Bill Text: OH HB133 | 2011-2012 | 129th General Assembly | Engrossed

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: To create the Oil and Gas Leasing Commission, to establish a procedure for leasing land owned or under the control of state agencies for oil and gas production in order to provide funding for capital costs for the agencies, and to exclude nature preserves from drilling.

Spectrum: Partisan Bill (Republican 47-1)

Status: (Passed) 2011-09-30 - Effective Date [HB133 Detail]

Download: Ohio-2011-HB133-Engrossed.html

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As Passed by the House

129th General Assembly Regular Session 2011-2012

Am. Sub. H. B. No. 133

Representative Adams, J. 

Cosponsors: Representatives Beck, Blessing, Boose, Brenner, Buchy, Burke, Combs, Gonzales, Goodwin, Grossman, Hackett, Hall, Hayes, Huffman, Landis, Maag, Martin, McKenney, Rosenberger, Ruhl, Sears, Stebelton, Thompson, Uecker, Wachtmann, Young, Amstutz, Blair, Hagan, C., Hottinger, Mecklenborg, Newbold, Roegner, Slaby 

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A BILL

To amend sections 123.01, 1531.06, 1531.33, and

1

3345.181, to enact sections 131.50, 1503.012,

2

1509.70, 1509.71, 1509.72, 1509.73, 1509.74,

3

1509.75, 1509.76, 1509.77, and 1541.26, and to

4

repeal sections 5119.40, 5120.12, and 5123.23 of

5

the Revised Code to create the Oil and Gas Leasing

6

Commission, to establish a procedure for leasing

7

land owned or under the control of state agencies

8

for oil and gas production in order to provide

9

funding for capital costs for the agencies, and to

10

exclude nature preserves from drilling.

11

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

Section 1. That sections 123.01, 1531.06, 1531.33, and	12
3345.181 be amended and sections 131.50, 1503.012, 1509.70,	13
1509.71, 1509.72, 1509.73, 1509.74, 1509.75, 1509.76, 1509.77, and	14
1541.26 of the Revised Code be enacted to read as follows:	15

Sec. 123.01.  (A) The department of administrative services,	16
in addition to those powers enumerated in Chapters 124. and 125.	17
of the Revised Code and provided elsewhere by law, shall exercise	18
the following powers:	19

(1) To prepare, or contract to be prepared, by licensed	20
engineers or architects, surveys, general and detailed plans,	21
specifications, bills of materials, and estimates of cost for any	22
projects, improvements, or public buildings to be constructed by	23
state agencies that may be authorized by legislative	24
appropriations or any other funds made available therefor,	25
provided that the construction of the projects, improvements, or	26
public buildings is a statutory duty of the department. This	27
section does not require the independent employment of an	28
architect or engineer as provided by section 153.01 of the Revised	29
Code in the cases to which that section applies nor affect or	30
alter the existing powers of the director of transportation.	31

(2) To have general supervision over the construction of any	32
projects, improvements, or public buildings constructed for a	33
state agency and over the inspection of materials previous to	34
their incorporation into those projects, improvements, or	35
buildings;	36

(3) To make contracts for and supervise the construction of	37
any projects and improvements or the construction and repair of	38
buildings under the control of a state agency, except contracts	39
for the repair of buildings under the management and control of	40
the departments of public safety, job and family services, mental	41
health, developmental disabilities, rehabilitation and correction,	42
and youth services, the bureau of workers' compensation, the	43
rehabilitation services commission, and boards of trustees of	44
educational and benevolent institutions and except contracts for	45
the construction of projects that do not require the issuance of a	46
building permit or the issuance of a certificate of occupancy and	47
that are necessary to remediate conditions at a hazardous waste	48
facility, solid waste facility, or other location at which the	49
director of environmental protection has reason to believe there	50
is a substantial threat to public health or safety or the	51
environment. These contracts shall be made and entered into by the	52
directors of public safety, job and family services, mental	53
health, developmental disabilities, rehabilitation and correction,	54
and youth services, the administrator of workers' compensation,	55
the rehabilitation services commission, the boards of trustees of	56
such institutions, and the director of environmental protection,	57
respectively. All such contracts may be in whole or in part on	58
unit price basis of maximum estimated cost, with payment computed	59
and made upon actual quantities or units.	60

(4) To prepare and suggest comprehensive plans for the	61
development of grounds and buildings under the control of a state	62
agency;	63

(5) To acquire, by purchase, gift, devise, lease, or grant,	64
all real estate required by a state agency, in the exercise of	65
which power the department may exercise the power of eminent	66
domain, in the manner provided by sections 163.01 to 163.22 of the	67
Revised Code;	68

(6) To make and provide all plans, specifications, and models	69
for the construction and perfection of all systems of sewerage,	70
drainage, and plumbing for the state in connection with buildings	71
and grounds under the control of a state agency;	72

(7) To erect, supervise, and maintain all public monuments	73
and memorials erected by the state, except where the supervision	74
and maintenance is otherwise provided by law;	75

(8) To procure, by lease, storage accommodations for a state	76
agency;	77

(9) To lease or grant easements or licenses for unproductive	78
and unused lands or other property under the control of a state	79
agency. Such leases, easements, or licenses shall be granted for a	80
period not to exceed fifteen years and shall be executed for the	81
state by the director of administrative services and the governor	82
and shall be approved as to form by the attorney general, provided	83
that leases, easements, or licenses may be granted to any county,	84
township, municipal corporation, port authority, water or sewer	85
district, school district, library district, health district, park	86
district, soil and water conservation district, conservancy	87
district, or other political subdivision or taxing district, or	88
any agency of the United States government, for the exclusive use	89
of that agency, political subdivision, or taxing district, without	90
any right of sublease or assignment, for a period not to exceed	91
fifteen years, and provided that the director shall grant leases,	92
easements, or licenses of university land for periods not to	93
exceed twenty-five years for purposes approved by the respective	94
university's board of trustees wherein the uses are compatible	95
with the uses and needs of the university and may grant leases of	96
university land for periods not to exceed forty years for purposes	97
approved by the respective university's board of trustees pursuant	98
to section 123.77 of the Revised Code.	99

