June 2, 2026 · General Government Committee · 16,485 words · 17 speakers · 156 segments
I call this meeting of the House General Government Committee to order. Will the clerk please call the roll?
Chair Wray.
Here.
Vice Chair Wray.
Ranking Member Brent.
Present.
Representative Byrd.
Here.
Bryant Bailey is checked in.
Representative John.
Here.
Manning.
Here.
McLean is excused.
Miller.
Here.
Oleslager.
Here.
Plummer.
Here.
Russo.
Sittenberg is checked in. We do have a quorum presented and will proceed as a full committee. Please review the minutes from the May 27th committee meeting on your iPads. Are there any objections to the minutes? Hearing none, the minutes are approved. I will now call up House Bill 582 for its fourth hearing. Anybody here that wants to speak to that? No? There was no testimony submitted, in person or written submitted for House Bill 582. I would now like to recognize Vice Chair LeRae.
That was quick.
It's for a motion.
I think my timing was impeccable. Thank you, Chair. I move to...
Wait.
I move to... I move to favorably report House Bill 582 and recommend its passage.
Will the clerk please call the roll?
Chair Wray?
Yes.
Vice Chair Wray?
Yes.
Ranking Member Brent?
Yes.
Representative Byrd?
Yes.
John?
Yes.
Manning?
Yes.
Miller?
Yes.
Oelslager?
Yes.
Plummer?
Yes.
Russo?
Sinnenberg?
Okay. Nine zero. With nine affirmative votes and zero negative votes, the bill is favorably reported. The roll will be left open until the end of committee for anyone who would like to vote. This concludes the fourth hearing on House Bill 582. I will now call up House Bill 264 for its second hearing. We have just written testimony. Okay. All right. Today we'll be considering an amendment for House Bill 264. I'd like to recognize Vice Chair LeRae for a motion.
Thank you, Chair. Chair Ray, I move to adopt amendment AM 1361760 for House Bill 264.
The amendment is in order, and members may locate the document on your iPads. Vice Chair Larray, please explain the amendment.
This amendment creates an exception to the bill that allows school districts' boards of education to disseminate a publication during the 30 days before an election about a school levy or a bond issue or the district's finances if the county auditor certifies that the publication provides only factual information and does not support the ballot issue.
Are there any objections to the adoption of the amendment? Seeing none, the amendment has been adopted. There was no in testimony submitted again for House Bill 264 Committee members may see the written testimony that is provided on the iPad This concludes the second hearing of House Bill 264 I will now call up House Bill 770 for its first hearing. Representative Glaspern, thank you for coming. The floor is yours.
Thank you. Thank you, Madam Chair, Vice Chair Leray, Ranking Member Brent, and the members of the House General Government Committee for the opportunity to testify in support of House Bill 770. As elected officials, we are all familiar with the complexities of campaign finance law. The intent of these rules is to ensure a fair and transparent election process that we can trust. However, some of those rules can create unnecessary confusion and hinder our ability to provide transparency to voters. House Bill 770 fixes one of those rules by granting campaign committees the authority to refund political contributions for any reason and establish clear terms for disclosing those refunds. By doing so, this bill prioritizes transparency for voters and creates clear guidance for candidates. The Election Integrity Commission released an advisory opinion in April of this year that addressed some edge cases for refunds, but also made clear that they do not currently have authority in law and we do not have authority in law for most refunds now. The EIC affirmed that the authority currently exists to return donations if a contribution exceeds limits, if it was made in error, if a donation was done without the contributor's approval, or if it otherwise an unlawful contribution. Current law only explicitly provides for the spending of funds to influence elections for official duties or to make charitable donations. A voluntary refund is technically not considered a permitted expenditure. This restriction is unnecessary and counterproductive. The current lack of flexible mechanisms for refunds encourages campaigns to hold on to surplus funds, even when a candidate is no longer active or no longer actively singing office. We all know of candidates across both sides of the aisle that have held onto funds for years past their last election. House Bill 770 allows funds to be returned directly to people who provide those funds, a change that could be used to benefit everyday small donors who may have more urgent need for those funds. An additional key circumstance for considering refunds is when a candidate may want to refund a contribution. Sometimes, and we've seen instances of that in the news this past year, sometimes a candidate no longer wishes to keep that donation, and under current law, they cannot donate it. They can only donate or return it. They can only donate it to charity. That charitable contribution when it is made is not clearly linked in public records to the donation that the candidate is making a charitable contribution in relation to. This disconnect hides the true intent of that transaction and obscures public records. House Bill 770 solves this circumstance by requiring Campaign Committee to report both the original contribution that was made and the subsequent refund as an expenditure in financial reports. Voters deserve the right to be able to easily look and see if a candidate is claiming to have donated a contribution to charity, the tie-in and how much they returned to charity. The bottom line is that the existing refund law complicates what should be a straightforward process and doesn't serve a public interest. By creating a clear transparent mechanism for contribution refunds we can give campaigns the flexibility they need and give voters the transparency to see what going on Thank you for the opportunity to provide sponsored testimony I'd be happy to answer any questions.
Thank you very much, Representative. Are there any questions for the representative? Representative Russo?
Thank you, Madam Chairwoman.
Thank you, Representative.
This has always perplexed me in our campaign finance laws. Just a quick point of clarification. So in your legislation, the allowed refund amount, does it have to match the original contribution? Can the candidate or elected official or campaign committee decide an amount? So for example, the example that you gave, say someone doesn't win their primary, they've got money left in their campaign account. Do they have to give back to donors in a specified amount? Can they divide it equally? Can you just walk through that scenario and specifically what your... So in that circumstance you describe, you know, campaign ends, say, in an example, you raised $100,000, but you have $5,000 left at the end.
This bill doesn't require the campaign to disperse that fund in any specific way. If they want to give $25 back to every $25 donor until they run out of funds, that's up to them. If they want to prorate everybody, that's up to them. Under existing campaign finance law, in theory, every single contribution you could write down as a loan, and you could refund people that way, but it would be immensely cumbersome to do that under the current process. but under repaying of loans you don't have a requirement to again which order in which you return funds this doesn't require that order but I would anticipate in terms of documentation if you made a refund it would show up in the same form as the 31 I believe N that loans are right now
Representative Brent
Thanks Chairwoman from the Chairwoman to the witness thanks for coming before our committee My question is that has there been any public situations where we've seen on the news or heard about where people wanted to be able to give donations back because maybe the person who gave money was a problem?
And I'll just speak back in 2019. We had a situation here where everybody named Mama was giving back their donations tied to a particular vote. Has there been anything else that's happened recently that is causing an uproar that people want to see this action done? So I have served as a treasurer for candidate committees for over 20 years now. At the beginning of my career in Cuyahoga County, we had a big scandal, and it led to a change in government. Everybody wanted to return contributions from the people that were convicted in that scandal. They couldn't do it. This has been a persistent issue for decades across the aisle, across public officials, private individuals. Quite frankly, there are instances in which your campaign may raise funds from someone. They seem okay. They've been okay. They've been a member of the community for years. But then something comes out that no one knows about, and you want to do something to demonstrate that you don't want to be associated with that. You want to donate to charity. Well, say you've got three different contributions from that person over years, and that totals $300. dollars you donate to charity someone looks at your campaign finance report they just see a donation to charity They don know that that corresponds to how much you raised over the years or what you donating it for It just says you donated it to charity We're not providing any clarity to folks that if they want to encourage officials to return funds from a source that they think isn't right, the public has no way of knowing. They just can guess and say, oh, well, I see you raised $300 from a questionable person, and I see there's a donation here, but how do I know that they're tied together? Thank you, Chair.
Any other questions for the witness? I have a quick one, Representative.
A couple of months ago I received a very odd amount check. It was $122. For somebody who had contributed to me and I knew in the past, we deposited it. But I got to thinking about it. I called her, and she pays her bills online. and unfortunately selected me when she probably should have been selecting the utility bill. So I called her and let her know about that. But would your proposed legislation now allow me to return that check to her out of my campaign committee?
Yes, it would be straightforward that you could do that. I will say that under the advisory opinion that was issued in April, I would consider the circumstance you described to be done in error. I would say you have the authority to do it now. But, again, that is a very recent development, and the errors and the overages are the vast minority of cases. It's usually, again, the normal circumstances. Somebody's campaign ends, you still have funds, and people sit on it for a long time because they're not allowed to return them. And then they, you know, very slowly contribute to other causes that they like.
Representative Leray.
Thank you, Chair. Has there been any discussion with the recipients of these donations, the charitable organizations?
I have not had any conversations. I mean, again, usually when people donate to charity, if there's some kind of scandal, it's associated with what that scandal is. So there's not like a funds always go to a certain constituency group that I could talk to. But quite frankly, I think this would help provide more – value is not the right way to say it, but make it more beneficial to return funds to charity in a circumstance where you want to return funds, but maybe the person has done something wrong or illegal. This makes it cleaner for you to do that. Right now, you make that charitable contribution, and it's just out there by itself as an isolated thing that shows up on your report months after you did it because that's just the way that reports work.
