U.S. Sen. Jon Husted said the federal tax benefits of private equity firms may need to change after the parent company of a historic paper mill in Chillicothe broke a promise to stay open and announced plans to shut down this summer.
In an interview with Signal Ohio on Thursday, Husted didn’t elaborate on which aspects of the tax code he believes need reform or how they would affect private equity firms. But such firms and their owners benefit from a wide range of tax breaks, including the “carried interest” exemption, that allow fund managers to receive a lower tax rate on their fees.
Husted said that he’s seen many instances of private equity firms acquiring companies just to strip them of their valuable assets.
“I am a capitalist. I love markets and competition. But there are some businesses out there that just give business a bad name, and this is one of them,” Husted said. He also called the company’s owner “untrustworthy.”
“I would just warn every city where they’re invested not to do deals with them,” Husted said.
Last month, Pixelle Specialty Solutions — owned by private equity firm H.I.G. Capital — announced it would close its Chillicothe mill in August. Under pressure from state and federal officials, including Husted, the company had previously committed to remain open through the end of the year. But the company later reversed course.
Pixelle issued a statement for this story that said despite the “hundreds of millions of dollars” it had invested in the mill over the years, demand had declined for the products made there.
The facility specializes in making carbon-copy paper like the kind that used to be widely used for invoices.
“Although the original shutdown timing was paused in good faith, declines in staffing and customer demand made a further delay no longer possible,” the company said. ”We remain committed to supporting impacted employees and are actively working with JobsOhio and local, state, and federal officials to explore future opportunities for the site, including the potential for a new owner and/or eventual redevelopment.”
Husted fielded questions on Chillicothe and other topics during a mini-media tour shortly after he received an endorsement from the Ohio Chamber of Commerce in his election bid next year. The endorsement, which chamber leadership said was the first issued by the organization’s new federal political action committee, comes despite Husted not yet drawing a major challenger.
It also came the same week that Husted filed a campaign finance report that showed he has $2.65 million in campaign cash after raising $2 million and spending $293,000 between April and June.
Gov. Mike DeWine appointed Husted to the seat in January to complete Vice President JD Vance’s term.
Husted called the endorsement an “honor” and said he took it as validation that he understands Ohio and the issues facing its businesses.
“They know I’m just solid and trusted and have a great track record of leading and serving,” Husted said.
Here are some other topics Husted addressed:
The deficit and the Big Beautiful Bill
Husted has talked about reducing the massive federal deficit since joining the Senate. But he joined his Republican colleagues in voting for Big Beautiful Bill, President Donald Trump’s signature legislation that increases the deficit and contains a sprawling mix of tax cuts and reductions in Medicaid and other social-safety net programs.
Husted previously has expressed discomfort with his vote last month, given its lack of deficit reduction. Congressional budget scorers and analysts have estimated it will add between $3.3 trillion and $6 trillion to the federal deficit by 2034, a point Democrats are trying to use against Republicans seeking re-election next year.
Asked about the bill’s impact on the deficit, Husted cited a more recent estimate from congressional budget scorers that said it reduced the federal deficit by $400 billion. The difference largely has to do with how you account for the 2017 tax cuts Trump previously signed into law that the new bill makes permanent.
“That bill only got better for me. … And I think it will grow the economy more than the [Congressional Budget Office] is giving it credit for,” Husted said.
Husted said Republicans and Democrats eventually will have to come together to address the deficit.
In the meantime, he said, he thinks the bill will be good politics. Besides the extension of the old Trump-passed tax cuts, highlights in the bill include $1,000, government-funded “Trump accounts” for newborn babies and an expansion of an existing tax exemption for daycare costs.
Democrats have focused on how the bill extends tax cuts, including for corporations, while expanding the deficit and cutting Medicaid and other social services.
“It’s pro-family, it’s pro-small business, and the failure to do it would have led to a $4 trillion tax increase,” Husted said.
Husted backs Governor DeWine’s view on data center tax breaks
Husted and other state officials have long been big proponents of giving tax breaks to data centers, which build large facilities that have massive electricity demands and few employees.
But Republican state lawmakers tried to revoke the state’s share of those tax breaks in their new budget bill to help pay for new taxes for Ohio’s top one-fifth of earners.
DeWine vetoed the change to data centers when he signed the budget bill earlier this month.
Asked about the move, Husted seemed to agree with his former boss. He said ending the tax break for future projects wouldn’t create a “fair playing field” since existing ones would still get it.
He also said data centers are key to the national interest in leading on artificial intelligence development.
“If Ohio wants to be a leader, a leading edge tech state in the Midwest, having those kinds of investments in the state is important,” Husted said.
Staying in playing shape
Husted still hasn’t drawn a major opponent for next year’s election. An endorsement from Trump seems to have cleared the Republican field. And Democrats are still waiting to see if former U.S. Sen. Sherrod Brown might try to return to the Senate or make a bid for governor – or not do anything.
Husted wouldn’t say if he has a preference for what Brown decides. A former college football player with a penchant for sports tropes, Husted compared his mindset to an athlete’s while training in the off-season.
“If you’re not in the weight room lifting, if you’re not out there running, if you’re not out there preparing for the season, then you’re falling behind,” Husted said. “And so every single day I’m preparing for the big game. It doesn’t matter if it’s not political season.”
Stretching out the metaphor a little further, he added: “I prepare to be the best I can be. I can’t control what team shows up on the other side of the field.”
Life in the Senate
Husted, who has been in politics for about 25 years, has worn many hats in government, all of them in Columbus. Now, he’s been in Washington, D.C., for about six months and said the worst thing about it is traveling back and forth.
As for the politics in Washington, he said it’s not unlike his time serving in the Ohio House in the 2000s, which included a stint as House speaker. He said he’s working to build trust with his colleagues.
“In the first few months, I just I listened a lot and talked very little,” he said. “Now that I feel a little more confident how to navigate the place, I’m able to exercise more of a leadership role.”
