Create the Data Center Study Commission

hb646_06_RCS

As Recommitted to the Senate Energy Committee

136th
General Assembly

Regular
Session
Sub. H. B. No. 646

2025-2026

Representatives Click, Deeter

Cosponsors: Representatives
Pizzulli, Thomas, D., Salvo, Daniels, Workman, Mathews, T.,
Richardson, Stephens, Newman, Barhorst, Williams, Brennan, King,
Plummer, Ghanbari, Hall, T., Lorenz, Gross, Bird, Manning, Stewart,
Holmes, Miller, M., Abdullahi, Claggett, Creech, Dovilla, Hoops,
John, Klopfenstein, Lear, Mathews, A., Miller, J., Miller, K.,
Mohamed, Peterson, Ray, Robb Blasdel, Rogers, Schmidt, Synenberg,
Troy, Upchurch, White, A., Willis, Young

To
amend sections 122.17
,

122.175
,
and 3745.015

and to enact sections 122.55, 149.437, 1521.301, 1521.302, 1521.303
,
4582.432
,
4941.01, 4941.02, 4941.03, 4941.04, 4941.05
,
4941.06
,
5709.94, and 6111.70 of the Revised Code
regarding
data centers.

BE
IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section
1.
That
sections 122.17
,

122.175
,
and 3745.015

be amended and sections 122.55, 149.437, 1521.301, 1521.302,
1521.303
,
4582.432
,
4941.01, 4941.02, 4941.03, 4941.04, 4941.05
,
4941.06
,
5709.94, and 6111.70 of the Revised Code be enacted to read as
follows:

Sec.
122.17.
(A)
As used in this section:

(1)
"Payroll" means the total taxable income paid by the
employer during the employer's taxable year, or during the calendar
year that includes the employer's tax period, to each employee or
each home-based employee employed in the project to the extent such
payroll is not used to determine the credit under section 122.171 of
the Revised Code. "Payroll" excludes amounts paid before
the day the taxpayer becomes eligible for the credit and retirement
or other benefits paid or contributed by the employer to or on behalf
of employees.

(2)
"Baseline payroll" means Ohio employee payroll, except that
the applicable measurement period is the twelve months immediately
preceding the date the tax credit authority approves the taxpayer's
application or the date the tax credit authority receives the
recommendation described in division (C)(2)(a) of this section,
whichever occurs first, multiplied by the sum of one plus an annual
pay increase factor to be determined by the tax credit authority.

(3)
"Ohio employee payroll" means the amount of compensation
used to determine the withholding obligations in division (A) of
section 5747.06 of the Revised Code and paid by the employer during
the employer's taxable year, or during the calendar year that
includes the employer's tax period, to the following:

(a)
An employee employed in the project who is a resident of this state
including a qualifying work-from-home employee not designated as a
home-based employee by an applicant under division (C)(1) of this
section;

(b)
An employee employed at the project location who is not a resident
and whose compensation is not exempt from the tax imposed under
section 5747.02 of the Revised Code pursuant to a reciprocity
agreement with another state under division (A)(3) of section 5747.05
of the Revised Code;

(c)
A home-based employee employed in the project.

"Ohio
employee payroll" excludes any such compensation to the extent
it is used to determine the credit under section 122.171 of the
Revised Code, and excludes amounts paid before the day the taxpayer
becomes eligible for the credit under this section.

(4)
"Excess payroll" means Ohio employee payroll minus baseline
payroll.

(5)
"Home-based employee" means an employee whose services are
performed primarily from the employee's residence in this state
exclusively for the benefit of the project and whose rate of pay is
at least one hundred thirty-one per cent of the federal minimum wage
under 29 U.S.C. 206.

(6)
"Full-time equivalent employees" means the quotient
obtained by dividing the total number of hours for which employees
were compensated for employment in the project by two thousand
eighty. "Full-time equivalent employees" excludes hours
that are counted for a credit under section 122.171 of the Revised
Code.

(7)
"Metric evaluation date" means the date by which the
taxpayer must meet all of the commitments included in the agreement.

(8)
"Qualifying work-from-home employee" means an employee who
is a resident of this state and whose services are supervised from
the employer's project location and performed primarily from a
residence of the employee located in this state.

(9)
"Resident" or "resident of this state" means an
individual who is a resident as defined in section 5747.01 of the
Revised Code.

(10)
"Reporting period" means a period corresponding to the
annual report required under division (D)(6) of this section.

(11)
"Megaproject" means a project in this state that meets all
of the following requirements:

(a)
At least one of the following applies:

(i)
The project requires unique sites, extremely robust utility service,
and a technically skilled workforce

and does not involve the acquisition, construction, renovation,
expansion, replacement, or repair of a data center
.

(ii)
The megaproject operator of the project has its corporate
headquarters in the United States, incurs more than fifty per cent of
its research and development expenses in the United States in the
year preceding the date the tax credit authority approves the project
for a credit under this section, and builds and operates
semiconductor wafer manufacturing factories in this state or intends
to do so by the metric evaluation date applicable to the megaproject
operator.

(b)
The megaproject operator of the project agrees, in an agreement with
the tax credit authority under division (D) of this section, that, on
and after the metric evaluation date applicable to the megaproject
operator and until the end of the last year for which the megaproject
qualifies for the credit authorized under this section, the
megaproject operator will compensate the project's employees at an
average hourly wage of at least three hundred per cent of the federal
minimum wage under 29 U.S.C. 206, exclusive of employee benefits, as
determined at the time the tax credit authority approves the project
for a credit under this section.

(c)
The megaproject operator agrees, in an agreement with the tax credit
authority under division (D) of this section, to satisfy either of
the following by the metric evaluation date applicable to the
project:

(i)
The megaproject operator makes at least one billion dollars, as
adjusted under division (V)(1) of this section, in fixed-asset
investments in the project.

(ii)
The megaproject operator creates at least seventy-five million
dollars, as adjusted under division (V)(1) of this section, in Ohio
employee payroll at the project.

(d)
The megaproject operator agrees, in an agreement with the tax credit
authority under division (D) of this section, that if the project
satisfies division (A)(11)(c)(ii) of this section, then, on and after
the metric evaluation date and until the end of the last year for
which the megaproject qualifies for the credit authorized under this
section, the megaproject operator will maintain at least the amount
in Ohio employee payroll at the project required under that division
for each year in that period.

(12)
"Megaproject operator" means a taxpayer that, separately or
collectively with other taxpayers, undertakes and operates a
megaproject. Such a taxpayer becomes a megaproject operator effective
the first day of the calendar year in which the taxpayer and the tax
credit authority enter into an agreement under division (D) of this
section with respect to the megaproject. More than one taxpayer may
be designated by the tax credit authority as a megaproject operator
for the same megaproject.

(13)
"Megaproject supplier" means a supplier in this state that
meets either or both of the following requirements:

(a)
The supplier sells tangible personal property directly to a
megaproject operator of a megaproject that satisfies the criteria
described in division (A)(11)(a)(ii) of this section for use at a
megaproject site, provided that such property was subject to
substantial manufacturing, assembly, or processing in this state at a
facility owned or operated by the supplier;

(b)
The supplier
is
not a data center and
sells
tangible personal property directly to a megaproject operator for use
at a megaproject site, provided that the supplier agrees, in an
agreement with the tax credit authority under division (D) of this
section, to meet all of the following requirements:

(i)
By the metric evaluation date applicable to the supplier, makes at
least one hundred million dollars, as adjusted under division (V)(2)
of this section, in fixed-asset investments in this state;

(ii)
By the metric evaluation date applicable to the supplier, creates at
least ten million dollars, as adjusted under division (V)(2) of this
section, in Ohio employee payroll;

(iii)
On and after the metric evaluation date applicable to the supplier,
until the end of the last year for which the supplier qualifies for
the credit authorized under this section, maintains at least the
amount in Ohio employee payroll required under division
(A)(13)(b)(ii) of this section for each year in that period.