Any other questions? Representative Briscoe?
Sorry, just one more quick follow-up from my colleague's question. Just to be clear, your legislation doesn't prohibit campaign committees from contributing to charities, so they could choose to do that, or they will now have the additional option to do a direct refund to the contributor.
Yes. Under current law, you are allowed to, any candidate for any office in Ohio is allowed to donate their funds to charity, no questions asked. What this would do is create an optional that if you wanted to identify, I don't like $300 from Rep. Chris Glaspern's campaign committee, that I can signal $300 originally came from his committee and I am donating that $300 to the Greater Cleveland Food Bank.
I see no further questions. Thank you very much, Representative.
Thank you very much.
This concludes the first hearing on House Bill 770. Call up House Bill 388 for its first hearing and welcome Representative Williams and Jerrolds to the podium. Good morning, gentlemen. The floor is yours.
Good morning, Chairman. Thank you, Chairwoman Ray, Vice Chair LeRae, Ranking Member Brent, and members of the House General Government Committee. Thank you for the opportunity to testify on House Bill 388 today. I would also like to thank my joint sponsor, Representative Jerrolds, for his work on this bipartisan issue. Over the last several years, GOP-1 medications have become increasingly common and an increasingly common tool in chronic weight management and obesity treatment. At the federal level and throughout the private sector, there have been a noticeable shift towards expanding access to these medications through direct-to-consumer programs and other health care delivery systems, including programs like Trump-Rx. As these programs continue to grow, states will be prepared to adapt alongside those changes in a responsive and measured way. House Bill 388 legislation I am proud to sponsor seeks to help state employees continue to have access to federally approved GOP-1 medications used for chronic weight management. Specifically this bill allows reimbursements for out-of-pocket costs associated with FDA approved GOP-1 medications purchased through manufacturer direct-to-consumer programs or participating pharmacies. The legislation also prohibits reimbursement for compound versions of of these drugs. In this legislation, reimbursements are available for a maximum of 24-month period, with reimbursement amounts reduced during the second year of eligibility. The legislation also requires physician verification of eligibility standards, including BMI thresholds, as well as documentation of out-of-pocket costs for reimbursements before they can be approved. Additionally, the bill establishes standards for reapplication if significant weight gain occurs following treatment. As legislators, it is important that we recognize where healthcare policy and treatment options are moving while also ensuring taxpayer dollars are being used responsibly. For many individuals, obesity and related conditions contribute to long-term healthcare costs and other preventable health complications, often costing the taxpayers in the long-term when Medicaid resources are used to combat obesity-related complications. Providing access to federally approved treatment options through a structured reimbursement program is a practical approach that reflects the directions many healthcare providers, manufacturers, and federal policy makers are already taking. And I want to be clear, state employees currently have the ability to become eligible for reimbursement if they enroll and are accepted into a program offered by our insurance, known as VRDA. This program is an unnecessary burden on the Ohio employees. And how do I know? In an effort to know exactly what is going on in this program, I enrolled a few months ago. So I've been on GOP-1 since I first came to the legislature. At my heaviest, I was 458 pounds. I've had weight loss surgery in 2013. I had a gastric sleeve. I lost 200 pounds and then regained it while I was in law school. GOP-1 was a medication. When I got in the General Assembly, I was over 330 pounds. I was able to get down to 185 pounds in the last General Assembly. Because our insurance discontinued coverage, I stopped using GLP-1s and regained 35 pounds since I stopped. In an effort to get back on GLP-1s, I was going to pay it out of pocket, but I decided to see exactly what the Virta program was about. So now on a daily basis I have to take my blood sugar even though I not diabetic On a daily basis I must prick my finger to track my ketones I must daily log every ounce of food that I eat I must daily step on a scale that measures my weight and reports it back to the government exactly how many pounds I am at a particular day. And if I am under the weight threshold by even 0.1 pounds, I instantaneously am not allowed to take GOP-1s or get reimbursement under the state health care plan, as DAS has instructed currently. So I know exactly what's going on with this program, and these are unnecessary burdens in order for state employees to be able to access life-changing drugs that are federally approved and were previously approved for direct payment through our insurance policy before there was a change by DAS. I appreciate the opportunity to speak in support of this legislation, and I'll turn it over to my joint sponsor before we open it for any questions.
Chair Leray, Vice Chair Leray, Ranking Member Brent and members of the General Government Committee, thank you for allowing us to provide sponsored testimony on House Bill 388. My joint sponsor, Representative Williams, did a great job kind of covering the specifics of the bill, but I want to talk to you about something deeply personal. For a long time in this country and frankly in the state, we have treated obesity as a character flaw instead of what medical professionals have repeatedly told us. It is a chronic disease. We have built culture where people are often judged before they're helped. People are told to simply try harder, have more discipline, or make better choices, while many are battling genetics, trauma, stress, poverty, food insecurity, hormonal disorders, mental health challenges, chronic illness, and medications that contribute to weight gain. Too often they are carrying those burdens in silence. Members of the committee in Ohio was hurting. Nearly 37% of Ohio adults are living with obesity, and millions of Ohioans are living with hypertension, heart disease, sleep apnea, diabetes, and other chronic illnesses connected to obesity and metabolic health. But behind these statistics is a human being, a mother trying to live long enough to see her child graduate, a father trying to lower his blood pressure, public servants quietly battling diabetes while still showing up for work every day. There are people who have tried diet after diet, program after program, only to feel defeated, ashamed, and ultimately invisible. House Bill 388 says to those high-owners they deserve dignity, too. This legislation creates a reimbursement program within a state employee health plan for FDA-approved GLP-1 medications used for chronic weight management. This bill is structured intentionally and responsibly. It limits reimbursement eligibility to help FDA-approved medications, excludes compounded drugs, requires physician verification, establishes reimbursement caps, and creates a time-limited reimbursement period. Let me tell you what this bill is not. It is not about vanity. It's not about celebrity trends or social media conversations. This bill is about public health, about prevention, and about giving people access to medically appropriate treatment before their health declines even further. Because right now, the Ohio, state of Ohio, is paying for the consequences of obesity while refusing to help address the disease itself. We pay for it in diabetes complications, amputations. We pay for it with heart disease. We pay for it in strokes and hospitalizations. And again, many Ohioans are being told that they cannot access tools that may help prevent these outcomes in the first place. Members of the committee I know what it feels like to fight for your health I also was on a GLP I lost over 45 pounds and that was before we were able to get taken off And so I know what it feels like to have this stress on you and I know what it feels like to struggle with weight while balancing public service trauma life itself And I also know that many people never ask for help because they are afraid of being mocked instead of supported. I believe we can build a healthier Ohio if we remove the shame from the public health strategy. And House Bill 38 recognized that health care should meet people where they are. And just want to really see this bill move and have an open and honest conversation about GOP-1 access for everyone. But let's start with our state employees and those who work on behalf of our government. So Chair Leray, Chair Ray, Vice Chair Leray, Ranking Member Brent and members of the House Government Committee, thank you, General Government Committee, thank you again for the opportunity to provide some testimony on House Bill 388. And I'm just excited to have any questions, answer any questions you have at this time.
Thank you very much, gentlemen. Representative Brent.
Thank you, Chairwoman, to our witnesses. I'll just say I guess technically, according to the state standards, we consider as obese. But I've never been on GOP-1. I'm not a diabetic or anything like that. But I know GOP-1, I'm just stating out facts, was originally made for those who are diabetic. And I know within the past year or so, we've had major shortages of GOP-1 products because people want to use it for other things, if it's diet or for whatever reason. When we look at this bill, if you're, according to lines 42 through 44, you said you, if you have a body mass index of 25 to 29 percent, you consider it's overweight. But according to your bill, you have to be at least 30 percent of your body mass index to be able to receive this GLP-1. Why was that put in this bill like that?
