1. Chapter 5 in Guthrie Dr. Len Elovitz Judicial Review of State Financing Plans

2. 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 CLASSIFICATION CREATED BY THE LAW ARE NOT ARBITRARY OR IRRATIONAL 2. STATE CONSTITUTIONAL CLAUSES A. UNIFORM B. ADEQUATE C. THOROUGH AND/OR EFFICIENT

3. 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 CHILDS EDUCATIONAL NEEDS?

4. SERRANO V PRIEST 1. 1967 – LOS ANGELES AREA SCHOOL DISTRICT 2.CASE BEFORE CALIFORNIA SUPREME COURT 3.TESTIMONY - 1968-69 4. CASE WASNT DECIDED UNTIL 1971

5. Serrano Facts A. J. SERRANO COMPLAINED TO THE PRINCIPAL ABOUT THE QUALITY OF SERVICES OFFERED AT SONS 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

6. COMPLAINT FUNDING SCHEME WHICH MAKES THE QUALITY OF A CHILDS 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 14 TH AMENDMENT AND PARALLEL CLAUSE IN THE CA CONSTITUTION.

7. BEVERLY HILLSBALDWIN 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

8. 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

9. 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 14 TH 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

10. EDGEWOODALAMO HEIGHTS STUDENTS22,0005,000 SCHOOLS256 MINORITY96%19% MEDIAN INCOME$4,6868,001 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

11. COURT HELD A. 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

12. 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

13. THE SUPREME COURT ON APPEAL A. 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 COMMUNITYS 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

14. NJ AT THE TIME A. 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

15. 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.

16. 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

17. 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

18. 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 TO A. EQUALIZE TAX BURDEN B. DISTRIBUTE STATE AID MORE EQUITABLY HOWEVER, REVISIONS ACTUALLY LOWERED THE FOUNDATION LEVEL AND DIVERTED FUNDS TO PROPERTY TAX RELIEF

19. ABBOTT II – 1990 NJSC HELD QEA TO BE UNCONSTITUTIONAL ONLY AS IT EFFECTED THE SPECIAL NEEDS DISTRICTS QEA DIDNT WORK BECAUSE BASING AID ON PREVIOUS YEARS 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

20. 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

21. 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).

22. 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 States wealthiest districts.

23. Abbott V - 1998 The Court held that Abbott districts could also seek supplemental funding over parity to support particularized needs.

24. 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.

25. SCHOOL FUNDING REFORM ACT (SFRA) - 2008 Introduced in December 2007 Current NJ Funding Formula

26. 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

27. 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

28. 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