(14)
"Data center" means one or more buildings or physical
facilities or infrastructure, located on a single real property
parcel or on contiguous, adjacent, or otherwise aggregated real
property parcels that are used primarily or exclusively for digital
information services such as the management, storage, processing, and
dissemination of electronic data and information through the use of
computer systems, servers, networking equipment, and related
components, including equipment cooling systems, or virtual currency
mining.

(B)
The tax credit authority may make grants under this section to foster
job creation in this state. Such a grant shall take the form of a
refundable credit allowed against the tax imposed by section 5725.18,
5726.02, 5729.03, 5733.06, 5736.02, or 5747.02 or levied under
Chapter 5751. of the Revised Code. The credit shall be claimed for
the taxable years or tax periods specified in the taxpayer's
agreement with the tax credit authority under division (D) of this
section. With respect to taxes imposed under section 5726.02,
5733.06, or 5747.02 or Chapter 5751. of the Revised Code, the credit
shall be claimed in the order required under section 5726.98,
5733.98, 5747.98, or 5751.98 of the Revised Code. The amount of the
credit available for a taxable year or for a calendar year that
includes a tax period equals the excess payroll for that year
multiplied by the percentage specified in the agreement with the tax
credit authority.

(C)(1)
A taxpayer or potential taxpayer who proposes a project to create new
jobs in this state may apply to the tax credit authority to enter
into an agreement for a tax credit under this section.

An
application shall not propose to include both home-based employees
and employees who are not home-based employees in the computation of
Ohio employee payroll for the purposes of the same tax credit
agreement, except that a qualifying work-from-home employee shall not
be considered to be a home-based employee unless so designated by the
applicant. If a taxpayer or potential taxpayer employs both
home-based employees and employees who are not home-based employees
in a project, the taxpayer shall submit separate applications for
separate tax credit agreements for the project, one of which shall
include home-based employees in the computation of Ohio employee
payroll and one of which shall include all other employees in the
computation of Ohio employee payroll.

The
director of development shall prescribe the form of the application.
After receipt of an application, the authority may enter into an
agreement with the taxpayer for a credit under this section if it
determines all of the following:

(a)
The taxpayer's project will increase payroll;

(b)
The taxpayer's project is economically sound and will benefit the
people of this state by increasing opportunities for employment and
strengthening the economy of this state;

(c)
Receiving the tax credit is a major factor in the taxpayer's decision
to go forward with the project.

(2)(a)
A taxpayer that chooses to begin the project prior to receiving the
determination of the authority may, upon submitting the taxpayer's
application to the authority, request that the chief investment
officer of the nonprofit corporation formed under section 187.01 of
the Revised Code and the director review the taxpayer's application
and recommend to the authority that the taxpayer's application be
considered. As soon as possible after receiving such a request, the
chief investment officer and the director shall review the taxpayer's
application and, if they determine that the application warrants
consideration by the authority, make that recommendation to the
authority not later than six months after the application is received
by the authority.

(b)
The authority shall consider any taxpayer's application for which it
receives a recommendation under division (C)(2)(a) of this section.
If the authority determines that the taxpayer does not meet all of
the criteria set forth in division (C)(1) of this section, the
authority and the department of development shall proceed in
accordance with rules adopted by the director pursuant to division
(I) of this section.

(D)
An agreement under this section shall include all of the following:

(1)
A detailed description of the project that is the subject of the
agreement;

(2)(a)
The term of the tax credit, which, except as provided in division
(D)(2)(b) or (C) of this section, shall not exceed fifteen years, and
the first taxable year, or first calendar year that includes a tax
period, for which the credit may be claimed;

(b)
If the tax credit is computed on the basis of home-based employees,
the term of the credit shall expire on or before the last day of the
taxable or calendar year ending before the beginning of the seventh
year after September 6, 2012, the effective date of H.B. 327 of the
129th general assembly.

(c)
If the taxpayer is a megaproject operator or a megaproject supplier
that meets the requirements described in division (A)(13)(b) of this
section, the term of the tax credit shall not exceed thirty years.

(3)
A requirement that the taxpayer shall maintain operations at the
project location for at least the greater of seven years or the term
of the credit plus three years;

(4)
The percentage, as determined by the tax credit authority, of excess
payroll that will be allowed as the amount of the credit for each
taxable year or for each calendar year that includes a tax period;

(5)
The pay increase factor to be applied to the taxpayer's baseline
payroll;

(6)
A requirement that the taxpayer annually shall report to the director
of development full-time equivalent employees, payroll, Ohio employee
payroll, investment, the provision of health care benefits and
tuition reimbursement if required in the agreement, and other
information the director needs to perform the director's duties under
this section;

(7)
A requirement that the director of development annually review the
information reported under division (D)(6) of this section and verify
compliance with the agreement; if the taxpayer is in compliance, a
requirement that the director issue a certificate to the taxpayer
stating that the information has been verified and identifying the
amount of the credit that may be claimed for the taxable or calendar
year. If the taxpayer is a megaproject supplier, the director shall
issue such a certificate to the megaproject supplier and to any
megaproject operator (a) to which the megaproject supplier directly
sells tangible personal property and (b) that is authorized to claim
the credit pursuant to division (D)(10) of this section.

(8)
A provision providing that the taxpayer may not relocate a
substantial number of employment positions from elsewhere in this
state to the project location unless the director of development
determines that the legislative authority of the county, township, or
municipal corporation from which the employment positions would be
relocated has been notified by the taxpayer of the relocation.

For
purposes of this section, the movement of an employment position from
one political subdivision to another political subdivision shall be
considered a relocation of an employment position unless the
employment position in the first political subdivision is replaced.
The movement of a qualifying work-from-home employee to a different
residence located in this state or to the project location shall not
be considered a relocation of an employment position.

(9)
If the tax credit is computed on the basis of home-based employees,
that the tax credit may not be claimed by the taxpayer until the
taxable year or tax period in which the taxpayer employs at least two
hundred employees more than the number of employees the taxpayer
employed on June 30, 2011;

(10)
If the taxpayer is a megaproject supplier, the percentage of the
annual tax credit certified under division (D)(7) of this section, up
to one hundred per cent, that may be claimed by each megaproject
operator to which the megaproject supplier directly sells tangible
personal property, rather than by that megaproject supplier, on the
condition that the megaproject operator continues to qualify as a
megaproject operator;

(11)
If the taxpayer is a megaproject operator or megaproject supplier, a
requirement that the taxpayer meet and maintain compliance with all
thresholds and requirements to which the taxpayer agreed, pursuant to
division (A)(11) or (13) of this section, respectively, as a
condition of the operator's project qualifying as a megaproject or
the supplier qualifying as a megaproject supplier until the end of
the last year for which the taxpayer qualifies for the credit
authorized under this section. In each year that a megaproject
operator or megaproject supplier is subject to an agreement with the
tax credit authority under this section and meets the requirements of
this division, the director of development shall issue a certificate
to the megaproject operator or megaproject supplier stating that the
megaproject operator or megaproject supplier continues to meet those
requirements.

(12)
If the taxpayer is a megaproject operator, a requirement that the
megaproject operator submit, in a form acceptable to the director of
development, an economic impact report with respect to each
megaproject for which the megaproject operator is designated,
summarizing all of the following for the reporting year:

(a)
The aggregate amount of purchases made by the megaproject operator
for such megaproject from megaproject suppliers;

(b)
The aggregate amount of purchases made by the megaproject operator
for such megaproject from suppliers other than megaproject suppliers;

(c)
A summary of the construction activity for any facilities at the site
of the megaproject in that year;

(d)
The aggregate amount expended by the megaproject operator on research
and development at the site of the megaproject in that year;

(e)
The number of employees working at the site of the megaproject and
the counties in which those employees reside;

(f)
A summary of the supply chain activity in support of the megaproject,
including a list of the twenty-five suppliers with a physical
presence in Ohio from which the megaproject operator made the most
purchases in that year.

