Enact the S.B. 1 Compliance Supplemental Appropriation Act

As Introduced

136th
General Assembly

Regular
Session
H. B. No. 698

2025-2026

Representative Young

To
amend
sections
113.70, 113.73, 3345.45, and
3345.454;
to enact sections 107.037, 3345.0220, 3345.0221, and 3345.0222; and
to repeal section 3345.456 of the Revised Code
to
enact the S.B. 1 Compliance Supplemental Appropriation Act regarding
the operation of state institutions of higher education.

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

Section
1.
That

sections
113.70, 113.73, 3345.45, and
3345.454
be amended and sections 107.037, 3345.0220, 3345.0221, and 3345.0222
of the Revised Code be enacted to read as follows:

Sec.
107.037.
As
used in this section, "state institution of higher education"
has the same meaning as in section 3345.011 of the Revised Code.

The
governor shall ensure that among the various budget recommendations
made by the governor and the director of budget and management to the
general assembly each biennium there are recommendations to set aside
a portion of the state share of instruction funds for state
institutions of higher education for the purposes of sections
3345.0220 and 3345.0222 of the Revised Code. The state share of
instruction funds in that set aside shall be calculated and
distributed in the same manner as any other state share of
instructions funds, except that their release to each state
institution is subject to those sections.

Sec.
113.70.
As
used in sections 113.70 to 113.77 of the Revised Code:

(A)
"Expenditure" means a payment, distribution, loan, advance,
reimbursement, deposit, or gift of money from a state entity to any
supplier.

(B)
"Political subdivision" means a county, city, village,
public library, township, park district, school district, regional
water and sewer district, or regional transit authority.

(C)
"Public library" means a library that is created,
maintained, and regulated under Chapter 3375. of the Revised Code.

(D)
"School district" means a city, local, exempted village, or
joint vocational school district; a science, technology, engineering,
and mathematics school established under Chapter 3326. of the Revised
Code; or an educational service center. "School district"
does not mean a community school established under Chapter 3314. of
the Revised Code.

(E)
"State entity" means the general assembly, the supreme
court, the court of claims, the office of an elected state officer,
or a department, bureau, board, office, commission, agency,
institution, instrumentality, or other governmental entity of this
state established by the constitution or laws of this state for the
exercise of any function of state government, but excludes a
political subdivision, an institution of higher education, a state
retirement system, and the city of Cincinnati retirement system.
"State entity" does not include the nonprofit corporation
formed under section 187.01 of the Revised Code.

(F)

"State
institution of higher education" has the same meaning as in
section 3345.011 of the Revised Code.

(G)

"State
retirement system" means the public employees retirement system,
the Ohio police and fire pension fund, the state teachers retirement
system, the school employees retirement system, and the state highway
patrol retirement system.

(G)
(H)

"Supplier" means any person, partnership, corporation,
association, organization, state entity, or other party, including
any executive officer, legislative officer, judicial officer, or
member or employee of a state entity, that does either of the
following:

(1)
Sells, leases, or otherwise provides equipment, materials, goods,
supplies, or services to a state entity pursuant to a contract
between the supplier and a state entity;

(2)
Receives reimbursement from a state entity for any expense.

Sec.
113.73.
(A)
The Ohio state and local government expenditure database shall
include the following features:

(1)
A searchable database of all expenditures;

(2)
The ability to filter expenditures by the following categories:

(a)
The category of expense;

(b)
The Ohio administrative knowledge system accounting code for a
specific good or service.

(3)
The ability to search and filter by any of the factors listed in
section 113.72 of the Revised Code;

(4)
The ability to aggregate data contained in the database;

(5)
The ability to determine the total amount of expenditures awarded to
a supplier by a state entity;

(6)
The ability to download information obtained through the database;

(7)
A searchable database of state

and
,

school
district
,
and state institution of higher education

employee salary and employment information.

(B)
The information required under division (A)(7) of this section shall
be provided by the department of administrative services

or
,

the department of education and workforce
,
or a state institution of higher education
,
as applicable.

Sec.
3345.0220.
(A)
As used in this section, "state institution of higher education"
has the same meaning as in section 3345.011 of the Revised Code.

