Three-Page Narrative

School Finance Litigation: The Promises and Limitations of the Third Wave Author(s): Christopher Roellke, Preston Green and Erica H. Zielewski Source: Peabody Journal of Education, Vol. 79, No. 3, K-12 Education Finance: New Directions for Future Research (2004), pp. 104-133 Published by: Taylor & Francis, Ltd. Stable URL: http://www.jstor.org/stable/1493297 Accessed: 05-08-2016 21:26 UTC

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PEABODY JOURNAL OF EDUCATION, 79(2), 104-133 Copyright ? 2004, Lawrence Erlbaum Associates, Inc.

School Finance Litigation: The Promises and Limitations of the Third Wave

Christopher Roellke Department of Education Vassar College

Preston Green

Department of Education Policy Studies The Pennsylvania State University

Erica H. Zielewski

The Urban Institute

Washington, DC

Equity and adequacy in school finance has been a concern of scholars and re- formers since the early 1900s and became a subject of court litigation in the late 1960s and early 1970s. Despite intensified school finance litigation and legislation over the past several decades, school systems in the United States continue their struggle to operate equitably and adequately. This persistent inequity, both in terms of educational inputs and outcomes, has generated a long and complex series of lawsuits, which we attempt to summarize in this article.

Requests for reprints should be sent to Christopher Roelike, Vassar College, 124 Raymond Avenue, Poughkeepsie, NY 12604-0407. E-mail: [email protected]

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School Finance Litigation

The 4 primary goals of this review of the past 3 decades of school finance litigation in the United States are

1. To illustrate the evolution of plaintiff strategies across the "3 waves" of school finance litigation.

2. To outline possible reasons for the failure of lst- and 2nd-wave litigation.

3. To highlight the promising aspects of 3rd-wave school finance litigation and also discuss some of its limitations.

4. To examine new trends in adequacy litigation.

The article concludes with a discussion of anticipated developments in le- gal debates regarding the funding of schooling systems, particularly those lo- cated in poor, urban areas.

[S]chool finance reform is like a Russian novel; it's long, tedious, and ev- erybody dies at the end. (Yudof, 1991, p. 499)

Equity and adequacy in school finance has been a concern of scholars and reformers since the early 1900s and became a subject of court litigation in the late 1960s and early 1970s. Despite intensified school finance litiga- tion and legislation over the past several decades, school systems in the United States continue their struggle to operate equitably and adequately. The evidence is clear that these goals of equity and adequacy have been particularly elusive for schools attended primarily by low-income and mi- nority children (Hochschild & Scovronick, 2003; Roelike & Rice, 2002). This persistent inequity, both in terms of educational inputs and outcomes, has generated a long and complex series of lawsuits, which we attempt to sum- marize in this article. The four primary goals of this review of the past three decades of school finance litigation are

1. To illustrate the evolution of plaintiff strategies across the "three waves" of school finance litigation.

2. To outline possible reasons for the failure of first- and second-wave litigation.

3. To highlight the promising aspects of third-wave school finance liti- gation and also discuss some of its limitations.

4. To examine new trends in adequacy litigation.

Following a brief introduction that provides historical background, we pro- vide a more detailed discussion of the legal theory and relevant cases in each of the three waves of school finance litigation.

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C. Roellke, P. Green, E. Zielewski

Three Waves of School Finance Litigation

Scholars have divided school finance litigation into three waves, each dominated by one legal theory (Enrich, 1995; Heise, 1995; Thro, 1994; Verstegen, 1998). The first two waves were dominated by equity ap- proaches, whereas the third wave has been driven by adequacy claims.

* First Wave (approximately 1969 through 1973): Plaintiffs challenged school finance systems through the federal Constitution's equal pro- tection clause (e.g., San Antonio Independent School District v. Rodri- guez, 1973; Serrano v. Priest, 1971 [Serrano I]).

* Second Wave (approximately 1973 to 1989): Plaintiffs challenged school finance systems through state education, equal protection clauses, or both (e.g., Board of Education, Levittown Union Free School District v. Nyquist, 1982; Hornbeck v. Somerset County Board of Educa- tion, 1983).

* Third Wave (approximately 1989 to the present): Plaintiffs allege that school finance formulas prevent poor school districts from pro- viding an adequate education as defined by state education clauses (e.g., McDuffy v. Secretary of the Executive Office of Education, 1993; Rose v. Councilfor Better Education, 1989).

