A New York Appeals Court Orders the State Legislature to Fund New York City Schools . . . Or Does It?

By MICHAEL C. DORF

Wednesday, Mar. 29, 2006

Last week saw another court ruling in the long struggle between New York City and New York State over how much money the State owes the city to help pay for its public schools. In theory, the decision should settle the question whether New York's Legislature and Governor must appropriate billions of additional dollars annually for city schools. But in reality, it probably won't.

Why not? Although the opinion is best read to impose a financial obligation on New York State's political branches, it contains just a smidgeon of ambiguity. Worse, the dissenting judges, who would have preferred to order the allocation of a precise dollar amount, read the majority opinion as merely "urging," as opposed to "directing," action from the political branches. Predictably, statewide elected officials have already seized on these uncertainties to justify further foot-dragging.

The ruling, Campaign for Fiscal Equity, Inc. v. New York, illustrates the adage that half a loaf is better than none. By insisting on their respective positions about exactly how many billions of dollars the State owes the city--positions between which there are only relatively small differences--the majority and dissent may have relegated city schoolchildren to more years of surviving on crumbs.

Federal and State Constitutional Limits on Public Education Funding

Throughout the United States, public elementary and secondary schools are typically funded by local property taxes, as supplemented by state aid to local districts. Within a given state, the revenue generated by local property taxes varies enormously from district to district, depending on whether the residents of the district are poor or wealthy. Accordingly, wealthy districts typically have more money to spend per student than poor districts.

Yet the federal Constitution forbids states from denying any person the equal protection of the laws. Does a state deny equal protection when it makes the quality of education depend upon the happenstance of whether one's parents live in a poor or wealthy school district?

In its landmark 1973 decision in San Antonio Independent School District v. Rodriguez, the U.S. Supreme Court said no, it does not. If the state provides public education (as all states do), it may have a duty to provide a minimally acceptable education to all of its citizens. But, the Court held, the tradition of local funding of, and thus local control over, public education, is sufficiently weighty to warrant sustaining as constitutional the very uneven appropriations that result from paying for schools primarily from locally-generated money.

The federal Constitution, however, is not the only possible limit on how states operate their public schools. Most state constitutions contain specific language obligating the state to provide an education. Thus, in the decades since the Rodriguez ruling, plaintiffs have succeeded in obtaining relief from state courts, which have ordered legislatures to change the way that public education is funded and, in some instances, to implement accountability systems that monitor the performance of public schools.

The New York Case: Interpreting the State's Constitution

New York's constitution is typical. It includes the requirement that "[t]he legislature shall provide for the maintenance and support of a system of free common schools, wherein all the children of this state may be educated."

Although that language does not expressly require equal spending from one district to the next, the highest court of the state, the New York Court of Appeals, ruled in 1995 that it does obligate the state to teach all children "the basic literacy, calculating, and verbal skills necessary to enable children to eventually function productively as civic participants capable of voting and serving on a jury," and to provide "minimally adequate physical facilities and classrooms which provide enough light, space, heat, and air to permit children to learn," "minimally adequate instrumentalities of learning such as desks, chairs, pencils, and reasonably current textbooks," and "minimally adequate teaching of reasonably up-to-date basic curricula such as reading, writing, mathematics, science, and social studies, by sufficient personnel adequately trained to teach those subject areas."

The Litigation That Culminated in the Recent Decision

The plaintiff in the litigation that led to the recent New York decision is styled the Campaign for Fiscal Equity, but that is something of a misnomer. The essence of the argument accepted by the New York state courts is not that the state must provide an equal education to all its residents. If the education in one district is superb, while the education in another is merely very good, that is not constitutionally problematic. According to the courts, the problem arises when, as is sadly true for many schoolchildren in New York City and other parts of the state, public education falls below what is minimally adequate.

Thus, for over a decade, it has been clear that the New York Legislature and Governor have a state-constitutional obligation to do what is needed to improve public school education. And while there are many improvements that can be made by better deploying existing resources, it has also been clear for most of that time that for some school districts, including New York City, existing resources would have to be supplemented with new funds. The question is by how much.

In a 2003 ruling in this litigation, the Court of Appeals directed the state's political branches, among other things, to "ascertain the actual cost of providing a sound basic education in New York City." The high court set a deadline of July 30, 2004 for the state to comply. To his credit, Governor Pataki then proposed spending billions of additional dollars on city schools, but his proposal was substantially watered down in the state legislature, which added only $740 million in funding, only $300 million of which was earmarked for New York City.

At that point, the plaintiffs went back to the trial court, which ruled that the state had not complied with its obligation under the 2003 Court of Appeals decision. After hearing extensive evidence on what it would take to bring city schools up to the court-mandated level, the trial judge accepted the recommendation of a panel of three expert Referees whom he had earlier appointed, and ordered the state to spend an additional $5.63 billion annually for four years, and to make capital improvements of $9.179 billion over five years.

