COLUMBUS — Outrage over big-money bonuses paid to executives of companies bailed out with tax dollars has spilled over into the Ohio Statehouse, with one lawmaker planning to introduce a resolution voicing his disgust.

“I am upset with what they’ve done and how they’ve abused the taxpayers on this whole issue,” said Rep. Robert Hagan of Youngstown, D-60th. “Someone has to stand up ... and say this is wrong. They should give their bonuses back. And they should accept the fact that they ruined this company and ruined it to the point that now the taxpayers own 80 percent of it.”

Hagan announced plans Tuesday to offer a resolution condemning the American International Group, known by the acronym AIG, which received about $170 billion in federal bailout funding, then paid its executives $165 million in bonuses.

The situation has prompted outcries from President Barack Obama and members of the U.S. Congress, including U.S. Rep. Tim Ryan of Niles, who moved quickly this week to determine whether there were legal means to force the executives to return the bonus payments.

Hagan, whose district has a median household income of about $21,000, said he wants to send a clear message to Washington that sending public funds to companies that are, in turn, providing big-money bonuses to their executives will not be tolerated.

That includes Ohio firms that have secured federal bailout dollars.

“I think that there’s a possibility that there are Ohio people involved,” Hagan said. “ Hopefully, my resolution will send that clear warning that we will be looking, we will be watching and they better not abuse the taxpayers.”

Ryan, D-17th, co-sponsored legislation today— the Bailout Bonus Tax Bracket Act of 2009, introduced by Congressman Steve Israel—that would fully recover the $165 million dollars in taxpayer funds that AIG intends to pay out to executives in the form of bonuses.

Currently, the IRS withholds 25 percent from bonuses less than $1 million and 35 percent for bonuses more than $1 million. Rep. Israel’s proposal, would tax bonuses over $100,000 disbursed to employees of companies receiving TARP funds at 100 percent.

For example, if an AIG employee’s taxable income is $750,000 which includes the $150,000 AIG bonus received this year, that employee will pay the top marginal rate on $500,000 of personal income, and then the “Bonus Bailout” tax rate of 100% on the $150,000 TARP bonus.

“It boggles my mind how these executives can be so unaware of what the American people are going through. This new tax provision is a wakeup call that the days of arrogance and greed on Wall Street are coming to an end, and we will use any means necessary,” Ryan said.

BY:  MARC KOVAK

The lawmaker from Youngstown admitted he was embarrassed.

COLUMBUS — A Democratic state lawmaker who sponsored legislation last session to limit high-interest payday lending said Wednesday he was embarrassed that the storefront lenders continue to operate throughout Ohio.

“The process was supposed to be a significant change, to bring [the annual percentage rate charged down] to 28 percent,” said Rep. Bob Hagan of Youngstown, D-60th. He added, “I think we were hoodwinked by a lot of people.”

Hagan was one of the primary sponsors on a bipartisan bill that would have capped interest at about 36 percent, in line with what the federal government already has instituted on military borrowers.

Ultimately, a Republican-sponsored bill was passed by the legislature and signed by Gov. Ted Strickland that, among other provisions, capped the annual percentage rate charged on short-term loans at 28 percent.

“I think we were hoodwinked by a lot of people. There was a wink and a nod, and the Republicans said well we’ll do it, we’ll go down to 28 percent and cut Hagan and the rest of them right out. And, you know, Bill Batchelder and I were sponsors of it, and we found out that we were used a little bit.”

Lenders have skirted the new law by obtaining licenses under other two laws — the Small Loan Act and the Mortgage Loan Act.

A report released this week by the Housing Research and Advocacy Center, a Cleveland-based nonprofit, noted that more than 1,000 payday lenders are still in business in the state and charging annual percentage rates as high as 680 percent.

“They seem to have won on legal terms,” Hagan said. “But I think there will be some challenges, and all of us are working again together to try to bring it down to an honest 28 percent.”

