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No. 16 July 15, 1998 PLEASE CIRCULATE THIS BULLETIN TO YOUR COUNCIL, DEPARTMENT HEADS & STAFF Information Needed About ODOT Abandonment of State Routes Municipalities throughout the state are beginning to feel the impact of the Ohio Department of Transportation's new policy which ends ODOT's participation in the cost of repairing and repaving of state highways inside municipalities. ODOT justifies dropping its payment of these costs by simply saying that the department is not obligated by statute to pick up these costs. Though the department will still continue to pick up costs for repaving of state routes in unincorporated areas of the state, the department's attitude toward a partnership with municipalities is one marked by whimsy. When they feel flush with money, as they did a few years ago when their 100% participation started, they'll help out without statutory authority. But should their plans change and they need to squeeze money out of their budget to finance paltry, but overpromised new construction projects, they have no problem squeezing that money out of municipalities. We have begun discussions with some legislators about legislation to require ODOT to pay for the repaving and repair of their entire state system of highways, but we need your help. On the backside of this page is a chart done for us by the City of Springfield. The chart shows the impact this new ODOT policy would have had on neighborhood streets if the policy was in effect from 1993 to 1997. We need this same kind of research from as many municipalities as possible if we are to be successful in our efforts to reverse this process. The first column of the chart shows the city's total state and federal dollars for the year and the five-year total. The second column shows the number of dollars that would have been lost had the ODOT policy been in effect in the year shown. The third column shows how many dollars the city had for neighborhood streets and the lesser amount it would have available had the city been forced to use its own dollars for state projects instead of local streets. It is important that we receive this information from you as soon as possible. We would like this information no later than July 31. We not only would like to use this research in talking to legislators, but also to talk to representatives of both candidates for Governor about this change in policy. If you wish to share the information you gather on this issue, we would recommend that you share it with not only your local legislators, but with Governor Voinovich. If you have any questions about this information, please, contact John Mahoney at our office in Columbus. PERS Board Candidates? This year is the year to elect a municipal member to the Public Employees Retirement System Board. All municipal officials who are members of PERS are eligible to run for this Board seat. In order to run, a candidate must have 500 valid signatures from municipal employees on PERS nominating petitions. Those signatures must be from at least 10 different counties and represent a minimum of 20 signatures from each of those counties. Petitions are due at the offices of PERS by 4:30 p.m. on Wednesday, August 12. As in the past, the League is willing to help municipal officials who wish to run for this Board seat. That help has been in the form of helping gather signatures, as well as communicating with our membership about an officials candidacy. If you are interested in the League's assistance or have any questions regarding membership on the PERS Board, please, contact either Sue Cave or John Mahoney at our office in Columbus. Analysis Of SB 71 (Construction Contracts/Public Improvements Bonds) The bill will become effective September 30, 1998. There are two major portions of the bill, sponsored by Senator Cupp, they are as follows: 1) The bill requires certain subcontractors and material suppliers supplying labor or materials that cost more than $30,000 to serve a notice of furnishing upon the principal contractor for a public improvement as a condition of bringing an action upon the bond for that improvement, and limits recovery to only amounts owed for labor and work performed and materials furnished during and after 21 days preceding service of the notice. 2) The bill also voids various types of provisions of a construction contract that are considered to be against public policy and specifies related provisions and actions that are permitted despite those voided provisions. It is the second portion of this bill that will have an impact on municipal contracts. Under the bill, any provision that waives or precludes liability for delay during the course of a construction contract or subcontract when the cause of the delay is a the direct result of the owner's act or failure to act is now void and unenforceable. The standard of void and unenforceable would also apply if any other remedy for damages for delay was waived. Analysis Of HB 648 (Changes in the State Retirement Systems/Especially Disability Benefits) The bill will become effective September 16, 1998. HB 648, sponsored by Rep. Van Vyven, was a wide sweeping bill that effected all the of the states five retirement systems, but our analysis will concentrate on specific changes to the Police & Firemen's Disability Pension Fund. Additional Medical Treatment - Sub. H.B. 648 provides that each retirement board shall adopt rules requiring disability benefit recipients, as a condition of continuing to receive benefits, to agree in writing, to obtain any medical treatment recommended by the board physician and to submit