# Amicus Curiae Brief — San Antonio Independent School Dist. v. Rodriguez > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386414_0120%3A03 ## Record - **Collection:** Supreme Court brief - **Document type:** Amicus Curiae Brief - **Published:** January 1, 1973 - **Citation:** 411 U.S. 1 ## Text No, 71-1332 In Tue recat - ‘Court of the United States Ocroszr Term, 1971 SAN ANTONIO INDEPENDENT SCHOOL DISTRICT, er At., rome Appellants, 4 I-N-D-E-X Inrerests OF Amici CURIAE STATEMENT OF THE CASE STATEMENT OF FAcTS CONCLUSION Appendix A—Order of Court in Guerra v. Smith (W.D. Tex. July 20,1971) la Appendix B—Lawyers Committee for Civil Rights Under Law, Memorandum of October 29, 1971, filed by plain- tiffs in Milliken v. Green 3a Appendix C—Hearings before the Select Com- mittee on Equal Educational Op- portunity of the United States Sen- ate, 92nd Congress, Ist Session, Part 16 B, September 28, 1971 (testimony of Mrs. Sarah Carey) 10a Appendix D—Shanks, Educational Financing and Equal Protection. 1 Journal of Law and Education 73 (1972)... sts 29a TABLE OF CITATIONS \ Cases Abernathy v. Carpenter, 208 F. Supp. 793 (W.D. Mo.), aff’d 373 U.S. 241 (1963) 12 Adickes v. Kress and Company, 398 U.S. 144 (1970) 12, 15 Alemite Manufacturing Co. v. Staff, 42 F. 2d 832 (2d Cir.1930) te 15 Askew v. Hargrave, 401 U.S. 476 (1971) __ 13, 14, 23 Board of Education of Muskogee v. State of Okla- homa, 409 F. 2d 665 (10th Cir. 1969) 2.0, 12, 15 PACE Burress v. Wilkerson, 397 U.S. 442 (1970) soivias Sig ee Bussie v. Long, 383 F. 2d 766 (5th Cir. 1967) ... 12 Carmichael v. Southern Coal Company, 301 USS. 495 (1937) 10, 11,23 Dandridge v. Williams, 397 US. 471 (1970). 11,2 Employees of Dept. of Public Health v Dept. of Public Health, 452 F. 2d 820 (8th Cir. 197 1) 13 Georgia Ry. Co. v. Redwine, 342 U.S. 299 (1952)... 2B Gordon v. Lance, 403, U.S. 1 (1971) as 10,23 Great No. Life Ins. Co. v. Reed, 322 U.S. 47 (1944) 13 Grey v. Morgan, 371 F. 2d 172 (7th Cir. 1966) ...... 12 Griffin v. Breckinridge, 403 U.S. 88 (1971) 12 Guerra v. Smith, W.D. Tex. No. A-69-CA-9 (W.D. MINA? oe 10 Gunn v. Committee to End the War, 399 U. Ss. 383 (1970) . cae 14 Hornbeak v. “Hamm, 283 F Supp. 549 (MD. ‘Ala. 1967), aff’d 393 U.S. 9 (1968) ......... 12 International Longshoremen’s Association Vv. _ Phila- delphia Marine Trade Association, 389 U.S. 64 COE ok cee eee 14 James v. Valtierra, 402 US. tee 10878) 6 “1, 13, 23 Lindsey v. Normet, 40 L.W. 4189 (U.S. Sup. Ct. MAY ces i oe ee ll Lynch v. Household Finance Co., 40 L.W. 4335 (U.S. Bem. CR 20S) occ... ne McInnis v. Ogilvie, 394 U.S. 322 (1969) oiiaens ‘* 13,23 McInnis v. Shapiro, 293 F. Supp. 327 (N.D. Ill. 1968), aff'd 394 U.S. 322 (1969) ._. 13 MeMillan v. Board of ee 430 F. 2d 1145 (2nd Cir. 1970) . Milliken v. Green (ED. Mich. 1971) - BI 12 Rodriguez v. San Antonio School District, 337 F. Supp. 280 (W.D. Tex. 1971) ........ .1,3,4,9, 1 Samuels v. Mackall, 401 U.S. 41 (1971) ........ Nae ee 12,23 iii PAGE Serrano v. Priest, 5 Cal. 3d 584, 487 P. 2d 124 (1971) 1, 3,9, 10, 11 Snowden v. Hughes, 321 U.S. 1 ( 1944) 12 Spano v. Board of Education, 328 N.Y.S. 2d 229 (Sup. Ct. Westchester Co. 1972) 8,11 United States v. Haley, 358 U.S. 644 (1958) 23 United States v. Ohio, 385 U.S. 9 (1966) 23 Van Dusartz v. Hatfield, 334 F. Supp. 870 (D. Minn. 1971) 10, 11 Watson v. Buck, 313 U.S. 387 (1941) 14 Westbrook v. Mihaly, 2 Cal. 3d 765, 471 P. 2d 487, vacated 403 U.S. 915 (1971) 10 Constitutional Provisions, Statutes, and Rules Federal Rules of Civil Procedure, Rule 65 (d) 14 28 U.S.C. §1341 12 #22 U.S.C. §1983 _ le, 12 _ United States Constitution, Article IV 4 Miscellaneous Advisory Commission on Intergovernmental Rela- tions, Who Should Pay for Public Schools (1971) 19 Andrews, Tax ‘Revolution’, Wall. Street Journal, cousin 0. Geka Ge eeumem Bassett, Leaders of Urban Schools Oppose Dollar-A- Scholar, Baltimore News American, March 16, meee, 1 .....:..: ome cos, 4 Central Advisory Council on Education of Great Britain, Children and Their Primary Schools Coleman, Equality of Educational Opportunity ie a 17 9 iv PAGE’ Coleman, The Struggle for Control of Education, in Bowers (ed.), Education and Social Policy: Local Control of Education (1970) at64 19 Coons, Clune and Sugarman, Private Wealth and Public Education (1969) . ae 4,9, 11 Emerson, Haber’ and Dorsen, Political and Civil Rights in the United States (2d Ed., 1967) . 12 Hazard, Social Justice Through Civil Justice, 36 U. Chi. L. Rev. 699 (1969) 2 Hearings Before the Select Committee on Equal Edu- cational Opportunity, United States Senate, 90th Congress, 2nd Session (1971) ... 2, 3, 4, 5, 6,89 Kirp, The Poor, The Schools, and Equal Protection, in Harvard Educational Review, =e Educa- tional Opportunity (1969) .............. 6 Kurland, Equal Educational Opportunity: The Limits of Constitutional Jurisprudence Undefined, 35 U. Chi. L. Rev. 583 (1968) 0, 13 Lutz, Can the Property Tax Be Replaced? Wall Street Journal, Feb. 9, 1972, pg. 14................. 16 Michelman, On Protecting the Poor Through the Fourteenth Amendment, 83 Harv. L. Rev. 7 6 |) 1 Myers, Second Thoughts on the Serrano Case, City: The Magazine of the National Urban Coalition, Vol. 5, No. 6 (Winter 1971) on... 4 President’s Commission on School Finance, Schools, People, and Money, Final Report (1972) | 7,17 Simons, Economic Policy for a Free Society ( 1948) 7 Taylor, The Richmond Ruling, Washington Post January 16, 1972, pg. Bel ns. 2 United States Office of Education, Finances of Large- City School Systems: A Comparative Analysis 6 | 7} nan 3 Wise, The California Doctrine, Saturday Review, November 20; 1971, pg. 78 ees 7 _ , a : In THE Supreme Court of the United States Ocroser TERM, 1971 No. 71-1332 SAN ANTONIO INDEPENDENT SCHOOL DISTRICT, er at., Appellants, v. DEMETRIO P. RODRIGUEZ, er A ., Appellees. On APPEAL FROM THE UNITED States District Court FOR THE WESTERN District or TExAs BRIEF OF AMICI CURIAE IN SUPPORT OF JURISDICTIONAL STATEMENT INTERESTS OF AMICI CURIAE Amici Curiae are representatives of state governments, o political subdivisions, in States which have sys- tems of school financing which can be viewed as incon- sistent with the Serrano-Rodriguez rule. In most of these States suits are pending as part of a coordinated campaign attacking the nation’s school financing system. In con- sequence of time limitations amici have not been able to cure the joinder in this brief of all forty-nine of the 2 American states with systems of school finance inconsistent with the supposed constitutional principle.! The state and local governments represented by amici curiae all in varying degrees suffer from severe budgetary and financial stringency. The school systems in each and all of the states, including the school systems in the so called “wealthier” districts, have contractual commitments to sup pliers of services, bondholders, and teachers and/or teach- ers’ unions foreclosing any possibility of significant reduc- tion in expenditures in such districts. It has been authori- tatively estimated that the cost of increasing expenditures in each state to the level of the higher districts in the state would approximate 8 billion dollars per annum. In some states this outlay would result in immediate and severe revenue crises while in others it would result merely in an exhaustion of state taxing resources to the detri- ment of the state’s ability to provide other essential health and welfare services.” For all practical purposes, the only recourse of the states would be a quest for relief from the federal government and a resulting reduction in state and local control over local school systems. In each and all of the 49 states fiscal control of expendi- tures beyond the state foundation program is vested in local legislative bodies or school boards. The Serrano- Rodriguez rule would shift control of almost all save minor increments to educational expenditures to state legislative bodies and would result in an enforced fiscal unification of state school systems and drastic restructuring of the 1 Only Hawaii has a school finance system meeting this newly in- vented “imperative”, and that system was not the product of demo- cratic choice but.an inheritance from territorial government. 2 See the testimony of Dr. Charles Benson, Hearings Before the Select Committee on Equal Educational Opportunity, United States Senate, 90th Congress, 2nd Session, at pages 76-79 (1971) (herein- after referred to as ““Mondale Committee Hearings”’). , 3 political institutions and processes of all but one of the fifty states. The undersigned local school districts would be con- fronted in the event of application of the Rodriguez rule with either the need to carry out drastic reductions in edu- cational expenditures, with concurrent wholesale teacher firings, disruptions, and teacher strikes or with a vastly increased tax burden for education wholly unanticipated by municipal officials and residents and ruinous to num- erous property owners, including elderly property own- ers, with fixed incomes. Many of the undersigned states have within their bor- ders large cities with severe urban problems and substan- tial numbers of disadvantaged residents. According to recent studies the interests of most large cities would suffer from application of the Serrano-Rodriguez rule, since most large cities have higher than average tax bases and lower than average tax effort for education in relation to assessed valuation. These states and cities would be hin- dered and impaired in their ability to address urban prob- lems by a constitutional requirement that they devote huge sums of money to elevating rural districts without pressing educational needs or social problems to the spending levels of the “wealthiest” suburbs. See United States Office of Education, Finances of Large-City School Systems: A Com- parative Analysis, D.H.E.W. Publication + OEF7229 ( 1972); Select Committee on Equal Educational Opportunity, United States Senate, The Financial Aspects of Equality of Educational Opportunity and Inequities in School Fi- nance (January 1972), pages 66-73; Hearings Before the Select Committee on Equal Educational Opportunity, United States Senate, 92nd Congress, First Session, part 21, pages 10897, 10905 (Statement of Norman J. Chachkin, NAACP Legal Defense and Educational Fund, Inc., Novem- os 4 ber 30, 1971); Myers, Second Thoughts on the Serrano Case, City: The Magazine of the National Urban Coalition, Vol- ume 5, No. 6, page 38 (Winter 1971); Taylor, The Rich mond Ruling, The Washington Post, January 16, 1972 pages B 1, B 5;3 Bassett, Leaders of Urban Schools Op- pose Dollar-A-Scholar, Baltimore News American, March 16, 1972, page 1, column 4. Each~and all of the undersigned states possesses a re publican form of government within the meaning of Arti- cle Four of the United States Constitution. Each and all * desires to maintain that system of goverment, and opposes transfer of the power of the purse of state legislatures to courts, either their own or those not of their creation. STATEMENT OF THE CASE The decision of the District Court in the Rodriguez case purports to impose as a constitutional imperative the prop- osition, discoverable nowhere in any constitutional provi- sion, congressional debate, or even congressional bill that “the educational opportunities afforded the * * * children of the state of Texas are not made a function of wealth , other than the wealth of the state as a whole, as required by the equal protection clause of the Fourteenth Amend- ment to the United States Constitution.” (Rodriguez v. San Antonio Independent School District, 337 F. Supp. 280 at 286.) This “principle” has been somewhat differently formu- lated by the “constitutional convention” originating it, the meeting of the minds of the authors of Coons, Clune and Sugarman, Private Wealth and Public Education (1969): that a system is invalid which makes “the quality of a child’s education a function of the wealth of his parents and neighbors”. See also Serrano v. Priest, 5 Cal. 3d 584, 487 a in Mondale Committee Hearings, supra, part 21, pp. 10465, 1 ; 4 4 5 P. 2nd 1241.4 The first branch of this formulation, that quality of education should not be a function of parental wealth constitutes a direct threat, not merely to differences among and local’ control in school districts but to private schooling, and indeed all family provided supplements to education. The second branch of this formulation, that seeking constitutionally to divorce educational quality from neighborhood characteristics, constitutes a threat not merely to existing systems of school financing but to the survival of the independent powers of local and, indeed, state governments as well as to rights of free association and migration. These possibilities and dangers are not fanciful. The present school financing litigation is being coordinated throughout the country through the Lawyers Committee for Civil Rights under Law, assisted by the framers of the Serrano thesis, Professor Coons and his colleagues. The Assistant Director of the Lawyers Committee, Mrs. Sarah Carey, has outlined the impending attack on private schools: “(Mrs. Carey) Now if the constitution declares edu- cation to be a fundamental interest it might be you could attack private schools on that ground. (Senator Mondale) The key to the Green case was deliberate segregation, white flight, designed to es- cape the court order. (Mrs. Carey) That is right. (Senator Mondale) You might say that there is a similar constitutional principle, and that no one can escape the public schools. Maybe that will be the law. Go ahead. _ ‘The Serrano court conceded “Plaintiff’s contention — that educa- tion is a fundamental interest which may not be conditioned on wealth — is not supported by any direct authority.” (487 P. 2d at 1255) It reached its conclusion in an opinion replete with quotations from the Coons book. (Mrs. Carey) That is roughly what I wanted to say” (Mondale Committee Hearings at page 6884, Appen- Gix C hereto) (App. 28a). Dr. Coons has also suggested that in light of the fiscal requirements imposed by Serrano: “I think the amount that would already be taken in personal income and other statewide taxes for the general support of education would be enough so that most people would not be able to afford the support of public education and private education. * * * And of course, it is up to the state as to whether they can do that. The state, after all, would set some kind of ade- quate minimum which every child should have avail- able in public education. A district would have to stay in the system.” (Mondale Committee Hearings pages 6883-84, Appendix C hereto) (emphasis added) (App. 27a). Other writers have acknowledged that there is little stop ping place in plaintiffs’ logic short of compulsory state run boarding schools on the early Soviet model. See Kirp, The Poor, The Schools and Equal