Court Rules Mich. Underpaid Spec. Ed. Funding to Districts

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The state of Michigan has grossly underpaid its share of school districts' special education costs over the past two decades, the state's highest court ruled last week.

But the court did not dictate how the state must compensate the 84 districts that first filed suit over the issue in 1980. Lawyers for both sides now must file briefs detailing their views on appropriate remedies.

The Michigan Supreme Court stopped short of upholding a 1995 appeals court decision that ordered the state to pay the districts $492 million in compensation. With interest, that sum now totals more than $600 million, said Dennis R. Pollard, the lead lawyer for the districts.

The high court, however, affirmed the appellate court order that the state pay the lawyers' fees for the districts, which totaled $1.3 million in 1994 and have risen by several hundred thousand dollars since then, Mr. Pollard said.

"This is a milestone," Mr. Pollard said. "We've won the legal issues at every step. Now the question is remedy."

Lawyers for the state and the districts must file their recommendations by the end of this month, according to the June 10 order.

Mr. Pollard said the districts would ask the supreme court to uphold the $492 million award, plus interest, as damages for the plaintiff districts.

Chris DeWitt, a spokesman for the state attorney general's office, said the state's lawyers were still discussing their response.

The state education department would not comment on last week's decision.

Ban on Unfunded Mandates

The districts sued over a 1978 state constitutional amendment that barred so-called unfunded mandates and ordered the state to pay half of the costs of any program it required. Michigan never came close to that mark on special education, the districts said.

The state argued that special education is a federal, not state, mandate over which the Michigan Constitution has no authority, Mr. DeWitt said. "We took the position that [a lack of special education funding] was not a violation of state law," he said.

Mr. Pollard, however, compared the state to a person who does not pay the charges he runs up on a credit card, then balks when the credit-card company charges interest. "These are people who very knowingly violated the [state] constitution," he asserted. "We're very pleased that at long last the court has ruled on it."

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