Chapter 5 in Guthrie

Dr. Len Elovitz

Judicial Review of State Financing Plans

STANDARDS FOR JUDICIAL REVIEW OF STATE FUNDING

1. EQUAL PROTECTION 

A. PEOPLE IN SIMILAR SITUATIONS MUST BE TREATED

EQUALLY 

B. PEOPLE MAY ONLY BE TREATED DIFFERENTLY IF THE CLASSIFICATIONS CREATED BY THE LAW ARE NOT ARBITRARY OR IRRATIONAL 2. STATE CONSTITUTIONAL CLAUSES

A. UNIFORMB. ADEQUATEC. THOROUGH AND/OR EFFICIENT

 

MCINNIS V OGILVIE (SHAPIRO)

1. 1969 – US DISTRICT COURT ILLINOIS 2. COMPLAINT - THAT THE SCHOOL REVENUES

BE ALLOCATED IN PROPORTION TO STUDENT NEEDS. CURRENT SYSTEM IN ILL. VIOLATED EQUAL PROTECTION

 3. DENIED – COURT RULED THAT NO

STANDARDS COULD BE DEVELOPED THAT WOULD MAKE A DECISION JUDICIALLY MANAGEABLE. HOW CAN YOU CONSTRUCT AN OBJECTIVE MEASURE OF A CHILD’S EDUCATIONAL NEEDS?

SERRANO V PRIEST

1. 1967 – LOS ANGELES AREA SCHOOL DISTRICT

 2.CASE BEFORE CALIFORNIA SUPREME

COURT

3.TESTIMONY - 1968-69 4. CASE WASN’T DECIDED UNTIL 1971

Serrano FactsA. J. SERRANO COMPLAINED TO THE PRINCIPAL

ABOUT THE QUALITY OF SERVICES OFFERED AT SON’S SCHOOL

 B. PRINCIPAL ADVISED THAT DISTRICT COULD

NOT AFFORD BETTER SERVICES AND COUNSELED A MOVE TO A WEALTHIER DISTRICT

 C. COULD NOT AFFORD A MOVE AND BROUGHT

SUIT D. SINCE ONE CAN ONLY SUE THE LEGISLATURE

WITH ITS PERMISSION, SUIT WAS BROUGHT AGAINST IVY BAKER PRIEST, THE CA TREASURER

COMPLAINT

FUNDING SCHEME WHICH MAKES THE QUALITY OF A CHILD’S EDUCATION DEPENDENT UPON THE WEALTH OF HIS PARENTS AND NEIGHBORS INVIDIOUSLY DISCRIMINATES AGAINST THE POOR IS IN CONTRAVENTION OF THE EQUAL PROTECTION CLAUSE OF THE 14TH AMENDMENT AND PARALLEL CLAUSE IN THE CA CONSTITUTION.

BEVERLY HILLS BALDWIN PARK

PROPERTY WEALTH $50,000/PUPIL $3,706/PUPIL

EXPENDITURE $1,232/PUPIL $577/PUPIL

TAX RATE $2.38 $5.48

STATE AID $125 $307

DECISION

A. FAVORED SERRANO B. “AFFLUENT DISTRICTS CAN HAVE THEIR CAKE AND

EAT IT TOO; THEY CAN PROVIDE A HIGH QUALITY EDUCATION FOR THEIR CHILDREN WHILE PAYING LOWER TAXES. POOR DISTRICTS, BY CONTRAST HAVE NO CAKE AT ALL.”

