May 19, 2026 · Finance Committee · 3,091 words · 14 speakers · 96 segments
The committee will come to order. Will the clerk please call the roll?
Chair Serino? Here.
Vice Chair Chavez? Here.
Ranking Member Hicks-Hudson? Here.
Senator Blessing? Here.
Senator Brenner? Present.
Senator Craig? Here.
Senator Ingram?
Senator Lange? Here.
Senator Manchester? Here.
Senator Manning checked in.
Senator Patton? Here.
Senator Romanchuk? Here.
Senator Wilkin?
Okay, we have a quorum and we'll proceed as a full committee. With a quorum present, we would ask the committee to review the minutes from the May 12th meeting, which are on the iPads. Are there any additions, corrections, or objections to the minutes? Seeing none, the minutes are approved. First order of business today will be the third hearing on Substitute Senate Bill 315. The committee will recall that at our last hearing, we adopted a sub-bill that will implement a gradual rollout of chip cards by JFS for SNAP benefits in our continuing efforts to reduce fraud in the SNAP program. The chair recognizes Vice Chair Chavez for a motion on the bill.
Thank you, Mr. Chairman. I move to favorably report substitute Senate Bill 315 to the Committee on Rules and Reference.
The question is, shall the bill be favorably reported to the Committee on Rules and Reference? The clerk will please call the roll. Chair Serino?
Yes.
Vice Chair Chavez?
Yes.
Senator Blessing?
Yes.
Senator Brenner?
Yes.
Senator Craig?
Yes.
Senator Lange?
Absolutely.
Senator Manchester?
Yes.
Senator Manning?
Yes.
Senator Patton?
Yes.
Senator Romanchuk?
Yes.
We will consider Senator Lang's absolutely as a yes. Having sufficient votes, the bill is favorably reported to the Committee on Rules and Reference. Members, please sign the vote sheet as it makes its way across the dais. This will conclude the third hearing on substitute Senate Bill 315. Okay. Okay. We will leave the vote open for members who are not here for that until the conclusion of the committee. Okay. Thank you. The next order of business will be the fourth hearing on Senate Bill 120. I now recognize Vice Chair Chavez for a motion.
Thank you, Mr. Chairman. I move to adopt amendment AM 1362378.
Thank you. The amendment is in order. Since fiscal 26 will end in roughly 40 days, and since any new program will take a little time to get up and running, and running. The amendment removes the appropriation for fiscal 26 but keeps the appropriation for fiscal 27. The amendment also permits 15% of the funds appropriated for fiscal 27 to be used for administrative efforts to develop and establish the pilot program. I would also like to mention that our staff has worked with the sponsor in ranking member Hicks Hudson in developing this amendment. Are there any objections to the amendment? Okay. Seeing no objections, the amendment becomes a part of the bill. The Chair recognizes Vice Chair Chavez for a
motion on the bill. Thank You Mr. Chairman. I move to favorably report Senate
Bill 120 to the Committee on Rules and Reference. The question is, shall the bill be favorably reported to the Committee on Rules and Reference? The Clerk will call the roll. Chair Serino? Yes. Vice Chair Chavez? Yes. Ranking Member Hicks-Hudson?
Yes.
Senator Blessing?
Yes.
Senator Brenner?
Yes.
Senator Craig?
Yes.
Senator Ingram?
Yes.
Senator Lange?
Yes.
Senator Manchester?
Yes.
Senator Manning?
Yes.
Senator Patton?
Yes.
Senator Romanchuk?
Yes.
Senator Wilkin?
Yes.
Having sufficient votes, the bill is favorably reported to the Committee on Rules and Reference. I would like to move without objection to give LSC permission to harmonize the amendment as needed for Senate Bill 120. Are there any objections? Seeing no objections, LSC has the authority to harmonize the amendment. Members, please sign the vote sheet as it makes its way across the dais. This will conclude the fourth hearing on Senate Bill 120. The final order of business is the first hearing on Senate Bill 372. We will be hearing sponsored testimony from our own Senator Schaefer. Senator Schaefer, welcome to committee. Welcome to your committee.
Thank you so much, Chairman Serino, Vice Chairman Chavez and Ranking Member Hicks and members of the Senate Finance Committee for the opportunity to present sponsored testimony on Senate Bill 372 This legislation creates a financial reporting system for any non group that receives state taxpayer money Senate Bill 372 will promote clarity in reporting the use of direct and indirect costs coming from any non-government group or business that is receiving public money from the state. We've seen abuses by, I call them NGOs, non-government organizations. We've seen abuses by NGOs in other states, and we want to make sure that these abuses of the taxpayer don't go on here in Ohio. It is essential that public funds are used properly as these groups have an obligation to use these funds in a principled manner and holding various groups who are receiving public money to a high standard of accountability is critical in preventing fraud, waste, and abuse of public dollars. Implementing a reporting system would allow NGOs to submit financial status reports and indicate what public money was received and how it was used through their projects. One example of fraud, waste, and abuse of public funds was highlighted in the December 2025 State Auditor's Report. Auditor Faber reported that 39 out of 55 companies that have received job creation tax credits in recent years through the Ohio Department of Development failed to meet minimum requirements of that tax credit. This is just one example of many where taxpayer funds and incentives have been used and abused by NGOs. So thank you again, Chairman Sereno, members of the committee, for the opportunity to bring this legislation before you today. I'd be glad to answer any questions.
