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Published in Print: August 5, 1998, as Ariz. High Court OKs Plan To End Facilities Lawsuit

Ariz. High Court OKs Plan To End Facilities Lawsuit

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Arizona's high court has put its stamp of approval on the state's plan for creating a more equitable system of financing school construction. The ruling last month capped years of legislative wrangling.

The supreme court declared the finance case closed on July 20, about a month before the legislature's deadline to come up with a plan that met legal muster or face a cutoff of state school aid. Many schools resume classes this month.

The court approval came seven years after a coalition of poor districts filed a lawsuit against the state, arguing that Arizona's system of paying for school facilities violated the state constitution's call for a "general and uniform" public school system.

In 1994, the high court agreed. Since then, the legislature has made several attempts to change the system, but the courts until now have shot them down. ("Ariz. High Court Again Rules Finance Plan Unconstitutional," June 24, 1998.)

So state leaders were relieved last month to hear a different message from the bench.

"This is one of the most important issues Arizona has faced since statehood," Gov. Jane Dee Hull, a Republican, said last month in a prepared statement. "Now every student will have the same chance for a great education in a great school."

Gov. Jane Dee Hull

At the close of a two-day special legislative session, lawmakers on July 8 passed a finance plan that shifts much of the fiscal responsibility for building and maintaining schools from local districts to the state.

The next day, Gov. Hull signed the Students FIRST plan--Fair and Immediate Resources for Students Today--into law. Ms. Hull, a former teacher, had called lawmakers back to the capital after the court in June rejected a plan that was the product of a grueling 29-day spring special session.

Limiting Bonding

The court had taken issue with an opt-out provision that enabled only those school systems that met the state's minimum-adequacy facility standards to continue using voter-approved bonds to build schools.

The new law allows all districts to issue bonds if they want to go above and beyond the state's facility standards.

In an attempt to rein in disparities between districts, the new system limits how much bond debt they can carry.

"But if we do a good job in getting good state standards, there shouldn't be the need for districts to do much beyond that," said Timothy M. Hogan, the director of the Phoenix-based Center for Law in the Public Interest, which filed the original lawsuit.

The state estimates that its plan will cost $374 million a year initially, eventually costing less as existing maintenance problems are resolved.

The plan is designed to send state aid to districts so they can meet the adequacy standards for facilities.

The state dollars will help fix existing deficiencies, renovate older buildings and build new ones, and buy "soft capital" items such as textbooks, technology, and classroom equipment.

The state does not intend to raise taxes to pay for the plan. State leaders say that the coffers are flush from a booming economy and that, in the event of an economic downturn, the state can issue revenue bonds to raise money.

State Standards Key

While educators welcomed last month's ruling by the Arizona Supreme Court, many say the hard work is just beginning.

The governor must appoint a new, nine-member panel to review facility needs in the state's 228 districts and, eventually, review petitions for building new schools. By April 30 of next year, the board must set the minimum-adequacy standards the state has pledged to enable all schools to meet.

What those standards look like is key. If they are not strong enough, Mr. Hogan said, the state could wind up back in court.

Mr. Hogan has asked the court to reconsider its move to close the case, arguing that it should remain open until the state writes the adequacy standards.

Fears linger about where Arizona leaders will get the money--and the political will--to fully support the needs of the fast-growing state. Critics envision a new state bureaucracy overwhelmed by a backlog of district facility-aid requests. And there is widespread concern that the basic state aid that pays for day-to-day school operations will lose out in future budget battles.

When funding is adjusted to reflect regional differences in the cost of education, Arizona in fiscal 1997 spent an average of $4,951 per student, among the lowest amounts in the nation.

Penny Kotterman, the president of Arizona's affiliate of the National Education Association, said the state's work on school facilities is critical. "But," she added, "let's not forget what's inside those buildings: kids, teachers. And all that comes out of the maintenance and operation budget, not capital.

"We don't want to rob the rest of the general fund to pay for a very expensive building program."

Vol. 17, Issue 43, Pages 21,28

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