Created on Thursday, 21 November 2013 Written by JULIE CARR SMYTH, AP Statehouse Correspondent
COLUMBUS, Ohio (AP) — After a high-profile fight for access to financial documents, Ohio's state auditor on Thursday cleared executives at Gov. John Kasich's embattled private job-creation office of business conflicts but scolded JobsOhio for lacking or failing to follow some internal monitoring procedures.
The compliance audit conducted by Republican Auditor Dave Yost, a former prosecutor, cited the fledgling economic development entity for eight procedural infractions during its first year of operation. JobsOhio says all the processes have been addressed since then, many of them voluntarily identified and remedied.
The review did not look at JobsOhio's fiscal soundness, a task that was handled earlier by KPMG.
With a subpoena, Yost had ordered JobsOhio to turn over its private books, as well as its public ones, for the review. The move was criticized by Kasich and fellow Republicans in the Legislature.
JobsOhio complied under protest in March. At the same time, it returned $1 million in taxpayer startup money in a move possibly aimed at shielding the office from future government scrutiny.
JobsOhio President and Chief Investment Officer John Minor Jr. announced the refund in tandem with answering Yost's subpoena for access to the private side of the office's books. JobsOhio, state legislative leaders and the Kasich administration argue the records aren't public.
Kasich had blasted Yost for an "attempt to re-write the law." Yost took the bold step of subpoenaing the records on March 6 from an office Kasich touts as Ohio's economic engine after JobsOhio failed to volunteer the records.
Yost insisted he had the right to audit both the public and private funds flowing through the public-private partnership. He cites a state law that says the auditor "may audit the accounts of private institutions, associations, boards, and corporations receiving public money for their use and may require of them annual reports in such form as the auditor of state prescribes."
Lawmakers have changed state law to clarify the disagreement, shielding future private spending from the state audit process.
JobsOhio received $1.5 billion from the sale of bonds backed by 25 years of state spirituous liquor profits. Its executives have said the profits are public money but the bond proceeds are not.
JobsOhio was created in 2011 after being spearheaded by Kasich to replace the bureaucracy at the former Ohio Department of Development and "move at the speed of business." JobsOhio received $1 million in taxpayer dollars to start and recently offered $1.5 billion in bonds backed by its long-term rights to Ohio's liquor business.
In an independent audit released Oct. 11, KPMG gave a clean bill of health to JobsOhio and the corporation it created with the liquor proceeds. The review of JobsOhio and JobsOhio Beverage System covered the fiscal year that ended June 30.
Yost has said he wants to make sure JobsOhio's money "is working for the people of Ohio — creating jobs and growing this economy for our families."