# Ohio Historical Soc. v. State Emp. Relations Bd.

> Ohio Supreme Court · June 22, 1993 · 1993 Ohio 182

URL: https://www.frixlaw.com/law-library/cases/11147521

## Case

- **Court:** Ohio Supreme Court
- **Decided:** June 22, 1993
- **Citations:** 1993 Ohio 182
- **Precedential status:** Published
- **Opinion:** Opinion
- **Judges:** Wright, J.
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

OPINIONS OF THE SUPREME COURT OF OHIO
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Ohio Historical Society, Appellee, v. State Employment
Relations Board et al., Appellants.
[Cite as Ohio Historical Soc. v. State Emp. Relations Bd.
(1993), Ohio St.3d .]
State Employment Relations Board -- Exclusive jurisdiction to
decide matters committed to it pursuant to R.C. Chapter
4117 -- Common pleas courts may not exercise jurisdiction
over claims in declaratory judgment action that arise from
rights created by R.C. Chapter 4117.
(No. 91-2536 -- Submitted February 3, 1993 -- Decided June
23, 1993.)
Appeal from the Court of Appeals for Franklin County, Nos.
91AP-97 and 91AP-98.
This is an appeal from a judgment of the Court of Appeals
for Franklin County which held that appellee, the Ohio
Historical Society ("the Society"), is not a "public employer"
for the purposes of R.C. Chapter 4117.
This litigation began in 1984 when appellant Ohio Council
8, American Federation of State, County and Municipal
Employees, AFL-CIO ("AFSCME") filed a petition for
representation election with appellant State Employment
Relations Board ("SERB"). AFSCME sought to represent certain
employees of the Society for the purpose of collective
bargaining.
At approximately the same time as it filed its petition
with SERB, AFSCME filed a petition for certification of
representation with the National Labor Relations Board
("NLRB"). On June 14, 1984, the NLRB regional director to whom
the petition was assigned dismissed the petition on the grounds
that the Society is a "political subdivision" under federal
law. The NLRB denied AFSCME's request that it review the
regional director's decision.
The Society moved to dismiss AFSCME's state petition for
representation election on the very grounds we consider today:
that it is not a "public employer" as defined in R.C.
4117.01(B) and that SERB, therefore, does not have jurisdiction
over it. In response to the Society's motion, SERB directed a
hearing to be held to determine, inter alia, whether the
Society is a public employer.
After hearing evidence presented by the parties, the SERB
hearing officer concluded that the Society is a public employer
under R.C. Chapter 4117 and issued a recommendation to SERB
that it adopt that position. In February 1986, SERB issued an
order finding the Society to be a public employer and directed
that a representation election be held.
Using two procedural routes, the Society sought relief
from the SERB order in the Court of Common Pleas of Franklin
County. It filed an appeal from the SERB order pursuant to
R.C. 119.12. Both SERB and AFSCME moved to dismiss the appeal
on the grounds that the court lacked subject matter
jurisdiction. The Society also filed a complaint for
declaratory judgment pursuant to R.C. Chapter 2721. The court
dismissed the Society's declaratory judgment action because, it
concluded, the Society was entitled to appellate review under
R.C. 119.12. The court then held that the Society is not a
public employer and is, therefore, not subject to SERB's
jurisdiction.
The court of appeals reversed. It held that the trial
court did not have jurisdiction over the Society's R.C. 119.12
appeal because an appeal was premature. The court also
reversed the trial court's dismissal of the Society's
declaratory judgment action. It ruled that consideration of
that action was within the sound discretion of the trial court.
The Society appealed to this court and we accepted
jurisdiction. The only issue before the court was "whether
[the Society] can appeal the adjudication order issued by
SERB[.]" Ohio Historical Soc. v. State Emp. Relations Bd.
(1990), 48 Ohio St.3d 45, 46, 549 N.E.2d 157, 158. The issue
of whether the trial court could entertain the declaratory
judgment action was not before the court because that portion
of the court of appeals' decision was not appealed. Id. at 48,
549 N.E.2d at 160. As to the question of whether the R.C.
119.12 appeal was proper, we affirmed the judgment of the court
of appeals. We held that because the election ordered by SERB
had not yet taken place, SERB's order was not a final order and
was, therefore, not yet appealable to the common pleas court.
In response to our decision, the common pleas court issued
an order holding both the R.C. 119.12 appeal and the
declaratory judgment action in abeyance pending the outcome of
the representation election ordered by SERB. In April 1990,
SERB conducted the scheduled election; AFSCME, however, was not
successful in obtaining the votes necessary to be certified as
the Society's employees' exclusive bargaining agent.
After AFSCME lost the representation election, the Society
moved to renew its R.C. 119.12 appeal in the common pleas
court. In December 1990, the court issued its decision. It
held that the Society is not a public employer for purposes of
R.C. Chapter 4117. The case number appearing in the caption of
the decision indicated that it was on the R.C. 119.12 appeal
alone. The caption of the court's January 4, 1991 journal
entry, however, listed the case numbers for both the
declaratory judgment action and the R.C. 119.12 appeal.
SERB and AFSCME appealed the trial court's decisions to
the Court of Appeals for Franklin County. The court
of appeals affirmed. It held that the trial court had
jurisdiction to consider the declaratory judgment action
and that the Society is not a public employer under R.C.
4117.01(B).
The cause is now before this court upon the allowance of
AFSCME's and SERB's motions to certify the record.

