The opinion
SUPREME COURT OF THE STATE OF NEW YORK
Appellate Division, Fourth Judicial Department
699
CA 15-02049
PRESENT: CENTRA, J.P., LINDLEY, CURRAN, TROUTMAN, AND SCUDDER, JJ.
UNIQUE BROWN, BY HER PARENT AND NATURAL
GUARDIAN DENISE STEVENS, FINA BELL, SIRMANUEL
BELL AND MARK BELL, BY THEIR PARENTS AND
NATURAL GUARDIANS RUSSELL AND TAMMY BELL, OPINION AND ORDER
SAMANTHA CRUZ, BY HER PARENT AND NATURAL
GUARDIAN MARIA DALMAU, GISELLE ALOMA JACOBS,
BY HER PARENT AND NATURAL GUARDIAN INGRID
JOHNSON-JACOBS, TISHAWN WALKER, BY HIS
GRANDMOTHER AND LEGAL GUARDIAN MICHELLE
EMANUEL, AND NORTHEAST CHARTER SCHOOLS
NETWORK, INC., PLAINTIFFS-RESPONDENTS,
V
STATE OF NEW YORK, DEFENDANT-APPELLANT,
ET AL., DEFENDANTS.
ERIC T. SCHNEIDERMAN, ATTORNEY GENERAL, ALBANY (ZAINAB A. CHAUDHRY OF
COUNSEL), FOR DEFENDANT-APPELLANT.
HERRICK, FEINSTEIN LLP, NEW YORK CITY (LEAH KELMAN OF COUNSEL), AND
CONNORS LLP, BUFFALO, FOR PLAINTIFFS-RESPONDENTS.
Appeal from an order of the Supreme Court, Erie County (Donna M.
Siwek, J.), entered June 19, 2015. The order, insofar as appealed
from, denied that part of defendants’ motion seeking to dismiss the
complaint against defendant State of New York.
It is hereby ORDERED that the order insofar as appealed from is
unanimously reversed on the law without costs, the first cause of
action is dismissed insofar as it is asserted by plaintiff Northeast
Charter Schools Network, Inc., the complaint is dismissed insofar as
plaintiffs seek injunctive relief, and judgment is granted in favor of
defendant State of New York as follows:
It is ADJUDGED and DECLARED that the charter school
funding scheme of the State of New York has not been shown
in this case to be unconstitutional.
Opinion by TROUTMAN, J.:
I. Background
Plaintiffs are seven students who attend four nonparty charter
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schools located in Buffalo and Rochester (hereafter, infant
plaintiffs), and Northeast Charter Schools Network, Inc. (Network), an
advocacy group of which those charter schools are members. In
September 2014, plaintiffs commenced this action against, inter alia,
the State of New York (defendant) challenging the validity of
defendant’s charter school funding scheme under the New York State
Constitution. More particularly, plaintiffs allege that defendant’s
refusal to provide charter schools with facilities funding violates
its obligation to provide the charter school students with a sound
basic education under the Education Article (NY Const, art XI, § 1),
and denies plaintiffs the equal protection of the laws under the Equal
Protection Clause (art I, § 11).
According to the allegations set forth in the complaint, New
York’s charter schools receive approximately 60 to 80 cents for every
dollar received by traditional public schools. A “major factor”
contributing to the funding gap is that the Legislature does not
provide charter schools with facilities funding, a particular category
of funding generally made available only to traditional public
schools. The lack of facilities funding, plaintiffs allege, forces
charter schools to divert funds away from student instruction to cover
construction, renovation, and other facilities costs. As a result,
charter schools have “inadequate facilities, such as cafeterias with
no kitchens, cramped classrooms with insufficient windows and
lighting, and inadequate desk and seating space.” They also lack “key
resources, such as science labs, computer rooms, libraries,
gymnasiums, art and music rooms, and theater space.” Plaintiffs
submit that such facilities are constitutionally inadequate, and
present a barrier to the charter school students’ right to a sound
basic education. Plaintiffs nonetheless cite to test scores and
graduation rates, which they allege “demonstrate that the charter
schools are outperforming the district schools” in both Buffalo and
Rochester. For example, a high school student at a traditional
Buffalo public school has a 56% chance of graduating in four years; a
high school student at a Buffalo charter school has an 83.6% chance of
doing the same. For that reason, plaintiffs allege, parents
increasingly choose to send their children to charter schools, which
have inadequate facilities and instrumentalities of learning, to avoid
poorly performing traditional public schools. Plaintiffs further
allege that the impact of the funding gap disproportionately falls on
racial and ethnic minority groups, which comprise over 90% of charter
school students. The first cause of action asserts a claim under the
Education Article; the second and third causes of action assert equal
protection claims under disparate treatment and disparate impact
theories, respectively. For relief, plaintiffs seek a declaration
that defendant’s failure to provide facilities funding to charter
schools is unconstitutional and a judgment enjoining defendant from
“withholding” facilities funding.
