The Ohio House Financial Institutions Committee conducted the first hearing on House Bill 278 on June 11, when sponsors and committee members discussed a package of modernization changes to statutes governing the Treasurer of State.

Representative Ty Matthews, sponsor of House Bill 278, told the committee the bill “represents the next step in Ohio treasurer's ongoing efforts to modernize the office and align outdated laws with how financial operations work today.” He said the package was written to reflect a move from paper-based processes to streamlined electronic systems.

The bill would update nearly 30 code provisions, the sponsors said, including changes to how state funds are deposited into the OAKS system, adjustments to investment statutes, and technical corrections intended to make statutory language match current practices. Matthews said pending amendments would also “simplify reporting the treasurer's CPN program to avoid duplication with the auditor state's responsibilities.”

Members of the committee asked several technical questions. Representative Ferguson asked about a Uniform Depository Act provision that “specifies that a financial institution must have a banking office in Ohio to serve as a public depository,” and said he wanted clarity to ensure the requirement is substantive rather than something that could be satisfied by a token physical presence. Representative Ferguson requested follow-up to confirm whether the intent is that depositories be domiciled in Ohio.

Representative Young questioned a collateral provision, asking, “Is the collateral portion, 10%?” Sponsors deferred technical thresholds to the Treasurer of State’s office; Matthews said those specifics would be provided when the treasurer’s staff testifies.

Committee members also sought clarification about custodial responsibilities. Representative Young asked how the bill would change the treasurer’s role as custodian for teachers’ retirement assets. In response, Matthews said the bill clarifies that certain dollars held by a depository “are not state treasurer funds. Those are the pension funds,” and that the statute would make clearer the separation between funds under the treasurer’s custodial responsibility and other state funds; he advised the committee to direct detailed custodian questions to the Treasurer’s office when it testifies.

Ranking Member Sandenberg said the updates appeared broadly sensible but emphasized the committee’s role in vetting the draft for unintended consequences, referencing prior modernization efforts that produced unforeseen results. Matthews and Representative Law, the bill’s joint sponsor, said the changes had been developed in consultation with other state agencies, including the auditor and the Office of Budget and Management, to reduce duplication and streamline processes.

A committee member raised a question about a provision that “authorizes the treasurer of the state to charge local treasurers an annual fee for education and training,” asking whether a cap exists and how the fee is determined. The sponsors did not have that detail immediately available and said they would follow up with the Treasurer’s office to provide the statutory specifics.

Procedural items at the start of the meeting included the appointment of Ranking Member Sandenberg as committee secretary; the committee recorded no opposition to that appointment. No committee votes were taken on House Bill 278 during the first hearing.

The sponsors and members indicated they expect technical questions and thresholds — for example, the collateral percentage and custodial arrangements for pension funds — to be addressed by the Treasurer of State’s office at a subsequent hearing. The committee concluded the first hearing with no formal action on the bill.