(10) To lease space for the use of a state agency;

100

(11) To have general supervision and care of the storerooms,	101
offices, and buildings leased for the use of a state agency;	102

(12) To exercise general custodial care of all real property	103
of the state;	104

(13) To assign and group together state offices in any city	105
in the state and to establish, in cooperation with the state	106
agencies involved, rules governing space requirements for office	107
or storage use;	108

(14) To lease for a period not to exceed forty years,	109
pursuant to a contract providing for the construction thereof	110
under a lease-purchase plan, buildings, structures, and other	111
improvements for any public purpose, and, in conjunction	112
therewith, to grant leases, easements, or licenses for lands under	113
the control of a state agency for a period not to exceed forty	114
years. The lease-purchase plan shall provide that at the end of	115
the lease period, the buildings, structures, and related	116
improvements, together with the land on which they are situated,	117
shall become the property of the state without cost.	118

(a) Whenever any building, structure, or other improvement is	119
to be so leased by a state agency, the department shall retain	120
either basic plans, specifications, bills of materials, and	121
estimates of cost with sufficient detail to afford bidders all	122
needed information or, alternatively, all of the following plans,	123
details, bills of materials, and specifications:	124

(i) Full and accurate plans suitable for the use of mechanics	125
and other builders in the improvement;	126

(ii) Details to scale and full sized, so drawn and	127
represented as to be easily understood;	128

(iii) Accurate bills showing the exact quantity of different	129
kinds of material necessary to the construction;	130

(iv) Definite and complete specifications of the work to be	131
performed, together with such directions as will enable a	132
competent mechanic or other builder to carry them out and afford	133
bidders all needed information;	134

(v) A full and accurate estimate of each item of expense and	135
of the aggregate cost thereof.	136

(b) The department shall give public notice, in such	137
newspaper, in such form, and with such phraseology as the director	138
of administrative services prescribes, published once each week	139
for four consecutive weeks, of the time when and place where bids	140
will be received for entering into an agreement to lease to a	141
state agency a building, structure, or other improvement. The last	142
publication shall be at least eight days preceding the day for	143
opening the bids. The bids shall contain the terms upon which the	144
builder would propose to lease the building, structure, or other	145
improvement to the state agency. The form of the bid approved by	146
the department shall be used, and a bid is invalid and shall not	147
be considered unless that form is used without change, alteration,	148
or addition. Before submitting bids pursuant to this section, any	149
builder shall comply with Chapter 153. of the Revised Code.	150

(c) On the day and at the place named for receiving bids for	151
entering into lease agreements with a state agency, the director	152
of administrative services shall open the bids and shall publicly	153
proceed immediately to tabulate the bids upon duplicate sheets. No	154
lease agreement shall be entered into until the bureau of workers'	155
compensation has certified that the person to be awarded the lease	156
agreement has complied with Chapter 4123. of the Revised Code,	157
until, if the builder submitting the lowest and best bid is a	158
foreign corporation, the secretary of state has certified that the	159
corporation is authorized to do business in this state, until, if	160
the builder submitting the lowest and best bid is a person	161
nonresident of this state, the person has filed with the secretary	162
of state a power of attorney designating the secretary of state as	163
its agent for the purpose of accepting service of summons in any	164
action brought under Chapter 4123. of the Revised Code, and until	165
the agreement is submitted to the attorney general and the	166
attorney general's approval is certified thereon. Within thirty	167
days after the day on which the bids are received, the department	168
shall investigate the bids received and shall determine that the	169
bureau and the secretary of state have made the certifications	170
required by this section of the builder who has submitted the	171
lowest and best bid. Within ten days of the completion of the	172
investigation of the bids, the department shall award the lease	173
agreement to the builder who has submitted the lowest and best bid	174
and who has been certified by the bureau and secretary of state as	175
required by this section. If bidding for the lease agreement has	176
been conducted upon the basis of basic plans, specifications,	177
bills of materials, and estimates of costs, upon the award to the	178
builder the department, or the builder with the approval of the	179
department, shall appoint an architect or engineer licensed in	180
this state to prepare such further detailed plans, specifications,	181
and bills of materials as are required to construct the building,	182
structure, or improvement. The department shall adopt such rules	183
as are necessary to give effect to this section. The department	184
may reject any bid. Where there is reason to believe there is	185
collusion or combination among bidders, the bids of those	186
concerned therein shall be rejected.	187

(15) To acquire by purchase, gift, devise, or grant and to	188
transfer, lease, or otherwise dispose of all real property	189
required to assist in the development of a conversion facility as	190
defined in section 5709.30 of the Revised Code as that section	191
existed before its repeal by Amended Substitute House Bill 95 of	192
the 125th general assembly;	193

(16) To lease for a period not to exceed forty years,	194
notwithstanding any other division of this section, the	195
state-owned property located at 408-450 East Town Street,	196
Columbus, Ohio, formerly the state school for the deaf, to a	197
developer in accordance with this section. "Developer," as used in	198
this section, has the same meaning as in section 123.77 of the	199
Revised Code.	200

