PNGISD BOARD OF TRUSTEES UPDATE

June 27, 2003

“Based on the guidance provided by the Supreme Court, I do not believe that the state can prevail in this lawsuit.”---School Finance Expert Lynn Moak speaking to superintendents at Region IV ESC in June, 2003

TASB SUMMER LEADERSHIP CONFERENCE Thanks to each of you who gave of your time and energy to attend the TASB SLI in San Antonio. Your efforts made it possible for us to have 100% participation of the Board and the Team of 8 at this important event. This year was only the second year in my tenure at PNGISD that we have been successful in achieving this goal. Thanks again for your dedication and selfless contributions to the students and staff of this district. While I attended several interesting sessions, one of the most interesting (and scary) was the session on Closed Meetings that was presented by TASB Attorney Kathleen Wells. I have asked Bonnie to scan the handout from this session for your review. Even though Dr. Thompson appeared to be convinced that there is some latitude in the Open Meetings Act, I become frightened each time I hear a discussion and particularly, when I hear of lawsuits and challenges that have been successful in testing the OMA regulations. I am contemplating buying the TASB OMA video tapes “ 72 Hours OMA” and “The Second Half” for a training session in the future. If any of the rest of you have handouts that you think would benefit the rest of us, please let us borrow them and we will scan them for the next update and return the original to you. (ATTACHED: Copy of “OMA 301: Closed Meetings Revealed”

TASA SUMMER CONFERENCE/ Texas School Coalition I left the TASB Conference for Austin, Texas and the TASA Summer Conference. On Sunday evening, I met with the executive board of the Texas School Coalition. Our impressive success at the Supreme Court appears to have given us some additional leverage with administrators and officials across the state. We have received contacts from several other districts seeking to join our group and the lawsuit. Members of the executive board agreed to pay their district fees and dues early so that our lawyers can begin the process of preparing for the district court trial. In addition, we will be asking each board to pass another resolution reaffirming their support for the lawsuit against the state school finance system. I have asked Mark Trachtenberg to visit with us again at our August Board Meeting and we

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will place this item on the agenda for the August meeting. I have attached a copy of the financial sheet that I sent to Cheryl Hernandez asking her to submit payment for this activity. Money was included in the current budget for this purpose and we are including dollars in next year’s budget for this purpose as well. I have been asked to work with David Hicks of Deer Park ISD to schedule and implement a regional meeting of all Chapter 41 Districts in Regions 4,5, and 6. Since there will be a significant increase in the number of Chapter 41 Districts across the state this year, it is our hope that we will see a sizable increase in the membership of the coalition. The TASA Summer Conference was well-planned and provided good information. I can tell you that I am very tired of sitting in workshops and presentations after attending the TASB and TASA Conferences back to back. It is fortunate that we (superintendents) were in Austin this week. It appears that TEA officials, after a preliminary reading of the recent school finance legislation, decided that Chapter 41 schools would have their per student allocation offset by the amount of the technology allotment ($30). A number of the Chapter 41 Superintendents immediately visited with TEA and then sought opinions from several key legislators who happened to be attending the conference as well—primarily Representative Grussendorf and Senator Shapiro as well as aides from the Governor and Lt. Governor’s office. After receiving assurance from the legislators that it was not their intent to offset Chapter 41 funds, TEA backed off their original interpretation. As it stands today, we will receive an additional $110 per ADA for the next two years. However, there are numerous unfunded mandates in the new legislation, especially in the federal No Child Left Behind legislation. We will be bringing these to your attention as we work through the budget and curriculum issues in coming weeks.

STRATEGY SESSION WITH LAWYERS Yesterday, I met all day in Dallas with the lawyers who represented us in the School Finance Litigation. As we reviewed the litigation and the influence of the organization in the recent legislative session, we believe that there is a clear swing of the pendulum toward increased leverage and toward concern for our issues. For example, our lawyers were invited to speak to the House Committee on School Finance on Tuesday of this week. This is the first time that our side has been asked to provide testimony. David Thompson, who is a well-respected attorney with experience and knowledge about the school finance system, testified in the same hearing before the committee. Our attorneys felt like Mr. Thompson reaffirmed our arguments in this case and that he more or less told the committee that the Supreme Court has “teed up the issues” in our favor. I have provided for your review a copy of the comments prepared by Mr. Thompson and delivered to the House Committee. In addition, for your information, I have provided a copy of the Supreme Court ruling that may interest you. While this litigation will cost additional money, the lawyers feel that this is the time to press forward with the litigation. Based on the latest rumors, it appears that the special session for school finance is likely to be called next spring. Continued action in the court will do nothing but increase the pressure on these guys to do something to fix the system. I CONFIDENTIAL: ANY PERSON WHO HAS ACCIDENTALLY OR INADVERTENTLY GAINED ACCESS TO THIS MATERIAL WHO IS NOT A PNGISD BOARD MEMBER OR SELECTED PNGISD ADMINISTRATOR SHOULD CLOSE THE DOCUMENT IMMEDIATELY AND RETURN TO THE OFFICE OF THE SUPERINTENDENT, PNGISD, 620 AVENUE C, PORT NECHES, TEXAS 77651 OR E-MAIL bjennings@esc5.net

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still believe that the legislature would love nothing more than to walk away from the problem. However, our recent success in court and the prospect for continued success appear to minimize the legislators’ option of leaving things at the status quo. They asked me if we were prepared to stay on board and I assured them that we are committed to WINNING this fight. Indeed, I told the group that our only disagreement with the current situation is that we felt like our name (Port Neches-Groves ISD) should have been listed first in the lawsuit rather than West Orange Cove. The lawyers and everyone else at the meeting agreed. The lawyers indicated that we could change the order of the plaintiffs even now. However, they advised against that strategy since the case is already known as West Orange-Cove. I told them that we were more interested in winning the case than getting recognition, but we would have much preferred to have been the lead plaintiff in this case. According to the lawyers, we will need to expend some resources preparing our case at the district court level. After the district court rules, the lawyers will attempt to circumvent the Austin Appeals Court and get the case back to the Supreme Court. Our lawyers feel that we need to prevail in this case at the Supreme Court Level. Whether we win or lose at the District Court Level, our lawyers feel like our real success will come when we get the case back before the Supreme Court of Texas. We will be scheduling a regional meeting and a meeting of the entire school coalition has been scheduled in Dallas during the TASB Fall Conference. I will let you know more about this later. (ATTACHED: Copy of Supreme Court Ruling, Copy of statement of David Thompson.

TEXAS SCHOOL COALITION LEVERAGE DURING THIS PAST SESSION

CONFIDENTIAL: ANY PERSON WHO HAS ACCIDENTALLY OR

While I could not characterize the last legislative session as a “positive” one for public schools, I believe the presence of the Texas School Coalition did help PNGISD as well as other school districts to benefit from the legislative action as much or more so than any other group. Certainly, everyone suffered as a result of this session. When one begins to describe their victories in terms of things that did not happen, it is easy to see that the session was not a good one. However, we can be glad that the legislature approved the $110 per WADA per year outside the finance formula. This represents new money and it has never been funded outside the formula. This, in effect, is unequalized enrichment. In addition, the relationship that our organization enjoyed with key legislative leaders made it possible for us to quash the TEA interpretation of recent legislation that would have cost us thousands of dollars. The lobbying efforts and the lawsuit have pretty much re-introduced the concept of “adequacy” as a school finance precept and the supreme court ruling as well as comments from people like David Thompson seem to suggest that adequacy may be a cornerstone of new legislation. It now appears that a special session for school finance may be called in April of next year. A recent article in the Equity Center newsletter suggested that Chapter 41 School Districts fared better than Chapter 42 Districts in the recent legislative session. While I don’t know that we fared better, I do believe that much of our success during this session could be attributed to the efforts of the school coalition. For those of you who plan to attend the Fall School Board

INADVERTENTLY GAINED ACCESS TO THIS MATERIAL WHO IS NOT A PNGISD BOARD MEMBER OR SELECTED PNGISD ADMINISTRATOR SHOULD CLOSE THE DOCUMENT IMMEDIATELY AND RETURN TO THE OFFICE OF THE SUPERINTENDENT, PNGISD, 620 AVENUE C, PORT NECHES, TEXAS 77651 OR E-MAIL bjennings@esc5.net

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Conference, the coalition will be meeting on September 20, 2003 at 4:30 p.m. By that time, the Supreme Court will have remanded the lawsuit back to the district court and we will know who the judge will be and we may even have a timeline for discovery and a trial date.

PYRAMID CONSTRUCTORS AND PBK ARCHITECTS As you know, we have dismissed our lawsuit against Pyramid Constructors and PBK Architects in exchange for a $958,000 check from their insurance companies. The check is now drawing interest in our bank. We still have a lawsuit against Coastal Flooring and Pyramid still has a lawsuit against PNGISD to recover their retainage as well as attorney’s fees and interest. Roger and Rick called me in Austin this week to tell me that the judge had set a hearing for this Friday (6-27-03) on a motion by Coastal Flooring to grant summary judgment. The lawyers did not think it was likely that the judge would grant the motion. Just to be safe, they asked me to attend and to invite Harvey to join us in the audience. We agreed to do so but the hearing was abruptly cancelled on Thursday evening and rescheduled for July 7 at 1:30 p.m. Rick and Roger informed me that Coastal has taken the position that they did not do anything wrong and that it is grossly unfair for them to be sued over this matter. However, they did offer $50,000 to make the case go away. Roger thinks they are liable for about $200,000 and he suggested that we consider settlement offers when (and if) the judge denies their motion for summary judgment. I will let you know how this goes. Please remember that Pyramid still claims that we owe them $210,000 plus interest and attorney’s fees. If we settle the case with Coastal, only the suit brought against us by Pyramid will be outstanding. This issue has demanded many hours of time, but I believe we will have about $1,000,000 to address the construction problems that we most definitely would not have had if we had not challenged the work of the construction company, contractors, and architect. I believe that our time and effort in this case have proved to be good investments. Of course, we will never have the floor that we should have gotten. However, we at least have some resources to implement a reasonable repair that would not have been possible without these settlements. Thank you for your support in taking a stand on these issues. I have attached for your review a copy of the motion to dismiss our suits against Pyramid and PBK. (ATTACHED: Copy of motion to dismiss and copy of settlement statement)

ARTICLE ON NEW SCHOOL FUNDING I have attached for your review a copy of a recent article from The Beaumont Enterprise that describes the “new” money allocated by the legislature for public schools. While there are many other unfunded mandates in the legislation, this money flows outside the formula and will help considerably. (ATTACHED: Copy of article from The Beaumont Enterprise)

CONFIDENTIAL: ANY PERSON WHO HAS ACCIDENTALLY OR INADVERTENTLY GAINED ACCESS TO THIS MATERIAL WHO IS NOT A PNGISD BOARD MEMBER OR SELECTED PNGISD ADMINISTRATOR SHOULD CLOSE THE DOCUMENT IMMEDIATELY AND RETURN TO THE OFFICE OF THE SUPERINTENDENT, PNGISD, 620 AVENUE C, PORT NECHES, TEXAS 77651 OR E-MAIL bjennings@esc5.net

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FEDERAL HEARING As you are aware, we are required to make a special report to the Board each year about the expenditure of federal funds. A special hearing for this purpose is scheduled prior to the next meeting on July 8, 2003. The hearing is scheduled to being at 6:30 p.m. As usual the regular board meeting will commence at 7:00 p.m. after the hearing on federal funds. Dr. Randall will present the report on federal expenditures. Please mark your calendars for a 6:30 p.m. start time for the hearing that will be held prior to the regular board meeting. REMINDER: HEARING ON FEDERAL DOLLARS TO BEGIN AT 6:30 P.M. JULY 8, 2003

RETIREMENT RECEPTION NOTE I am attaching for your review another nice note we received thanking us for the retirement reception. As you will recall, the reception idea in lieu of a formal recognition banquet or luncheon was new to our district last year. In our second year of the reception, it appears that our employees have embraced this activity as an appropriate forum for expressing our appreciation and best wishes to those who are leaving us. (ATTACHED: Copy of note from Elaine Sherman)

TAX COLLECTIONS MONTHLY REPORT Please find attached a copy of the monthly tax collections report submitted by Cheryl Hernandez. (ATTACHED: Copy of monthly tax collection report)

AMERIPOL-SYNPOL EFFORTS I met last week with Jess Byerly of the Economic Development Corporation regarding their efforts to keep Ameripol-Synpol in our community. She asked me to make a commitment regarding our willingness to consider agreements that might enhance the tax status of a new buyer. I explained to Jess that the law limits our options regarding school taxes. However, I did provide her with a written statement indicating that we would be happy to consider another HB 1200 agreement if we perceived the agreement to be in our best interests (Copy of my letter attached). I explained that the company would be required to bring us an application and proposal with a non-refundable application fee of $75,000. This fee was established at the beginning of our negotiations with Sabina Petrochemicals and it applies to all potential applicants. (ATTACHED: Copy of letter regarding HB 1200)

GROWTH PLAN As you will recall, during the Level III hearing of a complaint against Ms. Clara Graham, the Board directed us to implement a growth plan and to provide the Board with a progress report at the August Board meeting. However, since that time, Mrs. Graham has chosen to retire thus making the progress report a moot point. I have attached a copy of an e-mail I CONFIDENTIAL: ANY PERSON WHO HAS ACCIDENTALLY OR INADVERTENTLY GAINED ACCESS TO THIS MATERIAL WHO IS NOT A PNGISD BOARD MEMBER OR SELECTED PNGISD ADMINISTRATOR SHOULD CLOSE THE DOCUMENT IMMEDIATELY AND RETURN TO THE OFFICE OF THE SUPERINTENDENT, PNGISD, 620 AVENUE C, PORT NECHES, TEXAS 77651 OR E-MAIL bjennings@esc5.net

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received from Dr. Randall reminding me of the fact that we will not be making this report to the Board. (ATTACHED: Copy of e-mail from Dr. Randall regarding progress report to be made to the Board)

EARLY CHILDHOOD CAMPUS As I mentioned in a previous Update, the retirement of Ms. Graham has created gaps in various areas of responsibility within the district. We have attempted to cover most of those responsibilities by reassigning duties and making changes to the job descriptions of other employees. However, the responsibility for supervision and administration of the Early Childhood Campus and program is a significant responsibility that must be filled. Indeed, the No Child Left Behind legislation has the potential to generate many changes and significant responsibility for the leader of this campus. Yet, we would prefer not to hire a new employee to manage this campus and assume the responsibilities that were formerly assigned to Ms. Graham. As I mentioned, we have restructured many of these duties to include them in the job descriptions of other employees. However, we have decided to assign responsibility for the Early Childhood Campus to Ms. Suzanne Mondey in addition to her current responsibilities as Director of Special Education. Since Ms. Mondey indeed does have a full time responsibility as Director of Special Education, the additional responsibility will require Ms. Mondey to work additional hours and to expend additional effort. However, Ms. Mondey has assured us that she is willing and able to assume this additional responsibility and we have confidence in her ability to do so. Therefore, it is our intention to provide Ms. Mondey with an additional stipend of $5,000 to compensate for the significant additional time and energy that will be required to meet this obligation. Please find attached copies of e-mail from Dr. Randall and from Mr. Martin in which they recommend this change in responsibility. I have also attached a copy of the updated job description for Ms. Mondey to reflect this change. As I stated previously, we would prefer to hire a replacement to take all the job responsibilities formerly held by Ms. Graham. However, this combination of restructuring and reassignment of the major responsibilities with a stipend payment provide the best strategy, in our opinion, to meet the obligations and responsibilities while conserving an additional professional position in our budget. We believe that these changes will provide adequate supervision and direction for the Early Childhood Center and will cover the responsibilities formerly held by Ms. Graham in an effective and efficient manner. (ATTACHED: Copies of e-mail from Dr. Randall, Mr. Martin, and updated job description for Ms. Mondey)

HAVE A GREAT WEEKEND! CONFIDENTIAL: ANY PERSON WHO HAS ACCIDENTALLY OR INADVERTENTLY GAINED ACCESS TO THIS MATERIAL WHO IS NOT A PNGISD BOARD MEMBER OR SELECTED PNGISD ADMINISTRATOR SHOULD CLOSE THE DOCUMENT IMMEDIATELY AND RETURN TO THE OFFICE OF THE SUPERINTENDENT, PNGISD, 620 AVENUE C, PORT NECHES, TEXAS 77651 OR E-MAIL bjennings@esc5.net

CONFIDENTIAL: ANY PERSON WHO HAS ACCIDENTALLY OR INADVERTENTLY GAINED ACCESS TO THIS MATERIAL WHO IS NOT A PNGISD BOARD MEMBER OR SELECTED PNGISD ADMINISTRATOR SHOULD CLOSE THE DOCUMENT IMMEDIATELY AND RETURN TO THE OFFICE OF THE SUPERINTENDENT, PNGISD, 620 AVENUE C, PORT NECHES, TEXAS 77651 OR E-MAIL bjennings@esc5.net

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II~ Texas Association of School Boards512-467-3610 . 800-580-5345

: E-mail: legal@tasb.org

2003 Summer Leadership InstituteJune 19-21, 2003

Presented by Kathleen Wells, Director of Legal ServicesTexas Association of School Boards

OMA 301: Closed Meetings RevealedT ASH Legal Services Division

Thou Shalt Obey the OMA Exceptions.L

A. General Rule: Open Meeting Required

All business open to public: In gen~ all school board meetings must be open tothe public. Tex. Gov't Code § 551.002. Nevertheless, the Open Meetings Act (OMAor Act) authorizes boards to meet in closed session for certain specific purposes. Tex.Gov't Code §§ 551.071-551.086. For a closed meeting to be legal, it must be held forone of these enumerated purposes.

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Closed meetings permitted, not required: The Act does not require a board to gointo closed meeting on any matter. Even if a subject falls within one of the limitedstatutory exceptions, those exceptions are pennissive, not mandatory, in nature.

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B. Exceptions to the Rule: Valid Reasons for Holding Closed Meetings

Consultation with attomey: To consult with the board's attorney when the boardseeks advice about pending or contemplated litigation or a settlement offer, or whenthe attorney will have an ethical duty of confidentiality. Tex. Gov't Code § 551.071

Real property: To deliberate the purchase, exchange, lease, or value of real propertyif deliberation in an open meeting would have a detrimental effect on the board'sposition in negotiations with a third person. Tex. Gov't Code § 551.072.

Prospective gifts: To deliberate a negotiated contract for a prospective gift to thedistrict if deliberation in an open meeting would have a detrimental effect on theboard's position in negotiations with a third person. Tex. Gov't Code § 551.073.

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. Personnel matters: To deliberate the appointment, employment, evaluatio~reassignment, duties, discipline, or dismissal of a public officer or employee, or to heara complaint or charge against an officer or employee. This exception does not apply ifthe officer or employee who is the subject of the deliberation or hearing requests apublic hearing. Tex. Gov't Code § 551.074. See also Tex. Gov't Code § 551.082.

Security: To deliberate the deployment, or specific occasions for implementatio~ ofsecurity personnel or devices. Tex. Gov't Code § 551.076.

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Student discipline: To deliberate in a case involving discipline of a public schoolchild. unless the child's parent requests an open hearing in writing. Tex. Gov't Code§ 551.082.

