OML UPDATE AT-A-GLANCE

Here are the top four things you need to know from this past week:

·        This Wednesday, the Senate passed SB 375, which would distribute the remaining $650 million in federal CARES Act funds on a per capital basis to Ohio’s political subdivisions. The Legislative Service Commission (LSC) has prepared a spreadsheet detailing how much local governments could expect to receive under SB 357. You can access this spreadsheet HERE and read more in the article below.

·        The U.S. Department of Treasury has released an updated FAQ on the Coronavirus Relief Fund, which are the revenues earmarked by the CARES Act for local governments and that have been allocated to Ohio’s political subdivisions through HB 481 and the Controlling Board. This FAQ focuses on questions related to reporting and record keeping. It is currently ambiguous how these directions will be applied, and the National League of Cities (NLC) has released an explanation along with the document, which you can access HERE. Read more in the article below.

·        Ohio will receive $96 million in federal funding from the 21st Century CURES Act to help battle the ongoing opioid epidemic. The grant total received by Ohio is the third largest grant received by a state, surpassed only by California and Florida. Last year, Ohio received $55.79 million through the same legislation.   

·        This week, Ohio saw a decrease in applications for unemployment compensation from the previous week. According to the Department of Jobs and Family Services (ODJFS), 18,719 new jobless claims were filed this week, while 18,988 were filed the previous week. ODJFS has stated that it has paid more than $6.2 billion in unemployment compensation to over 795,000 Ohioans over the last 24 weeks.



CARES ACT DISTRIBUTION BILL PASSES SENATE AFTER COMMITTEE APPROVED AMENDMENTS

The League thanks the Senate for passing SB 375, which is sponsored by Sen. Dolan (R – Chagrin Falls) and would distribute the remaining $650 million in remaining CARES Act funds earmarked for local governments. The bill first passed the Senate Finance Committee and then full Senate by a unanimous vote on Wednesday. We also thank Sen. Dolan for sponsoring this bill and for his efforts to ensure local governments get the federal coronavirus relief they need.

The League, along with the County Commissioners Association of Ohio, the Ohio Mayors Association and the Ohio Township Association, submitted joint proponent testimony supporting the bill, stating that in order to “sustain Ohio’s locally implemented frontline response, available federal resources must be distributed to the local level where they can directly benefit Ohioans.” You can read the joint testimony in full HERE.

Before it was passed by the full Senate, several amendments were adopted into the bill. On amendment made several important changes, including changes to two important deadlines for local governments. One of the amendments moved the deadline for encumbering the funds from October 15 to November 20, and moved the deadline for returning all unencumbered funds to the state for the purpose of returning it to the federal government from December 28 to December 30.

Additional amendments shortened the timeframe for counties to redistribute funds to five days from seven and clarified issues surrounding when a municipality spans several counties. Another amendment clarified that a local government that has already passed a resolution to receive previous CARES Act funds do not have to pass another one, but that municipalities that have not passed such a resolution but wish to receive this distribution must pass a resolution. You can access all the adopted amendments HERE.

The full Senate reported out the bill unanimously. It must now pass the House before it can be sent to the Governor’s desk for his signature. It is currently unclear whether the House will return for session again before the November election. We urge our members to call their representatives and relate to them the importance of getting these funds distributed as quickly as possible. Even with the amended deadlines, municipalities do not have much time to encumber these funds before they need to be returned. We encourage local leaders to impress upon their members in the Ohio House the importance of passing SB 357 and ensuring local governments can continue to deliver the quality local services Ohioans deserve.
 

NLC DETAILS DIFFERENCES BETWEEN TREASURY’S OFFICE OF INSPECTOR GENERAL FAQ AND U.S. DEPARTMENT OF TREASURY FAQ

The Treasury’s Office of Inspector General and the U.S. Department of Treasury have both recently released FAQs regarding the federal Coronavirus Relief Fund (CRF) created within the CARES Act for local governments. The FAQs contain contradictory information.

Irma Esparza Diggs, Senior Executive and Director of Federal Advocacy for the National League of Cities (NLC), has provided an explanation of the conflicting information within the U.S. Treasury Department’s latest Coronavirus Relief Fund (CRF) FAQ, which you can access HERE, and the Treasury’s Office of Inspector General’s FAQ, which is attached in the bullet point above. Irma’s explanation is below:

The Treasury’s Office of Inspector General (OIG) issued a new set of Frequently Asked Questions (FAQs) on August 28, 2020. Days later, September 2, 2020, the Treasury Department updated their Coronavirus Relief Fund (CRF) Guidance, a separate document from the Department’s FAQs and from the Department’s OIG’s FAQs.

