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In Toledo City School Dist. Bd. of Edn. v. State Bd. of Edn., the Ohio Supreme Court ruled that Article II, Section 28 of the Ohio Constitution, providing protection against retroactive laws, only applies to individuals and private corporations, not to local governments. The case arose out of funding reductions made by the Ohio Department of Education in 2005-2007 for the districts of Toledo, Dayton, and Cleveland. The districts filed suit in 2011 to recover the funds taken by the Department.

The Department argued that it was immune from liability under a 2009 state budget bill that specifically immunized the Department from claims made by school districts for the 2005-2007 funding reductions. The districts argued that the 2009 immunity provision was unconstitutionally retroactive.

The Court examined Ohio precedent that withheld protection from political subdivisions, and precedent from other states where similar laws were found to apply only to private individuals and corporations. The Court also stated that government bodies must be subject to alteration if change is deemed necessary. The majority opinion, issued on May 4, 2016 and written by Justice Kennedy, allows the state legislature to retroactively adjust local school funding.

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