(B)
Each state institution of higher education shall annually certify
compliance with sections 3333.045, 3345.029, 3345.0216, 3345.0217,
3345.382, 3345.451, 3345.453, and 3345.591 of the Revised Code. Each
state institution shall certify its compliance to the chancellor of
higher education as follows:

(1)
For fiscal year 2027, on the effective date of this section;

(2)
For fiscal year 2028 and each fiscal year thereafter, by the first
day of July of that fiscal year.

(C)
For fiscal year 2028 and each fiscal year thereafter, the chancellor
shall withhold a state institution's portion of any state share of
instruction funds in the set aside for that fiscal year for the
purposes of this section if that institution fails to file a
certification in that fiscal year as required under this section.

(D)
The chancellor may audit institutional records, require
documentation, and conduct reviews to verify a state institution's
certification.

(E)(1)
A recklessly false or fraudulent certification constitutes
noncompliance with this section. For fiscal year 2028 and each fiscal
year thereafter, a recklessly false or fraudulent certification
constitutes grounds for the chancellor to withhold the entirety of a
state institution's portion of any state institution's state share of
instruction funds in the set aside for that fiscal year for the
purposes of this section.

(2)
A recklessly false or fraudulent certification may subject the state
institution or responsible officers to civil penalties.

(F)
Any state share of instruction funds withheld from a state
institution under this section for a fiscal year shall not be
released regardless of subsequent compliance with this section.

Sec.
3345.0221.
(A)
As used in this section:

(1)
"State institution of higher education" has the same
meaning as in section 3345.011 of the Revised Code.

(2)
"Substantially different duties" means material changes in
primary responsibilities or supervisory authority. "Substantially
different duties" does not include temporary assignments, title
changes, or minor duty adjustments.

(B)
No state institution of higher education shall reassign, reclassify,
or otherwise disguise any position to continue diversity, equity, and
inclusion functions prohibited by section 3345.0217 of the Revised
Code.

(C)
Each state institution shall prepare an inventory of all employees
who, on January 1, 2025, performed diversity, equity, and inclusion
functions and who were reassigned on or before September 25, 2025.
The inventory shall include:

(1)
Employee name, title, and unit;

(2)
Prior duties related to diversity, equity, and inclusion;

(3)
Reassignment details;

(4)
Salary changes;

(5)
New duties;

(6)
Attestation of accuracy by the chief human resources officer and
general counsel.

(D)(1)
For each employee described in division (C) of this section, a state
institution shall prepare a justification report containing:

(a)
A narrative explanation of the employee's reassignment;

(b)
Proof that the employee's reassignment consists of substantially
different duties from diversity, equity, and inclusion functions;

(c)
Side-by-side job comparisons;

(d)
Attestation of accuracy by the institution's general counsel;

(e)
Itemized compensation breakdown;

(f)
Compliance plan for ongoing review;

(g)
Certification by the president and chair of the board of trustees.

(2)
The chancellor of higher education shall determine whether the
evidence submitted by an institution under division (D)(1)(b) of this
section sufficiently establishes that an employee's new duties are
substantially different from diversity, equity, and inclusion
functions. The chancellor shall make this determination using a
preponderance of the evidence standard.

(E)
Each state institution of higher education shall submit the
inventories and reports described in divisions (C) and (D) of this
section to the chancellor not later than ninety days after the
effective date of this section. Beginning with fiscal year 2028, each
state institution shall submit updated inventories and reports
regarding employees described in division (C) of this section
annually not later than the first day of July.

(F)
Inventories and reports submitted by state institutions under this
section are public records.

Sec.
3345.0222.
(A)
As used in this section, "state institution of higher education"
has the same meaning as in section 3345.011 of the Revised Code.

(B)
The president of a state institution of higher education and the
chair of the board of trustees of the institution shall sign each
certification, inventory, and report submitted by the institution as
required under sections 3345.0220 and 3345.0221 of the Revised Code.

(C)
If a state institution of higher education fails to comply with the
requirements of sections 3345.0220, 3345.0221, or 3345.454 of the
Revised Code as amended or enacted by this act in a fiscal year, for
fiscal year 2028 and each fiscal year thereafter, the chancellor of
higher education shall withhold a state institution's portion of any
state share of instruction funds in the set aside for that fiscal
year for the purposes of this section.

