Alvarado Appellants Brief

NO. 05-0145

 

In The

Supreme Court of Texas

_______________________________________________

ALVARADO INDEPENDENT SCHOOL DISTRICT, et al.,

                                                                                                            Appellants

 

V.

 

SHIRLEY NEELEY, IN HER OFFICIAL CAPACITY AS TEXAS COMMISSIONEROF EDUCATION, THE TEXAS EDUCATION AGENCY,

CAROL KEETON STRAYHORN, IN HER OFFICIAL CAPACITY

AS TEXAS COMPTROLLER OF PUBLIC ACCOUNTS, AND

THE TEXAS STATE BOARD OF EDUCATION,  

                                                                        Appellees

_______________________________________________

 

On Direct Appeal from the 250th District Court, Austin, Travis County, Texas

_______________________________________________

 

ALVARADO APPELLANTS’ BRIEF

_______________________________________________

 

                                                                                    RAY, WOOD & BONILLA, L.L.P.

                                                                                    Doug W. Ray

                                                                                    State Bar No. 16599200

                                                                                    Randall B. Wood

                                                                                    State Bar No. 21905000

                                                                                    2700 Bee Caves Road #200

                                                                                    Austin, Texas 78746

                                                                                    Telephone: (512) 328-8877

                                                                                    Facsimile:   (512) 328-1156

ATTORNEYS FOR ALVARADO

APPELLANTS

 

ORAL ARGUMENT REQUESTED

 

Identity of Parties and Counsel

 

Alvarado Appellants:

