The Construction Conversation Ohio s Legislative, Administrative, and Judicial Two-Way Newsletter

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1 Ohio s Legislative, Administrative, and Judicial Two-Way Newsletter July, 2017 A Service of Luther L. Liggett, Graff & McGovern, LPA Legislative: Antitrust Appeal in Licensure The General Assembly passed into law an appeal mechanism for claims of antitrust activity in licensure proceedings before state boards. (Cont d page 2.) Administrative: New Evidence Limited in Administrative Appeal The Court of Appeals for Cuyahoga County has denied a company from adding new evidence in its administrative appeal, on the basis that judicial review is limited to the record below unless an exception applies. (Cont d page 2.) Legislative: Budget Bill Changes Construction Authority The Governor signed into law three provisions relating to the construction industry as part of the Ohio budget in House Bill 49. (Cont d page 3.) Judicial: Statute of Frauds Bars Contractor In a split decision, an appellate court has ruled that a contractor cannot enforce a mechanics lien when Ohio s Statute of Frauds invalidates the underlying contract. (Cont d page 3.) Administrative: State Bids Separate Primes in New Work The Ohio Facilities Construction Commission is seeking separate bids by August 11 th, for a North High Street renovation in Columbus totaling over $30 million. (Cont d p. 3.) Legislative: House Task Forces Continue Work Over Break House Speaker Cliff Rosenberger (R, Clarksville) created five House Task Forces to continue research and testimony during the legislative summer recess, including: Education and Policy Energy Policy Base Realignment and Closure and Military Affairs Alzheimer s and Dementia Heroin, Opioids, Prevention, Education and Safety (Cont d p. 4.) Administrative: Secretary of State Certifies Two Ballot Issues On November 7, 2017, Ohioans will consider two statewide ballot initiatives: Marsy s Law, to create the Crime Victims Bill of Rights, and the Drug Price Relief Act. (Cont d p. 4.)

2 Page 2 Legislative: Licensure (Cont d) Antitrust Appeal in House Bill 49 enacted new Revised Code section in response to a United States Supreme Court decision that a state dental board engaged in anticompetitive behavior when denying a license to a teethwhitening business. In the construction industry, Ohio s new law applies to the Ohio licensing boards for Architects, Engineers, Landscape Architects, and to the Ohio Construction Industry Licensing Board, among 32 covered agencies. Any board action excluding present or potential competitors from the occupation or industry regulated by the board or commission can be appealed to the Common Sense Initiative Office overseen by the Lieutenant Governor. The appeal acts as an automatic stay, as the board or commission shall cease the ongoing action or not take the proposed action until the office has approved of the action. The Office can reverse the board. If the office disapproves the board's or commission's action, the action is void. Administrative: New Evidence Limited in Administrative Appeal (Cont d) As background, the Ohio Department of Developmental Disabilities' revoked a provider company s certificate to provide non-medical transportation services to individuals. The Department cited the provider company in 2012 and again in 2015 for compliance violations. After Department revocation, the provider company appealed through the Common Pleas Court, where the provider moved to supplement the Department record with documents showing compliance after taking corrective measures. Ohio Revised Code (K) confines the court's review to the record certified by the administrative agency. The reviewing court may consider new evidence only if "newly discovered" which was not available during the agency appeal process from "a reasonably diligent search." Such evidence must exist at the time of the administrative hearing, and is not "newly created evidence" such as recommendations or post-appeal remedial measures. In addition, Ohio Revised Code confines the court review to the transcript, unless the transcript does not contain a report of all evidence, or the provider company was not permitted to appear in person or through an attorney; testimony was not under oath; the Department refused to provide a subpoena; or the transcript did not contain conclusions of fact supporting the Department's decision. The Court of Appeals rejected the provider company's claim that revocation was unduly harsh and excessive for mere technical administrative violations, all of which had been corrected. A court review of an agency adjudication is limited to whether the decision is supported by a preponderance of reliable, probative, and substantial evidence. A court may not substitute its judgment for that of an agency. Cty. Med., Inc. v. Dept. of Dev. Disabilities, 2017-Ohio-5745