Vorys, Sater, Seymour & Pease and James P. Friedt; Fred J.
Milligan, Jr., Assistant Attorney General, for appellee.
Lee I. Fisher, Attorney General, and Toki M. Clark, for
appellant SERB.
Ronald H. Janetzke, for appellant Ohio Council 8, AFSCME.

Wright, J.
I
AFSCME argues that pursuant to this court's decision in
Franklin Cty. Law Enforcement Assn. v. Fraternal Order of
Police, Capital City Lodge No. 9 (1991), 59 Ohio St.3d 167, 572
N.E.2d 87, inter alia, the common pleas court did not have
jurisdiction to hear the Society's declaratory judgment
action. We agree.
The court of appeals held that the issue of whether the
Society is a public employer is "properly determinable by
declaratory judgment." In doing so it cited our opinion in
Ohio Historical Soc. v. State Emp. Relations Bd.(1990), 48 Ohio
St.3d 45, 549 N.E.2d 157 ("Historical Soc. I"). This reliance
was improper, however, because we expressly declined to
consider the issue, since it was not before this court on
appeal. Id. at 48, 549 N.E.2d at 160. The issue was squarely
before the court, however, in Franklin Cty. Law Enforcement
Assn., supra, which was decided the following year. It is this
precedent which we must follow.
In Franklin Cty. Law Enforcement Assn., this court
considered whether the common pleas court had jurisdiction to
entertain a complaint requesting preliminary and permanent
injunctions and a declaratory judgment. We decided that
because the matters alleged in the complaint are governed
exclusively by the Ohio Public Employees' Collective Bargaining
Act, R.C. Chapter 4117, the trial court could not exercise
jurisdiction. "The State Employment Relations Board has
exclusive jurisdiction to decide matters committed to it
pursuant to R.C. Chapter 4117." Id. at paragraph one of the
syllabus. Writing for the court, Chief Justice Moyer explained
that "R.C. Chapter 4117 has created a series of new rights and
set forth the remedies and procedures to be applied regarding
those rights. *** [T]hose remedies and procedures are
exclusive." Id. at 170, 572 N.E.2d at 90. The "procedures
created in R.C. Chapter 4117 do not provide for the filing of a
private action in the common pleas court." Id. When a
complainant in a labor relations case asserts rights that are
completely independent of R.C. Chapter 4117, the common pleas
court may exercise jurisdiction. However, "[i]f a party
asserts claims that arise from or depend on the collective
bargaining rights created by R.C. Chapter 4117, the remedies
provided in that chapter are exclusive." Id. at 171, 572 N.E.2d
at 91.
The only substantive allegation in the Society's complaint
for declaratory judgment was that it is not a public employer.
Resolution of this allegation depends entirely on the
provisions of R.C. Chapter 4117, over which SERB has exclusive
original jurisdiction. Determination of its jurisdiction over
a petition for a representation election is to be decided, in
the first instance, by SERB. Id. at 169-170, 572 N.E.2d at
90-91.
R.C. Chapter 4117 "was meant to regulate in a
comprehensive manner the labor relations between public
employees and employers." Id. at 171, 572 N.E.2d at 91. The
Declaratory Judgments Act, R.C. Chapter 2721, was not intended
to be used to circumvent such comprehensive agency processes.
SERB has exclusive jurisdiction to consider issues concerning
petitions for representation elections. Common pleas courts
are limited to appellate jurisdiction, at the proper time, over
these and other matters arising under R.C. Chapter 4117. As to
this issue the judgment of the court of appeals is reversed.
II
AFSCME also argues that the courts below did not use the
proper standard of review in reaching their decisions. The
lower courts were considering both the R.C. 119.12
administrative appeal and the declaratory judgment action filed
by the Society. In light of our disposition of the Society's
declaratory judgment action, the issue presented to us is
whether the courts below exercised the proper standard of
review over the Society's administrative appeal.
Generally, appeals to the common pleas courts from agency
adjudications are governed by Ohio's Administrative Procedure
Act, which is codified in R.C. Chapter 119. "[E]xcept where
specific appeal procedures are provided, such as R.C.
4117.13(D) (unfair labor practices)[1] and R.C. 4117.23
(penalty for unlawful strike), or where appeals to a court are
prohibited, such as R.C. 4117.06(A) (determination of unit
appropriate for collective bargaining purposes), the general
provisions of R.C. 119.12 govern the appealability of an
adjudication order issued by SERB." Historical Soc. I, supra,
48 Ohio St.3d at 46, 549 N.E.2d at 158.
R.C. 119.12 provides in part: "The court [of common
pleas] may affirm the order of the agency complained of in the
appeal if it finds, upon consideration of the entire record and
such additional evidence as the court has admitted, that the
order is supported by reliable, probative, and substantial
evidence and is in accordance with law." This standard
requires two inquiries: a hybrid factual/legal inquiry and a
purely legal inquiry.
In Univ. of Cincinnati v. Conrad (1980), 63 Ohio St.2d
108, 17 O.O.3d 65, 407 N.E.2d 1265, and Andrews v. Bd. of
Liquor Control (1955), 164 Ohio St. 275, 58 O.O. 51, 131 N.E.2d
390, this court described the hybrid factual/legal inquiry
required by R.C. 119.12. "It is obvious that, if the General
Assembly had intended the appeal provision to afford a trial de
novo, the court would be required to hear all material,
relevant and probative evidence which either party might desire
to present. On the other hand, the language of [then recently
amended R.C. 119.12] extends the authority of the Common Pleas
Court, upon appeal, beyond that court's former authority which
did not permit it to substitute its judgment for that of the
agency and which confined it to determining the rights of the
parties in accordance with the statutes and law applicable."