First-wave plaintiffs were influenced by the work of Arthur Wise (1968) and Coons, Clune, and Sugarman (1970). Wise observed that poor districts could not provide the same level of educational funding as their richer counterparts, even if they taxed at a higher rate. He concluded that school finance systems violated the equal protection clause because educational opportunity was based on the wealth of the districts in which students lived. Coons et al. developed the concept of "fiscal neutrality," meaning that the quality of education may not be a function of wealth other than that of the entire state. In school finance litigation, plaintiffs built on these arguments in an attempt to establish "wealth as a suspect classification" under the U.S. Constitution. Central to this argument is the notion that liv- ing in poverty establishes a set of discriminatory conditions that warrants "strict scrutiny" by the courts. Strict scrutiny, commonly granted for sus- pect classifications such as race or in claims involving fundamental rights, is the most rigorous level of examination for courts to apply to equal pro- tection clause challenges.

The California Supreme Court accepted these arguments in Serrano I (1971) and found that education was a fundamental interest and wealth was a suspect classification. In San Antonio Independent School District v. Ro-

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School Finance Litigation

driguez (1973), however, the U.S. Supreme Court rejected fundamental right and suspect classification claims, abruptly ending first-wave litiga- tion. Less than 2 weeks after the San Antonio decision, the New Jersey Supreme Court in Robinson v. Cahill (1973) invalidated the state's school fi- nance system, citing the state constitution's "thorough and efficient" edu- cation clause: "the Legislature should shall provide for the maintenance and support of a thorough and efficient system of free public schools for the instruction of all the children in this state" (New Jersey Constitution Arti- cle 8, Section IV, Paragraph 1, emphasis added). Respecting legislative powers, second-wave courts were not prescriptive in their mandates. Courts generally sent legislatures "back to the drawing board" to construct equity-enhancing legislation. The New Jersey court, for example, set dead- lines for the legislature no less than seven times and finally had to threaten a closing of the entire school system if the legislature did not act (Yudof, Kirp, & Levin, 1992). In addition, the unevenness of second-wave litigation is illustrated by the rejection of the thorough and efficient claims by Mary- land's Court of Appeals in Hornbeck v. Somerset County Board of Education (1983). The court found that "thorough and efficient" did not mean "uni- formity in per-pupil expenditures," nor did it "require a system which pro- vides more than a basic or adequate education" (p. 776).

Although the state education clause had been a successful litigation tool for plaintiffs since Robinson, courts had been unwilling to mandate specific finance reforms. In contrast, the third-wave courts have taken thorough and efficient claims to a new level and have mandated rather specific re- form initiatives. In Rose v. Councilfor Better Education (1989), for example, the Kentucky State Supreme Court defined what should constitute an effi- cient system of common schools. Among the most prescriptive of third-wave courts, the Kentucky court outlined seven expected student outcomes, including "understanding of governmental processes," "suffi- cient grounding in the arts," and "knowledge of his or her own mental and physical wellness" (p. 212).

Scholars have asserted that these third-wave adequacy strategies are su- perior to the equity strategies employed in the previous two waves. In- deed, third-wave litigation has enjoyed greater success than the previous two waves. Several factors, however, may limit the longer term success of third-wave litigation, thus forcing plaintiffs to develop alternative litiga- tion strategies (Baker & Green, 2003; Green, 2000; Green & Baker, 2002; Morgan, 2001; Ryan, 1999). Although the impact of third-wave litigation remains to be seen, these decisions do provide some optimism for school finance reformers. We now turn to a more specific discussion of key cases in each wave of school finance litigation.

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First-Wave Litigation

During the first wave of school finance litigation, plaintiffs asserted that school finance disparities violated the equal protection clause of the U.S. Constitution, which provides that no state "shall deny to any person within its jurisdiction the equal protection of the laws." A summary of key first-wave cases is provided in Table 1.

Courts have developed three levels of scrutiny to determine under what circumstances a state may treat individuals differently without violating the equal protection clause. As mentioned earlier, they apply strict scru- tiny, which is the most difficult level for the state to overcome, when the government classification affects "suspect classes" such as race, or the clas- sification involves a fundamental interest that is protected by the Constitu- tion. Classifications subject to strict scrutiny must be narrowly tailored to satisfy a compelling governmental interest. Courts apply heightened, or intermediate, scrutiny to gender classifications. Such classifications must be substantially related to important state interests. All other classifica- tions are subject to minimal scrutiny, which is also known as the rational basis test. Such classifications must be rationally related to a legitimate governmental interest.