Through the chair to the ranking member, what we were looking to do was cut down on the number of people that were eligible to cut down on cost. We have had a conversation with the manufacturers who would like the body mass index to exactly match what the FDA standards are, and that's our intention in the bill is to match them identically. I'll show you how fast this stuff is moving. So the reimbursements in the bill start at $500 and tie trade down to $250. Well, that's back when your high level of GOP-1 was costing $499. Now it's $350. So we will actually need to amend down the cost reimbursements because it's moving so fast that the costs are coming down on these drugs. And, yes, there was a shortage initially. So the GOP-1 that I'm on with, Govi, was specifically FDA-approved for weight loss and could not be used for diabetes. But we still had a shortage initially, and it was about ramping up manufacturing due to demand. Now, actually, demand has matched supply, and there has been a steady stream of GOP-1 access, including new pills that were approved by FDA, so you wouldn't have to take an injectable medication. I think it's important to note, like, we can get in a long discussion about GOP-1s. It's important to note that in our current insurance plan, you can go to your doctor and get other weight loss drugs under our insurance plan, such as Topamate and Fentremine, which I was on. So Topomate is an appetite suppressant. Fentramine is supposed to help your metabolism. Well, I was on that for about three months, and I had insomnia. And I couldn't figure it out until I started Googling what fentramine was. Fentramine is a synthetic version of meth. So under our current way of doing business in the state of Ohio, we not going to allow people to get GLP which have been around for decades and proven to help with weight loss with very small complications But instead our insurance company will put you on a synthetic version of meth in order to lose weight That shows you how crazy this posse was. And the only reason GOP-1 coverage was stripped away from us in our health care is because we had an explosion of health care costs here in the state of Ohio because health care costs went up overall. And GOP-1 was very low-hanging fruit. It was $40 million for about 3,200 to 3,500 state employees. And DAS decided to cut it off entirely without any research. So what happened? We got together, drafted this bill, and introduced it. And within 60 days, DAS responded with the Virta program. In response to this legislation, they introduced the Virta program. So I wanted to get on it and see what it is. And every day now, everyone knows my weight because every day I have to step on a scale that is attached to the Virta app where my assigned caseworker knows exactly how much I weigh at 7 o'clock in the morning before I got on the road to get down here. So I think that's a little intrusive, and I think it should be up to our doctors to determine if it's medically necessary. And if it's proven it's medically necessary that I need to be on weight loss medication, there shouldn't be a distinction between GLP-1s and synthetic meth like fentramine that's currently approved.
I do have a follow-up.
Yes. According to line 28 through 35, it was that state employees can only be on this,
then reimbursement for 24 months. How do we come up with that conclusion? Because obviously you've been on your medication for more than 24 months. So how are we limiting people for 24 months when you've been on yours for more?
So through the chair to the ranking member, it's an effort to do what's called titrating people off. So this is why it was such disappointing to me that our insurance stopped covering it. So I've been on GOP-1 since, I think, April of 2023. I made substantial weight loss. I lost over 100 pounds. I was able to maintain that weight loss. It would, you know, I was able to figure out. And I started, my doctor started to titrate me off. So I was on a maximum dose of 2.4 milligrams. And I spreaded it out. So instead of taking an injection every week, it started every two weeks and then three weeks and then four weeks. I got all the way up to six weeks with a goal of every two months. That's how you titrate someone off while doing lifestyle changes to see if there's going to be a weight gain. We're encouraging that through the process of reducing your reimbursement over time, titrating you off, and if there's a substantial weight gain, you can re-enroll. The idea is to combine lifestyle changes with medication in order for effort for people to be able to get off. There's a lot of people that lifestyle changes may be successful in keeping their weight under management. For me, I was on prescription opioids for 10 years. It destroyed my metabolism, and I literally can't diet enough to continue to lose weight. And right now the diet that I'm on is essentially a forced carnivore diet. I can only eat 30 carbs a day. Last Tuesday I ate a banana when I woke up, and my app told me I was over my carbs for the day by eating a single banana.
Thank you, Sharon. Representative, I think Manning was next.
Thank you, Chair, and thank you both for coming in. And you're exactly right. This is about health. This is about maintaining better health. My guess is we save a lot more money by doing this than having to deal with all the other things. But how do I go back and justify to my constituents that we're willing to take their tax dollars to pay for our health, but we're not willing to do it for their health? How do we convince maybe the insurance companies or whoever is holding this up that we need to do this statewide rather than just the benefits to the legislators?
Through the chair to the member, so I've talked to my constituents about this. One, it's already covered under state health policy right now. So we're just simply saying that we shouldn't have to go through the Virta program, that we should be able to go through a state-regulated program instead of this independent vendor that's making these medical decisions. I can't even go to my primary care physician and him say that I need to be on this medication. My insurance won't cover it if he says it. But if I go to Virta, a nurse can say that I need to be on this medication, and she did. And I went from 2.4 milligrams every two months to now I'm on 0.25 and I have to start all over again. And I may not see my weight come down for six to nine months of being back on GOP-1s because there was a gap. I do believe a lot of the private health insurance carriers are covering GOP-1s now. I know I have family members that are on GOP-1s. They had to go through their eligibility through private care. And I know at the federal level, Medicaid is actually considering putting GOP-1s in the Medicaid program at the federal level. I don't think the state of Ohio is going to have the authority to say that Medicaid needs to cover it. We would have to ask for a waiver. But it is underproposable at the federal level to get GOP-1s covered through the Medicaid program for individuals that are experiencing obesity at high levels. At a certain point, I mean, I was 458 pounds. I was pre-diabetic. I have so many health complications because of six years of being that big of a guy. And now I was at my lowest point at a manageable weight, and my insurance stripped that coverage from me, and instantaneously my health has declined. And it's not just for me. Unlike members in the General Assembly, I'm not going to be back on the health insurance. I'm out of the General Assembly. So I'm going back to my private care. But my wife's health care coverage, when we have open enrollment, I think it's October, they covered GOP-1. And I'm going to transition to her health care coverage. But under state coverage right now, I can't get it unless I go through all of these intrusive measures. When previously for two years we allowed coverage, and we've done it in this bill in a cost-effective way, encouraging people to titrate off, combining it with hopefully lifestyle changes, and seeing if they can maintain their weight loss. That's the goal, and that's the way I talk to my constituents in regards to it.
Through the chair to Representative Manning, thank you, Juan, for bringing that question up. a known record. I think it's important that we do have a broader conversation about access to GOP-1s. I also agree that what we're seeing across private insurance is we're seeing, because of the evolution of GOP-1s, particularly in the daily pill, there's more access now than ever before when it comes to this particular medication for individuals to access. And so What we're saying in our bill is the overburdened restrictions that currently are in place are harming the very people that work in all of our state agencies, state facilities across the state of Ohio. And if we truly want to make sure that our state employees are healthy, why don't we reduce the barriers to access to this very important medical necessity in some cases so that these individuals can be their very best self? Because I'll tell you what it's like. I've seen family members, unfortunately, have amputations because they have diabetes type one. I've seen families, some of my family members, who had genetic predisposition for type 2. And because of lifestyle changes, because all the things are happening, I've seen, unfortunately, the magnification of negative health outcomes because we were not able to get their weight under control. And so this is a deal big deal that we should have the conversation across the state We should bring down the shame that exists unfortunately when it comes to obesity and talk about access to these important drugs that will have a real impact on the lives of Ohioans But I thank you for bringing that conversation up.
Chairwoman, may I comment just very briefly?
So the decision by DAS did not start based on health at all. It was based on cost savings. They've admitted that. It was a cost-saving measure. It wasn't a decision on whether or not GOP-1s were effective or not. This bill, when it was drafted, would have saved the state of Ohio 75% of what the prior costs were on GOP-1s, and that was because of PBMs. So the state of Ohio, because of our health insurance plan, was paying through PBMs. Even though there was all these rebates, we were paying maximum amount $1,500 a dose for GOP-1s, even though the direct-to-consumer was $500. So what we did was go through a reimbursement phase where we got around the PBMs and said, hey, employees go and purchase it, provide proof, your medical necessity, we can reimburse you, and we would have saved two-thirds right off the rip on these GOP ones. And now the costs are coming down even substantially more. So that's why some of the things like the time period, the BMI, that was all an effort for us to try to save costs as much as we can. And now with the cost savings and us needing to amend to reduce the reimbursement, we may be able to save as much as 90% of what we used to pay last year for GOP-1 coverage for state employees.
Representative Russo?
Thank you, Madam Chairwoman. Thank you to the representatives for this legislation. I'll just note before I ask my question, I happen to be the minority leader when this change happened. And in addition to cutting this benefit with no notice to employees, they also increased the premium with no notice to employees. So it was a double whammy. And really, frankly, DAS should be better at communicating across the board on these issues. But my question to you specifically is, you know, I notice on this that the, you know, essentially you're creating a health care reimbursement account and HRA to use as this. but you're limiting it only to use by the covered employee. I guess my question would be, why not have that same amount, but open it to any covered beneficiary within the employee's family? Because we're still paying for the same cost when the obesity is not treated. We're not spending more per employee. we're just ensuring that, you know, if it's not the employee themselves, but maybe a spouse or a covered beneficiary under that employee, if they have that group, if they purchase the family plan, that there's eligibility. Would you be open to that? Have you thought about how much that may or may not add to the potential eligibility to this and may or may not substantially increase the cost?
