State of Arizona sued over capital funding cuts - AZEdNews
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State of Arizona sued over capital funding cuts

First-graders In Maddy O'Connor's Class At Landmark Elementary School Take Part In A Discussion. Photo By Lisa Irish/AZEdNews

Four Arizona public school districts and education advocates filed a lawsuit Monday against the State of Arizona and the School Facilities Board for inadequate capital funding after lawmakers cut $2 billion since 2009 from the funds schools use to maintain buildings, buses, textbooks and technology to balance the state budget.

“We’ve waited far too long for our policymakers to fund public education and unfortunately, we’re in a situation now that we can no longer be patient,” said Mike Barragan, associate superintendent of Glendale Elementary School District, one of the plaintiffs in the lawsuit.

Video by Brooke Razo/Arizona School Boards Association: Capital Lawsuit Plaintiffs Speak Up

Arizona Gov. Doug Ducey is focused on the Arizona Legislature approving a new state budget and has no immediate comment on the issue, said Daniel Scarpinato, media spokesman for the governor in an Arizona Capitol Media article. In past years, Ducey’s budget proposals have not fully funded capital funding, and the governor proposed $17 million in capital funding for schools this year.

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This short retaining wall at Landmark Elementary School was put in place to remedy structural deficiencies. Photo by Lisa Irish/AZEdNews

“In Glendale in particular, we’ve lost about $29 million in capital funding since 2009,” Barragan said before a news conference held by the plaintiffs at Landmark Elementary School in Glendale. “When you cut $29 million, we cannot expect not to have unexpected consequences. We believe we need to advocate for the over 1 million students who have chosen to attend traditional public schools.”

Landmark was one of the two Glendale schools that were closed for repairs in September 2016 after structural deficiencies were found during a weatherization project and further assessments showed damage to outside walls on all buildings on each campus. Students at Landmark Elementary School and Challenger Middle School returned to their campuses when repairs were complete in October.

“This represents what happens when you don’t fund capital funding,” Barragan said.

Glendale district administrators had expressed concerns about deferred maintenance projects for schools in July to The Arizona Republic, some of which included Challenger and Landmark schools, due to strained resources from state cuts to capital funding.

The plaintiff group includes the Glendale Elementary School District, Chino Valley Unified School District, Crane and Elfrida elementary school districts, Arizona School Boards Association, Arizona Education Association, Arizona School Administrators, Arizona Association of School Business Officials, and Kathy Knecht of Peoria and Jill Barragan of Laveen.

Attorneys Tim Hogan from the Arizona Center for Law in the Public Interest and Mary R. O’Grady from Osborn Maledon represent the plaintiffs.

“The legislature’s finance system is unconstitutional, because it is not general and uniform as required by article 11 section 1 of the Arizona constitution,” Hogan said at the press conference.

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Right click for larger chart. Chart courtesy of ASBA

The state is required to provide the funding for all schools, buildings, facilities and equipment to meet minimum adequacy standards, and “the state is no longer doing that,” Hogan said.

“As a result we have many school districts, some of which are represented here today, who have buildings and facilities that fail to meet the minimum adequacy standards established by the state almost 20 years ago,” Hogan said.

“We also have school districts, also represented in this group, who have asked their taxpayers to approve bond issuances to take care of problems within their school districts, and so as a result we’ve got individual taxpayers now paying for things to correct school facilities that the state should be paying for,” Hogan said.

As state funding for Arizona’s K-12 public schools has declined from 49 percent in 2006 to 39 percent in 2016, local funding has become increasingly critical for schools.

These cuts in capital funding, which the state calls district additional assistance, have been one of the main factors in many school district’s decisions to seek more local funding by putting bonds and overrides on the ballot.

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Chart courtesy ASBA

This year, 20 percent of Arizona’s 223 public school districts had bond or override measures on the ballot because of declining state funding that has made it difficult for districts to maintain class sizes, increase teacher salaries and upgrade technology to meet state testing needs.

Along  with the cuts to capital funding, the Arizona Legislature has also significantly reduced money for building of new schools and major school repairs through the School Facilities Board, passing these costs along to school districts who often must ask for funding for these needs from local taxpayers through bond elections.

