Gannon vs. Kansas: a Love Story, Part II

As I’m writing this, the Kansas legislature is embroiled in a significant debate about ensuring that the state’s public school system is equitable. If you’d like to know how we arrived at this point, here is part one of the story, going all the way back to the Montoy litigation.

On May 27, 2016, the Kansas Supreme Court issued its ruling in Gannon III, the latest in a long line of school finance cases. The entire ruling can be found here. Remember from Part I, the equity standard is,

“School districts must have reasonably equal access to substantially similar educational opportunity through similar tax effort.” (Emphasis mine).

The entire decision and associated remedies must meet that standard, otherwise students in Kansas will not be in school come August.

The ruling did several things. The Court found that the legislature’s fix cured inequity in the capital outlay funding, but did not cure inequity in the supplemental state LOB aid. Additionally, the Court found the headline “hold harmless” provision, that protects every school district, especially wealthy ones, from cuts when the existing funds are redistributed to poorer districts, unconstitutional. The extraordinary need fund, that prevents catastrophic cuts to districts due to oddities in their enrollment demographics, is not sufficient to cure inequities in the LOB system either per the Court’s ruling.

The most controversial part of the ruling is a very technical legal concept called severability. If a piece of a statute is severable (e.g. the supplemental LOB provisions in the block grant statute), part of it can be struck down and the rest of the statute can stand. The Court expands:

If from examination of a statute it can be said that [1] the act would have been passed without the objectionable portion and [2] if the statute would operate effectively to carry out the intention of the legislature with such portion stricken, the remainder of the valid law will stand.”

The Court ruled that the LOB provisions are not severable, as the statute could not operate without the parts that are not up to constitutional muster. Without the estimated $1 billion in LOB funding, the CLASS Act (the current funding system) could not operate for several reasons. First, without the LOB Aid, the law clearly does not meet Article 6 obligations to provide “suitable provision for finance of the educational interests of the State” (Article 6,§ 6 of the Kansas Constitution) Perhaps most notably, the Court ruled that if the legislature did not enact a remedy, then schools would be forced to close on June 30th.

This court-imposed deadline created the most hostility among the three branches of government. Speaker of the House Ray Merrick (R-Stillwell) spoke for a majority of Republicans when he said this about the Court,

The Kansas Supreme Court has made their desire to close Kansas schools crystal clear. Their willingness to use Kansas children for their own political gain is despicable. Despite the Court’s attempts to stir up fear, it’s not going to happen. During the upcoming special session Republicans will ensure that schools remain open while at the same time upholding the Kansas constitution and not bowing to judicial overreach.

From the court’s perspective, they had no other choice. Even though the LOB aid portion of the formula encompasses less than 1% of total education spending, the mere existence of this inequitable system creates an untenable civil rights situation where there isn’t (here we go again) “reasonably equal access to substantially similar educational opportunity through similar tax effort.” In the ruling, the Court suggested, though didn’t demand, a return to the old equalization formula, where some, wealthier districts lose some aid and property poor districts gain aid, all at a total of $38 million.

Before any plan came together to fix equity, Senate leadership wanted to vote on a constitutional amendment to ensure that a fund-or-close situation never occurred again. It’s solution was SCR 1602, which had the effect of barring the Supreme Court, or any court, from closing schools in the event that a funding formula was found unconstitutional. Conservatives said the amendment was necessary to rein in an “activist court.”

The process for passing a constitutional amendment in Kansas is simple. Each chamber must pass the amendment by a 2/3 majority, then a simple majority of voters must vote for passage on the general election ballot. This means 27/40 Senators and 84/125 House members must vote for passage. The vote failed narrowly in the Senate, 26–13. Voters will not have the chance to weigh in on the issue until a much later date.

Legislative leadership was content to pass the plan the Court suggested. It would be a challenge, however, to find the $38 million necessary to fund the additional aid. There were many proposals bandied about, including additional cuts to higher education, a .5% cut in operating budgets to all schools, additional revenue from the large tobacco settlement, the use of idle TANF (temporary assistance to needy families) funds, cuts to the large job creation fund (essentially a fund to lure companies to Kansas via tax incentives), cuts to virtual school aid, and a reduction in the extraordinary needs fund.

By June 24th, three plans emerged. The leadership’s preferred option, dubbed the “conservative plan” funded LOB aid by the full $38 million. It included a .5% cut to USD’s operating budgets, a $2.8 million cut to virtual schools, a $7.2 million cut to the extraordinary need fund, a sweep of $4.1 million in idle TANF funds, an extra $10.5 million in tobacco settlement funds. Perhaps most importantly, three school superintendents from suburban Johnson County districts supported the plan, giving members some political cover. Early on in the day, it became abundantly clear that there weren’t 63 votes in the House to pass this plan. Many took issue with the .5% cut to operating budgets, and threatened to scuttle the bill. Their rationale was in the Court’s ruling, that the legislature could not harm adequacy when fixing equity. Slicing operating budgets certainly does that. So where do we go from here?

Plan number two came from the endangered species known as legislative Democrats. The headline number was the same, around $38 million, but Democrats got there differently. They kept the freeze on virtual aid, the equalization fund, and the TANF sweep, but also repealed the tax credit for private school scholarships, good for $750,000, and swept $13 million from the job creation fund. In their rush to defend corporate welfare, GOP leadership declared the plan dead on arrival,

“While it’s nice that Democrats finally came up with an idea other than voting no, their plain would force the state of Kansas to break binding commitments already made with job creators, which is at odds with their claims of support for working Kansans.”

A third plan came about, spearheaded by Rep. Melissa Rooker (R-Fairway), a moderate and former member of the education committee. The “moderate plan” as it came to be known in the halls of the Capitol, was a hybrid of the Democratic and Republican plans. Moderates were very concerned about the cuts to operating budgets, so their plan found other cuts to avoid the .5% cut. It kept the virtual school freeze, in this case worth $3 million, and the TANF sweep. It differed in a couple important ways. It split the difference in the job creation fund, sweeping only $6 million. It cut Children’s Initiative Funds by $16 million, and diverted $9 million in motor registration fees originally earmarked for road construction to LOB aid. From my own discussions, I gleaned that this plan probably had the support of a majority of rank-and-file members, but not from leadership. All in all, no plan had the critical mass of support to pass. So committees went back to the drawing board.

The committee plan split the difference between conservative and moderate Republicans, and found some new revenue as well. In 2015, the Kansas Bioscience Authority Board of Directors voted to privatize in the face of reduced state funding and increased state scrutiny. The state was banking on selling off the agency for at least $25 million. Any additional funding was earmarked for the general fund. Lawmakers on the House Appropriations Committee discovered a gold mine. They earmarked up to $13 million (above and beyond the $25 million price tag) for schools. Additionally, the new compromise plan kept the virtual adjustment of $2.8 million, the extraordinary need fund cut of $7.2 million, the TANF sweep, and the $10.5 million in tobacco settlement funds. This plan passed the House 116–6 and the Senate 38–1. Governor Sam Brownback has announced he will sign the bill, and Kansas schools will continue to operate passed June 30th.

There, have it all? Good. Here ends the story of Gannon III. Are we out of the woods yet? Of course not. That is a discussion for another day. In the concluding post, I’ll explain how I would’ve solved the situation had I had a magic wand. (Hint: I may be the only person on Earth who likes it. Maybe that makes it a good plan? Or I may be insane.) It’s up to you to decide!

One clap, two clap, three clap, forty?

By clapping more or less, you can signal to us which stories really stand out.