judgement in favor gilbert public school district

8/14/2019 Judgement in Favor Gilbert Public School District

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Michael K. Jeanes, Clerk of Court*** Electronically Filed ***

02/16/2010 8:00 AM

SUPERIOR COURT OF ARIZONAMARICOPA COUNTY

CV 2007-017981 02/11/2010

Docket Code 019 Form V000A Page 1

CLERK OF THE COURTHONORABLE DEAN M. FINK S. Brown

Deputy

GILBERT UNIFIED SCHOOL DISTRICT NO 41 PAUL F ECKSTEIN

v.

ARIZONA STATE, et al. KEVIN D RAY

REBECCA K SETLOWCHAD BRADLEY SAMPSON

MINUTE ENTRY

Each party has submitted a motion for summary judgment; the state has also submitted amotion for judgment on the pleadings. All three motions cover essentially the same ground, andwill be discussed as one. The Court took these matters under advisement following oralargument on October 19, 2009. Subsequently, the Court received, and has now considered:(1) Defendants Notice of Supplemental Authority in Support of Defendants Motion forSummary Judgment, filed November 23, 2009, (2) Gilbert Unified School District No. 41sResponse to Defendants Notice of Supplemental Authority, filed December 4, 2009, and (3)Defendants Reply to Gilbert Unified School District No. 41s Response to Defendants Noticeof Supplemental Authority, filed December 14, 2009.

The general question presented is whether a funding program effectively limited to 28 ofthe states school districts, and under which the 28 participating school districts annually receivefunds based on the formula utilized for all school districts plus an additional 5.5.% creates adeparture from the constitutional requirement of a general and uniform public school system.

For the motion for judgment on the pleadings, all well-pled facts in the Complaint are tobe taken as true; in any event, the material facts do not appear to be in dispute. In 1985, the


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Career Ladder Program was created by the legislature as a five-year pilot program to improve thequality of teaching and thus of education in participating districts. In the early years, the numberof districts allowed to participate grew, in increments of seven, from the original seven to 28;however, since 1994 no new districts have been allowed to participate. Plaintiff Gilbert UnifiedSchool District (the District) argues that the effect of the Career Ladder Program has been toallow participating districts to outbid non-participating districts for the best teachers, resulting inan impermissible disparity between the two classes of districts.

Turning first to the States procedural objections, counsel for the State did not address theapplicability of laches at oral argument. Laches is the equitable counterpart of a statute of

limitations, and is to be invoked when under the totality of circumstances, the claim, by reasonof delay in prosecution, would produce an unjust result. Harris v. Purcell, 193 Ariz. 409, 410 1 n.2 (1998). Such a finding requires that the adverse party suffer actual prejudice from thedelay.Id. at 412 16. The State has suffered no prejudice; even assuming that the interests ofthe participating districts, non-parties to this action, are to be considered, they would not beprejudiced by losing a flow of funds to which they were not entitled in the first place, and theDistrict does not seek retrospective relief requiring them to disgorge funds already spent.Furthermore, the assumption that a decision in the Districts favor will result in the destructionof the Career Ladder program and the impoverishment of the teachers in the participatingdistricts is not necessarily a sound one, and depends on the remedy selected by the legislature,not the decision of this Court.

The statute of limitations defense also fails. The State is correct that the District iscovered by A.R.S. 12-821. School districts are included within the scope of A.R.S. 12-510,which excludes political subdivisions from certain statutes of limitations. Tucson Unified School Dist. v. Owens-Corning Fiberglas Corp., 174 Ariz. 336, 337-38 (1993). However, the latterstatute applies only to statutes of limitations codified in Chapter 5 of Title 12, not to A.R.S. 12-821, which is found in Chapter 7. The common-law exemption of political entities from statutesof limitations cannot stand against the express statutory language.

That said, the Districts action is not time-barred. Entry into the Career Ladder programhas never been formally closed. 1992 Ariz. Sess. Laws Ch. 246 3 expressly authorized theDepartment of Education to approve new districts for the program, provided that the legislatureapproved new funding. If the legislatures implicit promise to fund the program is treated asgenuine, as the Court does not doubt, there is no reason to treat the Districts claim as accruing in1994 or in any other year prior to the most recent application and rejection. At no time was theDistrict informed that it had to apply or be forever excluded, and while, with the passage of theyears, the promise of new money has rung more and more hollow, there was no day prior to itsapplication when it could be said that participation in the Career Ladder program was denied toit. (This distinguishes the present action from Mayer Unified School Dist. v. Winkleman, 219


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Ariz. 562 (2009), in which there was a single discrete act that could be identified as defining theplaintiffs rights for all time.)