It is difficult to estimate how much districts have spent to build the new schools the Schools Finance Board has not funded, but the building renewal formula has been cut $256 million since 2009, based on 2008 funding levels, said Heidi Vega, communications director for the Arizona School Boards Association.

“We’re at 1993 funding levels in terms of capital, and in the current budget from the governor’s office there’s no district additional assistance,” said Dr. Mark Joraanstad, executive director of Arizona School Administrators. “So we’ve really after 25 years been left with no real alternative, I think, but putting some pressure on, which we hope maybe will result in a change of heart.”

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Chart courtesy ASBA

10:30 a.m. May 1, 2017

Before the news conference, Laurie Doering, assistant superintendent for Crane Elementary School District in Yuma, talked about what led her district to take part in the lawsuit.

“The state has cut approximately 90 percent of our capital funding over the past 10 years, and we’ve had to make some difficult decisions in our capital budget,” Doering said.

Those decisions have affected building maintenance, transportation costs, as well as textbooks and technology.

The cuts have hit transportation particularly hard, said Dale Ponder, executive director of management services for Crane Elementary.

“The useful life of a bus is about 20 years and out of our 35 buses, 22 of those exceed 100,000 miles currently, some of them are 200,000 miles,” Ponder said. “We have some buses from 1991. Through support for our bond, we were able to replace nine of those buses, so some of them are new, but it fell on the backs of our taxpayers in lieu of something the state should have been contributing for.”

Ponder also noted that Crane Elementary School District was one of the original plaintiffs in the lawsuit that ultimately came from Students First in the early 1990s.

“We felt it was something we wanted to continue to be a part of,” Ponder said. “We are equally sufferring from the lack of capital funding that we receive, but we also felt a historical need to be a part and see it though again.”

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Students on the playground at Landmark Elementary. Photo Lisa Irish/AZEdNews

Jill Barragan, who lives in Laveen, said she’s tired of the cuts to capital funding.

“I have a son who’s a sophomore in high school and hasn’t been fully funded since first grade, and I have a daughter in second grade and she’s never been fully funded,” Jill Barragan said.

She said she’d like to see capital funding for schools restored.

“In my district where we live in Laveen, we’ve had to increase the taxpayers tax bill through bonds and overrides,” Barragan said. “It’s not the burden of a local taxpayer, it should be shared statewide. That is what our equalization formula is about.”

Kathy Knecht, a Peoria resident and former president of the board of directors of Arizona School Boards Association, said she often hears local residents ask why their property taxes are increasing.

“Our state has an obligation to maintain and keep our schools quality, and they’re not doing it,” said Knecht, who plans to run against Sen. Debbie Lesko in the next election. “We’re worried as homeowners as taxpayers. Funding has been cut. We want to provide quality schools for our kids, for our neighborhoods and for our property values so we keep being asked as local taxpayers to maintain that when really the obligation is with the state.”

Crane Elementary Superintendent Robert Klee said, “If you look at any of the national polls or surveys, Arizona is consistently in the bottom for funding for public education. These kids are our future. We not only have a constitutional obligation, we have an ethical obligation, to provide the very best education we can, and we’re not doing it right now.”

“It’s time for us to pay it forward. Previous generations paid it forward for us,” Klee said. “We all have good jobs, and now it’s time for us to man up and pay it forward.”

11:00 a.m. press conference on Monday May 1, 2017

“The legislature’s finance system is unconstitutional, because it is not general and uniform as required by article 11 section 1 of the Arizona constitution,” Hogan said at the press conference. “We know what general and uniform means, because the state supreme court has said many times, a number of years ago when we first litigated these issues, what a general and uniform school system as far as school buildings, facilities and equipment requires. It requires the state to provide the funding for all schools, buildings, facilites and equipment to meet minimum adequacy standards. The state is no longer doing that.”