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Student information: To deliberate a matter regarding a public school student ifpersonally identifiable information about the student will necessarily be revealed bythe deliberation, unless an open meeting about the matter is requested in writing by thestudent's parent or guardian or by the student, if the student has attained 18 years ofage. Tex. Gov't Code § 551.0821 (lIB 1226, passed by the 78th Texas Legislature).

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Economic development: To deliberate about commercial or fInancial infonnationthat the board has received from a business prospec~ or to deliberate the offer of afmancial or other incentive to a business prospect. Tex. Gov't Code § 551.087.

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Assessment instruments: To discuss or adopt individual assessment instruments orassessment instrument items. Tex. Educ. Code § 39.030.

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Thou Shalt Give Proper Notice.u.

Proper notice required: The notice requirements for items to be discussed in closedmeetings are the same as those for items to be discussed in open meetings. Tex. Att'yGen. LO-90- 27 (1990). So begin with a properly posted meeting, giving 72 hours'notice of all items to be discussed or about which information will be received. Tex.Gov't Code §§ 551.041,551.043.

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Don't specify in advance: The notice does not have to identify which items will beheard in a closed meeting as opposed to an open meeting. Rogers v. State Board ofOptometry, 619 S. W.2d 603 (Tex. App.-Eastland 1981, writ dism'd); Tex. Att'yGen. L0-90-27 (1990). A board can achieve flexibility by posting a single list of alltopics to be discussed, followed by a statement that any closed meeting will be heldin accordance with Texas Government Code, Chapter 551, subchapters D and E.(See sample notice in Attachments.)

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Notice only for closed session: Posting notice of a subject only for discussion inclosed session does not provide adequate notice that the board will take subsequentaction on the issue in open session. Weaver v. Santa Maria Indep. Sch. Dist., Tex.Comm'r ofEduc. Decision No. 166-RI-599 (Dec. 12, 1999).

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Thou Shalt Not Vote in a Closed Meeting.m.Get "out" to vote: Neither final action nor a straw poll may be taken in a closedmeeting. Tex. Gov't Code § 551.102; Bd. of Trustees of Austin Indep. Sch. Dist. v.Cox Enter., Inc., 679 S. W.2d 86 (Tex. App.-Texarkana 1984), aff'd in part andrev'dinpart, 706 S. W.2d 956 (Tex. 1986); Op. Tex. Att'y OeD. Nos. H-1198 (1978),H-1163 (1978).

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. Express yourself: Although the board may not vote in a closed meeting, boardmembers may express their opinions and vol\Ultarily anno\Ulce how they intend tovote when an actual decision is made in open session. Bd. of Trustees of .AustinIndep. Sch. Dist. v. Cox Enter., Inc., 679 S. W.2d 86 (Tex. App.-Texarkana 1984),aff'd in part and rev'd in part, 706 S. W.2d 956 (Tex. 1986).

Be specific: The board must return to open session in order to vote on a matterdeliberated in closed session. The board must vote on a motion that adequatelydescribes the action the board wishes to take; the motion cannot be simply "to dowhat was discussed in closed session."

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IV. Honor Thy Lawyer.

Legal advice only: A board may meet in closed session with its attorney to discuss"strictly legal matters." For example, a board may consuh with its attorney in closedsession to receive advice on legal issues raised by a proposed contract but not todiscuss the merits of the proposed con~ financial considerations, or other non-legal matters. Op. Tex. Att'y Gen. No. JC-0233 (2000).

Long distance: A board may consult with its attorney by telephone conference call,video conference call, or Internet communications during a meeting in open or closedsession. This provision does not apply to consultations between the board and "in-house'counsel (attorneys who are employees of the district). If the consultation takes place inopen session, the consultation must be audible to the public. Tex. Gov't Code § 551.129

Thou Shalt Not Take the Name of Your Employee in Vain.v.. Individual employees: The personnel exception, Texas Government Code section

551.074, applies only when the board discusses a particular officer or employee, not awhole class of employees. For example, a board may not use the exception to discussits salary schedule. The board may, however, use the exception to discuss an individualemployee's salary because that discussion inherently includes an evaluation of theemployee's performance. Op. Tex. Att'y Gen. No. H-496 (1975).

Board members: This exception applies to board members as well as employees.For example, the board may deliberate the selection ofboard officers in closedsession; however, the decision must be made in open session. Bd. of Trustees ofAustin Indep. Sch. Dist. v. Cox Enter., Inc., 679 S. W.2d 86 (Tex. App.- Texarkana1984), aff'd in part and rev ' d in part, 706 S. W .2d 956 (T ex. 1986).

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Independent contractors: The exception does not apply to deliberations regardingindependent contractors, such as attorneys, engineers, architects, or consultants. Op.Tex. Att'y Gen. No. MW-129 (1980).

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Thou Shalt Not Ignore a Valid Request for an Open Meeting.VI.

Exception to the exception: The personnel exception does not apply if the officer oremployee who is the subject of the deliberation or hearing requests a public hearing.Tex. Gov't Code § 551.074. See also Tex. Gov't Code § 551.082. When this occurs,the board must conduct a public hearing and also deliberate about the matter in opensession, unless the employee consents to the board's deliberating in private. James v.Hitchcock Indep. Sch. Dist., 742 S. W.2d 701 (Tex. App.-Houston [1st Dist.] 1987.writ denied); Corpus Christi Teachers' .Ass'n v. Corpus Christi Indep. Sch. Dist., 535S.W.2d429 (Tex. Civ. App.-Corpus Christi 1976. no writ).

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Level m grievances: Most districts have a local policy that calls for personnelmatters to be discussed in closed session, unless the employee requests otherwise.Consequently, Level ill grievances regarding personnel issues should be conducted inclosed session unless the employee requests an open session.

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Public comment: Although most districts have a local policy that calls for personnelmatters to be heard in closed session, there is no requirement that a board move intoclosed session to hear "public comment" complaints about an employee. Dixon v.Grand Prairie Indep. Sch. Dist., Tex. Comm'r ofEduc. Decision No. 064-R3-1299(Nov. 6,2001).

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The trump card: When two or more employees are involved in a grievance, whichone has the power to request an open meeting? When an employee brings a generalemployment grievance (about a condition of work, for example), the employeebringing the grievance has the power to request an open meeting. When an employeebrings a grievance about another employee, however, the officer or employee who isthe subject of the complaint is the one who may request an open meeting. CompareTex. Gov't Code § 551.074 with Tex. Gov't Code § 551.082.

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What's it aU about? A school board should exercise caution and seek legal advice ifnecessary to determine the true subject matter of a grievance before denying anemployee's request for an open hearing. For example, after a teacher requested an openhearing of his complaint about "the principal's and the superintendent's actions in theevaluation process," the board met in closed session, erroneously reasoning that theprincipal and superintendent, not the teacher's evaluation, were the subjects of thecomplaint. The attorney general concluded that "[t]he teacher's complaints about theprincipal and superintendent [were] incidental to his grievance against the school district,which necessarily acts through its agents." Op. Tex. Att'y Gen. No. JM-1191 (1990).

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Parental complaint about employee: An even more complicated situation can arisewhen a parent complains about a school employee. For example, if a parent complainsabout the discipline imposed by a teacher, and the parent wants the complaint heard inan open meeting while the teacher does not, where should the board hear the complaint?The attorney general recommends separating the two issues-the discipline issue andthe personnel issue-so that one may be heard in open meeting and the other in closed.If this bifurcation is not possible, then the parent's request for an open meeting hearingmust be honored because the teacher has no corresponding "right" to request a closedhearing. Tex. Att'y Oen. LO-95-082 (1995).

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Thou Shalt Follow All Proper Procedures, Lest Grievous Harm Befall You.VB.

A. Conducting a Closed Meeting

. Convene in open meeting: Before a board may conduct a closed meeting, asauthorized by the Act. a quorum of the board must first convene in a properly postedopen meeting. Tex. Gov't Code § 551.101; Rd. of Trustees of Austin Indep. Sch. Dist.v. Cox Enter., Inc., 679 S. W.2d 86 (Tex. App.-Texarkana 1984), aff'dinpart andrev'd in part, 706 S. W.2d 956 (Tex. 1986).

Announce authority: At an appropriate point on the agenda during open session, thepresiding officer must publicly (1) announce that a closed session will be held and (2)identify the section or sections of the Act under which the closed meeting will beheld. Tex. Gov't Code § 551.101. Although it is not necessary for the presidingofficer to state the actual section number of the statute that authorizes the closedmeeting, the presiding officer must give enough information about the subject matterof the closed meeting to enable the public to identify the board's authority for themeeting. Lone Star Greyhound Park v. Tex. Racing Comm 'n, 863 S. W.2d 742 (Tex.App.-Austin 1993, writ denied).

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Convene the closed meeting: The presiding officer must annoWlce the date and timeat the beginning and end of each closed session. Tex. Gov't Code § 551.103.

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B. Recording a Closed Meeting

Required record: Either a certified agenda or an official tape recording must be keptof the proceedings of each closed meeting, except for a board's private consultationwith its attorney as permitted WIder section 551.071. Tex. Gov't Code § 551.103(a).This record provides a method of verifying in court proceedings that the boardcomplied with the requirements of the Act. Tex. Gov't Code §§ 551.103,551.104; Op.Tex. Att'y Gen. No. JM-840 (1988). (See sample certified agendas in Attachments.)

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Required contents: A certified agenda or official tape recording must record thepresiding officer's statement of the date and time at both the beginning and end of theclosed session. Tex. Gov't Code § 551.103(c), (d). A certified agenda must alsoinclude a statement of the subject matter of each item discussed in closed session, notjust each item scheduled for discussion. Tex. Gov't Code § 551.103(cXl); Op. Tex.Att'y Gen. No. JM-840 (1988). It must include a record of any further action taken inopen session on the closed session items. Tex. Gov't Code § 551.103(cX2). Finally,the presiding officer must certify that a certified agenda is a true and correct record ofthe closed session proceedings. Tex. Gov't Code § 551.103(b).

Record retention: A certified agenda or tape recording must be maintained for atleast two years after the date of the closed meeting. Iflitigation involving themeeting is brought within that time peri~ the certified agenda or tape must bepreserved while the litigation is pending. Tex. Gov't Code § 551.105(a).

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Release to the public: A certified agenda or tape recording of a closed meeting isavailable for public inspection and copying only under a court order. Tex. Gov't Code §551.IO4(c); Op. Tex. Att'y Oen. No. JM-995 (1988); Tex. Att'y Gen. ORD-330 (1983).However, forwarding the record of a closed session Level ill grievance hearing to thecommissioner on appeal is not a violation of the Act. Tex. Educ. Code § 7.057(c).

Access for board members: Trustees who attended a closed meeting may review thecertified agenda or tape recording of that meeting. Op. Tex. Att'y Gen. No. DM-227(1993). Likewise, current board members may review the tape recording or certifiedagenda of a closed meeting even if they did not attend the meeting. The board mayadopt procedures for review; however, the board may not absolutely prohibit a boardmember from reviewing the tape or certified agenda. The board may not give a boardmember a copy of the tape or certified agenda. In addition, a former board membermay not review the tape recording or certified agenda after he or she has left office.Op. Tex. Att'y Gen. No. JC-OI20 (1999); Tex. Att'y Gen. L0-98-033 (1998).

.

Thou Shalt Know Who May Come into Your Presence.vm.

Board's discretion: A board has the discretion to invite anyone it chooses to attendits closed session. Op. Tex. Att'y Gen. Nos. IC-0375 (2001), JM-OO06 (1983). Ifaclosed session is convened under the attorney consultation exception, however, theboard may not admit an adversary or individual whose presence would preventprivileged communication between the board and its attorney. Op. Tex. Att'y Gen.Nos. JM-0238 (1984), IC-0506 (2002).

.

. Superintendent's "right" to attend: A contractual provision requiring asuperintendent to attend all closed sessions, except those pertaining to thesuperintendent's contract or salary and benefits, does not violate the Act. On the otherhand, a contractual provision that confers on the superintenden~ a righ~ rather than anobligation, to attend all closed sessions may not be pennissible under the Act. Op.Tex. Att'y Gen. No. JC-O375 (2001).

6

C Texas Association of School BoardsLegal Services Division

. Ex£luding witnesses: A governmental body that is investigating a matter mayexclude a witness from a hearing (open or closed) during the examination of anotherwitness in the investigation. Tex. Gov't Code § 551.084. This provision is designedto protect the integrity of the hearing process by preventing witnesses from beingswayed by the testimony of other witnesses.

IX. Thou Shalt Not Blab.

. Criminal penalties: The Act itself does not provide criminal penalties for a personpresent in a closed meeting who discloses the substance of closed meetingdeliberations. Nevertheless, other serious penalties may apply. Op. Tex. Att'y. Gen.No. 1M-I071 (1989). For example, a board member may violate Texas Penal Codesection 39.06 if he releases "official information."

Civil actions: In additio~ a board member who releases closed session informationmay be subject to civil lawsuits. For example, a board member who repeats falseinformation discussed in a closed meeting could be held liable for defamation. Inadditio~ a board member who reveals closed session deliberations is likely violatingthe board's code of ethics policy or violating fiduciary duties to the district.

.

x. Thou Shalt Not Get Dragged into Court.

A. Civil Actions for Closed Meeting Violations

. Injunction or mandamus: Any interested person may sue for an injunction ormandamus to stop, prevent, or reverse a violation or threatened violation of the Act.Costs of litigation and attorneys' fees may be assessed against a board if a violation isfound. Tex. Gov't Code § 551.142.

Voidable action: Any action taken by the board in violation of the Act is voidableby a court. Tex. Gov't Code § 551.141; Piazza v. City o/Granger, 909 S. W.2d 529(Tex. App.-Austin 1995, no writ); Toyah v. Pecos-Barstow Indep. Sch. Dist., 466S. W.2d 377 (Tex. Civ. App.-San Antonio 1971, no writ); Op. Tex. Att'y Gen. No.H-594 (1975).

.

Corre&:Dng mistakes: If a board discovers that it has taken action in violation of theAct, the action may be corrected and reauthorized at a subsequent meeting. SeeLowerC%. RiverAutk v. City of San Marcos, 523 S.W.2d641 (Tex. 1975). Butactions taken in violation of the Act, even when subsequently corrected, may subjectboard members to criminal penalties.

.

7

~ Texas Association of School BoardsLegal Services Division

B. Criminal Actions for Closed Meeting Violations

.

.

Circumventing the Act: A board member commits a misdemeanor offense if he orshe "knowingly conspires to circumvent" the Act by meeting in numbers less than aquorum for secret deliberations. The punishment is a fine of $100 to $500,confinement for one to six months in county jail, or both. Tex. Gov't Code § 551.143.

Holding an illegal closed meeting: A board member commits a misdemeanor offenseif a closed meeting is not permitted by the Act, and the member knowingly calls or aidsin calling, closes or aids in closing, or participates in the lDllawful closed session ormeeting. The punishment is a fine of $1 00 to $500, confinement for one to six monthsin county jail, or both. Tex. Gov't Code § 551.144. The Texas Court of CriminalAppeals (the highest criminal court in Texas) has interpreted this statute to mean that aboard member can be convicted of a criminal violation ifhe or she participates in anillegal closed meeting, even if the board member does not know that the closed meetingis not authorized by the Act. Tovar v. State, 978 S. W.2d 584 (Tex. Crim. App. 1998)(en banc). It is a defense to prosecuti~ however, that the board member acted inreasonable reliance on a written opinion of a court, the attorney general, or the schooldistrict's attorney. Tex. Gov't Code § 551.144(c).

Failing to record a closed meeting: A board member commits a misdemeanor offenseifhe or she participates in a closed meeting knowing that a certified agenda or taperecording is not being kept. Tex. Gov't Code § 551.145.

Disclosing a certified agenda: A person commits a misdemeanor offense if theperson, without authority, knowingly discloses to a member of the public the certifiedagenda or tape recording of a lawfully closed meeting. In addition, a person injuredor damaged as a result of the disclosure may seek actual damages, attorneys' fees,and punitive damages as remedies in a civil lawsuit. Tex. Gov't Code § 551.146.

.

8

C Texas Association of School BoardsLegal Services Division

C Texas Association of School BoardsLegal Services Division

Helpful Resources:Texas Open Meetings Act

T ASH Legal Senrices DivisionThe School OffICial's Guide to the Texas Open Meetings ActThis recently updated and revised book answers the most common questions about the OpenMeetings Act and assesses the ongoing interpretations of the Act by the comts and the attorneygeneral. It includes procedures for closed meetings, an expanded set of meeting agenda examples foruse in your district, and information on meeting notices and enforcement of the Act. 02002

Pocket Guide to The Texas Open Meetings Act111is convenient, pocket-sized flip chart includes the basics on the Texas Open Meetings Act,including the definition of "meeting, " exceptions to allow "closed meeting, " notices, and more.

Introduced at SU 2002 and inspired by a Leadership TASB team, this handy pocket reference will beyour first line of defense to answer those thorny OMA questions on the spot. C 2002.

72 Hours: Investigating the Open Meetings ActThis one-hour training video offers a light-hearted look at the legal requirements of the OpenMeetings Act. The video package provides the basics of conducting legal and effective school boardmeetings and explores scenarios ~ are likely to enco\D1ter. Extensive written materials includedUpdated to reflect 1999 legislative changes. 01999.

The Second Half: Going Deep into the Texas Open Meetings ActIn less than an hoW', this entertaining video package will cover OMA basics and push YoW' board todte next level by answering some tough questions. When can board members communicate outsideof board meetings? How does dte new definition of "meeting" change YOW' posting practices? Howshould a board address a subject that's not on dte agmda? This video package converts tough topicsinto simple scenarios and an easy way for YoW' team to earn one hoW' of board training ~t. 02000.

OutlinesIHandoutsLegal Services offers outlines on a number of legal topics, including the Open Meetings Act.

Open Meetings Act FAQ'shttD:/ /www.tasb.0r2/0r0ducts services/le2a1/faa oma.shtml

T ASH Policy ServiceBE series in your district's policy manual.

TASB Leadership Team Servi&:es:Effective Meetings: Your Leadership Makes the Difference<:>2001 (book and CD ROM available)

Tens Attorney GeneralTaas Open Meetings Ad HandbookOnline: httD:/ /www.oae:.state.!x.us!AG Publications/txts/ooenmeetine:s2000.htm

~ Texas Association of School BoardsLegal Services Division

SAMPLE: NOTICE OF REGULAR MEETING

Notice of Regular MeetingBoard of Trustees

Star of Texas Independent School DistrictMarch 25, 2002

A regular meeting of the Board of Trustees of the Star of Texas Independent School District will beheld on March 25,2002, beginning at 7 p.m., in the Board conference room of the Star of TexasIndependent School District at 54321 East Center Avenue, Center Star, Texas.

The subjects to be discussed or considered or upon which any formal action may be taken are listedbelow. Items do not have to be taken in the same order as shown on this meeting notice.

Unless removed from the consent agenda, items identified within the consent agenda will be actedon at one time.

1.2.

3.

4.5.6.7.8.

9.

10.11.12.

