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High court to decide group's right to sue JobsOhio

Julie Carr Smyth, AP Statehouse Correspondent

COLUMBUS, Ohio (AP) -- Ohio's high court agreed Wednesday to determine whether opponents of the new private economic development entity created by Republican Gov. John Kasich have the standing to sue.

So far, lower courts have rejected a legal challenge to JobsOhio brought by a liberal policy group and two Democratic state lawmakers.

They've stopped short of ruling on the constitutionality of the nonprofit job-creation board, instead saying the parties can't show harm and so don't have standing. Opponents argue the law created an impossibly small window in which they had to both experience harm and file their legal challenge.

In taking the case, the Ohio Supreme Court signaled it will hear arguments and decide the question.

ProgressOhio executive director Brian Rothenberg, whose group is spearheading the legal challenge, said he hopes justices will find his group has the right to sue so legal arguments over JobsOhio's constitutionality can proceed.

"We've said all along we believe that somebody should have the right to bring this case," he said. "No court has actually ruled on the constitutionality of JobsOhio yet. The state, instead, has played legal games challenging whether any Ohioan had the right to sue."

Earning standing would allow JobsOhio opponents to get to the essence of their legal gripe with Kasich's job-creation entity: Does Ohio's Constitution allow the state to hand over taxpayer money — in the form of proceeds from Ohio's liquor business — to a private entity?

Opponents say no; the state says yes. That question would go back to the lower court if standing is granted.

Kasich spokeswoman Connie Wehrkamp said the governor's office remains confident the Supreme Court will eventually rule against the standing of ProgressOhio and Democrats Mike Skindell and Dennis Murray — as lower courts have.

"Additionally, it continues to be beyond our understanding why anyone would fight against job creation when it's so important to Ohio and our continued economic recovery," she said.

In the meantime, JobsOhio has announced it will go forward with the sale of $1.5 billion in bonds backed by future liquor profits.

Wednesday had been relayed to rating agencies as a target date for the sale. A JobsOhio spokeswoman said a firm date has not been set. The Municipal Securities Rulemaking Board indicated in an email to The Associated Press that a filing to announce the offering is expected by Friday.

In a joint statement Wednesday, plaintiffs called on the administration to hold off on the sale until the court rules.

"Proceeding with the sale before the case is resolved would be reckless," they said. "If Kasich chooses to plow ahead, bond buyers beware."

The fight over the standing issue has drawn attention across the political spectrum.

The libertarian 1851 Center for Constitutional Law backs ProgressOhio, a sometime political adversary, in its legal effort. The law center's Maurice Thompson says laws denying taxpayers the standing to sue government are dangerous and increasingly common.

The center decided to get involved for that reason in July after the 10th District Court of Appeals in Columbus upheld a judge's decision to dismiss the JobsOhio challenge citing plaintiffs' lack of standing.

The outcome of the JobsOhio case is also of interest to the Ohio Roundtable, a conservative anti-gambling group that's fighting for standing to legally challenge Kasich's decision authorizing slots-like video lottery terminals at Ohio's seven horse tracks.

The Roundtable and individual plaintiffs argue Kasich's decision to go forward with racinos is unconstitutional because expansions of the state lottery must be approved by voters.

A three-judge panel of the 10th Circuit heard arguments last week over whether the group should be granted standing in that case and is deliberating.