Ohio Gov. John Kasich has been on a mission since his election by less than half of half of registered voters two years ago to show that his idea to move the state forward, based on closely held beliefs by Republican ideologues that no new taxes on individuals or corporations and far fewer regulations on business is the best way to create jobs, is far superior to anything state government has attempted to do before.
In 2010, when the former 18-year congressman from central Ohio took on a beleaguered Democratic governor who came to power in 2006 and saw more than 430,000 jobs slip away due to the Great Recession that ravaged a nation and virtually every state, the big idea that was supposed to change how the state retained or attracted new jobs was to privatize a department that hitherto had been a public agency for going on a half century. That idea, christened JobsOhio in the run-up to the election, would have converted Ohio liquor profits, in the hundreds of millions each year, into a stream of cash that would fund business savvy employees who would “move at the speed of business.”
Among the Ohio legislature’s first initiatives, following the GOP’s retaking of the Ohio House two years ago when Republicans, including John Kasich, swept into office, was the creation of JobsOhio, John Kasich’s pet project, that would be run by a long-time buddy and campaign contributor from California, Mark Kvamme.
Kasich, at one point, was to be the chairman of the private non-profit’s board, but that self-assignment faded as critics, Democrats and progressives, raised one issue after another about an agency that would no longer have to worry about public eyes looking to see what it did or how it did it because transparency and public accountability wasn’t part of the thinking that went into creating it.
On Friday, a divided Ohio Supreme Court pitched a complaint that state officials hoped might resolve legal concerns about JobsOhio, allowing the private non-profit to run on state liquor business profits. In a 4-2 decision, justices said the high court was the wrong venue for JobsOhio’s complaint against state Commerce Director David Goodman, who has so far refused to sign an agreement between the state commerce and budget departments and JobsOhio transferring rights to the liquor business to JobsOhio for 25 years. According to the AP, the deal is worth some $1.4 billion, with the state getting the first $500 million when the transfer occurs.
Budget and JobsOhio leaders signed the agreement in August, but Goodman declined because questions of JobsOhio’s constitutionality have not been resolved.
The challenge was pitched in part because four justices realized that a lawsuit by an agency envisioned by Gov. John Kasich suing one of Kasich’s Cabinet directors had a purpose beyond securing Goodman’s signature. Goodman, a former GOP state senator before Kasich picked him, said at the time the complaint was filed that he fully supported JobsOhio but didn’t feel he could move forward while the suit was undecided.
To the chagrin of Gov. Kasich, justices wrote, “First, a review of the complaint — as well as Goodman’s motion for judgment on the pleadings — indicates that the real object sought is a declaratory judgment, which this court lacks original jurisdiction to grant.”
“Although JobsOhio’s complaint is couched in terms of compelling ODC Director Goodman to comply with his affirmative duty,” they added, “… it actually seeks an expedited ruling from this court declaring [bills creating JobsOhio] constitutional, so as to preclude any further challenges.”
Kasich’s office said that even though the decision leaves the matter in limbo, JobsOhio is doing good work. “JobsOhio has been an essential part of Ohio’s success in creating jobs and getting our state back on track,” spokeswoman Connie Wehrkamp said in a statement. “We’ve got more work to do, however, because too many Ohioans are still out of work. A strong, capable JobsOhio will continue to be instrumental to Ohio’s economic recovery.”
The AP reported that the transfer process has been delayed by a lawsuit by the liberal policy group ProgressOhio and two Democratic state lawmakers, Rep. Dennis Murray of Sandusky and Sen. Mike Skindell of Lakewood, challenging the constitutionality of turning public money over to a private entity.
The 10th District Court of Appeals in Columbus upheld a judge’s decision to dismiss the challenge on the grounds that opponents didn’t have legal standing. ProgressOhio appealed the decision to the state Supreme Court, which hasn’t yet ruled on that issue of legal standing. Not helping, the libertarian 1851 Center for Constitutional Law has sided with ProgressOhio in legal filings. ProgressOhio Executive Director Brian Rothenberg said the court’s decision leaves open the question of what legal avenue exists to challenge JobsOhio.
“Once again this court said there are legitimate constitutional issues that have to be aired,” he said, according to the Akron Beacon Journal. “So, with $550 million of state money being dangled in the hands of a private corporation like JobsOhio, when will the state allow a court to make a ruling on its constitutionality?”
JobsOhio spokeswoman Laura Jones said the action was filed in hopes the high court would resolve constitutional issues surrounding the new entity. Via email, Jones said, “We still believe that the legislation is constitutional. We obviously would have preferred the court to weigh in, but declining to hear this case isn’t a barrier to our mission to help create jobs in Ohio. We look forward to continuing to make progress in that important work.”
Rothenberg said, “The bottom line is these are self-inflicted wounds by the Kasich administration. They could have let a court decide this over a year ago and rule on the constitutionality, but they decided to play these games of challenging our legal standing and this bizarre move to having Kasich’s JobsOhio sue Kasich’s Cabinet director.”
Kasich’s critics say that had he first taken the route he seems forced to take now, he would have risked encountering a Democratic judge in the Court of Common Pleas or the Court of Appeals. Another reason to take it to the high court first is the factor of time. Appeals take a lot of time and it’s likely that Kasich wouldn’t receive a decision from the high court until after his first term ends in two years.
An unnamed legal source said Gov. Kasich does not have many good legal options. One approach could be that Gov. Kasich fire Goodman and replace him with someone who will sign the agreement without asking questions.
Friday’s decision was joined by Chief Justice Maureen O’Connor and Justices Evelyn Lundberg Stratton, Judith Ann Lanzinger and Yvette McGee Brown. Justices Paul Pfeifer and Robert Cupp entered separate dissents. Justice Terrence O’Donnell didn’t participate in the deliberations or decision.
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