Turning next to the uniformity arguments, there is of course no dispute that the CareerLadder program constitutes an infusion of state money into the coffers of 28 districts to theexclusion of the remainder. The State argues that the general and uniform clause requires onlythat the public schools be funded so as to achieve a statewide level of minimum adequacy andprevent substantial disparities between districts; because the District cannot show that its failureto receive the state funding received by the participating districts has resulted in its failure toreach the level of minimum adequacy or the creation of a substantial disparity between it and the

participating districts, its suit fails.

On an evidentiary level, the Court does not see in the record any evidence controvertingthe Districts affidavits that such a disparity exists. At the broader constitutional level, this casedoes not raise the same questions addressed in the RooseveltandAlbrechtopinions. Those casesdealt with the effect of the uniformity clause on the provision of education given the inequalityof property valuation, and thus property tax revenues, from district to district. The SupremeCourt held that the system the legislature chooses to fund the public schools must not itself bethe cause of substantial disparities. Roosevelt Elem. Sch. Dist. v. Bishop (Roosevelt I), 179Ariz. 233, 242 (1994) (plurality opinion); id. at 246 (Feldman, C.J., specially concurring). It is,of course, not suggested that the state is responsible for the disparity in property tax revenue,

which, as the Supreme Court acknowledged, is the product of housing patterns and the freemarket economy. Id. at 242. Thus, the Supreme Court had no occasion to address the non-uniformity found here, non-uniformity in the familiar dictionary sense of unequal state funding.It did, however, provide direction for a case like this one. [N]othing in the constitutionprohibits a school financing system that allows districts to go above and beyond state-mandatedadequate facilities by individually accessing local financing sources. But the general anduniform requirement will not tolerate a state funding mechanism that itself causes disparitiesbetween districts. Hull v. Albrecht (Albrecht II), 192 Ariz. 34, 37-38 (1998). Not onlysubstantial disparities, but all disparities violate the uniformity clause if they are caused by thestate itself.

That there are disparities is evident. The purpose of the Career Ladder program is toattract, through the offer of higher salaries, better-trained teachers, whose expertise in teachingmethods will presumably increase students learning as compared to students with lower-paid,less expert teachers. Having continued it for so many years, the legislature has plainly concludedthat the Career Ladder has achieved its goal. This, of course, is precisely the Districts point: theProgram creates, and exists to create, a difference in educational quality between participatingand non-participating districts. That this difference may be difficult to quantify does not place itbeyond judicial review. The difference in funding levels $68,000,000 in the 2005-06 school


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year and $74,000,000 in the 2006-07 school year for the participating districts versus zero forthe non-participating districts, is sufficient to constitute a judicially discoverable andmanageable standard. Contrast Kromko v. Arizona Bd. of Regents, 216 Ariz. 190, 193 15(2007) (requirement that university education be free would be enforceable, but as nearly freeas possible is not). And while $68,000,000 or $74,000,000 may constitute only a tiny portion ofthe states total education expenditures, it is not de minimis.

The State points out that the District, in fact, pays its teachers a salary comparable to, ifnot higher than, Career Ladder schools. It does so by taxing its residents at a rate higher thanwould be necessary for a merely adequate school system. That is its right underRoosevelt Iand

its progeny. But the Districts inability to access Career Ladder funds forces it into a choice notfaced by the participating districts: use the augmented tax revenues to pay for superior teachersor to provide other benefits for its students. The case law is clear that the residents option to taxthemselves to provide better educational amenities is a permissible departure from uniformity;the State cannot rely on it to create uniformity.

The State argues that a decision in favor of the District would prevent the legislature fromenacting specially targeted programs or pilot programs. The Career Ladder Program is neither.A pilot program is one that may or may not be successful and is being tested on a small,economical scale with a view to extending it generally should it prove its worth. After nearly aquarter-century, the Career Ladder Program can no longer be considered a pilot program. (It is

therefore not necessary for the Court to determine whether the use of pilot programs limited tocertain districts is a violation of uniformity.) And the Career Ladder Program is not a speciallytargeted program. It does not identify and is not designed to compensate for any deficiency inthe participating districts vis--vis the non-participating districts or to raise their educationalperformance to the statewide average; rather, its purpose is to make their educationalperformance better than that of districts not receiving funds by attracting better-trained andpresumably more effective teachers. To the extent it achieves that goal, then, it makes the publicschool system less uniform. The lesson ofRoosevelt I, supra at 242, is that where the lack ofuniformity is the direct result here, indeed, the intendedresult of state action, the uniformityclause is breached.

