The Ohio Senate Finance Committee released its version of the state budget bill, Sub. HB 49 Monday agreeing with AIA Ohio on all three issues architects have raised relative to the original bill Governor Kasich introduced last January:

First, it removed a House inserted provision that allowed the Department of Administrative Services to circumvent the Qualification Based Selection of Architects (QBS).  The language would have allowed DAS to award its own design and construction contracts as “supplies” or “services” contracts under R.C. Chapter 125, thereby circumventing R.C. Chapter 153 construction law.  Using this language, DAS could have authorized a private third-party administrator to bid and award construction contracts, without the transparency and fair processes required under ORC 153.  Further, DAS could have used its cooperative purchasing authority to extend this same contract to all political subdivisions.  The state’s construction authority, OFCC, could not have challenge these contracts since “a contract awarded by DAS takes precedence over the commission’s authority.”

When this provision was inserted into HB 49 by the House, AIA Ohio issued an Action Alert asking members to communicate opposition.  Points made about the provision:

  1. It bypasses the competitive processes and protections of standard construction under ORC Chapter 153, including advertising, bonding, subcontractor protections, etc.;
  2. It creates a path for all political subdivisions to avoid competitive bidding for construction;
  3. It could be a path to “pay to play” and the selection of less qualified professionals;
  4. It makes the award of construction contracts less transparent;
  5. It breeds confusion and a sense of unfairness within the design and construction industry in Ohio;
  6. It provides no legal recourse to challenge the appropriateness of a construction contract awarded by a non-construction agency (DAS).

Second, The Senate Finance Committee followed the House of Representatives by leaving intact the House’s removal of Governor Kasich’s provision that would have extended the sales tax to both interior and landscape design services.

Third, the Senate Finance Committee maintained the provision that’s intended to address the 2015 U.S. Supreme Court decision against the North Carolina Board of Dental Examiners that ruled they violated federal antitrust laws because members of the state’s dental board were active participants in the profession they regulated.

HB49 proposes the creation of a third-party review process by the Department of Administrative Services (DAS), in which the DAS would review any action taken by or on behalf of a board that could be subject to antitrust laws. Not only would this protect boards from costly legal action for antitrust-related concerns, it would also prevent unnecessary delays in business decisions the boards make and promote better coordination and efficiency within the licensing boards structure.

Finally, HB 49 continues to fund the operation of the Ohio Architects Board, though at a slightly lower level than the House version.  Faced with a projected $1 billion shortfall in both sales and income taxes, senators balanced the budget with a 3-4% across the board cut in the administrative costs for state agencies ($20 million), more targeted cuts to agency programs ($100 million), the elimination of millions of dollars in earmarks and reducing Medicaid $200.

Following the unveiling of the Senate Finance Committee’s Substitute Bill, it was accepted by the Committee and will undergo several additional hearings where minor changes may be made prior to being approved by the full Senate on June 21. From there it will be reconciled by a conference committee composed of House and Senate leaders before being sent to Governor Kasich for his signature prior to June 30.

At this point state lawmakers have heard from AIA members and have responded favorably to all of AIA Ohio’s Budget Bill concerns.  We’ll update you with any meaningful developments as the bill progresses through the Conference Committee and on to the Governor’s desk.