February 1, 2019
OML UPDATE AT-A-GLANCE
Here are the top three things you need to know from this past week:
- This week, Governor DeWine activated the Ohio National Guard's 172nd Cyber Security Protection Team to intercept and prevent an attempt to access the City of Akron's funds. Suspicious activity was reported on the city network this Tuesday, prompting the Akron Police Department to temporarily shut down critical city hardware and software. Mayor Horrigan requested the team be deployed to assist the FBI and the Ohio State Highway Patrol with the situation.
- The Bureau of Worker's Compensation announced Monday that 22 Ohio fire departments will collectively receive $196,896 in grants to help them purchase specialized washing machines, fire station exhaust systems and other safety gear aimed at minimizing firefighter's exposure to carcinogens. The grants are from the BWC's Firefighter Exposure to Environmental Elements Program, which was created to help protect firefighters from carcinogens and other health hazards they might encounter in the line of duty.
- The Ohio Supreme Court ruled this week that the Lucas County Board of Elections cannot prevent a measure from being placed on the ballot for a February 26 special election. The measure, a proposed charter amendment that is called a "Bill of Rights for Lake Erie", cannot be legally reviewed by a board of election and cannot be blocked from the ballot based on an assessment of its sustainability. The charter amendment would grant citizens the right to pursue legal recourses for polluting or harmfully impacting Lake Erie.
APPEALS COURT UPHOLDS CENTRALIZED COLLECTION OF MUNICIPAL NET PROFITS
On Wednesday, the Tenth District Court of Appeals ruled to uphold the state centralized collection of municipal net profit business filings in a 2-1 decision. The ruling denied that the provision, which was included in the 2017-'18 state operating budget bill, HB 49, did not violate the single-single rule due to the "interconnected nature of the municipal and state fiscal systems," according to Judge William Klatt and Judge Lisa Sadler. The single-subject rule dictates that a provision in a bill cannot differ from the bill's original subject.
The 160 cities and villages that joined the legal challenge to the state's centralized collection scheme also challenged the provision on the grounds of Home Rule. However, the court ruled that the Ohio Constitution "endows the General Assembly with the capability to circumscribe the imposition, raising, and collection of a municipal tax," according to another excerpt from the judgement.
The single dissenting vote came from Judge Gary Tyack who said that though he does not find most of the centralized collection provision problematic, he did disagree with the 0.5% administrative fee charged by the state as well as a penalty for municipalities failing to submit specific information to the tax commissioner within a certain timeframe. He said the 0.5% administrative fee was the state of Ohio charging municipalities a tax, and wrote in his dissent, "I do not believe the state of Ohio can legally tax municipalities. Nor do I believe the state of Ohio can legally seize and keep 50% of the net-profit tax due to a municipality, whether you call it a penalty or call it something else." He also expressed displeasure at the how the higher courts tend to rule on single-subject challenges.
While the League is disappointed in the court's ruling, we will continue to strive to build a stronger relationship between the state and its cities and villages and work to legislatively improve the system that has been plagued with significant complications for municipalities.
We will report to our members any future developments with the legal challenge.
GOVERNOR DEWINE ANNOUNCES ADVISORY COMMITTEE ON TRANSPORTATION INFRASTRUCTURE
This week, Governor Mike DeWine announced the creation of an advisory committee tasked with studying Ohio's current roadway conditions as well as recommending options to both maintain and strengthen the state's transportation infrastructure. The committee is made up of representatives from various businesses across the state as well as local leaders. Governor DeWine expats the committee to report their recommendations by mid-February.
The committee includes:
Jim Aslanides, a former state lawmaker and president of the Ohio Oil & Gas Association
Matthew Blair, Partner, Blair & Latell Co, LPA
Nicole Busey, Tax Director, Indirect Tax Compliance & Planning, Marathon Petroleum
Richard Dalton, Business Manager, International Union of Operating Engineers, Local 18
Marcus Hanna, CFO, Castellini Management
Ed Harmon, Chairman/President, NAI Harmon Group
Akron Mayor Dan Horrigan
Mike Jacoby, President & CEO, APEG
Muskingum County Sheriff Matthew Lutz
Caroline Ramsey, Communications & Intergovernmental Affairs, Honda
Dean Ringle, Executive Director of the County Engineers Association of Ohio
Kimberly Schwind, Senior Public Relations Manager, AAA
Doug Sibila, President & CEO, Peoples Services, lnc.
Taras Szmagala, Sr. Vice President, Eaton Corporation
Maryn Weimer, Director of Mobility, Ohio Center for Automotive Research.
Governor DeWine expects the committee to report their recommendations by mid-February.
"Investing in Ohio's transportation network is also an investment in the future of Ohio's high-performance economy," said Governor DeWine in a statement released this week. "We must ensure that our transportation system is not only safe and reliable, but that it also strengthens our economy by offering accessibility for current and new businesses."
The FOR (Fix Our Roads) Ohio Coalition, of which the League is a member, applauded the creation of this advisory committee. In a statement, the coalition asserted the urgency of creating a committee like this, saying, "
We are very concerned that Ohio's transportation needs, at the state and local levels, will not be met by the revenue streams that are currently available. We trust that the Governor's Advisory Committee will bring a focus to this issue and stimulate a productive discussion about potential solutions. A good transportation system is vital to our state's economy and the safety and well-being of its citizens."
The League also applauds Governor DeWine's decision to create this advisory committee, and we reassert the FOR Ohio Coalition's reminder that funding for the state's transportation infrastructure is imperative. We are grateful the Governor is calling attention to this important issue and we look forward to working alongside the administration and the rest of the coalition to ensure Ohio's roadways are safe, strong and fully funded for years to come.