Alvarado Independent School District consisting of Abbott ISD, Academy CISD, Aldine ISD, Alpine ISD, Alvarado ISD, Amarillo ISD, Anna ISD, Anthony ISD, Aspermont ISD, Athens ISD, Aubrey ISD, Avalon ISD, Avery ISD, Axtell ISD, Balmorhea ISD, Bangs ISD, Beeville ISD, Bells ISD, Belton ISD, Big Sandy ISD, Blanket ISD, Blooming Grove ISD, Boles ISD, Boling ISD, Bonham ISD, Booker ISD, Borger ISD, Bowie ISD, Brock ISD, Brownfield ISD, Bruceville-Eddy ISD, Bryson ISD, Buckholts ISD, Burkburnett ISD, Burkeville ISD, Cameron ISD, Campbell ISD, Canton ISD, Canutillo ISD, Canyon ISD, Central Heights ISD, Central ISD, Chapel Hill ISD, Childress ISD, China Spring ISD, Chireno ISD, Cisco ISD, City View ISD, Cleburne ISD, Clint ISD, Coleman ISD, Collinsville ISD, Commerce ISD, Community ISD, Como-Pickton ISD, Connally ISD, Cooper ISD, Copperas Cove ISD, Corpus Christi ISD, Cotton Center ISD, Covington ISD, Crandall ISD, Crawford ISD, Crosby ISD, Dalhart ISD, Desoto ISD, Detroit ISD, Diboll ISD, Dickinson ISD, Dilley ISD, Dime Box ISD, Dimmitt ISD, Dodd City ISD, Douglass ISD, Driscoll ISD, Early ISD, Ector ISD, El Paso ISD, Electra ISD, Elkhart ISD, Elysian Fields ISD, Ennis ISD, Era CISD, Etoile ISD, Everman ISD, Falls City ISD, Fannindel ISD, Ferris ISD, Forney ISD, Fort Davis ISD, Fort Worth ISD, Frost ISD, Gainsville ISD, Ganado ISD, Garrison ISD, Gilmer ISD, Godley ISD, Grandview ISD, Gregory-Portland ISD, Gunter ISD, Hale Center ISD, Hamlin ISD, Harleton ISD, Hart ISD, Haskell CISD, Hawley ISD, Hearne ISD, Hemphill ISD, Hereford ISD, Hico ISD, Hidalgo ISD, High Island ISD, Holland ISD, Honey Grove ISD, Hubbard ISD, Hudson ISD, Huffman ISD, Huntington ISD, Hutto ISD, Itasca ISD, Jacksboro ISD, Jasper ISD, Joaquin ISD, Karnes City ISD, Kermit ISD, Kirbyville ISD, Knox City-O’Brien CISD, Kountze ISD, Kress ISD, Krum ISD, La Joya ISD, La Pryor ISD, Lake Worth ISD, Lamesa ISD, Lasara ISD, Latexo ISD, Leverett’s Chapel ISD, Linden-Kildare CISD, Lingleville ISD, Lipan ISD, Lockhart ISD, Lorena ISD, Louise ISD, Lyford ISD, Lytle ISD, Mabank ISD, Magnolia ISD, Martinsville ISD, McGregor ISD, Meadow ISD, Megargel ISD, Mercedes ISD, Meridian ISD, Merkel ISD, Mesquite ISD, Mildred ISD, Millsap ISD, Mission CISD, Montague ISD, Morton ISD, Motley County ISD, Muenster ISD, Nederland ISD, New Boston ISD, New Castle ISD, New Home ISD, New Summerfield ISD, Newton ISD, Nocona ISD, Nueces Canyon CISD, Olfen ISD, Olton ISD, Orange Grove ISD, Paint Creek ISD, Pampa ISD, Panhandle ISD, Paradise ISD, Paris ISD, Perrin-Whitt CISD, Petersburg ISD, Pflugerville ISD, Poteet ISD, Pottsboro ISD, Prairiland ISD, Premont ISD, Presidio ISD, Princeton ISD, Quanah ISD, Ranger ISD, Redwater ISD, Ricardo ISD, Rice CISD, Rice ISD, Rio Vista ISD, Rivercrest ISD, Robinson ISD, Robstown ISD, Roby CISD, Rochester County Line ISD, Rocksprings ISD, Rogers ISD, Roosevelt ISD, Rosebud-Lott ISD, Rusk ISD, Sam Rayburn ISD, Samnorwood ISD, San Agustine ISD, San Perlita ISD, Sands CISD, Sanford ISD, Santa Anna ISD, Santa Fe ISD, Santa Maria ISD, Seagraves ISD, Seguin ISD, Seymour ISD, Shallowater ISD, Shelbyville ISD, Shepard ISD, Shiner ISD, Sierra Blanca ISD, Sinton ISD, Slaton ISD, Smyer ISD, Socorro ISD, Southside ISD, Splendora ISD, Springtown ISD, Spur ISD, Stamford ISD, Sulphur Bluff ISD, Sulphur Springs ISD, Sunray ISD, Tahoka ISD, Taylor ISD, Tenaha ISD, Texline ISD, Thorndale ISD, Throckmorton ISD, Timpson ISD, Tolar ISD, Tornillo ISD, Trenton ISD, Trinidad ISD, Troup ISD, Troy ISD, Tulia ISD, Uvalde CISD, Valley View ISD, Van Alstyne ISD, Van ISD, Venus ISD, Vernon ISD, Warren ISD, Weatherford ISD, Wellman-Union ISD, Wells ISD, West Hardin County CISD, White Oak ISD and Whitesboro ISD

 

Counsel for Alvarado Appellants:

Randall B. Wood                                                                  Trial and Appellate Counsel

State Bar No. 21905000

Doug W. Ray

State Bar No. 16599200

Ray, Wood & Bonilla, L.L.P.

2700 Bee Caves Road #200

Austin, Texas 78746

(512) 328-8877 (Telephone)

(512) 328-1156 (Telecopier)

 

State Appellees:

Shirley Neeley, Texas Commissioner of Education; the Texas Education Agency; Carole Keeton Strayhorn, Texas Comptroller of Public Accounts; and the Texas State Board of Education

 

Trial and Appellate Counsel for Appellees:

