To amend sections 5735.01, 5735.012, 5739.025, 5747.98, and 5751.98 and to enact sections 122.079, 5735.015, 5735.016, 5747.78, and 5751.55 of the Revised Code to create the Gaseous Fuel Vehicle Conversion Program, to allow a credit against the income or commercial activity tax for the purchase or conversion of an alternative fuel vehicle, to reduce the amount of sales tax due on the purchase or lease of a qualifying electric vehicle by up to $500, to apply the motor fuel tax to the distribution or sale of compressed natural gas, to authorize a temporary, partial motor fuel tax exemption for sales of compressed natural gas used as motor fuel, and to make an appropriation.

Section 1.  That sections 5735.01, 5735.012, 5739.025, 5747.98, and 5751.98 be amended and sections 122.079, 5735.015, 5735.016, 5747.78, and 5751.55 of the Revised Code be enacted to read as follows:

Sec. 122.079.  (A) As used in this section:

(1) "Compressed natural gas" means a clear, odorless, and noncorrosive natural gas that is compressed to a pressure of at least three thousand eight hundred pounds per square inch but less than four thousand five hundred pounds per square inch.

(2) "Gaseous fuel" means compressed natural gas, liquefied natural gas, or liquid petroleum gas.

(3) "Incremental cost" means the excess cost associated with the purchase of a vehicle originally equipped by the manufacturer to operate on gaseous fuel as compared to the purchase of an equivalent vehicle that operates on gasoline or diesel fuel.

(4) "Liquefied natural gas" means natural gas that is cooled to negative two hundred sixty degrees fahrenheit and is in a liquefied state.

(5) "Liquid petroleum gas" means a material with a vapor pressure not exceeding that of commercial propane which is composed predominately of the following hydrocarbons or mixtures: propane, propylene, butane (normal butane or isobutane), and butylene.

(6) "Nonprofit corporation" has the same meaning as in section 1702.01 of the Revised Code.

(7) "Public transportation system" means a county transit system operated in accordance with sections 306.01 to 306.13 of the Revised Code, a regional transit authority operated in accordance with sections 306.30 to 306.71 of the Revised Code, or a regional transit commission operated in accordance with sections 306.80 to 306.90 of the Revised Code.

(8) "School district" means a "city school district" as defined in section 3311.02 of the Revised Code, a "local school district" as defined in section 3311.03 of the Revised Code, an "exempted village school district" as defined in section 3311.04 of the Revised Code, or a "joint vocational school district" as defined in section 3311.18 of the Revised Code.

(B) For the purpose of promoting the conversion of public fleets to operate on cleaner fuels, the director of environmental protection shall administer a gaseous fuel vehicle conversion program under which the director may make grants to a state agency, a political subdivision of the state, a school district, a public transportation system, or a nonprofit corporation for the conversion of a vehicle to operate on gaseous fuel or for the incremental cost associated with the purchase of a vehicle originally equipped by the manufacturer to operate on gaseous fuel.

(C) The director shall adopt rules in accordance with Chapter 119. of the Revised Code that are necessary for the administration of the gaseous fuel vehicle conversion program. The rules shall establish all of the following:

(1) An application form and procedures governing the process for applying to receive a grant under the program;

(2) Grant eligibility requirements;

(3) A maximum grant amount of five hundred thousand dollars per eligible entity;

(4) Any other procedures, criteria, or grant terms that the director determines necessary to administer the program.

(D) There is hereby created in the state treasury the gaseous fuel vehicle conversion fund, which shall consist of money transferred to the fund by the general assembly. The money in the fund shall be used solely to make grants under the gaseous fuel vehicle conversion program. Any interest earned from money in the fund shall be used to administer the gaseous fuel vehicle conversion program.

Sec. 5735.01.  As used in this chapter:

(A) "Motor vehicles" includes all vehicles, vessels, watercraft, engines, machines, or mechanical contrivances which are powered by internal combustion engines or motors.

(B) "Motor fuel" means compressed natural gas and any liquid motor fuel, including, but not limited to, gasoline, diesel fuel, K-1 kerosene, or any other liquid motor fuel, including, but not limited to, liquid petroleum gas, or liquid natural gas, but excluding substances prepackaged and sold in containers of five gallons or less.

(C) "K-1 Kerosene kerosene" means fuel that conforms to the chemical and physical standards for kerosene no. 1-K as set forth in the american American society for testing and materials (ASTM) designated D-3699 "standard for specification for kerosene," as that standard may be modified from time to time. For purposes of inspection and testing, laboratory analysis shall be conducted using methods recognized by the ASTM designation D-3699.

(D) "Diesel fuel" means any liquid fuel capable of use in discrete form or as a blend component in the operation of engines of the diesel type, including transmix when mixed with diesel fuel.

(E) "Gasoline" means any of the following:

(1) All products, commonly or commercially known or sold as gasoline;

(2) Any blend stocks or additives, including alcohol, that are sold for blending with gasoline, other than products typically sold in containers of five gallons or less;

(3) Transmix when mixed with gasoline, unless certified, as required by the tax commissioner, for withdrawal from terminals for reprocessing at refineries;

(4) Alcohol that is offered for sale or sold for use as, or commonly and commercially used as, a fuel for internal combustion engines.