Protection, in Harvard Educational Review, Equal Educational Opportunity (1969), at 155-56. It is integral to the Serrano-Rodriguez principle that local school districts are to be forceably prevented from spending additional funds on education beyond those authorized by the State.5 5 Professor Coons, in a minor qualification of this, has proposed a system of “power equalizing” which would allow districts to supple- ment state authorized funds from local property taxes provided that rich districts surrendered a portion of the taxes raised for this pur- pose to the poorer districts. He has acknowledged ‘‘of course, there are certain problems inherent in that, not the least of them the political problem of recapture from the local district. I am informed by people who know these things that it is politically difficult to establish a sys- tem in which, if Beverly Hills is to spend $1,000, it may raise $1,500. It is cosmetically bad politically.” (Mondale Hearings (App. 24a) page 6882). Even this largely cosmetic modification of the equal- spending rule has drawn violent criticism from some zealots for ju- 7 The effect of the principle and its allied conception of education as a “fundamental interest” is to proclaim that education is so “fundamental” that parents and local gov- ernments must be prevented from spending their money on it. “The application of this principle to all areas of cori sumption would do away in effect with income differences, destroying the whole system of incentives on which every society is fouxded;’., Coleman, Preface to Coons, Private Wealth and Public Education (1969) at XIV. See Simons, Economic Policy for a Free Society (1948) at 28-29: “A society based on free responsible individuals or families must involve extensive rights of property. The economic responsibilities of families are an essen- tial part of their freedom, and like the inseparable moral responsibility are necessary to moral develop- ment. Family property in the occidental sense of the primary family, moreover, is largely the basis of pre- ventive checks on population and of the effort to in- crease personal capacity from generation to genera- tion, that is, to raise a few children hopefully and well or to sacrifice numbers to quality in family reproduc- tion.” Counsel associated with the committee coordinating the Serrano-Rodriguez litigation have not merely acknowl- edged its relevance for family-provided supplements to education, but also its implications for the remaining other powers of local government. Thus Mrs. Carey has told us that the rule sounds. the doom of the locally collected and locally assessed property tax: dicial intervention in these matters. See Wise, The California Doc- irine, Saturday Review, November 20, 1971, 78 at 82: Michelman, On Protecting the Poor Through the Fourteenth Amendment, 83 Harvard Law Review 7 at 54-59 (1970) ; President’s Commission on School Finance, Schools, People and Money, Final Report (1972) at 33. In light of this, the Serrano-Rodriguez principle realistically viewed, demands full state funding, or at least fully state controlled funding, as a matter of constitutional compulsion. wi 8 “The decision does not invalidate the property tax, but it requires that if that tax is to be retained, the distribution of the income generated by it must be reformed. This probably cannot be done unless the manner in which the tax is collected is also reformed.” (Mondale Committee Hearings at 6867) (App. 1la). Further, once the fundamental objective of the propon- ents of this litigation is achieved — a declaration from the court that education is a “fundamental interest” — a fur- ther wholesale assault on state treasuries will begin:® “And then finally — and this is an issue the press has ignored totally — if education is a fundamental in- terest, as the Serrano court declared it to be, what flows from that? * * * There are a whole lot of things in different directions that flow from the finding of fundamental interests. In other law suits which raise the point directly — which this case didn’t —it may well be that you will find fundamental interest in- terpreted as requiring whatever kinds of support a student needs to exercise that interest the same as a criminal defendant may need counsel. The student may need transportation, he may need lunches, or special instructional aids. Ultimately, five or ten years down the road, there will be cases that flow from the fundamental interest interpretation just as there have been in the voting rights and criminal defense areas.” (Mondale Committee Hearings at page 6868) (Testi- mony of Mrs. Carey) (App. 12a). Still others associated with this litigation have noted that the implications of this case are not confined to edu- cation but extend to all the surviving powers and respon- sibilities of state and local government, and indeed to the ® In Spano v. Board of Education, 328 N.Y.S. 2d 229, 234 (Sup. Ct. Westchester Co. January 17, 1972), the court, in declining to follow the Serrano and Rodrigues cases, perceptively referred to them as “ex- ercises in a forensic ‘game plan’ ”’. 9 federal budgeting process. Thus Professor Coons has ex- pressed the view that the cases render constitutionally vulnerable such programs as the federal impacted area aid program. (Mondale Committee Hearings, at 6848-49). Further, we are told: “Serrano ‘opens a very large door’, says John Silard, a Washington, D. C. attorney involved in school tax litigation. For the first time, he says, the courts are requiring ‘equal protection’ in public programs. They are holding states accountable for how and where they spend public money. In his view, this means ‘a revolution in public services, the schools, he predicts, are merely ‘the first bite at the big apple. Welfare obvi- ously comes next, and I guess health, too.’ * * * Some lawyers predict that if education is accepted as a fun- damental interest, other public services are bound to follow. But they don’t like to Say it out loud. ‘They want this to stick’, one attorney says. ‘You stress that education isn’t like garbage. We are playing a game here. You have to (in order) not to frighten the courts away from a proposition that’s sound.’” An- drews, Tax “Revolution”, Wall Street Journal, March 13, 1972, pages 1, 12. Nor is this all. Professor Coons and his collaborators have included in their book an appendix entitled “The State — Nation analogy to the District — State picture”, suggesting a constitutional obligation to equalize educa- tional spending in all states. Coons, et al., supra at 465-68. Indeed the assumed constitutional requirement of Serrano and Rodriguez of a relationship between benefits and taxes jeopardizes not merely finance systems for various public Services, state and national, but all regressive taxes (the sales tax, the property tax, etc.), all regressive expendi- ture programs (expenditures for national parks and for higher education, for example), and all association of re gressive taxes with regressive expenditures (e.g. use of - — a cigarette tax for purposes of higher education and the catalogue of other examples contained in Mr. Justice Car- dozo’s opinion in Carmichael v. Southern Coal Company, 301 U.S. 495 (1937)). Such are the implications of the principle at issue in this case. 10 STATEMENT OF FACTS In the brief compass of an amici curiae memorandum in support of a jurisdictional statement, a comprehensive statement of the facts of Rodriguez is not in order. A num- ber of features of the case should, however, be noted. 1. The case followed, and in large measure uncritically relied upon, the decisions of the Supreme Court of Cali- fornia in Serrano v. Priest and of Judge Miles Lord in the United States District Court of Minnesota in Van Dusartz v. Hatfield, 334 F. Supp. 870 (D. Minn. 1971). Indeed the Rodriguez opinion is inconsistent with a prior order by one of the members of the Rodriguez court in Guerra v. Smith, (W.D. Tex. No. A-69-CA-9), appeal pending, handed down on July 20, 1971 prior to the Serrano and Van Dusartz cases (Appendix A hereto). The opinion of the California court in Serrano is representative of that court’s unre strained approach to equal protection cases. See West- brook v. Mihaly, 2 Cal. 3d 765, 471 P. 2nd 487, unanimously vacated 403 U.S. 915, invalidating a two-thirds majority requirement for school bond issues.? The opinion rested in T Notwithstanding this unanimous reversal, the California court re lied on its own opinion in Westbrook as precedent for Serrano, 487 P. 2nd at 1249. This court in Gordon v. Lance, 403 U.S. 1 clearly re jected the proposition that educational finance was a fundamental in- terest activating a strict equal protection standard-a proposition urged upon it by the appellees and by the National Education Association 3 amicus curiae in Gordon v. Lance. The pertinence of Gordon v. Lance and of this Court’s decision in the Westbrook case for Serrano-typ litigation has been acknowledged by one of the leaders of the Lawyers Committee for Civil Rights sponsoring the present school financing litigation, Herschel Shanks, Esquire. (See Appendix D, 57a). aa | 11 large measure upon cases and doctrines peculiar to Cali- fornia and was discounted in advance by Professor Coons and other proponents of the Serrano principle. See Coons, Clune and Sugarman, op..cit. supra at 452. The Van Du- sartz case, the first intervention by the federal judiciary in these matters, was decided barely a month after its filing, by a procedure characterized by successful counsel as a ‘nonappealable declaratory judgment’ upon preliminary motion, after thirty minutes of oral argument, upon frag- mentary briefs, on the day of the convening of a special session of the state legislature. Upon this fragile judicial foundation, a vast superstruc- ture of propaganda has been erected in recent months. 2. The Serrano opinion totally failed to cite, and the Van Dusartz opinion cited only to disparage, this Court’s recent and clearly relevant opinions in Dandridge v. Wil- liams, 397 U.S. 471 (1970) and James v. Valtierra, 402 U.S. 137 (1971). The Rodriguez opinion, true to form, failed even to cite either of these cases (to which may now be added Lindsey v. Normet, 40 L.W. 4189). As recognized by the court in Spano v. Board of Education, 328 N.Y‘S. 2d 229 (Sup. Ct. Westchester Co., Jan. 17, 1972), the Ser- rano and Rodriguez decisions misconceived and disre- garded this court’s decisions in McInnis v. Ogilvie, 394 US. 322 (1969) and Burruss v. Wilkerson, 397 U.S. 442 _ (1970) in both of which cases the so-called ‘Serrano prin- ciple’ was urged upon this Court in the briefs of parties and amici curiae, including Professor Coons, and in both of which summary affirmances over dissent resulted. _ 3. None of these opinions cite or even consider the prin- ciples relating to taxation and benefits enunciated by Jus- _ tice Cardozo for this Court in Carmichael v, Southern Coal _ Company, 301 U.S. 395 (1937). 12 4. The Rodriguez court totally failed to consider and discuss the problems of federal jurisdiction presented by the claims asserted before it including the following prob- lems, all related to the refusal of courts to interfere with state taxing and budgetary decisions: a) the problems presented by the Tax Injunction Act, 28 U.S.C. Section 1341, see Samuels v. Mackall, 461 U.S. 41 at 66 (1971); Lynch v. Household Finance Co.. 40 L.W. 4335, 4337 n. 6 (Sup. Ct. March 21, 1972) and av- thorities there cited; b) the problems presented by the fact that the only pecuniary interest at issue was essentially that of state tax- . payers in light of Lynch v. Household Finance Co., 40 L.W. 4335, 4337 n. 6; Abernathy v. Carpenter, 208 F. Supp. 793 (W.D. Mo.), aff'd 373 U.S. 241 (1963); Grey v. Morgan, 371 F. 2d 172 (7th Cir. 1966); Hornbeak v. Hamm, 283 F. Supp. 549 (M.D. Ala. 1967), aff’d 393 U.S. 9 (1968); and the Fifth Circuit’s own decision in Bussie v. Long, 383 F. 2d 766 (5th Cir. 1967); c) the problems presented by the limited scope of 42 U.S.C. Section 1983, see Snowden v. Hughes, 321 US. 1 (1944); Board of Education of Muskogee v. State of Okla- homa, 409 F. 2nd 665 (10th Cir. 1969); McMillan v. Board of Education, 430 F. 2nd 1145 (2nd Cir. 1970) (Friendly J.); Griffin v. Breckenridge, 403 U.S. 88, 102 note 9 (1971): and Adickes v. Kress and Company, 398 U.S. 144, 167 note 39 (1970). See also Emerson, Haber and Dorsen, Political and Civil Rights in the United States, (2nd Edition 1967) at 1435. The substantiality of these jurisdictional questions has been acknowledged even by counsel associated with the Lawyers’ Committee for Civil Rights in a memorandum filed in court as an exhibit by plaintiffs in Milliken v. 13 Green, a school financing case pending in Michigan. (Ap- pendix B hereto). d) Further, the Rodriguez court did not consider the applicability of the abstention doctrine, in light of this court’s clearly revelant decision in Askew v. Hargrave, 401 U.S. 476 (1971);8 e) In addition, the Rodriguez court did not consider the general question of lack of federal equity jurisdiction that the absence of viable remedies presents. See McInnis v, Shapiro, 293 F. Supp. 327, 335-36 (N.D. Ill. 1968) aff'd 394 U.S. 322 (1969); Kurland, Equal Educational Oppor- tunity: The Limits of Constitutional Jurisprudence Unde- fined, 35 U. Chi. L. Rev. 583 at 597-98, 600: and see the Mondale Committee Hearings, Supra at Part 16 B., pages 6747-48. f) Nor were questions of justiciability considered, notwithstanding Gordon v. Lance, 403 U.S. 1, 6 (1971); James v. Valtierra, 402 U.S. 137, 142 (1971) and the McInnis and Burruss cases. 8) Thraddition, there was no diseussion of the appli- cability of the Eleventh Amendment. See Great No. Life Ins. Co. v. Read, 322 U.S. 47, 51-52 (1944); Georgia Ry. Co. v. Redwine, 342 U.S. 299, 304 n. 15 (1952); Employees of Dept. of Public Health v. Dept. of Public Health, 452 F. 2nd 820 (8th Cir. 1971). 5. The procedure followed in determining these grave questions, including the allowance to plaintiffs of leave to file‘a lengthy last minute affidavit containing numerous factual allegations and the disallowance to defendants of * Even Mr. Shanks of the Lawyers’ Committee for Civil Rights has acknowledged that this court’s decision in Askew puts the Rodrigues plaintiffs out of federal court. (Appendix D, infra.,-p.’ 60a). Me 14 an effective opportunity to controvert the affidavit failed to comport with the principles of this court’s decision in Askew v. Hargrave. 