By Rayan F. Coutinho

Gross income means all income from whatever source derived, including compensation for services.  It includes income realized in any form, i.e., money, property, or services. If compensation for services is paid in the form of property, the fair market value of the property must be included in income.  Consequently, the value of those lodgings is includable in a taxpayer’s gross income unless specifically excludable under another provision of the Code.  Section 119 provides in relevant part as follows: “SEC. 119. MEALS OR LODGING FURNISHED FOR THE CONVENIENCE OF THE EMPLOYER. There shall be excluded from gross income of an employee the value of any meals or lodging furnished to him by his employer for the convenience of the employer, but only if – *** (2) in the case of lodging, the employee is required to accept such lodging on the business premises of his employer as a condition of his employment. In determining whether meals or lodging are furnished for the convenience of the employer, the provisions of an employment contract or of a State statute fixing terms of employment shall not be determinative of whether the meals or lodging are intended as compensation.”

In order to avail himself of the exclusion provided thereby, a taxpayer must satisfy all three of the criteria set forth in section 119; i.e., (A) the lodgings must be furnished for the convenience of the employer, (B) on the business premises of the employer, and (C) the employee is required to accept the lodgings as a condition of his employment.  Failure to establish any one of these criteria suffices to preclude application of section 119.

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In 1986, California adopted an initiative known as Safe Drinking Water and Toxic Enforcement Act, still known by its original name of Proposition 65. Put simply, Proposition 65 requires businesses to notify Californians about significant amount of chemicals in the products they purchase, in their homes or workplaces, or that are released into the environment. In our client’s case, it is a product. The following are exempt from the provisions of Proposition 65: (1) businesses with less than 10 employees and (2) government agencies. A business is required to provide a “clear and reasonable” warning before knowingly and intentionally exposing anyone to a “listed” chemical.” This warning can be given by a variety of means, including by labeling.

The “list” contains a wide range of naturally occurring and synthetic chemicals that are known to cause cancer or birth defects or other reproductive harm. There are 4 ways a chemical gets on the list: (1) when California’s experts, namely, the Carcinogen Identification Committee (CIC) and Development and Reproductive Toxicant (DART) Identification Committee say so; (2) when an organization designated as an “authoritative body” by the CIC or DART says so; (3) when an agency of the state or federal governments requires such labeling e.g. prescription drug warnings required by U.S. FDA; and (4) if the chemical is identified in the California Labor Code as causing one of the above listed harms.

Due to bandwidth limitations, I am unable to post entire articles for download. Please email me at rfcoutinho@woodlamping.com with a request for a complete copy of this article.

Please contact Rayan Coutinho at rfcoutinho@woodlamping.com for complete details about the legal services offered by Wood & Lamping LLP.

The issue discussed in this article is whether a 2-0 vote of a board of trustees of an Ohio township where the third member is absent due to illness constitutes the “unanimous vote of the board”? This question was addressed in by the Ohio Attorney General in Opinion 99-004 and 85-010. A board of township trustees is a public body, which must take official action and conduct deliberations upon official business at open meetings, except as otherwise provided by law.

It has been found, under Ohio law, that all members of a board of township trustees must be notified of a meeting of the board, but that a majority of the board – that is, two of the three members – constitutes a quorum that is qualified to take action on behalf of the board. Therefore, if two or three trustees are present at a meeting, there is a quorum.

According to the Ohio Attorney General, the majority of a quorum may act for a board, provided that all members had notice and an opportunity to be present. See In re Slavens; State ex rel. Green v. Edmondson, 12 Ohio N.P. (n.s.) 577 (C.P. Hamilton County 1912) (on seven-member building commission, four members could act by majority vote if three members refused to attend or to vote, except when statute required affirmative vote of five members); 1998 Op. Att’y Gen. No. 98-007; 1965 Op. Att’y Gen. No. 65-70. With respect to a three-member board, however, two members may be a quorum, but a single member does not constitute a majority (i.e., more than half) of the quorum. Therefore, two members must act, whether two or three members are present. Under this rule, two or three of the township trustees must be present and voting in order for the board to take action. If only two members vote, they must concur in order for the board to act. See, e.g., State ex rel. Saxon v. Kienzle; 1976 Op. Att’y Gen. No. 76-022; see also State ex rel. Dry Ridge Dev. Co. v. Hamilton County Bd. of Comm’rs, 30 Ohio App. 3d 217, 507 N.E.2d 438 (Hamilton County 1986); 1934 Op. Att’y Gen. No. 2292, vol. I, p. 164. See generally Federal Trade Comm’n v. Flotill Products, Inc., 389 U.S. 179 (1967); 1998 Op. Att’y Gen. No. 98-007; 1992 Op. Att’y Gen. No. 92-047; 1978 Op. Att’y Gen. No. 78-047.

