School & District Management

Lemons for Ohio on Slots Revenue

By Michele McNeil — September 29, 2009 1 min read
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Ohio officials are weighing their next move after the Ohio Supreme Court dealt a huge blow to Gov. Ted Strickland, the legislature, and public school advocates by ruling that the legalization of slot-like machines at horse-racing tracks is subject to a statewide referendum.

The ruling last week zapped—at least temporarily—about $850 million from the state’s fiscal 2010-2011 two-year budget, money that was to pay for K-12 education.

When the legislature approved the state budget in July, it plugged a deficit by cutting $2 billion from its spending plan and by adding projected revenue from new video-lottery terminals, similar to slot machines, that were set to appear later this year at the state’s seven horse-racing tracks.

But opponents, who organized under LetOhioVote.org, filed a petition with the secretary of state’s office asking that the issue be put to a statewide vote. After the secretary of state rejected the petition, the group took the case to the state Supreme Court.

Gov. Strickland, a Democrat, said his office needs to review the ruling before determining his next steps.

The ruling comes at a bad time for the governor, who is trying to overhaul the state’s school funding system based on a formula that officials say directs money to where it’s needed most.

The 6-1 ruling, which declared the video-lottery terminals are subject to the referendum process, made clear that the justices knew how much money was at stake.

“We are not unmindful of the effect our decision may have on the state budget,” Justice Terrence O’Donnell wrote for the majority. However, he said, “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.”

Justice Paul E. Pfeifer, the lone dissenter, disagreed. He said the legislation authorizing video-lottery terminals is “at the very heart of how Ohio is going to pay for its spending over the next two years.”

Meanwhile, LetOhioVote.org has resubmitted its petition to place the issue on the November 2010 ballot.

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A version of this article appeared in the September 30, 2009 edition of Education Week as Lemons for Ohio on Slots Revenue

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