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Ohio Passes FY2012-2013 Budget
The ink is barely dry, but we wanted to point out some apparent policy changes in the recently enacted Ohio Budget Bill (H.B. 135) that could affect PDG clients and the process for purchasing capital improvements.
As information continues to be published, we will try to keep you informed as best we can, however, if you are uncertain of changes that affect your client, you and/or your client may want to do additional research or seek legal advise. Administrative rules and procedures for the new/revised programs will undoubtedly be forthcoming (from somebody).
Economic Development
The budget bill authorizes the transfer of the liquor distribution system to JobsOhio, the new private not-for-profit organization previously created in H.B.1, to provide an on-going revenue stream to fund ED activities. The Governor recently appointed 8 members to the JobsOhio Board. The organization will work closely with six existing regional ED organizations to create proposals for coordinating strategies. Regional Growth Partnership, located in Toledo, would appear to on of the six regional organizations.
Prevailing Wage Thresholds
According to a bulletin, issued by Benesch, Attorneys at Law, Ohio Prevailing Wage will no longer be required for certain public improvements, effective September 29, 2011,
• Projects no longer be subject to Ohio Prevailing
Wage requirements include:
• ED improvements financed with ORC Chapter
165 bonds;
• Improvements constructed/financed by Ohio
port authorities;
• Certain projects supported by ODOD
• Projects receiving ED assistance
(ORC Chapter 166)
• Energy resource development projects or
facilities (ORC Chapter1551);
• Projects by community urban redevelopment
corporations in conjunction with municipal
corporations (ORC Chapter 1728) to assist
blighted areas; and
• Industrial, distribution, commercial, and research
projects receiving financial assistance from
ODOD (ORC Chapter 22).
Thresholds for application of Ohio Prevailing Wage Law will apply to new public improvements costing over $78,258 and reconstruction of existing public improvements costing over $23,447. The Director of Commerce is authorized to adjust the thresholds every two years.
Thresholds will increase over the next three years - to $125,000 in the first year, $200,000 in the second year, and $250,000 in the third year and thereafter. Reconstruction of existing public improvements will increase to $38,000 in the first year, $60,000 in the second year, and $75,000 in the third year and thereafter.
However, H.B. 153 DID NOT alter thresholds for public improvements for roads, streets, alleys, sewers, ditches and other works related to road or bridge construction and DID NOT alter thresholds for other "public improvements" whatever that means?! Ohio public universities and colleges are still subject to Ohio Prevailing Wage Law.
Also, if the project has any federal funding, Davis-Bacon Prevailing Wages may apply.
Contracting Requirements
ACEC Ohio reports that the bill did not eliminate Ohio's multiple-prime contracting requirements for public works projects, state and local authorities will have three alternatives to multiple-prime, including:
• General Contracting - single construction contract with
a general contractor
• Design/build - single entity for both design, construction,
demolition, alteration, repair or reconstruction.
The public authority would be required to evaluate the qualifications of competing design/building firms and rank them, then open contract negotiations with the highest-rank firm. They would also be required to retain the services of a "criteria architect or engineer" to assist in development of the project scope and evaluation of the design/build firms. The criteria architect/engineer may serve as the public authority's representative throughout the project.
• Construction manager at-risk (CMAR)–contract with
CMAR who would be required to provide a guaranteed
maximum price for the project utilizing "open book
pricing method".
The Ohio DAS is to promulgate rules setting our procedures and criteria before these new delivery systems would be available to state and local authorities.
Other Things We've Heard
• Major changes in qualification-based selection law for
design professionals
• Authorization to lease Ohio Turnpike
• Creation of Local Government Innovation Program–
$45 million in FY2013.
• Reduction in Local Government Funds
• Authority for local governments to collaborate and
share services |