The first attempts to mount equal protection clause challenges to school finance disparities were unsuccessful because courts found that (a) ratio- nal basis instead of strict scrutiny was applicable, and (b) there were no measurable standards for determining how educational aid should be dis- tributed. In McInnis v. Shapiro (1968), plaintiffs asserted that Illinois' school finance system, which guaranteed a foundation level of $400 per student and called for local property taxation, violated the equal protection clause because it permitted "wide variations in the expenditures per student from district to district, thereby providing some students with a good education and depriving others, who have equal or greater educational need" (p. 329). Plaintiffs also claimed that "the importance of education to the wel- fare of individuals and the nation requires courts to invalidate the legisla- tion if potential, alternative statutes incorporating the desirable aspects of the present system can also achieve substantially equally resources" (p. 331). Plaintiffs identified two alternatives that would be less discrimina- tory to poor school districts: (a) providing the same dollar appropriations to all students, or (b) "siphon[ing] off all money in excess of $X per pupil which was produced by a given tax rate" (p. 332).

A federal district court dismissed the plaintiffs' complaint. The court re- fused to find that the Supreme Court's school desegregation decisions obliged Illinois to provide equal educational opportunity. The school de- segregation cases were distinguished because the state legislatures em-

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School Finance Litigation

Table 1

First-Wave School Finance Litigation

Burruss v. Wilkerson

(VA)

Serrano v. Priest (CA)

San Antonio Independent School District v.

Rodriguez (TX)

1969 The plaintiffs in this case argued that the Virginia state school finance system was unconstitutional because of the wide disparities in per-pupil educational spending. They argued that, because education is a fundamental right, any spending differences need be related to educational need and not property wealth. The court, however, ruled that the cases were

nonjusticiable because the court had no standard for educational need to assess the

claims of the plaintiffs. 1971 The plaintiffs in this case argued that disparities in

per-pupil spending across various school districts violated the equal protection clause of the U.S. Constitution, particularly if education was considered to be a "fundamental right" guaranteed by the Constitution. The California Supreme Court agreed and ruled education a fundamental constitutional right and remanded the case for trial.

1973 The plaintiffs claimed that Texas's system for financing public education violated the Equal Protection Clause of the Fourteenth

Amendment because it discriminated on the

basis of wealth. The Supreme Court reversed a ruling by a federal district court and upheld the Texas system stating that wealth is not a suspect classification and the state's funding system was rational and constitutional.

ployed racial classifications, which were inherently suspect. Applying the rational basis test, the court concluded that permitting school districts to determine their own tax burden was a reasonable means to encourage lo- cal choice and experimentation.

Moreover, the court dismissed the complaint because "there are no 'discoverable and manageable standards' by which a court can determine when the Constitution is satisfied and when it is violated" (p. 335). The court found that the only workable standard was the "rigid assumption that each pupil must receive the same dollar expenditures" (p. 335). How- ever, expenditures were not the only benchmark for determining a child's educational needs. For instance, the court observed that expenditures in a small district may not go as far as expenditures in a large district. The court further cautioned that "[a]s new teaching methods are devised and as ur- ban growth demands changed patterns of instruction, the only realistic

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way the state can adjust is through legislative study, discussion and contin- uing revision of the controlling statutes" (p. 336). Even if guidelines were available to the judiciary, "the courts simply cannot provide the empirical research and consultation necessary for intelligent educational planning" (p. 336).

In Burruss v. Wilkerson (1969), a federal district court denied plaintiffs' claim that Virginia's school finance system violated the equal protection clause. The court found that the plaintiffs' goal of obtaining resources for all districts so that they could receive equal educational opportunities was commendable. Still, the court refused to grant such relief because it had "neither the knowledge, nor the means, nor the power to tailor the public money to fit the varying needs of these students throughout the State" (p. 574). Rather, the court saw that its sole responsibility was to ensure that "the outlays on one group are not invidiously greater or less than that of another" (p. 574). Applying this standard, the court found that the school finance system did not violate the equal protection clause.

