There is currently a case going to court in California about the legality of the California Institute of Regenerative Medicine.This agency was created by Proposition 71, a voter initiative to allocate 3 billion in public funds towards controversial stem cell research. A little more on Prop 71:

Proposition 71 authorized the agency to dole out an average of $300 million in research grants each year over 10 years, but 15 months later the agency has yet to hand out a dime because of its legal troubles. The lawsuits have scared off lenders, who won't buy the institute's bonds until the litigation is resolved.

The resolution passed with a 59% vote and was designed to get state funds towards embryonic stem cell research in light of the Bush Administration's withholding of federal dollars toward embryonic research. It should be interesting to see the outcome of this case, though I am assuming that Prop 71 will hold as law. The essence of the challenge from two private groups is as follows:

"The act delegates the disbursal of huge sums of public money to the unfettered discretion of an institution whose governing board and working groups are unaccountable to the public,"

For those interested in the development of embryonic stem cell funding in America, this is a case to watch as several other state governments have considered similar efforts.

AP Story: Calif. Stem Cell Agency Fights for Life - Yahoo! News