Judge upholds Missouri's school funding method

JEFFERSON CITY, Mo. -- A state judge on Wednesday upheld Missouri's school funding method, rejecting claims by schools that it distributes money unfairly and inadequately.

Cole County Circuit Judge Richard Callahan ruled that the state constitution provides no guarantee of absolute "equity, equality or adequacy in the dollars spent" or in the facilities available from one school district to another.

The ruling marks a major loss for about half the state's 524 school districts, who sued more than three years ago on claims Missouri does not direct enough money to public education and doles out the money unfairly.

Alex Bartlett, an attorney for the suing schools, said he will recommend an appeal to the state Supreme Court.

Missouri spent about $2.7 billion in basic aid to schools last year. It was distributed under a formula that sets a per-pupil spending target, based on the spending levels of schools that got perfect marks on a state performance report.

Experts for the suing schools had called for spending anywhere from an additional $480 million to $1.3 billion per year on public schools. Legislative leaders and Gov. Matt Blunt had voiced concerns about raising taxes if the judge were to have sided with the schools' argument.

But Callahan said he was not convinced that the constitution requires any funding beyond its stipulation that at least one-fourth of revenue must be dedicated to schools.

The only issue Callahan left unresolved is whether the state is meeting the 25 percent threshold. The judge set a Sept. 20 hearing for additional arguments on exactly what state revenue should be included or excluded in that calculation.

State budget officials testified during the trial that Missouri spent nearly 36 percent of its budget on public education.

Bartlett contends it is significantly less, because he believes only general state tax revenue -- not lottery revenue, casino taxes and other earmarked funds -- should be included in that calculation.

Blunt claimed Wednesday that the lawsuit "was designed to mandate a billion-dollar tax increase on Missouri families," though schools already have been receiving annual funding increases from the state. He called the decision "a victory for Missouri students."

Attorney General Jay Nixon, who defended the law, said the court had ruled for the state on all claims raised by the schools.

Because state aid is supplemented with local property tax revenue, spending by Missouri's public schools varies widely.

For example, spending by K-12 school districts ranged from a low of $4,704 in Diamond to a high of $13,846 in Clayton during the 2004-2005 school year.

Callahan's decision "is a loss for the kids," said Crane Superintendent Tyler Laney, a leader of the Committee for Educational Equality that brought the lawsuit.

"Because if this is the final ruling, we have just stated that the system we have in place -- which is not fair -- is fair."

The Missouri School Boards' Association said the ruling seems to shift the burden of complying with state and federal educational mandates to local taxpayers.

But attorney Josh Schindler, whose taxpayer clients intervened as a defendant to the lawsuit, praised the "very well-thought-out decision" as a victory for both taxpayers and the legislative process.

"The language of Judge Callahan's ruling is so strong and the defeat to the (suing schools') arguments so complete that it is my hope that the school districts -- and in particular taxpayers -- will stop this litigation before we continue to waste additional dollars on an appeal," Schindler said.

Senate Majority Leader Charlie Shields, who helped craft the school funding formula, also urged school districts to drop their financial support for the lawsuit.

"If as a result of this ruling, if some of districts will decide to spend their money on teachers instead of lawyers, I think that's good news for kids," said Shields, R-St. Joseph.

In 1993, one of Callahan's predecessors struck down the state's school funding method, determining among other things that the Missouri Constitution did establish an adequate school funding right beyond the 25 percent requirement.

But Callahan noted that decision was never tested on appeal, because the Legislature changed the funding formula later that year and raised taxes to pump more money into education.

To the contrary, Callahan wrote, two Supreme Court judges issued a concurring opinion in dismissing that 1993 appeal asserting that appropriations over that 25 percent threshold were within the discretion of the Legislature. Callahan adopted similar reasoning, concluding that the constitution says lawmakers "may" -- not "must" -- choose to spend additional money if public school funding is insufficient.

Callahan also rejected claims that the school funding formula violated the equal protection clauses of the state and federal constitutions. Education is not a fundamental right guaranteed by the U.S. Constitution, he said. The only equality standard for school funding in the state constitution was removed in 1875, Callahan added.

After school districts filed suit challenging Missouri's school funding method in January 2004, the Legislature passed a revised funding method during its 2005 session.

Callahan ruled the funding system adopted by the Legislature "is a reasonable attempt to meet its obligations" under the constitution to maintain a public school system.