Through the chairwoman to the member, yeah, we're very open to that conversation. We were doing as much cost-saving measures as we could. I mean, the first effort was to make sure that the actual state employees that previously had coverage weren't going to get a lapse in coverage. We were unsuccessful with getting the bill through that fast, so now they would have to go through the current VIRTA program. We are open to the discussion, especially knowing what the cost savings were. When we initially did the fiscal analysis on it, it wasn't based off of just employees. When I did my calculations, it was based off of total number of covered individuals. And that was resulting in million being spent on that coverage And by reducing it just by the coverage the BMI and the cost savings we were already drastically cutting back what the state of Ohio was going to expend for GOP coverage I don't think it would be that much more, and actually I think it would be less now that we've seen the cost actually come down, so the reimbursement can come down. So I would be very open to an amendment that brings down the reimbursement costs. I prefer to have skin in the game as an employee. Hey, you pay this portion, the state pays that portion, You got skin in the game, so people aren't just getting it when they don't need it. But at the same time, I think if you have an obese child or an obese spouse, I think that they should have that coverage as well if they're under a state employee plan.
Representative Miller. Thank you, Madam Chair, and thank you, gentlemen. My question, I guess, surrounds parity, I guess, if you will. Let's say we have other state employees that are taking other types of medications with a rather large out-of-pocket payment. They see this, that we're covering the GOP-1s, yet their medication they're still having to pay out-of-pocket for. What would you say to those employees, or how would you address that?
Through the chair, to the members, I'm not aware of many FDA-approved drugs that our policy doesn't cover that are specifically used for FDA-approved condition. I am aware of FDA-approved drugs that doctors are prescribing off-label that our insurance won't cover because you're using it for an alternative purpose. If there was specific drugs, I would be open to the conversation.
Other than that, if there's out-of-pocket costs associated with an FDA-approved drug that our insurance covers, that's been negotiated through our health insurance plan on what our out-of-pocket costs are for that covered prescription. That's normal negotiating and collective bargaining and things of that nature. I don't want to overturn the cart when it comes to those negotiations that were previous. This is a unique one where we have FDA-approved drugs specifically being used for FDA-approved condition that just was cut off with no notice. And even when I met with DAS and I said, have you tried these 10 things that could do cost savings? And their answer to me was no. We didn't consider any of that. We're just going to cut it off. And I asked for two weeks. I said, can you give me two weeks to bring in the manufacturers and see if I can work out a special deal just for Ohio? And they said, well, think about it. And a week later, the e-mail hit with the letter from DAS saying that the coverage was going to stop. So if there are specific drugs that I can become aware of that are FDA approved and you're trying to use it for an FDA approved condition and are assurances covered, I would be open to that conversation. Thank you. Representative Brian Bailey. Any further questions? Okay, this concludes the first hearing on House Bill 388. Thank you very much, gentlemen. I will now call up House Bill 779 for its first hearing. If we could have Representative Pizzouli and Representative Brader for sponsor testimony. Welcome, gentlemen. The floor is yours.
Thank you. Vice Chair LeRae, Ranking Member Brent, and members of the committee, thank you for the opportunity to provide sponsored testimony on House Bill 779, the Jobs Ohio Transparency Act. We introduced this legislation because we believe economic development works best when it is both aggressive and accountable. Ohio should absolutely compete for jobs and investment but no state entity handing billions of taxpayer resources should operate without meaningful transparency and oversight Over the last three years, I have attempted to work collaboratively with Jobs Ohio on behalf of my district and the broader Appalachian region. I came into office believing Jobs Ohio could be a transformational partner for communities like mine that have spent decades fighting economic decline, population loss, an addiction crisis, and the collapse of legacy industries. Instead, I repeatedly encountered barriers. When Scioto County was at our lowest point trying to rebuild our economic development corporation, we asked for financial help and were told no. When I sought assistance to help preserve a major employer in my district, we were told no. When I proposed broader long-term strategies for Appalachian revitalization, including a regional initiative focused on infrastructure, workforce, and recruitment, I was told no. At some point, after enough conversations lead to nowhere, you begin asking a simple question. Who exactly is JobsOhio accountable to? And that question is what has led to this bill. Ohio's economic development structure is unusual. Let's talk about that. We were effectively a national test case. Few states have delegated this level of economic development authority to a private nonprofit structure tied to public assets and liquor revenues. And several states that experimented with similar models eventually backed away after concerns over transparency and accountability. Even conservative reformers in states like Florida recognize the problem. Governor Ron DeSantis and Republican lawmakers restructured Enterprise Florida after concluding that government-connected entities cannot simply claim to operate, quote, at the speed of business, unquote, while avoiding the level of public scrutiny expected elsewhere in government. Because when public money and infrastructure are blended with private operations without transparency, trust erodes. That is what this legislation is all about. We're trying to restore some trust. House Bill 779 establishes basic expectations for transparency, reporting, and accountability. If Jobs Ohio is truly doing exceptional work across this state, then audits reporting public testimony should reinforce confidence in the organization and not threaten it. One issue that particularly concerned me was reviewing reports claiming significant economic development activity in my district. On paper, it looked great. Some of the numbers looked very impressive. But when you look closer, many of these projects were already happening independently before JobsOhio became involved. In several cases, it appeared that a check was written after the fact, and the project was then counted as a JobsOhio success. That may improve annual reporting, but it doesn't necessarily reflect meaningful economic tragedy or transformational investment. Meanwhile, millions of dollars in liquor profits are generated from communities like mine and flow into this system every year. Yet, Appalachia, Ohio continues to lag behind in major economic development investment. Before Jobs Ohio, those dollars went to our locals to do what was best for them. My constituents are not asking for special treatment. We're just asking to not be forgotten. I was told by Jobs Ohio that all economic development starts locally. If that is the case, why not give the money to the locals? We in Southern Ohio work hard. We pay taxes. We raise families. We deserve to know whether this system is truly serving all regions of Ohio equally or primarily concentrating resources in areas already experiencing growth and momentum. Transparency isn't controversial. It's bipartisan. This bill says that if an entity is connected to public assets, public revenue, and public policy, then the public deserves visibility into how decisions are made, where money is going, and whether promises are being fulfilled. That is a responsible government. At the end of the day, sunlight builds credibility. Accountability builds trust, and trust is necessary if economic development efforts are going to maintain public support long term. If Jobs Ohio succeeds, this bill gives them an opportunity to prove it clearly and publicly. And if improvements are needed, then we owe it to Ohioans to identify them honestly. I just want to thank the committee again for this opportunity, and I'll turn it to my friend, Representative Rader.
Thank you, Representative Zouli. Thank you, Chairwoman Ray. Thank you to the Vice Chair Leray and Ranking Member Brent for this opportunity. And, yeah, I'll just, what I'll do here is quickly kind of go through. I won't read my testimony verbatim, but we'll kind of talk about what the bill does, a little bit of history about Jobs Ohio, too, how it came to be. But back in 2013, Ohio transferred its liquor profits in exchange for about $1.4 billion in value, gave those proceeds over to JobsOhio to run externally the economic development wing for the state to complement our own economic development department's efforts. So back in last year, the controlling board approved an extension of this contract to 2053, valued at about, LSE estimated to be valued at about $16 billion. So that was a split vote on the controlling board. Jobs Ohio did not testify to the legislature then. Once approved, Ohio taxpayers may not have another meaningful opportunity to really review anything about the organization in great detail, except what's publicly available, for potentially decades. So today, Jobs Ohio receives billions in public value, yet operates with significantly less transparency than state agencies, universities, local governments. and many nonprofits that receive state funding. So what does the bill do? In short, it does about five or six things. The first thing is it requires independent audits. The bill would require that the Ohio auditor would conduct a biannual audit. This audit would include financial records, legal compliance, internal controls, operational practices. The second thing it would do is it would create meaningful enforcement. So Jobs Ohio fails to comply with statutory transparency requirements. requirements, the controlling board may suspend the funding to the organization. Some of those disclosures that are required that are outlined in the bill would be companies, it would have to disclose what companies receive assistance, sponsorships and marketing expenditures, dollar amounts spent, who approved those expenditures, conflicts of interest disclosures, and employee compensation information. Not too dissimilar from what we did last week. We approved the Ohio checkbook, making all local governments something that I think was, I think we unanimously voted for by all of us. We thought it was important that if you receive public dollars as a public entity that we should know who makes what within the government. And this does something similar requiring at least annually that the organization share its compensation information. It requires annual legislative testimony. I think this is very important. So Jobs of Ohio leadership must testify at least once a year before the General Assembly. This actually came from a couple other states that do something similar to have these quasi economic development offices Michigan and Indiana Indiana is I think a pretty successful version of this Has at least once every two years they have to come and testify before the Indiana legislature to receive general funds revenue. It's done a little bit differently on that part. But some of the things they have to testify about would be economic development outcomes, geographic distribution of investment, which we feel is very important to make sure that all parts of the state are receiving what they're putting in at the end of the day, job creation metrics and program performance. The fifth thing would be increasing transparency around future liquor revenues agreements. So if and once they come back to the controlling board for an extension of that contract again, it would require at this point legislative review. We think it's very important. And also to have public hearings and an independent evaluation of what would happen so that it doesn't happen kind of behind closed doors in a black box. So a couple examples of what compliance might look like under this bill. Jobs of Hyde would have to publish sponsorship, different types of expenditures related to sponsorships and marketing, disclose who approves major expenditures, provides conflict of interest reviews, reporting compensation data required by this law, and it would also have to cooperate with the Ohio State Auditor's reviews. What would be out of compliance, I think it's important to note. If you refuse to disclose sponsorships, obviously failing to identify recipients of public funds, omitting conflicts of interest, things like that. So what this bill doesn't do, this is very important, it's all very important, but what this bill doesn't do, it doesn't eliminate Jobs Ohio. It does not reduce economic development funding. It doesn't dictate what projects receive support. It does not prevent Ohio from competing for jobs. This doesn't change anything about how we operate as a state when it comes to economic development on its face, going into these projects. Jobs Ohio can operate how they operate today under this bill. It's just after the fact that it allows us to see better how these things are being done and what outcomes there are and better tracking, better transparency, better accountability. So the bottom line here is this bill is not about whether Jobs Ohio is successful or unsuccessful. It's about whether Ohioans can evaluate that success for themselves and I will leave it at that. I really appreciate the committee for its time and we welcome any types of questions.