Public comments/audience participationConsent agendaa. Minutes of the FebnJaIY 25,2002, meeting of the Boardb. Resolution to affimt Child Safety Monthc. Monthly financial reportContracts with Region XXX Education Service Center regarding cooperative purchasingprogram and cooperative special education programConsultation with school district attorney concerning pending condemnation lawsuitSettlement of pending condemnation lawsuitPresentation by personnel director concerning future district staffing requirementsTexas Education Agency accreditation audit/inspectionPolicy changesa. DEC(LOCAL): Employee compensation and benefits-leaves and absencesb. FOB(LOCAL): Student disciplineDistrict employees and officersa. Trustee resignationb. Appointment to fill trustee vacancyc. Report on district salary studyd. Resignation of administrative employeesAcquisition of real estate for possible school sitePurchases of supplies and equipmentPublication for competitive bid notices regarding contract for renovation to industrial artsbuilding

C Texas Association of School BoardsLegal Services Division

13. Superintendent's reporta. Progress of construction of high schoolb. Resignation of teachersc. Student achievementd. Budget issues

If, during the course of the meeting, discussion of any item on the agenda should be held in a closedmeeting, the Board will conduct a closed meeting in accordance with the Texas Open Meetings Act,Texas Government Code, Chapter 551, Subchapters D and E. Before any closed meeting isconvened, the presiding officer will publicly identify the section or sections of the Act authorizingthe closed meeting. All final votes, actions, or decisions will be taken in open meeting. [See

BEC(LEGAL)].

This notice was posted in compliance with the Texas Open Meetings Act on March 22,2002 at 3 :00p.rn.

For the Board of Trustees

~ Texas Association of School BoardsLegal Services Division

SAMPLE: CERTIFIED AGENDA FORM[On School Letterhead]

CER'.'lt'lED AGENDA OF CLOSED SESSIONMeeting of (Date)

CONFIDENTIAL: No one shall, without lawful authority, knowingly disclose to a member of thepublic this certified agenda of a closed meeting. A person who violates this subsection commits aClass B misdemeanor and may be liable to any party injmed or damaged by the disclosure. TexasGovernment Code § 551.146(a).

Statement of Beginning of Closed Session. The presiding officer annolDlced at the beginningof the closed session:

I

"The Board of Trustees on (date), beginning at _.m. (time), convened inclosed session in accordance with the Texas Open Meetings Act. "

n. Subjects Discussed in the Session Closed to the Public:

(Subject No. 1)

(Subject No.2)

(Subject No. 3)

Statement at End of Closed Session. The presiding officer announced at the end of theclosed session:

ill.

"The Board ended its closed session at _.m. (time) on (date)."

N. Record of Further Action Taken, if Any, on.Above Items in the Subsequent Open Session:

(Subject No. 1)

(Subject No. 2)-

(Subject No.3)

v Certification by Presiding Officer. I hereby certify that the foregoing is a true and correctrecord of the closed session proceedings on the above date.

Signature

Presiding Officer (type name)

C T cxas Association of School BoardsLegal Services Division

SAMPLE: CERTIFIED AGENDA[On School Letterhead]

CERTD'lED AGENDA OF CLOSED SESSIONMeeting of March 25, 2002

CONFIDENTIAL: No one shall, without lawful authority, knowingly disclose to a member of thepublic this certified agenda of a closed meeting. A person who violates this subsection commits aClass B misdemeanor and may be liable to any party injured or damaged by the disclosure. TexasGovernment Code § 551.146(a).

Statement of Beginning of Closed Session. The Presiding officer annolU1ced at the beginningof the closed session:

I.

"The Board of Trustees on March 25, 2002, beginning at 7:45 p.rn., convened in a closedsession in accordance with the Texas Open Meetings Act. "

Subjects Discussed in the Session Closed to the Public.n.

1. Evaluation and consideration of two-year extension of contract of the high schoolprincipal, Ms. Jane Doe

2. Implementation of a sniffer dog program3. Market value of real estate proposed as high school site4. Expulsion of Johnny Roe

Statement at End of Closed Session. The presiding officer announced at the end of theclosed session:

m

"The Board ended its closed session at 9 p.rn. on March 25, 2002."

IV. Record of Further Action Taken, if Any, on Above Items in the Subsequent Open Session.

1. Board approved one-year extension of the principal's contract2. Board approved contract with sniffer dog handler company3. No action taken4. Board voted to expel student

v. Certification by Presiding Officer. I hereby certify that the foregoing is a tJUe and correctrecord of the closed session proceedings on the above date.

Signature

Presiding Officer (type name)

THE SUPREME COURT OF TEXASPost Office Box 12248Austin. Texas 78711 -- ~ ~ .46,}.1312

May 29, 2003

Mr. George W. Bramblett, Jr.Haynes &: Boone, LLP901 Main Street, Suite 3100Dallas, TX 75202-3789

Mr. Mark Ryan TrachtenbergHaynes and Boone, U.P1000 Louisana Street, Suite 4300HoUSton, TX 77002-5012

Mr. Doug W. RayRay Wood &: Bonilla LLP2700 Bee Caves Road 1200Austin. TX 78746

Ms. Julie Caruthen PanteyOffice of the Solicitor General of TexasPost Office Box 125-48Austin, TX 78711-2548

Ms. Letici2 Marie SaucedoMexican American Lep1 Defense (MAlDEf)140 E. Houston St., Ste. 300San Antonio, TX 78205

Case Number 02-0427Court of Appeals Number: OJ..Ql-00491-CVTrial Court Number: GV100528

WEST ORANGE-COVE CONSOLIDATED lSD,. ET AL.v.FEmE ALANIS, IN HIS OFFICIAL CAPAcrrY AS nIE COMMISSIONER OFEDUCATION, ET AL.

Dear Counsel:

Today the Supreme Court of Texas issued the following opinions in the above-referenced case.See enclosed opinions.

Sincerely.

-1~~~::!~~~-aukcc: The Hon. B. B. Schraub

Paul PomeroyMr. Tom ThomasJames C. HarringtonMs. Diane O'Neal, ClerkMs. Amalia Rodriguez-Mendoza

IN THE SUPREME COURT OF TEXAS

No. 02-0427

WEST ORANGE-COVE CoNSOLIDATED I.SD.ET AL., PEnTIONERS

FELIPE ALANIS, IN IDS OFFICIAL CAPACITY AS

THE COMMISSIONER OF EDUCAnON, ET AL., REsPONDENTS

ON PETmON FOR. REVIEW FROM nfECoURT OF APPEALS FOR. THE 'nI1RD DISTR.ICT OF TExAS

Argued March 27, 2003

JUS11CE HECKT delivered the opinion of the Court, in which CHIEF Jus11cePl ml.IPS, JumCEOWEN, JUS11CE 0 'NEn.L, JumCE JEFFERSON, JUS'nCE SCHNEIDER, and JUS11CE W AINWRIOHr joined.

JUSTICE ENOCH filed a concuning opinion.

JumCE SMmf filed a dissenting opinion.

Article ~ section l-e of the Texas Constimtion states: -No State ad valorem taxes shall

be levied upon any property within this State.8' We have held that 8[a]n ad valorem tax is a state tax

when it is im~ed directly by the State or when the State so completely controls the levy,

TEx. CONlY. lit. vm. . l-e

assessment and disbursement of revenue, either directly or indirectly, that the [taxing] authority

employed is without meaningful discretion.-2

The maintenance and operation of Texas public schools are funded mostly by ad valorem

taxes levied by local school districts under comprehensive state regulation that, among other things,

caps the rates at which districts can tax and redistributes local revenue among districts. In 1995, we

held that the State's control of this school funding system bad not made local property taxes an

unconstitutional state tax because school districts retained meaningful discretion in generating

revenue, but we foresaw a day when increasing costs of education and evolving circumstances might

force local taxation at maximum rates.3 At that point, we said, the conclusion that a state property

tax had been levied would be "unavoidable.,.

In the case before us, four plaintiff school districts allege that that day has come.

Specifically. they contend that they and other districts have been forced to tax at maximum rates set

by statute in order to educate their students. These taxes, they say, have become indistinguishable

from a state ad valorem tax prohibited by article vIll, section I-e.

The district court dismissed the case on the pleadings, holding that a constitutional violation

could not be alleged because far fewer than half of Texast 1,035 school districts were taxing at the

maximum rates aJlowed. The court of appeals affimled, focusing not on bow many districts were

l Carrollton-Fan71en Branch Indep. Sch. Dut. \I. Edgewood lndep. Sch. Di.st., 826 S. W.2d 489, S02 (Tex.

1992) [Edgewood 0/).

'Edgewood Indep. Sch. Dirt. v. MellO, 917 S.W.2d 717, 738 (Tex. 1995) [Edgewood lYJ.

41d.

2

taxing at maximwn rates but on whether any of them were forced to do so just to provide an

accredited education as defined by statute.' We disagree with both courts and therefore reverse and

remand the case to the trial court for further proceedings

I

This is the fifth in a series of cases to come bef~ us challenging the constitutionality of the

Texas public school finance system on various grounds.' Central to some of the cases and basic to

them all is article vn. section I of the Texas Constitution, which states:

A general diffilSion of knowledge being essential to the preservation of the libertiesand rights of the people, it shall be the duty of the Legislature of the State to establishand make suitable provision for the support and maintenance of an efficient systemof public free schools.7

By assigning to the Legislature a duty, this section both empowers and obligates. It gives to the

Legislature the sole authority to set the policies and fashion the means for providing a public school

system.. Thus we have said that 8[w]e do Dot prescribe the means which the Legislature must

employ in fulfilling its duty .-9 But the provision also requires the Legislature to meet three

, 78 S. W.3d S29 (Tex. Aw.-Austin 2002)

, Ed~ Indep. Sch. Dirt. Y. Kirby, m s. W.2d 391 (Tex. 1989) [Edpwood /); ~ Indep. SciL Dirt.". Kirby, 804 S.W.2d 491 (Tex. 1991) [;EdB~1I]; Edgewood m,.rI'PI'a note 2; Edgewood JY"rupra DOte 3.

7 TEX. CONST. U1. vn. § 1

. MII",me v. Marrs, 40 S.W.2d 31,36 (Tex. 1931) (.SiDce the Legislature hu the mandatory duty to make

suitable provision for the support and maintenance of an efficient system of public free school.. and bas the power topus any law relative tbcreto, Dot pobibited by the CoosbbJbc... it ~~ follows that it bas a choice in the ~~of methods by which the object of the organic law may be effectuated. The Legislature alone is to judge what meansarc necessary and appropriate for a purpose which the CoD5titution makes legitimate. 1.

, EdgrltlOod //,804 S. W.2d at 498

3

standards. First, the education provided must be adequate; that is, the public school system must

accomplish that "general diffi1sion of knowledge. . . essential to the preservation of the liberties and

rights of the people-. Second, the means adopted must be 8suitable8. Third, the system itself must

be Mefficien~. M[T]hese are admittedly not precise tem1S,. as we have acknowledged, but Mthey do

provide a standard by which this court must, when called upon to do so, measure the constitutionality

of the legislature's actions,-IO The final authority to detennine adherence to the Constitution resides

with the Judiciary.lt Thus, the Legislature has the sole right to decide how to meet the standards set

by the people in article vn, section 1, and the Judiciary bas the final authority to determine whether

they have been met 12

In 1989, we decided Edgewood I, the first case challenging the constitutionality of the public

school finance system under article vll, section 1. The system's principal component for funding

10 Edgewood I, 777 S. W.2d at 394; accord Edgewood lV, 917 S. W.2d at 736.

II Marbury v. Madison, 5 U.S. (1 Crmch) 137, 176-178 (1803) (8Jbe powers of the 1egislabUe are defined and

limited; and that d1ose limits may not be mistakm or forgotten, the constitution is written. To what purpose are powerslimited, and to what pwpose is that limitation committed to writing, iftbese limits may, at any time, be passed by thoseintended to be restrained? . .. So if a law be in OWOSition to the CODSIituaoo; ifboth the law and the constitution applyto a particular case, so that the cowt must either decide the case conformably to the law, disregarding the constitution;or confonnably to the constitution, disregarding the law; the court must determiDe which of these confficting rulesgoverns the case. This is of the very essence of judicial duty. 1; Lo'IIe v. W"Ilcox, 28 S. W.2d 515, 520 (Tex. 1930) (.SinceMarbury v. Madison, [5 U.S. (1 Cranch) 137, 166-167 (1803)], the coW1l ofJast resort of the several states have almost

universally followed the opinion of Chief Justice Manhal1 to the effect that it is clear that: 'Where a specific duty isassigned by law, and individual rights depend upon the performance of that duty, . . . the individual who considershimself injured. bas a right to resort to the laws ofhis country for a remedy.'i.

12 Edgewood w, 917 S. W.2d at 726 (8This Court's role under OW' Consti~on's separation of powers provision

should be ODe ofresttaint We do not dictate to the LegisJatwe how to discharge ita duty. As prominent as this Com'srole bas been in recent years on this impo11aDt issue, it is subsidiary to the constitutionally conferred role of theLegislature. The people of Texas have themselves set the standard for their schools. Our responsibility is to decidewhether that standard has been satisfied, not to judge the wisdom of the policy choices of the Legislature, or to imposea different policy of oW" own choosing,-).

4

maintenance and operations was the Foundation School Program, a two-tiered mechanism that the

Legislature had set up in 1975.13 The first tier was designed to fund a basic education. I. Every

school district that could not, by taxing at a specified minimum rate, generate a certain level of

revenue per'student in .weighted average daily attendance8 (.W ADA 8 - weighted by taking into

account special needs and conditions such as special or bilingual education) was given state fun~

to make up the difference. IS Despite its stated purpose, first-tier funding did not cover the cost of

meeting bare educational requirements mandated by the Legislature.16 The system' s second tier

provided state funds to guarantee a certain level of additional revmue per student in W ADA for exh

penny a school district increased its tax rate above the prescribed minimum.11 School district tax

rates were capped at $1.50 per $100 property valuation.' as they bad been for d-~A~..9 Smaller

components of the school finance system were the Available School Fund established by the

IJ Ed~ I, 777 S. W.2d It 392; Edpwood H, 804 s. W.2d It 495; Edgrft/Ood m, 826 S. W.2d It 496; TExASLEGIS LA 11VE BUDGET BoARD, FINAJ«:rNG PuBuc EooCA TION IN TEXAS KlNDBRGARTEN THRoOOH GRADE 12LEGIsLATIVE PRIMER It 25-26 (2d cd. 2000) [hcrciDaftcr LBB PRWER].

14 Edg,WQod 0, 804 S. W.2d at 49S

'S[d.

., Edg,WQod 1. m S. W.2d at 392.

., Ed,~ O. 804 S. W.2d at 495.

.8 Act of June 2, 1969,6151 Lea., R.S.. ch. 889, f I, 1969 Tex. Gen. l.aWI273S, 289S-2896.

I' See Act of May 17, 1945, 49th Leg., R.S.. ch. 304, § I, 1945 Tcx. Gal. LaWl488.

5

Constitution. ZO which provided all school districts about $300 per student, 21 and federal funding.n

Facilities and other expenses were funded separately.23

Then. as now, local ad valorem taxes supplied more than half the funding for public

schools,34 the tax bases of the more than 1,000 school districts, and consequently the tax revenue

available to them, were vastly different, 2S and state tax revenues were inadequate to level local

funding disparities.» At that time. local tax revenues were not redistributed among school districts

as they are now. We described the situation thus:

There are glaring disparities in the abilities of the various school districts toraise revenues from property taxes because taxable property wealth varies greatlyfrom district to district. The wealthiest district has over $14,000,000 of propertywealth per student, while the poorest bas approximately $20,000; this disparity

m TEX. CONST. lit. vn. § S(a) (8TIJe priDa.-I of all bonds and other fImds, and the principallrisiDg from the

sale of llndl hereinbefore set 8put to said school fund, IbaI1 be the pelmlDCDt school fimd, md all the interat derivabletherefrom and the taxa herein authorized md levied Ibal1 be the available ~l fImd. The available school fund sballbe applied annually to the support of the free public schools. 1.

ZI Ed~n. 804 S.W.2d 11495 0.10.

22 Edg~ I, m s. W.2d at 392.

DId.

14ld. ('Of tolal education costa, the state provides about forty-two percent. school districu provide about fifty~ 8Dd die rsn-ifttt ~~ from vario.. other IOUIeea including federal funds. 1; ..- LBB PRIMER. .nIprII Dote13. at 1 (-For the 2000-01 bienniwn, state taxes are estimated to generate approximately 44 ~t of the tolal fundsand loc.aI school district property taxes 47.5 percent of the total. The federalaovernmeot provides approximately 8.5percent of the revenue, most of it e8rm8rked for specific federal education pI'OIIImS.1.

~ Ed~ I, m s. W.2d at 392-393; LBB PRIMER..nIprG DOte 13, It 6 (sIatiDIo u of2000: ~ are 1,035

school districts in the Itate. The tax base 8ID0IIg 1beIe districts varia considerably. K.encdy County Wide ISD bu morethan $3 million in property wealth per enrolled student, while Bola ISD bas less than $10,000 in property wealth perenrolled student 8).

26 Edg~od /,777 S. W.2d at 392;..- LBB PRIMER, mpra note 13, at 21 (stating, as of 2000: ~e nwnber

of districts subject to the recapture provisions range from 85 to 100 in a given year. The associated recapture revenueis anticipated to total 5949.8 million in 1be 2000.01 biennium. j.

6

reflects a 700 to 1 ratio. The 300,000 students in the lowest-wealth schools have lessthan 3% of the state's property wealth to support their education while the 300,000students in the highest-wealth schools have over 25% of the state's property wealth;thus the 300,000 students in the wealthiest districts have more than eight times theproperty value to suppon their education as the 300,000 students in the poorestdistricts. The average !Jloperty wealth in the 100 wealthiest districts is more thantwenty times greater than the average property wealth in the 100 poorest districts. . . .

. . .

Because of the disparities in district property wealth, spending per studentvaries widely, ranging from $2,112 to $19,333. Under the existing system, anaverage of $2,000 more per year is spent on each of the 150,000 students in thewealthiest districts than is spent on the 150,000 students in the poorest districts.

The lower expenditures in the property-poor districts are not the resUlt of lackof tax effort. Generally, the property-rich districts can tax low and spend high whilethe property-poor districts must tax high merely to spend low. In 1985-86, local taxrates ranged from S.09 to SI.55 per SI00 valuation. The 100 poorest districts had anaverage tax rate of 74.5 cents and spent an average of $2,978 per student. The 100wealthiest districts had an average tax rate of 47 cents and spent an average of $7,233per student. . .. A person owning an S80,OOO home with no homestead exemptionwould pay SI,206 in taxes in the east Texas low-wealth district ofLeveretts Chapel,but would pay only S59 in the west Texas high-wealth district of Iraan-Sheffield.Many districts have become tax havens.77

The plaintiffs in Edgewood 1 asserted that this public school finance system ~ not efficient

within the meaning of article vn, section 1. .'Efficimt,'. we said, .conveys the meaning of effective

or productive of results and connotes the use of resources so as to produce results with little waste;

this meaning does not appear to have changed ov~ time,8n Givm these circwnstances, a unanimous

Court had little difficulty concluding that the constitutional standard of efficiency had not been met:

27 Edgewood 1, m s. W.2d at 392-393.

J8 [d. at 395 (citations omitted).

