, the Workgroup to submit written recommendations on this issue to the Governor and General Assembly.[25]  The Workgroup was to cease to exist on submission of its recommendations.

PACE program

Background

Federal law permits a state to include in its Medicaid program a component known as the Program of All-inclusive Care for the Elderly (PACE).[26]  The state agency administering the PACE program and the United States Secretary of Health and Human Services enter into an agreement with a provider under which the provider, directly or by contract with other entities, provides medical services to individuals enrolled in the PACE program.

The medical services available under the PACE program must include all items and services covered by the Medicaid program and, in the case of PACE enrollees who are also entitled to benefits under Medicare Part A or enrolled in Medicare Part B, all items and services covered by Medicare.  The medical services are to be provided without any limitation or condition as to amount, duration, or scope and without application of deductibles, copayments, coinsurance, or other cost-sharing that would otherwise apply under Medicaid or Medicare.  The medical services are also to include all additional items and services specified in federal regulations.  The provider is required to provide PACE enrollees access to necessary covered items and services 24 hours per day, every day of the year.  The enrollees are to receive the medical services through a comprehensive, multidisciplinary health and social services delivery system that integrates acute and long-term services pursuant to federal regulations.

To be eligible for the PACE program, a Medicaid recipient must be (1) at least 55 years old, (2) require the level of care required by the state's Medicaid program for coverage of nursing facility services, (3) reside in an area of the state in which the PACE program is available, and (4) meet all other eligibility requirements included in a PACE agreement with a provider.[27]  A PACE enrollee may maintain eligibility despite no longer requiring a nursing facility level of care if losing eligibility for PACE would reasonably cause the individual to reacquire the need for a nursing facility level of care within the succeeding six-month period.

The PACE agreement with the provider must designate the area of the state the agreement covers.  This is known as the service area.

There are two PACE providers in Ohio, TriHealth Senior Link and Concordia Care.  The service area for the PACE agreement with TriHealth Senior Link is Hamilton County and certain zip codes in Warren, Butler, and Clermont counties.  Cuyahoga County is the service area for the PACE agreement with Concordia Care.  The Department of Aging is required to carry out the day-to-day administration of the program pursuant to an agreement with the Department of Job and Family Services, which administers Ohio's Medicaid program.[28]

Expansion of PACE program

(Section 209.20)

The act permits the Director of Aging to expand the PACE program to additional regions of Ohio to the extent funding is available.  In implementing the expansion, the Director is prohibited from decreasing the number of residents of Cuyahoga and Hamilton counties and the parts of Butler, Clermont, and Warren counties participating in the PACE program to below the number of participants in those areas who were enrolled in the PACE program on July 1, 2008.

Home first process

(R.C. 173.50 and 173.501)

The act requires the Department of Aging to determine, on a monthly basis, whether individuals who are on a waiting list for the PACE program have been admitted to a nursing facility.  If the Department determines that such an individual has been admitted to a nursing facility, the Department must notify the PACE provider serving the area in which the individual resides about the determination.  The PACE provider is to determine whether the PACE program is appropriate for the individual and whether the individual would rather participate in the PACE program than continue residing in the nursing facility.  If the PACE provider determines that the PACE program is appropriate for the individual and the individual would rather participate in the PACE program than continue residing in the nursing facility, the PACE provider must so notify the Department of Aging.  On receipt of the notice from the PACE provider, the Department must approve the individual's enrollment in the PACE program in accordance with priorities the Director of Aging is authorized to establish in rules.  Each quarter, the Department must certify to the Director of Budget and Management the estimated increase in costs of the PACE program resulting from the enrollments through this home first process.

Kosher home-delivered meals under the PASSPORT program

(R.C. 173.402)

The Pre-Admission Screening System Providing Options and Resources Today (PASSPORT) program is a component of the Medicaid program that provides home and community-based services to eligible individuals age 60 or older as an alternative to care in a nursing facility.  The Department of Aging administers the PASSPORT program pursuant to an interagency agreement with the Department of Job and Family Services.

The act permits an individual enrolled in the PASSPORT program to request that home-delivered meals provided to the individual under the program be kosher.  The Department of Aging or its designee is required, on receipt of such a request from an individual, to ensure that each home-delivered meal provided to the individual under the PASSPORT program is kosher.  In complying with this requirement, the Department or its designee must require each entity that provides home-delivered meals to the individual to provide the individual with meals that meet, as much as possible, the requirements established in the Department's rules governing the PASSPORT program's home-delivered meal service while complying with kosher practices for meal preparation and dietary restrictions.

The act requires that an entity that provides a kosher home-delivered meal to a PASSPORT program enrollee be reimbursed for the meal at a rate equal to the rate for home-delivered meals furnished to PASSPORT program enrollees requiring a therapeutic diet.

Choices Program

(R.C. 173.403)

The Department of Aging administers a Medicaid waiver program called the Choices Program.  The Choices Program provides consumer-driven home and community-based services to participants of the PASSPORT Program.  An individual enrolled in the Choices Program may choose an agency, non-agency professional caregiver, or individual provider such as a friend, neighbor, or relative (other than a spouse, parent, step-parent, or legal guardian) to provide home and community-based services to the individual.[29]

Prior law included references to the Choices Program, but the program was not created in statute.  The act creates the Choices Program in statute (i.e., codifies the program).

The Choices Program was formerly available only in central, northwestern, and southern Ohio regions served by the area agencies on aging based in Columbus, Toledo, Marietta, and Rio Grande.  The act requires that the Choices Program be available statewide, subject to federal approval.

Assisted Living Program

(R.C. 5111.89 and 5111.894)

Continuing law modified by the act permits the Director of Job and Family Services to seek federal approval to create the Assisted Living Program under which eligible individuals are provided certain home and community-based services while residing in a residential care facility (i.e., an assisted living facility).  The Department of Aging administers the Assisted Living Program pursuant to an interagency agreement with the Department of Job and Family Services.

Under prior law, the Assisted Living Program was limited to not more than 1,800 participants.  The act provides instead that the program may not serve more individuals than the number that is set by the federal government when the Medicaid waiver authorizing the program is approved.

The act removes references to the Director's discretion in seeking a waiver to implement the program.  Instead, it specifies in statute that the program is created.

Consolidated federal Medicaid waivers

(R.C. 5111.861; R.C. 173.40, 173.401, 173.403, 5111.89, 5111.891, 5111.894, and 5111.971)

There is a separate federal Medicaid waiver for each of the three Medicaid waiver programs the Department of Aging administers:  the Assisted Living Program, Choices Program, and PASSPORT program.  The act requires the Director of Job and Family Services to submit a request to the United States Secretary of Health and Human Services to obtain a federal Medicaid waiver that consolidates the three programs into one Medicaid waiver program.  The programs are to be operated as separate Medicaid waiver programs until the state receives federal approval for the consolidated federal Medicaid waiver.

In seeking the consolidated federal Medicaid waiver, the Director of Job and Family Services must work with the Director of Aging and provide for the waiver to be available statewide.  In addition, each part of the waiver that concerns a particular program must comply with state law governing the program.

The act requires the Department of Job and Family Services to contract with the Department of Aging for the Department of Aging to administer the consolidated federal Medicaid waiver if the waiver is approved.  However, the Department of Job and Family Services, rather than the Department of Aging, is to administer the part of the waiver that concerns the Assisted Living Program if the Director of Budget and Management does not approve the contract.  Also, on federal approval of the waiver, the Director of Job and Family Services must adopt rules to authorize the Director of Aging to adopt rules that are needed to implement the waiver.  But, the Director of Job and Family Services is to adopt rules that are needed to implement the part of the waiver that concerns the Assisted Living Program if the Director of Budget and Management does not approve the contract between the Departments of Job and Family Services and Aging.  The Director of Aging's rules are to be adopted in accordance with the Administrative Procedure Act (R.C. Chapter 119.).

Home First reports

(R.C. 173.401 and 5111.894)

Continuing law has "Home First" provisions for the Assisted Living Program and PASSPORT Program similar to the provision discussed above that the act establishes for the PACE Program.  The act eliminates a requirement that the Director of Job and Family Services submit to the General Assembly an annual report regarding the number of individuals enrolled in the Assisted Living Program and PASSPORT Program pursuant to the "Home First" provisions and the costs incurred and savings achieved as a result of the enrollments.

Civil penalties against long-term care providers

(R.C. 173.28)

Continuing law prohibits a long-term care provider or other entity or a person employed by a long-term care provider or other entity from subjecting any resident of a long-term care facility[30] or recipient of community-based long-term care services[31] to any form of retaliation, reprisal, discipline, or discrimination for providing information to the Office of the State Long-Term Care Ombudsperson Program, participating in registering a complaint with the Office, or participating in the investigation of a complaint or in administrative or judicial proceedings resulting from a complaint registered with the Office.  Retaliatory actions may include physical, mental, or verbal abuse; change of room assignment; withholding services; and failure to provide care in a timely manner (R.C. 173.24).  A person who violates this prohibition is subject to a fine not to exceed $1,000 per violation (R.C. 173.99(A)).

Continuing law also prohibits a long-term care provider or other entity, or a person employed by a long-term care provider or other entity from denying a representative of the Office of the State Long-Term Care Ombudsperson Program access to a long-term care facility or community-based long-term care site to investigate a complaint (R.C. 173.19(E)).  A person who violates this prohibition is subject to a fine not to exceed $500 per violation (R.C. 173.99(C)).

Continuing law does not specify who imposes and collects the fines described above, but the prohibitions underlying the fines appear to be criminal offenses that constitute minor misdemeanors (R.C. 2901.02(G) and 2901.03).  Continuing law specifies that minor misdemeanors are prosecuted by a county prosecutor, city attorney, or prosecuting authority of a municipality and fines collected for violation of state laws must be paid into the county treasury (R.C. 1901.31(F), 1901.34, and 1907.20(C)).

In lieu of the criminal fines that may be imposed under continuing law, the act permits the Director of Aging to impose civil fines in accordance with the Administrative Procedure Act (R.C. Chapter 119.).  The act specifies that the civil fines imposed by the Director of Aging cannot exceed the following amounts:

(1)  For a violation of the prohibition on retaliation for providing information to the Office of the State Long-Term Care Ombudsperson Program, participating in registering a complaint with the Office, or participating in investigation of a complaint or in administrative or judicial proceedings resulting from a complaint:  $1,000 per incident.  An "incident" is the occurrence of a violation with respect to a resident of a long-term care facility or recipient of community-based long-term care services.  A violation is a separate incident for each day it occurs and for each resident or recipient who is subject to it.

(2)  For a violation of the prohibition on denying a representative of the Office of the State Long-Term Care Ombudsperson Program access to a long-term care facility or community-based long-term care site to investigate a complaint:  $500 for each day a violation continues.

The act requires the Attorney General, on the Director of Aging's request, to bring and prosecute to judgment a civil action to collect any fine imposed by the Director that remains unpaid 30 days after the violator's final appeal is exhausted.  All such fines imposed by the Director must be deposited in the state treasury to the credit of the State Long-Term Care Ombudsperson Program Fund.

Community-based long-term care services

(R.C. 173.392)

Generally, the Department of Aging may not pay a person or government entity for providing community-based long-term care services[32] under a program the Department administers unless the person or government entity is certified by the Department or its designee.[33]  An exception applies if (1) the person or government entity has a contract with the Department or its designee to provide the services, (2) the contract includes detailed conditions of participation for providers of services and service standards that the person or government entity is required to satisfy, (3) the person or government entity complies with the contract, and (4) the contract is not for Medicaid-funded services, other than services provided under the PACE program.

The act revises the exception by expressly providing that the exception also applies if (1) the person or government entity has received a grant from the Department or its designee to provide the services in accordance with a grant agreement, (2) the grant agreement includes detailed conditions of participation for providers of services and service standards that the person or government entity is required to satisfy, (3) the person or government entity complies with the grant agreement, and (4) the grant is not for Medicaid-funded services, other than services provided under the PACE program.

The act expands the preexisting rule-making duties of the Director of Aging by also requiring the Director to adopt rules expressly governing grant agreements between the Department and persons and government entities regarding community-based long-term care services.  The act also provides that the Director's rule-making duties apply with respect to contracts and grant agreements entered into by the Department's designee.

Unified long-term care budget

Interagency agreement regarding unified long-term care budget

(R.C. 173.43)

The act requires the Department of Aging to enter into an interagency agreement with the Department of Job and Family Services under which the Department of Aging is required to establish for each biennium a unified long-term care budget for home and community-based services covered by a component of the Medicaid program the Department of Aging administers.  These components are the following:

(1)  Medicaid waiver services available to a participant in the PASSPORT Program, Choices Program, Assisted Living Program, or any other Medicaid waiver program that the Department administers pursuant to an interagency agreement with the Department of Job and Family Services;

(2)  The following Medicaid state plan services available to a participant in a Department of Aging-administered Medicaid waiver program as specified in Department of Job and Family Services rules:  home health services, private duty nursing services, durable medical equipment, services of a clinical nurse specialist, and services of a certified nurse practitioner;

(3)  Services available to a participant of the PACE Program.

The interagency agreement regarding the unified long-term care budget must require the Department of Aging to do all of the following:

(1)  Administer the budget in accordance with the act's provisions regarding the budget and the General Assembly's appropriations for the home and community-based services for the applicable biennium;

(2)  Contract with each PASSPORT administrative agency for assistance in the budget's administration;

(3)  Provide individuals who are eligible for the home and community-based services a choice of services that meet the individuals' needs and improve their quality of life;

(4)  Provide a continuum of services that meet the life-long needs of individuals who are eligible for the home and community-based services. 

The act requires the Director of Budget and Management to create new appropriation items as necessary for the unified long-term care budget's establishment.

Services to be available under the unified long-term care budget

(R.C. 173.431)

The Department of Aging is required by the act to ensure that the unified long-term care budget is administered in a manner that provides Medicaid coverage of and expands access to three groups of services.  The first group consists of services that the PACE Program covers.  The second group consists of the following state Medicaid plan services as specified in the Department of Job and Family Services' rules:  home health services, private duty nursing services, durable medical equipment, services of a clinical nurse specialist, and services of a certified nurse practitioner.  The third group consists of all of the following Medicaid waiver services provided under Department of Aging-administered Medicaid waiver programs:

(1)  Personal care services;

(2)  Home-delivered meals;

(3)  Adult day-care;

(4)  Homemaker services;

(5)  Emergency response services;

(6)  Medical equipment and supplies;

(7)  Chore services;

(8)  Social work counseling;

(9)  Nutritional counseling;

(10)  Independent living assistance;

(11)  Medical transportation;

(12)  Nonmedical transportation;

(13)  Home care attendant services;

(14)  Assisted living services;

(15)  Community transition services;

(16)  Enhanced community living services;

(17)  All other Medicaid waiver services provided under Department of Aging-administered Medicaid waiver programs.

Care management and authorization services

(R.C. 173.432)

The act requires the Department of Aging or its designee to provide care management and authorization services with regard to the following state Medicaid plan services that are provided to participants of Medicaid waiver programs the Department administers:  home health services, private duty nursing services, durable medical equipment, services of a clinical nurse specialist, and services of a certified nurse practitioner.  The Department or its designee is required to ensure that no person providing the care management and authorization services performs an activity that may not be performed without a valid certificate or license issued by a state agency unless the person holds the valid certificate or license.

Federal approval

(R.C. 173.433)

No provision of the act regarding the unified long-term care budget is to be implemented until the United States Secretary of Health and Human Services approves the provision if federal approval is needed.  The Director of Job and Family Services is required by the act to do one or more of the following as necessary to obtain federal approval:

(1)  Submit one or more state Medicaid plan amendments to the United States Secretary;

(2)  Request one or more federal Medicaid waivers from the United States Secretary;

(3)  Submit one or more federal Medicaid waiver amendments to the United States Secretary.

Rules

(R.C. 173.434)

The act requires the Director of Job and Family Services to adopt rules to authorize the Director of Aging to adopt rules that are needed to implement the provisions of the act regarding the unified long-term care budget.  The Director of Aging's rules are to be adopted in accordance with the Administrative Procedure Act (R.C. Chapter 119.).

Unified Long-Term Care Budget Workgroup (PARTIALLY VETOED)

(Section 209.40)

The act creates the Unified Long-Term Care Budget Workgroup,[34] consisting of the following members:

(1)  The Director of Aging;

(2)  Consumer advocates, representatives of the provider community, representatives of managed care organizations,[35] and state policy makers, appointed by the Governor;

(3)  Two members of the House of Representatives appointed by the Speaker of the House of Representatives, one from the majority party and one from the minority party;

(4)  Two members of the Senate appointed by the President of the Senate, one from the majority party and one from the minority party.

The Director of Aging is to serve as the Workgroup's chairperson.  The Departments of Aging and Job and Family Services are to staff the Workgroup.

The Workgroup is charged with developing a unified long-term care budget that facilitates the following:

(1)  Providing a consumer a choice of services that meet the consumer's health care needs and improve the consumer's quality of life;

(2)  Providing a continuum of services that meet the needs of a consumer throughout life and promote a consumer's independence and autonomy;

(3)  Consolidating policymaking authority and the associated budgets in a single entity to simplify the consumer's decision making and maximize the state's flexibility in meeting the consumer's needs;

(4)  Assuring the state has a system that is cost effective and links disparate services across agencies and jurisdictions.[36]

Progress report on unified long-term care budget

(Section 209.40)

The act requires the Directors of Aging and Budget and Management to annually submit a written report to the Speaker and the Minority Leader of the House of Representatives, the President and the Minority Leader of the Senate, and the members of the Joint Legislative Committee on Medicaid Technology and Reform[37] describing the progress towards establishing, or if already established, the effectiveness of the unified long-term care budget.[38]

Transfer of appropriations

(Section 209.40)

The Director of Budget and Management is authorized by the act to seek Controlling Board approval to transfer cash from the Nursing Facility Stabilization Fund to the PASSPORT/Residential State Supplement Fund in support of the Unified Long-Term Care Budget Workgroup's proposal.[39]

Long-Term Care Consultation Program

(R.C. 173.42, 173.421, 173.422, 173.423, 173.424, and 173.425)

Background

Continuing law requires the Department of Aging to develop the Long-Term Care Consultation Program whereby individuals or their representatives are provided with information through professional consultations about options available to meet long-term care needs and about factors to consider in making long-term care decisions.  The Department may enter into a contract with an area agency on aging or other entity to serve as a program administrator under which the Program for a particular area is administered by the area agency on aging or other entity pursuant to the contract; otherwise, the Program is to be administered by the Department of Aging.

Provision of consultations

(R.C. 173.42 and 173.424)

The act eliminates the requirement that a long-term care consultation be provided to the following individuals unless they are exempt from having a consultation:  (1) nursing facility residents who apply or indicate an intention to apply for Medicaid and (2) nursing facility residents who are likely to spend down their resources within six months after admission to a nursing facility to a level at which they are financially eligible for Medicaid.  The act provides instead that a long-term care consultation may be provided to a nursing facility resident regardless of the source of payment being used for the resident's care in the nursing facility.

The Department of Aging or program administrator is required by the act to provide consultation to an individual identified by the Department or administrator as being likely to benefit from consultation.  To assist the Department or administrator in making this determination, the act provides that the Department or administrator is to have access, except as limited under state or federal law, to data collected from a nursing facility's assessment of its residents.[40]  The Department of Health, Department of Job and Family Services, or nursing facility holding the data is required, under the act, to grant access to the data on receipt of a request from the Department of Aging or program administrator.

The act removes a provision of prior law that exempts an individual from having a consultation when the individual is (1) transferred to another nursing facility or (2) readmitted to a nursing facility after a period of hospitalization.

As under preexisting law, an individual is not forced by the act to have a consultation.  More specifically, the act provides that an individual is not required to be provided a consultation if the individual "refuses to cooperate" rather than, as under prior law, if the individual "chooses to forego" participation.

Law modified by the act provides that a long-term care consultation may be provided at any appropriate time, including either before or after the individual who is the subject of the consultation has been admitted to a nursing facility.  The act provides that a consultation also may be provided before or after such an individual is granted assistance in receiving home and community-based services covered by a component of the Medicaid program the Department of Aging administers.

Under prior law, at the conclusion of the consultation, the Department of Aging or program administrator was required to provide a written summary of options and resources available to meet the individual's needs.  The act eliminates this requirement.  In its place, the act requires the Department or program administrator to assist an individual or individual's representative in accessing all sources of care and services that are appropriate for the individual and for which the individual is eligible, including all available home and community-based services covered by components of the Medicaid program the Department administers.  This assistance is to be provided as part of the Long-Term Care Consultation Program.  The assistance is to include providing for the conduct of assessments or other evaluations and the development of individualized plans of care or services if, under federal law, an individual's eligibility for the home and community-based services is dependent on the assessment, other evaluation, and plan of care or services.  The Department must develop and implement all procedures necessary to comply with the federal law and the procedures must include the use of long-term care consultations.

Periodic or follow-up consultations

(R.C. 173.421)

The Department of Aging is permitted by the act to establish procedures for the conduct of periodic or follow-up long-term care consultations for nursing facility residents, including annual or more frequent reassessments of the residents' functional capabilities.  If the procedures are established, the Department or program administrator must assign individuals to nursing facilities to serve as care managers within the facilities.  To be assigned, an individual must be certified by the Department to provide long-term care consultations.

Program administration

(R.C. 173.42)

Under the act, the Department of Aging and each program administrator is to administer the Long-Term Care Consultation Program in such a manner that all of the following are included:

(1)  Coordination and collaboration regarding funding for long-term care services;

(2)  Assessments of individuals regarding their long-term care service needs;

(3)  Assessments of individuals regarding their on-going eligibility for long-term care services;

(4)  Procedures for assisting individuals in accessing and coordinating health and supportive services, including any waivers administered by the Department;

(5)  Priorities for using resources efficiently and effectively.

The act authorizes the Director of Aging to adopt additional rules for the Program, including rules that specify:

(1)  Criteria and procedures to be used to identify and recommend appropriate service options for an individual receiving a long-term care consultation;

(2)  A description of the types of information from a nursing facility that is needed under the Program to assist a resident with relocation from the facility;

(3)  Standards to prevent conflicts of interest relative to the referrals made by a person who performs a long-term care consultation, including standards that prohibit the person from being employed by a provider of long-term care services;

(4)  Procedures for providing notice and an opportunity for a hearing of a nursing home that may be subject to a fine for failure to permit the Department of Aging or program administrator access to a nursing facility.

Fines

(R.C. 173.42)

Continuing law authorizes the Director of Aging to fine a nursing facility if the facility admits an individual without evidence that a long-term care consultation occurred.  The act, however, eliminates the Director's prior authority to issue a fine if a nursing facility retains an individual without such evidence.

The act permits the Director to fine a nursing facility that denies a person attempting to provide a long-term consultation access to the facility or to a resident of the facility.  It also permits the Director to fine a facility that denies the Department or program administrator access as necessary to administer the Program.  The amounts for the fines are to be determined by rules adopted by the Director.

The act specifies that the Director must give notice and an opportunity for a hearing before imposing a fine.

Monitoring of home and community-based services

(R.C. 173.423)

The act requires the Department of Aging or a program administrator to monitor the subject of a long-term care consultation who is eligible for and elects to receive home and community-based services covered by a component of the Medicaid program the Department administers.  Either or both of the following are to be determined at least once each year:

(1)  Whether the services are appropriate;

(2)  Whether changes in types of services should be made.

Annual report

(R.C. 173.425)

The act requires the Department of Aging to prepare an annual report regarding the individuals who are the subjects of long-term care consultations and elect to receive home and community-based services covered by a component of the Medicaid program the Department administers.  The Department must prepare the report in consultation with the Department of Job and Family Services and Office of Budget and Management.  Each report is to include all of the following information:

(1)  The total savings achieved by providing the home and community-based services rather than services that otherwise would be provided in a nursing facility;

(2)  The average number of days that individuals receive the services before and after receiving nursing facility services;

(3)  A categorical analysis of the acuity levels of the individuals who receive the services;

(4)  Any other statistical information the Department considers appropriate for inclusion in the report.

Ohio's Best Rx Program

(R.C. 127.16, 173.70, 173.99, and 2921.13; R.C. 173.71 to 173.91 (repealed); Section 209.50)

Prior law established the Ohio's Best Rx Program to provide prescription drug discounts to Ohioans who have low incomes, are 60 or older, or are disabled.  Medicaid-eligible individuals and individuals with health benefits covering outpatient drugs were ineligible for the program.  Drug manufacturers seeking to participate in the program could enter into agreements with the Department of Aging to make payments to the program when their drugs were dispensed under the program.  Effective on the act's earliest effective date (July 17, 2009), the act repeals all statutes governing the program.

The act requires the Director of Aging to make every effort to conclude the program's operation within 30 days of the repeal of the program.  Any program accounts with drug manufacturers or pharmacies still in effect are to be settled until October 1, 2009.

The act permits the Director to contract with any person for the operation of a drug discount program to provide prescription drug discounts to individuals who have low incomes (not above 300% of the federal poverty guidelines), are 60 or older, or are disabled.  The act allows the Director to provide information regarding former Best Rx Program participants and applicants to the person under contract.

Ohio Community Service Council

(R.C. 121.40, 121.401, and 121.402)

Under continuing law, the Ohio Community Service Council consists of 21 voting members as follows:  the Superintendent of Public Instruction, the Chancellor of the Ohio Board of Regents, the Director of Youth Services, the Director of Aging, the chairpersons of the Senate and House of Representatives committees dealing with education,[41] and 15 members appointed by the Governor with the advice and consent of the Senate to serve three-year terms.  The appointees must include educators; representatives of youth organizations; students and parents; representatives of organizations engaged in volunteer program development and management throughout Ohio, including youth and conservation programs; and representatives of business, government, nonprofit organizations, social service agencies, veterans organizations, religious organizations, or philanthropies that support or encourage volunteerism within Ohio.  The act adds the Director of the Governor's Office of Faith-based and Community Initiatives as a nonvoting ex officio member of the council.

Under continuing law, the council appoints an executive director for the council.  The act requires the Governor to be informed of the appointment before it is made.

Under former law, beginning on July 1, 1997, the Department of Aging served as the council's fiscal agent.[42]  The council retained any validation, cure, right, privilege, remedy, obligation, or liability.

The act requires the council to enter into an agreement in writing with "another state agency" to serve as the council's fiscal agent.  Before entering into such an agreement, the council must inform the Governor of its terms and of the state agency designated to serve as the fiscal agent.  The fiscal agent will be responsible for all the council's fiscal matters and financial transactions, as specified in the agreement.  The fiscal agent must determine fees to be charged to the council, and the council must pay fees owed to the fiscal agent from a general revenue fund of the council or from any other fund from which the operating expenses of the council are paid.

Formerly, the council, or its designee, had the following authority and responsibility relative to fiscal matters.  Under the act, the council continues to have the following authority and responsibility relative to fiscal matters, but in conjunction and consultation with the fiscal agent.

(a)  Sole authority to draw funds for any and all federal programs in which the council is authorized to participate;

(b)  Sole authority to expend funds from their accounts for programs and any other necessary expenses the council may incur and its subgrantees may incur; and

(c)  Responsibility to cooperate with and inform the fiscal agent fully of all financial transactions.

Services to be provided by the fiscal agent include, but are not limited to, the following:

(1)  Preparing and processing payroll and other personnel documents that the council executes as the appointing authority;

(2)  Maintaining ledgers of accounts and reports of account balances, and monitoring budgets and allotment plans in consultation with the council; and

(3)  Performing other routine support services that the fiscal agent considers appropriate to achieve efficiency.

The act removes provisions that prohibit the council's fiscal agent from approving any payroll or other personnel related documents, or any biennial budget, grant, expenditure, audit, or other fiscal-related document.

In addition to following all state procurement requirements as in continuing law, the act requires the council to follow all state fiscal, human resources, statutory, and administrative rule requirements.

Finally, the act corrects references to the council that refer anachronistically to the "Governor's Community Service Council."

Brain Injury Advisory Committee

(R.C. 3304.231)

The preexisting Brain Injury Advisory Committee is required to advise the Administrator of the Rehabilitation Services Commission and the Brain Injury Program regarding the needs of brain-injury survivors.  Under continuing law, the Committee's membership includes a brain-injury survivor, a relative of a brain-injury survivor, certain health professionals, a Brain Injury Association of Ohio representative, three to five members of the public, and officials from nine specified state agencies.  The act adds the Director of Aging to the Committee.

·         Creates the Sustainable Agriculture Program Fund consisting of money credited to it, including federal money, and requires the Director of Agriculture to use money in the Fund to support activities and programs that advance sustainable agriculture.

·         Eliminates the Commercial Feed, Fertilizer, and Lime Inspection and Laboratory Fund, and credits the money that previously had been credited to that Fund either to the renamed Pesticide, Fertilizer, and Lime Program Fund if the money is collected under the Lime and Fertilizer Law or to the Commercial Feed and Seed Fund created by the act if the money is collected under the Agricultural Seed and Livestock Feeds Laws.

·         Renames the Pesticide Program Fund the Pesticide, Fertilizer, and Lime Program Fund, and requires the money that previously had been credited to the Pesticide Program Fund under the Pesticides Law to be credited to the renamed Fund.

·         Changes the name of the Animal Health and Food Safety Fund to the Animal and Consumer Analytical Laboratory Fund.

·         Changes the name of the Market Development Fund to the Ohio Proud, International, and Domestic Development Fund.

·         Increases or eliminates certain fees under the Nursery Stock and Plant Pests Law, and requires all of the money collected under that Law to be credited to the Plant Pest Program Fund created by the act rather than to the Pesticide Program Fund or the General Revenue Fund as under former law.

·         Revises the funding formula for allocating costs to landowners who want to participate in the Gypsy Moth Suppression Program.

·         Authorizes the Director of Agriculture to assess the operating funds of the Department of Agriculture to pay a share of the Department's central support and administrative costs, and requires assessments to be paid from funds designated in an approved plan and credited to the Department of Agriculture Central Support Indirect Costs Fund created by the act.

·         Increases the annual fee for a license to operate a meat processing establishment or a poultry processing establishment from $50 to $100.

·         Includes poultry dealers in the definition of "dealer" or "broker," and thus in the licensure requirements for dealers and brokers, in the Livestock Dealers Law, and increases some and adds other fees in that Law, including a new late licensure renewal fee for dealers or brokers.

·         Requires small dealers of livestock to be licensed by the Department of Agriculture, defines "small dealer," and establishes requirements and procedures governing small dealers, including a $25 license fee.

·         Requires certain records regarding the acquisition or disposal of animals that must be maintained by dealers or brokers to be maintained for at least 60 months rather than at least 24 months as in prior law, and applies the requirement to small dealers.

·         Requires employees that are appointed by a small dealer, dealer, or broker of livestock to perform certain duties to pay an annual fee of $20.

·         Requires money collected and fines imposed and collected under the Livestock Dealers Law to be credited to the renamed Animal and Consumer Analytical Laboratory Fund rather than to the General Revenue Fund or paid into the state treasury as in prior law.

·         Increases the annual license fee to feed treated garbage to swine from $50 to $100, establishes a fee of $50 for late renewal, and credits the fees to the Animal and Consumer Analytical Laboratory Fund.

·         Requires conveyances to be cleaned and disinfected before they can be used in the feeding of swine, and defines "conveyance."

·         Exempts rendered products from the Garbage-Fed Swine and Poultry Law, and defines "rendered product."

·         Applies the continuing $25 fee for an annual license to pick up or collect raw rendering material or to transport raw rendering material to a composting facility to each conveyance that is used for those purposes, establishes a $10 per-conveyance fee for late renewal applications, and defines "conveyance"; increases the annual license fee to pick up or collect raw rendering material and to operate one or more  rendering plants from $100 per plant to $300 per plant, and establishes a $100 fee for late renewal applications; and requires all money collected for those licenses to be credited to the Animal and Consumer Analytical Laboratory Fund.

·         Eliminates the exemption from licensure under the Rendering Plants Law for operations on any premises that were licensed under the Meat and Poultry Inspection Law or were subject to federal meat inspection and rendered only raw rendering material that was produced on the premises, and exempts holders of nuisance wild animal permits issued by the Division of Wildlife in the Department of Natural Resources and county dog wardens or animal control officers from those licensure requirements.

·         Requires food processing establishments to register annually with the Director of Agriculture and pay a registration fee, and requires the Director to inspect an establishment prior to issuing an initial certificate of registration to ensure that the establishment is in compliance with the Pure Food and Drug Law and with the Bakeries, Canneries and Soft Drink Bottling, Cold Storage and Individual Locker, or Marketing Law, as applicable.

·         Authorizes the Director or the Director's designee to suspend or revoke a food processing establishment registration for specified violations, requires the Director to adopt necessary rules, and exempts certain entities from the food processing establishment registration fee.

·         Eliminates the requirement that the Governor, when submitting a state budget to the General Assembly, had to include in the budget a special purpose appropriation from the General Revenue Fund for the purpose of supplementing the funding available from the continuing Amusement Ride Inspection Fund.

·         Extends through June 30, 2011, the extra 2¢ earmark of wine tax revenue credited to the Ohio Grape Industries Fund.

·         Revises the definition of "Ohio Pet Fund" to specify that it consists of any, rather than all, of the following:  humane societies, veterinarians, animal shelters, companion animal breeders, dog wardens, or similar individuals and entities.

·         With regard to the organizations that may receive financial assistance from the Fund, expands the tax-exempt charitable organizations that may receive assistance to include those tax-exempt charitable organizations that have as one of their purposes, rather than as their primary purpose, the support of programs for the sterilization of dogs and cats and educational programs concerning proper veterinary care.

·         Transfers the administration of the Veterinarian Loan Repayment Program from the Ohio Board of Regents to the State Veterinary Medical Licensing Board.

·         Authorizes money in the Ohio Farm Loan Fund to be used by the Director for rural rehabilitation purposes benefiting the state rather than for rural rehabilitation purposes that were permissible under the charter of the former Ohio Rural Rehabilitation Corporation as agreed upon by the Director and the United States Secretary of Agriculture or for use by the Secretary in accordance with rural rehabilitation agreements with the Director.

·         Creates the Ohio Beekeepers Task Force, and requires it to prepare a report addressing specified topics related to Ohio's bee populations.

 

 

Sustainable Agriculture Program Fund

(R.C. 901.041)

The act creates in the state treasury the Sustainable Agriculture Program Fund consisting of money credited to it, including, without limitation, federal money.  The Director of Agriculture must use money in the Fund to support programs and activities that advance sustainable agriculture, including administrative costs incurred by the Department of Agriculture in administering the programs and activities.

Changes in certain operating and development funds

(R.C. 901.20, 901.43, 905.32, 905.33, 905.331, 905.36, 905.38, 905.381, 905.50, 905.51, 905.52, 905.56, 905.66, 907.13, 907.14, 907.16, 907.30, 907.31, 921.02, 921.06, 921.09, 921.11, 921.13, 921.16, 921.22, 921.27, 921.29, 923.44, and 923.46)

Under former law, money collected from license, registration, inspection, and late renewal fees and penalties under the Lime and Fertilizer Law was credited to the Commercial Feed, Fertilizer, and Lime Inspection and Laboratory Fund.  The act eliminates that Fund and credits the money that previously had been so credited to that Fund to the renamed Pesticide, Fertilizer, and Lime Program Fund (see below).  The act makes necessary conforming changes.

Under prior law, money collected from license, permit, registration, sales report, and inspection fees and penalties under the Agricultural Seed and Livestock Feeds Laws was credited to the Commercial Feed, Fertilizer, and Lime Inspection and Laboratory Fund.  As noted above, the act eliminates that Fund.  It credits the money that previously had been so credited to that Fund to the Commercial Feed and Seed Fund created by the act.  The act requires the Director of Agriculture to keep accurate records of all receipts into and disbursements from the new Commercial Feed and Seed Fund and to prepare, and provide upon request, an annual report classifying the receipts and disbursements that pertain to commercial feed or seed.

Former law specified that money collected from registration, license, inspection, and late renewal fees, specified proceeds, penalties, fines, costs, and damages collected in consequence of violations under the Pesticides Law was credited to the Pesticide Program Fund.  The act renames the Fund the Pesticide, Fertilizer, and Lime Program Fund and requires the money that previously had been so credited to the Pesticide Program Fund to be credited to the renamed Fund.  The act requires the Director to use money in the renamed Fund to administer and enforce the Pesticides and Lime and Fertilizer Laws and rules adopted under those Laws.  As required under former law for the Commercial Feed, Fertilizer, and Lime Inspection and Laboratory Fund, the act requires the Director to keep accurate records of all receipts into and disbursements from the Pesticide, Fertilizer, and Lime Program Fund and to prepare, and provide upon request, an annual report classifying the receipts and disbursements that pertain to pesticides, fertilizers, or lime.

Under law largely retained by the act, money collected by the Director from specified sources related to laboratory services under the Department of Agriculture Law is credited to the Animal Health and Food Safety Fund in the state treasury.  The Director of Agriculture may use money in the Fund to pay the expenses necessary to operate the animal industry and consumer analytical laboratories.  The act changes the name of the Animal Health and Food Safety Fund to the Animal and Consumer Analytical Laboratory Fund.

