Exeter-West Greenwich Regional School Dist. v. Exeter-West Greenwich Teachers' Ass'n, EXETER-WEST

• Court: United States State Supreme Court of Rhode Island
• Writing for the Court: SHEA; Several years ago
• Citation: 489 A.2d 1010
• Parties: 24 Ed. Law Rep. 266 GREENWICH REGIONAL SCHOOL DISTRICT v.GREENWICH TEACHERS' ASSOCIATION et al.GREENWICH REGIONAL SCHOOL DISTRICT v. STATE of Rhode Island et al. Linda K. DARCY et al., v.GREENWICH REGIONAL SCHOOL DISTRICT COMMITTEE et al. P., 84-461-M.P. and 84-444-Appeal.
• Docket Number: Nos. 84-442-M,EXETER-WEST,s. 84-442-M
• Decision Date: 14 February 1985

Page 1010

489 A.2d 1010 24 Ed. Law Rep. 266 EXETER-WEST GREENWICH REGIONAL SCHOOL DISTRICT
v.
EXETER-WEST GREENWICH TEACHERS' ASSOCIATION et al.
EXETER-WEST GREENWICH REGIONAL SCHOOL DISTRICT
v.
STATE of Rhode Island et al.
Linda K. DARCY et al.,
v.
EXETER-WEST GREENWICH REGIONAL SCHOOL DISTRICT COMMITTEE et al. Nos. 84-442-M.P., 84-461-M.P. and 84-444-Appeal. Supreme Court of Rhode Island. Feb. 14, 1985.

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Bradford Gorham, Gorham & Gorham, Providence, for Exeter-West Greenwich School Dist.

James E. Purcell and Peter Lacouture, Tillinghast, Collins & Graham, Providence. for Linda K. Darcy.

Donald M. Gregory II, Wickford, for Town of Exeter.

Donald G. Elbert, Jr., Asst. Atty. Gen., Providence, for State of R.I.

Richard A. Skolnik, Lipsey & Skolnik, Providence, amicus curiae, R.I. Federation of Teachers.

Michael St. Pierre, Revens & DeLuca, Warwick, for Town of North Kingstown School Committee.

John Roney, Roney & Labinger, Providence, amicus curiae for R.I. League of Cities & Towns.

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Natale L. Urso and Thomas J. Liguori, Jr., Urso, Liguori & Urso, Westerly, for Exeter-West Greenwich Teachers' Assoc.

Michael Ursillo, Providence, for intervenor Kenny's Bus Service.

Frank J. Williams, Providence, for intervenor Galloway School Lines.

V. James Santanielli, Manning, West, Santaniello & Pari, Providence, for Town of West Greenwich.

Howard Haronian, Haronian, Paguin & Bramley, Inc., Warwick, for Bd. of Regents.

Gerard Cobleigh, Cobleigh, Watt, Rock & Giacobbe, Warwick, for Council 94 AFSMCE.

Forrest Avila, Legal Counsel to Comm'r of Educ., Providence, for Dept. of Educ.

OPINION

SHEA, Justice.

Before us is a tangle of litigation that includes two cases from the State Board of Regents for Education and two cases from the Superior Court. These cases have been consolidated for our review. An additional allied case awaits resolution in the Superior Court. The events that gave rise to the underlying controversy began on February 27, 1984.

By way of background, the Exeter-West Greenwich Regional School District (the district) was established by agreement between the towns of Exeter and West Greenwich and was ratified by the General Assembly in P.L.1965, ch. 80. Evidence presented in the several cases establishes that the district provides its own schools for grades kindergarten through grade 8. Students in grades 9 through 12 are educated at North Kingstown High School, the cost of which is borne by the district under contract with North Kingstown. The district currently has a five-year contract with North Kingstown covering the period beginning July 1, 1983, and continuing to June 30, 1988. There are additional contracts in effect for transportation and other services.

The appropriating body for the district is the regional school-district financial meeting that is open to all voters of Exeter and West Greenwich. We use the phrase "appropriating body" advisedly because the financial district meeting does not actually appropriate the money in the same sense that a financial town meeting does. Our reasons are that under P.L.1965, ch. 80, § 2, § VII(E), no discretion is left to the town within the regional district as to the amount of funding to be raised or expended. That section provides that the town must make a part of its budget the amount necessary to meet the budget approved by the district financial meeting. The language of that section provides that the money "shall be appropriated in full by the financial town meeting." (Emphasis added.) A budget is proposed by the regional district school committee and is adopted at the financial meeting, member towns being required to pay their allocated shares to the district. The district's fiscal year runs from July 1 to June 30. The district itself has no tax collector. The funds to operate the system are raised by the member towns through property assessment and taxation.