medical reports regarding the treatment. If the recipient refuses to obtain the treatment or submit the required medical reports, the recipient's disability benefit shall be suspended until the treatment is obtained, the medical report is submitted, or the board physician certifies that the treatment is no longer helpful or advisable. Should the recipient's refusal continue for one year, the recipient's right to the disability benefit shall be terminated as of the effective date of the original suspension. Annual Statement of Earnings and Current Medical Condition - Sub. H.B. 648 provides that each retirement board shall adopt rules requiring each disability benefit recipient to file an annual statement of earnings, current medical condition, and any other information required by board rule. If the recipient refuses to file the statement or information, the recipient's disability benefit shall be suspended until the statement or information is on file. Should the recipient's refusal continue for one year, the recipient's right to the disability benefit shall be terminated as of the effective date of the original suspension. The retirement boards may waive the annual statement of earnings and current medical condition for recipients whose disability is ongoing, as certified by the board physician. Reemployment of Disability Benefit Recipients - Sub. H.B. 648 provides an exception to each system's existing law which generally requires public employers to restore disability benefit recipients to their former position and salary or a similar position and salary if the retirement board determines that the disability recipient is no longer physically or mentally incapable of resuming service and the applicable leave-of-absence period has not expired (5 years in PERS, STRS, SERS and PFDPF; no limit on number of years in HPRS). Under the bill, employers are not required to reemploy disability benefit recipients who were dismissed or resigned in lieu of dismissal for dishonesty, misfeasance, malfeasance or conviction of a felony. Objective Criteria in PFDPF Disability Process - Sub. H.B. 648 requires the PFDPF board to adopt rules establishing objective criteria to administer its existing disability standards. The rules shall include the following: (1) standards for evaluating a member's illness or injury; (2) standards for defining the occupational duties of a police officer or firefighter; (3) standards for assigning physicians and vocational specialist to conduct examinations of the member; (4) standards for written medical reports, opinions and recommendations on each disability application; and (5) standards for assessing the member's potential for retraining or reemployment. Minimum Statewide Standards for Physical Examinations - Sub. H.B. 648 requires the PFDPF board to adopt rules establishing minimum statewide medical testing and diagnostic standards for physical examinations of prospective members of the fund. The standards shall include evaluation of the existence of any heart, cardiovascular or respiratory diseases, and shall specify the form of and information to be included in the physician's report. Upon adoption of these rules, the board shall notify each employer of the minimum standards and any changes thereto. Once the standards take effect, the employer shall incorporate them into the physical examination of all employees who become members of the fund after the effective date of these standards. Permanent and Total Disability Award in PFDPF - Sub. H.B. 648 changes the PFDPF permanent and total disability award from 72% of the member's annual salary for the last twelve months prior to disability to 72% of the member's average annual salary (average of the member's highest annual salary during any three years). Off-Duty Disability Awards in PFDPF - Sub. H.B. 648 permits the PFDPF board to fix the amount of an off-duty disability award based upon the member's impairment as determined under the objective criteria adopted by board rule under this bill, up to a maximum of 60% of the member's average annual salary. The board may increase or decrease the award whenever the board determines that the impairment of the member's earning capacity warrants an increase or decrease. Medical Reexaminations in PFDPF -Sub. H.B. 648 provides that upon medical reexamination of a disability benefit recipient, the board physician shall determine and certify to the PFDPF board whether the recipient continues to meet the disability standard upon which the recipient's disability award was based. If the board physician determines that the recipient no longer meets the standard and the board concurs with this determination, the recipient's disability award shall be terminated upon the earlier of 90 days after the board's concurrence or employment as a police or firefighters except that the board may change a permanent and total disability award to a partial disability award if the recipient were to otherwise qualify. The bill also provides that a recipient's disability award shall be terminated upon employment as a police or firefighter regardless of any medical determination concerning the recipient's condition. Application for Disability: Employer Notification: Leaves-of-Absence in PFDPF -The bill requires the PFDPF board to notify the employer, within 14 days after receipt of a disability application, of the member's rank or position. The employer is required, in turn, to forward to the board, within 28 days after receipt of such notice, a job description and any other information required by the board to process the application. The bill increases the statutory leave-of-absence