It has also been concluded that, if one member of the board of township trustees abstains from acting on a particular matter because of a conflict of interest, the remaining two members may take action on behalf of the board and, if they agree, their action may be considered the unanimous vote of the board. See 1985 Op. Att’y Gen. No. 85-010; see also State ex rel. Dry Ridge Dev. Co. v. Hamilton County Bd. of Comm’rs (reaching same conclusion with respect to board of county commissioners). But see 1934 Op. Att’y Gen. No. 2292, vol. I, p. 164 (citing instances in which requirement of a unanimous vote meant that the votes of all three township trustees were required). This conclusion is based on the principle that a unanimity requirement does not necessarily mean that all members must vote for a proposition, but it may require only “that those who vote on the proposition vote in agreement and that no one dissents.” 1985 Op. Att’y Gen. No. 85-010, at 2-38; cf. Seyler v. Balsly, 5 Ohio Misc. 210, 210 N.E.2d 747 (C.P. Hamilton County 1965) (finding that a vote by two members of a board of county commissioners satisfied the requirement of R.C. 303.12 that denial of a recommendation of the county rural zoning commission be by unanimous vote of the board when the third member was absent on leave and not voting). Under this principle, if one member of a board of township trustees abstains from voting and the other two concur, the vote is a unanimous vote (and, thus, also a majority vote).

Please note that the Attorney General limited its rationale in OAG 99-004 to a township that has not adopted the limited self-government form of township government pursuant to R.C. Chapter 504. Absent anything to the contrary in Chapter 504, we do not find any reason to believe that the same reasoning would not apply to all townships.

Please note that there is however, a subtle twist depending on the statutory language and may not be true in every instance. This analysis is limited to R.C. §519.12 due to the language used for unanimity. The Hamilton County Court of Common Pleas in Seyler et al v. Balsly. Inspr., et al., 210 N.E.2d 747 (1965) noted this distinction as follows:

“That where the requirement is for a unanimous vote of ‘all of the members or the body,’ or ‘of all those elected or appointed’ as members thereof, or some such impelling words, then [an affirmative vote of all members of the body is required]; but that where the requirement is *** that there shall ‘be a unanimous vote’ of the body, then the declared rule is that the requirement is satisfied if a quorum is present and the action taken is approved by all of the members present.”

Please contact Rayan Coutinho at rfcoutinho@woodlamping.com for complete details about the legal services offered by Wood & Lamping LLP.

By Rayan F. Coutinho, Ph.D.

§121.22(C) mandates that “[a]ll meetings of any public body are declared to be public meetings open to the public at all times.” §121.22(G)(1) creates an exception to the open meetings requirement. It provides: “*** the members of a public body may hold an executive session only after a majority of a quorum of the public body determines, by a roll call vote, to hold an executive session and only at a regular or special meeting for the sole purpose of the consideration of any of the following matters: (1) To consider the appointment, employment, dismissal, discipline, promotion, demotion, or compensation of a public employee or official or the investigation of charges or complaints against a public employee, official, licensee or regulated individual, unless the public employee, official, licensee or regulated individual requests a public hearing.”

That section continues to state that “If a public body holds an executive session pursuant to division (G)(1) of this section, the motion and vote to hold that executive session shall state which one or more of the approved purposes listed in division (G)(1) of this section are the purposes for which the executive session is to be held, but need not include the name of any person to be considered at the meeting.” (emphasis added). Thus, the statute explicitly authorizes the council of a municipal corporation to enter into executive session to discuss personnel matters without specifying the name of the person(s) during the motion or vote to hold that executive session.

Please contact Rayan Coutinho at rfcoutinho@woodlamping.com for complete details about the legal services offered by Wood & Lamping LLP.

H.B. 134 was passed by the Ohio Senate on 06-27-2007. It authorizes alternative standards for the election of directors of business corporations. It requires that conversions of domestic corporations into other business entities and conversions of other business entities into domestic corporations be permitted by the Revised Code chapter or by the laws under which the converting entities will exist. It also allows a limited liability company to provide in its operating agreement or its articles of organization for the exercise of the rights of a member who dies or becomes incompetent for the purpose of settling the member’s estate or administering the member’s property. It extends the shield of a partner of a registered limited liability partnership from personal liability for the obligations of the partnership. Finally, it validates meetings and votes of nonprofit corporations held by authorized telecommunications equipment on and after August 19, 2005.