Defendant, along with other defendants, filed a pre-answer motion
to dismiss the complaint on the grounds that, inter alia, the
complaint fails to state a cause of action, the Network lacks capacity
to bring the action, and plaintiffs lack standing under the Education
Article. Supreme Court granted the motion only to the extent of
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dismissing the complaint against the other defendants. We conclude
that the Network lacks standing to sue under the Education Article and
that the complaint fails to state a cause of action. Thus, the court
erred insofar as it denied defendant’s motion with respect to those
grounds and the injunctive relief sought by plaintiffs. We note, in
addition, that the court erred in failing to declare the rights of the
parties (see generally Hirsch v Lindor Realty Corp., 63 NY2d 878, 881;
Seneca Nation of Indians v State of New York, 89 AD3d 1536, 1538, lv
denied 18 NY3d 808).
II. Network’s Legal Capacity to Sue
We address first defendant’s contention that the Network lacks
legal capacity to challenge the constitutionality of charter school
funding legislation on behalf of its member charter schools because
charter schools are political subdivisions of the State. We reject
that contention. There is no dispute that the Network has the
capacity to sue under the circumstances of this case if its member
charter schools have such capacity (see generally New York State Assn.
of Small City Sch. Dists., Inc. v State of New York, 42 AD3d 648,
649). It is also true that each charter school is “a political
subdivision” (Education Law § 2853 [1] [c]; see L 2014, ch 56), and
that “[t]he general rule of law is that a political subdivision of the
State may not challenge the constitutionality of an act of the State
Legislature restricting its governmental powers” (Town of Black Brook
v State of New York, 41 NY2d 486, 488; see City of New York v State of
New York, 86 NY2d 286, 291-292). Nevertheless, charter schools
benefit from a broad exemption from all “state and local laws, rules,
regulations or policies governing . . . political subdivisions . . .
except as specifically provided in the school’s charter or in [article
56 of the Education Law]” (§ 2854 [1] [b]). Here, defendant does not
allege that the charters of any of the schools specifically prohibit
them from challenging the constitutionality of legislative acts, nor
that article 56 specifically prohibits the schools from doing so. We
therefore conclude that the Network has the legal capacity to bring
this constitutional challenge on behalf of its members.
III. Standing to Assert a Cause of Action Under the Education Article
A. Network’s Standing
We agree with defendant, however, that the Network lacks standing
to sue defendant under the Education Article. As with capacity, the
Network has standing only if its member charter schools do (see New
York State Assn. of Nurse Anesthetists v Novello, 2 NY3d 207, 211)
and, here, we conclude that the member charter schools do not have
standing. To establish standing, a member charter school would have
to allege an injury or interest that falls within the zone of
interests that the Education Article protects (see Matter of Assn. for
a Better Long Is., Inc. v New York State Dept. of Envtl. Conservation,
23 NY3d 1, 6; Society of Plastics Indus. v County of Suffolk, 77 NY2d
761, 773). The Education Article does not protect schools; it
protects the “students[’] . . . constitutional right to a ‘sound basic
education’ ” (Paynter v State of New York, 100 NY2d 434, 439, quoting
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Board of Educ., Levittown Union Free Sch. Dist. v Nyquist, 57 NY2d 27,
48). For that reason, the Network lacks standing to sue under the
Education Article on behalf of its member schools, and we therefore
dismiss the first cause of action insofar as it is asserted by the
Network.