6. The delayed injunction entered by the court has a generality and breadth violating the requirements of Rule 65 (d) of the Federal Rules of Civil Procedure, derived from Section 13 of the Clayton Act, providing that any order granting an injunction ‘shall be specific in terms’ and ‘shall describe in reasonable detail * * * the act or acts sought \to be restrained’. See Gunn v. Committee to End the War, 399 U.S. 383, 388-89 (1970); International Longshoremen’s Association v. Philadelphia Marine Trade Association, 389 U.S. 64, 74-76 (1967); Watson v. Buck, 313 U.S. 387 (1941). In addition it should be noted that the de layed injunction ordered defendant state officials to reallo- cate the funds available for financial support of the school system “including without limitation, funds derived from taxation of real property by school districts” notwithstand- ing the fact that the school districts whose funds were being reallocated were not parties to the suit. This element of the court’s order is patently violative of Rule 65. “No court can make a decree which will bind anyone but a party; a court of equity is as much so limited as a court of law; it cannot lawfully enjoin the world at large, no mat- ter how broadly it words its decree. If it assumes to do so, the decree is pro tanto brutum fulmen, and the persons enjoined are free to ignore it. It is not vested with sov- ereign powers to declare conduct unlawful; its jurisdic- tion is limited to those over whom it gets personal service, and who therefore can have their day in court. * * * This is far from being a formal distinction; it goes deep into powers of a court of equity. * * * It is by ignoring such procedural limitations that the injunction of a court of equity may by slow steps be made to realize the worst > 15 fears of those who are jealous of its prerogative.” Alemite Manufacturing Corporation v. Staff, 42 F. 2nd 832 (2nd Cir. 1930) (L. Hand, J.). 7. Subsequent to the rendition of its opinion the Rod- riguez court passed a subsequent order purporting to ex- empt from its dect e payments for debt service. No ra- tionale was tenderea ‘or distinguishing between such pay- ments and other vested obligations such as payments under teacher contracts in “wealthy” districts. ARGUMENT 1, The burden of plaintiffs’ complaint is not that the state has not equalized but rather that it has not equal- ized enough. Insofar as the relief sought is directed against the use by local school districts of the proceeds of local property taxation, the complaint is founded not on state action but upon the failure of the state to correct consequences of differences in private wealth. The very title of the Coons work acknowledges this. The equal pro- tection clause and Section 1983 “was [not] meant to pro- vide a remedy in circumstances where the state had failed to take affirmative action to prevent widespread private discrimination”, nor are these provisions available to rec- tify “the inaction implicit in the failure to enact correc- tive legislation”. Adickes v. Kress and Company, 398 U.S. 144, 167 note 39 (1970). 2. There is nothing unconstitutional about permitting revenues to be spent where they are raised. See the dis- cussion in Muskogee v. Oklahoma, 409 F. 2nd 665 (10th Cir. 1969). 3. There is no classification on the basis of wealth at issue but merely a normal consequence of the division of . — 16 the nation into state and local governments. As a Pro- fessor Emeritus of Public Finance at Princeton has noted: “It comes as quite a shock to be told that the property tax, workhorse of the tax system, is unconstitutional after so many years of reliable service. * * * The ‘rich’ and ‘poor’ municipality must levy different rates of property tax for the support of all other local func- tions, but apparently the disparities of tax rates for these purposes are still constitutional; moreover, every state provides more or less state aid to local schools. * * * Mother Nature is primarily responsible for the differences in real property values * * * topography, location and other natural features result in value dif- ferences that cannot be eliminated. A given millage levy will obviously produce more revenue for a gov- ernmental unit that contains high value property than it will for a unit that contains low value prop- erty. It would be as reasonable to hold that the Rocky Mountains are unconstitutional because they are not flat enough to plow as it is to indict the property tax because a given rate of tax will not produce the same revenue in every district * * * we may not have to wait long before some court will decide that a low income family is denied equal protection of the law because it can buy less than another family with more income. Inequality of personal income would then be unconstitutional.” Lutz, Can the Property Tax be Re- placed? Wall Street Journal, February 9, 1972, page 14. On its face the Texas system of school financing imposes no wealth classifications. Any distinctions which exist re- late not to the wealth of individuals but to the average wealth of subdivisions, average wealth not necessarily co- inciding wth average income because of commercial and industrial property and the fact that persons can be prop- erty-rich and income-poor and vice-versa. The statutes make no distinctions among individuals based upon their wealth. Even if they did they would not be unconstitu- tional in a nation the Fifth and Fourteenth Amendments — 17 to whose constitution protect private property. Education is no more a fundamental interest than health, welfare, police protection, sanitation, or virtually all save the most ephemeral activities of local government. The fact that it is an important governmental function does not warrant the application of a strict standard of review with respect to non-racial distinctions in its finance, unless it is to be supposed even with respect to fiscal matters that legis- latures exist only to decide unimportant questions. Nor does this case involve state-imposed criminal disabilities and deprivations of liberty and procedural due process to which the Fourteenth Amendment is directly addressed or the First Amendment and voting rights questions vital to the survival and functioning of the political process as to which strict judicial scrutiny may be appropriate. The present case is not an effort to protect the political process but to remove one of the most important areas of public policy from political decision making. 4. The decision of the court below rests upon pre- suppositions as to the relationship between educational expenditure and educational quality that are contrary to the best available evidence on the subject. See Coleman, et al., Equality of Educational.Opportunity, (1966) (the so- called “Coleman Report” published pursuant to the terms of the Civil Rights Act of 1964, finding negligible relation- ship between educational cost and educational quality); Central Advisory Council on Education (of Great Britain) Children“and Their Primary Schools (Two volumes 1967) (the so-called Plowden Report also finding no significant relationship between educational accomplishment and edu- cational spending and class size); and see President’s Commission of School Finance, Schools, People and Money, Final Report (1972) at X-XI and 59. (“The relationship between cost and quality in education is exceedingly com- = 18 plex and difficult to document. Despite years of research by educators and economists, reliable generalizations are few and scattered * * * The conviction that class size has an important or even a measurable effect on educational quality cannot be presently supported by evidence.”) In light of such findings Texas and other states have not acted irrationally in declining to appropriate the approximately 8 billion dollars per year necessary to raise all school dis- tricts to the level of the higher districts in each state. Nor have they — or the President’s Message to Congress of March 16, 1972 — been irrational in regarding other social needs, including concentration of additional available funds on truly needy urban districts and such other programs as higher education, welfare, and mass transit as deserving of higher priorities. It is not the function of courts to choose between competing objects of public expenditure or competing educational theories. The effect of the present decisions if generally followed will be to precipitate fiscal crises first for state governments and for presently “wealthier” local districts and second and derivatively for the federal government, and to detract from the ability of all governments to address other pressing social problems. The compelling interests of the state are apparent. 5. Only a brief summary can be given of the other ob- jections to the Draconian decree of the Texas court. The court’s principle that educational differences between sepa- rate governments must be justified by a “compelling in- terest” would lead to efforts constitutionally to compel the national government to relieve interstate differences. It would open to constitutional attack the federal impacted area aid program, among other programs. It would open to attack any disparity in spending between different schools in the same district and result in judicial second- guessing of the detailed administration of local school sys- - 19 tems. It would open to constitutional attack government programs relating to medical care, higher education, police funds, transportation funds and library funds. It would result in a shift in legislative struggles from struggles be- tween subdivisions in a country whose political constitu- encies have been, with good reason, geographically rather than functionally defined, to struggles between program and program and social class and social class. There is no reason to believe that these struggles will be less divisive: rather the contrary. The Rodriguez rule may precipitate a flight to private education in the formerly “wealthy” districts. Local fiscal control of schools will be eliminated or greatly curtailed with resulting implications for educa- tional policy and with resulting increasing use of the schools as instruments for political change.” Great diffi- culty will arise in taking account of variations in local needs and costs. The writings of proponents of judicial intervention indicate that the courts will inflict upon themselves not merely a generation of litigation but liti- gation in perpetuity. Judicial intervention will result in a welter of conflicting legal commands, state, federal and local, and resulting financial crises and school closings. Intervention will result in massive immediate increases in education costs similar to those that have taken place in New Brunswick to the detriment of the state’s capacity to address other problems.!° Any flight to private schools in wealthier districts will decrease the political attractive- ness of increased educational appropriations in the future since the public schools would lose part of their most articulate constituency. The relief sought may result in *See Coleman, The Struggle for Control of Education, in Bowers (ed.), Education and Social Policy: Local Control of Education 64, at 77-78 (1970). **See Advisory Commission on Inter-Governmental Relations, Who Should Pay for Public Schools? (1971), Chapter 1. ee 20 use of non-property taxes and in either substantially lower property taxes resulting in windfalls for commercial and industrial enterprises and land speculators or a possible shift to more regressive sales and value added taxes. The claims rest upon prerrises as to the desirability of educa- tional levelling that are not universally shared, since even the disadvantaged may benefit from the consequences of a measure of educational inequality or the existence of bellwether school districts. The Rodriguez rule would lead to evasions by local subdivisions by transfer of edu- cational functions to other agencies such as library and park boards and/or to a proliferation of the Rodriguez principle as these evasions are pursued. The Rodriguez rule will prevent: introduction of innovations command- ing local but not statewide or national support, as has al- ready begun to happen in New Brunswick, and will in the end result in a reduction in society’s total expenditures for education and in the total investment by the older gen- eration in the education of the younger.!! The underlying principles of Rodriguez cast in jeopardy the entire federal and state budgeting process, and presuppose constitutional limitations on regressive taxes and expenditures and “un- fair” relationships of tax and expenditure that do not exist and have never been held to exist. The principle advanced is inconsistent with the delegation of powers to local gov- ernment and with local home rule and will, if accepted, have consequences for differences in regulatory legislation be- tween home rule subdivisions and differences in the legis- lation of states exercising power delegated to them by 11“The history of education since the industrial revolution shows a continued struggle between two forces; the desire by members of society to have educational opportunity for all children, and the desire of each family to provide the best education it can afford for its own children. Neither of these desires is to be despised, they both iead to investment by the older generation in the younger.” Coleman, Preface to Coons, supra at vii. 21 Congress. The principle advanced will impair the tradi- tion of close fiscal accountability of local boards of educa- tion and will in large cities terminate a process which hitherto has given varying racial and ethnic groups a voice in fisca} control of their educational system. It has hitherto been thought to be an advantage of our system of government that states and localities are not precluded by the absence of a national majority or by the lack of means to carry out reforms on a national scale, from addressing needs that command majority support in their own jurisdictions. Similarly it has been thought to be an advantage of our system of government that local governments may address needs not recognized by a state- wide majority without being open to charges that their greater means or interest constitutes a denial of equal pro- tection of the laws. It has also been thought to be an ad- vantage of our system that private individuals including private individuals of comparatively modest means can spend funds for social purposes not recognized by a ma- jority at even the local level. Plaintiffs’ premises about equality in education are sharply at odds with these prin- ciples, and will make educational change in the future de- pendent upon statewide or even national majorities. 