Smith v. Travis County Educ. Dist., No. 92-8244

• Court: United States Courts of Appeals. United States Court of Appeals (5th Circuit)
• Writing for the Court: KING
• Citation: 968 F.2d 453
• Parties: 76 Ed. Law Rep. 341 Coleman H. SMITH, et al., Plaintiffs-Appellants Cross-Appellees, v. TRAVIS COUNTY EDUCATION DISTRICT, et al., Defendants-Appellees Cross-Appellants.
• Docket Number: No. 92-8244
• Decision Date: 03 August 1992

Page 453

968 F.2d 453 76 Ed. Law Rep. 341 Coleman H. SMITH, et al., Plaintiffs-Appellants Cross-Appellees,
v.
TRAVIS COUNTY EDUCATION DISTRICT, et al.,
Defendants-Appellees Cross-Appellants. No. 92-8244. United States Court of Appeals,
Fifth Circuit. Aug. 3, 1992.

James H. Keahey, and M. Frank Powell, Powell & Associates, Austin, Tex., for plaintiffs-appellants.

Mark L. Perlmutter, Perlmutter & Reagan, Austin, Tex., for Connell Estates, et al.

Toni Hunter, Asst. Atty. Gen., Austin, Tex., for Texas Educ. Agency, Meno and Atty. Gen. of Texas.

Page 454

William H. Bingham, McGinis, Lockridge & Kilgore, Austin, Tex., for Travis County Educ. Dist.

Roger D. Hepworth and William M. Buechler, Henslee, Ryan & Groce, Austin, Tex., for County Educ. Dist. # 24 et al.

Peter G. Smith and John Pierce Griffin, Nichols, Jackson, Kirk & Dillard, Dallas, Tex., for Dallas County Educ. Dist.

Kent M. Rider, Calame, Line Barger, Graham & Pena, Austin, Tex., for Brown County Educ. Dist.

D. Kirk Swinney and Peter Michael Reed, McCreary, Veselka, Beck & Allen, Austin, Tex., for Comanche County Educ., et al.

John Crumpton Hardy, III and Keith Dollahite, Hardy & Atherton, Tyler, Tex., for Smith County Educ. Dist.

Appeals from the United States District Court for the Western District of Texas.

Before VAN GRAAFEILAND, ^* KING, and EMILIO M. GARZA, Circuit Judges.

KING, Circuit Judge:

Texas taxpayers appeal the judgment of the district court declining to enjoin the continued collection of taxes under a public school finance system which, the Texas Supreme Court ruled, violates the Texas Constitution. Travis County Education District, joined by other county education districts, the Texas Education Agency, and the Attorney General of Texas, cross-appeal the district court's decision, arguing that the district court lacked jurisdiction over the claim. Concluding that the Tax Injunction Act, 28 U.S.C. § 1341, bars the district court from entertaining the taxpayers' claim, we vacate its judgment and remand with instructions to dismiss the suit.

I.

This case involves the most recent challenge to Texas' public school finance system. ¹ On January 30, 1992, the Texas Supreme Court held that the Texas public school finance system levied ad valorem taxes in violation of Article VII, § 1-e of the Texas Constitution, and permitted county education districts (CEDs) to levy ad valorem taxes without prior voter approval in violation of Article VII, § 3 of the Texas Constitution. See Carrollton-Farmers Branch Indep. School Dist. v. Edgewood Indep. School Dist., 826 S.W.2d 489, 524 (Tex.1992) (Edgewood III ). Because the State Legislature was not in regular session, the Texas Supreme Court chose to defer the effect of its ruling for 17 months to avoid disruption to public school operations and to enable the Legislature "to consider all options fully." Id. at 522. Consequently, the Texas Supreme Court directed the state district judge to re-issue an injunction that prohibits the state Commissioner of Education and Comptroller from giving effect to certain provisions of the Texas Education Code, but stays the effect of this prohibition until June 1, 1993. See id. at 523 & n. 42, 524. The Texas Supreme Court also held that its ruling was not to be used as a defense to the payment of the 1991 and 1992 CED taxes. Id. at 522.

Two separate groups of Texas taxpayers filed suit against Travis County Education District and other CEDs pursuant to 42 U.S.C. § 1983 in federal district court. The taxpayers sought a declaratory judgment that the imposition and collection of the 1991 and 1992 CED taxes violated the due process clause of the Fourteenth Amendment to the U.S. Constitution. They also sought an injunction requiring that the State of Texas fashion an appropriate post-deprivation remedy to the unconstitutional

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collection of the 1991 CED taxes already paid, and an injunction prohibiting collection of the 1992 CED taxes. The district court consolidated the two suits and certified plaintiff and defendant classes. The Texas Education Agency and the Attorney General of Texas intervened as defendants.

On May 1, 1992, the district court denied the defendants' motions to dismiss for lack of jurisdiction. The district court determined that collection of the 1991 taxes did not violate due process because the Edgewood III ruling was entered after that tax year. However, the district court declared that continued collection of the 1992 taxes under the system violated due process. Nevertheless, the district court denied injunctive relief on the merits, finding that the public interest...