COLUMBUS—The Ohio House of Representatives today passed legislation that would give Ohio families more freedom and flexibility over their financial decisions.
If House Bill 229 is signed into law, Ohio would join 15 other states that allow the creation of family trust companies (FTC), entities that may provide a single family with fiduciary services like accounting, financial management and investment. Such a measure would make Ohio a more competitive option, since families that set up an FTC are not required to live in the state where it is based and currently leads to many families looking outside the state for these services.
“The creation of family trust companies will not only keep economic activity in Ohio but also allow families to manage their own wealth,” said Rep. Steve Hambley (R-Brunswick), a primary sponsor of the bill. “As 15 other states have similar legislation, this will keep Ohio competitive and a leader in trust business.”
HB 229 establishes two kinds of family trusts:
1. Unlicensed Family Trust Companies—very limited in scope, available only to descendants of a single ancestor and related trusts, charities and key employees of the FTC
2. Licensed Family Trust Companies—for families that prefer a FTC subject to the inspection of the Ohio Division of Financial Institutions; requires at least $200,000 in capital and must maintain a fidelity bond of at least $1 million
While 15 states already allow the creation of family trust companies, Ohio would be the first among the states bordering it to adopt this legislation. Among the intentions of House Bill 229 is to attract families from those bordering states to bring their business and investments into Ohio.
The legislation received five hearings in the House Financial Institutions, Housing and Urban Development Committee, where it passed with near unanimous support. It passed on the House floor today by a vote of 81-8. It now awaits consideration in the Ohio Senate.