6. As in all the school finance cases decided to date plaintiffs failed to serve with the complaint the real parties in interest in the litigation — those school dis- tricts that would be disadvantaged by adoption of the Serrano-Rodriguez rule. The court did not direct that notice be given to such school districts; in consequence no such districts intervened and the adversary process which would have operated in the event that such districts, or some of them, had been parties to the case did not come into operation, to the detriment of the quality of the record ~~ -_, and the presentation of the case for the present system of school finance. Integral to the relief that plaintiffs pro- pose is the prevention, or at least substantial burdening, of additional local educational expenditures in so-called “wealthier” districts, Integral to it also is an immediate and artifically generated demand for massive public ex- penditures on abstract equalization of rural areas at a time of other more real and pressing social problems. , 22 The Rodriguez decision is a recipe for a society in which political controversies are fought out at ever higher levels for ever higher stakes, by ever more violent. means and in which the safety valves inherent in federal, pluralistic, and limited government will have been constricted to the point of extinction. Reached by processes and in reliance upon case authorities which cannot command considered approval, unsupported by substantial study or reasoning and based upon strongly disputed educational theory, neg- lectful of the jurisdictional limitations which history has imposed upon the powers of federal courts and all courts of equity, it constitutes an interference by the judiciary with the legislative power of the purse running counter to seven centuries of Anglo-American history. It consti- tutes an unparalleled affront to the fundamental principles of government of a nation whose very Declaration of In- dependence contains a remonstrance against a ruler with life tenure who “has combined with others to subject us to a jurisdiction foreign to our constitution and unac- knowledged by our laws; giving his assent to their acts of pretended legislation for imposing taxes on us without our consent”.!2 12 See Hazard, Social Justice Through Civil Justice, 36 U. Chi. L. Rev. 699, 710-11 (1969). 23 CONCLUSION In light of the failure of the Rodriguez opinion to cite or even consider this court’s opinions in Carmichael v. Southern Coal Company, 301 U.S. 495 (1937): Dandridge v. Williams, 397 U.S. 471 (1970); James v. Valtierra, 402 US. 137 (1971); and Samuels v. Mackall, 401 U.S. 41 (1971) and in light of its clear misconstruction of the effect of this court’s summary affirmances in McInnis v. Ogilvie, 394 U.S. 322 (1969) and Burruss v. Wilkerson, 397 U:S. 442 (1970), its failure to give effect to this court’s pertinent decision in Askew v. Hargrave, 401 U.S. 476 (1971), and its failure to discuss applicable jurisdictional limitations, summary reversal, and not merely notation of probable jurisdiction, is in order. United States v. Haley, 358 U.S. 644; United States v. Ohio, 385 U.S. 9. Respectfully submitted, GEORGE W. LIEBMANN, DUKE W. DUNBAR, SHALE D. STILLER, Attorney General of Colorado. Special Counsel for Montgomery ' County, Marytand. ROBERT K. KILLIAN, Attorney General of Connecticut, RICHARD S. McKERNON, F. MICHAEL AHERN, County Attorney for Montgomery : County, Maryland. Assistant Attorney General of Connecticut. FRANCIS B. BURCH, W. ANTHONY PARK, Attorney General of Maryland, Attorney General of Idaho. HENRY R. LORD, Deputy Attorney General JAMES R. HARGIS, a Morvend ey General E. STEPHEN DERBY, Assistant Attorney General THEODORE L. SENDAK, of Maryland. Attorney General of Indiana. GARY K. NELSON, CHARLES M. WELLS, Attorney General of Arizona, Counsel for Bartholomew, Indiana Consolidated School Corpora- JAMES G. BOND, tion, its Trustees and the Seser Assistant Attorney General intendent of Schools of Barthol- of Arizona. omew County, Indiana, HARRY T. ICE, GEORGE B. GAVIT, Special Counsel for Bartholomew, Indiana } Consolidated School Corporation, et al. RICHARD C. TURNER, Attorney General of Iowa, _ GEORGE W. MURRAY, Assistant Attorney General of Iowa. VERNON MILLER, : Attorney General of Kansas, MATTHEW J. DOWD, ED COLLISTER, JOHN JGHNSTON, Assistant Attorneys General of Kansas. ED W. HANCOCK, Attorney General of Kentucky, CARL T. MILLER, Assistant Attorney General of Kentucky. JAMES S. ERWIN, Attorney General of Maine, JOHN W. BENOIT, JR, Deputy Attorney General of Maine. CHARLES F. CLIPPERT, FRED W. FREEMAN, Counsel for Bloomfield Hills, Michigan School District. ROBERT B. WEBSTER, Counsel for Grosse Pointe, Michi- gan Public School System. WARREN SPANNAUS, Attorney General of Minnesota, JOHN M. MASON, Chief Deputy Attorney General of Minnesota, DOUGLAS L. SKOR, Special Assistant Attorne General of Minnesota. ” A. L. SUMMER, Attorney General of Mississippi. 24 JOHN DANFORTH, Attorney General of Missouri, D. BROOK BARTLETT, Assistant Attorney General of Missouri. CLARENCE A. H. MBYER, Attorney General of Nebraska, HAROLD MOSHER, Assistant Attorney General of Nebraska. ROBERT LIST, Attorney General of Nevada, JULIAN C. SMITH, JR., Deputy Attorney General of Nevada. WARREN B. RUDMAN, Attorney General of New Hampshire. GEORGE F. KUGLER, JR., Attorney General of New Jersey, STEPHEN SKILLMAN, Assistant Attorney General of New Jersey. E. P. RIPLEY, General Counsel, New Mexico State Department of Education ROBERT B. MORGAN, Attorney General of North Carolina, BURLEY B. MITCHELL, JR, Assistant Attorney General of North Carolina, HEEGI JOHANNESON, Attorney .General of South Carolina. WILLIAM J. BROWN, Attorney General of Ohio. THOMAS V. MARTIN, Assistant Attorney General . of Ohio. DANIEL R. McLEOD, Attorney General of South Carolina, C. T. GOOLSBY, JR., Deputy Attorney. General of South Carolina, G. LEWIS ARGOE, JR., Assistant Attorney General of South Carolina, GORDON MYDLAND, Attorney General of South Dakota, C. J. KELLY, Assistant Attorney General of South Dakota. DAVID M. PACK, Attorney General of Tennessee, MILTON P. RICE, ie! Attorney General of Tennessee. VERNON B. ROMNEY, Attorney General of Utah, ROBERT B. HANSEN, Deputy Attorney General of Utah. Lee Johnson Attorney General of Oregon Peter s. Herman Senior Counsel, State of Oregon JAMES M. JEFFORDS, Attorney General of Vermont. ANDREW P. MILLER, Attorney General of Virginia. SLADE GORTON, Attorney General of Washington, RICHARD MONTECUCCO, Senior Assistant Attorney General of Washington. CHAUNCEY H. BROWNING, JR., Attorney General of West Virginia, VICTOR A. BARONE, Assistant Attorney General of West Virginia. ROBERT W. WARREN, Attorney General of Wisconsin, BETTY R. BROWN, Assistant Attorney General of Wisconsin. ee la APPENDIX A United States District Court Western District of Texas Austin Division A-69-CA-9 Janell Guerra, et al. Vv. Preston H. Smith, et al. ORDER Plaintiffs, as a class of students and taxpayers, seek a declaratory judgment to the effect that the Texas educa- tional financing scheme is unconstitutional because it vio- lates their constitutional right to equal protection of the laws under the Fourteenth Amendment in two respects: (1) Plaintiffs receive a substantially inferior education _ than do students in many other districts because of a lack of funds; (2) Plaintiffs must pay a substantially higher tax rate because of the low property value in their school dis- trict, while still having less money per pupil to spend. While the extensive exhibits which the Plaintiffs pre- sented at hearing persuasively indicate that the State is not providing substantially equal educational opportunities to all its citizens, this Court can afford no relief. McInnis v. Shapiro, 293 F. Supp. 327, 336 (N.D. Ill. 1968), aff'd sub. nom., McInnis v. Ogilvie, 394 U.S. 322 (1969), held that There is no Constitutional requirement- that public school expenditures be made only on the basis of pupil’s educational needs without regard to the finan- cial strength of local school districts. Nor does the Con- stitution establish the rigid guideline of equal dollar expenditures for each student. 2a This Court considers that binding upon the determination of the instant- action. Accordingly, It Is OrpErED that Defendants’ Motion to Dismiss for failure to state a claim upon which relief can be granted be, and is hereby, GRANTED. The above styled case is DISMISSED. Entered this 20th day of July, 1971, in Austin, Texas. JAcK ROBERTS, United States District Judge. 3a APPENDIX B Lawyers’ Committee For Civil Rights Under Law Suite 520—732 Fifteenth Street, Northwest Washington, D. C. 20005 Phone (202) 628-8730 To: Attorneys Interested in School Finance Litigation From: R. Stephen Browning [initials] Subject: Request for Pleadings Date: October 29, 1971 As of Tuesday, October 26, 1971, I have been notified of the suits listed on the attached sheet. If your suit is not on my list, please notify me at once and send me a copy of your complaint. If your suit is on the list, please check to see that I have all the pleadings. If I don’t, please send me everything I am missing. I am also enclosing a very timely memorandum pre- pared by Michael A. Wolff, the lead counsel for the Min- nesota case. Van Dusartz v. Hatfield. I suspect you may find Mr. Wolff’s conclusions to be helpful in developing your litigation strategy. Hope this is helpful, and please send me at your earliest convenience those pleadings that I lack from your case. RSB: JAB Enclosures (8961 ‘é 4990190 pay) ywrejduio> papuswy psy yp (12/0Z/1) si4aqoy a3pnf Aq saps0 03 dn ay Surpeajd ajajdwios pue (69/gz/] paly) wrejdwo7y (ja13q #441StG] JOOYIS juapuadap. ~ujl Owmojup uvg “a zanbispoy (>) yuMs “2 vssany) (q) 406 pq “2 49141517] 100495 1214) synurejd pue ((7) 6961 Paly) ATuo 3urejdwio> smapuadapul 4140/4 140.4 (&) sexo] (TZ61 ‘i 4990190 ‘Ayuno7 Jajsayr3sa ul puowyrd{y peeyr.p Aq payy) paatecses yurejduiod on é ysOX MIN (02/Z1/Z Paty) Ajuo yurejdwi05 nyo) “2 uosuiqoy = Kassaf Man (1261 ‘ZI 494039Q) uors “Dap 2UuO O}U! Pajepljosuods — pay sjyurejdwiod so1y 7, Playfjop] 2 zyavsnq uv 4 PyOsouUIPL “~ (12/51/01 paly) Ajuo qureydw0 uaasy) “a uayyny (4) uvbiy np fo a3p15 (39/61/9 pay) Ajuo yurejduso> ‘a uoyvmnpy fo pavog nosjaq (8) uesiyr1W (1261 ‘I 4940990 pay) Ajuo yurejdiwo07> japunpy “a 4a440g puejArey (1Z61 ‘4 49q039CQ pa[y) Paatesas yurejduso> oN é eueipuy (1261 é 4940190 party) ATuo yurejdus07> Stour] {0 31015 ‘a os0g4v2¢ (q) (1261 “é 4equiaydas pajy) Ajuo yurejduso> ssoung] fo aris ‘a asvjg (e) siourl]] (12/¢/6 Paty) Ajuo yurejdwoy 04910) “2 uaqiV Opesojoy UOISIDap ye IsN3ny 394} Zurpusue uorwido sno suresd “NG eIUJO;ITED) 1990190 3da0xe ‘ay sBurpeayd aj3ajdui07> ISA ‘2 OUDLLIS erusojlyey | . (12/21/01 Paty) Aquo ywrejdusoy irisfoys ‘a sburyjory euozy uoudoy asv7 aun NT 37015 291jmumoy ssakmoy 2yj 30 any uo shurpoajg 5a Law Offices 20 West Sixth Street Legal Assistance St. Paul, Minnesota 55102 of Ramsey County, Inc. 612-227-7858 JouN E. BRAUCH October 21, 1971 GENE T. ECKER MICHAEL F.. PeTscH RIcHARD H. BENEDICT Rocer S. Haypock Dotores C. OreEyY REED C. RICHARDS MicHAEL A. WoLFF Epwarp W. BEARSE Rosert M, Spector RicHarD A, KAPLAN Mark REINHARDT Mr. R. Stephen Browning Lawyers Committee for Civil Rights Suite 520, 733 15th St. N.W. Washington, D.C. 20005 Dear Steve: Following Jack Coons’ suggestion, more or less, I have done some inquiry and research concerning school-financing cases in federal court. I conferred with Professor David Louisell, a Berkeley colleague of Jack’s who is visiting pro- fessor at the University of Minnesota Law School, and read some cases and textual materials. I apologize that I have not the time to write this as a thorough memorandum of law; however, in this letter I shall try to outline briefly the points of law involved, tactical considerations, etc., with the hope that such information will be useful to other lawyers who have brought or plan to bring their school- financing cases in federal court. The answers given here are by no means final; the points conveyed here should be used as a starting point for lawyers’ research. 1, Jurisdiction. In our case, Van Dusartz v. Hatfield (D. Minn., Oct. 12, 1971), the plaintiff schoolchildren’s cause of action arises under the Civil Rights Act, 42 U.S.C. 1983, in “= 6a that the schoolchildren in poor districts are deprived of equal protection guaranteed by the 14th Amendment by the fact that educational expenditures, and thus quality of edu- cation, were lower because of their districts’ inability to raise greater sums of money from local property taxes. Jur- isdiction in such 1983 actions is based on 28 U.S.C. 1343 _ (3) and (4). The legal theory, propounded by the Court in Serrano and accepted by the Court in Van Dusartz, is that education is a fundamental right and that classification on the basis of wealth is constitutionally suspect. We believe that in federal court actions, the only viable cause of action is the above-described schoolchildren’s cause of action. Taxpayers, parents, school districts, local gov- ernments, etc., would have great difficulty invoking juris- diction. Section 1983 and the 14th Amendment do not seem to reach such purely fiscal problems. Nor does 28 U.S.C. 1331, the general federal question statute, confer jurisdic- tion both because of the 14th Amendment-reach problem and because, as to individual taxpayers, the amount-in- controversy problem. 2. The McInnis Problem. McInnis v. Shapiro, 293 F. Supp. 327 (N.D. Ill. 1968), aff’d sub nom. McInnis v. Oglivie (394 U.S. 322 (1969) and Burress v. Wilkerson, 310 F.Supp. 572 (W.D.Va. 1969) aff'd nom. 397 U.S. 74 (1970) preclude cases brought that are based upon the educational needs of the children. This problem is discussed at great length elsewhere (Coons et al., Private Wealth and Public Educa- tion). However, it needs to be emphasized that, despite the fact that the U.S. District Court in Van Dusartz ably dis- tinguished McInnis and Burress, the greatest danger to cases brought in federal courts is that the courts will con- sider McInnis and Burress to be binding precedent. Not every court will be willing, as the Minnesota federal court was, to draw the kind of fine line needed to distinguish McInnis and Burress. For that reason alone, these cases generally should be kept in state courts. 3. The Abstention Problem. In Askew v. Hargrave, 401 U.S. 476 (1971), the Supreme Court indicated that the ab- _ : Ta stention doctrine might apply to cases in this area. If there is an action pending in state court which would obviate the need for consideration of federal claims in federal court, the Supreme Court indicated that the U. S. District Court might very well abstain. The language of the Court in Hargrave should give pause to those who would bring their actions in federal court. For one thing, if a complaint bases its claims alternatively or primarily on grounds involving state laws or constitution, a federal court might abstain until the state courts have ruled on such issues. Basing a plaintiff’s complaint, as we did in Van Dusartz, solely on the claim of deprivation of civil rights in the denial of equal protection might protect against federal court abstention, but there is no assurance that it will. See Reetz v. Bozanich, 397 U.S. 82 (4970): Wisconsin v. Con- stantineau, 400 U.S. 433 (1971), McNeese v. Board of Edu- cation, 373 U.S. 668 (1963) and Monroe v. Pape, 365 U.S. 167 (1961). 