.,

We hold that the state's school financing system is neither financiallyefficient nor efficient in the sense of providing for a 8general diffilsion ofknowledge8statewide, and therefore that it violates article vll, section I of the TexasConstitution. Efficiency does not require a per capita distribution, but it also doesnot allow concentrations of resources in pro-~"j-rich school districts that are taxinglow when property-poor districts that are taxing high cannot generate sufficientrevenues to meet even minimum standards. There must be a direct and closeconelation between a district's tax effort and the educational resources available toit; in other words, districts must have substantially equal access to similar revenuesper pupil at similar levels of tax effort. Children who live in poor districts andchildren who live in rich districts must be afforded a substantially equal opportunityto have access to educational funds. Certainly, this much is required if the state isto educate its populace efficiently and provide for a general diffusion of knowledgestatewide.29

Because constitutional efficiency does not require absolute equality of spending, we

expressly acknowledged that -local communities would [not] be precluded from supplementing an

efficient system established by the legislature., but we added that -any local enrichment must derive

solely from local tax effort. 830 In other words, the constitutional standard of efficiency requires

substantially equivalent access to revenue only up to a point, after which a local community can elect

higher taxes to .supplemen~ and .enrich. its own schools. That point, of course, although we did

not expressly say so in Edgewood I, is the achievement of an adequate school system as required by

the Constitution. Once the Legislamre has discharged its duty to provide an adequate school system

for the State, a local district is free to provide enhanced public education ~rtunities if its residents

vote to tax themselves at higher levels. The requirement of efficiency does Dot preclude local

supplementation of schools. Although we were not called upon in Edgewood I to consider what

a [do at 397.

)lId. at 398,

8

constitutional adequacy entails, the interrelationship between the standards of adequacy and

efficiency was fundamental to our reasoning in that case.

We ordered that state funding of public schools cease on May I, 1990, unless the Legislature

conformed the system to meet constitutional standards}1 Although we expressly did not 8instruct

the legislature as to the specifics of the legislation it should enact . or order it to raise taxes,.» we

cautioned that -[a] band-aid will not suffice; the system itself must be changed. -33 Eight months

later, in a sixth special session, the Legislanue adjusted the system to provide incentives it believed

would 8achieve substantial equity among the districts that ~'!C:-c!.te 95% of our studcnts.834 The

plaintiffs in Edgewood I inunediateiy challenged this legislation, Senate Bill 1. again OD the ground

that the system was not efficient within the meaning of article VB, section 1 of the Constitution.

Without attempting to determine whether the incentives added by Senate Bill I could realistically

reach their goals, we concluded in Edgewood n that the system as a whole remaL~ constitutionally

inefficient:

Even if the approach of Senate Bill I produces a more equitable utilization of stateeducational dollars, it does not ~edy the major causes of the wide opportunity gapsbetween rich and poor districts. It does not change the boundaries of any of thecurrent 1052 school districts, the wealthiest of which continues to draw funds froma tax base roughly 450 times greater per weighted pupil than the poorest district Itdoes not change the basic funding allocation, with approximately half of alleducation funds coming from local property taxes rather than state revenue. And it

)\ [d. at 399; accord Edgrwood II, 804 S. W.2d at 493

u~/.ms.W.2d.t399.JJ [d. at 397.

J4 Edgewood O. 804 SoW old at 49S

9

makes no attempt to equalize access to funds among all districts. By limiting thefunding fonnula to disaicts in which 95% of the students attend school, theLegislature excluded 132 districts which educate approximately 170,000 students andharbor about 15% of the property wealth in the state. A third of our students attendschool in the poorest disaicts which also have about 15% of the property wealth inthe state. Consequently, after Senate Bill I, the 170,000 students in the wealthiestdistricts are still supported by local revenues drawn from the same tax base as the1,000,000 students in the poorest districts.

These factors compel the conclusion as a matter of law that the State basmade an unconstitutionally inefficient use of its resources. The fundamental flaw ofSenate Bill 1 lies not in any particular provisions but in its overall failure torestructure the system. 3'

We rcaffinncd that efficiency did not preclude local supplementation of school funding.36

On rehearing, we stressed:

The current system remains unconstitutional not because any uncqua1iz~ localsupplementation is employed, but because the State relies so heavily on unequalizedlocal funding in attempting to discharge its duty to -make suitable provision for thesupport and maintenance of an efficient system of public free schools.- Once theLegislature provides an efficient system in compliance with article vn, section 1, itmay, so long as efficiency is maintained, authorize local school districts tosupplement their educational resources if local property owners approve an additionalI ocal property tax. 3 7

B~~~ the Legislature was then in session, we required that it respond without delay, and

it promptly enacted Senate BiIl3S1.3I The legislation created 188 new 8county education districts-

,s [d. at 496.

J6 Id. at 495 0.11 (-ne question of local enrichment continues to be controlled by this Court'. opinion in

Edgewood I, 777 S. W.2d at 397-98.-).

)7/d. at SOO (emphasis in original) (citation aDd footnotes omiUed).

JI Ed~ m, 826 S. W.2d at 492.

10

In most instances, a CED comprised the school districts in a single county ,39 The sole purpose of

dIe CEDs was to levy, collect, and distribute property taxes among their component school districts,

respectively, in effect consolidating school districts' tax bases while leaving them in control of their

own schools. ~ CED tax rates and distributions were prescribed by statute to ensure unifonnity. This

state-controUed tax-base consolidation Mreduced the geographical disparities in the availability of

revenue for education"' and was not challenged as failing to satisfy the efficiency standard of article

VB. section 1. It was. however. challenged as imposing a state ad valorem tax in violation of article

vm. section l-e of the Constitution. We sustained that challenge in Edgewood m:

Senate Bill 351 mandates the tax CEDs levy. No CED may decline to levythe tax. The tax rate for aU CEDs is predetennined by Senate Bill 3S I. No CED cantax at a bigb~ rate or a lower rate under any circwnstanccs. Ind~ the very purposeof the CEDs is to levy a unifono tax statewide. The distribution of the proceeds isset by Senate Bill 351. No CED bas any discretion to distn"bute tax proceeds in anymanner except as ~ by statute. Every function of the CEDs is purelyministerial. If the State mandates that a tax be levied, sets the rate, and prescribes thedistribution of the proceeds, the tax is a state ~ regardless of the instnuncntalitywhich the State may choose to USC.42

To place the siOlation created by Senate Bill 35 I in the broader context of the. constitutional

prohibition of state ad valorem tax. we explained:

An ad valorem tax is a state tax when it is imposed directly by the State orwhen the State so completely controls the levy, assessment and disbursement ofrevenue, either directly or indirectly, that the authority employed is without

'9 [d. at 498.

-1d.

4. [d. at 500.

G [d. (citation and footnote omitted)

11

meaningful discretion. How far the State can go toward encouraging a local taxingauthority to levy an ad valorem tax before the tax becomes a state tax is difficult todelineate. Clearly, if the State merely authorized a tax but left the decision whetherto levy it entirely up to local authorities, to be approved by the voters if necessary,then the tax would not be a state tax. The local authority could freely choose whetherto levy the tax or not To the other extreme, if the State mandates the levy of a taxat a set rate and prescribes the distn'bution of the proceeds, the tax is a state tax,irrespective of whether the State acts in its own behalf or through an intermediary.Between these two extremes lies a spectrum of other possibilities. If the Staterequired local authorities to levy an ad valorem tax but allowed them discretion onsetting the rate and disbursing the proceeds, the State's conduct might not violatearticle vIll, section l-e. It is difficult, perhaps impossible, to define for everyconceivable hypothetical precisely where along this continuum such taxes becomestate taxes. Therefore, if the Legislature, in an effort to remedy Senate Bill 3S I withas few changes as possible, chose to inject some additional element of leeway in theassessment of the CED tax, it is impossible to say in advance whether that elementwould remove the tax from the prohibition of article vm, section l-e. Each casemust necessarily turn on its own particulars. Although parsing the differences maybe likened to dancing on the bead of a pin, it is the Legislature which bas created thepin, summoned the dancers, and called the tune. The Legislature can avoid theseconstitutional conundra by choosing another path altogether."

We also held that by levying a tax without an election, the CEDs violated article vn. section 3(e)

of the COnstitution.44

We delayed enforcem=t of our niling for more than a year, until the end of the next regular

session of the Legislarure in 1993.4' During that session, the Legislarure's tint reaction was to

U [d. at S02-S00.

.. Id. at 506; Sft !EX. CONST. art. VB. § 3(e) (~e LegislatuR shall be authorized to pea laws for the

assessment and collection of taxes in aU school diltricts and for the management and control of the public school orsclx>Ols of IUC;b diltricts, whether such districts ~ co~ of territory whoUy within a county or in parta of two ormore counties, and the Legislature may authorize an additioaal ad valorem tax to be levied and coUected withm aUschool districts for the further maintenance of public free ~1s, IDd for the er=on - .pneot of 8:Iloo1 OOildingstherein; provided that a majority of the qualified voters of the district voting at an election to be held for that purpose,shall approve the tax. 8).

4S Edgewood U, 826 sw2d at S22-sn.

12

attempt to amend the Constitution. A proposed amendment that would have rewritten article W,

section I to remove its standards and conunit the responsibility for public education to local school

districts was introduced but Dot reported out of committee." A proposed amendment that would

have authorized the system structured by Senate Bill 3S 1 passed the Senate and narrowly passed the

House47 but was soundly defeated by the people before the session ended. 41 The Legislature then

enacted Senate Bill 7.49

Senate Bill 7 returned to the two-tiered Foundation School Program. $0 the buic structure of

which remains in place today." As before, M(t]hc stated purpose ofTi=: 1 is to guarantee 'sufficient

financing for all school districts to provide a basic program of education that meets accreditation and

other legal standards. '.52 At a minimum $0.86 tax rate, a school district that cannot generate revenue

equal to a "basic a11otmcn~ per student in WADA-in 1993, $2,300,'3 and today, $2,537," subject

46 Tex. HJ. Rea. 10, HJ. ofTex., 13rd LeJ., KoS. 184 (1993).

47 Tcx. SJ. Res. " 13rd lei., R.S., 1993 Tex. OeD. Laws 5560 (passed Senate 21-41nd House 102-43).

.. YotuonProposedAmerldmentr to tire TQQ.S o'lI.rtiIutioIt 1875 -May, 1993, at 21, repriIIIed in [4] 1993 Tex.

Gen. Laws (amendment submitted May 1, 1993, defeated 155,411 to 1,293,224); EdgrIIJOod /Y, 911 S.W.2d at 121.

.. Act of May 28, 1993, 73n1 Lei., R.S., ch. 347,1993 Tex. Ocn. Lawl 1479 [hereinafter C1Jap1er 347]; see

Edgewood lY, 917 S.W.2d at 727.

50 Edgrf4'Ood /Y. 917 S. W.2d 81 727

5. LBB PRIMB. supra Dote 13. at 2.

52 Edgewood !Y, 917 S. W .2d It 727 (quoting fonner TEx. BDUc. CoDE § 16.002(b), Chapter 347, mprG note

49, at 1492, now TEX. EDUC. CoDE f 42.002(bXIXA»;.fa LBB PRJNER, mprG note 13, at 2.

II Cbaptcr 347, supra Dote 49, at 1498 (codifying fonncrTEx. BDUc. CODE § 16.101)

,. TEX. BDtx:. CODE f 42.101

13

does not cover the cost of an education that meets legislated accrediting standards.57 Tier 2 provides

sometimes referred to as Tier 3 in the systcm.62

SS LBB PRIMER, silpra note 13, at 14-16.

58 Sa LBB PRIMER. supra note 13, at 2.

at 1514).

. TEX. EDUc. CODE § 42.302;.fee LBB PRIMER..rupro note 13, at 16-17.

62 See LBB PRIMER. supra DOte 13. at 2, 19-20.

14

$280,000 in 1993," and $305,000 today" - must transfer the excess, or the tax revenue generated

from it, either actt1ally or effectively t so as to provide funding for school districts with less wealth. 66

The local tax revenue Mrecaptured8 and redistributed by this mechanism amO\Ulted to almost S I

billion in 2000.67 This taxable wealth equalization scheme, dubbed by some MRobin Hood-,

eliminates the geographical disparities in available revenue among school districts that characterized

the pre-I993 venion of the Foundation School Program

The public school finance system set up by Senate Bill 7 was challenged on numerous

grounds, all of which we rejected in Edgewood /Y. Two are important for purposes of the present

case. We held that the UDequalized funding available for local supplementation did not render the

system constitutionally inefficient:

It is apparent from the Court's opinions that we have recognized that anefficient system does not require equality of access to revenue at all levels.Otherwise, unequalized local supplementation, which we expressly approved inEdgewood n, could never be justified. Article vn, section 1 of the Constitution andour previous Edgewood decisions mandate that efficiency be measured against bothqualitative and financial stan~.

I§ 41.001-.002; LBB PRIMEK. supra note 13, at 20021

.. EdarNood /Y. 917 S.W.2d at 728 {citinl formCl'!EX. Eooc. CODE § 36.002, ~~ 347,.nIprtI Dote 49,

at 1480).

"TEX. Eooc. CODe t 41.002; LBB PRIMEKo nlpl'4 DOte 13, at 21

M ~ /Y, 917 S. W.ld at 728 (ciliDl f~ TEX. ~ CODE II 36.003-.004, Chapter 347,.nIpra note

49, at 1480); TEX. Boo(:. CODE If 41.003-.004 (requiring that a scbool diItrict with excess wealth per scudeot effec:tuate. reduction by ODe M'more of the foUowinl: consolidation with mother district, detachment of territory, purchase ofaverDIC daily attendance ~t, education of nonresident students, or tax bue consolidation); LBB PRIMER, .S1lpra note13,at21.

6' LBD PRIMER. svpru Dote 13, at 21.

1~

The district court viewed efficiency as synonymous with equity, meaning thatdistricts must have substantially equal revenue for substantially equal tax effort at alllevels of fimding. This interpretation ignores our holding in Edgewood n thatunequalized local supplementation is not constitutionally prohibited. The effect ofthis Mequity at alllevets- theory of efficiency is to Mlevel-down- the quality of ourpublic school system, a consequence which is universally regarded as undesirablefrom an educational ~~~-tive. Under this th~ry, it would be constitutional for theLegislature to limit all districts to a funding level of $500 per student as long as therewas equal access to this $.500 per student, even if$3S00 per student were required fora general diffusion of knowledge. Neither the Constinltion nor our previousEdgewood decisions wanant such an interpretation."

Constitutional efficiency under article vn, section 1 requires only that Mdis1ricts must have

substantially equal access to funding up to the legislatively defined level that achieves the

constitutional mandate of a general diffusion of knowledge."" That legislatively defined level was

an accredited education:

In Senate Bill 7, the Legislature equates the provision of a -general diffusionof knowledge. with the provision of an accredited education. The accountabilityregime set forth in [the StabJtc], we conclude, meets the Legislature's constitutionalobligation to provide for a general diffusion of knowledge statewide.70

We cautioned, however, that the Constimtion docs not give the Legislature a completely free hand

in detennining what level of education will achieve the general diffilSion of knowledge required by

article vll, section I:

As long as the Legislature establishes a suitable regime that provides for a generaldiffusion of knowledge, the Legislature may decide whether the regime should beadministered by a state agency, by the districts themselves, or by any other means.

II Edgewood /Y, 917 S. W .2d at 729-730 (empbuiJ in original).

. Id. at 730; QCCOn/ #d. at 731 <-The S~'. duty to JXOvide disttidI with substanOally equal access to revenue

applies only to the provision of funding DeceIIaIy for. general diffilsion ofkDowledie.8).

70 Jd. at 730.

16

This is not to say that the Legislature may define what constitutes a generaldiffilSion of knowledge so low as to avoid its obligation to make suitable provisionimposed by article vn, section 1. While the Legislature ceI1ain1y bas broaddiscretion to make the myriad policy decisions concerning education, that discretionis not without bounds.71

The interrelated constitutional standards of efficiency and adequacy both limit legislative discretion:

As long as efficiency is maintained, it is not unconstitutional for districts tosupplement their programs with local funds, even if such funds are unmatched bystate dollars and even if such funds are not subject to statewide recapture. Wecaution, however, that the amount of.supplemmtation. in the system cannot becomeso great that it, in effect, destroys the efficiency of the entire system. The danger isthat what the Legislature today considers to be .supplementation- may tomorrowbecome necessary to satisfy the constitutional mandate for a general diffusion ofknowledge. n .

MThis is simply another way of saying that the State's provision for a gmeral diffilSion of knowledge

must reflect changing times, needs, and public expectations,-"

In Edgewood IV, we also held that Senate Bill 7 did not impose a state ad valorem tax in

violation of article ~ section l-e of the Constitution simply because a number of school districts

were already taxing at the maximum S 1.50 rate. Some districts were taxing below the minimum

SO.86 rate, and it appeared that for the most part 8[p]roperty-poor and property-rich districts

presently can attain the revenue necessary to provide suitably for a general diffusion of knowledge

71 Id. at 730 D.8 (citatiOD omitted).

7J [d. at 732 (emphasis in original).

7Jld. at 732 0.14; cf.~v. Man 40 S.W.2d31, 36 (fa. 1931) (-ne word 'suitable,' used in coDDCCtionwith the word 'provision' in this lCction of the Constitution, is an elutic term, depending upon the ncccssities ofchanging times or conditions, and clearly leaves to the LcIisJa~ the right to detcrmine what is suitable, and itsdetcnnination will not be reviewed by the cow'll if the act hu a real relation to the subject and object of theConstitution.8 (citation omitted».

17

at tax rates of approximately $1.31 and $1.22, respecbvely..7. We acknowledged, however, that over

time more districts would be required to tax at the maximum $1.50 rate:

if the cost of providing for a general diffilsion of knowledge continues to rise, as itsurely will, the minimum rate at which a district must tax will also rise. Eventually,some districts may be forced to tax at the maximum allowable rate just to provide ageneral diffusion of knowledge. If a cap on tax rates w~ to become in eff= a flooras well as a ceiling, the conclusion that the Legislature bad set a statewide ad valoremtax would appear to be unavoidable because the districts would then have lost allmeaningful discretion in setting the tax rate.75

Although we rejected all of the challenges to Senate Bill 7, we stressed that the system was

-minimally acceptable only when viewed through the prism of history .876 In other wo~. it was

better than it had been. But we added: .Surely Texas can and must do better..'" In every session

since 1993, the Legislature bas amended the Education Code," but little change bas been made in

funding the maintenance and operation of public schools. As noted, the Tier 1 basic allotments, the

Tier 2 guaranteed yields, and the equalization threshold have all been increased, thereby providing

more state funds for public education, but the structure of the system remains essentially the same.

Meanwhile, the level of state funding has continued to fall, reliance on local property taxes has

14 Ed,.wood IY, 917 S. W.2d at 731 (footnote om,itted)

15/d. at 738.

" [do at 726.

" [d.

71 s.c Act of May 27, 199', 74th Leg., R.S.. cb. 260,199' Tn. Gen. Laws 2207; Act of June 1, 1997, 75th

Leg.. R.S., cb. 1071, 1997 Tex. Gen. Laws 4087; Act of May 30, 1999, 76th Leg., R.S., cb. 396, 1999 Tex. Gen. Laws2471; Act of May 28, 2001, 77th Lea-, R.S., cb. 1187,2001 Tex. OeD. Laws 2667.

