State ex rel. LetOhioVote.org v. Brunner

[Cite as State ex rel. LetOhioVote.org v. Brunner, 123 Ohio St. 3d 322, 2009-Ohio-4900.]
THE STATE EX REL. LETOHIOVOTE.ORG ET AL. v.
BRUNNER, SECY. OF STATE.
[Cite as State ex rel. LetOhioVote.org v. Brunner,
123 Ohio St. 3d 322, 2009-Ohio-4900.]
The video-lottery-terminal provisions of 2009 Am.Sub.H.B. No. 1 do not fall
within any of the exceptions to the right of referendum in that they are not
laws providing for tax levies, appropriations for the current expenses of
the state government, or emergency laws necessary for the immediate
preservation of the public peace, health, or safety. Therefore, they are
subject to referendum.
(No. 2009-1310 ─ Submitted September 2, 2009 ─ Decided September 21, 2009.)
IN MANDAMUS.
__________________
SYLLABUS OF THE COURT
The video-lottery-terminal provisions of 2009 Am.Sub.H.B. No. 1 do not fall
within any of the exceptions to the right of referendum in that they are
neither laws providing for tax levies, nor appropriations for the current
expenses of the state government, nor emergency laws necessary for the
immediate preservation of the public peace, health, or safety. Therefore,
they are subject to referendum.
__________________
O’DONNELL, J.
{¶ 1} LetOhioVote.org, a ballot-issue committee, and Thomas E.
Brinkman Jr., David Hansen, and Gene Pierce, Ohio resident-electors and
members of LetOhioVote.org, filed this original action seeking a writ of
mandamus to compel the secretary of state to treat the video-lottery-terminal
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(“VLT”) provisions of 2009 Am.Sub.H.B. No. 1 (“H.B. 1”) as subject to
referendum and to discharge her duties pursuant to Article II of the Ohio
Constitution and R.C. Chapter 3519. The narrow focus of this case excludes
policy considerations, which are the province of the legislative and executive
branches, and is singularly centered on whether the citizens of Ohio have the right
of referendum on the VLT provisions of H.B. 1, which authorize the Ohio Lottery
Commission to locate as many as 2,500 VLTs at each of Ohio’s seven horse-
racing tracks for a potential of 17,500 machines in Ohio. The legal issue before
us is whether these VLT provisions of H.B. 1 are an appropriation for the current
expenses of the state government and are therefore not subject to referendum
pursuant to Section 1d, Article II of the Ohio Constitution. After careful review
of this important question, we conclude that our jurisdiction has been properly
invoked, that mandamus is an appropriate remedy, and that the VLT provisions of
H.B. 1 are subject to referendum. Because relators have established entitlement
to the requested extraordinary relief, we grant the writ and direct the secretary of
state to treat the VLT provisions of H.B. 1 as subject to referendum.
Facts and Procedural Background
{¶ 2} On July 13, 2009, Governor Strickland issued a directive to the
Ohio Lottery entitled “Implementing Video Lottery Terminals.” In particular, the
governor directed the Ohio Lottery Commission to immediately take steps to
implement the placement of as many as 2,500 VLTs at each of seven horse-racing
tracks in Ohio upon acknowledgement by the General Assembly of the
commission’s authority to do so. However, the governor expressly conditioned
the implementation of the directive upon the passage of the VLT provisions by
the General Assembly, explaining that if the provisions were not enacted “into
law as part of or prior to the FY10-11 biennial budget law and such law is not
signed into law by [the governor] within five days of the issuance of this
Directive, the Directive shall then be deemed immediately null and void.”
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H.B. 1
{¶ 3} On the same day that the governor issued his VLT directive, the
General Assembly enacted H.B. 1, which includes the 2010-2011 biennial budget.
H.B. 1 provides a line-item appropriation from the Lottery Profits Education Fund
of over $2.2 billion to the Department of Education, which increases the
appropriation to the Department of Education for Foundation Funding Fund from
this fund for the current biennium by $851.5 million to reflect the expected
revenues from the implementation of VLTs in May 2010 and the associated
license fees. H.B. 1 also includes amendments to R.C. Chapter 3770 that
authorize the State Lottery Commission to operate VLT games and promulgate
rules relating to the commission’s operation of VLT games, that specify that the
provisions of R.C. Chapter 2915 criminalizing gambling activities are
inapplicable, that bar political subdivisions from assessing new license or excise
taxes on VLT licensees, and that purport to vest this court with exclusive, original
jurisdiction over any claim that the provisions are unconstitutional.1
1. {¶ a} More specifically, the amendments to R.C. 3770.03 and the newly enacted R.C. 3770.21
in H.B. 1 are as follows, with the language enacted by H.B. 1 in italics:
{¶ b} “Sec. 3770.03. (A) The state lottery commission shall promulgate rules under which a
statewide lottery may be conducted, which includes, and since the original enactment of this
section has included, the authority for the commission to operate video lottery terminal games.
Any reference in this chapter to tickets shall not be construed to in any way limit the authority of
the commission to operate video lottery terminal games. Nothing in this chapter shall restrict the
authority of the commission to promulgate rules related to the operation of games utilizing video
lottery terminals as described in section 3770.21 of the Revised Code. * * *
{¶ c} “* * *
{¶ d} “(B) The commission shall promulgate rules, in addition to those described in division
(A) of this section, pursuant to Chapter 119. of the Revised Code under which a statewide lottery
and statewide joint lottery games may be conducted. Subjects covered in these rules shall include,
but not be limited to, the following:
{¶ e}“* * *
{¶ f}“(6) Any other subjects the commission determines are necessary for the operation of
video lottery terminal games, including the establishment of any fees, fines, or payment schedules.
{¶ g}“(C) Chapter 2915. of the Revised Code does not apply to, affect, or prohibit lotteries
conducted pursuant to this chapter.”
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{¶ 4} In enacting H.B. 1, the General Assembly declared that the
amendments relating to VLTs – R.C. 3770.03 and 3770.21 – are exempt from
referendum because “[they are] or relate[ ] to an appropriation for current
expenses within the meaning of Ohio Constitution, Article II, Section 1d and
section 1.471 of the Revised Code, * * * and therefore take[ ] effect immediately
when this act becomes law.” Section 812.20 of H.B. 1. H.B. 1 additionally
indicates that certain other amendments are subject to referendum and will not
become immediately effective. Sections 812.10, 812.30, and 812.50 of H.B. 1.
