Hawkins v. Johanns

In 2000, a ruling would be handed down in a federal lawsuit concerning the Class I school district structure created in 1997 and a revenue structure created in 1996.  On July 21, 1998 the suit was filed in the U.S. District Court of Nebraska by six Class I district patrons against the State of Nebraska.¹  The federal lawsuit was filed by Irwin Hawkins, Teresa and Zane Wondercheck, Jerry Nicholls, Thomas Kappas, and Paul Simmons against Mike Johanns, Governor, Don Stenberg, Attorney General, and Doug Christensen, Commissioner of Education.²

The plaintiffs resided in Class I (elementary only) school districts and sought injunctive and declaratory relief against the defendant state officials based upon the claim that state law concerning reorganization of Class I districts was unconstitutional and denied plaintiffs' equal protection rights.  The plaintiffs challenged a statutory scheme, created under LB 1114 (1996) and LB 806 (1997), in which voters in other classes of districts educating K-12 students could have voting power over their Class I districts.  The plaintiffs alleged their school districts had become dependant upon high school districts for budgets and property tax levies.³  Plaintiffs raised these specific issues:

1. The relative inability to set their own school budgets and the relative inability to exceed the general fund budget authority once it is established;
   
   
2. the relative inability to set or exceed tax levies;
   
   
3. the relative inability to authorize and spend special building fund monies; and
   
   
4. the relative inability to merge, dissolve or reorganize.⁴

The plaintiffs argued that Class I districts deserve equal protection under the 14th Amendment to the U.S. Constitution, the clause that prohibits states from restricting fundamental constitutional rights.⁵

The state defended the laws created in 1996 and 1997 by asserting a legitimate governmental purpose behind the challenged statutes, including promotion of tax equity, educational effectiveness, and cost efficiency.  The state argued that the legislation met the needs of the state while at the same time preserving the authority at the local level to maintain various classes of school districts, including Class I (elementary only) districts.

Naturally, the lawsuit created a fair measure of anxiety among various lawmakers, the executive branch, and those schools that sought to uphold the existing school finance system.  School officials from some of the state's largest schools were sufficiently concerned that they sought to intervene on behalf of the state.  Members of the Greater Nebraska Schools Association (GNSA) filed a friend-of-the-court (emicus) brief on behalf of the defendants.  GNSA is a professional and lobbying organization comprised of school board members and school administrators from many of the larger K-12 school districts in Nebraska.  "Our decision was based upon concern about any potential impact on the ability of the state to distribute state aid to schools," said Ken Anderson, Superintendent at Hastings Public Schools.⁶

At stake, of course, were the products of at least two legislative sessions with particular focus on the levy limits under LB 1114 (1996) and the comprehensive changes to the school finance formula under LB 806 (1997).  If the state lost the case, the Legislature would likely have to start from scratch on a school finance formula, a local property tax system as it applies to school districts, and a school reorganization system.  The anxiety among state officials and other interested parties was particularly acute during the 2000 Session when it was announced that a ruling would be forthcoming prior to the end of the session.  Some wondered if the Legislature would be called into special session to address any deficiencies the court might find in existing state law.

The decision in Hawkins was prepared and delivered by Chief Judge Richard Kopf of the U.S. District Court in Nebraska.  The decision was handed down on March 31, 2000.  This was a recess day for the Legislature, which had only seven business days remaining in its regular session.  And the news was positive for the state.  Judge Kopf held against the plaintiff Class I residents and in favor of the state.⁷

The decision was remarkable really on two different levels.  The first, of course, was that it upheld the work of two separate legislative sessions.  It vindicated those who supported the levy limitations and the school finance modifications in 1996 and 1997.  "Personally, it's a great relief," said Senator Ardyce Bohlke, "It removed any cloud of doubt hanging over LB 806 and how 806 treated Class I schools."⁸ The second remarkable note about the decision had more to do with the extraordinary and painstaking effort of the court to characterize the existing law relevant to school finance and school organization.  It was obvious that Judge Kopf and his staff endeavored to understand all facets of Nebraska's public education structure in order to decide the merits of the allegations.  The background contained in the decision provides a marvelous dissertation on the affiliation system, the rights of voters in different classes of districts, the general fund budget authority among schools, the process to exceed spending limits, the tax levy system, and the procedures for merger, dissolution, and reorganization of school districts.

