Like the farm fields across Ohio lately, a little dust has been flying down at the Statehouse in Columbus. Our legislators are back to work and considering several bills that could affect agriculture. A few bills aren’t seeing much action, though. Here’s a summary of recent activity and inactivity at the Statehouse.
Newly introduced bills
H.B. 440 and S.B.241 – Agricultural Linked Deposit Program. This pair of bills introduced on September 30, 2021 by Representatives Swearingen (R-Huron) and White (R-Kettering) and Senators Cirino (R-Kirtland) and Rulli (R-Salem) is one of three bills in the “Ohio Gains Initiative” offered in partnership with Ohio Treasurer Robert Sprague. The Initiative proposes three new investment reforms affecting agriculture, health systems, and higher education. The agricultural proposal in H.B. 440 and S.B. 241 would expand the current Ag-LINK loan program that provides interest rate reductions of up to 3% on operating loans. The bill would make the loans available to cooperatives in addition to farm operators and agribusinesses and would also remove the $150,000 cap on Ag-LINK loans. It’s been referred to the House Financial Institutions Committee and the Senate Financial Institutions & Technology Committee.
Bills on the move
H.B. 175 – Deregulate certain ephemeral water features. The bill addresses “ephemeral features”—surface water that flows or pools only in direct response to precipitation but that is not a wetland. Under the proposal, ephemeral features would be exempt from water pollution control programs in Ohio, including the Clean Water Act Section 401 Water Quality Certification Program, as proposed in the federal 2020 Navigable Waters Protection Rule now on hold. The bill would also eliminate the certification review fee for ephemeral streams. H.B. 175 passed the House on September 30, 2021, amidst strong opposition. It awaits review before the Senate Agriculture and Natural Resources Committee.
H.B. 397 – Agricultural lease law. A proposal to address termination dates and notice provisions for crop leases received its second hearing before the House Agriculture and Conservation Committee on October 12. H.B. 397 would require a landowner who wants to terminate a crop lease that doesn’t address termination to do so by providing a written notice of termination to the tenant by September 1 of the year the termination would be effective. Discussion at the committee hearing could result in a broadening of the bill to include pasture leases.
S.B. 47 – Overtime pay. The Senate passed this bill on September 22, and it has since been referred to the House Commerce and Labor Committee. The bill exempts certain activities from the requirement for an employer to pay overtime wages. Under the proposal, traveling to and from a worksite would be exempt from overtime. Performing preliminary or postliminary tasks and activities outside of work hours that require insubstantial periods of time, such as checking email or voice mail, would also be exempt. The bill now moves to the House Commerce and Labor Committee.
Bills not moving
Several bills we’ve been watching have not generated continued interest at the Statehouse, including:
- H.B. 95, the Beginning Farmers bill that would provide income tax credits for beginning farmers who attend approved financial management programs and for owners who sell land and agricultural assets to certified beginning farmers. It passed the House in late June but was removed from the agenda when first scheduled for a hearing before the Senate Ways and Means Committee on September 28, 2021.
- H.B. 30, the bill adding marking and lighting requirements to animal-drawn vehicles, also passed the House in late June but has not seen action since its second hearing before the Senate Transportation Committee on September 22, 2021.
- H.B. 385, which would prohibit municipalities in the Western Basin of Lake Erie from discharging waste into those waters, fine those who do, and revoke NPDES permits for municipalities owning treatment works or sewerage systems within the Western Basin. The bill received one hearing before the House Agriculture and Conservation Committee on September 28.
- H.B. 349, which would place a moratorium on granting permits for a new construction or expansion of a regulated animal feeding facility in the Maumee watershed if the Ohio Department of Agriculture has determined that the phosphorus load in the Maumee River exceeded a specified number. The House Agriculture and Conservation Committee has not scheduled the bill for a hearing since it was referred to the committee on June 16, 2021.
Bills now effective
S.B. 52, the bill addressing large-scale wind and solar facility development in Ohio, became effective on October 11, 2021. The bill allows county commissioners to prohibit wind and solar developments and to establish restricted areas in the county that are off limit to the developments, gives county citizens an opportunity to place a restricted area designation on the ballot, increases local awareness and engagement in review of a proposed facility, and requires decommissioning plans and bonds for approved developments. Learn more about S.B. 52 with our law bulletins and videos on the new laws, available in our energy law library.
