Indian Oasis-Baboquivari Unified School Dist. No. 40 of Pima County, Ariz. v. Kirk

• Decision Date: 31 July 1996
• Docket Number: OASIS-BABOQUIVARI,No. 93-16089,No. 20,20,93-16089
• Citation: 91 F.3d 1240
• Parties: 111 Ed. Law Rep. 655, 96 Cal. Daily Op. Serv. 5638, 96 Daily Journal D.A.R. 9219 INDIANUNIFIED SCHOOL DISTRICT NO. 40 OF PIMA COUNTY, ARIZONA; Whiteriver Unified School Districtof Navajo County; Clifford Pablo, next best friend of Clifford Pablo, Jr.; Cynthia Parker, Guardian of David Parker; Edlina Thompson, next best friend of Nelson Lupe, Plaintiffs-Appellants, v. James Lee KIRK, in his official capacity as Treasurer of Pima County, Arizona; C. Diane Bishop, in her official capacity as Superintendent of Public Instruction for the State of Arizona; Anita Lohr, in her official capacity as County School Superintendent for Pima County, Arizona; J.R. Despain in his official capacity as Treasurer of Navajo County, Arizona; William Bennett, in his official capacity as County School Superintendent for Navajo County, Arizona, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1240

91 F.3d 1240

111 Ed. Law Rep. 655, 96 Cal. Daily Op. Serv. 5638,

96 Daily Journal D.A.R. 9219

INDIAN OASIS-BABOQUIVARI UNIFIED SCHOOL DISTRICT NO. 40 OF

PIMA COUNTY, ARIZONA; Whiteriver Unified School District

No. 20 of Navajo County; Clifford Pablo, next best friend

of Clifford Pablo, Jr.; Cynthia Parker, Guardian of David

Parker; Edlina Thompson, next best friend of Nelson Lupe, Plaintiffs-Appellants, v. James Lee KIRK, in his official capacity as Treasurer of

Pima County, Arizona; C. Diane Bishop, in her official

capacity as Superintendent of Public Instruction for the

State of Arizona; Anita Lohr, in her official capacity as

County School Superintendent for Pima County, Arizona; J.R.

Despain in his official capacity as Treasurer of Navajo

County, Arizona; William Bennett, in his official capacity

as County School Superintendent for Navajo County, Arizona,

Defendants-Appellees.

No. 93-16089.

United States Court of Appeals,

Ninth Circuit.

Argued and Submitted Dec. 15, 1994.

Submission Vacated Jan. 9, 1995.

Resubmitted Jan. 31, 1995.

Decided July 31, 1996.

John R. McDonald, Deconcini, McDonald, Brammer, Yetwin & Lacy, Tucson, Arizona; and C. Benson Hufford, Hufford, Horstman, McCullough & Mongini, Flagstaff, Arizona, for plaintiffs-appellants.

Anthony B. Ching, Deputy Attorney General, Phoenix, Arizona, for defendants-appellees.

Appeal from the United States District Court for the District of Arizona, Charles R. Weiner, District Judge, Presiding. D.C. No. CV-92-00866-TUC-CRW.

Before: REINHARDT, WIGGINS, ^* and RYMER, Circuit Judges.

RYMER, Circuit Judge:

Two Arizona public school districts and several of their students brought suit in federal court against the Arizona Superintendent of Public Instruction and the county treasurers and school superintendents of Pima and Navajo Counties seeking declaratory and injunctive relief holding that A.R.S. § 15-991.02, which requires county treasurers to remit a portion of a school district's ending cash balance to a state fund used for equalization among rich and poor districts, violates the Federal Impact Aid Law, 20 U.S.C. §§ 236-244, and the Supremacy Clause in Article VI of the United States Constitution, by taking some of their federal Impact Aid funds. ¹ The district court dismissed the complaint on the ground that the districts are political subdivisions of the State of Arizona that lack standing to sue the state in federal court, and the students failed to allege distinct injury that is not derivative of the injury alleged by the school districts. It gave the students leave to amend, but they elected to appeal instead. We agree that neither the school districts nor the students have standing to bring this suit, and we therefore affirm.

I

The Indian Oasis-Baboquivari and Whiteriver Unified School Districts receive federal funds under the Impact Aid law. The federal law was enacted to compensate local school districts whose finances are impacted negatively by federal activities in the area. Among those eligible for Impact Aid are school districts, such as Indian Oasis and Whiteriver, serving pupils who live on Indian reservations.

Arizona had a complicated procedure for equalizing funding among its school districts. A.R.S. § 15-991.02 was enacted in 1992 as a supplement to its equalization assistance legislation. It required county treasurers to remit a portion of the ending cash balance in the school districts' maintenance and operation funds for use by the state for equalization assistance.

Both school districts and three of their students brought this suit to challenge the constitutionality of § 15-991.02. The complaint alleges that § 15-991.02 has the effect of taking a portion of the funds the districts got from the federal government pursuant to the federal Impact Aid Law because the state statute includes Impact Aid within the calculation of funds that must be remitted to the state for state equalization purposes. This, they contend, violates the federal statute and the Supremacy Clause, and will cause irreparable harm in that without those funds, the districts will have to curtail important programs and projects.