{¶ 5} The governor signed H.B. 1 into law on July 17, 2009.
Mandamus Case
{¶ 6} On July 20, 2009, relators filed this action seeking a writ of
mandamus to compel respondent, Secretary of State Jennifer Brunner, to treat the
VLT provisions of H.B. 1 as subject to referendum. We issued an accelerated
{¶ h}“Sec. 3770.21. (A) ‘Video lottery terminal’ means any electronic device approved by the
state lottery commission that provides immediate prize determinations for participants on an
electronic display.
{¶ i}“(B) The state lottery commission shall include, in any rules adopted concerning video
lottery terminals, the level of minimum investments that must be made by video lottery terminal
licensees in the buildings and grounds at the facilities, including temporary facilities, in which the
terminals will be located, along with any standards and timetables for such investments.
{¶ j}“(C) No license or excise tax or fee not in effect on the effective date of this section shall
be assessed upon or collected from a video lottery terminal licensee by any county, township,
municipal corporation, school district, or other political subdivision of the state that has authority
to assess or collect a tax or fee by reason of the video lottery terminal related conduct authorized
by section 3770.03 of the Revised Code. This division does not prohibit the imposition of taxes
under Chapter 718. or 3769. of the Revised Code.
{¶ k}“(D) The supreme court shall have exclusive, original jurisdiction over any claim
asserting that this section or section 3770.03 of the Revised Code or any portion of those sections
or any rule adopted under those sections violates any provision of the Ohio Constitution, any
claim asserting that any action taken by the governor or the lottery commission pursuant to those
sections violates any provision of the Ohio Constitution or any provision of the Revised Code, or
any claim asserting that any portion of this section violates any provision of the Ohio
Constitution. If any claim over which the supreme court is granted exclusive, original jurisdiction
by this division is filed in any lower court, the claim shall be dismissed by the court on the ground
that the court lacks jurisdiction to review it.
{¶ l}“(E) Should any portion of this section or of section 3770.03 of the Revised Code be
found to be unenforceable or invalid, it shall be severed and the remaining portions remain in full
force and effect.”
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briefing schedule and granted the motion of the directors of the Office of Budget
and Management and the Ohio Lottery Commission to intervene as additional
respondents (“intervening respondents”).
{¶ 7} On July 23, 2009, relators presented for filing with the secretary of
state a referendum-petition summary, consisting of numerous part-petitions
containing over 3,000 signatures, and a copy of one of the summary part-petitions
for filing with the office of the attorney general. The office of the secretary of
state deferred to the General Assembly’s declaration that the VLT sections of
H.B. 1 are not subject to referendum and declined to accept the filing of the
referendum petitions “[i]n the absence of a court order to the contrary.” The
office of the attorney general similarly rejected the filing presented to it, based on
the conclusion that the VLT provisions were not subject to referendum.
{¶ 8} The rejection of the proffered filings precluded relators from
circulating the referendum petition for signatures. Relators sought, and we
granted, leave to file an amended complaint that included the events that took
place after the original complaint was filed.
{¶ 9} In briefs and arguments before this court, relators contend that the
VLT provisions are subject to referendum because they are not appropriations for
current state expenses, they neither make expenditures nor incur obligations, and
they are not temporary measures necessary to effectuate an appropriation; instead,
relators argue, the VLT provisions constitute a change in the permanent law of
this state that generates, rather than spends, money, and they seek a 90-day stay of
the VLT provisions so that they may have a meaningful opportunity to circulate a
referendum petition.
{¶ 10} The secretary of state urges that she does not have a clear legal
duty to disregard the General Assembly’s declaration in the bill that the VLT
provisions are not subject to referendum or to adjudicate the question of whether
the VLT provisions constitute an appropriation for current state expenses exempt
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from referendum. Instead, she maintains that she has a duty to reject referendum
petitions that do not comply with express provisions of law and suggests that
relators have an adequate remedy at law by way of an action for a declaratory
judgment and an injunction in the common pleas court. She also contends that
relators are merely seeking a declaratory judgment and an injunction, which this
court lacks jurisdiction to issue.
{¶ 11} Intervening respondents contend that the VLT provisions are not
subject to referendum, because they appropriate money for education. However,
to the extent that the VLT provisions themselves are not direct appropriations, the
intervening respondents argue that the referendum process does not apply to laws
providing for appropriations for current state expenses or to laws that are
“inextricably tied” to a line-item appropriation for the current expenses of the
state government or state institutions. Thus, intervening respondents claim that
the VLT provisions provide for, or are inextricably tied to, the line-item
appropriation for education in H.B. 1 because the VLT provisions generate the
revenue that funds the appropriation. Further, without the VLT provisions, the
appropriation cannot become immediately effective as required by Section 1d,
Article II, of the Ohio Constitution. Lastly, the intervening respondents contend
that granting a writ of mandamus would be a vain act because the Lottery
Commission already possesses the authority to implement VLT gaming without
the amendments enacted by H.B. 1.
{¶ 12} Accordingly, we are called on to address whether relators are
entitled to a writ of mandamus to compel the secretary of state to treat the VLT
provisions of H.B. 1 as subject to referendum.
Mandamus
{¶ 13} To be entitled to a writ of mandamus, “relators must establish a
clear legal right to the requested relief, a corresponding clear legal duty on the
part of the secretary of state to provide it, and the lack of an adequate remedy in
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the ordinary course of the law.” State ex rel. Heffelfinger v. Brunner, 116 Ohio
St.3d 172, 2007-Ohio-5838, 876 N.E.2d 1231, ¶ 13. Mandamus is available to
challenge the failure to certify a referendum-petition summary. Cf. State ex rel.
Barren v. Brown (1977), 51 Ohio St. 2d 169, 171, 5 O.O.3d 136, 365 N.E.2d 887
(writ of mandamus granted to compel attorney general to certify that the
referendum-petition summary is a fair and truthful statement of the measure to be
referred).
{¶ 14} Relators seek a writ of mandamus to compel the secretary of state
to treat the VLT sections of H.B. 1 – R.C. 3770.03 and 3770.21 – as subject to the
constitutional right of referendum and to fulfill each of her duties and obligations
relating to the referendum under Article II of the Ohio Constitution and R.C.