Two years after the Mclnnis v. Shapiro (1968) and Shapiro and Burruss v. Wilkerson (1969) decisions, the California Supreme Court in Serrano I (1971) applied strict scrutiny to hold that the state's school finance system vio- lated the federal and state equal protection clauses. The court found that strict scrutiny was applicable because wealth was a suspect classification. It then found that the school finance system discriminated on the basis of wealth because "districts with small tax bases simply cannot levy taxes at a rate sufficient to produce the revenue that more affluent districts reap with minimal tax efforts" (p. 1250). This standard was an adaptation of Coons et al.'s (1970) concept of fiscal neutrality: The quality of education should not be a function of district wealth, but of state wealth.

Strict scrutiny was also applicable because the importance of education made it a fundamental interest under the U.S. Constitution. The court

found that the following passage from Brown v. Board of Education (1954), a case in which the Supreme Court invalidated the policy of racial segrega- tion of elementary and secondary public schools, was the "classic expres- sion of this position" (Serrano I, 1971, p. 1256):

Today, education is perhaps the most important function of state and local governments. Compulsory school attendance laws and the great expenditures for education both demonstrate our recognition of the im- portance of education to our democratic society. It is required in the per- formance of our most basic public responsibilities, even service in the armed forces. It is the very foundation of good citizenship. Today it is a principal instrument in awakening the child to cultural values, in pre- paring him for later professional training, and in helping him to adjust

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normally to his environment. In these days, it is doubtful that any child may reasonably be expected to succeed in life if he is denied the opportu- nity of an education. Such an opportunity, where the state has under- taken to provide it, is a right which must be made available to all on equal terms. (Brown v. Board of Education, 1954, p. 493)

The court then rejected the assertion that the fiscal scheme was neces- sary to advance local administrative control because "[n]o matter how the state decides to finance its system of public education, it can still leave this decision-making power in the hands of local districts" (p. 610). The court also rejected the claim that local property taxation was necessary to pro- mote local fiscal choice. In fact, poor districts were deprived of fiscal choice because their low tax bases limited the amount of money they could spend on education.

In San Antonio Independent School District v. Rodriguez (1973), however, the U.S. Supreme Court ended the first wave by ruling that Texas's reliance on local property taxation did not violate the equal protection clause. The Court refused to find that strict scrutiny was applicable on the grounds that education was a fundamental right. As the Court explained: "The key to discovering whether education is 'fundamental' is not to be found in comparisons of the relative societal significance of education. Rather, the answer lies in assessing whether there is a right to education explicitly or implicitly guaranteed by the Constitution" (p. 33). Employing this test, the Court ruled that education was not "among the rights afforded explicit protection under our Federal Constitution" (p. 34). Further, the Court re- fused to find that education was implicitly protected by the Constitution because it was necessary for the effective exercise of such constitutional guarantees as freedom of speech and the right to vote. Although guaran- teeing that citizens can speak effectively or vote intelligently were desir- able goals, they were "not values to be implemented by judicial intrusion into otherwise legitimate state activities" (p. 36).

Further, the San Antonio Court refused to find that strict scrutiny was applicable because wealth was a suspect classification. Although the court acknowledged that it had found wealth discrimination to constitute a sus- pect class in prior cases, it also observed that the individuals who made up these classes had two distinguishing characteristics: (a) they had been completely deprived of a benefit because of their poverty, and (b) the plain- tiffs represented a clearly definable class of poor persons. The court then rejected the claim that the system discriminated against a suspect class of poor persons because the plaintiffs provided no evidence that the state's poor persons were concentrated around the poorest school districts and were completely deprived of an education.

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The court also rejected the contention that the system discriminated against a suspect class of individuals who lived in comparatively poor school districts. This decision raised doubts about whether such a class

could ever be considered "suspect," and observed that, in any event, the plaintiffs failed to establish a direct correlation between family wealth within each district and expenditures for education. Finally, the court re- fused to find that district wealth was a suspect classification because

[t]he system of alleged discrimination and the class it defines have none of the traditional indicia of suspectness: the class is not saddled with such disabilities, or subjected to such a history of purposeful unequal treatment, or relegated to such a position of political powerlessness as to command extraordinary protection from the majoritarian political pro- cess. (p. 28)

Applying the rational basis test, the court then held that the use of local property taxation was related rationally to encouraging local control of the public schools. By becoming involved in educational decisions at the local level, community members demonstrated their depth of commitment to public education. Local control also provided each locality with the means for participating "in the decision making process of determining how local tax dollars will be spent" (p. 50). In addition, local control enabled school districts "to tailor local plans for local needs" and encouraged "experimen- tation, innovation, and a healthy competition for educational excellence" (p. 50). In denying fundamental right status and suspect classification sta- tus, and in accepting local control arguments, the U.S. Supreme Court put an end to the first wave of school finance litigation.

