Colorado Supreme Court Upholds School-Finance Statute

By Alex Heard — June 02, 1982 5 min read
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The Colorado Supreme Court, by a 4-to-2 majority, last week upheld the state’s system of financing education, reversing a 1979 district-court ruling that the system violates both the federal and state constitutions.

But one concurring judge wrote that the “bare majority” decision “should not be interpreted as an approval” of the plan, which “barely meet[s] constitutional standards.”

The majority opinion also states that “this decision should not be read to indicate that we find [the system] to be without fault.”

Chief Justice Paul V. Hodges wrote the opinion for the majority, in which he stated that Colorado’s 1973 Public School Finance Act does not--as the lower-court judge, Joseph R. Quinn, had said--violate either the equal-protection guarantees of the federal and state constitutions or a section in the Colorado constitution calling for “a thorough and uniform system of free public schools.”

‘Thorough and Uniform System’

Regarding the meaning of “thorough and uniform system,” Justice Hodges wrote:"A heartfelt recognition and endorsement of an education does not elevate a public education to a fundamental interest warranting strict scrutiny.

“The constitutional mandate which requires the General Assembly to establish a ‘thorough and uniform system of free public schools’ is not a mandate for absolute equality in educational services or expenditures,” he added.

The opinion further stated: “The Colorado Constitution does not forbid disparities in wealth, nor does it forbid persons residing in one district from taxing themselves at a rate higher than persons in another district.”

In some other states, including New Jersey, Maryland, and, most recently, West Virginia, similar constitutional provisions have been construed by state courts as guarantees of financial parity, or at least of comparable expenditures per pupil. But because the U.S. Supreme Court ruled in 1973, in San Antonio Independent School District v. Rodriguez, that education is not a fundamental right under the U.S. Constitution, there is no nationwide standard for judging the fairness of states’ school-finance schemes.

The Colorado decision closely resembles one handed down last winter by the Georgia Supreme Court, which held that that state’s school-finance system was inequitable but not unconstitutional.

The Colorado Supreme Court also said that the school-finance system furthers a “legitimate state purpose” (the lower court said it did not), in this case, local control of schools.

The lower court had argued, in finding the school-finance system in violation of equal-protection provisions, that the system did interfere with what it called the “fundamental right” to education by allowing students in “high-wealth, high-spending” school districts greater educational opportunities than students in “low-wealth” districts.

But the state supreme court reiterated that in its opinion education is not a fundamental right under either the federal or state constitutions.

In a dissenting opinion, Justice George E. Lohr argued that a broader interpretation should be given to the “thorough and uniform” clause than appeared in the majority opinion. “Uniformity requires parity of educational opportunity, not, as the majority indicates, simply an assurance that some bare minimum opportunity is available in each school district,” he wrote.

Edwin Steinbrecher, Colorado’s assistant state commissioner of education, said he was surprised that decision found the “to-tal” finance system constitutional. “We thought the court might parcel it into several different issues,” he said.

The decision is a clear signal from the court, he added, that the legislature should continue its efforts to improve the system.

L. Richard Freese Jr., a lawyer for the plaintiffs, said no decision has been reached on whether to appeal the ruling.

A spokesman for the Chicano Education Project, a non-profit educational organization that sponsored the suit, said her group was “shocked and totally stunned” by the decision.

During a press conference following the decision, according to the spokesman, the plaintiffs said that a system that is so glar-ingly unequal, even if not unconstitutional, requires reform.

Federal and State Violations

The case, Lujan v. Colorado State Board of Education--first tried before the district court in Denver in 1978--was brought by 69 schoolchildren from 16 Colorado school districts, who claimed that the state’s school-finance law violated both the federal and state constitutions.

The plaintiffs said the state’s finance system left poorer districts at a distinct educational disadvantage.

Funding for school districts in the state comes primarily from a combination of local taxes (about 47 percent) and state support (about 43 percent).

The amount of local funding varies considerably with the valuation of taxable property within a district.

The state finance system comprises four major features: the authorized revenue base, state equalization aid, minimum-guarantee money, and a capital-reserve and bond-redemption fund.

The authorized revenue base--the maximum annual amount a district may spend in general operating expenses per pupil--is a specified dollar amount established annually for each district.

A district may increase its authorized revenue base in one of two ways: by requesting an increase from the state budget-review board for school districts, or by holding a local election. If an increase is approved, the district must raise its local tax levy to fund the increase in the authorized revenue base for the first year.

State equalization aid provides support for districts with limited tax bases and revenue-raising capacity. The program grants districts equalization aid amounting to the difference between the funds raised from local taxes and the amount of the legislated guarantee (paid on a per-pupil basis per tax mill levied).

“Minimum-guarantee” money is a flat grant given on a per-pupil-per-mill basis to districts, regardless of their tax base.

The capital-reserve and bond-redemption funds help school districts finance capital construction projects.

The district court found that this system allowed districts with high property values to raise more revenue for education than poorer school districts.

In 1977, for example, some districts had authorized revenue bases three times as large as others, and the plaintiffs’ districts had an average authorized revenue base $300 lower than the state average.

The district court said state equalization aid is incapable of making the revenue-raising potential of “low-wealth” districts equal that of “high-wealth” districts.

The court also said that requiring a district to pay for the first-year increase in its authorized revenue base is a difficult, if not impossible, demand for “low-wealth” districts to meet.

The court noted, for example, that to finance a $100-per-pupil increase in the authorized revenue base in one affluent Colorado district would take only a 0.3-mill tax increase, but the same increase in a poorer county would require a 17-mill tax increase.

A version of this article appeared in the June 02, 1982 edition of Education Week as Colorado Supreme Court Upholds School-Finance Statute


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