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Toledo Legal News - News Republican plan would make prevailing Ohio wage law permissive

 

A bill that would allow local governments, special districts and colleges and universities to choose whether to abide by the state's prevailing wage laws for public projects faces the scrutiny of committee members during testimony in the Ohio House of Representatives.

Filed as House Bill 78, the bill would effectively drive down overall costs, joint sponsors of the bill said.

"This bill does not eliminate prevailing wage, but rather makes it permissive," joint sponsor Rep. Craig Riedel of Defiance said at the bill's introduction. "It gives local government entities the ability to decide for themselves whether they want to use prevailing wage on a job-by-job basis."

HB 78 would allow local decision-makers to make a determination on the issue. Additionally, the measure would increase the threshold for new construction projects calling for a prevailing wage from $250,000 to $500,000 with the intent to capture many new construction projects and eliminate current restrictions.

The Ohio Legislative Service Commission, in its analysis of the bill, offered examples of current law projects expressly subject to the Prevailing Wage Law, which include:

A contract financed in whole or in part under the Aid to Local Governments Law;

Acquisition of and construction services for a port authority educational and cultural performing arts facility;

Projects of a special improvement district;

Projects undertaken with funding provided under the Water Development Authority

Law.

"Prevailing wages mandated on projects in small villages and townships, especially in my district, can make some public-improvement projects as much as 20 percent higher than the market rate," said the bill's other joint sponsor Rep. Susan Manchester of Waynesfield. "Not only is this an issue of local control, but House Bill 78 serves as a great cost-savings measure for our villages and townships."

Riedel said the prevailing wage law, as is, amounts to state government overreach into local government affairs.

"And it works opposite of free market principles," he added. "By not allowing the labor rates to be part of the competitive bid process on a project, the taxpayer ends up overpaying because the free market is unable to play out."

He shot down supporters' claims that the prevailing wage law provides higher quality work and safer working conditions, saying there is no evidence supporting the assertions.

"I worked 27 years in private business, all in the construction industry," Riedel said. "I will attest that the quality of workmanship and safety on construction projects today are of the same caliber whether or not that project pays prevailing wage.

"There may have been a day 40 or 60 years ago when that was true but it certainly is not the case now. In today's construction world, the workmanship and safety culture at a non-union construction company is every bit as equal to that of a union construction company. "

Democrat Rep. Richard Brown of Canal Winchester argued prevailing wage laws ensure that workers earn a fair wage.

Laws like HB 78 reduce the efficiency and safety of projects and cut worker pay, harming the public interest and workers alike, he posited.

The bill would maintain the current prohibition against a public authority applying prevailing wage requirements to a public improvement undertaken by, or under contract for, a school district board of education or educational service center governing board, OLSC analysis provided. It would add the prohibition for a political subdivision or special district from applying the law to any of the following projects, currently exempt from the law:

Certain projects undertaken by a soil and water conservation district or pursuant to a petition filed under the Single County Ditches Law, the Joint County Ditches Law, or the Interstate County Ditches Law;

The construction of an erosion control structure under continuing law; and

Projects undertaken by a transportation improvement district.

"Understanding that prevailing wage does work well for some areas of the state, this bill will place decision making power in the hands of those individuals closest to the project," Manchester concluded. "The purpose of HB 78 is to empower local governments and state institutions of higher education to make the best decisions for their constituencies, while also protecting taxpayer dollars and pursuing free markets."

Fifteen fellow House members have signed on as cosponsors of the bill, which had not been scheduled a second hearing at time of publication.

KEITH ARNOLD, Daily Reporter Staff Writer

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