LEGISLATIVE UPDATE. 131 st OHIO GENERAL ASSEMBLY

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LEGISLATIVE UPDATE

131

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_{OHIO GENERAL ASSEMBLY}

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Budget and Taxes

Workforce Grant Program ……… 3

Business Filing Fees ……… 3

Income Tax Reductions ……… 4

State Operating Budget ……… 4

Tax Expenditure Review ……… 5

Municipal Tax Lawsuit ……… 5

State Government

Public Assistance Review ……… 6

Government Expenditure Database ……… 6

Ban the Box – Gov’t. Employee ……… 6

Adult Changing Table Mandate ……… 7

Healthcare

Telemedicine Mandate ……… 8

Contraceptive Mandate ……… 8

Hearing Aid Mandate ……… 9

Prior Authorization ……… 9

Health Insurance Exchange ……… 9

Out of Pocket Limit Rare Disease Drugs ……… 10

Universal Healthcare ……… 10

Labor

Minimum Wage Increase ……… 11

Employee Credit History ……… 11

Employee Social Media Protection ……… 12

Ban The Box ……… 12

Workers’ Comp/Unemployment Comp

Industrial Commission Budget ……… 13

BWC Budget ……… 13

Military Spouse Unemployment Comp ……… 13

PTSD/Workers’ Comp First Responders ……… 14

Firefighter Presumptive Cancer BWC ……… 14

Tort Reform/Civil Justice

TiPAC ……… 15

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BUDGET AND TAXES

WORKFORCE GRANT PROGRAM - House Bill 1 – Sponsored by Representatives

Kirk Schuring (R – Canton) and Nathan Manning (R-N. Ridgeville)

To establish the Workforce Grant Program, to authorize an income tax credit equal to 25% of the student loan payments a grant recipient makes per year, and to make an appropriation.

NFIB/Ohio Position: Interested Party

Analysis: The bill awards grants, up to $5,000 annually, to students who are

attending a public university, or community college and are pursuing a degree or certificate in an in-demand field. The bill also stipulates that the student must work/intern at a business in their field of study for 30 to 90 days. The total appropriation is $100,000,000 to be distributed by the Board of Regents. The bill could be expanded to include all schools including private to encourage Ohioans to stay in Ohio after completion of coursework.

Status: Introduced January 28, 2015. Pending before the Ohio House Economic

and Workforce Development Committee.

BUSINESS FILING FEES – House Bill 3 and Senate Bill 26 – Sponsored by

Representatives Tim Derickson (R – Oxford) and Mark Romanchuk (R – Mansfield) and Senator Larry Obhof (R – Medina)

To reduce certain business filing fees charged and collected by the Secretary of State and to specify that Ohio-based companies are to have access to appropriate features of the OhioMeansJobs web site.

NFIB/Ohio Position: Support

Analysis: The bill reduces certain filing fees for business start-ups in Ohio making them the lowest of neighboring states. The bill also gives all Ohio businesses in good standing access to all the features of the OhioMeansJobs website. The bill conceptually is attempting to ease the burden of starting a business. The fee reduction does not impact existing businesses.

Status: Introduced January 28, 2015 and February 2, 2015. Pending before the

Ohio House Economic and Workforce Development and Ohio Senate Agriculture Committees.

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INCOME TAX REDUCTIONS – House Bill 23 – Sponsored by Representative Ron Amstutz (R – Wooster)

To use one-half of any income from oil and gas leases on state land to fund temporary income tax reductions, to modify the law governing the use of new Ohio use tax collections from remote sellers for income tax reductions, and to require the Director of Budget and Management to recommend whether or not income tax rates should be permanently reduced after the Director certifies a temporary rate reduction resulting from the accrual of money in the Income Tax Reduction Fund.

Analysis: The bill requires half of any income tax from oil and gas leases to be

put into the temporary income tax reduction fund. The bill requires OBM director to evaluate the amount in the fund to determine if sufficient funds are accrued to warrant a permanent income tax cut. The bill further requires, if/when federal legislation is enacted regarding remote sellers, the money collected in sales and use tax to be put toward income tax reductions.