The
economic impact report shall be due on or before the first day of
July of each year, beginning in the year specified in the agreement
with the tax credit authority. The information required in the report
shall be certified as true and correct by an officer of the
megaproject operator. If there is more than one megaproject operator
designated for a single megaproject, all of the megaproject operators
designated for the megaproject may jointly submit a single report.
Any information contained in the report is a public record for
purposes of section 149.43 of the Revised Code and shall be published
on the department of development's web site.

(E)(1)
If a taxpayer fails to meet or comply with any condition or
requirement set forth in a tax credit agreement, the tax credit
authority may amend the agreement to reduce the percentage or term of
the tax credit. The reduction of the percentage or term may take
effect in the current taxable or calendar year.

(2)
If the tax credit authority determines that a taxpayer that is a
megaproject operator of a megaproject described in division
(A)(11)(a)(ii) of this section is not fully compliant with the
requirements of the agreement, the authority may impose a recoupment
payment on the taxpayer in accordance with the following:

(a)
If, on the metric evaluation date, the taxpayer fails to
substantially meet the capital investment, full-time equivalent
employee, or payroll requirements included in the agreement, an
amount determined at the discretion of the authority, not to exceed
the sum of the following for all years prior to the metric evaluation
date: (i) the amount of taxes that would have been imposed under
Chapters 5739. and 5741. of the Revised Code in the absence of the
agreement, and (ii) the amount of taxes that would have been imposed
under Chapter 5751. of the Revised Code on receipts realized from
sales to the taxpayer in the absence of the agreement;

(b)
If the taxpayer fails to substantially maintain the capital
investment, full-time equivalent employee, or payroll requirements
included in the agreement in any year after the metric evaluation
date, an amount determined at the discretion of the authority, not to
exceed the sum of the following for the calendar year in which
taxpayer failed to meet the requirements: (i) the amount of taxes
that would have been imposed under Chapters 5739. and 5741. of the
Revised Code in the absence of the agreement, and (ii) the amount of
taxes that would have been imposed under Chapter 5751. of the Revised
Code on receipts realized from sales to the taxpayer in the absence
of the agreement.

(3)
The tax credit authority may, subject to any requirements of the tax
credit agreement, take into consideration the taxpayer's prior
performance and any market conditions impacting the taxpayer when
determining the amount of the recoupment payment described in
division (E)(2) of this section.

(F)
Projects that consist solely of point-of-final-purchase retail
facilities are not eligible for a tax credit under this section. If a
project consists of both point-of-final-purchase retail facilities
and nonretail facilities, only the portion of the project consisting
of the nonretail facilities is eligible for a tax credit and only the
excess payroll from the nonretail facilities shall be considered when
computing the amount of the tax credit. If a warehouse facility is
part of a point-of-final-purchase retail facility and supplies only
that facility, the warehouse facility is not eligible for a tax
credit. Catalog distribution centers are not considered
point-of-final-purchase retail facilities for the purposes of this
division, and are eligible for tax credits under this section.

(G)
Financial statements and other information submitted to the
department of development or the tax credit authority by an applicant
or recipient of a tax credit under this section, and any information
taken for any purpose from such statements or information, are not
public records subject to section 149.43 of the Revised Code.
However, the chairperson of the authority may make use of the
statements and other information for purposes of issuing public
reports or in connection with court proceedings concerning tax credit
agreements under this section. Upon the request of the tax
commissioner or, if the applicant or recipient is an insurance
company, upon the request of the superintendent of insurance, the
chairperson of the authority shall provide to the commissioner or
superintendent any statement or information submitted by an applicant
or recipient of a tax credit in connection with the credit. The
commissioner or superintendent shall preserve the confidentiality of
the statement or information.

(H)
A taxpayer claiming a credit under this section shall submit to the
tax commissioner or, if the taxpayer is an insurance company, to the
superintendent of insurance, a copy of the director of development's
certificate of verification under division (D)(7) of this section
with the taxpayer's tax report or return for the taxable year or for
the calendar year that includes the tax period. Failure to submit a
copy of the certificate with the report or return does not invalidate
a claim for a credit if the taxpayer submits a copy of the
certificate to the commissioner or superintendent within the time
prescribed by section 5703.0510 of the Revised Code or within thirty
days after the commissioner or superintendent requests it.

(I)
The director of development, after consultation with the tax
commissioner and the superintendent of insurance and in accordance
with Chapter 119. of the Revised Code, shall adopt rules necessary to
implement this section, including rules that establish a procedure to
be followed by the tax credit authority and the department of
development in the event the authority considers a taxpayer's
application for which it receives a recommendation under division
(C)(2)(a) of this section but does not approve it. The rules may
provide for recipients of tax credits under this section to be
charged fees to cover administrative costs of the tax credit program.
For the purposes of these rules, a qualifying work-from-home employee
shall be considered to be an employee employed at the applicant's
project location. The fees collected shall be credited to the tax
incentives operating fund created in section 122.174 of the Revised
Code. At the time the director gives public notice under division (A)
of section 119.03 of the Revised Code of the adoption of the rules,
the director shall submit copies of the proposed rules to the
chairpersons of the standing committees on economic development in
the senate and the house of representatives.

(J)
For the purposes of this section, a taxpayer may include a
partnership, a corporation that has made an election under subchapter
S of chapter one of subtitle A of the Internal Revenue Code, or any
other business entity through which income flows as a distributive
share to its owners. A partnership, S-corporation, or other such
business entity may elect to pass the credit received under this
section through to the persons to whom the income or profit of the
partnership, S-corporation, or other entity is distributed. The
election shall be made on the annual report required under division
(D)(6) of this section. The election applies to and is irrevocable
for the credit for which the report is submitted. If the election is
made, the credit shall be apportioned among those persons in the same
proportions as those in which the income or profit is distributed.

(K)(1)
If the director of development determines that a taxpayer who has
received a credit under this section is not complying with the
requirements of the agreement, the director shall notify the tax
credit authority of the noncompliance. After receiving such a notice,
and after giving the taxpayer an opportunity to explain the
noncompliance, the tax credit authority may require the taxpayer to
refund to this state a portion of the credit in accordance with the
following:

(a)
If the taxpayer fails to comply with the requirement under division
(D)(3) of this section, an amount determined in accordance with the
following:

(i)
If the taxpayer maintained operations at the project location for a
period less than or equal to the term of the credit, an amount not
exceeding one hundred per cent of the sum of any credits allowed and
received under this section;

(ii)
If the taxpayer maintained operations at the project location for a
period longer than the term of the credit, but less than the greater
of seven years or the term of the credit plus three years, an amount
not exceeding seventy-five per cent of the sum of any credits allowed
and received under this section.

(b)
If, on the metric evaluation date, the taxpayer fails to
substantially meet the job creation, payroll, or investment
requirements included in the agreement, an amount determined at the
discretion of the authority;

(c)
If the taxpayer fails to substantially maintain the number of new
full-time equivalent employees or amount of payroll required under
the agreement at any time during the term of the agreement after the
metric evaluation date, an amount determined at the discretion of the
authority.

(2)
If a taxpayer files for bankruptcy and fails as described in division
(K)(1)(a), (b), or (c) of this section, the director may immediately
commence an action to recoup an amount not exceeding one hundred per
cent of the sum of any credits received by the taxpayer under this
section.

