SB 201: Revise milk inspection fees, agricultural commodity handler law

Section 1.

That section 917.031 be amended and section 926.181 of the Revised Code be enacted to read as follows:

Sec. 917.031. The milk sanitation board may do all of the following:

• (A) Advise and consult with the director of agriculture in the administration and enforcement of this chapter and rules adopted under it;
• (B) Make recommendations to the director regarding proposed rules;
• (C) Approve or disapprove agreements between the director and any public or private entity desiring to perform or performing any of the inspections or analyses required under this chapter and rules adopted under it;
• (D) After reviewing the director's annual report required under division (A)(7) of section 917.02 of the Revised Code, prescribe inspection fees for milk processors, and may prescribe inspection fees for milk producers, and milk haulers only if the appropriation from the general revenue fund for inspection purposes is less than the estimated cost of administering and enforcing this chapter. The board may modify any fees it has prescribed if the board prescribes fees, such fees, in conjunction with any appropriation, shall not exceed an amount necessary to cover the estimated costs of administering and enforcing this chapter. However, under no circumstances shall the fees prescribed or modified by the board together with the license fees collected pursuant to this chapter shall not exceed sixty-three per cent of the estimated cost of administering and enforcing this chapter, as determined by the board's review of the director's annual report. The board may modify any fees it has prescribed under this division, provided the fee amounts comply with this division.

Sec. 926.181.

(A) As used in this section:

• (1) "Failure" has the same meaning as in section 926.021 of the Revised Code.
• (2) "Large agricultural commodity handler" means an agricultural commodity handler that is licensed under section 926.06 of the Revised Code and that annually stores an amount of an agricultural commodity above a threshold that is determined by the director of agriculture.

(B) Each applicant for a handler's license that is a large agricultural commodity handler, as condition of receiving such license, shall execute and file or have on file with the director of agriculture a surety bond payable to the state and for deposit in the agricultural commodity depositors fund in case of the failure of the handler. The director shall establish the required amount of the surety bond based on the capacity of each large agricultural commodity handler in accordance with rules adopted by the director under Chapter 119. of the Revised Code. The surety bond shall be executed by a surety company authorized to do business in this state.

(C) The director shall not approve any bond until it is personally signed and acknowledged by both principal and surety, or as to either by the principal's or surety's attorney in fact, with a certified copy of the power of attorney attached thereto. The director shall not approve a bond unless there is attached a certificate of the superintendent of insurance that the company is authorized to transact a fidelity and surety business in this state. All bonds shall be given in a form to be prescribed by the director and shall run to the state as obligee.

Section 2.

That existing section 917.031 of the Revised Code is hereby repealed.

Section 3.

(A) As used in this section, "dairy processing plant" means a facility that:

• (1) Is located in this state;
• (2) Is in operation as of July 1, 2025; and
• (3) Provides processing services for dairy producers.

(B) The Director of Development shall establish a grant program for dairy processing plants. The Director shall prescribe the grant application form.

(C) The owner or operator of a dairy processing plant may apply to the Director for a grant under this section. Upon the receipt of a grant application, the Director shall review the application and score it based on the following criteria:

• (1) Whether the grant will improve the applicant's processing efficiencies for dairy products by allowing for the following:
• (a) New equipment, including upgrades to existing equipment;
• (b) New technology, including upgrades to existing technology; and
• (c) Training of personnel.
• (2) Whether the grant will be used for the expansion or new construction of facilities for the processing of dairy products, including:
• (a) Areas for the processing of dairy products; and
• (b) Refrigeration or freezers.
• (3) Whether the grant will be used for food safety certification or to assist in obtaining cooperative interstate shipment status;
• (4) Project readiness.

(D) For purposes of divisions (C)(1) through (4) of this section, the Director shall not consider the following as eligible for grant funding:

• (1) Improvements to personal residences;
• (2) Agricultural tractors, motorized vehicles, and other mobile equipment with an internal combustion engine;
• (3) Land purchases.

(E) Dairy processing plants awarded a grant under this section shall maintain the equipment, technology, plant expansion, or new construction in working and serviceable order for a period of five years after the awarding of the grant.

(F) The Director shall not award a grant to an applicant under this section for more than two hundred fifty thousand dollars.

Section 4.

All items in this act are hereby appropriated as designated out of any moneys in the state treasury to the credit of the designated fund. For all operating appropriations made in this act, those in the first column are for fiscal year 2026 and those in the second column are for fiscal year 2027. The operating appropriations made in this act are in addition to any other operating appropriations made for these fiscal years.

Section 5.

LOCAL FAIRS

The foregoing appropriation item 700512, Local Fairs, shall be used to support county and independent agricultural societies.

DAIRY PROCESSING GRANTS

The foregoing appropriation item 700516, Dairy Processing Grants, shall be used to administer the Dairy Processing Grants Program established in Section 3 of this act. The unexpended, unencumbered portion of appropriation item 700516, Dairy Processing Grants, at the end of fiscal year 2026 is hereby reappropriated for the same purpose in fiscal year 2027.

OHIO LIVESTOCK SHOW AND SALE

The foregoing appropriation item 700430, Ohio Livestock Show and Sale, shall be used to offset up to fifty per cent of the rental and equipment costs for state and national livestock events held at the Ohio Expo Center. On July 1 of each fiscal year, or as soon as possible thereafter, the Director of Budget and Management shall transfer $1,000,000 cash from the General Revenue Fund to the Ohio Livestock Show and Sale Fund (Fund 5CQ1), which is hereby created in the state treasury.

Section 6.

Section 7.

OHIO STATE AGRICULTURAL RESEARCH

The foregoing appropriation item 235535, Ohio State Agricultural Research, shall be disbursed through the Chancellor of Higher Education to the Ohio State University in monthly payments, unless otherwise determined by the Director of Budget and Management under section 126.09 of the Revised Code. The Ohio Agricultural Research and Development Center (OARDC), an entity of the College of Food, Agricultural, and Environmental Sciences (CFAES) of the Ohio State University, shall maintain its biosafety level three plant and animal agrosecurity research facility on the CFAES Wooster campus for conducting research on infectious diseases of plants and animals. OARDC shall further its mission of enhancing Ohio's economic development and job creation by continuing to internally allocate on a competitive basis appropriated funding of programs based on demonstrated performance. Academic units, faculty, and faculty-driven programs shall be evaluated and rewarded consistent with agreed-upon performance expectations as called for in the College's Expectations and Criteria for Performance Assessment.

THE OHIO STATE UNIVERSITY COLLEGE OF VETERINARY MEDICINE SUPPLEMENT

The foregoing appropriation item 235569, The Ohio State University College of Veterinary Medicine Supplement, shall be distributed through the Chancellor of Higher Education to the Ohio State University College of Veterinary Medicine to provide supplemental support for education, research, and operations.

Section 8.

Section 9.

CASH TRANSFER FROM THE GENERAL REVENUE FUND TO THE H2OHIO FUND

On July 1, 2025, or as soon as possible thereafter, the Director of Budget and Management shall transfer $120,276,066 cash from the General Revenue Fund to the H2Ohio Fund (Fund 6H20).

Section 10.

Within the limits set forth in this act, the Director of Budget and Management shall establish accounts indicating the source and amount of funds for each appropriation made in this act, and shall determine the manner in which appropriation accounts shall be maintained. Expenditures from operating appropriations contained in this act shall be accounted for as though made in, and are subject to all applicable provisions of, the main operating appropriations act of the 136th General Assembly.