Second-Wave Litigation

During the second wave, which lasted from about 1973 to 1989, plain- tiffs responded to San Antonio Independent School District v. Rodriguez (1973) by mounting equity challenges primarily through state education and equal protection clauses. A summary of selected key cases in the second wave is provided in Table 2.

Although plaintiffs have had some success, most state courts rejected second-wave equality challenges. The remainder of this section analyzes six reasons for the failure of first- and second-wave litigation:

1. Many courts have been unwilling to give fundamental rights status to education.

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Table 2

Second-Wave School Finance Litigation

Serrano v. Priest II 1977 The California Supreme Court reaffirmed its prior (CA) decision in Serrano I and affirmed the lower court's

finding that the wealth-related disparities in per-pupil spending generated by the state's education finance system violated the equal protection clause of the California constitution.

Olsen v. State ex rel. 1976 The plaintiffs in the case argued that Oregon's Johnson (OR) funding system violated Article VIII, section 3 of

the Oregon Constitution, which states that, "(t)he Legislative Assembly shall provide by law for the establishment of a uniform, and general system of Common schools." The Oregon Supreme Court rejected this argument, holding that the state satisfies its obligation if it requires and provides for a minimum of educational opportunities in local school districts and permits the districts to exercise local control over what they desire, and can furnish, over the minimum.

Washakie County School 1980 The Wyoming Supreme Court found that the state District v. Herschler education funding system violated the state (WY) constitution's equity requirement, noting that "until

the equality of financing is achieved, there is no practicable method of achieving the equality of quality." The Court ruled that public education is a fundamental right under the Wyoming Constitution and matched "equality of financing" with "equality of quality."

Board of Education, 1982 The New York Court of Appeals held that despite the Levittown Union Free unequal education, New York State had acted School District v. constitutionally in its financing structure because Nyquist (NY) the state constitution does not refer to an equal

education and equitable funding and also because the plaintiffs made no claim that the quality or quantity of education in these poor districts was below that of the minimum set by the New York State Board of Regents.

Horton v. Meskill (CT) 1977 The Connecticut Supreme Court held that the right to education in Connecticut is so basic and

fundamental that any intrusion on the right must be strictly scrutinized. Public school students are entitled to equal enjoyment of the right to education, and a system of school financing that relied on local property tax revenues without regard to disparities in town wealth and that lacked significant equalizing state support was unconstitutional.

(continued)

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Table 2 (Continued)

DuPree v. Alma School

District No. 30 of Crawford County

(AR)

Hornbeck v. Somerset

County Board of Education (MD)

1983 The Arkansas Supreme Court found the state's school funding system unconstitutional under the equal protection clause of the state constitution holding that "no legitimate state purpose" and "no rational relationship" to "educational needs" in the state's method of financing public schools. This equity ruling rejected "local control" as justification for the disparities of funding and educational opportunities in the state's school districts.

1983 Maryland's State Supreme Court held that the state constitution did not mandate equality in per-pupil spending among the state's school districts. However, the court also held that the education

clause of the Maryland constitution embodies a right to "an adequate education measured by contemporarv educational standards."

2. Courts have been unwilling to classify wealth as a suspect class. 3. The courts have accepted the local control doctrine as a reasonable

defense for inequities. 4. Courts have found that education clauses do not require equal edu-

cational opportunity. 5. Equity is a deceptively difficult concept to measure. 6. Many urban school districts may no longer be supportive of equity

litigation.

An analysis of each of these rationales follows.

