To amend sections 5747.98 and 5751.98 and to enact sections 3746.241, 5747.78, and 5751.54 of the Revised Code to authorize refundable tax credits through 2017 for the completion of a voluntary action to remediate a contaminated site and for the return of such sites to productive use, and to exempt persons through 2017 who have been issued covenants not to sue under the Voluntary Action Program from certain fees and penalties for one year after the issuance of such a covenant.

Section 1. That sections 5747.98 and 5751.98 be amended and sections 3746.241, 5747.78, and 5751.54 of the Revised Code be enacted to read as follows:

Sec. 3746.241. A person to which a covenant not to sue is issued under section 3746.12 of the Revised Code concerning a voluntary action that is initiated not later than December 31, 2017, is exempt from any fees or civil or administrative penalties that are authorized to be levied or imposed under any environmental law with respect to the property that is the subject of the covenant not to sue for a period of one year after the issuance of the covenant. The director of environmental protection shall adopt rules in accordance with Chapter 119. of the Revised Code that are necessary to implement this section.

For purposes of this section, a voluntary action is initiated upon the commencement of a phase I property assessment under this chapter.

As used in this section, "environmental law" means this chapter or Chapter 3704., 3734., 3745., 3750., 3751., 3752., 6109., or 6111. of the Revised Code or a rule adopted under any of those chapters.

Sec. 5747.78.  (A) As used in this section:

(1) "Voluntary action," "remedial activities," "property," and "covenant not to sue" have the same meanings as in section 3746.01 of the Revised Code.

(2) "Remediation expenditures" means expenditures that are made directly to conduct remedial activities on property that is the subject of a voluntary action for which a covenant not to sue has been issued under Chapter 3746. of the Revised Code. "Remediation expenditures" does not include expenditures for remedial activities derived from grants or other transfers of money from governmental entities to a taxpayer for which there is no repayment obligation.

(3) "Pass-through entity" includes a sole proprietorship.

(4) Property is used for a "productive use" if it is used by any person to conduct a trade or business or if a certificate of occupancy has been issued for the property by the local authority having jurisdiction to issue such a certificate and the property is suitable for the conduct of a trade or business. For the purposes of this division, the use of property to conduct a trade or business includes a pass-through entity leasing the property to lessees for commercial, industrial, or residential purposes.

(5) A voluntary action is "initiated" upon commencement of a phase I property assessment under Chapter 3746. of the Revised Code.

(B) There is allowed a refundable credit against the tax imposed by section 5747.02 of the Revised Code for a taxpayer that is an equity owner of a pass-through entity to which a covenant not to sue has been issued under Chapter 3746. of the Revised Code on or after the effective date of this section. The credit equals the taxpayer's distributive or proportionate share of twenty-five per cent of the remediation expenditures paid or incurred by the entity.

The credit shall be claimed for the taxpayer's taxable year that ends in the pass-through entity's taxable year in which the covenant not to sue was issued to the entity by the director of environmental protection. The credit may not be claimed for any remediation expenditures paid or incurred for a voluntary action initiated after December 31, 2017.

A taxpayer may claim a credit under this division for each voluntary action for which a separate covenant not to sue was issued to a pass-through entity of which the taxpayer is an equity owner.

(C) There is allowed an additional refundable credit against the tax imposed by section 5747.02 of the Revised Code for a taxpayer that qualifies for the credit under division (B) of this section if the property that was the subject of the covenant not to sue is used for a productive use. The credit equals the sum of twenty-five per cent of the remediation expenditures paid or incurred by the pass-through entity to which the covenant was issued. A credit may be claimed under this division regardless of whether a credit was claimed under division (B) of this section.

The credit shall be claimed for the taxpayer's taxable year that ends in the pass-through entity's taxable year in which the property is first used for a productive use after the covenant not to sue was issued. The credit may not be claimed for any remediation expenditures paid or incurred for a voluntary action initiated after December 31, 2017.

A taxpayer may claim a credit under this division for each property that is the subject of a voluntary action for which a separate covenant not to sue was issued to a pass-through entity of which the taxpayer is an equity owner. A taxpayer may not claim the credit allowed under this division more than once for each property for which a covenant not to sue was issued.

(D) The credits allowed by this section shall be claimed in the order prescribed by section 5747.98 of the Revised Code. If the amount of the credits exceeds the amount of tax otherwise due after deducting all other credits claimed in that order, the excess shall be refunded to the taxpayer.

(E) A credit may not be claimed under this section on the basis of a voluntary action on the basis of which a credit was claimed under section 5751.54 of the Revised Code.

