In City of Reynoldsburg v. Pub. Util. Comm’n, Sup. (Slip Opinion No. 2012-Ohio-5270), the Supreme Court of Ohio has provided another apparent limit to the Home Rule authority of Ohio municipalities.  The Court held that an electric utility’s tariff imposing fees on a political subdivision for relocating utility-owned infrastructure in a public right-of-way superseded a local ordinance imposing relocation fees on the utility.  In reaching this result, the Court reasoned that because the Public Utilities Commission of Ohio (“PUCO”) is established by a law of general application the electric utility company’s tariff was also a law of general application.  The Court rejected arguments that the local ordinance was within the authority granted to local government and further rejected arguments that a tariff provision, approved by the PUCO but drafted by the utility company, was not a law of general application.

The City of Reynoldsburg had passed an ordinance requiring utility providers which placed utility infrastructure within the public right-of-way to pay for relocation of such infrastructure if required by a major street renovation.  The applicable AEP tariff included a conflicting provision requiring the municipality to cover these relocation expenses.  In holding that the tariff provision took precedence over Reynoldsburg’s ordinance, the Court’s decision resulted in substantial additional street construction costs borne by the municipality.  As a practical matter, cities considering reconstruction should factor additional relocation expenses into their construction costs when planning street reconstruction if the utilities with infrastructure in the right of way have a similar tariff provision.

Read broadly, the decision can be interpreted to mean that any submission approved by an administrative agency constitutes a law of general application, so long as the agency approving the submission is established by a law of general application.  In any event, the decision further derogates the power of a municipal entity to regulate its right-of-ways, a power historically considered a core power of local self-government.  The case is particularly disappointing to proponents of local self-government and may be indicative of a desire by the Court to limit Home Rule authority generally.