Representative Brent.
Thank you Chairwoman from the Chairwoman to the members, to the representatives. One thing that's been very interesting is that we are in the age of podcasts and if anybody likes doing a two plus hour drive, drive, I'm the queen of listening to a good podcast in my car. And it looks like a couple months ago, or whatever time ago, I'm not going to get into the details of that, it was a podcast that Jobs Ohio sponsored called The Call Out. And they sponsored it what was it, $15,000? I don't know how much it was. Something like that. It was money that was spent on a podcast that does a lot of things. How would this legislation exactly address when JobsOhio wants to sponsor a random podcast?
Through the chair, thank you for that question, ranking member. What this would do is JobsOhio would have to track and then report how it's spending those expenditures so that we could see on an annual basis how that money is being spent and who's receiving it. So in this case, that would be on the report that we could then see exactly who's getting And then we can go back and check and see if it's actually being spent in a way that's kind of comporting with our mission and vision. Just a quick follow-up. Yes.
Also too we dealing in a time where we lived through House Bill 6 where that was a whole sham with the first energy bailout I lived through the Cahoga County scandal That was an embarrassment. And now we're dealing with things with Jobs Ohio. This seems a little embarrassing, too, right now. How can this make sure that we do not fall into a system of backroom deals, favoritism? Because they say Ohio is the worst in the nation when it comes to political corruption. So how can this bill stop things like that?
Thank you, Chair. Thank you, Chair, and thank you, Representative. In my testimony, I mentioned sunlight, and if we can shine light on an organization, it gives public trust and transparency. I truly believe that had this bill been passed, we wouldn't have seen such an embarrassment happen to our state. I hear the podcast had two episodes. that's some money. My district, I think, sees this, and we're a little offended when I represent one of the poorest counties in the state. Imagine what could have been done to a place like Scioto County in our local economic development had we been given $50,000 to help a few good-paying jobs to lift people up out of poverty. Seeing that go to a podcast, it's kind of embarrassing to our state. So thank you for that point.
Representative Plummer.
Thanks, Chair. Thanks, gentlemen. So in your opinion, has JobsOhio been a pretty good economic driver for Ohio? Have we increased jobs or are we having that loss of jobs?
Thank you, Chair. Thank you, Representative. I guess it's probably hard to say. I appreciate that question. That's a pretty nuanced question. have we increased jobs since Jobs Ohio has been created? I guess one could say the number of jobs have increased in this state since then. Is that tied directly to Jobs Ohio? I don't believe they or myself had any fact to prove that they have helped increase jobs in this state. No.
And I'll answer that if I may, Madam Chair, and thank you for the question. I just want to know. I won't go as far as to say the jobs that have been created since Jobs Ohio are connected or aren't connected to Jobs Ohio. They put out big numbers. And if you go and you look at the actual individual projects, you know, talk to the businesses in my community that they claim are the recipients of those jobs that have been created, the contributions from Jobs Ohio is relatively small. They actually took me on a tour, and I appreciate this. Team Neo took me to three businesses in my district. And I got to see some of the work they had done. And one of the businesses received a small grant for a $1.2 million machine. I mean, it was a few thousand dollars for a $1.2 million machine from Jobs Ohio, yet they claimed that created jobs. Now, they had a small role there. The company was very appreciative of the small grant they got. The company was already purchasing the piece of equipment. So all we want to do is instead of finding out kind of after the fact and through meeting these companies in our districts, We'd like to see a much more detailed, granular understanding of how these public dollars are being spent so we can kick the tires and understand better how these economic development instruments are actually being used to create the jobs that are claimed to be created. So I think that's what we're trying to do with this bill. And again, nothing in this bill would necessarily change what Jobs Ohio is doing today. In fact if they are creating the jobs and doing the things that they doing I do believe that there shouldn be any problem with what we asking for today It just about transparency and accountability at the end Representative Yes Well in my region they been very successful You know, we actually have roadways, infrastructure, water, sewer, so it's been very successful in our areas. I don't mind tweaking some things and, you know, flipping over a few rocks, but to answer my own question, they've been very successful in my opinion. Thanks, Chair.
Representative Russo.
Thank you, Chairwoman. There we go. Sorry, I turned myself off again. Thank you, Chairwoman. Thank you to the representatives. My question for you, and Representative Pazula, you referenced, you know, Florida had sort of pursued this model and then had concerns about the transparency issue. Are you aware? I mean, how do we compare to other states that have these entities in terms of, you know, what I see is just the lack of transparency. And I think that that's the big concern here because, you know, we've essentially given Jobs Ohio access, full access to the liquor license profits in this state, which, as you know, I can't remember whose testimony, you know, totals about $16 billion through their now extended contract to 2053. that's an incredible amount of resources with almost no transparency in what is the return on investment there. And so I'm just curious, you know, as you're looking across other states, you brought up, I think, Michigan and Indiana or many other states that have similar entities. entities, how do we compare in terms of transparency and accountability, especially to a legislature or really the public?
Through the chair to the representative, thank you for that question. Touched on a lot of great points there. I would just say that we are the only one. We have the least amount of transparency when you compare of any state that I have personally researched. You look at a state like and then, you know, let's just bring to mind maybe it's a maybe it's a process that could work. Tennessee does something similar, although they do have more transparency and accountability. But, you know, my business that is going to be leaving my district in Jobs, Ohio, told me no is locating to Tennessee because they were offered very good incentives to be able to relocate there. And so that's a model that is similar to the state of Ohio, but it seems to be working very well in Tennessee. So to me, it might be beyond that what's actually occurring. That's exactly why we need the accountability. In Florida, Governor DeSantis broke it up. He said it's just not working. When you combine government with no transparency, you're just getting the worst of both worlds on that. And, you know, for example, the reporting, there's a lot of questions about the reporting that I have. Because when I look at a business that's being reported in my district, Jobs Ohio will come in, give me a really nice report, and it says, well, we invested $30,000 into your district on this project. When I look up through LSC how much liquor profits are taken out, it was around $2 million. Is Sayota County getting $2 million back on that return? No. So we're actually getting taxed on something that we're not receiving the $2 million back. First of all, it's going maybe to Dayton or wherever else. But when I look at those reports, they say, well, we invest. $5,000 into this business, so I called the business. Was this project happening whether JobsOhio was involved or not? Yes, it was. They gave us a call, showed up, and wrote us a check, and then now it's in your report, and now they're taking credit for it. I don't know how successful of a model that is, and maybe if we were a little more transparent, we could get to the bottom of some of this. Thank you for that question.
Representative Sinnenberg.
Thank you, Chair Ray. Thank you both for bringing this bill forward. The provision about the auditor of state auditing every two years, that gives me some concern because the auditor of state is a politically elected position. And let's be honest, most likely it's going to be someone who maybe was a prior state rep or state senator whose district got a job Ohio award or who is a statewide elected official and goes to these Jobs Ohio ribbon cuttings for the last many years and has these relationships with Jobs Ohio. And then let's say they're an elected auditor. The audit comes in. It shows something that is alarming, whatever that may be. And then the elected political auditor could say, oh, no, we can't let this come out on Jobs Ohio. They're good. I don't believe this. I've been to all these ribbon cuttings. So with all that as background, have you thought about maybe an actual independent auditor outside of the auditor of state's office that couldn't put the kibosh on a bad audit finding? Good. Thanks.
