Governor Kasich Signs State Budget Bill - CAT Exemption for Grain Handlers Becomes Law

State Senate Introduces Nutrient Management Bill; Grain Indemnity Fund Law Changes Waiting for Governor’s Signature

The Ohio AgriBusiness Association initiated provision to exclude all licensed agricultural commodity (grain) handlers from paying the state’s Commercial Activity Tax was signed into law on Sunday evening June 30 by Governor John Kasich as part of the final state budget bill, HB 59 (R - Amstutz) that passed both legislative chambers on Thursday, June 27.

This has been an issue for some time for our membership and will provide not only a level playing field for all Ohio grain handlers, but will also benefit the state's overall economy. The law goes into effect immediately and will provide tax relief this harvest season. 

The new state budget holds a number of other policy changes as well. A few of the more notable items in the $62 billion, two-year state budget include:

• An income tax rate cut of 8.5 percent this year, and up to 10 percent by 2015.
• An increase in the state sales tax from 5.5 percent to 5.75 percent, but no major expansion as originally proposed by the governor.
• A small business tax cut for “pass-through-entities” of up to 50 percent on $250,000 of net income.

Both Medicaid expansion and a severance tax on oil/gas drilling, as originally proposed by the governor, are out of the bill.

We are also pleased to share that sufficient funding has been restored for The Ohio State University's Agricultural Technical Institute. Additionally, funding has increased for Ohio's Agricultural Research and Development Center and OSU Extension.

State Senate Introduces Nutrient Management Bill

Senators Cliff Hite (R – Findlay) and Bob Peterson (R – Sabina) are cosponsoring SB 150 – which was introduced Tuesday, June 25 – and was referred to the Senate Agriculture Committee. The bill – titled Agricultural Additives, Lime and Fertilizer Law – will revise the law governing the abatement of agricultural pollution, to require a person that applies fertilizer for the purposes of agricultural production to be certified to do so by the Director of Agriculture, to provide for an agricultural pesticide-use category on commercial and private pesticide applicator licenses, and to make other changes to the Agricultural Additives, Lime and Fertilizer Law.

We have been engaged on this bill for some time. As you may recall, OABA weighed in on a draft version of this bill in March (click here for more details). OABA, working with agricultural organization partners, was able to get substantial changes made before the bill was introduced. There is still much work to do, but with the legislature on a summer break, committee hearings won’t start until mid-September at the earliest.

Grain Indemnity Fund Law Changes Waiting for Governor’s Signature

SB 66 (R – Hite) updates and increases the state’s Grain Indemnity Fund. Amongst other things, the bill would increase the fund to $15 million. Both the Ohio House and Senate have approved the bill and it is awaiting Governor John Kasich’s signature. It is not clear at this time when collection will go into effect, but it will likely be in time for at least a portion of this fall’s harvest.