877 P.2d 806 (Ariz. 1994), CV-93-0168, Roosevelt Elementary School Dist. No. 66 v. Bishop

Docket Nº:CV-93-0168-T/AP.
Citation:877 P.2d 806, 179 Ariz. 233
Opinion Judge:[11] Martone
Party Name:ROOSEVELT ELEMENTARY SCHOOL DISTRICT NUMBER 66; Superior Unified School District Number 15; Isaac Elementary School District Number 5; San Carlos Unified School District Number 20; Evangelina Miranda, individually and as a parent of Mariela and George Dorame, minor children, and Manuel Bustamante, individually and as a parent of Gabrielle and Jack
Attorney:[7] Arizona Center for Law in the Public Interest, Phoenix, by Timothy M. Hogan and David S. Baron, Tucson, and Southern Arizona Legal Aid, Inc., Tucson, by William E. Morris, Attorneys for Plaintiffs/Appellants. [8] Grant Woods, Attorney General, Phoenix, by Anthony B. Ching, Assistant Attorney ...
Case Date:July 21, 1994
Court:Supreme Court of Arizona

Page 806

877 P.2d 806 (Ariz. 1994)

179 Ariz. 233

ROOSEVELT ELEMENTARY SCHOOL DISTRICT NUMBER 66; Superior Unified School District Number 15; Isaac Elementary School District Number 5; San Carlos Unified School District Number 20; Evangelina Miranda, individually and as a parent of Mariela and George Dorame, minor children, and Manuel Bustamante, individually and as a parent of Gabrielle and Jack Bustamante, minor children, Marco Antonio Ramirez, individually and as a parent of Elizabeth, Mark and Lydia Ramirez, on behalf of themselves and all others similarly situated, Plaintiffs/Appellants,


C. Diane BISHOP, Superintendent of Public Instruction, in her official capacity; State Board of Education, State of Arizona, Defendants/Appellees.

No. CV-93-0168-T/AP.

Supreme Court of Arizona.

July 21, 1994

Page 807

In Banc.

Page 808

[179 Ariz. 235] Arizona Center for Law in Public Interest by Timothy M. Hogan, Phoenix, and David S. Baron, and Southern AZ Legal Aid, Inc. by William E. Morris, Tucson, for plaintiffs/appellants.

Grant Woods, Atty. Gen. by Anthony B. Ching, Asst. Atty. Gen., Phoenix, for defendants/appellees.

Thomas W. Pickrell and Lewis and Roca by John P. Frank, David J. Cantelme, Mary Ellen Simonson and Richard A. Halloran, Phoenix, for amicus curiae AZ School Boards Ass'n, Inc.


MARTONE, Justice.

The question we decide today is whether a statutory financing scheme for public education that is itself the cause of gross disparities in school facilities complies with the "general and uniform" requirement of Article XI, § 1 of the Arizona Constitution. We hold that it does not.

This is an action brought by certain school districts and classes of parents against the Superintendent of Public Instruction and the State of Arizona seeking a declaration that the statutory scheme for financing public education in Arizona violates the Arizona Constitution. The districts moved for summary judgment. In opposition, the state argued that it was entitled to summary judgment against the districts and claimed the districts' complaint failed to state a claim upon which relief could be granted. At argument on the districts' motion, the state conceded that it did not controvert the districts' factual submission, and both sides apparently agreed that the only issue before the court was whether the districts or the state were entitled to judgment as a matter of law. Even though the state had not filed a motion for summary judgment, the parties agreed at argument that the court was "to treat this matter as though cross-motions for summary judgment were before [it]." Judgment of September 18, 1992, at 2.

The court observed that the undisputed record showed enormous facility disparities among the various school districts and traced these disparities to the statutory scheme, which relies in large part on local property taxation for public school capital requirements. Nevertheless, the court concluded that, as a matter of law, no claim was stated under the Arizona Constitution. It denied the districts' motion for summary judgment and, in dismissing the districts' complaint, in effect granted the state's unasserted cross-motion for summary judgment.

The districts filed an appeal in the court of appeals and then filed a petition for an order transferring the case to this court. We transferred the case because the issues are of statewide importance, involve a claim that decisions of this court should be overruled or qualified, and require an interpretation of the Arizona Constitution. See Rule 19(a), Ariz.R.Civ.App.P. We now reverse the judgment of the superior court and remand the case for entry of judgment in favor of the districts and against the state on the districts' claim for declaratory relief.


    We first describe the undisputed facts and then Arizona's statutory scheme for financing public education.