R. Ted Cruz, Solicitor General                                           Counsel in Texas Supreme Court

State Bar No. 24001953

Edward D. Burbach, Deputy Attorney General of Litigation

State Bar No. 03355250

Jeff L. Rose, Assistant Attorney General

State Bar No. 00791571

Amy Warr, Assistant Solicitor General

State Bar No. 00795708

Danica Milios, Assistant Solicitor General

State Bar No. 00791261

Merle Hoffman Dover, Assistant Attorney General

State Bar No. 00787706

Joseph Hughes, Assistant Solicitor General

State Bar No. 24007410

Shelley Dahlberg, Assistant Attorney General

State Bar No. 24012491

Office of the Attorney General

P.O. Box 12548 (MC 059)

Austin, Texas 78711

(512) 936-1824 (Telephone)

(512) 474-2697 (Telecopier)

 


 

Edward D. Burbach, Deputy Attorney General for Litigation             Trial Counsel

State Bar No. 03355250

Jeff L. Rose, Assistant Attorney General

State Bar No. 00791571

Robert O’Keefe, Assistant Attorney General

State Bar No. 15240850

Merle Hoffman Dover, Assistant Attorney General

State Bar No. 00787706

William T. Deane, Assistant Attorney General

State Bar No. 05692500

Linda Halpern, Assistant Attorney General

 State Bar No. 24030166

Linda Shaunessy, Assistant Attorney General

State Bar No. 10382920

Kalli Smith, Assistant Attorney General

State Bar No. 24043928

 

Edgewood Intervenors:

Edgewood ISD, Ysleta ISD, Laredo ISD, San Elizario ISD, Socorro ISD, South San Antonio ISD, La Vega ISD, Kenedy ISD, Harlandale ISD, Brownsville ISD, Pharr-San-Juan-Alamo ISD, Sharyland ISD, Monte Alto ISD, Edcouch-Elsa ISD, Los Fresnos ISD, Raymondville ISD, Harlingen ISD, Jim Hogg County ISD, La Feria ISD, Roma ISD, San Benito ISD, and United ISD.

 

Counsel for Edgewood Intervenors:

David G. Hinojosa                                                   Trial and Appellate Counsel

State Bar No. 24010689

Nina Perales

State Bar No. 24005046

 

Leticia Saucedo                                                        Trial Counsel

State Bar No. 00797381

Norma Cantu

State Bar No. 18826900

MALDEF

140 East Houston Street, Suite 300

San Antonio, Texas 78205

(210) 224-5476 (Telephone)

(210) 224-5382 (Telecopier)

 

West Orange Cove Plaintiffs:

West Orange Cove Consolidated Independent School District (“CISD”), Coopell Independent School District (“ISD”), La Porte ISD, Port Neches-Groves ISD, Dallas ISD, Austin ISD, Houston ISD, Alamo Heights ISD, Allen ISD, Argyle ISD, Beckville ISD, Carrollton-Farmers Branch ISD, Carthage ISD, College Station ISD, Cypress-Fairbanks ISD, Darrouzet ISD, Deer Park ISD, Fairfield ISD, Graford ISD, Grapevine-Colleyville ISD, Hallsville ISD, Highland Park ISD, Humble ISD, Katy ISD, Kaufman ISD, Lake Travis ISD, Lewisville ISD, Lubbock ISD, Marble Falls ISD, McCamey ISD, Miami ISD, Northeast ISD, Northside ISD, Northwest ISD, Palo Pinton ISD, Pearland ISD, Plano ISD, Pringle-Morse CISD, Richardson ISD, Round Rock ISD, Round Top-Caramine ISD, Spring Branch ISD, Spring ISD, Stafford Municipal ISD, Sweeny ISD, Terrell ISD, and Texas City ISD.

 

Counsel for West Orange Cove Plaintiffs:

George W. Bramblett, Jr.                                                     Trial and Appellate Counsel

State Bar No. 02867000

Nina Cortell

State Bar No. 04844500

Mark R. Trachtenberg

State Bar No. 24008169

Chip Orr

State Bar No. 00793749

Haynes & Boone, L.L.P.

