For those considering state government jobs after college or graduate school, certain opportunities often come with the informal – but widely known – warning: this can be a hard job during the state’s biennial budget drafting season. This year’s Amended Substitute House Bill 96 (Am. Sub. H.B. 96; State Fiscal Year (SFY) 2026 and SFY 2027) proved that truism, testing the fortitude of legislative staffers and budget analysts more severely than past budget seasons.
The General Assembly delivered to Governor DeWine a 5,700-page, $200 billion biennial operating budget that was approved largely along party-lines, with zero Democrats supporting the measure. And the Governor signed the bill – but only after making a record 67 line-item vetoes.[1] Filled with impactful changes to Ohio’s revenue collections and programming expenses, this was one of the most volatile budget seasons in recent memory.
Budget bill items of most significance to economic developers appear below, in alphabetical order:
- All Ohio Future Fund (AOFF) zeroed out.[2]
- Brownfield Remediation Program[3] appropriated $100 million per state fiscal year (i.e., SFY 2026 – SFY 2027), reserving $1 million per county each year, with all remaining funds awarded on a discretionary, “case-by-case” basis by the Ohio Dept. of Development (ODOD) as to projects’ economic merit – rather than on a first-come, first-served basis. The program also was expanded to include demolition and infrastructure costs as eligible uses of funds.[4]
- Certain federally funded Community Development programming – and related employees – at ODOD transferred to Ohio Dept. of Job and Family Services, including Community Services Block Grant[5], Home Energy Assistance Program (HEAP), HEAP Weatherization[6], and Home Weatherization Program.
- The Community Reinvestment Area (CRA) program has been modified to allow improvements that are already abated under an existing agreement to receive an extension as a “megaproject” abatement if located on the same site or owned by a megaproject operator. And other political subdivisions – like port authorities – do not need to be signatories to CRA agreements unless they are the fee simple owner of subject property.[7]
- NEW! Cultural and Sports Facility Performance Grant Fund appropriated $1 billion, of which $600 million was directed to help finance the relocation of the Cleveland Browns to a new indoor stadium in suburban Brook Park. This program provides funding via 16-year Major Sports Facilities Performance Grants to major sports facilities[8], reimbursing up to 25% of construction costs[9] associated with such projects.[10]
- Demolition and Site Revitalization Program appropriated $21.5 million per state fiscal year.
- Phasing down the State’s income tax to 2.75% flat-rate for Ohioans with income more than $26,050, effective Tax Year 2026.[11]
- Port authority law changed to prohibit port authorities, when operating outside their territorial jurisdiction, from entering into construction or renovation agreements with non-public entities – for the latter to access port authorities’ sales-and-use tax exemption – unless approved by the applicable board(s) of county commissioners. And to allow port authorities to establish a common bond fund program to finance port authority facilities.[12]
- Rural Industrial Park Loan Program appropriated $5 million per state fiscal year, with loans capped at $4 million per project.[13]
- NEW! Rural Residential Development Revolving Loan Fund appropriated $100 million in SFY 2026. This new RLF, administered by ODOD, makes low-interest loans to counties, municipalities, and townships to develop, repair, or upgrade infrastructure serving new, single-family housing development in rural areas.[14] Loans are capped at lesser of 50% of costs of infrastructure or $30,000/single-family unit, and borrowing subdivisions must waive certain building, zoning, and planning requirements. Loans are repaid via new TIF structure that exempts RLF-financed single-family residential improvements, directing annual service payments in lieu of taxes to retire the RLF debt service.
- NEW! Residential Economic Development Districts program[15], appropriated $10 million in SFY 2026 and $15 million in SFY 2027. Residential Economic Development Districts (REDDs) are 20-mile development zones surrounding major economic development projects[16], making available grants to political subdivisions that adopt pro-housing policies to fund owner-occupied single-family housing projects.