Finally, the act changes the name of the former Market Development Fund to the Ohio Proud, International, and Domestic Market Development Fund.

Fee changes in Nursery Stock and Plant Pests Law

(R.C. 927.51, 927.52, 927.53, 927.56, 927.69, 927.70, 927.71, and 927.74)

Law revised in part by the act establishes fees for the issuance of nursery stock collector or dealer licenses, phyto sanitary certificates, compliance agreements, and solid wood packing certificates and for inspecting nursery stock under the Nursery Stock and Plant Pests Law.  The act increases or eliminates fees under that Law as follows:

License, certificate, inspection, agreement,
and per acre fee

Former fee

New fee

Nursery stock collector or dealer license

          $ 75

          $ 125

Woody nursery stock inspection

          $ 65

          $ 100

Intensive production areas for woody

nursery stock inspection, per acre

          $   4.50

          $   11

Nonintensive production areas for woody

nursery stock inspection, per acre

          $   3.50

          $     7

Nonwoody nursery stock inspection

          $ 65

          $ 100

Intensive and nonintensive production areas for nonwoody nursery stock inspection, per acre

          $   4.50

          $   11

Phyto sanitary certificate for those collectors or dealers licensed under the Nursery Stock Law

          $ 25

Unchanged

Phyto sanitary certificate for all others

          $ 25

          $ 100

Compliance agreements

          $ 20

          $   40

Solid wood packing certificate

          $ 20

No fee

 

Under prior law, money collected from a portion of the fees discussed above and expenses collected for preventative and remedial measures taken under the Nursery Stock and Plant Pests Law were credited to the Pesticide Program Fund, and the remainder of the fees discussed above, fines, and assessments collected under that Law were credited to the General Revenue Fund.  The act instead requires all of the money to be credited to the Plant Pest Program Fund created by the act and requires the Director to use money in the Fund to administer the Nursery Stock and Plant Pests Law.  The Director must keep accurate records of all receipts into and disbursements from the Fund and must prepare, and provide upon request, an annual report classifying the receipts and disbursements that pertain to plant pests.  Finally, the act makes necessary conforming changes.

Gypsy Moth Suppression Program

(R.C. 927.701)

Continuing law authorizes the Director of Agriculture to establish a voluntary Gypsy Moth Suppression Program under which a landowner may request that the Department of Agriculture have the landowner's property aerially sprayed to suppress the presence of gypsy moths in exchange for payment from the landowner of a portion of the cost of the spraying.  Formerly, in order to determine the amount of payment that was due from a landowner, the Department first had to determine the projected cost per acre to the Department of gypsy moth suppression activities for the year in which the landowner's request was made.  The cost had to be calculated by determining the total expense of aerial spraying for gypsy moths that was to be incurred by the Department in that year divided by the total number of acres proposed to be sprayed in that year.  With respect to a landowner, the Department had to multiply the cost per acre by the number of acres that the landowner requested to be sprayed.  The Department had to add to that amount any administrative costs that it incurs in billing the landowner and collecting payment.  The amount that the landowner had to pay to the Department could not exceed 50% of the resulting amount.

The act revises the funding formula for allocating costs to landowners who want to participate in the Program.  The act requires the Department, in order to determine the total cost per acre, to add the per-acre cost of the product selected by the landowner to suppress gypsy moths and the per-acre cost of applying the product as determined by the Director in rules.  To determine the aggregate total cost, the Department must multiply the total cost per acre by the number of acres that the landowner requests to be sprayed.  The act retains the requirement that the Department add to that amount any administrative costs that it incurs in billing the landowner and collecting payment.  The act also specifies that the portion of the cost that is assessed to the landowner, if any, must be determined by the funding that is allocated to the Department by the federal and state Gypsy Moth Suppression Programs.

Under prior law, money collected under the Program was credited to the Pesticide Program Fund.  As indicated above, the act replaces that Fund with the Plant Pest Program Fund.  It requires money collected under the Program to be credited to the Plant Pest Program Fund created by the act and retains continuing law that requires money so credited to be used for the suppression of gypsy moths.

Central Support and Indirect Costs Fund

(R.C. 901.91)

The act authorizes the Director of Agriculture to assess the operating funds of the Department of Agriculture to pay a share of the Department's central support and administrative costs.  The assessments must be based on a plan that the Director develops and submits to the Director of Budget and Management not later than July 15 of the fiscal year in which the assessments are to be made.  If the Director of Budget and Management approves the plan, assessments must be paid from the funds designated in the plan and credited by means of intrastate transfer voucher to the Department of Agriculture Central Support Indirect Costs Fund, which the act creates in the state treasury.  The Fund must be administered by the Director of Agriculture and used to pay central support and administrative costs of the Department of Agriculture.

Fee for license to operate meat or poultry processing establishment

(R.C. 918.08 and 918.28)

Continuing law requires an applicant for an annual license to operate a meat processing establishment or a poultry processing establishment to pay a fee to the Director of Agriculture before the Director issues the license.  Under prior law, the fee was $50.  The act increases the fee to $100.

Livestock Dealers Law

Changes in definitions and fees

(R.C. 943.01 and 943.04)

Continuing law establishes requirements governing the licensure of livestock dealers and brokers.  Under law generally unchanged by the act, "animals" or "livestock" means horses, mules, and other equidae, cattle, sheep, and goats and other bovidae, swine and other suidae, alpacas, and llamas.  The act adds poultry to the definition.

Under law retained by the act, "dealer" or "broker" means any person found by the Department of Agriculture buying, receiving, selling, slaughtering, with the exception of those persons who slaughter or prepare animals for their own consumption as specified under the Meat Inspection Law, exchanging, negotiating, or soliciting the sale, resale, exchange, or transfer of any animals in an amount of more than 250 head of cattle, horses, or other equidae or 500 head of sheep, goats, or other bovidae, swine and other suidae, alpacas, or llamas during any one year.  The act adds poultry to the 500-head threshold regarding activities performed by a dealer or broker.

Law revised in part by the act establishes fees for the issuance of livestock dealer or broker licenses and livestock weigher licenses under the Livestock Dealers Law.  The act increases or adds fees under that Law as follows:

License fee

Former fee

New fee

For dealers or brokers (except small dealers as discussed below) that purchased, sold, or exchanged less than 1,000 head of livestock in the preceding calendar year

$10

$50

For dealers or brokers that purchased, sold, or exchanged 1,001 to 10,000 head of livestock in the preceding calendar year

$25

$125

For dealers or brokers that purchased, sold, or exchanged more than 10,000 head of livestock in the preceding calendar year

$50

$250

Late renewal fee for dealers or brokers

No fee

$100

Weighers

$5

$10

 

Small dealers of livestock license

(R.C. 943.01, 943.02, 943.031, 943.04, 943.05, 943.06, 943.07, 943.13, and 943.14)

The act requires small dealers of livestock to be licensed under the Livestock Dealers Law.  "Small dealers" means any person found by the Department of Agriculture buying, receiving, selling, slaughtering, with the exception of those persons who slaughter or prepare animals for their own consumption as specified under the Meat Inspection Law, exchanging, negotiating, or soliciting the sale, resale, exchange, or transfer of any animals in an amount of 250 head or less of cattle, horses, or other equidae or 500 head or less of sheep, goats, or other bovidae, swine or other suidae, poultry, alpacas, or llamas during any one year.

The act establishes similar license application requirements and procedures for small dealers as those in continuing law for livestock dealers and brokers, except that it does not require them to maintain or furnish proof of financial responsibility.  Application for a license as a small dealer must be made in writing to the Department.  The application must state the nature of the business, the municipal corporation or township, county, and post-office address of the location where the business is to be conducted, the name of any employee who is authorized to act in the small dealer's behalf, and any additional information that the Department prescribes.

The applicant must satisfy the Department of the applicant's character and good faith in seeking to engage in the business of a small dealer.  The Department then must issue to the applicant a license to conduct the business of a small dealer at the place named in the application.  Licenses, unless revoked, expire annually on March 31 and are renewed in accordance with procedures established in the Standard License Renewal Procedure Law.

No license must be issued by the Department to a small dealer having weighing facilities until the applicant has filed with the Department a copy of a scale test certificate showing the weighing facilities to be in satisfactory condition, a copy of the license of each weigher employed by the applicant, and a certificate of inspection from the Department showing livestock market facilities to be in satisfactory sanitary condition.  No licensed small dealer can employ as an employee a person who, as a small dealer, dealer, or broker, previously defaulted on contracts pertaining to the purchase, exchange, or sale of livestock until the licensee does both of the following:

(1)  Appears at a hearing before the Director of Agriculture or the Director's designee conducted in accordance with the Administrative Procedure Act pertaining to that person; and

(2)  Signs and files with the Director an agreement that guarantees, without condition, all contracts pertaining to the purchase, exchange, or sale of livestock made by the person while in the employ of the licensee.  The Director must prescribe the form and content of the agreement.

The act establishes an annual $25 license fee and a $25 late fee for each license renewal application that is received after March 31.  If a small dealer operates more than one place where livestock is purchased, sold, or exchanged, a fee must be paid for each place, but only the original purchase, sale, or exchange must be counted in computing the amount of fee to be paid for each place operated by the small dealer.  Shipment between yards owned or operated by the small dealer are exempt.

The act applies to small dealers ongoing law governing acting as a dealer or broker without a license, refusal or suspension of a dealer or broker license, posting of a license at the dealer's or broker's place of business, sanitation requirements of livestock yards or vehicles owned or operated by a dealer or broker, inspections of those livestock yards or vehicles, requirements for animals that are sold through those livestock yards, and record keeping requirements (see below) for livestock dealers or brokers or their employees.

Other provisions

(R.C. 943.04, 943.14, and 943.16)

Under law unchanged by the act, a dealer or broker or an employee who acquires or disposes of an animal by any means must make a record of the name and address of the person from whom the animal was acquired and to whom it was disposed.  The requirement also applies to any person who buys or receives animals for grazing or feeding purposes at a premises owned or controlled by that person and sells or disposes of the animals after the minimum grazing or feeding period of 30 days.  Formerly, the records had to be maintained for a period of 24 months or longer from the date of acquisition or disposal.  The act instead requires those records to be maintained for 60 months or longer and applies the requirement to small dealers as discussed above.

The act requires an employee that is appointed by a small dealer, dealer, or broker to act on the small dealer's, dealer's, or broker's behalf to pay a $20 annual fee.

Under former law, the money collected and fines imposed and collected under the Livestock Dealers Law were credited to the General Revenue Fund or paid into the state treasury, as applicable.  The act instead requires the money collected and fines imposed and collected under that Law to be credited to the renamed Animal and Consumer Analytical Laboratory Fund (see above).

Garbage-Fed Swine and Poultry Law

(R.C. 942.01, 942.02, 942.06, and 942.13)

Ongoing law prohibits a person from feeding on the person's premises, or permit the feeding of, treated garbage to swine without a license to do so issued by the Department of Agriculture.  In order to obtain a license, an application must be made on a form prescribed by the Director of Agriculture and must be accompanied by an annual fee.  Under prior law, the fee was $50.  The act increases the garbage-fed swine license fee to $100 per year and establishes a $50 late fee for each license renewal application that is received after November 30.  Prior law did not specify to which fund the money collected from the license fees was to be credited.  The act credits the license fees to the Animal and Consumer Analytical Laboratory Fund.

Under law retained by the act, equipment used for handling garbage, except for containers in which the garbage is treated, must not subsequently be used in the feeding of swine unless first cleaned and disinfected in accordance with directions on the labels of specified disinfectants approved by the Federal Insecticide, Fungicide and Rodenticide Act.  The act adds that conveyances also must be cleaned and disinfected before they can be used in the feeding of swine.  "Conveyance" is defined to mean a vehicle, trailer, or compartment that is used to transport raw rendering material.[43]  As under continuing law governing the cleaning and disinfecting of the premises, vehicles, and equipment used in the feeding of treated garbage to swine, the act states that the owner of a conveyance is responsible for cleaning and disinfecting the conveyance with no expense to the Department of Agriculture.

Additionally, the act specifies that the Garbage-Fed Swine and Poultry Law does not apply to rendered products.  It defines "rendered product" to mean raw rendering material that has been ground and heated to a minimum temperature of 230 degrees Fahrenheit to make products such as animal, poultry, or fish protein, grease, or tallow.

Rendering Plants Law

(R.C. 953.21, 953.22, and 953.23)

With specified exemptions, law revised in part by the act requires a person to apply for a license to pick up or collect raw rendering material or transport raw rendering material to a composting facility from the Department and pay an annual license fee of $25.  The act applies the continuing license fee to each conveyance that is used for those purposes and establishes a $10 per-conveyance fee for late renewal applications that are received after November 30.  It defines "conveyance" to mean a vehicle, trailer, or compartment.  Continuing law also requires a person to apply for a license to pick up or collect raw rendering material and to operate one or more rendering plants and pay an annual license fee for each plant.  Formerly, the fee was $100 per plant.  The act increases the license fee to $300 for each plant and establishes a $100 fee for late renewal applications that are received after November 30.  Prior law did not specify to which fund the money collected from the license fees was to be credited.  The act requires all money that is so collected to be credited to the Animal and Consumer Analytical Laboratory Fund.

Law revised in part by the act exempts certain persons and operations from obtaining a license under the Rendering Plants Law to dispose of, pick up, render, or collect raw rendering material or transport the material to a composting facility.  Under former law, included in the exemptions were operations on any premises that were licensed under the Meat and Poultry Inspection Law or were subject to federal meat inspection and rendered only raw rendering material that was produced on the premises.  The act eliminates that exemption.

Finally, the act exempts both of the following from the Rendering Plants Law:

(1)  A person whose only connection with raw rendering material is trapping wild animals in accordance with a nuisance wild animal permit issued by the Chief of the Division of Wildlife in the Department of Natural Resources; and

(2)  A county dog warden or animal control officer who transports raw rendering material only for disposal purposes.

Food processing establishment registration

(R.C. 915.24 and 3715.041)

Ongoing law requires the Director of Agriculture to adopt rules establishing standards and good manufacturing practices for food processing establishments.[44]  However, a business or portion of a business that is regulated under the Dairy Products Law or the Meat Inspection Law is not subject to regulation under those rules as a food processing establishment.  The act requires a person that operates a food processing establishment to register the establishment annually with the Director.  The person must submit an application for registration or renewal on a form prescribed and provided by the Director.  Except as discussed below, an application for registration or renewal must be accompanied by a registration fee in an amount established in rules adopted by the Director under the act (see below).  If a person files an application for registration on or after August 1 of any year, the fee must be one-half of the annual registration fee.

The act requires the Director to inspect the food processing establishment for which an application for initial registration has been submitted.  If, upon inspection, the Director finds that the establishment is in compliance with the Pure Food and Drug Law and with the Bakeries, Canneries and Soft Drink Bottling, Cold Storage and Individual Locker, or Marketing Law, as applicable, or applicable rules, the Director must issue a certificate of registration to the food processing establishment.  A registration expires on January 31 and is valid until that date unless it is suspended or revoked.  A copy of the food processing establishment registration certificate must be conspicuously displayed in an area of the establishment to which customers of the establishment have access.

A person that is operating a food processing establishment on the effective date of the applicable provisions of the act must apply to the Director for a certificate of registration not later than 90 days after that date.  If an application is not filed with the Director or postmarked on or before 90 days after that date, the Director must assess a late fee in an amount established in rules.

Under the act, a food processing establishment registration may be renewed by the Director.  A person seeking registration renewal must submit an application for renewal not later than January 31.  The Director must issue a renewed certificate of registration on receipt of a complete renewal application.  However, if a renewal application is not filed or postmarked on or before January 31, the Director must assess a late fee in an amount established in rules.  Additionally, the Director cannot renew the registration until the applicant pays the late fee.

Under the act, the Director or the Director's designee may issue an order suspending or revoking a food processing establishment registration upon determining that the registration holder is in violation of the Pure Food and Drug Law or the Bakeries, Canneries and Soft Drink Bottling, Cold Storage and Individual Locker, or Marketing Law, as applicable, or applicable rules.  Generally, a registration cannot be suspended or revoked until the registration holder is provided an opportunity to appeal the suspension or revocation in accordance with the Administrative Procedure Act.  However, if the Director determines that a food processing establishment presents an immediate danger to the public health, the Director may issue an order immediately suspending the establishment's registration without affording the registration holder an opportunity for a hearing.  The Director then must afford the registration holder a hearing in accordance with the Administrative Procedure Act not later than ten days after the date of suspension.

The act requires the Director to adopt rules in accordance with the Administrative Procedure Act that establish all of the following:

(1)  The amount of the registration fee that must be submitted with an application for a food processing establishment registration and with an application for renewal;

(2)  The amount of the late fee for a person that is operating a food processing establishment on the effective date of the applicable provisions of the act and that does not apply for a certificate of registration within 90 days of that date;

(3)  The amount of the fee for the late renewal of a food processing establishment registration if a renewal application is not filed with the Director or postmarked on or before January 31; and

(4)  Any other procedures and requirements that are necessary to administer and enforce the act's food processing establishment registration provisions.

All money that is collected under those provisions must be credited to the Food Safety Fund created in the Cold Storage and Individual Locker Law.

Finally, the act exempts the following entities from paying any food processing establishment registration fee:  home bakeries registered under the Bakeries Law, canneries and soft drink plants licensed under the Canneries and Soft Drink Bottling Law, cold-storage warehouses and other persons licensed under the Cold Storage and Individual Locker Law, and persons that are engaged in egg production and that maintain annually 500 or fewer laying hens.

Amusement ride inspections

(R.C. 1711.58)

Under former law, the Governor, in submitting a state budget to the General Assembly, had to include in the budget a special purpose appropriation from the General Revenue Fund for the purpose of supplementing the funding available from the Amusement Ride Inspection Fund created under the Amusement Rides Law.  The act eliminates that requirement.

Wine tax diversion to Ohio Grape Industries Fund

(R.C. 4301.43)

Continuing law imposes a tax on the distribution of wine, vermouth, and sparkling and carbonated wine and champagne at rates ranging from 30¢ per gallon to $1.48 per gallon.  From the taxes paid, a portion is credited to the Ohio Grape Industries Fund for the encouragement of the state's grape industry, and the remainder is credited to the General Revenue Fund.  Under prior law, the amount credited to the Ohio Grape Industries Fund was scheduled to decrease from 3¢ to 1¢ per gallon on July 1, 2009.  The act extends the extra 2¢ earmarking through June 30, 2011.

Ohio Pet Fund

(R.C. 955.201)

Under ongoing law, the Registrar of Motor Vehicles is authorized to issue a "Pets" license plate to a person who files an application and pays the applicable fees, including a fee that is determined by the Ohio Pet Fund and that is used to support programs for the sterilization of dogs and cats and for educational programs concerning the proper veterinary care of those animals.  Under law changed in part, "Ohio Pet Fund" means a nonprofit corporation that is organized under the Nonprofit Corporation Law that consists of humane societies, veterinarians, animal shelters, companion animal breeders, dog wardens, and similar individuals and entities.  The act changes "and" to "or" in the definition so that the Fund consists of any of those individuals and entities rather than all of them.

Under continuing law, the Fund has certain duties and responsibilities regarding the support of sterilization programs and educational programs.  One of those duties is to establish eligibility criteria for certain types of organizations that may receive financial assistance from the Fund.  Formerly, tax-exempt charitable organizations could receive assistance if their primary purpose was to support programs for the sterilization of dogs and cats and educational programs concerning the proper veterinary care of those animals.  The act expands the tax-exempt charitable organizations that may receive assistance from the Fund to include those that have as one of their purposes, rather than as their primary purpose, the support of programs for the sterilization of dogs and cats and educational programs concerning proper veterinary care.

Veterinarian Loan Repayment Program

(R.C. 4741.41, 4741.44, 4741.45, and 4741.46; Section 515.20)

Under continuing law, the Veterinarian Loan Repayment Program provides loan repayments, for the principal of and interest on a government or other educational loan, for veterinarians who meet certain criteria.  Under prior law, the Ohio Board of Regents administered the Program.  The act transfers the administration of the Program from the Ohio Board of Regents to the State Veterinary Medical Licensing Board.  In doing so, it states that all determinations of the Ohio Board of Regents that were made pursuant to the Program continue in effect as determinations of the State Veterinary Medical Licensing Board until modified or rescinded by the State Veterinary Medical Licensing Board.

Ohio Farm Loan Fund

(R.C. 901.32)

Under continuing law, funds and the proceeds of trust assets that are not authorized to be administered by the United States Secretary of Agriculture under rural rehabilitation agreements with the Director of Agriculture must be paid to and received by the Director.  That money must be credited to the Ohio Farm Loan Fund.  Under prior law, money in the Fund could be used by the Director for rural rehabilitation purposes that were permissible under the charter of the former Ohio Rural Rehabilitation Corporation as agreed upon by the Director and the Secretary or for use by the Secretary in accordance with rural rehabilitation agreements with the Director.  The act instead authorizes money in the Fund to be used by the Director for rural rehabilitation purposes benefiting the state.

Ohio Beekeepers Task Force

(Section 709.10)

The act creates in the Department of Agriculture the Ohio Beekeepers Task Force consisting of the following members:

(1)  Two members of the standing committee of the House of Representatives that is primarily responsible for considering agricultural matters appointed by the Governor, each from a different political party;

(2)  Two members of the standing committee of the Senate that is primarily responsible for considering agricultural matters appointed by the Governor, each from a different political party;

(3)  The Chief of the Division of Plant Industry in the Department of Agriculture or the Chief's designee;

(4)  The Director of Natural Resources or the Director's designee;

(5)  Two representatives of the Ohio State Beekeepers Association appointed by the Association;

(6)  The Director of The Ohio State University Extension or the Director's designee;

(7)  An apiculture specialist of The Ohio State University Extension appointed by the Director of The Ohio State University Extension;

(8)  The Chair of The Ohio State University Department of Entomology or the Chair's designee;

(9)  A representative of the Ohio Produce Growers and Marketing Association appointed by the Association;

(10)  A representative of the Ohio Farm Bureau Federation Bee and Honey Committee appointed by the Federation;

(11)  A representative of the Ohio Farmers Union appointed by the Union; and

(12)  A representative of the County Commissioners Association of Ohio appointed by the Association.

The act requires the members to be appointed no later than 60 days after the effective date of those provisions of the act.  The Task Force must hold its first meeting no later than 90 days after that effective date.  The Governor must select a chairperson and vice-chairperson from among the members of the Task Force, and the chairperson may appoint a secretary.  The members of the Task Force are to receive no compensation for their services.

The act requires the Task Force, no later than ten months after the effective date of those provisions of the act, to submit a report to the Governor, the President of the Senate, the Speaker of the House of Representatives, and the Ohio State Beekeepers Association.  The report must do all of the following:

(1)  Provide an overview of the characteristics of the honeybee crisis in Ohio;

(2)  Examine and provide an overview of and conclusions regarding whether pollinator shortages are affecting crop pollination in Ohio;

(3)  Review and provide an overview of the Ohio Honeybee Emergency Action Plan;

(4)  Review and provide a summary of the federal initiatives regarding Ohio's bee population and of all of the Department of Agriculture's and the Ohio State Beekeepers Association's programs concerning Ohio's bee population;

(5)  Provide an overview of the five-year goals of the Department of Agriculture concerning honeybees, including recommendations for the restoration of Ohio's bee population;

(6)  Examine and describe the funding that is available for honeybee programs and issues affecting honeybees; and

(7)  Any other issues that the Task Force considers appropriate.

Not later than 90 days following the submission of the report, the Task Force must meet and respond to any question from a person who received the report.  The Task Force ceases to exist upon submitting its response to all questions from persons who received the report.

 

·         Requires the Ohio Air Quality Development Authority (OAQDA) to establish the Energy Strategy Development Program for the purpose of developing energy initiatives, projects, and policy for the state.

·         Creates the Energy Strategy Development Fund, which is to be used for purposes of the Program.

·         Authorizes OAQDA, in accordance with the federal Internal Revenue Code, to allocate the national Qualified Energy Conservation Bond limitation allocated to Ohio and to reallocate any portion of an allocation waived by a county or municipality.

·         Adds as "advanced energy projects" eligible for funding by OAQDA through bond proceeds or by the Department of Development using money from electric ratepayers any technologies, products, activities, or management practices or strategies that facilitate the generation or use of energy.

·         Adds coal-mine methane gas as an energy resource that qualifies as an advanced energy project and as a resource electric distribution utilities and electric services companies can use to meet alternative energy benchmarks.

 

 

Energy Strategy Development Program

(Section 213.20)

The act requires the Ohio Air Quality Development Authority (OAQDA) to establish the Energy Strategy Development Program for the purpose of developing energy initiatives, projects, and policy for the state.  Issues addressed by the initiatives, projects, and policy are not to be limited to those governed by the continuing Air Quality Development Authority Law (R.C. Chapter 3706.).  The act also creates the Energy Strategy Development Fund, which is a fund created in the state treasury.  The Fund is to consist of money credited to it and money obtained for advanced energy projects from federal or private grants, loans, or other sources.  Money in the Fund must be used to carry out the purposes of the Energy Strategy Development Program.  Interest earned on the Fund is to be credited to the GRF.  The Fund is abolished on July 1, 2012, or as soon as possible thereafter, with remaining cash credited to the GRF.

Allocation of the Qualified Energy Conservation Bond limitation

(R.C. 3706.04)

Federal law provides that a state or local government may issue Qualified Energy Conservation Bonds (QECBs) and use their proceeds for qualified conservation purposes, such as capital expenditures incurred for reducing energy consumption in publically-owned buildings by at least 20% or for certain expenses related to advanced or renewable energy development or commercialization.  In turn, federal law permits a QECB bondholder to receive a federal tax credit.

Federal law creates a cap on the volume of QECBs that may be issued nationally and provides for the allocation of this total cap among the states in proportion to their populations.  It also requires that within each state, a percentage of the QECBs allocated to that state must be allocated to each large local government--defined as a county or municipality with a population of at least 100,000 people.[45]

The act authorizes OAQDA to allocate the national QECB limitation that is allocated to Ohio by the federal government and to reallocate any portion of an allocation waived by a county or municipality in accordance with the federal law discussed above.

Advanced energy

(R.C. 3706.25 and 4928.01)

Under continuing law, the Department of Development may provide grants, contracts, loans, loan participation agreements, linked deposits, and energy production incentives for advanced energy projects, and the OAQDA may provide grants and loans for advanced energy projects.  Development's program is financed through a temporary surcharge on electric rates; OAQDA's program is financed from the proceeds of state-issued revenue bonds and other available money.[46]

The act changes the definition of "advanced energy project" for both programs, so that such a project can include any technologies, products, activities, or management practices or strategies that facilitate the generation or use of energy--not just the generation or use of electricity, as in ongoing law--and that reduce or support the reduction of energy consumption or support the production of clean, renewable energy.

Continuing law can include as an "advanced energy project" renewable energy resources and advanced energy resources.  The act adds methane gas emitted from an abandoned coal mine as a renewable energy resource under the OAQDA law and methane gas emitted from an operating or abandoned coal mine as an advanced energy resource for purposes of the Development law.  Also, the addition to what qualifies as an advanced energy resource has the effect of adding coal-mine methane gas to the types of resources that electric distribution utilities and electric services companies can use to meet the alternative energy benchmarks specified in electric restructuring law.[47]

 

·         Requires the Ohio Department of Alcohol and Drug Addiction Services (ODADAS) to make a warning sign regarding anabolic steroids available on its Internet web site rather than print and distribute the sign.

·         Requires each board of alcohol, drug addiction, and mental health services (ADAMHS board) to submit annual reports to ODADAS specifying how the board used state and federal funds allocated to it for administrative functions in the year preceding each report's submission.

·         Expressly authorizes ODADAS, in consultation with ODMH, to establish and maintain more than one information system (rather than one system) to aid in formulating a comprehensive statewide alcohol and drug addiction services plan and determining the effectiveness and results of alcohol and drug addiction services, and similarly expressly authorizes ODMH to develop and operate more than one community mental health system (rather than one system).

·         Changes the prohibition on the collection of information by ODADAS and ODMH from ADAMHS boards to specify that the prohibition is on the collection of personal information except as permitted or required (rather than just required) by state or federal law and adds that it must be for purposes relating to payment, health care operations, program and service evaluation, reporting activities, research, system administration, and oversight.

·         Provides that the $50 immobilization waiver fee that a county or municipal court must impose in certain cases involving a motor vehicle that is subject to immobilization must be deposited into the indigent drivers alcohol treatment fund under the control of that court rather than into the state treasury to the credit of the state Indigent Drivers Alcohol Treatment Fund.

·         Requires each ADAMHS board and alcohol and drug addiction services board to submit detailed annual reports to ODADAS for each indigent drivers alcohol treatment fund in that board's area.

·         Adds the ODADAS Director, or the Director's designee, to the Ohio Commission on Fatherhood.

 

 

Anabolic steroid warning sign

(R.C. 3793.02)

Continuing law requires that a warning about anabolic steroids be posted in the locker rooms of (1) school buildings that include any grade higher than sixth grade, (2) recreational and athletic facilities operated by the university or college for use by students, and (3) every athletic facility.[48]  The warning must read as follows:

"Warning:  Improper use of anabolic steroids may cause serious or fatal health problems, such as heart disease, stroke, cancer, growth deformities, infertility, personality changes, severe acne, and baldness.  Possession, sale, or use of anabolic steroids without a valid prescription is a crime punishable by a fine and imprisonment."

Prior law required ODADAS to print and distribute the warning sign.  The act requires ODADAS to make the warning sign available on its Internet web site rather than print and distribute it.

Annual reports on use of state and federal funds for administrative functions

(R.C. 3793.21)

Continuing law requires ODADAS to establish a comprehensive, statewide alcohol and drug addiction services plan (R.C. 3793.04, not in the act).  The plan must provide for the allocation of state and federal funds for services furnished by alcohol and drug addiction programs under contract with boards of alcohol, drug addiction, and mental health services (ADAMHS boards)[49] and must specify the methodology ODADAS will use to determine how funds will be allocated and distributed.  Each board is required to submit its own plan to ODADAS that serves as the board's application for funds (R.C. 3793.05, not in the act).  ODADAS must distribute funds to a board if it approves the board's plan.

The act requires each ADAMHS board to submit annual reports to ODADAS specifying how the board used state and federal funds allocated to it (according to the methodology specified by the statewide alcohol and drug addiction services plan) for administrative functions[50] in the year preceding each report's submission.  The act requires the ODADAS Director to establish the date by which the report must be submitted each year.

Information systems maintained by ODADAS and ODMH

(R.C. 3793.04 (primary), 340.033, and 5119.61)

Under prior law, ODADAS was required to establish and maintain a single information system to aid it in formulating a comprehensive statewide alcohol and drug addiction services plan.  Similarly, the Ohio Department of Mental Health (ODMH) had to establish a single community mental health information system.  ADAMHS boards[51] were required to provide certain information for these systems, but ODMH and ODADAS were prohibited from collecting from the ADAMHS boards any information for the purpose of identifying by name any person who received a service through a board, except when the collection was required by state or federal law to validate appropriate reimbursement.

The act expressly authorizes ODADAS, in consultation with ODMH, to establish more than one information system (rather than just one system) to aid it in formulating a comprehensive statewide alcohol and drug addiction services plan and in determining the effectiveness and results of alcohol and drug addiction services.  The act also expressly authorizes ODMH to develop and operate more than one community mental health information system.

The act specifies that the prohibition on the collection of information by ODADAS and ODMH from ADAMHS boards is on the collection of personal information about persons who receive ADAMHS board services, except when personal information collection is permitted or required (rather than just required) by state or federal law.  The act adds that the collection of personal information by ODADAS and ODMH must be for purposes relating to payment, health care operations, program and service evaluation, reporting activities, research, system administration, and oversight.[52] 

Indigent drivers alcohol treatment funds

(R.C. 4503.235 and 4511.191)

Prior and continuing law

There exists in the state treasury the Indigent Drivers Alcohol Treatment Fund.  Pursuant to continuing law, each county has established an indigent drivers alcohol treatment fund and a juvenile indigent drivers alcohol treatment fund, while each municipal corporation in which there is a municipal court has established an indigent drivers alcohol treatment fund.  These three kinds of funds are under the control of their respective courts.  Under prior law, the state fund consisted of $37.50 of each $475.00 OVI-related driver's license reinstatement fee that the Registrar of Motor Vehicles collects, the motor vehicle immobilization waiver fee of $50 that is imposed in certain cases involving the immobilization of a motor vehicle, and the $100 application fee manufacturers pay to have their ignition interlock devices certified by the Department of Public Safety.

Continuing law requires ODADAS to distribute the money in the state's Indigent Drivers Alcohol Treatment Fund to the county indigent drivers alcohol treatment funds, the county juvenile indigent drivers alcohol treatment funds, and the municipal indigent drivers alcohol treatment funds.  These funds also receive $1.50 of an additional court cost of $10 that is imposed on an offender who is convicted of a motor vehicle moving violation, $1.50 of an additional bail amount of $10 that is imposed on an offender who is charged with a motor vehicle moving violation and is convicted of the violation or forfeits the bail, $25 or $50 of each fine imposed on a first-time state OVI offender, 50% of each fine imposed on an offender who commits the offense of driving under OVI suspension, and $25 of each fine imposed on a local OVI offender.

The county, juvenile, and municipal courts may use the money in their respective funds only to pay the cost of an alcohol and drug addiction treatment program attended by an offender or juvenile traffic offender who is ordered to attend an alcohol and drug addiction treatment program by a county, juvenile, or municipal court judge and who is determined by the judge not to have the means to pay for the person's attendance at the program or to pay certain other specified costs.  In addition, a county, juvenile, or municipal court judge may use money in that court's indigent drivers alcohol treatment fund to pay for the cost of the continued use of an alcohol monitoring device in certain circumstances.  Money in the state fund that ODADAS does not distribute to a county indigent drivers alcohol treatment fund, a county juvenile indigent drivers alcohol treatment fund, or a municipal indigent drivers alcohol treatment fund because the ODADAS Director does not have the information necessary to identify the county or municipal corporation where the offender or juvenile offender was arrested may be transferred by the Director of Budget and Management to the existing Statewide Treatment and Prevention Fund upon certification of the amount by the ODADAS Director.

Changes made by the act

The act makes one change from prior law in the revenue sources for the state Indigent Drivers Alcohol Treatment Fund and the local indigent drivers alcohol treatment funds:  it requires the court clerk to deposit the $50 vehicle immobilization fee that is imposed in certain cases involving the immobilization of a motor vehicle into the appropriate county or municipal indigent drivers alcohol treatment fund under the control of that court instead of into the state Indigent Drivers Alcohol Treatment Fund.

Annual reports by ADAMHS boards

The act requires each ADAMHS board[53] to submit to ODADAS an annual report of each local indigent drivers alcohol treatment fund in that board's area.  The report, which must be submitted not later than 60 days after the end of the state fiscal year, must provide the total payment that was made from the fund, including the number of indigent consumers that received treatment services and the number of indigent consumers that received an alcohol monitoring device.  The report also must identify the treatment program and expenditure for an alcohol monitoring device for which that payment was made and include the fiscal year balance of each indigent drivers alcohol treatment fund located in that board's area.  If a surplus is declared in a fund, as permitted by continuing law, the act requires the report to provide the total payment that was made from the surplus money and identify the treatment program and expenditure for an alcohol monitoring device for which that payment was made.  ODADAS may require additional information necessary to complete the comprehensive statewide Alcohol and Drug Addiction Services Plan as required by continuing law.  If an ADAMHS board is unable to obtain adequate information to develop the report to submit to ODADAS for a particular indigent drivers alcohol treatment fund, the board must submit a report detailing the effort made to obtain the information.

ODADAS representation on the Ohio Commission on Fatherhood

(R.C. 5101.34)

The Ohio Commission on Fatherhood, created by preexisting law, is required to organize a state summit on fatherhood every four years and prepare an annual report that identifies resources available to fund fatherhood-related programs and explores the creation of fatherhood initiatives.  The act adds the ODADAS Director or the Director's designee to the Commission's membership, for a total of 20 members.

 

·         Expands the licensing authority of the Ohio Athletic Commission to cover private competitions and public and private competitions involving not only boxing and wrestling but also martial arts.

·         Requires that an applicant for a promoter's license to conduct a public or private competition involving boxing or martial arts that is issued by the Commission submit a surety bond of not less than $20,000, rather than $5,000.

·         Eliminates (1) surety bonding for wrestling promoters, (2) the option to provide a cash bond, certified check, or a bank draft instead of a surety bond for a promoter's license, and (3) the requirement that the applicant for a promoter's license verify the application under oath.

·         Changes the information that appears on a boxing or wrestling or martial arts promoter's license issued by the Commission.

·         Requires the Commission to adopt rules that require the examination by appropriate medical personnel of contestants before and after competitions.

·         Specifies that fines imposed against licensees for violations are to be determined by Commission rule.

·         Authorizes the Commission to revoke, suspend, or refuse to renew a license if the licensee has been convicted of theft, bribery of a public official, or corruption of a sport, or associates or consorts with any person who has been convicted of a crime that involves a sport the Commission regulates, including a conviction for theft, bribery of a public official, or corruption of a sport.