Chapter 3519. We conclude that relators’ complaint for a writ of mandamus
properly invokes our original jurisdiction and that an action in the court of
common pleas for a declaratory judgment or a prohibitory injunction would not
provide an adequate remedy in the ordinary course of law.
{¶ 15} “In general, if declaratory judgment would not be a complete
remedy unless coupled with extraordinary ancillary relief in the nature of a
mandatory injunction, the availability of declaratory judgment does not preclude a
writ of mandamus.” State ex rel. Mill Creek Metro. Park Dist. Bd. of Commrs. v.
Tablack (1999), 86 Ohio St. 3d 293, 297, 714 N.E.2d 917. In this case, a
declaratory judgment would not be an adequate remedy without a mandatory
injunction ordering the secretary of state to treat the VLT sections of H.B. 1 as
subject to referendum. See State ex rel. Ohio Gen. Assembly v. Brunner, 114
Ohio St. 3d 386, 2007-Ohio-3780, 872 N.E.2d 912, ¶ 25.
{¶ 16} Nor would a prohibitory injunction provide relators with the relief
they request here: an order to compel the secretary of state to comply with her
duties under Section 1c, Article II of the Ohio Constitution and R.C. 3519.01 to
treat the VLT provisions as being subject to referendum. Moreover, given the
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state’s desire to immediately implement these provisions and relators’ wish to
immediately begin the referendum process, a common pleas court action would
not be sufficiently speedy to determine whether the VLT provisions of H.B. 1 are
subject to referendum. See State ex rel. Beane v. Dayton, 112 Ohio St. 3d 553,
2007-Ohio-811, 862 N.E.2d 97, ¶ 31 (“The alternate remedy must be complete,
beneficial, and speedy in order to be an adequate remedy at law”).
{¶ 17} Therefore, relators lack an adequate remedy in the ordinary course
of law to raise their claim, and mandamus is an appropriate remedy to resolve it.
The Right of Referendum
{¶ 18} “The constitutional right of citizens to referendum is of paramount
importance.” State ex rel. Ohio Gen. Assembly v. Brunner, 115 Ohio St. 3d 103,
2007-Ohio-4460, 873 N.E.2d 1232, ¶ 8. “The referendum * * * is a means for
direct political participation, allowing the people the final decision, amounting to
a veto power, over enactments of representative bodies. The practice is designed
to ‘give citizens a voice on questions of public policy.’ ” Eastlake v. Forest City
Ents., Inc. (1976), 426 U.S. 668, 673, 96 S. Ct. 2358, 49 L. Ed. 2d 132, quoting
James v. Valtierra (1971), 402 U.S. 137, 141, 91 S. Ct. 1331, 28 L. Ed. 2d 678.
{¶ 19} In 1912, the electors of Ohio adopted the initiative and referendum
amendment to the constitution. Shortly thereafter, we explained the significance
of the amendment:
{¶ 20} “Now, the people’s right to the use of the initiative and referendum
is one of the most essential safeguards to representative government. * * * The
potential virtue of the ‘I. & R.’ does not reside in the good statutes and good
constitutional amendments initiated, nor in the bad statutes and bad proposed
constitutional amendments that are killed. Rather, the greatest efficiency of the ‘I.
and R.’ rests in the wholesome restraint imposed automatically upon the general
assembly and the governor and the possibilities of that latent power when called
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into action by the voters.” State ex rel. Nolan v. ClenDening (1915), 93 Ohio St.
264, 277-278, 112 N.E. 1029.
{¶ 21} “This reserved power of referendum applies to every law passed in
this state and provides an important check on actions taken by the government.”
Ohio Gen. Assembly, 115 Ohio St. 3d 103, 2007-Ohio-4460, 873 N.E.2d 1232, ¶ 9.
Thus, “[l]aws generally do not take effect until 90 days have passed from the date
they are filed by the governor with the secretary of state, to allow for a possible
referendum. Section 1c, Article II, Ohio Constitution.” Id.
Exceptions to the Right of Referendum
{¶ 22} Section 1d, Article II of the Ohio Constitution sets forth exceptions
to the general rule that all laws and sections of laws are subject to referendum and
thus do not become immediately effective:
{¶ 23} “Laws providing for tax levies, appropriations for the current
expenses of the state government and state institutions, and emergency laws
necessary for the immediate preservation of the public peace, health or safety,
shall go into immediate effect. * * * The laws mentioned in this section shall not
be subject to referendum.”
{¶ 24} In construing these exceptions, “we must ‘read words and phrases
in context according to the rules of grammar and common usage.’ ” State ex rel.
Colvin v. Brunner, 120 Ohio St. 3d 110, 2008-Ohio-5041, 896 N.E.2d 979, ¶ 43,
quoting State ex rel. Lee v. Karnes, 103 Ohio St. 3d 559, 2004-Ohio-5718, 817
N.E.2d 76, ¶ 23. We liberally construe the powers of initiative and referendum to
effectuate the rights reserved. State ex rel. Evans v. Blackwell, 111 Ohio St. 3d 1,
2006-Ohio-4334, 854 N.E.2d 1025, ¶ 32. Further, “[i]n view of the great
precaution taken by the constitutional convention of 1912 to set forth and
safeguard, with the particularity of detail usually found only in legislative acts, the
right of referendum, and the three exceptions thereto, our court should not deny
the people that right, unless the act in question is plainly and persuasively
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included within one of the three classes excepted from the operation of the
referendum.” (Emphasis added.) State ex rel. Keller v. Forney (1923), 108 Ohio
St. 463, 467-468, 141 N.E. 16. These exceptions to the general rule of referendum
must be strictly, but reasonably, construed. Id. at paragraphs one and two of the
syllabus.
The Language of the Exceptions
{¶ 25} The intervening respondents contend that the court should read the
exception for appropriations to include “laws providing for” appropriations. We
reject this contention. The language used in Section 1d, Article II of the Ohio
Constitution demonstrates that the phrase “Laws providing for” modifies only
“tax levies.” Otherwise, Section 1d would also provide an exception for “Laws
providing for * * * emergency laws.” Further, to the extent that there are two
reasonable interpretations of Section 1d, our caselaw requires that we narrowly
construe the exceptions to the right of referendum.
