Ohio Mechanic's Liens on Public Improvement Projects or on Public LandsMechanic's Liens protect a contractor or material supplier's ability to get paid. There are a different set of rules for filing a mechanic's lien on public lands, a public improvement project, or generally a project paid for by public tax dollars, than there normally are for filing mechanic's liens.
Most of the time when there is someone not being paid on a public improvement project it is a subcontractor, material supplier, or someone who has a contract with a subcontractor. Ohio Revised Code section 1311.251 provides the framework for determining whether or not you can file a lien for furnishing materials to a public improvement project.
Notice of Commencement and Notice of Furnishing RequirementsOhio Revised Code Section 1311.252 provides that every public authority must prepare a Notice of Commencement prior to the performance of work or furnishing of materials to a public improvement project. This Notice is required to be made public, which is typically done by being filed in the local county Recorder's Office. Although the public authority is required to prepare a Notice of Commencement - they do not always do so.
If the public authority prepares and makes public a Notice of Commencement, then any contractor or material supplier must prepare and serve a Notice of Furnishing in order to be able to later file a mechanic's lien. If the public authority does not file a Notice of Commencement then no Notice of Furnishing has to be done. According to Ohio Revised Code 1311.261, a subcontractor or material supplier must serve a Notice of Furnishing on the principal contractor within 21 days after first performing work or providing materials on the project. There are some exceptions to who must provide a Notice of Furnishing and on the timeline, but in general it is better to be safe than sorry on providing a Notice of Furnishing and the timeline for doing so.
Filing the Mechanic's Lien - A Little Backwards Compared to Commercial or Residential ProjectsWhen it comes to filing a mechanic's lien for a public improvement project, the process is a little backwards compared to how it normally is for most mechanic's lien filings. Basically, you serve the public authority with a copy of the mechanic's lien before filing the lien on the local county Recorder's Office. According to Ohio Revised Code 1311.26, any subcontractor, material supplier, or laborer must serve the public authority with an Affidavit of Mechanic's Lien no later than 120 days after the date of last performing work or furnishing materials. According to Ohio Revised Code 1311.28:
"Upon receiving the affidavit ..., the public authority shall detain from the principal contractor or from the balance of the funds remaining in the contract with the principal contractor, an amount up to the balance remaining in the contract, that does not in the aggregate exceed the claim or claims."
Basically, once the public authority receives the affidavit, they are required to withhold payment to the principal contractor in the amount of the total claimed on the affidavit (not to exceed the unpaid balance remaining on the contract) until the situation is resolved.
Ohio Revised Code 1311.29 requires that the Affidavit of Mechanic's Lien be filed in the local county Recorder's Office no later than 30 days after the Affidavit was served on the public authority.