 

 

Expansion of Ohio Athletic Commission licensing authority

(R.C. 3773.35, 3773.36, and 3773.43)

Any person who wishes to conduct a public boxing or wrestling match or exhibition apply to the Ohio Athletic Commission for a promoter's license.  The act expands this licensing requirement also to cover private competitions, and any public or private competition that involves wrestling, boxing, mixed martial arts, kick boxing, tough man contests, tough guy contests, or any other form of boxing or martial arts.

Evidence of financial security that a promoter must submit with a license application and verification of the application

(R.C. 3773.35 and 3773.36)

Prior law required that an application for a promoter's license to be accompanied by a cash bond, certified check, bank draft, or surety bond of not less than $5,000.  The act requires instead that the applicant submit only a surety bond of not less than $20,000, removes the option to provide a cash bond, certified check, or a bank draft, and eliminates the requirement that applicants for a wrestling promoter's license submit a surety bond.

The act also removes a requirement that the applicant verify the application under oath.

Information contained on a boxing or martial arts or wrestling promoter's license

(R.C. 3773.36)

Under prior law, each boxing or wrestling promoter's license issued by the Ohio Athletic Commission had to bear, among other things, the date of issue, a serial number designated by the Commission, and the signature of the Commission chairperson.  The act, reflecting the other amendments that expand the licensing authority to include martial arts, instead requires that each boxing or wrestling or martial arts promoter's license bear the date of expiration and an identification number designated by the Commission and eliminates the requirement for the signature of the Commission chairperson.

Commission rules regarding medical examination before and after bouts the Commission regulates

(R.C. 3773.45)

Prior law required that each contestant in a public boxing match or exhibition be examined not more than 24 hours before entering the ring by specified medical personnel and immediately after the end of a match or exhibition if the contestant was knocked out.  Medical personnel are prohibited from certifying a contestant as physically fit to compete if the contestant was knocked out in a contest that occurred within the preceding 30 days.

The act eliminates the requirements described in the preceding paragraph and instead requires the Commission to adopt, and authorizes the Commission to amend or rescind, rules that require the physical examination by appropriate medical personnel of each contestant in any public competition that involves boxing, mixed martial arts, kick boxing, karate, tough man contestant, or any other form of boxing or martial arts within a specified time period before and after the competition to determine whether the contestant is physically fit to compete in the competition under specified standards, has sustained physical injuries in the competition, or requires a follow-up examination, and require the reporting of each such examination to the Commission.  (R.C. 3773.45 (A).)

Fines for violation of the Ohio Athletic Commission Law

(R.C. 3773.53)

The Ohio Athletic Commission, in addition to any other action it may take, is authorized to impose a fine of not more than $100 against any person licensed by the Commission for a violation of any provision of the Ohio Athletic Commission Law.  The act provides that the amount of such a fine will be determined by Commission rule.  (R.C. 3773.53(G).)

Grounds for Ohio Athletic Commission to revoke, suspend, or refuse to renew a license

(R.C. 3773.53)

The Ohio Athletic Commission may revoke, suspend, or refuse to renew a license if a licensee of the Commission is associating or consorting with any person who has been convicted of a crime.  The act limits the Commission's authority to situations where the licensee is associating or consorting with any person who has been convicted of a crime involving the sports regulated by the Commission, including a conviction under sections 2913.02, 2915.05, or 2921.02 of the Revised Code (for theft, bribery of a public official, or corruption of a sport, respectively).  The act gives the Commission authority also to revoke, suspend, or refuse to renew a license if a licensee has been convicted of or pleaded guilty to a violation of those same Revised Code sections.  (R.C. 3773.53(B).)

Clarification of Ohio Athletic Commission fee statute

(R.C. 3773.43)

In light of its other amendments, the act clarifies the statute that prescribes the fees that are charged by the Ohio Athletic Commission.  First, the act specifies that the $100 application and renewal fee for a promoter's license applies not only with regard to public competitions, but also to private competitions, and applies not only with regard to boxing but also to mixed martial arts, kick boxing, tough man contests, tough guy contests, and any other form of boxing or martial arts.  Second, the act specifies that the $200 application and renewal fee with regard to wrestling matches or exhibitions applies, not with regard to professional wrestling matches or exhibitions, but with regard to public or private competitions involving wrestling.

 

·         Replaces the requirement that administrative rules adopted by the Attorney General regarding peace officer training specify that the training include and the requirement that state, county, municipal, and Department of Natural Resources peace officer basic training programs include a minimum of 15 hours of training in handling domestic violence relations matters and six hours of training in crisis intervention with a general requirement for training in those two areas.

·         Requires each agency or entity that appoints or employs one or more peace officers to report to the Ohio Peace Officer Training Commission (OPOTC) the guilty plea to a felony or a specified misdemeanor of any person who is serving the agency or entity in a peace officer capacity.

·         Requires certain peace officers who terminate employment and are subsequently hired as peace officers to complete an unspecified amount of training in crisis intervention instead of six hours of such training.

·         Authorizes the Executive Director of the OPOTC to exempt from peace officer training requirements a person who has service equivalent to 16 years of full-time active service as a peace officer.

·         Modifies the amount of attorney's fees incurred to obtain a restraining order, custody order, or other order to separate a victim from an offender that are an "allowable expense" under the Crime Victims Reparations Law.

·         Modifies the fee an applicant must pay for a license, renewal of a license, or an emergency license to carry a concealed handgun and modifies the procedure for the distribution of the fee.

·         Requires the sheriff to waive the payment of the fee for an emergency license to carry a concealed handgun for specified retired peace officers and retired law enforcement officers.

·         Requires the Attorney General to publish its pamphlet on firearms laws on the Attorney General's web site, eliminates requirements for distribution of copies of the pamphlet, and requires the Attorney General and firearms trainers to provide the address of that web site to trainees and applicant to a license to carry a concealed handgun.

·         Creates a statutory form for an application to renew a license to carry a concealed handgun, requires a sheriff to conduct criminal records and incompetency checks of an applicant for renewal only from the date of the applicant's last application, and authorizes submission of an expired license as prima-facie evidence that an applicant for renewal at one time had an appropriate competency certification.

·         For purposes of the prohibition against improperly handling firearms in a motor vehicle, provides that ammunition held in stripper-clips or in en-bloc clips is not considered ammunition that is loaded into a magazine or speed loader.

 

 

Peace officer training and reporting requirements

Hours of training in certain areas

(R.C. 109.73(A)(4) and (5), 109.742, 109.744(A), and 109.77(B)(3))

Prior law required the Ohio Peace Officer Training Commission (OPOTC) to recommend rules to the Attorney General (AG) that peace officer training programs include at least 15 hours of training in handling domestic relations matters, at least six hours in crisis intervention, and a "specified amount" in handling cases involving missing children and child abuse and neglect.  The act eliminates the references to specific numbers of hours of such training and to a "specified amount" of training in the indicated areas and requires instead that OPOTC recommend rules to the AG that the training programs include such training.

Prior law required the Attorney General to adopt rules that required peace officer training programs to include at least 15 hours of training in handling domestic relations matters and at least six hours in crisis intervention and required a state, county, municipal, or Department of Natural Resources peace officer basic training program to include those types and amounts of training.  The act eliminates the references to specific numbers of hours of such training and requires instead that the rules specify the amount of those types of training required and that the programs include those types of training.

Prior law required a person who was serving as a peace officer on April 4, 1985, and who subsequently terminated that employment to complete six hours of training in crisis intervention before being employed again as a peace officer.  The act eliminates the six hours of required training in crisis intervention and replaces it with the amount of such training prescribed in the rules adopted by the Attorney General.

Agency reports to OPOTC

(R.C. 109.761(A)(1)(b))

Under continuing law, each agency or entity that appoints or employs any peace officers must report certain information regarding the appointments or employment to the OPOTC.  That information includes the "termination, felony conviction, or death" of any peace officer appointed or employed.  The act adds to the information that must be reported any plea of guilty to a felony committed on or after January 1, 1997, and any plea of guilty to a misdemeanor committed on or after January 1, 1997, pursuant to a negotiated plea agreement under R.C. 2929.43(D) in which the peace officer agrees to surrender a certificate of satisfactory completion of an approved peace officer training program issued by the Executive Director of the OPOTC.

Exemption from peace officer training requirements

(R.C. 109.77(H)(1))

Under continuing law, a person who was employed as a peace officer of a county, township, or municipal corporation on January 1, 1966, and who has completed at least 16 years of full-time active service as such a peace officer may receive an original appointment on a permanent basis and serve as a peace officer of a county, township, or municipal corporation, or as a state university law enforcement officer without having to receive a certificate from the Executive Director of the OPOTC of completion of an approved peace officer training program.  The act extends the exemption to a person who has service equivalent to 16 years of full-time active service as a peace officer, as determined by the Executive Director.

Reparations Fund and Crime Victims Reparations Law--payment of attorney's fees incurred to obtain a restraining order, custody order, or other order to separate a victim from an offender

(R.C. 2743.51)

The act modifies the amount of attorney's fees incurred to obtain a restraining order, custody order, or other order to separate a victim from an offender that are an "allowable expense" under the Crime Victims Reparations Law (and, thus, that may be awarded to a crime victim under that Law).  Previously, "allowable expense" included attorney's fees not exceeding $2,500, at a rate not exceeding $150 per hour, incurred for the specified services, if the attorney had not received payment under R.C. 2743.65 for assisting a claimant with a reparations award application.  Under the act:  (1) "allowable expense" includes attorney's fees not exceeding $1,320, at a rate not exceeding $60 per hour, incurred for those services, if the attorney has not received payment under R.C. 2743.65 for assisting a claimant with a reparations award application and provided that, except as described in clause (2), the attorney or the attorney's law firm may only receive attorney's fees as an allowable expense for the services in an amount that does not exceed a cumulative total of $30,000 in any calendar year, (2) the $30,000 maximum described above does not apply to an attorney employed by a legal aid society regarding the specified services the attorney performs while so employed and does not apply to a legal aid society, and (3) attorney's fees for the specified services may include an amount for reasonable travel time incurred while performing them, assessed at a rate not exceeding $30 per hour.

Concealed carry licenses

Amount of fee

(R.C. 109.731(C), 2923.125(B)(1) and (F), and 2923.1213)

Prior law

Prior law required an applicant for a license to carry a concealed handgun or for the renewal of a license to carry a concealed handgun under R.C. 2923.125 to submit a nonrefundable license fee prescribed by the Ohio Peace Officer Training Commission (OPOTC) to the sheriff of the county in which the applicant resided or to the sheriff of any county adjacent to the county in which the applicant resided, except that the sheriff had to waive the payment of the license fee for certain specified persons.  Prior law specified that OPOTC, in consultation with the Attorney General, had to prescribe a fee to be paid by an applicant for a license to carry a concealed handgun or for the renewal of a license to carry a concealed handgun as follows:

(1)  For an applicant who had been a resident of Ohio for five or more years, an amount that did not exceed the lesser of the actual cost of issuing the license, including, but not limited to, the cost of conducting a criminal records check, or whichever of the following is applicable:

(a)  For an application made on or after March 14, 2007, $55;

(b)  For an application made prior to March 14, 2007, $45;

(2)  For an applicant who had been a resident of Ohio for less than five years, an amount that consisted of the actual cost of having a criminal background check performed by the Federal Bureau of Investigation (FBI), if one was so performed, plus the lesser of the actual cost of issuing the license, including, but not limited to, the cost of conducting a criminal records check, or whichever of the following is applicable:

(a)  For an application made on or after March 14, 2007, $55;

(b)  For an application made prior to March 14, 2007, $45.

Prior law also required a person seeking a temporary emergency license to carry a concealed handgun under R.C. 2923.1213 to submit to the sheriff of the county in which the person resided a temporary emergency license fee established by OPOTC for an amount that did not exceed the actual cost of conducting the criminal background check, or $30.

Operation of the act

For a license to carry a concealed handgun issued under R.C. 2923.125, the act replaces the fees described above in "Existing law" and the requirement that OPOTC prescribe the fees with the following statutory fees:

(1)  For an applicant who has been a resident of this state for five or more years, a fee of $67 for an initial license or $50 for renewal of a license;

(2)  For an applicant who has been a resident of Ohio for less than five years, a fee of $67 for an initial license or $50 for renewal of a license plus, in either case the actual cost of having a background check performed by the FBI.

The act also specifies that no sheriff may require an applicant to pay for the cost of a background check performed by BCII.

For an emergency license to carry a concealed handgun issued under R.C. 2923.1213, the act replaces the existing fee described above in "Existing law" with the following:

(1)  For an applicant who has been a resident of this state for five or more years, a fee of $15 plus the actual cost of having a background check performed by BCII pursuant to R.C. 311.41;

(2)  For an applicant who has been a resident of this state for less than five years, a fee of $15 plus the actual cost of having background checks performed by the FBI and BCII pursuant to R.C. 311.41.

Deposit and distribution of fee

(R.C. 311.42 and 2923.125(B)(1)(c))

Prior and continuing law

Continuing law specifies that each county must establish in the county treasury a sheriff's concealed handgun license issuance expense fund.  Under prior law, the sheriff of that county had to deposit into that fund all fees paid by applicants for the issuance or renewal of a license or duplicate license to carry a concealed handgun under R.C. 2923.125 and all fees paid by the person seeking a temporary emergency license to carry a concealed handgun under R.C. 2923.1213.  OPOTC, in consultation with the Attorney General, had to specify the portion of the concealed carry license fee that was used to pay each particular cost of the issuance of the license.  The county had to distribute the fees deposited into the fund in accordance with those specifications.

Operation of the act

The act eliminates the requirement in prior law that OPOTC, in consultation with the Attorney General, had to specify the portion of the concealed handgun license fee that would be used to pay each particular cost of the issuance of the license and eliminates the requirement that the county must distribute the fees deposited into the fund in accordance with those specifications.  Instead, the act specifies that the county must distribute all fees deposited into the fund except $40 of each fee paid by an applicant for an initial license issued under R.C. 2923.125(B), $35 of each fee paid by an applicant for a renewal of a license under R.C. 2923.125(F), and $15 of each fee paid for an emergency license issued under R.C. 2923.1213 to the Attorney General to be used to pay the cost of background checks performed by BCII and the FBI and to cover administrative costs associated with issuing the license.

Waiver of fee

Continuing law requires a sheriff to waive the payment of the license fee in connection with an initial or renewal application for a concealed carry license that is submitted by an applicant who is a retired peace officer, a retired person described in R.C. 109.77(B)(1)(b), or a retired federal law enforcement officer who, prior to retirement, was authorized under federal law to carry a firearm in the course of duty, unless the retired peace officer, person, or federal law enforcement officer retired as a result of a mental disability.  Under prior law, this waiver did not apply to an applicant for an emergency license to carry a concealed handgun.  The act requires the sheriff to waive the fee for persons seeking an application for an emergency license to carry a concealed handgun for any person for whom the sheriff under continuing law must waive the fee for an initial or renewed license.

Firearms pamphlet

(R.C. 109.731(B)(2) and 2923.125(A), (F)(1)(a), (F)(3), (G)(1), and (I))

Continuing law requires the OPOTC, in consultation with the Attorney General, to prepare a pamphlet that explains Ohio firearms laws, instructs the reader in dispute resolution and explains related Ohio laws, and provides information regarding all aspects of the use of deadly force with a firearm.  Under prior law, the OPOTC had to make copies of the pamphlet available to both firearms training programs to give to trainees and to sheriffs for distribution to applicants for licenses or renewals of licenses.  The act eliminates the distribution requirements and instead requires the Attorney General to publish the pamphlet on the Attorney General's web site and to provide the address of the web site to any person who requests the pamphlet and requires training programs and sheriffs to provide the web site address to trainees and applicants.

Renewal applications

(R.C. 109.731(A)(1), 2923.125(F)(3), and 2923.1210)

Prior law established a single statutory form to be used for an application for an initial license and for a renewal of a license to carry a concealed handgun.  It required the OPOTC to prescribe and make the application form available to sheriffs.  The act retains the existing form for an application for an initial license, but it modifies the form to reflect the fact that under the act the applicant is not given a physical firearms pamphlet.  The act creates a new form to be used for an application to renew a license and requires the OPOTC to prescribe and make the form available to sheriffs.  The new form is substantially similar to the form that previously was used for both initial licenses and renewals except as noted in the following paragraph and must conform substantially to the statutory form.

Continuing law requires the sheriff receiving an application for an initial license or renewal of a license to conduct a criminal records check and an incompetency records check.  Under the act, an application for renewal of a license may require the applicant to list on the application form only information and matters occurring since the date of the licensee's last application for an initial or renewal of a license.  The act provides that a sheriff conducting the criminal records check and the incompetency records check may conduct the checks only from the date of the licensee's last application for a license through the date of the application for renewal.

Continuing law requires that an applicant for renewal of a license to carry a concealed handgun that has not previously been renewed must submit proof that the applicant at one time had a competency certification of a type described in R.C. 2923.125(B)(3).  Under continuing law, a valid license or any other previously issued license that had not been revoked was prima-facie evidence that the applicant at one time had an appropriate competency certification.  The act continues this provision and also specifies that an expired license constitutes such prima-facie evidence.

Definition of "unloaded" as used in offense of improperly handling firearms in a motor vehicle

(R.C. 2923.16)

Continuing law prohibits a person from knowingly transporting or having a firearm in a motor vehicle unless the person may lawfully possess that firearm under Ohio or federal law, the firearm is unloaded, and the firearm is carried in one of several specified ways.  "Unloaded" means either (1) that no ammunition is in the firearm in question, and no ammunition is loaded into a magazine or speed loader that may be used with the firearm in question and that is located anywhere within the vehicle in question, without regard to where ammunition otherwise is located within the vehicle in question or (2) with respect to a firearm employing a percussion cap, flintlock, or other obsolete ignition system, that the weapon is uncapped or the priming charge is removed from the pan.  The act specifies that for purposes of the first definition of "unloaded," ammunition held in stripper-clips or in en-bloc clips is not considered ammunition that is loaded into a magazine or speed loader.

 

·         Would have required the Auditor of State to certify to the Director of Budget and Management the amounts of unpaid audit costs for state agencies and local public offices that have ceased operation and the amounts necessary to conduct an appropriate audit program and would have required the Director to transfer the certified amounts from the General Revenue Fund to designated audit expense funds (VETOED).

 

 

General Revenue Fund transfers for certain unpaid audit costs (VETOED)

(R.C. 117.13; Section 225.20)

Continuing law requires the Auditor of State to conduct annual or biennial audits of state agencies and local public offices and establishes procedures for the Auditor to recover costs of these audits.  The act would have added a new procedure for recovering audit costs in certain circumstances.

The act would have required the Auditor to certify to the Director of Budget and Management the amounts due or necessary for state agency audit costs and the Director would have been required to transfer the certified amounts from the General Revenue Fund (GRF) to the existing Public Audit Expense Fund-Intrastate if either of the following had applied:

(1)  A state agency that ceased operation had not paid audit costs pursuant to law.

(2)  In the judgment of the Auditor, the money appropriated for the cost of biennial audits of state agencies was not sufficient to conduct an appropriate audit program.

If a local public office ceased operation and had not paid audit costs pursuant to law, the act would have required one of the following to occur:

(1)  In the case of costs due for an audit performed by the Auditor, the Auditor would have been required to certify to the Director the amounts due for these costs and the Director would have been required to transfer the certified amounts from the GRF to the Public Audit Expense Fund-Local Government.

(2)  In the case of costs due for an audit performed by an independent auditor, the independent auditor would have been required to notify the Auditor of the amounts due for these costs, and the Auditor would have been required to certify the amounts to the Director who then would transfer the certified amounts from the GRF to a new fund that would have been created by the act, the Public Audit Expense Fund-Independent Auditors.

Public Audit Expense Fund-Independent Auditors

The act would have created the Public Audit Expense Fund-Independent Auditors in the state treasury for the purpose of reimbursing independent auditors for unpaid audit costs for audits of local public offices that have ceased operation.

Appropriation of GRF transfers[54]

The act would have appropriated the moneys transferred from the GRF pursuant to this section relative to the costs of audits of state agencies and local public offices.

 

·         Requires the Barber Board to ask each person renewing a license to practice as a barber whether the person wishes to make a $2 voluntary contribution to the Ed Jeffers Barber Museum in addition to the fee otherwise charged and collected.

·         Requires the Board to transmit any contributions to the Treasurer of State for deposit into the Occupational Licensing Fund.

·         Requires the Director of Budget and Management and the Executive Director of the Barber Board to develop a plan to distribute the amounts collected to the Ed Jeffers Barber Museum.

 

 

Optional charge during barber license renewal to fund barber museum

(R.C. 4709.12; Section 227.10)

Under continuing law the Barber Board must charge and collect a statutorily prescribed fee ($110) for the biennial renewal of a license to practice as a barber.  The Board, subject to the approval of the Controlling Board, can increase the fee, provided that the increase does not exceed the statutorily prescribed amount by more than 50%.

The act requires the Board to ask each person renewing a license to practice as a barber whether the person wishes to make a $2 voluntary contribution to the Ed Jeffers Barber Museum in addition to the fee otherwise charged and collected.  The Board must transmit any contributions to the Treasurer of State for deposit into the Occupational Licensing Fund.  On October 1, 2009, or as soon as possible thereafter, the Director of Budget and Management and the Executive Director of the Barber Board must develop a plan to distribute the amounts collected to the Ed Jeffers Barber Museum.

 

·         Permits the Director of Budget and Management to issue guidelines to agencies applying for federal money made available to the state for fiscal stabilization and recovery purposes.

·         Provides that federal money received by the state for fiscal stabilization in support of elementary, secondary, and higher education, public safety, and any other government service is to be deposited into the state treasury to the credit of the General Revenue Fund and is not to be used as a match for the state's share of Medicaid.

·         Would have prohibited the state from entering into or obtaining a certificate of participation or any similar debt instrument without the express approval of the General Assembly (VETOED).

·         Would have required the Director each calendar quarter to prepare a list of all employees paid by warrant of the Director who work primarily for one state agency while being paid from appropriations made to another state agency (VETOED).

·         Directs a state agency with a segregated custodial fund to provide an annual report related to the fund to the Director, in the form and containing the information the Director requires.

·         Authorizes the Director to appoint, and to fix the compensation of, Office of Budget and Management (OBM) employees whose primary duties include the consolidation of statewide financing functions and common transactional processes.

·         Requires the Office of Internal Auditing in OBM to monitor, measure, and report on the effectiveness of federal stimulus funds allocated to Ohio under the federal American Recovery and Reinvestment Act of 2009 (ARRA) to certain members of the General Assembly.

·         Requires OBM, with respect to the quarterly reports required to be made to the federal government under the ARRA regarding the effectiveness of allocated funds, to send those same reports to certain members of the General Assembly.

Federal money made available to the state for fiscal stabilization and recovery purposes

(Section 521.70)

To ensure the level of accountability and transparency required by federal law, the act permits the Director of Budget and Management to issue guidelines to any agency applying for federal money made available to the state for fiscal stabilization and recovery purposes and to prescribe the process by which agencies are to comply with any reporting requirements established by the federal government.

The act requires that federal money received by or on behalf of the state for fiscal stabilization in support of elementary, secondary, and higher education, public safety, and any other government service be deposited into the state treasury to the credit of the General Revenue Fund (GRF).  This federal money cannot be used as a match for the state's share of Medicaid.

The act specifies that federal money received by or on behalf of the state for fiscal stabilization and recovery purposes in FYs 2010 and 2011 is not to be used to compute debt service for purposes of Article VIII, Section 17 of the Ohio Constitution.  Article VIII, Section 17 of the Ohio Constitution imposes a "5% cap" that limits the amount of new debt the state can take on in a fiscal year:  state bonds or other obligations cannot be issued if the total amount of debt service payments that must be made in any future fiscal year from the GRF and net state lottery proceeds would exceed 5% of the total estimated GRF and net state lottery proceeds revenue during the fiscal year of issuance.

Legislative approval of certificates of participation (VETOED)

(R.C. 126.10)

The Governor vetoed a provision that would have prohibited the state from entering into or obtaining a certificate of participation[55] or any similar debt instrument without the express approval of the General Assembly.

Preparation of list of state employees who work primarily for one state agency while being paid with funds appropriated to another (VETOED)

(Section 701.80)

The Governor vetoed a section of law that would have required the Director of Budget and Management to prepare, beginning on October 1, 2009, and on the first day of each calendar quarter thereafter, a list of all employees paid by warrant of the Director who work primarily for one state agency while being paid from appropriations made to another state agency.  The Director would have been required to provide a copy of the list to the President and Minority Leader of the Senate and the Speaker and Minority Leader of the House.

Reporting related to segregated custodial funds

(R.C. 131.38)

The act requires a state agency that possesses, controls, maintains, or holds a segregated custodial fund or otherwise evidences ownership of the contents of a segregated custodial fund to provide to the Director of Budget and Management a report related to the fund by the first day of May of each fiscal year.  This report must be in the form and contain the information the Director requires.

The act defines a "segregated custodial fund" as a fund of a state agency that is established by law that consists of moneys, claims, bonds, notes, other obligations, stocks, and other securities, receipts or other evidences of ownership, and other intangible assets that is neither required to be kept in the custody of the treasurer of state nor required to be part of the state treasury.  Under continuing law, a "state agency" is every organized body, office, or agency established by the laws of Ohio for the exercise of any function of state government.

Employment status of OBM employees whose primary duties include the consolidation of statewide financing functions and common transactional processes

(R.C. 126.21)

The act authorizes the Director of Budget and Management, in consultation with the Director of Administrative Services, to appoint, and to fix the compensation of, Office of Budget and Management employees whose primary duties include the consolidation of statewide financing functions and common transactional processes.  The positions of these employees are thus excluded from inclusion in the State Job Classification Plan that the Director of Administrative Services establishes for employees whose salaries are paid in whole or in part by the state.

Reports monitoring the effectiveness of federal stimulus funds

(Section 521.80)

Under continuing law, the Office of Internal Auditing in the Office of Budget and Management (OBM) is required to conduct internal audits of certain state agencies generally with the intent of improving their operations regarding risk management, internal controls, and governance.  Continuing law also requires the Office to issue preliminary and final reports of individual audit findings and recommendations.  The Office also must annually submit a report to the Governor, President of the Senate, Speaker of the House, and the Auditor of State.  State agencies subject to internal audit are OBM, the Departments of Commerce, Administrative Services, Transportation, Agriculture, Natural Resources, Health, Job and Family Services, Public Safety, Mental Health, Developmental Disabilities, Insurance, Development, Youth Services, Rehabilitation and Correction, Aging, Alcohol and Drug Addiction, Veteran Services, Taxation, the Environmental Protection Agency, and the Bureau of Workers' Compensation.

Semi-annual reports

The act requires the Office, in addition to its duties under continuing law, to (1) monitor and measure the effectiveness of federal stimulus funds allocated to Ohio under the American Recovery and Reinvestment Act of 2009 (ARRA) and (2) review how funds allocated to each state agency subject to internal audit under continuing law are spent.  In addition to all the reports it must issue under continuing law, the Office must submit a report of its findings regarding the effectiveness and expenditure of the federal stimulus funds to the President, Senate Minority Leader, Speaker, House Minority Leader, and the Chairs of the House and Senate committees that handle finance and appropriations.  The reports are to be issued according to the following schedule and time frames: February 1, 2010 (for July 1, 2009-December 31, 2009); August 1, 2010 (January 1, 2010-June 30, 2010); February 1, 2011 (July 1, 2010-December 31, 2010); and August 1, 2011 (January 1, 2011-June 30, 2011).

Quarterly reports

The act also requires that, if OBM is required to submit quarterly reports to the federal government regarding the effectiveness of federal stimulus funds allocated under the ARRA for which Ohio is the prime recipient and the reporting requirement has not been delegated to a sub-recipient, then it must submit those reports to the same General Assembly members described above, as well as the ranking members of the House and Senate committees that handle finance and appropriations.  The act requires OBM to continue to submit the quarterly reports to the legislature for as long as the reports are required by the federal government.

 

·         Would have placed the Capitol Square Review and Advisory Board in the legislative branch of state government (VETOED).

·         Would have placed Board employees in the unclassified civil service and would have specified that they are legislative employees for purposes of the Public Employee Collective Bargaining Act and the law that exempts legislators and legislative employees from paying the Columbus city income tax (VETOED).

·         Would have exempted the Board from the jurisdiction of the Office of Information Technology (VETOED).

 

 

Placement of the Capitol Square Review and Advisory Board in the legislative branch of state government (VETOED)

(R.C. 105.41 and 4117.01(C)(18); Section 803.60)

Continuing law creates the Capitol Square Review and Advisory Board and gives the Board the sole authority to coordinate and approve any improvements, additions, and renovations that are made to Capitol Square including, but not limited to, the placement of monuments and sculpture on the Capitol grounds.  The Board consists of the Senate Clerk, the House Clerk, five members appointed by the Governor, two Senate members appointed by the Senate President, and two House members appointed by the House Speaker.  In addition, the current House Speaker is authorized to appoint to the Board a former House Speaker, and the current Senate President is authorized to appoint to the Board a former Senate President.

The Governor vetoed a provision that would have placed the Board in the legislative branch of state government.  The Governor also vetoed a provision that would have placed Board employees in the unclassified civil service and specified that they are legislative employees for purposes of the Public Employee Collective Bargaining Act and the law that exempts General Assembly members and legislative employees from paying the Columbus city income tax.  Finally, the Governor vetoed a provision that would have specified that these provisions do not abrogate any collective bargaining agreement, for the duration of the agreement, that applies to Board employees and that was entered into under the Public Employee Collective Bargaining Act before the effective date of the provisions.

Exemption of the Board from jurisdiction of the Office of Information Technology (VETOED)

(R.C. 105.41)

Continuing law establishes the Office of Information Technology within the Department of Administrative Services and places it under the supervision of the State Chief Information Officer, who is appointed by the Director of Administrative Services.  The Office's duties include (1) coordinating and superintending statewide efforts to promote common use and development of technology by state agencies and (2) establishing policies and standards for the acquisition and use of information technology by state agencies, with which state agencies must comply.  Continuing law exempts the following from the Office's jurisdiction:

·         The General Assembly and legislative agencies.

·         The courts and judicial agencies.

·         The offices of the Auditor of State, Secretary of State, Treasurer of State, and Attorney General.

·         State-supported institutions of higher education.

·         The five state retirement systems.

·         The Adjutant General's department.

·         The Bureau of Workers' Compensation and the Industrial Commission.  (R.C. 125.18(A), (B), and (G), not in the act.)

The Governor vetoed a provision that also would have exempted the Capitol Square Review and Advisory Board from the Office's jurisdiction.

 

·         Requires that a license to practice chiropractic be renewed biennially rather than annually.

·         Requires the State Chiropractic Board to adopt rules establishing the amount of (1) the license renewal fee and (2) the penalty for failure to renew, in place of the statutory renewal fee of $250 and penalty of $150.

 

 

Renewal of licenses to practice chiropractic

(R.C. 4734.25)

Under prior law, a license to practice chiropractic had to be renewed annually by the first day of January.  The fee for renewal of a license was $250.  A $150 penalty was charged for reinstating a license that was forfeited for failure to renew.

In place of the annual license renewal system, the act provides that a license to practice chiropractic is to be renewed biennially according to a schedule established in rules to be adopted by the State Chiropractic Board.  The act provides that the fee for renewal and penalty for failure to renew is to be an amount specified in rules to be adopted by the Board.

 

·         Defines "aggrieved person" for the purpose of who may participate in certain civil rights proceedings to enforce the Ohio Fair Housing Law.

·         Extends to any party (not just respondents) a right to have the Ohio Civil Rights Commission issue subpoenas in administrative hearings concerning violations of the Ohio Fair Housing Law.

·         Limits the right of a respondent to request a subpoena to when the respondent is a party to an administrative hearing concerning a violation of the Ohio Fair Housing Law.

·         Modifies who may appear at an administrative hearing from a "person" who has or claims an interest to an "aggrieved person" who has or claims an interest; expands the reasons for that person to appear and limits the appearance to the stated existing reasons and new reasons.

·         Requires the Civil Rights Commission to adopt rules governing the appearance of aggrieved persons at an administrative hearing.

·         Authorizes an aggrieved person to intervene as a matter of right in a civil action the Attorney General initiates and maintains.

 

 

Civil Rights Law

(R.C. 4112.01, 4112.04, 4112.05, and 4112.051)

The Ohio Fair Housing Law

The Ohio Civil Rights Law includes as an "unlawful discriminatory practice" the following practices that collectively are known as the Ohio Fair Housing Law:

(1)  Certain practices that interfere with a person's ability to obtain housing because of race, color, religion, sex, military status, familial status, ancestry, disability, or national origin;

(2)  The refusal to consider without prejudice the combined income of both husband and wife for the purpose of extending mortgage credit;

(3)  Using or honoring prohibited discriminatory restrictive covenants;

(4)  Coercing, intimidating, threatening, or interfering with the exercise or enjoyment of any right the Ohio Fair Housing Law grants or protects;

(5)  Discriminating in the selling, brokering, or appraising of real property because of race, color, religion, sex, military status, familial status, ancestry, disability, or national origin.  (R.C. 4112.02(H), not in the act.)

Enforcement of the Ohio Fair Housing Law

An action to enforce the Ohio Fair Housing Law may be initiated by either:  (1) filing a complaint with the Ohio Civil Rights Commission (OCRC) or (2) filing a complaint as a private civil action with a court of common pleas.  The case may be heard in one of three ways:  (1) an administrative hearing the OCRC conducts following a filing with the commission, (2) a civil action the Attorney General initiates and maintains in a court of common pleas following a filing with the OCRC, or (3) a private civil action in a court of common pleas following a filing made directly with that court.

Administrative hearing; election of civil action under Attorney General

When a charge of an unlawful discriminatory practice is filed with the OCRC, the OCRC conducts a preliminary investigation and, if discrimination is found, tries informal methods of eliminating the unlawful practice.  If those methods fail, the OCRC issues a complaint and holds an administrative hearing unless the complainant, an aggrieved person on whose behalf the complaint is issued, or the respondent elects to have the Attorney General initiate and maintain a civil action in a court instead of proceeding with the administrative hearing.  An administrative hearing is held pursuant to procedures under R.C. Chapter 119., the Administrative Procedure Act.  A civil action would proceed pursuant to the Ohio Rules of Civil Procedure.

Private civil action

Aggrieved persons may enforce the Ohio Fair Housing Law by filing a civil action in the court of common pleas of the county in which the discriminatory practice occurred.  The court may appoint an attorney for the person and authorize the commencement of the action without the payment of costs.  The civil action would proceed pursuant to the Ohio Rules of Civil Procedure.

Operation of the act

(R.C. 4112.01, 4112.04, 4112.05, and 4112.051)

Definition of "aggrieved person"

The Ohio Fair Housing Law provides actions that "aggrieved persons" may take to enforce the law.  Prior law did not define "aggrieved person."  Under the act, "aggrieved person" includes both of the following:

(1)  Any person who claims to have been injured by any unlawful discriminatory practice as described in the Ohio Fair Housing Law;

(2)  Any person who believes that the person will be injured by any unlawful discriminatory practice described in the Ohio Fair Housing Law that is about to occur."[56]

Authority to request subpoenas

Continuing law gives the OCRC and "any member of the commission authority to issue subpoenas to compel access to or the production of premises, records, documents, and other evidence or possible sources of evidence or the appearance of individuals."  Under prior law, the respondent also had authority to require, upon written application, the OCRC to issue a subpoena in the Commission's name to the same extent and subject to the same limitations as subpoenas the Commission issued under its subpoena power.

By deleting "respondent" and substituting "party," the act extends to any party to the administrative hearing the authority to request a subpoena that prior law afforded only to respondents.  The act also limits the situations under which a party may request a subpoena to when the hearing is held "under division (B) of section 4112.05," which is an administrative hearing.  This limitation effectively precludes a respondent from requesting a subpoena during investigations, which was possible under prior law, and delays the time at which the respondent may request a subpoena until the respondent is a party in an administrative hearing.

Participation in administrative hearing

Under prior law, any "person who has or claims an interest in the subject of the hearing and in obtaining or preventing relief against the unlawful discriminatory practice may be permitted, in the discretion of the person or persons conducting the hearing, to appear for the presentation of oral or written arguments."  The act modifies this provision by (1) limiting it to an "aggrieved" person, (2) making the person's appearance a right ("shall be permitted") instead of at the discretion of those conducting the hearing, and (3) allowing an appearance only for the purpose of presenting oral or written arguments (permitted under continuing law) and the following reasons which the act adds:  "to present evidence, perform direct and cross-examination, and be represented by counsel."  The act directs the Commission to adopt rules under the Administrative Procedure Act to administer this authority to appear.

Right to intervene in civil action the Attorney General maintains

Under continuing law, when a complaint is filed with the OCRC and the OCRC subsequently issues a complaint for an unlawful discriminatory housing practice, the complainant, any aggrieved person on whose behalf the complaint is issued, or the respondent may elect to have the complaint in a civil action that the Attorney General initiates and maintains.

Under prior law, there was no specific provision that enabled a party to intervene in an action as a matter of right.  Under the act, any aggrieved person may intervene as a matter of right in a civil action the Attorney General maintains, with respect to the issues to be determined in that civil action.