18

increas~ 79 and more school districts - now 39% with 32% of the State's 4.1 million students,

according to petitioners' calculations from data furnished by the Texas Comptroller - have reached

maximum tax rates.

PreseientJy. we observed in Edgewood IV: .Our judgment in this case should not be

interpreted as a signal that the school finance crisis in Texas has ended. 8m

D

In the case now before us, filed in April 200 I, four school districts'. assert that the public

school finance system bas come to involve a state ad valoran tax in violation of article vm, section

l-e,just as we foresaw it might in Edgewood JV.12 Specifically, after quoting our admonition from

Edgewood IV. the plaintiffs alleged:

In the six years since the 1995 Edgewood lV decision, education costs have continuedto rise. As predicted in Edgewood lV, school districts, such as the Plaintiffs, arerequired to tax at or near the maximum allowable $1.50 M&O [maintenance andoperation] tax rate in order to educate students in their districts. Such school districtshave lost all meaningful discretion in setting their M&O tax rate. Accordingly, ascontemplated by the Supreme Court in Edgewood lV, the statutory cap on the M&Otax rate has become a statewide ad valorem tax in violation of the Texas Consti~tion.Without relief from the statutory cap on M&O tax rates, the Plaintiff school districtsmust continue to take such measures as cutting programs, eliminating teachingpositions and/or increasing class size.

" TEXAS LEOISLA 11VE BUDGET BoARD, FDl/ANCINO PuBuC BDUcA nON IN TEXAs KINDERGARTEN 'nIR.OUGH

GRADE 12 LEGISLATIVE hJMER. at 1 (3d cd. 2001).

. Edgewood /Y. 917 s.W.2d at 725.

8. West Orange-Cove Consolidated I.S.D., CoppeU I.S.D., La POr1e LS.D.. and Port Necbes-Oro~ LS.D.

11 See .rupra note 7S aDd ICCOIDplDying texl

10

Plaintiffs prayed for a judgment declaring the $1.50 statutory cap to be a(Emphasis added,

constitutionally prohtoited state ad valorem tax.

The defendantsl3 (collectively. -the State-) answered with a plea to the jurisdiction, plea in

abatement, and special exceptions, asserting that the action was not ripe and should be dismissed.

Specifically, the State asserted:

8fue system would not result in a statewide ad valorem tax Wllcss and until the 'cap on taxrates were to become in eff~t a floor as well as a ceiling' [quoting Edgewood IV, 917S. W .2d at 738] as to all districts8 (emphasis added), and plaintiffs do not and cannot allegethat this is the situation;

-Plaintiffs do not allege that the system requires them or any other district to tax at the rateof S 1.50 in order to provide a general diffusion of knowledge» (emphasis in original) as theymust to allege a constitutional violation, ~ut instead allege only that they must tax at (ornear) $1.50 'in order to educate students in their districts-; and

because -each of the Plaintiff districts. . . has voluntarily elected to grant an optional twentypercent homestead exemption. . . they cannot plead or prove that the State system forcesthem to tax at $1.50 just to provide an accredited education.8

The State's ripeness and pleading arguments were thus related: in the State's view, the claims the

plaintiffs were required to plead in order to state. the constitutional violation they asserted were not

npe.

In response. the plaintiffs argued that:

to show a state property tax they were required to prove only that some, not all, schooldistricts were forced to tax at maximum rates;

IJ Felipe Alania, in bja official ~ty u the ~1UL~oocr ofEducaboa; Tau Educaticm AaCllCy; Carol

Keeton Snyhom. in her official capacity u Tau CompttoUcr of Public Accounts; and Tau State Board ofEducation.

20

although the defendants contended that an accredited education could be provided for $4,179per student, plaintiffs were entitled to explore the factual basis for that figure and to showthat taxation at maximum rates was required to provide an accredited education; and

. homestead exemptions should not be taken into account in determining whether schooldistricts were being forced to tax at maxim1D1l rates..

The plaintiffs contended that their pleadings were sufficient and stated claims that were ripe.

Two groups of school districts intervened. While they opposed the plaintiffs' claims, they

alleged that the public school finance system remained flawed for other reasons. The six Edgewood

intervenorsl4 asserted:

The Edgewood Intervenors are Defendant Intervenors to the extent that theyagree that this case should be dismissed for lack of ripeness and, therefore, lack ofsubject matter jurisdiction. On the other band, Edgcwood Intervenors arc Cross-Plaintiff Intervenors to the extent that they agree that the Texas School FinanceSystem at $1.50 docs not provide sufficient funding or equitable funding to guaranteea gen~ diffusion ofknowlcdge.

The thirty-four Alvarado intervenors" asserted: -In spite of the fact that progress is being made,

Intervenon do not concede that the funding levels for Ti~ 2 districts set by the legislature achieves

an adequate level of funding for public schools in Texas.- They added that Mthe state is not

contributing its fair share of monies needed to maintain an adequate school finance system..

Regarding the plaintiffs' claints, they agreed with the defendants that they should be dismissed:

.. Edgewood I.SD., Yllela LSD., Lareck) LSD., SID HJjzario LSD., Socc;u.-.v LSD., 8Dd South San Antonio

LSD.

u A1~ I.SD.. Antbony LSD., Aubrey !.SD.. BaDIS LSD., BeUa LSD., CommUDity I.SD.. Cooper LSD..

COVingtOD I.S.D., Detroit I.SD., Early I.S.D., Fan_niM~II.SD., Hutto I.SD., ICama City LSD., Xaufman I.SD.,KirbyviUe I.S.D., KnDD LSD., La Joya !.S.D.. M~ LS.D.. Meridian LS.D.. New BOlton I.S.D., Nocooa I.SD..Olfeo I.SD., Oraoge Grove I.S.D., Poteet LS.D., Robinson I.SD., Rosebud-Lou I.S.D.. Rusk I.S.D.. Soutbside I.S.D..Tomillo I.S.D., Treotoo I.S.D., Tulia I.SD., Uvaide I.SD., Venus LSD.. and Weaaaford I.S.D.

21

Intervenors view Plaintiffs. case as a pure adequacy claim. As stated above,the $1.50 tax rate cap never becomes a factor unless total revenues available toschool districts arc inadequate to provide for a general diffusion of knowledge.Intervenon believe that the maintenance of an equitable system is the best way toinsure adequacy.

The Alvarado intervenors specially excepted to the plaintiffs. pleading for alleging only that

they were required to tax at maximum rates "to educate their students8 rather than 8to provide the

constitutionally-required general diffilsion of knowledge to their studmts.- The plaintiffs responded:

This special exception mischaracterizes Plaintiffs' pleading and constitutesmmccessary hairsplitting over semantics. [plaintiffs quoted from Edgewood IV and]then made clear that their cause of action was based on the [quoted] language, andthat they arc required to tax 8at or near the S 1.50 M&O tax rate in order to educatestudents in their districts8, i.e., to provide a ga1eral diffusion of knowledge. Becausethe 8floor- described by the Court [in Edgewood m is linked to the 8generaldiffusion of knowledge8 standard, Plaintiffs were implicitly (if not explicitly)alleging that they had to tax at or near S 1.50 just to provide their students with ageneral diffusion of knowledge.

Ten weeks after the case was filed, the trial court conducted a hearing on the dilatory pleas

and the special exceptions. The defendants argued, and the trial court agreed, that this Court's

admonition in Edgewood IV that the finance system could result in a state property tax was dicta. 16

The plaintiffs argued, however, that this Court had described circumstances that could violate the

constitutional prohibition of a state ad valorem tax, and that they were entitled to prove that those

N The ttial ~ IIatcd in ill (Xdcr. ~ cbaD&eck:jJQDnIf8DCeI W8minI in ~ IV appears to be obiterdictum. Should the Supreme Cow1 consider the prcsent cue, tbja cow1 respectfully urges 8 reconsideration of thisdictum. F<X' the ~ cited, the co\D1 ba coocans abCMJt the bj*-icallad lDalytical foundations of this dictum. Ofcowwe, dicblm or DOt, the court today baa faitbfuUy followed the teachinp of the Supreme Court, heeded the changed-circumstances warning. and applied the meanmgfuJ-discretion tell .

22

circumstances had come into existence. Regarding the plaintiffs. pleadings, the following colloquy

occurred:

THE COURT: Well, let me ask counsel for the plaintiffs: are you. . .pleading that . . . you can't provide an accredited system on $1.50 or are you pleadingthat the accredited system isn't good enough to provide a general diffusion ofknowledge and you can't provide a general diffusion of knowledge on S I.S0?

COUNSEL: All oftbe above. All the above.. .. And again. we're involvedin notice pleading. We pled it It's pretty clear what we're driving at We're drivingat page 738 of the Edgewood flY] majority opinion.

The trial court did not hear evidence but did take judicial notice of state appropriations and school

district tax levies.

Less than a month later, the trial court issued an order dismissing the case. The court

explained in the order:

Whether the Legislature bas imposed a stale ad valorem tax is decided by referenceto bow the public school finance system works throughout the state, not by referenceto how the system works in anyone district. Moreover, to look at the questiondistrict by district would mean that the tax could be constitutional in one district andunconstitutional in another. Thus, the court must assess the system as a whole.

.

Remember that the constitutional question is not how many districts are at the cap,but how many districts must be at the cap to provide an accredited education. Thecourt today is merely holding that a plaintiff must be able to plead that somesignificant number of districts are at the cap to go forward with a claim that toomany districts must be at the cap. Naturally, the court has assumed on specialexceptions that if a district is at the cap, the district must be at die cap. This pleadingassumption builds in a significant margin of error in favor of the plaintiff districts.

The margin of error is in favor of the plaintiff districts because, on the merits,the plaintiffs must show that the highly-acclaimed school districts taxing at $1.50would plummet to academically-unacceptable school districts at $1.49.

23

. .

Though Edgewood IV provides limited guidance on how many districts must haveto tax at the cap to be constimtionally significant, or, in other words, for the court toconclude that the districts have lost 8meaningful discretion8 in levying the ad valoremtax, based upon what the Supreme Court does teach, this court bolds that for theapproved tax to become a prohibited state ad valorem tax, some significant numberof districts across the state must have to tax at the $1.50 cap in ord~ to provide anaccredited education. For the legislative design to be an unconstitutional state advalorem tax, the design must require a significant number of districts to tax at thecap, something approaching or exceeding half the districts.

Thus, a single number decides the case on special exceptions - the

percentage of districts that are at the cap of S 1.50. The plaintiffs do not and cannotstate a claim upon which relief can be granted because a constitutionally insignificantnwnber of districts are at the cap of S 1.50. Only 1 ~/O of the school districts even taxat the cap of 51.50, which means that 81% do nol IIlrleed, two of the plaintiffdistricts do not tax at the SI.50 rate. Moreover, many districts, including all fourplaintiffs, have granted local-option tax exemptions. Only 12% of the schooldistricts tax at the cap of S 1.50 without a local-option exemption, which means that88% do nol

Of course, the decision to grant a local.option exemption in and of itself is theexen:ise of meaningful local discretion. By granting a local-option exemption, forwhatever worthy reason, a school district takes a great amount of taxable wealth outof the system. . .. The court is not implying that these exemptions are notappropriate; the court is merely saying that they have the same eff~ as substantiallylowering the tax rate. As long as a district has an exemption, therefore, it is not at thetax cap.

The court dismissed with prejudice the plaintiffs. allegation of an existing violation of article vm,

section l-e, and dismissed without prejudice the plaintiffs' allegation that a violation was imminent

The court of appeals affinned, 17 but not for the reasons given by the trial court. Although

the court of appeals considered the pleading and ripeness issues separately, it recognized that the

8' 78 S. W 3d 529 (Tex. App.-Austin 2002)

24

parties' arguments on both issues are related. In the court of appeals' view. the number of school

districts taxing at maximum rates was ilrelevant .Whether the effect of the tax is experienced

'statewide' or by a majority of districts in the state does Dot determine whether a tax is a state tax. ..11

Rather, the court said, -the controlling factor in reviewing a challenge to an alleged ad valorem tax

is the State's involvement in the levy.8" .Seen in this light, 8 the court said, .the positions taken by

the district court . . . and by the parties in their briefs, are based on a misunderstanding of the

detemtinative factors of a state ad valorem tax. ~

Regarding the plaintiffs' pleadings, the court explained:

In detennining the State's control over the maintenance and operationsproperty tax, the relevant inquiry is the relationship betw~ the tax and the districts'obligations to provide an accredited education. As the court found in Edgewood IV.the system may encourage districts to tax at or near the maximum rate. Whether itdoes so is irrelevant for pwposes ofdeterm ming whether the system imposes a statetax. But if the districts' abilities to fulfill a state mandate, here the obligation toprovide the minimum accredited education. forced the districts to tax at themaximum rate. the system might approach an 1D1Kceptable level of state control overthe levy. Therefore. the allegation that a district is forced to tax at the highestallowable rate to provide the bare. accredited education is a necessary element of acause of action brought by a district challenging the cap.9! .

The court concluded that the plaintiffs bad failed to make this allegation:

West Orange-Cove instead pleaded that it was fo~ to tax at or near $1.50 to8educate its students.8 The enriched education that West Orange Cove locallydesires to provide its students is not the measure for determining if the State is

II [d. at 542 (emphasis in original).

. [d.

M [d.

'I 14 at 539.

2S

imposing an educational mandate that requires the locaJ district to levy a state-imposed rate of tax. West Orange-Cove's pleadings simply fail to state a viablecause of action.92

Because the plaintiffs'

allegation does not refer to dIe districts' state-imposed obligation to provide anaccredited education. . . , the districts' pleadings fail to state a challenge to the taxas a Slale tax. Accordingly, we hold that the trial cowt properly dismissed the claimfor failure to state a cause of action. 93

The court also held that the plaintiffs' claim that taxation at maximum rates was necessary

to achieve the constitutional standard ofMa general diffusion of knowledge. was DOn justiciable:

As the record makes clear, West Orange-Cove wants to use this opportunity,framed as a tax challenge, to engage the judiciary in a debate over policy choices thatare within the province of the legislative branch. Both the Legislature and thesupreme court have equated the tcnn .general diffilsion of knowledge- withaccreditation standards. The court, in addition, has insisted that the judiciary has alimited role in the area of educational policy and should defer to the Legislature onmatters involving educational standards and funding. . . [citing Edgewood JY, 917S.W.2d at 726]. West Orange-Cove's claim would involve the courts in decidingwhat is meant by the tcml -general diffusion of knowledge. without reference to theaccreditation standards set by the Legislature. That body, however, has conclusivelyequated the two concepts, thereby f~losing the judicial inquiry W cst Orange-Coveseeks to pursue. Moreover, as the supreme court has recognized, the meaning of a8general diffusion of knowledge8 and the development of apprupriate accreditationstandards are policy choices best suited to the legislature. /d. N

Summarizing its holdings, the court of appeals stated:

The instant case is not unripe because fewer than half of all school disUicts are taxingat the maximum rate; rather, the claim is unripe because the appellants have failed

~1d.

"[d. at S4O (emphasis in origiDaJ).

26

to demonstrate that they arc forced to set their rates of tax at the maximum allowablerate just to provide an accredited education. That is. the districts have not pleadedthat they have lost all meaningful discretion in setting the rate of tax as it penains totheir ability to meet a state-imposed obligation. which is the only relevant concernin this lawsuit 95

We granted the plaintiffs' petition for review and expedited oral argument.96

m

We consider first what the plaintiffs must allege to state a violation of article ~ section

l-e, and then whether the plaintiffs can and do make that allegation.

A

We adhere to the role stated in Edgewood m that 8( a]n ad valo~ tax is a state tax when it

is imposed directly by the State or when the State so completely controls the levy, assessment and

disbursement of revenue. either directly or indirectly. that the authority employed is without

meaningful discretion. 8" The detcnnining factor is the extent of the State's control ov~ the taxation

process.

The State argues that local school district property taxes cannot be a state tax unless every

district is forced to tax at a specific rate. here, the maximum $1.S0 rate for maintenance and

operation (subject to adjustments). The trial cow1 rejected this argument but held that there can be

no state tax unless most districts are forced to tax at maximwn rates. Both positions presuppose that

"[d. at 542.

M 46 Tex. Sup. Cl J. 426, 428 (Feb. 13,2003).

"Ed,.MiOod m. 826 S. W.2d at SO2.

27

the issue is the extmt of the tax and that the determination must be made ftom the perspective of the

system as a whole rather than with respect to each district. As the trial court stated: 8Whether the

Legislature has imposed a state ad valorem tax is decided by reference to how the public school

fmance system works throughout the state, not by reference to how the system works in anyone

district.- This premise has no support in the constitutional text or the rule we have stated for

applying it The Constitution prohibits .State ad valorem taxes . . . upon any property within this

State- (empwis added) and is not limited to statewide ad valorem taxes. The provision expressly

contemplates that a state ad valorem tax could be levied on only some property. The prohibition

does not permit the State to set rates for hospital districts, or junior college districts, or mosquito

control districts, or fire prevention districts, or noxious weed control districts - to name but a few

of the many taxing authorities" - just because such districts are confined to a few areas of the State,

nor ~ the Constitution pennit the State to control the tax rate for even one such district. Were it

otherwise, then as we observed in Edgewood m:

The State could create County Highway Districts, or County Prison Districts, or all-purpose County Funding Districts to levy taxes at set rates for ~cribcd purposes,and by such means accomplish what it could not do itself."

The concern is not the pervasiveness of the tax but the State's control ofil A state ad valorem tax

is just that - one imposed by the State, whether it acts directly or through control of another entity,

and whether the tax falls on the entire population or only a few.

. s. TEX. TAX CODE f 1.04(12).

" Ed~ m, 826 S. W.2d at SOl

28

Thus, a single district states a claim under article vm, section l-e if it alleges that it is

constrained by the State to tax at a particular rate. How a constitutional violation in one or a few

school disnicts would impact the public school finance system as a whole is not before us.

B

The State argues that for four reasons the plaintiffs cannot allege that they are forced to tax

at maximum rates. To sustain the dismissal of the plaintiffs' case on the pleadings, however, the

State must establish the plaintiffs' inability to plead a constimtional violation as a matter of law.loo

We examine each of the State's reasons in turn.

1

The State asserts that it exerts no control over taxation by local school districts and that the

districts are free to tax at any levels they choose up to the maximum. The State's argument runs as

follows. The duty to provide an adequate public education belongs to the Legislature, not local

school districts. School districts are MforcedM to do nothing; they choose to tax and ~.!cat~ at desired

levels. While the State may encourage certain choices, it does not compel them.

This argument, in essence, is that nothing short of virtually absolute state control of ad

valorem taxation violates article vm, section l-e. We plainly rejected the argument in

Edgewood m:

How far the State can go toward encouraging a local taxing authority to levy an advalorem tax before the tax becomes a state tax is difficult to delineate. Clearly, if theState merely authorized a tax but left the decision whether to levy it entircly up tolocal authorities, to be approved by the voters if necessary, then the tax would not be

I~ ~ FrluellllDlIII v. Ryan,960 S. W.2d 656, 658 (Tax. 1998).