4. Declaratory Relief Only. In Van Dusartz, we asked only for a declaratory judgment declaring that the consti- tutional rights of the plaintiff schoolchildren are being vio- lated by the state’s system of school financing. By doing this, we avoid a three-judge court. The case law is nearly unanimous that where only declaratory relief is sought, a three-judge court cannot be convened. Fremed v. Johnson, 311 F. Supp. 1116 (D.C. Colo. 1970, three-judge court) at p. 1118, footnote 7 summarizes the cases on point. See also Mitchell v. Donovan, 398 U.S. 427 (1970), where the Su- preme Court said that denial of a declaratory judgment was not the same as denial of injunction under 28 U.S.C. 1253 which permits direct appeal to the Supreme Court. There are two clear advantages to this approach: 1.) If relief is denied, appeal is to the Court of Appeals. Thus, we avoid repeating the disastrous result of a summary affirmance as in McInnis. 2.) Declaratory relief arguably is a much more modest request than to ask a federal court to enjoin the operation of a myriad of statutes and to com- pel the Legislature to establish a non-discriminatory sys- 8a tem. The latter request would seem to many courts to be nonjusticiable, as the courts for many years considered reapportionment cases. The objection can be raised, of course, as to what happens if the Legislature refuses or fails to heed the declaratory judgment of the federal court. We believe the appropriate time to be concerned about this is when it happens: In other words, plaintiffs are in a much better position after a declaratory judgment has been entered to move to amend their complaint and seek a three-judge court to enjoin the statutes. To move at the outset for a three-judge court to make sweeping changes in the financing system is to ask the court to bite off more than it probably feels it can chew. 5. A Motion to Dismiss. As the Van Dusartz case indi- cates, probably the best thing that can happen to your law- suit is for the defendants to move to dismiss for failure to state a cause of action. Then the claims of the plaintiffs are in roughly the same posture as in Serrano which arose on a demurrer. In Van Dusartz, Judge Lord assumed the truth of plaintiffs’ allegations in testing the cause of action. Thus he in effect said that if plaintiffs’ allegations are true, the financing system is unconstitutional. What the Judge really has done is issue a “declaratory judgment” that is nonappealable. His opinion came at a time when the Legislature was meeting to consider school financing. The opinion sets forth a constitutional standard that must be followed. This advice is given in a memo- randum and order denying a motion to dismiss; from this order, no appeal can be taken without the court’s approval. See Moore’s Federal Practice, Para. 12.14n.16. If the Legis- lature satisfies the standard set forth, the litigation will be ended without any appeal because of mootness. Whether this result can be reached is uncertain but it clearly is worth a try. 6. A Nonappealable Declaratory Judgment? In drafting our complaint, we tried another device that we hoped might avoid an appeal if declaratory relief were granted to us. In our prayer for relief, we asked the court merely 9a to enter an order declaring that the system violated the constitutional rights of the plaintiffs and retaining jurisdic- tion of the case until the Legislature responds to such declaration in order to determine what further relief (i.e. convening of a three-judge court would be appropriate. However, such retention of jurisdiction would not be effec- tive to deprive the defendants of their right to appeal; the declaratory judgment statute (28 U.S.C. 2201) clearly states that “any such declaration shall have the force and effect of a final judgment or decree and shall be reviewable as such.” Clearly, to proceed in this manner in order to avoid appellate review is fruitless. As I said at the outset, this letter is not intended to pro- vide definitive answers to the problems facing litigants in federal court; it may, however, be used as a starting point for lawyers’ research. In that regard, I hope these thoughts will be helpful. Very truly yours, MiIcHaEL A. WOLFF, Attorney at Law. MAW:bme ec: Prof. John E. Coons Prof. David Louisell 10a APPENDIX C ( 6866 ) STATEMENT OF Mrs. SARAH CAREY, ASSISTANT DIRECTOR, LAWYERS COMMITTEE FOR CIvIL RIGHTS UNDER LAw (Mrs. Carey) Thank you. My point of view in discussing the Serrano decision is that of an organization that has been coordinating and stimulating similar kinds of law- suits around the country, and in many cases being involved in litigation ourselves. I think at the outset I should state that the impact of Serrano has been absolute'y phenomenal. In a way that far exceeds the limited nature of the decision. It is, as the professors have pointed out, a decision of the California Supreme Court, not the U.S. Supreme Court. It will ap- ply to California only if it passes a whole series of remain- ing judicial proceedings. Yet, despite these various restrictions, it has had at least as much impact, if not more, than a number of the major U.S. Supreme Court decisions in past years. I think, trying to explain the reaction — you have touched on it earlier, Senator — that the whole spirit of this Nation has been that (6867) we are committed to a universal, equal form of education that helps all children, poor or rich. And then, suddenly we find out through this decision and the resultant publicity that, in fact, we are not doing that; we are providing education resources very much along class lines and discriminating against those*who need it the most. That is just a preface. The Serrano decision..has been a real mindblower in terms of the issues it has raised and the activity it has pro- voked, legislative and legal. Similar Suits Filed in 26 States At our latest count, we figured that something like 43 attorneys in 26 States have either filed or are planning to a file similar kinds of lawsuits. There is a great danger, as Professor Coons has mentioned, that some of these suits will not be adequately prepared and could prejudice the consideration of the issues by the Supreme Court. lla (Senator Mondale) There is a conference scheduled on October 16. (Mrs. Carey) That is a conference the lawyers commit- tee is sponsoring, and we are trying to pull together— (Senator Mondale) In Washington. (Mrs. Carey) That is right. But, as you probably know, lawyers are difficult to control. They hide behind their clients. (Senator Mondale) I was once a lawyer myself. (Mr. Carey) I would like to point out that our feeling is that the Serrano case has raised more questions than it has answered. It is very exciting in that respect, in terms’ of ushering in an era of reform that will challenge the educa- tional establishment. Many of the questions that it raises are touched upon by the other suits that are now pending. I would like to just briefly summarize these questions, and then run through the three major categories of lawsuits that are now pend- ing, so you have an idea of some of the issues being pre- sented. Three Major Questions Raised Serrano set a negative standard. It did not say what the State had to do. It just said what it could not do; and, in so doing, it raised a number of very complicated questions, including what ought to be done about the property tax. The decision does not invalidate the property tax, but it requires that if that tax is to be retained, the distribution of the income generated by it must be reformed. This prob- ably cannot be done unless the manner in which the tax is collected is also reformed. 12a The second major question is: Should school districts be redrawn? The Serrano decision indicates that as long as the inequalities in resource allocation among districts are cor- rected, there is no need to alter present district boundaries. (Senator Mondale) It could well be that that judgment, if sustained, would have a bearing politically in the long run about_how school district lines are drawn. (Mrs. Carey) That is right. In a number of cases now pending, the plaintiffs request redistricting as a means of sharing the wealth among various units of government. The third one is — well, I guess, Professor Yudof has really taken care of this issue — how can intradistrict dis- crimination be prevented, once (6868) the money gets handed down by the State, assuming the State corrects its allocation pattern? And then finally — and this is an issue the press has ignored totally — if education is a fundamental interest, as the Serrano court declared it to be, what flows from that? In the criminal area, where the right to an adequate de- fense, has been declared a fundamental right, the Supreme Court has held that the State has to put the defendant in a position where he can actually fully exercise that right. This has been translated to mean if he is poorshe must be furnished defense counsel; his trial transcript must be paid for; and he must be given other support to put him in an equal position with more well-to-do citizens. Serrano Decision Deals with Fiscal Equity (Senator Mondale) As I understand Dr. Coons’ interpre- tation of the Serrano case, the court specifically was not asked to deal with the question of need; they were asked to deal with the question of what he calls “fiscal equity.” So in no way does that deal with the need question. But there have been two cases, in Virginia and Illinois which sought to deal with the fairness principle, the need princi- ple and both were lost. a 13a (Mr. Carey) I am getting at it from a different way. The Serrano decision did declare education to be a fundamental - interest, and it said, as a result of that, we have to do cer- tain things with the way we spend money for education, But there are a whole lot of things in different directions that flow from the finding of fundamental interest. In other lawsuits which raise the point directly — which this case didn’t — it may well be that you will find funda- mental interest interpreted as requiring whatever kinds of support a student needs to exercise that interest, the same way a criminal defendant may need counsel. The student may need transportation, he may need lunches, or special instructional aids. (Senator Mondale) I understood Dr. Coons to say he hopes no one would bring a lawsuit of that kind now. Did I understand you correctly? (Dr. Coons) Yes, sir. (Mrs. Carey) Dr. Coons does not want to have Serrano fouled up on its way to the Supreme Court. (Senator Mondale) That is going to be quite a conference in October. (Mrs. Carey) Ultimately, 5 or 10 years down the road, there will be cases that flow from the fundamental interest interpretation just as there have been in the voting rights and criminal defense areas. To get a little more specific on these questions, I would like to outline the kinds of cases that are now pending. Questions on Property Tax In the property tax area, there are a number of suits. a whole line of new law, that in effect are challenging the way jurisdictions assess and administrate their property taxes. As you probably know, nationwide around half of school funds are funded through the property tax. The tax generates $33 billion, which makes it second only to the Federal income tax and the Social Security Tax. And oe ee l4a yet, the (6869) manner in which it is administered in most states is an outrage. It is steeped in corruption and subject to tremendous political abuse. Even though State constitutions generally define the level of required assessment, this varies tremendously locally, so even though a State may require in its consti- tution assessment at full market value, the local assessors will be assessing anywhere from 5 to 10, to 25 percent of value. Many States — and Illinois, Indiana, and Wisconsin are among the worst — have such a proliferation of assessing districts, with elected assessors who are untrained and un- scrutinized and unreviewed by State agencies that they are literally tied into the local political system which ne- gates effective assessment. Further, the number of tax exemptions granted have gone way out of control. In Boston and in other major cities where the exempt private and public property cuts severely into potential tax bases — the loss that results from this maladminis- tration of property taxes hits the schools the hardest, al- though it affects other local services. _ The National League of Cities and the U.S. Conference of Mayors has estimated that maladministration of the property tax costs the cities between 30 and 50 percent of their total potential revenues. This could mean that — in a city like Newark, the loss through the city’s failure to administer the property tax properly is greater than the funds it gets through Title I, ESEA. So the Federal program, in effect, is merely mak- ing a dent in the misfeasance of local officials. In regard to the cases that are pending, there is a major case in Texas involving as plaintiffs the school districts of Fort Worth,. Dallas, and Houston. These school districts are claiming that the manner in which Texas assesses taxes is so divergent, from district to district, that they are being assessed at three or four times the amount of neighboring districts — which are being assessed below the statutory 15a level. That, since the State contribution to the local schools depends on the value of the property assessment in the dis- trict, they are getting hit on the other end, too. More is being taken from them and less being given back as a re- sult of the way their properties are being assessed. They also claim that the tax exemptions from State and Federal buildings in their jurisdictions — and these are facilities which benefit the State as a whole and not just the locality — also cut unfairly into their revenues and discriminate against them by imposing a higher tax bur- den. The Fort Worth case is before a three-judge Federal court in Texas and has survived a motion to dismiss; pre- sumably it will be decided sometime this fall. It points up very directly the second phase of the Serrano effort. A State may take the step that California appears to be taking, of cleaning up the manner in which it distributes its revenues once they have been collected, but, unless it also cleans up the way in which the revenues are collected, it will be hit by a second equal protection suit down the road. This summer in June a Federal court in Alabama con- sidered a similar issue. Schoolchildren in that case claimed that inequities in the administration of the property tax — from 6 percent of market value to 26 percent of market value — deprived them of much needed resources for their school. In other words, because the State assessors were not following the statutory level of 100 percent, they were, in (6870) effect, cutting into the school budget by several million dollars. This was the first case to hold that under the Federal Constitution that kind of diver- gence in the administration of property tax violates both the due process and the equal protection clauses. The property tax reform effort is a movement that must be watched. It is really another part of the kind of thing Serrano is trying to accomplish. 