HOW DO JUDGES DECIDE SCHOOL FINANCE CASES?

• Author: Hutt, Ethan

ABSTRACT

There is an old riddle that asks, what do constitutional school funding lawsuits and birds have in common?

The answer: every state has its own. Yet while almost every state has experienced hotly-contested school funding litigation, the results of these suits have been nearly impossible to predict. Scholars and advocates have struggled for decades to explain why some state courts rule for plaintiff school children--often resulting in billions of dollars in additional school spending--while others do not.

If there is rough agreement on anything, it is that "the law" is not the answer: variation in the strength of state constitutional education clauses is uncorrelated with the odds of plaintiff success. Just what factors do explain different outcomes, though, is anybody's guess. One researcher captured the academy's state of frustration aptly when she suggested that whether a state's school funding system will be invalidated "depends almost solely on the whimsy of the state supreme court justices themselves. (1)

In this Article, we analyze an original data set of 313 state-level school funding decisions using multiple regression models. Our findings confirm that the relative strength of a state's constitutional text regarding education has no bearing on school funding lawsuit outcomes.

But we also reject the judicial whimsy hypothesis. Several variables--including the health of the national economy (as measured by GDP growth), Republican control over the state legislature, and an appointment-based mechanism of judicial selection--are significantly and positively correlated with the odds of a school funding system being declared unconstitutional. After presenting these findings, the Article discusses the important implications for school finance advocates and for constitutional and legal theory more broadly.

INTRODUCTION I. Our Existing Knowledge Base A. Brief Primer on the Study of Judicial Decision-Making B. Prior Studies of School Funding Lawsuit Determinants II. Data A. The Sample B. Variables III. Method IV. RESULTS V. DISCUSSION A. Major Findings B. Implications for the School Finance Community C. Implications for Legal Theory 1. The Rights Essentialism--Remedial Equilibration Debate 2. Methods of Constitutional Interpretation CONCLUSION APPENDIX INTRODUCTION

Suppose parents of school-aged children file separate lawsuits in two different states, Oregon and South Carolina. The suits contain the same basic allegations. Average per-pupil spending is below the national average. Funding is distributed in a way that affords children in poorer school districts inferior access to critical resources like quality teachers. As a result, these children enjoy lower levels of educational attainment. Each lawsuit therefore seeks a declaration that the school funding system violates the state's constitution.

Oregon's constitution declares that "the legislature shall appropriate a sum of money sufficient to ensure that the state's system of public education meets quality goals established by law." Oregon concedes that its legislature underfunds the state's public education system by nearly $1 billion each year.

By contrast, South Carolina's constitution provides merely that "the legislature shall provide for the maintenance and support of a system of free public schools open to all children in the state. "Although South Carolina's schools are underfunded at levels similar to Oregon's, it is undisputed that South Carolina's schools are free and open to all children.

Assume now, as actually happened, that the plaintiff parents prevail in one of these school funding lawsuits but not the other. What do you think best explains the divergent outcomes?

We suspect most people would offer the following (perhaps obvious) answer: the law! More precisely, one might respond that the outcome of each lawsuit was determined by the relevant state constitutional provision as applied to the facts in each case. And because the facts are largely the same, the only difference that could explain the opposing outcomes is the constitutional text. So whereas Oregon's education clause clearly entitles the plaintiffs to relief, South Carolina's education clause does not.