One Houston Center

1221 McKinney, Suite 2100

Houston, Texas 77010

(214) 651-5000 (Telephone)

(214) 651-5950 (Telecopier)

 

J. David Thompson III

State Bar No. 19950600

Philip Fraissinet

State Bar No. 00793749

Bracewell & Patterson, L.L.P.

711 Louisiana Street, Suite 2900

Houston, Texas 77002-2781

(713) 223-2900 (Telephone)

(713) 221-1212 (Telecopier)

 

Table of Contents

 

Identity of Parties and Counsel                                                                                 i

 

Table of Contents                                                                                                        v

 

Index of Authorities                                                                                                               vi

 

Statement of the Case                                                                                                 4

 

Issue Presented                                                                                                          5

 

1.                  Did the trial court err by failing to hold that the state’s

system for funding school district maintenance and

operations violates the efficiency clause of article VII,

section 1 of the Texas Constitution?                                                      5

 

Statement of Facts                                                                                                       6

 

Summary of the Argument                                                                                       10

 

Argument                                                                                                                    11

 

Conclusion                                                                                                                 15

 

Certificate of Service                                                                                                  17

 

Appendix


 

INDEX OF AUTHORITIES

Cases                                                                                                                          Page

 

Edgewood Indep. Sch. Dist. v. Kirby,

777 S.W.2d 391 (Tex. 1989) (Edgewood I)                                                      11,12

 

Edgewood Indep. Sch. Dist. v. Meno,

917 S.W.2d 717 (Tex. 1995) (Edgewood IV)                                                    6-8, 10-14

 

Webb County v. Board of Sch. Trustees,

95 Tex. 131, 65 S.W. 878 (1901)                                                                       2

 

 

Statutes, Rules and Constitutional Provisions                                                  Page

 

19 Tex. Admin. Code § 62.1071                                                                                  9

 

 Tex. Const., art. VII, § 1                                                                                             4-5, 10-11,

                                                                                                                                         15

 

Tex. Educ. Code Ann. § 41.002                                                                                 7

 

Tex. Educ. Code Ann. § 42.002(b)(1)(A)                                                                 6

 

Tex. Educ. Code Ann. § 41.098                                                                                 9

 

Tex. Educ. Code Ann. § 41.121                                                                                 9

 

Tex. Educ. Code Ann. § 42.101                                                                                 6

 

Tex. Educ. Code Ann. § 42.152                                                                                 8

 

Tex. Educ. Code Ann. § 42.252                                                                                 6

 

Tex. Educ. Code Ann. § 42.253                                                                                 6

 

Tex. Educ. Code Ann. § 42.301                                                                                 6

 

Tex. Educ. Code Ann. § 42.302                                                                                 7

 

Tex. Educ. Code Ann. § 42.303                                                                                 7

 

 

NO. 05-0145

 

In The

Supreme Court of Texas

_______________________________________________

 

ALVARADO INDEPENDENT SCHOOL DISTRICT, et al.,

                                                                                                            Appellants

 

V.

 

SHIRLEY NEELEY, IN HER OFFICIAL CAPACITY AS TEXAS COMMISSIONEROF EDUCATION, THE TEXAS EDUCATION AGENCY,

CAROL KEETON STRAYHORN, IN HER OFFICIAL CAPACITY

AS TEXAS COMPTROLLER OF PUBLIC ACCOUNTS, AND

THE TEXAS STATE BOARD OF EDUCATION,  

                                                                        Appellees

_______________________________________________

 

On Direct Appeal from the 250th District Court, Austin, Travis County, Texas

_______________________________________________

 

ALVARADO APPELLANTS’ BRIEF

_______________________________________________

 

To The Honorable Supreme Court of Texas:

In 1996, a former legislator intimately familiar with school finance issues presciently foretold the filing of this suit and the reasons for its necessity.  She stated that “’[t]here will be a challenge within the next ten years, because I don't think our system will stay equitable because we rely on the property tax. . . . Our system depends on its being fully funded . . . but historically, the Legislature has started backing away. When that happens, it's going to get out of kilter and there will be another lawsuit.’”  J. Steven Farr & Mark Trachtenberg, The Edgewood Drama: An Epic Quest for Education Equity, 17 Yale L. & Pol’y Rev. 607, 723 (1999) (quoting an interview with Libby Linebarger, Former Chairperson of the House Committee on Public Education, in Austin, Tex. (Mar. 20, 1996)).  Property poor districts seek redress from a system that has fallen into inequity as a result of funding cuts that fall disproportionately on them. 