Status: Introduced January 28, 2015. Pending before the Ohio House Ways &

Means Committee.

STATE OPERATING BUDGET – House Bill 64 – Sponsored by Representative Ryan

Smith (R – Galipolis)

Makes appropriations for the operations of the state.

Analysis: NFIB/Ohio will be primarily focused on the tax reform components of

the operating budget. The overall package results in a net tax reduction of $500 million. There is a 23% across the board income tax reduction, increase in personal exemption for those under $40k and up to $80k, zero income tax on business income for pass-through entities with $2 million or less in gross receipts and flat $150 charge on CAT for those same entities with less than $2 million in gross receipts. Tax increases included CAT increase from .26 to .32 (or 23%), severance tax on horizontal natural gas and oil wells of 6.5% at wellhead and 4.5% downstream, increase in tobacco tax from $1.25 to $2.25, increase in sales tax from 5.75% to 6.25% and a broadening of the base to include additional services like “management consulting,” reduction to 50% for used motor vehicle or watercraft trade in on sales tax, elimination of retirement tax credit and other means testing. NFIB/Ohio will continue to monitor the changes made to the budget as it works through the process.

Status: Introduced February 11, 2015. Pending before the Ohio House Finance

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TAX EXPENDITURE REVIEW – House Bill 65 – Sponsored by Representative Denise Driehaus (D – Cincinnati)

To provide for the periodic appraisal of the effectiveness of tax expenditures.

Analysis: The bill requires tax expenditures, of which nearly 140 exist, to be

reviewed on a biannual basis to determine public policy purpose and effectiveness. The bill also creates a review committee to study all tax expenditures and make a recommendation to the General Assembly.

Status: Introduced February 12, 2015. Pending before the Ohio House Ways &

Means Committee.

MUNICIPAL TAX LAWSUIT – House Bill 84 – Sponsored by Representatives Robert

Sprague (R – Findlay) and Martin Sweeney (D – Cleveland)

To require civil actions by taxpayers related to municipal income taxes be brought against the municipal corporation imposing the tax rather than the municipal corporation's tax administrator.

Analysis: The bill adjusts language in House Bill 5 from the 130th GA

(municipal tax reform) to clarify that civil actions are brought against the

municipality not the tax administrator. NFIB/Ohio will be closely monitoring this legislation to ensure nothing positive in HB 5 is undone.

Status: Introduced February 25, 2015. Pending referral to committee in the Ohio

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STATE GOVERNMENT

PUBLIC ASSISTANCE REVIEW – Senate Bill 8 – Sponsored by Senator Dave Burke

(R – Marysville)

It is the intent of the General Assembly to review the utilization and delivery of existing public assistance programs to maximize the opportunity of benefit recipients to lead full and successful lives.

Analysis: The bill simply states the goal of reviewing public assistance programs

in hopes of reducing the rolls and transitioning folks off of the these programs. There are no committees, goals, etc. yet detailed.

Status: Introduced February 2, 2015. Pending before the Ohio Senate

Agriculture Committee.

GOVERNMENT EXPENDITURE DATABASE – House Bill 46 – Sponsored by

Representatives Mike Dovilla (R – Berea) and Jonathan Dever (R – Cincinnati)

To require the Treasurer of State to establish the Ohio State Government Expenditure Database.

Analysis: The bill requires political subdivisions, school districts, state entities and vendors to report monthly to the Treasurer of State on the amount, date, requester and recipient of expenditure. The data will be searchable,

downloadable, etc. A good government transparency bill. The impact of compliance by impacted entities is still being evaluated.

Status: Introduced February 10, 2015. Pending before the Ohio House State

Government Committee.

BAN THE BOX GOV’T. EMPLOYEE – House Bill 56 – Sponsored by

Representatives Kirk Schuring (R – Canton) and Stephen Slesnick (D – Canton)

To limit the use of criminal records in the hiring and employment practices of public employers.