A regional district financial meeting was called to appropriate funds for the 1984-85 year on February 27, 1984. The school committee for the district proposed a budget of $4,210,075. This budget was to be funded by anticipated revenues from state aid to education of $2,091,138 (which was an increase of about $400,000 from the year before), from interest and other miscellaneous receipts amounting to $20,200, and from $2,098,737 from the towns of Exeter and West Greenwich. At the meeting, by a majority vote, the overall amount of the budget was reduced by approximately $400,000 to $3,809,880. This reduction did not appear to be the result of any financial crisis because the proposed budget would not have required any increases in taxes. The $400,000 increase in state-aid funds would have fully covered the budget increase over the previous year. In effect, what the financial meeting did was to reduce the amount of the proposed budget to the previous year's appropriation, thereby reducing by $400,000 what the combined

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towns would have to appropriate. In essence then it would appear that they used the increased state-aid-to-education funds to reduce the taxes of the towns of Exeter and West Greenwich.

On April 23, 1984, the district school committee, after attempting to reduce its budget to the amount appropriated, called a special regional district financial meeting at which it sought restoration of $300,000 of the $400,000 that had been eliminated at the February meeting. By majority vote, the proposed restoration was rejected.

As the July 1 fiscal year approached, the district school committee found itself in a deficit position within the meaning of the Lamb Act, so-called, P.L.1980, ch. 152, now codified at G.L.1956 (1981 Reenactment) §§ 16-2-18, and 16-2-21, and § 16-3-11(a), as amended by P.L.1981, ch. 397, § 1, which prohibits regional school districts from making any expenditures or incurring any liabilities not authorized at the regional school-district meeting. The school committee brought a declaratory judgment action on behalf of the district in the Superior Court, Washington County, on June 1, 1984, seeking instructions about what action it should take and what interim authority it had to pay bills or salaries pending resolution of the budget. The Superior Court entered an order on June 15, 1984, giving the district treasurer interim authority to pay the obligations of the district and referred the matter to the State Commissioner of Education for resolution. That case was decided by the commissioner on August 31, 1984, appealed to the Board of Regents for Education, which rendered a decision on September 13, 1984, affirming the commissioner, and is now before this court as No. 84-461-M.P. The commissioner had made findings that there was in fact a deficit of approximately $325,000 as of August 31, 1984, which funds would have to be appropriated, that further additional savings could not be found in the proposed budget, and that 94 percent of the proposed budget was earmarked for salaries, tuition, and transportation, all contractual obligations of the committee, the remaining 6 percent of the budget being for fuel and textbooks as mandated by § 16-23-2.

At the time that the school committee was filing its action for declaratory judgment, the Exeter-West Greenwich Teachers' Association (teachers) filed an unfair-labor-practice charge with the State Labor Relations Board against the district committee under G.L.1956 (1979 Reenactment) § 28-7-13 as amended by P.L.1979, ch. 126, § 1. The basis of the charge was the committee's refusal to sign a contract incorporating the terms of a November 1983 arbitrator's award. Representatives of the teachers and of the committee had worked together and had drafted a document that embodied the entire arbitration award. Although the district committee never signed the agreement, it never indicated that it would not sign it or that it would not perform any part of it. Chief among the terms of the award and the unsigned contract was that covering pay raises for the teachers over a three-year period--a 7 percent increase for 1983-84 starting March 1, 1984, a 7.2 percent increase for 1984-85, and a 7.9 percent increase for 1985-86. The school committee had previously implemented the first increase in the award for the 1983-84 school year, the district having sufficient funds to pay the scheduled increase during that period.

The Labor Relations Board held hearings and on September 13, 1984, rendered a decision that the arbitrator's award was contractually binding on the district, and ordered the district "immediately [to] execute the collective bargaining agreement." That decision and order have been appealed to the Superior Court by both parties. No decision has been rendered to date.

The opening day for school had been set for August 29, 1984, and a teacher orientation day had been set for August 28. At a meeting on August 14, 1984, the superintendent of schools for the district was instructed to reduce the salaries to the scale of the first half of the 1983-84 period with appropriate step increases. This was the

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scale that had been in effect prior to any pay increases granted in the arbitrator's award. The $3,800,000 that had been appropriated was sufficient to cover this reduced salary scale and the other contractual obligations of the district. The teachers reacted by striking.

The district committee brought suit in Superior Court requesting an injunction against the strike. After hearings on September 4, 5, and 6, 1984, the trial justice, after making appropriate findings, rendered a bench decision ordering the teachers to return to work conditional on the school committee's agreeing to pay the salary scale for the 1984-85 school-year period provided for in the arbitrator's award. The trial justice imposed that condition because he found that by taking certain actions consistent with the arbitrator's award, such as implementing the first pay increase, implementing the increase in class...