He added, “It’s embarrassing, it’s wrong and the people of the state of Ohio have said as loud as they could that they didn’t want this type of payday lending industry to operate in the state of Ohio.”

Gov. Ted Strickland, Attorney General Richard Cordray and some lawmakers have already voiced support for new legislation dealing with the issue.

BY:  MARC KOVAK

A bill introduced by two Ohio House members from Mahoning County would make animal abuse by its custodian or caregiver a felony.

The proposed law change stems from an incident that occurred in Youngstown in October 2008, said state Reps. Ronald V. Gerberry of Austintown, D-59th, and Robert F. Hagan of Youngstown, D-60th, the bill’s sponsors.

Steve Croley, 38, of Lowellville, operated High Caliber K-9 on Coitsville-Hubbard Road in Youngstown, where seven dead and 12 starving dogs were found. He was convicted in January of four misdemeanor counts of animal cruelty and sentenced to four months in jail and a $1,000 fine.

Youngstown Mayor Jay Williams and city Prosecutor Jay Macejko had encouraged state legislators to elevate animal cruelty to a felony from a misdemeanor which is punishable by up to six months incarceration.. The crime is a felony in 45 other states.

“The abuse of someone’s pet is deplorable, and this bill will make each occurrence of abuse a fifth-degree felony,” Gerberry said. “This means for each incident, the court can assign a sentence of up to 12 months in jail.”

“This legislation embodies a measured approach to dealing with similar situations in the future,” Hagan added. “It will give local prosecutors the necessary tools to punish those inflicting cruel and unusual punishment on pets.”

STAFF REPORT

COLUMBUS — State Representatives Robert F. Hagan, D-Youngstown, and Ronald V. Gerberry, D-Austintown, on Friday announced the DeYor Performing Arts Center will receive $800,000 in state support for the Eleanor Beecher Flad Pavilion.

The Ohio Cultural Facilities Commission recently approved the reimbursement to the Youngstown Symphony Society for construction costs associated with the pavilion that opened in 2006.

“I am pleased the commission is supporting this wonderful venue,” Gerberry said. “State dollars for this construction project will allow the symphony society to focus on continuing to provide top quality programs.”

The money to fund the project and others around Ohio was appropriated by the Ohio General Assembly over the past two sessions.

“This is an important program for our quality of life in the Mahoning Valley,” said Hagan. “The symphony provides many hours of wonderful entertainment and enrichment to thousands of area families every year. I’m proud the state is supporting this wonderful institution and the beautiful pavilion they have built.”

The Ford Family Recital Hall and its adjacent Eleanor Beecher Flad Pavilion have a combined area of 24,000 square feet. The theater and pavilion were the final piece of an $11 million project that also included the earlier renovation of Powers Auditorium and construction of its East Wing.

COLUMBUS — Valley lawmakers will serve in leadership positions on seven of 32 Democrat-controlled legislative committees.

House Speaker Armond Budish, a Democrat from the Cleveland area, and Minority Leader Bill Batchelder, a Republican from Medina, announced the committee setup late Tuesday.

Among the committee assignments announced Tuesday:

UAs anticipated, Rep. Vernon Sykes, a Democrat from Akron, was named chairman of finance, the committee that will take up Gov. Ted Strickland’s budget proposal. Rep. Linda Bolon, a Democrat from Columbiana County, was named vice chairwoman of that committee.

URep. Mark Okey, a Democrat from the Carrollton area, was named chairman of the Civil and Commercial Law Committee.

URep. Sandra Stabile Harwood, a Democrat from Niles, was named chairwoman of the Judiciary Committee.

URep. Tom Letson, a Democrat from Warren, was named chairman of Ways and Means and vice chairman of the Insurance Committee.

URep. Ron Gerberry, a Democrat from the Austintown area, was named chairman of the State Government Committee.

URep. Bob Hagan, a Democrat from Youngstown, was named chairman of the Transportation and Infrastructure Committee.

YOUNGSTOWN — State Rep. Robert Hagan of Youngstown, D-60th, joined with state representatives from around the Midwest to call on Congress to invest more of the federal stimulus money into rail projects.