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Analysis: The bill prohibits public employers from inquiring about an applicant’s criminal background until the public employer is prepared to make an offer of employment. The bill does allow a public employer to notify applicants of preclusion from employment for certain offenses related to the job. Although the bill limits to public employers, ban the box can lead to a lengthy interview

process where an applicant will be ultimately be precluded from employment but this is not known until long into the process. NFIB/Ohio will monitor to ensure this bill applies only to public employers.

Status: Introduced February 10, 2015. Pending before the Ohio House

Commerce & Labor Committee.

ADULT CHANGING TABLE MANDATE – Senate Bill 112 – Sponsored by Senator

Peggy Lehner (R – Kettering)

To require public buildings to have at least one rest room facility with an adult changing station.

NFIB/Ohio Position: Opposed

Analysis: The bill requires that every building constructed after January 1, 2017,

to have at least one rest room with an adult changing station. The bill requires various specifications on size, weight loads, etc. of the table. This mandate just subjects builders and owners to new fronts on which to be sued should one such specification not meet the specifics of the law.

Status: Introduced March 4, 2015. Pending referral to committee in the Ohio

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HEALTHCARE

TELEMEDICINE MANDATE – Senate Bill 32 – Sponsored by Senator Charletta

Tavares (D – Columbus)

Regarding insurance and Medicaid coverage of telemedicine services.

Analysis: The bill requires that any fully-insured plan allow telemedicine

services and not subject to any great deductible or co-pay greater than a face-to-face consultation. The bill further stipulates that the Medicaid program can’t force telemedicine in lieu of face-to-face. Notably absent are public plans. NFIB/Ohio is working to understand any negative repercussions of this mandate versus cost savings that may be recognized.

Status: Introduced February 9, 2015. Pending before the Ohio Senate Medicaid

Committee.

CONTRACEPTIVE MANDATE – Senate Bill 68 – Sponsored by Senator Charletta

To require health insurers to provide coverage for contraceptive drugs and devices approved by the United States Food and Drug Administration and to prohibit employment discrimination under the Ohio Civil Rights Law on the basis of reproductive health decisions made by a person or a person's dependent or on the basis of the employer's personal beliefs about drugs, devices, and services related to reproductive health.

Analysis: NFIB has staunchly opposed any expansion of state-imposed health

insurance mandates. They only include approximately 25% of the insured market leaving significant gaps in coverage. Further, these costs are exclusively born on the backs of small-group and individual policy holders who are not exempt like their larger brethren due to federal ERISA law. The bill also adds a

discrimination provision possibly opening employers up to new avenues for litigation.

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HEARING AID MANDATE – Senate Bill 98 – Sponsored by Senator Edna Brown (D – Toledo)

To require health insurers to offer coverage for hearing aids.

Analysis: The bill requires that all health insurance policies that provide basic coverage be required to include a benefit of no less than $1,500 per year over three years. The bill also prohibits any deductible or co-pay charges. Like all mandates they are only applicable to the fully-insured market, arguably the most volatile, leaving significant coverage gaps.

Status: Introduced March 3, 2015. Pending before the Ohio Senate Insurance

Committee.

PRIOR AUTHORIZATION REQUIREMENTS – Senate Bill 129 – Sponsored by

Senators Randy Gardner (R – Bowling Green) and Capri Cafaro (D – Youngstown)

To amend the law related to the prior authorization requirements of insurers.

Analysis: Requires insurers to respond to requests for prior authorizations within

a specified timeframe or the authorization is granted. Requires a standard form to be created by Dept. of Insurance for prior authorization requests. Requires

denials to be made by a medical professional. The bill aims to provide more certainty for both patient and provider with respect to requests for prior authorization and to expedite the approval/denial process when medically necessary procedures must be done quickly.

Committee.

HEALTH INSURANCE EXCHANGE – Senate Bill 132 – Sponsored by Senators

Michael Skindell (D – Lakewood) and Charleta Tavares (D – Columbus)

To establish the Ohio Health Benefit Exchange Program consisting of an

exchange for individual coverage and a Small Business Health Options Program.

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board and mission for both individuals and small business health insurance purchasers.

Committee.