Such a lease shall be for the purpose of development of the	201
land for use by senior citizens by constructing, altering,	202
renovating, repairing, expanding, and improving the site as it	203
existed on June 25, 1982. A developer desiring to lease the land	204
shall prepare for submission to the department a plan for	205
development. Plans shall include provisions for roads, sewers,	206
water lines, waste disposal, water supply, and similar matters to	207
meet the requirements of state and local laws. The plans shall	208
also include provision for protection of the property by insurance	209
or otherwise, and plans for financing the development, and shall	210
set forth details of the developer's financial responsibility.	211

The department may employ, as employees or consultants,	212
persons needed to assist in reviewing the development plans. Those	213
persons may include attorneys, financial experts, engineers, and	214
other necessary experts. The department shall review the	215
development plans and may enter into a lease if it finds all of	216
the following:	217

(a) The best interests of the state will be promoted by	218
entering into a lease with the developer;	219

(b) The development plans are satisfactory;

220

(c) The developer has established the developer's financial	221
responsibility and satisfactory plans for financing the	222
development.	223

The lease shall contain a provision that construction or	224
renovation of the buildings, roads, structures, and other	225
necessary facilities shall begin within one year after the date of	226
the lease and shall proceed according to a schedule agreed to	227
between the department and the developer or the lease will be	228
terminated. The lease shall contain such conditions and	229
stipulations as the director considers necessary to preserve the	230
best interest of the state. Moneys received by the state pursuant	231
to this lease shall be paid into the general revenue fund. The	232
lease shall provide that at the end of the lease period the	233
buildings, structures, and related improvements shall become the	234
property of the state without cost.	235

(17) To lease to any person any tract of land owned by the	236
state and under the control of the department, or any part of such	237
a tract, for the purpose of drilling for or the pooling of oil or	238
gas. Such a lease shall be granted for a period not exceeding	239
forty years, with the full power to contract for, determine the	240
conditions governing, and specify the amount the state shall	241
receive for the purposes specified in the lease, and shall be	242
prepared as in other cases.	243

(18) To manage the use of space owned and controlled by the	244
department, including space in property under the jurisdiction of	245
the Ohio building authority, by doing all of the following:	246

(a) Biennially implementing, by state agency location, a	247
census of agency employees assigned space;	248

(b) Periodically in the discretion of the director of	249
administrative services:	250

(i) Requiring each state agency to categorize the use of	251
space allotted to the agency between office space, common areas,	252
storage space, and other uses, and to report its findings to the	253
department;	254

(ii) Creating and updating a master space utilization plan	255
for all space allotted to state agencies. The plan shall	256
incorporate space utilization metrics.	257

(iii) Conducting a cost-benefit analysis to determine the	258
effectiveness of state-owned buildings;	259

(iv) Assessing the alternatives associated with consolidating	260
the commercial leases for buildings located in Columbus.	261

(c) Commissioning a comprehensive space utilization and	262
capacity study in order to determine the feasibility of	263
consolidating existing commercially leased space used by state	264
agencies into a new state-owned facility.	265

(B) This section and section 125.02 of the Revised Code shall	266
not interfere with any of the following:	267

(1) The power of the adjutant general to purchase military	268
supplies, or with the custody of the adjutant general of property	269
leased, purchased, or constructed by the state and used for	270
military purposes, or with the functions of the adjutant general	271
as director of state armories;	272

(2) The power of the director of transportation in acquiring	273
rights-of-way for the state highway system, or the leasing of	274
lands for division or resident district offices, or the leasing of	275
lands or buildings required in the maintenance operations of the	276
department of transportation, or the purchase of real property for	277
garage sites or division or resident district offices, or in	278
preparing plans and specifications for and constructing such	279
buildings as the director may require in the administration of the	280
department;	281

(3) The power of the director of public safety and the	282
registrar of motor vehicles to purchase or lease real property and	283
buildings to be used solely as locations to which a deputy	284
registrar is assigned pursuant to division (B) of section 4507.011	285
of the Revised Code and from which the deputy registrar is to	286
conduct the deputy registrar's business, the power of the director	287
of public safety to purchase or lease real property and buildings	288
to be used as locations for division or district offices as	289
required in the maintenance of operations of the department of	290
public safety, and the power of the superintendent of the state	291
highway patrol in the purchase or leasing of real property and	292
buildings needed by the patrol, to negotiate the sale of real	293
property owned by the patrol, to rent or lease real property owned	294
or leased by the patrol, and to make or cause to be made repairs	295
to all property owned or under the control of the patrol;	296

(4) The power of the division of liquor control in the	297
leasing or purchasing of retail outlets and warehouse facilities	298
for the use of the division;	299

(5) The power of the director of development to enter into	300
leases of real property, buildings, and office space to be used	301
solely as locations for the state's foreign offices to carry out	302
the purposes of section 122.05 of the Revised Code;	303

(6) The power of the director of environmental protection to	304
enter into environmental covenants, to grant and accept easements,	305
or to sell property pursuant to division (G) of section 3745.01 of	306
the Revised Code.	307

(C) Purchases for, and the custody and repair of, buildings	308
under the management and control of the capitol square review and	309
advisory board, the rehabilitation services commission, the bureau	310
of workers' compensation, or the departments of public safety, job	311
and family services, mental health, developmental disabilities,	312
and rehabilitation and correction, and buildings of educational	313
and benevolent institutions under the management and control of	314
boards of trustees, are not subject to the control and	315
jurisdiction of the department of administrative services.	316

(D) Any instrument by which real property is acquired	317
pursuant to this section shall identify the agency of the state	318
that has the use and benefit of the real property as specified in	319
section 5301.012 of the Revised Code.	320

Sec. 131.50.  (A) There is hereby created in the state	321
treasury the state land royalty fund consisting of money credited	322
to it under section 1509.73 of the Revised Code. Any investment	323
proceeds earned on money in the fund shall be credited to the fund	324
and used as required in division (B) of this section.	325