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Tim Hogan speaks at the press conference with school representatives and education advocates standing in front of Landmark Elementary in Glendale. Photo by Heidi Vega/ASBA

“As a result we have many school districts, some of which are represented here today, who have buildings and facilities that fail to meet the minimum adequacy standards established by the state almost 20 years ago,” Hogan said. “We also have school districts, also represented in this group, who have asked their taxpayers to approve bond issuances to take care of problems within their school districts and so as a result we’ve got individual taxpayers now paying for things to correct school facilities that the state should be paying for.”

“It’s not as if the state does not know how to do this correctly,” Hogan said at the press conference. “When we filed litigation originally about this issue in 1991 and won a supreme court decision in 1994, the state, ultimately, in active legislation in 1998 called Students FIRST provided a number of funding sources for  school districts to take care of their buildings and facilities issues. They spent $1.2 billion to bring all schools and buildings up to standards at that time, and then provided funding on an ongoing basis for school districts to maintain those buildings and facilities at minimum standards.”

“One of those sources of funding was the building renewal formula,” Hogan said. “That was intended to provide funding to school districts to take care of major renovations and the other was soft capital, which provided funding on an annual basis for school districts so they could fund short-term capital items like textbooks and technology.”

“The building renewal formula, which provided the bulk of the funding, was only fully funded in one year after Students First was enacted,” Hogan said. “And in 2008, the state stopped funding it completely, and then in 2013, repealed the building renewal formula.”

The soft capital funding for shorter term capital items was funded up until 2013, when the state took capital outlay funding, cut it in half and renamed it district additional assistance, Hogan said.

“Were those funding sources in effect today, it would provide approximately $300 million annually to school districts to address their capital needs as far as their buildings and facilities go,” Hogan said.

Hogan noted that the way school finance is structured today state funding is all Maintenance and Operations school budget money and if school districts use any of that for capital needs it impacts their school operations – class sizes, teacher pay and many other important items.

“As a result we have some school districts dipping into that M&O to take care of some very serious problems and that impacts students,” Hogan said.

Hogan noted school districts are “in exactly the same position we were in in 1991 when we originally filed this lawsuit.”

“That’s an unfair system to schools, it’s unfair to students and it’s unfair to taxpayers,” Hogan said.

11:10 a.m. questions from reporters

A reporter then asked Hogan, “How long do you think it’s going to take to resolve this lawsuit?”

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Student projects line the hallway at Landmark Elementary.

Tim Hogan replied, “Well, hopefully, because of the fact that we have a supreme court decision that spells out the state’s responsibilities it won’t take as long as it did the previous time in the 1990s. You’ll recall it took us approximately four years to get to the point where the legislature enacted Students First and provided the necessary funding at least initially.”

Another reporter asked Hogan, “What’s your message to the governor?”

Hogan replied, “I think that the governor should show some leadership here especially helping narrow out how inadequately funded education is in Arizona. We’re last in the country or close to last in everything. This is a problem here and it’s a constitutional requirement and so we need some leadership to direct the legislature to solve this problem. There are lots of different ways to solve this problem. The one that they chose in 1998 was one of them, but there are many others.”

A different reporter said, “Legislative leaders have previously used the argument that under the constitution the legislature has sole authority to determine spending and therefore neither the voters nor the courts have authority to spend anything like this.”

Tim Hogan replied, “I think the supreme court and their previous decisions say otherwise. That argument was raised in court in past litigation, but in the 1990s it was denied and I don’t believe the outcome would be any different today. It’s a constitutional requirement and its something the courts enforce.”

Then another reporter said “You said the governor needs to provide leadership, we spoke with him a few moments ago and we asked him about this issue and he said, Look I’m proposing an additional $17 million for capital funding.”

Hogan replied that “$17 million is trivial in the overall capital needs that schools have in Arizona. The school district that we’re at – Glendale Elementary – has capital needs in the $50 million range, immediately, which would take care of that $17 million and then some.”

Hogan also noted that “school districts issue bonds annually in the neighborhood of $300 to $500 million to address capital needs.”

A different reporter said “So school districts are using money to currently cover their capital needs, some might argue why should the legislature.”

“Because the constitution requires the state to provide the money, not the local taxpayers and in fact the supreme court explicitly said that the state cannot hand off it’s funding obligations to local taxpayers. Otherwise, you end up with an inequitable system, which is what the supreme court condemned  – a school finance system that’s overly reliant on property taxes.”

