Ohio Municipal League Legislative Bulletin
OML HOME • Affiliates • Classifieds • Publications • About OML
Join the OML Legislative Bulletin E-Mail List
November 14th 2014
HB5 MUNICIPAL TAX REFORM BILL SCHEDULED FOR OPPONENT AND ALL PARTIES TESTIMONY NEXT WEEK
Chairman Peterson has announced OPPONENT TESTIMONY hearing has been scheduled for Tuesday, November 18, 3:30pm in the South Hearing Room. Also, there will be an All Parties hearing the following day, Wednesday November 19 at 3:30 p.m. also in the South Senate Hearing Room.
We do not anticipate additional committee hearings for individuals opposed to the current version of the municipal tax reform bill so next week will be the only two opportunities left to voice objections with legislators, share alternative proposals that would offer greater balance to the reform measure or voice other concerns related to the challenges municipalities face when providing services with reduced resources.
Brevity is always appreciated by committee members so try and target remarks to roughly 5 minutes in length. The senators will be most interested in the areas of the bill that will have the greatest impact on your community, how the revenue generated by the municipal income tax is used, business activity that is supported by individual municipalities through financial incentives or other financial incentive packages used by the city or village to enhance employment growth opportunities and what any projected revenue loss will mean in real world terms such as projects, equipment or safety force personnel that the community could better invest those dollars towards rather than being lost though tax cuts for special taxpayers.
We highly encourage those that can to testify. Chairman Peterson asks that those providing testimony to send an electronic copy of the prepared testimony to his office 24 hours before the committee meeting, so that copies can be made and included in committee member folders prior to the hearing. You can also send it to OML Director of Communications Kent Scarrett at firstname.lastname@example.org and he will deliver it to the senator's office. Just to clarify, if testimony is being provided at Tuesday's hearing, a written copy must be submitted by 5pm Monday and 5pm Tuesday if testimony will be provided Wednesday.
MUNICIPAL TAX REFORM SPONSORS AND PROPONENTS TESTIFY BEFORE SENATE COMMITTEE
As we reported in last week’s legislative bulletin, Am.Sub.HB5 was moved from the Senate Finance committee to the Senate Ways and Means committee where Senator Bob Peterson became the new Chairman of the senate committee that generally is assigned bills that concern matters of taxation policy.
The first official action occurred Thursday under Chairman Peterson's leadership with sponsor and proponent hearings on the municipal tax reform bill. The testimony committee members were provided was delivered by Reps. Cheryl Grossman and Mike Henne, who again explained how they perceive the goals of their legislation to bring business filers greater simplicity and ease of compliance when complying with municipal tax obligations. The sponsors "tag teamed" their testimony presentation, sharing with committee members how they anticipate some revenue loss by municipalities when conforming to the new state imposed treatments but the expected increase in economic development municipalities will experience by their reforms will offset the negative effects.
Much like the testimony members of the Senate Finance committee where presented with, proponents who provided testimony were led by past state of Ohio Tax Commissioner and leader of the Municipal Tax Reform Coalition Tom Zaino with other coalition representatives Chris Ferruso of the NFIB, Dan Navin with the Ohio Chamber of Commerce and Andrea Ashley with the General and Ohio Contractors Association. Again like the sponsors, the proponents presented identical testimony to what was presented to the finance committee members where advocates explained the complications with the current municipal tax that frustrates their members and expanded on the virtues of the reform treatments that they advocate will fix what ails Ohio's economic woes. Also providing testimony was Lisa Crosley, president of EnvironControl Systems and Albert Macre, a CPA with Macre & Co. Copies of the testimony provided can be accessed through the Senate committee website at http://www.ohiosenate.gov/committee/ways-and-means .
As you will notice throughout the testimony provided, sponsors and proponents continued their assault on the ability of municipalities to accurately apply revenue impact figures to areas in the reform bill and reiterated that because the proponents do not have full access to municipal taxpayer data, that municipal analysis of potential financial consequences of changes in current treatment cannot be verified and thus is merely speculation and should be discounted.
Committee members had numerous questions for the sponsors and proponents, asking primarily about the revenue impacts to municipalities and how already struggling communities will be able to weather the cuts, there was a particular emphasis placed upon the section of the legislation that deals with NOLs and the NOL Impact Review Study Committee. While proponents of the bill insisted the review committee should study the financial impacts to municipal budgets after the damage has been done and the treatments are enacted into Ohio law, many committee members questioned the logic of not providing time for greater study to a treatment or treatments that is understood will have significant consequences to municipal budgets before putting it into law.
Chairman Peterson has announced the committee will hold a opponent hearing next Tuesday, November 18th, 3:30 p.m. in the south senate hearing room, All Parties testimony the following day, Wednesday the 19th at 3:30 p.m. in the south hearing room with a vote by the committee and then to the full Senate the first week of December. If those that would like to provide opponent testimony but cannot attend the Tuesday hearing, committee members will receive opponent testimony as part of the All Parties testimony hearing Wednesday at 3:30 p.m.
This literally is it, the last chance for municipal officials to help educate policy makers on what the changes they are considering will mean to municipalities, Ohio residents and businesses across the state.