 C. COURT RULED THAT SCHOOL SPENDING IN EXCESS

OF $100/PUPIL COULD NOT BE WEALTH RELATED. D. CALIFORNIA BEGAN TO REDUCE DISPARITIES UNTIL

THEY WERE DEEMED INSIGNIFICANT BY THE COURT  E. PROPOSITION 13 - CALIFORNIA TODAY

RODRIGUEZ V SAN ANTONIO

1. 1973 2. SUIT BROUGHT BY PARENTS WHOSE

CHILDREN ATTENDED SCHOOLS IN SAN ANTONIO

 3. COMPLAINT – THE TEXAS SYSTEM OF SCHOOL

FINANCE WAS UNCONSTITUTIONAL UNDER THE EQUAL PROTECTION CLAUSE OF THE 14TH AMENDMENT

 4. DECISION IN FAVOR OF THE PLAINTIFF BY

DISTRICT COURT IN 1971 WAS REVERSED BY THE US SUPREME COURT IN 1973 IN A 5-4 DECISION

EDGEWOOD ALAMO HEIGHTS

STUDENTS 22,000 5,000

SCHOOLS 25 6

MINORITY 96% 19%

MEDIAN INCOME $4,686 $8,001

PROPERTY WEALTH $5,960/PUPIL $49,000/PUPIL

STATE AID $222/PUPIL $225/PUPIL

DISTRICT CONTRIBUTION

$26/ CHILD $333/CHILD

FEDERAL AID $108/PUPIL $36/PUPIL

EXPENDITURE $356/PUPIL $594/PUPIL

TAX RATE $1.05 $0.85

COURT HELDA. ABSENT A SPECIFIC CONSTITUTIONAL REFERENCE,

EDUCATION WAS NOT A FUNDAMENTAL RIGHT B. THE STATE WAS NOT OBLIGATED TO DEMONSTRATE A

COMPELLING INTEREST TO JUSTIFY FISCAL DISPARITIES  C. AS LONG AS THE STATE HAD A REASONABLE

JUSTIFICATION FOR ITS SYSTEM OF FUNDING, IT WAS NOT ILLEGAL

 D. ACKNOWLEDGED THAT IT MIGHT BE UNJUST E. STUDENTS OF PROPERTY POOR DISTRICTS WERE NOT

HOMOGENEOUS ENOUGH TO COMPRISE A SUSPECT CLASSIFICATION –

 F. WAS NOT PERSUADED THAT EXPENDITURE DISPARITIES

RESULTED IN DAMAGE TO STUDENTS 

ROBINSON V CAHILL - 1970• SUIT BROUGHT IN SUPERIOR COURT BY A NUMBER OF

PEOPLE FROM SEVERAL MUNICIPALITIES CHALLENGING THE CONSTITUTIONALITY OF THE NJ SYSTEM OF SCHOOL FINANCE

 • PLAINTIFFS CHARGED THAT THE SYSTEM WAS

UNCONSTITUTIONAL BECAUSE IT RELIED TOO HEAVILY ON LOCAL PROPERTY TAXES AND RESULTED IN GREAT DISPARITY IN THE QUALITY OF EDUCATION OFFERED

 • PLAINTIFFS ARGUED THAT THE METHOD OF FINANCE

VIOLATED THE STATE CONSTITUTION DIRECTED THAT: 

▫ “THE LEGISLATURE SHALL PROVIDE FOR THE MAINTENANCE OF A THOROUGH AND EFFICIENT SYSTEM OF FREE PUBLIC SCHOOLS FOR THE INSTRUCTION OF ALL CHILDREN IN THE STATE BETWEEN THE AGES OF FIVE AND EIGHTEEN YEARS”

THE SUPREME COURT ON APPEALA. INTERPRETED THE T&E CLAUSE AS A MANDATE THAT THE STATE MUST

PROVIDE AN EQUAL EDUCATIONAL OPPORTUNITY FOR ALL CHILDREN B. HELD THAT THE CURRENT METHOD OF FINANCE WAS NOT GEARED TO

MEET THAT MANDATE C. AGREED THAT THE HEAVY RELIANCE ON LOCAL PROPERTY TAXES

PRODUCED A DIRECT RELATIONSHIP BETWEEN A COMMUNITY’S WEALTH AND THE AMOUNT OF FUNDS AVAILABLE FOR PUBLIC EDUCATION

 D. ACCEPTED THE VIEW THAT THE QUALITY OF EDUCATIONAL OPPORTUNITY

DEPENDS SUBSTANTIALLY UPON THE NUMBER OF DOLLARS EXPENDED E. NOTED THAT THE STATE NEVER DEFINED T&E F. DID NOT STRIKE DOWN THE USE OF LOCAL PROPERTY TAXES IN THE

FORMULA

NJ AT THE TIMEA. STATE = 28% B. LOCAL = 67% C. FEDERAL AND MISC. = 5% D. CONTAINED – MINIMUM AID, SAVE HARMLESS & FOUNDATION E. RESULTED IN VAST DISPARITIES OF AMOUNT EXPENDED F. DID NOT GUARANTEE THAT THE COMBINATION OF

LOCAL EFFORT AND STATE AID WOULD YIELD A THOROUGH AND EFFICIENT EDUCATION

THE LEGISLATURES RESPONSE – THE PUBLIC SCHOOL EDUCATION ACT OF 1975 (T&E LAW)

A. DEFINED IN GENERAL TERMS WHAT CONSTITUTES A T&E SYSTEM OF PUBLIC EDUCATION

 B. ESTABLISHED GUIDELINES AND

MONITORING PROCEDURES TO INSURE PROGRESS TOWARD T&E EDUCATIONAL GOALS

 C. ESTABLISHED A FUNDING STRUCTURE

TO INSURE ADEQUATE FINANCIAL RESOURCES TO IMPLEMENT A T&E SYSTEM OF PUBLIC SCHOOLS.

