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Ohio’s Budget, As Recently Passed By The House, Contains Key Changes To Public Construction

On May 5, 2011, the Ohio House of Representatives passed H.B. 153, Ohio’s main operating budget for fiscal years 2012 and 2013. The current bill contains some key provisions affecting the public construction industry in the areas of prevailing wage law and alternative delivery methods.

Prevailing Wage

Under the budget bill, for prevailing wage requirements to apply, a project must be constructed by a public authority or constructed for the benefit of a public authority to be considered a “public improvement project,” even if the project uses or receives financing, grants, or similar support from a public authority.

The budget bill also increases the prevailing wage thresholds for both construction and reconstruction on public improvements to $3.5 million (with a biennial adjustment as under current law by the Department of Commerce) for projects other than roads, sewers, ditches and other related works. (Threshold levels for road projects remain the same at $78,258 for new construction and $23,447 for reconstruction and repair.) It prohibits school districts and educational service centers from requiring prevailing wages, and exempts from prevailing wage requirements public improvement projects undertaken by, or under contract for, state colleges and universities, various economic development programs administered by the Department of Development, and the construction or repair of a port authority facility.

The budget bill also eliminates the ability of an interested party, such as a labor union, to file a lawsuit against a party that it believes has violated the statute before the Department of Commerce has made its determination.

Alternative Delivery Methods

The budget bill authorizes public authorities, other than the Ohio Turnpike Commission, to use the following alternative methods of construction delivery: construction manager-at-risk, design-build, design-assist, or general contractor. It also eliminates the requirement that the multiple-prime contracting method be used, but does not prohibit its use. Construction manager-at-risk and design-build are defined in the bill, and the process that a public authority must employ to select them is specifically prescribed.

The budget will now be considered by the Senate, where significant changes can still be made. The goal is to have all legislative work on the budget completed and to the governor by June 30, 2011.

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About this Author

Peter Hahn, Construction attorney, Business Disputes lawyer, dinsmore shohl

Peter is a construction lawyer. His substantial experience and understanding of the industry, as well as his knowledge of general business disputes, allow him to modify his approach for each client, carefully crafting a strategy to meet their individual needs and goals. 

Peter’s understanding of the construction industry allows him to advise clients through disputes and liability avoidance at every phase of a construction project, from the drafting and negotiation of initial contracts all the way through to post-project issues such as...

Donald B. Leach, construction industry attorney, Dinsmore Law firm

Leveraging three decades worth of experience in working with the construction industry with a thorough knowledge of the unique challenges facing the industry today, Don Leach has helped a wide variety of clients accomplish their objectives. Having assisted clients through both litigation and transactional matters, Don is able to tailor his approach to help clients reach their intended resolution in a cost-effective manner.

Working in both the public and private sector, and representing owners, developers and contractors, Don utilizes his knowledge about the business, financial and legal challenges facing the construction industry to provide his clients with the advantages they need. A former president of the Builders Exchange of Central Ohio, where he received the Cornerstone Award, as well as a member of the Ohio Board of Building Standards, Don's familiarity and relationships within the industry allow his clients to benefit from insight gained only through extensive experience and relationships. From drafting and negotiating contracts to defending and prosecuting construction lien, contract and bond disputes, Don’s practical approach ensures clients’ needs and goals are met in a timely, efficient manner. 

William Mattes, Complex Commercial LItigator, Dinsmore law practice

Bill is an experienced litigator who focuses his practice on complex commercial litigation, including high-stakes business disputes and bet-the-company matters. Bill also has extensive experience with construction litigation, whether dealing with construction disputes or OSHA matters, including handling investigations for on-site accidents and fatalities. 

Understanding that every client has unique needs and tolerances, Bill works closely with clients to build a litigation strategy that fits their objectives, whether negotiating alternative...