City of Cleveland v. State

90 N.E.3d 979, 2017 Ohio 8882
CourtCourt of Appeals of Ohio, Eighth District, Cuyahoga County
DecidedDecember 7, 2017
DocketNo. 105500
StatusPublished
Cited by1 cases

This text of 90 N.E.3d 979 (City of Cleveland v. State) is published on Counsel Stack Legal Research, covering Court of Appeals of Ohio, Eighth District, Cuyahoga County primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
City of Cleveland v. State, 90 N.E.3d 979, 2017 Ohio 8882 (Ohio Super. Ct. 2017).

Opinion

Mike DeWine, Ohio Attorney General, By: Zachery P. Keller, Bridget C. Coontz, Assistant Attorneys General, 30 East Broad Street, 16th Floor, Columbus, Ohio 43215, ATTORNEYS FOR APPELLANT

Frederick T. Bills, David T. Patterson, Weston Hurd L.L.P., 10 West Broad Street, Suite 2400, Columbus, Ohio 43215, Amicus Curiae, For American Council of Engineering Companies of Ohio

Patrick A. Devine, Ice Miller, Arena District, 250 West Street, Suite 700, Columbus, Ohio 43215, Amicus Curiae, For Ohio Contractors Association

Barbara A. Langhenry, City of Cleveland Director of Law, By: Gary S. Singletary, Elizabeth M. Crook, L. Stewart Hastings, Assistant Directors of Law, 601 Lakeside Avenue, Room 106, Cleveland, Ohio 44114, ATTORNEYS FOR APPELLEE

Eve V. Belfance, Director of Law, By: Brian D. Bremer, Akron Law Department, 161 S. High Street, Suite 202, Akron, Ohio 44308, Amicus Curiae, For City of Akron

Joseph F. Scott, Scott & Winters, The Caxton Building, 812 E. Huron Road, Suite 490, Cleveland, Ohio 44115, Amicus Curiae, For The Campaign to Defend Local Solutions, Legal Scholars, and the International Municipal Lawyers Association

BEFORE: S. Gallagher, J., Keough, A.J., and Celebrezze, J.

JOURNAL ENTRY AND OPINION

SEAN C. GALLAGHER, J.:

{¶ 1} Defendant-appellant state of Ohio ("the State") appeals the trial court's judgment and order granting a permanent injunction that enjoined the State from enforcing 2016 Ohio H.B. No. 180 ("H.B. 180") and R.C. 9.49, which was subsequently designated R.C. 9.75 (herein referred to as " R.C. 9.75"). Upon review, we affirm the decision of the trial court. We find that the enactment of R.C. 9.75 was not a valid exercise of the legislature's authority pursuant to Ohio Constitution, Article II, Section 34 (hereafter referred to as " Article II, Section 34") and that the statute unconstitutionally infringes upon the municipal home-rule authority guaranteed by Ohio Constitution, Article XVIII, Section 3 (herein referred to as " Article XVIII, Section 3").

I. Background

2003-The Cleveland Ordinance

{¶ 2} Cleveland Codified Ordinances ("C.C.O.") Chapter 188, which is commonly called the Fannie Lewis Law, was enacted in 2003. The Fannie Lewis Law imposes local hiring requirements on public construction contracts over $100,000 by requiring that a minimum of 20 percent of the total construction work hours be performed by Cleveland residents, and that no fewer than 4 percent of those resident work hours be performed by low-income persons. C.C.O. Sections 188.02(a)(1), 188.01(g). The restriction does not apply to out-of-state workers because it "excludes the number of hours of work performed by non-Ohio residents." C.C.O. Section 188.01(c). The ordinance requires a contractor to pay a certain monetary amount for noncompliance and affords the city other remedies. C.C.O. Section 188.05. At the *982time of its passage, C.C.O. Chapter 188 comported with state laws.

{¶ 3} Cleveland City Council passed the Fannie Lewis Law because it believed the employment of Cleveland residents on construction projects funded, in part or in whole, with city assistance would help alleviate unemployment and poverty in the city of Cleveland. Although the efficacy of legislative policy decisions are largely irrelevant to judicial review, we note that the results of the Fannie Lewis Law have been largely favorable to Cleveland residents and low-income workers. The stipulated evidence presented to the court demonstrated that Cleveland residents averaged 21 percent of the hours worked on local Cleveland-financed construction contracts during the period 2013 to 2016. Over that period, Cleveland residents earned more than $34 million in wages. Of the 897,870 hours worked by Cleveland residents during this period, 100,638 hours were performed by low-income persons.

2014-Ohio Contractors Association Case

{¶ 4} Other Ohio cities, including Cincinnati, Columbus, and Akron, also impose local hiring requirements on public construction contracts. In 2014, the Ohio Contractors Association ("OCA") filed a complaint for injunctive and declaratory relief, alleging that the city of Akron's Local Hiring and Workforce Participation Policy violates the equal protection provision of both the United States Constitution and the Ohio Constitution. Ohio Contrs. Assn. v. Akron , N.D.Ohio No. 5:14CV0923, 2014 WL 1761611 (May 1, 2014). The federal court rejected the equal protection challenge, finding in part that "[Akron's] Local Hiring Policy does not create a competitive disadvantage for OCA members, all of whom currently stand on equal footing under the Policy with each other and with other contractors." Id. at *7. Subsequent to the federal court's decision, R.C. 9.75 was enacted.

2016-Enactment of R.C. 9.75

{¶ 5} In 2016, the General Assembly enacted what is now R.C. 9.75. R.C. 9.75 prohibits public authorities from requiring contractors on public improvement projects to employ a certain percentage of individuals who reside within a defined geographical area. R.C. 9.75 also prohibits the use of bid award bonuses or preferences to a contractor as an incentive to meet the local hiring requirements.

{¶ 6} R.C. 9.75(B) states as follows:

(1) No public authority shall require a contractor, as part of a prequalification process or for the construction of a specific public improvement or the provision of professional design services for that public improvement, to employ as laborers a certain number or percentage of individuals who reside within the defined geographic area or service area of the public authority.
(2) No public authority shall provide a bid award bonus or preference to a contractor as an incentive to employ as laborers a certain number or percentage of individuals who reside within the defined geographic area or service area of the public authority.

{¶ 7} In enacting the statute, the General Assembly referenced the right of an individual to choose where to live and Article II, Section 34, by recognizing the following:

(A) The inalienable and fundamental right of an individual to choose where to live pursuant to Section 1 of Article I, Ohio Constitution ;
(B) Section 34 of Article II, Ohio Constitution, specifies that laws may be passed providing for the comfort, health, safety, and general welfare of all employees, and that no other provision of *983the Ohio Constitution impairs or limits this power, including Section 3 of Article XVIII, Ohio Constitution.

2016 Ohio H.B. No. 180, Section 3.

{¶ 8} The General Assembly also indicated that the statute was enacted to address a matter of statewide concern and to provide for the general welfare of all employees:

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Related

Cleveland v. State (Slip Opinion)
2019 Ohio 3820 (Ohio Supreme Court, 2019)

Cite This Page — Counsel Stack

Bluebook (online)
90 N.E.3d 979, 2017 Ohio 8882, Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-of-cleveland-v-state-ohctapp8cuyahog-2017.