Adams v. Ala. Board of Educ. (Ex parte Ala. Board of Educ.)
| Decision Date | 09 September 2016 |
| Docket Number | 1150366 |
| Citation | 219 So.3d 604 |
| Parties | EX PARTE STATE OF ALABAMA BOARD OF EDUCATION et al. (In re: Sharper D. Adams et al. v. State of Alabama Board of Education et al.) |
| Court | Alabama Supreme Court |
David R. Boyd, Dorman Walker, and G. Lane Knight of Balch & Bingham LLP, Montgomery; and Juliana T. Dean, Alabama Department of Education, Montgomery, for petitioners.
Candis A. McGowan of Wiggins Childs Pantazis Fisher & Goldfarb, LLC, Birmingham; John D. Saxon, Birmingham; and Clinton M. Daughtrey, Montgomery, for respondents Sharper D. Adams et al.
Robert M. Weaver of Quinn, Conner, Weaver, Davies & Rouco, LLP, Decatur, Georgia, for respondents Lucy Armstrong et al.
The State of Alabama Board of Education ("SBOE"); Dr. Thomas B. Bice, individually and in his official capacity as the State Superintendent of Education;1 and Dr. Edward R. Richardson, individually and in his official capacity as the State Intervention Chief Financial Officer (hereinafter referred to collectively as "the petitioners"), petition this Court for a writ of mandamus directing the Jefferson Circuit Court ("the circuit court") to vacate its order denying the petitioners' motion to dismiss the claims filed against them by Sharper D. Adams and numerous other former employees of the Birmingham Board of Education ("the BBOE") (hereinafter referred to collectively as "the respondents")2 and to enter an order dismissing with prejudice all claims against the petitioners on the basis of immunity. We grant the petition in part, deny it in part, and issue the writ.
The School Fiscal Accountability Act, § 16-13A-1 et seq., Ala. Code 1975 ("the Accountability Act"), which became effective on June 1, 2006, Act No. 2006-196, Ala. Acts 2006, requires the State superintendent of education to oversee the financial integrity of the local school boards in Alabama. § 16-13A-2, Ala. Code 1975. The Accountability Act also requires local school boards to submit certain financial reports, including an annual projected budget, to the State chief education financial officer ("the CEFO"). §§ 16-13A-6 and –7, Ala. Code 1975. In addition, local school boards must establish and maintain a minimum-reserve fund equal to one month of the local school board's operating expenses. § 16-13A-9, Ala. Code 1975.
At the end of fiscal year 2011, the CEFO determined that 31 of Alabama's 134 local school boards, including the BBOE, did not have a fully funded minimum-reserve fund. In fiscal year 2012, although the BBOE's monthly operating expenses were approximately $17 million, the balance of the BBOE's minimum-reserve fund was approximately $2 million. Thus, pursuant to § 16-13A-9, the BBOE's minimum-reserve fund was underfunded by approximately $15 million.
In February 2012, because of the BBOE's failure to fully fund its minimum-reserve fund, the CEFO met with representatives of the BBOE and other noncompliant local school boards to help them prepare a plan to build and maintain the required minimum-reserve fund. Pursuant to the authority granted to the CEFO under the Accountability Act, the CEFO required the BBOE and other noncompliant local school boards to submit to the SBOE for its approval, by April 2, 2012, a financial-recovery plan detailing how the boards planned to fully fund their required minimum-reserve funds. Once approved by the SBOE, the local school boards' financial-recovery plans were to be adopted as a resolution by the local school board. The resolutions adopting the financial-recovery plans were to be submitted to the SBOE by May 31, 2012.
The BBOE failed to submit a financial-recovery plan to the SBOE for its approval by the April 2, 2012, deadline, and its minimum-reserve fund remained underfunded. As a result, on April 12, 2012, the SBOE adopted a "Resolution for an Investigative Review of the Governance of the [BBOE]." This resolution authorized and directed Dr. Bice to "investigate, review, and resolve by appropriate order(s) all controversies and matters" concerning the BBOE.
Throughout April and May 2012, the SBOE and the BBOE worked to create a financial-recovery plan for the BBOE. The CEFO met with the BBOE to discuss the specifics of a potential financial-recovery plan on April 18, April 24, and May 24, 2012.
