N.M.'s Highest Court Settles Question Over School Funding Deductions

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Santa Fe, N.M.

The New Mexico Supreme Court says annual certification from the federal government is required before state education officials can withhold funds for public school districts based on how much federal aid they receive.

The ruling came this week in a 2010 case involving the Zuni school district.

The dispute centered on a funding formula that takes into account federal dollars meant to help districts that have a limited tax base due to tribal lands, military installations, or other federal lands that are exempt from property taxes.

The court found that the state erred in lowering the district's monthly allotments of state equalization funding before getting federal approval.

However, the court also found that the school district ended up getting more than it was entitled to in state aid for the 2010 fiscal year so it denied Zuni's request for funding.

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