B. Infant Plaintiffs’ Standing
Defendant further contends that infant plaintiffs lack standing
to sue defendant under the Education Article because infant
plaintiffs’ allegations are vague, conclusory, and fail to establish
injury in fact. We note, however, that defendant’s contention
erroneously “conflates standing with the merits of the case” (Kosmider
v Garcia, 111 AD3d 1134, 1135 [internal quotation marks omitted]). We
therefore conclude that defendant has failed to meet its burden on its
motion of establishing as a matter of law that infant plaintiffs lack
standing (see U.S. Bank N.A. v Guy, 125 AD3d 845, 847).
IV. The Cause of Action Under the Education Article
Having determined that infant plaintiffs, at least, have standing
to assert a cause of action against defendant under the Education
Article, we now address the merits of that part of defendant’s motion
dealing therewith. The Education Article states: “The legislature
shall provide for the maintenance and support of a system of free
common schools, wherein all the children of this state may be
educated” (NY Const, art XI, § 1). Those words enshrined in the State
Constitution the traditional, centuries-old system of school districts
in which communities make decisions on funding and operating
publically-funded local schools (see New York Civ. Liberties Union v
State of New York, 4 NY3d 175, 181 [NYCLU]; Paynter, 100 NY2d at 442).
Its purpose was to constitutionalize the traditional public school
system, not to alter its substance (see NYCLU, 4 NY3d at 181; Paytner,
100 NY2d at 442). If that system—“which is what is to be maintained
and supported”—offers students a “sound basic education,” then “the
constitutional mandate is satisfied” (Nyquist, 57 NY2d at 48).
The traditional system of public schools carried out the State’s
constitutional mandate for more than 100 years before the Legislature
authorized “a system of charter schools . . . that operate
independently of existing schools and school districts” (Education Law
§ 2850 [2]; see New York Charter Schs. Assn., Inc. v DiNapoli, 13 NY3d
120, 123). Charter schools are not mandated by the State
Constitution, but are independent creations of the Legislature,
fashioned for noble purposes, such as to enhance learning among
students in general and at-risk youth in particular, to encourage
academic innovation, and to offer choices beyond those offered in the
traditional public schools (see § 2850 [2]). Although charter schools
are deemed to be public schools under the auspices of the Board of
Regents (see §§ 2850 [2] [e]; 2853 [1] [c]), they are governed by an
independent, self-selecting board of trustees and are exempt from a
multitude of rules and regulations that are applicable to traditional
public schools (see §§ 2853 [1] [f]; 2854 [1] [b]). For example,
charter schools are not obliged to educate “all the children” within
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their respective districts (NY Const, art XI, § 1), but instead may
place a cap on admission (see § 2854 [2] [b]).
New York’s charter school law aims for both fiscal integrity and
academic achievement. Charter schools receive public monies paid
directly from the local school districts on a per capita basis under a
fixed formula (see Education Law § 2856 [1]). To obtain approval for
a charter, a prospective school must submit a detailed application
showing that, given the funds available, the school will be able to
achieve the student performance standards set by the Board of Regents
(see § 2851 [2]), standards which the Court of Appeals has ruled
exceed the constitutional floor (see Campaign for Fiscal Equity v
State of New York, 86 NY2d 307, 315-316 [CFE 1]). Once approved, each
charter school periodically must apply to renew its charter, at which
time it must demonstrate progress in achieving its educational
objectives (see § 2851 [4] [a]). Underachieving schools may be closed
without violating the Education Article (see generally Pinnacle
Charter Sch. v Board of Regents of the Univ. of the State of N.Y., 108
AD3d 1024, 1027, appeal dismissed 21 NY3d 1029, lv denied 22 NY3d
951).
Given the foregoing constitutional and statutory scheme, we
conclude that the Education Article cannot serve as a legal basis for
challenging the constitutionality of charter school funding
legislation. The well-established analytical framework for an
Education Article claim requires that a plaintiff plead deficient
inputs, such as inadequate teaching, facilities, or instrumentalities
of learning; deficient outputs, such as poor test results and
graduation rates; and a causal connection between the deficient inputs
and outputs (see Paynter, 100 NY2d at 440; CFE 1, 86 NY2d at 318).