Thank you for your testimony. Are there any questions? Yes, Senator Ingram.
Thank you, Mr. Chair. Thank you for this. My first question is, so what do we do now?
I'm sorry?
I mean, how is this handled now?
Oh, Mr. Chairman, Mr. Chairman, Senator Ingram, my understanding is there's not, throughout state government, there's not a whole lot of reporting back. I've asked the question. I haven't done a formal inquiry or investigation. I suppose I should have LSC get back to us on that. But as I have spoken with other departments, nonprofits that I know, a lot of organization vendors, there's no reporting back. And I suppose maybe in a contract, contractual situation, some agencies, I'm sure, put in reporting methodology that they want to hear back. but it's not consistent. It's not part of the law as far as I can tell.
Follow-up?
Thank you, Mr. Chair. Thank you for that. I guess maybe I'm trying to figure out. So are we talking about every organization that receives any dollars, whether it be in the budget directly through the general revenue fund or through, say, an agency that works with DCY and receives their money from that department. So we're all reporting back to, they're all reporting back to Office of Budget and Management, and what you're seeking is a way to do that which centralizes everybody's information depending on what, say DCY. We've got our daycare centers. Those people will actually receive money to supplement preschool or whatever. So when they report back, they report to DCY, and are you looking for DCY to have a form that everybody fills out the same form, looking for the same information? and they'll all have the same contracts, I assume.
Mr. Chairman, Senator Ingram, you're getting very close to the whole spirit of the bill, whether it's a grant to a nonprofit for operations or a grant to a nonprofit or a for-profit to fulfill a specific task, which we do a lot of. We have a lot of folks that we give contracts and grants out to, for-profits, nonprofits, all of the above, to do functions of state government, as you know, at some point they would have to, yes, if they're spending taxpayer money, they would have to at some point, and it's spelled out in the bill, report back to the state, and I would see that report finding its way to that department and the people who let out the contract. For example, you mentioned daycares. I'll say, let's say we have an ODNR contract for planting 1,000 trees. And whether it was Trees Unlimited, my fictitious nonprofit, or Schaefer Enterprises a for doesn matter whoever got that contract or that grant to plant 1 trees at some point we got to come back and report we planted 1 trees and here our evidence Because otherwise, the state of Ohio may not be checking back to see if there were 1,000 trees planted. Just like we want to make sure if there's a daycare performing its duties, we want to make sure kids are there. And just pick any grant or loan, as it applies to loans too, but mostly grants and contracts. We want to make sure that the taxpayer is made whole, that there is a service or product being performed or provided in exchange for that money according to the intent of the budget bill or the ODOT budget bill or whatever budget bill might be in appropriation. We want to make sure it's happening.
Follow up.
Thank you, Mr. Chair. So let's take your trees. You've got 1,000 trees. They planted trees, whoever got the grant, whether it be for National Forest Day or whatever, they do that. They planted trees. We measure how effective they are by the fact that they planted the trees or that the trees grew and served some purpose.
Mr. Chairman, Senator Ingram, whatever the terms of that contract or that grant were, If the grant was to give a nonprofit money to plant 1,000 trees, and let's say it was my nonprofit that I run, then I'm going to have to report back through various methods, and I don't want to dictate the actual methods. I don't want the administration to come up with their methodology. But I would envision I've got to show a receipt where I bought 1,000 trees or seedlings. I bought 1,000 units. and maybe some time sheets that show that we paid people to go out and plant them and where they got planted. Maybe have that park director or whatever park it was in sign an affidavit saying, yep, Schaefer's nonprofit was out here and they planted 1,000 trees. There are a lot of different ways we can show evidence that those trees were planted. Now if it says we want to see the trees come to full growth in 20 years, that would be a long, long time, but at least we got them planted.
Thank you, Mr. Chair. Yeah, I get it, but I'm going to go back to my original question, which is what are we already doing, and how is what you're prescribing here going to impact what that looks like? For instance, all the school districts have to report specific information through EMIS. Does that change or does that look like something else because of what we're doing here, or will they report to different entities that gave them a grant, saying it's from safety and it's through something else other than through due, are they reporting back to all of these other things, that information that's already there? So I'm concerned with what already exists and then what we're trying to get to with this bill.