Gasoline does not include diesel fuel, commercial or industrial napthas or solvents manufactured, imported, received, stored, distributed, sold, or used exclusively for purposes other than as a motor fuel for a motor vehicle or vessel. The blending of any of the products listed in the preceding sentence, regardless of name or characteristics, is conclusively presumed to have been done to produce gasoline, unless the product obtained by the blending is entirely incapable for use as fuel to operate a motor vehicle. An additive, blend stock, or alcohol is presumed to be sold for blending unless a certification is obtained as required by the tax commissioner.

(F) "Public highways" means lands and lots over which the public, either as user or owner, generally has a right to pass, even though the same are closed temporarily by the authorities for the purpose of construction, reconstruction, maintenance, or repair.

(G) "Waters within the boundaries of this state" means all streams, lakes, ponds, marshes, water courses, and all other bodies of surface water, natural or artificial, which are situated wholly or partially within this state or within its jurisdiction, except private impounded bodies of water.

(H) "Person" includes individuals, partnerships, firms, associations, corporations, receivers, trustees in bankruptcy, estates, joint-stock companies, joint ventures, the state and its political subdivisions, and any combination of persons of any form.

(I)(1) "Motor fuel dealer" means any person who satisfies any of the following:

(a) The person imports from another state or foreign country or acquires motor fuel by any means into a terminal in this state;

(b) The person imports motor fuel from another state or foreign country in bulk lot vehicles for subsequent sale and distribution in this state from bulk lot vehicles;

(c) The person refines motor fuel in this state;

(d) The person acquires motor fuel from a motor fuel dealer for subsequent sale and distribution by that person in this state from bulk lot vehicles;

(e) The person possesses an unrevoked permissive motor fuel dealer's license.

(2) Any person who obtains dyed diesel fuel for use other than the operation of motor vehicles upon the public highways or upon waters within the boundaries of this state, but later uses that motor fuel for the operation of motor vehicles upon the public highways or upon waters within the boundaries of this state, is deemed a motor fuel dealer as regards any unpaid motor fuel taxes levied on the motor fuel so used.

(J) As used in sections 5735.05, 5735.25, 5735.29, and 5735.30 of the Revised Code only:

(1) With respect to gasoline, "received" or "receipt" shall be construed as follows:

(a) Gasoline produced at a refinery in this state or delivered to a terminal in this state is deemed received when it is disbursed through a loading rack at that refinery or terminal;

(b) Except as provided in division (J)(1)(a) of this section, gasoline imported into this state or purchased or otherwise acquired in this state by any person is deemed received within this state by that person when the gasoline is withdrawn from the container in which it was transported;

(c) Gasoline delivered or disbursed by any means from a terminal directly to another terminal is not deemed received.

(2) With respect to motor fuel other than gasoline, "received" or "receipt" means distributed or sold for use or used to generate power for the operation of motor vehicles upon the public highways or upon waters within the boundaries of this state. All diesel fuel that is not dyed diesel fuel, regardless of its use, shall be considered as used to generate power for the operation of motor vehicles upon the public highways or upon waters within the boundaries of this state when the fuel is sold or distributed to a person other than a licensed motor fuel dealer or to a person licensed under section 5735.026 of the Revised Code.

(K) Motor fuel used for the operation of licensed motor vehicles employed in the maintenance, construction, or repair of public highways is deemed to be used for the operation of motor vehicles upon the public highways.

(L) "Licensed motor fuel dealer" means any dealer possessing an unrevoked motor fuel dealer's license issued by the tax commissioner as provided in section 5735.02 of the Revised Code.

(M) "Licensed retail dealer" means any retail dealer possessing an unrevoked retail dealer's license issued by the tax commissioner as provided in section 5735.022 of the Revised Code.

(N) "Cents per gallon rate" means the amount computed by the tax commissioner under section 5735.011 of the Revised Code that is used to determine that portion of the tax levied by section 5735.05 of the Revised Code that is computed in the manner prescribed by division (B)(2) of section 5735.06 of the Revised Code and that is applicable for the period that begins on the first day of July following the date on which the commissioner makes the computation.

(O) "Retail dealer" means any person that sells or distributes motor fuel at a retail service station located in this state.

(P) "Retail service station" means a location from which motor fuel is sold to the general public and is dispensed or pumped directly into motor vehicle fuel tanks for consumption.

(Q) "Transit bus" means a motor vehicle that is operated for public transit or paratransit service on a regular and continuing basis within the state by or for a county, a municipal corporation, a county transit board pursuant to sections 306.01 to 306.13 of the Revised Code, a regional transit authority pursuant to sections 306.30 to 306.54 of the Revised Code, or a regional transit commission pursuant to sections 306.80 to 306.90 of the Revised Code. Public transit or paratransit service may include fixed route, demand-responsive, or subscription bus service transportation, but does not include shared-ride taxi service, carpools, vanpools, jitney service, school bus transportation, or charter or sightseeing services.

(R) "Export" means motor fuel delivered outside this state. Motor fuel delivered outside this state by or for the seller constitutes an export by the seller. Motor fuel delivered outside this state by or for the purchaser constitutes an export by the purchaser.