16a Questions on Effects of Revenue Sharing I think without going into it too specifically that there is clearly a Federal role in this area. If the Federal Gov- ernment is going to accept some form of revenue sharing, then the funds generated under that program should not be handed out unless the States are willing to clean up their own tax mess, and, in effect, reform the property tax and other laws that generate taxes. As I understand’ it, neither S. 1669 or H.R. 7796, the special revenue-sharing bills for education, includes any such provisions at present. Suits Seeking Redistricting A second line of cases, which is of tremendous relevance to where we go in education and what happens with school finances, are the suits that are seeking redistricting. These suits have two goals. Some of them have a fiscal goal. The plaintiffs are asking that their school district be merged with a richer neighboring district in order to share the wealth. These suits have a second goal sometimes, the separate, distinct goal of seeking desegregation of what have become racially segregated districts. While Serrano promises to eliminate economic distinc- tions betwen rich and poor districts, this line of cases seeks to redraw district lines altogether, so you can merge rich white communities with poor minority communities. As far as school reform movement is concerned, it seems clear these suits can only provide a tenfporary form of relief: sooner or later there is going to have to be an overhaul of the State laws to provide for a greater State contribution. But in the short run the suits may help integrate the poorer school districts with their richer neighbors and get some additional funding into them. To touch on the cases briefly, one of them is pending in Federal court in Texas: Rodriguez v. San Antonio Inde- pendent School District. In the San Antonio area, the school districts have been drawn with great skill so the 17a Chicanos are in one area and the whites are in another. The suit alleges that the higher the white population, the more money available. They are asking for alternative relief, either a correction of the fiscal distribution at the State level, or redistricting so that the Edgewood School District, in which the plaintiffs live, would be merged with a nearby richer district. (Senator Mondale) I think they have something like 12 school districts within the city of San Antonio, each sepa- rately funded. And, in addition, the city fathers put all the public housing in the Edgewood School District. They are located next to an Air Force base. The children all go by Edgewood, they go somewhere else with their impact aid. The superintendent of Edgewood testified before us. (Mrs. Carey) The San Antonio case is probably one of the worst ones. But it is clear the power to develop school districts has been greatly (6871) abused, in the same way zoning laws have been exercised to exclude poverty sec- tors or predominantly minority sectors. . A second case that is presently pending is the one in Richmond, Va., which I am sure everyone has read about. This is a case that follows an initial order from a Federal court ordering the city of Richmond to desegregate its schools. The plaintiffs cme back a few years later and said, “Court, we cannot desegregate; the only way we can effectively integrate is by merging with the counties.” The courts brought in the surrounding counties as defendants and is presently considering a metropolitan redistricting scheme. The Richmond case alleged both racial discrimi- nation and the discriminatory exercise of State districting powers which. resulted in the distribution of school re- sources of an unequal basis. There are several similar suits, one in New Jersey, Robinson v. Cahill. ° . There is one pending in Hartford, Conn., Lumpkin v. Dempsey; where the city of Hartford is claiming the only way you can integrate education is by reaching into the surrounding counties. 18a In Wilmington, Del., and Grand Rapids, Mich., there are suits similar to the Richmond suit, where an initial de- segregation order was granted, and the plaintiffs came back for further relief, saying it is impossible to desegre- gate unless we join the surrounding areas as defendants. (Senator Mondale) Do you think those cases are likely to be successful, in the absence of evidence of discrimina- tion and segregation in the development of the lines them- selves? (Mrs. Carey) That is the issue that is being litigated, whether or not there was discrimination in the drawing of those lines. Of course, the Detroit case, from what the press says — which may or may not be accurate — seemed to find there was State action in the zoning practices and the way that resources were allocated. (Senator Mondale) Within the district? Metropolitan Desegregation Cases (Mrs. Carey) Within the city. But also suggesting the only way — the State has the power in the entire metro- politan area, naturally, since it controls cities and can take away their powers and give them additional power. But that court seemed to be saying that the State is responsi- ble because the situation resulted from the delegation of its zoning and financing powers. The metropolitan desegregation cases, which are also growing in number very rapidly, raise important questions that relate to Serrano. Among these are — and these are questions, I think, the committee should consider — have the States overdele- gated their districting powers in such a manner as to be- come unwitting accomplices to local discrimination? Can the districting mess be cleared up by a simple reallocation of resources? Will the Serrano principle, with its elimina- tion of economic distinctions between districts encourage in areas of de facto racial segregation a system of separate but equal schools, in effect ignoring the principles enunci- : 19a ated 15 years ago in Brown v. Board of Education? Can the schools be equal if they are racially segregated? And, finally, will the remedies fashioned on the basis of Serrano include integrated classrooms as part of the definition of “equalization of resources”? (6872) These are all questions way down the road. But, in the two lines of cases, each take care of only part of the problems. Serrano really does only get at the fiscal problem, and the metropolitan desegregation ones get at the racial issues. It would seem, unless the two are combined in some manner, we are not going to fulfill our constitutional principles. Some of the language in the first Hobson decision, I think, illustrates the problem that Serrano could lead to, of separate but equal schools where you would make fund- ing, the allocation of funding sufficiently equal to meet the constitutional standard, and yet the communities would still remain segregated. other about to be filed in New York. Intracity discrimi- nation is, again, a pattern across the country. These cases all reflect very real personal situations Relationship of Wealth to Educational Achievement There are, among the post-Serren: cases cases that are going a bit further in teres of es-ime adhditional related issues. The case filed initia. » “etre? School —_ - & about to be reinstituted — attempted te deal with one of the questions raised by Serreme. which is the relation- ship, if any, that wealth has to actual educational achieve- ment. I think many of the journalists raised this question. If you keep on increasing the money, can you 20a a difference in education? Aren’t these children so dis- advantaged that pouring more money isn’t going to make any difference? Well, the Detroit case tries — through a massive study based on Michigan school data — to show that there are » very direct correlations between the resources provided to a school, the background of the children, and educational achievement. There are figures showing that educational achievement does at least correlate with the money in- vested. And, finally, the study shows the relationship of all of this to career opportunities. As we understand it, this case is going to attempt to bring to proof— (Senator Mondale) Where is that case? Did I under- stand from your testimony that the plaintiff’s case in Michi- gan was dropped? (Mrs. Carey) It was dismissed for lack of prosecution, but it is going to be reinstated. (Senator Mondale) This is the Urban Coalition case?, (Mrs. Carey) It is the case for which the Urban Coali- tion did a study. (Senator Mondale) Yes, I read the study. I thought it was going forward. I was surprised to hear it had been dropped. (Mrs. Carey) Detroit got so involved in other issues that the school board did not pursue it. But these suits are going to be moving into some of these areas of proof that raise still more questions. Based on this background, I would like to suggest a number of actions that the Federal Government should consider. (6873) There is, from our point of view, a tremendous need of research and hard data on which to base the vari- ous remedies that are being recommended. Such questions as the cost of municipal overburden, the differentials be tween city and suburban areas, are not too difficult to an- a : 2la swer. The ACIR has taken care of a lot of that. But there are very basic questions about the real costs of educating children that nobody knows about, and perhaps if the Office of Education could develop a 5- or 10-year research plan that could direct itself to this problem, it would help the results of these cases. (Senator Mondale) I agree that we ought to have a much better and more sophisticated program of research and experimentation. But I think, if we have a 10-year plan, the Congress would await the results of that study before it helped schoolchildren. There would be one more generation down the drain. Need Long-Term Commitment (Mrs. Carey) Some form of long-term commitment. The performance contracts, for example, that some cities are turning to really should be watched closely from the Fed- eral level so that other States can benefit from them if they actually work. (Senator Mondale) I agree with you. (Mrs. Carey) The present measurements are also focused so much on the speed, on the efficiency with which the child is moved, through the system rather than the ) end result, the learning. As I think has been touched upon by the professors, I think that a lot of things ought to be done about Title I. If the Serrano movement really takes fire and the legis- lative renaissance that Professor Coons has predicted takes place, there is clearly going to be a gap period be- tween the time when the States assume their responsi- bilities and the present. During that time Title I really should be used to help make up the differences in the needs of poor students in the inner city: Beyond that, if the States do really correct their financ- ing schemes, Title I should probably be used as a source of funds for continuing experimentation with regard to the educational needs of the poor. 22a An additional action that we have kicked around that might be useful at some point — would be some kind of special Federal legislation that would give individuals the right to serve as enforcement tools in seeing that the States comply with the equal allocation of resources requirement. We felt perhaps something along the lines of the Voting Rights Act, that would put in the office of the Attorney General and in the hands of private individuals a right to enforce compliance with the constitutional standards established by Serrano. I think that is quite a way down the road, but those kinds of enforcement efforts, where you allow private individuals to do what the Federal Gov- ernment may not do, even though it is its duty, are really tremendously helpful in moving in this kind of area. One final comment. We have found in following these suits that many of them are outrageously expensive. Re- form litigation, particularly litigation that is massive, can be extraordinarily expensive. Legislative action is far more efficient, less patchwork, and really can do the job faster. (6874) Just to give you a specific example, the suit that was brought in the District of Columbia to enforce the initial decision in the Hobson case, that is, the followup suit, has cost, if you include attorneys’ fees, somewhere around $200,000 to $300,000 for the appellants alone. So that is something that must be kept in mind. Marvelous as the constitutional issues are for lawyers, they are al- most prohibitively expensive. [Written Prepared Statement Omitted] (6881) (Senator Mondale) Thank you very much for a most useful statement. We will take about a 10-minute break here, and then I have some other questions. (Recess. ) (Senator Mondale) Dr. Coons, in your statement you set forth a formula that you think might be used, for ex- ample, in California, based on the Serrano principle. On pe : pages 7 and 8, you have an example of how California might respond to the Serrano rule and equalize the finan- cial power of each school district. Would you describe that for the record, if you will? (Dr. Coons) Basically, the idea is to provide each dis- trict with the same opportunity and capacity to spend so that, irrespective of whether districts were par in tax- able wealth, that the tax rate locally chosen would have the same effect as it would everywhere else in the State. For example, if the poorest district in the State were to tax itself at 33 mills, hypothetically, and the richest district were to tax itself 33 mills on its local property, that each would have the same number of dollars per pupil to spend. It could be thought of rather simply, as a table of equiva- lents. The legislature might enact a table of equivalents in which the left side is a column of permissible tax levies, locally chosen by the local board ranging, let’s say, from a minimum of $600 or $700 up to a maximum of, say $1,800. For each amount that the district might choose to spend on its students, there would be an appropriate local tax levy. Let’s say that for 2 percent a district would be per- mitted to spend $1,000 per pupil. If the 2-percent levy did not raise that much locally, that district would then be subsidized to the extent of the difference. If it raised more in a rich district, the excess over $1,000 would be redis- tributed to pay for the poorer districts. (Senator Mondale) So, under that formula, the poorer the district, the more subsidy; the richer the district, per- haps the greater it would subsidize others? Equality of School District’s Effort (6882) (Dr. Coons) That is correct. “But, in any event, for each and every tax rate, the same spending would be permitted so that there would be an equality of sacrifice among the districts for any given level of expenditure. If you want to spend more, you have to try harder. That is the ethical principle that is involved. 