(B) Money in the state land royalty fund shall be used by	326
state agencies to acquire land and to pay capital costs of state	327
agencies, including equipment and renovations and repairs of	328
facilities, that have contributed to the fund under section	329
1509.73 of the Revised Code. Such a state agency is entitled to	330
receive from the fund the amount that the state agency contributed	331
and a share of the investment earnings of the fund in an amount	332
that is equivalent to the proportionate share of contributions	333
made by the state agency to the fund.	334

(C) Money in the fund shall be disbursed by the director of	335
budget and management with the approval of the controlling board.	336

(D) As used in this section, "state agency" has the same	337
meaning as in section 1509.70 of the Revised Code.	338

Sec. 1503.012. There is hereby created the forestry mineral	339
royalties fund, which shall be in the custody of the treasurer of	340
state and shall not be a part of the state treasury. The fund	341
shall consist of money deposited into it under section 1509.73 of	342
the Revised Code. Any investment proceeds earned on money in the	343
fund shall be credited to the fund.	344

Money in the fund shall be used by the division of forestry	345
to acquire land and to pay capital costs, including equipment and	346
repairs and renovations of facilities, that are owned by the state	347
and administered by the division. Expenditures from the fund shall	348
be approved by the director of natural resources.	349

Sec. 1509.70. As used in sections 1509.70 to 1509.77 of the	350
Revised Code:	351

(A) "Class 1 property" means property owned or controlled by	352
a state agency concerning which there are no encumbrances or deed	353
restrictions that limit the exploration or drilling for oil or gas	354
on the property.	355

(B) "Class 2 property" means property that is owned or	356
controlled by a state university or college or that is owned or	357
controlled by another state agency concerning which there is a	358
federal encumbrance or monetary interest that limits or prohibits	359
the exploration or drilling for oil or gas on the property.	360

(C) "Class 3 property" means property owned or controlled by	361
a state agency to which all of the following apply:	362

(1) The property is not a class 2 or class 4 property.

363

(2) The property is of insufficient size or shape to meet the	364
requirements for drilling a well on the property established under	365
section 1509.24 or 1509.25 of the Revised Code.	366

(3) The property is necessary for pooling with other parcels	367
of property for the purpose of forming a drilling unit in order to	368
meet the requirements for drilling a well established under	369
section 1509.24 or 1509.25 of the Revised Code.	370

(D) "Class 4 property" means property owned or controlled by	371
a state agency concerning which there is a provision in the deed	372
that limits the exploration or drilling for oil or gas on the	373
property.	374

(E) "Formation" means any of the following:

375

(1) The distance from the surface of the land to the top of	376
the Onondaga limestone;	377

(2) The distance from the top of the Onondaga limestone to	378
the bottom of the Queenston formation;	379

(3) The distance from the bottom of the Queenston formation	380
to the top of the Trenton limestone;	381

(4) The distance from the top of the Trenton limestone to the	382
top of the Knox formation;	383

(5) The distance from the top of the Knox formation to the	384
basement rock.	385

(F) "State agency" means both of the following:

386

(1) "State agency" as defined in section 1.60 of the Revised	387
Code;	388

(2) "State university or college" as defined in section	389
3345.12 of the Revised Code.	390

Sec. 1509.71. (A) It is the policy of the state to provide	391
access to and support the exploration for, development of, and	392
production of oil and natural gas resources owned or controlled by	393
the state in an effort to use the state's natural resources	394
responsibly.	395

(B) There is hereby created the oil and gas leasing	396
commission consisting of the chief of the division of geological	397
survey and the following four members appointed by the governor:	398

(1) Two members from a list of not less than four persons	399
recommended by a statewide organization representing the oil and	400
gas industry;	401

(2) One member of the public with expertise in finance or	402
real estate;	403

(3) One member representing a statewide environmental or	404
conservation organization.	405

(C) Initial appointments shall be made to the commission not	406
later than thirty days after the effective date of this section.	407
Of the initial members appointed to the commission, one shall	408
serve a term of two years, one shall serve a term of three years,	409
one shall serve a term of four years, and one shall serve a term	410
of five years. Thereafter, terms of office of members shall be for	411
five years from the date of appointment. Each member appointed by	412
the governor shall hold office from the date of appointment until	413
the end of the term for which the member was appointed. The	414
governor shall fill a vacancy occurring on the commission by	415
appointing a member within sixty days after the vacancy occurs. A	416
member appointed to fill a vacancy occurring prior to the	417
expiration of the term for which the member's predecessor was	418
appointed shall hold office for the remainder of that term. A	419
member shall continue in office subsequent to the expiration date	420
of the member's term until the member's successor takes office, or	421
until a period of sixty days has elapsed, whichever occurs first.	422

(D) Three members constitute a quorum of the commission, and	423
no action of the commission is valid unless it has the concurrence	424
of at least three members. The commission shall keep a record of	425
its proceedings. The chief of the division of geological survey	426
shall serve as the chairperson of the commission.	427

(E) The governor may remove an appointed member from the	428
commission for inefficiency, malfeasance, misfeasance, or	429
nonfeasance.	430

(F) Members of the commission shall receive no compensation,	431
but shall be reimbursed for their actual and necessary expenses	432
incurred in the course of the performance of their duties as	433
members of the commission.	434

(G) The department of natural resources shall furnish	435
clerical, technical, legal, and other services required by the	436
commission in the performance of its duties.	437

Sec. 1509.72.  (A) A state agency shall submit to the oil and	438
gas leasing commission an inventory of each parcel of land that is	439
owned or controlled by the agency. The inventory shall classify	440
each parcel as a class 1, class 2, class 3, or class 4 property.	441
The commission may request a state agency to submit documentation	442
supporting the classification of each parcel of land.	443