(S) "Import" means motor fuel delivered into this state from outside this state. Motor fuel delivered into this state from outside this state by or for the seller constitutes an import by the seller. Motor fuel delivered into this state from outside this state by or for the purchaser constitutes an import by the purchaser.

(T) "Terminal" means a motor fuel storage or distribution facility that is supplied by pipeline or marine vessel.

(U) "Consumer" means a buyer of motor fuel for purposes other than resale in any form.

(V) "Bulk lot vehicle" means railroad tank cars, transport tank trucks and tank wagons with a capacity of at least 1,400 gallons.

(W) "Licensed permissive motor fuel dealer" means any person possessing an unrevoked permissive motor fuel dealer's license issued by the tax commissioner under section 5735.021 of the Revised Code.

(X) "Licensed terminal operator" means any person possessing an unrevoked terminal operator's license issued by the tax commissioner under section 5735.026 of the Revised Code.

(Y) "Licensed exporter" means any person possessing an unrevoked exporter's license issued by the tax commissioner under section 5735.026 of the Revised Code.

(Z) "Dyed diesel fuel" means any diesel fuel dyed pursuant to regulations issued by the internal revenue service or a rule promulgated by the tax commissioner.

(AA) "Gross gallons" means U.S. gallons without temperature or barometric adjustments.

(BB) "Net gallons" means U.S. gallons with a temperature adjustment to sixty degrees fahrenheit.

Sec. 5735.012.  Amounts of liquid motor fuel reported under this chapter shall be measured in gross gallons, except that amounts reported for terminal to terminal transactions shall be measured in net gallons and amounts reported for terminal to Ohio licensed dealer transactions shall be measured in both net gallons and gross gallons. Amounts of compressed natural gas shall be measured in gallon equivalents as described in section 5735.015 of the Revised Code.

Sec. 5735.015.  For the purposes of this chapter, the following amount of compressed natural gas shall be the equivalent of one gallon of motor fuel:

(A) For compressed natural gas that is received through a dispenser capable of providing a measurement in pounds, five and sixty-six one-hundredths pounds of compressed natural gas;

(B) For compressed natural gas that is not received as provided in division (A) of this section, one hundred twenty-six and sixty-seven one-hundredths cubic feet of compressed natural gas, or the amount of compressed natural gas that has a lower heating value of one hundred fourteen thousand one hundred British thermal units.

Sec. 5735.016. (A) Notwithstanding any other provision of this chapter, the total combined rate of tax imposed under this chapter upon the receipt of compressed natural gas received on or after the first day of the first month after the effective date of the enactment of this section and before the first day of the sixty-first month after that effective date shall be the following:

(1) For compressed natural gas received on or after the first day of the first month after that effective date and before the first day of the thirty-seventh month after that effective date, seven cents per gallon;

(2) For compressed natural gas received on or after the first day of the thirty-seventh month after that effective date and before the first day of the sixty-first month after that effective date, fourteen cents per gallon.

(B) All receipts from taxes imposed at the rates described in division (A) of this section shall be distributed as follows:

(1) Seventeen twenty-eighths shall be distributed in the same manner as required for receipts from the tax levied by section 5735.05 of the Revised Code.

(2) Eight twenty-eighths shall be distributed in the same manner as required for receipts from the tax levied by section 5735.29 of the Revised Code.

(3) Two twenty-eighths shall be distributed in the same manner as required for receipts from the tax levied by section 5735.25 of the Revised Code.

(4) One twenty-eighth shall be distributed in the same manner as required for receipts from the tax levied by section 5735.30 of the Revised Code.

Sec. 5739.025.  As used in this section, "local tax" means a tax imposed pursuant to section 5739.021, 5739.023, 5739.026, 5741.021, 5741.022, or 5741.023 of the Revised Code.

(A) The taxes levied by sections 5739.02 and 5741.02 of the Revised Code shall be collected as follows:

(1) On and after July 1, 2003, and on or before June 30, 2005, in accordance with the following schedule:

If the price exceeds one dollar, the tax is six cents on each one dollar. If the price exceeds one dollar or a multiple thereof by not more than seventeen cents, the amount of tax is six cents for each one dollar plus one cent. If the price exceeds one dollar or a multiple thereof by more than seventeen cents, the amount of tax is six cents for each one dollar plus the amount of tax for prices eighteen cents through ninety-nine cents in accordance with the schedule above.

(2) On and after July 1, 2005, and on and before December 31, 2005, in accordance with the following schedule:

If the price exceeds two dollars, the tax is eleven cents on each two dollars. If the price exceeds two dollars or a multiple thereof by not more than eighteen cents, the amount of tax is eleven cents for each two dollars plus one cent. If the price exceeds two dollars or a multiple thereof by more than eighteen cents, the amount of tax is eleven cents for each two dollars plus the amount of tax for prices nineteen cents through one dollar and ninety-nine cents in accordance with the schedule above.

(B) On and after July 1, 2003, and on and before June 30, 2005, the combined taxes levied by sections 5739.02 and 5741.02 and pursuant to sections 5739.021, 5739.023, 5739.026, 5741.021, 5741.022, and 5741.023 of the Revised Code shall be collected in accordance with the following schedules:

(1) When the combined rate of state and local tax is six and one-fourth per cent:

If the price exceeds four dollars, the tax is twenty-five cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than sixteen cents, the amount of tax is twenty-five cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than sixteen cents, the amount of tax is twenty-five cents for each four dollars plus the amount of tax for prices seventeen cents through three dollars and ninety-nine cents in accordance with the schedule above.