 

·         Eliminates the requirement that the Director of Commerce retain in the Unclaimed Funds Trust Fund 5% of the total amount of unclaimed funds as a fee for administering the funds.

·         Provides that certain savings and loan associations and savings banks are eligible to become public depositories and removes this eligibility from banks that are authorized to do business by another country.

·         Would have provided that, in the Superintendent of Financial Institutions' absence, a deputy superintendent, or in the absence of both the Superintendent and an available deputy superintendent, the Director of Commerce, may perform certain examination and regulatory functions of the Superintendent for a limited period of time if written authorization is given by the Superintendent (VETOED).

·         As a result of the Governor's veto, provides that, in the Superintendent of Financial Institutions' absence, the Director of Commerce may perform certain examination and regulatory functions of the Superintendent for a limited period of time.

·         Provides for the implementation of the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ("S.A.F.E. Act") by requiring the licensing of "loan originators" who are employed by or associated with either a mortgage broker registered under the Mortgage Brokers Law (R.C. 1322.01 to 1322.12) or a mortgage lender registered under the Mortgage Loan Law (R.C. 1321.51 to 1321.60); eliminates the licensing of "loan officers" under the Mortgage Brokers Law.

·         Provides that compliance with the S.A.F.E. Act by credit unions insured by a credit union share guaranty corporation, and the credit unions' subsidiaries and loan originators, be determined by the Superintendent of Financial Institutions by rule.

·         Makes numerous revisions to the Mortgage Loan Law with respect to the regulation of mortgage lenders.

·         Makes numerous revisions to the Mortgage Brokers Law with respect to the regulation of mortgage brokers.

·         Adds to the Video Service Authorization Act's funding sources authority for the Director of Commerce to impose an annual, proportional assessment on video service providers, to be used by the Department of Commerce to carry out the Law.

·         Increases certain license, annual renewal, and filing fees for securities dealers, securities salespersons, and investment advisers.

·         Creates the Division of Securities Investor Education and Enforcement Expense Fund to pay expenses of the Division relating to education or enforcement for the protection of securities investors and the public.

·         In the case of a transfer of a securities dealer's license and the licenses of its salespersons to a successor entity, increases to $15 the fee charged by the Division of Securities for every salesperson's license that is transferred.

·         In the case of a transfer of an investment adviser's license and the licenses of its investment adviser representatives to a successor entity, increases to $15 the fee charged by the Division of Securities for every investment adviser representative's license that is transferred.

·         Allows the Director of Budget and Management upon determining at any time that the money in the State Fire Marshal's Fund exceeds the amount necessary to defray ongoing operating expenses in a fiscal year, to transfer the excess to the General Revenue Fund.

·         Provides that the Director of Commerce may use money in the State Fire Marshal's Fund not used for operating expenses for certain real property and facilities expenses with the approval of the Director of Budget and Management.

·         Combines the Division of Labor and Worker Safety and the Division of Industrial Compliance in the Department of Commerce into the Division of Labor in the Department of Commerce, to be led by the Superintendent of Labor.

·         Transfers the duties of the Superintendent and Division of Labor and Worker Safety and the Superintendent and Division of Industrial Compliance to the Superintendent of Labor and the Division of Labor, as applicable.

·         Renames the Industrial Compliance Operating Fund the Labor Operating Fund.

·         Creates the position of Chief of Worker Protection in the Division of Labor and places that position in the unclassified civil service.

·         Increases boiler inspection and certificate of operation fees and the fee to receive a permit to make any installation or major repair or modification to any boiler.

·         Increases the examination fee to receive a certificate of competency for boiler inspections and the application and license fees for related occupational licenses.

·         Requires a fee to be paid for the inspection or attempted inspection by a general inspector before the operation of an elevator after an adjudication under the Elevator Law.

·         Increases the fee for inspections or attempted inspections of elevators by a general inspector and the fee for issuing or renewing a certificate of operation for an elevator that is inspected every six months.

·         Changes the amount of the additional fee the Superintendent of Industrial Compliance (changed to Superintendent of Labor) may assess for the reinspection of an elevator under specified conditions.

·         Increases various real estate licensing fees and makes various real estate licensing fees nonrefundable.

·         Reduces the amount of real estate licensing fees that must be contributed to the Real Estate Education and Research Fund.

·         Requires a verified application for payment out of the Real Estate Recovery Fund to be filed only in the Court of Common Pleas of Franklin County, instead of any court of common pleas.

·         Modifies the Real Estate Appraisers Law as follows:

--Expands the definition of "appraisal report" and "report" to include "appraisal review" and "appraisal consulting services."

--Characterizes proceedings related to violations of the Law as disciplinary actions instead of revocation and suspension actions, and modifies procedures for disciplinary actions.

--Eliminates the requirement that applicants for an appraiser license, certification, or registration submit a fingerprint; increases fees for initial license, registrations, and certificates; and requires appraiser assistants to meet initial education requirements only for the third and subsequent years in that status.

--Creates a medical exception to the requirement that a real estate appraiser who has allowed the appraiser's certificate, license, or registration to expire and has not renewed it, or who has failed to meet continuing education requirements, during the three-month grace period must reapply and retake the examination.

--Prohibits an individual from engaging in any activities permitted by a real estate appraisal certificate, registration, or license during the grace period for renewal of an expired certificate, license, or registration or during the time period for which a medical exception applies until all renewal fees and the late filing fee have been paid and all continuing education requirements have been met.

--Enables an informal mediation meeting to deal with complaints against real estate appraisers before a hearing is held and, if a formal hearing is held, permits the appraiser to provide written objections to the hearing examiner's report.

--Expands the list of suggested disciplinary actions the Real Estate Appraiser Board may take and expands the types of violations that require disciplinary actions.

 

 

Unclaimed Funds Trust Fund costs and fees of administration

(R.C. 169.08)

Unclaimed funds are generally defined under continuing law as moneys, rights to moneys, or intangible property enumerated in the Unclaimed Funds Act (Chapter 169. of the Revised Code) with respect to which the owner has not taken specified actions or otherwise indicated any interest.  Continuing law requires holders of unclaimed funds to report the amounts to the Director of Commerce and for the transfer of all or some of such funds to the Director for deposit with a financial organization or in the Unclaimed Funds Trust Fund in the state treasury.  Claims made to recover unclaimed funds are paid from the Trust Fund.  Former law also required the Director to retain in the Trust Fund 5% of the total amount of unclaimed funds payable to a claimant as a fee for administering the funds.  The act eliminated this requirement.

Public Depository Law

(R.C. 135.03, 135.06, 135.08, and 135.32)

The act revises Ohio's Public Depository Law to extend public depository eligibility to savings banks and savings and loan associations that are located in Ohio and doing business under authority granted by another state and withdraws eligibility from any bank doing business under authority granted by the regulatory authority of another country.

Independence of the Superintendent and Division of Financial Institutions (PARTIALLY VETOED)

(R.C. 121.07(A))

Continuing law states that the Superintendent of Financial Institutions and the Division of Financial Institutions are independent of and not subject to the control of the Department or the Director of Commerce when performing any of the examination or regulatory functions vested in the Superintendent by Title XI (Financial Institutions), Chapter 1733. (Credit Unions), Chapter 1761. (Credit Union Guaranty Corporations), and sections 1315.01 to 1315.18 (Money Transmitters Law) of the Revised Code.

The Governor vetoed a provision providing that, in the absence of the Superintendent, a deputy superintendent, or in the absence of both the Superintendent and an available deputy superintendent, the Director of Commerce may, for a limited period of time, perform or exercise any of the examination or regulatory functions if written authorization is given by the Superintendent.  Pursuant to the Governor's veto, the act now provides that in the Superintendent's absence, the Director of Commerce may, for a limited period of time, perform those regulatory functions with no requirement for the Superintendent's written authorization.

Implementation of the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ("S.A.F.E. Act")

Background

The S.A.F.E. Act, Title V of the federal Housing and Economic Recovery Act of 2008, was signed into law by the President on July 30, 2008.  The S.A.F.E. Act requires that residential mortgage loan originators be either state-licensed by August 1, 2009, or--for employees of depository institutions and their subsidiaries--federally registered.  Both state licensed and federally registered loan originators must register with, and obtain a unique identifier from, the Nationwide Mortgage Licensing System and Registry--a mortgage licensing system to be developed and maintained by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators for the licensing and registration of loan originators.

If, by August 1, 2009 (or August 1, 2010, for any state whose legislature meets biennially), a state does not have in place a system for licensing and registering loan originators that meets the requirements of the S.A.F.E. Act, the U.S. Department of Housing and Urban Development (HUD) is to establish a backup licensing system to coordinate licensing and registration for loan originators in that state.  However, HUD may grant an extension of up to 24 months to any state making a good faith effort to meet the minimum standards.

According to the National Conference of State Legislatures, the following is what states must due to maintain loan originator supervisory authority:

·         Provide effective supervision and enforcement of such law, including suspension, termination or nonrenewal of a license for a violation of State or Federal Law.

·         Ensure all State-licensed loan originators operating in the State are registered with the Nationwide Mortgage Licensing System and Registry.

·         Regularly report violations of such law, as well as enforcement actions and other relevant information to the Nationwide Mortgage Licensing System and Registry.

·         Have due process in place for challenging information contained in the Nationwide Mortgage Licensing System and Registry.

·         Establish a mechanism to assess civil money penalties for individuals acting as mortgage originators in their State without a valid license or registration.

·         Establish minimum net worth or surety bonding requirements that reflect the dollar amount of loans originated by a residential mortgage loan originator, or establish a recovery fund paid into by the loan originators.

To be licensed within a State, loan originators must not have any felonies over the past seven years, never had a felony involving fraud or dishonesty, never had a loan originator license revoked, must demonstrate financial responsibility and general fitness, score 75% or better on a national test created by the Nationwide Mortgage Licensing System and Registry and take eight hours of continuing education annually.[57] 

Overview of the act

(R.C. 1321.51, 1321.52 (E) and (F)(1), 1321.521, 1322.01, 1322.02(B) and (C)(1), and 1322.024)

Prior law prohibited any person from acting as a loan officer without first having obtained a license from the Superintendent of Financial Institutions under the Mortgage Brokers Law (R.C. 1322.01 to 1322.12).  For purposes of that law, "loan officer" was defined as an employee who originates mortgage loans in consideration of direct or indirect gain, profit, fees, or charges.  The term included an employee who solicits financial and mortgage information from the public for sale to another mortgage broker.  A loan officer was prohibited from being employed by more than one mortgage broker at any one time.[58]

The act eliminates the licensing of loan officers, and instead requires the licensing of loan originators who are employed by or associated with:

(1)  A mortgage broker registered under the Mortgage Brokers Law (R.C. 1322.01 to 1322.12), or an entity exempt from registration under that law; or

(2)  A mortgage lender registered under the Mortgage Loan Law (R.C. 1321.51 to 1321.60), or an entity exempt from registration under that law.

A loan originator cannot be employed by or associated with more than one registrant or exempt entity at any one time.

For purposes of the Mortgage Loan Law, the defined term is "mortgage loan originator" (see R.C. 1321.51(P)).  Under the Mortgage Brokers Law, however, the defined term is "loan originator" (see R.C. 1322.01(E)). Because the two terms have substantially the same meaning, this analysis will simply refer to "loan originator."

"Loan originator" is defined as an individual who for compensation or gain, or in anticipation of compensation or gain, does any of the following:

(1)  Takes or offers to take a "residential mortgage loan"[59] application;

(2)  Assists or offers to assist a borrower/buyer in obtaining or applying to obtain a residential mortgage loan by, among other things, advising on loan terms, including rates, fees, and other costs;

(3)  Offers or negotiates terms of a residential mortgage loan;

(4)  Issues or offers to issue a commitment for a residential mortgage loan to a borrower/buyer.

"Loan originator" does not include any of the following:

(1)  An individual who performs purely "administrative or clerical tasks"[60] on behalf of a loan originator;

(2)  A person licensed under the Real Estate Brokers Law (R.C. Chapter 4735.), or under the similar law of another state, who performs only "real estate brokerage activities"[61] permitted by that license, provided the person is not compensated by a mortgage lender, mortgage broker, loan originator, or by any agent thereof;

(3)  A person solely involved in extensions of credit relating to timeshare plans, as that term is defined in 11 U.S.C. 101 in effect on January 1, 2009;

(4)  A person acting solely as a "loan processor or underwriter"[62] and who does not represent to the public, through advertising or other means of communicating, including the use of business cards, stationery, brochures, signs, rate lists, or other promotional items, that the person can or will perform any of the activities of a loan originator;

(5)  A licensed attorney who negotiates the terms of a residential mortgage loan on behalf of a client as an ancillary matter to the attorney's representation of the client, unless the attorney is compensated by a lender, a mortgage broker, or another loan originator, or by any agent thereof;

(6)  Any person engaged in the retail sale of manufactured or mobile homes or industrialized units if, in connection with financing those retail sales, the person only assists the borrower by providing or transmitting the loan application and does not do any of the following:

(a)  Offer or negotiate the residential mortgage loan rates or terms;

(b)  Provide any counseling with borrowers about residential mortgage loan rates or terms;

(c)  Receive any payment or fee from any company or individual for assisting the borrower to obtain or apply for financing to purchase the manufactured or mobile home or industrialized unit;

(d)  Assist the borrower in completing a residential mortgage loan application.

For purposes of the Mortgage Loan Law, an individual acting exclusively as a servicer engaging in loss mitigation efforts with respect to existing mortgage transactions is not to be considered a "mortgage loan originator" until July 1, 2011, unless the delay is denied by the U.S. Department of Housing and Urban Development.

For purposes of the Mortgage Brokers Law, "loan originator" does not include any individual employed by a nonprofit organization that is recognized as tax exempt under 26 U.S.C. 501(c)(3) and whose primary activity is the construction, remodeling, or rehabilitation of homes for use by low income families, provided that (1) the nonprofit organization makes no-profit mortgage loans or mortgage loans at 0% interest to low income families and no fees accrue directly to the nonprofit organization or individual employed by the nonprofit organization from those mortgage loans and that (2) the U.S. Department of Housing and Urban Development does not deny this exemption.

The act authorizes the Superintendent to adopt rules to expand the definition of loan originator by adding individuals or to exempt additional individuals or persons from that definition, if the Superintendent finds that the addition or exemption is consistent with the purposes fairly intended by the policy and provisions of the Mortgage Loan Law or Mortgage Brokers Law, as applicable, and the S.A.F.E. Act.  Such rules must be adopted in accordance with R.C. Chapter 119., the Administrative Procedure Act.

Each licensed loan originator ("licensee") must register with, and maintain a valid unique identifier issued by, the Nationwide Mortgage Licensing System and Registry (NMLSR).  A "unique identifier" is a number or other identifier that permanently identifies a loan originator and is assigned by protocols established by the NMLSR or federal banking agencies to facilitate electronic tracking of loan originators and uniform identification of, and public access to, the employment history of, and the publicly adjudicated disciplinary and enforcement actions against, loan originators.

An individual acting under the individual's authority as a registered loan originator is not required to be licensed under the act.  A "registered loan originator" is loan originator who is an employee of a "depository institution," a subsidiary that is owned and controlled by a depository institution and regulated by a "federal banking agency," or an institution regulated by the Farm Credit Administration.[63]  Registered loan originators must be registered with, and maintain a unique identifier through, the NMLSR.

Application for a loan originator license; investigation

(R.C. 109.572, 1321.531, and 1322.031)

An application for a loan originator license must be in writing, under oath, and in the form prescribed by the Superintendent of Financial Institutions.  It must be accompanied by a nonrefundable application fee of $150 and all other required fees, including any fee required by the NMLSR.

In connection with applying for a loan originator license, the applicant is also required to furnish to the NMLSR the following information concerning the applicant's identity:

(1)  The applicant's fingerprints for submission to the FBI, and any other governmental agency or entity authorized to receive such information, for purposes of a state, national, and international criminal history background check;

(2)  Personal history and experience in a form prescribed by the NMLSR, along with authorization for the Superintendent and the NMLSR to obtain an independent credit report from a consumer reporting agency and information related to any administrative, civil, or criminal findings by any governmental jurisdiction.

The act permits the Superintendent to use the Conference of State Bank Supervisors, or a wholly owned subsidiary, as a channeling agent for requesting information from and distributing information to the U.S. Department of Justice or any other governmental agency.  The Superintendent may also use the NMLSR as a channeling agent for requesting information from and distributing information to any source related to matters subject to (1) and (2), above.

Upon the filing of the application and payment of the application fee and any other required fee, the Superintendent must obtain a criminal history records check and request that criminal record information from the FBI be obtained.  To fulfill this requirement, the Superintendent is to either request the Superintendent of the Bureau of Criminal Identification and Investigation, or a vendor approved by the Bureau, to conduct a criminal records check based on the applicant's fingerprints (or, if the fingerprints are unreadable, based on the applicant's social security number), or authorize the NMLSR to request a criminal history background check.  Any fee required by the Bureau or by the NMLSR is to be paid by the applicant.

The Superintendent of Financial Institutions is also required to conduct a civil records check.

If, in order to issue a license to an applicant, additional investigation by the Superintendent outside this state is necessary, the Superintendent may require the applicant to advance sufficient funds to pay the actual expenses of the investigation, if it appears that these expenses will exceed $150.[64]  The Superintendent must provide the applicant with an itemized statement of the actual expenses that the applicant is required to pay.

If an application for a loan originator license does not contain all of the information required under the act, and if that information is not submitted to the Superintendent within 90 days after the Superintendent requests the information in writing, the Superintendent may consider the application withdrawn.

Issuance of license; license renewals

(R.C. 1321.532 and 1322.041)

Upon conclusion of the investigation, the Superintendent of Financial Institutions must issue a loan originator license to the applicant if the Superintendent finds that all of the following conditions are met:

(1)  The application is accompanied by the application fee and any fee required by the NMLSR.  If a check or other draft instrument is returned to the Superintendent for insufficient funds, the Superintendent must notify the applicant by certified mail, return receipt requested, that the application will be withdrawn unless the applicant, within 30 days after receipt of the notice, submits the application fee and a $100 penalty.  If the applicant does not submit the application fee and penalty within that time period, or if any check or other draft instrument used to pay the fee or penalty is returned for insufficient funds, the application is to be withdrawn immediately without a hearing.[65]

If a check or other draft instrument is returned to the Superintendent for insufficient funds after the license has been issued, the Superintendent must notify the licensee by certified mail, return receipt requested, that the license issued in reliance on the check or other draft instrument will be canceled unless the licensee, within 30 days after receipt of the notice, submits the application fee and a $100 penalty.  If the licensee does not submit the application fee and penalty within that time period, or if any check or other draft instrument used to pay the fee or penalty is returned for insufficient funds, the license must be canceled immediately without a hearing, and the licensee must cease activity as a loan originator.

(2)  The applicant complies with the Mortgage Loan Law or Mortgage Brokers Law, as applicable.

(3)  The applicant has not had a loan originator license, or comparable authority, revoked in any governmental jurisdiction.

(4)  The applicant has not been convicted of, or pleaded guilty to, either of the following in a domestic, foreign, or military court:

(a)  During the seven-year period immediately preceding the date of application for licensure, any felony or a misdemeanor involving theft;

(b)  At any time prior to the date of application for licensure, a felony involving an act of fraud, dishonesty, a breach of trust, theft, or money laundering.[66]

(5)  Based on the totality of the circumstances and information submitted in the application, the applicant has proven to the Superintendent of Financial Institutions, by a preponderance of the evidence, that the applicant is of good business repute, appears qualified to act as a loan originator, and has fully complied with the Mortgage Loan Law or Mortgage Brokers Law, as applicable, and that the applicant meets all of the conditions for issuing a loan originator license.

(6)  The applicant successfully completed the written test and the prelicensing instruction set forth in the act (see "Pre-licensing instruction; written test," below).

(7)  The applicant is covered under a valid bond in compliance with the act (see "Bond requirement," below).

(8)  The applicant's financial responsibility, character, and general fitness command the confidence of the public and warrant the belief that the loan originator will operate honestly and fairly in compliance with the purposes of the Mortgage Loan Law or Mortgage Brokers Law, as applicable. The Superintendent is prohibited from using a credit score as the sole basis for a license denial.

A loan originator license may be renewed annually on or before December 31, if the Superintendent finds that all of the following conditions are met:

(1)  The renewal application is accompanied by a nonrefundable renewal fee of $150 and any fee required by the NMLSR.  If a check or other draft instrument is returned to the Superintendent for insufficient funds, the Superintendent is to notify the licensee by certified mail, return receipt requested, that the license renewed in reliance on the check or other draft instrument will be canceled unless the licensee, within 30 days after receipt of the notice, submits the renewal fee and a $100 penalty to the Superintendent.  If the licensee does not submit the renewal fee and penalty within that time period, or if any check or other draft instrument used to pay the fee or penalty is returned for insufficient funds, the license is to be canceled immediately without a hearing, and the licensee must cease activity as a loan originator.

(2)  The applicant has completed at least eight hours of continuing education as required by the act (see "Continuing education requirement," below).

(3)  The applicant meets the conditions described above for original licensure.

(4)  The applicant's license is not subject to an order of suspension or an unpaid and past due fine imposed by the Superintendent.

If a license renewal application or fee is received by the Superintendent after December 31, the license is not to be considered renewed, and the applicant must cease activity as a loan originator.  This does not apply, however, if the applicant submits the renewal application and fee, and a $100 penalty, to the Superintendent not later than January 31.

If a renewal application for a mortgage loan originator license does not contain all of the required information, and if that information is not submitted to the Superintendent within 90 days after the Superintendent requests it in writing, the Superintendent may consider the application withdrawn.

Pre-licensing instruction; written test

(R.C. 1321.534, 1321.535, 1322.031(B) and (C), and 1322.051(B) and (C))

The act requires loan originator applicants to submit evidence acceptable to the Superintendent of Financial Institutions that the applicant has successfully completed at least 20 hours of pre-licensing instruction in a course or program of study reviewed and approved by the NMLSR.  Review and approval of a pre-licensing education course includes review and approval of the course provider.  Loan originators under the Mortgage Brokers Law must also successfully complete four hours of instruction in a course or program of study reviewed and approved by the Superintendent  concerning state lending laws and the Ohio Consumer Sales Practices Act (R.C. Chapter 1345.) as it relates to mortgage brokers and loan originators.

If a person successfully completed the pre-licensing education requirements reviewed and approved by the NMLSR for any state within the previous five years, the person is to be granted credit toward completion of the pre-licensing education requirements of this state.

In the event the NMLSR does not have in place an approval program to ensure that all pre-licensing education courses meet the criteria set forth above, the Superintendent is to require, until that program is in place, evidence that the applicant has successfully completed 20 hours of instruction in a course or program of study approved by the Superintendent that consists of at least all of the following:

(1)  Four hours of instruction concerning state and federal mortgage lending laws;

(2)  Four hours of instruction concerning the Ohio Consumer Sales Practices Act, as it applies to registrants and licensees;

(3)  Four hours of instruction concerning the loan application and closing process;[67]

(4)  Two hours of instruction concerning the underwriting process;

(5)  Two hours of instruction concerning the secondary market for mortgage loans;

(6)  Two hours of instruction covering basic mortgage financing concepts and terms;

(7)  Two hours of instruction concerning the ethical responsibilities of a registrant and a licensee, including with respect to confidentiality, consumer counseling, and the duties and standards of care created by the act.

Each applicant also must submit to a written test that is developed and approved by the NMLSR and administered by a test provider approved by the NMLSR based upon reasonable standards. The test must adequately measure the applicant's knowledge and comprehension in appropriate subject matters, including ethics and federal and state law related to mortgage origination, fraud, consumer protection, the nontraditional mortgage marketplace, and fair lending issues.  In order to pass the test, an individual must achieve a test score of at least 75% correct answers on all questions.  Applicants for a loan originators license under the Mortgage Brokers Law must also achieve a test score of at least 75% correct answers on all questions relating to Ohio mortgage lending laws and the Ohio Consumer Sales Practices Act.

An individual may retake the test three consecutive times provided the period between taking the tests is at least 30 days. After failing three consecutive tests, an individual must wait at least six months before taking the test again. If a loan originator fails to maintain a valid license for a period of five years or longer, the individual must retake the test.  For this purpose, any time during which the individual is a registered loan originator is not to be taken into account.

Until the NMLSR implements a testing process that meets the criteria set forth above, the Superintendent is to require evidence that the applicant passed a written test acceptable to the Superintendent.

Bond requirement

(R.C. 1321.533(A)(2) and (B) to (F) and 1322.05(A)(2) and (B) to (F))

If licensed loan originator is employed by or associated with a person or entity that is exempt from registration under the Mortgage Loan Law or Mortgage Brokers Law, as applicable, the licensee, or the exempt person or entity on the licensee's behalf, must obtain and maintain in effect at all times a corporate surety bond issued by a bonding company or insurance company authorized to do business in Ohio.  All of the following conditions apply to the bond:

(1)  The bond must be in favor of the Superintendent of Financial Institutions.

(2)  The bond must be in the penal sum of one-half per cent of the aggregate loan amount of residential mortgage loans originated in the immediately preceding calendar year, but not exceeding $100,000.  The bond cannot, however, be less than $50,000.

(3)  The term of the bond must coincide with the term of licensure.

(4)  A copy of the bond must be filed with the Superintendent.

(5)  The bond must be for the exclusive benefit of any borrower/buyer injured by a violation by the licensee of any provision of the Mortgage Loan Law or the Mortgage Brokers Law, as applicable, or the rules adopted thereunder.

(6)  The aggregate liability of the corporate surety for any and all breaches of the conditions of the bond cannot exceed the penal sum of the bond.

Licensees covered by a corporate surety bond obtained by a registrant, or by an exempt person or entity, they are employed by or associated with do not have to obtain an individual bond.

Continuing education requirement

(R.C. 1321.536 and 1322.052)

Each licensed loan originator is required to complete at least eight hours of continuing education every calendar year.  To fulfill this requirement, the continuing education must be offered in a course or program of study reviewed and approved by the NMLSR based upon reasonable standards.  The course or program of study must include all of the following:

(1)  Three hours of applicable federal law and regulations;

(2)  Two hours of ethics, which must include instruction on fraud, consumer protection, and fair lending issues;

(3)  Two hours of training related to lending standards for the "nontraditional mortgage product" marketplace.[68]

The following conditions apply to the continuing education required by the act:

(1)  An individual cannot take the same approved course in the same or successive years to meet the annual requirement for continuing education.

(2)  An individual can only receive credit for a continuing education course in the year in which the course is taken, unless the individual is making up a deficiency in continuing education as permitted by a rule or order of the Superintendent of Financial Institutions.

(3)  A licensee who subsequently becomes unlicensed must complete the continuing education requirement for the last year in which the license was held prior to the issuance of a new or renewed license.

(4)  A licensee who is approved as an instructor of an approved continuing education course may receive credit for the licensee's own annual continuing education requirement at the rate of two credit hours for every one hour taught.

(5)  A person having successfully completed a continuing education course approved by the NMLSR for any state is to receive credit toward completion of the continuing education requirement of this state.

Until the NMLSR implements a review and approval process, the Superintendent is to require evidence that the licensee has successfully completed at least eight hours of continuing education in a course or program of study approved by the Superintendent.

Conduct of business

(R.C. 1321.551(B) to (E) and (G) and 1322.031(H) and (J))

The business of a loan originator must principally be transacted at an office of the mortgage lender or mortgage broker ("registrant") with whom the licensee is employed or associated.  Each original loan originator license is to be deposited with and maintained at the registrant's main office.  A copy of the license is to be maintained and displayed at the office where the loan originator principally transacts business.

If a loan originator's employment or association is terminated for any reason, the registrant is required to return the original loan originator license to the Superintendent of Financial Institutions within five business days after the termination.  The licensee may request the transfer of the license to another registrant by submitting a transfer application, along with a $15 fee and any fee required by the NMLSR, to the Superintendent, or may request in writing that the Superintendent hold the license in escrow.  A licensee whose license is held in escrow must cease activity as a loan originator, apply for renewal annually, and comply with the annual continuing education requirement.

Pending the transfer of a loan originator's license to a different registrant, the registrant may employ or be associated with the loan originator on a temporary basis if the registrant receives written confirmation from the Superintendent that the loan originator holds a valid license.

If a loan originator is employed by or associated with a person exempt from registration under the Mortgage Loan Law or Mortgage Brokers Law, the loan originator must maintain and display the original loan originator license at the office where the loan originator principally transacts business.  In the event the loan originator's employment or association is terminated for any reason, the licensee is required to return the original loan originator license to the Superintendent within five business days after the termination.  The licensee may request the transfer of the license to a mortgage broker or another person claiming an exemption from the law by submitting a transfer application, along with a $15 fee and any fee required by the NMLSR, to the Superintendent, or may request the Superintendent in writing to hold the license in escrow.  A licensee whose license is held in escrow must cease activity as a loan originator, apply for renewal annually, and comply with the annual continuing education requirement. The licensee may seek to be employed or associated with a mortgage broker or another person claiming exemption from the law if the mortgage broker or person receives written confirmation from the Superintendent that the loan originator holds a valid license.

A license, or the authority granted under that license, is not assignable and cannot be franchised by contract or any other means.

Duties and standards of care

(R.C. 1321.593 and 1322.081)

Under the act, a licensed loan originator and any person required to be licensed must do the following in connection with the business of making or offering to make residential mortgage loans:

(1)  Safeguard and account for any money handled for the borrower/buyer;

(2)  Follow reasonable and lawful instructions from the borrower/buyer;

(3)  Act with reasonable skill, care, and diligence;

(4)  Act in good faith and with fair dealing in any transaction, practice, or course of business in connection with making/brokering or originating any residential mortgage loan;

(5)  And, with respect to loan originators under the Mortgage Brokers law, make reasonable efforts to secure a residential mortgage loan with rates, charges, and repayment terms that are advantageous to the buyer.

The act provides that these duties and standards of care cannot be waived or modified, and that they do not apply to wholesale lenders.

Under the Mortgage Brokers Law only, a buyer injured by a failure to comply with these duties and standards of care may bring an action for recovery of damages.  Damages awarded cannot be less than all compensation paid directly or indirectly to a mortgage broker from any source, plus reasonable attorney's fees and court costs.  The buyer may be awarded punitive damages. An injured buyer is precluded from recovering any damages if the buyer has already recovered damages in a cause of action initiated under any other provision of the Mortgage Brokers Law and the recovery of damages for a failure to comply with these duties and standards of care is based on the same acts or circumstances as the recovery of damages under the other provision.

Required disclosures

(R.C. 1321.592, 1321.594, 1322.062 to 1322.064, and 1322.09(A))

The act imposes numerous disclosure requirements on licensed loan originators, including the following:

--A licensee must, not earlier than three business days nor later than 24 hours before the loan is closed, deliver to the borrower/buyer a written disclosure that includes (1) a statement indicating whether property taxes will be escrowed and (2) a description of what is covered by the regular monthly payment, including principal, interest, taxes, and insurance, as applicable.

--A licensee under the Mortgage Brokers Law must deliver to the buyer a residential mortgage loan origination disclosure statement and a good faith estimate statement of settlement costs, as ongoing law requires of registrants.

The act also prohibits a licensee from failing to do either of the following:

(1)  Timely inform the buyer of any material change in the terms of the residential mortgage loan.  "Material change" means:  (a) a change in the type of residential mortgage loan being offered, such as a fixed or variable rate loan or a loan with a balloon payment, (b) a change in the term of the loan, as reflected in the number of monthly payments due before a final payment is scheduled to be made, (c) a change in the interest rate of more than 0.15%, (d) a change in the regular total monthly payment, including principal, interest, any required mortgage insurance, and any escrowed taxes or property insurance, of more than 5%, (e) a change regarding whether the escrow of taxes or insurance will be required, or (f) a change regarding whether private mortgage insurance will be required.

(2)  Timely inform the borrower/buyer if any fees payable by the borrower/buyer to the licensee, registrant, or lender increase by more than 10% or $100, whichever is greater.

To be considered "timely," a licensee under the Mortgage Loan Law must provide the borrower with the revised information not later than the time requirement imposed under 12 C.F.R. 226.19(a)(2) and (3),[69] as those provisions of federal law exist on July 31, 2009.  Under the Mortgage Brokers Law, the disclosure is considered "timely" if it is provided to the buyer not later than 24 hours after the change occurs, or 24 hours before the loan is closed, whichever is earlier.

If an increase in the total amount of the fee to be paid by the borrower/buyer is not disclosed in accordance with (2), above, the registrant or licensee must refund the amount by which the fee was increased.  If the fee is financed into the loan, the registrant or licensee must also refund the interest that would accrue over the term of the loan on that excess amount.

Under the Mortgage Brokers Law, any advertisement relating to a loan originator's services must include the name and street address of the loan originator and the number designated on the loan originator's license.

Prohibitions; penalties and damages

(R.C. 1321.52(F)(2), 1321.59, 1321.591, 1321.99, 1322.021(C)(2), 1322.07, 1322.071, and 1322.11)

Licensees under the Mortgage Loan Law are subject to some of the same prohibitions the act prescribes for registrants under that law (see "Regulation of mortgage lenders under the Mortgage Loan Law," "Prohibitions; penalties," below).  Likewise, licensees under the Mortgage Brokers Law are subject to some of the same prohibitions prescribed for registrants under that law (see "Regulation of mortgage brokers under the Mortgage Brokers Law," "Prohibitions; penalties," below).

The act also prohibits any person from using a licensee's unique identifier for any purpose other than as set forth in the S.A.F.E. Act.

Under ongoing law, a buyer injured by a violation of or failure to comply with certain provisions of the Mortgage Loan Law or Mortgage Brokers Law may bring an action for the recovery of damages.

Enforcement; administrative actions; reports to NMLSR

(R.C. 1321.54, 1321.55(B)(3), 1322.06(C), 1322.061(D), and 1322.10)

After notice and an opportunity to be heard, the Division of Financial Institutions may revoke, suspend, or refuse to renew any loan originator license if it finds any of the following:

(1)  A violation of or failure to comply with any provision of the Mortgage Loan Law or Mortgage Brokers Law, as applicable, or the rules adopted thereunder, any federal lending law, or any other law applicable to the business conducted under a license;

(2)  The person has been convicted of or pleaded guilty to a felony offense in a domestic, foreign, or military court;

(3)  The person has been convicted of or pleaded guilty to any criminal offense involving theft, receiving stolen property, embezzlement, forgery, fraud, passing bad checks, money laundering, breach of trust, dishonesty, or drug trafficking, or any criminal offense involving money or securities, in a domestic, foreign, or military court;

(4)  The person's loan originator license, or comparable authority, has been revoked in any governmental jurisdiction.

With respect to mortgage loan originators under the Mortgage Loan Law, the act permits the Division to impose a monetary fine in addition to, or in lieu of, any revocation, suspension, or denial of a license. The Superintendent of Financial Institutions also may impose a fine not exceeding $25,000 for any violation of the Law or any rule adopted thereunder.

Under the Mortgage Brokers Law, the Superintendent may impose a fine of not more than $1,000 for each day a violation of the Law, or any rule adopted thereunder, is committed, repeated, or continued.  If the loan originator engages in a pattern of repeated violations, the Superintendent may impose a fine of not more than $2,000 for each day the violation is committed, repeated, or continued.

In determining the amount of a fine to be imposed, the Superintendent may consider all of the following to the extent it is known to the Division:

(1)  The seriousness of the violation;

(2)  The licensee's good faith efforts to prevent the violation;

(3)  The licensee's history regarding violations and compliance with Division orders;

(4)  The licensee's financial resources;

(5)  Any other matters the Superintendent considers appropriate in enforcing these provisions.

All fines collected are to be paid to the Treasurer of State to the credit of the ongoing Consumer Finance Fund.  The act states that imposition of monetary fines under these provisions does not preclude the imposition of any criminal fine.

If the Superintendent makes application to the court of common pleas for an order enjoining a person from acting as a loan originator without being licensed under the act, the Superintendent may seek civil penalties for that unlicensed conduct in an amount not to exceed $5,000 per violation.  In addition, if the Superintendent takes administrative action to enjoin such unlicensed conduct, the Superintendent may impose fines of not more than $5,000 per violation.

To protect the public interest, the Superintendent is permitted to suspend a loan originator license, without a prior hearing, for specified violations or misconduct.   The Superintendent is required to adopt rules establishing the maximum amount of time such a suspension may continue before a hearing is conducted.

The act requires the Superintendent to regularly report violations of the law, as well as enforcement actions and other relevant information, to the NMLSR.  In addition, each licensee is required to submit to the NMLSR call reports or other reports of condition, which must be in the form and contain the information required by the NMLSR.

Information shared with NMLSR; confidentiality; challenge process

(R.C. 1321.531(B), 1321.55, 1322.031(I), and 1322.061)

The Superintendent of Financial Institutions is authorized to establish relationships or enter into contracts with the NMLSR, or any entities designated by it, to collect and maintain records and process transaction fees or other fees related to loan originator licensees or other persons subject to or involved in their licensure.   In order to "promote more effective regulation and reduce regulatory burden through supervisory information sharing," the Superintendent may also enter into sharing arrangements with other governmental agencies, the Conference of State Bank Supervisors, and the American Association of Residential Mortgage Regulators.