(B) Not later than ninety days after the acquisition of a	444
parcel of state land occurring after the effective date of this	445
section, the state agency that owns or controls the parcel shall	446
classify the parcel in the same manner that parcels are classified	447
under division (A) of this section.	448

(C) The department of natural resources shall post on the	449
department's web site a listing of each parcel of state land and	450
the classification assigned to the parcel under this section. The	451
commission shall provide to the department the information	452
necessary for the department to comply with this division.	453

Sec. 1509.73. (A)(1) Beginning on the effective date of this	454
section and ending on the effective date of the rules adopted	455
under section 1509.74 of the Revised Code, a state agency, in	456
consultation with the oil and gas leasing commission, may lease a	457
formation within a parcel of land that is owned or controlled by	458
the state agency for the exploration for and development and	459
production of oil or natural gas. The state agency shall establish	460
bid fees, signing fees, rentals, and at least a one-eighth	461
landowner royalty. On and after the effective date of the rules	462
adopted under section 1509.74 of the Revised Code, a formation	463
within a parcel of land that is owned or controlled by a state	464
agency may be leased for the exploration for and development and	465
production of oil or natural gas only in accordance with divisions	466
(A)(2) to (H) of this section and those rules.	467

(2) Not earlier than two hundred seventy days after the	468
effective date of this section, a person that is an owner and that	469
is interested in leasing a formation within a parcel of land that	470
is owned or controlled by a state agency for the exploration for	471
and the development and production of oil or natural gas may	472
submit to the oil and gas leasing commission a nomination that	473
identifies the parcel of land. A person submitting a nomination	474
shall submit it in the manner and form established in rules	475
adopted under section 1509.74 of the Revised Code and shall	476
include with the nomination both of the following:	477

(a) The information required by those rules;

478

(b) The nomination fee established in those rules.

479

(B)(1) In the calendar quarter following the receipt of a	480
nomination of a parcel of land, the commission shall conduct a	481
meeting for the purpose of determining whether to enter into a	482
lease for a formation within the parcel of land that is identified	483
in the nomination. The commission also shall review the nomination	484
of the parcel of land and determine if the parcel of land has been	485
classified under section 1509.72 of the Revised Code. If the	486
parcel of land that is the subject of the nomination has not been	487
classified, the commission immediately shall send a copy of the	488
nomination to the state agency that owns or controls the parcel	489
that is the subject of the nomination. Not later than fifteen days	490
after receipt of a copy of the nomination, the state agency shall	491
classify the parcel of land as a class 1, class 2, class 3, or	492
class 4 property and submit the classification to the commission.	493
On receipt of the state agency's classification of the parcel of	494
land, the commission shall provide the department of natural	495
resources the information necessary for the department to comply	496
with division (C) of section 1509.72 of the Revised Code.	497

After a parcel of land that is the subject of a nomination	498
has been classified under section 1509.72 of the Revised Code or	499
division (B)(1) of this section, as applicable, the commission	500
shall approve or disapprove the nomination. In making its decision	501
to approve or disapprove the nomination of the parcel of land, the	502
commission shall consider all of the following:	503

(a) The economic benefits, including the potential income	504
from an oil or natural gas operation, that would result if the	505
lease of a formation that is the subject of the nomination were	506
approved;	507

(b) Whether the proposed oil or gas operation is compatible	508
with the current uses of the parcel of land that is the subject of	509
the nomination;	510

(c) The environmental impact that would result if the lease	511
of a formation that is the subject of the nomination were	512
approved;	513

(d) Any potential adverse geological impact that would result	514
if the lease of a formation that is the subject of the nomination	515
were approved;	516

(e) Any potential impact to visitors or users of a parcel of	517
land that is the subject of the nomination;	518

(f) Any potential impact to the operations or equipment of a	519
state agency that is a state university or college if the lease of	520
a formation within a parcel of land owned or controlled by the	521
university or college that is the subject of the nomination were	522
executed;	523

(g) Any objections to the nomination submitted to the	524
commission by the state agency that owns or controls the land on	525
which the proposed oil or natural gas operation would take place;	526

(h) Any other factors that the commission establishes in	527
rules adopted under section 1509.74 of the Revised Code.	528

(2) The commission shall deny a nomination of a parcel of	529
land that is a class 3 property. The commission shall send notice	530
of the denial by certified mail to the person that submitted the	531
nomination.	532

(3) Prior to making its decision to approve or disapprove a	533
nomination, the commission shall notify the state agency that owns	534
or controls the land on which the oil or gas operation would take	535
place.	536

(4) The commission shall approve or deny a nomination not	537
later than two calendar quarters following the receipt of the	538
nomination. Notice of the decision of the commission shall be sent	539
by certified mail to the person that submitted the nomination.	540

(5) If the commission approves a nomination, the commission	541
shall notify the state agency that owns or controls the parcel of	542
land that is the subject of a nomination of the commission's	543
approval of the nomination. The notification shall request the	544
state agency to submit to the commission special terms and	545
conditions that will apply to the lease of a formation within the	546
parcel of land because of specific conditions related to the	547
parcel of land. The state agency shall submit the special terms	548
and conditions not later than sixty days after receipt of a notice	549
from the commission.	550

(6) If the commission approves a nomination for a parcel of	551
land that is a class 1 property, the commission shall offer for	552
lease each formation that is within the parcel of land. If the	553
commission approves a nomination for a parcel of land that is a	554
class 2 or class 4 property, the commission shall not offer for	555
lease any formation that is within the parcel of land unless the	556
state agency that owns or controls the parcel of land notifies the	557
commission that a formation or formations that are within the	558
parcel of land may be offered for lease.	559