Andrews, supra, at 279-280, 58 O.O. at 53, 131 N.E.2d at 393.
In undertaking its review, the common pleas court must give
deference to the agency's resolution of evidentiary conflicts,
but "the findings of the agency are by no means conclusive."
Conrad, supra, at 111, 17 O.O.3d at 67, 407 N.E.2d at
1267-1268. "Where the court, in its appraisal of the evidence,
determines that there exist legally significant reasons for
discrediting certain evidence relied upon by the administrative
body, and necessary to its determination, the court may
reverse, vacate or modify the administrative order." Id. at
111, 17 O.O.3d at 67, 407 N.E.2d at 1268. We take this
precedent to mean that an agency's findings of fact are
presumed to be correct and must be deferred to by a reviewing
court unless that court determines that the agency's findings
are internally inconsistent, impeached by evidence of a prior
inconsistent statement, rest upon improper inferences, or are
otherwise unsupportable. See id. at 111-112, 17 O.O.3d at 67,
407 N.E.2d at 1268. The agency's order survives the first
prong of the common pleas court's review if the court finds
that the evidence the agency relied on is indeed "reliable,
probative, and substantial."
Andrews recognized that even before R.C. 119.12 was
amended to require reviewing courts to make the hybrid inquiry
described above, courts were to determine "the rights of the
parties in accordance with the statutes and law applicable."
Andrews, supra, 164 Ohio St. at 280, 58 O.O. at 53, 131 N.E.2d
at 393. Under R.C. 119.12, a reviewing court is obligated to
determine whether the agency's decision is "in accordance with
law." An agency adjudication is like a trial, and while the
reviewing court must defer to the lower tribunal's findings of
fact, it must construe the law on its own. To the extent that
an agency's decision is based on construction of the state or
federal Constitution, a statute, or case law, the common pleas
court must undertake its R.C. 119.12 reviewing task completely
independently.
AFSCME argues that the common pleas courts must affirm
SERB orders as long as they are supported by "reliable,
probative, and substantial evidence." This is an incomplete
statement of the proper standard of review. The Society
correctly points out that the courts must also exercise
independent judgment as to matters of law.
In this case none of the parties has argued that the SERB
hearing officer's findings of fact are not supported by
"reliable, probative, and substantial evidence." Thus, the
inquiry for the reviewing courts is whether, accepting the
facts found by the hearing officer as true, the Society is a
public employer, as a matter of law, under R.C. 4117.01(B). We
find that the courts below properly limited their review to
this purely legal question.
III
A
The origins and development of the Society were detailed
in a 1974 report prepared by the Society for Governor Gilligan
and the General Assembly. Ten Year Plan of the Ohio Historical
Society (June 1974) 5-7. The report's discussion of the
organization's history highlights the tension between the
Society's public and private roles:
"Ohio's prehistoric Indian sites were being looted of
their primitive art treasures. State archives were being
removed from the State House. The personal papers of Ohio
leaders were being destroyed or dispersed. No state
organization existed to halt the loss of Ohio's patrimony."
Id. at 5.
In 1884, Governor Hoadly and the Secretary of State began
looking for supporters to form a historical society. On March
12, 1885, one hundred and fifty citizens met in the Ohio Senate
chamber and organized the Society. Id.
"The interest of a combination of public officials and
private persons in the creation of a state historical agency
cast the newly formed group into a quasi-public, quasi-private
framework. Governor Hoadly and the other founders envisioned
the Society as becoming a large and effectively administered
museum and library institution. They expected the organization
to assume a leadership role in the cultural life of the state.
To achieve these ambitious objectives, the founders anticipated
state support of historical activities, a desire promptly
translated into reality." Id. at 5-6.
The informal arrangement between the private, non-profit
Society and the state of Ohio lasted until 1963 when that
relationship was questioned in the courts. Id. at 7. A
declaratory judgment action was brought in Franklin County
Common Pleas Court to determine "whether or not the Society's
policies and procedures, particularly in regard to the handling
of funds of a private source, should be administered strictly
in accordance with the regulations governing state government
operations." Id. The court held that the Society was a
private, non-profit corporation and was, therefore, required to
operate under laws governing corporations rather than under the
procedures and regulations that apply to state agencies. The
court also held, however, that a new basis for state support of
the Society's public functions had to be enacted. The General
Assembly responded to the court's decision by amending R.C.
149.30 to create a situation in which a formal contractual
relationship could exist between the state and the Society. Id.
In considering the petition for representation election
filed by AFSCME in this case, the SERB hearing officer made
findings of fact that were adopted by SERB (with modifications
not relevant here) in its decision. These undisputed findings
paint a picture of the Society as it is today. Among them are
the following:
(1) The Society is governed by a constitution which was
written and adopted by its members. The constitution vests the
government of the Society in a board of trustees ("board").
The board includes eighteen members, nine of whom are elected
from the membership and nine of whom are appointed by the
Governor. The officers of the corporation are elected annually
by the board.
(2) The board is responsible for formulating and
approving the policies of the society, including personnel and
labor relations policies.
(3) The Society by-laws provide that the board delegates
administrative duties for the operation of the Society to a
director, who acts as the chief administrative officer. The
board establishes the terms of the director's employment.