24a (Senator Mondale) So, the political effect would be that a poor district could not go out and campaign for a higher effort, since there will be a nice bundle of State money coming in to match the district’s effort, because its valua- tion is so low that even though it tries, it cannot obtain adequate funds from local sources. The State will make up the difference between the $400, say, it raises per capita and the $1,400 developed in the State formula. The dis- trict will get $1,000 per head from the State government. (Dr. Coons) Exactly. (Senator Mondale) But there is just the reverse incen- tive, however, for the rich district. Are the politicians there going to say, “Let’s try harder so more of our money will go somewhere else.” And how is that going to work? (Dr. Coons) We have no idea. (Senator Mondale) How would you like to try it? (Dr. Coons) I would like very much to. It seems to me, looking at today’s pattern of spending, Senator, we see poorer districts trying much harder than rich districts. We see them willing to tax themselves to the bone in order to support spending at one-third of one fourth of the level of the rich districts. Rich districts are in the habit of saying, “Look how much we care about education; we spent so much here.” It would be interesting to find out whether they really do care and are willing to tax themselves at the same rate as the poor districts for that same level of expenditure. Of course, there are certain problems inherent in that, not the least of them the political problem of recapture from the local district. I am informed by people who know these things that it is politically difficult to establish a system in which, if Beverly Hills is to spend $1,000, it may raise $1,500. It is cosmetically bad politically. (Senator Mondale) You would get a big meeting the night you proposed that. _ 25a (Dr. Coons) Right. There are, however, ways to dimin- ish this highly visible redistribution. One of them is first to remove industrial and commercial property from the local tax base — a form of legislation which has been frequently suggested, anyway, and one which is inherently rational. Tax Industry/Commerce Statewide That is to say, take a statewide tax of 3 or 4 percent and apply it to all industrial and commercial property. The local levy then would only be on residential property. And the range of wealth among districts would have been squeezed to such a narrow spectrum, compared to the pres- ent spectrum, that there would be no problem of recap- ture. (6883) If you took all the industrial and commercial _ wealth out of Beverly Hills and the other rich districts in California, the range of local residential wealth per pupil would be sufficiently narrow that you could operate the kind of system that I outlined in my testimony, without having to take any money away from Beverly Hills. That, it seems to me, would be a highly desirable political z apparatus. (Senator Mondale) In the absence of some kind of ad- justment, in the rich district, would you not actually be encouraging private schools for the rich? Would they not say, “Well, we are in this trap where we can raise a lot of money to be sent elsewhere, or we can put downward pressure on revenue for our local schools and simply spend all of our money on private schools for our chili- dren.” Since all the capital costs of constructing private schools is deductible from the taxes anyway, it is sort of publicly supported. In other words, I am trying to think how the incentives of your program would work. I see the one point you make. 26a Would not a statewide income tax make more sense than trying to depend principally upon the real estate tax or some other form? (Dr. Coons) Let me say this, that a statewide income tax could certainly be employed either in a centralized or a decentralized manner to provide the necessary funds. There is no question about that. If you are asking, in a decentralized model, should a local income tax be preferred over local property tax, the answer is likewise “Yes,” in my view. Because it seems to me that the income tax— (Senator Mondale) I am talking about a statewide in- come tax. (Dr. Coons) You could have both, as a matter of fact. No reason you could not have both. (Senator Mondale) The income tax has additior.al ad- vantages. I think it is a better reflection of wealth than a property tax. Prefers Local Income Tax (Dr. Coons) At least as the property tax is presently structured, there is no question, and that is why we would prefer a local income tax. May I answer that other question which you had before about the rich district and its disincentives? It is an im- portant question. It depends entirely upon the formula adopted. That is to say, if the relationship between spending and tax is carefully adjusted, and, if industrial and commercial are removed from the local tax base so as to squeeze the wealth spectrum down, it is my judgment that there is | no stage at which you would have a powerful incentive for rich districts to opt out of the system. But I think the amount that would already be taken out in personal in- come and other statewide taxes for the general support of education would be enough so that most people would 27a ‘ not be able to afford both the support of public education and private education. At least there would not be a suffi- cient number of such people that there would be any but a fringe of districts in which the demography would be such that there would be so many very rich people that they would opt out of public education altogether. And, of course, it is up to the State as to whether they can do that. The State, after all, would set some kind of adequate minimum which every child should have avail- able in public education. A district could (6884) simply drop out, as it were; it would have to stay in the system. Being in and paying for that system, people are going to use it — they are going to have to carry the burden of that local system, and so, there is a powerful incentive to stay in it and make it all work as a public system. Was I responsive? (Senator Mondale) Yes. Would either of the other two witnesses care to respond to this question of what the States should do if the Ser- rano principle becomes law? (Mrs. Carey) I have a couple of comments on the basis of what Professor Coons has said. I think the issue you have raised about income taxes is a key one. The experts on property tax, who I gather you are hearing next week, all can tell you how this tax can be administered in a progressive manner, but they cannot point to any community where it is being so ad- ministered. So, we have all bought that mythology for 10, 20, or 30 years, and the evidence is piling up that, per- haps the property tax cannot, in fact, be a progressive tax. This would be a strong persuasion for income tax. On the suggestion of removing industrial and commer- cial properties from the local assessment base, I think it would meet with tremendous resistance from the indus- trial and commercial interests. They have no desire at all to be assessed and taxed at the State level. You look at 7 : “ a United States Steel in Gary, Ind., they would fight it tooth and nail to prevent Indianapolis from doing the assess- ment, as opposed to the local assessor, who works part time | for them. On the private school issue, that is one that everyone kicks around. As a factual matter, I am not sure there’s any difference right now between the Scarsdale school system and Scarsdale with a private school system. It is just the admission practices that are slightly different. At present it is a question of buying a house rather than getting into a school. So, I am not sure that will change things from the way they are at present. Are Private Schools Nonprofit? Another thing to consider is whether, if private schools are actually set up as nonprofit corporations and so on, whether there would not be grounds for attacking them. There is a case, a Lawyers Committee case in Mississippi, Green v. Kennedy, where white parents tried to set up a school, a private school, for the purpose of avoiding inte gration, and the court knocked down their tax exemption on the ground that it was a deliberate evasion of the con- stitutional mandate. Now, if the Constitution declares education to be a fun- damental interest, it might be you could attack private schools on that ground. > (Senator Mondale) The key to the Green case was de- liberate segregation, white flight, designed to escape the court order. (Mrs. Carey) That is right. (Senator Mondale) You might say there is a similar constitutional principle, and that no one can escape the public schools. Maybe that will be the law. Go ahead. (Mrs. Carey) That is roughly what I wanted to say. 29a APPENDIX D EDUCATIONAL FINANCING AND EQUAL PROTECTION: WILL THE CALIFORNIA SUPREME CouRT’s BREAKTHROUGH . BECOME THE LAW OF THE LAND? a Hershel Shanks* The California Supreme Court handed down a decision last Fall which, if made applicable to other states of the Union, will require a thorough revamping of education financing laws in all states except Hawaii.! The California Court held for the first time that a state educational financing system which requires local school districts of varying wealth to raise even a part of their own education funds from local property taxes violates the equal protection clause of the Fourteenth Améend- ment. This result followed, said the Court, because such a system discriminates on the basis of wealth in the dis- tribution of educational resources. To the extent the local school district is required to assume the burden of supporting its public schools from its own taxes, the poorer districts are unable to provide the same level of financial support as their richer neighbors, even though the poorer district often impose on themselves higher tax rates than wealthier districts. Thus the educational opportunity — at least in economic terms — available to any child within the state depends on the wealth of the district in which he lives. “[S]uch a system cannot withstand constitutional challenge and must fall before the equal protection clause,””2 apa with Glassie, Pewett, Beebe and Shanks, Washington, ’ Hawaii already has a single unified school district. 1 * Serranto v. Priest, L.A. No. 29820, California Supreme Court, August 30, 1971, slip op. 2..On October 12, 1971, a federal district judge in Minnesota, relying on the Serrano decision, came to the same conclusion. Van Dusartz v. Hatfield, No. 3-71 Civ. 243 (D. Minn.). This ruling came in a denial of a motion to dismiss. The Court will retain jurisdiction but defer further action in the case 30a California’s School Finance Formula The California system for financing public education is typical of that which prevails throughout the United States. About one-third of the support for the public school system comes from the State. Ovér one-half is provided by local property taxes imposed by local school districts. Six percent comes from federal funds, and the remainder from miscellaneous sources. State aid consists of two types of grants from the State to the local school district. The first type is known as the fiat grant and consists of a payment to the local school dis- trict of $125 per pupil. It is distributed on a uniform per pupil basis to all districts, irrespective of their wealth. The flat grant constitutes about half of the funds distrib- uted by California to its local school districts. The second type is an equalization grant intended at least partially to ameliorate the disparities arising out of the differing abilities of districts of varying wealth to support local schools from local taxes. The equalization grant assures that every school district regardless of its poverty will have available to it a certain minimum - amount per pupil — $355 for each elementary school pupil and $488 for each high school student. This minimum amount would supposedly fund a so-called minimum “foundation program” .§ To compute the size of the equalization grant, two items are subtracted from the minimum foundation program amount: (1) the State’s flat grant and (2) the sum the local school district is expected to raise from its own taxes. The remainder is the equalization grant per pupil. In other words, the equalization grant consists of $355 for each elementary school pupil and $488 for each high pending action by the Minnesota legislature, so the ruling is not presently appealable. Since the Serrano decision, approximately 30 other states have filed or are considering filing Serrano-type suits. _ *In fact, far more is needed per pupil to fund an adequate pro- gram. | 3la school student less the $125 flat grant and less a hypo- thetical amount which would be raised by minimal local tax rates — 1 percent in elementary school districts and 8 percent in high school districts. In practice, however, only the poorer districts receive equalization grants under this formula. “For the wealthier districts, the flat grant of $125 plus minimal local taxes raises more than the mini- mum foundation program amount. While equalization grants are to some extent equalizing in their effects, the flat grant is anti-equalizing. For the poor district,.the flat grant is essentially meaningless be- cause anything taken away from the flat grant would be made up by an increased equalization grant of the same amount. The flat grant could be repealed without having any effect on the poor district. This is of course not true of wealthier districts who do not get an equalization grant. If the flat grant were repealed, the wealthier dis- tricts would lose $125 per pupil. Accordingly, the flat © grant actually widens the gap between rich and poor districts. The result of the California system of educational financ- ing — partially because the equalization grant does not go nearly far enough and partially because of the anti- equalizing effects of the flat grant — is a wide variation in per pupil expenditures from the poorer to the wealthier California school districts. Thus, the Baldwin Park Unified School District in Los Angeles spends only $577 to educate each of its students. By contract, the Beverly Hills Unified a District, also in Los Angeles, spends $1,231 per student. The fundamental injustice underlying this system is highlighted by the fact that the tax rate in Beverly Hills is just over 2 percent, while the tax rate in Baldwin Park is more than 5 percent. Thus, Beverly Hills can raise far more per pupil with far less effort than Baldwin Park. ‘California also. has an additional State program of “supple- mental aid” which is available to subsidize particularly poor school districts which are willing to make an extra local tax effort by setting their tax rates above a certain statutory level. : 32a The source of the disparity in per pupil funds available to the two districts is clear: The assessed valuation per pupil in Beverly Hills is thirteen times more than the assessed valuation per pupil in Baldwin Park. The assessed -valuation per pupil is $50,885 in Beverly Hills and $3,706 in Baldwin Park. The Court found “irrefutable” the contention that the foregoing system classifies students on the basis of the wealth of the district in which they happen to live. Indeed, “(t]he wealth of a school district, as measured by its as- sessed valuation, is the major determinant of educational expenditures.”’5 Requirements Under Serrano Assuming that this decision becomes the law of the land, what are its implications for educational financing and public education administration? It is of course clear that such a decision would require the revamping of educational financing systems through- out the country. But beyond this lie a number of questions. Will compliance with this decision require, or lead to, state control, if not actual operation of, local schools? In other words, does this decision spell the end of the local school district, locally controlled? Does the decision mean the end of local property taxes as a source of revenue to support public education? Does the decision require 100 percent state financing of public education? Does the de cision require equal dollar expenditures per pupil for each student within a state? Many educators and even some lawyers have assumed that the answer to all of these questions is “yes”. In fact, however, the answer to all of these questions is “no”. It is therefore important, at the outset, to understand what compliance with the decision will, and will not, require. The contention that the decision will result in state control and perhaps even state operation of local schools — 5 Slip Op. 240. 