The state moved to dismiss the complaint for lack of standing. The district court held that under City of South Lake Tahoe v. California Tahoe Regional Planning Agency, 625 F.2d 231 (9th Cir.), cert. denied, 449 U.S. 1039, 101 S.Ct. 619, 66 L.Ed.2d 502 (1980), the school districts, which are creatures of the Arizona constitution and state statutes, lack the independent identity necessary to confer standing to assert a claim against the state in federal court. It likewise found the students' allegations of personalized injury deficient, and granted the state's motion to dismiss with leave to amend.

II

A

Indian Oasis and Whiteriver acknowledge the general rule of political subdivision standing doctrine that prohibits a political subdivision from bringing suit against the state of which it is a part, but argue that we should recognize an exception to the rule for constitutional challenges under the Supremacy Clause. They submit that the rule itself stems from cases involving individual rights, such as due process or equal protection, and should not be applied to claims that a state law interferes with federal law. Otherwise, the districts contend, they are powerless to challenge the state's violation of federal law in a federal court.

As the district court concluded, however, the districts' argument is foreclosed by South Lake Tahoe, which is controlling authority in this circuit. In that case, the City of South Lake Tahoe alleged that land use regulations adopted by the California Tahoe Regional Planning Agency violated the Fifth and Fourteenth Amendments, and conflicted with the plans and ordinances of the Tahoe Regional Planning Agency, a bistate agency approved by Congress, in violation of the Supremacy Clause. We held that the City, as a political subdivision of the state, could not challenge the statutes of the state itself, or one of its other political subdivisions, on constitutional grounds. Accordingly, we concluded, the standing component of federal jurisdiction was lacking and the City's claims, based on the Constitution, were properly dismissed.

Because a panel of this circuit may not overturn circuit precedent "unless an en banc decision, Supreme Court decision, or subsequent legislation undermines those decisions," Clow v. United States Dept. of Housing & Urban Dev., 948 F.2d 614, 616 n. 2 (9th Cir.1991) (quoting United States v. Washington, 872 F.2d 874, 880 (9th Cir.1989)), we are not free to consider the school districts' contention that decisions of other courts to the contrary are better reasoned. See, e.g., Rogers v. Brockette, 588 F.2d 1057 (5th Cir.) (recognizing school district's standing to bring a Supremacy Clause challenge to a state law requiring school district to participate in a federally-subsidized school breakfast program), cert. denied, 444 U.S. 827, 100 S.Ct. 52, 62 L.Ed.2d 35 (1979); San Diego Unified Port District v. Gianturco, 457 F.Supp. 283 (S.D.Cal.1978), aff'd on other grounds, 651 F.2d 1306 (9th Cir.1981), cert. denied, 455 U.S. 1000, 102 S.Ct. 1631, 71 L.Ed.2d 866 (1982). Urging us to heed criticism of South Lake Tahoe by the California Supreme Court, see Star-Kist Foods, Inc. v. County of Los Angeles, 42 Cal.3d 1, 227 Cal.Rptr. 391, 719 P.2d 987 (1986), cert. denied, 480 U.S. 930, 107 S.Ct. 1565, 94 L.Ed.2d 758 (1987), or by Justices White and Marshall dissenting from the Court's failure to grant certiorari, South Lake Tahoe, 449 U.S. 1039, 101 S.Ct. 619, 66 L.Ed.2d 502, or from another panel, Gianturco, 651 F.2d at 1309 n. 7, is likewise unavailing. We must follow South Lake Tahoe--right or wrong--unless intervening authority undermines the decision.

B

Assuming that we do feel constrained by South Lake Tahoe, Indian Oasis and Whiteriver alternatively contend that it is no longer good law in light of Lawrence County v. Lead-Deadwood School District, 469 U.S. 256, 105 S.Ct. 695, 83 L.Ed.2d 635 (1985), and Washington v. Seattle School District, 458 U.S. 457, 102 S.Ct. 3187, 73 L.Ed.2d 896 (1982). Although neither opinion directly overrules South Lake Tahoe, the school districts contend that both necessarily undercut it because the Court reached the merits of a constitutional challenge by a political subdivision to state law and must thereby have implicitly decided that the subdivision had standing to pursue a constitutional claim against the state.

In Lead-Deadwood, the Supreme Court of South Dakota had sustained a state statute regulating distribution of funds that units of local government received from the federal government. The United States Supreme Court concluded that Congress intended local governments to have more discretion in spending federal aid than the State would allow them, and therefore held that the statute was invalid under the Supremacy Clause.

In Seattle School District, school districts disgruntled with an Initiative that would have prohibited busing for desegregation purposes, sought to prevent the state from enforcing it on the ground that to do so would offend the Equal Protection Clause of the Fourteenth Amendment. Holding that the Initiative violated the Constitution, the Court went on to consider the state's argument that attorney's fees should not have been awarded to the school districts because state-funded entities are not eligible to receive such awards from the state. Seattle School Dist., 458 U.S. at 487 n. 31, 102 S.Ct. at 3204 n. 31. The Court stated that "[t]he Districts are plainly parties covered by the language of the fees statutes," id., and affirmed on this point.

We have no difficulty dismissing the impact of Lead-Deadwood, as the suit by a political subdivision in that case was brought and litigated in state court, and was decided before ASARCO, Inc. v. Kadish, 490 U.S. 605, 109 S.Ct. 2037, 104 L.Ed.2d 696 (1989), which clarified...