OUT OF POCKET LIMIT RARE DISEASE DRUGS – Sponsored by Senators Capri

Cafaro (D – Youngstown) and Shannon Jones (R – Springboro)

To limit the out-of-pocket cost to an individual covered by a health plan for drugs used to treat rare diseases.

Analysis: The bill limits the costs to an individual who has prescription health coverage for drugs used to treat rare diseases. It caps expenses at $150 for a one month supply, allows individuals to request addition of drugs to this category and prohibits an insurer from putting all drugs in a given class into a specialty tier. The bill reads like a health insurance mandate in that it has the notwithstanding language. Analysis ongoing to understand what premium impact this may have on all policies given the limit on charges and the potential for mutualizing the costs across all policy holders to recoup costs.

Committee.

UNIVERSAL HEALTHCARE – Senate Bill 137 – Sponsored by Senators Michael

Skindell (D – Lakewood) and Charleta Tavares (D – Columbus)

To establish and operate the Ohio Health Care Plan to provide universal health care coverage to all Ohio residents.

Analysis: The bill eliminates the competitive market for health insurance in favor

of a universal, government run program. The bill is funded through employer payroll assessments of no more than 3.85% in first year, assessments on gross receipts of employers not to exceed 3% in the first year, assessments on income tax of 6.2% and for those earning over $200,000 an additional 5%.

Status: Introduced April 6, 2015. Pending before the Ohio Senate Insurance

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LABOR

MINIMUM WAGE INCREASE – Senate Bill 25 – Sponsored by Senator Kenny Yuko

(D – Richmond Heights)

To raise the minimum wage; to raise the salary threshold above which certain employees are exempt from the overtime law; and to create a uniform standard to determine whether an individual performing services for an employer is an employee of that employer.

Analysis: The bill would increase the minimum wage to $10.10 per hour, raise

the salary threshold for exemption from the overtime law to $69,000 annually in 2017, and create a new test for employees. The bill creates a new set of factors for determining whether an individual is an employee. The bill allows any aggrieved party to bring suit and puts the burden on the person asserting an individual is not an employee. Further the bill allows an aggrieved party to recover 10% of any judgment against an employer for misclassification. The bill creates a system whereby employers could be subjected to having to prove employee status on a frequent basis by competitors or others.

Transportation, Commerce & Labor Committee.

EMPLOYEE CREDIT HISTORY – Senate Bill 65 – Sponsored by Senator Charletta

To specify that discrimination by an employer against any person because of the person's credit history is an unlawful discriminatory practice under the Ohio Civil Rights Law.

Analysis: The bill prohibits an employer from using a person’s credit history as a

means to not hire that individual or impact their ongoing employment or

opportunities. NFIB/Ohio does not condone discrimination. However, this bill does create a new protected class potentially subjecting employers to new fronts on which to be sued. Short of including employer protections as part of a more comprehensive employment law revision, this bill is a non-starter.

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EMPLOYEE SOCIAL MEDIA PROTECTION – Senate Bill 70 – Sponsored by Senators Charletta Tavares (D – Columbus) and Cecil Thomas (D – Cincinnati)

To prohibit employers, employment agencies, personnel placement services, and labor organizations from requiring an applicant or employee to provide access to private electronic accounts of the applicant or employee.

Analysis: The bill creates a protected class for electronic accounts, including social media. NFIB/Ohio completely appreciates the need for privacy however elevating to a protected class creates new fronts on which employers may be sued. Short of including employer protections as part of a more comprehensive

employment law revision, this bill is a non-starter.

Senate.

BAN THE BOX – Senate Bill 79 – Sponsored by Senator Sandra Williams (D –

Cleveland)

To prohibit employers from including on an employment application any question concerning whether an applicant has been convicted of or pleaded guilty to a felony.

Analysis: The bill prohibits an employer from asking about an applicant’s

pleading guilty to or being convicted of a felony on a job application. The bill does not preclude an employer from doing a background check. The bill appears to include no penalties for non-compliance. NFIB/Ohio members believe they should have the right to ask the question upfront and make their own decision about how to handle any previous felonies.