Thank you. Through the chair, thank you, Representative Sindenburg, for the question. I think that actually through this process we met with the auditor's office, and I think there's some additional tweaks that we can make to make sure that what's currently happening, There are some basic sort of audits that happen. They sample projects over $15 million, which I thought was interesting. They only pick a couple of projects, and they sample them to make sure the structure, they don't publish anything about the project, but just to kind of give a stamp of approval, I guess. There's a couple-page report that's issued every year from the auditor right now based on Jobs Ohio, and we're working with them right now to figure out how we can port what they currently do. There's no sort of enforcement mechanism there. They just pretty much say whether, you know, generally they're compliant or not. and then there's a report that is made. So I think, to your point, I think a lot more could be done. We then met with the inspector general on this, Meyer, and I think if an amendment is to be made, we already submitted for one actually, I think the inspector general could have a larger role. Right now, as the rules currently written, the inspector general cannot do any type of investigation on their own of Jobs Ohio. They can't just come in if they see something that's amiss. They can, if there's been a formal complaint filed, then follow up on that complaint. but the inspector general has a broad authority. In fact, you're the only person that can walk into the governor's office today and go through his email if he wants any time in order to make sure that everything's above board. So I think it's really important maybe that we – something we've talked about, considered including the inspector general as kind of a check and balance. And it's definitely a check that the inspector general is also not a – it's a political appointee, but he's removed one step from that electoral process, and I think it does provide a little bit of extra – and an extra layer of protection that I think is warranted. So good question.
Representative Brent?
No?
Are there any further questions? This concludes the first hearing on House Bill 779. Thank you very much, gentlemen. I will now call up House Bill 775 for its first hearing. I'd like to invite Representative Callender and Representative DeVilla to the podium. Thank you Good morning gentlemen The floor is yours.
I'm sorry. Have we met? Jamie here. Thank you, Chairwoman Ray and Vice Chair Larray. I cannot read from here, and there are so many empty spots. I'm having trouble reading the things. But thank you, committee. I'll name each of you if you'd like. We are here today to talk about House Bill 775. It's a small little bill. I was going to ask for copies to be at each desk. It is 3,567 pages. It is slightly larger than the operating budget. And it's sad that it has to be that large to accomplish what we're trying to do. I think everybody, all of you know that I have been a professor in the past, have written a couple of textbooks on state government, and I have a two-hour lecture on the separation of powers and the checks and balances between the three branches, really isolating the conflicts and the ebb and flow between executive and legislative branch over the years. I would be happy to give that lecture. I've given it for 30 years. I can keep it to about two hours. And here's my deal with you. If we have two or less questions, I'll forego it. Third question, I'm doing it. Fourth question, I'm reading the 3,600-page bill. So what this bill does is look at, and we visit this every eight or ten years here in Ohio. We have something called J-CART, the Joint Committee on Agency Rule Review. Many of you have substituted on that or served on that. And that is the pinnacle of checks and balances between the legislative and executive branch. And the purpose of J-CART was initiated in 1977. It's been around ever since. It is there to make sure that administrative rules, executive branch rules, comply with legislative intent. That's the simple purpose. But every few years, there's what's known as administrative or bureaucratic creep, where they slowly begin to expand their jurisdiction, expand their power, and take more liberties in their rulemaking to create policies, in essence to legislate rather than simply implement or execute the laws that we put in place. What this bill does is it goes through and takes out language from the code or adjusts language in the code that agencies have been using over the last few years with more and more frequency to expand their legislative activities rather than strictly putting in place rules that comply and help implement the legislation we've passed. One of the things that we're taking out in maybe 300 places is, and implement appropriate rules or rules as appropriate. Well, they've started to take advantage, not just one agency, but a lot of agencies, take advantage of that and implement rules that they think would make good law. That's not their job. That's our job. and rather than saying they have to go, I do want to take exception to the LSC analysis because it says they have to do this they have to do that No we doing it for them in this bill We are taking that language out so that future rules will not overstep what the legislature intended them to do If there's an issue, they can bring it to the legislature, and we, as the elected representative of the people, can decide whether or not, and if so, how, to deal with any issues that come up that is not the executive branch's job. So that, quite simply, is what this bill does. Despite the length, it's actually a really simple concept. And with that, remember two questions. I will turn it over, and that includes you. So if you have a question, you can deal with it right now. I'll raise my question in the form of a statement.
In that case, Madam Chair, members of the committee, I don't have a lot more to add. One of the main reasons that I came back to the legislature was to work on this concept that we should all be familiar with, and that's consent of the governed. We in the legislature are the first branch of government. We are the branch that writes the laws. and too often over the past 120 years or so. We've seen a system primarily at the national level, but to some extent at the state level as well, as indicated by regulatory creep here, where the second branch of government, the executive branch, ends up overstepping its constitutional authority, ends up crafting legislation effectively through the rulemaking process, through unelected bureaucrats who can't be removed. We have to stand for election every two years. As I've been joking with people here recently, I've got a job interview every two years, and I have to go stand on my record, as all of us do. That's the way the system's designed. Folks that don't have to do that shouldn't have the privilege of doing the work that we do, and that's representing the people carrying out their will in terms of lawmaking. So this bill is an effort to claw back and get that process back within the confines of our state constitution. within the confines of the U.S. Constitution
to make sure that the branches are doing the jobs that they're constructed to do under our founders' intent. So I'll stop there. I'd be happy to answer your two questions, apparently. Oh, there could be more. But there could be many. Any questions for the representatives? Representative Bruce.
Thank you, Madam Chairwoman. And I will say to Representative Callender, your threat does not deter me from asking these questions. So, listen, I think there's a balance to be struck here. I guess my concern about your legislation, and maybe address this concern first, is that we almost seem to be shifting too far to, I think, an imbalance towards the legislative branch. Because I think about the executive branch, and, you know, frankly, having worked on that side before, you get bogged down in a lot of the details. of implementation. There's a huge difference between legislating and actual implementation, and there are a lot of details to the implementation piece. And I guess I worry a little bit that if, you know, we require so many of these rules to go through the legislative process, number one, we are not fast over here either, unless we're really motivated to do, for example, to pass a constitutional amendment. But we're not very quick on this side either. And often, you know, I've, in my eight years here, have been in the situation where, you know, to motivate the agency to go ahead and pass a rule so that they can change you know a small detail that frankly shouldn be legislated will threaten legislation to get them to speed up that process But I guess how are we not creating more bureaucracy and slowing down the process for implementation of a lot of these activities if we're now requiring the legislature, even through JCAR, to act every single time? I'm just curious. There has to be a better balance there. And I feel like maybe this legislation is shifting it too far to also creating issues. Thank you very much through the chair representative.
Nothing in this bill precludes the legislature from saying, okay, we want you to, I'm trying to think of an example, update the fired code to be consistent with federal code and best practices. We could pass that as legislation and delegate a fairly wide latitude to an individual agency if there's something we don't want to dig into or we think is more appropriate for the executive branch to do. Nothing in this precludes that. Nothing in this eliminates those things. I think the fire codes went speed limits. You know, we have, for ODOT, we have certain parameters for speed limits, but we let them work within those and within the details, right? We can still delegate that. We can still outline a process for that. We can still give that authority. But it's not to be assumed. The problem is we have agencies now assuming authority that we haven't specifically delegated. delegated. And it is keeping us busy in JCAR because we're dealing with this on a every three-week basis with agencies who have overstepped and done things that are clearly outside of legislative intent, and they're hiding behind some of the language that's a little bit vague, and that's why the bill's so long, is we're eliminating some of those vague statutes. We're not eliminating anything substantive that we've asked an agency to do. We had a, I think this committee actually did a big review of agencies and boards and commissions and what their job descriptions were and if they were complying with it. That's for that kind of legislation. This doesn't do any of that. This simply says and clarifies that we are the ones who make policy. It doesn't say we can't delegate some of that policymaking. It just says we're the ones who make policy, who make the laws.
Quick follow-up. So I guess to that point, you know, many of our agencies are also having to work under federal statute, which will override whether or not the state tells them to do it or not. And so I guess does this bill provide for, you know, do they now have to wait for the legislature to say you should, you know, update these rules to comply with federal statute? Or shouldn't they just be able to go ahead and move forward if federal law requires them to update the rules to comply? Can you get more details about that?
You've given me the perfect softball. In the 1770s, the Virginia legislature came up with the Virginia Bill of Rights. And in that, part of that was segregating out the various powers of the various branches. Right. And the legislative oversight, legislative intent, and state authority over federal authority was ingrained. When the Constitution was written later on and the first three articles were drafted, the federal government was a little bit vague. So the folks from Virginia, Thomas Jefferson in particular, made sure that in the Bill of Rights we had the Ninth and Tenth Amendment that allowed the states to act as independent entities even in the federalism system that was there. That concept still holds today. So one of the beauties of JCAR and the process we have is it's not even separation of the branches, but it's also a place where we deal with federalism very directly. And while this bill doesn't specifically alter the arrangement we have now, that's pretty well established between the federal courts and the U.S. Constitution. I think that addresses your question and is a nice preview of the lecture about the conference.
