Posted By John Dorka,
Tuesday, February 12, 2013
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Weekly News 2.10.13
In this issue:
- 2013 OFA Annual Meeting - We continue to complete plans for the 2013 OFA Annual Meeting. All members should have received registration materials in the mail, but you can find the information you need as well as register on-line at the OFA website. With the Ohio legislative session getting into full gear, it should be a great time to meet with your elected representatives and help inform them about Ohio’s forest economy and forest products industry. There should also be some very good sessions talking about our industry and how things look down the road. A couple notes about the meeting:
- The tour of the Ohio Statehouse before the reception should be enlightening and enjoyable. We have arranged for 2 tours. You need to pre-register to participate on a tour as space is limited for both.
- The Ohio Tree Farm Committee will NOT hold a silent auction at the Annual Meeting this year. The Tree Farm Committee would like to pass along that it appreciates the generous support over the years of all who have donated items for auctions and helped make them so successful.
- Special discounted Hotel room rates for the meeting are guaranteed through February 12. After that date, special rates are offered only with room availability.
- There are still opportunities for sponsors and exhibitors to sign up!
- Administration Budget Overview Document - The biggest item to hit the legislature the first week of sessions is the State Budget. It was released on Monday and there was the first hearing on Tuesday, Feb. 5, during which OBM Director Tim Keen laid out details of the package for the biennium. The budget is always a huge document and covers all of state government for a 2-year period. You can read the Administration’s 20-page overview of the budget here. As a very brief summary, the Kasich Administration is proposing a number of key initiatives in this package. In essence, the primary focus is in 5 areas:
- Education improvement and reform
- Improving Ohio’s Health Care and Medicaid Program
- Tax Reform
- Higher Education Funding Reform
- Jobs and Transportation.
Following Governor Kasich’s initial comments on education funding reform, there was general optimism among many interests. However, once the individual district budget proposals were released, the optimism started to wane. Part of the problem is that although it was reported that no school district would receive less funding, the report shows that a number of wealthy districts will get sizable increases while more than 60% of rural districts will see no increases.
On another front, the Governor is urging the legislature to take a close look at many "loopholes” in the state tax laws from exemptions, deductions, and credits that will account for $7.7 billion in foregone revenue in FY 2014 and $8 billion in FY 2015. Sales tax exemptions make up the single largest foregone revenue source, totaling $5 billion in FY 2014. Income tax exemptions, deductions, and credits add up to $2 billion per year. The budget figures apparently do not contain any revenue projections from proposed "loophole” changes.
One of the more controversial parts of the plan includes an overall reduction in the state sales tax from 5.5% to 5% but with the addition of new sales taxes on 81 previously untaxed services. There will be a cut in state income taxes for individuals and small businesses amounting to an estimated $2 billion per year. Here is an article from Cincinnati.com that talks more about this part of the budget proposal.
- Timber Severance Tax NOT Part of Budget Package - It was reported last week that newspaper article out of Zanesville made a vague reference to timber in addition to oil and gas as part of the Governor’s budget proposal to increase severance taxes on these commodities. The budget package only addresses changes to the law affecting oil and gas production. It does not include timber.
- Ohio Transportation Budget - The Ohio Department of Transport presented its budget proposal to the legislature this past week. As per previous discussion about the Ohio Turnpike, the budget proposal included $1.5 billion of revenue from Ohio "Turnpike bonds”, with a "majority” of the money directed to northern Ohio projects. Earlier the governor had proposed dedicating "90%” of those bonds to northern Ohio but has elected not to dedicated a fixed amount to the northern part of the state (however that is defined). A number of both Republican and Democrat legislators from northern Ohio questioned the omission of the fixed percentage in the initial budget announcement. Among other provisions in the budget, there is a new fund with an estimated $140 million per year from Commercial Activity Taxes charged to motor fuel sales. Previously, some of those CAT funds were directed to non-highway uses and the Court ruled that was improper use of the funds. As a result, ODOT will have "additional” money for highway projects in the future.
- ODOT Proposal for State Highway Road Access Fee for Agricultural Purposes - A proposal that is part of the ODOT budget package is a provision that allows the Director to charge a one-time processing for a permit to access or occupy a state road or highway and specify that the fees do not exceed $30 for agricultural access, $70 for residential access, and $300 for commercial or industrial access. There are no details on this provision yet to see if and how it may apply to timber harvest or manufacturing operations. OFA will be following up on this.
- Ohio Chamber of Commerce Releases Policy Priorities - The Ohio Chamber of Commerce released its policy priorities for the 2013-2014 legislative session which you can read at the link. The nine priority areas include affordable energy, business costs, government mandates, government red tape, legal environment, state constitutional reform, tax climate, transforming government, and workforce excellence.
- OSU Cooperative Extension Wood Products Advisory Group - OFA hosted a meeting with a small group of wood industry members to offer Dr. Eric McConnell, OSU Extension Specialist for Forest Products and Operations, review of and advice on his program activities and priorities. Dr. McConnell presented the activities and projects he has been working on, which include among others, an updated analysis of Ohio’s Forest Economy, a study of Ohio’s historical timber prices, and a survey of Ohio’s logging community. The highlights of the report on Ohio’s Forest Economy was recently provided to OFA members as part of the information package in preparation for the Legislative Reception at the annual meeting. You can view the full Fact Sheet on the OSU website.
- Ohio EPA Pulls Small Stream Pollution Rules From Pending Regulations - Ohio EPA regulators are ready to release a revised version of water-pollution rules designed to clean up small streams. EPA had pulled controversial rules more than a year ago when industry groups, particularly from the coal and aggregates industries complained that they would be onerous to implement. The new version is expected to be non-controversial.
- Ohio 21st Century Manufacturing Task Force Report Released - This past week, Rep. Kirk Schuring (R-Canton, District 48), who chaired the Manufacturing Task Force released a report which included a set of recommendations that would improve Ohio’s manufacturing climate. The reportrecommendations are broken down into 12 categories including: workforce development; research and development; energy; transportation; workers' compensation; recycling; regulation; tax structure; trade; manufacturing clusters; outreach; and manufacturing's image. The report was based on information gathered from a series of 8 public hearings held in locations around Ohio to get feedback from manufacturers and other interested parties on recommendations to improve Ohio’s manufacturing climate. The Task Force was a bi-partisan group of House members including 5 Republicans and 4 Democrats. Chairman Schuring said he expected that a number of the recommendations would be addressed in legislation this session, but offered no specifics at this point. The report is filled with recommendation and it is worth a review. A few of the recommendations include keeping transportation costs low, review Ohio’s Workers Compensation program for improvements and fairness, encourage a uniform municipal tax policy, and work closer with Ohio colleges to promote manufacturing career opportunities.
Ohio Forestry Association is managed by Offinger Management Company, a member of the International Association of Exhibitions and Events (IAEE), "Charter-Accredited" Association Management Company member of the American Society of Association Executives (ASAE) and a member of the Association Management Company Institute (AMC Institute). www.Offinger.com
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