{¶ 26} The plain language of Section 1d, Article II of the Ohio
Constitution creates three categories of exceptions from referendum: (1) laws
providing for tax levies, (2) appropriations for current expenses of the state
government and state institutions, and (3) emergency laws necessary for the
immediate preservation of the public peace, health, or safety.
{¶ 27} Intervening respondents also contend either that the VLT
provisions themselves are an appropriation or that when read in pari materia with
the constitutional requirement that any funds raised by the state lottery can be
used only to support education, this legislation is an appropriation. We do not
agree.
{¶ 28} An appropriation is “an authorization granted by the general
assembly to make expenditures and to incur obligations for specific purposes.”
R.C. 131.01(F). Similarly, in State ex rel. Akron Edn. Assn. v. Essex (1976), 47
Ohio St. 2d 47, 49, 1 O.O.3d 28, 351 N.E.2d 118, we explained that the ordinary
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and common meaning of the phrase “appropriation bill” is a “measure before a
legislative body which authorizes ‘the expenditure of public moneys and
stipulating the amount, manner, and purpose of the various items of expenditure.’
” Id. at 49, quoting Webster’s New International Dictionary (2d Ed.). See also
Black’s Law Dictionary (9th Ed.2009) 117-118 (defining “appropriation” to mean
“[a] legislative body’s act of setting aside a sum of money for a public purpose”).
{¶ 29} The VLT provisions of H.B. 1 are not themselves appropriations
for state expenses because they do not set aside a sum of money for a public
purpose; neither R.C. 3770.03 nor 3770.21 as amended by H.B. 1 makes
expenditures or incurs obligations. Rather, they authorize the State Lottery
Commission to operate VLT games and to promulgate rules relating to the
commission’s operation of VLT games, specify that the provisions of R.C.
Chapter 2915 criminalizing gambling activities are inapplicable, bar political
subdivisions from assessing new license or excise taxes on VLT licensees, and
purport to vest this court with exclusive, original jurisdiction over any claim that
the provisions are unconstitutional.
{¶ 30} We reject intervening respondent’s position that because the funds
generated by the VLTs must be used for education, the VLT provisions of H.B. 1
constitute an appropriation. Section 6, Article XV mandates that any funds raised
by the state lottery be used to support education “as determined in appropriations
made by the General Assembly.” The VLT provisions of H.B. 1 do not
appropriate anything. A separate provision of H.B. 1 – line-item 200612 –
appropriates these funds to education. Thus, notwithstanding the constitutional
mandate that all lottery funds be spent on education, the existence of a separate
line item for appropriation of the revenues generated by VLTs demonstrates that
the VLT provisions themselves are not appropriations.
Inextricably Tied or Related to Appropriations
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{¶ 31} The intervening respondents next claim that even if the challenged
VLT provisions do not specifically set aside a sum of money for a specific public
purpose, they are within the appropriations exception because they are
“inextricably tied” to the $2.3 billion in appropriations from the Lottery Profits
Education Fund for education provided by H.B. 1. Relators counter that the VLT
sections are not within the Section 1d, Article II exception, because they raise
revenue rather than spend it.
Section 812.20
{¶ 32} The General Assembly specified in Section 812.20 of H.B. 1 that
the amendment concerning VLTs in R.C. 3770.03 and 3770.21 is excluded from
referendum because “it is or relates to an appropriation for current expenses
within the meaning of Ohio Constitution, Article II, Section 1d and section 1.471
of the Revised Code.” (Emphasis added.) This language, like the intervening
respondents’ advocated construction of the exception, is broader than the
applicable constitutional language, which states that “appropriations for the
current expenses of the state government and state institutions * * * shall go into
immediate effect * * * [and] shall not be subject to referendum.” Section 1d,
Article II. The constitutional language does not expressly include an exception
for laws that relate to appropriations for the current expenses of the state
government.
{¶ 33} Moreover, this court has previously held that the analogous
exception of Section 1d, Article II for “laws providing for tax levies” is “limited
to an actual self-executing levy of taxes, and is not synonymous with laws
‘relating’ to tax levies, or ‘pertaining’ to tax levies, or ‘concerning’ tax levies.”
Keller, 108 Ohio St. 463, 141 N.E. 16, at paragraph three of the syllabus; see also
State ex rel. Taft v. Franklin Cty. Court of Common Pleas (1998), 81 Ohio St. 3d
480, 483, 692 N.E.2d 560 (holding that an act that authorizes the electorate to
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determine whether taxes should be levied does not levy taxes and consequently
that Section 1d, Article II does not apply).
{¶ 34} Therefore, notwithstanding the General Assembly’s language in
Section 812.20 of the act, the VLT sections of H.B. 1 are not excepted from
referendum if they merely relate to an appropriation for current state-government
expenses; the exception is for appropriations for the current expenses of the state
government – not for enactment of laws (other than tax levies) designed to
generate revenue that can be appropriated.
{¶ 35} There is no authority in our precedent that would permit the
referendum exception to apply to provisions that, once implemented, raise
revenue to provide funds for an appropriation in another part of the act, even if –
as the intervening respondents claim – they are “inextricably tied” or related to
each other.
Kelly and Cty. Rd. Assn.
{¶ 36} Intervening respondents’ reliance on Kelly v. Marylanders for
Sports Sanity, Inc. (1987), 310 Md. 437, 530 A.2d 245, and Cty. Rd. Assn. of
Michigan v. Bd. of State Canvassers (1979), 407 Mich. 101, 282 N.W.2d 774, is
unpersuasive and misplaced. Both cases involved legislation linked to an
appropriation that the courts determined was not subject to referendum.
{¶ 37} In Kelly, the Court of Appeals of Maryland held that statutes
authorizing the state stadium authority to borrow funds through the issuance of
bonds and designating a site for the construction of professional baseball and
football stadiums constituted appropriations that were not subject to referendum
because those statutes were part of an interdependent and legally inseparable
package of legislation that appropriated funds. 310 Md. at 474, 530 A.2d 245.
Similarly, in Cty. Rd. Assn., the Supreme Court of Michigan concluded that
statutes increasing various taxes on fuel and vehicle registrations constituted part
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of the appropriation to the highway department and were not subject to
referendum.