A Victory for the Plaintiffs?

Last week's decision addressed the state's appeal from that order. The Appellate Division, the intermediate court of appeals in New York State, held that the trial judge should not have picked an exact dollar amount for the state to spend. The Referees chose a reasonable method of calculating the state's financial obligation, the Appellate Division said, but not the only reasonable method. An alternative method, favored by the Governor, would increase annual funding by $4.7 billion, rather than $5.63 billion. Given principles of separation of powers, the Legislature and Governor, not the courts, should choose the exact figure and how to apportion it.

Accordingly, under last week's ruling, the political branches in New York now must decide on an additional annual funding figure somewhere between $4.7 billion and $5.63 billion. Even if the Legislature and Governor choose a number at the low end of the range, public schools in New York City and elsewhere in New York State would still benefit enormously. The ruling thus appears to be a substantial victory for the plaintiffs.

But appearances can be deceiving. Within hours of the ruling, political figures in New York State were already bickering over whether they were really required to appropriate at least $4.7 billion.

The Ambiguity in Last Week's Ruling

The source of uncertainty is the Appellate Division's majority opinion itself. Here is the crucial passage, quoted in its entirety: "Thus, while the Legislature should consider the Governor's proposal to increase annual funding by $4.7 billion, together with the Referees' recommendation that $5.63 billion per year is the preferable amount to expend, in the final analysis it is for the Governor and the Legislature to make the determination as to the constitutionally mandated amount of funding, including such considerations as how the funds shall be raised, how the additional expenditures will affect other necessary appropriations and the economic viability of the State, and how the funding shall be allocated between the State and the City."

As the dissenting judges noted, this language suggests that the right number is something between $4.7 billion and $5.63 billion, but it does not actually say that. The actual mandate to the Legislature is to "consider" the two figures--leaving open the possibility that after considering these numbers, the Legislature could determine that "the constitutionally mandated amount of funding" is some number completely outside the range.

In response, the majority denied that it was merely recommending a price range for the Legislature. The opinion states: "Contrary to the dissent's repeated characterization, [our] directive does not merely urge the Governor and the Legislature to consider taking action. They are directed to take action. The matter for them to consider is whether $4.7 billion or $5.63 billion, or some amount in between, is the minimum additional annual funding to be appropriated for the City schools."

Well that ought to settle it, right? The Legislature is "directed" to spend an additional amount not less than $4.7 billion. Right?

Almost. The bottom line of the majority opinion--the part that will be read by the trial judge on remand as his actual mandate--once again uses the "consider" language, although it also seems to say that the Legislature is limited to considering funding levels between $4.7 billion and $5.63 billion.

Here is the full language, excluding the discussion of capital improvements: "[I]n enacting a budget for the fiscal year commencing April 1, 2006, the Governor and the Legislature [should] consider, as within the range of constitutionally required funding for the New York City School District, as demonstrated by this record, the proposed funding plan of at least $4.7 billion in additional annual operating funds, and the Referees' recommended annual expenditure of $5.63 billion, or an amount in between, phased in over four years, and that they [should] appropriate such amount, in order to remedy the constitutional deprivations found in" the 2003 Court of Appeals decision.

Institutional Failure in the Appellate Division

In my view, last week's Appellate Division ruling is best read as giving the Legislature no flexibility to appropriate less than an additional $4.7 billion for the State's under-funded schools. But state legislators who would rather cut taxes than provide additional funding for schools have already seized on the ambiguities in the ruling--citing the language of the majority opinion itself, as well as the dissent's characterization of it--as a justification for further delay in complying with the state constitutional mandate.

To be sure, no matter what the Appellate Division said, one side or the other would have sought further review by the Court of Appeals. But had the Appellate Division left no wiggle room, at least the state's obligations in the meantime would have been clear.

So why did they do it? Why did the dissenters characterize the majority opinion in a way that was predictably going to give comfort to those who want to avoid the constitutional obligation that the dissenters, even more strongly than the majority, believe should be fully implemented, post-haste? And why, when faced with the dissenters' characterization, did the majority judges purport to clarify their intent in one part of the opinion, while leaving the potentially troublesome "consider" language in other parts of its opinion?

I don't have an answer to these questions. Perhaps the judges felt time pressure to release their opinion before the start of the new fiscal year. Perhaps they underestimated the willingness of politicians and their lawyers to interpret judicial opinions self-servingly.

Whatever the explanation, there is something wrong with a court's internal dynamics when parties and their lawyers are left to argue about their rights and duties after a legal ruling has been issued. The whole point of courts, after all, is to settle disputes.

It is ironic that in authoring an opinion that goes to great lengths to emphasize the distinctive roles of the political branches and the courts, the Appellate Division may have lost sight of its own central obligation.


Michael C. Dorf is the Michael I. Sovern Professor of Law at Columbia University. He is the author of No Litmus Test: Law and Politics in the Twenty-First Century.

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