(3)
In determining the portion of the tax credit to be refunded to this
state, the tax credit authority shall consider the effect of market
conditions on the taxpayer's project and whether the taxpayer
continues to maintain other operations in this state. After making
the determination, the authority shall certify the amount to be
refunded to the tax commissioner or superintendent of insurance, as
appropriate. If the amount is certified to the commissioner, the
commissioner shall make an assessment for that amount against the
taxpayer under Chapter 5726., 5733., 5736., 5747., or 5751. of the
Revised Code. If the amount is certified to the superintendent, the
superintendent shall make an assessment for that amount against the
taxpayer under Chapter 5725. or 5729. of the Revised Code. The time
limitations on assessments under those chapters do not apply to an
assessment under this division, but the commissioner or
superintendent, as appropriate, shall make the assessment within one
year after the date the authority certifies to the commissioner or
superintendent the amount to be refunded. Within ninety days after
certifying the amount to be refunded, if circumstances have changed,
the authority may adjust the amount to be refunded and certify the
adjusted amount to the commissioner or superintendent. The authority
may only adjust the amount to be refunded one time and only if the
amount initially certified by the authority has not been repaid, in
whole or in part, by the taxpayer or certified to the attorney
general for collection under section 131.02 of the Revised Code.

(L)
On or before the first day of August each year, the director of
development shall submit a report to the governor, the president of
the senate, and the speaker of the house of representatives on the
tax credit program under this section. The report shall include
information on the number of agreements that were entered into under
this section during the preceding calendar year, a description of the
project that is the subject of each such agreement, and an update on
the status of projects under agreements entered into before the
preceding calendar year.

(M)
There is hereby created the tax credit authority, which consists of
the director of development and four other members appointed as
follows: the governor, the president of the senate, and the speaker
of the house of representatives each shall appoint one member who
shall be a specialist in economic development; the governor also
shall appoint a member who is a specialist in taxation. Terms of
office shall be for four years. Each member shall serve on the
authority until the end of the term for which the member was
appointed. Vacancies shall be filled in the same manner provided for
original appointments. Any member appointed to fill a vacancy
occurring prior to the expiration of the term for which the member's
predecessor was appointed shall hold office for the remainder of that
term. Members may be reappointed to the authority. Members of the
authority shall receive their necessary and actual expenses while
engaged in the business of the authority. The director of development
shall serve as chairperson of the authority, and the members annually
shall elect a vice-chairperson from among themselves. Three members
of the authority constitute a quorum to transact and vote on the
business of the authority. The majority vote of the membership of the
authority is necessary to approve any such business, including the
election of the vice-chairperson.

The
director of development may appoint a professional employee of the
department of development to serve as the director's substitute at a
meeting of the authority. The director shall make the appointment in
writing. In the absence of the director from a meeting of the
authority, the appointed substitute shall serve as chairperson. In
the absence of both the director and the director's substitute from a
meeting, the vice-chairperson shall serve as chairperson.

(N)
For purposes of the credits granted by this section against the taxes
imposed under sections 5725.18 and 5729.03 of the Revised Code,
"taxable year" means the period covered by the taxpayer's
annual statement to the superintendent of insurance.

(O)
On or before the first day of March of each of the five calendar
years beginning with 2014, each taxpayer subject to an agreement with
the tax credit authority under this section on the basis of
home-based employees shall report the number of home-based employees
and other employees employed by the taxpayer in this state to the
department of development.

(P)
On or before the first day of January of 2019, the director of
development shall submit a report to the governor, the president of
the senate, and the speaker of the house of representatives on the
effect of agreements entered into under this section in which the
taxpayer included home-based employees in the computation of income
tax revenue, as that term was defined in this section prior to the
amendment of this section by H.B. 64 of the 131st general assembly.
The report shall include information on the number of such agreements
that were entered into in the preceding six years, a description of
the projects that were the subjects of such agreements, and an
analysis of nationwide home-based employment trends, including the
number of home-based jobs created from July 1, 2011, through June 30,
2017, and a description of any home-based employment tax incentives
provided by other states during that time.

(Q)
The director of development may require any agreement entered into
under this section for a tax credit computed on the basis of
home-based employees to contain a provision that the taxpayer makes
available health care benefits and tuition reimbursement to all
employees.

(R)
Original agreements approved by the tax credit authority under this
section in 2014 or 2015 before September 29, 2015, may be revised at
the request of the taxpayer to conform with the amendments to this
section and sections 5733.0610, 5736.50, 5747.058, and 5751.50 of the
Revised Code by H.B. 64 of the 131st general assembly, upon mutual
agreement of the taxpayer and the department of development, and
approval by the tax credit authority.

(S)(1)
As used in division (S) of this section:

(a)
"Eligible agreement" means an agreement approved by the tax
credit authority under this section on or before December 31, 2013.

(b)
"Income tax revenue" has the same meaning as under this
section as it existed before September 29, 2015, the effective date
of the amendment of this section by H.B. 64 of the 131st general
assembly.

(2)
In calendar year 2016 and thereafter, the tax credit authority shall
annually determine a withholding adjustment factor to be used in the
computation of income tax revenue for eligible agreements. The
withholding adjustment factor shall be a numerical percentage that
equals the percentage that employer income tax withholding rates have
been increased or decreased as a result of changes in the income tax
rates prescribed by section 5747.02 of the Revised Code by amendment
of that section taking effect on or after June 29, 2013.

(3)
Except as provided in division (S)(4) of this section, for reporting
periods ending in 2015 and thereafter for taxpayers subject to
eligible agreements, the tax credit authority shall adjust the income
tax revenue reported on the taxpayer's annual report by multiplying
the withholding adjustment factor by the taxpayer's income tax
revenue and doing one of the following:

(a)
If the income tax rates prescribed by section 5747.02 of the Revised
Code have decreased by amendment of that section taking effect on or
after June 29, 2013, add the product to the taxpayer's income tax
revenue.

(b)
If the income tax rates prescribed by section 5747.02 of the Revised
Code have increased by amendment of that section taking effect on or
after June 29, 2013, subtract the product from the taxpayer's income
tax revenue.

(4)
Division (S)(3) of this section shall not apply unless all of the
following apply for the reporting period with respect to the eligible
agreement:

(a)
The taxpayer has achieved one hundred per cent of the new employment
commitment identified in the agreement.

(b)
If applicable, the taxpayer has achieved one hundred per cent of the
new payroll commitment identified in the agreement.

(c)
If applicable, the taxpayer has achieved one hundred per cent of the
investment commitment identified in the agreement.

(5)
Failure by a taxpayer to have achieved any of the applicable
commitments described in divisions (S)(4)(a) to (c) of this section
in a reporting period does not disqualify the taxpayer for the
adjustment under division (S) of this section for an ensuing
reporting period.

(T)
For reporting periods ending in calendar year 2020 or thereafter, any
taxpayer may include qualifying work-from-home employees in its
report required under division (D)(6) of this section, and the
compensation of such employees shall qualify as Ohio employee payroll
under division (A)(3)(a) of this section, even if the taxpayer's
application to the tax credit authority to enter into an agreement
for a tax credit under this section was approved before September 29,
2017, the effective date of the amendment of this section by H.B. 49
of the 132nd general assembly.

(U)
The director of development shall notify the tax commissioner if the
director determines that a megaproject operator or megaproject
supplier is not in compliance with the agreement pursuant to a review
conducted under division (D)(11) of this section.