{¶ 38} Kelly and Cty. Rd. Assn. are distinguishable from the case before
us because the state constitutions in those jurisdictions do not contain an
exception from referendum for legislation that raises revenue by imposing a tax
levy. See Section 2, Article 16, Maryland Constitution; Section 9, Article 2,
Michigan Constitution.
{¶ 39} In contrast, the Ohio Constitution specifically exempts laws
providing for tax levies from referendum. Section 1d, Article II, Ohio
Constitution. The electorate could have expressly excepted other means of raising
revenue from referendum, but it did not. As we have consistently held, “ ‘[t]he
canon expressio unius est exclusio alterius tells us that the express inclusion of
one thing implies the exclusion of the other.’ ” Crawford-Cole v. Lucas Cty.
Dept. of Job & Family Servs., 121 Ohio St. 3d 560, 2009-Ohio-1355, 906 N.E.2d
409, ¶ 42, quoting Myers v. Toledo, 110 Ohio St. 3d 218, 2006-Ohio-4353, 852
N.E.2d 1176, ¶ 24. In fact, if we were to read the appropriations exception to
referendum as broadly as the intervening respondents advocate, the exception for
tax levies would be meaningless because all means of raising revenue for
government appropriations could be considered inextricably tied to
appropriations.
{¶ 40} Our view is supported by the caselaw of other jurisdictions
concluding that measures raising the revenue to be appropriated are not
appropriations. See Nicholson v. Cooney (1994), 265 Mont. 406, 415-416, 877
P.2d 486 (rejecting the argument that a revenue-raising measure that was
“inextricably tied” to appropriations legislation and that was used to balance the
state budget fell within the appropriations exception to referendum); Lawrence v.
Beermann (1974), 192 Neb. 507, 508-509, 222 N.W.2d 809 (explaining that the
appropriations exception to referendum “should be and must be construed to
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mean the ordinary running expenses of the state government and existing state
institutions, and not to include money or appropriations or funds created or acts
which have as their design a new or different scheme for * * * revenue raising and
financing”); Brooks v. Zabka (1969), 168 Colo. 265, 270-271, 450 P.2d 653
(“The sales tax ordinance involved here is designed to raise revenue, not to
provide for expenditures from public funds. * * * A sales tax ordinance is the
exact antithesis of an appropriation” excepted from referendum); Heinkel v.
Toberman (1950), 360 Mo. 58, 69, 226 S.W.2d 1012 (declining to construe a fuel
tax as an appropriation, notwithstanding a separate constitutional provision
requiring the funds generated by such taxes to be appropriated by the legislature
for certain projects related to the state highway system).
Taft and Davies Mfg.
{¶ 41} The intervening respondents rely on State ex rel. Taft v. Franklin
Cty. Court of Common Pleas (1998), 81 Ohio St. 3d 480, 692 N.E.2d 560, and
State ex rel. Davies Mfg. Co. v. Donahey (1916), 94 Ohio St. 382, 114 N.E. 1037,
in support of their argument that provisions of law that are inextricably tied to
appropriations are exempt from referendum. This reliance, however, is
misplaced.
{¶ 42} In Taft, we held that certain provisions of legislation imposing
taxes to fund public schools were not subject to referendum although they did not
appropriate money because implementation of those sections – calling for a
statewide election on a proposed increase in the state sales and use tax – depended
upon the appropriation of money for the election in a separate section of the same
act. 81 Ohio St. 3d at 484, 692 N.E.2d 560.
{¶ 43} Unlike the provisions at issue in Taft, the VLT provisions are not
dependent upon any appropriation in H.B. 1. If anything, as the intervening
respondents concede, the dependency is reversed: the appropriation of over $2.2
billion to the Department of Education from the Lottery Profits Education Fund is
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dependent, in part, upon the projected revenues from the enactment of the VLT
provisions. The VLT provisions are also not dependent upon the provision in
Section 305.10 of H.B. 1 authorizing the office of the inspector general to use
$50,000 of its operating expenses in each fiscal year to defray any expenses
associated with reviewing the VLT operations. Section 305.10 does not
implement the VLT sections, and the inspector general need not use any money to
review VLT operations.
{¶ 44} Intervening respondents’ reliance on Davies Mfg., 94 Ohio St. 382,
114 N.E. 1037, is also misplaced. There, we held that a competitive-bidding
requirement was not subject to referendum, because it was only a condition for an
appropriation for the current expenses of the state government; it never became
part of the permanent law.
{¶ 45} In State ex rel. Ohio AFL-CIO v. Voinovich (1994), 69 Ohio St. 3d
225, 631 N.E.2d 582, we explained that “ ‘[a]ny section of a law which changes
the permanent law of the state is subject to referendum under the powers reserved
to the people by Section 1 of Article II [of the Ohio Constitution], even though the
law also contains a section providing for an appropriation for the current expenses
of the state government and state institutions which under Section 1d, Article II,
becomes immediately effective.’ ” Id. at 236, quoting State ex rel. Riffe v. Brown
(1977), 51 Ohio St. 2d 149, 167, 5 O.O.3d 125, 365 N.E.2d 876 (O’Neill, C.J.,
dissenting). As Chief Justice O’Neill observed in distinguishing Davies Mfg. in
Riffe, which was overruled in Ohio AFL-CIO, 69 Ohio St. 3d at 236, “[t]o give
practical effect to the constitutional exception for appropriations, temporary
provisions needed to implement the appropriation must also be effective
immediately. But a change in the permanent law governing the people of Ohio,
which incidentally may require an appropriation, is a wholly different matter.”
Riffe, 51 Ohio St. 2d at 165.
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January Term, 2009
{¶ 46} The challenged VLT provisions are not temporary measures that
are conditions upon the appropriations made from the lottery profits education
fund. The VLT sections of H.B. 1 change the permanent law of this state by, inter
alia, defining VLTs, requiring the State Lottery Commission to promulgate rules
establishing the licensees’ minimum investments in buildings and grounds at the
facilities where the VLTs will be located, barring new license or excise taxes on
licensees after the effective date of the provisions, and purporting to vest
exclusive, original jurisdiction in this court over any claims asserting that the
VLT sections or any actions taken by the governor or State Lottery Commission
pursuant to these sections are unconstitutional. Further, the amendment to R.C.