(4) The wages, terms, and conditions of employment of all
employees are set by the board.
(5) The Society is, in part, self-supporting. It
generates revenue from, among other things, admission fees to
museums and other historic sites, the sale of meals, and the
sale of goods and other services.
(6) The Society enters into contractual relationships
with different public and private entities for the provision of
services.
(7) The Society contracts with the state of Ohio to
perform certain public functions designated in R.C. 149.30 for
which the Society receives public funds.
(8) Approximately sixty-five to seventy percent of the
Society's total operating budget is comprised of state
appropriations. This money funds services contracted for
between the Society and the state. The remaining thirty to
thirty-five percent of the Society's operating budget
represents private money from retail sales, admission fees,
membership dues, private donations, contract fees and other
similar activities.
(9) Society wage rates and salary increases are
comparable to those of the state. No specific legislative or
state approval is necessary for granting a Society wage
increase.
(10) Society employees participate in the Public
Employees Retirement System.
(11) Society employees are not covered by Ohio civil
service laws.
(12) The Society is not required to consult or obtain
approval from the state as to any matter relating to employment
policies.
(13) The Auditor of State is required to annually examine
the Society's records.
(14) Former state employees hired by the Society receive
credit for state work time.
(15) The Society has a regular mail pick-up at the Ohio
Statehouse.
(16) Approximately ninety-five percent of the Society's
1985 funds for capital improvements came from the state.
(17) The Society does not use the same rule-making
procedures as state agencies do.
(18) The Society has a state agency number for
identification purposes in the state budget.
Based upon these and other findings of fact, the SERB
hearing officer concluded that the Society is a "public
employer" under R.C. 4117.01(B). SERB came to the same
conclusion, and recognized that "a respectable argument could
be mounted that the Society is a public employer based on the
similarities between the functions of the society and those of
state government." SERB, however, rested its decision on the
ground that because Society employees are "public employees"
under R.C. 4117.01(C), the Society is necessarily a public
employer under R.C. 4117.01(B).
This appeal presents three issues for the court's
consideration. The first is whether the common pleas court had
jurisdiction to consider the Society's declaratory judgment
action. The second is whether the common pleas court and the
court of appeals used the proper standard of review in
considering the Society's R.C. 119.12 appeal from SERB's
decision. The third is whether the Society is a "public
employer" under R.C. 4117.01(B).
B
The substantive issue presented by this case is whether
the Society is a "public employer" under R.C. 4117.01(B). If
the Society is a public employer, SERB may exercise
jurisdiction over it for labor relations purposes. See
Cincinnati Metro. Hous. Auth. v. State Emp. Relations Bd.
(1990), 53 Ohio St.3d 221, 560 N.E.2d 179. Both R.C.
4117.01(B) and 4117.01(C) are relevant to the parties'
arguments and our disposition. R.C. 4117.01(B) provides:
"'Public employer' means the state or any political
subdivision of the state located entirely within the state
including, without limitation, any municipal corporation with a
population of at least five thousand according to the most
recent federal decennial census, county, township with a
population of at least five thousand in the unincorporated area
of the township according to the most recent federal decennial
census, school district, state institution of higher learning,
any public or special district, any state agency, authority,
commission, or board, or other branch of public employment."
(Emphasis added.)
R.C. 4117.01(C) provides:
"'Public employee' means any person holding a position by
appointment or employment in the service of a public employer,
including any person working pursuant to a contract between a
public employer and a private employer and over whom the
national labor relations board has declined jurisdiction on the
basis that the involved employees are employees of a public
employer[.]" It then lists fifteen specific groups of
employees that are not included in the definition of "public
employees."
Under R.C. 4117.01(B) an entity is a public employer if it
is one of three things: (1) the state, (2) a political
subdivision of the state, or (3) an "other branch of public
employment." We come to this conclusion by way of the plain
language of the statute. "[T]he state" and "any political
subdivision of the state" are defined to include ten specific
government entities (any "municipal corporation with a
population of at least five thousand * * *, county, township
with a population of at least five thousand * * *, school
district, state institution of higher learning, any public or
special district, any state agency, authority, commission, or
board"). The words "without limitation," however, indicate
that entities considered "the state" or a "political
subdivision" are not limited to those listed. After the final
example of a state or political subdivision is listed (a
board), the definition of public employer somewhat vaguely
reaches "other branch[es] of public employment."
SERB argues that the Society is a public employer because
it fits under all three categories set forth in R.C.
4117.01(B). It asserts that the Society is "the state" because
the state of Ohio has turned over significant state functions
to the Society and substantially funds its operations. SERB's
position is that the Society has become, at least, a de facto
state agency. SERB also argues that the Society is a
"political subdivision of the state" because it was "created
for a public purpose, [and] authorized to exercise a limited
portion of the sovereign power of the state." Finally, SERB
asserts that the Society is a "branch of public employment" for
two reasons: the Society has the "attributes" of a public
employer and its employees are public employees under R.C.
4117.01(C). SERB states that "[t]he General Assembly could not
have intended the ludicrous result urged by [the Society] that
'public employees' do not work for 'public employers' and do
not have the right to collectively bargain specifically granted
them in R.C. 4117.03."
AFSCME focuses its argument on SERB's last point: that
the definitions of "public employer" and "public employee" must
be read together and in light of the policies of the labor
law. AFSCME asserts that "[a] private not for profit
corporation can be a public employer and its employees public
employees as those terms are defined in R.C. [Chapter] 4117 as
R.C. 4117.01(B) and R.C. 4117.01(C) must be read in pari
materia." It argues that Society employees are public
employees under R.C. 4117.01(C) and that, therefore, the
Society is a "branch of public employment."
