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Legislative Committee Releases Study of Auto Industry Changes
Keary McCarthy

October 23, 2009 -- Co-Chairs Rep. Matt Lundy (D-Elyria) (Website | Profile) and Senator Mark Wagoner (R-Toledo) today released a report generated from statewide hearings for the Joint Select Committee on the Impact of the Changing Automobile Industry in Ohio. The committee, which held its hearings in August and September, was formed specifically to study the automobile industry as it relates to manufacturers, suppliers, dealers and consumers and to look at areas such as franchise laws, consumer protection issues and warranties.

“The changes that the auto industry is undergoing nationally have had a dramatic effect on Ohio’s own industry, as well as on Ohio’s economy,” said Rep. Lundy. “We formed this committee to study those crucial issues and their impact. Our report reflects the concerns that arose and our recommendations to address them. What is clear is that we must act to help the auto industry not only to recover but also to find new ways to prosper in a changing economy.”

“Auto manufacturing has played a critical role in our state’s industrial past and it must play a critical role in our future,” Sen. Wagoner said. “This report is a good start as we work to respond to dramatic changes in the economy that have affected so many Ohio families and small businesses, and demonstrates our state’s commitment to working cooperatively with the auto industry to improve our business climate and get Ohioans back to work.”

In addition to the co-chairs, members of the Joint Select Committee were Rep. Robert F. Hagan (D-Youngstown), Rep. Barbara R. Sears (R-Sylvania), Sen. Capri S. Cafaro (D-Hubbard) and Sen. Steve Buehrer (R-Delta).

“The Committee did an excellent job analyzing the challenges facing Ohio’s auto industry,” said Senate Democratic Leader Capri S. Cafaro. “The committee’s bipartisan recommendations are a substantive step in the right direction to improve an industry that is vital to Ohio’s economy.”

“This process has been very educational on many levels, I believe that we have drafted some strong recommendations many of which can be reasonably implemented,” said Rep. Sears (R-Sylvania). “I am amazed at how many times we heard ‘the tools already exist, they need to be more flexible.’ Through rules, regulations and requirements businesses were encouraged to seek out other options that fit their business plan. I’m looking forward to implementing many of these recommendations in a timely manner.”

“I have appreciated the opportunity to travel the state over the past several months and see first-hand how the auto industry impacts families and communities in Ohio. This valuable insight will serve my colleagues and I well as we work to address the many challenges facing auto dealers, workers, suppliers and manufacturers in our state,” said Sen. Buehrer. “The auto task force’s report is an important first step as we work to develop a comprehensive strategy for how to revive Ohio’s auto industry and help preserve and grow auto-related jobs.”

In five hearings total, the committee traveled to Toledo, Lorain, Warren, Dayton, and Shelby. They heard testimony from vehicle manufacturers, parts suppliers, auto dealers, industry workers and community members. All spoke to the unprecedented circumstances they’ve faced due to the current crisis.

The committee’s final report addresses these challenges and makes recommendations concerning Ohio laws regulating the automobile industry. Recommendations include tools for enhancing the economic development of the auto industry, employee protections, worker training and education initiatives, tax incentives and programs, and franchise law improvements.

Highlights of the Joint Select Committee’s Recommendations

Economic Development

  • Designate a point person in the Department of Development (“Auto Development Director”) to streamline the industry’s regulation.

  • Create a system of regional incentives that fosters regional collaboration and support of Ohio workers and businesses.

  • Improve credit availabilities to auto dealers and suppliers.

Employee Protections

  • Find ways to hold manufacturers accountable for health insurance and pension obligations to Ohio auto industry workers.

  • Urge Congress to take up the issue of pension protection reform and bankruptcy law reform, in order to help manufacturers keep promises to employees and to ensure greater protections for Ohio businesses and consumers.

Worker Training and Education

  • Promote world-class automotive research to keep Ohio ahead of the curve, utilizing already existing tools like Ohio’s Research Scholars Program.

  • Retool worker training programs to maintain Ohio’s highly skilled auto workforce, with a focus on better partnerships with development programs and an evaluation of current economic development programs.

Tax Incentives and Programs

  • Restructure Ohio’s Job Retention and Job Creation Tax Credits to broaden eligibility and simplify reporting requirements.

  • Foster a more favorable tax environment through the use of Third Frontier funds and to incentivize the use of Ohio-based construction companies and suppliers.

  • Revitalize closed manufacturers and supply facilities through tax credits, community outreach, improved regulations, and the engagement of state agencies.

  • Help suppliers diversify into other industries, such as advanced energy.

Franchise Law Improvements

  • Begin conversation about reshaping Ohio’s auto dealership laws to address problems faced by Ohio auto dealers during the recent large auto manufacturers’ bankruptcies.

  • Ensure a responsive and timely motor vehicles dealers board.

Click here to read the report: Joint Select Committee on the Impact of the Changing Automobile Industry in Ohio

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