The findings and conclusions contained within the decision not only vindicated the actions of the Legislature but praised them as well.  His decision was based upon extensive research, including legislative histories of the enacted legislation at issue.  Judge Kopf appeared to empathize with lawmakers and recognized the difficult situations faced by the Legislature in 1996 and 1997.  He wrote in part:

As a result, the legislature faced a difficult dilemma.  It made sense to view the education of children as a continuing enterprise from kindergarten through high school, but it was also advisable to keep the various types of districts separate.  Furthermore, it was necessary to limit the amount of spending on the education of children from kindergarten through high school, and to impose a single funding limit on all schools, whether a school performed all or only part of the total educational task.⁹

In response to the dilemma, he wrote, the Nebraska Legislature "decided to compromise and then experiment."¹⁰  He called the chosen solution an "innovative device" because it retained a modified Class I system that was "partially controlled by a geographically distinct school district that was obligated to provide a high school education to the children graduating from the Class I district."¹¹  He wrote that it "made sense to put much of the decision making power about funding in the geographically distinct district providing the high school education since it was that district that was responsible for the 'finished product.'"¹² The finished product, of course, meant a student with a high school diploma in hand.

As to the specific claims of the plaintiffs, all were dismissed in the judge's ruling.  "The plaintiffs' complaint boils down to a condemnation of the dependence of their Class I school districts on other political bodies for budgets, levies, special funds, and mergers, dissolutions or reorganizations," he wrote.¹³  He concluded:

There is no evidence that a single Class I district school has received funds that are disproportionally less than other similar schools in other districts.

In the same vein, there is no evidence that any Class I district or voter has been denied the ability to merge, dissolve or reorganize.

There is no showing that the legislative scheme has denied, or will deny in the future, Class I voters tax equity, educational effectiveness, or cost efficiency.

Finally, there is no showing that Class I districts or voters are likely to be the subject of discriminatory treatment of any kind by Class II-VI boards or voters.¹⁴

The plaintiffs, he wrote, had offered no proof beyond the mere difference in treatment of various classes of school districts by the state laws in question.

In summary, Judge Kopf wrote, the state had a legitimate purpose in the passage of the challenged legislation:  "By using an ingenious strategy, Nebraska hoped to promote tax equity, educational effectiveness, and cost efficiency while still maintaining the separate identities of various political subdivisions."¹⁵  He wrote that the Legislature's "innovation in the reorganization of Class I school districts" was rationally related to a legitimate governmental purpose and, therefore, not in violation of the equal protection clause of the U.S. Constitution.¹⁶

¹ Hawkins v. Johanns, 88 F.Supp.2d 10 27 (U.S. Dist. Ct. NE 2000).
² At the time of filing, Irwin Hawkins resided in a Class I district in Custer County, Teresa and Zane Wondercheck in Boone County, Jerry Nicholls in Lancaster County, Thomas Kappas in Cass County, and Paul Simmons in Sheridan County.
³ Hawkins v. Johanns, 1027.
⁴ Id., 1029.
⁵ U.S. Const. art. XIV, § 1.
⁶ Leslie Reed, "Large Districts Defend School-Aid Law in Federal Suit," Omaha World-Herald, 15 January 2000, 26.
⁷ Hawkins v. Johanns, 1047.
⁸ Leslie Reed, "Judge Rejects School Aid Suit," Omaha World-Herald, 1 April 2000, 1.
⁹ Hawkins v. Johanns, 1045.
¹⁰ Id.
¹¹ Id.
¹² Id.
¹³ Id., 1046.
¹⁴ Id.
¹⁵ Id.
¹⁶ Id., 1047.