Chairman Serino, Senator Ingram, that's a great point, and I want to make sure this bill doesn't overwrite or overrule the processes that are already in place. Just like you mentioned, school numbers that come in from the school districts. It's not my intent to change that system. It's already happening.
What other examples? You had another one.
Well, if we took great parks, we took our park system, and they have grants and dollars and things of that nature. I'm trying to figure out what doesn't get reported already that we need. And so if it's just to get to something specific, then that's cool. But if we're just throwing it out there so that everybody has to report something back just because you got a $25,000 grant, then my concern would be that DCY or criminal justice, I mean the corrections people, are keeping up with that. So let's make sure what's already in place before we place something else to do whatever.
Chairman Serena, Senator Ingram, I get what you're saying, and I want to make sure that we're not supplanting or changing systems that are already in place. However, the folks I've talked to already, this is not a scientific study anecdotally, is that we have, and it probably depends on the different department executives and whatever departments we have in the state of Ohio, a lot of these groups are not performing to our expectations for the taxpayer money. Now, if they're not taking taxpayer money, I don't care about them. I mean, go do what you want as a nonprofit or for-profit vendor to somebody else. but once you're taking our taxpayers' money, you do owe an obligation to report back of how you've used that money. Did you meet your goals or not? It's kind of like Department of Development and the Job Creation Tax Credit. Yeah, the development's already got that, and that was the other example I was trying to think of. I'm sorry. DOD already has that in place where they have to report back how many new jobs or if it job retention tax credit how many they retained Very objective data And we can feel either satisfied or dissatisfied with that performance. And if we're dissatisfied, then we're going to have to find a remedy on what those companies need to do to make the taxpayer whole because they didn't use the money that we ever intended.
Right. Just one more. One more. Thank you for that, because I really kind of think I see where you're going, but I also want to make sure that if indeed your intent is, is that if we do, say, transformational development grant, and we find out that that company didn't come in on time and project and whatever, is that we're already getting some of that information from development folks, but what else should that look like, and should we be clawing dollars back, maybe?
Mr. Chairman, Senator Ingram, I don't have clawback provisions in this bill. I wouldn't be opposed to that sort of amendment or development. All I'm trying to do in this right now is educate the taxpayer and educate us and educate our state agency directors as to how well performance is being done, how well this money is being spent. The owners, our taxpayers, have a right to know that. And I look at my own business experience, personal as well as professional business experience. I run a small nonprofit. It's not a large business. But you know what? When I let money out the door, I expect to see the result. And if it's not satisfactory, you know, you have other remedies to you. But if you want to talk remedies and add that to the bill, we could discuss that. But I want to go light on that for now. Because right now I just want to talk about reporting and educating the legislature, the administration, and the taxpayer as to how our money is being used.
Yes, go ahead, please. Therefore, I'm hoping that one of the things that you'll send to the chair is the information that LSE sends you as to how this is already being done.
Absolutely, Mr. Chairman. I'd appreciate that. Thank you.
We'll ask the questions. Before I recognize the ranking member here, I would suggest maybe if I may make a suggestion that for the next, as the hearings proceed on this, that we have a good idea of how we're managing results in other areas. There are a lot of, there's a lot of reviews done from various aspects of the budgets, Yet we do have reappropriations and redirects that come by on things that we have provided appropriations for that either didn't happen or they're happening too slowly or whatever. So I think we should just, it would be helpful for the bill to be considered to understand better how we're doing it in other places and what problem this is solving.
Absolutely.
If I may. Senator Hanks Hudson.
Thank you, Mr. Chair, and thank you, Senator, for bringing this legislation. because I do think it's important that we do be good stewards of taxpayer dollars and make sure that funds are being spent and that the results that are being sought are evaluated. In your summary and your discussion, you're asking the Office of Budget and Management to be like the central location for this data. Is that correct?
Yes, Mr. Chairman, ranking member, yes, that's the way we have it drafted now. and I would presume then that they would distribute it to the agencies that were letting out those contracts or grants.
Well, that's good because I was just wondering about it. Within the Office of Budget and Management, you do have the setup by which they disperse and then they work with departments to determine about funding and things like that. They also have the audit side or the accounting side of OBM, and I'm just following up with what Senator Ingram, and also, yeah, I said what's her name, and then also the chair, about maybe looking to see exactly what exists now and trying to fashion something else, because I often think that we in the legislature don't really know what's happening on the executive side, that these things may already be there, and it's just a reporting mechanism that might be a little bit more clear for us to be able to better shepherd and understand what's happening. So I look forward to additional testimony and also for the information that you're going to send to the chair from LSC as how this thing actually works in state government right now. Thank you.
Thank you.
Absolutely.
Thank you so much.
Okay. Thank you for your testimony.
Thank you.
As there are no other questions, this will conclude the first hearing for Senate Bill 372. Is there any other business before the committee? Seeing none, we are adjourned.