“Passenger rail service is an environmentally friendly transportation option and a permanent source of economic development that ties together cities and regions,” said Hagan, who works as a locomotive engineer. “I believe the expansion of this service will create permanent jobs in Ohio and will boost our struggling economy.”

Hagan serves as Gov. Ted Strickland’s appointment to the Midwest Interstate Passenger Rail Commission.

The Midwest Interstate Passenger Rail Commission is a 10-state interstate compact commission that promotes, coordinates and supports regional improvements to passenger rail service. Member states are Illinois, Indiana, Iowa, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio and Wisconsin.

“Gov. Strickland showed his commitment to improving rail in Ohio during his State of the State speech,” Hagan said. “With help from President Obama’s economic stimulus package, we can see the complete restoration of a rail corridor between Cleveland and Cincinnati.”

STAFF REPORT

By Alan Johnson and Catherine Candisky

Further dimming the possibility of easing the state's crowded prisons, a new report says that repairing and renovating the closed Lima Correctional Institution would cost the state $184 million. That price tag led a state panel to agree yesterday that it is not "economically feasible" to reopen the facility. Committee Chairman Terry Collins, director of the Ohio Department of Rehabilitation and Correction, said the Lima Correctional Institution Study Committee will meet again next week to complete its recommendations, which must be made to Gov. Ted Strickland and legislative leaders by April 1. Leaky roofs, buckling floors, dangerous asbestos and mold increased the potential renovation cost, according to a $50,000 study for the state by Heery International of Atlanta. Tearing down the old prison would cost $8.6 million.The study rolled out yesterday offered alternatives, including renovating three buildings on the Allen County site for about $9.1 million. The buildings could house about 600 low-security prisoners, Heery estimated.
The committee was created by the legislature after Gov. Bob Taft ordered the closing of the 1,565-bed minimum-security prison in 2003 to save $25 million annually. A lawsuit delayed the closing until the following year. The report left little doubt about what should be done with the Lima facility, said committee member Robert F. Hagan, a Democratic state representative from Youngstown. "The costs of opening it up are prohibitive," he said. "The money would be better
spent tearing it down." The Heery analysis offered comparative costs for new construction and alternatives for housing prisoners. Building a prison of comparable size would cost $229.7 million, while adding dormitories at existing prisons would cost $17.8 million. About 750 prisoners could be accommodated at community corrections facilities for about $2 million, the study concluded.

Lima's political, civic and business leaders have lobbied the state to reopen or
reuse the prison, citing an annual economic loss to the community of more than $25
million in payroll and other revenue. "We're obviously concerned about any community that has lost jobs," Hagan said, "But our charge is bigger than just Lima." Easing prison crowding is the overarching concern, Collins said. "We can't buy your way out of it, and you can't build your way out of it," he said. "We spent $800 million to build 23 or 24 facilities between 1987 and 2000, and today we sit at 130 percent of capacity." The state's prisons, designed for 38,320 inmates, hold 49,797, according to the prisons department. It estimates the prison population could grow by 14,000 by 2016.

The Heery study suggests that inmates sentenced to less than a year -- who often are nonviolent drug offenders -- be redirected to community-based facilities or programs, and that lawmakers give state prison officials authority to transfer "appropriate" offenders to local facilities. Studies have shown that prisoners served through community-based facilities are less likely to return to prison. Collins cautioned, however, that community-based facilities are packed, too. Hagan said lawmakers who introduce "tough-on-crime" bills mandating prison sentences for various crimes must start including funds to cover the added expense. 

Arguably the most interesting and organic example of bipartisanship in Columbus in recent years is the partnership between arch conservative Republican lawmaker William Batchelder, Medina, and arch liberal Democratic lawmaker Robert Hagan, Youngstown.

They are co-sponsors of House Bill 333, a genuine consumer protection package that would end the most predatory aspects of payday lending.