Addressing the supplemental authority provided by the State after the oral argument, theCourt finds that Federal Way School Dist. No. 210 v. State of Washington , 219 P.3d. 941 (Wash.2009), is not helpful. For one thing, the system upheld in Washington, though it perpetuated(while narrowing over time) teacher salary disparities that existed in the base year 1976-77, id. at 5-7, did not create those disparities, as the Career Ladder Program does. Our precedents makeit clear that, while the state need not correct all exogenous disparities, state action must not itselfbe the cause of disparities. Hull v. Albrecht, 192 Ariz. 34, 37-38 (1998); Roosevelt I, supra, at242 (plurality opinion).


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More fundamentally, the Washington Supreme Court interprets the uniformity clause ofits constitution more restrictively than does ours. Federal Way follows Seattle School Dist. No. 1of King County v. State, 585 P.2d 71 (1978), which found a judicially enforceable constitutionalduty to make ample provision for the education of all children, but held that the organization,administration, and operational details of the general and uniform system required by [the stateconstitution] are the province of the Legislature, id. at 95. Seattle School District, and thusFederal Way, are closer to Kromko v. Arizona Bd. of Regents, supra, which declined as a

nonjusticiable political question a dispute over the permissible level of university tuition. ButKromko did not go so far as Seattle School District, supra, and Federal Way, supra at 23-24, tosay that only the duty to provide is judicially enforceable. Rather, Kromko conditioned justiciability on the existence of a judicially discoverable and manageable standard to evaluatethe alleged breach, supra at 194 21. In fact, the Arizona Supreme Court distinguished theschool-funding cases, specifically Roosevelt, on the ground that a judicially discoverable andmanageable standard does exist as to the general and uniform requirement for elementary andsecondary education, unlike the as nearly free as possible requirement applying to the stateuniversities, and so is subject to judicial review, id. at 195 24. The holding in Federal Way,supra at 24, that implementation of the uniformity clause is the province of the legislativebranch is thus contrary to Arizona case law.

There is nothing in Federal Way School Dist. No. 210 v. State of Washington to cause theCourt to revisit its conclusions.

The District also pleads that the Career Ladder program, as applied, is a special law. (Itis not necessary for the Court to decide whether the Districts appeal to subsection 20 of A.R.S.Const. Art. IV Pt. 2 19, which forbids all special laws when a general law can be madeapplicable, was adequately pled in its Complaint, as the analysis under subsection 13 isdispositive.) The District, citing Webster v. Heywood, 21 Ariz. 550, 552 (1920), and other earlycases, asserts that a school district is a corporation and therefore covered by the ban onlegislation granting special or exclusive benefits to any corporation, association, or individual,A.R.S. Const. Art. IV Pt. 2 19(13). The State argues that a school district is defined by A.R.S. 15-101(21) as a political subdivision of the state; see also Amphitheater Unified School Dist.No. 10 v. Harte, 128 Ariz. 233, 234-35 (1981). The categories are not mutually exclusive. Ourconstitution itself defines cities as both municipal corporations, A.R.S. Const. Art. XIII 1, andpolitical subdivisions, A.R.S. Const. Art. IX 7; see City of Phoenix v. Collar, Williams & White Engineering, Inc., 12 Ariz.App. 510, 514 (1970). While the status of school districts is notexpressly defined, it requires no stretch of logic to harmonize the Supreme Court precedents andtreat them, like cities, as both.


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This interpretation is consistent with the public policy expressed in State CompensationFund v. Symington, 174 Ariz. 188, 192 (1993). The purpose of proscribing special or locallegislation is to prevent the legislature from providing benefits or favors to certain groups orlocalities. [It] also confines the power of the legislature to the enactment of general statutesconducive to the welfare of the state as a whole, to prevent diversity of laws on the same subject,to secure uniformity of law throughout the state as far as possible, and to prevent the granting ofspecial privileges. In addition, it prevents the enlargement of the rights of persons indiscrimination against others rights.... Id. [internal citations and quotation marks omitted,

emphasis added]. Thus, while the state has extensive power to regulate its political subdivisions,that power does not extend to enacting special laws benefiting some and not others.