period for disability benefit recipients in PFDPF from three years to five years. Ohio News Network (ONN) The Ohio News Network is the nation's only statewide, 24-hour cable news channel. Like a CNN for Ohio, ONN has unique capabilities to provide news, weather and information to a statewide audience. Currently, ONN reaches more than 350,000 Ohio households in 14 counties. ONN is on plan to reach more than 600,000 Ohio homes by years end. The ONN news team would like to receive news tips from Ohio's municipal offices. If the ONN news room phone and fax number are not included in your media contact list please be sure to include them. John Sprugel is the news director for ONN. John and the rest of the ONN news team can be reached at (614) 280-3600. You may fax news releases and media advisories to ONN at (614) 280-3615. Analysis of Am. Sub. H.B. 426 (Subdivision taxing authority & reserve accounts ) The legislation will become effective July 22, 1998 Am. Sub. H.B. 426 (Clancy) as passed by the General Assembly amends the Ohio Revised Code to permit taxing authorities of subdivisions to create accounts in which funds may be reserved for budget stabilization, self-insurance claim payments, the payment of claims under retrospective ratings plans for workers' compensation, accumulated employee leave, capital projects, and non-expendable trusts; to specify that certain amounts in such reserves shall not affect revenue distributions to certain subdivisions through local government funds; to change the conditions under which a subdivision's spending authority must be changed when its projected revenue changes; to permit all subdivisions to authorize purchases in excess of $5,000 for certain goods and services without the necessity of authorizing each individual purchase; to alter the definition of a large manufacturing facility eligible to receive tax incentives under the laws governing enterprise zones, and to allow purchasers of certain large manufacturing facilities to continue receiving credits against the corporate franchise tax that the seller was receiving for the purchase of new manufacturing machinery and equipment; and to change the time by which certain fees collected by clerks of court must be transmitted to the Treasurer of State or deposited into the county treasury. Specifically, the legislation: * Permits subdivisions to create reserve balance accounts in certain funds to reserve moneys for budget stabilization, self-insurance claim payments, and the payment of claims under retrospective ratings plans for workers' compensation. * Permits subdivisions to create special funds for accumulated sick and vacation leave and payments in lieu of taking compensatory time off for terminated or retired officers and employees, salaries in certain fiscal years, capital project's, and non-expendable trust funds. * Prohibits reduction of a subdivision's taxing authority or Local Government Fund or Local Government Revenue Assistance Fund distributions because of the accumulation of a reasonable amount in such reserve balance accounts or because of the accumulation of moneys in a non-expendable trust fund. * Grants all subdivisions the authority to purchase certain goods and services in excess of $5,000 without obtaining documents authorizing each individual purchase. * Modifies the circumstances under which a subdivision must obtain an amended certificate of estimated resources. * Changes the definition of "large manufacturing facility" for purposes of the Enterprise Zone Law. * Authorizes the transfer of certain corporation franchise tax credits. * Changes the time by which certain fees collected by clerks of court must be transmitted to the Treasurer of State or deposited into the county treasury. Analysis of Am. Sub. S.B. 77 ( Public office - annual financial reporting ) The legislation becomes effective August 13, 1998 Am. Sub. S.B. 77, sponsored by Sen. Karen Gillmor, changes the ORC to require certain public offices to publish a notice announcing the completion and availability of their annual financial reports instead of publishing the reports themselves, to make other changes regarding these reports, to require notification of the Auditor of State upon the creation or dissolution of a public office, to allow the Auditor of State to audit the accounts of Medicaid providers receiving public money, to authorize employees designated by the Auditor of State to issue subpoenas and exercise other authority, and to specify that the rulemaking procedure the Auditor of State must now follow in adopting rules under certain statutes applies to all rules the Auditor of State adopts. Specifically the legislation: * Authorizes the Auditor of State to audit the accounts of Medicaid providers at the request of the state Department of Human Services. * Requires certain public offices to publish a notice of the completion and availability of their annual financial reports, instead of publishing parts of the reports themselves. * Requires notification of the Auditor of State after the creation or dissolution of a public office. * Authorizes employees designated by the Auditor of State to issue subpoenas and exercise other investigative authority. * Specifies that the special rule-making procedure the Auditor of State must follow in adopting rules under certain statutes included in the chapter of the Revised Code governing the Auditor of State's operations applies to all rules the Auditor of State adopts under that chapter. * Changes the general deadline for filing from 90 days to 60 days after the close of the fiscal year.
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