The FAQs from the OIG’s office run counter to Treasury’s FAQs. (For reference, The Office of Inspector General is housed within Treasury but is independent of Treasury.)

The Treasury Department’s FAQs read as follows:

2. “The Guidance says that funding can be used to meet payroll expenses for public safety, public health, health care, human services, and similar employees whose services are substantially dedicated to mitigating or responding to the COVID-19 public health emergency. How does a government determine whether payroll expenses for a given employee satisfy the “substantially dedicated” condition?

The Fund is designed to provide ready funding to address unforeseen financial needs and risks created by the COVID-19 public health emergency. For this reason, and as a matter of administrative convenience in light of the emergency nature of this program, a State, territorial, local, or Tribal government may presume [underline added for emphasis] that payroll costs for public health and public safety employees are payments for services substantially dedicated to mitigating or responding to the COVID-19 public health emergency, unless the chief executive (or equivalent) of the relevant government determines that specific circumstances indicate otherwise.”

The OIG’s FAQs reinterprets the key term: “may presume” in question 69(a).

The OIG’s FAQs question number 69 and 69(a) read as follows:

69) “To what level of documentation will a government be held to support the reimbursement of public safety payroll that was "presumed" to be substantially dedicated to mitigating the emergency?

The recipient of CRF payments must maintain and make available to Treasury OIG upon request, all documents and financial records sufficient to establish compliance with subsection 601(d) of the Social Security Act, as amended (42 U.S.C. 801(d)). Documents/records include payroll records and documentation that support an employee’s time dedicated to mitigating the COVID-19 health emergency for the covered period March 1 through December 30, 2020. Records include, but are not limited to (1) general and subsidiary ledgers used to account for the receipt of CRF payments and subsequent disbursements; and (2) payroll, time, and human resource records to support costs incurred for payroll expenses related to addressing the COVID-19 health emergency. Please refer to the Treasury OIG memorandum, Coronavirus Relief Fund Reporting and Record Retention Requirements (OIG-20-021; July 2, 2020).
 
69(a) “Will government have to demonstrate/substantiate that an employee's function/duties were in fact substantially dedicated to mitigating the emergency?

Yes, through documentation and financial records as defined above and any other documents/records that support employee’s function/duties and/or time was substantially dedicated to mitigating the COVID-19 emergency.”

The “may presume” position taken by the Treasury in earlier and the current FAQ is essentially superseded by the new burden of 69(a) to demonstrate and substantiate that an employee was substantially dedicated to mitigating the emergency. Governments had been relying on “may presume” language in the FAQs for months in the absence of Guidance from the Treasury.

On a separate point, Treasury’s updated Guidance document appears to align the OIG’s and Treasury Guidance positions. The updated Guidance says: “The full amount of payroll and benefits expenses of substantially dedicated employees may be covered using payments from the Fund.” The Guidance continues on: “The relevant unit of government should maintain documentation of the ‘substantially dedicated’ conclusion with respect to its employees.”

Thus, the Treasury’s Guidance and the OIG’s FAQs both require documentation to prove that an employee’s time was ‘substantially dedicated’. The OIG’s requirements, however, are going to be more onerous. Therefore, it appears the Treasury’s Guidance and its own FAQ (separate from the OIG’s FAQs) stand at odds with each other. The “may presume” doctrine of question two in Treasury’s FAQs is at odds with “The relevant unit of government should maintain documentation of the ‘substantially dedicated’ conclusion with respect to its employees” from the Guidance.

This is a very confusing situation with many contradictions, but NLC is working hard to try to sort through it.

What Is NLC Doing
NLC is taking the lead in drafting a letter to the OIG’s office about this issue in conjunction with other relevant state and local organizations.

The League will keep our members apprised as this issue progresses.



OHIO CORONAVIRUS RESPONSE UPDATE

·        As of Thursday afternoon, Ohio is reporting 127,112 cases of coronavirus, 4,226 deaths, 13,663 hospitalizations and 3,003 ICU admissions.
  
·        In advance of the upcoming Labor Day holiday, Governor DeWine reminded citizens to take safety precautions when celebrating with others outside of their households. Governor DeWine encourages citizens to continue regular hand-washing, social distancing, and disinfecting. The mask mandate in Ohio remains in effect for all 88 counties.

·        Governor DeWine released this week's Ohio Public Health Advisory System map, which you can access HERE. New health data compiled by the Ohio Department of Health indicates that seven counties currently have a very high risk of exposure and spread. A total of 67 counties stayed at the same level as last week, and 12 counties moved from orange to yellow. There are now a total of 39 counties in the yellow level, the highest number since July 2.