(V)
Beginning in 2025 and in each fifth calendar year thereafter, the tax
commissioner shall adjust the following amounts in September of that
year:

(1)
The fixed-asset investment threshold described in division
(A)(11)(c)(i) of this section and the Ohio employee payroll threshold
described in division (A)(11)(c)(ii) of this section by completing
the following calculations:

(a)
Determine the percentage increase in the gross domestic product
deflator determined by the bureau of economic analysis of the United
States department of commerce from the first day of January of the
fifth preceding calendar year to the last day of December of the
preceding calendar year;

(b)
Multiply that percentage increase by the fixed-asset investment
threshold and the Ohio employee payroll threshold for the current
year;

(c)
Add the resulting products to the corresponding fixed-asset
investment threshold and Ohio employee payroll threshold for the
current year;

(d)
Round the resulting fixed-asset investment sum to the nearest
multiple of ten million dollars and the Ohio employee payroll sum to
the nearest multiple of one million dollars.

(2)
The fixed-asset investment threshold described in division
(A)(13)(b)(i) of this section and the Ohio employee payroll threshold
described in division (A)(13)(b)(ii) of this section by completing
the calculations described in divisions (V)(1)(a) to (c) of this
section and rounding the resulting fixed-asset investment sum to the
nearest multiple of one million dollars and the Ohio employee payroll
sum to the nearest multiple of one hundred thousand dollars.

The
commissioner shall certify the amount of the adjustments under
divisions (V)(1) and (2) of this section to the director of
development and to the tax credit authority not later than the first
day of December of the year the commissioner computes the adjustment.
Each certified amount applies to the ensuing calendar year and each
calendar year thereafter until the tax commissioner makes a new
adjustment. The tax commissioner shall not calculate a new adjustment
in any year in which the resulting amount from the adjustment would
be less than the corresponding amount for the current year.

Sec.
122.175.
(A)
As used in this section:

(1)
"Capital investment project" means a plan of investment at
a project site for the acquisition, construction, renovation,
expansion, replacement, or repair of a computer data center or of
computer data center equipment, but does not include any of the
following:

(a)
Project costs paid before a date determined by the tax credit
authority for each capital investment project;

(b)
Payments made to a related member as defined in section 5733.042 of
the Revised Code or to a consolidated elected taxpayer or a combined
taxpayer as defined in section 5751.01 of the Revised Code.

(2)
"Computer data center" means a facility used or to be used
primarily to house computer data center equipment used or to be used
in conducting one or more computer data center businesses, as
determined by the tax credit authority.

(3)
"Computer data center business" means, as may be further
determined by the tax credit authority, a business that provides
electronic information services as defined in division (Y)(1)(c) of
section 5739.01 of the Revised Code, or that leases a facility to one
or more such businesses. "Computer data center business"
does not include providing electronic publishing as defined in that
section.

(4)
"Computer data center equipment" means tangible personal
property used or to be used for any of the following:

(a)
To conduct a computer data center business, including equipment
cooling systems to manage the performance of computer data center
equipment;

(b)
To generate, transform, transmit, distribute, or manage electricity
necessary to operate the tangible personal property used or to be
used in conducting a computer data center business;

(c)
As building and construction materials sold to construction
contractors for incorporation into a computer data center.

(5)
"Eligible computer data center" means a computer data
center that satisfies all of the following requirements:

(a)
One or more taxpayers operating a computer data center business at
the project site will, in the aggregate, make payments for a capital
investment project of at least one hundred million dollars at the
project site during one of the following cumulative periods:

(i)
For projects beginning in 2013, six consecutive calendar years;

(ii)
For projects beginning in 2014, four consecutive calendar years;

(iii)
For projects beginning in or after 2015, three consecutive calendar
years.

(b)
One or more taxpayers operating a computer data center business at
the project site will, in the aggregate, pay annual compensation that
is subject to the withholding obligation imposed under section
5747.06 of the Revised Code of at least one million five hundred
thousand dollars to employees employed at the project site for each
year of the agreement beginning on or after the first day of the
twenty-fifth month after the agreement was entered into under this
section.

(c)
If the computer data center has an aggregate monthly maximum demand
that is greater than two hundred fifty megawatts, the data center
offsets its consumption from the electrical grid through one of the
methods described in divisions (A)(2)(a) to (c) of section 4941.02 of
the Revised Code or under division (A)(2)(d) of section 4941.02 of
the Revised Code with at least a fifteen-year purchase power
agreement.

(6)
"Person" has the same meaning as in section 5701.01 of the
Revised Code.

(7)
"Project site," "related member," and "tax
credit authority" have the same meanings as in sections 122.17
and 122.171 of the Revised Code.

(8)
"Taxpayer" means any person subject to the taxes imposed
under Chapters 5739. and 5741. of the Revised Code.

(B)
The tax credit authority may
completely
or
partially
exempt from the taxes levied under Chapters 5739. and 5741. of the
Revised Code the sale, storage, use, or other consumption of computer
data center equipment used or to be used at an eligible computer data
center. Any such exemption shall extend to charges for the delivery,
installation, or repair of the computer data center equipment subject
to the exemption under this section.

(C)
A taxpayer that proposes a capital improvement project for an
eligible computer data center in this state may apply to the tax
credit authority to enter into an agreement under this section
authorizing a complete or partial exemption from the taxes imposed
under Chapters 5739. and 5741. of the Revised Code on computer data
center equipment purchased by the applicant or any other taxpayer
that operates a computer data center business at the project site and
used or to be used at the eligible computer data center. The director
of development shall prescribe the form of the application. After
receipt of an application, the authority shall forward copies of the
application to the tax commissioner, who shall review the application
to determine the economic impact that the proposed eligible computer
data center would have on the state and any affected political
subdivisions and submit to the authority a summary of their
determinations. The authority shall also forward a copy of the
application to the director of development who shall review the
application to determine the economic impact that the proposed
eligible computer data center would have on the state and the
affected political subdivisions and shall submit a summary of their
determinations and recommendations to the authority.

(D)
Upon review and consideration of such determinations and
recommendations, the tax credit authority may enter into an agreement
with the applicant and any other taxpayer that operates a computer
data center business at the project site for a complete or partial
exemption from the taxes imposed under Chapters 5739. and 5741. of
the Revised Code on computer data center equipment used or to be used
at an eligible computer data center if the authority determines all
of the following:

(1)
The capital investment project for the eligible computer data center
will increase payroll and the amount of income taxes to be withheld
from employee compensation pursuant to section 5747.06 of the Revised
Code.

(2)
The applicant is economically sound and has the ability to complete
or effect the completion of the proposed capital investment project.

(3)
The applicant intends to and has the ability to maintain operations
at the project site for the term of the agreement.

(4)
Receiving the exemption is a major factor in the applicant's decision
to begin, continue with, or complete the capital investment project.

(E)
An agreement entered into under this section shall include all of the
following:

(1)
A detailed description of the capital investment project that is the
subject of the agreement, including the amount of the investment, the
period over which the investment has been or is being made, the
annual compensation to be paid by each taxpayer subject to the
agreement to its employees at the project site, and the anticipated
amount of income taxes to be withheld from employee compensation
pursuant to section 5747.06 of the Revised Code.

(2)
The percentage of the exemption from the taxes imposed under Chapters
5739. and 5741. of the Revised Code for the computer data center
equipment used or to be used at the eligible computer data center,
the length of time the computer data center equipment will be
exempted, and the first date on which the exemption applies.

(3)
A requirement that the computer data center remain an eligible
computer data center during the term of the agreement and that the
applicant maintain operations at the eligible computer data center
during that term. An applicant does not violate the requirement
described in division (E)(3) of this section if the applicant ceases
operations at the eligible computer data center during the term of
the agreement but resumes those operations within eighteen months
after the date of cessation. The agreement shall provide that, in
such a case, the applicant and any other taxpayer that operates a
computer data center business at the project site shall not claim the
tax exemption authorized in the agreement for any purchase of
computer data center equipment made during the period in which the
applicant did not maintain operations at the eligible computer data
center.