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WORKERS’ COMP & UNEMPLOYMENT COMP

INDUSTRIAL COMMISSION BUDGET – House Bill 51 – Sponsored by

Representative Bob Hackett (R- London)

Makes appropriations for the Industrial Commission for fiscal years 2016-2017.

Analysis: This is simply an appropriations bill. There is currently no policy changes included. NFIB/Ohio will continue to monitor for any policy additions. The bill appropriates $102.4 million over the biennium.

Status: Introduced February 10, 2015. Pending before the Ohio House Insurance

Committee.

WORKERS’ COMP BUDGET – House Bill 52 – Sponsored by Representative Bob

Hackett (R – London)

To make changes to the Workers' Compensation Law, to make appropriations for the Bureau of Workers' Compensation for the biennium beginning July 1, 2015, and ending June 30, 2017, and to provide authorization and conditions for the operation of the Bureau's programs.

Analysis: The bill is not heavy on policy. Although one positive is the elimination of the DWARF assessment built into employer premiums to raise benefits for long-standing claims that have not kept pace with inflation. The $552.4 million budget is a 4% decrease from the previous biennium. Analysis is ongoing.

Status: Introduced February 10, 2015. Pending before the Ohio House Insurance

Committee.

MILITARY SPOUSE UNEMPLOYMENT COMP – House Bill 105 – Sponsored by

Representatives Herschel Craig (D – Columbus) and Rick Perales (R – Dayton)

To permit persons who quit work to accompany the person's spouse on a military transfer to be eligible for unemployment compensation benefits.

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$500+ tax increase on employers. Short of repaying the loan to the federal government to eliminate this tax increase NFIB/Ohio must oppose this proposal.

Status: Introduced March 5, 2015. Pending referral to committee in the Ohio

House.

PTSD/WORKERS’ COMP FIRST RESPONDERS – Senate Bill 5 – Sponsored by

Senator Tom Patton (R – Strongsville) and Edna Brown (D – Toledo)

To make peace officers, firefighters, and emergency medical workers diagnosed with post-traumatic stress disorder arising from employment without an

accompanying physical injury eligible for compensation and benefits under Ohio's Workers' Compensation Law.

Analysis: The bill would allow first responders to be eligible for workers’ compensation benefits without an accompanying physical injury. The workers’ compensation system is premised on the notion that there must be a physical injury to an injured worker for consideration of a mental allowance. Although this bill is limited to first responders who are public workers, the precedent is troubling. Should it be opened to the private sector, via statute or court ruling, it would likely cost employers billions of dollars.

Transportation, Commerce & Labor Committee.

FIREFIGHTER PRESUMPTIVE CANCER BWC – Senate Bill 27 – Sponsored by

Senator Tom Patton (R – Strongsville)

To provide that a firefighter who is disabled as a result of specified types of cancer is presumed for purposes of the laws governing workers' compensation and the Ohio Police and Fire Pension Fund to have incurred the cancer while

performing official duties as a firefighter.

Analysis: The bill creates a presumptive assumption that any firefighter that is diagnosed with a certain list of cancers provided for in the bill, acquired such cancer as a result of their job duties for purposes of workers’ compensation. Although this bill is limited to only firefighters, NFIB/Ohio will continue to monitor this bill for any suggested expansion to the private sector.

Status: Introduced February 9, 2015. Pending before the Ohio Senate Insurance

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TORT REFORM/CIVIL JUSTICE

TiPAC – House Bill 10 and Senate Bill 38 – Sponsored by Representative Jim Butler (R

– Oakwood) and Senator Bill Seitz (R – Cincinnati)

To provide transparency in contracts between the state of Ohio and private attorneys.

NFIB/Ohio Position: Support – NFIB/Ohio Key Vote

Analysis: Transparency in Private Attorney Contracts (TiPAC). The bill is

drafted based upon a model bill that requires the Attorney General to do

competitive bids for contracts with private attorneys and disclose those contracts in an annual report.

Status: Introduced January 28, 2015 and February 9, 2015. Pending before the

Ohio House Government Oversight and Accountability Committee and the Ohio Senate Government Oversight and Reform Committee.

LEGISLATIVE UPDATE. 131 st OHIO GENERAL ASSEMBLY