Last week, State Senator Matt Huffman (R) introduced S.B. No. 72. The bill proposes modifying several statutes to limit the scope of the prevailing wage obligation in Ohio. The proposal comes on the heels of Kentucky’s elimination of its prevailing wage law.
While there are a number of changes made in the bill, the primary one is to eliminate the requirement that political subdivisions (like Ohio’s cities) pay prevailing wage on “public
improvements.” Instead, S.B. 72 contemplates that each political subdivision (as well as each state college or university or special district) could elect to apply the prevailing wage obligations to “any” improvement that is “undertaken by, or under contract for,” the political subdivision, special district, or college/university.
The last major rewrite of the prevailing wage law was in 2011, and that rewrite, like the one proposed, also narrowed the scope of the statute. S.B. 72 was referred to the Senate Finance Committee yesterday. Thus, it is still very early in the legislative process.
If these changes pass, the legal landscape will turn from one of uniformity to one in which the prevailing wage issue will need to be decided on each project within each of Ohio’s hundreds of counties, cities, townships, and other political subdivisions.
An interesting issue could arise when more than one political subdivision is involved in a project. For example, some economic development incentive arrangements involve multiple political subdivisions as parties to agreements. It is unclear from the proposed legislation which political subdivision’s decision will control whether a project is constructed using prevailing wages when the project is “under contract for” more than one political subdivision.
Stay tuned to vorysonlabor.com for additional updates as S.B. 72 progresses.
NOTE: This post was updated on March 8 to reflect that the bill was referred to the Senate Finance Committee on March 7, 2017.