The act states that any confidentiality or privilege arising under federal or state law with respect to any information or material provided to the NMLSR continues to apply to the information or material after the information or material has been provided to the NMLSR.  That information and material may be shared with all state and federal regulatory officials with mortgage industry oversight authority without the loss of confidentiality or privilege protections provided by federal law or the law of any state.  This provision does not apply, however, with respect to information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions against, loan originators that is included in the NMLSR for access by the public.

Information or material to which confidentiality or privilege applies is not subject to any of the following:

(1)  Disclosure under any federal or state law governing disclosure to the public of information held by an officer or an agency of the federal government or of the respective state;

(2)  Subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless the person to whom such information or material pertains waives, in whole or in part and at the discretion of the person, any privilege held by the NMLSR with respect to that information or material.

Generally, the act provides that any state law, including the Public Records Law, relating to the disclosure of confidential supervisory information that is inconsistent with these provisions of the act are superseded by the act's requirements.

The act requires the Superintendent to establish a process by which loan originators may challenge information provided to the NMLSR by the Superintendent.  That process must be established by rule adopted in accordance with R.C. Chapter 119.

Rule-making authority

In general

(R.C. 1321.54(A))

The Division of Financial Institutions is permitted by ongoing law to adopt rules that are necessary for the enforcement of the Mortgage Loan Law and that are consistent with that law.  The act additionally authorizes the adoption of rules that are necessary for the administration of the law and are consistent with the law and rules to carry out the purposes of the law.

Under prior law, each rule had to contain a reference to the statutory provision to which it applied.  In addition, the Division was required to send a copy of each newly adopted rule by regular mail to every registrant.  The act removes these requirements.

If the S.A.F.E. Act is subsequently modified

(R.C. 1321.552 and 1322.025)

The act provides that--if the S.A.F.E. Act is modified after the effective date of this provision of the act, or if any regulation, statement, or position is adopted under the S.A.F.E. Act, and the item modified or adopted affects any matter within the scope of this portion of the act--the Superintendent of Financial Institutions may by rule adopt a similar provision.  The rule is to be adopted in accordance with section 111.15 of the Revised Code, not R.C. Chapter 119. (the Administrative Procedure Act).

A rule so adopted by the Superintendent is effective on the later of (1) the date the Superintendent issues the rule or (2) the date the regulation, rule, interpretation, procedure, or guideline the Superintendent's rule is based on becomes effective. The Superintendent may, upon 30 day's written notice, revoke any rule adopted under this authority.  A rule adopted and not revoked by the Superintendent lapses 18 months after the rule's effective date.

Transition to licensed loan originators

(Section 745.60 and 812.20)

These provisions of the act apply on and after January 1, 2010.  The Division of Financial Institutions is required to begin accepting applications for a mortgage loan originator license under the Mortgage Loan Law on the act's effective date.  Individuals holding a valid loan officer license under the Mortgage Brokers Law as of January 1, 2010, are not required to be in compliance with the act's loan originator requirements until the first renewal of their license after that date.

Conforming changes

(R.C. 1343.011, 1345.01, 1345.05, 1345.09, 1349.31, and 1349.43)

Due to the elimination of the "loan officer" license and the creation of the "mortgage loan originator" and "loan originator" licenses, the act makes several cross-reference changes in other areas of the law.

Credit union compliance with the federal S.A.F.E. Act

(R.C. 1733.252 and 1733.269)

The act states that each credit union, the subsidiaries of the credit union, and the loan originators employed by the credit union must comply with the federal S.A.F.E. Act. (See "Implementation of the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ("S.A.F.E. Act"), above.)  Among other things, the S.A.F.E. Act requires that residential mortgage loan originators who are employees of a depository institution or its subsidiaries be registered with the Nationwide Mortgage Licensing System and Registry (NMLSR)--a mortgage licensing system developed and maintained by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators for the licensing and registration of loan originators.  The term "depository institution" includes any credit union.  Under the S.A.F.E. Act, the federal regulators of depository institutions must develop and maintain a system for registering the institutions' employees who originate residential mortgage loans.

The federal regulator of credit unions, the National Credit Union Administration, oversees only federally insured credit unions.  Consequently, the act separately addresses compliance by credit unions that are not federally insured (that is, they are insured by a credit union share guaranty corporation established under Ohio law (R.C. Chapter 1761.)).  These credit unions, their subsidiaries, and the loan originators employed by them are required to comply with the S.A.F.E. Act as determined by the Superintendent of Financial Institutions by rule.  At a minimum, the rules must require these loan originators to furnish to the NMLSR information concerning the loan originator's identity and be consistent with the requirements for federally insured credit unions adopted by the National Credit Union Administration pursuant to the S.A.F.E. Act.  These rules must be adopted in accordance with the Administrative Procedure Act (R.C. Chapter 119.).

These provisions of the act apply on and after January 1, 2010.

Regulation of mortgage lenders under the Mortgage Loan Law

Registration required; exemptions

(R.C. 1321.51(Q) and (U), 1321.52, and 1321.53(D))

The Mortgage Loan Law (R.C. 1321.51 to 1321.60) formerly prohibited any person from doing either of the following without having first obtained a certificate of registration from the Division of Financial Institutions:

(1)  Advertise, solicit, or hold out that the person is engaged in the business of making loans secured by a mortgage on a borrower's real estate which is other than a first lien on the real estate;

(2)  Engage in the business of lending or collecting the person's own or another person's money, credit, or chooses in action for such loans.

The act amends these provisions, as follows:

--In (1), above, the act specifies that the loans are "residential mortgage" loans, and defines "residential mortgage loans" as any loan primarily for personal, family, or household use that is secured by a mortgage or other consensual security interest on a dwelling or on residential real estate upon which is constructed or intended to be constructed a dwelling.

--In (2), above, the act specifies that the loans are "non-first lien residential mortgage" loans.

--The act expands the activities for which a person must be registered by adding the following:  (a) employing or compensating mortgage loan originators licensed or who should be licensed under the Mortgage Loan Law to conduct the business of making residential mortgage loans and (b) making unsecured loans or  loans secured by other than real property, which loans are for more than $5,000 at a rate of interest greater than permitted by the Usury Law (R.C. 1343.01) or any specific provision of the Revised Code.

The act revises the list of persons exempt from registration under the Mortgage Loan Law as follows:

--The prior exemption for persons lawfully doing business under the authority of this state, another state, or the United States relating to banks, savings banks, trust companies, savings and loan associations, or credit unions is modified to read as follows: "entities chartered and lawfully doing business under the authority of this state, another state, or the United States as a bank, savings bank, trust company, savings and loan association, or credit union, or a subsidiary of any such entity, which subsidiary is regulated by a federal banking agency and is owned and controlled by such a depository institution."  The act defines "federal banking agency" as the Board of Governors of the Federal Reserve System, the Comptroller of the Currency, the Director of the Office of Thrift Supervision, the National Credit Union Administration, and the Federal Deposit Insurance Corporation.

--The prior exemption for "governmental agencies or instrumentalities" is modified to expressly include any political subdivision, or any governmental or other public entity, corporation, instrumentality, or agency, in or of the United States or any state of the United States.

--The act adds a new exemption for a college or university, or controlled entity of a college or university, as those terms are defined in R.C. 1713.05.

--The act also adds an exemption for credit union service organizations, provided the organization utilizes services provided by registered mortgage loan originators or the organization holds a valid letter of exemption issued by the Superintendent of Financial Institutions (see "Credit union service organization exemption requirements," below).

Application; investigation

(R.C. 109.572, 1321.20, 1321.51(R) and (EE), and 1321.53)

Prior law required an application for a certificate of registration to include, among other things, the location where the business was to be conducted and the names and addresses of the partners, officers, or trustees of the applicant.  The act removes this specific requirement.  Prior law also required that the applicant pay a $200 investigation fee and an annual registration fee determined by the Superintendent of Financial Institutions as provided by law.[70]  The act specifies that the investigation fee is nonrefundable, that the annual registration fee is $300 and is nonrefundable, and that the applicant also must pay any additional fee required by the Nationwide Mortgage Licensing System and Registry.  The "Nationwide Mortgage Licensing System and Registry" (NMLSR) is a mortgage licensing system developed and maintained by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, or their successor entities, for the licensing and registration of mortgage loan originators, or any system established by the Secretary of Housing and Urban Development pursuant to the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ("S.A.F.E. Act").

The act requires all applicants making loans secured by an interest in real estate to designate an employee or owner of the applicant as the applicant's primary point of contact--that is, the individual who the Division of Financial Institutions can contact regarding compliance or licensing matters relating to the registrant's or applicant's business or lending activities secured by an interest in real estate.  While acting as the primary point of contact, the employee or owner cannot be employed by any other registrant or mortgage broker.

The act specifies that the investigation undertaken upon application must include both a civil and criminal records check of the applicant, including any individual whose identity is required to be disclosed in the application.  Where the applicant is a business entity, the Superintendent may require a civil and criminal background check of those persons that in the determination of the Superintendent have the authority to direct and control the operations of the applicant.

The Superintendent is required to obtain a criminal history records check and, as part of that records check, request that criminal record information from the FBI be obtained.  To fulfill this requirement, the Superintendent is to either (1) request the Superintendent of the Bureau of Criminal Identification and Investigation, or a vendor approved by the Bureau, to conduct a criminal records check based on the applicant's fingerprints (or, if the fingerprints are unreadable, based on the applicant's social security number) or (2) authorize the NMLSR to request a criminal history background check. Any fee required by the Bureau or by the NMLSR is to be paid by the applicant.

The act prohibits the Superintendent from using a credit score as the sole basis for a registration denial.

Renewal

(R.C. 1321.52(D) and 1321.53(A)(7) and (8))

The act states that certificates of registration issued on or after July 1, 2010, annually expire on December 31, unless renewed by the filing of a renewal application and payment of a $300 nonrefundable annual registration fee, any assessment (see directly below), and any additional fee required by the NMLSR.  If a renewal application does not contain all of the information required, and if that information is not submitted to the Division of Financial Institutions within 90 days after the Superintendent of Financial Institutions requests the information in writing, the Superintendent may consider the application withdrawn.  Renewal cannot be granted if the applicant's certification of registration is subject to an order of suspension, revocation, or an unpaid and past due fine imposed by the Superintendent.

Formerly, if there was a change of 10% or more in the ownership of a registrant, the Division was permitted to make any investigation necessary to determine whether any condition exists that, if it had existed at the time of the original application, the condition would have warranted a denial.  The act changes the threshold to 5%.

If a person's registration terminates due to nonrenewal or otherwise, but the person continues to engage in the business of collecting or servicing non-first lien residential mortgage loans in violation of the law, the act authorizes the Superintendent to take administrative action, including action on any subsequent application for a certificate of registration.  In addition, no late fee, back check charge except as incurred, charge related to default or cost to realize on its security interest, or prepayment penalty on non-first lien residential mortgage loans can be collected or retained by a person who is in violation, for the period of time in which the person is in violation.  Nothing in this provision precludes any other actions or penalties provided by law or modifies a defense of holder in due course that a subsequent purchaser servicing the residential mortgage loan may raise.

Assessments

(R.C. 1321.53(A)(7)(a)(ii))

Under ongoing law, if the annual registration fees billed by the Superintendent are less than the estimated expenditures of the Consumer Finance section of the Division, as determined by the Superintendent, for the following fiscal year, the Superintendent may assess each registrant at a rate sufficient to equal in the aggregate the difference between the annual registration fees billed and the estimated expenditures.  The assessed amount must be paid prior to the last day of June.  The maximum amount that can be assessed a registrant is $.10 per each $100 of interest (excluding charge-off recoveries), points, loan origination charges, and credit line charges collected by that registrant during the previous calendar year.  If an assessment is imposed, it cannot be less than $250 per registrant and cannot exceed $30,000 less the total annual registration fees paid by each registrant.

Net worth or bond requirement

(R.C. 1321.53(B) and 1321.533(A)(1) and (B) to (F))

Formerly, each registrant had to maintain a net worth of at least $50,000 and, for each certificate of registration, assets of at least $50,000 either in use or readily available for use in the conduct of business.  Under the act, a registrant may comply with that net worth and asset requirement or obtain a corporate surety bond issued by a bonding company or insurance company authorized to do business in Ohio.  All of the following conditions apply to the bond:

(1)  The bond must be in favor of the Superintendent of Financial Institutions.

(2)  The bond must be in the penal sum of one-half per cent of the aggregate loan amount of residential mortgage loans originated in the immediately preceding calendar year, but not exceeding $150,000.  The bond cannot, however, be less than $50,000 and an additional penal sum of $10,000 for each location, in excess of one, at which the registrant conducts business.

(3)  The term of the bond must coincide with the term of registration.

(4)  A copy of the bond must be filed with the Superintendent.

(5)  The bond must be for the exclusive benefit of any borrower injured by a violation by an employee, licensee, or registrant of any provision of the Mortgage Loan Law or the rules adopted thereunder.

(6)  The aggregate liability of the corporate surety for any and all breaches of the conditions of the bond cannot exceed the penal sum of the bond.

The act requires any registrant that fails to comply with this provision to cease all mortgage lender activity in this state until the registrant has so complied.

Permissible fees and other charges

(R.C. 1321.57)

Ongoing law specifies the interest and charges that may be received by a registrant.  With respect to a loan secured by an interest in real estate, such charges include certain closing costs, if they are bona fide, reasonable in amount, and not for the purpose of circumvention or evasion of the law.  The act adds that they also must be "paid to third parties."

These permissible closing costs continue to include "settlement or closing costs."  The act specifies, however, that they must be "paid to unaffiliated third parties."

Other permissible closing costs under ongoing law include fees for preparation of mortgage documents, appraisal fees, and fees for any federally mandated inspection, if such fees are not paid to the registrant or an employee of the registrant.  Formerly, those fees also could not be paid to a person related to a registrant.  The act replaces "related to" with "affiliated with."

Certain loan origination charges are also permissible under ongoing law, both with respect to secured loans and unsecured loans.  The act specifies that secured loans are those secured by goods or real estate, and unsecured loans are those that are not secured by goods or real estate.  The act also revises the threshold loan amounts upon which the amount of the loan origination charge is to be determined.  Under prior law, if the principal amount of the secured or unsecured loan was less than $500, the loan origination charges could not exceed $15.  If the principal amount of the loan was at least $500 but less than $1,000, the loan origination charges could not exceed $30.  Under the act, the first threshold is changed to $500 or less and the second threshold is changed to more than $500 but less than $1,000.

Choice of law

(R.C. 1321.52(B))

Ongoing law states that loans made to persons who at the time are Ohio residents are subject to Ohio law, regardless of any statement in the contract to the contrary.  The act provides several exceptions.  If the loan is primarily secured by a lien on real property in another state and is arranged by a mortgage loan originator licensed by that state, the borrower may by choice of law designate that the transaction be governed by the law where the real property is located if the other state has consumer protection laws covering the borrower that are applicable to the transaction. Additionally, if the loan is for the purpose of purchasing goods acquired by the borrower when the borrower is outside of Ohio, the loan may be governed by the laws of the other state. However, nothing prevents a choice of law or requires registration or licensure of persons outside this state in a transaction involving the solicitation of Ohio residents to obtain non-real estate secured loans that require the borrowers to physically visit a lender's out-of-state office to apply for and obtain the disbursement of loan funds.

Duties and standards of care

(R.C. 1321.593)

Under the act, a registrant and any person required to be registered must do all of the following in connection with the business of making or offering to make residential mortgage loans:

(1)  Safeguard and account for any money handled for the borrower;

(2)  Follow reasonable and lawful instructions from the borrower;

(3)  Act with reasonable skill, care, and diligence;

(4)  Act in good faith and with fair dealing in any transaction, practice, or course of business in connection with making any residential mortgage loan.

The act provides that these duties and standards of care cannot be waived or modified. They do not apply, however, to wholesale lenders.[71]

Required disclosures; advertising

(R.C. 1321.592, 1321.594, and 1321.60)

The act imposes numerous disclosure requirements on registrants, including the following:

In connection with providing a non-brokered loan secured by a lien on real property, a registrant must, not earlier than three business days nor later than 24 hours before the loan is closed, deliver to the borrower a written disclosure that includes (1) a statement indicating whether property taxes or any insurance will be escrowed and (2) a description of what is covered by the regular monthly payment, including principal, interest, taxes, and insurance, as applicable.

If a residential mortgage loan applied for will exceed 90% of the value of the real property, the registrant must provide a statement to the borrower within three business days after taking the loan application, printed in boldface type of the minimum size of sixteen points, as follows: "You are applying for a loan that is more than 90% of your home's value. It will be hard for you to refinance this loan. If you sell your home, you might owe more money on the loan than you get from the sale."

The act also prohibits a registrant, in connection with making a non-brokered residential mortgage, from failing to do either of the following:

(1)  Timely inform the borrower of any material change in the terms of the residential mortgage loan.  "Material change" means:  (a) a change in the type of residential mortgage loan being offered, such as a fixed or variable rate loan or a loan with a balloon payment, (b) a change in the term of the loan, as reflected in the number of monthly payments due before a final payment is scheduled to be made, (c) a change in the interest rate of more than 0.15%, (d) a change in the regular total monthly payment, including principal, interest, any required mortgage insurance, and any escrowed taxes or property insurance, of more than 5%, (e) a change regarding whether the escrow of taxes or insurance will be required, or (f) a change regarding whether private mortgage insurance will be required.

(2)  Timely inform the borrower if any fees payable by the borrower to the licensee, registrant, or lender increase by more than 10% or $100, whichever is greater.

To be considered "timely," the registrant must provide the borrower with the revised information not later than the time requirement imposed by the federal Truth in Lending Act, as those provisions of law exist on July 31, 2009.[72]  If an increase in the total amount of the fee to be paid by the borrower to the registrant is not disclosed in accordance with this provision of the act, the registrant must refund to the borrower the amount by which the fee was increased.  If the fee is financed into the loan, the registrant must also refund the interest that would accrue over the term of the loan on that excess amount.

Under ongoing law, advertising for loans cannot be false, misleading, or deceptive.  The act states that "false, misleading, or deceptive advertising" includes the following:

--Placing, or causing to be placed, any advertisement indicating that special terms, reduced rates, guaranteed rates, particular rates, or any other special feature of mortgage loans is available unless the advertisement clearly states any limitations that apply;

-- Placing, or causing to be placed, any advertisement containing a rate or special fee offer that is not a bona fide available rate or fee.

Additionally, the act requires registrants to comply with Regulation Z of the federal Truth in Lending Act (12 C.F.R. 226.16) in making any advertisement.

Prohibitions; penalties

(R.C. 1321.55(I), 1321.551(F), 1321.59, 1321.591, and 1321.99)

The act prohibits a registrant, though its managers or otherwise, from failing to reasonably supervise mortgage loan originators or other persons employed by or associated with the registrant.  In addition, registrants cannot fail to establish reasonable procedures designed to avoid violations of the Mortgage Loan Law or rules adopted thereunder, or violations of applicable state and federal consumer and lending laws or rules, by mortgage loan originators or other persons employed by or associated with the registrant.

Generally, the act also prohibits registrants and mortgage loan originators from doing any of the following:

(1)  Obtaining a certificate through any false or fraudulent representation of a material fact or any omission of a material fact required by state or federal law, or making any substantial misrepresentation in the application, to engage in lending secured by real estate;

(2)  Knowingly making false or misleading statements of a material fact, omissions of statements required by state or federal law, or false promises regarding a material fact, through advertising or other means, or engaging in a continued course of misrepresentations, in connection with the business of making or offering to make residential mortgage loans;

(3)  Knowingly engaging in conduct in connection with the business of making or offering to make residential mortgage loans in conduct that constitutes improper, fraudulent, or dishonest dealings;

(4)  While involved in the business of making or offering to make residential mortgage loans, failing to notify the Division of Financial Institutions within 30 days after knowing that the registrant or licensee has (a) been convicted of or pleaded guilty to a felony offense in a domestic, foreign, or military court, (b) been convicted of or pleaded guilty to any criminal offense involving theft, receiving stolen property, embezzlement, forgery, fraud, passing bad checks, money laundering, breach of trust, dishonesty, or drug trafficking, or any criminal offense involving money or securities, in a domestic, foreign, or military court, or (c) had a certificate of registration or loan originator license, or comparable authority, revoked in any governmental jurisdiction.

(5)  Knowingly making, proposing, or soliciting fraudulent, false, or misleading statements on any mortgage loan document or on any document related to a mortgage loan, including a mortgage application, real estate appraisal, or real estate settlement or closing document.  "Fraudulent, false, or misleading statements" does not include mathematical errors, inadvertent transposition of numbers, typographical errors, or any other bona fide error.

(6)  Knowingly instructing, soliciting, proposing, or otherwise causing a borrower to sign in blank a loan related document in connection with a residential mortgage loan;

(7)  Knowingly compensating, instructing, inducing, coercing, or intimidating, or attempting to compensate, instruct, induce, coerce, or intimidate, a person licensed or certified as an appraiser under Ohio law for the purpose of corrupting or improperly influencing the independent judgment of the person with respect to the value of the dwelling offered as security for repayment of a mortgage loan;

(8)  Willfully retaining original documents provided to the registrant or licensee by the borrower in connection with the residential mortgage loan application, including income tax returns, account statements, or other financial related documents.

(9)  In connection with making residential mortgage loans, receiving, directly or indirectly, a premium on the fees charged for services performed by a bona fide third party.[73]

(10)  In connection with making residential mortgage loans, paying or receiving, directly or indirectly, a referral fee or kickback of any kind to or from a bona fide third party or other party with a related interest in the transaction, including a home improvement builder, real estate developer, or real estate broker or agent, for the referral of business.  This provision does not, however, prevent remuneration to a registrant or licensee for the licensed sale of any insurance product permitted under ongoing law, provided there is no additional fee or premium added to the cost for the insurance and paid directly or indirectly by the borrower.

(11)  In connection with making or offering to make residential mortgage loans, engaging in any unfair, deceptive, or unconscionable act or practice prohibited under R.C. 1345.01 to 1345.13 of the Consumer Sales Practices Act;

(12)  Failing to follow the practices set forth in the federal Fair Debt Collection Practices Act,[74] notwithstanding the fact that the registrant or licensee is seeking to collect upon the registrant's own debt;

(13)  In connection with any examination or investigation conducted by the Superintendent, knowingly doing any of the following:  (a) circumventing, interfering with, obstructing, or failing to cooperate, including making a false or misleading statement, failing to produce records, or intimidating or suborning any witness, (b) withholding, abstracting, removing, mutilating, destroying, or secreting any books, records, computer records, or other information, or (c) tampering with, altering, or manufacturing any evidence.

Enforcement; administrative actions; reports to NMLSR

(R.C. 1321.54)

Under prior law, the Division of Financial Institutions was required to revoke, suspend, or refuse to renew a lender's certificate of registration under the Mortgage Loan Law, or impose a monetary fine, if it determined that the registrant had continued to violate the Law after receiving notice of the violation from the Division or that the registrant was in default in the payment of the annual assessment or certificate of registration fee.  Under the act,  the Division may revoke, suspend, or refuse to renew any certificate of registration if it specifically finds any of the following:

(1)  A violation of or failure to comply with any provision of the Mortgage Loan Law or the rules adopted thereunder, any federal lending law, or any other law applicable to the business conducted under a certificate of registration;

(2)  The person has been convicted of or pleaded guilty to a felony offense in a domestic, foreign, or military court;

(3)  The person has been convicted of or pleaded guilty to any criminal offense involving theft, receiving stolen property, embezzlement, forgery, fraud, passing bad checks, money laundering, breach of trust, dishonesty, or drug trafficking, or any criminal offense involving money or securities, in a domestic, foreign, or military court;

(4)  The person's certificate of registration, or comparable authority, has been revoked in any governmental jurisdiction.

The act permits the Division to impose a monetary fine in addition to, or in lieu of, any revocation, suspension, or denial of a certificate.

Ongoing law specifies that the revocation, suspension, or refusal to renew does not impair the obligation of any preexisting lawful contract made under the law.  The act provides, however, that a prior registrant must make good faith efforts to promptly transfer the registrant's collection rights to another registrant or person exempt from registration, or be subject to additional monetary fines and legal or administrative action by the Division.  This provision does not limit a court's ability to impose a cease and desist order preventing any further business or servicing activity.

The Superintendent of Financial Institutions may also impose a fine for a violation of the Mortgage Loan Law, or any rule adopted thereunder.  Under ongoing law, these monetary fines cannot exceed $25,000.  All fines collected are to be paid to the Treasurer of State to the credit of the ongoing Consumer Finance Fund.

In determining the amount of a fine to be imposed, the Superintendent is authorized by the act to consider all of the following to the extent it is known to the Division:

(1)  The seriousness of the violation;

(2)  The registrant's good faith efforts to prevent the violation;

(3)  The registrant's history regarding violations and compliance with Division orders;

(4)  The registrant's financial resources;

(5)  Any other matters the Superintendent considers appropriate in enforcing these provisions.

The act states that imposition of monetary fines under this provision does not preclude the imposition of any criminal fine.

If the Superintendent makes application to the court of common pleas for an order enjoining a person from acting as a registrant without being registered, the Superintendent may also seek civil penalties for that unregistered conduct in an amount not to exceed $5,000 per violation.  In addition, if the Superintendent takes administrative action to enjoin such unregistered conduct, the Superintendent may impose fines of not more than $5,000 per violation.

To "protect the public interest," the Superintendent is permitted to suspend a certificate of registration, without a prior hearing, for specified violations or misconduct.  The Superintendent is required to adopt rules establishing the maximum amount of time such a suspension may continue before a hearing is conducted.

The act requires the Superintendent to regularly report violations of the Mortgage Loan Law, as well as enforcement actions and other relevant information, to the NMLSR.

Confidentiality

(R.C. 1321.55)

The act modifies the confidentiality provisions of the Mortgage Loan Law.  Under the act, the following information is confidential:

(1)  Examination information, and any information leading to or arising from an examination;

(2)  Investigation information, and any information arising from or leading to an investigation.

This information is to remain confidential for all purposes except when it is necessary for the Superintendent of Financial Institutions to take official action regarding the affairs of a registrant or licensee, or in connection with criminal or civil proceedings to be initiated by a prosecuting attorney or the Attorney General.  This information may also be introduced into evidence or disclosed when and in the manner authorized by ongoing law (R.C. 1181.25).

All application information, except social security numbers, employer identification numbers, financial account numbers, the identity of the institution where financial accounts are maintained, personal financial information, fingerprint cards and the information contained on such cards, and criminal background information, is a public record as defined in section 149.43 of the Revised Code.

These provisions do not prevent the Division of Financial Institutions from releasing to or exchanging with other financial institution regulatory authorities information relating to registrants and licensees.  For this purpose, a "financial institution regulatory authority" includes a regulator of a business activity in which a registrant or licensee is engaged, or has applied to engage in, to the extent that the regulator has jurisdiction over a registrant engaged in that business activity.  A registrant or licensee is engaged in a business activity, and a regulator of that business activity has jurisdiction over the registrant or licensee, whether the registrant conducts the activity directly or a subsidiary or affiliate of the registrant or licensee conducts the activity.

In order to "promote more effective regulation and reduce regulatory burden through supervisory information sharing," the Superintendent is permitted to enter into sharing arrangements with other governmental agencies, the Conference of State Bank Supervisors, and the American Association of Residential Mortgage Regulators.

These provisions do not prevent the Division from releasing information relating to registrants or licensees to the Attorney General, to the Superintendent of Real Estate and Professional Licensing for purposes relating to the administration of R.C. Chapters 4735. and 4763., to the Superintendent of Insurance for purposes relating to the administration of R.C. Chapter 3953., to the Commissioner of Securities for purposes relating to the administration of R.C. Chapter 1707., or to local law enforcement agencies and local prosecutors.  Information the Division releases remains confidential.

Credit union service organization exemption requirements

(R.C. 1321.522 and 1321.53(D)(6))

A credit union service organization seeking exemption from registration under the Mortgage Loan Law is required by the act to submit an application to the Superintendent of Financial Institutions along with a nonrefundable fee of $350 for each location of an office to be maintained by the organization. The application must be in a form prescribed by the Superintendent and include all of the following:

(1)  The organization's business name and state of incorporation;

(2)  The names of the owners, officers, or partners having control of the organization;

(3)  An attestation to all of the following:

(a)  That the organization and its owners, officers, or partners have not had a mortgage lender certificate of registration or mortgage loan originator license, or any comparable authority, revoked in any governmental jurisdiction;

(b)  That the organization and its owners, officers, or partners have not been convicted of, or pleaded guilty to, any of the following in a domestic, foreign, or military court:

--During the seven-year period immediately preceding the date of application for exemption, any felony or a misdemeanor involving theft;

--At any time prior to the date of application for exemption, a felony involving an act of fraud, dishonesty, a breach of trust, theft, or money laundering.

(c)  That, with respect to financing residential mortgage loans, the organization conducts business with Ohio residents or secures its loans with property located in Ohio;

(4)  The names of all mortgage loan originators or licensees under the organization's control and direction;

(5)  An acknowledgment of understanding that the organization is subject to the regulatory authority of the Division of Financial Institutions;

(6)  Any further information that the Superintendent may require.

If the Superintendent determines that the credit union service organization  honestly made the required attestation and otherwise qualifies for exemption, the Superintendent must issue a letter of exemption.  Additional certified copies of a letter of exemption are to be provided upon request and the payment of $75 per copy.  If the Superintendent determines that the organization does not qualify for exemption, the Superintendent is to issue a notice of denial, and the organization may request a hearing in accordance with R.C. Chapter 119.

All of the following conditions apply to any credit union service organization holding a valid letter of exemption:

--The organization is subject to examination in the same manner as a registrant with respect to the conduct of the organization's mortgage loan originators.  In conducting any out-of-state examination, the organization is responsible for paying the costs of the Division in the same manner as a registrant.

--The organization has an affirmative duty to supervise the conduct of its mortgage loan originators, and to cooperate with investigations by the Division with respect to that conduct, in the same manner as is required of registrants.

--The organization is to keep and maintain records of all transactions relating to the conduct of its mortgage loan originators in the same manner as is required of registrants.

--The organization may provide the surety bond for its mortgage loan originators in the same manner as is permitted for registrants.

A letter of exemption expires annually on December 31, and may be renewed on or before that date by submitting an application that meets the requirements described above and a nonrefundable renewal fee of $350 for each location of an office to be maintained by the organization.

The Superintendent is authorized to issue a notice to revoke or suspend a letter of exemption if the Superintendent finds that the letter was obtained through a false or fraudulent representation of a material fact, or the omission of a material fact, required by law, or that a condition for exemption is no longer being met.  Prior to issuing an order of revocation or suspension, the credit union service organization must be given an opportunity for a hearing in accordance with R.C. Chapter 119.

All information obtained by the Division pursuant to an examination or investigation is subject to the confidentiality requirements set forth in the Mortgage Loan Law.  All money collected is to be deposited into the state treasury to the credit of the ongoing Consumer Finance Fund.

Transition to the new requirements

(Section 745.60)

These provisions of the act apply on and after January 1, 2010.  The Division of Financial Institutions is required to begin accepting applications for an exemption from registration under the Mortgage Loan Law on the act's effective date.  Individuals holding a valid mortgage lender certificate of registration under the Mortgage Loan Law as of January 1, 2010, are not required to be in compliance with the act's requirements until the first renewal of their certificate after that date.

Regulation of mortgage brokers under the Mortgage Brokers Law

Registration required; exemptions

(R.C. 1322.01, 1322.02, and 1322.024)

The ongoing Mortgage Brokers Law (R.C. 1322.01 to 1322.12) prohibits any person from acting as a mortgage broker without first having obtained a certificate of registration from the Superintendent of Financial Institutions for every office to be maintained by the person for the transaction of business as a mortgage broker in Ohio.  "Mortgage broker" is defined as any of the following:

(1)  A person that holds that person out as being able to assist a buyer in obtaining a mortgage and charges or receives from either the buyer or lender valuable consideration for providing this assistance;

(2)  A person that solicits financial and mortgage information from the public, provides that information to a mortgage broker, and charge or receives from the mortgage broker valuable consideration for providing the information;

(3)  A person engaged in table-funding or warehouse-lending mortgage loans that are first lien mortgage loans.

The act substantially retains this definition.  In (2), above, it adds that the information may be provided to a person making residential mortgage loans, in addition to a mortgage broker.  And in (3), above, it clarifies that the loans are first lien residential mortgage loans.

Whereas prior law listed the persons that were exempt from the Mortgage Brokers Law,[75] the act specifies what the term "mortgage broker" does not include.  Under the act, "mortgage broker" does not include any of the following:

(1)  A person that makes residential mortgage loans and receives a scheduled payment on each of those mortgage loans;

(2)  Any entity chartered and lawfully doing business under the authority of any law of this state, another state, or the United States as a bank, savings bank, trust company, savings and loan association, or credit union, or a subsidiary of any such entity, which subsidiary is regulated by a federal banking agency and is owned and controlled by a depository institution;

(3)  A consumer reporting agency that is in substantial compliance with the federal Fair Credit Reporting Act;

(4)  Any political subdivision, or any governmental or other public entity, corporation, instrumentality, or agency, in or of the United States or any state;

(5)  A college or university, or controlled entity of a college or university, as those terms are defined in R.C. 1713.05;

(6)  Any entity created solely for the purpose of securitizing loans secured by an interest in real estate, provided the entity does not service the loans. For this purpose, "securitizing" means the packaging and sale of mortgage loans as a unit for sale as investment securities, but only to the extent of those activities.

(7)  Any person engaged in the retail sale of manufactured or mobile homes or industrialized units if, in connection with obtaining financing by others for those retail sales, the person only assists the borrower by providing or transmitting the loan application and does not do any of the following:

(a)  Offer or negotiate the residential mortgage loan rates or terms;

(b)  Provide any counseling with borrowers about residential mortgage loan rates or terms;

(c)  Receive any payment or fee from any company or individual for assisting the borrower obtain or apply for financing to purchase the manufactured or mobile home or industrialized unit;

(d)  Assist the borrower in completing the residential mortgage loan application.

(8)  A mortgage banker, provided it holds a valid letter of exemption issued by the Superintendent (see "Mortgage banker exemption requirements," below).  The act defines "mortgage banker" as any person that makes, services, buys, or sells residential mortgage loans secured by a first lien, that underwrites the loans, and that meets at least one of the following criteria:

(a)  The person has been directly approved by the U.S. Department of Housing and Urban Development (HUD) as a nonsupervised mortgagee with participation in the direct endorsement program.  This provision includes a person that has been directly approved by HUD as a nonsupervised mortgagee with participation in the direct endorsement program and that makes loans in excess of the applicable loan limit set by the Federal National Mortgage Association, provided that the loans in all respects, except loan amounts, comply with HUD's underwriting and documentation requirements.  This provision does not include a mortgagee approved as a loan correspondent.

(b)  The person has been directly approved by the Federal National Mortgage Association as a seller/servicer.  This provision includes a person that has been directly approved by the Federal National Mortgage Association as a seller/servicer and that makes loans in excess of the applicable loan limit set by the Association, provided that the loans in all respects, except loan amounts, comply with the underwriting and documentation requirements of the Association.

(c)  The person has been directly approved by the Federal Home Loan Mortgage Corporation as a seller/servicer.  This provision includes a person that has been directly approved by the Federal Home Loan Mortgage Corporation as a seller/servicer and that makes loans in excess of the applicable loan limit set by the Corporation, provided that the loans in all respects, except loan amounts, comply with the underwriting and documentation requirements of the Corporation.

(d)  The person has been directly approved by the U.S. Department of Veterans Affairs as a nonsupervised automatic lender. This provision does not include a person directly approved by the Department as a nonsupervised lender, an agent of a nonsupervised automatic lender, or an agent of a nonsupervised lender.

(9)  A nonprofit organization that is recognized as tax exempt under 26 U.S.C. 501(c)(3) and whose primary activity is the construction, remodeling, or rehabilitation of homes for use by low income families, provided that (a) the nonprofit organization makes no-profit mortgage loans or mortgage loans at 0% interest to low income families and no fees accrue directly to the nonprofit organization from those mortgage loans and that (b) the U.S. Department of Housing and Urban Development does not deny this exemption.

(10)  A credit union service organization, provided that the organization utilizes services provided by registered loan originators or that it holds a valid letter of exemption issued by the Superintendent (see "Credit union service organization exemption requirements," below).

The act authorizes the Superintendent, by rule, to expand the definition of mortgage broker by adding individuals, persons, or entities, or to exempt additional individuals, persons, or entities from the definition, if the Superintendent finds that the addition or exemption is consistent with the purposes fairly intended by the policy and provisions of the Mortgage Brokers Law and the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ("S.A.F.E. Act").  Such rules must be adopted in accordance with R.C. Chapter 119. (Administrative Procedure Act).