Water and Wastewater Infrastructure Updates:

·        Information from Ohio's new Coronavirus Wastewater Monitoring Network is now available at coronavirus.ohio.gov. The network was developed to help mitigate the spread of COVID-19 through the study of wastewater samples.

  • Governor DeWine announced that Greater Cincinnati Water Works will receive $725,000 in H2Ohio funding from the Ohio Environmental Protection Agency to remove and replace lead service lines and fixtures at nearly 200 child care facilities in Cincinnati. The H2Ohio initiative launched last year to address a number of water quality issues in Ohio including lead pipes feeding into childcare centers.
 
Local Health Departments:
 
·        Beginning Tuesday, September 15, and each Tuesday thereafter, local health departments will report the number of newly reported and cumulative cases to the Ohio Department of Health. The Ohio Department of Health will publish this data by school or school district, including a breakdown by students and staff, each Thursday. The order will also require each school district or school to identify a COVID-19 coordinator to facilitate the reporting of case information, and upon request, schools or buildings are required to provide the local health department a copy of their pandemic plan.

Jobs and Employment Updates:
 
·        In an effort led by the Development Services Agency, the U.S. Department of Defense has made a commitment to Ohio’s defense manufacturers and put the state in a position to receive a $5 million grant to improve manufacturing processes and train workers for next-generation jobs.
 
Traffic Safety Initiatives:

·        Governor DeWine announced three new traffic-safety efforts aimed at reducing the number of fatalities on Ohio's roads and better ensuring that Ohio's young drivers have the necessary skills to safely navigate the streets:

o  Ohio Traffic Safety Council: The new council, led by the Ohio Department of Public Safety, will be composed of representatives of several state agencies and outside groups. The role of the council will be to coordinate and monitor all statewide traffic safety initiatives, analyze trends, and advise the Governor on creating safer roads through education, enforcement, engineering, and emergency response.

o  Work Zone Enforcement: Because enforcing traffic laws can be a challenge in work zones, the Ohio State Highway Patrol Aviation Unit, which already conducts speed checks from the air, will conduct targeted enforcement on crash-causing violations in Ohio Department of Transportation construction zones. The increased enforcement is in response to the nearly 9,000 work-zone crashes in Ohio between 2019 and 2020.

o  Juvenile Court Grants: Eight juvenile courts in Ohio have been awarded grant funding through the Ohio Department of Public Safety to help them provide young drivers more access to advanced driver training. Courts in Adams, Athens, Medina, Knox, Delaware, Miami, Fairfield, and Delaware counties will each receive $20,000 through Ohio's new Youthful Driver Safety Fund which was developed as part of Ohio's biennium budget.

·        The new traffic safety efforts are in addition to several other initiatives launched by Governor DeWine since 2019 including the creation of the Intersection Safety Program to improve the safety of 150 rural, urban, and suburban intersections across the state; the development of the "Ohio - Ready, Test, Drive!" program to help enhance the skills of new drivers; and the creation of several distracted driving corridors to reduce distracted driving in Ohio. Governor DeWine also worked with members of the General Assembly to introduce the Hands-Free Ohio bill, which is currently pending in the Ohio General Assembly, to strengthen Ohio's laws related to the use of wireless devices while driving.

Broadband Updates:

·        Over 900 grant requests have been approved for the K-12 Broadband Connectivity Grant to go towards hotspots and internet-enabled devices. This enables 121,000 students to gain high-speed internet in their homes, thanks to the devices provided by this grant based on information provided by the schools. In areas where there are barriers to take-home devices, the grant will also support the creation of new public wi-fi and mobile wi-fi spaces to help students connect to the internet. By the end of this week, schools will receive notifications of their final award and can begin the process of purchasing these items through the Ohio Department of Education and BroadbandOhio.

Education and Child Care Updates

·        Governor DeWine announced details for Ohio's forthcoming case reporting order for K-12 schools. Beginning Tuesday, September 8, parents or guardians and school staff should notify their school within 24 hours of receiving a positive test or a clinical diagnosis. Within 24 hours after receiving that notification, the school should notify other parents and guardians about that case in writing, providing as much information as possible without releasing protected health information. The school must also notify their local health department within 24 hours. 

  • As of last Tuesday, all child care providers in Ohio that serve publicly funded children were required to be rated on Ohio’s child care quality rating system, called Step Up To Quality. Today, over 4,400 providers are now rated through the system. This is more than double the number of rated quality child care providers when Governor DeWine took office in 2019. 