These guys aren’t just taking their show on the road — they have put their message over the airways with a radio ad and robocall, asking Ohioans to go to a Web site through which they can send a message to their elected representative urging them to support the anti-payday lending bill.

Leaky roofs, buckling floors, dangerous asbestos and mold may sound the death knell for any possibility of reopening the Lima Correctional Institution.

"Very negative," said a downcast Lima Mayor David Berger after hearing a preliminary consultant's report at yesterday's meeting of the Lima Correctional Institution Study Committee.

The committee, set up by the General Assembly to consider options for reopening or reusing the facility, heard from Rory Turner, project manager for Heery International Inc. The Atlanta firm has a $50,000 contract to assess the condition of the former prison and suggest renovation or replacement costs.

The 1,565-bed, minimum-security prison was ordered closed by then-Gov. Bob Taft in 2003 to save $25 million annually. A lawsuit delayed the closing until 2004.

Turner's structural assessment of the prison, complete with pictures, was bleak. He said there is a "lot of deterioration," including leaky roofs, saturated walls, crumbling plaster and cracked and buckling floors. There is mold and possibly asbestos in the prison, parts of which were built in 1915 for a mental asylum.

Cost estimates on repairs, renovation and demolition are due this week, Turner said. He pegged the value of the buildings and 85 acres at $4.8 million.

Heery is to complete its final report on Feb. 29. The study committee must submit its report to Gov. Ted Strickland and legislative leaders by April 1.

Turner said that even if the prison were in good condition, its antiquated layout "does not follow the contemporary designs for correctional institutions."

"From where I'm sitting, the costs are exorbitant," said state Rep. Robert F. Hagan, D-Youngstown, a committee member. "To me, this report is depressing."

Berger and other Lima officials who made the trek to Columbus for the hearing likewise came away depressed. They were hoping for a reuse plan to help plug the hole left by the loss of 500 jobs and $100 million in prison wages and spending.

Berger questioned the state's decision to shut off all utilities in 2005. He said that apparently caused a "very usable building" to decay. Turner said the damage probably would have happened anyway.

Lima officials said business uses for the site are impractical because it is bordered on two sides by other state correctional facilities.

Ohio prisons director Terry Collins, chairman of the committee, said three or four new prisons would be needed to tame the state's prison crowding problem. Ohio's 32-prison system is 33 percent over capacity.

Diverting short-term, nonviolent offenders out of the system, rather than building new prisons, is the solution, Collins said.

Money Raised by ProgressOhio Members for WVKO Goes to Air Ads

One of the most conservative members of the Ohio General Assembly and one of the most progressive members joined together this week to air a radio ad calling on passage of SB 333 which caps PayDay Lending interest rates.

ProgressOhio paid for the radio ads after members donated almost $1,000 in December to support the new progressive radio station WVKO.

“We donated $1,000 of our members’ donations to WVKO and thought a good use of these dollars would be a bi-partisan call for limiting the outrageous interest levels offered by PayDay lenders,” said Brian Rothenberg or ProgressOhio.org.

Rep. Batchelder and Rep. Hagan recorded the radio ad and a recorded phone script last Wednesday.

Ads will begin on WVKO on Tuesday February 5.

PAYDAY LENDING RADIO SCRIPT

Rep. Batchelder: Hello, I’m Republican State Representative Bill Batchelder

Rep. Hagan: And I’m Democratic State Representative Bobby Hagan

Rep. Batchelder: You know Bobby and I don’t always agree, but when it comes to limiting PayDay Lending we do.

Rep. Hagan: That’s right Bill. After all in Ohio the law allows yearly interest charges of 391%.

Rep. Batchelder: It’s a debt trap and over 300,000 Ohioans are trapped each year.

Rep. Hagan: Go to www.ohiodebttrap.org. That’s www.ohiodebtrap.org and follow the instructions on the screen to be connected to your state representative’s office. Tell them to support HB 333.

Rep. Batchelder: Tell them to end the “debt trap” and cap the interest charged by PayDay loan companies. And thanks for your help.