(2) When the combined rate of state and local tax is six and one-half per cent:

If the price exceeds two dollars, the tax is thirteen cents on each two dollars. If the price exceeds two dollars or a multiple thereof by not more than fifteen cents, the amount of tax is thirteen cents for each two dollars plus one cent. If the price exceeds two dollars or a multiple thereof by more than fifteen cents, the amount of tax is thirteen cents for each two dollars plus the amount of tax for prices sixteen cents through one dollar and ninety-nine cents in accordance with the schedule above.

(3) When the combined rate of state and local tax is six and three-fourths per cent:

If the price exceeds four dollars, the tax is twenty-seven cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than fourteen cents, the amount of tax is twenty-seven cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than fourteen but by not more than twenty-nine cents, the amount of tax is twenty-seven cents for each four dollars plus two cents. If the price exceeds four dollars or a multiple thereof by more than twenty-nine cents the amount of tax is twenty-seven cents for each four dollars plus the amount of tax for prices thirty cents through three dollars and ninety-nine cents in accordance with the schedule above.

(4) When the combined rate of state and local tax is seven per cent:

If the price exceeds one dollar, the tax is seven cents on each one dollar. If the price exceeds one dollar or a multiple thereof by not more than fifteen cents, the amount of tax is seven cents for each one dollar plus one cent. If the price exceeds one dollar or a multiple thereof by more than fifteen cents, the amount of tax is seven cents for each one dollar plus the amount of tax for prices sixteen cents through ninety-nine cents in accordance with the schedule above.

(5) When the combined rate of state and local tax is seven and one-fourth per cent:

If the price exceeds four dollars, the tax is twenty-nine cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than thirteen cents, the amount of tax is twenty-nine cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than thirteen cents but by not more than twenty-seven cents, the amount of tax is twenty-nine cents for each four dollars plus two cents. If the price exceeds four dollars or a multiple thereof by more than twenty-seven cents, the amount of tax is twenty-nine cents for each four dollars plus the amount of tax for prices twenty-eight cents through three dollars and ninety-nine cents in accordance with the schedule above.

(6) When the combined rate of state and local tax is seven and one-half per cent:

If the price exceeds two dollars, the tax is fifteen cents on each two dollars. If the price exceeds two dollars or a multiple thereof by not more than fifteen cents, the amount of tax is fifteen cents for each two dollars plus one cent. If the price exceeds two dollars or a multiple thereof by more than fifteen cents, the amount of tax is fifteen cents for each two dollars plus the amount of tax for prices sixteen cents through one dollar and ninety-nine cents in accordance with the schedule above.

(7) When the combined rate of state and local tax is seven and three-fourths per cent:

If the price exceeds four dollars, the tax is thirty-one cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than twelve cents, the amount of tax is thirty-one cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than twelve cents but by not more than twenty-five cents, the amount of tax is thirty-one cents for each four dollars plus two cents. If the price exceeds four dollars or a multiple thereof by more than twenty-five cents, the amount of tax is thirty-one cents for each four dollars plus the amount of tax for prices twenty-six cents through three dollars and ninety-nine cents in accordance with the schedule above.

(8) When the combined rate of state and local tax is eight per cent:

If the price exceeds one dollar, the tax is eight cents on each one dollar. If the price exceeds one dollar or a multiple thereof by not more than twelve cents, the amount of tax is eight cents for each one dollar plus one cent. If the price exceeds one dollar or a multiple thereof by more than twelve cents but not more than twenty-five cents, the amount of tax is eight cents for each one dollar plus two cents. If the price exceeds one dollar or a multiple thereof by more than twenty-five cents, the amount of tax is eight cents for each one dollar plus the amount of tax for prices twenty-six cents through ninety-nine cents in accordance with the schedule above.

(9) When the combined rate of state and local tax is eight and one-fourth per cent:

If the price exceeds four dollars, the tax is thirty-three cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than eleven cents, the amount of tax is thirty-three cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than eleven cents but by not more than twenty-four cents, the amount of tax is thirty-three cents for each four dollars plus two cents. If the price exceeds four dollars or a multiple thereof by more than twenty-four cents, the amount of tax is thirty-three cents for each four dollars plus the amount of tax for prices twenty-six cents through three dollars and ninety-nine cents in accordance with the schedule above.

(10) When the combined rate of state and local tax is eight and one-half per cent:

If the price exceeds two dollars, the tax is seventeen cents on each two dollars. If the price exceeds two dollars or a multiple thereof by not more than eleven cents, the amount of tax is seventeen cents for each two dollars plus one cent. If the price exceeds two dollars or a multiple thereof by more than eleven cents but by not more than twenty-three cents, the amount of tax is seventeen cents for each two dollars plus two cents. If the price exceeds two dollars or a multiple thereof by more than twenty-three cents, the amount of tax is seventeen cents for each two dollars plus the amount of tax for prices twenty-four cents through one dollar and ninety-nine cents in accordance with the schedule above.