Application; operations manager; investigation; renewals

(R.C. 1322.01(U), 1322.03, 1322.04, 1322.051(A), and 1322.052)

Under prior law, an applicant for a certificate of registration as a mortgage broker, and an applicant for an annual renewal of that certificate, had to submit to the Division of Financial Institutions a fee of $350 for each location of an office to be maintained by the applicant.  Persons registered under the Mortgage Loan Law (R.C. 1321.51 to 1321.60), however, did not have to pay this fee when applying for or renewing a mortgage broker certificate of registration.  The act increases the application and renewal fee to $500 for each office location, and eliminates the exemption for registrants under the Mortgage Loan Law.

Under the act, applicants also must pay any additional fee required by the Nationwide Mortgage Licensing System and Registry.  The "Nationwide Mortgage Licensing System and Registry" (NMLSR) is a mortgage licensing system developed and maintained by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, or their successor entities, for the licensing and registration of mortgage loan originators, or any system established by the Secretary of Housing and Urban Development pursuant to the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008.

Ongoing law provides that, if a check or other draft instrument is returned to the Superintendent for insufficient funds, the Superintendent is to notify the registrant by certified mail, return receipt requested, that the certificate of registration issued in reliance on the check or other draft instrument will be canceled unless the registrant, within 30 days after receipt of the notice, submits the application fee and a $100 penalty to the Superintendent.  If the registrant does not submit the application fee and penalty within that time period, or if any check or other draft instrument used to pay the fee or penalty is returned for insufficient funds, the certificate of registration is to be canceled immediately without a hearing, and the registrant must cease activity as a mortgage broker.  The act applies the same requirements to situations in which a check or other draft instrument is returned to the Superintendent for insufficient funds before the certificate of registration has been issued.

Under ongoing law, an application must provide the location or locations where the business is to be transacted.  If any location is a residence, prior law required that the application be accompanied by a copy of a zoning permit authorizing the use of the residence for commercial purposes or a written opinion issued by the appropriate local government.  Under the act, the Superintendent may require such documents.  Additionally, the act eliminates the requirement that the application include a photograph of each business location.

Prior law required applicants that were business entities to designate an employee or owner as the applicant's operations manager.  The act requires all applicants to do so.  It also requires that the individual be licensed as a loan originator while acting as the operations manager (see "Implementation of the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ("S.A.F.E. Act," above) and not be employed by any other mortgage broker.  The act revises the pre-licensing instruction that is required of operations managers and the written test that must be successfully completed.

Though ongoing law requires the Superintendent to obtain a criminal history records check of the applicant and to request that criminal record information from the FBI be obtained, the act permits the Superintendent to authorize the NMLSR to request a criminal history background check.  It also requires that an investigation be conducted of any person whose identity is required to be disclosed on the application.  The Superintendent is authorized to establish relationships or enter into contracts with the NMLSR, or any entities designated by it, to collect and maintain records and process transaction fees or other fees related to mortgage broker certificates of registration or the persons associated with a mortgage broker.

To issue a certificate of registration, the Superintendent must determine, among other things, that neither the applicant nor any person whose identity is required to be disclosed on the application has had a mortgage broker certificate of registration or loan originator license, or any comparable authority, revoked in any governmental jurisdiction or has pleaded guilty to or been convicted of any of the following in a domestic, foreign, or military court:

(1)  During the seven-year period immediately preceding the date of application, any felony or a misdemeanor involving theft;

(2)  At any time prior to the date the application is approved, a felony involving an act of fraud, dishonesty, a breach of trust, theft, or money laundering.

The act also requires that, based on the totality of the circumstances and information submitted in the application, the applicant prove to the Superintendent, by a preponderance of the evidence, that the applicant is of good business repute, appears qualified to act as a mortgage broker, has fully complied with the Mortgage Brokers Law and the rules adopted thereunder, and meets all of the conditions for issuing a mortgage broker certificate of registration.  The Superintendent is prohibited by the act from using a credit score as the sole basis for registration denial.

Certificates may be renewed annually on or before December 31.  One condition that had to be met under prior law was that the operations manager completed at least six hours of continuing education during the preceding year.  The act increases the number of hours to eight and modifies the courses or programs of study that qualify.  Additional conditions for renewal include maintaining all necessary filings and approvals required by the Secretary of State and not being subject to an order of suspension or an unpaid and past due fine imposed by the Superintendent.

The act requires that, within 90 days after the departure of a designated operations manager, a registrant designate another person as operations manager.  If a registrant is without an operations manager approved by the Superintendent for more than 180 days, the registrant must cease operations unless otherwise authorized in writing by the Superintendent due to exigent circumstances.

Surety bond requirement

(R.C. 1322.05)

Ongoing law requires that each registrant obtain a corporate surety bond in favor of the Superintendent of Financial Institutions.  Under prior law, the bond had to be in the penal sum of at least $50,000 and an additional penal sum of $10,000 for each location, in excess of one, at which the registrant conducts business.  The act requires that the bond be in the penal sum of one-half per cent of the aggregate loan amount of residential mortgage loans originated in the immediately preceding calendar year, but not exceeding $150,000.  The bond cannot, however, be less than $50,000 and additional penal sum of $10,000 for each location, in excess of one, at which the registrant conducts business.

The bond is to be for the exclusive benefit of a buyer injured by a violation of the Mortgage Brokers Law, or any rule adopted thereunder, by the registrant, an employee of the registrant, or a loan originator employed by or associated with the registrant.

Call reports to NMLSR; annual reports

(R.C. 1322.06(C) and (D))

The act requires each registrant to submit to the NMLSR call reports or other reports of condition in the form required by the NMLSR.  In addition, each registrant must file with the Division of Financial Institutions an annual report under oath or affirmation, on forms supplied by the Division, concerning the business and operations of the registrant for the preceding calendar year.  If a registrant operates two or more registered offices, or two or more affiliated registrants operate registered offices, a composite report of the group of registered offices may be filed in lieu of individual reports.  Such reports are to be filed "as required by the Superintendent."

The Division is to publish annually an analysis of this information, but the individual reports are not to be considered public records.

Disclosures

(R.C. 1322.065)

Under the act, a person registered as a mortgage broker solely to sell leads of potential buyers to residential mortgage lenders or mortgage brokers, or solely to match buyers with residential mortgage lenders or mortgage brokers through a computerized loan origination system recognized by the U.S. Department of Housing and Urban Development, is required to make only those disclosures under the Mortgage Brokers Law that apply to the portion of the transaction during which they have direct buyer contact.  Those persons are, however, subject to all fair conduct and prohibition requirements in their dealing with buyers.

Advertising

(R.C. 1322.09(B))

The act requires mortgage brokers to comply with Regulation Z of the federal Truth in Lending Act in making any advertisement.

Prohibitions; penalties

(R.C. 1322.07, 1322.071, 1322.072, 1322.074, 1322.075, 1322.08, and 1322.99)

The act prohibits a registrant, through its operations manager or otherwise, from failing to (1) reasonably supervise a loan originator or other persons associated with the registrant or (2) establish reasonable procedures designed to avoid violations of the Mortgage Brokers Law or rules adopted thereunder, or violations of applicable state and federal consumer and lending laws or rules, by loan originators or other persons associated with the registrant.

The act modifies the ongoing limitations on the ownership or control of a majority interest in an appraisal company, and on referrals to an appraisal company, by making them apply to the immediate family of an owner of a registrant, rather than to the registrant's immediate family.[76]

Under ongoing law, registrants and loan originators (formerly, loan officers) are prohibited from engaging in certain conduct.  The act makes persons required to be registered or licensed under the Mortgage Brokers Law, and the individuals required to be disclosed in an application for a certificate of registration, subject to those prohibitions as well.  And it additionally prohibits the following:

(1)  Making false or misleading statements of a material fact, omissions of statements required by state or federal law, or false promises regarding a material fact, through advertising or other means, or engaging in a continued course of misrepresentations;

(2)  Failing to notify the Division of Financial Institutions within 30 days after (a) being convicted of or pleading guilty to a felony in a domestic, foreign, or military court, (b) being convicted of or pleading guilty to any criminal offense involving theft, receiving stolen property, embezzlement, forgery, fraud, passing bad checks, money laundering, breach of trust, dishonesty, or drug trafficking, or any criminal offense involving money or securities, or (c) having a mortgage broker certificate of registration or loan originator license, or comparable authority, revoked in any governmental jurisdiction;

(3)  Engaging in any unfair, deceptive, or unconscionable act or practice prohibited under R.C. 1345.01 to 1345.13 of the Consumer Sales Practices Act.

The act also prohibits any person, in connection with an examination or investigation conducted by the Superintendent under the Mortgage Brokers Law, from knowingly withholding, abstracting, removing, mutilating, destroying, or secreting any books, records, computer records, or other information.

Ongoing law prohibits registrants from receiving fees for assisting a buyer in obtaining a mortgage loan until all of the services the registrant has agreed to perform are completed and the proceeds of the loan have been disbursed.  Fees may, however, be paid for services performed by a bona fide third party in assisting the buyer to obtain a mortgage if the fees are paid directly by the buyer to the bona fide third party or the fees are deposited by the registrant into the registrant's special account for services performed by the bona fide third party.  The act specifies that these loans are residential mortgage loans and modifies the definition of special account.

Enforcement; administrative actions; damages

(R.C. 1322.10 and 1322.11)

The act adds the following as causes for the suspension, revocation, or refusal to issue or renew a certificate of registration:

--A violation of or failure to comply with federal lending law;

--A conviction of or guilty plea to a felony, or to any criminal offense involving a breach of trust or dishonesty, in a domestic, foreign, or military court;

--The revocation of a mortgage broker certificate of registration, or any comparable authority, in any governmental jurisdiction.

Ongoing law is modified by the act such that, if the Superintendent of Financial Institutions revokes a mortgage broker certificate of registration for any reason, the revocation is permanent and with prejudice.  Additionally, the act removes the requirement that the Superintendent suspend, without a prior hearing, the certificate of registration of a registrant whose operations manager has failed to fulfill the continuing education requirements or the license of a loan originator (formerly, loan officer) who has failed to fulfill those requirements.

The act permits the Superintendent to make application to the court of common pleas for an order enjoining any person from acting as a mortgage broker or registrant in violation of the registration requirement and to seek civil penalties for the unregistered conduct of not more than $5,000 per violation.  If the Superintendent, by administrative action, enjoins a person from such unregistered conduct, the Superintendent also may impose fines of not more than $5,000 per violation.

Mortgage banker exemption requirements

(R.C. 1322.01(G)(2)(h) and 1322.022)

A mortgage banker seeking exemption from registration under the Mortgage Brokers Law is required by the act to submit an application to the Superintendent of Financial Institutions along with a nonrefundable fee of $350 for each location of an office to be maintained by the mortgage banker. The application must be in a form prescribed by the Superintendent and include all of the following:

(1)  The mortgage banker's business name and state of incorporation or business registration;

(2)  The names of the owners, officers, or partners having control of the business;

(3)  An attestation to all of the following:

(a)  That the mortgage banker and its owners, officers, or partners have not had a mortgage banker license, mortgage broker certificate of registration, or loan originator license, or any comparable authority, revoked in any governmental jurisdiction;

(b)  That the mortgage banker and its owners, officers, or partners have not been convicted of, or pleaded guilty to, any of the following in a domestic, foreign, or military court:

--During the seven-year period immediately preceding the date of application for exemption, any felony or a misdemeanor involving theft;

--At any time prior to the date the application for exemption; is approved, a felony involving an act of fraud, dishonesty, a breach of trust, theft, or money laundering.

(c)  That, with respect to financing residential mortgage loans, the mortgage banker conducts business with residents of this state, or secures its loans with property located in this state, under authority of an approval described in R.C. 1322.01(G)(2)(h).

(4)  The names of all loan originators or licensees under the mortgage banker's control and direction;

(5)  An acknowledgment of understanding that the mortgage banker is subject to the regulatory authority of the Division of Financial Institutions;

(6)  Any further reasonable information that the Superintendent may require.

If the Superintendent determines that the mortgage banker honestly made the required attestation and otherwise qualifies for exemption, the Superintendent must issue a letter of exemption.  Additional certified copies of a letter of exemption are to be provided upon request and the payment of $75 per copy.  If the Superintendent determines that the mortgage banker does not qualify for exemption, the Superintendent is to issue a notice of denial, and the mortgage banker may request a hearing in accordance with R.C. Chapter 119.

All of the following conditions apply to any mortgage banker holding a valid letter of exemption:

(1)  The mortgage banker is subject to examination in the same manner as a registrant with respect to the conduct of the mortgage banker's loan originators.  In conducting any out-of-state examination, a mortgage banker is responsible for paying the costs of the Division in the same manner as a registrant.

(2)  The mortgage banker has an affirmative duty to supervise the conduct of its loan originators, and to cooperate with investigations by the Division with respect to that conduct, in the same manner as is required of registrants.

(3)  The mortgage banker is to keep and maintain records of all transactions relating to the conduct of its loan originators in the same manner as is required of registrants.

(4)  The mortgage banker may provide the surety bond for its loan originators in the same manner as is permitted for registrants.

A mortgage banker that holds a valid letter of exemption, and any licensed loan originator employed by the mortgage banker, are not subject to the disclosure requirements set forth in R.C. 1322.062 with respect to any transaction covered under the authority of an approval described in R.C. 1322.01(G)(2)(h).  Those disclosure requirements do apply, however, with respect to transactions not covered under the authority of such an approval.

A letter of exemption expires annually on December 31, and may be renewed on or before that date by submitting an application that meets the requirements described above and a nonrefundable renewal fee of $350 for each location of an office to be maintained by the mortgage banker.

The Superintendent is authorized to issue a notice to revoke or suspend a letter of exemption if the Superintendent finds that the letter was obtained through a false or fraudulent representation of a material fact, or the omission of a material fact, required by law, or that a condition for exemption is no longer being met.  Prior to issuing an order of revocation or suspension, the mortgage banker must be given an opportunity for a hearing in accordance with R.C. Chapter 119.

All information obtained by the Division pursuant to an examination or investigation is subject to the confidentiality requirements set forth in the Mortgage Brokers Law.  All money collected is to be deposited into the state treasury to the credit of the existing Consumer Finance Fund.

Credit union service organization exemption requirements

(R.C. 1322.01(G)(2)(j) and 1322.023)

Credit union service organizations seeking exemption from registration under the Mortgage Brokers Law are generally subject to the same procedures, requirements, and conditions described above for mortgage bankers.

Transition to the new requirements

(Section 745.60)

These provisions of the act apply on and after January 1, 2010.  The Division of Financial Institutions is required to begin accepting applications for an exemption from registration under the Mortgage Brokers Law on the act's effective date.  Individuals holding a valid mortgage broker certificate of registration as of January 1, 2010, are not required to be in compliance with the act's requirements until the first renewal of their certificate after that date.

Assessments for video service authorizations

(R.C. 1332.24 and 1332.25)

The Video Service Authorization Act passed in the 127th General Assembly provides for a state franchising system for video programming over wires or cables located in public rights-of-way.  Under that act, local franchising authority is preempted once a local franchise expires or terminates according to its terms or an incumbent provider of video service applies for a state franchise under specified conditions.  The Director of Commerce must grant a state franchise (referred to as a "video service authorization" or "VSA") upon submission of a completed application, which, by statute, can require only (1) identification of the applicant's business location, video service area, and video service technologies, (2) the making of certain attestations by the applicant, and (3) the provision of a description of the applicant's customer complaint handling process.  The Director has the authority to investigate any alleged violation of a prohibition against subscriber group race and income discrimination or any alleged failure by a video service provider to (1) operate with proper authorization, (2) assist municipalities and townships in addressing consumer complaints, (3) meet customer service standards, (4) provide certain notices, filings, reports, and emergency announcements, (5) comply with PEG (public, educational, and governmental) channel requirements, and (6) comply with the service commitment applicable to telecommunications facilities-based franchisees.

The act adds to the application fee and civil penalty funding sources for the Department of Commerce's VSA functions authority for the Director to impose an annual, proportional assessment.  Unlike for those other revenue sources, the assessment revenue must be deposited to the credit of the Department's Division of Administration Fund.  The assessment is to be paid by video service providers.

The total amount assessed in a fiscal year cannot exceed the lesser of $450,000 or, as determined annually by the Director, the Department's actual, current fiscal year administrative costs in carrying out its VSA duties.  The Director must allocate that total amount proportionately among the providers to be assessed, using a formula based on subscriber counts as of December 31 of the preceding calendar year.  Providers must submit those counts by January 31 of each year.  The counts must be sent via a notarized statement signed by an authorized officer.  Any information submitted to the Director for purposes of determining subscriber counts must be considered trade secret information, must not be disclosed except by court order, and does not constitute a public record under the Public Records Act.

On or about June 1 of each year, the Director must send to each video service provider to be assessed a written notice of its proportional amount of the total assessment.  The provider must pay the assessment on a quarterly basis not later than 45 days after the calendar quarter ends.  After the initial assessment, the Director annually must reconcile the amount collected with the total, current amount assessed, and then either must charge each video service provider its respective proportion of any insufficiency or proportionately credit each provider's next assessment for any excess collected.

A video service provider may identify or refer to the assessment on a subscriber bill only if the provider opts to pass the cost of the assessment onto its subscribers.

The act expands the Department of Commerce's enforcement authority by authorizing the Director to enforce the assessment provisions in the same manner as other provisions of the VSA law.

Division of Securities

Securities license and filing fee increases

(R.C. 1707.17)

The act increases certain license, annual renewal, and filing fees for securities dealers, securities salespersons, and investment advisers.  The fees are increased as follows:

(1)  Securities dealer license and annual renewal fee--from $100 to $200.

(2)  Securities salesperson license and annual renewal fee--from $50 to $60.

(3)  Investment adviser's license and annual renewal fee--from $50 to $100.

(4)  Investment adviser's notice filing fee--from $50 to $100.

Fees associated with the transfer of a securities dealer or investment adviser license

(R.C. 1707.18)

Under continuing law, if a partnership licensed as a dealer or an investment adviser under the Securities Law (R.C. Chapter 1707.) is terminated due to the death, resignation, withdrawal, or addition of a general partner, or under the laws of the state where the partnership is organized, the license of the partnership and the licenses of its salespersons or investment adviser representatives, as applicable, may be transferred to the successor partnership if the Division of Securities finds that the successor partnership is substantially similar to its predecessor.  The fee for the transfer of the partnership's license is $50.  Under former law, the fee for the transfer of every salesperson's or investment adviser representative's license was $10.  The act increases that $10 fee to $15.

Similarly, under continuing law, if a licensed dealer or licensed investment adviser changes its business form, reincorporates, or by merger or otherwise becomes a different person, the license of the dealer or investment adviser and the licenses of its salespersons or investment adviser representatives, as applicable, may be transferred to the successor entity if the Division finds that the successor entity is substantially similar to its predecessor.  The fee for the transfer of the dealer license or investment adviser license is $50.  The act increases the fee for the transfer of every salesperson's or investment adviser representative's license from $10 to $15.

Investor Education and Enforcement Expense Fund

(R.C. 1707.37)

The act creates in the state treasury the Division of Securities Investor Education and Enforcement Expense Fund, which is to consist of all money received in settlement of any violation of the Securities Law (R.C. Chapter 1707.) and any cash transfers.  Money in the fund is to be used to pay expenses of the Division of Securities relating to education or enforcement for the protection of securities investors and the public.  The act authorizes the Division to adopt rules that establish what qualifies as such an expense.

State Fire Marshal's Fund

(R.C. 3737.71)

Generally, under continuing law, money in the State Fire Marshal's Fund must be used to maintain and administer the Office of the Fire Marshall and the Ohio Fire Academy.  Under former law, the Director of Commerce--upon certifying to the Director of Budget and Management that the cash balance in the fund exceeded the amount needed to pay ongoing operating expenses--was authorized to use the excess for certain real property and facilities expenses of the State Fire Marshal and the Ohio Fire Academy.

The act provides that the Director of Commerce may use the excess in the fund for the real property and facilities expenses described above the approval of the Director of Budget and Management.  Furthermore the act allows the Director of Budget and Management, at any time and upon determining that the money in the State Fire Marshal's Fund exceeds the amount necessary to defray ongoing operating expenses in a fiscal year, to transfer the excess to the General Revenue Fund.

Creation of the Division of Labor

(R.C. 121.04, 121.08, 121.083, 121.084, 124.11, 3301.55, 3703.01, 3703.03 to 3703.08, 3703.10, 3703.21, 3703.99, 3713.01 to 3713.10, 3721.071, 3722.02, 3722.04, 3722.041, 3743.04, 3743.25, 3781.03, 3781.102, 3781.11, 3783.05, 3791.02, 3791.04, 3791.05, 3791.07, 4104.01, 4104.02, 4104.06 to 4104.101, 4104.12, 4104.15 to 4104.19, 4104.21, 4104.33, 4104.42 to 4104.44, 4104.48, 4105.01, 4105.02 to 4105.06, 4105.09, 4105.11 to 4105.13, 4105.15 to 4105.17, 4105.191, 4105.20, 4105.21, 4169.02 to 4169.04, 4171.04, 4740.03, 4740.11, 4740.14, and 5104.051; Section 515.70)

The Division of Labor and Worker Safety and the Division of Industrial Compliance

Under former law, the Division of Labor and Worker Safety and the Division of Industrial Compliance existed as separate divisions within the Department of Commerce and had separate duties as specified in former law.  Former law stated that the Division of Labor and Worker Safety had all powers and performed all duties vested by law in the former Superintendent of Labor and Worker Safety.  Wherever powers were conferred or duties imposed upon the Superintendent of Labor and Worker Safety, those powers and duties were construed as vested in the Division of Labor and Worker Safety.  The Division of Labor and Worker Safety was under the control and supervision of the Director of Commerce and was administered by the Superintendent of Labor and Worker Safety.  The Superintendent of Labor and Worker Safety had to exercise the powers and perform the duties delegated to the Superintendent by the Director under the Minor Labor Law, the Minimum Fair Wage Standards Law, and Wage and Hours on Public Works Law (the Prevailing Wage Law is included in this Law).

Under former law, the Superintendent of Industrial Compliance had to do all of the following:

(1)  Administer and enforce the general laws of Ohio pertaining to buildings, pressure piping, boilers, bedding, upholstered furniture, and stuffed toys, steam engineering, elevators, plumbing, licensed occupations regulated by the Department, and travel agents, as they apply to plans review, inspection, code enforcement, testing, licensing, registration, and certification.

(2)  Collect and collate statistics as are necessary.

(3)  Examine and license persons who desire to act as steam engineers, to operate steam boilers, and to act as inspectors of steam boilers, provide for the scope, conduct, and time of such examinations, provide for, regulate, and enforce the renewal and revocation of such licenses, inspect and examine steam boilers and make, publish, and enforce rules and orders for the construction, installation, inspection, and operation of steam boilers, and do, require, and enforce all things necessary to make such examination, inspection, and requirement efficient.

(4)  Rent and furnish offices as needed in cities in Ohio for the conduct of its affairs.

(5)  Oversee a Chief of Construction and Compliance, a Chief of Operations and Maintenance, a Chief of Licensing and Certification, and other designees appointed by the Director to perform the duties assigned to the Superintendent of Industrial Compliance.

(6)  Enforce the rules the Board of Building Standards adopts establishing requirements for the design, installation, inspection of and design review procedure for nonflammable medical gas, medical oxygen, and medical vacuum piping systems of the Revised Code where a municipal, township, or county building department is not certified to enforce those rules or an employee of a health district where no certified municipal, township, or county building department exists or is not certified to enforce those rules.

(7)  Accept submissions, establish a fee for submissions, and review submissions of certified welding and brazing procedure specifications, procedure qualification records, and performance qualification records for building services piping.

Continuing law requires money collected under specified laws and any other moneys collected by the former Division of Industrial Compliance to be paid into the state treasury to the credit of the former Industrial Compliance Operating Fund, renamed the Labor Operating Fund by the act.  The Department must use the moneys in the Fund for paying the operating expenses of the Division of Industrial Compliance and the administrative assessment required under continuing law.

Division of Labor

The act combines the Division of Labor and Worker Safety and the Division of Industrial Compliance into the Division of Labor in the Department of Commerce, which is led by the Superintendent of Labor.  The act transfers the duties of the Superintendent of Labor and Worker Safety, the Division of Labor and Worker Safety, the Superintendent of Industrial Compliance, and the Division of Industrial Compliance as described under "The Division of Labor and Worker Safety and the Division of Industrial Compliance" above to the Superintendent of Labor and the Division of Labor.  Under the act, the Superintendent of Labor must oversee a Chief of Worker Protection, who is in the unclassified civil service, in addition to the other chiefs whose oversight is transferred to the Superintendent of Labor under the act.  The act also renames the Industrial Compliance Operating Fund the Labor Operating Fund.

The act abolishes the Division of Labor and Worker Safety and the Division of Industrial Compliance in the Department of Commerce on the effective date of this provision.  The act states that the Division of Labor supersedes the Division of Labor and Worker Safety and Division of Industrial Compliance, and that the Superintendent of Labor supersedes the Superintendent of Labor and Worker Safety and the Superintendent of Industrial Compliance.  Under the act, the Superintendent of Labor or Division of Labor, as applicable, must succeed to and have and perform all the duties, powers, and obligations pertaining to the duties, powers, and obligations of the Superintendent and Division of Labor and Worker Safety and the Superintendent and Division of Industrial Compliance.  For the purpose of the institution, conduct, and completion of matters relating to its succession, the act deems the Superintendent of Labor or the Division of Labor, as applicable, as the continuation of and successor under law to the Superintendent and Division of Labor and Worker Safety or the Superintendent and Division of Industrial Compliance, as applicable.  All rules, actions, determinations, commitments, resolutions, decisions, and agreements pertaining to those duties, powers, obligations, functions, and rights in force or in effect on this provision's effective date must continue in force and effect subject to any further lawful action thereon by the Superintendent or Division of Labor.  Wherever the Superintendent of Labor and Worker Safety, Division of Labor and Worker Safety, Superintendent of Industrial Compliance, or Division of Industrial Compliance are referred to in any provision of law, or in any agreement or document that pertains to those duties, powers, obligations, functions, and rights, the reference is to the Superintendent of Labor or Division of Labor, as appropriate.

Under the act, all authorized obligations and supplements thereto of the Superintendent and Division of Labor and Worker Safety and the Superintendent and Division of Industrial Compliance pertaining to the duties, powers, and obligations transferred are binding on the Superintendent or Division of Labor, as applicable, and nothing in the act impairs the obligations or rights thereunder or under any contract.  The abolition of the Division of Labor and Worker Safety and the Division of Industrial Compliance and the transfer of the duties, powers, and obligations of the Superintendent and Division of Labor and Worker Safety and the Superintendent and Division of Industrial Compliance do not affect the validity of agreements or obligations made by those superintendents or divisions pursuant to the State Departments Law, the Plumbing Law, the Building Standards – General Provisions Law, the Building Standards – Offenses and Penalties Law, the Boiler Law, the Elevator Law, and the Construction Industry Licensing Board Law (R.C. Chapters 121., 3703., 3781., 3791., 4104., 4105., and 4740., respectively), or any other provisions of law.

Under the act, in connection with the transfer of duties, powers, obligations, functions, and rights and abolition of the Division of Labor and Worker Safety and the Division of Industrial Compliance, all real property and interest therein, documents, books, money, papers, records, machinery, furnishings, office equipment, furniture, and all other property over which the Superintendent and Division of Labor and Worker Safety or the Superintendent and Division of Industrial Compliance had control pertaining to the duties, powers, and obligations transferred and the rights of the Superintendent and Division of Labor and Worker Safety and the Superintendent and Division of Industrial Compliance to enforce or receive any of the aforesaid is automatically transferred to the Superintendent and Division of Labor without necessity for further action on the part of the Superintendent, Division of Labor, or the Director of Commerce.  Additionally, under the act, all appropriations or reappropriations made to the Superintendent and Division of Labor and Worker Safety and the Superintendent and Division of Industrial Compliance for the purposes of the performance of their duties, powers, and obligations, are transferred to the Superintendent and Division of Labor to the extent of the remaining unexpended or unencumbered balance thereof, whether allocated or unallocated, and whether obligated or unobligated.

Increase in fees for boiler inspections and related occupational licenses

(R.C. 4104.07, 4104.101, and 4104.18)

Generally, all boilers must be inspected when installed and cannot be put into operation until an appropriate certificate of operation has been issued by the Superintendent of Labor (renamed from the Superintendent of Industrial Compliance under former law).  The certificate of operation cannot be issued for any boiler that has not been thoroughly inspected during construction and upon completion, by either a general or special inspector, and that does not conform in every detail with the rules adopted by the Board of Building Standards and unless, upon completion, the boiler is distinctly stamped under the rules adopted by the inspector.  A general or special inspector must possess a certificate of competency issued by the Superintendent to inspect boilers.  To receive that certificate, an applicant must pass an examination, the fee for which formerly was $50.  The act increases this fee to $150.

A person must obtain a license as a low pressure boiler operator, a high pressure boiler operator, or a stationary steam engineer, or to work directly under one of these types of licensees, to operate specified types of boilers and steam engines.  To obtain a license, an applicant must satisfy requirements specified in continuing law and pay a license application fee.  The application fee for applicants for steam engineer, high pressure boiler operator, or low pressure boiler operator licenses formerly was $50.  The license fee for each original or renewal steam engineer, high pressure boiler operator, or low pressure boiler operator license formerly was $35.  The act increases these fees to $75 and $50, respectively.

A person is prohibited from making any installation or major repair or modification of any boiler without first obtaining a permit to do so from the Division of Labor (renamed from the Division of Industrial Compliance under former law).  The application permit fee formerly was $50.  The act increases the permit application fee to $100.

The owner of a boiler that is required to be inspected upon installation, and the owner of a boiler that is issued a certificate of inspection, which is later replaced with a certificate of operation, must pay a fee to the Superintendent of Labor for inspections required upon installation of a boiler and to maintain a certificate of operation.  The act increases those fees as follows:

Boilers subject to annual inspection:                 $45 to $50

Boilers subject to biennial inspection:               $90 to $100

Boilers subject to triennial inspection:              $135 to $150

Boilers subject to quinquennial inspection:     $225 to $250

Prior law required a renewal fee of $45 be paid to the Treasurer of State before the renewal of any certificate of operation for a boiler.  The act eliminates this fee.

Changes to the fees charged for elevator inspections

(R.C. 4105.17)

Generally, an elevator must be inspected prior to its operation.  General or special inspectors conduct these inspections.  Every inspector must forward to the Superintendent of Labor (renamed from the Superintendent of Industrial Compliance under former law) a full and complete report of each inspection made of any elevator and, on the day the inspection is completed, must leave a copy of the report with the owner or operator of the elevator, or the owner's or operator's agent or representative.  The report must indicate the exact condition of the elevator and list any and all of the provisions of the Elevator Law (R.C. Chapter 4105.) and any rules adopted pursuant thereto, with which the elevator does not comply.  Before attempting to enforce, by any remedy, civil or criminal, the provisions with which the inspected elevator does not comply, the Chief (actually the Superintendent) must issue an adjudication order within the meaning of the Administrative Procedure Act.

Ongoing law sets forth a fee for each inspection of an elevator required to be inspected under the Elevator Law, or attempted inspection that, due to no fault of a general inspector or the Division of Labor (renamed from the Division of Industrial Compliance under former law), is not successfully completed by a general inspector conducted at any of the following times:

(1)  Before the operation of a permanent new elevator prior to the issuance of a certificate of operation;

(2)  Before the operation of an elevator being put back into service after a repair;

(3)  As a result of a general inspector, rather than a special inspector, conducting the inspection.

In addition to the circumstances described in (1) to (3) immediately above, the act requires a fee to be paid for the inspection or attempted inspection by a general inspector before the operation of an elevator after an adjudication order issued under the Elevator Act.  The act increases the base fee for an inspection conducted at any of the times described above from $20 to $120 (plus $10 for each floor where the elevator stops).

The Superintendent may assess an additional fee for the reinspection of an elevator when a previous attempt to inspect that elevator has been unsuccessful through no fault of a general inspector or the Division.  Under former law, the additional fee was $125 plus $5 for each floor where an elevator stops.  The act decreases the base fee for reinspection from $125 to $120, but increases the per floor reinspection fee from $5 to $10.

Under former law the fee for issuing or renewing a certificate of operation under the Elevator Law for an elevator that is inspected every six months was $200 plus $10 for each floor where the elevator stops, except where the elevator has been inspected by a special inspector.  The act increases this base fee to $220 and increases the per floor fee to $12 per floor.

The Real Estate Brokers Law

Licensing--fees

(R.C. 4735.06, 4735.09, 4735.13, and 4735.15)

The act increases the following fees:

·         The fee for an application for a real estate broker's license, and for each successive application, from $69 to $100.

·         The fee for an application for a real estate salesperson's license, and for each successive application, from $49 to $60.

·         The fee for reactivation or transfer of a license by a real estate salesperson from $20 to $25.

·         The fee for a branch office license from $8 to $15 for each year of the licensing period.

·         The fee for a renewal real estate broker's license from $49 to $60 for each year of the licensing period.

·         The fee for the renewal of a real estate salesperson's license from $39 to $45 for each year of the licensing period.

The act makes the fees for branch office licenses, license renewals, late filings, and foreign real estate dealer and salesperson licenses nonrefundable.

The act reduces the amount of the application fee for a real estate broker's license, the application fee for a real estate salesperson's license, the application fee for a real estate broker to associate with another broker in the capacity of a real estate salesperson, the fee that accompanies a notice of a real estate broker who intends to become a member or officer of an entity that is or intends to become a licensed real estate broker that must be credited to the Real Estate Education and Research Fund from $4 to $1.  The act reduces the amount of the fee for the reactivation or transfer of a license, and the fee for a branch office license, license renewal, late filing, and foreign real estate dealer and salesperson license that must be credited to the Real Estate Education and Research Fund from $4 to $1 for yearly fees, and from $12 to $3 for each triennial fee.

Real Estate Recovery Fund

(R.C. 4735.12)

The Ohio Real Estate Commission must impose a special assessment of up to $10 on each licensed real estate broker, brokerage, or salesperson who files a notice of license renewal if the amount available in the Real Estate Recovery Fund is less than $1 million on the first day of July preceding the renewal filing.  The act lowers that threshold amount to $500,000.

Under law largely retained by the act, any person who obtains a final judgment in any court of competent jurisdiction against any broker or salesperson licensed under the Real Estate Brokers Law, on the grounds of conduct that is in violation of the Real Estate Brokers Law or the rules adopted under it, and that is associated with an act or transaction that only a licensed real estate broker or licensed real estate salesperson is authorized to perform, may file a verified application in any court of common pleas for an order directing payment out of the Real Estate Recovery Fund of the portion of the judgment that remains unpaid and that represents the actual and direct loss sustained by the applicant.  The act requires the application to be filed only in the Court of Common Pleas of Franklin County instead of in any court of common pleas.

Real Estate Appraiser Law

(R.C. 4763.01, 4763.03, 4763.04, 4763.05, 4763.06, 4763.07, 4763.09, and 4763.11)

The Ohio Real Estate Appraiser Law, Chapter 4763. of the Revised Code, establishes the licensing and certification requirements for certified general, certified residential, and state licensed real estate appraisers, and registered real estate appraiser assistants.  Ohio law does not require that appraisers be licensed or certified but an appraiser who so elects must adhere to the law's requirements and is subject to disciplinary actions for violations.

The Real Estate Appraiser Board in the Division of Real Estate and Professional Licensing, Department of Commerce, adopts rules that govern the licensing, certification, and registration requirements for appraisers.  Prior law directed the Board to periodically review the standards for the preparation and reporting of real estate appraisals, while the act directs the Board to review standards for the development and reporting of appraisal reports.  This expansion of the actions over which the Board has responsibility is reflected in the definitions of "appraisal report" and "report" which, under the act, include, in addition "appraisal review" and "appraisal consulting service."  "Appraisal review" means the act or process of developing and communicating an opinion about the quality of another appraiser's work that was performed as part of an appraisal, appraisal review, or appraisal consulting assignment.  "Appraisal consulting" means the act or process of developing an analysis, recommendation, or opinion to solve a problem related to real estate.

Former law required the Board to appoint a referee or examiner for any proceeding that involves the revocation or suspension of a certificate, registration, or license.  The act instead characterizes the proceeding as a "disciplinary action of a certificate holder, licensee, or registrant."

The act changes the procedures for serving a subpoena upon a witness to testify in a matter.  Prior law required a sheriff or constable to serve and return the process.  The act enables the service to be made "by constable or by certified mail, return receipt requested."  The act also deems the subpoena to have been served on the date delivery is made, or the date the person refuses to accept delivery while prior law was silent on this matter.

An applicant for a license, registration, or certificate was required under former law to submit a fingerprint with the other application materials.  The act eliminates this requirement.

The act increases the initial fee for certification and licensure from a maximum of $125 to $175 and increases the fee for a registered  appraiser assistant from $50 to $100.

