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As Passed by the House
123rd General Assembly
Regular Session
1999-2000 | Am. Sub. S. B. No. 265 |
SENATORS HORN-HAGAN-SPADA-WATTS-ARMBRUSTER-BRADY-LATELL-GARDNER
REPRESENTATIVES KREBS-HARTNETT-BENDER-PATTON-AUSTRIA-HOLLISTER-
VAN VYVEN-MOTTLEY-WILSON
A BILL
To amend sections 1724.05, 1724.06, 1726.11, 1726.12, 5709.67, and 5709.68 of
the Revised Code to modify
requirements concerning the Department of Development's annual
enterprise zone report, to increase the penalty
assessed against municipal corporations and counties that fail to meet annual
enterprise zone agreement reporting requirements from $500 to $1,000,
and to transfer the oversight
of community improvement corporations and development corporations from the
Director of Development to the Auditor of State.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 1724.05, 1724.06, 1726.11, 1726.12, 5709.67, and
5709.68 of the Revised Code be amended to
read as follows:
Sec. 1724.05. Annually, before the thirty-first day of January, each
EACH
community improvement corporation shall submit a PREPARE AN ANNUAL
FINANCIAL report THAT CONFORMS to
RULES PRESCRIBED BY THE AUDITOR OF STATE PURSUANT TO
SECTION 117.20 OF THE REVISED CODE, THAT IS PREPARED
ACCORDING TO
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES, AND THAT IS CERTIFIED BY THE BOARD
OF TRUSTEES OF THE
CORPORATION OR ITS TREASURER OR OTHER CHIEF FISCAL OFFICER. THE FINANCIAL
REPORT SHALL BE FILED WITH
THE AUDITOR OF STATE WITHIN ONE HUNDRED TWENTY DAYS FOLLOWING THE
LAST DAY OF THE CORPORATION'S FISCAL YEAR, UNLESS
the director of
development AUDITOR OF STATE
EXTENDS THAT DEADLINE. THE AUDITOR OF STATE MAY ESTABLISH
TERMS AND CONDITIONS FOR GRANTING ANY EXTENSION OF THAT DEADLINE. The
director, by rule, shall
establish guidelines governing the
scope and frequency of audits of such corporations. Each
EACH COMMUNITY IMPROVEMENT
corporation, when
required SHALL SUBMIT TO AUDITS by the director AUDITOR
OF STATE, shall submit an audit
THE SCOPE AND FREQUENCY OF WHICH SHALL BE IN ACCORDANCE
WITH SECTION 117.11 OF THE REVISED CODE AS IF THE
CORPORATION WERE A
PUBLIC OFFICE SUBJECT TO THAT SECTION. HOWEVER, A COMMUNITY IMPROVEMENT
CORPORATION MAY REQUEST IN
ACCORDANCE WITH SECTION 115.56 OF THE REVISED CODE, AS IF
THE
CORPORATION WERE A PUBLIC OFFICE SUBJECT TO THAT SECTION, THE PERFORMANCE OF
ANY
OF THOSE AUDITS
by a AN INDEPENDENT certified public
accountant. The director
THE AUDITOR OF STATE is hereby authorized
to receive and file THE annual FINANCIAL
reports REQUIRED BY THIS SECTION and THE REPORTS OF ALL audits
PERFORMED IN ACCORDANCE WITH THIS SECTION. Annual reports shall
cover all
financial and other
transactions of the corporation for the preceding year. Audits shall cover
such period of time as the
director specifies. The director
AUDITOR OF STATE shall analyze the THOSE
annual FINANCIAL reports and THE REPORTS OF THOSE audits to
determine whether or
not the activities of the COMMUNITY IMPROVEMENT
corporation INVOLVED are in accordance with Chapter 1724. of the
Revised Code
THIS CHAPTER.