(11) When the combined rate of state and local tax is eight and three-fourths per cent:

If the price exceeds four dollars, the tax is thirty-five cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than eleven cents, the amount of tax is thirty-five cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than eleven cents but by not more than twenty-two cents, the amount of tax is thirty-five cents for each four dollars plus two cents. If the price exceeds four dollars or a multiple thereof by more than twenty-two cents, the amount of tax is thirty-five cents for each four dollars plus the amount of tax for prices twenty-three cents through three dollars and ninety-nine cents in accordance with the schedule above.

(12) When the combined rate of state and local tax is nine per cent:

If the price exceeds one dollar, the tax is nine cents on each one dollar. If the price exceeds one dollar or a multiple thereof by not more than eleven cents, the amount of tax is nine cents for each one dollar plus one cent. If the price exceeds one dollar or a multiple thereof by more than eleven cents but by not more than twenty-two cents, the amount of tax is nine cents for each one dollar plus two cents. If the price exceeds one dollar or a multiple thereof by more than twenty-two cents, the amount of tax is nine cents for each one dollar plus the amount of tax for prices twenty-three cents through ninety-nine cents in accordance with the schedule above.

(C) On and after July 1, 2005, and on and before December 31, 2005, the combined taxes levied by sections 5739.02 and 5741.02 and pursuant to sections 5739.021, 5739.023, 5739.026, 5741.021, 5741.022, and 5741.023 of the Revised Code shall be collected in accordance with the following schedules:

(1) When the total rate of local tax is one-fourth per cent:

If the price exceeds four dollars, the tax is twenty-three cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than seventeen cents, the amount of tax is twenty-three cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than seventeen cents, the amount of tax is twenty-three cents for each four dollars plus the amount of tax for prices eighteen cents through three dollars and ninety-nine cents in accordance with the schedule above.

(2) When the combined rate of local tax is one-half per cent:

If the price exceeds one dollar, the tax is six cents on each one dollar. If the price exceeds one dollar or a multiple thereof by not more than seventeen cents, the amount of tax is six cents for each one dollar plus one cent. If the price exceeds one dollar or a multiple thereof by more than seventeen cents, the amount of tax is six cents for each one dollar plus the amount of tax for prices eighteen cents through ninety-nine cents in accordance with the schedule above.

(3) When the combined rate of local tax is three-fourths per cent:

If the price exceeds four dollars, the tax is twenty-five cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than sixteen cents, the amount of tax is twenty-five cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than sixteen cents, the amount of tax is twenty-five cents for each four dollars plus the amount of tax for prices seventeen cents through three dollars and ninety-nine cents in accordance with the schedule above.

(4) When the combined rate of local tax is one per cent:

If the price exceeds two dollars, the tax is thirteen cents on each two dollars. If the price exceeds two dollars or a multiple thereof by not more than fifteen cents, the amount of tax is thirteen cents for each two dollars plus one cent. If the price exceeds two dollars or a multiple thereof by more than fifteen cents, the amount of tax is thirteen cents for each two dollars plus the amount of tax for prices sixteen cents through one dollar and ninety-nine cents in accordance with the schedule above.

(5) When the combined rate of local tax is one and one-fourth per cent:

If the price exceeds four dollars, the tax is twenty-seven cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than fourteen cents, the amount of tax is twenty-seven cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than fourteen but by not more than twenty-nine cents, the amount of tax is twenty-seven cents for each four dollars plus two cents. If the price exceeds four dollars or a multiple thereof by more than twenty-nine cents the amount of tax is twenty-seven cents for each four dollars plus the amount of tax for prices thirty cents through three dollars and ninety-nine cents in accordance with the schedule above.

(6) When the combined rate of local tax is one and one-half per cent:

If the price exceeds one dollar, the tax is seven cents on each one dollar. If the price exceeds one dollar or a multiple thereof by not more than fifteen cents, the amount of tax is seven cents for each one dollar plus one cent. If the price exceeds one dollar or a multiple thereof by more than fifteen cents, the amount of tax is seven cents for each one dollar plus the amount of tax for prices sixteen cents through ninety-nine cents in accordance with the schedule above.

(7) When the combined rate of local tax is one and three-fourths per cent:

If the price exceeds four dollars, the tax is twenty-nine cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than thirteen cents, the amount of tax is twenty-nine cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than thirteen cents but by not more than twenty-seven cents, the amount of tax is twenty-nine cents for each four dollars plus two cents. If the price exceeds four dollars or a multiple thereof by more than twenty-seven cents, the amount of tax is twenty-nine cents for each four dollars plus the amount of tax for prices twenty-eight cents through three dollars and ninety-nine cents in accordance with the schedule above.

(8) When the combined rate of local tax is two per cent:

If the price exceeds two dollars, the tax is fifteen cents on each two dollars. If the price exceeds two dollars or a multiple thereof by not more than fifteen cents, the amount of tax is fifteen cents for each two dollars plus one cent. If the price exceeds two dollars or a multiple thereof by more than fifteen cents, the amount of tax is fifteen cents for each two dollars plus the amount of tax for prices sixteen cents through one dollar and ninety-nine cents in accordance with the schedule above.