29

a state tax. The local authority could freely choose whether to levy the tax or notTo the other exU'eme, if the State mandates the levy of a. tax at a set rate andprescribes the distribution of the proceeds, the tax is a state tax, irrespective ofwbeth~ the State acts in its own behalf or through an intennediary. BetWeen thesetwo extremes lies a Spectnlm of other possibilities. If the State required localauthorities to levy an ad valorem tax but allowed them discretion on setting the rateand .disbursing the proceeds, the State's conduct might not violate article vllI,section I.e. It is difficult, perhaps impossible, to define for every conceivablehypothetical precisely where along this continuum such taxes become state taxes.IOJ

CeI1ainly, the State does not now control taxation by school districts to the same extent it controlled

taxation by the CEDI. But as we have said, the constibltional prohibition is violated whenever state

control denies a taxing authority 8meaningful discretion-,la

The Legislature has deprived school districts of any meaningful discretion to provide an

inadequate education, as indeed it is constitutionally bound to do. The Legislature's duty under

article vn, section 1 is to make suitable provision for a general diffilsion of knowledge through free

public schools. . As long as the Legislature establishes a suitable regime that provides for a general

diffilsion of knowledge, the Legislature may decide whether the regime should be adminis~ by

a state agency. by the districts themselves. or by any other means,.I03 .Certainly. if the Legislature

substantially defaulted on its responsibility such that Texas school children were denied access to

that education needed to participate fully in the social, economic. and educational opportunities

available in Texas, the 'suitable provision' clause [of article vn, section 1] would be violated.8104

101 Edgewood m. 826 S. W.2d 8t 502-503.

10214 81 S02.

IOJ Edg.MlOod /Y, 917 S.W.2d at 730 n.8.

104/d. at 736.

30

-In Edgewood It we reaffirmed that the requirement of suitability is a judicially-enforceable mandate

.'05 A public school system dependent on local districts free to choose not to provide an

adequate education would in no way be suitable. In fact, the Legislature has acted to ensure that that

Chapter 39 of the Education Code, entitled 8Public School Systemis not the' system.

Accountabili~. sets school accreditation standards.lO6 rewards achievement ofthcse standards;07

and imposes sanctions for non-compliance ranging from admonitions to closure of the district. 101

. These provisions are legislated requirements that school districts provide an adequate education, and

they leave no meaningful discretion for districts to do otherwise.

We also rejected the position for which the State now argues in Edgewood 11', expressly

recognizing that school districts could indeed be 8forced8 - our word - by increasing costs 8to tax

at the maximum allowable rate just to provide a general di:ffilsioD ofknowledge.8109 The 8ceiling8,

we said, could become a Mfloor- as well, in which event ~e conclusion that the Legislature had set

a statewide ad valorem tax would appear to be unavoidable because the districts would then have

lost all meaningful discretion in setting the tax rate.8110 The State successfully argued to the trial

IDS [d. at 73S

'M TEx. BDuc. CODE f 39.072

'Of/d. ii 39.091-.112.

I~ Id. § 39.131;". ~!Y, 917 S. W.2d at 729 (~tbaachrmical Jy fail to maintain ~tatiOD

staudards ue subject to penalties, includinl dissolution of the offending school district 8Dd its annexation to anotherdistrict. 8).

J. Edgewood /Y. 917 S. W .ld at 738

110/d.

31

court that these statements were dicta, III but they were an important part of oW' rationale.112 We held

in Edgewood IV that local ad valorem taxes were not state ad valo~ taxes because of then-existing

circumstances that allowed school districts meaningful discretion in setting tax rates, and we

expressly acknowledged that those circumstances could, and probably would, change. That

distinction defmed the reach of the Court's decision in the case. Had we thought that local school

district property taxes could never violate article vm. section l-e, our decision would certainly have

been far easier.

We remain of the view that school districts can be forced by the current system to tax at

maximum rates. An allegation that this has occurred states a claim under article vm, section I-e.

2

Alternatively. the State argues that its only requirement of school districts is that they provide

an accredited education as defined by the Legislature, and that the plaintiffs cannot allege in good

faith that any district is forced to tax at the maximum rate just to meet this requirement. On the

contrary, the State says, school districts taxing at maximum rates do so to provide enhanced

educational opportunities and not merely to maintain accreditation. The court of appeals appears

to have agreed with this argument

II See note 86 supra.

112 See SerNinole TribeofFla. v. FIoridIl. 517 U.S. 44, 67 (1996) (.'A1tbouib ~~~11y dicta,... an impOI1aDt

part oftbe ~'I ratiODale for tbe reIult it reac:be(1] . . . is entitled to IJaIcr weight. . . .'. (quotiDa SMa MetalWorkB:f v. Equal Employment Opportllnily ~ "" 478 U.S. 421, 490 (1986) (O'Connor, J., coDaUriDg»).

32

Again, the State's argument suffers a flawed premise. Accreditation standards are not the

only requirements the State imposes on school districts. As we have just explained, because the

State bas chosen to rely heavily on school districts to discharge its duty to provide a constitutionally

adequate education - that is, -[a] general diffusion of knowledge . essential to the preservation

of the liberties and rights of the people. I 13 - the State must require that school diSbicts achieve this

goal; otherwise, the public school system is not suitable for its purpose. Consistent with its

constitutional duty, the Legislature has stated:

The mission of the public education system of this state is to ensure that all Texaschildren have access to a quality education that enables them to achieve theirpotential and fully participate now and in the fu~ in the social, economic, andeducational opportunities of our state and nation. That mission is grounded on theconviction that a general diffilsion of knowledge is essential for the welfare of thisstate and for the preservation of the liberties and rights of citizens. I I.

We acknowledged in Edgewood IV that the Legislature in 1993 equated an accredited education with

a general diffusion of knowledge and discharged its duty to provide for the latter by demanding

accountability of school districts. I IS But we also insisted that the .State"s provision for a general

diffusion of knowledge must reflect changing times, needs, and public expectations.,116 and that the

II) TEx. CONST. 8rt. VD. § 1

114 nx. BDUc. CODI § 4.00 1 (a),

liS Edg~odlY, 917 S.W.2d at 730 (~SeDate Bill 7, the LeJislatu:e equates the provisioo of. 'generaldiffusion oCknowledp' with the p'OVisioa oCIn accredited education. The accountability regime let forth in Chapter35, we conclude, meets the Legislature'. constitutional obligation to provide Cor a general diffusion of knowledge

statewide.-).

Il'/d. at 732 0.14.

33

Legislature is not the sole arbiter of the constitutional standard. 117 The public school system the

Legislature bas established requires that school districts provide both an accredited education and

a general diffusion of knowledge. It may well be that the requirements are identical; indeed, as in

Edgewood IV, we presume they are, giving deference to the Legislature's choices. But it is possible

for them not to be - an accredited education may provide more than a gmeraJ diffilsion of

knowledge, or vice vena - and because both are binding, a district may allege that taxation at a

maximum rate in order to satisfy either is a state ad vaJorcm tax.

The cowt of appeals concluded that to 8involve the courts in deciding what is meant by the

terD1 'general diffilsion oCknowledge' without reference to the accreditation' standards set by the

Legislature" would 8engage the judiciary in a debate over policy choices that are within the province

of the legislative branch.-". We agree, as we have already explained, that it is outside the scope of

judicial authority to review the Legislature's policy choices in detennining what constitutes an

adequate education, and we emphasize that the courts cannot undertake to review those choices one

by one or attempt to define in detail an adequate education. But once policy choices have been made

by the Legislature, it is the judiciary's responsibility in a proper case to determine whether those

choices as a whole meet the standard set by the people in article vn, section I.

117 Id. at 730 n.8 (~ ia not to say that the Legialatule may define what coDItituta a geueral diffusion ofknowledae so low u to avoid its obligation to make IUitable provision imposed by uticle vn. section 1. While theLegislature ca'Iainly bu t.oad ~cm to make the myriad policy deciaiooa cooc:eming education, that discretion isnot without bowds.8).

III 78 S. W .3d 529, 540 (Tex. App.-Auabn 2002).

34

EVeD if the plaintiffs' claims were limited to taxing to provide an accredited education, there

is no factual record for detennining what the cost of an accredited education is. The plaintiffs urged

in the trial court that they were entitled to discover the State' s evaluation of that cost and to present

evidence that the troe cost is greater. For the trial court, this factual dispute was irrelevant, given

its view that the plaintiffs could not allege a constitutional violation because they could not allege

that half or close to half of all school districts were taxing at maximum rates. But since we have

concluded, as the court of appeals did. that the number of districts taxing at maximum rates is not

determinative of the plaintiffs' claims, the subsisting dispute over the cost of an accredited education

precludes dismissal of the case on the pleadings.

Thus, to obtain dismissal of the plaintiffs' claims on the merits based solely on the pleadings,

the State must establish as a matter of law that the plaintiff school districts are not forced to tax at

maximum rates either to meet accreditation standards or to provide a gcoeraJ diffusion ofknowledge.

The State has done neither.

3S

3

The Legislature has granted a partial homestead exemption from school district taxation. 11'

which a district may increase up to a certain amount at its option, 120 as many districts do. The State

argues that no school district that has opted for an increased homestead exemption can allege that

it is forced to tax at maximum rates because it has meaningful discretion to deny the increased

exemption and tax at a lower rate. The trial court agreed with this argwncot, and the court of appeals

did not address it

We reiterate that to obtain dismissal of the plaintiffs' action based solely on the pleadiBgs,

the State must establish that the mere existence of loca1-option exemptions precludes as a matter of

law the allegation that school distticB are forced to tax at maximum rates. The State has not met this

burden. For one thing, the plaintiffs may be able to show that even without granting additional

homestead exemptions, they could not provide an accredited education or a general diffilSion of

knowledge. For another thing, while school districts obviously have discretion whether to increase

homestead exemptions, it is far from obvious that their discretion is meaningful. By authorizing

local-option homestead exemptions, knowing that some constituencies win insist on them, the

Legislature may actually have increased the pressure on school districts to tax at maximum rates.

In any event, the plaintiffs are entitled to attempt to show that homestead exemptions do not afford

them meaningfuJ discretion.

II'TEX.TAXCODE f 11.13(b)-(c).

I» [d. § 11.13(d)-(f), (D),

36

4

Finally. the State argues that the plaintiffs cannot allege a violation of article vm, section

l-e unless they tax at the applicable absolute maximum rate, not merely near that rate, as apparently

only two ofthc four plaintiffs do. This is simply not the case. The constitutional issue remains the

extent of the State"s control. It may be that a school district taxing at $1.47 instead of$1.S0 has

exercised meaningful discretion, but that is not necessariJy the case. A district taxing a few cents

below the maximum rate that can no longer provide an accredited education or a general diffusion

of knowledge even by raising the rate to the maximum need not do so just to prove the point.

c

The last matter is whether the plaintiffs did plead what they must to allege a violation of

article vm, section I-e. The plaintiffs alleged that they were required to tax at maximum rates -to

educate their students8. In response to special exceptions, the plaintiffs stated that their allegation

was tantamount to pleading that taxing at maximum rates was necessary to provide for a general

diffilsion of knowledge. When asked by the trial court whether the plaintiffs were p)~g that they

could not provide an accredited education or a general diffilsion of knowledge at maximum rates,

counsel responded, 8 All of the above.8 The plaintiffs repeatedly stated that they were pleading that

the situation we foresaw in Edgewood IY would violate article vm, section l-e bad in fact occurrcd.

No reasonable argument can be made that the plaintiffs' pleadings did not put the State on notice of

their claims. Of course, on special exceptions the trial court has discretion to further clarify the

issues to be litigated by requiring the plaintiffs to allege specifically, for example, whether they are

37

taxing at maximum rates to provide an accredited education, or to provide for a general diffilsion of

knowledge, or both, and whether the costs are different

m

We add a few words in response to the dissent.

While .standing, as aFirst: The dissent would hold that plaintiffs lack standing to sue.

component of subject matter jurisdiction, cannot be waived811l and may thus be raised at any time,

the fact that the State bas not challenged the plaintiffs' standing to sue, nor was the standing of any

school district challenged in Edgewood It Edgewood Dt Edgewood mt or Edgewood IVt is some

indication of the weakness of the dissent's argmnent In Nootsie, Ltd. v. Williamson County

Appraisal District, we held that a CO\D1ty appraisal district had standing to seek a declaratory

judgment that the Legislature had unconstitutionally defined open-space land for tax purposes to

include ecological laboratories. 122 We see no difference in the standing of an appraisal district to

assert its claims in Nootsie and the standing of the school districts here. The dissent argues that

Nootsie is at odds with federal standing jurisprudence, but even if it were - something we need not

decide here - the dissent does not explain why any difference between Texas law and federal law

is reason enough for us not to follow our own recent precedent The dissent also argues that because

the plaintiff school districts do not have and do not claim to have a constitutional right to meaningful

121 TU4f A.u '. of BII$. V. TU4f Air Colltrol Bd., 852 S. W.2d 440, 445-446 (Tex. 1993).

In 925 S.W.2d 659, 661-662 (Tex. 1996) (clUng RobbilLr v. LilllatOM CoIUlly,268 S.W. 915, 917 (1925)

(holding that county and road dimcts can sue the state hipway commission on the ground of the invalidity ofstatutes».

38

discretion, they have no standing to seek a determination that taxation at maximum rates is a

constitutionally prohibited state ad valorem tax. Again conceding the premise solely for argument

purposes. we fail to see how the declaration the school districts request in this case is any different

from the one the appraisal district requested in Nootsie. As we explained in Nootsie, the argument

that

the district bas no inherent vested rights protected by the Constitutions of Texas andthe United States. .. misses the maIk because the district does not contend that thestatute violates constitutional rights belonging to the district Instead, the districtasserts an interest because it is charged with implementing a statute that it believesviolates the Texas Constitution. This interest provides the district with a sufficientstake in this controversy. . . that the declaration sought will resolve. 123 .

Finally, the dissent argues that Nootsie can be distinguished because there the appraisal district

represented aligned interests while here the plaintiff school districts represent disparate and

conflicting interests. We do not understand this distinction. Nootsie allowed an appraisal district

to challenge the constitutionality of a tax exemption that at least one of its taxpayers, Nootsic, Ltd.

claimed and others may have opposed. We fail to see how the interests of the taxpayers and citizms

in the appraisal district in Nootsie were any less at odds than the interests of the taxpayers and

citizens in the plaintiff school districts are here. For the same reasons we explained in Nootsie, we

hold that the plaintiff school districts in this case have standing to assert their claims.

Second: Contrary to the dissent's assertion, we do not hold that school districts have a

constitutional duty to provide for a general diffilsion of knowledge. The districts' obligation is

imposed by the LegislattD'e, not the Constitution, as the passage of our opinion to which the dissent

IU [d. at 662 (citations omitted).

39

changed our minds on matters that have been crucial to the development of the public education

system would not only threaten havoc to the system, but would, far more importantly, undcnnine

the rule of law to which the Comt is firmly pledged.

Fourth: The dissent argues that this Court's consttuction of article W, section 1 since

Edgewood I and perhaps dating back to Mumme v. Marrs'~ necessarily draws the judiciary into

making detailed policy decisions about the elements of an adequate education. We reiterate that the

Constimtion requires, not that courts make such policy decisions, but that they detemline, in a proper

case, whether the Legislature on the whole has discharged its constitutional duty,

* . *

For these reasons, we conclude that the lower courts ~ in dismissing the plaintiffs' action

on the pleadings. The judgment of the court of appeals is reversed and the case is remanded to the

trial court for further proceedings consistent with this opinion.

Nathan L. HechtJustice

Opinion delivered: May 29. 2003

125 40 S.W.2d 31, 36 (Tcx. 1931) (rrhe legislative determination of the methods, resUictions, and regulations

is fina1. except when 10 arbib'ary as to be violative of the constitutional rights of the citizen. ").

41

SUMMARY OFWEST ORANGE-COVE CONSOLIDATED

INDEPENDENT SCHOOL DISTRICT, ET AL.V.

ALANIS, ET AL

David ThompsonPrepared May 28, 2003

I. The Court's Opinion

IntroductionA.

On March 27, 2003, the Supreme Court of Texas issued its anticipated opinion in West

Orange-Cove Consolidated ISD v. Alanis, the fifth decision by the Court since 1989 concerning

the constitutionality of the Texas public school finance system. The present suit presents an

-assertion by four public school districts that the public school finance system has evolved into an

impermissible state ad valorem tax prohibited by the Texas Constitution, Article VIll, Section

l-e, as foreseen by the Court in Edgewood IV, that the districts must tax at or near their rate

limits to educate their students, and that the districts have been deprived of "meaningful

discretion" in setting their tax rates or using their tax revenues.The Travis County district court

dismissed the plaintiffs' suit on the pleadings and the Third Court of Appeals affirmed. The

Supreme Court reversed the district court and court of appeals and remanded the case to the

Seven justices joined in thedistrict court for further proceedings consistent with its opinion.

opinion, one justice separately concurred, and one justice dissented.

Justice Hecht delivered the Court's opinion. In its decision, the Court addressed virtually

all of the issues currently being discussed related to the State's public school finance system.

Also, the Court reviewed itsNone of the discussion was favorable to the current system.

previous four decisions. emphasized several themes that it has discussed in those opinions. and

The theme from its prior decisions thatelaborated upon issues discussed in the prior opinions.

received the most discussion was the extent to Which unequalized; or partially unequalized, local

."c"i'~~~'.c '0 .enrichment is permitted. Finally, the Court reasserted its interest and authority m participating in

~= '. 'c""c'c ,..0'the deveJop,~,~!eg~blic school finance system that meets the tie!'ds of m~~~m Texas and

~iY~mPli~ with the requiremen~ Qf~"T~x~ Constitution.'--~-~, "ccCc-'I"'r:.:]C",.

Historical ReviewB.

The Court reviewed its previous four decisions and put them in the context of current

The Court reviewedissues relating to the constitutionality of the public school finance system.

of the Texas Constitution, which imposes a mandatoryits prior analysis of Article VII, Section

The Court found that thisduty upon the Legislature and "both empowers and obligates."

First, the level of education providedprovision requires the Legislature to meet three standards.

Second. the means to provide the necessary level of education must bemust be "adequate."

The Court further stated that, "[t]heThird, the overall system must be "efficient.""suitable."

Thus, thefinal authority to determine adherence to the ConstiMion resides with the Judiciary.

Legislature has the sole right to decide how to meet the standards set by the people in article vll,

section 1, and the Judiciary has the final authority to determine whether they have been met."

In reviewing its decision in Edgewood I, the Court noted that the first tier of funding did

The Courtnot meet the costs of the minimal requirements mandated by the Legislature.

elaborated upon its discussion in Edgewood I related to local enrichment and stated

Because constitutional efficiency does not require absolute equality of spending,we expressly acknowledged that "local communities would [not] be precludedfrom supplementing an efficient system established by the legislature", but weadded that "any local enrichment must derive solely from local tax effort." In

other words, the constitutional standard of efficiency requires substantiallyequivalent access to revenue orily up to a point, after which a local community

-2-

can elect higher taxes to "supplement" and "enrich" its own schools. That ooint.of course. althou2h we did not exDresslv sav so in Edf!ewood I. is the achievementof an adeQuate school svstem as r~uired by the Constitution. Once theLegislature has discharged its duty to provide an adequate school system for theState, a local district is free to provide enhanced public education opportunities ifits residents vote to tax themselves at higher levels. The requirement of efficiencydoes not preclude local supplementation of schools. Although we were not calledupo~ in Edgewood I to consider what constitutional adequacy entails, the~terrelationship between the standards of adequacy and efficiency wasfundamental to our reasoning in that case. (underline added).

