'Serrano' Case May Be Nearing Climax

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The California Supreme Court has agreed to decide whether the state has done enough to reduce financial inequalities between poor and affluent school districts, as the court ordered it to do 10 years ago.

Four justices-the minimum number needed to grant review voted to hear the plaintiffs' appeal in the so-called "Serrano III" case, an outgrowth of the court's 1974 decision in the landmark case of Serrano v. Priest.

The high court will determine whether a lower-court judge erred when he ruled in 1983 that the state did not need to take further steps to equalize school spending.

Oral arguments in the case are expected early next year, according to a spokesman for the California Department of Education.

In the 1974 ruling, the supreme court held that by forcing school districts to rely heavily on local proper- I ty taxes, the state's education-finance system created sharp inequalities. Two years later, in "Serrano II," the court ordered the state to reduce substantially by 1980 the gap between low- and high-spending districts.

Under the order, the state was required to ensure that per-student spending did not vary more than $100 among districts.

The court's order triggered a major increase in state funding for schools, which accelerated in the wake of California's Proposition 13, which capped local property taxes. The state now pays just less than 71 percent of all education costs, excluding federal dollars, according to statistics from the state department of education.

Shortly after the 1980 deadline expired, the Serrano plaintiffs returned to court, arguing that the state had not met the $100 target. So far, a superior court judge and the state court of appeals have rejected their arguments. The supreme court voted in July to hear the plaintiffs appeal.

Statistics show that 94 percent of I the state's students are now enrolled in districts meeting the $100 limit, and the state has argued that any further equalization would do little good for poor districts while imposing severe hardships on higher-spending ones.

The state is also arguing that the $100 limit is outdated and should be doubled to reflect inflation.

But the plaintiffs contend that under the court order, 100 percent compliance 15 required.

They also contest the state's position that only general-purpose school expenditures should be considered in calculating spending inequalities. The state, they argue, has tended to perpetuate historic inequalities through the way it distributes some other types of state aid, such as money to shield districts from the impact of declining enrollment.

"There simply is no justification for those disparities, even if they are not strictly wealth-related." said Richard Rothchild, a lawyer for the plaintiffs.

In attempting to persuade the state supreme court, however, Mr. Rothchild and his clients will face the hostile testimony of several expert witnesses, including some who have switched sides in the decade-long battle.

Finance Expert 'Mystified'

"I am mystified as to why the supreme court agreed to take up the case and a little apprehensive about the possible outcome," said James Guthrie, a professor at the University of California and a noted researcher in the field of education finance.

Mr. Guthrie, who testified for the plaintiffs in the original Serrano trial, now supports the state's position. Forcing sharp cuts in the few districts that still exceed the spending limit, he said, would only penalize the students there.

"And for what? For the sake of some egalitarian principle?" Mr. Guthrie asked. "I hate to say this, but sometimes you have to rise above principle."

Bill Honig, California's superintendent of public instruction, said he was optimistic that the state would prevail.

"California has made amazing progress toward equalizing spending across the state," he said through a spokesman. "I believe California is now one of the most equalized states in terms of educational opportunity."

Vol. 06, Issue 02, Page 6

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