- Roadwork 629 program expanded to include funding construction, maintenance, or repair of public road access to tourism attractions and professional sports facilities – including improvements associated with retail and residential project components of such facilities.[17]
- Transformational Mixed-Use Development tax credit program (TMUD)[18] authorized $125 million in annual tax credits (increased from $100 million). But the General Assembly inserted a sunset clause[19], as well as made other changes: expanded TMUD tax credits to be claimed against Ohio’s financial institutions and income tax obligations[20], reduced maximum tax credits to $20 million per project (from $40 million), and requires that only property owners apply for TMUD tax credits.
- Welcome Home Ohio Program[21] appropriated $45.6 million in grant funds per state fiscal year, with authority to use such grants split 50-50 towards acquisition and construction/rehabilitation activities. The budget bill also increased grant amounts to $100,000 per qualifying residential property (from $30,000) and increased tax credit amounts to $90,000 or 90% of eligible costs, whichever is less (from 1/3 of project costs). At the same time, the General Assembly substantially modified the program, to include: expanding the cohort of eligible applicants from county land banks to include certain nonprofit developers; reducing the size of eligible single-family housing units to 800 sq ft. (from 1,000 sq ft.); allowing for mixed-use development projects; increasing income limits of qualified home buyers under the program to 120% (from 80%) of the median income for the county where the residential property is located; and increasing the resale purchase price cap of qualifying residential property to $220,000 (from $180,000).
- Changes to local zoning regulations as follows: exempts from voter referenda any township zoning amendments related to megaprojects, and increases to 35% (from 15%) the number of signatures of eligible electors required on a township referendum petition[22]; requires signatures of 35% of eligible electors for planned-unit development zoning regulations in counties, townships, and municipalities.[23]
[1] Included in Governor DeWine’s line-item vetoes was an attempt by the General Assembly to eliminate the Ohio Tax Credit Authority’s ability, after October 1, 2025, to enter into agreements to provide data centers with sales-and-use tax exemptions (see Ohio Revised Code Section (R.C.) 122.175).
[2] Ohio Office of Budget and Management directed to transfer $250 million of AOFF cash to the State’s General Revenue Fund and $200 million of AOFF cash to the Brownfield Remediation Program.
[3] R.C. 122.6511.
[4] The sister Demolition and Site Revitalization Program also eliminated awards on first-come, first-served basis as to remaining funds after county reserves. (See R.C. 122.6512)
[5] R.C. 122.66 et seq.
[6] R.C. 4928.53.
[7] R.C. 3735.67 and R.C. 3735.671.
[8] Such facilities are owned, at least in part, by governmental agencies, new community authorities, or nonprofit entities.
[9] Governor DeWine removed via line-item veto the General Assembly’s attempt to insert grant reimbursement tiers (15% or 25% of total project costs), based on a sports facility’s project size (less than $500 million, or more than $500 million, respectively), as well as its attempt to set minimum cost thresholds for project eligibility determinations. The Governor’s line-item veto results in a single 25% reimbursement cap.
[10] R.C. 123.28, R.C. 123.281.
[11] R.C. 5747.02.
[12] R.C. 4582.72, R.C. 4582.73.
[13] R.C. 122.24, Am. Sub. H.B. 96, uncodified Sec. 259.50.
[14] R.C. 122.98, R.C. 122.981, R.C. 5709.89.
[15] R.C. 122.636, R.C. 713.21.
[16] Single sites reasonably expected to create at least 700 new permanent jobs and $700 million or more of project fixed-asset investment
[17] R.C. 122.14.
[18] R.C. 122.09.
[19] Any new tax credits after year-end SFY 2027 must be re-authorized by future General Assemblies.
[20] Under current law, only insurance premiums taxpayers can claim TMUD credits.
[21] R.C. 122.631 – R.C. 122.633.
[22] R.C. 519.12.
[23] R.C. 303.12, R.C. 519.12, R.C. 731.291.