Denial of Fundamental Rights Status

Plaintiffs argued that strict scrutiny should be applied to their state equal protection challenges because education was a fundamental interest under their state constitutions. On three occasions, plaintiffs were success- ful. In Serrano v. Priest (1976 [Serrano II]), the California Supreme Court ruled that San Antonio Independent School District v. Rodriguez (1973) left in- tact its holding in Serrano I (1971) that education was a fundamental inter- est under the state constitution because of its importance to society. In Hor- ton v. Meskill (1977), the Connecticut Supreme Court held that education was a fundamental interest in part because of the long history of public ed- ucation in the state. In Washakie County School District v. Herschler (1980), the Supreme Court of Wyoming found that "[i]n the light of the emphasis

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School Finance Litigation

which the Wyoming Constitution places on education, there is no room for any conclusion but that education for the children of Wyoming is a matter of fundamental interest" (p. 333)

However, most state courts addressing this issue have concluded that strict scrutiny should not be applied on the grounds that education was a fundamental interest under state constitutions. Several courts have re-

fused to apply the San Antonio fundamental interest test, which is signifi- cant because virtually every state has an education clause that establishes its duty to provide an educational system. Because education is explicitly mentioned in most state constitutions, an application of the San Antonio test would probably lead courts to conclude that education is a fundamen- tal interest warranting strict scrutiny. Fair School Finance Council of Oklahoma v. State (1987), an Oklahoma school finance case, is illustrative. The Supreme Court of Oklahoma acknowledged that if it adopted the San Antonio test, "then educational opportunity would arguably be a funda- mental interest in Oklahoma entitled to strict scrutiny" (pp. 1148-1149). However, the court found that the Rodriguez test was inappropriate be- cause

The United States Constitution is one of restricted authority and dele- gated powers. By contrast our state constitution is not one of limited powers where the State's authority is restricted to the four corners of the document. Rather, the Oklahoma Constitution addresses not only those areas deemed fundamental but also others, which could have been left to

statutory enactment. While the Congress of the United States may do only what the federal constitution has granted it the power to do, our state Legislature generally may do, as to proper subjects of legislation, all but that which it is prohibited from doing. Thus, under the Oklahoma Constitution, fundamental rights are not necessarily determined by whether they are provided for within the document. (p. 1149)

Moreover, several courts refused to follow the finding of Serrano I and II that education was a fundamental interest because of its importance to so- ciety. According to these courts, determining the importance of education would violate the doctrine of "separation of powers," which refers to the duties assumed by the legislative, executive, and judicial branches of gov- ernment. These courts found that determining the importance of educa- tion is a matter for the legislature, not the judiciary. For example, in Lujan v. Colorado State Board of Education (1982), the Supreme Court of Colorado ac- knowledged "unequivocally that public education plays a vital role in our free society" (p. 1017). However, the court refused to find that education is a fundamental interest because

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While our representative form of government and democratic society may benefit to a greater degree from a public school system in which each school district spends the exact dollar amount per student with an eye toward providing identical education for all, these are consider- ations and goals which properly lie within the legislative domain. Judi- cial intrusion to weigh such considerations and achieve such goals must be avoided. This is especially so in this case where the controversy, as we perceive it, is essentially directed toward what is the best public policy which can be adopted to attain quality schooling and equal educational opportunity for all children who attend our public schools. (p. 1018)

Finally, a number of courts refused to find that education is a fundamen- tal interest because of the concern that invalidating local property taxation to raise educational aid would lead to the invalidation of such taxation for

other necessary governmental services. These courts found support for this position from the following passage from San Antonio:

[I]f local taxation for local expenditures were an unconstitutional method of providing for education then it might be an equally imper- missible means of providing other necessary services customarily fi- nanced largely from local property taxes, including local police and fire protection, public health and hospitals, and public utility facilities of various kinds. We perceive no justification for such a severe denigration of local property taxation and control as would follow from appellees' contentions. It has simply never been within the constitutional preroga- tive of this court to nullify statewide measures for financing public ser- vices merely because the burdens or benefits thereof fall unevenly de- pending upon the relative wealth of the political subdivisions in which citizens live. (p. 54)

Denial of Wealth as a Suspect Classification

Plaintiffs' attempts to convince courts to apply strict scrutiny because wealth is a suspect classification have been unsuccessful. In Lujan v. Colo- rado State Board of Education (1982), for example, the Supreme Court of Col- orado ruled that plaintiffs had failed to establish a suspect class of low-in- come persons or low-wealth school districts. There was no evidence that "poor persons in Colorado are concentrated in low-property wealth dis- tricts, or that they uniformly or consistently receive a lower quality educa- tion, or that the districts in which they reside uniformly or consistently ex- pend less money on education" (p. 1020). The court further concluded that

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School Finance Litigation

even if wealth were a recognized class for equal protection purposes, wealth alone would not constitute a suspect classification in Colorado. This was because there was no evidence that the state had subjected poor persons to purposeful unequal treatment. In fact, a review of the school fi- nance system revealed that the opposite was true in that the system had historically sought to equalize education among districts.