For the first time in the history of Texas school finance litigation, however, every school district party has lined up on the same side of the docket.  No district stands with the State in trying to uphold the constitutionality of the present system, and equity is the reason.  While there are many other issues that will be brought to this Court for decision in connection with this matter, equity is the key.

            As this Court long ago observed, the Constitution “devolves the duty of establishing and maintaining public free schools upon the legislature.”  Webb County v. Board of Sch. Trustees, 95 Tex. 131, 137, 65 S.W. 878, 880 (1901).  Because the Legislature holds the purse strings, it is through that political institution that education will be funded and the public free schools maintained.  To that end, it is equity among school districts that has united them in a common demand of this State’s political leaders for a better educational system.  It is thus equity that will sustain the movement towards a better education for all Texas children and it is for this reason that the Alvarado Appellants have brought this appeal to ensure equity in all aspects of school funding.


 

STATEMENT OF THE CASE

            Nature of the Case:  Alvarado Appellants intervened in this case, originally filed in the 250th District Court of Travis County, and sued the State seeking a declaration that its system for financing school districts violated the efficiency, adequacy and suitability clauses of Article VII, section 1 of the Texas Constitution.

            Course of the Proceedings.  A trial to the court was held in this case between August 9, 2004 and September 15, 2004.

            Disposition of the Case:  On November 30, 2004, Judge John Deitz granted judgment for Alvarado Appellants on every cause of action except the claim that the funding of school district operations is unconstitutionally inequitable.  3 CR 843, 848; FOF 435, 4 CR 943.  The Edgewood Appellants and the Alvarado Appellants timely filed post-judgment motions on December 29, 2004. 4 CR 1002, 1020.  These motions were overruled by operation of law and the Alvarado Appellants timely filed their direct appeal to this Court on February 28, 2005.  4 CR 1119A-1.


 

ISSUE PRESENTED

1.         Did the trial court err by failing to hold that the state’s system for funding school district maintenance and operations violates the efficiency clause of article VII, section 1 of the Texas Constitution?

 

 

 


 

STATEMENT OF FACTS

            The current structure for financing school district operations is essentially unchanged from the time this Court reviewed the system in Edgewood Indep. Sch. Dist. v. Meno, 917 S.W.2d 717 (Tex. 1995) (Edgewood IV).  The Foundation School Program funds operations through a two-tiered system.  The purpose of Tier 1 is to provide “sufficient financing for all school districts to provide a basic program of education that is rated academically acceptable or higher. . . and meets other applicable legal standards.”  Tex. Educ. Code Ann. § 42.002(b)(1)(A).  Each district is entitled to a basic allotment of $2,537 for each student in average daily attendance, subject to various adjustments.  Id. § 42.101.  Once a district raises its local share of funding, defined as the amount produced by an effective tax rate of $.86 as applied to its prior year values, then it is entitled to the total amount of its adjusted allotment and the State will make up any funds not produced by the district’s local tax effort.  Id. §§ 42.252-.253.

Tier 2 consists of a guaranteed yield system that is to supplement a school district’s basic “program at a level of its own choice, [which funds] may be used for any legal purpose other than capital outlay or debt service.”  Id. § 42.301.  For every cent of a district’s additional tax effort between $.86 and $1.50, the State guarantees a yield of $27.14 per weighted student and makes up the difference between what is guaranteed and what the district’s local tax base produces.  Id. §§ 42.253, .302-.303.

