The final steps in retooling the stateís economic development efforts are expected to begin tomorrow with approval of contracts to funnel the stateís liquor profits to a private operation. JobsOhio will use the revenue to attract new jobs and keep existing ones. After approval of the contracts, by a special legislative panel called the state Controlling Board, legislation to reorganize whatís left of the Department of Development into a new Development Services Agency will be introduced. Thatís expected in mid-February.
The liquor operation transfer originally was authorized by the state budget bill. For a one-time payment of $1.4 billion (the money raised from bonds), JobsOhio will tap a generous revenue stream for 25 years. In the 2011 fiscal year, the amount of liquor profits transferred to the General Revenue Fund was $153 million.
Meanwhile, questions linger about public accountability and transparency. John Kasich promotes the idea of a nimble, fast-paced JobsOhio, quickly responding to business needs and trends.
Yet the JobsOhio board is filled with those with close ties to the governor. Armond Budish, the House minority leader, is right to raise concerns, not only about the creation of a hole in the state budget, but also about whether adequate safeguards are in place once the money gets into JobsOhioís hands.
While JobsOhio will not take an equity position in new companies, it will make substantial loans, targeted to companies ready for mass production. The public deserves to know the details of the money flow, and how many jobs are created.
Details, released last week, about the contracts headed for the Controlling Board did reveal welcome news about stateís brownfield remediation program, its source of funding cut off by the diversion of liquor profits. The program, which cleans up abandoned industrial sites, has contributed much to urban redevelopment across the state. The program will get $43 million a year from JobsOhio for 25 years, enough to continue its solid record of success.
Whether JobsOhio can spin liquor profits into an economic rebound remains to be seen.