11:20 a.m. school administrators talk about cuts affect on their schools

Restoring capital funding is long overdue, said Mike Barragan, assistant superintendent of Glendale Elementary School District.

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Students in the hallway at Landmark Elementary.

“When you don’t fund $2 billion of capital funding statewide, there are unintended consequences,” Barragan said. “That’s a reality, and we faced that earlier in the year. We had to close two schools (for repairs). It’s an unfortunate situation to be in. Earlier in the year, we had some structural deficiencies, we had to bring in some architects to add some support walls around the schools.”

“We hope our state leaders understand the severity of these issues,” Barragan said.

John Scholl, superintendent of Chino Valley Unified School District, said transportation was more of an issue at his school.

“Annually, we get about $263,000 in capital funding, and that’s to cover books and buses and computers,” Scholl said. “Right now a textbook adoption for us is between $250,000 and $300,000 and we’ve done one in the last seven years since I’ve been in the district office. A bus costs anywhere from $135,000 to $150,000. We have 31 buses, two of those are from 1980 that are still on the road,’

“We just don’t have the capital to function as a school district,” Scholl said. “It’s becoming critical, especially to our transportation side. We recently borrowed a bus for an extended period of time from a neighboring school district because we didn’t have enough functioning buses to get our kids to school and back home.”

Noon after the press conference

Schools in Chino Valley Unified have had some structural deficiencies, “but we are managing,” School said.

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The walkway at Landmark Elementary. Photo by Lisa Irish/AZEdNews

“We’ve done some things in the interim like energy savings projects to replace some of those HVAC,”Scholl said. “We’ve taken advantage of all the programs we can and even the School Facilities Board has helped us out when possible, but they don’t do anything with buses.”

The schools serve students in the 400-square-mile area of Chino Valley and Paulden, a community about 10 to 15 miles to the north, Scholl said.

“Busing is vital to getting those kids,” Scholl said.  “If we don’t provide the transportation, it may be difficult for those families to get them to school.”

Scholl noted that recent mechanical issues with some buses caused them to double up some routes which is not ideal for students or bus drivers.

“We had to borrow a bus. We had to cancel a middle school athletic event, because getting the kids to and from home is our priority,” Scholl said. “The last thing we want to do is cancel field trips or cancel things that enhance the educational experience for these kids.”

School said the district gets most of their computers from surplus from Yavapai College and Yavapai County.

“What they’re surplusing is better than what we have in our classrooms and our labs, so we’ll take it and replace our equipment,” Scholl said.

But he noted that it’s not the most up-to-date technology, and that when you’re using it to test students “can get in the way of assessing those kids so we’re not getting a realistic view of where those kids are academically,” Scholl said.

The cuts in capital funding can force a district to pull money used for hiring teachers and staff from it’s maintenance and operations budget to fund capital needs, said  Joe Thomas, president of the Arizona Education Association.

“When you give a child an option of you’re going to have an air-conditioned room or you’re going to have a teacher, that’s a false choice for Arizona,” Thomas said.  “That’s why we pay close attention to all of the funding resources, because when you drain one – as the state has done – it impacts all of the other ones.”

“Districts still have needs, and it’s not only having highly qualified educators in the classrooms with the students, it’s about having a safe environment for students to be in and that includes safe buses that function and air conditioners that work and electricity,” Thomas said.

The cuts in capital funding have made it difficult tor districts to meet all their capital needs, said Dr. Heather Cruz, interim assistant superintendent of Litchfield Elementary School District.

“Districts are funded at about 15 cents on the dollar for capital, and so it affects all school districts moving forward because we’re not able to really, adequately take care of our buildings,” Cruz said. “To fund capital in the way, they do you’re really forced to make really tough decisions with regards to capital.”

Cruz said it comes down to “are you going to make that repair on your building, to are you going to do upkeep and maintenance to prevent more costly repairs later, or are you going to buy that bus, or are you going to renew your technology.”

“You’re just forced with just very difficult decisions when you don’t have enough money to go around,” Cruz said.