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High Court Refuses To Hear Kansas City Tax-Refund Case

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WASHINGTON--The U.S. Supreme Court last week declined to hear an appeal by a group of Kansas City school-district taxpayers that sought refunds of a controversial tax increase ordered by a federal judge in 1987 to pay for the district's desegregation plan.

The High Court in 1990 ruled that U.S. District Judge Russell G. Clark had no unilateral authority to impose the tax increase. But it went on to hold that the judge could order the school district to raise taxes to pay for desegregation remedies.

At issue in the current dispute is whether the taxes paid for 1987 and 1988 pursuant to the judge's order should be refunded.

Judge Clark had ordered the tax increase in 1987 to finance a far-reaching desegregation plan in Kansas City. Some 9,000 residents paid $10.6 million in taxes under protest as set forth in Missouri state law. Other taxpayers paid $23 million in taxes without filing protests.

The Kansas City school district set its 1988 tax rate at the same level as that ordered by the judge for 1987 while it awaited the outcome of various court decisions related to the desegregation plan.

The citizens' group sought the return of $33.6 million for taxes paid in 1987 and $33.4 million for taxes in 1988.

Judge's Ruling

In 1990, Judge Clark ruled that only the 1987 taxes paid under protest should be refunded. Those not paid under protest could not be returned because Missouri law states that once taxes are paid, they can be recovered only if protest procedures have been complied with, the judge held.

Judge Clark refused to refund any of the 1988 taxes, ruling that they were not sufficiently linked to his direct tax order that was ultimately overturned by the Supreme Court in 1990.

Judge Clark's ruling on the refund issue was upheld earlier this year by a panel of the U.S. Court of Appeals for the Eighth Circuit.

In a brief order, the High Court on Oct. 13 declined to review the rulings in Clark v. Jenkins (Case No. 92-69).

The High Court last year refused Missouri's request to review the overall scope and expense of the Kansas City desegregation plan. That plan, and the plan for St. Louis, have become issues in this fall's race for Missouri attorney general because of the state's ongoing burden to share their costs. (See Education Week, Oct. 14, 1992.)

Other Action

In separate actions last week, the High Court:

  • Declined to review lower-court rulings that church-affiliated private schools in Oregon must pay state umemployment taxes. The rulings were challenged by a group of Christian private schools in Bible Temple v. Employment Division (No. 92-348).
  • Heard arguments in Barr v. Flores (No. 91-905), which involves the Immigration and Naturalization Service's policy of detaining juvenile illegal aliens when no relatives are available to take custody of them. A ruling is expected by next July.


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