Not all laws of limited applicability are proscribed special laws. The challengedlegislation must satisfy a three-part test: the classification must be rationally related to alegitimate governmental objective, it must encompass all members of the relevant class, and itmust allow members to move in and out of the class. Republic Inv. Fund I v. Town of Surprise,166 Ariz. 143, 149 (1990). The Court accepts the legislatures judgment that improving thequality of teaching is a legitimate governmental objective and that the Career Ladder program isrationally related to it. It is evident, however, that this objective is legitimate for every district inthe state; there is no basis on which to find it more legitimate for the participating districts. It is

conceded that the primary, if not the sole, criterion for receiving Career Ladder funds is whetherthe district applied for them prior to 1994. (At oral argument, counsel for the State could notrecall whether any district applying in the early years was turned down; the Court takes it that,even if some applications were not approved, rejection was not frequent.) This criterion hasnothing to do with the primary objective. For it to be valid, then, it must be related to some otherlegitimate governmental objective. The only objective suggested, and the only one that comes tothe Courts mind, is the legislatures choice to prioritize state spending by funding the program ata level that allows only a handful of districts to participate. While prudent management of thepublic purse is beyond question a worthy goal, the State does not argue, and the Court is familiarwith no case law holding, that economy is a legitimate basis on which to define the relevantclass. Yet if there is no legitimate governmental objective served by confining the Career Ladderprogram to the initial 28 participants, it fails to encompass all members of the broader class ofdistricts whose educational performance would be improved by participation in the program, nordoes it provide for entry into the favored class. (That, in at least one instance, a district has leftthe program does not satisfy the third prong of the Republic test, which requires free entry aswell as free exit.)

There remains the matter of a remedy. The State urges that the Court wait until the effectof the Teacher Performance Pay system enacted by the legislature in 2008 can be evaluated on its


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actual results instead of the estimates of the parties. This is not, on its face, an unreasonablerequest. See Hull v. Albrecht (Albrecht I), 190 Ariz. 520, 525-26 (1997) (Moeller, J., dissenting).Two objections occur to the Court. First, by its own terms, the new system will not becomeeffective statewide until 2018. Even affording the greatest possible deference to the legislature,it is difficult to justify continuation of a constitutionally defective system for almost a decade.Second, it is long-established law that a legislature cannot be bound by the decisions of itspredecessors. Higgins Estate v. Hubbs, 31 Ariz. 252, 264 (1926); Sedona Private PropertyOwners Assn. v. City of Sedona, 192 Ariz. 126, 128 (App. 1998). As has been amplydemonstrated by the fate of the Career Ladder program, circumstances may overtake promises.The Court must therefore act.

This is not a budgeting case. The Districts prayer can be answered by the legislatureappropriating more money for the Career Ladder Program, or by dividing existing funds amongall the school districts of the state, or by abolishing the program altogether. As the SupremeCourt noted in Roosevelt I, supra at 242, [t]here are doubtless many ways to create a schoolfinancing system that complies with the constitution. Thus, the exclusive power of thelegislature to determine appropriate funding levels is not implicated. However, requiring thelegislature to choose among one of the three options (or four the State, in its motion for judgment on the pleadings, separates the more money option into increasing taxes andcutting other programs sub-options) does not violate the separation of powers. Indeed, it is theduty of the judiciary to determine when the actions of the legislature violate the mandate of the

Constitution.Forty-Seventh Legislature of the State of Arizona v. Napolitano

, 213 Ariz. 482,485 8 (2006).

No doubt the District would prefer to see the program expanded to improve the quality ofeducation it can provide, rather than deprive the participating districts of the benefits they nowenjoy. But the constitution is equally satisfied by extending the program to all or denying it toall, and the Court may not presume to tell the legislature which choice it should make. It maydecide that the program is successful enough to merit its extension to every district in the state.It may decide that the benefit is not worth the cost and terminate the program. What it may notdecide is that the program is successful enough to be offered to the participating districts yet notsuccessful enough to be funded for the rest of the states districts. The Career Ladder Program,as presently structured, is designed to create a two-tier system in which 28 districts are givenpreferential access to the best teachers and the remaining districts must make do with what is leftover. This violates the uniformity clause and the ban on special laws.

Based on the foregoing, as well as the analysis set forth in the Districts briefs and at oralargument, the Court hereby denies the Defendants Motion for Summary Judgment andDefendants Motion for Judgment on the Pleadings and grants Plaintiffs Motion for SummaryJudgment.


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As discussed at oral argument, the Court recognizes the pragmatic difficulty of enjoiningthe Career Ladder program immediately. The participating districts have incorporated the CareerLadder funds into their budgets; their teachers have planned their own lives around their shares.In addition, the legislature is entitled to the reasonable time it needs to choose the best routeforward. The Court, therefore, intends to stay any order of injunctive relief until the appellatecourts can consider the matter, as it has little doubt they will be asked to do. The parties areencouraged to address this issue further in connection with any briefing on the Districtsproposed form of order/judgment, the signing of which will trigger the time for appeal.

IT IS HEREBY ORDERED that the District shall lodge such a proposed order within 45days.

This case is eFiling eligible: http://www.clerkofcourt.maricopa.gov/efiling/default.asp

judgement in favor gilbert public school district

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