Pending Budget Reform Could Reshape Ohio’s Funding that Supports Real Estate

Ohio State Representative Mike Dovilla has introduced House Bill 645, a proposal that would fundamentally change how Ohio builds its Operating Budget by requiring state agencies to adopt zero-based budgeting once every ten years, beginning with the next biennium that begins on July 1, 2027. Rather than starting from prior biennial spending levels and adjusting for inflation or growth, agencies would be required to justify each program and expenditure. While newly introduced, the Bill appears to have early backing from House Speaker Matt Huffman and House Finance Chair Brian Stewart, signaling potential momentum.

If enacted, HB 645 would not directly eliminate or reduce funding for specific programs. Instead, it would introduce an entirely new framework for establishing, gauging, and updating economic development, infrastructure, and incentive programs that support commercial real estate. Every Ohio program would need to demonstrate continued relevance, effectiveness, and return on investment to maintain funding during each ten-year reset cycle. For the commercial real estate industry, this could likely lead to greater emphasis on measurable outcomes such as job creation, capital investment, and long-term tax base growth when state-supported tools are evaluated.

If this Bill becomes law, it will bring both opportunity and uncertainty. On one hand, zero-based budgeting could strengthen well-performing development programs by reinforcing their value to policymakers and taxpayers. On the other hand, it would undermine reliability, predictability, and certainty that the market craves when it comes to programs that are often relied upon for transactions and developments, especially those with long lead times. HB 645 unquestionably signals a broader shift toward performance-driven public finance that may increasingly influence whether and how state resources are deployed.