In reviewing its decision in Edgewood II, the Court stated that the significant remaining

disparities in wealth and revenues continued to make the system constitutionally inefficient in its

The Court also noted that its decision in Edgewood n recognizeduse of the State's resources

that "efficiency qid not preclude local supplementation of school funding.

In reviewing its decision in Edgewood III, the Court discussed that it had found the

county education district (CED) structure to impose a state ad valorem tax in violation of Article

vrn, Section l-e of the Texas Constitution,Quoting from its decision in Edgewood fi, the

Court noted. that "[i]f the State mandates that a tax be levied, sets the rate, and prescribes the

distribution of the proceeds, the tax is a state tax, regardless of the instrumentality which the

[a]n ad valorem tax is a state tax when it is imposed directly byState may choose to use

the State or when the State so completely controls the levy, assessment and disbursement of

revenue, either directly or indirectly, that the authority employed is without meaningful

discretion." The Court further noted that the levy of a tax by the CEDs without an election

violated Article VII, Section 3(e) of the Texas ConStitution

In reviewing its decision in Edgewood IV, the Court stated '[ c ]onstitutional efficiency

under article Vll, section requires only that "districts must have substantially equal access to

funding up to the legislatively defined level that achieves the constitutional mandate of a general

diffusion of knowledge." The Court further stated that "the interrelated constitutional standards

.3

of efficiency and adequacy both limit legislative discretion." Finally, the Court concluded its

review of itS previous decisions as follows:

Although we rejected all of the challenges to Senate Bill 7, we stressed that thesystem was "minimally acceptable only when viewed through the prism ofhistory." In other words, it was better than it had been. But we added: "SurelyTexas can and must do better." . .. Presciently, we observed in Edgewood W:"Our judgment in this case should not be interpreted as a signal that the schoolfinance crisis in Texas has ended."

Current ChaUeneesc.1. State Property Tax.

First, the Court considered what factors the plaintiffs must allege to state a violation of

The Court stated that, in determiningArticle Vill, Section l-e of the Texas Constitution.

whether an impennissible state property tax has been created indirectly, "[t]he detennining factor

is the extent of the State's control over the taxation process.

The Court rejected the State's argument that ~ school districts must be forced to tax at a

specific rate in order for an im~rmissible state property tax to exist. The Court further rejected

the trial court's conclusion that no such violation exists unless ~ districts are forced to tax at

their maximum rate. The Court stated that a ~ district may state a claim for a violation of

Article Vrn, Section l-e if it alleges that it is forced by the State to tax at a particular rate.

Maximum Tax Rate2.

The Court considered separately and rejected each of the State's four reasons why the

plaintiff districts cannot allege that they are forced to tax at their maximum rate.

State Controla.

First, the State argued that it does not directly control taxation by school districts, and

he Court rejected this argument anddistricts are free to set their own rate up to the maximum

reaffumed, as it has stated previously, that the constitutional prohibition on a state property tax is

violated whenever the State's control over the taxing system denies a local school district

4-

"We remain of the view that school districts can be forced by theIfmeaningful discretion."

current system to tax at maximum rates. An allegation that this has occurred states a claim under

article Vffi, section l-e.

b. Accreditation and Adequacy

l:I1~xf:the Court considered the State's argument that districts cannot allege that they must

The Court discussed the potentialtax at maximum mtes just to meet accreditation requirements,

distinction between the State's accreditation requirements and the State's constitutional duty to

Although these two requirements may be theprovide an adequate education to all students.

same, as the Court assumed in Edgewood IV in 1993, they are not necessarily the same

"[P]ut we also insisted that theExplaining its decision in Edgewood IV, the Court stated

"State's provision for a general diffusion of knowledge must reflect changing times, needs, and

...egislature is not the sole arbiter of the constitutionalpublic expectations", and that the

standard." In discussing the potential distinction between the State's accreditation requirements

and the Legislature's constitutional adequacy standard, the Court stated "[i]t may well be that the

requirements are identical; indeed, as in Edgewood IV, we presume they are, giving deference to

But it is possible for them not to be - an accredited education maythe Legislature's choices.

provide more than a general diffusion of knowledge, or vice versa - and because both are

binding, a district may allege that taxation at a maximum rate in order to satisfy either is a state

ad valorem tax.

The Court further noted that there is no factual record to determine the cost of an

accredited education, and the dispute over the cost of meeting all of the State's accreditation

requirements precludes dismissal of the plaintiffs' suit on the pleadings

"Thus, to obtain dismissal of the plaintiffs' claims on the merits based solely on the

pleadings, the State must establish as a matter of law that the plaintiff school districts are not

-5-

forced to tax at maximum rates either to meet accreditation standards or to provide a general

diffilsion of knowledge. The State has done neither."

Optional Homestead Exemptions.c.The Court also rejected the State's argument that no district with an optional local

homeste.a,d C1n allege that it is forced to tax at its maximum rates, because it could lower its rates

The Court stated that "while school districts obviously haveif it eliminated the exemption.

discretion whether to increase homestead exemptions, it is far from obvious that their discretion

By authorizing local-option homestead exemptions, knowing that someis meaningful

constituencies will insist on them, the Legislature may actually have increased the pressure on

school districts to tax at maximum rates."

Actual Taxation at Maximum Rate.d.

Finally, the Court rejected the State's argument that districts must actually be taxing at

The Court stated:their maximum rate in order to allege a violation of Article Vill, Section l-e.

"[A] district taxing a few cents below the maximum rate that can no longer provide an accredited

education or a general diffusion of knowledge even by raising the rate to the maximum need not

do so just to prove the point"

ConclusionD.

In response to the dissent, the Court emphasized the importance of focusing on all of it:

opinions collectively. The Court stated:

We do not agree with the dissent that the importance of stare decisis can beminimized in this area. For fourteen years the Legislature has worked to bring thepublic school finance system into conformity with constitutional requirements asdeclared by this Court. To announce now that we have simply changed our mindson matters that have been crucial to the development of the public educationsystem would not only threaten havoc to the system, but would, far moreimportantly, undermine the rule of law to which the Court is flrmly pledged.

-6-

The Concurrin!! amnionII.

Justice Enoch agreed with the Court that the plaintiffs had met their pleading obligation

to demonstrate that the public school finance system operates as an unconstitutional state ad

However, he noted that the duty to provide for the " general diffusion ofvalorem tax.

In Justice Enoch's view,knowledge" belongs to the Legislature, not public school districts.

districts may allege that they must tax at a rate set by the State to meet accreditation

However, districts may not assert the. existence of an impermissible state adrequirements.

valorem tax to provide a "general diffusion of knowledge" since that is not their duty.

The Dissentinl! OpinionIII.

Justice Smith dissented from the Court's opinion for three reasons. First, he argued that

the Court does not have subject matter jurisdiction over the case and that the plaintiff districts do

not have standing to assert a violation of the Texas Constitution, Article Vill, Section I-e.

Justice Smith states that the districts are not the real parties in interest in the litigation, that the

districts cannot assert claims on behalf of their taxpayers, and that the districts do not have a

" In Justice Smith'sconstitutional right under Article VIII. Section l-e to "meaningful discretion.

view, the districts' lack of standing is confirmed by the Judiciary's inability to grant the requested

relief, that is, to restore the districts' "meaningful discretion.

Second, Justice Smith disagrees with the Court's interpretation of Article VIII, Section

I-e, not only in the current opinion, but also in Edgewood III and Edgewood IV In particular,

he disagrees with the Court's "meaningful discretion" test as it relates to the interpretation of that

"A review of Edgewood III, Edgewood IV, and the prior proceedings inconstitutional provision.

this case leaves me with the firm conviction that the Court's "meaningful discretion" test must be

reconsidered. The test is inflexible and incapable of easy application. More inlportantly, it is

only marginally tailored to the text, purpose, and history of article VIII, section I-e."

-7~

Third, Justice Smith argues that the Court's prior op~ons interpreting Article VIll,

-e lead to the conclusion that "the wealth-equalization provisions in Chapter 41 of theSection

Education Code violate article vm, section l-e." He states that "[t]he poor correlation between

the text, purpose, and history of article VllI, section 1-3 and the implementing test created by'"

this Court,in Edgewood III and Edgewood W reflects that the test should be abandoned or, at a

minimum, substantially modified."

Finally, although the present case does not directly present a challenge under Article VII,

Section 1, Justice Smith voices his disagreement with the Court's broad interpretation of the

Legislature's duty arising from that provision. "This Court's interpretation of article Vll, section

1 will require it, sooner rather than later, to determine the qualitative level and cost of an

"adequate education" for Texas schoolchildren That determination is not only one the Court

was not elected to make, it is also one the Court is ill-equipped to handle."

IV. Issues for Future Consideration

Determination of costs of meeting all State accreditation requirements and of1

providing a constitutionally adequate education, or "general diffusion of knowledge," both for

the State as a whole and for individual districts.

.2. Potential involvement of more school districts in the litigation.

3. Timing of discovery and trial on the merits in relation to the anticipated special

session to examine the State's public school finance and tax systems.

-8-

ROGER S. McCABESHAREHOWEI.

BoARD CERT1FIm>

PERSONAL INJURY TRIAL LAw,

TEXAS BoARD OF LEGAL SPEClAUZA11ON

Roga'McCabe@mebaffyweber.COID

<.- AUD cmfID.500 DAU.AS, ItIn'I ~IDIm»i. TBX.u ~

...,'fmR1D(8 (713) "5-1-PAX (713)"~

2615 CAlDER AVENUEPOSTOmCEBOX 16

BEAUMONT, TEXAS m04TELEPHONE (409) 835-5011

FAX (409) 835-5177(409) 835-5729

June 12, 200:3

Re: Cause No. B-163,853; Pyramid Constructors, lnc. vs. Port Neches-Groves I.S.D.Court of Jefferson County, Texas; In the 60th District Court of Jefferson County,Texas (M&W File No. 7232-1)

Ms. Lolita RamosJefferson County District ClerkP. O. Box 3707Beaumont, Texas 77704

Dear Ms. Ramos:

Enclosed for filing in the above-referenced case, please find the following

.. AGREED MOTION TO DISMISS.

Please acknowledge receipt and date of filing by placing your file mark on the

Also enclosed is Partial Order of Dismissal as to Certain Claims for the Judge'sapproval. Once the Court has entered the Order, please return a signed copy to us in theenvelope provided.

By copy of this letter, all counsel are being provided with a copy of same.

Thank you for your attention to this matter.

S,in,reIY,, /'.

,. . McCabeFor the Finn

RSM/glmEnclosure( s )

, 3 :DBEAUUTIGATlON:576546.1

A PROFESSIONAL CORPORA'fIONA1TORNEYS AT LAW

extra copy of the Motion which is enclosed and return same to me in the envelopeprovided.

MEHAFFY WEBERMs. Lolita RamosJune 12, 2003 Page 2

cc.

VIA FACSIMILEMr. Dale TingleafTingleaf & Associates820 Gessner, Suite 1445Houston, Texas 77024

VIA FACSIMILEMr. R Lyn StevensStevens, Baldo & Freeman, L.L.P.Suite 400, Petroleum Tower5 5 0 F annin StreetP. o. Drawer 4950Beaumon~ Texas 77704VIA FA CSlMlLE

Mr. Terry FitzgeraldMr. Jim JonesThe Fitzgerald Law F~ P .C.10077 Grogan's Mill Road, Suite 540The Woodlands, Texas 77380

VIA FACSIMILEMr. Rick McRoryRamsey & Murray, P.C800 Gessner, Ste. 1100Housto~ Texas 77024

VIA FA CSlMlLEMr. Alan SandersSanders & Sanders, L.L.P.707 W. Front AvenueP.O. Box 519Orange, Texas 77631-0519

BEAUUrlGAnON:S76S46.1

MEHAFFY WEBERMs. Lolita RamosJune 12, 2003 Page 3

bcc

Mr. Richard A. PeeblesLaw Offices of Richard A. Peebles4001 Garth Ro~ Suite 107Baytown, Texas 77521-3115

Dr. Jimmy CreelSuperintendent of Port Neches-Groves I.S.D,620 Avenue CPort Neches, Texas 77651

BEAUIJ11GA nON:S76S46.1

CAUSE NO. 8-163,853

IN THE DISTRICT COURT OFPYRAMffi CONSTRUCTORS, INC §§§§§§§§

JEFFERSON COUNTY, TEXASvs

PORT NECHES-GROVES I.S.D.PBK ARCffiTECTS, INCCOASTAL FLOORING, INCAnd LASCO, INC. 60TH JUDICIAL DISTRICT

AGREED MOTION TO DISMISS, WITH PREJUDICE,PORT NECHES-GROVES I.S.D.'S CLAIMS FOR DAMAGES

AGAINST PYRAMID CONSTRUCTORS. INC. AND PBK ARCHITECTS. INC.

:OMES NOW, Plaintiff, PYRAMffi CONSTRUCTORS, INC., Defendant/Counter-

Claimant, PORT NECHES-GROVES S.D., and Defendant, PBK ARCHITECTS, INC. and

jointly advise the Court these parties have fully settled all the damage claims asserted by Port

Neches-Groves .S.D. as against Pyramid Constructors, Inc. and PBK Architec~ Inc. Port

Neches-Groves, I.S.D. still maintains its claims for damages against the Defendant Coastal

Flooring, Inc

Pyramid Constructors, Inc.'s claims, for retainage money, interest and attorneys' fees,

allegedly withheld by Port Neches-Groves, I.S.D. as set forth in the Pyramid Constructors, Inc.'s

last filed petition in this case, are preserved and have not been settled.

With the damage claims of the Port Neches-Groves. I.S.D. resolved as to Pyramid

Constructors. Inc. and PBK Architect. Inc.. the claims for contribution filed by and between

Pyramid Constructors, Inc. and PBK Architect, Inc. are moot and are hereby non-suited as well

WHEREFORE, Plaintiff, PYRAMll) CONSTRUCTORS. INC. The Defendant/Counter-

Claimantt PORT NECHES-GROVES I.S.Dot and Defendant PBK ARCHITECTSt INC. requests

the Court to enter the proposed Order attached which dismisses the claims set forth above.

W:\WP5J\40170-settled\Pleadings\MOTOOl - Agreed Dismiss and Order.wpd Pa~ No.

Respectfully submitted,

;JBy:~R°'ifr :State Bar No. 13335500MEHAFFY & WEBERPost Office Box 16Beaumont, Texas 77704Telephone: (409) 835-5011Telecopier: (409) 835.5177And

By .-'1..11 J /J h ~ J I

-..J'l~~~1~~~~~-~::~--~~~~~~~.- .State Bar No. 1571900Q..,.6~ Jir.CC~4""-';:RICHARD A. PEEBLES, P .C.4001 Garth Road, Suite 107Baytown, Texas 77521Telephone: (281) 427-7000Telecopier: (281) 427-2685

ATTORNEYS FORPORT NECHES-GROVES I.S.D.

Page No.2

\,..

By:

BeaUfflGfit, Texas 77i64-4g50(409) 835-5200

THE FITZGERALD LAW FIRM, P .C.

,,1"-""':'

B)T~ Fi~JdState B~o. J, -10077 Grogan's Mill Rd, Suite 540The Woodlands, Texas 77380Telephone: (281) 362-9700Telefax: (281) 362-7676

ATTORNEYS FORPBK CONTRACTORS, INC.

W:\WPSl\40J70-settJed\Pleadings\MOTOOl - Agreed Dismiss and Order.wpd Page No.3

CAUSE NO. 8-163,853

PYRAMID CONSTRUCTORS, INC §§§§§§§§

IN THE DISTRICT COURT OF

JEFFERSON COUNTY, TEXASvs

PORT NECHES-GROVES I.S.D.PBK ARCHITECTS, INCCOAST AL FLOORING, INCAnd LASCO, INC. 60TH JUDICIAL DISTRICT

PARTIAL ORDER OF DISMISSAL AS TO CERTAIN CLAIMS

The Court having received the ,. Agreed Motion to Dismiss Port Neches-Groves LS.D.'s Oaims

for Dalnages Against the Pyramid Constructors, mc. and PBK Architects, mc." hereby finds as follow

It is ORDERED, ADJUDGED AND DECREED that all claims for damages by the Defendant!

Counter-Claimant Port Neches-Groves I.S.D. are dismissed, with prejudice, as to Plaintiff Pyramid

Constructors. Inc. and Defendant PBK Architect. Inc Port Neches-Groves, I.S.D. 's damage

claims as against Coastal Flooring, Inc are still maintained and will be pursued by Port Neches-Groves,

.S.D. It is'furlher:

ORDERED. ADJUDGED AND DECREED all claims for contribution filed by and between

Plaintiff Pyramid Constructors, Inc. and PBK Architects, Inc. based upon the damage claims of Port

Neches-Groves I.S.D. are now moot and are dismissed

Plaintiff Pyramid Consb"uctors, Inc,'s original claim for retainage under the construction contract

at issue is preserved as between Plaintiff Pyramid Constructors, Inc. and Port Neches-Groves I.S.D. This

claim has not yet been resolved and is still active; and

PBK Architects, Inc. is a "Settling Defendant" as to the damage claims of Port Neches-Groves

is.D. and is now dismissed as a formal party to this case

rr IS SO ORDERED.

SIGNED this day of June, 2003

~-JlJDGE GARY SANDERSON

W:\WP51\40170-settled\Pleadings\MOTOOl - Agreed Dismiss and Order.wpd Page No.4

YUKI ~J!.LJ:U!;~\.jKUV J!.~, I.~.U.

APPROVED:

"R L 51~,~~i} ~-. yn te 'ensState ar 1'0. 19189020STEV S BALDO & FREEMAN, L.L.PP.O. Box 4950Beaumont, Texas 77704-49SO(409) 835-5200

ATTORNEYS FORPYRAMID CONSTRUCTORS, INC.

By:Rog~ ~abeState Bar No. 13335500MEHAFFY & WEBERP. O. Box 16Beaumont, Texas 77704Telephone: (409) 835-5011Te1ecopier: (409) 835-5177And

A. Peebles J f"""M-':'...c.~ tState BarNo. 15719000 ~~RICHARD A. PEEBLES, P .C.4001 Garth Road, Suite 107Baytown, Texas 77521Telephone: (281) 362-9700Facsimile: (281) 362-7676

ATTORNEYS FORPORT NECHES-GROVES, I,S.D.

~ IBy:

Terry Fittterald ATHE FITZGERMD LA W FIRMState Bar No. 0708902510077 Grogan's Mill Road, Suite 540The Woodlands, Texas 77380Telephone: (281) 362-9700Facsimile: (281) 362-7676

ATTORNEYS FORPBK ARCffiTECTS, INC.