Sec. 5747.98.  (A) To provide a uniform procedure for calculating the amount of tax due under section 5747.02 of the Revised Code, a taxpayer shall claim any credits to which the taxpayer is entitled in the following order:

(1) The retirement income credit under division (B) of section 5747.055 of the Revised Code;

(2) The senior citizen credit under division (C) of section 5747.05 of the Revised Code;

(3) The lump sum distribution credit under division (D) of section 5747.05 of the Revised Code;

(4) The dependent care credit under section 5747.054 of the Revised Code;

(5) The lump sum retirement income credit under division (C) of section 5747.055 of the Revised Code;

(6) The lump sum retirement income credit under division (D) of section 5747.055 of the Revised Code;

(7) The lump sum retirement income credit under division (E) of section 5747.055 of the Revised Code;

(8) The low-income credit under section 5747.056 of the Revised Code;

(9) The credit for displaced workers who pay for job training under section 5747.27 of the Revised Code;

(10) The campaign contribution credit under section 5747.29 of the Revised Code;

(11) The twenty-dollar personal exemption credit under section 5747.022 of the Revised Code;

(12) The joint filing credit under division (G) of section 5747.05 of the Revised Code;

(13) The nonresident credit under division (A) of section 5747.05 of the Revised Code;

(14) The credit for a resident's out-of-state income under division (B) of section 5747.05 of the Revised Code;

(15) The credit for employers that enter into agreements with child day-care centers under section 5747.34 of the Revised Code;

(16) The credit for employers that reimburse employee child care expenses under section 5747.36 of the Revised Code;

(17) The credit for adoption of a minor child under section 5747.37 of the Revised Code;

(18) The credit for purchases of lights and reflectors under section 5747.38 of the Revised Code;

(19) The job retention credit under division (B) of section 5747.058 of the Revised Code;

(20) The credit for selling alternative fuel under section 5747.77 of the Revised Code;

(21) The second credit for purchases of new manufacturing machinery and equipment and the credit for using Ohio coal under section 5747.31 of the Revised Code;

(22) The job training credit under section 5747.39 of the Revised Code;

(23) The enterprise zone credit under section 5709.66 of the Revised Code;

(24) The credit for the eligible costs associated with a voluntary action under section 5747.32 of the Revised Code;

(25) The credit for employers that establish on-site child day-care centers under section 5747.35 of the Revised Code;

(26) The ethanol plant investment credit under section 5747.75 of the Revised Code;

(27) The credit for purchases of qualifying grape production property under section 5747.28 of the Revised Code;

(28) The export sales credit under section 5747.057 of the Revised Code;

(29) The credit for research and development and technology transfer investors under section 5747.33 of the Revised Code;

(30) The enterprise zone credits under section 5709.65 of the Revised Code;

(31) The research and development credit under section 5747.331 of the Revised Code;

(32) The credit for rehabilitating a historic building under section 5747.76 of the Revised Code;

(33) The refundable credit for rehabilitating a historic building under section 5747.76 of the Revised Code;

(34) The refundable jobs creation credit under division (A) of section 5747.058 of the Revised Code;

(35) The refundable credit for taxes paid by a qualifying entity granted under section 5747.059 of the Revised Code;

(36) The refundable credits for taxes paid by a qualifying pass-through entity granted under division (J) of section 5747.08 of the Revised Code;

(37) The refundable credit for tax withheld under division (B)(1) of section 5747.062 of the Revised Code;

(38) The refundable credit for tax withheld under section 5747.063 of the Revised Code;

(39) The refundable credit under section 5747.80 of the Revised Code for losses on loans made to the Ohio venture capital program under sections 150.01 to 150.10 of the Revised Code;

(40) The refundable motion picture production credit under section 5747.66 of the Revised Code;

(41) The refundable credits for voluntary actions authorized under section 5747.78 of the Revised Code.

(B) For any credit, except the refundable credits enumerated in this section and the credit granted under division (I) of section 5747.08 of the Revised Code, the amount of the credit for a taxable year shall not exceed the tax due after allowing for any other credit that precedes it in the order required under this section. Any excess amount of a particular credit may be carried forward if authorized under the section creating that credit. Nothing in this chapter shall be construed to allow a taxpayer to claim, directly or indirectly, a credit more than once for a taxable year.

Sec. 5751.54.  (A) As used in this section:

(1) "Voluntary action," "remedial activities," "property," and "covenant not to sue" have the same meanings as in section 3746.01 of the Revised Code.