As originally enacted, the present school finance system would have limited every school district to accessing $280,000 of its property wealth per weighted student after a three-year transition period for those districts that required greater amounts of property wealth to maintain their 1992-93 funding levels.  Edgewood IV, 917 S.W.2d at 734.  Looking at the system as it would be when fully implemented, between property wealthy and property poor districts there existed a 9 cent tax rate disparity in the tax rate necessary to raise $3,500 per weighted student, which was the presumed amount of operations funds needed for a general diffusion of knowledge.  Id. at 731.  

  While the Legislature has raised the wealth cap to $305,000 per weighted student, it also eliminated the transition period so that certain school districts are allowed to access wealth in excess of the cap in perpetuity.  Tex. Educ. Code Ann. § 41.002.[1]  Moreover, the formulas for determining the excess amount of wealth these districts can access provide that each time the wealth cap is raised then their amount of allowable excess is increased by an equal percentage.  Id.; 16 RR 16, 64-66.  As a consequence, there are school districts who are able to access over twice as much as the $305,000 cap would allow, State Ex. 16053 at 1, and the average of all hold harmless districts stands at $421,373 per weighted student, which gives these districts an average of $115,000 in additional value per student.  ALV Ex. 9008 at 1.  This legislative action increased the tax rate gap for funding operations over what was previously allowed.

Additionally, since the decision in Edgewood IV, the Legislature has taken other steps that have increased the operations tax rate gap.  The Legislature has tripled the amount by which it reduces the state aid for compensatory education allotments provided for by section 42.152 of the Education Code.  ALV Ex. 9004 at 5.[2]  These monies (called set-asides) are used to fund particular programs primarily for students eligible for free and reduced lunch.  Tex. Educ. code Ann. § 42.152; 16 RR 17.  However, because these funds are deducted only from funds that would otherwise go to Tier 2 and gap districts, but not from Chapter 41 districts, the increase in these set asides has further increased the operations tax rate gap between property rich and property poor districts.  ALV Ex. 9004 at 5; 16 RR 20-21.

The Legislature also enacted two credits that allow Chapter 41 districts to significantly reduce their recapture, which further exacerbates the operations tax rate gap.  The early agreement credit allows Chapter 41 districts to deduct 4% or $80 per student, whichever is less, from their recapture by entering into an agreement by September 1st of each year.  Tex. Educ. Code Ann. § 41.098.  The efficiency credit allows Chapter 41 districts to deduct 5% or $100 per student, whichever is less, from recapture for sending its recapture directly to a Chapter 42 district rather than the StateId. § 41.121; 19 Tex. Admin. Code § 62.1071.  This credit requires only that an accredited Chapter 42 district spend less than the contributing Chapter 41 district and agree to spend its recapture funds on programs approved by the Commissioner of Education.  Id.  The total impact of these and other actions taken by the Legislature has been to increase the operations tax rate gap to 17 cents to reach a revenue level of $4,274 per weighted student (the maximum amount available at a $1.50 tax rate for Tier 2 districts), which is less than what is actually required to provide a general diffusion of knowledge.  State Ex. 16429 at 55; 28 RR 51-52; FOF 291, 4 CR 919.


 

SUMMARY OF THE ARGUMENT

            According to this Court, upon full implementation the system created by Senate Bill 7 would have been equitable enough to only be barely constitutional.  That system, however, was never fully implemented and has been changed since this Court’s Edgewood IV opinion in ways that have made it less equitable.  Thus, there now exists a greater disparity in access to revenues than this Court found just tolerable in Edgewood IV. Because the State has retreated on the efficiency of the system rather than moving forward and making it more equitable, the funding of school districts’ maintenance and operations has become constitutionally inefficient in violation of article VII, section 1 of the Texas Constitution.