• JANUARY 1976 SUPREME COURT HELD THE ACT TO BE CONSTITUTIONAL AND THAT IT MET THE MANDATE ASSUMING FULL FUNDING

 • LEGISLATURE COULD NOT AGREE ON A

METHOD OF FUNDING 

• IN MAY, 1976 SUPREME COURT ENJOINED THE EXPENDITURE OF FUNDS FOR EDUCATIONAL PURPOSES EFFECTIVE JULY 1, 1976

• TWO DAYS LATER THE STATE LEGISLATURE APPROVED A TAX PACKAGE THAT INCLUDED THE GROSS INCOME TAX

 • THE SUPREME COURT DISSOLVED THE

INJUNCTION

ABBOTT V BURKE I - 1984

• COURT FOUND THAT THE T&E LEGISLATION ACTUALLY WIDENED DISPARITIES IN SPENDING

 • RESPONSE WAS THE QUALITY EDUCATION ACT

OF 1990 WHICH SOUGHT TOA. EQUALIZE TAX BURDENB. DISTRIBUTE STATE AID MORE

EQUITABLY

• HOWEVER, REVISIONS ACTUALLY LOWERED THE FOUNDATION LEVEL AND DIVERTED FUNDS TO PROPERTY TAX RELIEF

ABBOTT II – 1990• NJSC HELD QEA TO BE UNCONSTITUTIONAL ONLY AS

IT EFFECTED THE SPECIAL NEEDS DISTRICTS

• QEA DIDN’T WORK BECAUSE▫ BASING AID ON PREVIOUS YEAR’S BUDGET

PERPETUATED PAST INEQUITIES ▫ RESTRICTING ANNUAL INCREASES BY A SPECIFIED

PERCENTAGE INHIBITS THE LEVELING UP OF LOWER SPENDING DISTRICTS– DISCUSS BUDGET CAPS

• C. PAYING CATEGORICAL AID REGARDLESS OF WEALTH WORKED AGAINST THE PROVISION THAT CUT OFF EQUALIZATION AID TO HIGH SPENDING DISTRICTS

• COURT ORDERED EXPENDITURES TO BE BROUGHT UP TO THE LEVEL OF I &J DISTRICTS – DISCUSS DFG

 • 4. FURTHER TO PROVIDE ADDITIONAL FUNDING

THAT IS “ADEQUATE TO PROVIDE FOR THE SPECIAL EDUCATIONAL NEEDS OF THESE POORER URBAN DISTRICTS IN ORDER TO REDRESS THEIR EXTREME DISADVANTAGES”

• 5. RESULT OF FURTHER ABBOTT LITIGATION WAS CEIFA

 

Abbott IV - 1997• The NJ State Supreme Court found that the funding

provisions of CEIFA were unconstitutional as applied to the Abbott districts (also referred to as special needs districts or SNDs).

• Although the CEIFA formula included provisions for districts and schools with high concentrations of poverty, the Supreme Court stated: “The amount of aid provided for those programs… is not based on any actual study of the needs of the students in the SNDs or the costs of supplying the necessary programs” (Abbott IV at 180).

• In the absence of documentation demonstrating that the CEIFA model provided sufficient resources to educate students in districts with high concentrations of poverty, the Court required an interim remedy: Abbott districts would receive “parity aid,” or an amount equal to the average regular education per pupil expenditures in the State’s wealthiest districts.

Abbott V - 1998

• The Court held that Abbott districts could also seek supplemental funding over parity to support particularized needs.

• The CEIFA formula was calculated from fiscal year 1998 through fiscal year 2002. Since that year, the formula has not been run and State aid has been distributed based on district demographics and other characteristics existing in FY 2002. During that time period, litigation over various aspects of funding for the Abbott districts continued, and in May 2006, the Department informed the Court that the creation of a new funding formula was a Departmental priority and that it was committed to develop a funding formula that would meet the needs of all students and would address the inequities that had resulted from the imbalance of increased funding targeted primarily to Abbott districts.

SCHOOL FUNDING REFORM ACT (SFRA) - 2008•Introduced in December 2007

•Current NJ Funding Formula

HOBSON V HANSEN -1967, 1969Washington,D.C.

• JULIUS HOBSON – SCHOOL BOARD MEMBER SUED BECAUSE SCHOOLS IN THE SAME DISTRICT WITH PREDOMINATELY WHITE POPULATIONS APPEARED TO HAVE A DISPROPORTIONATE NUMBER OF HIGH-PAID TEACHERS AND SUPPLIES.

• SCHOOL DISTRICT CLAIMED▫ NO POLICY TO ACCOUNT FOR THE DISCRIMINATION _ DE

FACTO▫ CAUSED BY SENIORITY TRANSFER RULES WHICH

PERMITTED SENIOR STAFF TO WORK WHERE THEY WANTED

•JUDGE SAID TOO BAD – REDISTRIBUTE •DISTRICT ATTEMPTED TO COMPLY BUT

ENCOUNTERED “EXTRAORDINARY TECHNICAL DIFFICULTIES”

 • HOBSON SUED AGAIN IN 1971 – JUDGE

WROTE AN EVEN STRONGER OPINION

• AN EVALUATION OF SEVERAL LARGE DISTRICTS TURNED UP SUBSTANTIAL INTRADISTRICT RESOURCE DISPARITY

•   THE US OFFICE OF EDUCATION ISSUED “COMPARABILITY” REGULATIONS

• DEMANDED THAT DISTRICTS DISTRIBUTE RESOURCES EQUITABLY TO REMAIN ELIGIBLE FOR FEDERAL FUNDS

• B. MINIMAL SERVICES MUST BE DISTRIBUTED EQUALLY

• C. ADDED RESOURCES FAVORING ONE GROUP MUST BE EDUCATIONALLY JUSTIFIABLE