(2) "Remediation expenditures" means expenditures that are made directly to conduct remedial activities on property that is the subject of a voluntary action for which a covenant not to sue has been issued under Chapter 3746. of the Revised Code. "Remediation expenditures" does not include expenditures for remedial activities derived from grants or other transfers of money from governmental entities for which there is no repayment obligation.

(3) Property is used for a "productive use" if it is used by any person to conduct a trade or business or if a certificate of occupancy has been issued for the property by the local authority having jurisdiction to issue such a certificate and the property is suitable for the conduct of a trade or business. For the purposes of this division, the use of property to conduct a trade or business includes a taxpayer leasing the property to lessees for commercial, industrial, or residential purposes.

(4) A voluntary action is "initiated" upon commencement of a phase I property assessment under Chapter 3746. of the Revised Code.

(B) There is allowed a refundable credit against the tax imposed by this chapter for a taxpayer to which a covenant not to sue has been issued under Chapter 3746. of the Revised Code on or after the effective date of this section. The credit equals twenty-five per cent of the remediation expenditures paid or incurred by the taxpayer.

If the taxpayer is a calendar year taxpayer, the credit shall be claimed for the tax period that includes the day on which the covenant not to sue was issued to the taxpayer by the director of environmental protection. If the taxpayer is a calendar quarter taxpayer, one-fourth of the credit amount shall be claimed for the tax period that includes the day on which the covenant not to sue was issued and one-fourth of the credit amount shall be claimed in each of the three ensuing tax periods.

A taxpayer may claim a credit under this division for each voluntary action for which a covenant not to sue was issued to the taxpayer. The credit may not be claimed for any remediation expenditures paid or incurred for a voluntary action initiated after December 31, 2017.

(C) There is allowed an additional refundable credit against the tax imposed by this chapter for a taxpayer that qualifies for the credit under division (B) of this section if the property that was the subject of the covenant not to sue is owned by the taxpayer and the property is used for a productive use. The credit equals twenty-five per cent of the remediation expenditures paid or incurred by the taxpayer. A credit may be claimed under this division regardless of whether a credit was claimed under division (B) of this section.

If the taxpayer is a calendar year taxpayer, the credit shall be claimed for the tax period in which the property is first used for a productive use after the covenant not to sue was issued. If the taxpayer is a calendar quarter taxpayer, one-fourth of the credit amount shall be claimed for the tax period in which the property is first used for a productive use after the covenant not to sue was issued, and one-fourth of the credit amount shall be claimed in each of the three ensuing tax periods. The credit may not be claimed for any remediation expenditures paid or incurred for a voluntary action initiated after December 31, 2017.

A taxpayer may claim a credit under this division for each property that is the subject of a voluntary action for which a separate covenant not to sue was issued. The credit may not be claimed more than once for each property for which a covenant not to sue was issued.

(D) The credits allowed by this section shall be claimed in the order prescribed by section 5751.98 of the Revised Code. If the amount of the credits exceeds the amount of tax otherwise due after deducting all other credits claimed in that order, the excess shall be refunded to the taxpayer.

(E) A credit may not be claimed under this section on the basis of a voluntary action on the basis of which a credit was claimed under section 5747.78 of the Revised Code.

Sec. 5751.98.  (A) To provide a uniform procedure for calculating the amount of tax due under this chapter, a taxpayer shall claim any credits to which it is entitled in the following order:

(1) The nonrefundable jobs retention credit under division (B) of section 5751.50 of the Revised Code;

(2) The nonrefundable credit for qualified research expenses under division (B) of section 5751.51 of the Revised Code;

(3) The nonrefundable credit for a borrower's qualified research and development loan payments under division (B) of section 5751.52 of the Revised Code;

(4) The nonrefundable credit for calendar years 2010 to 2029 for unused net operating losses under division (B) of section 5751.53 of the Revised Code;

(5) The refundable credit for calendar year 2030 for unused net operating losses under division (C) of section 5751.53 of the Revised Code;

(6) The refundable jobs creation credit under division (A) of section 5751.50 of the Revised Code;

(7) The refundable credits for voluntary actions authorized under section 5751.54 of the Revised Code.

(B) For any credit except the credit refundable credits enumerated in division (A)(4) of this section, the amount of the credit for a tax period shall not exceed the tax due after allowing for any other credit that precedes it in the order required under this section. Any excess amount of a particular credit may be carried forward if authorized under the section creating the credit.

Section 2.  That existing sections 5747.98 and 5751.98 of the Revised Code are hereby repealed.