(9) When the combined rate of local tax is two and one-fourth per cent:

If the price exceeds four dollars, the tax is thirty-one cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than twelve cents, the amount of tax is thirty-one cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than twelve cents but not more than twenty-five cents, the amount of tax is thirty-one cents for each four dollars plus two cents. If the price exceeds four dollars or a multiple thereof by more than twenty-five cents, the amount of tax is thirty-one cents for each four dollars plus the amount of tax for prices twenty-six cents through three dollars and ninety-nine cents in accordance with the schedule above.

(10) When the combined rate of local tax is two and one-half per cent:

If the price exceeds one dollar, the tax is eight cents on each one dollar. If the price exceeds one dollar or a multiple thereof by not more than twelve cents, the amount of tax is eight cents for each one dollar plus one cent. If the price exceeds one dollar or a multiple thereof by more than twelve cents but not more than twenty-five cents, the amount of tax is eight cents for each one dollar plus two cents. If the price exceeds one dollar or a multiple thereof by more than twenty-five cents, the amount of tax is eight cents for each one dollar plus the amount of tax for prices twenty-six cents through ninety-nine cents in accordance with the schedule above.

(11) When the combined rate of local tax is two and three-fourths per cent:

If the price exceeds four dollars, the tax is thirty-three cents on each four dollars. If the price exceeds four dollars or a multiple thereof by not more than eleven cents, the amount of tax is thirty-three cents for each four dollars plus one cent. If the price exceeds four dollars or a multiple thereof by more than eleven cents but not more than twenty-four cents, the amount of tax is thirty-three cents for each four dollars plus two cents. If the price exceeds four dollars or a multiple thereof by more than twenty-four cents, the amount of tax is thirty-three cents for each four dollars plus the amount of tax for prices twenty-six cents through three dollars and ninety-nine cents in accordance with the schedule above.

(12) When the combined rate of local tax is three per cent:

If the price exceeds two dollars, the tax is seventeen cents on each two dollars. If the price exceeds two dollars or a multiple thereof by not more than eleven cents, the amount of tax is seventeen cents for each two dollars plus one cent. If the price exceeds two dollars or a multiple thereof by more than eleven cents but not more than twenty-three cents, the amount of tax is seventeen cents for each two dollars plus two cents. If the price exceeds two dollars or a multiple thereof by more than twenty-three cents, the amount of tax is seventeen cents for each two dollars plus the amount of tax for prices twenty-four cents through one dollar and ninety-nine cents in accordance with the schedule above.

(D) In lieu of collecting the tax pursuant to the schedules set forth in divisions (A), (B), and (C) of this section, a vendor may compute the tax on each sale as follows:

(1) On sales of fifteen cents or less, no tax shall apply.

(2) On sales in excess of fifteen cents, multiply the price by the aggregate rate of taxes in effect under sections 5739.02 and 5741.02 and sections 5739.021, 5739.023, 5739.026, 5741.021, 5741.022, and 5741.023 of the Revised Code. The computation shall be carried out to six decimal places. If the result is a fractional amount of a cent, the calculated tax shall be increased to the next highest cent and that amount shall be collected by the vendor.

(E) On and after January 1, 2006, a vendor shall compute the tax on each sale by multiplying the price by the aggregate rate of taxes in effect under sections 5739.02 and 5741.02, and sections 5739.021, 5739.023, 5739.026, 5741.021, 5741.022, and 5741.023 of the Revised Code. The computation shall be carried out to three decimal places. If the result is a fractional amount of a cent, the calculated tax shall be rounded to a whole cent using a method that rounds up to the next cent whenever the third decimal place is greater than four. A vendor may elect to compute the tax due on a transaction on an item or an invoice basis.

(F) In auditing a vendor, the tax commissioner shall consider the method prescribed by this section that was used by the vendor in determining and collecting the tax due under this chapter on taxable transactions. If the vendor correctly collects and remits the tax due under this chapter in accordance with the schedules in divisions (A), (B), and (C) of this section or in accordance with the computation prescribed in division (D) or (E) of this section, the commissioner shall not assess any additional tax on those transactions.

(G)(1) With respect to a sale of a fractional ownership program aircraft used primarily in a fractional aircraft ownership program, including all accessories attached to such aircraft, the tax shall be calculated pursuant to divisions (A) to (E) of this section, provided that the tax commissioner shall modify those calculations so that the maximum tax on each program aircraft is eight hundred dollars. In the case of a sale of a fractional interest that is less than one hundred per cent of the program aircraft, the tax charged on the transaction shall be eight hundred dollars multiplied by a fraction, the numerator of which is the percentage of ownership or possession in the aircraft being purchased in the transaction, and the denominator of which is one hundred per cent.

(2) Notwithstanding any other provision of law to the contrary, the tax calculated under division (G)(1) of this section and paid with respect to the sale of a fractional ownership program aircraft used primarily in a fractional aircraft ownership program shall be credited to the general revenue fund.

(H)(1) As used in this division, "qualified plug-in electric drive vehicle" means a four-wheeled vehicle that meets all of the following requirements:

(a) The manufacturer made the vehicle primarily for use on public streets, roads, and highways and the vehicle has not been modified from original manufacturer specifications.