    1. Facts

      The quality of elementary and high school facilities in Arizona varies enormously from district to district. There are disparities in the number of schools, their condition, their age, and the quality of classrooms and equipment. Some districts have schoolhouses that are unsafe, unhealthy, and in violation of building, fire, and safety codes. Some districts use dirt lots for playgrounds. There are schools without libraries, science laboratories, computer rooms, art programs, gymnasiums, and auditoriums. But in other districts, there are schools with indoor swimming pools, a domed stadium, science laboratories, television studios, well stocked libraries, satellite dishes, and extensive computer systems.

      Page 809

      [179 Ariz. 236] The quality of a district's capital facilities is directly proportional to the value of real property within the district. There is wide disparity in assessed valuation per pupil among the school districts in Arizona. Property-rich districts are not necessarily districts in which rich people live. A district with much taxable commercial property, or with a power plant within its boundaries, is property-rich even though its residents may be lower income. For example, the assessed value of the Ruth Fisher Elementary School District approaches $2 billion because the Palo Verde Nuclear Generating Station is located there. As a result, Ruth Fisher Elementary School District has the greatest level of assessed valuation per pupil at $5.8 million. School Management Information Data 1990, Arizona State University, College of Education 75 [hereinafter School Management ] (based on selected data 1988/89). In contrast, the San Carlos Unified District has an assessed valuation per pupil of $749. Id. There is scarcely any commercial property in the San Carlos district because it lies within Gila county, where only 4% of the land is available for commercial or individual use. Id. at 15.

      A property-poor district with high tax rates may generate less revenue for the capital needs of the district than a property-rich district with low tax rates. For example, in 1989-90, the Roosevelt School District in south Phoenix had a composite tax rate 1 of $4.37 per $100 of assessed value, while the Ruth Fisher School District had a tax rate of $.11 per $100 of assessed value. Id. at 76.

      Even if the commercial property in districts is comparable, demographic factors such as income and student population will cause disparities. For example, the Madison Elementary School District and the Roosevelt Elementary School District have similar distributions of commercial and residential property. But Madison is located in north central Phoenix and is largely middle income while Roosevelt is located in south Phoenix and is largely lower income. Residential property values differ significantly, which is a cause of the large property value disparity: $526 million for Madison compared to $195 million for Roosevelt. Moreover, Roosevelt has more students. Thus, Madison's assessed value per pupil is $130,778 while Roosevelt's assessed value per pupil is only $18,293. School Management at 29; see also Affidavit of Sid Borcher at 4.

      The Superintendent of Public Instruction admits that there is a "sense of ... bareness about some of the facilities in the poorer districts, that they are minimal.... It is basically four walls, a roof, and classroom inside, and that's about the extent of it." Deposition of Diane Bishop at 16. She acknowledges that the state budget is insufficient for the capital needs of many school districts, id. at 33-34, and that a district's property value largely determines its ability to construct new buildings and to buy computers and textbooks. Id. at 34. The Superintendent agrees that the quality of education a child receives in Arizona should not depend on whether the child lives in a wealthy or poor school district. Id. at 38. Indeed, the Superintendent "think[s] education is a state responsibility and that all children of the state have the same rights to education." Id.

    2. The Statutory Scheme for Public School Financing

      The Arizona education statutes reflect the complexity of the underlying system. See A.R.S. §§ 15-101 to -1901. The statutes assign tasks to the state and delegate others to the counties and local school districts. School districts, political subdivisions of the state with geographic boundaries, are organized to administer, support and maintain public schools. A.R.S. § 15-101(15). The statutes accommodate pre-statehood districts, A.R.S. § 15-441(A), new districts, § 15-443, and allow for changes in district boundaries. § 15-460.

      The financing scheme is particularly complex. See A.R.S. §§ 15-901 to -1241. If lack

      Page 810

      [179 Ariz. 237] of clarity alone were sufficient to strike these statutes down, this case would be less difficult. We are fortunate, however, that the parties share a common understanding of how Arizona's public schools are financed.

      The statutes create an educational funding formula. First, each district's base-level funding needs are determined by multiplying the number of students in the district by an arbitrary, state-wide dollar amount per pupil. A.R.S. § 15-943. The per-pupil amount appears to be unrelated to any minimum amount necessary for a basic education. 2

      The formula then determines the districts' share of the base level. The required contribution by a district is derived by multiplying the district's total assessed property value by an arbitrary dollar figure that each district is expected to collect from property taxes. A.R.S. § 15-971(D). If a district's required contribution falls short of the predetermined base level, the state makes up the difference. Id. If the district's expected contribution exceeds the base level, the district is not entitled to any state "equalization assistance." Id.

      Finally, any funding in excess of the equalized level must be raised through bonded indebtedness by the individual districts. These bonds are subject to voter approval because they...

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