Continuing law retained in part by the act requires every state-certified general real estate appraiser, state-certified residential real estate appraiser, state-licensed residential real estate appraiser, and state-registered real estate appraiser assistant to submit proof of successfully completing a minimum of 14 classroom hours of continuing education instruction in courses or seminars approved by the Board.  Additionally, the certificate holder and licensee must have satisfied the 14-hour continuing education requirements within the one-year period immediately following the issuance of the initial certificate or license and must satisfy those requirements annually thereafter.  Under former law, if the certificate holder or licensee failed to submit proof to the Superintendent of Real Estate and Professional Licensing of meeting these requirements, the certificate holder's, registrant's, or licensee's certificate or license automatically was suspended.  The Superintendent had to notify the certificate holder or licensee of the suspension and if the certificate holder or licensee failed to submit proof to the Superintendent of meeting those requirements within three months from the date of suspension, the Superintendent had to revoke the certificate or license.  If a certificate holder or licensee whose certificate or license was revoked desired to be certified or licensed under the Real Estate Appraisers Law the certificate holder or licensee had to apply for an initial certificate or license.

The act removes the automatic suspension and revocation procedures described immediately above and instead states that the individual is ineligible for a renewal certificate or license and requires the individual to satisfy all of the requirements specified under continuing law for the issuance of a certificate or license in order to regain a certificate or license registration, except that the certificate holder or licensee may submit proof to the Superintendent of meeting these requirements within three months after the date of expiration of the certificate or license registration, or by obtaining a medical exception, without having to comply with the initial licensure or certification requirements.  Under the act, a certificate holder or licensee registrant may not engage in any activities permitted by the certificate or license during the three-month period following the certificate's or license's normal expiration date or during the time period for which a medical exception applies.  The act also applies these provisions to registrants.

An applicant to become a registered real estate appraiser assistant must submit proof of meeting the same continuing education requirements as required for appraisers as described above.  The act eliminates this as an initial requirement for assistants, specifying that an assistant who remains in this classification for more than two years must satisfy this requirement only in the third and successive years in that status.

A real estate appraiser who fails to timely renew the appraiser's certificate, registration, or license is entitled to a three-month grace period.  If the real estate appraiser does not complete the renewal within that time, it becomes necessary for the appraiser to re-take the real estate appraiser examination.  The act retains the three-month grace period and, in the alternative, allows a real estate appraiser to avoid re-taking the examination by obtaining a medical exception, applying for renewal, and paying the renewal and late filing fees.

Under prior law, during the grace period, a real estate appraiser was permitted to continue engaging in real estate appraisal activities.  The act prohibits a real estate appraiser from doing so during the grace period or during the time period for which a medical exception applies--and in any event, until the renewal and late filing fees have been paid.

The act authorizes the Superintendent to grant a medical exception to a real estate appraiser.  To receive a medical exception, the appraiser must submit a request to the Superintendent together with satisfactory proof that a medical exception is warranted.  If the Superintendent determines that satisfactory proof has not been presented, the appraiser, within 15 days after the determination, may request the Real Estate Appraiser Board to review the determination.  The Board may adopt reasonable rules under the Administrative Procedure Act to implement the medical exception provisions of the act.

Continuing law enables a person to file a complaint against a licensed, registered, or certified appraiser with the Superintendent of Real Estate.  The act modifies some of the procedures related to filing and investigating complaints.  In general, the act eliminates or increases the time specified for various steps in the procedure.  It also permits the "informal meeting" to be conducted as an "informal mediation meeting."  If a formal hearing is held concerning the complaint, the act requires the hearing examiner to file a report of findings with the Superintendent and other specified persons and allows the subject of the complaint to file a written objection to the hearing examiner's report.  The act requires the Board to consider any objections before approving, modifying, or rejecting the examiner's report.

Under continuing law, the Board is allowed to take any disciplinary action the Board considers appropriate after considering a referee's or hearing examiner's report.  Continuing law lists actions the Board could take following a disciplinary hearing.  The act adds to that list the following options:  (1) the imposition of a fine not exceeding $2,500 per violation and (2) a requirement that the appraiser complete additional education courses, which do not count toward continuing requirements or pre-license or pre-certification requirements.  The act deletes from that same list of approved actions a suspension of the certificate, registration, or license until the person meets a requirement the board specifies.

The Board is authorized under continuing law to take disciplinary action for specified violations of the law.  The act adds the following to the specified violations:  (1) the failure to provide copies of records to the Superintendent and (2) a failure to provide notice of a felony or crime of moral turpitude that the act requires.  To the records a real estate appraiser is required to maintain, the act adds work file documentation.  "Work file" means documentation used during the preparation of an appraisal report or necessary to support an appraiser's analyses, opinions, or conclusions.  Additionally, with regard to (1) immediately above, that act states that failure to comply with a subpoena is prima facie evidence of violating the prohibition described in (1) above.

The act expands the following continuing law prohibitions:

·         Violation of any of the standards for the development or communication of an appraisal report set forth in the Real Estate Appraiser Law and rules of the Board to include violating the standards for preparing and reporting those reports;

·         Negligence or incompetence in developing an appraisal, preparing, or communicating an appraisal report, to include reporting an appraisal report.

Under continuing law a real estate appraiser is required to notify the Real Estate Appraisers Board of a criminal conviction of a felony or a crime of moral turpitude within 15 days after conviction.  The act retains this requirement and also requires a real estate appraiser to notify the Board, within 15 days after an agency's issuance of an order revoking or permanently surrendering any professional license, certificate, or registration by any public entity other than the Division of Real Estate.

The act specifies that all notices, written reports, and determinations are to be mailed by certified mail, return receipt requested.  If the certified mail notice is returned because of failure of delivery or was unclaimed, the notice, written report, or determination is deemed to have been served if the Superintendent then sends the notice, written report, or determination by regular mail and obtains a certificate of mailing.  Refusal of delivery of personal service or mail is not considered to be failure of delivery and service is deemed to have been completed.

Continuing law states that nothing in the Real Estate Appraisers Law precludes a partnership, corporation, or association which employs or retains the services of a certificate holder or licensee to advertise that the partnership, corporation, or association offers state-certified or state-licensed appraisals through a certificate holder or licensee if the advertisement clearly states such fact in accordance with guidelines for such advertisements established by the Board's rule.  The act expands this provision to include that a partnership, corporation, or association may engage a licensee or certificate holder and advertise in such a manner.  Similarly, under continuing law, every partnership, corporation, or association that employs or retains the services of a person licensed, registered, or certified under the Real Estate Appraisers Law, whether the certificate holder, registrant, or licensee is an independent contractor or under the supervision or control of the partnership, corporation, or association, is jointly and severally liable for any damages incurred by any person as a result of an act or omission concerning a state-certified or state-licensed real estate appraisal prepared or facilitated in the preparation by a certificate holder, registrant, or licensee while employed or retained by the partnership, corporation, or association.  The act expands this provision to include that the partnership, corporation, or association is jointly and severally liable for any certificate holder, registrant, or licensee the partnership, corporation, or association engages.

 

·         Makes changes to the requirements for restoring a license issued by the State Board of Cosmetology.

·         Increases the fines that the Board may impose for specified offenses including failure to comply with Ohio's law regulating cosmetology.

·         Increases from eight to ten the number of daily hours of instruction the Board may consider in determining an applicant's total hours of instruction for licensing purposes.

 

 

Restoration of expired license

(R.C. 4713.63)

Under continuing Cosmetology Licensing Law, a practicing license, managing license, or instructor license expires if it has not been renewed for any reason other than because it has been revoked, suspended, or classified inactive, or because the license holder has been given a waiver or extension.  Law retained in part by the act allows an expired license to be restored if the person who held the license pays the restoration fee and all lapsed renewal fees and submits proof that the person has completed all applicable continuing education requirements.  Additionally, former law required applicants for a practicing or managing license renewal to retake the licensing examination test if the license had been expired for more than two years.

The act requires the person renewing a license to pay the renewal fee for the current renewal period and any applicable late fees and specifies that those fees in addition to the continuing law's restoration fee, must be paid to the State Board of Cosmetology.  The act also specifies that the required lapsed renewal fee is $45 per license renewal period[77] that has elapsed since the license was last issued or renewed.  Under the act, the lapsed renewal fee must be deposited into the General Revenue Fund.

The act removes the requirement that all applicants for license renewal of an expired license complete continuation education requirements.[78]  However, the act replaces the former requirement that applicants for practicing or managing licenses that have been expired for more than two years retake and pass the licensing examination with a requirement that those applicants complete continuing education requirements.  Under the act, they must complete eight hours of continuing education for each license renewal period that has elapsed since the license was last issued or renewed, up to a maximum of 24 hours.  At least four of those hours must include a course pertaining to sanitation and safety methods.

Fines

(R.C. 4713.64)

Under continuing law, the State Board of Cosmetology may impose a fine for any of the following:  (1) failure to comply with the requirements of Ohio's law regulating cosmetology and any rules adopted under it, (2) continued practice by a person knowingly having an infectious or contagious disease, (3) habitual drunkenness or addiction to any habit-forming drug, (4) willful false and fraudulent or deceptive advertising, (5) falsification of any record or application required to be filed with the Board, or (6) failure to pay a fine or abide by a suspension order issued by the Board.

The act increases the fines set forth in former law that the Board may impose from not more than $100 to not more than $500 for a first offense, from not more than $500 to not more than $1,000 for a second offense, and from not more than $1,000 to not more than $1,500 for a third and any additional offenses.

Cosmetology licensing

(R.C. 4713.32)

Under continuing law, applicants seeking a practicing license, managing license, or instructor license from the State Board of Cosmetology are required to successfully complete a specified amount of hours of instruction.  The number of hours required varies depending on the type of license sought and the practice area (e.g., cosmetology, esthetics, hair design, manicuring, or hair styling).  (R.C. 4713.28, 4713.30, and 4713.31.)  Under former law, the Board could only count eight hours of instruction per day toward the total number of hours when determining whether an applicant has accumulated the requisite hours of instruction.  Any instruction in excess of eight hours in a single day could not be counted.

The act increases from eight to ten the daily number of hours of instruction that the Board may consider in calculating an applicant's total hours of instruction required for licensure.

 

·         Requires the Counselor, Social Worker, and Marriage and Family Therapist Board to establish fees for all of the following:  (1) verification, to another jurisdiction, of a license or registration the Board has issued, (2) continuing education programs offered by the Board to licensees or registrants, and (3) late renewal of licenses or certificates of registration.

·         Permits the appropriate professional standards committee of the Board to impose a fine for any disciplinary violation consistent with a graduated system of fines to be established by the Board in rules.

 

 

New fees

(R.C. 4757.31)

Under continuing law, the Counselor, Social Worker, and Marriage and Family Therapist Board is required to establish, and from time to time may adjust, fees for licensure and renewal of licensure for all of the following:  professional clinical counselors, professional counselors, independent social workers, social workers, independent marriage and family therapists, and marriage and family therapists.  Similarly, the Board is required to establish, and from time to time may adjust, fees for registration and renewal of registration of social work assistants.

The act requires the Board to establish fees for all of the following:  (1) verification, to another jurisdiction, of a license or registration the Board has issued, (2) continuing education programs offered by the Board to licensees or registrants, and (3) late renewal of licenses or certificates of registration.  The Board is permitted to adjust the fees from time to time.

Authority to fine

(R.C. 4757.10 and 4757.36)

Law unchanged by the act authorizes the professional standards committees of the Counselor, Social Worker, and Marriage and Family Therapist Board, in accordance with the Administrative Procedure Act (R.C. Chapter 119.), to take disciplinary action against an individual who has applied for or holds a license or certificate of registration issued by the Board for any of a number of reasons specified in statute.  The Board may refuse to issue a license or certificate of registration; suspend, revoke, or otherwise restrict a license or certificate of registration; or reprimand a person holding a license or certificate of registration.

In addition to the disciplinary actions described above, the act authorizes the appropriate professional standards committee of the Board to impose a fine for any disciplinary violation.  The fine is to be consistent with a graduated system of fines established by the Board in rules that the act requires the Board to adopt.  The system of fines must be based on the scope and severity of violations and the history of compliance, not to exceed $500 per incident.  The act requires the Attorney General, on request of the Board, to bring and prosecute to judgment a civil action to collect any fine imposed by a professional standards committee that remains unpaid.  All fines must be deposited in the Occupational Licensing and Regulatory Fund.

 

·         Expands the "Appalachian region" represented by the Governor's Office of Appalachian Ohio to include Ashtabula, Mahoning, and Trumbull counties, thereby making those counties eligible for funds from the federal Appalachian Regional Commission.

·         Prevents appropriated state funds allocated to pay administrative costs of existing local development districts from being reduced due to the creation of additional development districts and ensures that such allocated funds are increased to match federal Consumer Price Index increases.

·         Permits the Director of Development to provide export promotion assistance to Ohio businesses and to organize or support missions to foreign countries to promote the export of Ohio products and services and to encourage direct foreign investment in Ohio.

·         Permits the Director to charge fees to businesses receiving export assistance and to participants in foreign missions to recover the direct cost of those activities, and requires those fees to be deposited into the International Trade Cooperative Projects Fund.

·         Authorizes the Director to make grants of up to $500,000 from the General Revenue Fund to local governments hosting major sporting events, up to a total of $1 million annually, if estimates of the associated state sales tax increase is at least $250,000.

·         Increases from 10 to 11 the number of members on the Development Financing Advisory Council.

·         Requires a financial institution to indicate in its certification for each capital access loan made by the financial institution whether the business receiving the loan is a minority business enterprise.

·         Requires the Director, upon receipt of a certification indicating that a capital access loan was made to a minority business enterprise, to disburse to the financial institution 80% of the principal amount of the loan from the Capital Access Loan Program Fund, instead of the percentages disbursed for other capital access loans.

·         Removes a provision that requires the rules regarding the establishment of procedures for minority businesses applying for surety bonds to provide that a minority business submit documentation, as the Director requires, to demonstrate either that the minority business has been denied a bond by two surety companies or that the minority business has applied to two surety companies for a bond and, at the expiration of 60 days after making the application, has neither received nor been denied a bond.

·         Makes a community development corporation eligible for loans under the minority business enterprise loan program if the corporation predominantly benefits minority business enterprises or is located in a census tract that has a population that is 60% or more minority.

·         Provides that any amounts received by the state as part of the federal Build America Bond program are not to be included when determining the annual $63 million debt service limit on the repayment of certain obligations with profits from the sale of spirituous liquor.

·         Creates a micro-lending program within the Department of Development's R.C. Chapter 166. Direct Loan programs specifically for small business enterprises (PARTIALLY VETOED).

·         Creates the Rapid Outreach Loan Fund to be used for making loans, including forgivable loans, and grants for research and development projects and logistics and distribution infrastructure projects.

·         Authorizes proceeds from the issuance of Chapter 166. bonds to be used for making loans and grants from the Rapid Outreach Loan Fund.

·         Creates the Logistics and Distribution Infrastructure Taxable Bond Fund in the state treasury, and provides that the Fund must be used for allowable costs of eligible logistics and distribution projects.

·         Authorizes the Director to develop a program to encourage employers to hire individuals from significantly disadvantaged groups including, but not limited to, individuals who have not graduated from high school, have been convicted of a felony, are disabled, or are chronically unemployed.

·         Removes the 6% restriction on the portion of the Low- and Moderate-Income Housing Trust Fund that may be used for permanent and transitional housing and services for the homeless.

·         Increases the portion of the Housing Trust Fund that may be used for homeless shelters from 7% to 10%; includes unaccompanied youth shelters as a permissible expenditure in this category.

·         Expands the activities that may be funded by the  Low- and Moderate- Income housing Trust Fund to include tenant education, tenant organizations, promoting positive interactions with landlords, and initiatives related to creating county trust funds.

·         Changes the composition of the Ohio Venture Capital Authority by reducing its membership from nine to three members, who would be appointed by the Governor, one of whom from persons nominated by the President of the Senate and one of whom from persons nominated by the Speaker of the House.

·         Authorizes port authorities to issue revenue securities to raise funds to invest in Third Frontier research and development projects through the Ohio Venture Capital Authority.

·         Authorizes tax credits for the port authority's bond trustee to cover losses on those investments, to be applied "for the benefit of" the port authority.

·         Requires, as a condition of investment of Ohio Venture Capital Authority money in a venture capital fund, that the total amount of OVCA money committed to Ohio-based businesses by all venture funds is at least equal to the total amount of OVCA funds committed to all venture funds receiving OVCA money.

·         Limits total OVCA tax credit authorizations to $380 million.

·         Temporarily authorizes the Director to seek and use available federal economic stimulus funds to secure and guarantee loans made for historic rehabilitation projects that are approved for an Ohio historic rehabilitation tax credit.

·         Includes compressed air in the definition of alternative fuel for the purpose of making alternative fuel transportation grants to businesses, nonprofit organizations, public schools, and local governments for the purpose of increasing the availability and use of alternative fuels.

·         Includes compressed air in the definition of alternative fuel for the purpose of requiring all new motor vehicles acquired by the state for use by state agencies be capable of using alternative fuel.

·         Authorizes the Department to make allocations and reallocations with respect to the national recovery zone economic development bond limitation and the national recovery zone facility bond limitation.

 

 

Expansion of "Appalachian region"

(R.C. 107.21)

The Governor's Office of Appalachian Ohio in the Department of Development represents the interests of, and maintains local development districts in, counties within the "Appalachian region" for the purpose of planning for the distribution of funds from the federal Appalachian Regional Commission.  The Ohio Appalachian Center for Higher Education also looks out for the Appalachian region--its mission is to increase the educational attainment of the Appalachian region's residents (R.C. 3333.58).

The act adds Ashtabula, Mahoning, and Trumbull counties to the Appalachian region, thereby making those counties eligible for federal funds from the Appalachian Regional Commission, and adding their residents' educational attainment to the purview of the Ohio Appalachian Center for Higher Education.

Local development districts

(R.C. 107.21)

Under continuing law, local development districts in the Appalachian region are responsible for the regional planning for the distribution of funds received from the Appalachian Regional Commission within the region.

The act provides that the amount of money from appropriated state funds allocated each year to pay administrative costs of existing local development districts cannot be decreased due to the creation and funding of additional local development districts.  The act also ensures that the amount of such allocated funds must be increased each year by the average percentage of increase in the federal Consumer Price Index (all urban consumers, U.S. city average, all items) for the prior year.

Export promotion assistance and foreign investment

(R.C. 122.05 and 122.051)

Under continuing law, the Director of Development is permitted to engage in various activities to encourage, promote, and assist trade and commerce between Ohio and foreign nations, including establishing offices in foreign countries and entering into contracts with foreign nationals.  The act expands this authority by permitting the Director to provide export promotion assistance to Ohio businesses and to organize or support missions to foreign countries to promote export of Ohio products and services and to encourage foreign direct investment in Ohio.

The act authorizes the Director to charge fees to businesses receiving export assistance and to participants in foreign missions that are sufficient to recover the direct costs of those activities.  Fees charged under this provision must be deposited into the International Trade Cooperative Projects Fund.  The Director must adopt, as an internal management rule, a procedure for setting the fees and a schedule of fees for services commonly provided by the Department.  The procedure must require the Director to annually review the established fees.

State subsidy for hosting sports events

(R.C. 122.12 and 122.121)

The act authorizes the Director of Development to make grants of General Revenue Fund money to counties or municipal corporations hosting major sporting events (specified below), beginning July 1, 2011.  The grant amount is to be "based on" the increased state sales tax revenue directly attributable to the preparation for and presentation of the event, as determined by the Director.  Grants are available only if the increased state sales tax revenue is estimated to be greater than $250,000.  No individual grant may exceed $500,000, and the total of all grants in any fiscal year may not exceed $1 million.

The games that qualify for grants are the following:  National Football League "Super Bowl," World Cup soccer matches, NCAA championship game, NCAA football Bowl Championship Series games, all-star games of the National Basketball Association, National Hockey League, or Major League Baseball, the National Senior Games, and the Olympic Games.  In order to apply for a grant, a county or municipal corporation ("endorsing" county or municipality) must contain a site that may be selected as a site for such an event by the corresponding organization ("site selection organization") and must have entered into a "joinder undertaking" with the organization.  A joinder undertaking is a preliminary agreement that the parties will enter into a subsequent "joinder agreement" if the site selection organization selects the county or municipal corporation for the game site.  The joinder agreement sets forth "representations and assurances by the endorsing municipality or endorsing county in connection with" the site selection.  Combinations of counties and municipal corporations may be parties to joinder undertakings and agreements.

To obtain a grant, an endorsing county or municipality must apply to the Director of Development and must certify information to be used by the Director to estimate the increased state sales tax attributable to the game.  The information may include historical attendance and ticket sales for the game, income statements showing revenue and expenditures for the game in prior years, attendance capacity at the proposed venues, event budget at the proposed venues, and projected lodging room nights based on historical attendance, attendance capacity at the proposed venues, and duration of the game and related activities.

In estimating the increased state sales tax revenue attributable to the event, the Director must consider the increase for a two-week period within a "market area," which is a geographic area designated by the Director, in consultation with the Tax Commissioner, where there is "a reasonable likelihood of measurable economic impact directly attributable to the preparation for and presentation of the game and related events, including areas likely to provide venues, accommodations, and services in connection with the game."  The endorsing municipality or endorsing county that has been selected as the site for a game must be included in a market area.  The two-week period ends on the day after the game is held.  The Director's estimate is to be based on the information and the copy of the joinder undertaking provided to the Director by the county or municipal corporation or by a local organizing committee (see below).

If the Director of Development approves an application, and the applicant enters into a joinder agreement, the applicant county or municipality must file a copy of the agreement with the Director.  The Director then must notify the Director of Budget and Management, who must establish a schedule for disbursing the grant from the General Revenue Fund.

The act requires the endorsing county or municipality to report to the Director of Development on the economic impact of the game.  The report must be filed within 60 days after the game, and must include any information the Director requires, including, at least, a final income statement showing total revenue and expenditures and revenue and expenditures in the market area for the game and ticket sales.  On the basis of the report and the "exercise of reasonable judgment," the Director must determine the incremental increase in state sales tax directly attributable to the game.  If the actual incremental increase is less than the estimated increase, the Director is authorized to require the endorsing county or municipality to refund all or a portion of the grant.

The act also requires the endorsing county or municipality or a local organizing committee to provide information required by the Director of Development and Tax Commissioner, including annual audited statements of any financial records required by a site selection organization, and data obtained by the county or municipal corporation or the local organizing committee relating to the game's attendance and economic impact.  The Director and Tax Commissioner also may require them to provide an annual audited financial statement within four months after the closing date of the financial statement.  (A local organizing committee is defined as an organization that an endorsing county or municipal corporation authorizes to pursue and bid on selection of the county or municipal corporation as the site of a game, or that executes an agreement with a site selection organization regarding a bid to host a game.)

The act prohibits disbursement of a grant if the Director of Development determines that the money would be used to solicit the relocation of a professional sports franchise within Ohio.  The act also states that the grant provision does not create or require the state's guarantee of any obligation undertaken by a county or municipal corporation under a "game support contract" (i.e., a joinder undertaking, joinder agreement, or similar agreement) or other agreement related to hosting a game.

Development Financing Advisory Council

(R.C. 122.40)

The Development Financing Advisory Council makes recommendations to the Director of Development and advises the Director regarding various economic development programs, including the purchase and improvement of property for industrial, commercial, distribution, or research facilities and the Capital Access Loan Program.

Under prior law, the Council was comprised of ten members:  seven members appointed by the Governor, one member of the House of Representatives, one member of the Senate, and the Director of Development, or the Director's designee.  The act increases the membership of the Council from 10 to 11, by adding an eighth member appointed by the Governor.

Capital access loans for minority business enterprises

(R.C. 122.603)

The Capital Access Loan Program assists participating financial institutions in making program loans to eligible businesses that face barriers in accessing working capital and in obtaining fixed asset financing.  Under the Program, the Department of Development disburses moneys from the Capital Access Loan Program Fund to a financial institution's program reserve account after the financial institution makes a capital access loan to an eligible business.

When a financial institution makes a capital access loan, the financial institution certifies to the Director of Development that the participating financial institution has made the loan.  The certification includes the loan amount, the amount of fees paid on the loan, the amount of its own funds that the financial institution deposited into its program reserve account to reflect the fees, and other information specified by the Director.  The act requires the certification also to indicate whether the eligible business receiving the capital access loan is a minority business enterprise.

Generally, upon receipt of the first three certifications from a participating financial institution, the Director must disburse to the financial institution, from the Capital Access Loan Program Fund, an amount equal to 50% of the principal amount of the capital access loan for deposit into the financial institution's program reserve account.  Thereafter, upon receipt of a certification from that financial institution, the Director must disburse to the financial institution, from the fund, an amount equal to 10% of the principal amount of the capital access loan.

The act generally retains these provisions but establishes a different disbursement percentage with respect to capital access loans that are made to minority business enterprises.  It requires the Director to disburse 80% of the principal amount of a capital access loan to a financial institution, if the financial institution made the capital access loan to an eligible business that is a minority business enterprise.

Rules for application by minority business for a bond

(R.C. 122.89)

Under continuing law the Director of Development can execute bonds as surety for minority businesses as principals, on contracts with the state, any political subdivision or instrumentality thereof, or any person as the obligee.  The Director, with the advice of the Minority Development Financing Advisory Board, must adopt rules under the Administrative Procedure Act establishing procedures for application for surety bonds by minority businesses and for review and approval of applications.  Prior law required the rules of the Board to provide that a minority business, in order to make an application for a bond to the Director, must submit documentation, as the Director requires, to demonstrate either that the minority business has been denied a bond by two surety companies or that the minority business has applied to two surety companies for a bond and, at the expiration of 60 days after making the application, has neither received nor been denied a bond.  The act removes this requirement.

Community development corporations--Minority Business Enterprise Loan Program

(R.C. 122.71, 122.751, and 122.76)

Under continuing law, the Director of Development, with Controlling Board approval, can lend funds to minority business enterprises and to community improvement corporations, Ohio development corporations, minority contractors business assistance organizations, and minority business supplier development councils for the purpose of loaning funds to minority business enterprises and for the purpose of procuring or improving real or personal property, or both, for the establishment, location, or expansion of industrial, distribution, commercial, or research facilities in Ohio, if the Director determines, in the Director's sole discretion, that all of the following apply:

(1)  The project is economically sound and will benefit the people of Ohio by increasing opportunities for employment, by strengthening the economy of Ohio, or expanding minority business enterprises.

(2)  The proposed minority business enterprise borrower is unable to finance the proposed project through ordinary financial channels at comparable terms.

(3)  The value of the project is or, upon completion, will be at least equal to the total amount of the money expended in the procurement or improvement of the project, and one or more financial institutions or other governmental entities have loaned not less than 30% of that amount.

(4)  The amount to be loaned by the Director will not exceed 60% of the total amount expended in the procurement or improvement of the project.

(5)  The amount to be loaned by the Director will be adequately secured by a first or second mortgage upon the project or by mortgages, leases, liens, assignments, or pledges on or of other property or contracts as the Director requires, and the mortgage will not be subordinate to any other liens or mortgages except the liens securing loans or investments made by the financial institutions referred to above, and the liens securing loans previously made by any financial institution in connection with the procurement or expansion of all or part of a project.

A loan applicant must not be considered until after a certification by the equal employment opportunity coordinator of the Department of Administrative Services that the applicant is a minority business enterprise, or after a certification by the Minority Business Supplier Development Council that the applicant is a minority business, and that the applicant satisfies all criteria regarding eligibility for assistance.

The act expands eligibility for loans under the minority business enterprise loan program to a community development corporation[79] that predominantly benefits minority business enterprises or is located in a census tract that has a population that is 60% or more minority.  The act also specifies that the application of a community development corporation for a loan must not be considered until after a determination that the applicant is indeed a community development corporation.

Disposition of Build American Bond payments related to liquor profit debt service

(R.C. 166.11)

Continuing law prohibits the repayment of certain development and energy-related obligations with profits from the sale of spirituous liquor in excess of $63 million in any fiscal year.  The act provides that amounts received in any fiscal year under the Build America Bond program must not be included when determining the $63 million limit.  The Build America Bond program is a program authorized under the federal American Recovery and Reinvestment Act of 2009 to allow state and local governments to issue taxable bonds in 2009 and 2010 for eligible projects and to receive a payment from the federal government to defray a portion of the borrowing costs (see 26 U.S.C. 6431).

Micro-lending Program (PARTIALLY VETOED)

(R.C. 166.07(C))

Continuing law authorizes the Department of Development to lend money at below-market rates to businesses to assist them in acquiring nonretail facilities and equipment (among other "allowable costs").  Lending is from the Facilities Establishment Fund, which is funded primarily from constitutionally authorized state bond issuances.  Among the criteria for obtaining a loan are the number of jobs to be created or preserved, the payroll, and the state and local taxes generated.  (R.C. 166.05(A)(1)(a) and (b).)  Loans are subject to minimum collateral and equity requirements and minimum ratios of jobs-to-loan amount.  Application fees, processing fees, and servicing fees are charged.

The act requires the Director of Development to make loans (or to arrange for others to make loans) to "small" businesses from any amount designated for that purpose by the General Assembly.  The Director is required to establish eligibility criteria and loan terms that supplement preexisting eligibility criteria and loan terms, and the Director may prescribe reduced fees.  The act directs the Director to give precedence to projects "that foster the development of small entrepreneurial enterprises," notwithstanding the preexisting job creation/retention, payroll, and tax generation considerations to the extent those considerations otherwise may disqualify small businesses' projects from the preexisting loan program.

The Governor vetoed the act's requirement that the loans be made from money the General Assembly designates specifically from the Facilities Establishment Fund.

Rapid outreach loans

(R.C. 166.22)

Under continuing law, obligations may be issued to provide money for economic development under Chapter 166. of the Revised Code.  The proceeds of the issuance may be used for research and development projects and logistics and distribution infrastructure development projects.  The act creates the Rapid Outreach Loan Fund to be used for making loans, including forgivable loans, and grants for such projects.

The act authorizes the Director of Development, with the approval of the Controlling Board, to make loans and grants from the fund for research and development and logistics and distribution infrastructure projects, including discretion to decide whether a loan can be forgiven or must be repaid.  To receive a rapid outreach loan or grant, a project must be economically sound, and the amount of the loan or grant must be reasonable in light of the scope of the project.  The Director is authorized to establish fees, charges, interest rates, times for payment of principal and interest, and other terms and conditions of loans and grants.

The act authorizes the proceeds from the issuance of bonds issued under existing law to be used for making loans from the Rapid Outreach Loan Fund, which will also consist of money appropriated to the fund and transferred to the fund from the Research and Development Loan Fund, the Logistics and Distribution Infrastructure Fund, the repayment of loans and grants, and the recovery of loan guarantees and grants made from the fund.

Logistics and Distribution Infrastructure Taxable Bond Fund

(R.C. 166.08, 166.25, and 166.28)

The act creates the Logistics and Distribution Infrastructure Taxable Bond Fund in the state treasury.  Money in the Fund must be used to pay or make loans for allowable costs of eligible logistics and distribution projects.[80]  The Fund is to consist of the following:

(1)  Grants, gifts, and contributions of money or rights to money lawfully designated for or deposited into the Fund;

(2)  All money and rights to money lawfully appropriated and transferred to the Fund, including money received from the issuance of federally taxable obligations;

(3)  Money received from the repayment of loans and recovery on loan guarantees, including any interest, made from the Fund.

Investment earnings on the cash balance of the Fund must be credited to the Fund.  The Fund may not be comprised, in any part, of money raised by taxation.

The act authorizes the Director of Development, subject to the approval of the Controlling Board and all other applicable limitations of the law governing economic development programs, to lend money in the Logistics Distribution and Infrastructure Taxable Bond Fund to pay for allowable costs of eligible logistics and distribution projects.

Duties of Director of Development

(R.C. 166.02)

Continuing law provides that expenses and obligations incurred by the Director of Development when carrying out official duties must be paid solely from certain funds of the state, including the Facilities Establishment Fund, the Innovation Ohio Loan Guarantee Fund, and the Logistics and Distribution Infrastructure Fund.  The act adds the Logistics and Distribution Infrastructure Taxable Bond Fund to the list of funds from which the Director may pay relevant expenses and obligations.

Department of Development program to encourage businesses to hire individuals from significantly disadvantaged groups

(R.C. 122.042)

The act authorizes the Director of Development to found an employment opportunity program that encourages employers to employ individuals who are members of significantly disadvantaged groups.  The act cites, as examples of significantly disadvantaged groups, groups of individuals who have not graduated from high school, who have been convicted of a crime, who are disabled, or who are chronically unemployed, usually for more than 18 months.  If the Director intends to found such an employment opportunity program, the Director must adopt, and thereafter may amend or rescind, rules under the Administrative Procedure Act to found, and to operate, maintain, and improve, the program.  In the rules the Director must:

·         Construct, and as changing circumstances indicate, re-construct, procedures according to which significantly disadvantaged groups are identified as such, an individual is identified as being a member of a significantly disadvantaged group, and an employer is identified as being a potential employer of such an individual.

·         Describe, and as experience indicates, re-describe, the kinds of evidence that must be considered to identify significantly disadvantaged groups, the kinds of evidence an individual must offer to prove that the individual is a member of such a group, and the kinds of evidence an employer must offer to prove that the employer is a potential employer of an individual who is a member of such a group.

·         Specify, and as experience indicates, re-specify, strategies and tactics for connecting individuals who are members of significantly disadvantaged groups with potential employers of members of those groups.

·         Construct, describe, specify, define, and prescribe any other thing that is necessary and proper for the founding, and for the successful and efficient operation, maintenance, and improvement, of the employment opportunity program.

In founding, and in operating, maintaining, and improving, the employment opportunity program under these rules, the Director must proceed so that the resulting program functions as a coherent, efficient system for improving employment opportunities for significantly disadvantaged groups.

Low- and Moderate-Income Housing Trust Fund

(R.C. 173.08, 174.02, 174.03, and 174.06)

The Low- and Moderate-Income Housing Trust Fund is a fund the Department of Development administers for housing programs in the Department of Development and the Ohio Housing Finance Agency.  Continuing law places restrictions on the portion of the fund that may be used for different categories of expenditures.

The act removes the restriction on the portion of the fund that may be used for permanent and transitional housing and services for the homeless.  Prior law limited this category of expenditure to not more than 6% of any current year appropriation authority.

The act increases from 7% to 10% the portion of the fund's current year appropriation that may be used for emergency shelter housing for the homeless, and expands the types of shelters that may be funded from that category by adding shelters serving unaccompanied youth 17 years of age and younger.  Such youth shelters are a permitted expenditure under ongoing law, but located in another section of the Revised Code.  The act removes the spending authority from that section.

The act expands the purposes for funds to include (1) efforts aimed at improving the quality of life of tenants by tenant education with respect to their rights and responsibilities, planning and implementing activities designed to improve conflict resolution and mediation with landlords, and developing tenant councils and organizations, and (2) promoting capacity building initiatives related to the creation of county trust funds.

Venture Capital Authority tax credits

Continuing law establishes the Ohio Venture Capital Authority, a state agency, to administer the Ohio Venture Capital Program, the purpose of which is to increase the amount of private investment capital available in Ohio for Ohio-based businesses in the "seed" or early stages of business development and established Ohio-based businesses developing new methods or technologies.  The Authority's principal function is to develop a lending and investment policy for the investment of private capital in private, for-profit venture capital funds and similar investment vehicles, primarily Ohio-based, that invest at least 50% of their program fund money in Ohio-based businesses.  The Authority's exercise of its powers and duties is designated by law as an essential state governmental function, and the Authority is subject to all laws generally applicable to state agencies and public officials, with certain exceptions.  Its investment policy must include provision of security against program fund investors' investment losses, either directly from program fund money or tax credits against the insurance premiums franchise tax, the financial institutions franchise tax, the dealers in intangibles tax, and the personal income tax.

The Authority is charged with hiring one or two private, for-profit investment companies to execute the investment policy and to serve as the program administrator.

Composition of Authority

(R.C. 150.03)

The act changes the composition of the Ohio Venture Capital Authority by reducing its membership to three members, beginning February 1, 2010.  One member is to be appointed directly by the Governor.  One of the other two members is to be appointed by the Governor from a list of three persons nominated by the President of the Senate, and the other member is to be appointed by the Governor from a list of three persons nominated by the Speaker of the House.  If the Governor rejects all nominees on either list, the President or the Speaker must provide another list of three nominees.  The Tax Commissioner and the Director of Development will no longer be ex-officio, nonvoting members, but they are required to serve as advisors to the Authority.  The terms of the existing nine members expire January 31, 2010.  The terms of the three new members are four years each, but initially are staggered so that one member's initial term is two years, one member's is three years, and the third member's is four years.

Investment purposes

(R.C. 150.01)

Under continuing law, money in the Venture Capital "program fund" is invested in venture capital funds, which in turn invest in businesses that are in seed or early stages of development or in established businesses that are developing new methods or technologies.  The Program Fund consists of money lent to it, presumably by taxpayers in expectation of security against any losses incurred from investment of the money in venture capital funds.

The act specifies that OVC Program Funds money may be used for the "research and development" purposes of Section 2p, Article VIII, Ohio Constitution (otherwise known as the "Third Frontier" program), which authorizes the use of state general obligation bond proceeds for, among other economic development purposes, "research and product innovation, development, and commercialization through efforts by and collaboration among Ohio business and industry, state and local public entities and agencies, public and private education institutions, or research organizations and institutions . . . ."