The Society argues that the General Assembly could have
extended its definition of "public employer" to private
entities such as the Society but chose not to do so. Instead,
the Society argues, the legislature "intended to limit the
application of the Act to truly public entities." (Emphasis
sic.) It reasons that an entity can be "public" or "private"
but not both -- the terms are mutually exclusive.
The Society places heavy reliance on our decision in
Cincinnati Metro. Hous. Auth. v. State Emp. Relations Bd.,
supra ("CMHA"). One issue in that case was whether CMHA is a
"public employer" and is subject to SERB's jurisdiction under
R.C. Chapter 4117. This court cited R.C. 4117.01(B) and
concluded that "the General Assembly clearly intended to
include within such definition any state-created public body
such as CMHA." Id., 53 Ohio St.3d at 224, 560 N.E.2d at 182.
We reasoned that because a metropolitan housing authority is
defined as "a body corporate and politic" under R.C. 3735.31
and "political subdivision" has been defined to include bodies
"corporate and politic," CMHA is a public employer under R.C.
Chapter 4117. The Society argues that our decision in CMHA
holds that only "state-created public bod[ies]" can be "public
employers."
The court of appeals agreed with the Society. The court
held that "R.C. Chapter 4117 is strictly limited in its
application to the regulation of employment relations between
public employers and public employees. It has no application
to the private sector." The court reasoned that while R.C.
149.30 gives the Society many attributes of a public entity,
"nothing contained in that statute has altered the basic legal
status of [the Society] as a private, non-private [sic]
corporation."
1
SERB's position that the Society is a state or a political
subdivision is not persuasive. The issue is not, as SERB would
have it, whether the Society possesses a larger or smaller
number of the attributes of a government entity. The issue is
straightforward: whether the Society is in fact a government
entity. Quite simply, the Society is not public; it was
neither created by the state nor is it subject to state control.
The Society is a private, not-for-profit corporation. It
was created by a group of individuals, in their capacities as
private citizens, "[t]o promote a knowledge of archaeology and
history, especially in Ohio * * * ." Section 1, Article II,
Constitution of the Ohio Historical Society. The SERB hearing
officer found that the Society is governed by a constitution
written and adopted by its members; the constitution may be
amended by a simple majority of votes cast by Society members.
A board of trustees ("board") runs the Society. The corporate
constitution, not a state statute, provides that half of the
trustees are elected from the Society's membership and half are
appointed by the Governor of Ohio. The board elects corporate
officers to operate the Society and these officers report
directly to the board. The Society is, in short, not a public
or government entity. It was neither created by the state nor
is it subject to state control. In both form and substance the
Society is a private corporation.
Neither the Society leaders nor its members are subject to
the political process. The members of its board, whether
appointed by the Governor or elected by the membership, are
responsible to the membership of the Society alone. Its
corporate officers are responsible to the board alone. Neither
directly nor indirectly do the citizens of the state of Ohio
exercise control over the Society. Simply because a large
portion of the Society's budget is derived from public funds
does not render it a state agency.
The fact that the Society has a close relationship with
the state does not make it an arm of the state. The Society's
relationship with the state is based on contract. The Society
contracts with the state to perform certain public functions
designated in R.C. 149.30 for which the Society receives public
funds. It is authorized by its constitution to enter into
contracts with the state. The state is authorized to contract
with the Society by R.C. 149.30. Nowhere, however, is the
Society required by statute to perform state functions.
Moreover, the Society is not one of the ten entities
specifically deemed to be "the state or any political
subdivision of the state" by R.C. 4117.01(B). The Society is
not a municipal corporation, a county, a township, a school
district, an institution of higher learning, a public or
special district, a state agency, authority, commission, or
board.
The General Assembly could have expressly included
entities like the Society in its definition of "public
employer." In 1970, fourteen years before the General Assembly
adopted the current definition of "public employer," the
Pennsylvania legislature adopted a definition of "public
employer" that almost certainly would include the Society. In
the Pennsylvania Public Employee Relations Act, 43 P.S. Section
1101.101 et seq., the definition of "public employer" expressly
includes "any nonprofit organization or institution ***
receiving grants or appropriations from local, State or Federal
governments ***." 43 P.S. Section 1101.301(1). Our General
Assembly apparently chose not to follow Pennsylvania's
example.
The Society is also not a "political subdivision" under
state law.2 R.C. Chapter 4117 does not specifically define
"political subdivision" and there is no general statutory
definition of "political subdivision." In the absence of
specific definitions, however, case law and Attorney General
opinions provide a general definition: "A political
subdivision is a limited geographical area of the State, within
which a public agency is authorized to exercise some
governmental function." 1972 Ohio Atty. Gen. Ops. No. 72-035
(citing other authorities). Because the Society does not
exercise governmental authority in a limited geographical area,
it is not a political subdivision.
2
The question of whether the Society is an "other branch of
public employment" is more difficult to resolve. AFSCME's
position is, essentially, that the General Assembly intended to
give all public employees, except those specifically excluded
from coverage, the right to collectively bargain under state
law and that the Society's employees are "public employees"
under R.C. 4117.01(C). The Society's position is that only
employees of truly public entities have the right to
collectively bargain under Ohio law.