(4)
A requirement that, for each year of the term of the agreement
beginning on or after the first day of the twenty-fifth month after
the date the agreement was entered into, one or more taxpayers
operating a computer data center business at the project site will,
in the aggregate, pay annual compensation that is subject to the
withholding obligation imposed under section 5747.06 of the Revised
Code of at least one million five hundred thousand dollars to
employees at the eligible computer data center.

(5)
A requirement that each taxpayer subject to the agreement annually
report to the director of development employment, tax withholding,
capital investment, and other information required by the director to
perform the director's duties under this section.

(6)
A requirement that the director of development annually review the
annual reports of each taxpayer subject to the agreement to verify
the information reported under division (E)(5) of this section and
compliance with the agreement. Upon verification, the director shall
issue a certificate to each such taxpayer stating that the
information has been verified and that the taxpayer remains eligible
for the exemption specified in the agreement.

(7)
A provision providing that the taxpayers subject to the agreement may
not relocate a substantial number of employment positions from
elsewhere in this state to the project site unless the director of
development determines that the appropriate taxpayer notified the
legislative authority of the county, township, or municipal
corporation from which the employment positions would be relocated.
For purposes of this paragraph, the movement of an employment
position from one political subdivision to another political
subdivision shall be considered a relocation of an employment
position unless the movement is confined to the project site. The
transfer of an employment position from one political subdivision to
another political subdivision shall not be considered a relocation of
an employment position if the employment position in the first
political subdivision is replaced by another employment position.

(8)
A waiver by each taxpayer subject to the agreement of any limitations
periods relating to assessments or adjustments resulting from the
taxpayer's failure to comply with the agreement.

(F)
The term of an agreement under this section shall be determined by
the tax credit authority, and the amount of the exemption shall not
exceed
one
hundred
fifty

per
cent of such taxes that would otherwise be owed in respect to the
exempted computer data center equipment.

(G)
If any taxpayer subject to an agreement under this section fails to
meet or comply with any condition or requirement set forth in the
agreement, the tax credit authority may amend the agreement to reduce
the percentage of the exemption or term during which the exemption
applies to the computer data center equipment used or to be used by
the noncompliant taxpayer at an eligible computer data center. The
reduction of the percentage or term may take effect in the current
calendar year.

(H)
Financial statements and other information submitted to the
department of development or the tax credit authority by an applicant
for or recipient of an exemption under this section, and any
information taken for any purpose from such statements or
information, are not public records subject to section 149.43 of the
Revised Code. However, the chairperson of the authority may make use
of the statements and other information for purposes of issuing
public reports or in connection with court proceedings concerning tax
exemption agreements under this section. Upon the request of the tax
commissioner, the chairperson of the authority shall provide to the
tax commissioner any statement or other information submitted by an
applicant for or recipient of an exemption under this section. The
tax commissioner shall preserve the confidentiality of the statement
or other information.

(I)
The tax commissioner shall issue a direct payment permit under
section 5739.031 of the Revised Code to each taxpayer subject to an
agreement under this section. Such direct payment permit shall
authorize the taxpayer to pay any sales and use taxes due on
purchases of computer data center equipment used or to be used in an
eligible computer data center and to pay any sales and use taxes due
on purchases of tangible personal property or taxable services other
than computer data center equipment used or to be used in an eligible
computer data center directly to the tax commissioner. Each such
taxpayer shall pay pursuant to such direct payment permit all sales
tax levied on such purchases under sections 5739.02, 5739.021,
5739.023, and 5739.026 of the Revised Code and all use tax levied on
such purchases under sections 5741.02, 5741.021, 5741.022, and
5741.023 of the Revised Code, consistent with the terms of the
agreement entered into under this section.

During
the term of an agreement under this section each taxpayer subject to
the agreement shall submit to the tax commissioner a return that
shows the amount of computer data center equipment purchased for use
at the eligible computer data center, the amount of tangible personal
property and taxable services other than computer data center
equipment purchased for use at the eligible computer data center, the
amount of tax under Chapter 5739. or 5741. of the Revised Code that
would be due in the absence of the agreement under this section, the
exemption percentage for computer data center equipment specified in
the agreement, and the amount of tax due under Chapter 5739. or 5741.
of the Revised Code as a result of the agreement under this section.
Each such taxpayer shall pay the tax shown on the return to be due in
the manner and at the times as may be further prescribed by the tax
commissioner. Each such taxpayer shall include a copy of the director
of development's certificate of verification issued under division
(E)(6) of this section. Failure to submit a copy of the certificate
with the return does not invalidate the claim for exemption if the
taxpayer submits a copy of the certificate to the tax commissioner
within the time prescribed by section 5703.0510 of the Revised Code.

(J)
If the director of development determines that one or more taxpayers
received an exemption from taxes due on the purchase of computer data
center equipment purchased for use at a computer data center that no
longer complies with the requirement under division (E)(3) of this
section, the director shall notify the tax credit authority and, if
applicable, the taxpayer that applied to enter the agreement for the
exemption under division (C) of this section of the noncompliance.
After receiving such a notice, and after giving each taxpayer subject
to the agreement an opportunity to explain the noncompliance, the
authority may terminate the agreement and require each such taxpayer
to pay to the state all or a portion of the taxes that would have
been owed in regards to the exempt equipment in previous years, all
as determined under rules adopted pursuant to division (K) of this
section. In determining the portion of the taxes that would have been
owed on the previously exempted equipment to be paid to this state by
a taxpayer, the authority shall consider the effect of market
conditions on the eligible computer data center, whether the taxpayer
continues to maintain other operations in this state, and, with
respect to agreements involving multiple taxpayers, the taxpayer's
level of responsibility for the noncompliance. After making the
determination, the authority shall certify to the tax commissioner
the amount to be paid by each taxpayer subject to the agreement. The
tax commissioner shall make an assessment for that amount against
each such taxpayer under Chapter 5739. or 5741. of the Revised Code.
The time limitations on assessments under those chapters do not apply
to an assessment under this division, but the tax commissioner shall
make the assessment within one year after the date the authority
certifies to the tax commissioner the amount to be paid by the
taxpayer.

(K)
The director of development, after consultation with the tax
commissioner and in accordance with Chapter 119. of the Revised Code,
shall adopt rules necessary to implement this section. The rules may
provide for recipients of tax exemptions under this section to be
charged fees to cover administrative costs incurred in the
administration of this section. The fees collected shall be credited
to the tax incentives operating fund created in section 122.174 of
the Revised Code. At the time the director gives public notice under
division (A) of section 119.03 of the Revised Code of the adoption of
the rules, the director shall submit copies of the proposed rules to
the chairpersons of the standing committees on economic development
in the senate and the house of representatives.

(L)
On or before the first day of August of each year, the director of
development shall submit a report to the governor, the president of
the senate, and the speaker of the house of representatives on the
tax exemption authorized under this section. The report shall include
information on the number of agreements that were entered into under
this section during the preceding calendar year, a description of the
eligible computer data center that is the subject of each such
agreement, and an update on the status of eligible computer data
centers under agreements entered into before the preceding calendar
year.

(M)
A taxpayer may be made a party to an existing agreement entered into
under this section by the tax credit authority and another taxpayer
or group of taxpayers. In such a case, the taxpayer shall be entitled
to all benefits and bound by all obligations contained in the
agreement and all requirements described in this section. When an
agreement includes multiple taxpayers, each taxpayer shall be
entitled to a direct payment permit as authorized in division (I) of
this section.

Sec.
122.55.
The
director of development shall prepare and publish on its web site
resources for use by political subdivisions when authorizing tax
incentives, as defined in section 5709.94 of the Revised Code, for
data centers, as defined in section 122.17 of the Revised Code.

Sec.
149.437.
(A)
As used in this section:

(1)"Nondisclosure
agreement" means an agreement or contract that includes a
provision or clause that prohibits an individual from disclosing,
discussing, describing, or commenting on specified information.