(b) The vehicle has a maximum speed capability equal to or greater than fifty-five miles per hour.

(c) The vehicle is propelled to a significant extent by an electric motor that draws electricity from a battery that has a capacity of at least four kilowatt-hours and that is capable of being recharged from an external source of electricity.

(d) The vehicle is registered in this state for operation on public highways.

(e) The consumer purchased or leased the vehicle for personal use or for use in business and not for resale before January 1, 2015.

(f) The consumer purchased or leased the vehicle in accordance with any laws or regulations governing the purchase or lease of alternative fuel or electric vehicles applicable at the time of sale or lease.

(2)(a) Subject to the limitation in division (H)(2)(b) of this section, with respect to the sale or lease of a qualified plug-in electric drive vehicle, the amount of tax due under this section shall equal the amount of tax calculated pursuant to divisions (A) to (E) of this section subtracted by five hundred dollars, provided that if the result of that calculation is less than or equal to zero, no tax is due.

(b) If the consumer is an individual purchasing the vehicle primarily for personal use, the partial exemption provided in division (H)(2)(a) of this section applies to the purchase or lease of only one qualified plug-in electric drive vehicle by that individual in a calendar year. If the consumer is a business purchasing the vehicle for use in the business, the partial exemption applies to the purchase or lease of only ten qualified plug-in electric drive vehicles by that business in a calendar year.

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

(1) "Alternative fuel" means compressed natural gas, liquid natural gas, or liquid petroleum gas.

(2) "Alternative fuel vehicle" means a motor vehicle that is registered in this state for operation on public highways and that is propelled by a motor that runs on alternative fuel. "Alternative fuel vehicle" includes a bi-fueled or dual-fueled vehicle with a motor that can run on both alternative fuel and on gasoline or diesel fuel.

(3) "New alternative fuel vehicle" means an alternative fuel vehicle that meets all of the following criteria:

(a) The taxpayer purchased the vehicle from an original equipment manufacturer, automobile retailer, or after-market conversion facility.

(b) The taxpayer was the first person to purchase the vehicle for personal use or for use in business and not for resale.

(c) The alternative fuel technology used in the vehicle has received a compliance designation or been certified by the United States environmental protection agency for new or intermediate use.

(d) If the vehicle is propelled by a motor that runs on compressed natural gas, at least five years remain until the date established by the manufacturer of the compressed natural gas tank as the end-of-life date for the tank.

(4) "Traditional fuel vehicle" means a motor vehicle that is registered in this state for operation on public highways and that is propelled by gasoline or diesel fuel.

(5) "Adjusted purchase price" means the portion of the purchase price of a new alternative fuel vehicle that is attributable to the parts and equipment used for the storage of alternative fuel, the delivery of alternative fuel to the motor, and the exhaust of gases from the combustion of alternative fuel.

(6) "Conversion parts and equipment" shall not include parts and equipment that have previously been used to modify or retrofit another traditional fuel vehicle.

(B) A nonrefundable credit may be claimed against the tax imposed by section 5747.02 of the Revised Code by a taxpayer that, on or after the effective date of the enactment of this section and before the first day of the sixty-first month after that effective date, purchases a new alternative fuel vehicle or converts a traditional fuel vehicle into an alternative fuel vehicle. The amount of the credit shall equal the lesser of fifty per cent of the adjusted purchase price of the new alternative fuel vehicle or of the cost of the conversion parts and equipment, as applicable, or one of the following amounts:

(1) For the purchase or conversion of an alternative fuel vehicle with a gross vehicle rating of eight thousand five hundred pounds or less, five thousand dollars;

(2) For the purchase or conversion of an alternative fuel vehicle with a gross vehicle rating equal to or less than ten thousand pounds, but more than eight thousand five hundred pounds, ten thousand dollars;

(3) For the purchase or conversion of an alternative fuel vehicle with a gross vehicle rating of more than ten thousand pounds, twenty-five thousand dollars.

The taxpayer shall claim the credit for the taxable year in which the taxpayer purchases the new alternative fuel vehicle or the conversion parts and equipment.

(C) The taxpayer shall claim a credit allowed under this section in the order required by section 5747.98 of the Revised Code. The credit, to the extent it exceeds the taxpayer's tax liability for a taxable year after allowing for any other credits that precede the credit under that section, may be carried forward to the next succeeding taxable year or years, but the amount of the excess credit claimed for any taxable year shall be deducted from the balance carried forward to the next taxable year.

(D) Not more than one credit shall be allowed under this section or section 5751.55 of the Revised Code on the basis of the same alternative fuel vehicle or same conversion parts and equipment.

(E) A taxpayer that is an equity investor in a pass-through entity that purchases a new alternative fuel vehicle or converts a traditional fuel vehicle into an alternative fuel vehicle within the time period prescribed in division (B) of this section may claim the taxpayer's distributive or proportionate share of the credit for the taxpayer's taxable year that includes the last day of the entity's taxable year in which the vehicle or conversion parts and equipment were purchased.

(F) The tax commissioner may promulgate any rules necessary for the administration of this section.

