Martinez v. Board of Educ. of Taos Mun. School Dist.

• Decision Date: 21 November 1984
• Docket Number: Nos. 83-1680,83-1764,s. 83-1680
• Citation: 748 F.2d 1393
• Parties: 21 Ed. Law Rep. 494 Charles R. MARTINEZ, Plaintiff-Appellant, Cross-Appellee, v. The BOARD OF EDUCATION OF the TAOS MUNICIPAL SCHOOL DISTRICT and Members Tina V. Martinez, Gabriel Chavez, Alex Medina and Arsenio Cordova, individually and as members of said Board, Defendants-Appellees, Cross-Appellants.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 1393

748 F.2d 1393

21 Ed. Law Rep. 494

Charles R. MARTINEZ, Plaintiff-Appellant, Cross-Appellee, v. The BOARD OF EDUCATION OF the TAOS MUNICIPAL SCHOOL DISTRICT and Members Tina V. Martinez, Gabriel Chavez, Alex Medina and Arsenio Cordova, individually and as members of said

Board, Defendants-Appellees, Cross-Appellants.

Nos. 83-1680, 83-1764.

United States Court of Appeals, Tenth Circuit.

Nov. 21, 1984.

Michael D. Bustamante, Ortega & Snead, P.A., Albuquerque, N.M., for plaintiff-appellant, cross-appellee.

Daniel H. Friedman, Simons, Cuddy & Friedman, Santa Fe, N.M. (C. Emery Cuddy, Jr., Santa Fe, N.M., with him on brief), for defendants-appellees, cross-appellants.

Before HOLLOWAY, Chief Judge, and SETH and BARRETT, Circuit Judges.

SETH, Circuit Judge.

This is an action for damages against a local school board and against members in their individual and official capacities. Plaintiff asserts that he was terminated as Superintendent because of his "real or imagined" political activities in the school board election.

Before trial defendants moved to have the Board and individuals in their official capacities dismissed under the Eleventh Amendment. The motion was granted. The trial proceeded on the First Amendment and the conspiracy count against the four Board members in their individual capacities only. The jury returned special interrogatories that plaintiff's political conduct was not a substantial or motivating factor in defendants' decision not to reemploy plaintiff. The verdict was against plaintiff.

This appeal by plaintiff is directed to the Eleventh Amendment issue and to jury instructions. The defendants have cross-appealed on the issue as to whether plaintiff was a policy maker (Branti v. Finkel, 445 U.S. 507, 100 S.Ct. 1287, 63 L.Ed.2d 574), and on good faith immunity (Harlow v. Fitzgerald, 457 U.S. 800, 102 S.Ct. 2727, 73 L.Ed.2d 396).

On the Eleventh Amendment issue and the autonomy and who pays the judgment issue, the attorney for the plaintiff acknowledged in his brief and at argument that the judgment there sought would be paid by state funds and handled by the Risk Management Division of state government (Sec. 41-4-20(A)(2)). The Division uses the state public liability fund which receives appropriations from the legislature and insures some risks.

Plaintiff argues in substance that the source of funds used to pay judgments should not be used in an Eleventh Amendment analysis or should not be a substantial element. He urges that Mt. Healthy City Board of Ed. v. Doyle, 429 U.S. 274, 97 S.Ct. 568, 50 L.Ed.2d 471, and an examination of the Ohio statutes there considered permit this conclusion as does our Unified School District No. 480 v. Epperson, 583 F.2d 1118 (10th Cir.).

On the autonomy issue it is necessary to consider the relationship between the local school boards or districts and the state government. New Mexico from the outset has taken an extreme position on the responsibility of state government for the local school systems both as to administration and finances.

Thus the relation was established by the state constitution. Article XII, Sec. 6, after creating a state department and state board of education and after stating that the state board "shall determine public school policy," provides that the state board:

"shall have control, management and direction of all public schools, pursuant to authority and powers provided by law."

It is difficult to conceive of broader powers in the state board than having "control, management and direction" of all public schools. This has to be well beyond the "some guidance" referred to in Mt. Healthy City Board of Ed. v. Doyle, 429 U.S. 274, 97 S.Ct. 568, 50 L.Ed.2d 471.

The constitutional powers of the state board were particularized by the legislature by the Session Laws of 1923. These were carried forward in the 1929, 1941 and 1953 compilations. The duties were again codified in 1953 and then entitled the Public School Code. This basically became what is now Sec. 22-1-1 and following of the New Mexico Statutes (1978). Thus the state board's powers are of long standing. In the 1978 statutes, in subsections A to X of Sec. 22-2-2, the duties of the state board are listed. Some are as follows:

"E. designate courses of instruction to be taught in all public schools in the state;

....

"G. determine the qualifications for ... any person teaching ... or administering in public schools according to law ... a system of classification adopted ... by the state board;

"H. suspend or revoke a certificate held by a ... instructor or administrator according to law for incompetency, immorality or for any other good and just cause;

....

"J. prescribe courses of instruction, requirements for graduation and standards for all public schools ...;

"K. adopt regulations for the administration of all public schools ... ;

....

"O. accept and receive all grants of money from the federal government ... and disburse the money ...;

....

"V. provide for management ... to operate any public school or school district which has failed to meet requirements of law, state board standards or state board regulations ...."

Some of these enumerated powers were in the Ohio statute considered in Mt. Healthy, but they were not in the context of the state board's "control, management and direction."

As indicated, the state board can operate districts which do not conform to the board's regulations and standards. The board or the state superintendent can suspend such a local board, and is required to do so. No prior hearing is required. This has been done on a number of recent occasions.

There exists with the above State Board of Education control a separate system of pervasive financial control over all school districts exercised by a different state agency. Thus as to budgets, the control appears to be complete. The Public School Finance Act (N.M.Stat.Ann. Sec. 22-8-1 (1978)) provides that the New Mexico Department of Finance and Administration (which contains an Office of Education) shall conduct budget making with the local board. The budget so drafted is then submitted to the Department for its unrestricted consideration. The budget must be there certified to be valid. The statute provides that no expenditure can be made by a school district unless it is in accordance with the budget certified by the Department.

The Public School Finance Act also provides that the districts or boards cannot hold funds unless specifically permitted to do so by the state. If not so permitted, the County Treasurer holds and disburses the funds (Sec. 22-8-37).

The statutes provide each school budget must contain one of three methods to meet judgments obtained in civil rights actions. The three methods are: (1) establish reserves out of budgeted funds; (2) buy commercial insurance coverage; (3) participate in the New Mexico public liability fund.

Section 41-4-20 provides that the Department of Finance and Administration is prohibited from approving any school district budget which does not budget for the risk of civil rights judgments. This statutory provision is very significant on the particular issue here concerned.

The state control over budgets is complete because the budgeting is of state funds distributed to the schools. In the 1982-1983 school year 96% of the school district funds statewide were provided by the state. The small amount of "local funds" comes mostly from a share in motor vehicle fees collected by the state and distributed to the counties. In a companion case the record shows that state funds provided 98.8% of the last school budget in Mora County.

It would seem...