 

ARGUMENT

            “A general diffusion of knowledge being essential to the preservation of the liberties and rights of the people, it shall be the duty of the Legislature of the State to establish and make suitable provision for the support and maintenance of an efficient system of public free schools.” Tex. Const. art. VII, § 1.  Starting with this Court’s opinion in the original Edgewood case, equity has become an integral part of the “efficient” system of public education mandated by the Texas Constitution.  See Edgewood Indep. Sch. Dist. v. Kirby, 777 S.W.2d 391, 395-98 (Tex. 1989).  In reviewing constitutional debates, legislative enactments, gubernatorial pronouncements and prior court opinions, it becomes clear that at bottom efficiency requires an equality of educational opportunity for each and every child in this State irrespective of where they live.  Id.  Although it took over 100 years and three Supreme Court opinions, the system was headed in the right direction for ensuring educational equity,  see Edgewood IV, 917 S.W.2d at 725-26, but it has now taken a turn back towards greater inequality among the school children of Texas.  Consequently, this Court should declare the maintenance and operations funding for school districts to be unconstitutionally inefficient and provide the Legislature with an opportunity to equalize the system.

            The constitutional mandate for efficiency requires “that the funds available for education be distributed equitably and evenly.”  Edgewood I, 777 S.W.2d at 398.  Such an allocation of education funds is necessary to achieve the “general welfare of all, rich and poor, male and female,” that flows from putting a quality education “within the reach of every child in the State.”  Id. at 395 (quoting S. McKay, Debates in the Texas Constitutional Convention of 1875 198 (1930)).  When a system relies heavily on local property taxes, realizing this equality requires that each and every school district be able to obtain “substantially equal revenue for substantially equal tax effort” as needed to raise those funds required to provide their children with an adequate education.  Edgewood IV, 917 S.W.2d at 730.

            In Edgewood IV, this Court reviewed the constitutionality of the system implemented by Senate Bill 7.  After a three-year phase in, that system would have capped property-wealthy school districts at $280,000 of wealth per weighted student and provided property-poor districts with a Tier 1 basic allotment of $2,300 and a guaranteed yield of $20.55 per weighted student.  Edgewood IV, 917 S.W.2d at 727-28, 734.  Reviewing the constitutionality of the system as if it were fully implemented, the Court noted the progress achieved by the Legislature and held that Senate Bill 7 was barely constitutional.

            As evidence of the improvement, the Court noted that the disparity in access to funds under Tiers 1 and 2 was 1.36 to 1, representing the ratio of $28 per weighted student for the richest districts to the guaranteed yield of $20.55 per weighted student for the poorest districts.  Id. at 731.  Based upon this ratio, Edgewood IV concluded that “[c]hildren who live in property-poor districts and children who live in property-rich districts now have substantially equal access to the funds necessary for a general diffusion of knowledge.”  Id.  The Court also found that the tax rate differential to provide a general diffusion of knowledge[3] was 9 cents between the top and bottom 15% of districts.  Id.  This particular “existing disparity in access to revenue” was held to be “not so great that it renders Senate Bill 7 unconstitutional.”  Id. at 732.

            Despite these advances in equity and the opinion’s upholding the constitutionality of the system, the Court stressed that Senate Bill 7 was “minimally acceptable only when viewed through the prism of history.”  Id. at 726.  Thus, while the disparities noted by the Court were not so great as to render the system unconstitutional, that was only because the State had substantially advanced towards the goal of evenly and equitably distributing educational funds. The State had not yet reached the actual goal of a fully efficient system, rather, as the Court admonished, “Texas can and must do better.”  Id.

But rather than doing better, the State has done worse on both of these measures.  By failing to fully implement Senate Bill 7 and by providing additional funds to wealthy districts, the disparity in access to funds under Tiers 1 and 2 is now 2.25 to 1.[4]  This is approximately a 350% increase in inequity over what the Court pointed to as scarcely tolerable in Edgewood IV.  Likewise, the gap between the tax rates needed by the richest and poorest districts to currently provide an amount of revenue sufficient to provide a general diffusion of knowledge[5] has at least doubled.  Using the average of all Chapter 41 districts, rather then the just the top 15%, the tax rate gap has increased from 9 cents to 17 cents.  State Ex. 16429 at 55; 28 RR 51-52.  If just the top 15% of Chapter 41 districts were included in calculating this gap, it would undoubtedly be larger.   