(D)
Any state share of instruction funds withheld from a state
institution of higher education under this section shall not be
released regardless of subsequent compliance with this section.

Sec.
3345.45.
(A)

The
chancellor of higher education jointly with all state institutions

The
board of trustees of each state institution
of
higher education, as defined in section 3345.011 of the Revised Code,
shall
develop
standards for
adopt
an
instructional

workloads

workload
policy
for
full-time and part-time faculty
in
keeping with the institutions' missions and with special emphasis

that
maintains a primary emphasis
on

the

undergraduate

learning
experience. The standards shall contain clear guidelines for
institutions to determine a range of acceptable undergraduate
teaching by faculty
instruction.
An instructional workload policy shall not establish a minimum
workload that falls below the prevailing Ohio standards for
undergraduate instruction. The chancellor of higher education shall
not prescribe alternative ranges or minimum standards for
instructional workload policies
.

(B)
The board of trustees of each state institution of higher education
shall take formal action to adopt a faculty workload policy
consistent with the standards developed under this section.

(C)(1)
(B)(1)

The board of trustees of each state institution of higher education
shall review the institution's policy on faculty tenure and update
that policy to promote excellence in instruction, research, service,
or commercialization, or any combination thereof.

(2)
As a condition for a state institution of higher education to receive
any state funds for research that are allocated to the department of
higher education under the appropriation line items referred to as
either "research incentive third frontier fund" or
"research incentive third frontier-tax," the chancellor
shall require the institution to include multiple pathways for
faculty tenure, one of which may be a commercialization pathway, in
its policy.

(D)(1)
(C)(1)

At least once every five years, each state institution of higher
education shall update its faculty workload policy and submit the
policy to the chancellor. The updated policies shall be approved by
the state institution's board of trustees each time it is submitted
to the chancellor.

(2)
Each state institution of higher education's faculty workload policy
shall include all of the following:

(a)
An objective and numerically defined teaching workload expectation
based on credit hours as defined in 34 C.F.R. 600.2;

(b)
A definition of all faculty workload elements in terms of credit
hours as defined in 34 CFR 600.2 with a full-time workload minimum
standard established by the board of trustees and made publicly
accessible on the state institution's web site;

(c)
A definition of justifiable credit hour equivalents for activities
other than teaching, including research, clinical care,
administration, service, and other activities as determined by the
state institution of higher education;

(d)
Administrative action that a state institution of higher education
may take, including censure, remedial training, for-cause
termination, or other disciplinary action, regardless of tenure
status, if a faculty member fails to comply with the policy's
requirements. Termination under these circumstances requires the
recommendation of the dean, provost, or equivalent official,
concurrence of the state institution of higher education's president,
and approval of the state institution of higher education's board of
trustees.

Sec.
3345.454.
This
section applies only to state institutions of higher education that
have tenured faculty members.

(A)
As used in this section:

(1)
"State institution of higher education" has the same
meaning as in section 3345.011 of the Revised Code.

(2)
"Retrenchment" means a process by which a state institution
of higher education reduces programs or services, thus resulting in a
temporary suspension or permanent separation of one or more
institution faculty, to account for a reduction in student population
or overall funding, a change to institutional missions or programs,
or other fiscal pressures or emergencies facing the institution.

(3)
"Faculty" means any employee holding a full-time faculty
appointment at a state institution of higher education, regardless of
tenure status, rank, track, or title.

(4)
"Academic unit" means any college, school, department,
program, division, or other organizational unit within a state
institution of higher education.

(B)
In addition to the policies described in sections 3345.45 to 3345.453
of the Revised Code, each state institution of higher education board
of trustees shall develop policies on tenure and retrenchment

consistent with this section
.

Each
state institution shall submit those policies to the chancellor of
higher education. Each state institution's board of trustees shall
update those policies every five years.

