Daily Court Reporter - News State Republicans offer new plan to lure more 'megaprojects' to Ohio
State Republicans offer new plan to lure more 'megaprojects' to Ohio
KEITH ARNOLD, Daily Reporter Staff Writer
A Republican plan to make the state even more competitive for businesses looking to site the next large-scale development within the state proposes doubling the term of tax breaks, while at the same time, giving the state an exit clause.
The beauty of this proposal, said Hilliard Sen. Stephanie Kunze, a joint sponsor of the bill, is the narrow tailoring that makes its provisions apply only to the largest of companies.
The largest companies planning the biggest projects, rather.
Senate Bill 95 applies to the "megaproject" - a project that requires unique sites, extremely robust utility service and a technically skilled workforce, while compensating employees at an average hourly wage of at least 300 percent of the federal minimum wage, excluding benefits.
Additionally, these megaprojects must satisfy a requirement for fixed-asset investments to equal at least $1 billion or for payroll of Ohio employees reaches the $75 million mark.
"One of the greatest responsibilities we have in the Ohio General Assembly is to make Ohio competitive and more attractive than other states, to encourage businesses to locate and grow in Ohio and to employ our citizens," Kunze told fellow senators seated on the Ways and Means Committee. "When Ohio misses out on opportunities to create jobs, not only do our local governments miss out on new tax revenue, more importantly, Ohioans are not afforded the opportunity to be gainfully employed and provide for their families with well-paying jobs.
SB 95 would authorize lengthening the maximum term of the refundable Job Creation Tax Credit, or JCTC, from the current 15 years to 30 years and the local community reinvestment area or enterprise zone property tax exemptions to 30 years.
Additionally the measure would authorize assignment of all or a portion of a megaproject supplier's JCTC to the megaproject's operator and a commercial activity tax exclusion for gross receipts of a megaproject supplier from sales to a megaproject operator.
The executive director of Pickaway County's economic development organization, P3, supported Kunze's assertion of what such investment can mean for the region.
"Pickaway County is in the midst of an historic period of growth and recovery," Ryan Scribner said. "Our community has been the recipient of $1.7 billion of private capital investment, resulting in 3,500 new manufacturing and logistics jobs in the last eight years.
"The impact of this growth is having a profound impact on our small county of just 56,000 residents."
Scribner based the county's success on taking advantage of strategic intergovernmental partnerships with the county and Columbus in the northern reaches of the county.
And, yet, with this amount of success, there were megaprojects that have passed on the county, he said.
"We know from benchmarking with other states that similar measures have been taken to ultimately win these transformative development projects," he said. "My hope is that through the passage of SB 95, Ohio will equip itself with the tools needed to win the types of projects that will no only sustain economic recovery, but propel us into a whole new level of prosperity."
SB 95 ensures checks and balances by way of an annual review to ensure that the requirements are still being met in the signed agreement between the state and the megaproject.
"If it is discovered that the agreement has not been met, the tax authority can cancel the terms of the agreement," Kunze said.
The measure is necessary to make Ohio more attractive for large companies to invest and build their companies here, she concluded.
Sen. Bob Peterson, R-Sabina, is joint sponsor of the bill.
A third hearing of SB 95, which has cosponsor support of four fellow senators, had not been scheduled at time of publication.
Date Published: June 3, 2019