Sec. 1724.06. If any COMMUNITY IMPROVEMENT corporation FAILS TO
PREPARE AN ANNUAL FINANCIAL REPORT AS required by
SECTION 1724.05 OF THE REVISED CODE AND TO
FILE THAT REPORT WITH THE AUDITOR OF STATE WITHIN NINETY DAYS OF THE TIME
PRESCRIBED FOR THAT FILING BY
THAT
section
1724.05 of the Revised Code to submit reports or
audits fails or
neglects to make the annual report to the director of
development
as required by law for ninety days after the time
prescribed by
law for making such report, or fails to submit the
results of an
audit within ninety days of the date for submission of the
audit
as specified by the director,
OR
IF THE AUDITOR OF STATE DETERMINES BY APPLYING THE STANDARDS
APPLICABLE TO A PUBLIC OFFICE UNDER SECTION 117.41 OF THE REVISED
CODE THAT ANY COMMUNITY IMPROVEMENT CORPORATION CANNOT BE
AUDITED AND DECLARES IT TO BE UNAUDITABLE AND THE CORPORATION FAILS TO
THEN PREPARE AN ANNUAL FINANCIAL REPORT AS REQUIRED BY SECTION 1724.05
OF THE REVISED CODE AND TO FILE THAT REPORT WITH THE AUDITOR
OF
STATE WITHIN NINETY DAYS OF THE TIME THAT THE AUDITOR OF STATE DECLARED THE
CORPORATION TO BE UNAUDITABLE,
the
director AUDITOR OF STATE shall certify such THAT
fact to the secretary of state. The secretary of state THEN shall
thereupon cancel the articles of the COMMUNITY IMPROVEMENT
corporation INVOLVED by filing and
recording the certificate of the director AUDITOR OF STATE or a
true copy
thereof OF IT.
Thereupon all ALL of the rights, privileges, and franchises
conferred
upon such THAT COMMUNITY IMPROVEMENT corporation by such
THOSE articles
of incorporation THEN shall
cease. The secretary of state shall immediately notify the THAT
COMMUNITY IMPROVEMENT
corporation of the action taken. Reinstatement may be accomplished
within two years after such THAT cancellation upon proper filing
of
all delinquent ANNUAL FINANCIAL reports and audits to the
satisfaction of the
director AUDITOR OF STATE and THE filing his OF
THE AUDITOR OF STATE'S
certificate thereof REFLECTING THAT SATISFACTION with
the secretary of state, who shall be entitled to a fee of ten dollars
for
recording the same CERTIFICATE in the corporate records.
Such THAT filing may be made by any
officer, member, creditor, receiver, lessee, or sublessee of the
COMMUNITY IMPROVEMENT corporation INVOLVED, and any such person
or his agent OF ANY SUCH PERSON
shall be granted access to the books and records of the corporation for
such THAT
purpose. The rights, privileges, and franchises of a COMMUNITY
IMPROVEMENT corporation whose
articles have been reinstated are subject to section 1702.60 of the Revised
Code.
Sec. 1726.11. Annually before the thirty-first day of January, a
EACH DEVELOPMENT corporation
incorporated under Chapter 1726. of the Revised Code THIS
CHAPTER shall submit a PREPARE AN ANNUAL FINANCIAL report
THAT CONFORMS to
RULES PRESCRIBED BY THE AUDITOR OF STATE PURSUANT TO
SECTION 117.20 OF THE REVISED CODE, THAT IS PREPARED
ACCORDING TO
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES, AND THAT IS CERTIFIED BY THE BOARD
OF TRUSTEES OF THE
CORPORATION OR ITS TREASURER OR OTHER CHIEF FISCAL OFFICER. THE FINANCIAL
REPORT SHALL BE FILED WITH
THE AUDITOR OF STATE WITHIN ONE HUNDRED TWENTY DAYS FOLLOWING THE
LAST DAY OF THE CORPORATION'S FISCAL YEAR, UNLESS
the director of development together
with an audit by a certified public
accountant and the director of development
AUDITOR OF STATE EXTENDS
THAT DEADLINE. THE AUDITOR OF STATE MAY ESTABLISH TERMS AND CONDITIONS FOR
GRANTING ANY
EXTENSION OF THAT DEADLINE.
EACH DEVELOPMENT CORPORATION SHALL SUBMIT TO AUDITS BY THE AUDITOR
OF STATE, THE SCOPE AND FREQUENCY OF WHICH SHALL BE IN ACCORDANCE
WITH SECTION 117.11 OF THE REVISED CODE AS IF THE
CORPORATION WERE A
PUBLIC OFFICE SUBJECT TO THAT SECTION. HOWEVER, A DEVELOPMENT CORPORATION MAY
REQUEST IN ACCORDANCE
WITH SECTION 115.56 OF THE REVISED CODE, AS IF THE
CORPORATION WERE
A PUBLIC OFFICE SUBJECT TO THAT SECTION, THE PERFORMANCE OF ANY OF THOSE
AUDITS
BY AN INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT.