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 nonrefundable 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 small business investment credit under section 5747.81 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 The nonrefundable credit for the purchase or conversion of an alternative fuel vehicle under section 5747.78 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 or job retention 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 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;

(38) The refundable motion picture production credit under section 5747.66 of the Revised Code.

(39) The refundable credit for financial institution taxes paid by a pass-through entity granted under section 5747.65 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. 5751.55.  (A) As used in this section, "alternative fuel," "alternative fuel vehicle," "new alternative fuel vehicle," "traditional fuel vehicle," "adjusted purchase price," and "conversion parts and equipment" have the same meanings as in section 5747.78 of the Revised Code.

(B) A nonrefundable credit may be claimed against the tax imposed by section 5751.02 of the Revised Code by a taxpayer that, on or after the effective date of the enactment of this section by this act and before the first day of the sixty-first month after that effective date, purchases a new alternative fuel vehicle or converts a traditional fuel vehicle into an alternative fuel vehicle. The amount of the credit shall equal the lesser of fifty per cent of the adjusted purchase price of the new alternative fuel vehicle or of the cost of the conversion parts and equipment, as applicable, or one of the following amounts:

(1) For the purchase or conversion of an alternative fuel vehicle with a gross vehicle rating of eight thousand five hundred pounds or less, five thousand dollars;

(2) For the purchase or conversion of an alternative fuel vehicle with a gross vehicle rating equal to or less than ten thousand pounds, but more than eight thousand five hundred pounds, ten thousand dollars;

(3) For the purchase or conversion of an alternative fuel vehicle with a gross vehicle rating of more than ten thousand pounds, twenty-five thousand dollars.

The taxpayer shall claim the credit for the tax period in which the taxpayer purchases the new alternative fuel vehicle or the conversion parts and equipment.

(C) The taxpayer shall claim a credit allowed under this section in the order required by section 5751.98 of the Revised Code. The credit, to the extent it exceeds the taxpayer's tax liability for a tax period after allowing for any other credits that precede the credit under that section, may be carried forward to the next succeeding tax period or periods, but the amount of the excess credit claimed for any tax period shall be deducted from the balance carried forward to the next tax period.

(D) Not more than one credit shall be allowed under this section or section 5747.78 of the Revised Code on the basis of the same alternative fuel vehicle or same conversion parts and equipment.

(E) The tax commissioner may promulgate any rules necessary for the administration of this section.

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 nonrefundable credit for the purchase or conversion of an alternative fuel vehicle under section 5751.55 of the Revised Code;

(6) The refundable motion picture production credit under section 5751.54 of the Revised Code;

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

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

(B) For any credit except the refundable credits enumerated in 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 5735.01, 5735.012, 5739.025, 5747.98, and 5751.98 of the Revised Code are hereby repealed.

Section 3.  The amendment or enactment by this act of sections 5735.01, 5735.012, 5735.015, and 5739.025 of the Revised Code applies on and after the first day of the first month after the effective date of this act.

Section 4.  All items in this section are hereby appropriated as designated out of any moneys in the state treasury to the credit of the designated fund. For all appropriations made in this act, those in the first column are for fiscal year 2014 and those in the second column are for fiscal year 2015. The appropriations made in this act are in addition to any other appropriations made for the FY 2014-FY 2015 biennium.

Appropriations

State Special Revenue Fund Group

GASEOUS FUEL VEHICLE CONVERSION PROGRAM

The foregoing appropriation item 715695, Gaseous Fuel Vehicle Conversion Program, shall be used to fund the gaseous fuel vehicle conversion program established in section 122.079 of the Revised Code.

It is the intent of the General Assembly to appropriate $16,000,000 in each fiscal year of the biennium ending June 30, 2017, and in the first fiscal year of the biennium ending June 30, 2019, for the Gaseous Fuel Vehicle Conversion Fund appropriation item 715695, Gaseous Fuel Vehicle Conversion Program, for the purposes of the program established in section 122.079 of the Revised Code.

Section 5.  TRANSFERS TO THE GASEOUS FUEL VEHICLE CONVERSION FUND

On the effective date of this section, or as soon as possible thereafter, the Director of Budget and Management shall transfer $16,000,000 cash from the General Revenue Fund to the Gaseous Fuel Vehicle Conversion Fund (Fund 5NP0).

On July 1, 2014, or as soon as possible thereafter, the Director of Budget and Management shall transfer $16,000,000 cash from the General Revenue Fund to Fund 5NP0.

Section 6.  Within the limits set forth in this act, the Director of Budget and Management shall establish accounts indicating the source and amount of funds for each appropriation made in this act, and shall determine the form and manner in which appropriation accounts shall be maintained. Expenditures from appropriations contained in this act shall be accounted for as though made in the main appropriations act of the 130th General Assembly.

The appropriations made in this act are subject to all provisions of the main appropriations act of the 130th General Assembly that are generally applicable to such appropriations.

Section 7.  Section 5747.98 of the Revised Code is presented in this act as a composite of the section as amended by both Am. Sub. H.B. 386 and Am. Sub. H.B. 510 of the 129th General Assembly. The General Assembly, applying the principle stated in division (B) of section 1.52 of the Revised Code that amendments are to be harmonized if reasonably capable of simultaneous operation, finds that the composite is the resulting version of the section in effect prior to the effective date of the section as presented in this act.