Update: Governor DeWine signed this bill on July 12, 2021 and it becomes effective on October 9, 2021.
It’s been a long and winding road to the Governor’s desk for Senate Bill 52, the controversial bill on siting and approval of large-scale wind and solar facilities in Ohio. The bill generated opposition and concern from the outset, requiring a major overhaul early on. A substitute bill passed the Senate on June 2 after six hearings and hundreds of witnesses testifying for and against the bill. It took the House five hearings to pass a further revised version of the bill earlier this week, and the Senate agreed to those revisions the same day. Now the bill awaits Governor DeWine’s action. If the Governor signs the bill, it would become effective in 90 days.
S.B. 52 generates conflicting opinions on property rights and renewable energy. It would grant counties and townships a voice in the siting and approval of large-scale wind and solar projects, allowing a community to go so far as to reject facility applications and prohibit facilities in identified restricted areas of the county. Supporters of the bill say that new local authority would allow local residents to protect their individual property rights as well as the fate of the community. On the other side, opponents claim that the bill interferes with the property rights of those who want to lease their land for solar and wind development and unfairly subjects renewable energy to stricter controls than other energy projects.
The bill itself is lengthy and a bit tedious but we’ve organized it into the following summary. An important first step is to understand the types of projects subject to the law, so we begin with the definitions section of the bill.
Definitions – Ohio Revised Code 303.57
The bill defines several key terms used to identify the types of wind and solar projects and applications that would be subject to the new law:
- “Economically significant wind farm” means wind turbines and associated facilities with a single interconnection to the electrical grid and designed for, or capable of, operation at an aggregate capacity of five or more megawatts but less than fifty megawatts, excluding any such wind farm in operation on June 24, 2008 and one or more wind turbines and associated facilities that are primarily dedicated to providing electricity to a single customer at a single location and that are designed for, or capable of, operation at an aggregate capacity of less than twenty megawatts, as measured at the customer's point of interconnection to the electrical grid.
- “Large wind farm” means an electric generating plant that consists of wind turbines and associated facilities with a single interconnection to the electrical grid that is a “major utility facility.”
- “Large solar facility” means an electric generating plant that consists of solar panels and associated facilities with a single interconnection to the electrical grid that is a major utility facility.
- “Utility facility” means all of the above.
- “Major utility facility” means (a) electric generating plant and associated facilities designed for, or capable of, operation at a capacity of fifty megawatts or more, (and also includes certain electric transmission lines and gas pipelines).
- “Material amendment” means an amendment to an existing utility facility certificate that changes its generation type, increases its nameplate capacity or changes the boundaries outside existing boundaries or that increase the number or height of wind turbines.
Designation of utility facility restricted areas in a county – ORC 303.58 and ORC 303.59
The bill would allow the county commissioners to designate “restricted areas” within the unincorporated parts of the county where economically significant wind farms, large wind farms, and large solar facilities may not be constructed.
- The commissioners may take this action at a regular or special meeting.
- The commissioners must give public notice of the meeting and proposed restricted areas at least 30 days prior, including to all townships, school districts and municipalities within the proposed restricted areas.
- The restricted area designations shall not apply to utility facilities that were not prohibited by the commissioners in the county review under ORC 303.61, described below.
- The restricted area designations become effective 30 days after the commissioners adopt the resolution unless a petition for referendum, described below, is presented to the commissioners within 30 days of adoption.
- Once effective, a restricted area designation prohibits anyone from filing an application for a certificate or a material amendment to an existing certificate to construct, operate or maintain a utility facility in the restricted area.
Referendum on designation of utility facility restricted areas – ORC 303.59
If a county approves a restricted area, the bill sets up a referendum procedure to allow voters to have a say in the designation. Residents may file a petition for referendum and request the county commissioners to submit the designation of a utility facility restricted area to a vote of the electors in the county.
- At least 8% of the total vote cast for governor in the most recent election must sign the petition.
- The petition must be presented to the commissioners within 30 days of the resolution adopted to designate the restricted areas.
- Within two weeks of receiving the petition and no less than 90 days prior to the election, the county commissioners must certify the petition to the county board of elections, who must verify the validity of the petition.
- The utility facility restricted area designation must be submitted to electors for approval or rejection at a special election on the day of the next primary or general election that occurs at least 120 days after the petition is filed.
- If a majority of the vote is in favor of the restricted area designation, the designation shall be effective immediately.