3770.03 permanently changes the law of Ohio by authorizing the Ohio Lottery
Commission to operate VLT games, defined in proposed R.C. 3770.21(A) to
mean “any electronic device approved by the state lottery commission that
provides immediate prize determinations for participants on an electronic
display.”
{¶ 47} The changes to the permanent law of the state distinguish the
instant case from Taft and Davies Mfg., in which temporary measures were
enacted to effectuate an appropriation. The VLT provisions at issue here
constitute permanent changes that will be effective well after the biennium ends
and are thus subject to referendum.
{¶ 48} A different section of the Ohio Constitution also supports our
conclusion that the VLT provisions of H.B. 1 are not an appropriation. Section
22, Article II of the Ohio Constitution provides that “no appropriation shall be
made for a longer period than two years.” In contrast to this temporal limitation,
the VLT provisions of H.B. 1 – R.C. 3770.03 and 3770.21 – do not expire in two
years and are designed to become a permanent part of state law for purposes of
generating state income. As such, these provisions are not appropriations.
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SUPREME COURT OF OHIO
{¶ 49} The plain language of Section 1d, Article II of the Ohio
Constitution provides three limited exceptions to referendum: laws providing for
tax levies, appropriations for the current expenses of the state government, and
emergency laws necessary for the immediate preservation of the public peace,
health, or safety, none of which expressly excepts changes to the permanent law
of this state that provide a mechanism to raise revenue to provide funds for an
appropriation. Courts are not authorized to add exceptions that are not contained
in the express language of these constitutional provisions. Cf., e.g., State ex rel.
Stoll v. Logan Cty. Bd. of Elections, 117 Ohio St. 3d 76, 2008-Ohio-333, 881
N.E.2d 1214, ¶ 39 (“the statute contains no exception, and we cannot add one to
its express language”).
{¶ 50} The intervening respondents’ interpretation of the appropriations
exception would mean that even if the electorate repealed the tax-levy exception,
laws providing for tax levies would remain excluded from referendum because
they are “inextricably tied” or “related” to appropriations. In addition, under this
interpretation of Section 1d, Article II of the Ohio Constitution, the General
Assembly could presumably enact laws to raise revenue for appropriations by
legalizing drugs or prostitution and thereby prevent the electorate from seeking
referendum on the manner it chose to generate revenue to be used for an
appropriation. This is not the meaning of Section 1d, Article II of the Ohio
Constitution. See State ex rel. Colvin v. Brunner, 120 Ohio St. 3d 110, 2008-
Ohio-5041, 896 N.E.2d 979, ¶ 58 (courts have duty to construe constitutional
provisions to avoid unreasonable or absurd results). Our duty is to construe the
meaning of the plain language of the Constitution.
{¶ 51} Finally, we decline the invitation of the intervening respondents to
address whether the State Lottery Commission is authorized to implement VLTs
regardless of whether the challenged provisions of H.B. 1 are effective, because
the parties have not submitted complete evidence and argument on this issue. We
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January Term, 2009
confine our opinion here to only the narrower issue raised in this case regarding
the rights of citizens to a referendum on the VLT provisions of H.B. 1.
Furthermore, declining to address a legal issue not squarely before us is consistent
with our reluctance to issue advisory opinions, the principle of judicial restraint,
and our duty to liberally construe election laws in favor of the right to vote. State
ex rel. Myles v. Brunner, 120 Ohio St. 3d 328, 2008-Ohio-5097, 899 N.E.2d 120, ¶
26, fn. 2, quoting State ex rel. Barletta v. Fersch, 99 Ohio St. 3d 295, 2003-Ohio-
3629, 791 N.E.2d 452, ¶ 22 (“ ‘we will not issue advisory opinions, and this rule
applies equally to election cases’ ”); PDK Laboratories, Inc. v. United States
Drug Enforcement Admin. (C.A.D.C.2004), 362 F.3d 786, 799 (Roberts, J.,
concurring in part and in judgment) (recognizing the “cardinal principle of
judicial restraint – if it is not necessary to decide more, it is necessary not to
decide more”); Colvin, 120 Ohio St. 3d 110, 2008-Ohio-5041, 896 N.E.2d 979, ¶
62 (noting the court’s “duty to liberally construe election laws in favor of the right
to vote”).
Conclusion
{¶ 52} Accordingly, relators, LetOhioVote.org, Brinkman, Hansen, and
Pierce, have established entitlement to the requested extraordinary relief in
mandamus, and the secretary of state is directed to accept the submission of
relators’ referendum-petition summary and to discharge the duties of her office as
provided by Article II of the Ohio Constitution and R.C. 3519.01.
{¶ 53} The video-lottery-terminal provisions of 2009 Am.Sub.H.B. No. 1
do not fall within any of the exceptions to the right of referendum in that they are
neither laws providing for tax levies, nor appropriations for the current expenses
of the state government, nor emergency laws necessary for the immediate
preservation of the public peace, health, or safety. Therefore, they are subject to
referendum.
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SUPREME COURT OF OHIO
{¶ 54} In conformity with our decision in Ohio AFL-CIO, 69 Ohio St. 3d
at 236-237, 631 N.E.2d 582, and as acknowledged by the respondents at oral
argument, relators are entitled to an extension of the 90-day period in which to
submit a referendum petition on the VLT provisions to the secretary of state. We
therefore stay the amendments to R.C. 3770.03 and the enactment of R.C.
3770.21, which are the VLT provisions of H.B. 1, for 90 days from the date of
this decision in order to allow relators a meaningful opportunity to circulate a
referendum petition.
{¶ 55} Ours is still a representative democracy in which legislators derive
their authority from the citizens of our state, who enjoy a constitutional right of
referendum. While the Ohio Constitution expressly provides that appropriations
for the current expenses of the state government are not subject to referendum,
permanent changes to state law relating to such appropriations are subject to
referendum. We are not unmindful of the effect our decision may have on the
state budget, nor of the commendable efforts of the members of the executive and
legislative branches of state government to fulfill their constitutional duties to
balance the budget in Ohio; however, our own constitutional duty is to ensure
compliance with the requirements of the Ohio Constitution irrespective of their
effect on the state’s current financial conditions.
Writ granted.
MOYER, C.J., and LUNDBERG STRATTON, O’CONNOR, LANZINGER, and
CUPP, JJ., concur.