Click here for the complete article. Please contact Rayan Coutinho at rfcoutinho@woodlamping.com for complete details about the legal services offered by Wood & Lamping LLP.

By John W. Eilers, Esq.

Trading stocks for a profit is anything but an exact science. Mathematics, however, can be applied to help the investor/trader analyze the opportunity presented and the cost of the decision to sell one security and to buy another. That cost the sale of an appreciated investment is made up of four measurable factors: Capital Gains Taxes; State Capital Gains Taxes; Broker’s Commission; Trading spread (mark down). Taxes and commissions reduce the funds available for reinvestment and so the investor must do better with less money in the next investment. The goal here is to define how much less will be available for reinvestment, and how much better than the prior investment the new investment must increase in value for the investor contemplating the trade to break even. Click here for the complete article. Please contact Rayan Coutinho at rfcoutinho@woodlamping.com for complete details about the legal services offered by Wood & Lamping LLP.

Both the United States and Ohio constitutions limit the government’s power of eminent domain to situations where the property is being taken for a public use and the owner is compensated (United States Const., Amend. 5; Ohio Const., Art. I, sec. 19). In Kelo v. City of New London (2005), 125 S.Ct. 2655, the United States Supreme Court held that economic development was a legitimate public use and authorized the taking of private property in an area that was economically depressed, but not blighted, in order to give it to another private entity for purposes of economic development. Kelo noted, however, that individual states were free to enact legislation to further restrict the exercise of eminent domain.

In response to Kelo, the 126th General Assembly created the Legislative Task Force to Study Eminent Domain and its Use and Application in the State (hereinafter “task force”). The task force was instructed to study the use of eminent domain and its impact on the state, how the decision in Kelo affects state law governing the use of eminent domain, and the overall impact of laws governing the use of eminent domain on economic development, residents, and local governments. The task force included members of the House and Senate, representatives from executive branch agencies, local government representatives, and advocates for developers and property owners. (Sections 3 and 4 of Am. Sub. S.B. 167 of the 126th General Assembly.) The task force issued its final report on August 1, 2006.

In addition to creating the task force, Am. Sub. S.B. 167 placed a moratorium on any public body using eminent domain to take private property that is not in a blighted area, without the consent of the owner, when the primary purpose for the taking is economic development that will result in ownership of the property being vested in another private person. This moratorium did not apply if the property was to be used for streets, roads, walkways, paths, or other ways open to public use, public utilities, common carriers, public parks or recreation areas, or government buildings or grounds. If an agency violated the moratorium, it could lose state funding for the project. The moratorium expired on December 31, 2006. (Section 2 of Am. Sub. S.B. 167.)

Shortly before the task force issued its final report, the Ohio Supreme Court issued an opinion in City of Norwood v. Horney (2006), 110 Ohio St.3d 353, that interpreted the Ohio Constitution to provide greater protections for property rights than under the Kelo decision. In Norwood, the court held that an economic benefit to the community is not enough on its own, absent any other public benefit, to satisfy the public-use requirement. The court also struck down the City of Norwood’s definition of blight as unconstitutionally vague because it included “deteriorating” areas, a classification that the court found improperly relies on speculation as to the future condition of the property. Although the task force was unable fully to evaluate the implications of the Norwood decision, its final recommendations incorporate the major holdings of that decision.

Prior law contained multiple definitions of blighted areas and slums that were similar to, but not necessarily consistent with, each other. The laws authorizing counties to conduct renewal projects (R.C. 303.26 to 303.59) contained nearly identical definitions of blight and slum. “Blighted area” was defined as an area that substantially impaired or arrested sound growth, retarded the provision of housing accommodations, or constituted an economic or social liability and was a menace to the public health, safety, morals, or welfare in its present condition and use because of the presence of a substantial number of slum, deteriorated, or deteriorating structures, predominance of defective or inadequate street layout, faulty lot layout in relation to size, adequacy, accessibility, or usefulness, unsanitary or unsafe conditions, deterioration of site or other improvements, diversity of ownership, tax or special assessment delinquency exceeding the fair value of the land, defective or unusual conditions to title, or the existence of conditions which endanger life or property by fire and other causes, or any combination of such factors. “Blighted area” also included a disaster area in need of redevelopment or rehabilitation as certified by the county commissioners and the governor. “Slum area” was defined as an area that was conducive to ill health, transmission of disease, infant mortality, juvenile delinquency, or crime, and was detrimental to the public health, safety, morals, or welfare because it contained a predominance of buildings or improvements, whether residential or nonresidential, that suffered from dilapidation, deterioration, age or obsolescence, inadequate provisions for ventilation, light, air, sanitation, or open spaces, high density of population and overcrowding, or the existence of conditions which endanger life or property, by fire and other causes, or any combination of such factors. (R.C. 303.26(D) and (E); 303.36–not in the act.) A county that was conducting a renewal project to address blight or slum conditions was specifically authorized to exercise eminent domain (R.C. 303.37(C), 303.38–not in the act).

