City of Columbus Blue Jackets’ Nationwide Arena Bailout Initiative (May 2014)

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City of Columbus Arena Bailout Initiative
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Type:Initiative
Referred by:Citizens
Topic:Public subsidy of sports arenas
Status:Proposed ballot measures that were not on a ballotNot on ballot

A City of Columbus Blue Jackets' Nationwide Arena Bailout Initiative also known as the Arena Bailouts Demand a Vote initiative did not make the May 6, 2014 election ballot for voters in the city of Columbus in Franklin County, Ohio.

If approved, this initiative measure would have put a stop to the city's payments on its purchase contract for the Columbus Blue Jackets' Nationwide Arena. It was in 2011 that the city and the county of Franklin agreed to pay about $250 million to purchase, operate and maintain the sports arena through 2039, ensuring the Blue Jackets team would remain in the city at least through the end of the contract. The measure proposed and petitioned by the Columbus Coalition for Responsive Government would have amended the ordinance authorizing the contract to suspend all payments until a public election was held on the issue.[1][2][3]

Columbus Coalition for Responsive Government submitted 17,200 to the city clerk on December 5, 2013.[4] Although there were more than enough signatures to qualify the initiative for the ballot, the Franklin County Board of Elections ruled the petitions invalid and barred the measure from the ballot. The board cited misleading language in the petitions and claimed that it might have provided false motivation for people who signed them. In particular, the board said the claim that the initiative would save $131 million was not necessarily true, as voters may have approved the arena in a later referendum. The board did admit that the measure could results in future savings for the city, but they insisted this was not a certain effect. They also stated that the amount could not be known.[5]

Text of measure

Title

The proposed ballot title is:[3]

Arena Bailouts Demand a Vote. To amend Section 2 of Ordinance 1596-2011, passed October 5, 2011, to prohibit appropriations for the purpose of financing Nationwide Arena effective January 1, 2016, absent a prior electoral vote in favor of such appropriations, and to repeal the existing Section 2 being amended.[6]

Summary

The proposed summary is:[3]

On October 5 2011, through Ordinance #1596-2011, the Council of the City of Columbus authorized the Mayor and/or Director of Finance and Management to enter into a Lease Agreement and Sublease agreement on behalf of the City among Franklin County, the Franklin County Convention Facilities Authority, and the City, and any other necessary agreements, for the purpose of facilitating part of the financing necessary for the Franklin County Convention Facilities Authority (“CFA”) to purchase, operate, and maintain Nationwide Arena, and to approve loan arrangements with the State of Ohio and the issuance of arena lease revenue bonds by the Franklin County Convention Facilities Authority for such purpose.

The existing Section 2 of Ordinance #1596-2011 anticipates that the City will provide specified percentages of the proceeds of the tax on gross casino revenue collected by the State and distributed to the City pursuant to Article 15, Section 6 of the Ohio Constitution (“the City Casino Taxes”) as the City contribution to the CFA over a 27 year period, which is to be made in the form of lease payments to the CFA, and that the City lease payments would be subject to annual certification of availability of such funds by the City Auditor and subsequent annual appropriations by City Council.

By this petition, filed under Section 41 of the Columbus City Charter, the petitioners seek to submit first to the council, and then to the electorate if the council defers, a proposed amendment to Ordinance #1596-2011 that would require the electors of the City of Columbus to authorize any and all future payments to the CFA made after January 1, 2016 for the purpose of financing Nationwide Arena. Through this proposed amendment, absent such prior approval by the electorate the city auditor would be prohibited from certifying the availability of funds and the city council would be prohibited from making annual appropriations after January 1, 2016.[6]

Columbus Blue Jackets goalie 30.jpg

Fiscal impact

The proposed statement of fiscal impact found on the petitions was:[3]

This amendment will result in savings for the City of Columbus in amounts ranging from $3.9 to $7.9 million per year, and totaling approximately $131,165,157 over the then-remaining period of the lease.[6]

Support

The Columbus Coalition for Responsive Government is the chief organization behind the initiative.[7]

Supporters

The five members of the commission that filed and signed the initiative petition form were:[3]

  • Robert J. Fitrakis
  • Willis E. Brown
  • Denise Benning
  • Suzanne Patzer
  • Jonathan C. Beard

Arguments in favor

Proponents of the initiative argued that using millions of dollars in public funding to subsidize the arena to ensure its survival amounts to a public bailout and should be approved by the voters.

Coalition president Jonathan Beard said, “This is not about the Blue Jackets — we say, ‘Go Jackets.' This is about what we believe to have been an abuse of the public’s trust in Columbus City Council.”[1]

Opposition

Arguments against

OSU law professor Stephanie Hoffer said that, if the measure is approved and stands up in court, it could cut off funding required by the Convention Facilities Authority to pay its bills and could even force the CFA to sell the arena and surrounding properties. She went on to say, “And that’s a really disastrous situation for the city. Not because of the legal consequences under this contract or under the law, but just because it really throws that particular area of the city into turmoil."[8]

Path to ballot

See also: Laws governing local ballot measures in Ohio

Columbus Coalition for Responsive Government submitted 17,200 to the city clerk on December 5, 2013. The group needed fewer than 5,000 of these signatures to be valid to qualify their initiative for the ballot. The city clerk certified 6,903 of the signatures and the county board of elections signed off on the petition. This sent the proposed ordinance to the city council, which planned to decide on January 6, 2014, whether to enact it or send it to the ballot.[1][4]

Columbus Coalition for Responsive Government submitted 17,200 to the city clerk on December 5, 2013.[4] Although there were more than enough signatures to qualify the initiative for the ballot, the Franklin County Board of Elections ruled the petitions invalid and barred the measure from the ballot. The board cited misleading language in the petitions and claimed that it might have provided false motivation for people who signed them. In particular, the board said the claim that the initiative would save $131 million was not necessarily true, as voters may have approved the arena in a later referendum even if this initiative passed. The board did admit that the measure could result in future savings for the city, but they insisted this was not a certain effect. They also stated that the amount could not be known.[5]

Legal controversy

Ohio State Moritz College of Law Professor Dale Oesterle predicted that, if the initiative qualified for the ballot, city lawyers would argue that it is invalid, citing a clause in the constitution that says a governmental unit cannot retroactively change a contract.[8]

Oesterle expressed doubt that the clause applies to the city's arena deal, but called the law unclear. Oesterle thought the referendum could hold legal muster. He said, "Citizens can do this." Oesterle explained that the Columbus City Charter allows voters to create a new ordinance through the initiative power. He went on to say, "This is an effort to put a new ordinance on the books which, in essence, affects the operation of an old ordinance that they disagree with. It’s very clever, actually.”[8]

OSU law professor Stephanie Hoffer pointed out that the lease agreement in question requires the city of Columbus make every effort to approve funding for the arena contract payments, which could mean the city has a duty, under contract, to campaign against the measure. Hoffer said, “I think the city is probably required to do a little bit of advertising to the public to try to prevent the initiative from passing.”[8]

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