PFEIFER, J., dissents.
__________________
PFEIFER, J., dissenting.
{¶ 56} I would deny the writ.
{¶ 57} This case is truly one of first impression. Here, for the first time,
this court is analyzing the state’s biennial budget bill for the purpose of
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January Term, 2009
determining citizens’ right to seek referendum. Although this court has
previously interpreted Sections 1c and 1d, Article II of the Ohio Constitution in
State ex rel. Riffe v. Brown (1977), 51 Ohio St. 2d 149, 5 O.O.3d 125, 365 N.E.2d
876; State ex rel. Ohio AFL-CIO v. Voinovich (1994), 69 Ohio St. 3d 225, 631
N.E.2d 582; and State ex rel. Taft v. Franklin Cty. Court of Common Pleas
(1998), 81 Ohio St. 3d 480, 692 N.E.2d 560, this case is different in that we are
asked to interpret those sections in the context of the 2010-2011 budget bill. This
difference alters the prism through which we must view the legislation in relation
to referendum.
{¶ 58} The people’s power of referendum set forth in Section 1c, Article
II of the Ohio Constitution is limited by the General Assembly’s power to raise
and disburse funds pursuant to Section 1d, Article II. Section 1c, Article II of the
Ohio Constitution provides:
{¶ 59} “The second aforestated power reserved by the people is
designated the referendum, and the signatures of six per centum of the electors
shall be required upon a petition to order the submission to the electors of the
state for their approval or rejection, of any law, section of any law or any item in
any law appropriating money passed by the general assembly.”
{¶ 60} Section 1c, Article II does indeed allow referendum on
appropriations, namely, “any item in any law appropriating money passed by the
general assembly.” But Section 1d, Article II limits referendum’s reach:
{¶ 61} “Laws providing for tax levies, appropriations for the current
expenses of the state government and state institutions, and emergency laws
necessary for the immediate preservation of the public peace, health or safety,
shall go into immediate effect. * * * The laws mentioned in this section shall not
be subject to the referendum.”
{¶ 62} Appropriations for “the current expenses of the state government
and state institutions” are the type of appropriations shielded from referendum.
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SUPREME COURT OF OHIO
The exceptions in Section 1d, Article II allow the legislature to budget without the
uncertainty that referendum brings to the legislative process. Free from the threat
of referendum, obligations and the means to fulfill those obligations are preserved
with predictability. The exemption from referendum allows the state to make
good on its liabilities; without it, the budget could remain in limbo for over a year,
leaving the state unable to pay its “current expenses.” With the shield from
referendum, the business of the state moves forward, leaving budget-related
legislation in place.
{¶ 63} The legislation contained in Am.Sub.H.B. No. 1 (“H.B. 1”) related
to video lottery terminals (“VLTs”) is no mere legislative add-on, snuck into a
mammoth bill. Instead, the VLT legislation is at the very heart of the budget bill,
at the very heart of how Ohio is going to pay for its spending over the next two
years. Without VLT-enabling legislation, the budget crumbles. Pursuant to H.B.
1, a $2.267 billion appropriation for schools is dependent upon the
implementation of VLTs in Ohio. Without the income expected from VLTs, a
large part of the funding for that appropriation vanishes, leaving an $851.5 million
hole in the budget.
{¶ 64} The money to be raised by VLTs is directly and inextricably linked
to a specific appropriation. R.C. 3770.06(B) requires net profits from all lottery
functions—including proceeds from VLTs—to be deposited into the Lottery
Profits Education Fund. For fiscal years 2010 and 2011, the budget bill requires
that approximately $2.267 billion flow directly from the Lottery Profits Education
Fund to local school districts according to the Foundation Funding formula. Line
200612 of the budget bill instructs that some $2.267 billion from the Lottery
Profits Education Fund—more than $990 million in fiscal year 2010, and nearly
$1.3 billion in fiscal year 2011—will go to local schools in the biennium. See
H.B. 1 at 2797. At regular intervals throughout the budget period, monies are
issued from the Lottery Profits Education Fund to the treasurer for disbursement
22
January Term, 2009
to school districts throughout the state. There is no commingling of funds—every
cent of the estimated $851.5 million VLT revenue will go into the Lottery Profits
Education Fund, and every cent of that fund will go to Ohio schools.
{¶ 65} With VLT-enabling legislation at risk of referendum, the General
Assembly cannot make the appropriation from the Lottery Profits Education Fund
that it had budgeted. To decimate the fund is to kill the appropriation that comes
from that fund. There is no spending without a source of funds.
{¶ 66} The highest courts of Michigan and Maryland have held that a law
that raises revenue and then appropriates it for a specific purpose is sheltered from
the referendum power. Cty. Rd. Assn. of Michigan v. Bd. of State Canvassers
(1979), 407 Mich. 101, 282 N.W.2d 774; Kelly v. Marylanders for Sports Sanity,
Inc. (1987), 310 Md. 437, 530 A.2d 245. The Michigan Constitution exempts
“acts making appropriations for state institutions” from the right of referendum.
Section 9, Article 2. In Cty. Rd. Assn., citizens sought referendum on legislation
that increased taxes on motor vehicle fuel and vehicle weight. A separate bill
established allocations for transportation projects. The Michigan Supreme Court
held that the statutes establishing the taxes should be read in pari materia with
appropriation statutes:
{¶ 67} “ ‘Statutes In pari materia are those which relate to the same
person or thing, or the same class of persons or things, or which have a common
purpose. It is the rule that in construction of a particular statute, or in the
interpretation of its provisions, all statutes relating to the same subject, or having
the same general purpose, should be read in connection with it, as together
constituting one law, although enacted at different times, and containing no
reference one to the other.’ ” Cty. Rd. Assn., 407 Mich. at 119, 282 N.W.2d 774,
quoting Detroit v. Michigan Bell Telephone Co. (1965), 374 Mich. 543, 558, 132
N.W.2d 660.