AFSCME argues that employees of the Society are public
employees pursuant to R.C. 4117.01(C). A "public employee" is
a person in the service of a public employer, including "any
person" (1) "working pursuant to a contract between a public
employer and a private employer" and (2) "over whom the
national labor relations board has declined jurisdiction on the
basis that the involved employees are employees of a public
employer." R.C. 4117.01(C). We agree that the Society's
employees fit the second prong of this test: the NLRB declined
to take jurisdiction over the employees because, under federal
law, they are considered employees of a political subdivision.
In so holding, the NLRB cited the National Labor Relations Act,
Section 2(2) (Section 152[2], Title 29, U.S. Code), and Natl.
Labor Relations Bd. v. Natural Gas Util. Dist. of Hawkins Cty.
(1971), 402 U.S. 600, 91 S.Ct. 1746, 29 L.Ed.2d 206.
We do not believe, however, that Society employees are
"working pursuant to a contract between a public employer and a
private employer." The record does not show that certain
Society employees are hired to perform discrete tasks, all of
which are "in the service of" the state of Ohio. Society
employees are employed to do the work of the Society -- some of
which is the private work of the Society and some of which may
be characterized as public work pursuant to a contract with the
state. The employees are paid from Society, not state, funds.
While sixty-five to seventy percent of the Society's budget is
comprised of state appropriations, thirty to thirty-five
percent of its budget comes from independent Society revenue
raising. The SERB hearing officer found that the Society
generates its own revenues from admission fees to museums, the
sale of meals, and the sale of goods and other services. Thus,
we cannot say that Society employees are employed solely as a
result of the Society's contractual relationship with the
state. The Society's privately funded work is inextricably
intertwined with the Society's publicly funded work. Its
employees are, therefore, not "public employees."
Moreover, as discussed above, the Society is a private
entity. Whatever the policy reasons for treating the Society
as a "branch of public employment," we cannot do so without
support from the language or structure of R.C. Chapter 4117.
If its employees were "public employees" under R.C. 4117.01(C),
we could conclude that the Society is a "branch of public
employment." But such is not the case. The Society is a
private entity and, accordingly, we hold that the Society is
not a public employer under R.C. 4117.01(B).
The judgment of the court of appeals as to this issue is
affirmed.
Judgment affirmed in part
and reversed in part.
Moyer, C.J., and Pfeifer, J., concur.
Douglas, J., concurs separately.
A.W. Sweeney, Resnick and F.E. Sweeney, JJ., dissent.

FOOTNOTE:
1 See Lorain City Bd. of Edn. v. State Emp. Relations Bd.
(1988), 40 Ohio St.3d 257, 533 N.E.2d 264. The standard of
review applied in Lorain ("[t]he findings of the board as to
the facts, if supported by substantial evidence on the record
as a whole, are conclusive") is specifically provided in R.C.
4117.13(D) to be used by courts reviewing SERB determinations
of unfair labor practices. See Lorain City Bd. of Edn. at 259,
533 N.E.2d at 266.
2 The NLRB regional director concluded that, under the
National Labor Relations Act, Section 151 et seq., Title 29,
U.S. Code, the Society is a "political subdivision." In Natl.
Labor Relations Bd. v. Natural Gas Util. Dist. of Hawkins Cty.
(1971), 402 U.S. 600, 602-603, 91 S.Ct. 1746, 1748, 29 L.Ed.2d
206, 209, the United States Supreme Court held that "[f]ederal,
rather than state, law governs the determination, under {2(2)
[of the Act] whether an entity created under state law is a
'political subdivision' of the State and therefore not an
'employer' subject to the Act."
Ohio Historical Soc. v. State Emp. Relations Bd.
Douglas, J., concurring. The only real issue presented
by this case is whether the Ohio Historical Society ("OHS") is
a "public employer." The court of appeals, in its opinion,
identified the question as "[t]he singular issue before us * *
*." Appellant SERB and appellee OHS did not brief or argue,
except in a general way, the other issues commented on and
decided by the majority.
Is OHS a public employer pursuant to R.C. 4117.01(B)? I
think not and I concur with the majority's discussion of the
issue as found in Part III(B)(1) and (2) of the majority
opinion. While OHS may have some of the indicia of a public
employer, and while it may even walk like, look like and quack
like a public employer, the fact remains that it is still a
private not-for-profit corporation and, under these peculiar
circumstances, cannot be a public employer.
I note in passing, as the majority does in fn. 2, that the
regional director of the NLRB has concluded that OHS is, under
federal law, a "political subdivision." Given our decision
today, I would respectfully suggest that this matter be
reviewed by proper authorities given the test set forth and
approved by the United States Supreme Court in Natl. Labor
Relations Bd. v. Natural Gas Util. Dist. of Hawkins Cty.
(1971), 402 U.S. 600, 91 S.Ct. 1746, 29 L.Ed.2d 206.
Ohio Historical Soc. v. State Emp. Relations Bd.
Alice Robie Resnick, J., dissenting. Although I have
misgivings about the manner in which the majority resolves some
of the procedural matters in this case, I limit my discussion
to the principal issue presented. That issue is whether the
Ohio Historical Society ("the Society") is a "public employer"
for purposes of R.C. Chapter 4117. A thoughtful consideration
of relevant statutory provisions points to one inescapable
conclusion: Even if one accepts the somewhat dubious
assumption that the Society is a private corporation, the
Society is clearly a "public employer" as that term is used in
R.C. 4117.01(B). The majority's determination that the Society
is not a public employer is irreconcilable with the undisputed
facts underlying this case. I dissent.