THE AUDITOR OF
STATE is hereby authorized to receive
and file the same ANNUAL FINANCIAL REPORTS REQUIRED BY THIS SECTION
AND THE REPORTS OF ALL AUDITS PERFORMED IN ACCORDANCE WITH THIS SECTION.
Such reports and audits shall cover all financial
and
other transactions of said corporation for the preceding
year. Said director
of development THE AUDITOR OF STATE shall analyze said
THOSE ANNUAL FINANCIAL reports and THE REPORTS OF THOSE audits
to determine whether or
not the activities of such corporations THE DEVELOPMENT
CORPORATION INVOLVED are in
accordance with Chapter 1726.
of the Revised Code THIS CHAPTER.
Sec. 1726.12. If any DEVELOPMENT corporation FAILS TO PREPARE AN
ANNUAL FINANCIAL REPORT AS required by
SECTION 1726.11 OF THE REVISED CODE AND TO FILE THAT
REPORT WITH THE AUDITOR OF STATE WITHIN NINETY DAYS OF THE TIME PRESCRIBED FOR
THAT FILING BY THAT
section 1726.11 of the Revised
Code fails or neglects to make the annual
report to the
director of
development as required by law for ninety days
after the time prescribed by
law for making such report,
OR
IF THE AUDITOR OF STATE DETERMINES BY APPLYING THE STANDARDS
APPLICABLE TO A PUBLIC OFFICE UNDER SECTION 117.41 OF THE REVISED
CODE THAT ANY DEVELOPMENT CORPORATION CANNOT BE AUDITED AND
DECLARES IT TO BE UNAUDITABLE AND THE CORPORATION FAILS TO THEN
PREPARE AN ANNUAL FINANCIAL REPORT AS REQUIRED BY SECTION 1726.11 OF
THE REVISED CODE AND TO FILE THAT REPORT WITH THE AUDITOR OF
STATE
WITHIN NINETY DAYS OF THE TIME THAT THE AUDITOR OF STATE DECLARED THE
CORPORATION TO BE UNAUDITABLE,
or if any such ANNUAL FINANCIAL
report discloses that the ANY DEVELOPMENT
corporation has failed to begin business for a period of three years from the
effective date of the filing of its articles of incorporation, the director
of
development AUDITOR OF STATE shall certify such THAT
fact to the secretary of state. The secretary
of state THEN shall thereupon cancel the articles of the
DEVELOPMENT corporation INVOLVED by appropriate
entry upon the margin of the record thereof OF THE ARTICLES.
Thereupon, all ALL the powers,
privileges, and franchises conferred upon such THAT DEVELOPMENT
corporation
by such THOSE articles of
incorporation THEN shall cease. The secretary of state shall
immediately notify
the THAT DEVELOPMENT
corporation of the action taken.
Sec. 5709.67. (A) Except as otherwise provided in
sections 5709.61 to 5709.69 of the Revised Code, the director of
development shall administer those sections and shall adopt such
rules as are necessary to ensure that no zone is certified or
remains certified unless it meets any applicable requirements of
division (A) of section 5709.61 of the Revised Code, and to
determine the number of positions attributable to an enterprise
for the purposes of division (A)(3) of section 5709.64 of the
Revised Code. The director shall assign to each zone currently
certified a unique designation by which the zone shall be
identified for purposes of administering sections 5709.61 to
5709.69 of the Revised Code. The tax commissioner shall
administer all other tax incentives provided under sections
5709.61 to 5709.69 of the Revised Code and shall adopt such rules
as are necessary to carry out that duty. No tax incentive
qualification certificate or employee tax credit certificate
shall be issued or remain in effect unless the enterprise
applying for or holding the certificate complies with all such
rules. The director of job and family
services shall administer the
incentive provided under division (B)(1) of section 5709.66 of
the Revised Code and shall adopt such rules as are necessary to
carry out that duty. No extension of benefits certificate shall
be issued or remain in effect unless the enterprise applying for
or holding the certificate complies with all such rules.