(C)
(1)
Not later than ninety days after the effective date of this
amendment, each state institution of higher education board of
trustees shall adopt a retrenchment policy that specifies all of the
following:

(a)
That the authority to initiate retrenchment is held by the board of
trustees;

(b)
That the board of trustees may delegate its authority to initiate
retrenchment to the president or provost of the institution;

(c)
That a dean or comparable academic officer may recommend retrenchment
but may not unilaterally initiate it;

(d)
That the provost, in consultation with the president, shall
administer and complete the retrenchment process subject to any
parameters imposed by the board of trustees;

(e)
That retrenchment may be initiated for any lawful academic or
operational reason determined by the board of trustees, including
enrollment stagnation or decline, program reduction or
discontinuation, organizational restructuring, business necessity,
institutional strategic realignment, financial emergency, or other
lawful reasons;

(f)
That before finalizing retrenchment decisions, the provost shall
consider relevant factors that affect the institution and students,
including program interdependence, student completion pathways,
feasibility of phased reductions, academic reputation, alternative
organizational arrangements, potential redeployment of affected
faculty, and attrition or voluntary separation as alternatives to
retrenchment;

(g)
That the provost's consideration of relevant factors under division
(C)(1)(f) of this section does not create enforceable rights beyond
those expressly provided in the policy and this section;

(h)
That selection, retention, and non-displacement standards may affect
multiple faculty positions;

(i)
That when fewer than all faculty positions within an academic unit
are retrenched, the institution shall retain faculty members the
provost determines are best qualified to meet programmatic,
curricular, and institutional needs;

(j)
Except as provided in division (C)(2) of this section, that
seniority, tenure, rank, or length of service do not confer a right
of retention;

(k)
That a faculty member whose position is selected for retrenchment may
not displace or bump another faculty member;

(l)
That a faculty member whose position is selected for retrenchment
shall receive written notice in a form and at a time determined by
the board of trustees and set forth in the policy;

(m)
That during the notice period specified by the board of trustees in
the policy under division (C)(1)(l) of this section, a faculty member
shall remain subject to applicable institutional policies and
performance expectations unless relieved of duties by the
institution;

(n)
That a faculty member whose position is selected for retrenchment
shall receive procedural protections substantially similar to those
historically afforded by the institution, including written notice
identifying the position selected for retrenchment and effective
date, an opportunity to meet with a designated administrator to
discuss the retrenchment decision as it relates to the faculty
member's position, and a limited internal review or appeal process
confined to whether the institution materially complied with its
policy and this section;

(o)
That retrenchment is not a disciplinary action and no review may
substitute the board of trustee's judgment regarding academic,
programmatic, or institutional needs;

(p)
That the board of trustees may approve a buyout program, voluntary
separation incentive, or other negotiated separation arrangements for
faculty positions subject to retrenchment when the board determines
those arrangements to be cost effective or in the best financial or
operational interests of the institution;

(q)
That participation in programs described in division (C)(1)(p) of
this section is voluntary unless otherwise authorized by law;

(r)
The provost may adopt written procedures to implement retrenchment,
including timelines, documentation standards, verification processes,
and notice formats;

(s)
Any procedures adopted by the provost pursuant to division (C)(1)(r)
of this section shall be publicly accessible.

(2)
A policy on retrenchment adopted under division (C)(1) of this
section shall specify that a faculty member whose position is
selected for retrenchment who, at the time the faculty member
receives notice of the selection, has at least thirty but not more
than thirty-five years of service credit in a state retirement system
shall be exempt from retrenchment until the faculty member attains
thirty-five years of service credit. The policy shall require
verification of the faculty member's service credit within fifteen
days after the faculty member receives notice that the member's
position has been selected for retrenchment. Consistent with section
3345.454 of the Revised Code, division (C)(2) of this section
prevails over any conflicting provision of a collective bargaining
amendment entered into on or after the effective date of this
amendment.

(D)
Each state institution of higher education's board of trustees shall
update a policy adopted under this section not less than once every
five years. Whenever a state institution of higher education board of
trustees adopts or modifies a policy under this section, the board of
trustees shall submit it to the chancellor of higher education.

(E)
The chancellor shall review each retrenchment policy submitted under
this section to determine whether the policy complies with the
requirements of this section. If the chancellor determines that a
submitted retrenchment policy complies with this section, the
chancellor shall notify the board of trustees of the determination.
If the chancellor determines that a submitted policy does not comply
with this section, the chancellor shall notify the board of trustees
in writing and identify the specific provisions that fail to comply.
The chancellor's review under this division shall be limited to
determining compliance with the requirements of this section and
shall not include approval, disapproval, or modification of the
substantive academic, managerial, or strategic judgments in the
policy.