On May 31, 2012, the CEFO and the superintendent of the BBOE presented a financial-recovery plan ("the financial-recovery plan") to the BBOE for the BBOE's adoption. The financial-recovery plan included, among other things, a reduction in force ("RIF"), which required that the jobs of the respondents, among others, be eliminated. The financial-recovery plan projected that the BBOE's required minimum-reserve fund would be fully funded at $17 million within two years of implementation of the plan.
On June 5, 2012, a motion was presented to the BBOE to approve the financial-recovery plan; the motion failed for lack of a majority. At the BBOE's next regular meeting, held on June 12, 2012, all the BBOE members present voted to approve the financial-recovery plan, but the financial-recovery plan as approved did not include details as to how the financial-recovery plan would be implemented.
On June 14, 2012, as a result of the BBOE's continued failure to approve the required financial-recovery plan (including a plan for implementation), the SBOE adopted a resolution, pursuant to § 16-6B-4, Ala. Code 1975,3 authorizing Dr. Bice to appoint a person to provide oversight of the BBOE's day-to-day operations and to advise and assist the BBOE with the implementation of the financial-recovery plan. This resolution further authorized Dr. Bice, in the event a financial-recovery plan, including implementation, was not approved by the BBOE at its June 26, 2012, meeting, to intervene and to assume direct control of the fiscal operation of the BBOE and to appoint a chief financial officer to manage the financial operations of the BBOE in order to restore the BBOE to a sound financial condition.
On June 26, 2012, the CEFO and the superintendent of the BBOE presented the implementation phase of the financial-recovery plan to the BBOE for its approval. However, the BBOE did not approve the financial-recovery plan. Dr. Bice then intervened and appointed Dr. Richardson as the chief financial officer for purposes of intervention, i.e., the State Intervention Chief Financial Officer.
The BBOE continued to resist the SBOE's efforts to implement the financial-recovery plan. As a result, the SBOE, Dr. Bice, and Attorney General Luther Strange ("the State plaintiffs") sued the BBOE and its members, in their official capacities, in the Jefferson Circuit Court on July 20, 2012, seeking declaratory and injunctive relief ("the SBOE action"). The State plaintiffs sought to determine the authority of the SBOE and Dr. Bice to control the BBOE's financial operations. The court entered a temporary restraining order preventing the BBOE from interfering with the implementation of the financial-recovery plan; from interfering with any other decision or action deemed necessary by the SBOE to ensure that schools included in the Birmingham School System opened for the academic year in a timely and orderly manner; or from interfering with Dr. Bice's and his staff's access to offices of the BBOE and its computers and files.
Meanwhile, on July 24, 2012, Dr. Bice presided over a BBOE meeting. At this meeting, the superintendent of the BBOE requested that the members of the BBOE vote to approve the implementation of the financial-recovery plan, which included the RIF. The vote of the members of the BBOE on the adoption of the financial-recovery plan was evenly split; Dr. Bice overrode the tie vote of the members of the BBOE and approved the implementation of the financial-recovery plan.
On August 13, 2012, the court in the SBOE action granted the SBOE's request for an injunction. The court held that the SBOE and Dr. Bice were authorized by Alabama law to take all the actions they had taken with respect to the BBOE. On October 11, 2012, after the final judgment had been entered, the respondents filed a motion to intervene in the SBOE action, which the Jefferson Circuit Court denied.
On January 22, 2013, the respondents filed the underlying action against the petitioners, the BBOE, and certain BBOE officials (the BBOE and the BBOE officials are hereinafter referred to collectively as "the BBOE defendants").4 In their complaint, the respondents sought a judgment declaring that the petitioners did not have the authority under state law to adopt and to implement the financial-recovery plan. Specifically, the respondents sought a judgment declaring that the petitioners did not have the authority to implement the RIF. Rather, the respondents alleged that the BBOE was the entity with the authority to adopt and to implement the financial-recovery plan, including the RIF, which, the respondents argued, it did not do, because its vote ended in a tie vote overridden by Dr. Bice's action. The respondents requested that they be reinstated to their now eliminated positions with the BBOE and that they be awarded money damages in the form of backpay from the time their positions with the BBOE were eliminated as a result of the implementation of the RIF. In a separate count, the respondents alleged that their due-process rights had been violated by the elimination of their positions. The respondents cited 42 U.S.C. § 1983 and alleged:
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