Maximum tax credit issuance

(R.C. 150.07(D))

The act imposes a $380 million limit on the total amount of venture capital tax credits that may be authorized.  The act retains the existing $20 million annual limit.

Port authority bond funding of Third Frontier through OVC Program

(R.C. 150.01, 150.02, 150.04, 150.07, and 4582.71)

The act authorizes port authorities to use their bond issuing authority to raise funds to invest in the OVC Program Fund, which, in turn, would invest the money to fund research and development costs under the "Third Frontier" program.  The application of the bond proceeds to this purpose would be subject to an agreement between the port authority (i.e., the "issuer") and the Venture Capital Authority.  A trustee engaged by the port authority would be authorized to claim any tax credits "for the benefit of" the port authority to cover any investment losses or to restore reserves that may be used to cover losses.  The trustee would have to be a trust company or a bank with corporate trust powers that has a place of business in Ohio and that is subject to any of the following taxes at the time it claims and receives an OVC tax credit:  the income tax, corporation franchise tax (as a financial institution), the insurance company tax, the dealers in intangibles tax, public utility excise or property tax, kilowatt-hour tax, or natural gas distribution tax.[81]  Tax credits could not be used to establish reserves against losses, or to fund a reserve established with respect to a loan that has not experienced a loss.

The act "authorizes" the General Assembly to modify or repeal any of the taxes against which the OVC tax credits may be claimed, provided that the General Assembly permits OVC tax credits to be claimed against any other tax.  But if the port authority bonds are outstanding when any such modification or repeal occurs, and the modification or repeal impairs any covenant that had been made regarding reserves against losses maintained with the trustee, the act requires the state to provide "other security to the extent necessary to avoid or offset the impairment."

The act specifies a sunset date for credits arising from losses on investment of port authority bond proceeds:  such credits must be claimed by June 30, 2036.  The act defers the first day such credits may be claimed until July 1, 2012.  The act retains the existing June 30, 2026, sunset date for OVC credits not related to port authority bond-financed OVC investments.

More than one port authority may jointly exercise the authority granted to port authorities under the act.

Investment policy

(R.C. 150.03)

Under continuing law, the OVC Authority is required to maintain a written investment policy for the OVC Program that complies with a number of requirements governing, among other things, the concentration of investments in Ohio-based venture capital funds, Ohio-based businesses, and any single fund, as follows:

(1)  At least 75% of Program Fund money must be invested in Ohio-based venture capital funds.

(2)  At least 50% of OVC Program Fund money invested in a venture capital fund must be invested by the fund in "Ohio-based business enterprises" (i.e., businesses that employ at least one individual in Ohio on a full-time or part-time basis).

(3)  The amount of Program Fund money invested in any single venture capital fund, when combined with Program Fund money invested in any other fund under the same management, may not exceed the lesser of the following:  (a) $10 million or (b) 50% of the capital invested in the fund (if the fund is an Ohio-based fund) or 20% of the capital invested in the fund (in the case of any non-Ohio-based fund).

The act modifies the investment policy by setting a floor on the amount of Program Fund money that must be invested in Ohio-based businesses by venture capital funds relative to the amount of Program Fund money invested in those funds.  At the time an initial investment is committed to a venture capital fund, the total amount invested in Ohio-based businesses by all venture capital funds receiving Program Fund money must be at least equal to the amount of Program Fund money invested in those funds.

Reporting

(R.C. 150.07(A))

The act requires each OVC program administrator to estimate the amount of tax credits that are likely to be claimed in the current and succeeding fiscal year and to provide the estimate to the OVC Authority at the same time the administrator is required to file the annual audit with the Authority.

Loan guarantees for historic rehabilitation projects

(Section 521.90)

The act authorizes the Director of Development to try to obtain up to $75 million in federal economic stimulus funds and to make the funds available to secure and guarantee loans made for historic building rehabilitation projects that have been approved for an Ohio historic rehabilitation tax credit (see R.C. 149.311).  The federal funds would be any funds available under the federal American Recovery and Reinvestment Act of 2009 or any other federal source of money that may lawfully be applied to that purpose.  Any such funds obtained by the Director must be credited to the Ohio Historic Preservation Tax Credit Fund created by the act.

The Director must enter into loan guarantee contracts under the same general provisions governing Chapter 166 loan guarantees (R.C. 166.06, as authorized by Section 13, Article VIII, Ohio Constitution), except that the guarantee is secured solely by money in the Ohio Historic Preservation Tax Credit Fund instead of the existing Chapter 166 Loan Guarantee Fund.  The loan guarantee amount for any project may not exceed the tax credit amount.  Rehabilitation projects approved in the first round of rehabilitation tax credit awards would have first priority for loan guarantees.

As an uncodified provision of law, the authority expires at the end of the FY 2010-FY 2011 biennium, as provided in Section 809.10 of the act.

Compressed air included in the definition of alternative fuel

Alternative Fuel Transportation Grant Program

(R.C. 122.075)

Continuing law establishes various programs encouraging the use of alternative fuels.  The Alternative Fuel Transportation Grant Program permits the Director of Development to make grants to businesses, nonprofit organizations, public school systems, or local governments for the following purposes in order to increase the availability and use of alternative fuel:

·         Purchase and installation of alternative fuel refueling or distribution facilities and terminals;

·         Purchase and use of alternative fuel;

·         Pay the costs of education and promotional materials and activities intended for prospective alternative fuel consumers, fuel marketers, and others.

As used in the Alternative Fuel Transportation Grant Program, "alternative fuel" previously was defined to include only blended biodiesel or blended gasoline.  The act expands the definition of alternative fuel also to include compressed air used in air-compression driven engines.  Thus, under the act, grants may be awarded to businesses, nonprofit organizations, public school systems, or local governments in order to increase the availability and use of compressed air as an alternative fuel.

State vehicles capable of using alternative fuel

(R.C. 125.831)

Continuing law requires all new motor vehicles acquired by the state for the use of state agencies to be capable of using alternative fuels.  "Alternative fuel" previously was defined to include E85 blend fuel; blended biodiesel; natural gas; liquefied petroleum gas; hydrogen; any power source, including electricity; or any fuel that the United States Department of Energy determines to be substantially not petroleum and that would yield substantial energy security and environmental benefits.

The act generally retains these provisions and adds compressed air to the list of alternative fuels that new state vehicles may use.

Allocation of National Recovery Zone Bond Limitations

(R.C. 122.011)

The act authorizes the Department of Development, pursuant to federal law, to (1) allocate, among the counties and large municipalities, the portion of the national recovery zone economic development bond limitation and the national recovery zone facility bond limitation that has been allocated to Ohio, and (2) reallocate any such allocated amounts that are waived by counties or municipal corporations.

A "recovery zone economic development bond" is a bond wherein the proceeds are used to promote development or other economic activity in a recovery zone, including capital expenditures for property, expenditures for public infrastructure and construction of public facilities, and expenditures for job training and educational programs.  A "recovery zone facility bond" is a bond wherein the proceeds are used for recovery zone property.  "Recovery zone" includes any area designated as such due to general and economic distress or because of certain efforts at revitalization in the area.  Federal law establishes national limitations on the amount of such bonds that are entitled to federal tax benefits and allocates a portion of the national limit to each state.

 

I.  State Funding for Primary and Secondary Education

City, local, and exempted village school districts

·         Establishes a new school funding method that calculates an "adequacy amount" for each city, local, and exempted village school district.

·         Allows school districts to use state education funds that are not allocated for another purpose for the modification or purchase of classroom space to provide all-day kindergarten or to reduce class sizes in grades K to 3.

·         States that the act's school funding provisions neither (1) prohibit school districts, community schools, or STEM schools from using state funds to contract for services from educational service centers nor (2) prohibit school districts from using state funds to establish, operate, or participate in joint or cooperative programs with each other.

Spending accountability for school districts

·         Requires each city, local, and exempted village school district to submit to the Department of Education a spending plan for its state funds.

·         Beginning in fiscal year 2011, requires school districts with graduation rates of 80% or less (1) to obtain approval of certain components of their spending plans from the Department and the Governor's Closing the Achievement Gap Initiative and (2) to create and staff the position of "linkage coordinator" to serve as mentor and service coordinator for students at risk of not graduating, and directs the Governor's Closing the Achievement Gap Initiative to work with school districts in fiscal year 2010 to assist them in planning for implementation of these provisions.

·         Requires the Department annually to reconcile each district's spending plan with its actual spending.

·         Requires the Superintendent of Public Instruction to adopt three classes of rules prescribing spending and reporting requirements for components of the new school funding model:  (1) core academic strategies, (2) academic improvement, and (3) other funded components.

·         Sets specific spending requirements for the use of gifted education funding by school districts and educational service centers.

·         Prescribes graduated sanctions the Department must take against a school district that fails to comply with the state Superintendent's spending and reporting rules or fails to submit a spending plan, but stipulates that none of the actions may be applied before July 1, 2011, at the earliest.

·         Permits school districts to apply to the Superintendent of Public Instruction for a waiver of the state Superintendent's spending and reporting rules or the State Board of Education's new state operating standards.

·         Requires the Department to develop the "Formula ACcountability and Transparency" form, or "FACT" form, to provide to the public a comparison of a district's funded components with its spending plan.

·         Renames the "SF-3" form developed by the Department to report each school district's operating funding as the "PASS" ("PAthway to Student Success") form.

Ohio School Funding Advisory Council

·         Establishes the Ohio School Funding Advisory Council to submit biennial recommendations for revisions to the components of the adequacy amount calculation.

·         Requires the Ohio School Funding Advisory Council, by December 1, 2010, to make recommendations for (1) a student-centered evidence-based model for schools that uses a per pupil level of funding to follow a student to the school that best meets the student's individual learning needs, (2) revisions to career-technical education programming and funding, (3) a new regional service delivery system, the  educational service system governance structure, and accountability metrics for educational service centers, (4) changes to the systems of teacher compensation and retirement, (5) whether and how community schools and STEM schools should be made subject to the school funding expenditure and reporting standards adopted by the state Superintendent, and (6) the equity of open enrollment policy and financing for students and school districts.

·         Establishes a subcommittee of the Ohio School Funding Advisory Council to provide recommendations for fostering collaboration between school districts and community schools, and permits the council to establish other subcommittees and appoint some non-council members to them.

Creative learning environment classrooms

·         Establishes a 21-member "Harmon Commission" to review applications for and designate classrooms operated by school districts and community schools as creative learning environments.

·         Requires the Department of Education to provide staff to assist the Harmon Commission.

·         Authorizes each city, exempted village, or local school district, and each community school that has a memorandum of understanding with one or more school districts that specifies a collaborative agreement, to apply to the Harmon Commission for designation of one or more classrooms as creative learning environments.

·         Permits the Department to accept gifts, devises, or  bequests of money, lands, or other properties for the Harmon Commission.

·         Permits the Harmon Commission, beginning in fiscal year 2011, to award grants or stipends to school districts and community schools that have classrooms designated as creative learning environments.

Joint vocational school districts

·         Sets the payment for each joint vocational school district for fiscal years 2010 and 2011 at ¾ of 1% more than the previous year's amount.

Community school and STEM school payments

·         For deductions and payments for community school and STEM school students, sets the formula amount at $5,718 for fiscal year 2010 and $5,703 for fiscal year 2011, except for deductions and payments for special education and vocational education.

·         For special education and vocational education deductions and payments for community school and STEM school students, specifies that those amounts be computed by multiplying the respective fiscal year 2009 weight times $5,732.

Open enrollment and PSEO payments

·         For deductions and payments for interdistrict open enrollment and Post-Secondary Enrollment Options Program students, sets the formula amount at $5,732 for both fiscal years 2010 and 2011.

Ed Choice scholarships

·         Increases from $2,700 to $5,200 the annual deduction of state funds from school districts' accounts for kindergartners receiving Ed Choice scholarships.

·         Would have prescribed permanent Ed Choice maximum scholarship amounts of $4,500 for grades K to 8 and $5,300 for grades 9 to 12 for FY 2010 and thereafter (VETOED).  The veto appears to have the effect of reducing and permanently setting the maximum scholarship amount at $4,250 for grades K to 8 and $5,000 for grades 9 to 12.

Other funding provisions

·         Specifies that school districts must spend portions of their federal stimulus funds on services for students in nonpublic schools, as prescribed by federal law.

·         Authorizes the Superintendent of Public Instruction and the Chancellor of the Ohio Board of Regents jointly to adopt rules allowing school districts, community schools, STEM schools, and nonpublic schools to enter into alternative funding options to pay colleges and universities for high school students taking college courses through Post-Secondary Enrollment Options programs, including Seniors to Sophomores.

·         Prohibits all school districts from charging students who are eligible for free lunch programs any fees for materials necessary to participate in a course of instruction, instead of prohibiting only districts receiving poverty-based assistance (paid under prior law) from charging such fees to students from families receiving Ohio Works First or state disability assistance as under prior law.

·         Requires school districts that owe tuition for a regular education student housed in a residential facility to pay an amount determined by a formula approved by the Department of Education, if the student (1) resides in a facility that is not a foster home or a facility maintained by the Department of Youth Services and (2) receives educational services at the facility from a school district under contract with the facility to provide those services.

·         Specifies that a school district for which a reduction was made in its reported formula ADM for FY 2005 based on community school enrollment reports and, accordingly, for which state funding was reduced for FY 2005, 2006, or 2007, does not have a legal right to reimbursement for the reduced funding except as expressly provided in a final court judgment or in a settlement agreement executed on or before June 1, 2009.

·         Increases to $325 (from $300 under prior law) the maximum per pupil amount for reimbursement of chartered nonpublic school administrative costs.

II.  Academic Standards and Assessments

Minimum standards for schools

·         Specifies that the State Board of Education's minimum standards for public schools must require that instructional and library materials be aligned with the statewide academic content standards.

·         Requires the State Board to adopt minimum operating standards for school districts.

·         Specifies that the minimum school district operating standards override any conflicting provisions of a collective bargaining agreement between a district and its employees.

·         Modifies the requirement for the State Board to develop a standard for school districts and educational service centers (ESCs) to report financial information to the public by (1) requiring districts and ESCs to report revenues and expenditures by school building, and (2) eliminating a requirement that the reporting format include year-to-year comparisons of budgets over a five-year period.

·         Allows a school district to request a waiver from the financial reporting standard or any of the State Board's minimum standards for public schools or operating standards for districts.

Academic standards and model curricula

·         Requires the State Board of Education, by June 30, 2010, and every five years thereafter, to revise the statewide academic standards for grades K to 12 in English language arts, math, science, and social studies.

·         Requires the State Board, by March 31, 2011, to update the model curricula for the core subject areas based on the revised academic standards.

·         Requires the Superintendent of Public Instruction to present the revised academic standards and model curricula in the core subject areas to the House and Senate education committees at least 45 days prior to the deadline for their adoption.

·         Directs the State Board (1) to revise the academic standards and model curricula for grades K to 12 in fine arts and foreign language, (2) to revise the standards and curricula in computer literacy and to expand them to cover grades K to 12 (instead of grades 3 to 12, as in prior law), and (3) to adopt standards and curricula for grades K to 12 in the new area of financial literacy and entrepreneurship.

·         Requires the State Board to periodically update its physical education standards.

·         Requires the State Board to convene a committee by September 15, 2009, to provide guidance in the design of the updated academic standards and model curricula.

Achievement assessments

·         Renames the state achievement tests as "achievement assessments."

·         Combines the elementary-level reading and writing achievement assessments and diagnostic assessments into the single subject of English language arts, but delays administration of the combined achievement assessments until a date designated by the State Board of Education.

·         Reduces the number of scoring levels on the achievement assessments from five to three once the new English language arts achievement assessments are developed.

·         Transfers authority for designating dates for administration of the achievement assessments from the State Board of Education to the Superintendent of Public Instruction.

·         Eliminates a prohibition on administering the elementary achievement assessments before Monday of the week of April 24 and the Ohio Graduation Tests (OGT) to tenth graders before Monday of the week of March 15.

·         Eliminates a requirement that the elementary achievement assessments be given over a two-week period.

·         Repeals the following provisions:  (1) authority to administer an achievement assessment to limited English proficient students one week earlier than it is given to other students, (2) a requirement that alternate assessments for disabled students be submitted to the scoring company by April 1, and (3) a requirement that schools be given the option of administering the OGT for eleventh and twelfth graders and make-up assessments for sick students outside of regular school hours.

·         Prohibits release of the OGT as a public record.

·         Suspends the administration of the elementary writing and social studies achievement assessments for the 2009-2010 and 2010-2011 school years, unless the Department of Education has sufficient funds to pay for furnishing and scoring the assessments.

Replacement of OGT as graduation requirement

·         Requires the State Board of Education, Superintendent of Public Instruction, and Chancellor of the Board of Regents to develop a multi-factored assessment system to replace the OGT as a requirement for a high school diploma.

·         Specifies that the new high school assessment system must consist of (1) a nationally standardized assessment in English language arts, math, and science, (2) a series of end-of-course exams in English language arts, math, science, and social studies, and (3) a senior project completed individually or by a group of students.

·         Directs the State Board of Education to convene a group of experts and local practitioners to recommend ways to align the academic standards and model curricula with the new high school assessments and to design the end-of-course exams and scoring rubrics.

·         Requires the State Board to adopt rules for implementing the new assessment system that address (1) timelines for implementation, (2) how the system will work as a graduation requirement, and (3) its applicability to dropout programs.

·         Requires the Superintendent of Public Instruction to present the new assessment system to the House and Senate education committees at least 45 days before the State Board adopts a resolution directing the Department of Education to file the rules implementing the system in final form.

Performance indicators for report cards

·         Directs the State Board of Education to establish new performance indicators for the school district and building report cards within one year after it adopts rules to implement the new high school assessment system, and at least every six years thereafter.

·         Requires the State Board, by December 31, 2011, to establish a performance indicator that reflects the level of services provided to, and the performance of, gifted students.

·         Requires the State Board to establish the performance indicators based on recommendations of the Superintendent of Public Instruction.

·         Eliminates the requirement that the State Board establish a minimum of 17 performance indicators.

·         Repeals a requirement that the State Board include measures of high school graduates' preparedness for higher education and the workforce on the report cards.

Community service education

·         Permits community schools and STEM schools to include community service education in their educational programs, in the same manner as school districts are authorized to do under continuing law.

·         Requires the Superintendent of Public Instruction (1) to develop guidelines for rubrics for public schools to use to evaluate community service projects and (2) to adopt rules for granting students special recognition for successfully completing a community service project.

College and career readiness

·         Requires the Superintendent of Public Instruction to develop a model curriculum for instruction in college and career readiness and financial literacy in grades 7 to 12 for optional use by school districts, community schools, and STEM schools.

·         Requires each school district, community school, and STEM school to adopt a resolution describing how it will address college and career readiness and financial literacy in its seventh or eighth grade curriculum.

All-day kindergarten

·         Requires each school district to offer all-day kindergarten to all kindergarten students beginning in the 2010-2011 school year, but retains the law prohibiting a district from requiring a kindergartner to attend more than half-day kindergarten.

·         Allows school districts to apply to the Superintendent of Public Instruction for a waiver from the requirement to provide all-day kindergarten to all kindergartners.

·         Permits school districts to use space in child day-care centers licensed by the Department of Job and Family Services to provide all-day kindergarten.

·         Repeals the authority of certain school districts and community schools to charge tuition for all-day kindergarten, beginning in fiscal year 2012.

Extending the school year

·         For the 2010-2011 school year only, reduces the number of excused calamity days from five days to three days.

·         Requires the Superintendent of Public Instruction to submit recommendations on extending the school year to the General Assembly not later than December 31, 2010.

Interstate Compact

·         Ratifies the Interstate Compact on Educational Opportunity for Military Children.

·         Establishes the State Council on Educational Opportunity for Military Children and authorizes the appointment of a state compact commissioner and a military family education liaison to implement the state's participation in the compact.

Other academic provisions

·         Requires the State Board of Education to adopt standards for business education in grades 7 to 12, which any school district, community school, or STEM school may utilize (PARTIALLY VETOED).

·         Requires the State Board, by January 29, 2010, to develop a list of best practices for improving parental involvement in schools for optional use by public and nonpublic schools.

·         Permits a school district to waive the requirement to complete an eighth-grade American history course for promotion to high school for academically accelerated students who demonstrate mastery of the course content.

·         Clarifies that a high school that permits students below ninth grade to take high school work for high school credit must award high school credit for successful completion of that work.

·         Requires school districts, community schools, and STEM schools to count up to four days per school year as excused absences if a student is traveling out of state to participate in an approved enrichment or extracurricular activity, and requires that a classroom teacher accompany the student to provide instructional assistance if the student will be out of state for four or more consecutive school days.

III.  Educator Licensure and Employment

Educator licenses

·         Requires the State Board of Education to issue the following educator licenses beginning January 1, 2011:  (1) a resident educator license, (2) a professional educator license, (3) a senior professional educator license, and (4) a lead professional educator license.

·         Prescribes minimum qualifications for each of the new educator licenses.

·         Permits the State Board to issue additional educator licenses of categories and types it elects to provide.

·         Repeals the prohibition on the State Board requiring an educator license for teaching children two years old or younger.

Alternative credentials

·         Renames the alternative educator license as the "alternative resident educator license" and makes it a four-year license for teaching in grades 4 to 12 (instead of a two-year license for teaching in grades 7 to 12, as in prior law).

·         Requires the Superintendent of Public Instruction and the Chancellor of the Ohio Board of Regents to develop an intensive pedagogical training institute for applicants for the alternative resident educator license.

·         Eliminates the one-year conditional teaching permit for teaching in grades 7 to 12 and the one-year conditional teaching permit for teaching as an intervention specialist.

·         Expands the requirements for upgrading a provisional educator license for teaching in a STEM school to a professional educator license to include satisfying all of the State Board's requirements for a professional license (in addition to completing an apprenticeship program and receiving positive recommendations, as required by continuing law).

Principal licenses

·         Specifies that the State Board of Education's qualifications for obtaining a principal license must be aligned with the Educator Standards Board's principal standards.

Transition

·         Requires the State Board of Education to accept applications for the former types of educator licenses through December 31, 2010, and to issue the licenses in accordance with prior requirements, and specifies that those licenses remain valid until they expire.

Ohio Teacher Residency Program

·         Requires the Superintendent of Public Instruction and the Chancellor of the Ohio Board of Regents to establish the Ohio Teacher Residency Program for entry-level classroom teachers.

Educator preparation programs

·         Transfers responsibility for approving teacher preparation programs from the State Board of Education to the Chancellor of the Ohio Board of Regents and expands the duty to include approval of preparation programs for other educators and school personnel.

·         Directs the Chancellor, jointly with the Superintendent of Public Instruction, to (1) establish metrics and preparation programs for educators and other school personnel and the institutions of higher education with preparation programs and (2) to provide for inspection of those institutions.

·         Requires the Chancellor (instead of the State Board as in prior law) to issue an annual report on the quality of approved teacher preparation programs.

·         Requires the Department of Education to share with the Chancellor aggregate student data generated in connection with the value-added progress dimension.

Licensure of school nurses

·         Requires the State Board of Education to adopt rules establishing standards and requirements for obtaining a school nurse license and a school nurse wellness coordinator license.

·         Directs the Department of Education to provide the results of any examinations required for licensure as a school nurse or school nurse wellness coordinator to the Chancellor of the Ohio Board of Regents, to the extent permitted by law.

·         Establishes the School Health Services Advisory Council to make recommendations on (1) the coursework required to obtain a school nurse license and a school nurse wellness coordinator license and (2) best practices for the use of school nurses and school nurse wellness coordinators in providing health and wellness programs for students and employees of public schools.

Educator Standards Board

·         Requires the Educator Standards Board to develop and recommend to the State Board of Education, by September 1, 2010, revised standards for teachers and principals, license renewal, and educator professional development and new standards for school district superintendents, treasurers, and business managers.

·         Establishes the Subcommittee on Standards for Superintendents and the Subcommittee on Standards for School Treasurers and Business Managers to assist the Educator Standards Board in developing standards for those officials.

·         Directs the Educator Standards Board to (1) develop model teacher and principal evaluations, (2) adopt criteria that an applicant for a lead professional educator license who is not certified by the National Board for Professional Teaching Standards and does not meet the definition of "master teacher" must meet to be considered a lead teacher, (3) develop a measure of individual students' academic improvement over a one-year period and make recommendations for incorporating the measure into evaluations and licensure eligibility for teachers and principals, and (4) make recommendations for creating school district and building leadership academies.

·         Repeals the requirement that the Educator Standards Board collaborate with teacher preparation programs to align their coursework with the teacher and principal standards developed by the Board and the State Board of Education's academic content standards.

·         Adds a school district treasurer or business manager, a parent, and one more high school teacher and one more elementary school teacher to the Educator Standards Board as voting members and adds the ranking minority members of the House and Senate education committees as nonvoting members.

·         Transfers authority to appoint the representatives of institutions of higher education on the Educator Standards Board from the State Board of Education to the Chancellor of the Ohio Board of Regents.

·         Requires the membership of the Educator Standards Board to reflect Ohio's diversity in terms of gender, race, ethnicity, and geographic distribution.

Peer assistance and review programs

·         Requires the Department of Education, by December 31, 2010, to develop a model peer assistance and review program and to make recommendations to expand the use of peer assistance and review programs in school districts.

Teach Ohio Program

·         Directs the Chancellor of the Ohio Board of Regents and the Superintendent of Public Instruction to establish and administer the Teach Ohio Program, which includes (1) a statewide program administered by a nonprofit corporation that encourages high school students from economically disadvantaged groups to become teachers, (2) the Ohio Teaching Fellows Program, (3) the Ohio Teacher Residency Program, (4) alternative licensure programs, and (5) any other program identified by the Chancellor and Superintendent.

·         If sufficient funds are available, permits the Chancellor and the Superintendent to create the Ohio Teaching Fellows Program to provide undergraduate scholarships for qualified students going into the teaching profession who commit to teach at a hard-to-staff, or academic watch or academic emergency, public school for at least four years.

·         Stipulates that failure to fulfill the four-year teaching commitment in the Ohio Teaching Fellows Program will result in the conversion of the scholarship into a loan that accrues interest at 10% annually.

Teacher tenure

·         Revises the qualifications for a continuing contract (tenure) for regular classroom teachers who become licensed for the first time on or after January 1, 2011, so that a teacher is eligible for tenure if the teacher (1) holds a professional, senior professional, or lead professional educator license, (2) has held an educator license for at least seven years, and (3) has completed 30 semester hours of coursework in the area of licensure since initially receiving a license, if the teacher did not have a master's degree at the time of initial licensure, or six semester hours of graduate coursework in the area of licensure since initially receiving a license, if the teacher had a master's degree at that time.

·         Stipulates that the tenure qualifications for teachers initially licensed on or after January 1, 2011, override any conflicting collective bargaining agreement entered into on or after the provision's effective date.

·         Clarifies that, for classroom teachers licensed for the first time prior to January 1, 2011, the continuing education coursework required for tenure under continuing law must have been completed since initial receipt of an educator license other than a substitute teaching license.

Termination of educator employment contracts

·         Eliminates "gross inefficiency or immorality" and "willful and persistent violations of reasonable regulations of the board of education" but retains "good and just cause" as statutory grounds for termination of a school district employment contract with a licensed educator.

·         Specifies that the act's changes to the grounds for termination of an educator's employment contract prevail over conflicting provisions of a collective bargaining agreement entered into after the changes' effective date.

·         Repeals a provision that limited referees who hear termination cases of licensed educators to hearing no more than two cases per school year.

IV.  Community Schools

·         Beginning July 1, 2009, replaces the performance criteria that trigger automatic closure of a community school with new criteria requiring a community school to close if it (1) does not offer a grade higher than 3 and has been in academic emergency for three of the four most recent school years, (2) offers any of grades 4 to 8 but no grade higher than 9, has been in academic emergency for two of the three most recent school years, and showed less than one year of academic growth in reading or math for at least two of the three most recent school years, or (3) offers any of grades 10 to 12 and has been in academic emergency for three of the four most recent school years.

·         Exempts from the automatic closure requirement community schools in which a majority of the students are children with disabilities receiving special education (in addition to community schools operating dropout programs with a waiver from the Department of Education, as in continuing law).

·         Specifies that if a community school closes, the chief administrative officer must transmit within seven business days all student educational records to the students' resident districts, and that failure to do so is a third degree misdemeanor.

·         Clarifies that the Department of Education's authority to oversee and monitor community school sponsors applies to all sponsors, regardless of whether they must initially be approved by the Department for sponsorship.

·         Requires the Department's annual report on community schools to include the performance of community school sponsors.

·         Revises the requirement that new start-up community schools contract with an operator that manages other schools that perform better than academic watch in order to open despite the moratorium on new start-up schools, by specifying that if the operator already manages community schools in Ohio, at least one of the operator's Ohio schools (rather than any school managed by the operator, as in prior law) must perform at that level.

·         Requires the Department of Education to begin issuing report cards for a community school after its first year of operation (instead of after its second year of operation, as in former law).

·         Prohibits consideration of a community school's performance ratings for its first two years of operation in any matter in which those ratings are a factor, including the automatic closure criteria for poor academic performance.

·         Duplicates, also in uncodified law, Section 269.60.60 of Am. Sub. H.B. 119 of the 127th General Assembly, which prescribes procedures for the Auditor of State, community school sponsors, and the Department of Education with regard to unauditable community schools.

·         Permits a community school to continue operating from the facility it occupied in the 2008-2009 school year, rather than relocating to another school district, if the school (1) has been in its current facility for at least three years, (2) is sponsored by a school district adjacent to the district in which the school is located, (3) emphasizes serving gifted students, and (4) has been rated continuous improvement or higher for the previous three years.

·         Permits the conversion of a building operated by a joint vocational school district into a community school, in the same manner as a building operated by a city, local, or exempted village school district under continuing law.

·         Eliminates the prohibition on Internet- or computer-based community schools (e‑schools) counting expenditures for computers and software toward their required minimum level of spending for instructional purposes.

·         Would have required the Department of Education to waive the number of hours a community school is closed for a public calamity as long as the school provides the required minimum number of learning opportunities to students in the school year (VETOED).

V.  Scholarship programs

·         Would have qualified for the Educational Choice Scholarship students who (1) were enrolled in, (2) were eligible to enroll in kindergarten in the school year for which the scholarship is sought and would otherwise be assigned to, or (3) were enrolled in a community school but otherwise be assigned to, a new school building that is operated by the student's resident district under certain circumstances (VETOED).

·         Requires all nonpublic schools that participate in the Cleveland Scholarship Program (in addition to nonpublic schools that participate in the Ed Choice Scholarship Program, as in continuing law) to administer the state achievement assessments to enrolled scholarship students and to report their scores to the Department of Education.

·         Requires the Department to post achievement assessment data for students participating in the Cleveland Scholarship Program or the Ed Choice Scholarship Program on its web site and to distribute that data to the parents of students eligible for the programs.

·         Requires the Department to provide the parent of each Cleveland or Ed Choice scholarship student with a comparison of the student's performance on the achievement assessments with the average performance of similar students enrolled in the school district building the scholarship student would otherwise attend.

VI.  Early Childhood Programs

·         Creates the Center for Early Childhood Development to make recommendations regarding the transfer from other state agencies to the Department of Education of the responsibility to coordinate early childhood programs and services.

·         Creates the Early Childhood Advisory Council to serve as the federally mandated State Advisory Council on Early Childhood Education and Care.

·         Creates the Early Childhood Financing Workgroup to develop recommendations that explore the implementation of a single financing system for early care and education programs.

·         Continues for the 2010-2011 biennium a GRF-funded program to support early childhood education programs offered by school districts and educational service centers to preschool children whose families earn up to 200% of the federal poverty guidelines.

·         Would have re-established the Early Learning Initiative, jointly administered by the Department of Education and the Department of Job and Family Services, to provide early learning services to children eligible for federal Title IV-A (TANF) services (VETOED).

·         Requires the Governor to appoint to the Early Childhood Cabinet a representative of a board of health of a city or general health district or an authority having the duties of a board of health.

·         Reduces the number of inspections of preschool and latchkey programs by the Department of Education from twice to once during each 12-month period, but permits the Department to inspect any program more than once during a 12-month period as it considers necessary.

VII.  Other Provisions

·         Requires the Superintendent of Public Instruction to develop a ten-year strategic plan by December 1, 2009.

·         Abolishes the Partnership for Continued Learning, and transfers the responsibilities of the STEM subcommittee of the Partnership to an independent STEM committee.

·         Permits the Superintendent of Public Instruction to establish the Center for Creativity and Innovation within the Department of Education.

·         Requires the State Board of Education to post via the Internet audio recordings of its regular and special business meetings within five days of the meeting.

·         Eliminates the law that permits the Department of Education to contract with an independent for-profit or nonprofit entity to provide information on Ohio government through the Ohio Education Computer Network (OECN) to school district libraries to assist teachers in social studies course instruction and support student research projects.

·         Permits the Department to approve and administer funding for educational technology for OECN information technology centers, school districts, educational service centers, and other entities.

·         Specifies that OECN information technology centers are not required to maintain operating reserve accounts or funds or minimum cash balances relative to their operating funding.

·         Allows the Department to use volunteers in performing the Department's functions.

·         Requires each school district to appoint a family and civic engagement team to consist of parents and members of the community, representatives of health and human services and business, and others.

·         Permits city and exempted village school districts to appoint one committee that functions as both a business advisory council and a family and civic engagement team.

·         Prohibits corporal punishment in all public schools, but retains preexisting law permitting school employees to use force or restraint as reasonable or necessary to quell a disturbance, to obtain possession of a weapon, for self-defense, or to protect persons or property.

·         Beginning July 1, 2011, permits only school district employees who are licensed health professionals, or who have completed an appropriate drug administration training program conducted by a licensed health professional to administer prescription drugs to students in school districts.

·         Repeals the law establishing the School Health and Safety Network under which boards of health, in accordance with standards and procedures adopted by the Director of Health, inspected public and chartered nonpublic schools and their grounds at least annually to identify conditions dangerous to public health and safety.

·         Requires boards of health to inspect the sanitary condition of schools semiannually (rather than annually, under prior law).

·         Repeals authorization for boards of health to close a school for an imminent public health threat other than an epidemic or a high prevalence of communicable disease.

·         Requires school districts, community schools, STEM schools, and chartered nonpublic schools periodically to review their policies and procedures to ensure (1) the safety of persons using a school from known hazards that pose an immediate risk to health or safety and (2) compliance with federal health and safety laws and regulations applicable to schools.

·         Requires school districts, community schools, STEM schools, and chartered nonpublic schools to establish policies to protect students with peanut or other food allergies.

·         Specifies that when a person is subject to a periodic criminal records check as a condition of licensure by the State Board of Education or of employment with a public or chartered nonpublic school, the records check is limited to an FBI check if (1) the State Board or employer has previously requested a records check of the person by the Bureau of Criminal Identification and Investigation (BCII) and (2) the person provides proof of Ohio residency for the previous five-year period.

·         Prohibits the State Board from requiring a criminal records check for licensure purposes any more often than every five years.

·         Requires school districts, community schools, STEM schools, and chartered nonpublic schools annually to inform students and parents of the parental notification procedures in the school's protocol for responding to threats and emergency events.

·         Extends to middle and secondary schools the existing requirement that specified categories of school employees complete four hours of in-service training in the prevention of child abuse, violence, substance abuse, and the promotion of positive youth development.

·         Directs districts and schools to incorporate training in school safety and violence prevention into their in-service training in the prevention of child abuse, violence, substance abuse, and the promotion of positive youth development.

·         Modifies procedures that the State Board is required to adopt with respect to children with disabilities by specifying who may appoint the surrogate for a child whose parents cannot be found or who is a ward of the state.

·         Would have placed a two-year moratorium on local school districts relocating from their current educational service centers (ESCs) to adjacent ESCs, and would have voided recently approved, as well as pending, resolutions for such relocations (VETOED).

·         Would have specified that when the State Board considers a local school district's relocation to an adjacent ESC, it must (1) consider the impact on the district's current ESC (in addition to the impact on the district and the ESC to which the district seeks to relocate, as in continuing law) and the financial, staffing, and programmatic impacts on all parties involved, (2) consider the proposed relocation at two or more meetings with an opportunity for public testimony at each meeting, and (3) provide at least 30 days before the Board's first hearing on the matter and its vote (VETOED).

·         Would have provided procedures for dissolving an ESC if all of its "local" school districts sever from it and annex to another ESC (VETOED).

·         Would have permanently permitted a "city" or "exempted village" school district that entered into an agreement for services from an ESC that is dissolved to enter into a new agreement with another ESC, which may receive per pupil state funds in the same manner as the original ESC (VETOED).

·         Prohibits school districts from preventing a teacher from providing time to recite the Pledge of Allegiance to the flag in the teacher's classroom.

·         Prohibits school districts from altering the Pledge of Allegiance to the flag from the wording set forth in the United States Code.

·         Permits two local school districts to renew their contract for vocational education (career-technical) services for a term of less than five years, if the district receiving the services had been created out of the territory of the district providing the services and began operating in fiscal year 2005.

·         Repeals a statutory procedure for a school district not covered by the state Civil Service Law to terminate some or all of its pupil transportation staff and to instead engage an independent contractor to provide pupil transportation.

·