Small Business Legislation in Ohio’s Lame Duck Session

Now that the nail-biting mid-term elections are over, the legislature can get back to business.  But what does getting back to business look like given the election results?  The agenda for the end of the year promises to be less exciting than it could have been if democrats were to be taking over the governor’s office next year.  An entirely republican slate of statewide offices means that the legislature can be much less aggressive.  In fact, we are hearing that the Senate may only use three session days through the end of the year.

Along with less activity, you can expect a lame-duck with very little attention given to any last minute policy demands of Gov. Kasich.  This legislature has continued to grow further apart from the governor’s demands and policy initiatives.  And at this point it is not the legislature’s responsibly to hard coat Gov. Kasich’s legacies.  Additionally, we are expecting JCARR to reject Gov. Kasich’s water quality rules and move to invalidate the rule package.  Rule validation is a rarity under any legislature or administration so this would be direct a slap in the governor’s face. 

Aside from rule-making, there are a handful of overarching legislative priorities in which the legislature will attempt to accomplish.  However, we are primarily concerned with those that aim to impact small businesses.  Below are the bills that (if enacted) would have a direct positive impact on small businesses.  SBCO has already worked on and advocated for these pieces of legislation but plans to do whatever possible to ensure passage.

SB 221

Senate Bill 221 is a rule-making and regulatory reform bill that provides businesses with more opportunities in which to express their concerns or their expected or realized adverse impacts of agency rules.  This bill passed both the House and Senate but was vetoed by the governor soon thereafter.  Leaders of both the House and Senate, including President Obhof, have indicated that they will likely attempt an override of the bill and believe they have the bi-partisan votes necessary.  In large part, SB 221 was written by small business owners that indicated they needed more protection from unelected bureaucrats.  However, Gov. Kasich and his administration appear to have taken offense to the legislature passing legislation that modifies the way in which executive agencies write rules.  SBCO will continue to do everything possible to ensure that a veto override attempt is made.

HB 492

This legislation creates a Women-Owned Business Enterprise Program in the state of Ohio.  The state does not currently have a procurement program which puts Ohio owned women-businesses at a disadvantage when bidding on projects outside of the state.  For instance, if Indiana has certain contracts that are set aside for certified women-owned businesses, women-owned businesses in Ohio cannot bid on them.  HB 492 levels the playing field and allows women-owned businesses to compete across state lines.

HB 10

House Bill 10 passed both the House and the Senate but faces challenges gaining a concurrence vote in the House.  The legislation was originally designed to merely allow small businesses and start-ups to legally obtain equity crowdfunding financing from Ohio residents.  Currently, crowdfunding in Ohio is limited to debt capital or mere “donations” or “contributions” from individuals.  Unfortunately, after unanimously passing the Senate, the Senate Rules and Reference Committee added an amendment that allows the Auditor of State to conduct audits of the economic development entity, JobsOhio.  The amendment has nothing to do with the original subject of the bill and SBCO has subsequently expressed our frustration with the amendment.  We will continue to advocate for the concurrence of HB 10, especially if it means the removal of the Senate amendment.  SBCO is not suggesting that an audit of JobsOhio is unnecessary, we merely believe that the amendment be place in another piece of legislation or a stand-alone bill.

SB 293

In the same vein as SB 221, this legislation reforms the rule-making authority of state agencies.  The bill is well intentioned, as it aims to reduce the amount of regulatory restrictions put on businesses.  However, the primary question or concern that we have is that the bill places arbitrary thresholds on the reductions.  It may be unfeasible for certain agencies to reduce regulations by the prescribed percentage and year required.  SBCO maintains that the best approach to regulatory and rule reform is to target those that are actually adversely impacting businesses and not paint all rules and regulations as impedance on business.  As it relates to this bill, we take the position of an interested party.

SB 205

Senate Bill 205 is a piece of legislation that allows corporations to be designated as “Benefit Corporations”.  The growth and popularity of social enterprises and companies that wish to have a philanthropic interest is not going to slow anytime soon, and this bill is a reaction to that.  The Benefit Corporation designation does not change the tax status of the business, but protects the corporation and its directors from damages for failures to achieve their mission.