So it sounds like, sorry, quick follow-up through Madam Chair. It sounds like you are, and thank you for the reminder about federalism, But it sounds as if you are saying that you do not want these agencies necessarily to go through the process of updating whatever, to comply with federal law or regulations, that you want them to come through JCAR first intentionally. Is that correct?
Yes, that's not a change. They have to now. This bill does not address that.
Okay. Okay. Thank you.
Representative Brent.
Thank you so much from the chairwoman to our witnesses. Hopefully you can see me. As a person who's been wearing glasses now for a little over two weeks, if you can't see me, I'm going to get you together with my doctor. I'm going to help you out, OK? Because I know you can afford it. Neither here nor there. Within this time of being a general assembly, and I'm just saying this for the grandmas, because grandma's probably sitting at home listening to us talk. We used to have a thing called JMOC, which which is the Joint Medicaid Oversight Committee. We know that does not exist. Same thing with JCAR. It exists right now, but who says down the road that JCAR will continue to exist? You know, things are here today. They're gone tomorrow because of rule changes. So I'm just laying that out for the grandmas because I know grandma has not texted me, but it's a grandma who's going to ask me because you named off all these different roles. So the Joint Committee on Agency Rules Review, what has happened? And I need you to name some specific things that legislatively you feel like did not go with the intent of the legislative, what the General Assembly intent was. So what are some rules that they've come up with that have not gone? I need you to list them all. I need at least five of them because I got another question, even though she took all the questions. That's okay. I blocked off the whole afternoon, so at this point I'll be here until three. Don't take all the afternoon because I got to go to lunch. No, the door is locked. we'll make sure you stay in, because we need the lecture.
Just off the top of my head in the last 24 hours, we had a department that had proposed some rules that were contrary to intent on what I think was legislative intent certainly an area we hadn acted though there is pending legislation dealing with kratom and natural kratom versus the processed part So that one where the legislature is currently having hearings on it and the Department of I Believe Pharmacy decided to act, even knowing that we are debating it, and did something that's what we just haven't made the decision on, basically usurping our power. We've had a number of rules over the last six months that have come out from the governor's office, administrative rules, which go through the agencies, which are things either we've addressed or we're in the process of addressing that have kind of undermined the legislative authority in those areas. We've had a lot over education issues over the last two decades. That seems to be irregular to the point where we invalidated so many rules from the Ohio Department of Education. Eventually, it was easier to just eliminate the department. So we probably have two examples a month of that, which is why we need the legislation. It's becoming very, very prominent that that happens.
I do have a quick follow-up. I'm assuming you meant two per person, because we like to ask questions here.
No, I meant two overall.
You've passed the threshold. Man, we took all the questions, Rip. So we passed this thing called the policy to rule.
Yes.
Okay, and so when it particularly comes to that, if our agencies have to wait, since they are our interpretive body of that, how does that exist if this is implemented in our system?
The policy rule to rule was passed just like the five-year review was passed six or seven years ago. Like I said, we have to address this every few years because the agencies have full-time professional lawyers figuring out how to do things outside the legislature. I mean, literally, it's full-time jobs at a lot of agencies. The policy to rule simply says you can't ignore rulemaking and just create a policy and start enforcing it, charging fines, charging fees, charging people with criminal offenses because you want to or you think it's right. That's the legislature's legislative prerogative. That's our branch. And that was happening so much that we passed the policy to rule a few years ago that said if it should be in rule, thus should be through statute, indirectly or directly, you can't just do that and skip the rulemaking process. So we added that as a prong to JCAR several years ago, a couple years ago, so that we would be able to catch those things and make sure that the agencies aren't just totally circumventing the checks and balances between the two branches. That's gotten a lot better. But now they're putting in rules, and we do catch them at JCAR and correct them and send them back. But they've shifted it, and now they're doing things in rule that are outside of what the legislature has asked them to do. And some of these folks have, and you want them to, right? You want the Department of Health to have a bias towards making everybody healthy. I once, cross-examination, well, witness questioning, many years ago had the director of the Department of Health up, and we were talking about an environmental thing and I finally asked the question I said so people die walking across the street to get hit by a car I said yes And following your logic to the conclusion you all would adopt a rule outlawing cars and outlawing streets And he said, yes. We want our agencies and agency directors to be very zealous in their field. But our job as a legislature, as a representative of the people that elected us, is to have the balance. Our constitution was set up that way. Our entire nation was founded on that concept, that we have different branches for different purposes, and we have the checks and balances. When one gets out of whack, it becomes more powerful. Quite frankly, term limits have really contributed to that because the bureaucrats will be here longer than us. That's the truth. And so having oversight, having someone who's been on JCAR 16 years now, 15 and a half years, we see a lot. And we see that bureaucratic creep that comes in, and we have to correct it. It's a natural part of government. I'll talk in a few minutes. I've got about 20 minutes to talk about Federalist No. 10 and why human nature was taken into account. And I think it's human nature that the agencies would want to grow and expand their power, expand what they're doing. And again, the Department of Health wants everybody to be healthy and safe, but there's some balance we have to find there as legislators. As my co-sponsor said, we're accountable to the public that Alexis, and we're going to get in trouble with them for a rule that an agency made on our watch if we aren't very diligent with this type of thing.
Thank you, Representative Plummer.
Thanks, Chair. Thanks, gentlemen, for this bill. You guys both are on your second tour duty. You do a great job. You guys really do a good job with the rules, processes, accountabilities. You guys are probably the two best we have in that arena, so thank you. My question's kind of been answered. I got two of them, Chair. Have you guys ever done this in the past? You see mission creep in your roles. Have you ever done this in the past where we try to tighten this down?
Every couple of years. The policy to rule, we had something called a bucket of invalidation at one point where we would randomly choose an agency literally out of a bucket to go back and look at. The addition of the five-year review will reinforce agencies to go back and look at the rules every five years, and we in JCAR review every rule every five years to make sure it's not outdated or, you know, things change. So those are the reforms we've had during this tour of duty in the last seven years. Since 1977, we went from three prongs. We now have seven prongs in JCAR that we can use to invalidate. So, yeah, every few years we have to make an adjustment to adapt. Madam Chair, to the member as well, a lot of my legislative agenda just during this tour of duty in the legislature focuses on this area. I've got a bill right now that's looking at metropolitan planning organizations that are coloring, in some instances, way outside the lines in terms of what they're authorized to do under federal law. our zero-based budgeting effort which will get its last hearing I hope today in the finance committee is also an effort to force agencies more carefully to go through the process of budgeting rather than just taking the budget from the last time around and tacking on 2 or 3 so it an incremental process that we go through to try to keep the executive branch reined in where it belongs so that we can do our jobs as legislators
Representative Miller.
Thank you, Madam Chair, and thank you, gentlemen, for this bill. My question, I guess it breaks down to under the summary of the second bullet that it said, requires each agency to identify and immediately stop enforcing all rules adopted by the agency pursuant to general rulemaking authority eliminated by the bill. My question is, is how, in fact, what oversight is there to ensure that they are actually doing this? Are you saying we don't trust the agencies to do what we tell them and they need oversight?
Well, I think that's why we're here today. I think that kind of circles back as to why we're doing the bill. I think they will, but if they don't, J. Carr, and I'm sure the legislature in general, will assist them in achieving that goal.
Representative Zinneberg?
Yes, thank you, Chair A., and thank you both for your testimony for this bill. You had mentioned, I think, Rep. Calendar about the cat and mouse game between the legislature and the agencies. So first, is that inevitable? Is this, even if this passes, are we always going to just be, you know, playing this cat and mouse between the agencies and the legislature?
