A lawsuit filed Tuesday by the City of Cleveland challenges the constitutionality of a new law banning local hiring quotas that took effect earlier this year. The lawsuit filed in Cuyahoga County Common Pleas Court, alleges that the law (HB 180) is a violation of home rule authority granted by the state’s constitution.
The bill was signed into law by Governor John Kasich on May 31, and will take effect Aug. 31.
Home Rule Authority is granted under the Ohio Constitution, and gives Ohio cities the power of local self-government. Because these powers originate in the Constitution, laws passed that interfere with them may be invalid.
The City of Cleveland argues that the new law overrides home rule authority of a 2003 ordinance that requires 20% of taxpayer-funded construction hours to go to city residents. It also requires that 4% of those hours are worked by low-income residents.
According to the lawsuit, since 2013, this residence requirement has allowed Cleveland residents to work 897,870 hours on taxpayer funded construction projects, earning more than $34 million in wages. More than 100,000 of these hours were worked by low-income city residents.
A workforce residency requirement ensures that local wages stay local, to help stimulate the economy. Unscrupulous contractors often attempt to import labor from other states in an effort to undercut the local price market, which harms local workers and businesses.
In a quote to the American Institute of Architects Ohio, Representative Alicia Reece (D-Cincinnati) stated “Local hiring standards have been an effective tool to push back against the high unemployment that plagues too many minority communities in our urban cores…For the state to take away tools that increase broad-based economic opportunity and increase our skilled workforce is unconscionable, but I applaud Cleveland leaders for fighting back against what is effectively taxation without participation.”
ACT Ohio will continue to monitor the constitutional challenge to this legislation.