W:\WP51 \40170-settled\Pleadings\MOTOOI Agreed Dismiss and Order. wpd Page No. j

Cause No. 8-163.853

PYRAMill CONSTRUCTORS, INC. §§§§§

IN THE DISTRICT COURT

JEFFERSON COUNTY, TEXAS

PORT NECHES-GROVES I.S.D. 60TH JUDICIAL DISTRICT

SETTLEMENT STATEMENT

SETTLEMENT FUNDS RECEIVED FROMPYRAMID CONSTRUCTORS, INC. : $900,000.00

SETTLEMENT FUNDS RECEIVED FROMPBK ARCHITECTS, INC.: $600.000. 00

TOTAL SETTLEMENT FUNDS: $1,500,000.00Less: 35% Contingency Fee Attorney's FeesTo Mehaffy & Weber and the Law OfficesOf Richard A. Peebles: ($525,000.00)

NET RECOVERY AFTER ATTORNEY'S FEES: $975,000.00

Expenses incurred by Mehaffy & WeberFile No. 7232-0001 $15,944.36

Expenses incurred by Richard A. Peebles: $ 338.24

Total: $16,282.60

LESS TOTAL EXPENSES: ($16.282.60)

NET RECOVERY TO CLIENT: $958,717.40

BEAUUTlGA TK>N :577390.

ACKNOWLEDGMENT

I hereby acknowledge receipt of a copy of this Settlement and acknowledgereceipt of a MehaiIy & Weber Trust Account check in the amount of $958,717.40, madepayable to Port Neches Independent School District as settlement of the above-referencedcause of action as calculated above with Pyramid Constructors, Inc. and PBK Architects,Inc.

u'-

By:J-~,fJ~~ ~

BEAUIn1GA nON :577390.1

New state funding makesdifference for now but isn'tseen as long-term solution

By DIANA REINHARTTHE ENTERPRISE

This year's legislative session did-n't entirely revamp public educationfunding in Texas, but it did put moremoney into schools - enough tostave off some financial difficulties inSoutheast Texas, officials say.

Although the new funding -about $150 more a year per student- wasn't all local educators hopedfor, it makes a'8ignificant differencein next school year's budget, oftenbecause it offsets cuts in other typesof state funding, they say.

"It helped us out tremendously,"said David Edgar, a Vidor school dis-trict assistant superintendent. "Ithelped us out of what could havebeen a rather significant situation."

The additional funds, which totalabout $700,000 for Vidor, mean thedistrict won't have to reduce expen-ditures or its local homesteadexemption, Edgar said.

In other districts, the funds arehelping to reduce deficits, pay foremployee raises and prevent taxincreases, sch<;>ol officials say;

FUNDING. page 4A

E COVER

Continued from page 1A

"You bet it's a big deal,"said Jimmy Creel, Port Nech-es-Groves school district'ssuperintendent. "We're justglad that we got some newmoney because that's notbeen the case every yea,r.We're always glad to see newmoney because costs aregoing up."

Still, educators caution thatthe new money cannot sus-tain schools in the long run.

The current school fund-ing system, dubbed "RobinHood" by its critics, takesproperty tax revenue fromwealthy districts and gives itto poorer ones in an effort togive all students an equaleducation. Both rich andpoor districts argue that itdoesn't provide enoughmoney for public education.

The funding increase does-n't change the system exceptthat it gives districts moremoney per student. It will costthe state $1.2 billion over thenext budget biennium.

"This wasn't intended tosolve the Robin Hood prob-lem," said state Rep. KentGrusendorf, R-Arlington."Our intent was to providetemporary relief and estab-lish a deadline to put a per-manent solution in place."

The bill that established

the new funding put a Sep-tember 2004 deadline onfinding a replacement forRobin Hood Lawmakers areexpected to take up the issuein a special session later thisyear or early next year.

Meanwhile, school dis-tricts are building their bud-gets for next school year.

The Beaumont school dis-trict expects state revenue toincrease about $2 million to$27.4 million of a $125 mil-lion budget.

The, additional revenuecovers the majority of $3.3million in raises for allemployees and hclps elimi-nate the need for a taxincrease; said Jolene Ortego,the district's spokeswoman.

The Port Neches-Grovesdistrict expects almost$600,000 from the new fund-ing, business manager CherylHernandez said. The Legisla-ture, however, also increasedthe amount that districtsmust pay into the state'steacher retirement system, sothe district expects to netabout $480,000, she said.

The district had a $2 mil-lion deficit last year, and the$480,000 will help close that,she said.

"It is some help, definite-ly,n she said "It's kind of like atemporary fix, but were hop-ing that they redo the systemso it's adequate for all schooldistricts."

The Little Gypress-Mau-riceville district will receiveabout $500,000 from the newper-pupil funding, assistantsuperintendent Grey Perrysaid. The money will allowthe district to keep its 1ocalhomestead exemption, he

saidIn the past, the state has

reimbursed the district forabout half of the revenue itlost because of the localexemption, he said. Last yearthe reimbursement was$776,000.

Because the state will notoffer the reimbursement thisyear, the district needed thenew funding to keep theexemption affordable, Perrysaid.

The district is still comingout behind from the state,however, because the reim-bursement was more thanthe new funding, he said.

In the Vidor district, whichalso has a local homesteadexemption, the projected$700,000 in new funds almostequals the reimbursementamount of previous years,Edgar said.

"I was relieved that theydid come in and put the $1.2billion toward additionalstate funding this year," hesaid.

The Lumberton schooldistrict expects about$400,000 from the new funds,which will help offset theincreasing costs of insurance,utilities, fuel ~d other items,said George Talbert, directorof operations.

"It's greatly appreciated,but it's not near enough, andI suspect that that's going tobecthe case in most districts,"he said. "We're looking for-ward to seeing some majorchanges in the funding to tryto give some relief to proper-ty owners." -Reach this reporter at:(409) 833-3311, ext. 418d rei n ha rt@beaumontenterprise.com

Increase doesn'treform system;that comes later

~~ 1<fJ)(.. & e..P Y-- 9, .2D 6 ,...

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JI- ~ ~~~~ fJ- ~m--~~ - ~ ~~~~!:::.6",4~4 J 'O~~ l 'Jl"'.".~~nt ~~~ ~-'- OJ.£4_. I II.~ -~~-~- t1 &4~~,,: "-

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-h. II J.-t,..:J- ~~~qyc ~~"-- 4--

Jimmy CreelSuperintendent

To:

Cheryl HernandezBusiness Manager

From;

Tax Collections Monthly ReportMay 2003

Subject:

2002 taxes collected for the period September 1, 2002 through May 31, 2003 amounted to$38tI48,156.28 which is 97.57% of the $39,098,330.70.

.

Delinquent taxes collected for the period September 1, 2002 through May 31, 2003amounted to $166,524.11.

.

Revenue from the Successor-In-Interest to a former County Education District collected forthe period September 1,2002 through May 31,2003 amounted to $3,759.08.

.

I, Cheryl Hernandez, do solemnly affinn, that to the best of my knowledge this report, given incompliance with Tax Code 31.10( a), represents the true figures as recorded upon the records of the PortNeches-Groves Independent School District. So help me God.

(~ c. .u~~ JNotary Public in and for the State

of Texas.

~24

PORT NECHES-GROVESINDEPENDENT SCHOOL DISTRICT

620 Avenue CPort Neches, Texas 77651

(409) 722-..244 Ext.22 FAX (409) 724-7864-e-mail jcrcel(~esc5.net

~(Q)~~

Office of SuperintendentDr. Jimmy Creel

June 16, 2003

To Whom It May Concern:

The Port Neches-Groves Independent School District would be happy to evaluate andconsider an agreement under the provisions ofHB 1200 with a potential new taxpayer ifthe company is able to meet the qualifications and appropriately demonstrate acommitment for such an agreement and if such an agreement is perceived to be mutuallybeneficial.

Our previous experience in the negotiation of a HB 1200 agreement leads us to believethat there are opportunities for the district to benefit from such an agreement. Therefore,any legitimate application accompanied by the application fee as stipulated in the lawwill be carefully evaluated and consideration will be given to the proposed agreement.While I am authorized to make commitments regarding the district's consideration ofsuch an agreement, the Board of Trustees must give final approval of any agreementmade on behalf of the district.

Pagelofl

Dr. Jimmy Creel- --

From: Lani Randall prandall@escS.net}

Sent: Tuesday, June 17, 2003 3:10 PM

To: Jimmy CreelCc: Jay Martin

Subject: Clara Graham's Growth Plan

Dear Dr. Creel,

As you are aware, Clara Graham was currently on a professional growth plan. Due to the fact that Ms. Grahamretired from the district this month, the growth plan is no longer necessary. Please let me know if you need furtherclarification regarding this matter. Thanks!

Lani Randall

6/17/2003

PageloflMessage

Dr. Jimmy Creel

From: Jay Martin Ukmartin@esc5.net]Sent: Monday, June 16, 2003 4:05 PM

To: Dr. Jimmy Creel

Cc: Dr. Lani Randall

Subject: FW: Early Childhood Campus

Dr. Creel,Dr. Randall and I have met and discussed ways to best cover the ECH/Pre-K campus for the following schoolyear. We explored several possi~lities and expect there will be times when more than one person will have needto cover the campus because of someone being involved in another assignment off-campus. Since the ECHportion of the campus is directly involved with special education students, Dr. Randall and I came to theconclusion that Suzanne Mondey would be the best fit to oversee the campus and program. Ms. Mondeypresently works a 223 day contract and in reviewing the additional requirements of taking on the ECH/Pre-Kcampus, I do not feel there would not be a need to add additional days to her contract. We do know that assumingthe campus will require additional time. For instance, it is necessary for someone to remain on the campus untilall the ECH/Pre-K buses have delivered students home in the afternoon. If a chikj cannot be delivered becausesomeone is not present to take the chikj at the designated bus stop, the driver retums the chikj to the ECHcampus and the administrator keeps the child until a parent is notified and picks up the child. This happensfrequently and we must have a responsible person to receive the child from the bus driver and supervise the childwhile making arrangements for them to be picked up. Because of this added time, Dr. Randall and I figured anaverage of one hour a day of extra time will be spent waiting for the buses to clear. Because of the extra timerequired in the afternoons and because of the additional duties that Ms. Mondey will assume in supervising thecampus, we feel that a stipend of $5,000 will be fair compensation.Based upon my investigation into this position, I concur with Dr. Randall's recommendation that we assign Ms.Mondey the ECH-Pre-K campus with a stipend of $5,000 for the 03 - 04 school year.Jay MartinAssistant Superintendent forAdministrative ServicesPort Neches-Groves ISD

Original Message From: Lani Randall (mailto:lrandall@e;c5.net]

Sent: Monday, June 16, 2003 1:23 PMTo: Jay MartinCc: Jimmy Creel; Suzanne MondeySubject: Early Chiklhood Campus

Dear Mr. Martin,

I am recommending that Ms. Suzanne Mondey assume the role of the supervisor for the Early Childhood campusfor the 2003-2004 school year. Earlier today. I spoke to Ms. Mondey regarding the extra duty of supervising theEarly Childhood campus during the school year. Ms. Mondey stated that she is very willing to assume thisadditional responsibility. She also agreed to extend her workday in order to monitor the after school bus deliveryof students. Ms. Mondey was notified that she would receive an annual stipend of $5000. as compensation forher extended workday.

Please contact me if you have any questions regarding this recommendation.

Lani Randall

6/16/2003

PageloflMessage

Dr. Jimmy Creel

From: Lani Randall prandall@escS.net)

Sent: Monday, June 16,20031:23 PM

To: Jay Martin

Cc: Jimmy Creel; Suzanne Mondey

Subject: Early Childhood Campus

Dear Mr. Martin,

I am recommending that Ms. Suzanne Mondey assume the role of the supervisor for the Earty Childhood campusfor the 2003-2004 school year. Earlier today. I spoke to Ms. Mondey regarding the extra duty of supervising theEarly Childhood campus during the school year. Ms. Mondey stated that she is very willing to assume thisadditional responsibility. She also agreed to extend her workday in order to monitor the after school bus deliveryof students. Ms. Mondey was notified that she would receive an annual stipend of $5000. as compensation forher extended workday.

Please contact me if you have any questions regarding this recommendation.

Lani Randall

6/16/2003

Port Neches-Groves Independent School District

JOB TITLE: Director of Special Education andECH/Pre-K CampusAsst. Superintendent forInstructional Services

W AGE/HOUR STA ruS: Exempt

REPORTS TO: PAY GRADE: Adrn/Prof - 4

DEPT./SCBOOL: DATE REVISED: June 16,2003West Grove Curriculum Center

PRIMARY PURPOSE:Direct the district's special education and early childhood/pre-K program to ensureprovision of needed services for special needs students. Work to provideindividualized education plans to meet the needs of all students and ensure compliancewith all state, federal, and local requirements. Provide leadership and direction whilecoordinating the instructional programs of the assigned areas.

QUALIFICA nONS:

Ed Dca tion/Certifica tio n:Master's degreeTexas Mid-Management or other appropriate Texas certificateValid Texas teaching certificate with special education endorsement

Special Knowledge/Skills:Understanding of the individual needs of special needs studentsAbility to communicate with all levels of special needs students and their parentsAbility to interpret policy, procedures, and dataAbility to manage budget and personnelAbility to coordinate district functionStrong organizational, communication, and interpersonal skills

Experience:Five years teaching experience in special education

MAJOR RESPONSIBILmES AND DUTIES:Special Education Instructional Program

. Direct and manage special education programs and services to meet student's needs.Ensure that student progress is evaluated on a systematic basis, and that the findingsare used to make special education programs more effective.Ensure the use of technology in the teaching-learning process.Encourage and support the development of innovative instructional programs,helping teachers to pilot such efforts when appropriate.Plan the necessary time, resources, and materials to support subordinates inaccomplishing educational goals.

Director of Special Education and Early Childhood Center

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Manage the special education referral process; arrange for or conduct studentassessments; make recommendations regarding placement and programmanagement for individual students.Supervise and monitor the admission, review, and dismissal (ARD) process district-wide.Participate in committee meetings to ensure the appropriate placement anddevelopment of individual education plans for students according to districtprocedures.Supervise transition services for special education students entering and exitingpublic school programs.Provide leadership in the formulation and implementation of contracts for specialeducation students receiving services outside of the district.Obtain and use evaluative findings (including student achievement data) to gaugespecial education program effectiveness.Serve as resource person in the design and equipping of facilities for students withdisabilities.

Ensure that curriculum renewal is continuous and responsive to student needs..

ECH/Pre-K Campus

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Directs instruction and curriculum services to meet students' needs.Plans, implements and evaluates programs as assigned with teachers and staffincluding learning objectives, instructional strategies and assessment techniques.Prepare and submit required reports.Develop proposals for continued funding.Plan and monitor the budget, making budget amendments when needed.Assist teachers and parents on plans for inclusion; plan activities and lessonsappropriate for inclusion with all students.Arrange field trips; request transportation for field trips.Organize classes; make student assignments to classes.Conduct faculty meetings to disseminate information, discuss instructional needs,plan together with teachers and instructional aides.Arrange for substitutes when teachers or instructional aides are absent from duty.Evaluate, appraise and review the performance of assigned staff.Assist teachers in the development of a campus-wide discipline managementprogram appropriate for the age levels.Conduct Admission, Review and Dismissal {ARD} committee meetings.Assist the speech pathologists in screening new referrals for the Preschool programfor children with disabilities.

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Director of Special Education and Early Childhood Center

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Organize, schedule and announce pre-registration for the pre-kindergarten progranl.Assist teachers in the selection and use of teaching materials.Monitor buses remaining at school each day until all students have been deliveredhome; receive any child returned to school because no adult was home when thechild arrived; try to locate parent or someone on the emergency card to call for thechild.Plan and manage the budget for the Early Childhood CenterConduct parent conferencesTest ESL students: pre-test and post-test; conduct initial placement and end of yearplacement meetings with the ESL committee.Work with the CanlpUS Improvement CouncilPlan and arrange nine parent training or parenting sessions held throughout theschool year.Write monthly reports listing activities, needs, plans, etc. of the previous month.Attend School-wide Title I meetings at Region V to remain current with themandates of that program.Work with Assistant Superintendent for Instruction on any Title I projects, ESLprojects or needs.Respond to requests for school records from other agencies; schools, state disabilityoffice, etc.Disseminate information about the Early Childhood Center to patrons of PNGISDthrough day care centers, apartment complexes, letters home to parents of K-5students.Provide each K-3 campus with a list of students who are eligible to attend theirkindergarten program in the fall of the following school year; talk withprincipals/counselors to follow-up on any special needs children.Assist in the planning of activities for staff development.Other duties as may be assigned.

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SUPERVISORY RESPONSmILITIES:

Supervise and evaluate the perfonnance of teachers and support staff as assigned.

Student Management

. Demonstrate support for the district's student management policies and expectedstudent behavior related to special education and ECH/Pre-K Campus program.Establish and maintain open lines of communication by conducting conferenceswith parents, students, and teachers concerning vital issues.

Director of Special Education and Early Childhood Center3

Policy, Reports, and Law

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Recommend sound policies to improve program.Implement the policies established by federal and state law, Commissioner's rule, andlocal board policy in area of special education.Compile, maintain, and file all reports, records, and other documents required.

Budget and Inventory

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Administer the special education department and ECH/Pre-K Campus budget andensure that programs are cost effective and funds are managed prudently.Compile budgets and cost estimates based on documented program needs.Maintain a current inventory or supplies and equipment and recommend thereplacement disposal of equipment when necessary.Approve and forward purchase orders for special education department ECH/Pre-KCampus to accounting department.

Personnel Management

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Prepare, review, and revise job descriptions in special education department.Develop training options and/or improvement plans to ensure exemplary operationsin the special education area.Evaluate job performance of employees to ensure effectiveness.Participate in the recruitment, selection, and training of personnel and make soundrecommendations relative to personnel placement, assignment, retention, discipline,and dismissal.

Communication and Community Relations

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Serve as district liaison to community agencies providing services to students andnotify parents and students of available services.Participate in professional organizations and serve on community boards.Articulate the district's mission and goals in the area of special education to thecommunity and solicit its support in realizing the mission.Demonstrate awareness of district-cornrnunity needs and initiate activities to meetthose needs.Demonstrate awareness of district-community needs and initiate activities to meetthose needs.Use appropriate and effective techniques to encourage community and parentinvolvement.

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Director of Special Education and Early Childhood Center

SUPERVISORY RESPONSmILITIES:

Supervise and evaluate the perfonnance of the diagnosticians, adaptive physicaleducation teacher, visual impaired teacher, speech therapist, aides, special educationsecretary, nurse! secretary for ECH/Pre- K.

Working Conditions:

Mental Demands/Physical DemandslEnvironmental Factors:Maintain emotional control under stress. Frequent district-wide travel and occasionalstatewide travel; occasional prolonged and irregular hours

The foregoing statements describe the general purpose and responsibilities assigned to this job andare not an exhaustive list of all responsibilities, duties, and skills that may be required.

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Coming Events

Called Board Meeting ............................................................................................ July 8 @ 6:30 p.m. Public Hearing on Federal Funds – Dr. Lani Randall Regular Board Meeting............................................................................................... July 8 @ 7 p.m. Budget Workshop ....................................................................................................... July 9 @ 6 p.m. Sandwiches will be provided. TASB Summer Governance & Post-Legislative Seminars (Fort Worth)..................July 18-19, 2003 TASB/TASA Convention in Dallas................................................................................... Sept. 19-22