Article VIII, Section 2m | Issuance of general obligations
(A) In addition to the authorizations otherwise contained in Article VIII of the Ohio Constitution, the General Assembly may provide by law, in accordance with but subject to the limitations of this section, for the issuance of bonds and other obligations of the state for the purpose of financing or assisting in the financing of the cost of public infrastructure capital improvements of municipal corporations, counties, townships, and other governmental entities as designated by law, and the cost of highway capital improvements. As used, in this section, public infrastructure capital improvements shall be limited to roads and bridges, waste water treatment systems, water supply systems, solid waste disposal facilities, and storm water and sanitary collection, storage, and treatment facilities, including real property, interests in real property, facilities, and equipment related to or incidental thereto, and shall include without limitation the cost of acquisition, construction, reconstruction, expansion, improvement, planning, and equipping. As used in this section, highway capital improvements shall be limited to highways, including those on the state highway system and urban extensions thereof, those within or leading to public parks or recreation areas, and those within or leading to municipal corporations, and shall include without limitation the cost of acquisition, construction, reconstruction, expansion, improvement, planning, and equipping.
It is hereby determined that such public infrastructure capital improvements and highway capital improvements are necessary to preserve and expand the public capital infrastructure of the state and its municipal corporations, counties, townships, and other governmental entities, ensure the public health, safety, and welfare, create and preserve jobs, enhance employment opportunities, and improve the economic welfare of the people of this state.
(B) Not more than one hundred twenty million dollars prinicipal amount of the infrastructure obligations authorized to be issued under this section, plus the principal amount of infrastructure obligations that in any prior fiscal years could have been but were not issued within the one-hundred-twenty-million-dollar fiscal year limit, may be issued in any fiscal year, provided that the aggregate total principal amount of infrastructure obligations issued under this section for public infrastructure capital improvements may not exceed one billion two hundred million dollars; and provided further that no infrastructure obligations shall be issued pursuant to this section until at least one billion one hundred ninety-nine million five hundred thousand dollars aggregate principal amount of obligations have been issued pursuant to Section 2k of Article VIII. Not more than two hundred twenty million dollars principal amount of highway obligations authorized to be issued under this section, plus the principal amount of highway obligations that in any prior fiscal years could have been but were not issued within the two-hundred-twenty-million-dollar fiscal year limit, may be issued in any fiscal year, and not more than one billion two hundred million dollars principal amount of highway obligations issued under this section may be outstanding at any one time. Further limitations may be provided by law upon the amount of infrastructure obligations and highway obligations, hereinafter collectively called obligations, that may be issued under this section in any fiscal year in order that the total debt charges of the state payable from the general revenue fund shall not exceed a proportion of general revenue fund expenditures that would adversely affect the credit rating of the state. If obligations are issued under this section to retire or refund obligations previously issued under this section, the new obligations shall not be counted against those fiscal year or total issuance limitations to the extent that their principal amount does not exceed the principal amount of the obligations to be retired or refunded.
Provision shall be made by law for the use to the extent practicable of Ohio products, materials, services, and labor in the making of any project financed, in whole or in part, under this section.
(C) The state may participate in any public infrastructure capital improvement or highway capital improvement under this section with municipal corporations, counties, townships, or other governmental entities as designated by law, or any one or more of them. Such participation may be by grants, loans, or contributions to them for any such capital improvements. The entire proceeds of the infrastructure obligations shall be used for public infrastructure capital improvements of municipal corporations, counties, townships, and other governmental enties, except to the extent that the General Assembly provides by law that the state may reasonably be compensated from such moneys for planning, financial management, or administrative services performed in relation to the issuance of infrastructure obligations.
(D) Each issue of obligations shall mature in not more than thirty years from the date of issuance, or, if issued to retire or refund other obligations, within thirty years from the date the debt originally was contracted. If obligations are issued as notes in anticipation of the issuance of bonds, provision shall be made by law for the establishment and maintenance, during the period in which the notes are outstanding, of a special fund or funds into which shall be paid, from the sources authorized for the payment of such bonds, the amount that would have been sufficient, if bonds maturing during a period of thirty years had been issued without such prior issuance of notes, to pay the principal that would have been payable on such bonds during such period. Such fund or funds shall be used solely for the payment of principal of such notes or bonds in anticipation of which such notes have been issued.
The obligations are general obligations of the state. The full faith and credit, revenue, and taxing power of the state shall be pledged to the payment of the principal of and premium and interest and other accreted amounts on outstanding obligations as they become due, hereinafter called debt service, and bond retirement fund provisions shall be made for payment of debt service. Provision shall be made by law for the sufficiency and appropriation, for purposes of paying debt service, of excises, taxes, and revenues so pledged to debt service, and for covenants to continue the levy, collection, and application of sufficient excises, taxes, and revenues to the extent needed for such purpose. Notwithstanding Section 22 of Article II, Ohio Constitution, no further act of appropriation shall be necessary for that purpose. The obligations and the provision for the payment of debt service, and repayment by governmental entities of any loans made under this section are not subject to Sections 5, 6, and 11 of Article XII, Ohio Constitution.
The moneys referred to in Section 5a of Article XII, Ohio Constitution may be pledged to the payment of debt service on highway obligations, but may not be pledged to the payment of debt service on infrastructure obligations. In each year that moneys referred to in Section 5a of Article XII, Ohio Constitution pledged to the payment of debt service on highway obligation issued under this section are available for such purpose, such moneys shall be appropriated thereto and the required application of any other excises and taxes shall be reduced in corresponding amount.
The obligations issued under authority of this section, the transfer thereof, and the interest, interest equivalent, and other income and accreted amounts therefrom, including any profit made on the sale, exchange, or other disposition thereof, shall at all times be free from taxation within the state.
(E) This section shall otherwise be implemented in the manner and to the extent provided by law by the General Assembly, including provision for the procedure for incurring and issuing obligations, separately or in combination with other state obligations, and refunding, retiring, and evidencing obligations.
(F) The authorizations in this section are in addition to authorizations contained in other sections of Article VIII, Ohio Constitution, are in addition to and not a limitation upon the authority of the General Assembly under other provisions of this Constitution, and do not impair any law previously enacted by the General Assembly, except that after December 31, 1996, no additional highway obligation of the state may be issued for any highway purposes under Section 2i of Article VIII, Ohio Constitution, except to refund highway obligations issued under Section 2i that are outstanding on that date.