School Districts Sue Honig for Funding Parity

Charging that the state has failed to comply with a state Supreme Court decision requiring equal funding to schools, the Capistrano Unified School District and eight other districts on Wednesday sued state schools chief Bill Honig in an effort to balance funding statewide.

The lawsuit, filed in Orange County Superior Court, charges that the state has failed to live up to the 1974 Serrano vs. Priest decision, which held that wide funding gaps between school districts was unconstitutional. The decision was upheld by the state Supreme Court in 1976.

The suit, which charges that the state’s formula treats children “in an invidious and irrational manner,” will be handled by John McDermott, a Los Angeles attorney who also handled the first Serrano-Priest case through its state Supreme Court hearing.

At a press conference at the Capistrano district’s headquarters, McDermott said some school districts around the state receive up to $1,000 more per student than other districts in the same county.

The lawsuit seeks a ruling that the state’s school finance system is unconstitutional and a directive to the Legislature “to devise a constitutional system of finance” within one year, with periodic progress reports from Honig.

Jacqueline Cerra, a spokeswoman for the Capistrano district, said the state superintendent of public instruction is named defendant in the suit because “he is responsible for distribution of (education) funds” in the state. Honig could not be reached for comment.

Joseph Symkowick, general counsel for the state Department of Education, said that a similar challenge was struck down in Los Angeles Superior Court in 1983. The state Supreme Court refused to hear an appeal in September, 1987.

“We’re under the same school financing system as we’ve been under essentially for more than 10 years now,” Symkowick said. “That system has undergone an extensive review . . . . (in the Los Angeles case) the appellate court upheld the lower the court finding that the financing system met the test of the equal protection clause of the (state) Constitution.”

McDermott said that while the Legislature has made “significant strides” in bringing the state into compliance with Serrano-Priest, it has failed to fully comply with the 1974 ruling of Judge Bernard S. Jefferson, who ordered funding disparities between school districts to be reduced to less than $100 per pupil by 1980.

Jefferson’s ruling “was supposed to get the job done, and here we are in 1990 and the job still isn’t done,” McDermott said. “There is no mechanism currently in place in state law to get rid of those inequalities.”

The inequalities can be traced to Proposition 13, McDermott said. According to the lawsuit, “before Proposition 13, high-spending districts received a much greater portion of their revenue from local property taxes than did low-spending districts. Thus, rich districts would have had their budgets reduced substantially, far more so than poor districts” after Proposition 13 passed.

To offset those lost property tax revenues, the Legislature authorized bailout funds, or systematic increases based on student attendance. The problem, the suit charges, was that instead of equalizing funding, the Legislature simply provided school districts with up to 91% of what they had been getting from taxes before Proposition 13, thus leaving the disparities between so-called “low-wealth” districts and wealthy districts intact.

“By substituting funds for lost property-tax revenue, the Legislature re-enacted and re-created the same spending disparities that existed before Proposition 13,” the lawsuit says. The result, McDermott said, is that a district with high property values can get hundreds--or perhaps thousands--of dollars per student more than a district right next door.

For example, Capistrano Unified received $2,832 per student in fiscal 1990, compared with $3,113 per pupil in the neighboring Newport-Mesa Unified School District. But McDermott said that because the upscale Newport Beach/Costa Mesa area receives so much money from property taxes, it has more money to spend on schools--in fact spending $966 more per student than in Capistrano Unified.

“There’s just no reason why the state gives out $3,000 to one school district and $2,000 to another,” McDermott said.

He added that the Legislature had been moving toward closing the gap by giving larger cost-of-living adjustments to poorer districts than to richer ones, but slowed its efforts after the 1983 Los Angeles case. The Superior Court ruled then that the state was largely in compliance with Serrano-Priest if gaps between districts were not more than $260 per pupil, or the $100 per pupil mandated in the original Serrano-Priest decision adjusted for inflation.

But McDermott argued that the $100 per pupil was meant to apply in current dollars in any year, and even if the $260-per-pupil level is upheld, the disparities often are even greater.

Besides Capistrano, the districts named as plaintiffs are the Magnolia Elementary District in Orange County; New Haven Unified, Alameda County; Delano Union Elementary, Kern County; Lucia Mar Unified, San Luis Obispo County; Laguna Salada Union Elementary, San Mateo County; Oak Grove Elementary, Santa Clara County, and Barstow Unified and Redlands Unified, both of San Bernardino County.

SCHOOL DISTRICTS’ REVENUE PER STUDENT

State revenue per student, from lowest to highest, for Orange County unified districts with average daily attendance over 1,500.

Avg. Daily Revenue Per District Attendance Student Capistrano Unified 26,372 $2,832 Brea Olinda Unified 4,696 2,832 Placentia Unified 20,917 2,832 Garden Grove Unified 36,789 2,844 Irvine Unified 20,761 2,851 Orange Unified 24,566 2,853 Santa Ana Unified 41,493 2,855 Saddleback Valley Unified 24,613 2,859 Tustin Unified 10,626 2,887 Laguna Beach Unified 2,078 2,960 Newport-Mesa Unified 16,069 3,133 Los Alamitos Unified 6,192 3,288

Source: Individual districts; plaintffs’ lawsuit