Ohio Plan to Grow Jobs Using Liquor Profit Goes to Court
By Andrew Harris - Nov 6, 2013 12:00 AM ET
JobsOhio, Governor John Kasich’s initiative to spur private economic development by selling bonds backed by state liquor sales profits, has twice eluded a legal challenge by a nonprofit citizens’ group that claims the program is unconstitutional.
Today, ProgressOhio.org, which says it has 350,000 members, is set to ask the state’s highest court to revive the case. Two lower Ohio courts have ruled the group hasn’t shown it suffered any injury that would entitle it to redress under Kasich’s plan to use public money to spur private development.
“The JobsOhio arrangement violates numerous key structural limitations imposed by the Ohio Constitution on state government,” including one barring the state from making equity investments in private corporations, ProgressOhio said in an Ohio Supreme Court filing.
If the Supreme Court agrees with the lower appeals court that the group didn’t have public interest or taxpayer standing to oppose the measure, “no Ohioan has the capacity” to question the JobsOhio initiative, ProgressOhio said.
The product of legislation signed by Kasich in 2011, JobsOhio is a private entity that earlier this year sold $1.5 billion in bonds to raise money for job creation and to finance its 25-year lease of the state’s wholesale liquor distribution system. Liquor sale profits — a record $251 million last year — will be used to pay the bond debt.
In its first full year, the agency worked with 277 companies to create almost 21,000 jobs while retaining more than 54,000 more, according to its 2012 annual report. It ended fiscal 2013 with more than $181 million available for job-creation loan and grant programs, according to an audited financial statement.
Attorneys for the state maintain that the program is constitutional.
“The judiciary’s role is to resolve cases and provide remedies for persons who have suffered a wrong,” the state said in a Supreme Court filing. “The power of judicial review is not a freestanding power that allows judicial intrusion into a coordinate branch of government.”
A Kasich plan to expand Medicaid under President Barack Obama’s health care overhaul was challenged in a state Supreme Court lawsuit brought by six lawmakers and anti-abortion organizations in Cleveland and Cincinnati.
The plaintiffs claim that initiative was unlawful because Kasich obtained approval for expansion of the joint federal-state insurance program for the indigent from a state panel that considers agency spending requests after the governor was unable to persuade legislators to go along with the plan.
The JobsOhio case is ProgressOhio.org Inc. v. JobsOhio, 12-1272, Supreme Court of Ohio (Columbus).
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