County review of proposed wind and solar utility facilities -- ORC 303.61
Local residents and officials have expressed concerns that they’re the last to know of a proposed large-scale wind or solar development proposed for their community. Under the bill, utility facilities must hold a public meeting in each county where the facility will be located within 90 to 300 days prior to applying for or making a material amendment to an application for a certificate from the Ohio Power Siting Board.
- The facility applicant must give a 14 day advance written notice of the public meeting to the county commissioners and to trustees of townships in which facility would be located.
- At the meeting, the facility applicant must present in written form the type of utility facility, its maximum nameplate capacity, and a map of its geographic boundaries.
- Up to 90 days after the public meeting, the county commissioners may adopt a resolution that prohibits the construction of the facility or limits its boundaries to a smaller part of the proposed location. If the county commissioners do not prohibit or limit the facility, the applicant may proceed with the application.
Ohio Power Siting Board Composition – ORC 4906.021 to ORC 4906.025
The bill also responds to concerns that community members do not have a voice in the facility approval process overseen by Ohio’s Power Siting Board (OPSB). For every utility facility application or material amendment to an application, the bill would require the OPSB to include two voting “ad hoc” members on the board to represent residents in the area where the facility is proposed.
- The ad hoc members shall be the chair of the township trustees and the president of the county commissioners in the township and county of the proposed location, or their elected official or resident designees, or a trustee and commissioner chosen by a vote of the trustees and commissioners if the application affects multiple townships and counties.
- An ad hoc member or the member’s immediate family members cannot have an interest in a lease or easement or any other beneficial interest with the applicant utility facility and cannot be an intervenor or have an immediate family member who is an intervenor in the OPSB proceeding.
- The ad hoc members must be designated no more than 30 days after the county or township is notified by the OPSB that the application has been submitted and meets statutory requirements.
- An ad hoc member may not vote on a resolution by its county commissioners or township trustees to intervene in the application proceeding.
- An ad hoc member is exempt from restrictions on ex parte communications with parties in the case but must disclose the date and participants of ex parte conversations and shall not disclose or use confidential information acquired in the course of official duties.
OPSB Authority – ORC 4901.101; ORC 4906.30
There are parameters in the bill for projects that the OPSB may not approve. The OPSB may not grant a certificate for the construction, operation, and maintenance of or material amendment to an existing certificate for a utility facility in these situations:
- If the utility facility is prohibited by a restricted area designation.
- If the county commissioners have prohibited the utility facility by resolution.
- Where the utility facility would be in multiple counties, the OPSB must modify a certificate to exclude the area of a county whose commissioners prohibited the facility.
- For any areas outside the boundaries of the utility facility that were changed by action of the county commissioners.
- If the facility has a nameplate capacity exceeding the capacity provided to the county commissioners, has a geographic area not completely within the boundaries provided to the county commissioners, or is a different type of generation than that provided to the county commissioners.
Decommissioning Plans for Utility Facilities – ORC 4906.21 to ORC 4906.212
The question of what happens to a facility when its production life ends has been another issue of voiced concern. The bill establishes decommissioning procedures for facilities. At least 60 days prior to commencement of construction of a utility facility, an applicant must submit a decommissioning plan for review and approval by the OPSB.
- A state registered professional engineer must prepare the plan, and the OPSB may reject the selected engineer.
- The plan must include:
- A list of parties responsible for decommissioning of the utility facility.
- A schedule of decommissioning activities, which cannot extend more than 12 months beyond the date the utility facility ceases operation.
- Estimates of the full cost of decommissioning, including proper disposal of facility components and restoration of the land on which the facility is located to its pre-construction state, but not including salvage value of facility materials.
- The estimate of the full cost of decommissioning a utility facility must be recalculated every five years by an engineer retained by the applicant.
Performance Bonds – ORC 4906.22 to ORC 4906.222
How to and who pays for facility decommissioning is also addressed in the bill. Before beginning construction of a utility facility, the applicant must post a performance bond to ensure that funds are available for the decommissioning of the facility.
- The utility facility must name the OPSB as the bond oblige.
- The bond shall equal the estimate of decommissioning costs included in the facility’s decommissioning plan.
- The bond shall be updated every five years according to the most recent costs of decommissioning the facility and shall increase if estimated costs increase but shall not decrease if estimated costs decrease.
