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Timber Talk 12/30/13

Posted By John Dorka, Monday, December 30, 2013

Ohio Statehouse News
The legislature continues out of session for the holiday break. However some brief information continues to come out of the statehouse.

More Tax Cuts? - Word from the Kasich Administration this past week is that the governor wants to continue work on lowering income taxes, and the upcoming "mid-biennium” budget review, a regular piece of legislation action in off-budget years, may well include more plans to reduce personal income taxes. The current biennium budget already includes a 10% reduction in income taxes over the next 3 years. Tax Commissioner Joe Testa has indicated that the administration is working on another proposal to reduce income taxes and he hopes it will be ready for inclusion in the Mid-Biennium Review. He indicated that there is a strong possibility that the tax cuts could be offset at least partially by an increase in oil and gas severance taxes.

Internet Sales Tax - Along the line of tax issues, the U.S. Supreme Court recently declined to hear’s appeal of the New York law requiring that the company collect sales taxes on New York on-line purchases. Following that ruling, Governor Kasich has indicated that, even after vetoing a similar provision in the last biennium budget due to potential litigation issues, he thinks Ohio needs to look at this as a matter of fairness for the state’s "brick and mortar” retail businesses. He recently told the Ohio Chamber of Commerce that Ohio the issue should be pursued by Congress at the federal level as it involves interstate commerce. The Department of Taxations estimates that on-line transactions could raise $274 million in tax collection in fiscal year 2015 and $345 million in 2016. The U.S. Senate passed the Marketplace Fairness Act in May of 2013 which would allow sales tax collections. Both Senators Rob Portman and Sherrod Brown voted for the legislation. The bill is now under consideration in the House.

Minimum Wage Increases January 1 - An estimated 330,000 Ohio wage earners will get a 10-cent bump in their hourly wages starting January 1. Minimum wage will jump to $7.95 per hour based on an annual rate of inflation for the year and mandated by a Constitutional Amendment that was passed in 2006. The increase is mandated for businesses with gross annual receipts exceeding $292,000 per year. Companies under this threshold will pay a federal minimum wage of $7.25 per hour.

Plan to Pay Down Unemployment Debt to Federal Government - Some House Republicans want to use the savings from the Medicaid expansion to help pay down the state’s unemployment compensation debt to the federal government, which would help save employers increasingly higher taxes to pay off the loan. The expansion saved the state about $404 million, and Rep. Dave Hall (R-Millersburg) has introduced a bill requiring these savings to go toward reducing the unemployment compensation trust fund debt. There are, however, several other ideas for use of the money, including more state income tax savings and reinstating some of the funding to local governments lost in the last budget.

House Leadership - We will soon be into election year which in itself will bring changes in Columbus and Washington. Among the questions in the Ohio Statehouse will be the new leadership once elections are complete. Republicans hope to continue the hold on both chambers of the legislature as well maintain the governor’s office. Already being talked about is who the new Speaker of the House will be with continue Republican dominance in the House. One person who may have an inside track is Rep. Cliff Rosenberger (R-Clarksville) in southwest Ohio. Some may recall that Rep. Rosenberger was key in helping to get changes in Ohio’s commercial truck law favoring forest product haulers. Here is an article from the Cincinnati Enquirer that talks about his potential run at House leadership. Currently, Rep. Bill Batchelder (R-Medina) is the House Speaker and an elder statesman in Ohio’s legislature. He is term limited and cannot run again for re-election.

Ohio Power Siting Board Sees Spike in Plans for New Gas-Fired Power Plants, Wind Farms, and Transmission Line Projects - State utility regulators say that 2013 saw a rash of requests to permit new energy projects in Ohio as a result of the ongoing retirements of several large-scale, aging coal fired plants and the overhaul of transmission lines to compensate for the decrease in base load generation within the state . The Board approved a proposal for a new gas-fired plant in Oregon (799 MW) while it received an application for a new similar facility in Carroll County (700 MW). It also approved a plan to increase the capacity for an existing gas-fired plant in Wilkesville from 860 MW to 1,414 MW. These are the first new large scale generation facilities to be built in Ohio in more than a decade. The Board also approved two new wind farms in Ohio, a 100 MW farm in Paulding County with up to 59 wind turbines covering an area of 12,750 acres and another in Champaign County for 140 MW production on 13,500 acres. Meanwhile, the Ohio Supreme Court recently cleared the way for a new wind farm covering 24,000 acres in Crawford and Richland Counties. The Board is still reviewing 5 projects and expects to receive 3 more in the near future. Increasingly stringent federal environmental regulations and the low price of gas has resulted in the shutdown of dozens of power plants in Ohio and surrounding states and dozens more will be shut down in the next several years. As a result there has been massive need to upgrade and revamp the transmission grid and over the last 2 years, the Board has received more than 100 transmission project applications. The projects will involve the installation of new lines and substations, and rebuild, expand, relocate and upgrade existing facilities.

2014 OFA Annual Meeting, March 5-6, Columbus Sheraton Hotel on Capitol Square#
Staff is finalizing plans. Watch for registration information and details coming soon. Anyone interested in sponsoring or exhibiting can contact Gayla at the OFA Office.

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