Ohio House of Representatives Speaker Larry Householder formed a special task for to address the need for economic recovery from COVID 19. The Montrose Group based upon a review of all fifty state economic recovery plans and a strong knowledge of Ohio’s economic development program recommended eight steps the state should consider to restore the Ohio economy. Below is a summary of the Montrose Group white paper.
Montrose Group COVID 19 Ohio Stimulus Package White Paper Summary
COVID 19 is having a devasting personal and economic toll in the state of Ohio, the United States, and around the globe. Ohio Governor Mike DeWine and state leaders are illustrating bold leadership and addressing this crisis through aggressive public health efforts, support for jobless workers, delays in state workers compensation premiums and federal funding for small businesses and relief from federal government regulation. JPMorgan estimates the Q1 2020 world economy GDP will decline 12%, and 10M Americans filed for unemployment the last two weeks of March, 2020. US restaurants report in March laying off 3 M workers & losing sales of $25 B, and the St. Louis Federal Reserve estimates COVID 19 could cost 47 M jobs, increase the unemployment rate past 32% and put at risk 67 M jobs. Moody’s Analytics estimates COVID 19 will create a 29% decline in America’s GDP and hit all fifty states. To avoid long-term economic disruption, the Montrose Group, LLC, a Columbus, Ohio based economic development and public policy consulting firm, recommends the adoption of a state of Ohio Economic Stimulus Package proposal by state government leaders that include:
- JobsOhio’s efforts to fund the development Personal Protective Equipment (PPEs) should be supported as PPEs are needed by a range of professions.
- The Ohio General Assembly should immediately move to adopt the state of Ohio capital budget to put $2.5 billion into the Ohio economy to put construction companies and their employees to work on these capital budget projects in 2020.
- The Ohio General Assembly and Governor Dewine should be supported for their decision to have the state of Ohio follow suit with the federal government and enact a 90-day delay in collecting quarterly minimum income tax payments due on April 15, 2020 to assist Ohio’s small business owners with cash flow to keep their companies afloat.
- State of Ohio regulations should be revised to reflect the current challenges of COVID 19 including: defining all current efforts being taken by public K-12 schools to educate students via distance learning as constituting the definition of students attending school; waive the requirement that employers are responsible for paying the interest on any unemployment compensation loan from the federal government; extend for 60-90 days the statute of limitations for filing refunds for any state administered tax; suspend certain regulatory obligations like inspection, reporting, and testing obligations, which if delayed, will not cause harm to human health or the environment; suspend corporate annual meeting requirements and/or allow all corporations to conduct virtual annual meetings; grant exemption from penalties to state vendors that cannot fulfill deliverables on a state contract due to circumstances related to COVID-19; extend the time, currently 30 days, within which a business is allowed to make a cure offer to a consumer after being served with a lawsuit; and grant civil immunity to public and private sector organizations manufacturing personal protection equipment for use in the COVID 19 crisis.
- The Ohio Development Services Agency should make $500 million in funding available through its166 Direct Loan Fund to support local hospitality, creative services and arts companies and organizations and small businesses negatively impacted by the COVID 19 by 25% to ensure their economic survival through grants of up to $1 million and no-interest loans of up to $2.5 million for impacted companies and organizations that can illustrate financial hardship due to COVID 19 as company financing programs at the federal government level will be oversubscribed and JobsOhio financing programs are focused on larger companies who have participated in JobsOhio programs before.
- Ohio’s Job Retention Tax Credit should be temporarily revised to lower the threshold of retained employees to 25 jobs so that Ohio’s manufacturing and non-retail service companies who agree to retain their current base of jobs are able to utilize the program and lower their tax burden and free up cash flows. Funding for the Job Retention Tax Credit program needs to be increased to $500 million from the state’s $2.8 billion Rainy Day Fund.
- The Ohio General Assembly should adopt Senate Bill 39 which will provide $50 million in insurance premium-based tax credits to leverage millions more in private investments for large scale, transformational projects in urban and rural communities across Ohio.
Economic development strategies crafted by JobsOhio and the Ohio Development Services Agency to develop sites, innovation districts, and talent should be continued as planned and not be halted by calls to move resources to address COVID 19 challenges to ensure the state is positioned to retain and attract high-wage jobs and capital investment when the global economy restarts.