(B) Annually NOT LATER THAN THE FIRST DAY OF AUGUST EACH
YEAR, the director of development shall report to
the general assembly the ON ALL OF THE FOLLOWING FOR THE PRECEDING
CALENDAR YEAR:
(1) THE cost to the state of the tax and other
incentives provided under sections 5709.61 to 5709.69 of the
Revised Code, the;
(2) THE number of tax incentive qualification
certificates, employee tax credit certificates, and extension of
benefits certificates issued, the;
(3) THE names of the municipal
corporations and counties that have entered agreements under
sections 5709.62, 5709.63, and 5709.632 of the Revised Code, and
the;
(4) THE number of new employees hired as a result of the tax and
other incentives provided under sections 5709.61 to 5709.69 of
the Revised Code;
(5) INFORMATION ON AGREEMENT TERMS CONCERNING SCHOOL DISTRICT
REVENUE THAT ARE NOT PROVIDED FOR IN SECTION 5709.631 OF THE
REVISED
CODE AND THAT ARE FORWARDED TO THE
DIRECTOR UNDER DIVISION (H) OF SECTION 5709.62, DIVISION
(H) OF SECTION 5709.63, OR DIVISION
(G) OF SECTION 5709.632 OF THE REVISED CODE.
The
THE report shall include a finding by the
director as to whether the incentives provided under sections
5709.61 to 5709.69 of the Revised Code have resulted in the
creation of more positions in the state than would have been
created without the incentives.
THE DIRECTOR SHALL SEND A COPY OF THE REPORT TO EACH MEMBER OF THE
GENERAL ASSEMBLY AND TO THE DIRECTOR OF THE LEGISLATIVE SERVICE
COMMISSION.
(C) All forms used in connection with the administration
of sections 5709.61 to 5709.69 of the Revised Code, except forms
administered directly by the tax commissioner, by the
director of job and family services, or by a county or
municipal
corporation, are subject to review and approval by the state
forms management control center under sections 125.91 to 125.98
of the Revised Code.
Sec. 5709.68. (A) On or before the thirty-first day of
March each year, a municipal corporation or county that has
entered into an agreement with an enterprise under section
5709.62, 5709.63, or 5709.632 of the Revised Code shall submit to
the director of development and the board of education of each
school district of which a municipal corporation or township to
which such an agreement applies is a part a report on all such OF
THOSE
agreements in effect during the preceding calendar year. The
report shall include ALL OF the FOLLOWING information
described in divisions
(A)(1) to (7) of this section.:
(1) The designation, assigned by the director of
development, of each urban jobs and enterprise zone within the
municipal corporation or county, the date each zone was
certified, the name of each municipal corporation or township
within each zone, and the total population of each zone according
to the most recent data available.;
(2) The number of enterprises that are subject to such THOSE
agreements and the number of full-time employees subject to those
agreements within each zone, each according to the most recent
data available and identified and categorized by the appropriate
standard industrial code, and the rate of unemployment in the
municipal corporation or county in which the zone is located for
each year since each zone was certified.;
(3) The number of agreements approved and executed during
the calendar year for which the report is submitted, the total
number of agreements in effect on the thirty-first day of
December of the preceding calendar year, the number of agreements
that expired during the calendar year for which the report is
submitted, and the number of agreements scheduled to expire
during the calendar year in which the report is submitted. For
each agreement that expired during the calendar year for which
the report is submitted, the municipal corporation or county
shall include the amount of taxes exempted and the estimated
dollar value of any other incentives provided under the
agreement.
(4) The number of agreements receiving compliance reviews
by the tax incentive review council in the municipal corporation
or county during the calendar year for which the report is
submitted, including all of the following information:
(a) The number of agreements the terms of which an
enterprise has complied with, indicating separately for each such
agreement the value of the real and personal property exempted
pursuant to the agreement and a comparison of the stipulated and
actual schedules for hiring new employees, for retaining existing
employees, for the amount of payroll of the enterprise
attributable to these employees, and for investing in
establishing, expanding, renovating, or occupying a facility;
(b) The number of agreements the terms of which an
enterprise has failed to comply with, indicating separately for
each such agreement the value of the real and personal property
exempted pursuant to the agreement and a comparison of the
stipulated and actual schedules for hiring new employees, for
retaining existing employees, for the amount of payroll of the
enterprise attributable to these employees, and for investing in
establishing, expanding, renovating, or occupying a facility;
(c) The number of agreements about which the tax incentive
review council made recommendations to the legislative authority
of the municipal corporation or county, and the number of such
THOSE
recommendations that have not been followed;
(d) The number of agreements rescinded during the calendar
year for which the report is submitted.