Representative Sendenberg, I refer back to Federalist No. 10, where James Madison discussed the human nature of factions, of us and them, whether it's two parties, whether it's a party that becomes so big it splits in half, whether it is the different branches, or whether it's the state and federal level of government. That human nature of taking your job seriously, whichever one you are, and really believing in the cause that you're working for, will by human nature lead to you trying to expand the amount of authority you have so that you can better do that. And Federalist No. 10, as you recall, really took that concept and said, okay, rather than trying to eliminate that, Rather than trying to outlaw that, let's work that into the framework of our new government and come up with checks and balances to make sure that those individual interests, as they're trying to expand their areas of influence and their areas of authority, are checked by one of the others. So the creation originally, we really had two co-equal branches in the judiciary. It wasn't, if you remember, Tim Marbury versus Madison that really the judicial branch became a co-equal. and served as the arbiter in the cases where there was a conflict between the legislative and the executive branch. So, yes, I believe it's human nature. I believe this will not be the last piece of legislation needed. I'm sure three or four years from now there will be something else that appears that we'll need to do. and if the executive branch feels like we've gone too far, they will go to that third arbiter, the judicial branch, and have a review done to it. We're pretty, very comfortable that this is constitutional, but it may be that there's some issues in the future that require the referee branch to come in and help sort out the difference. Madam Chair, to Representative Sinnenberg, I think the founders might be surprised with, given how they crafted the Constitution and given the thoughts in the Constitution,
Number 10, where the legislative branch has sort of moved over the years, I think they would be surprised that a lot of times we seem as legislators and particularly the national level to cede our authority to the executive branch and to say, well, we don't want to actually put that much detail in the statute. Over to you all to figure it out. The secretary shall promulgate regulations that is such a common phrase that you see in federal law. Because most of the time they don't want to do their job. They want somebody else to do their job in the executive branch so they can go raise money to run for re-election. Our job is to actually write the law. And so you'll see an example actually on the second page of the bill analysis of a poorly crafted rulemaking process on the left side. and then what a more detailed one, there are a couple examples here, might look like. So the second one here, the administrator shall adopt parole or is establishing criteria for determining both of the following. And then it lays out specifically what the criteria are. So that then provides legislative intent in a more precise manner than just saying, over to you all, figure it out, write the rule how you want. And so this 3,000-some page bill is really crafted in a way to remove all that general rulemaking authority to say, you figure it out, and to say, it's the legislature's job to figure it out. Even if it takes more time to do exactly what you all are doing on this committee, which I too rarely see around this building, frankly. You're asking good questions. You're delving into the policy. You're trying to get at what this bill is trying to accomplish. Thank you for doing what the job is supposed to entail. One follow-up, please. Thank you, Chair. Is there a model?
We often look at other states because they obviously, I assume, have the same issues. Is there a model of another state that maybe has come to a solution where they're not always playing cat and mouse and there is a balance? No, I think we will always be – I don't know that I like the phrase that was in there, cat and mouse. I prefer the phrase checks and balances. But I think that's always going to happen. Again, Federalist number 10, it is human nature. If you believe in what you're doing to try to have more authority to do more of it. And there needs to be some check on that. And this is the check on the agencies doing that. Now, the agencies in the court can be the check on us overreaching. We've all seen things or threatened that things will go to court if they go too far on an issue, especially the big hot-button issues, right? So, no, I don't think it'll end, and I'm not sure it should end, quite frankly. I think it should continue because I think there's going to be an ebb and a flow, and I think we need to maintain a robust set of checks and balances over time. And this is the solution for the issue where it is now, but I don want to say five years from now we not going to need another thing Just like when we did policy to rule we thought that would end all of the issues Just like when we did the five review we thought that would end them But I think our forefathers were brilliant in that, in setting up a system of government where you can have flexible checks and balances between the branches to assure that the basic balance of the jobs, legislating and executing, remain separate and distinguished even though they overlap a bit. And I think that's a good thing. I think that's what our government's intended to be. And I think this is one of the areas that's kind of cool because it unifies Republicans and Democrats if we're in the legislature because we know that the legislature knows how to legislate. And while we may not always agree with what we do as a legislature, we agree that it's a great process and a great institution. And we don't want to see it undermined by appointed or career bureaucrats. And I think we kind of globally agree. So I think it's a good thing.
Representative Plummer.
Thanks, Chair. Guys, again, thanks for what you're doing here. I like seeing you guys corral mission creep because I think mission creeps allowed bureaucrats to get away from their core functions and responsibilities. And I've never been more frustrated in my life than dealing with just the investigative process alone on this massive fraud we're seeing. Between Medicaid, child care, massive amounts of fraud, but the bureaucrats continue to point at each other on who's responsible to oversee the investigative process. I've never seen anything like this in my life. So I'm sure your process here of corralling mission creep can get those people back to their core functions. Is that true?
Madam Chair, to the member, yes, that's the goal here. And it has been a source of frustration for me as well, Representative, as we've been working the Medicaid fraud investigation for over a year now. And one of the big pieces that came back to me when we started this letter-writing process back and forth with the then-director was, well, they do that at the county level, and so we don't know, and they do that at the Social Security Administration at the federal level, so we don't know. And my answer back to them was, do you know anything? Because I can add a column of 88 numbers. So if the JFS is at the local level doing it, just add the 88 items together, and you'll get your aggregated state number for whatever it is that we're looking for. But it's a source of great frustration that this is how the bureaucrats handle it, And they really become captive to whatever the mission area is rather than representing the interests of the taxpayer and the people. And that's really what we're trying to get back at here. Thank you.
Representative Russo?
Yeah, thank you, Madam Chairwoman, indulging another question. I guess I still trying to wrap my brain around you know this seems like a pretty broad expansion of power and requirements of the legislative branch in this Again I worry a little bit about the imbalance here You know we talk about checks and balances but no one ever wants to talk about the check on the legislative branch because we do overreach. But I guess my question for you is, isn't this what JCAR is already supposed to be doing? And what, I mean, essentially, that is what you are tasked to do, is to review these rules that have been proposed, you know, push back on them. You know, in Congress, they have this sort of, they have this 60-day window, essentially, that if a federal agency, they can, they don't like, promulgates a rule that they don't like, they can essentially rescind it, nullify it within 60 days. I guess, again, why are we going to create, you know, more bureaucracy and procedure instead of, I guess, giving a little bit more authority to JCAR to pull these things back when necessary, as opposed to at the front end, which theoretically can really slow down a lot of these necessary processes. And I'm just sort of trying to understand, again, how this isn't going to massively slow down a lot of necessary work for these agencies.
Trying to think how to phrase this, but remember, you're still in the legislature. You're not in the executive branch yet. So remember which team we're on. I would argue that this actually simplifies the process and makes it simpler and makes it cleaner. And it is the entire General Assembly looking at this, not just JCAR. And so I think it will lessen the burden on JCAR a little bit. Maybe, maybe not. It may end up with a glut of more for JCAR. But it's a conceptual check and balance between the branches. So it's not really a direct JCAR issue. It's more of a legislative versus executive branch balance and the checks on that. And we're trying to make sure we maintain our check on that. And, again, I don't think anybody in this room, maybe a year from now, some in the room might argue otherwise. But right now, I don't think anybody in this room would argue that anyone should be legislating for the state other than the state-elected legislature. And this bill just clarifies that, clears up some areas where that's not happening now, where other people are legislating, other entities are legislating, and that's not appropriate. It's not appropriate under our Constitution. It's not appropriate under our foundational documents. And I think as the legislative branch, we need to make sure that we are clear on that. The buck stops here on legislation. We're the ones who get the calls. We the ones who get elected or unelected because of the policy decisions made We the ones that get the criticism We the ones that have the ultimate responsibility We want to make sure that we are doing the job and not letting some unelected person who on a mission take that away from us take it away from the voters who elected us Madam Chair and to the representative, I think, again, the founders would probably be surprised.
at the idea of a legislator expressing concern about having too much authority within this branch of government. President Washington came up to the Senate early in his first term to present a treaty and thought that the treaty was just going to go right through the process. And they began debating the thing right in front of him. And he stormed out in a huff and actually never returned again. And it set a precedent, as all the things did, the actions that he took, where presidents didn't come up and report to Congress in a personal way for over a century after that. State of the Union addresses or reports to Congress on the State of the Union were done by – were delivered by letter as a result of that experience. And what it was was the Senate demonstrating to the President of the United States, we're in charge here. We're the ones who have consent to grant over the approval of this treaty. We're the ones who craft the laws. You execute them by signing. It doesn't mean that that side of government doesn't have a role to play in crafting legislation, although that's certainly grown over the years from what was originally conceived. But again, I think the founders would be surprised at a legislator expressing concern about too much authority accruing to the legislative branch of government. Quick follow-up. To the representatives, to be clear, I believe what you are calling legislative, there is administrative rule that is necessary for implementation. There is a distinction there, and you're conflating the two. So I'm not sure that our founders would be surprised. I think it would be shocked at some of the things that this legislature has done over the years, but that's a debate for perhaps over drinks.
Madam Chair, I think the founders would be surprised at an administrative code at all, but that's a separate matter.
Are there any further questions for the representatives? Thank you very much. This concludes the first hearing.
Madam Chair, could I get a whiteboard and a video monitor, please?
I will take that under advisement, Representative. Thank you so much. This concludes the first hearing on House Bill 775. Thank you. I will now call up House Joint Resolution 9 for its third hearing. There were no in-person testimonies submitted. Committee members, please see the written testimony submitted for House Joint Resolution that is available on your iPads for review. This concludes the third hearing on House Joint Resolution 9. Seeing no further business before the committee, the House General Government Committee stands adjourned.