 Based upon this retreat from equity, it is clear that the current system is no longer even minimally acceptable.  Moreover, while the ratios tell the story of inequity, they do not reveal how that inequity plays out in schools across this State.  With a 2 to 1 advantage in accessing funds a school district can afford to hire more and better qualified teachers, provide needed programs and be better equipped to provide students the tools they need to participate fully in the available social, economic and educational opportunities.  As recognized by the framers of our Constitution and this Court’s prior opinions, it is a matter of utmost importance to this State, as well as a matter of common decency, that Texas not create large disparities between the educational opportunities available to its children.  It is upon this basis that the current system violates the efficiency clause of Article VII, section 1 of the Texas Constitution.

CONCLUSION

            Based upon the foregoing, the Alvarado Appellants respectfully request this Court to reverse the trial court’s judgment and render judgment that the current school finance system violates the efficiency clause of Article VII, section 1 in the manner that it funds the maintenance and operations of Texas school districts.


 

                                                                        Respectfully submitted,

 

                                                            RAY, WOOD & BONILLA, L.L.P.

 

 

                                                                        By:______________________________

                                                                                    Doug W. Ray

                                                                                    State Bar No. 16599200

                                                                                    Randall B. Wood

                                                                                    State Bar No. 21905000

                                                                        P.O. Box 165001

Austin, Texas 78716-5001

(512) 328-8877

                                                                        (512) 328-1156 (Telecopier)

                                                                        ATTORNEYS FOR ALVARADO

APPELLANTS


 

CERTIFICATE OF SERVICE

 

            I hereby certify that a true and correct copy of the above and foregoing Alvarado Appellants’ Brief has been sent via Certified Mail, Return Receipt Requested, to the following:

 

George W. Bramblett, Jr.

Mark R. Trachtenberg

Nina Cortell

Chip Orr

Haynes & Boone, L.L.P.

901 Main Street, Suite 3100

Dallas, Texas 75202-3789

 

Edward D. Burbach

Deputy Attorney General for Litigation

R. Ted Cruz

Solicitor General

Amy Warr

Assistant Solicitor General

Danica L. Milios

Assistant Solicitor General

Office of the Texas Attorney General

Attorney General’s Office

300 West 15th Street; 11th Floor

Austin, Texas 78701

 

Nina Perales

David G. Hinojosa

MALDEF

140 E. Houston Street, Suite 300

San Antonio, Texas 78205

 

 

 

J. David Thompson, III

Philip Fraissinet

Bracewell & Patterson, L.L.P.

711 Louisiana Street, Suite 2900

Houston, Texas 77002-2781

 

 

 

on this the ______ day of April, 2005.

 

                                                                   _________________________

                                                                   Doug W. Ray

F:\clients\08046\00002\Appellants-Brief


 

[1] Those districts that have a wealth level exceeding $305,000 are referred to as Chapter 41 districts.  Districts that receive money under the Tier 2 guaranteed yield are referred to as Tier 2 districts and those districts that meet neither of these conditions are referred to as gap districts.

[2] Although the report contained in this exhibit expresses this gap as a dollar figure, any increase in the revenue gap between districts proportionally increases the tax rate gap, as they are simply a function of each other.  28 RR 107.

[3] The opinion presumed that an accredited program was sufficient to provide a general diffusion of knowledge and cited testimony that an accredited program could be achieved with $3,500 per weighted student.  Id. at 730-31 & n.10.

[4] This result comes from comparing the approximately $61.13 per weighted student available to the richest districts, see State Ex. 16053 at 1, with the $27.14 guaranteed yield.

[5] The trial court found that the Chapter 41 districts in the West Orange-Cove plaintiff group could not provide an adequate education at a $1.50 tax rate. FOF 291, 4 CR 919.  Because Tier 2 districts can raise even less than these districts at the maximum rate, the maximum amount of revenue available to Tier 2 districts is actually insufficient to provide a general diffusion of knowledge.  However, because these districts cannot obtain any greater amount of revenue under the current system, that is the appropriate amount of revenue to calculate the tax rate gap.