(2)
"Public record" has the same meaning as in section 149.43
of the Revised Code.

(B)
Notwithstanding any terms of the agreement to the contrary, a
nondisclosure agreement shall not be construed to prohibit or
otherwise limit a public record from being made available under
section 149.43 of the Revised Code.

Sec.
1521.301.
(A)
As used in sections 1521.301 to 1521.303 of the Revised Code:

(1)
"Closed-loop water or liquid cooling system" and "data
center" have the same meanings as in section 4941.01 of the
Revised Code.

(2)
"Rules" means any rules adopted by the chief of the
division of water resources under section 1521.303 of the Revised
Code.

(B)
Any person that owns a data center or a major utility facility that
is subject to regulation under Chapter 4906. of the Revised Code that
solely supplies power to a data center shall accurately measure and
report the consumptive use of water by such data center or major
utility facility in accordance with section 1521.302 of the Revised
Code and any rules.

(C)
Any person that owns a data center shall implement best industry
practices for water conservation and water-use efficiency in the
design, construction, and operation of the data center. Practices may
include modern direct evaporative closed-loop water or liquid cooling
systems or recirculating water systems, water reuse and recycling
systems, high-efficiency cooling technologies, air-cooled or hybrid
cooling systems where feasible, automated leak detection and
monitoring technologies, use of nonpotable or reclaimed water sources
where practicable, and other operational or engineering measures
designated to minimize consumptive use and optimize water efficiency.
Any design of a closed-loop water or liquid cooling system shall
ensure waste streams may be properly treated and disposed of in
accordance with any applicable laws.

Sec.
1521.302.
(A)
Any person that owns a data center or a major utility facility that
is subject to regulation under Chapter 4906. of the Revised Code that
solely supplies power to a data center shall submit to the chief of
the division of water resources an annual report not later than the
first day of February each year, in a manner determined by the chief,
that includes all of the following:

(1)
Documentation that the person that owns the data center or major
utility facility has complied with best industry practices for water
conservation in accordance with division (C) of section 1521.301 of
the Revised Code;

(2)
The total consumptive use of water per day by the data center or the
major utility facility for the previous calendar year, which shall
include a description of the total water consumption by source type,
including potable, nonpotable, and reclaimed;

(3)
A description of any additional measures undertaken by the data
center or major utility facility in the previous calendar year to
improve efficiency and reduce water consumption;

(4)
Any other information as the chief may require by rule.

(B)
The chief shall prepare an annual report that compiles data received
in accordance with division (A) of this section from the previous
calendar year. The chief shall submit the annual report to the
speaker of the house of representatives, the senate president, and
the house of representatives and senate committees that consider
energy legislation and natural resources legislation within ninety
days after preparing such report.

Sec.
1521.303.
(A)
The chief of the division of water resources may adopt rules in
accordance with Chapter 119. of the Revised Code that establish any
of the following:

(1)
Standards for accurate measurement and reporting of consumptive use
of water;

(2)
The consumptive use coefficient for data centers;

(3)
A nonrefundable fee to accompany each annual report, credited to the
water management fund created under section 1521.22 of the Revised
Code.

(4)
Any other provisions necessary to administer and enforce sections
1521.301 to 1521.303 of the Revised Code.

(B)
Notwithstanding any provision of section 121.95 of the Revised Code
to the contrary, a regulatory restriction contained in a rule adopted
under this section is not subject to sections 121.95 to 121.953 of
the Revised Code.

Sec.
3745.015.
There
is hereby created in the state treasury the environmental protection
fund consisting of money credited to the fund under division (A)(3)
of section 3734.57

and
,

division
(E) of section 3714.07
,
and section 6111.70

of the Revised Code. The environmental protection agency shall use
money in the fund to pay the agency's costs associated with
administering and enforcing, or otherwise conducting activities
under, this chapter and Chapters 3704., 3734., 3746., 3747., 3748.,
3750., 3751., 3752., 3753., 5709., 6101., 6103., 6105., 6109., 6111.,
6112., 6113., 6115., 6117., and 6119. of the Revised Code, including
providing compliance assistance to small businesses.

However, any fees credited to the fund under section 6111.70 of the
Revised Code shall be used to pay the agency's costs associated with
implementing that section.

Sec.
4582.432.
(A)
As used in this section:

(1)
"Capital leaseback agreement" means the sale or transfer of
property by a port authority to another person contemporaneously
followed by the leasing of the property to the port authority.

(2)
"Data center" has the same meaning as defined in section
4941.01 of the Revised Code.

(B)
Notwithstanding any section of the Revised Code to the contrary, a
port authority shall not enter into a capital leaseback agreement for
a data center project located outside the authority's territorial
jurisdiction.

Sec.
4941.01.
As
used in this chapter:

(A)
"Closed-loop water or liquid cooling system" means a sealed
cooling process in which the same water or coolant circulates
continuously with de minimis withdrawal from waters of the state or
discharge into waters of the state.

(B)
"Data center" means one or more buildings or physical
facilities or infrastructure, located on a single real property
parcel or on contiguous, adjacent, or otherwise aggregated real
property parcels requiring peak demand capacity that is greater than
twenty-five megawatts at a single building or physical location and
that are used primarily or exclusively for digital information
services such as the management, storage, processing, and
dissemination of electronic data and information through the use of
computer systems, servers, networking equipment, and related
components, including equipment cooling systems, or virtual currency
mining.

(C)
"Electric distribution utility" has the same meaning as in
section 4928.01 of the Revised Code.

(D)
"Mercantile customer self-power system" has the same
meaning as in section 4928.73 of the Revised Code.

(E)(1)
"Virtual currency" means any type of digital unit that is
used as a medium of exchange or a form of digitally stored value or
that is incorporated into payment system technology and that may or
may not have a centralized repository or administrator, including
digital units of exchange that are created or obtained by computing
or manufacturing effort.

(2)
"Virtual currency" does not include digital units of
exchange that are used as follows:

(a)
Solely within online gaming platforms with no market or application
outside of such gaming platforms;

(b)
Exclusively as part of a consumer affinity or rewards program, and
can be applied solely as payment for purchases with the issuer or
other designated merchants, but cannot be converted into or redeemed
for fiat currency.

(F)
"Virtual currency mining" means the process by which
individuals or other entities use data, computer code, calculations,
and any other computing process to validate transactions involving
virtual currency and earn virtual currency as compensation.

(G)
"Standard service offer" means a standard service offer
under section 4928.141 of the Revised Code.

Sec.
4941.02.
(A)
As of the effective date of this section, each new data center in
this state with an aggregate monthly maximum demand of greater than
two hundred fifty megawatts shall be supplied with all of its
electricity using any or all of the following sources that must
offset any consumption from the electrical grid by the data center:

(1)
One or more electric generating facilities constructed to supply
electricity to the data center;

(2)
One or more generation or power supply arrangements to supply
electricity to the data center, including any of the following:

(a)
Mercantile customer self-power systems;

(b)
Customer-generator projects;

(c)
Co-located load arrangements regulated by the federal energy
regulatory commission;

(d)
Purchase power agreements;

(e)
Only if at least one of the sources described in division (A)(1) or
divisions (A)(2)(a) to (d) of this section is used, qualified PJM
interconnection L.L.C. market solutions.

(3)
Only if at least one of the sources described in division (A)(1) or
divisions (A)(2)(a) to (d) of this section is used, service through a
tariff approved by the public utilities commission under section
4941.04 of the Revised Code.

(B)
An electric distribution utility shall have no obligation to provide
a standard service offer to a data center subject to this section.

