House To Approve Budget Proposal – Senate Hearings Already Underway

Lawmakers in the Ohio House of Representatives are set to give final approval to a state budget proposal to fund government operations and other projects for the next two years. The House Finance Committee reported the spending plan on April 25 and the full House of Representatives will consider the proposal on the afternoon of April 26.

In total, the budget appropriates $192 billion in state and federal funds over the next two years for a wide variety of programs, including K-12 education, Medicaid, and numerous economic development programs.

GOPC has spent the past three months working with lawmakers on a number of issues in the budget, with some successes achieved in the House, with more work to be done in the Ohio Senate. Below is a summary of issues GOPC has been working on.

Brownfield Remediation Fund and the Commercial/Residential Demolition Programs

Two years ago, GOPC was the leading advocate for new funding to support brownfield remediation efforts across the state of Ohio. That advocacy led to the creation of the new Brownfield Remediation Fund, with $350 million in one-time money appropriated to support brownfield identification and clean up efforts throughout Ohio. All of that money has been successfully awarded to more than 200 projects around the state, with many more in the pipeline waiting for the opportunity to receive funds. The program has been incredibly popular in has seen awards made in 83 of Ohio’s 88 counties.

At the same time, lawmakers also created the Commercial and Residential Building Demolition Program, which provided Ohio’s land banks with $150 million in one-time funds to assist in the demolition of blighted commercial and residential buildings throughout the state. Like the brownfield program, all $150 million of that funding has been spoken for, with grants issued in 87 of 88 counties.

Advocates were surprised when no new funding was proposed by the administration for both of these programs despite overwhelming demand for additional funds. GOPC has led the way once again, testifying three times before the Finance Committee and Agriculture Subcommittees to discuss the need for funds, as well as meeting with 22 members of the House of Representatives, urging them to again support funding for these critical programs that are revitalizing thousands of blighted properties around Ohio, creating new opportunities for economic and residential development.

The House Finance Committee agreed with our position and has provided an additional $500 million to the two programs over the next two years.

Safe Routes to Schools Active Transportation Funding

GOPC has been a strong proponent of supporting the Safe Routes to Schools Program, an ODOT program supported with federal funds to create safe active transportation options for children to walk to bike to school. GOPC has been encouraging lawmakers to help grow and expand the program by matching state dollars with federal dollars to grow the program to $10 million annually. While many lawmakers expressed interest in this proposal, it was not added by the House of Representatives to the budget.

Housing Programs

A number of proposals were included in the as-introduced budget around housing development, including the creation of a state low-income housing tax credit and a single-family housing tax credit, homebuyers savings accounts, and funding to assist local governments expedite the zoning and housing development approval process. The House of Representatives made changes to these proposals, and included a few new changes in the final approved version as well.

The state low-income housing tax credit has been maintained in the House-version of the budget, expanding significantly from the as-introduced proposal. The House budget permits up-to $500 million in state credits per year, and allows credits to be issued retroactively to the beginning of 2023, and expands their use to the end of 2028.

The House removed the proposal to create a single-family housing development tax credit, which would have permitted up-to $50 million in credits per year for the development of affordable single-family housing.

The homebuyer savings account provisions have been maintained in the budget.

The proposed Housing Technical Assistance program, which would provide $1.5 million per year to be used to aid local governments seeking to modernize regulations and processes tied to local housing efforts, including updating housing-related zoning regulations, has been preserved in the House-version of the budget, however no funding appropriations have been made in the budget. GOPC was an early proponent of this proposal, first outlined in our policy agenda issued last summer.

We will continue to advocate for this funding program, in hopes of increasing the appropriation to as much as $5 million per year.

Other changes made related to housing include an aborted effort to require the Ohio Housing Finance Agency (OHFA) to receive approval from a board of county commissioners for any project that would include federal low-income housing tax credits and any other financial assistance from OHFA before a project could begin. This proposal would have seriously hampered efforts to build quality, affordable workforce housing across Ohio and was thankfully removed before final approval by the Finance Committee. GOPC appreciates the support of our partner communities of practice, including the CDFI Network and Affordable Housing Learning Exchange, who mobilized in opposing the proposal.

Finally, house lawmakers added a provision GOPC and others have opposed for at least the past three Ohio General Assemblies that would exempts from property tax the value of unimproved land subdivided for residential development in excess of the fair market value of the property from which that land was subdivided. This proposal would allow developers to make substantial improvements to a property, including the construction of roads, sewers, sidewalks and lighting, without breaking ground on the development of Housing and not pay a higher property tax rate, with the property still being valued as if it was agricultural-used property. The exemption would last for as long as 8 years, or until construction begins or the land is sold.

GOPC has long opposed any legislation that encourages and supports sprawl-development and will strongly encourage members of the Ohio Senate to remove this latest effort to encourage sprawl development in Ohio.

Once the House gives final approval to the budget, the Ohio Senate will begin the process of revising the proposal. Senators have already started preliminary hearings on the state budget, with a number of committees hearing testimony this week from state agencies speaking to their budget requests.

Final Senate work on the budget is expected by mid-June, with final passage expected by June 30. The new state budget must be in place by the state of the next state fiscal year which begins July 1, 2023.