Ohio Department Of Development Updates QEP PILOT Construction Reporting Process

The Ohio Department of Development ("ODOD") has made some changes to documents provided by renewable energy projects that have received certification as a Qualified Energy Project ("QEP") in the Payment in Lieu of Taxes ("PILOT") program under R.C. 5727.75:

• Recently, ODOD established new informational requirements that a QEP must meet if the project provides an alternative document to prove that an employee is domiciled in Ohio, rather than one of the three types of acceptable documents ODOD has listed in its rules.
• In April 2025, ODOD also revised its Construction Completion Report form, which must be submitted to ODOD within 90 days after a QEP is placed in service.

Ohio-domicile verification documents: A QEP must maintain a ratio of Ohio-domiciled full-time equivalent ("FTE") employees employed in the construction or installation of a solar project to the total number of FTE employees of not less than 70%. Other renewable energy projects, such as wind projects, have a 50% domicile requirement.¹

A QEP must meet an Ohio-domicile workforce requirement and submit two forms of employee verification from each employee when the QEP submits its Construction Completion Report to ODOD. Specifically, pursuant to Ohio Administration Code 122:23-1-04(C), the following must be provided for each Ohio-domicile employee:

1. A completed employee Ohio-domicile declaration form (Employee Ohio Domicile Declaration Form);and
2. An additional document proving the employee is domiciled in Ohio, in the form of one of the followingacceptable documents:
   
   • Unexpired driver's license/identification card,
   • Ohio voter registration card, or
   • A recent utility bill showing Ohio address.

The rule also provides that ODOD may accept "other documentation" that the ODOD Director determines reasonably demonstrates that the employee is domicile in Ohio [See Ohio Administration Code 122:23-1-04(C)]. However, the new Employee Ohio Domicile Declaration Form recently issued by ODOD only allows for one of the three acceptable documents listed above. ODOD has explained that it does not provide blanket approval for any other form of documentation than the three listed above that are in the rule and on the form, but will consider other forms of documentation on a case-by-case basis as warranted.

Recently, ODOD adopted a new process with regard to whether it will accept "other documentation" as an alternative to the 3 stated acceptable documents described above. To consider any other form of documentation, ODOD now requires the following additional information be provided for each employee that uses other documentation with the Ohio-domicile verification documents submitted with the Construction Completion Report:

1. The number of employees who cannot meet the identified types of documentation to demonstrate permanent residence in the state of Ohio.
2. A detailed justification for each such employee as to why that specific employee is unable to provide one of the three identified document types.
3. The type of documentation that will be used to demonstrate that the employee's permanent residence is in the state of Ohio for each employee that cannot meet one of the three identified document types.

Bottom line: It is highly recommended that QEPs only provide 1 of the 3 acceptable documents listed in the rule and on the employee Ohio-domicile declaration form for the additional document verifying that an employee is Ohio-domiciled. If another form of documentation is provided that is not 1 of the 3 acceptable documents, that other documentation should only be used on a rare occasion, as ODOD will only consider other documentation on a case-by-case basis, and for each of those instances, ODOD will require that the additional information listed above be provided.

QEPs should work with their contractors early in the process to ensure that the contractors and subcontractors can provide 1 of the 3 three acceptable documents for each employee as proof of Ohio domicile or otherwise face enhanced reporting requirements that appear to invite additional risk for maintaining eligibility for the tax exemption.²

Construction Completion Report form: A QEP must submit its Construction Completion Report, along with all required attachments documenting compliance with the statute and rules, within 90 days after the project is placed in service.

This spring, ODOD revised its Construction Completion Report forms. ODOD now requires QEPs to use ODOD's "Excel workbook" for submissions of the report. Note also that the tab of the Excel workbook labeled Appendix D includes ODOD's domicile reporting spreadsheet, which QEPs are now required to use to track the time of FTE employees. ODOD periodically updates these forms on its website, so QEPs should regularly monitor the site for the latest version.

The individual updated forms and attachments to the Construction Completion Report, as of the date of publication, can be accessed at the following web links:

• Construction Completion Report
• Attachment B – Approvals Certification
• Attachment C – Fire & EmergencyResponderCertification
• Attachment D – Offer to Sell Power or Renewable Credits Certification
• Attachment E – Evidence of Established Relationship for Apprenticeship Program
• Attachment F – Certificate of County Engineer
• Attachment G – Employee Ohio Domicile Declaration Form

Footnotes

[1] FTE employee means: "the total number of employee-hours for which compensation was paid to individuals employed at a [QEP] for services performed at the project during the calendar year divided by [2,080] hours. For the purpose of this calculation, "performed at the project" includes only hours worked at the [QEP] and devoted to site preparation or protection, construction and installation, and the unloading and distribution of materials at the project site, but does not include hours worked by superintendents, owners, manufacturers' representatives, persons employed in a bona fide executive, management, supervisory, or administrative capacity, or persons whose sole employment on the project is transporting materials or persons to the project site. R.C. 5727.75(A)(4)

[2] ODOD has informally communicated that the forms it has placed on its website may be further revised in the Fall of 2025 when ODOD plans to launch a new Salesforce application portal.

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