With the state legislature and Congress back in full session, Ohio Farm Bureau’s policy department has been busy examining various proposals that impact agriculture such as taxes, water quality and nutrient application. That means testifying at hearings, having one-on-one meetings with lawmakers and talking with university, business and various ag groups on how these proposals affect them.
Here’s a look at some notable bills introduced in Ohio and in Congress by Ohio congressmen, as well as Gov. John Kasich’s tax proposals.
Senate Bill 1
This bill is a new version of House Bill 490, an algae-related bill that didn’t move at the end of last year because of unrelated amendments in it. The bill is sponsored by Sens. Randy Gardner, R-Bowling Green, and Bob Peterson, R-Sabina. Among the bill’s highlights:
- A ban on the application of fertilizer and livestock manure to frozen and snow-covered ground in the Western Lake Erie Basin.
- Phosphorus monitoring at water treatment plants.
- Updated sewer rules.
- A ban on open-lake disposal of dredged material from ports and harbors in Lake Erie.
House Bill 61
This bill would restrict fertilizer and manure application in the Western Lake Erie Basin on frozen, snow-covered or saturated ground. There are exceptions built in to this, though. The bill does not contain the transfer of authority from the Ohio Department of Natural Resources to the Ohio Department of Agriculture on manure regulation and enforcement on non-permitted livestock farms. Unlike Senate Bill 1, the bill does not have an emergency clause, meaning it will not take effect upon the governor’s signature.
OFBF has been testifying about these two bills as well as detailing the voluntary measures farmers and agribusinesses have been taking to address water quality concerns. “Clean water cannot come at the expense of food production nor can farming trump the need for clean water,” according to OFBF’s testimony.
Section 179 Small Business Expensing
Ohio Congressman Pat Tiberi recently reintroduced a bill that would make permanent the Section 179 levels effective during the 2010-2014 tax years. That would allow taxpayers to expense up to $500,000 in investments in property, equipment and computer software with the deduction phased out after investments exceed $2 million. Right now, if no changes are made, the expensing levels will drop to $25,000 with a $200,000 phase-out starting Jan. 1. The House has approved the bill, which is supported by Farm Bureau.
This week, Ohio Congressman Bob Latta reintroduced legislation to permanently repeal the federal estate tax. Better known as the death tax, this is a tax on an individual’s right to transfer property at his or her death. Farm Bureau supports this bill.
GOVERNOR’S BUDGET PROPOSAL
Gov. John Kasich has released his recommendations for the state’s two-year operating budget. The budget includes funding for key agencies and programs important to agriculture, tax policy and numerous other provisions. Farm Bureau is closely analyzing the proposal to see how it addresses the organization’s 2015 priority issues.
Among those priorities is supporting water quality programs that produce science-based data and strategies to protect Ohio’s water resources. Programs that help meet this need are the Ohio Agricultural Research and Development Center, OSU Extension, OSU’s Sea Grant program, Heidelberg Water Quality Lab and the state’s Soil and Water Conservation Districts. All of these programs are proposed to be flat funded in the governor’s budget.
Another priority is ensuring the Ohio Department of Agriculture (ODA) receives funding to effectively execute its core mission as well as new responsibilities gained in recent years. Kasich’s proposal includes a 7 percent increase in funding for ODA, including increases in many of the department’s core programs.
The governor has again proposed sweeping tax changes in his budget proposal. Major provisions of the plan include:
- An across-the-board income tax cut of 23 percent, increased personal exemptions for low and middle-income wage earners and a 100 percent income tax deduction for small businesses with income below $2 million.
- The sales tax would increase by 0.5 percent and would be expanded to certain services.
- The Commercial Activity Tax (CAT) rate on gross receipts would increase from .26 to .32 percent. That increase would be offset by a reduction in the Annual Minimum Tax for ratepayers with receipts between $1 million and $2 million.
- The new severance tax rate would be set at 6.5 percent on the volume of oil or gas. Natural gas liquids would be subject to a lower tax rate of 4.5 percent. A portion (20 percent) of the new severance tax revenue would be earmarked for local governments for infrastructure and economic development purposes.
The House of Representatives recently introduced Kasich’s proposal as House Bill 64 and have begun formal deliberations.