(F)
A board of trustees that receives a notice of noncompliance under
division (E) of this section shall revise and resubmit the policy not
more than sixty days after receipt of the notice of noncompliance.

(G)
If a retrenchment policy has been in place for less than five years
and has been determined by the chancellor to be in compliance with
this section, the chancellor is prohibited from changing that
determination unless the policy is updated or this section is
amended.

(H)
Nothing in this section shall be construed to limit or otherwise
impair the authority of a board of trustees of a state institution of
higher education to adopt, amend, or enforce additional provisions
relating to retrenchment that do not conflict with this section. The
authority to determine, implement, and administer retrenchment
policies and decisions rests with the board of trustees, including
authority delegated by the board to the president or provost. This
section establishes minimum statewide requirements and shall not be
construed to prohibit a board of trustees from exercising broader or
more specific authority with respect to retrenchment.

(I)

A
state institution of higher education shall eliminate any
undergraduate degree program it offers if the institution confers an
average of fewer than five degrees in that program annually over any
three-year period. A state institution shall not consider any
academic year prior to the first academic year in which an
undergraduate degree is conferred in determining whether this
division applies to the program offering that degree.

The
chancellor may grant a waiver to a state institution for a program to
which this division applies. State institutions shall appeal for a
waiver in a form and manner determined by the chancellor. If the
chancellor grants a waiver to a state institution, the chancellor
shall establish terms under which the state institution may
conditionally continue the program, including whether the program is
eligible to be supported by state share of instruction funds.

Section
2.
That
existing
sections
113.70, 113.73, 3345.45, and
3345.454
of the Revised Code
are

hereby
repealed.

Section
3.
That
section 3345.456 of the Revised Code is hereby repealed.

Section
4.
(A)
As used in this section, "state university" has the same
meaning as in section 3345.011 of the Revised Code.

(B)
On the effective date of this section, the Chancellor of Higher
Education shall determine whether each state university is in
compliance with section 3345.0220 of the Revised Code. If the
Chancellor determines that a state university is noncompliant with
that section, the Chancellor shall withhold the state university's
portion of the state share of instruction funds in the set aside in
division (B)(1)(c) of Section 381.250 of H.B. 96 of the 136th General
Assembly, beginning with the first disbursement that occurs after the
determination is made.

(C)
Ninety-one days after the effective date of this section, the
Chancellor shall determine whether each state university is in
compliance with sections 3345.0220, 3345.0221, 3345.0222, and
3345.454 of the Revised Code. If the Chancellor determines that a
state university is noncompliant with any of those sections, the
Chancellor shall withhold the state university's portion of the state
share of instruction funds in the set aside in division (B)(1)(c) of
Section 381.250 of H.B. 96 of the 136th General Assembly, beginning
with the first disbursement that occurs after the determination is
made.

(D)
If, at any time following a determination made under division (B) or
(C) of this section, the Chancellor becomes aware of potential
noncompliance by a state university of any section of the Revised
Code for which a determination was made, the Chancellor may
investigate compliance at the state university and make an additional
determination. If the Chancellor determines that a state university
is noncompliant with one of the applicable sections, the Chancellor
shall withhold the state university's portion of the state share of
instruction funds in the set aside in division (B)(1)(c) of Section
381.250 of H.B. 96 of the 136th General Assembly, beginning with the
first disbursement that occurs after the additional determination is
made.

(E)
At any time following a determination made under division (B), (C),
or (D) of this section, a state university that has been determined
noncompliant may request an additional determination from the
Chancellor to evaluate whether the state university has resolved the
noncompliance. If the Chancellor determines that a state university
has become compliant, the Chancellor shall resume disbursing the
state university's portion of the state share of instruction funds in
the set aside in division (B)(1)(c) of Section 381.250 of H.B. 96 of
the 136th General Assembly, beginning with the first disbursement
that occurs after the new determination is made.

(E)
Any state share of instruction funds withheld from a state
institution under this section shall not be released regardless of
subsequent compliance determinations.

Section
5.
This
act shall be known as the S.B. 1 Compliance Supplemental
Appropriation Act.