I
The employees of the Society are "public employees"
pursuant to R.C. 4117.01(C), and therefore their employer must
be a "public employer" pursuant to R.C. 4117.01(B), because the
Society inescapably is an "other branch of public employment"
as specified in the last phrase of R.C. 4117.01(B).
R.C. 4117.01(C) specifically provides that the term
"public employee" includes any person who works "pursuant to a
contract between a public employer and a private employer and
over whom the national labor relations board ['NLRB'] has
declined jurisdiction on the basis that the involved employees
are employees of a public employer[.]" (Emphasis added.) I
believe that the General Assembly, through this provision, was
addressing precisely the situation presented by this case.
SERB's order finding the Society to be a public employer relied
on R.C. 4117.01(C). While SERB noted that "a respectable
argument could be mounted that the Society is a public employer
based on the similarities between the functions of the
[s]ociety and those of state government," SERB realized there
was no need to entertain that inquiry. The Society's employees
clearly fit the definition of "public employees" contained in
the "including" language of R.C. 4117.01(C).
It is apparent that employees of the Society work pursuant
to a contract between the state and the Society. The majority
even seems to recognize this, stating that "[t]he Society's
relationship with the state is based on contract. The Society
contracts with the state to perform certain public functions
designated in R.C. 149.30 for which the Society receives public
funds." However, the majority appears to reason that, because
the Society's privately funded work and publicly funded work
are "inextricably intertwined," the Society's employees are not
working "solely" pursuant to a contract with the state, and
thus are not "public employees." However, the word "solely"
does not appear anywhere in R.C. 4117.01(C). As noted by the
majority, the Society performs numerous public functions and
receives approximately sixty-five to seventy percent of its
total operating budget from state appropriations. It is clear
that the Society's employees work "pursuant to a contract" with
the state. Because the NLRB has already declined jurisdiction
over the Society's employees, both requirements of R.C.
4117.01(C) are met, and the Society's employees are "public
employees."
The concurring opinion seems to intimate that the NLRB
erred by declining to exercise jurisdiction over the
employees. However, the propriety of the NLRB's determination
actually is irrelevant. What is of consequence is that the
NLRB ruled as it did, thereby fulfilling one of the specific
requirements of R.C. 4117.01(C). Moreover, the General
Assembly, when it enacted R.C. Chapter 4117, attempted to
provide that all employees in Ohio would be covered either by
that chapter (if public employees) under SERB's jurisdiction
unless expressly excluded, or by the National Labor Relations
Act (if not public employees) under the jurisdiction of the
NLRB. The General Assembly therefore chose to define "public
employee" two ways in R.C. 4117.01(C). In most cases, the
definition is straightforward: a public employee is one who
works for a public employer. However, the legislature did not
stop there in defining "public employee," but continued with
the "including" language. A public employee can also be one
who works for a private employer which has some, but not all,
the attributes of a public employer. When an employer's status
as a public employer is in doubt, the legislature provided that
that employer's employees might still be "public employees"
when the NLRB declined to exercise jurisdiction over them.
If the Society's employees are "public employees" (as they
obviously are), it is glaringly apparent that the Society, as
their employer, must be a "public employer" for R.C. Chapter
4117 purposes. The Society's argument that sometimes employees
may be "public employees," but their employer may at the same
time not be a "public employer" should be unequivocally
rejected. R.C. 4117.01(B) must be read in pari materia with
R.C. 4117.01(C). A "public employer" is, by definition, one
who employs "public employees." And a "public employee" is, by
definition, one who works for a "public employer." When the
definition of either R.C. 4117.01(B) or (C) is fulfilled, the
definition of the other provision is also fulfilled. The
General Assembly's decision to add the open-ended phrase "other
branch of public employment" at the end of R.C. 4117.01(B) is
an indication that in some instances a "public employer" may
not possess all of the attributes of a state body. The
Society, by advocating that we read R.C. 4117.01(B) and (C) as
if they are unrelated, fails to appreciate the legislative
intent that all employees in Ohio fall within the jurisdiction
of either the NLRB or SERB.
R.C. 4117.22 requires that "Chapter 4117. of the Revised
Code shall be construed liberally for the accomplishment of the
purpose of promoting orderly and constructive relationships
between all public employers and their employees." The
majority's narrow interpretation of the definitional provisions
of R.C. 4117.01 cannot be reconciled with the overall purpose
of R.C. Chapter 4117, which is to afford collective bargaining
rights, specified in R.C. 4117.03, to all "public employees."
As this court recognized in Cincinnati Metro. Hous. Auth. v.
State Emp. Relations Bd. (1990), 53 Ohio St.3d 221, 226, 560
N.E.2d 179, 184: "[R.C. Chapter 4117's] overriding purpose is
embodied in the very broad definition of 'public employer,' to
extend the coverage of [R.C. Chapter 4117] as widely as
possible in order to prevent the disruption of important public
services by labor disputes."
The majority states that "[i]n both form and substance the
Society is a private corporation." The majority appears to
rely heavily on the finding that the Society is a private
entity to reach the ultimate conclusion that the Society cannot
be a "public employer." The majority places too much emphasis
on the word "private" and does not thoughtfully consider the
purposes underlying R.C. Chapter 4117, including R.C.
