House of Representatives and Senate Finance Committee pass Tax Cuts and Jobs Act

The House of Representatives passed H.R. 1, the Tax Cuts and Jobs Act, on November 16, 2017, by a vote of 227 to 205. The House bill continues to contain the repeal of private activity bonds and advance refundings. The Senate Finance Committee passed its version of tax reform hours later, 14-12. The Senate bill is silent on private activity bonds but contains the advance refunding repeal. The full Senate is expected to consider its version after Thanksgiving. Read more >>

Federal Updates, Legal Developments

Senate releases its version of the Tax Cuts and Jobs Act

On November 9, the Senate Finance Committee released the "Chairman's Mark," which is a summary of what the Senate's version of the Tax Cuts and Jobs Act is expected to contain. Unlike the House's version of tax reform, the tax exemption for private activity bonds is not repealed. However, the repeal of authorization for advance refunding has been included in the Senate version. Especially with the appearance of the prohibition for advance refundings in both the House and Senates tax bills, modification of financing techniques that provide significant flexibility to governmental issuers and 501(c)(3) entities and help them take advantage of falling interest rates is likely on the horizon. Read more >>

Federal Updates, Legal Developments

H.R. 1 proposes significant limits on municipal bonds

On November 2, 2017, the U.S. House of Representatives Ways & Means Committee released its first draft of H.R. 1, known as the Tax Cuts and Job Act (the bill). If enacted in its current form, the bill would prohibit the use of a number of funding techniques that use tax exempt bonds. Specifically, the bill would no longer permit private activity bonds to be issued as tax exempt, would forbid the use of tax exempt advance refunding bonds, would eliminate tax credit bonds and would terminate tax exempt bonds for professional sports stadiums. Read more >>

Federal Updates, Legal Developments

Reversing stricter wind turbine setback rules could gain Ohio $2 billion

A recent American Wind Energy Association (AWEA) study shows that Ohio could gain billions in investments and thousands of jobs if wind turbine setbacks were reduced, Gongwer Ohio reports. Renewable energy advocates are urging the Senate “to reduce the wind turbine setback through the budget process,” according to the article. AWEA’s study “projected Ohio could gain $2 billion in capital investments, 13,000 jobs and more than $660 million in tax payments to local governments and schools” if setback requirements were reduced. Local government and economic development groups say 2014 legislation that increased wind turbine setback requirements from 550 feet to 1,125 feet “effectively killed new wind farm development” in the state. AWEA Deputy Director John Hensley said reversing that legislation could also bring in “$440 million in land lease payments to farmers and landowners over the next three decades,” and that “the economic benefit will just snowball from there.”

Legal Developments, Regional Updates, State Updates

HB 455: Attending port board meetings by teleconference

Some Ohio port authorities will soon be able to hold board meetings by telephone or video conference, thanks to legislation signed by Governor Kasich on January 4, 2017. Pursuant to Substitute House Bill 455, port authority boards of directors will be able to conduct their meetings by interactive video conference or teleconference if they meet certain requirements set forth in the bill. Among other things, a video or telephonic meeting must have a primary location that is open and accessible to the public. In addition, meeting materials must be distributed before the meeting, if available, or otherwise provided to the board during the meeting. This legislation represents a significant change to the open meeting requirements that are generally applicable to public bodies in Ohio. However, before utilizing the new authority, a port board will need to adopt rules implementing the authority according to requirements dictated by the statute. For example, the policy must provide that not more than one board member remotely attending a board meeting may be physically present in the same location. Substitute House Bill 455 is expected to take effect during the first week of February 2017. For more information, the see the full text of the bill. 

Legal Developments, Regional Updates, State Updates

Webinar: Lame Duck Legislative Economic Development Update

Economic development issues were at the heart of the bustle of activity as State of Ohio legislators worked to wrap up the 131st General Assembly before the year’s end. Learn how to implement changes made to the law; join Bricker & Eckler attorney Chris Schmenk, along with Dave Robinson and Nate Green of the Montrose Group, for an Ohio Economic Development Association webinar covering these legislative changes. Topics include a new commercial property tax abatement program, and changes to Ohio’s TIF law and its Downtown Redevelopment District program. The webinar will take place January 12, 2017, from 9:30 a.m. to 10:30 a.m. To register, click here

Legal Developments, State Updates

IRS issues new safe harbor provisions for management contracts

The Internal Revenue Service has announced a new safe harbor for management contracts relating to certain bond-financed facilities.  Rev. Proc.  2016-44 aims to provide what it characterizes as a “more flexible and less formulaic approach” to the question of whether an arrangement with a service provider could adversely affect the tax-exempt status of governmental bonds and qualified 501(c)(3) bonds under the Internal Revenue Code of 1986, as amended.  The new safe harbor permits longer term arrangements between the beneficiaries of tax exempt bonds and service providers without adversely affecting the tax status of those bonds. For more, read the full article.

Federal Updates, Financial Incentives, Legal Developments

Ohio House passes bill creating option to exclude property from TIF incentive districts

Legislation creating a new opt-out procedure for tax increment financing (TIF) incentive districts passed the Ohio House of Representatives on May 25, 2016. House Bill 12 would apply to any incentive-district TIF created by a county, municipality, or township. In creating such a TIF, the applicable jurisdiction would be required to identify an “overlay” district surrounding the TIF, including up to 300 acres in the shape of a square or rectangle, with no side of the overlay exceeding twice the length of its shortest side. The owner of any property not located entirely within the overlay would have the right to exclude the property from the TIF through a new written opt-out procedure. The text of the bill is available online at: For more information, stay tuned to DevelopOhio. 

Legal Developments, State Updates

Port authorities say proposed federal regulations could hurt their operations

Port authorities from Ohio and Oregon and a wholesale electricity provider from Nebraska warn that rules proposed by the Internal Revenue Service and the Treasury Department “could hurt their standing as political subdivisions and their ability to issue bonds as well as complicate their governing structure,” The Bond Buyer reports. The new regulations would require that “political subdivisions serve a governmental purpose ‘with no more than an incidental private benefit’ and be governmentally controlled” to issue tax-exempt bonds, according to the article. Chris Burnham, president of the Development Finance Authority in Summit County, Ohio, said, “[m]any Ohio port authorities provide financing that can be construed as private benefit — we issue tax-exempt revenue bonds for parking garages and other public infrastructure through tax increment financing, which under state law, does benefit a private development project.” Cleveland-Cuyahoga County Port Authority chief financial officer Brent Leslie also said the proposed rules could be “problematic,” saying, “some additional clarity around the definition of control would make sure that ports, airports, and other special units/districts have the ability to continue to issue tax-exempt debt for the benefit of the citizens we represent.” A public hearing will be held June 6.

Federal Updates, Legal Developments, State Updates