4 33a and thereby doom the local public school — is based on the assumption that the decision will require 100 percent state financing of public education. The argument is that whoever pays the piper will call the tune. Yet the assump- tion is incorrect. To be sure, a state may, but need not, comply with the decision by a system in which the state provides all of the funds for the public schools on a per pupil basis. But even if a state were to adopt a 100 percent state financing as its method of compliance, this would not necessarily mean state operation or control of local schools. Even now, local school districts are creatures of the state, created by state legislatures, and subject to all valid rules and regulations which the state legislature may decide to adopt. A state has the right under the present system of school financing to control or operate the local public schools. But in fact states have not done this, despite the fact that they provide a very substantial part of the local school districts’ educational budget. It could, of course, be argued that if states were to supply 100 percent of the local school budget, they would be more inclined to control the operations of the local school dis- tricts. This seems doubtful. Given the long history of doggedly independent local school control and operation, it is unlikely that the states would undertake to exert sub- stantially more control over local school systems simply because the extent of their financial support of these sys- tems increases from, say, 40 percent to 100 percent. But, in any event, the signal point to keep in mind for this purpose is that 100 percent state financing of public education is not required by the decision. Whether state educational financing systems may still rely on local property taxes, and, if so, whether at varying tax rates, locally determined, require a SO6mewhat fuller discussion of the Court’s reasoning. The evil which the Court found in the present system is that to some extent the number of dollars available per pupil in any given school district depends on the wealth — as measured by the assessed valuation per pupil — within that district. The Court condemned the relation between 34a educational offering (at least as measured in economic terms)® and wealth (as measured in assessed valuation per pupil). That is all the Court condemned. Compliance with the Court’s decision requires only that there be a divorce in this relationship of wealth with educational offering. The Court did not say how the divorce shall take ® Whether per pupil expenditures are in fact closely related to educational oleue of educational achievement has been hotly de- bated since the Coleman Report’s finding that “differences in school facilities and curriculum, which are the major variables by which attempts are made to improve schools, are so little related to differ- ences in achievement levels of students that, with few exceptions, their effects fail to appear even in a survey of this magnitude.” (James S. Coleman, et al., Equality of Educational Opportunity [ Washington: U. S. Government Printing Office, 1966]). Other distinguished critics question this finding. See Guthrie, Kleindorfer, Levin & Stout, Schools and Inequality (1971) and Bowles, “To- wards Equality of Educational Opportunity”, 38 Harv. Ed. Rev. (1968), reprinted in Equal Educational Opportunity (Cambridge: Harvard University Press, 1969). Although a definitive answer may not be available, it is difficult to disagree with Henry S. Dyer, who writes: We strongly suspect that the amount of money spent on in- struction can make a considerable difference in the quality of pupil performance, but how the funds are deployed and used probably makes even more of a difference. It seems reasonably clear that the effectiveness of schools is very, largely a function of the characteristics of the people in them — the pupils and their teachers — but we are still a long way from knowing in useful detail what specific changes in the people or in the edu- cational mix will produce what specific eatin for what spe- cific kinds of children [Dyer, “School Factors and Equal Edu- cational Opportunity”, 38 Harv. Ed. Rev. 38 (1968), reprinted in Equal Educational Opportunity (Cambridge: Harvard Uni- versity Press, 1969) ]. Nevertheless, it is difficult to imagine a court denying equal funds to the poor because differences in per pupil expenditures have not been shown to make a difference. On the contrary, courts appear to have assumed that dollars will make a difference see McInnis v, Shapiro, 293 F. Supp. 327, 331 (N.D. Ill. 1968), affirming mem. sub nom. McInnis v. Ogilvie, 394 U.S. 332 (1969); Hargrave v. Kirk, 313 F. Supp. 944 (M.D. Fla. 1970), vacated on other grounds, sub nom. Askew v. Kirk, 401 U.S. 476 (1971)), although successful, plain- tiffs may find themselves put to the proof, see Serrano v. Priest, slip op. 26-27 ; Hobson v. Hansen, 269 F. Supp. 401, 437 (D.D.C. 1967), affirmed sub nom. Smuck v. Hobson, 408 E . 2d 175 (D.C. Cir. 1969), and especially Hobson v. Hansen, 327 F. Supp. 844 (D.D.C. 1971). 35a place, or what systems of educational financing will meet this test of “non-relatedness of wealth and educational offering”. There are many ways of breaking this relationship which do not require abandonment of local taxes — even prop- erty taxes — as a source of support for local school sys- tems. For example, a state could provide that $1,000 per student will be available in each district within a state and that the local district must raise as much of this amount as would be produced by a 2 percent property tax. If that would produce in any particular district less than $1,000 per pupil, the state would make up the difference. If such a tax would produce more than $1,000 per pupil, the excess would be required to be paid to the state. This is a true 100 percent equalization formula.? The system just described breaks the relationship be- tween wealth and educational offering, but it retains a significant reliance on local property taxes to support local schools. It may be argued, however, that this system, like the system in which the state provides all of the funds for local education, produces an educational straight- jacket in which every school district is limited to $1,000 per pupil regardless of the importance which a particular local school district places on education and regardless of the effort which the residents of a particular district are willing to make to support their public schools. This is true, but the system may be varied so as to provide for different amounts depending on the effort (as expressed in its tax rate) the local district is willing to make to support public education. In other words, under the hold- ing in the Serrano case, it is constitutionally permissible to allow a variation in educational offering to depend on ‘In the example, the state requires the local district to impose the tax on real estate. However, the state need not make this re- quirement : The local district may be permitted to raise the money any way it wishes — by a real property tax or by any other form of taxation. Or it may be permitted to raise less than the amount that would be produced by a 2% property tax, in which event the 2% property tax would be used only as a measure of the state’s equali- zation obligation. effort the local district is willing to make. Remember at only disparities emanating from variations in wealth are forbidden by the Serrano decision. Suppose the formula is varied somewhat, to provide a differential in per pupil expenditures available to any dis- trict based on variations in local effort (i.e., local tax rates). Consider a system which provides that for each mill of local tax imposed by the local district, the local district would receive $50 per pupil. If one mill of tax produces less than $50°per pupil, the state will make up the differ- ence. If it produces more than $50 per pupil, the excess must be paid to the state. Under this system, the local district decides how many dollars per pupil it wishes to provide for public education. The greater effort it makes, as expressed in its tax rate, the greater per pupil expendi- tures it will have for its public education system. But the amount available to the local district does not depend on its wealth. A 30 mill tax will produce the same revenue per pupil ($1,500) in the poorest as in the wealthiest dis- trict. This system has been described as “district power- equalizing”’® because under it each district has the same power to produce educational funds for its own local school system, regardless of its wealth. © However, there are likely to be vociferous political ob- jections to a district power-equalizing system because of the effect of such a system on the wealthier districts.9 To understand where the political outcry will come from in any district power-equalizing scheme, consider the fol- lowing scenario, which is summarized in Table I. Assume, as is now the case, that each district raises its own school funds through local taxation but, for simplicity, without any state contribution. Assume further that District B, the wealthiest district in the state, is five times as wealthy in assessed valuation per pupil as District A, the poorest 8 See Coons, Clune & Sugarman, Private Wealth and Public Edu- cation. Cambridge: Harvard University Press (1971). ® However, such an effect necessarily results from any system which withdraws from the wealthier districts the advantages they previously had as a result of their wealth. 37a district in the state. District A imposes a 6 percent tax which produces $600 per pupil (1 percent tax — $100 per pupil). District B, however, imposes only a 3 percent tax, but this produces $1,500 per pupil (1 per cent tax -— $500 per pupil). Now suppose (see Hypothetical 1 in Table I) TABLE I Present System (Each District Retains What is Produced By Its Own Taxes) District A District B (Poor) (Wealthy ) Tax Rate Expenditures Per Pupil Tax Rate Expenditures 6% = $600 3% = $1,500 Hypothetical 1, Using A District Power-Equalizing System (All Districts Raised to Level of Best System) (1% Tax Rate = $500 Per Pupil) District A District B (Poor) (Wealthy ) Tax Rate Expenditures Per Pupil Tax Rate Expenditures (Including State Grant) Per Pupil 3% = $1,500 , 3% = $1,500 (i.e., $300 in local taxes and $1,200 State grant) Hypothetical 2, Using A District Power-Equalizing S ‘ystem (1% Tax Rate = $250 Per Pupil) District A District B (Poor) (Wealthy) Tax Rate Expenditures Per Pupil Tax Rate Expenditures (Including State Grant) Per Pupil 6% = $1,500 3% = $750 (i.e., $600 in local taxes and $900 or ~ state grant) 6% = $1,500 that this hypothetical state decides to comply with the Serrano decision by a district power-equalizing formula. One way to do this would be to provide that any district which taxes itself at the rate which District B presently 38a taxes itself will receive just as much money as District B. In other words, for each percent of tax imposed by the local district, the state will insure that the district wil] receive $500 per pupil. The effect of this district power- equalizing formula is to raise the entire state to the level of the wealthiest district, provided only that the other districts make the same effort (by imposing the same tax rate) as the wealthiest district. In the case of District A, it could reduce its tax rate from 6 percent to 3 percent and increase its per pupil expenditure 212 times, from $600 to $1,500. District B would retain its present tax rate of 3 percent and present per pupil expenditure of $1,500. The problem with this district power-equalizing formula is that it is enormously expensive and is likely to be regarded politically as prohibitively expensive. The total cost, the politicians will say, is too high. The state will then consider a district power-equalizing system that is pegged at a lower level (see Hypothetical 2 in Table I). The state will insure that the local district will receive, not $500 for each percent of tax it imposes, but $250. (Anything raised in excess of $250 for each percent would of course be paid to the state). This is all right with District A, the poorest district in the state. District A retains its 6 percent tax rate and, instead of having $600 per pupil, it will have $1,500 per pupil. However, District B now has a serious problem which is politically powerful residents are not likely to welcome. If District B retains its present 3 percent tax rate, it will find that it now will receive only $750 per pupil instead of the $1,500 per pupil which was previously produced by a 3 percent tax rate. If District B feels strongly that it does not want to lower the per pupil funds available t [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386414_0120%3A03. Public record. Not legal advice.