4117.01(C)'s clear provision that sometimes the employees of a
"private employer" can be "public employees." Cincinnati
Metro. Hous. Auth., supra, does not at all stand for the
proposition argued by the Society that only a public body can
be a public employer. Rather, that case is an affirmation that
an expansive, not a limiting, definition should be given to the
term. The Society clearly falls within the definition provided
by the General Assembly. The majority's analysis, which is
based on a very narrow interpretation of "public employer,"
cannot be accepted. The proper approach is diametrically
opposed to that of the majority, who would appear to require
the legislature to enact a statute explicitly declaring the
Society to be a public employer before it would acknowledge
that fact.
Even though the Society argues that it is a private
entity, the Society itself has admitted that it is not private
for all purposes. In State ex rel. Fenley v. Ohio Historical
Soc. (1992), 64 Ohio St.3d 509, 597 N.E.2d 120, the issue
presented involved whether R.C. 149.43 (Ohio's public records
law) obligated the Society to provide copies of public records
by mail. Not at issue in that case was the question whether
the Society is subject to the public records law--the Society
clearly conceded that it is. For an entity to fall within the
public records law, R.C. 149.43(A)(1) provides that the entity
must be a "public office," a term defined in R.C. 149.011(A).
In State ex rel. Toledo Blade Co. v. Univ. of Toledo Found.
(1992), 65 Ohio St.3d 258, 602 N.E.2d 1159, this court
determined that the University of Toledo Foundation, a private
nonprofit corporation, is a public office for R.C. 149.43
purposes, and is subject to the public records law. See, also,
State ex rel. Fostoria Daily Review Co. v. Fostoria Hosp. Assn.
(1988), 40 Ohio St.3d 10, 531 N.E.2d 313 (a private, nonprofit
corporation which performs a public function and is supported
by public tax money is a "public office" within the meaning of
R.C. 149.011[A], and is subject to the public records law).
Even though determining whether an entity is a public office
for R.C. 149.43 purposes differs significantly from determining
whether it is a public employer for R.C. Chapter 4117 purposes,
each inquiry requires a consideration of the distinction
between a public and a private entity. Univ. of Toledo Found.
and Fostoria Hosp. Assn. readily stand for the general
proposition that although an entity may be a private one, it
may still be public for some purposes. If the Society,
allegedly a private entity, can be a public office for R.C.
149.43 purposes (as it has admitted it is), the Society also
conceivably could be a public employer for R.C. Chapter 4117
purposes. As explained above, the Society is unquestionably a
"public employer." The Society's purported status as a private
corporation does not preclude that determination, because R.C.
4117.01(C) specifically provides that, in the proper
circumstances, the employees of a "private employer" are
"public employees." This case clearly presents those proper
circumstances.
In summary, the Society's employees work "pursuant to a
contract between a public employer and a private employer," and
"the national labor relations board has declined jurisdiction
on the basis that the involved employees are employees of a
public employer[.]" R.C. 4117.01(C). Because those two
conditions are met, the Society qualifies as an "other branch
of public employment" within the meaning of R.C. 4117.01(B),
and the Society is a "public employer." I would reverse the
judgment of the court of appeals on this issue.
II
The majority analyzes at length whether the Society
qualifies as "the state or any political subdivision of the
state" for R.C. 4117.01(B) purposes, ultimately determining
that the Society is neither the state nor a political
subdivision of it. Given the foregoing view (expressed in Part
I of this dissenting opinion) that R.C. 4117.01(C) specifically
leads to the conclusion that the Society is a "public
employer," there is no real need to reach this question.
However, the majority's reasoning cannot go unchallenged, and
so I address the issue.
R.C. 4117.01(B)'s definition of "public employer" includes
"*** any state agency, authority, commission, or board, or
other branch of public employment." It is apparent that the
Society is a "state agency" in the sense of this definition.
The Society has numerous attributes of a state agency, which
considered together make it at the very least the de facto
equivalent of a state agency for R.C. Chapter 4117 purposes.
It is incomprehensible how the majority is able to acknowledge
these attributes, and yet find the Society is not a public
employer. As the majority notes, the Society possesses the
following characteristics:
--Pursuant to the Society's constitution, nine members
(one-half) of the Society's board of trustees are appointed by
the Governor.
--The Society enters into contracts with public, as well
as private, entities.
--The Society performs numerous public functions for the
state, as detailed in R.C. 149.30.
--State appropriations provide approximately sixty-five to
seventy percent of the Society's total operating budget.
--Employees of the Society are explicitly authorized to
participate in the Public Employees Retirement System by R.C.
149.30.
--The Society's records are examined annually by the
Auditor of State.
--The Society awards credit for previous state work time
to former state employees it hires.
--State appropriations provided approximately ninety-five
percent of the Society's 1985 funds for capital improvements.
--The Society has a state agency number in the state
budget for identification purposes.
These characteristics, taken in the aggregate, present an
overwhelming scenario. Were several of these factors not
present, this might have been a closer case. However, the
large amount of state funding, taken alone, is a clear indicium
of a public employer. Likewise, when an employer's employees
participate in the Public Employees Retirement System, that
alone also provides a strong indicator that the employer must
be a public employer. The factors the majority relies on to
find that the Society is not a public employer do not come
close to countering the case in favor of finding that the
Society is a public employer. However, as explained in Part I
of this dissenting opinion, there is an even stronger ground
for finding that the Society is a public employer, so that a
resort to consideration of whether the Society possesses
indicia of a public employer should not even be necessary.
A.W. Sweeney and F.E. Sweeney, JJ., concur in the
foregoing dissenting opinion.

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/11147521. Public record. Not legal advice.