Published Online: June 7, 2010
Published in Print: June 9, 2010, as Lawsuit Seeks to Overhaul Calif. School Finance System

Suit Would Overhaul Calif. School Finance System

In what could become the most important school finance litigation in 40 years in California, parents, students, school leaders, and education advocates are suing the state to force it to overhaul the way it pays for public schooling.

The plaintiffs—including nine school districts and 60 students and their families—sued late last month, claiming that California’s system for financing K-12 public education violates the state constitution.

They argue that although the state prescribes what teachers must teach and what students must learn, it does not provide the resources to deliver on those requirements. They are asking the courts to order the governor and the state legislature to scrap the current finance system and design a new one that is “sound, stable, and sufficient.”

“This lawsuit is the last resort,” said Frank Pugh, the president of the California School Boards Association, one of the plaintiffs. “The governor and the legislature, and I mean both sides of the aisle, have known for some time that the current school finance system is harming students, and yet they’ve done nothing to remedy the crisis.”

Bonnie Reiss, California’s education secretary, said that her boss, Republican Gov. Arnold Schwarzenegger, is willing to work with the courts and the plaintiffs on reviewing the state’s finance system for schools, but with some important conditions.

“Just looking at the finance system is not going to achieve the results that the lawsuit says it wants to achieve in terms of student achievement if all we do is change the finance system and add more funding,” Ms. Reiss said in an interview last week. “First, we have to look at our entire education system and the distribution of money and make sure we have a system that maximizes getting dollars to the classroom of every student, especially in the form of a highly effective teacher.”

The suit was filed May 20 in Alameda County Superior Court.

California, with K-12 enrollment of 6 million public students, ranks near the bottom of the 50 states for its per-pupil funding, according to the Editorial Projects in Education Research Center, which determined that the state spent $8,164 per pupil in 2007, more than $2,000 less than the national average of $10,557.

A spokesman for Attorney General Jerry Brown’s office, which will represent the state in the lawsuit, did not comment other than to say that lawyers were reviewing the complaint.

Over the past two years, California’s budget woes have forced lawmakers in the Democratic-controlled legislature and Gov. Schwarzenegger to make deep spending cuts to many of the state’s core services, including K-12 education. The cuts to public schools have added up to roughly $17 billion over those two years, and more could be in the offing as lawmakers and the governor wrestle with closing a $20 billion gap in the budget proposed for fiscal 2011. State spending on K-12 in fiscal 2010 still accounted for about 37 percent of California’s $91.4 billion overall budget.

But the plaintiffs, which include the districts in San Francisco and Santa Ana, say the school finance system—with funding formulas that date back as far as 60 years—has been dysfunctional for years. Their lawsuit, which could take years to play out, is not directed at the upcoming legislative budget negotiations, said Abe Hajela, a Sacramento lawyer for the plaintiffs.

“This was a systemic problem before we had the budget crisis, and it will probably be there after the crisis is resolved,” he said.

Mr. Hajela, who is representing the CSBA,as well as the California State PTA and the Association of California School Administrators, said the case is unlike other school finance lawsuits that have focused purely on equity or adequacy issues, including the 1976 Serrano v. Priest case in California that determined that property-tax rates and per-pupil expenditures had be to equalized across all of the state’s school districts. The Serrano case was appealed to the California Supreme Court by the defendants, but the case was closed in 1987 after the plaintiffs withdrew.

The essence of the new case, Mr. Hajela said, is that the state’s politicians have consistently fallen short of delivering on the state constitution’s guarantee that education funding be a priority.

“This case is different because the state is exercising its constitutional authority when it comes to having developed an educational program for the state where it’s clear what schools must teach and what students must learn,” Mr. Hajela said. “But the state isn’t living up to its duty to provide the resources to actually deliver on that. This is a systemic attack on school finance. We’re not trying to fix a discrete problem in one district, but an entire system.”

A second, related lawsuit could also be in the works. The Campaign for Quality Education, a coalition of several organizations that advocate for poor and minority children, sent a letter to Gov. Schwarzenegger last month that lays out similar complaints about the state’s finance system for schools. That letter was sent by lawyers who handled the Williams v. California case, an adequacy suit settled in 2004 by Gov. Schwarzenegger that led to improvements in basic learning conditions in schools across California.

Vol. 29, Issue 33, Page 24

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