Legislative Update: Bill Seeks to Enhance Accountability, Transparency of Councils of Governments

By Dave Yost, Ohio Auditor of State

Wednesday, August 1, 2018

Legislation approved by the Ohio Senate in April seeks to improve accountability of the state’s Councils of Governments (COGs) and give my office authority to force the consortiums to make their existence known.

A COG is a collection of governments that organize to perform a specific function such as insurance pooling, cooperative energy buying or advocacy functions. They are an effective and efficient way for local governments to pool resources, share services and lower costs. 

My office is responsible for auditing these groups, but some have operated without our knowledge because there is currently no penalty for failing to notify the state of their existence. Senate Bill 239 aims to remedy this flaw by prohibiting COGs from taking any legally binding action, other than formation, until they register with my office. 

As of January, 131 active COGs had alerted us to their presence. One of them, a health care cooperative formed to lower insurance costs for its 158 members – including 86 townships – registered with my office in 2017 despite it being in operation since 2013.

By August of 2017, financial mismanagement had sunk the COG into a $12 million deficit, prompting many of its members to attempt to withdraw and seek insurance coverage elsewhere. However, the COG deployed every roadblock at its disposal to prevent its members from doing so, sparking a number of legal battles across the state. 

Had my office known about this COG sooner, we could have audited its books and provided guidance to correct its course and get it back into the black. Moving forward, the increased transparency achieved by Senate Bill 239 will help prevent similar scenarios and allow us to better protect the interests of local governments that unite to form COGs.

Additional measures in the bill seek to:

  • Prevent officers from asserting the trade secret exception to the Public Records Act to avoid disclosure of public documents (such as the names of the member government entities).
  • Prevent officers and employees of a COG from asserting sovereign immunity when they are not public officials and are operating the enterprise, should they commit an ethics violation due to their participation or relationship with the COG.
  • Make COG members who are not public officials subject to Ohio’s ethics laws, but not the financial disclosure provisions of the ethics laws.

Senate Bill 239, sponsored by Sen. Matt Dolan, awaits its first hearing in the House State and Local Government Committee. I encourage all members of COGs to monitor the progress of the bill through the Ohio Township Association and on ohioauditor.gov.

As always, my office’s legislative team is available to address any questions or concerns you may have. They can be reached by phone at (614) 466-4490 or email at ContactUs@ohioauditor.gov.

This article was first published in the Ohio Township Magazine.