The laws authorizing the creation of community urban redevelopment corporations defined “blighted area” as an area containing a majority of structures that have been extensively damaged or destroyed by a major disaster, or that, by reason of dilapidation, deterioration, age or obsolescence, inadequate provision for ventilation, light, air, sanitation, or open spaces, unsafe and unsanitary conditions or the existence of conditions which endanger lives or properties by fire or other hazards and causes, or that, by reason of location in an area with inadequate street layout, incompatible land uses or land use relationships, overcrowding of buildings on the land, excessive dwelling unit density, or other identified hazards to health and safety, are conducive to ill health, transmission of disease, juvenile delinquency and crime and are detrimental to the public health, safety, morals, and general welfare (R.C. 1728.01(E)). A project undertaken by a community urban redevelopment corporation could include the acquisition of blighted property “by purchase or otherwise” (R.C. 1728.01(F)(2)).

The laws authorizing metropolitan housing authorities to operate housing projects defined “slum area” as any area where dwellings predominate which, by reason of dilapidation, overcrowding, faulty arrangement or design, lack of ventilation, light, or sanitary facilities, or any combination of these factors, are detrimental to safety, health, or morals (R.C. 3735.40(B)). Metropolitan housing authorities are authorized to use eminent domain to conduct housing projects in slum areas (R.C. 3735.31(B)–not in the act). Prior law authorized municipal corporations to appropriate and rehabilitate buildings or structures that they found to be a threat to the public health, safety, or welfare, that had been declared to be a public nuisance, and that either had been found to be insecure, unsafe, structurally defective, unhealthful, or unsanitary or violated a building code or ordinance (R.C. 719.012). Continuing law also authorizes “impacted cities” to use eminent domain for purposes of economic development (R.C. 719.011–not in the act). “Impacted cities” are cities that have been extensively damaged by a major disaster and declared to be a major disaster area under federal law, or cities that have attempted to cope with the problems of urbanization, and that provide for economic development by either authorizing the construction of housing by a metropolitan housing authority or adopting a program to combat blight and slums that has been certified as workable by the director of development (R.C. 1728.01(C)).

The act replaces all of these definitions with a single set of definitions that are applicable throughout the Revised Code except for Chapter 725. (municipal urban renewal). The act defines “blighted area” or “slum,” as used in the Revised Code, as an area in which at least 70% of the parcels are blighted parcels and those blighted parcels substantially impair or arrest the sound growth of the state or a political subdivision of the state, retard the provision of housing accommodations, constitute an economic or social liability, or are a menace to the public health, safety, morals, or welfare in their present condition and use (R.C. 1.08(A)).

For a complete analysis, please click here. Please contact Rayan F. Coutinho at (513) 852-6030 to learn how Wood & Lamping LLP’s Zoning and Public Sector Group can help your municipal corporation or township. We represent numerous communities in the tri-state area in various capacities, including as law directors and external counsel.

On December 4, 2007, Governor Ted Strickland signed H.B. 50. State Representative Clyde Evans sponsored HB 50, which allows townships to remove junk motor vehicles from public and private property, and to borrow money to pay for removal of junk motor vehicles and other debris from private property.

Old township law authorized townships to regulate the storage but not to undertake the removal of junk motor vehicles within the unincorporated territory of the township. A “junk motor vehicle” was defined as a motor vehicle that is three model years old or older, is apparently inoperable, and is extensively damaged, including, but not limited to, missing wheels, tires, engine, or transmission.

The new law authorizes a board of township trustees to provide, by resolution, for the removal of any vehicle in the unincorporated territory of the township that it determines is a junk motor vehicle–using the same definition of “junk motor vehicle” as is used in the Township Law explained above. If the junk motor vehicle is on public property, the board may provide for its immediate removal; if the junk motor vehicle is on private property, the board may provide for its removal not sooner than 14 days after the board serves written notice of its intention to have the vehicle removed on the owner of the land and any holders of liens of record on the land. This includes any collector’s vehicle that is a junk motor vehicle, subject, however, to the special rules applying to township regulation of collector’s vehicles, which are explained above. (R.C. 505.871(A), (B), (C)(1), (F), and (G)(2).)

