1. Copyright © Allyn & Bacon 2008 Chapter 13 Finance This multimedia product and its contents are protected under copyright law. The following are prohibited by law: any public performance or display, including transmission of any image over a network; preparation of any derivative work, including the extraction, in whole or in part, of any images; any rental, lease, or lending of the program. This multimedia product and its contents are protected under copyright law. The following are prohibited by law: any public performance or display, including transmission of any image over a network; preparation of any derivative work, including the extraction, in whole or in part, of any images; any rental, lease, or lending of the program.

2. Copyright © Allyn & Bacon 2008 The U.S. Constitution imposes no legal obligation on the Federal Government to operate a public education system. The U.S. Constitution imposes no legal obligation on the Federal Government to operate a public education system. State legislatures are generally authorized to provide for a public education system. State legislatures are generally authorized to provide for a public education system.

3. Copyright © Allyn & Bacon 2008 They may also levy taxes and develop a systematic method of distributing school funds. They may also levy taxes and develop a systematic method of distributing school funds. School districts are agents of the state but do not possess broad powers to levy taxes and are subject only to the powers delegated to them by the legislature. School districts are agents of the state but do not possess broad powers to levy taxes and are subject only to the powers delegated to them by the legislature.

4. Copyright © Allyn & Bacon 2008 The legislature does have discretionary power to delegate taxing authority to local school districts if it chooses to do so as long as state constitutional tax limitations are met. The legislature does have discretionary power to delegate taxing authority to local school districts if it chooses to do so as long as state constitutional tax limitations are met. Taxing authority cannot be delegated to subordinate bodies unless there are clear limitations or restrictions placed on the delegated powers. Taxing authority cannot be delegated to subordinate bodies unless there are clear limitations or restrictions placed on the delegated powers.

5. Copyright © Allyn & Bacon 2008 Legal Challenges to School Funding School finance programs have been challenged under both federal and state constitutions. School finance programs have been challenged under both federal and state constitutions. Most challenges have focused on issues regarding equity of finance programs with respect to tax burdens. Most challenges have focused on issues regarding equity of finance programs with respect to tax burdens.

6. Copyright © Allyn & Bacon 2008 Other challenges involve assertions that parents and their children are denied the benefits of an equal educational opportunity based on disparities in tax revenue and distribution of revenue among school districts within a state. Other challenges involve assertions that parents and their children are denied the benefits of an equal educational opportunity based on disparities in tax revenue and distribution of revenue among school districts within a state.

7. Copyright © Allyn & Bacon 2008 San Antonio Independent School District v. Rodriquez Legal challenges were pursued at both the state and federal level challenging funding programs throughout the country using the fiscal neutrality standard embraced in Serrano to address disparity in wealth among school districts. Legal challenges were pursued at both the state and federal level challenging funding programs throughout the country using the fiscal neutrality standard embraced in Serrano to address disparity in wealth among school districts.

8. Copyright © Allyn & Bacon 2008 One such case in Texas reached the U.S. Supreme Court. In a 5-4 decision, the Supreme Court reversed a lower court’s ruling that the Texas finance system was unconstitutional. One such case in Texas reached the U.S. Supreme Court. In a 5-4 decision, the Supreme Court reversed a lower court’s ruling that the Texas finance system was unconstitutional.

9. Copyright © Allyn & Bacon 2008 The court did note the discrepancies created by the funding system where great disparities existed regarding ad valorem taxes from one district to another. The court did note the discrepancies created by the funding system where great disparities existed regarding ad valorem taxes from one district to another.

10. Copyright © Allyn & Bacon 2008 In spite of these discrepancies, the court concluded that the Texas funding system did not work to the disadvantage of any class or group since the disadvantages occurred only between districts regardless of the relative wealth of any family within the district. In spite of these discrepancies, the court concluded that the Texas funding system did not work to the disadvantage of any class or group since the disadvantages occurred only between districts regardless of the relative wealth of any family within the district.

11. Copyright © Allyn & Bacon 2008 The Rodriquez ruling essentially removed future finance cases from reaching the highest court in the land. The Rodriquez ruling essentially removed future finance cases from reaching the highest court in the land. The U.S. Supreme Court’s decision effectively placed legal challenges regarding school funding programs in the state courts since education is a function of the states. The U.S. Supreme Court’s decision effectively placed legal challenges regarding school funding programs in the state courts since education is a function of the states.

12. Copyright © Allyn & Bacon 2008 The compelling aspect of the Rodriquez ruling was that Texas case did not interfere with a “fundamental” right since education, while undeniably of high importance, is not recognized by the High Court as being among those guaranteed by the Constitution. The compelling aspect of the Rodriquez ruling was that Texas case did not interfere with a “fundamental” right since education, while undeniably of high importance, is not recognized by the High Court as being among those guaranteed by the Constitution.