OPSB Provision of Approved Application -- ORC 4906.31
Under the bill, local governments would formally know if a project receives OPSB approval. The OPSB must provide a complete copy of an approved application for or material amendment to a certificate to each board of trustees and county commissioners in the townships and counties of the facility location.
- The copy must be provided within 3 days of the OPSB’s acceptance of the application and filing fee payment by the applicant.
- The copy may be in electronic or paper form.
Effect on Utility Facility Applications in Process – Sections 3, 4 and 5 of the Act
Many wind and solar facility projects are currently in process, so the bill addresses what happens to those projects should the law go into effect.
- The new law would apply to all applications for a certificate or a material amendment to an existing certificate for an economically significant wind farm or large wind farm that is not accepted by the OPSB within 30 days after the effective date of the legislation.
- An application for an economically significant wind farm or large wind farm that is not approved within 30 days after the effective date would be subject to review by the county commissioners, who would have 90 days after the effective date to review the application and act according to the provisions of the new law.
- If an application for a certificate or material amendment to a certificate for a utility facility has not been accepted by the OPSB as of the new law’s effective date, the OPSB must include “ad hoc” members in further OPSB proceedings on the application.
- The new law would not apply to an application for a certificate or material amendment to a certificate for a large solar facility that, as of the effective date of the new law, is in the new services queue of the PJM interconnection and regional transmission organization at the time the application is accepted by OPSB and the applicant has received a completed system impact study from PJM and paid its filing fee.
- If the facility has multiple positions in the PJM new services queue, all queue position in effect on the law’s effective date are exempt from the new law.
- If the facility submits a new queue position for an increase in its capacity interconnection rights, the change shall not subject the facility to the new law as long as the facility’s nameplate capacity does not increase.
We’ll keep an eye on the Governor to learn where S.B. 52’s road will end. Read the full text of S.B. 52 and further information about it on the Ohio General Assembly’s website.
Energy is a hot topic at the statehouse these days. The Ohio General Assembly is reviewing several proposals dealing with energy sources, including solar and wind facilities, oil, gas, and gas pipelines. The proposals raise a critical question about where control over energy production activities should lie: with the state or with local communities? The proposals offer contrasting views on the answer to that question.
Solar and wind projects. We reported in March that companion bills H.B. 118 and S.B. 52 were on hold due to conflicts with the proposals, which would have allowed citizens to use the referendum process to reject proposed large scale wind and solar energy developments in their communities. On May 12, the bill sponsors offered a substitute bill to the House Public Utilities Committee. The new approach in the substitute bill would allow a township to adopt a resolution designating all or parts of the township as “energy development districts.” Doing so would allow wind and solar facilities to be constructed within the designated district(s) and would prevent the Ohio Power Siting Board from approving any projects that are not within a designated district. The residents in a township, however, would have the right to petition an energy development district designation and submit it to a vote by township residents. Sponsor Sen. Rob McColley (R-Napoleon) explained that the new approach would allow a township to let energy developers know “up front” that the community is “open for business.” The committee will hear responses to the substitute bill in additional hearings, not yet scheduled.
Fossil fuel and gas pipelines. A proposal regarding energy generation from fossil fuels and gas pipelines takes an opposite approach on local control. H.B. 192, sponsored by Rep. Al Cutrona (R-Canfield) would prohibit counties, townships, and municipal corporations from prohibiting or limited the use of fossil fuels for electricity generation and the construction or use of a pipeline to transport oil or gas. About a dozen opponents testified against the bill at its third hearing before the House Energy and Natural Resources last week, with most arguing that the proposal removes rights of local communities to control their energy sources and violates the home rule authority for municipalities provided in Ohio’s Constitution. The bill is not yet scheduled for an additional committee hearing.
Natural gas. A bill that guarantees access to natural gas passed the House of Representatives on May 6, largely along party lines. H.B. 201, sponsored by Rep. Jason Stephens (R-Kitts Hill), guarantees that every person has a right to obtain any available distribution service or competitive retail natural gas service from gas suppliers, and bars a political subdivision from enacting laws that would limit, prevent, or prohibit a consumer within its boundaries from using distribution services, retail natural gas service, or propane. Opponents argue that the bill violates home rule authority and is unnecessary, since no community in Ohio has ever banned the use of natural gas. The bill was referred to the Senate Energy and Public Utilities Committee on May 12.
We'll keep you posted on the progress of these bills as the Ohio General Assembly continues to deal with the question of local versus state control of energy production and distribution in Ohio.