More fundamentally, “because school districts, not individual schools,
are the local units responsible for receiving and using state funding,
and the State is responsible for providing sufficient funding to
school districts, a claim under the Education Article requires that a
district-wide failure be pleaded” (NYCLU, 4 NY3d at 182).
There is, in our view, no meaningful way to apply those
requirements in the context of a charter school funding challenge. In
this particular action, the thrust of the complaint is that infant
plaintiffs were forced into charter schools that suffer deficient
inputs, in order to avoid traditional public schools that suffer
deficient outputs. They do not and cannot allege that the charter
schools’ allegedly deficient inputs cause the traditional public
schools’ allegedly deficient outputs. Moreover, even assuming,
arguendo, that plaintiffs have pleaded a district-wide failure in the
Buffalo and Rochester city school districts, the provision of
facilities funding to charter schools cannot be considered a proper
remedy for such a deficiency. To the contrary, to divert public
education funds away from the traditional public schools and towards
charter schools would benefit a select few at the expense of the
“common schools, wherein all the children of this State may be
educated” (NY Const, art XI, § 1). We therefore conclude that
plaintiffs’ cause of action based on the Education Article fails as a
matter of law.
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V. The Cause of Action for Denial of Equal
Protection, Disparate Treatment
We likewise agree with defendant that the court erred in
concluding that plaintiffs stated causes of action for the denial of
“equal protection of the laws of this state” (NY Const, art I, § 11).
In their second cause of action, plaintiffs assert a denial of equal
protection based on a disparate treatment theory. Plaintiffs allege
that Buffalo and Rochester public schools receive facilities funding
while charter schools do not. In support of its motion to dismiss,
defendant sets forth numerous rationales for the disparity in funding.
For example, charter schools are exempt from costly regulations that
apply only to traditional public schools, have the discretion to limit
their enrollment, are nonunion, and have access to sources of funding
that public schools do not. A further legislative rationale for the
disparity in facilities funding is that charter schools are
experimental and more likely to be transitory (see J.D. ex rel.
Scipio-Derrick v Davy, 2 A3d 387, 395 [NJ Super Ct, App Div 2010]).
Contrary to plaintiffs’ assertion, charter schools do not receive
precisely “zero dollars” for facilities. Plaintiffs concede, even in
the allegations of their complaint, that charter schools receive
public funds pursuant to the statutory scheme, and that some of those
funds are spent on facilities costs. Thus, to the extent that the
school funding scheme provides traditional public and charter schools
with disparate levels of funding, we conclude that the scheme is
supported by a rational basis (see Reform Educ. Fin. Inequities Today
[R.E.F.I.T.] v Cuomo, 86 NY2d 279, 285). Furthermore, to the extent
that this cause of action is based on the disparate levels of
facilities funding between upstate and downstate charter schools,
plaintiffs conceded at oral argument of this appeal that they do not
seek to invalidate legislation that provides facilities funding to
certain New York City-based charter schools. We therefore conclude
that plaintiffs’ second cause of action fails as a matter of law.
VI. The Cause of Action for Denial of Equal
Protection, Disparate Impact
In their third cause of action, plaintiffs set forth a cause of
action for denial of equal protection based on a disparate impact
theory. Plaintiffs allege that defendant’s failure to provide charter
schools with facilities funding impacts racial and ethnic minorities
more severely. We agree with defendant that plaintiffs’ acknowledged
failure to plead discriminatory intent is fatal to their cause of
action (see CFE 1, 86 NY2d at 320). We therefore conclude that
plaintiffs’ third cause of action fails as a matter of law.
VII. Conclusion
Accordingly, we conclude that Network lacks standing to sue
defendant under the Education Article and that the first cause of
action should therefore be dismissed insofar as it is asserted by
Network. We further conclude that the complaint fails to state a
cause of action and that it should be dismissed insofar as plaintiffs
seek injunctive relief. Finally, judgment should be granted to
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defendant declaring that defendant’s charter school funding scheme has
not been shown in this case to be unconstitutional.
Entered: October 7, 2016 Frances E. Cafarell
Clerk of the Court