(C) Each calendar quarter, the commission shall proceed to	560
advertise for bids for a lease for a formation within a parcel of	561
land that was the subject of a nomination approved during the	562
previous calendar quarter that is a class 1 property or that is a	563
class 2 or class 4 property for which the commission has received	564
notice from the state agency that owns or controls the parcel of	565
land under division (B)(6) of this section that a formation or	566
formations that are within the parcel of land may be offered for	567
lease. The advertisement shall be provided to the department of	568
natural resources, and the department shall publish the	569
advertisement on its web site for a period of time established by	570
the commission. The advertisement shall include all of the	571
following:	572

(1) The procedure for the submission of a bid to enter into a	573
lease for a formation within a parcel of land;	574

(2) A statement that a standard lease form that is consistent	575
with the practices of the oil and natural gas industries will be	576
used for the lease of a formation within the parcel of land;	577

(3) A copy of the standard lease form that will be used for	578
the lease of a formation within the parcel of land;	579

(4) Special terms and conditions, if applicable, that apply	580
to the lease because of specific conditions related to the parcel	581
of land;	582

(5) The amount of the bid fee that is required to be	583
submitted with a bid;	584

(6) Any other information that the commission considers	585
pertinent to the advertisement for bids.	586

(D) A person submitting a bid to enter into a lease under	587
this section shall pay a bid fee established in rules adopted	588
under section 1509.74 of the Revised Code.	589

(E) In order to encourage the submission of bids and the	590
responsible and reasonable development of the state's natural	591
resources, the information that is contained in a bid submitted to	592
the commission under this section shall be confidential and shall	593
not be disclosed before a person is selected under division (F) of	594
this section unless the commission determines otherwise.	595

(F) The commission shall establish a deadline for the	596
submission of bids for each lease regarding a particular parcel of	597
land and shall notify the department of the deadline. The	598
department shall post the deadline for the submission of bids for	599
each lease on the department's web site. A person shall submit a	600
bid in accordance with the procedures and requirements established	601
by the commission in rules adopted under section 1509.74 of the	602
Revised Code.	603

The commission shall select the person who submits the	604
highest and best bid for each formation within that parcel of	605
land, taking into account the financial responsibility of the	606
prospective lessee and the ability of the prospective lessee to	607
perform its obligations under the lease. After the commission	608
selects a person, the commission shall notify the applicable state	609
agency and send the person's bid to the agency. The state agency	610
shall enter into a lease with the person selected by the	611
commission.	612

(G)(1) Except as otherwise provided in division (G)(2) of	613
this section, all money received by a state agency from signing	614
fees, rentals, and royalty payments for leases entered into under	615
this section shall be paid by the state agency into the state	616
treasury to the credit of the state land royalty fund created in	617
section 131.50 of the Revised Code.	618

(2) Money received by a state agency from signing fees,	619
rentals, and royalty payments for leases entered into under this	620
section on land owned or controlled by the division of forestry,	621
wildlife, or parks and recreation in the department of natural	622
resources shall be deposited into one of the following funds, as	623
applicable:	624

(a) The forestry mineral royalties fund created in section	625
1503.012 of the Revised Code if the lease pertains to land owned	626
or controlled by the division of forestry;	627

(b) The wildlife habitat fund created in section 1531.33 of	628
the Revised Code if the lease pertains to land owned or controlled	629
by the division of wildlife;	630

(c) The parks mineral royalties fund created in section	631
1541.26 of the Revised Code if the lease pertains to land owned or	632
controlled by the division of parks and recreation.	633

(H) All money received from nomination fees and bid fees	634
shall be paid into the state treasury to the credit of the oil and	635
gas leasing commission administration fund created in section	636
1509.75 of the Revised Code.	637

(I) Notwithstanding any other provision of this section to	638
the contrary, a nature preserve as defined in section 1517.01 of	639
the Revised Code that is owned or controlled by a state agency	640
shall not be nominated or leased under this section for the	641
purpose of exploring for and developing and producing oil and	642
natural gas resources.	643

Sec. 1509.74. Not later than two hundred seventy days after	644
the effective date of this section, the oil and gas leasing	645
commission shall adopt rules in accordance with Chapter 119. of	646
the Revised Code establishing all of the following:	647

(A) The form of and the information to be included in	648
nominations that are submitted under section 1509.73 of the	649
Revised Code;	650

(B) Procedures for the submission of nominations to the	651
commission and the amount of nomination fees to be charged. The	652
rules shall require that if a person who has paid a nomination fee	653
does not enter into a lease regarding the parcel of land that the	654
person nominated, the fee shall be refunded to the person, and, if	655
applicable, the person that enters into the lease shall pay the	656
nomination fee. In addition, the rules shall provide that a state	657
agency is exempt from nomination fees and that a person who enters	658
into a lease regarding a parcel of land nominated by a state	659
agency shall pay the nomination fee.	660

(C) Factors that the commission may consider when determining	661
whether to approve or disapprove a nomination submitted under	662
section 1509.73 of the Revised Code;	663

(D) Procedures and requirements for the submission of bids	664
for a lease under section 1509.73 of the Revised Code;	665

(E) The amount of bid fees to be charged for the submission	666
of bids to enter into leases under section 1509.73 of the Revised	667
Code;	668

(F) A standard lease form that is consistent with the	669
practices of the oil and natural gas industries and that contains	670
at least a one-eighth landowner royalty, which standard lease form	671
shall be used by a state agency for leases entered into under	672
section 1509.73 of the Revised Code;	673

(G) Any other procedures and requirements that the commission	674
determines necessary to implement sections 1509.70 to 1509.77 of	675
the Revised Code.	676