For a complete analysis, please click here. Please contact Rayan F. Coutinho at (513) 852-6030 to learn how Wood & Lamping LLP’s Zoning and Public Sector Group can help your municipal corporation or township. We represent numerous communities in the tri-state area in various capacities, including as law directors and external counsel.

By Rayan F. Coutinho, Esq.

On June 30, 2000, Congress enacted the federal Electronic Signatures in Global and National Commerce Act (“E-SIGN”). E-SIGN eliminated some of the legal barriers to the use of electronic technology to form and sign contracts, collect and store records, and send and receive various types of notices and disclosures. E-SIGN provides that no contract , signature, or record shall be denied legal effect solely because an electronic signature or record was used in its formation.

Many states, including Ohio have enacted electronic signature legislations as well. For example, Ohio Revised Code §1306.06 provides as follows: “(A) A record or signature may not be denied legal effect or enforceability solely because it is in electronic form; (B) A contract may not be denied legal effect or enforceability solely because an electronic record was used in its formation; (C) If a law requires a record to be in writing, an electronic record satisfies the law; (D) If a law requires a signature, an electronic signature satisfies the law.”

The Sixth Circuit has made it clear in the context of electronic communications: “[c]onsidering the advancement and ubiquity of electronic corporate communications, we will not induce a return to older practices by imposing a paper receipt requirement.” Rather than reproducing the facts and holdings of the cases, here are some of the general principles and tips derived from cases, articles and treatises that you may use when sending the employment handbook to employees by email:

It appears that some of the cases turn on the issue of notice. So sending a mass email without more may be subject to litigation because it is arguably inadequate to meet the minimal level of notice required.

If an employer chooses to communicate an employment related policy such as an employment handbook or arbitration policy, the employer should consider communicating the policy more than once via email.

An employer should consider circulating a paper copy to employees, similar to a business magazine or newspaper that is circulated around the office and having them put a check mark or initials on a sheet attached to the front cover of the handbook.

An employer may also post a copy of the policy in various common areas.

Do not include terms of the policy in the body of the email itself or in a series of links. Send it as an attachment and clearly state in the body of the email what the attachment is.

An electronic acknowledgment of a policy is more likely to be held valid if it is abundantly clear from the language of the policy itself that electronically agreeing or “click-acknowledging” constitutes “acceptance” of the policy.

Employers should specifically seek an electronic acknowledgment that the affected employees have “read, understood and agree to abide by the electronic policy.” – Employers may use a “click-on” tool that asks employees to mark a box to indicate that they have read, understood and accepted the policy. If an employer is using the “click-on” method of acknowledgement, the employer should maintain records of these “click-on” acknowledgments and follow up with employees who have not taken any affirmative steps to “click-on.”

Please contact Rayan Coutinho at rfcoutinho@woodlamping.com for complete details about the legal services offered by Wood & Lamping LLP.

On June 25, 2007, Governor Strickland signed Senate Bill 117, which created a new state-issued video-authorization process to replace the local franchise process. Prior to the effective date of the law, a company that intended to provide video service had to obtain a local video service franchise from each municipality or township.

Municipal corporations and townships had the authority, pursuant to federal cable law (47 U.S.C. §§521-615(b)) that empowers governmental “franchising authorities” and to state law (respectively, Section 3, Article XVIII, Ohio Constitution; and R.C. 505.90 to 505.92(repealed by Senate Bill 117) that empowers municipal corporations and townships to authorize service within their jurisdictions.

Under the law signed by Governor Strickland, video-service providers may apply for a state-issued authorization known as a “Video Service Authorization” (VSA) from the Director of Commerce at the Ohio Department of Commerce which is the new statewide franchising authority. Am. Sub. S.B. 117 (Effective Date – September 24, 2007) allows existing municipal and township franchises and competitive video service agreements to continue until their scheduled expiration; prohibits the renewal or extension of those franchises or agreements; and allows a person to apply for a VSA when its current franchise or agreement expires or (1) after another person provides or sells video service in the incumbent’s area, (2) after the incumbent receives notice that a Video Service Provider (VSP) will begin to provide or sell service in that area, or (3) after the FCC determines under federal law (47 C.F.R. 76.907) that the incumbent is subject to effective competition in the area as defined in that law (47 C.F.R. 905(b)).

For complete analysis of the bill, please click here.

Please contact Rayan Coutinho at rfcoutinho@woodlamping.com for complete details about the legal services offered by Wood & Lamping LLP.