(5) The number of enterprises that are subject to
agreements that expanded within each zone, including the number
of new employees hired and existing employees retained by each
such enterprise, and the number of new enterprises that are
subject to agreements and that established within each zone,
including the number of new employees hired by each such
enterprise.;
(6)(a) The number of enterprises that are subject to
agreements and that closed or reduced employment at any place of
business within the state for the primary purpose of
establishing, expanding, renovating, or occupying a facility,
indicating separately for each such enterprise the political
subdivision in which the enterprise closed or reduced employment
at a place of business and the number of full-time employees
transferred and retained by each such place of business.;
(b) The number of enterprises that are subject to
agreements and that closed or reduced employment at any place of
business outside the state for the primary purpose of
establishing, expanding, renovating, or occupying a facility.
(7) For each agreement in effect during any part of the
preceding year, the number of employees employed by the
enterprise at the project site immediately prior to formal
approval of the agreement, the number of employees employed by
the enterprise at the project site on the thirty-first day of
December of the preceding year, the payroll of the enterprise for
the preceding year, the amount of taxes paid on tangible personal
property situated at the project site and the amount of such
THOSE
taxes that were not paid because of the exemption granted under
the agreement, and the amount of taxes paid on real property
constituting the project site and the amount of such THOSE taxes
that
were not paid because of the exemption granted under the
agreement. If an agreement was entered into under section
5709.632 of the Revised Code with an enterprise described in
division (B)(2) of that section, the report shall include the
number of employee positions at all of the enterprise's locations
in this state. If an agreement is conditioned on a waiver issued
under division (B) of section 5709.633 of the Revised Code on the
basis of the circumstance described in division (B)(3)(a) or (b)
of that section, the report shall include the number of employees
at the facilities referred to in division (B)(3)(a)(i) or (b)(i)
of that section, respectively.
(B) Upon the failure of a municipal corporation or county
to comply with division (A) of this section:
(1) Beginning on the first day of April of the calendar
year in which the municipal corporation or county fails to comply
with that division, the municipal corporation or county shall not
enter into any agreements with an enterprise under section
5709.62, 5709.63, or 5709.632 of the Revised Code until the
municipal corporation or county has complied with division (A) of
this section.
(2) On the first day of each ensuing calendar month until
the municipal corporation or county complies with that division
(A) OF THIS SECTION,
the director of development shall either order the proper county
auditor to deduct from the next succeeding payment of taxes to
the municipal corporation or county under section 321.31, 321.32,
321.33, or 321.34 of the Revised Code an amount equal to five
hundred ONE THOUSAND dollars for each calendar month the municipal
corporation
or county fails to comply with that division, or order the county
auditor to deduct such an THAT amount from the next succeeding
payment
to the municipal corporation or county from the undivided local
government fund under section 5747.51 of the Revised Code. At
the time such a payment is made, the county auditor shall comply
with the director's order by issuing a warrant, drawn on the fund
from which such THE money would have been paid, to the
director of
development, who shall deposit the warrant into the state urban
jobs and enterprise zone program administration fund created in
division (C) of this section.
(C) The director, by rule, shall establish the state's
application fee for applications submitted to a municipal
corporation or county to enter into an agreement under section
5709.62, 5709.63, or 5709.632 of the Revised Code. In
establishing the amount of the fee, the director shall consider
the state's cost of administering the enterprise zone program,
including the cost of reviewing the reports required under
division (A) of this section. The director may change the amount
of the fee at such THE times and in such THE
increments as he deems THE DIRECTOR CONSIDERS
necessary. Any municipal corporation or county that receives an
application shall collect the application fee and remit the fee
for deposit in the state treasury to the credit of the state
enterprise zone program administration fund, which is hereby
created. Money credited to the fund shall be used by the
department of development to pay the costs of administering the
enterprise zone program, including the cost of reviewing the
reports required under division (A) of this section.
(D) On or before the thirtieth day of June each year, the
director of development shall certify to the tax commissioner the
information described under division (A)(7) of this section,
derived from the reports submitted to the director under this
section.
On the basis of the information certified under this
division, the tax commissioner annually shall submit a report to
the governor, the speaker of the house of representatives, the
president of the senate, and the chairpersons of the ways and
means committees of the respective houses of the general
assembly, indicating for each enterprise zone the amount of state
and local taxes that were not required to be paid because of
exemptions granted under agreements entered into under section
5709.62, 5709.63, or 5709.632 of the Revised Code and the amount
of additional taxes paid from the payroll of new employees.
Section 2. That existing sections 1724.05, 1724.06, 1726.11, 1726.12, 5709.67,
and 5709.68 of the Revised Code are
hereby repealed.
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