(C)
The nameplate capacity of any electric generating facility built,
purchased, or upgraded for purposes of division (A)(1) of this
section shall be determined by multiplying the nameplate capacity of
the generating facility by the federal energy regulatory commission
reliability factor.

Sec.
4941.03.
Notwithstanding
any provision of the Revised Code to the contrary:

(A)
All direct costs associated with providing retail electric service to
data centers, including any generation costs, transmission costs, and
distribution costs, and costs associated with complying with section
4941.02 of the Revised Code, shall be allocated and recovered solely
from data center operators.

(B)
No other electric service customer in this state, other than a data
center operator, shall pay any amount described in division (A) of
this section.

(C)
An electric distribution utility shall not provide a standard service
offer to a data center.

Sec.
4941.04.
Notwithstanding
any provision of the Revised Code to the contrary:

(A)
Except as provided in section 4941.05 of the Revised Code, not later
than sixty days after the effective date of this section, each
electric distribution utility that does not have a currently approved
data center tariff that incorporates a separate set of terms and
conditions for data center operators shall file a tariff with the
public utilities commission that classifies data centers as a
separate rate class and allocates electric service costs for data
centers to data center operators. The data center tariff filing may
set minimum requirements for any of the following regarding data
centers:

(1)
Demand percentage;

(2)
Collateral;

(3)
Term length;

(4)
Exit and termination fees;

(5)
Any other factors deemed necessary and essential to ensure protection
for all other electric service customers in this state.

(B)
The commission shall ensure that a tariff under this section complies
with section 4941.03 of the Revised Code.

Sec.
4941.05.
(A)
Except as provided in division (B) of this section, sections 4941.02
to 4941.04 of the Revised Code do not apply to data center operators
that had contracted with an electric distribution utility for either
the provision of electric utility service or to otherwise construct
facilities to provide such service prior to the effective date of
this section.

(B)
Sections 4941.02 to 4941.04 of the Revised Code apply to a data
center operator described in division (A) of this section if that
operator makes a material capacity increase, as determined by the
public utilities commission.

(C)
With respect to an electric distribution utility that already has an
approved tariff that specifically addresses service to data center
operators as of the effective date of this section, sections 4941.02
to 4941.04 of the Revised Code do not apply to data center operators
during the term of a contract with such electric distribution utility
for electric utility services executed under that previously approved
tariff. Such an electric distribution utility with a previously
approved tariff shall still comply with sections 4941.02 to 4941.04
of the Revised Code and either obtain approval for a new tariff that
complies with those sections or seek a finding from the commission
confirming that the existing tariff complies with sections 4941.02 to
4941.04 of the Revised Code. If a new tariff is approved and becomes
effective, the terms of that updated tariff shall apply prospectively
and all contracts for electric utility services going forward from
that date will comply with sections 4941.02 to 4941.04 of the Revised
Code.

(D)
If there is a public utility proposal for a new tariff to
specifically address service to data center operators as of the
effective date of this section, the commission shall consider the
proposal under sections 4941.02 to 4941.04 of the Revised Code.

Sec.
4941.06.
(A)
The public utilities commission shall adopt rules necessary to
implement this chapter, including any necessary fees.

(B)
Notwithstanding any provision of section 121.95 of the Revised Code
to the contrary, a regulatory restriction contained in a rule adopted
under this section is not subject to sections 121.95 to 121.953 of
the Revised Code.

Sec.
5709.94.
(A)
As used in this section:

(1)
"Data center" has the same meaning as in section 122.17 of
the Revised Code.

(2)
"Tax incentive" means the programs and assistance provided
or administered by a political subdivision under Chapters 725. and
1728. and sections 3735.67 to 3735.70, 5709.40 to 5709.43, 5709.61 to
5709.69, 5709.73 to 5709.75, and 5709.77 to 5709.81 of the Revised
Code and any other section of the Revised Code under which a
political subdivision authorizes the exemption of property from
taxation, whether in whole or in part.

(B)
Notwithstanding anything in the Revised Code to the contrary:

(1)
Not more than fifty per cent of the increased value of real property
that is the site of, or constitutes, a data center may be exempted
from taxation pursuant to Chapters 725. and 1728. or sections 3735.65
to 3735.70, 5709.40 to 5709.43, 5709.61 to 5709.69, 5709.73 to
5709.75, or 5709.78 to 5709.83 of the Revised Code, and only the
increased value may be so exempted.

(2)
An ordinance or resolution creating an incentive district under
division (C) of section 5709.40 or 5709.73 or division (B) of section
5709.78 of the Revised Code may apply a different exemption
percentage to real property that is the site of, or that constitutes,
a data center than the exemption percentage that applies to other
real property within the incentive district.

(C)
Any political subdivision that provides a tax incentive for a data
center shall obtain security to ensure performance of any contractual
obligation required of the developer, owner, or operator of the data
center, and of the successors of any of those, in connection with the
incentive. The agreement detailing those obligations shall state the
total number of full-time employees to be employed at the data center
and the total projected salary for those employees over the first ten
years of the data center's operation. That total amount shall be the
minimum amount of the security, but the agreement may require
additional obligations and security.

The
security required by this division shall be one of the following:

(1)
A surety bond issued by a surety company authorized to do business in
this state in favor of the political subdivision;

(2)
Cash, certificates of deposit, or government securities.

The
developer, owner, or operator of the data center shall deposit the
security with the political subdivision that authorizes the tax
incentive before the tax commissioner or county auditor approves an
application for tax exemption based on the tax incentive pursuant to
section 5715.27 of the Revised Code. If certificates of deposit or
government securities are so deposited, any interest received shall
be paid to the person that deposited the certificates or securities.

Sec.
6111.70.
(A)
As used in this section, "data center" has the same meaning
as in section 4941.01 of the Revised Code.

(B)(1)
Any person that owns a data center shall install and utilize a
wastewater quality monitoring system to monitor the data center's
wastewater discharge in accordance with rules adopted under this
section.

(2)
The person that owns a data center shall submit a quarterly report to
the director of environmental protection regarding the data center's
wastewater quality measurements from the prior quarter. Such
quarterly report shall include a description of any anomalies that
the wastewater quality monitoring system detected during the
respective quarter in accordance with rules adopted by the director
of environmental protection under this section.

(C)
Not later than sixty days after the effective date of this section,
the director shall adopt rules in accordance with Chapter 119. of the
Revised Code establishing a wastewater testing and methodology plan
for data centers. Such rules also shall establish a requirement that
any person that owns a data center report wastewater quality data in
a manner and frequency established by the director.

(D)
Not later than the first day of February that occurs after the
effective date of this section, and every first day of February
thereafter, the director of environmental protection shall submit an
annual report that compiles data received from findings and reports
submitted under divisions (B) and (C) of this section to the chairs
of the house of representatives and senate committees that consider
energy legislation and natural resources legislation.

(E)
The director shall establish an annual fee to be paid by the person
that owns the data center to the environmental protection agency to
offset the costs of the agency in implementing this section. The fees
shall be deposited into the environmental protection fund created
under section 3745.015 of the Revised Code.

(F)(1)
The director shall adopt rules in accordance with Chapter 119. of the
Revised Code to administer and enforce this section, including
defining "anomalies" for purposes of this section.

(2)
Notwithstanding any provision of section 121.95 of the Revised Code
to the contrary, a regulatory restriction contained in a rule adopted
under this section is not subject to sections 121.95 to 121.953 of
the Revised Code.

Section
2.
That
existing sections 122.17
,

122.175
,
and 3745.015

of the Revised Code are hereby repealed.

Section
3.
(A)
The enactment by this act of section 5709.94 of the Revised Code
applies to tax exemptions authorized or approved on or after the
effective date of this section.

(B)
The amendment by this act of sections 122.17 and 122.175 of the
Revised Code applies to agreements entered into under that applicable
section on or after the effective date of this section.