School funding showdown in Kansas
It would be better for Kansas schools to start the next school year $1 billion short on funding rather than face the possibility of closure, a lawyer for the state argued Tuesday before the Kansas Supreme Court.
But a lawyer for the school districts suing the state over funding said that would be unworkable. He suggested the state take the money for schools from other state operations that are not mandated by the state constitution.
The court held a hearing to weigh HB 2655, a law that legislators hope will address a February court order to make school funding more fair. The court threatened to close schools if the state did not find a solution by June 30.
Solicitor General Stephen McAllister tried to persuade the openly skeptical justices to accept the law – which gives most school districts the same amount of aid they were already set to receive – as a one-time fix to get districts through the next school year until lawmakers can pass a new school finance formula in 2017.
How many years do we operate unconstitutionally before we say, you know, the music’s got to stop and we’ve got to stop dancing?
Justice Dan Biles
Justice Dan Biles noted with exasperation that this case has been litigated since 2010.
“How many years do we operate unconstitutionally before we say, you know, the music’s got to stop and we’ve got to stop dancing?” Biles said.
McAllister said if the court rejects the law, it should consider other remedies before striking the whole of the state’s school finance system.
“We’ll be equitable if everybody has no money, but we won’t be adequate,” he said, noting that the court still has to rule on whether the state provides enough funding for schools.
Striking all the districts’ local option budgets “would be preferable to taking the whole system,” he said.
Local option budgets, which the court dispute focuses on, are drawn from local property taxes and account for about $610 million statewide.
Districts with higher property values are able to raise money more easily. The state provides about $450 million in equalization aid to supplement poorer districts’ local option budgets.
McAllister said the court could block distribution of these pools of money to temporarily resolve the inequity issue and allow schools to continue to operate until the Legislature reconvenes in January.
‘Take the money from KDOT?’
Under that scenario, districts would have about $3.4 billion in operating funding to kick off the school year.
Chief Justice Lawton Nuss questioned how this would ensure budgetary stability for school districts, a goal that has repeatedly been touted by lawmakers.
Alan Rupe, the attorney for the plaintiff school districts, including Wichita, said it would be impracticable to start the year on short finances.
“Severing that would have a disastrous effect,” Rupe said.
Wichita superintendent John Allison said there was no difference between ordering the schools closed and withholding a quarter of the funding.
“They’re basically one and the same. One of them does it officially on a given date, and the other would in essence create the same issue. … We’re talking a matter of weeks that we’d be able to pay the bills and have the doors open,” he said.
Rupe suggested the court avoid closing schools if possible. He said the court should lift a stay on a ruling by a lower court, which ordered the state to restore equalization money cut from districts when the state implemented block grants last year.
He said the justices should force the Legislature to take money from other areas in the budget that aren’t constitutionally protected and redirect it to schools if lawmakers are unwilling to pass a plan to generate enough revenue to fund schools.
So we should tell them to take the money from KDOT?
Chief Justice Lawton Nuss, responding to a school attorney’s suggestion that the state take the money from other state departments
“So we should tell them to take the money from KDOT?” Nuss asked, referencing the Kansas Department of Transportation. The state has taken money from the department repeatedly to shore up its general fund budget.
Rupe said the court could allow lawmakers to make that choice.
McAllister said ordering the state to take money from other agencies would be a “lawless and unprecedented action.”
Sen. Ty Masterson, R-Andover, one of the new law’s main architects, observed the court hearing and said he was struck by how the litigants “talk about the Legislature as though it’s a person they can compel to do something and not a diverse group of representatives.”
Justices question law
The law before the court changes the way the state calculates equalization aid for school districts. It was passed in response to the February court ruling that found the current block grant funding system unconstitutionally inequitable. The block grant system was proposed by Gov. Sam Brownback and passed by the Legislature last year.
McAllister reminded the justices that the February ruling said there were multiple ways to equalize funding among districts and said the question is “whether the court meant what it said.”
The justices peppered McAllister with questions as how the law tangibly fixes the problem of inequity.
“Why are we in any different position than we were when we looked at this last time?” Justice Marla Luckert asked.
McAllister said the law does direct $2 million more toward equalization aid and increases funding for 23 school districts.
All other districts, including Wichita, would receive the amount of total state aid they already were set to receive under the block grants.
The law changes how that money is classified in a way that lawmakers say fixes the inequity in the local option budget. But justices questioned whether it really resolves the issue.
“It’s the same number,” noted Biles, a former lawyer for the state Board of Education.
A visual aid distributed by the plaintiffs’ attorneys showed funding under the block grant and HB 2655 as stacks of Legos that are equal in height. The only difference is the color of the blocks.
Both stacks are smaller than a third set of blocks meant to represent funding under the old equalization formula, which lawmakers repealed last year.
The court told the Legislature in February that restoring the old formula would be a safe harbor and satisfy the requirement for equitable funding. The old formula provided districts equalization aid if they fell below the 81.2 percentile for average property value per student.
The new law relies on the median value to calculate aid, resulting in a less generous gain for school districts.
McAllister disputed that reliance on the 81.2 percentile, adopted after the 2005 Montoy case, was based on anything other than politics. “There’s nothing magical about the 81.2,” he said, repeatedly noting that lawmakers turned to education experts for advice in crafting the new law.
“When you’re talking about experts, you’re talking about Mike O’Neal, Dave Trabert?” Biles asked at one point, referring to the president of the Kansas Chamber of Commerce and the head of the Kansas Policy Institute, a free-market think tank, both of whom testified on the bill.
“The court isn’t supposed to be editorial cartoonists and calling into question someone’s integrity and expertise,” Trabert said when reached by phone. “And Biles, I guess, didn’t see any problem with that.”
Trabert noted that the KPI took a neutral stance on the bill, but he did say he thinks the law satisfies the equity requirement and that the court should approve it.