BILL IMPACTING MUNICIPALITIES PASSED BY SENATE

·        HB 606 – CIVIL IMMUNITY. Sponsored by Rep. Grendell (R - Chesterland), would grant civil immunity to a person who provides services for essential businesses and operations for injury, death, or loss that was caused by the transmission of COVID-19 during the period of emergency declared by Executive Order 2020-01D, issued on March 9, 2020, and declare an emergency. The bill was adopted by the Senate by a vote of 22-8 and now heads to the desk of Governor DeWine for his signature. The League is supportive of this legislation.



COMMITTEE UPDATE: BILLS OF MUNICIPAL INTEREST

Here are the bills impacting municipalities that received committee hearings this week:

·        SB 333 – TAX PAYMENTS. Sponsored by Rep. Schaffer (R – Lancaster), would require the Ohio Department of Natural Resources to make payments in lieu of taxes to local taxing units for significant land acquisitions by the department after 2018. During its second hearing before the Senate Agriculture and Natural Resources Committee, several local government organizations submitted proponent testimony, including the League. You can read the League’s testimony in full HERE.
·        HB 674 – LIQUOR LAWS. Sponsored by Rep. Hillyer (R – Urichsville), would revise specified provisions of the liquor control law and declare an emergency. During its second hearing before the Senate Agriculture and Natural Resources Committee, proponents testified in support of the bill, which expands alcohol sales through 11:59 on Sunday, among other provisions. The League supports this legislation.

·        HB 669 – ALCOHOL SALES. Sponsored by Rep. Swearingen (R – Huron) and Rep. LaRe (R – Violet Twp.), would enact provisions of law relative to the sale and delivery of alcoholic beverages by liquor permit holders and declare an emergency. During its second hearing before the Senate Agriculture and Natural Resources Committee, proponents of the bill testified in support of the bill, which enable the delivery of alcoholic beverages wile expanding to-go sales and enabling the expansion of liquor permit premises. The League is neutral on this legislation.

·        HB 614 – UNEMPLOYMENT COMPENSATION. Sponsored by Rep. Frazier (R - Newark) and Rep. Richardson (R - Marysville), would create the Unemployment Compensation Modernization and Improvement Council, revise the claims process and duties related to that process, require the Auditor of State to examine and make recommendations on the efficiency of the process, and require the Director of Job and Family Services to create a constituent referral system and a strategic staffing plan for employees who handle inquiries and claims for unemployment benefits. During its second hearing before the Senate Government Oversight and Reform Committee, Policy Matters Ohio testified in support of the bill. The League is neutral on this legislation.

·        SB 348 – HEALTH ORDERS. Sponsored by Sen. Schaffer (R – Lancaster) and Sen Roegner (R – Hudson), would local boards of health from using certain threatening words in notifications to the public, allow local boards of health to reject Department of Health orders during an emergency, allow health care professionals who serve on a board of health to receive continuing education credit, and change the makeup of local boards of health. During its first hearing before the Senate Health, Human Services and Medicaid Committee, the bill’s sponsors explained that the legislation grants options for how local health districts deal with pandemic or other periods of emergency. The League is still looking into this legislation.

·        SB 311 – HEALTH ORDERS. Sponsored by Sen. McColley (R – Napoleon) and Sen. Roegner (R – Hudson), would rescind certain orders of the Director of Health regarding COVID-19, require the approval of the Joint Committee on Agency Rule Review for Department of Health orders to be effective for more than fourteen days, require statewide Department of Health orders to include the Governor's signature, modify the Department's rulemaking authority, allow in-person high school graduation ceremonies, and declare an emergency. During its fifth hearing before the Senate Health, Human Services and Medicaid Committee, a substitute bill was adopted that, among other changes, prohibits statewide quarantine orders from applying to people that are not exposed to or diagnosed with a disease and allows the legislature to rescind orders via concurrent resolutions. The bill was then reported out of committee. The League is neutral on this legislation.

·        SB 16 – PEACE OFFICERS. Sponsored by Sen. Williams (D – Cleveland), is regarding instruction for peace officers, students, and new or student drivers on proper interactions with peace officers. During its fifth hearing before the Senate Judiciary Committee, no testimony was heard on the bill. The League is neutral on this legislation.



NEW LEGISLATION OF MUNICIPAL INTEREST

Here is a bill introduced this week that would impact municipalities:

·        HB 754 – REMOTE WORK TAX RULES. Sponsored by Rep. Jordan (R - Ostrander), would modify municipal income tax employer withholding rules for COVID-19-related work-from-home employees.
(Link: https://bit.ly/2R7PUyh)