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Campaign for Fiscal Equity v. State is the latest school finance case that seems as if it will never end.

Three weeks after winning its latest victory in the courts, the New York City-based legal-advocacy group that represents the plaintiffs is still waiting for the final resolution to the lawsuit, filed in 1993. It seeks additional operating money for schools in the city.

Without a final resolution in sight, participants and observers are saying that the ultimate solution to the case will rely on the politicians who decide how to appropriate money, not the judges who declare whether enough is being spent.

Case History

The Campaign for Fiscal Equity鈥檚 school finance case against New York state began more than a decade ago.

May 1993
• The CFE, acting on behalf of residents and education advocacy groups, files a lawsuit in state supreme court, a trial-level court, in Manhattan, challenging the constitutionality of the state鈥檚 school aid system.

The New York City case is being watched with particular interest because the question of checks and balances鈥攖he competing powers vested in each branch of government鈥攊s playing itself out in school finance cases throughout the country.

While the state鈥檚 legislature has passed a budget that would comply with the court鈥檚 order to finance $9.2 billion in construction costs in New York City, the budget would not provide a significant down payment on the $4.7 billion or more in operating aid the state appellate court ordered lawmakers to consider spending to end the lawsuit.

鈥淭hese issues are profoundly political,鈥� said Martha Derthick, a professor emeritus of politics at the University of Virginia in Charlottesville. 鈥淭rying to get the court to settle it doesn鈥檛 take the politics out of it, it just brings the courts into it.鈥�

But school finance attorneys say that courts still have a significant role to play in prodding鈥攐r even compelling鈥攍awmakers to spend money on schools that they otherwise wouldn鈥檛.

鈥淭hrough litigation, we can compel action,鈥� said James P. Molloy, a Helena, Mont.-based lawyer representing school districts in Montana鈥檚 4-year-old school finance case. 鈥淏ut the action compelled happens in the executive and legislative branches.鈥�

2006 and Beyond

This month alone, lawmakers in two states will consider major changes to their school finance systems in response to orders from their supreme courts.

In Kansas, the legislature will debate later this month school finance bills that would adopt three-year plans to increase the $2.1 billion the state spends on K-12 schools from $480 million to $558 million. The lawmakers are working to comply with a 2005 Kansas supreme court decision saying the legislature should provide enough school financing to ensure students meet the state鈥檚 academic standards. (鈥淜an. Lawmakers Agree on Spending Plan,鈥� July 13, 2005)

In Texas, lawmakers will convene next week in a special session to rewrite the tax code because the state鈥檚 highest court declared the statewide property tax unconstitutional.

They won鈥檛 need to increase the amount the state spends on schools, though, because the court said in its November decision that Texas schools spend enough to meet constitutional guarantees. (鈥淭exas School Finance Ruling Draws National Attention,鈥� Dec. 7, 2005)

In New York, the issues raised by the CFE case are bound to continue into 2007.

The latest chapter started on March 23 when the state鈥檚 appellate court ordered the state legislature to consider adopting a four-year plan to increase operating aid in New York City public schools from $4.7 billion to $5.6 billion.

The court also said the legislature should set up a $9.2 billion building program for the city schools. The court set a deadline of April 1鈥攖he first day of the state鈥檚 2007 fiscal year.

The financial amounts were similar to a trial-court judge鈥檚 February 2005 order issued after the state failed to meet a July 30, 2004, deadline to fix the financing of New York City schools set by the state鈥檚 highest court in a 2003 decision.

While CFE officials declared the March decision a major victory, the court鈥檚 order did not include any punitive action if the state failed to comply by the April 1 deadline.

鈥淚n the final analysis it is for the governor and the legislature to make the determination as to the constitutionally mandated amount of funding,鈥� Presiding Justice John T. Buckley wrote in the 3-2 decision.

Without a compelling reason to act, however, the lawmakers passed a budget that included the capital funding the court ordered but fell short of the operating aid it suggested.

Gov. George E. Pataki has until this week to sign the budget. He has not decided whether to use his line-item veto on the K-12 figures in the budget, said John Sweeney, a spokesman for the Republican governor.

Lawmakers appropriate the capital spending for a variety of reasons, said state Sen. Steven M. Saland, the chairman of the Senate education committee. The state never seriously contested the CFE鈥檚 argument that the city schools need that much money, and New York City Mayor Michael R. Bloomberg, a Republican, lobbied hardest for the construction aid, Mr. Saland said.

But the amount of operating aid the district deserves is still a point of contention, he added, because lawmakers don鈥檛 want the courts to impinge on their powers to appropriate money鈥攁 power explicitly given to the legislature in the state鈥檚 constitution.

鈥淲hile there鈥檚 an issue on the merits on what the cost is of a sound basic education,鈥� Mr. Saland said, 鈥渨e have always believed that this was a matter for the legislature, not the courts.鈥�

In its budget, the legislature appropriated an additional $1.1 billion in statewide K-12 spending鈥攁 7 percent increase for the 2006-07 school year over the current year. New York City would receive a $427 million increase in state aid鈥攁 7 percent increase, according to the New York state education department. The budget would not promise money for future years.

鈥楥ourts Don鈥檛 Have Armies鈥�

In the CFE case, the question remains: What actions can and will the courts take to prod the 13-year-old case to a resolution?

The CFE has previously argued that judges can fine the state an amount that the court has decided that New York City鈥檚 schools deserve under the state constitution. The trial-court judge has declined to issue those fines.

The CFE is also considering whether to ask the court to shut down schools if the state doesn鈥檛 appropriate that money, a deadline that has been effective in spurring action from state legislatures, said Michael A. Rebell, a counsel to the group.

But courts don鈥檛 have the political or executive powers to impose their wills on the legislative and executive branches of government, legal scholars say.

鈥淐ourts don鈥檛 have armies,鈥� said David Schoenbrod, a professor at the New York Law School and a senior fellow at the Cato Institute, a Washington-based think tank. The most effective courts declare situations that need to be fixed and then 鈥渓eave the remedy to the political process,鈥� he said.

School finance advocates agree that the ultimate resolution to CFE v. State and cases like it will be completed in the political branches. But they also say that courts have the authority to force politicians to act.

鈥淐ourts are 鈥� appropriately deferential toward the political branches in affording them the opportunity to find solutions,鈥� said Mr. Molloy, the Montana attorney. 鈥淐ourts have avoided getting to the point where they have exerted all of their power.鈥�

Solution Ahead?

In New York, Mr. Saland predicted politicians would eventually find a solution. One of the biggest barriers this year are the upcoming elections, in which Democrats are trying to take the Senate majority away from Republicans and voters will choose a successor to Mr. Pataki, who isn鈥檛 seeking re-election.

鈥淚n order to get a political resolution,鈥� Mr. Saland said, 鈥渨hat鈥檚 going to be required is to get past these next elections and hopefully everyone will be willing to come to the table.鈥�

To get there, the CFE will consider its options to get a new court order and continue to lobby the state legislature for the money the group believes the New York City schools deserve.

鈥淓ven the New York legislature, with all of its resistance and dysfunction, if you keep the pressure on, the legislature will get the message,鈥� said Mr. Rebell, who was the CFE鈥檚 executive director from 1993 until last year. He is now the executive director of the Campaign for Educational Equity, an effort to help eliminate achievement gaps between minority and white students, based at Teachers College, Columbia University.