Sec. 1509.75.  There is hereby created in the state treasury	677
the oil and gas leasing commission administration fund consisting	678
of the proceeds of nomination fees and bid fees credited to it	679
under section 1509.73 of the Revised Code. Money in the fund shall	680
be used by the oil and gas leasing commission and the department	681
of natural resources to pay the administrative expenses of the	682
commission and the department regarding the implementation of	683
sections 1509.70 to 1509.77 of the Revised Code. Money in the fund	684
also shall be used to pay the actual and necessary expenses	685
incurred by members of the commission in the course of the	686
performance of their duties.	687

Sec. 1509.76. A state agency that has classified a parcel of	688
land as a class 2 property under section 1509.72 or 1509.73 of the	689
Revised Code shall make reasonable efforts to take appropriate	690
actions so that the parcel of land may be reclassified as a class	691
1 property.	692

Sec. 1509.77. A state agency that owns or controls a parcel	693
of land that is a class 3 property for which a nomination for that	694
land has been denied under section 1509.73 of the Revised Code may	695
enter into written agreements with owners of adjoining tracts to	696
use that parcel of land to form a drilling unit that conforms to	697
the minimum acreage and distance requirements established under	698
section 1509.24 or 1509.25 of the Revised Code.	699

Sec. 1531.06.  (A) The chief of the division of wildlife,	700
with the approval of the director of natural resources, may	701
acquire by gift, lease, purchase, or otherwise lands or surface	702
rights upon lands and waters or surface rights upon waters for	703
wild animals, fish or game management, preservation, propagation,	704
and protection, outdoor and nature activities, public fishing and	705
hunting grounds, and flora and fauna preservation. The chief, with	706
the approval of the director, may receive by grant, devise,	707
bequest, donation, or assignment evidences of indebtedness, the	708
proceeds of which are to be used for the purchase of such lands or	709
surface rights upon lands and waters or surface rights upon	710
waters.	711

(B)(1) The chief shall adopt rules for the protection of	712
state-owned or leased lands and waters and property under the	713
control of the division of wildlife against wrongful use or	714
occupancy that will ensure the carrying out of the intent of this	715
section, protect those lands, waters, and property from	716
depredations, and preserve them from molestation, spoilation,	717
destruction, or any improper use or occupancy thereof, including	718
rules with respect to recreational activities and for the	719
government and use of such lands, waters, and property.	720

(2) The chief may adopt rules benefiting wild animals, fish	721
or game management, preservation, propagation, and protection,	722
outdoor and nature activities, public fishing and hunting grounds,	723
and flora and fauna preservation, and regulating the taking and	724
possession of wild animals on any lands or waters owned or leased	725
or under the division's supervision and control and, for a	726
specified period of years, may prohibit or recall the taking and	727
possession of any wild animal on any portion of such lands or	728
waters. The division clearly shall define and mark the boundaries	729
of the lands and waters owned or leased or under its supervision	730
and control upon which the taking of any wild animal is	731
prohibited.	732

(C) The chief, with the approval of the director, may acquire	733
by gift, lease, or purchase land for the purpose of establishing	734
state fish hatcheries and game farms and may erect on it buildings	735
or structures that are necessary.	736

The title to or lease of such lands and waters shall be taken	737
by the chief in the name of the state. The lease or purchase price	738
of all such lands and waters may be paid from hunting and trapping	739
and fishing licenses and any other funds.	740

(D) To provide more public recreation, stream and lake	741
agreements for public fishing only may be obtained under rules	742
adopted by the chief.	743

(E) The chief, with the approval of the director, may	744
establish user fees for the use of special public facilities or	745
participation in special activities on lands and waters	746
administered by the division. The special facilities and	747
activities may include hunting or fishing on special designated	748
public lands and waters intensively managed or stocked with	749
artificially propagated game birds or fish, field trial	750
facilities, wildlife nature centers, firearm ranges, boat mooring	751
facilities, camping sites, and other similar special facilities	752
and activities. The chief shall determine whether the user fees	753
are refundable and shall ensure that that information is provided	754
at the time the user fees are paid.	755

(F) The chief, with the approval of the director, may enter	756
into lease agreements for rental of concessions or other special	757
projects situated on state-owned or leased lands or waters or	758
other property under the division's control. The chief shall set	759
and collect the fees for concession rentals or other special	760
projects; regulate through contracts between the division and	761
concessionaires the sale of tangible objects at concessions or	762
other special projects; and keep a record of all such fee payments	763
showing the amount received, from whom received, and for what	764
purpose the fee was collected.	765

(G) The chief may sell or donate conservation-related items	766
or items that promote wildlife conservation, including, but not	767
limited to, stamps, pins, badges, books, bulletins, maps,	768
publications, calendars, and any other educational article or	769
artifact pertaining to wild animals; sell confiscated or forfeited	770
items; and sell surplus structures and equipment, and timber or	771
crops from lands owned, administered, leased, or controlled by the	772
division. The chief, with the approval of the director, also may	773
engage in campaigns and special events that promote wildlife	774
conservation by selling or donating wildlife-related materials,	775
memberships, and other items of promotional value.	776

(H) The chief may sell, lease, or transfer minerals or	777
mineral rights, with the approval of the director, when the chief	778
and the director determine it to be in the best interest of the	779
state. Upon approval of the director, the chief may make, execute,	780
and deliver contracts, including leases, to mine, drill, or	781
excavate iron ore, stone, coal, petroleum, gas, salt, and other	782
minerals, other than oil or gas, upon and under lands owned by the	783
state and administered by the division to any person who complies	784
with the terms of such a contract. No such contract shall be valid	785
for more than fifty years from its effective date. Consideration	786
for minerals and mineral rights shall be by rental or royalty	787
basis as prescribed by the chief and payable as prescribed by	788
contract. Moneys collected under this division shall be paid into	789
the state treasury to the credit of the wildlife habitat fund	790
created in section 1531.33 of the Revised Code. Contracts entered	791
into under this division also may provide for consideration for	792
minerals or mineral rights in the form of acquisition of lands as	793
provided under divisions (A) and (C) of this section.	794

