In the transportation appropriation bill the Ohio General Assembly passed one section created stringent rules for obtaining a construction equipment auction license. The rules were so stringent, only one company operating in Ohio — Ritchie Bros. Auctioneers — met all of the requirements.

One requirement is maintaining  a permanent auction site in Ohio that is at least 90 acres in size and also maintaining more than 60,000 square feet of total facility space. Another is to receive more than $1 million in gross annual sales in Ohio.

When the bill first passed in March, auctioneering companies that were impacted did not know it had happened. They were not contacted, asked to testify nor given an opportunity to protest.

The Ohio Auctioneers Association (OAA) members started contacting their elected representatives after learning of the bill’s passage. Few legislators were aware that HB 114 created a monopoly for Ritchie Bros. OAA obtained legal advice that included the opinion that this section of HB 114 violated the Ohio Constitution’s uniformity clause and could be struck down as unconstitutional if challenged.

Canadian-owned Ritchie Bros. is the largest auctioneer operation in Ohio. It employs two legislative lobbyists. This isn’t just about one giant corporation trying to eliminate all of its competition through legislation. The auction issue is also one that involves the Ohio Auto Dealers Association, which has its own lobbyists and does not want construction equipment auctioneers to sell equipment that has a motor vehicle title.

HB 114 allows Ritchie Bros. to auction motor vehicles at its Columbus location as long as they only account for 10 percent of its gross annual sales revenue in Ohio.

A local company impacted by this is Yoder & Frey Auctioneers. Its general manager, Dan Pletcher, said he contacted his legislators, Rep. Barbara Sears and Sen. Mark Wagoner.

“Sears came out the day after the phone call. When we explained the impact of the bill and how our business plan operates, she appeared to get it,” Pletcher said. “She said she would see what she could do, then stopped returning my phone calls.”

Wagoner did not return his calls, Pletcher said.

When Toledo Free Press contacted Wagoner on June 15, he said Senator Cliff Hite had proposed to solve the issue by placing an amendment in HB 153. Sears was contacted, said she would comment on the issue, but did not respond by press time.

Pletcher said HB 153 does not repeal what was passed in HB 114, nor does it eliminate the concerns about unconstitutionality. It still allows one company, Ritchie Bros., to conduct auctions that other construction auction firms like Yoder & Frey would not legally be able to conduct in Ohio. OAA said HB 114 and HB 153 will impact more than half of the companies that do construction equipment auctions in Ohio.

“The public should be the ones that are angry, this will not allow them to get the best price for equipment or allow them options,” Pletcher said.  “They are giving a Canadian company the ability to do what they are not allowing any other Ohio company to do.”

Instead of a local company being able to sell or buy heavy equipment that would include dump trucks at a local auction, the local company could only sell construction equipment that did not have a motor vehicle title. You could buy or sell a backhoe, but not a dump truck. To sell all of your equipment you’d either have to take it out of state or go to the one auction location in Ohio where you could sell or buy both — Ritchie Bros.

Yoder & Frey have been in Northwest Ohio since 1964. Like a majority of auction operations, they are family owned and operated. HB 114 as passed and HB 153 as it is written will mean the company will have to seek more out-of-state auctions to survive as a business.

Members of OAA don’t want special treatment; all they want is to be allowed to compete fairly. They don’t have scores of lobbyists with powerful friends, but they should have been able to count on our elected representatives to read bills before passage. The General Assembly still has time to do the right thing — let’s hope they do it.

Toledo Free Press Web Editor Lisa Renee Ward operates the political blog GlassCityJungle.com.

Tags: Glass City Jungle, Lisa Renee Ward, Shredding the Curtain, State of Ohio

This entry was posted on Friday, June 17th, 2011 at 6:12 pm and is filed under Glass City Jungle, Opinion, Shredding the Curtain.
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