3 Page 3 Legislative: Budget Bill Changes Construction Authority(Cont d) The legislation raises the competitive bidding threshold for Port Authorities from $100, to $150,000.00, although it remains unclear what process a port authority would use to award projects of that size without charges of favoritism. R.C The legislation also allows the Ohio Facilities Construction Commission to debar a partner, officer, or director when it debars a construction contractor. The definition of contractor is amended to include subcontractor or material supplier. R.C Finally, the legislation enacts Senate Bill 8, which directs the state to establish an option for career-technical education students to participate in pre-apprenticeship training programs. R.C Judicial: Statute of Frauds Bars Contractor (Cont d) The contractor contended that he entered into an oral agreement with two homeowners to maintain a vacant lot, provided that the contractor enjoy a right of first refusal to purchase the property. When the homeowners sold the lot to a nephew, the contractor filed a lien and sued for the value of his maintenance services. Ohio s Statute of Frauds requires a written agreement for any interest in real estate, R.C The contractor admitted that he could not enforce the sale to him, but argued the oral agreement to be divisible so as to enforce payment for the services rendered. The three judges of the Trumbull County Court of Appeals, 11 th District, each held a different opinion. In the decisional opinion, the judge held that the terms of the oral agreement were so intertwined as to not be divisible. With no enforceable contract, likewise the lien is unenforceable. The second judge concurred, but differed as to reason. Since the Statute of Frauds does not apply to Mechanics Lien law, the judge found that the contractor still lost by failing to prove that damages for services were due. The third judge disagreed entirely, holding that a mechanics lien creates an action against the land and therefore against the current owner regardless of the underlying contract. Krlich v Clemente, 11 th Dist. Trumbull, 2017-Ohio Administrative: State Bids Separate Primes in New Work (Cont d) $10 million (one-third) is estimated for the HVAC contract, with over $5 million for Electrical. Further detail and documents can be obtained on the Ohio Facilities Construction Commission website under Opportunities-Construction Bids. Separately, the Ohio Department of Natural Resources seeks an Electrical Contractor to bid on upgrades at Maumee Bay State Park. The base contract is estimated at $375,000.00, and bids are due August 3, For more information, asp

4 Page 4 Legislative: House Task Forces Continue Work Over Break (Cont d) The Task Force on Education and Poverty is chaired by Representative Bob Cupp (R, Lima), who has served as Allen County Commissioner, Justice of the Ohio Supreme Court, State Senator, and Counsel to the Ohio Auditor. Cupp has appointed 9 members to the Task Force from local schools around the state. Cupp is the sponsor of House Bill 166, comprehensive legislation to address workforce development throughout Ohio. HB 166 is likely to be part of the Task Force s consideration, as the Bill would: Create a Jobs Ready Certificate ; Create regional Workforce counseling collaboratives; and Adopt a Pre-Apprenticeship program option for career-technical students. The legislation attempts to bring Ohio in compliance with the federal Workforce Innovation and Opportunity Act (WIOA), and is supported by the Ohio Association of Community Colleges. Constitution to require courts to protect crime victims rights similarly to the rights of an accused. This would include the right to notice of all legal proceedings against the accused, the right to testify at postconviction hearings, and the right to financial restitution. The law s name refers to the trial of the murderer of Marsy Nicholas which led to the passage in California and Illinois of a crime victims bill of rights. The law is credited with influencing reduction of parole and lengthening of prison sentences. Issue 2 would enact a statute to prohibit the State of Ohio from entering into any agreement for purchasing prescription drugs unless the net cost is the same or less than the lowest price paid by the U.S. Department of Veterans Affairs. While seemingly a positive requirement, significant opposition has arisen from employer, medical, and pharmaceutical interests In proponent testimony, the Association stated that, Pre-apprenticeship training programs in high schools help prepare students for a registered apprenticeship program while also help [sic] to students accelerate through a four or five year apprenticeship program. Administrative: Secretary of State Certifies Two Ballot Issues (Cont d) Issue 1 would amend Ohio s

5 July, 2017 Page 5 Join us in Call-In on Thursday, August 17, :30 p.m. TOPIC: Case Law, Administrative Actions Thursday, September 21, 2017 Thursday, October 19, 2017 Thursday, November 16, 2017 Thursday, December 21, 2017 Dial In: Access Code #

The Construction Conversation MCA of Ohio s Legislative, Administrative, and Judicial Two-Way Newsletter

The Construction Conversation MCA of Ohio s Legislative, Administrative, and Judicial Two-Way Newsletter MCA of Ohio s Legislative, Administrative, and Judicial Two-Way Newsletter February, 2018 A Service of Luther L. Liggett, Graff & McGovern, LPA www.graffmcgovern.com Legislative: WBE; EDGE, MBE Reciprocity