Client Alerts

Update Concerning Cincinnati’s Bidding Requirements For MSD Construction Project

By: John M. Hands and Jesse R. Lipcius

About: Construction, Construction Litigation

This Client Alert updates Ulmer & Berne LLP’s May 2013 Client Alert: Cincinnati Changes Bidding Requirements Concerning Sewer District, Storm Water, and Water Works Construction Projects.

Efforts to repeal Cincinnati’s controversial “Responsible Bidder” Ordinance were recently rejected by Cincinnati City Council 5 to 4, with Democrats voting to dismiss a separate ordinance designed to repeal the Responsible Bidder Ordinance, and Republicans voting to keep the repeal ordinance in front of council. The Responsible Bidder Ordinance, which became effective last July, requires contractors who bid on Metropolitan Sewer District (“MSD”) construction projects with a value of $400,000 or more to employ apprentices from programs that have graduated at least one participant each of the past five years. Supporters of the ordinance assert the change will foster job growth and mentoring within the local construction industry. Opponents claim the law favors “union shops” that utilize such apprentice programs, and adds to project costs.

MSD must rebuild most of the sewer system as part of a court-monitored consent decree. Hamilton County Commissioners have halted most of the $3.2 billion, 15-year MSD project in protest over the Responsible Bidder Ordinance. Hamilton County owns MSD, but the City manages MSD and owns MSD’s city-based facilities. There is a risk that further delays to the MSD project could result in fines from the federal government.

While the Commissioners believe they, rather than City Council, set MSD policy, they have considered alternative proposals including aspirational inclusion goals, incentive programs and other ways to support apprenticeship programs. Members of City Council have stated they want to go through a non-binding mediation process with the County to resolve the dispute. If agreement is not reached, however, the Commissioners have indicated they are prepared to go to court.

For more information on the latest developments concerning the Responsible Bidder Ordinance, please contact John Hands, Jesse Lipcius, or another member of the Ulmer & Berne LLP Construction Team.