This is a neat and intellectually coherent answer to give. But it is also wrong. The plaintiffs in Oregon lost, (2) despite the state conceding that it had failed to provide a "sum of money sufficient to ensure that the state's system of public education meets quality goals established by law." (3) The plaintiff children in South Carolina won, (4) even though the state argued with some force that the duty to "provide for the maintenance and support of a system of free public schools" gives rise to no clear qualitative standard for how much funding is necessary. (5)

Counterintuitive outcomes like these are common in school funding lawsuits, and the academy has struggled for years to explain them. (6) The only conclusion on which there is some consensus is that the most intuitive explanation is incorrect: when it comes to deciding the fate of school funding lawsuits, the bare meaning of the law has little do with it. (7)

But if not the law, then what? Surely something explains why judges rule for some plaintiffs who demand billions of dollars in additional public education expenditures, (8) but not for others. (9) The scholarship to date, however, has failed to identify a convincing explanation. (10)

In this Article, we draw on an original data set to present evidence of variables that help to explain the outcomes of school finance lawsuits. First, to borrow from the leading explanation of Bill Clinton's successful presidential bid in 1992: "It's the economy, stupid." (11) Our analysis thus finds that for each 1 percent increase in national GDP growth as measured from the year preceding a court's decision, a judge is 6 percent more likely to rule for school finance plaintiffs. (12) When economic conditions are strong and state coffers are flush with cash, in other words, judges are more likely to side with plaintiffs and issue orders calling for the legislature to increase school spending. When the economy is sputtering and state governments face steep deficits, judges are far less likely to impose new spending mandates.

Indeed, attention to prevailing economic conditions helps to provide the simplest explanation for the seemingly irreconcilable Oregon and South Carolina decisions. The Oregon Supreme Court heard oral argument in Pendleton School District 16R v. State on October 8, 2008 (13)--just three weeks after Lehman Brothers declared bankruptcy and nine days after the stock market crashed. (14) Shortly after the argument, the November 2008 jobs report revealed a loss of 533,000 jobs--the single largest monthly job loss total in more than thirty years. (15) Then, in December 2008, while the case was still pending, the National Bureau of Economic Research officially declared that the U.S. economy was in a recession. (16) Oregon's Supreme Court Justices could not have been blind to this dire economic downturn--a downturn that inevitably affected the state's fiscal health (17) and thus its ability to actually satisfy any adverse judgment--when they elected not to issue a liability order in the Pendleton case. By contrast, the South Carolina Supreme Court's seminal Abbeville decision was issued in 1999. (18) The economy was humming along quite nicely, growing at a 6.3 percent clip from the previous year--a far cry from the 2.1 percent decrease in national GDP that took place in the year before Oregon's Pendleton ruling. (19)

The second significant variable we find is control over the state legislature. When Republicans are in control of the state legislature, judges are more likely to rule in favor of school finance plaintiffs than when the legislature is controlled by Democrats. (20) This result may be surprising at first blush, because one might expect judges to be more willing to impose additional school spending mandates on legislatures that are more likely to comply with them. And Democrats are often thought to be more amenable to raising school spending (and the taxes that go along with it). (21)

The data would seem to tell a different story, one of calculated judicial intervention. On this account judges may be more willing to declare school funding systems unconstitutional when Republicans are in control because they perceive a heightened need to prod lawmakers into action. (22) Insofar as Republican control reduces the likelihood of a legislature-driven increase in school spending, in other words, courts feel a greater need to grab the steering wheel themselves. By contrast, when Democrats are in control, courts may prefer not to intervene (a move that carries potentially great costs for their own institutional legitimacy) (23) because there is a greater chance the legislature will choose to ramp up financial support for public education on its own. (24) Yet again, Oregon and South Carolina are consistent with this story. At the time of the relevant decisions, Oregon's legislature was controlled by Democrats, while South Carolina's was not. (25)

This paper proceeds in five parts. Part I describes the academy's existing limited knowledge regarding the determinants of school finance litigation outcomes. Although a handful of law review and social science articles have performed statistical analyses to identify explanatory variables in school funding cases, the results of those studies are inconclusive at best. (26) This paper aims to improve on this general state of fog.

One major reason for our lack of understanding thus far is the unusually limited data set that the leading scholarly accounts have relied upon: the single most recent school finance decision from forty state courts of last resort. (27) In Part II, we explain how we are able to create a far larger data set encompassing more than three hundred state court decisions. Some of this is a...