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www.ohiorestaurant.org
Fall 2012 Issue
PUBLIC POLICY
The PUCO, Small Business and Economic Development
The case for an Ohio Office of Small Business Advocate
The Premise
According to the Small Business
Administration (SBA), small businesses
generated 65 percent of the new jobs
created in the past 17 years. And, of
course, we know that foodservice is Ohio’s
third-largest, private sector employer with
over one-half million employees. It is
in Ohio’s best interest to do everything
possible to help its small businesses grow,
including the restaurant industry.
The Problem
• The five-member Public Utilities
Commission of Ohio (PUCO) decides
rate requests from utilities. The
recent AEP rate case in central Ohio
demonstrated the significant impact
that electric rate hikes impose on small
businesses. One member of the Ohio
Restaurant Association with four 5,000
square feet locations would have seen
an increase of $12,000-15,000, per
location annually.
• This case also shined a public light on
the fact that the small business segment
of the commercial class of ratepayers is
effectively without representation before
the PUCO. It should be noted that
residential customers are represented by
the Ohio Consumers’ Counsel, and large
manufacturers have clearly demonstrated
that they have the financial resources to
pay for representation.
• It can cost between $10,000 and
$75,000 or more to engage skilled
consultants to carry a single case
through the rate approval process. This
makes it financially prohibitive for
any one industry segment to engage
in effective and sustained advocacy
before the PUCO.
• The problem is not one of leveling the
playing field. The problem is that the
current system of utility rate setting puts
in jeopardy the new job creation that
would otherwise be expected from tens
of thousands of small Ohio businesses.
The Solution
Small businesses, which include the
commercial class of utility customers,
must have a professional staff devoted
exclusively to analyzing rate filings and
advocating for the best interests of
commercial ratepayers.
The ORA researched other state models
and believes that the Pennsylvania
Office of Small Business Advocate is
worthy of consideration. It has been
in existence since 1988 and operates
on an annual budget of $1.3 million.
The ORA is working with State Senator
Chris Widener (R)-Springfield, who has
expressed an interest in helping find a
means to provide small business with a
voice before the PUCO.
as perfect examples of the entrepreneurial
spirit of Ohio’s restaurant scene. He
also noted that his office experienced a
growing number of inquiries from travelers
and “foodie” writers over the years about
the growing offerings Ohio boasts in
culinary fare.
He noted that in 2011 alone visitors to
the state of Ohio spent $26 billion in
Ohio, which generated more than $40
billion in sales. This created $2.7 billion
in tax revenues for the state. While Ohio
is regarded for its diverse scenic offerings
and world-renowned theme parks, Eylon
noted that his staff most often heard
people discussing Ohio’s diverse array
of culinary delights. Because of Ohio’s
broad ethnic populations – whether
in relation to the ethnic communities
with their niche fare in urban areas or
celebrated fruits like Southeast Ohio’s
Pawpaw, people visit the state to cross
things off their “culinary bucket list.”
People come here to relax, rejuvenate
and reconnect, he noted. One of the
ways they do this is through exploring the
state and its edible offerings.
“When you consider that Ohio is within a
day’s driving range of 60 percent of the
U.S. population, any uptick in tourism
promotion is going to result in a higher
volume of out-of-state visitors,” Eylon
said. This is important considering that
Ohio’s budget for regional promotion was
so small compared to the much higher,
sustained funding that SB 314 will create.
“More money invested in Ohio’s tourism
funding model will mean a much stronger
return on investment for Ohio’s restaurant
industry,” he added. “You can’t forget that
more than 25 percent of visitor’s spend
goes directly into food and beverage. The
more money you get to promote the state,
the greater all of Ohio’s tourism industry
will do, and food and beverage makes up
a huge portion of our industry.”
Eylon was also quick to point out that
TourismOhio’s website is a great way for
restaurant operators to highlight their
businesses. He noted that the website’s
section on food is one of the largest of all
the website’s offerings.
“People will always be sensitive to price
points when they travel, but one of the
great things about Ohio is that there is
such a diverse range of food for people
to enjoy,” Eylon said. “No matter what
craving people have, we have restaurants
that feed those urges. People will always
enjoy a meal if they encounter a feeling
of welcoming and being treated like a
regular. Luckily, here in Ohio, we have
food and beverage operators that don’t
know how else to treat their customers.”
The ORA continues to work closely with
TourismOhio and looks forward to the
sustained funding that SB 314 will mean
for all segments of the state’s tourism
industry, but particularly for Ohio’s
restaurants. It is through advocacy efforts
like those behind SB 314 that Ohio’s
foodservice industry remains strong and
looks toward a future full of travelers
seeking to cross food experiences off their
“culinary bucket lists.”
“We know that political advocacy is valued
by ORA members, and SB 314 is a
perfect example of how your membership
investment will result in more spending in
Ohio’s restaurants,” Hetrick added.
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