(I) All moneys received under divisions (E), (F), and (G) of	795
this section shall be paid into the state treasury to the credit	796
of a fund that shall be used for the purposes outlined in section	797
1533.15 of the Revised Code and for the management of other wild	798
animals for their ecological and nonconsumptive recreational value	799
or benefit.	800

(J) The chief, with the approval of the director, may barter	801
or sell wild animals to other states, state or federal agencies,	802
and conservation or zoological organizations. Moneys received from	803
the sale of wild animals shall be deposited into the wild animal	804
fund created in section 1531.34 of the Revised Code.	805

(K) The chief shall adopt rules establishing standards and	806
guidelines for the administration of contraceptive chemicals to	807
noncaptive wild animals. The rules may specify chemical delivery	808
methods and devices and monitoring requirements.	809

The chief shall establish criteria for the issuance of and	810
shall issue permits for the administration of contraceptive	811
chemicals to noncaptive wild animals. No person shall administer	812
contraceptive chemicals to noncaptive wild animals without a	813
permit issued by the chief.	814

(L) All fees set by the chief under this section shall be	815
approved by the wildlife council.	816

(M) Information contained in the wildlife diversity database	817
that is established pursuant to division (B)(2) of this section	818
and section 1531.25 of the Revised Code may be made available to	819
any individual or public or private agency for research,	820
educational, environmental, land management, or other similar	821
purposes that are not detrimental to the conservation of a species	822
or feature. Information regarding sensitive site locations of	823
species that are listed pursuant to section 1531.25 of the Revised	824
Code and of features that are included in the wildlife diversity	825
database is not subject to section 149.43 of the Revised Code if	826
the chief determines that the release of the information could be	827
detrimental to the conservation of a species or feature.	828

Sec. 1531.33.  The wildlife habitat fund is hereby created in	829
the state treasury. The fund shall consist of the investment	830
earnings of the wildlife habitat trust fund created in section	831
1531.32 of the Revised Code; gifts, donations, bequests, and other	832
moneys contributed to the division of wildlife for the purposes of	833
the fund; moneys collected under division (H) of section 1531.06	834
of the Revised Code; moneys deposited in the fund under division	835
(G)(2)(b) of section 1509.73 of the Revised Code; and moneys	836
received by the division pursuant to negotiated mitigation	837
settlements from persons who have adversely affected fish and	838
wildlife, or their habitats, over which the division has	839
jurisdiction under this chapter or Chapter 1533. of the Revised	840
Code other than fish and wildlife of the Ohio river or their	841
habitats.	842

The fund shall be used by the division to acquire and develop	843
lands for the preservation, propagation, and protection of wild	844
animals. All expenditures from the wildlife habitat fund shall be	845
approved by the director of natural resources. Quarterly each	846
fiscal year, the treasurer of state shall transfer the investment	847
earnings of the wildlife habitat trust fund to the wildlife	848
habitat fund.	849

Sec. 1541.26.  There is hereby created the parks mineral	850
royalties fund, which shall be in the custody of the treasurer of	851
state and shall not be a part of the state treasury. The fund	852
shall consist of money deposited into it under section 1509.73 of	853
the Revised Code. Any investment proceeds earned on money in the	854
fund shall be credited to the fund.	855

Money in the fund shall be used by the division of parks and	856
recreation to acquire land and to pay capital costs, including	857
equipment and repairs and renovations of facilities, that are	858
owned by the state and administered by the division. Expenditures	859
from the fund shall be approved by the director of natural	860
resources.	861

Sec. 3345.181. (A) The board of trustees of a state	862
university, by majority vote, may make, execute, and deliver	863
contracts or leases to mine minerals upon lands under the	864
supervision of suchthe board, to any person or public entity that	865
complies with the terms prescribed by the board. Such contracts or	866
leases shall not operate as a conveyance of the fee to any part of	867
the realty.	868

(B) A board, by majority vote, may make expenditures and may	869
enter into contracts with any person or public entity for the	870
purposes of investigating, exploring, prospecting, or drilling for	871
petroleum and gas and the constituent components and mineral	872
by-products thereof upon lands under the supervision of such	873
board, and for the purposes of extracting, producing, selling,	874
using, or transporting such petroleum, gas, components, and	875
byproducts.	876

(C) The board may use the proceeds derived from its actions	877
under division (A) or (B) of this section for the furthering of	878
any of the purposes of the university.	879

Section 2.  That existing sections 123.01, 1531.06, 1531.33,	880
and 3345.181 and sections 5119.40, 5120.12, and 5123.23 of the	881
Revised Code are hereby repealed.	882

Section 3.  A lease entered into under division (B) of	883
section 3345.181 or section 123.01, 1531.06, 5119.40, 5120.12, or	884
5123.23 of the Revised Code as those sections existed prior to	885
their amendment or repeal by this act shall remain in effect until	886
the term of the lease expires as provided in the lease.	887

Section 4. Section 123.01 of the Revised Code is presented in	888
this act as a composite of the section as amended by both Am. Sub.	889
H.B. 1 and Sub. S.B. 79 of the 128th General Assembly. The General	890
Assembly, applying the principle stated in division (B) of section	891
1.52 of the Revised Code that amendments are to be harmonized if	892
reasonably capable of simultaneous operation, finds that the	893
composite is the resulting version of the section in effect prior	894
to the effective date of the section as presented in this act.	895