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SUPREME COURT OF OHIO
{¶ 68} The court held that the taxes and the expenditures for roadways
“must be viewed as a comprehensive, single legislative program.” Cty. Rd. Assn.,
407 Mich. at 118, 282 N.W.2d 774. The court pointed to the statements of the
governor and to legislative history to establish the inextricable linkage between
the taxing and appropriations statutes: “Both the Governor's stated approach and
what legislative history is available suggest * * * ‘a comprehensive system for the
collecting of specific taxes on motor vehicles and motor vehicle fuels, the
allocation of funds therefrom and the use thereof for (transportation) purposes.’ ”
(Footnote deleted.) Id., quoting Michigan Good Rds. Fedn. v. Alger (1952), 333
Mich. 352, 360-361, 53 N.W.2d 481.
{¶ 69} Likewise, the highest court in Maryland has held that a “revenue
raising and spending measure” is “embraced within the exclusionary provisions
contained in the Referendum Amendment.” Kelly v. Marylanders for Sports
Sanity, Inc., 310 Md. at 461, 530 A.2d 245. The Maryland Constitution exempts
from the referendum power “appropriation[s] for maintaining the State
Government.” Section 2, Article XVI. The legislation involved in Kelly was a
comprehensive scheme to raise funds to acquire land and construct sports
facilities at Camden Yards for the Baltimore Orioles and a possible NFL team,
including provisions authorizing the Stadium Authority to issue bonds to raise
revenue for the project and a requirement that the State Lottery Agency conduct
each year between two and four sports lotteries for the benefit of the Stadium
Authority. Kelly, 310 Md. at 439-444, 530 A.2d 245. The court held that an
untenable result would follow if the court attempted to detach the various
provisions from one another. “Considered apart, the stadium bills would not be
workable to achieve the objective of the appropriation,” and to sever the
provisions “would scuttle the entire project by fatally undermining its dominant
purpose—to finance the acquisition of a site upon which to construct sports
stadiums.” Kelly, 310 Md. at 474, 530 A.2d 245. Accordingly, the court
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January Term, 2009
concluded, the legislature intended for the provisions to “function in tandem as a
unitary solution to its singular objective—an objective which it timed for
immediate implementation.” Kelly, 310 Md. at 473, 530 A.2d 245.
{¶ 70} These state supreme courts have correctly understood that the
appropriations exception to the referendum power “has as its constitutional
purpose protecting from referendum the purpose or object of the legislative
appropriation.” (Emphasis sic.) Kelly, 310 Md. at 472, 530 A.2d 245. It is the job
of courts to determine whether the “dominant statutory objective” of the
appropriation can be implemented without the supporting legislation. Id. The
dominant statutory objective of the appropriation at issue in this case is the
funding of the Lottery Education Fund and the concomitant funding of Ohio
schools. Without the supporting VLT-enabling legislation, the objective of the
appropriation cannot be implemented.
{¶ 71} The shield for appropriations from referendum is useless if the
funding source of the appropriation is not also shielded from referendum.
Otherwise, a tiny minority (in Ohio, six percent of the voting electorate, Section
1c) can suspend the operation of an otherwise valid appropriation by targeting its
funding source for a referendum challenge. The resulting hole in the budget
throws the entire finances of the state into disarray, affecting other appropriations.
{¶ 72} This case is about certainty in Ohio’s budget. It is not about
whether the governor and the General Assembly acted prudently in dismissing the
people’s will – demonstrated time and again at the ballot box – to keep slot
machines out of Ohio. The budget crafted by the governor and enacted by the
General Assembly cannot be overturned by referendum. However, the people
retain the right to prohibit by constitutional initiative slot machines of any type or
by any name. The governor and the individual members of the General Assembly
remain answerable to the people through election.
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SUPREME COURT OF OHIO
{¶ 73} The chaos that may follow this court’s decision today cannot be
blamed entirely on the majority opinion, which applies a narrow but plausible
interpretation of our constitution’s limits on referendum. The governor and the
General Assembly have sown the wind, and now with a budget thrown into
complete disarray, we shall all reap the whirlwind.
__________________
Langdon Law, L.L.C., David R. Langdon, Thomas W. Kidd Jr., and
Bradley M. Peppo; Jones Day, Michael A. Carvin, Douglas R. Cole, and Chad A.
Readler, for relators.
Richard Cordray, Attorney General, and Richard N. Coglianese, Erick D.
Gale, and Pearl M. Chin, Assistant Attorneys General, for respondent.
Richard Cordray, Attorney General, Benjamin C. Mizer, Solicitor General,
Alexandra T. Schimmer, Chief Deputy Solicitor General, David M. Lieberman,
Deputy Solicitor, and William C. Becker, Assistant Attorney General, for
intervening respondents.
Maurice A. Thompson, urging granting of the writ for amici curiae the
Buckeye Institute for Public Policy Solutions, Citizens in Charge, Coalition
Opposed to Additional Spending & Taxes, Ohio Citizen Action, and the Ohio
Freedom Alliance.
Matthew J. Burkhart and J. Michael Johnson, urging granting of the writ
for amici curiae ATM Education, Buckeye Christian Schools Association, Church
Coalition for Decency, Citizens for Community Values, Citizens Media
Group/Christian Citizen USA, Constitution Party of Ohio, Eagle Forum of Ohio,
Eischen Financial Group, Evangelical Fellowship Chapel, Family First PAC,
Grove City Church of the Nazarene, Homemakers for America, Institute for
Principled Policy, Jobs Plus Employment Network, Mission America, New Hope
Christian Center, Ohio Governmental Prayer Alliance, Pass the Salt Ministries,
Richland Community Family Coalition, the Ridge Project, Inc., Rocky Fork
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January Term, 2009
Formulas, Inc., Sanctity of Life Foundation, Touch the World Ministry, Inc.,
Vandalia United Methodist Church, Victory in Truth Ministries, Women
Influencing the Nation, Pastor Peter J. Foxx, Ronald Hood, Stephen J. Koob,
Twyla Roman, and Pastor Wayne W. Scott.
Ulmer & Berne, L.L.P., and Donald J. Mooney Jr., urging denial of the
writ for amici curiae Ohio Federation of Teachers, Ohio School Business Officials
Association, Ohio Association of Public School Employees, Eve Bolton, and Jane
Simon.
Vorys, Sater, Seymour and Pease, L.L.P., and Suzanne K. Richards,
Richard D. Schuster, Michael R. Thomas, and Michael J. Hendershot, urging
denial of the writ for amici curiae Ohio Council of Retail Merchants and Ohio
Farm Bureau Federation.
__________________
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