Acceptance of Local Control Doctrine

Instead of strict scrutiny, state courts have generally followed the lead of Rodriguez and applied rational basis analysis to state equal protection clause claims. As was the case in San Antonio, plaintiffs had to overcome the local control doctrine. During the second wave, only the Arkansas Su- preme Court held that disparities created by local property taxation were not rationally related to the purpose of maintaining local control (DuPree v. Alma School District No. 30 of Crawford County, 1983). However, most courts have found that local property taxation was rationally related to the pur- pose of maintaining local control (Green & Baker, 2002). In Thompson v. Engelking (1975), the Idaho Supreme Court captured the importance of lo- cal control in the following passage:

Traditionally, not only in Idaho but throughout most of the states of the Union, the legislature has left the establishment, control and manage- ment of the school to the parents and taxpayers in the community which it serves. The local residents organized the school district pursuant to en- abling legislation, imposed taxes upon themselves, built their own schoolhouse, elected their own trustees and through them managed their own school. It was under these circumstances that the "Little Red

School House" became an American institution, the center of commu- nity life, and a pillar in the American conception of freedom in educa- tion, and in local control of institutions of local concern. In the American

concept, there is no greater right to the supervision of the education of the child than that of the parent. In no other hands could it be safer.

The American people made a wise choice early in their history by not only creating forty-eight state system of education, but also by retaining within the community, close to parental observation, the actual direction and control of the educational program. This tradition of community ad- ministration is a firmly accepted and deeply rooted policy. (p. 645)

Rich districts have found arguments for local governmental and fiscal autonomy effective in maintaining their competitive advantages in pro-

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viding educational services and post-school opportunities for their stu- dents. Enrich (1995) explained the appeal of this doctrine to rich school dis- tricts in the following manner:

The argument for local control has the great virtue of framing [the con- cerns of rich districts] in an apparently neutral manner. Local control over local resources gives all districts, not merely the wealthy ones, the power to decide how heavily to spend on schools. And it guarantees to all districts, whatever their wealth, that local resources are spent to bene- fit local children. The fact that these universal attributes of local control

have radically different implications for differently situated districts does not strip the structure of its formal neutrality, making it an ideal guise for the defense of privilege. (pp. 159-160)

Education Clauses Do Not Require Equal Educational Opportunity

Equity claims based on state education clauses most frequently in- volved provisions that required states to provide "general," "uniform," or "efficient" systems (Patt, 1999). However, these claims have been unsuc- cessful because courts refused to find that state education clauses required equity. In one representative case, Olsen v. State ex rel. Johnson (1976), the Supreme Court of Oregon rejected the assertion that the state education clause, which requires the legislature to "provide by law for the establish- ment of a uniform and general system of Common schools," mandated equal educational opportunity (p. 8). Instead, the court found that the con- stitutional mandate would be met "if the state requires and provides for a minimum of educational opportunities in the district and permits the dis- tricts to exercise local control over what they desire, and can furnish, over the minimum" (p. 2). The court went on to find that Oregon's school fund- ing system satisfied this mandate.

Complexities of Equity

Enrich (1995) observed "The very idea of equality evokes the imagery of simple quantitative comparisons. But, in the context of education funding, the imagery has proven deceptive, because the appropriate dimension for comparison has proven elusive" (p. 145). Enrich identified a number of equality measures that courts could use. A major weakness of these formu- lations is they fail to make a clear connection between differential govern-

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mental treatment and the impact on the quality of children's education. Some equity measures have focused on differential governmental treat- ment. An example of this type of measurement is actual funding among districts. This standard has the virtues of being easily quantifiable and widely viewed as a means for comparing the quality of education among school systems. However, designing a remedy for this measure would be difficult because it fails to account for other factors that might cause differ- ences in educational quality. Furthermore, remedies that seek to address spending disparities might be susceptible to attacks that they interfere with local political autonomy (Enrich, 1995).

Other equity measures have focused on the quality of education. An ex- ample of this type of measure is student outcomes. Measurable outcomes could include preparation for the workplace, higher education, and soci- ety. This measure has the virtue of focusing on the fundamental aspect of equality. Any equalization measure that fails to bring about equality in outcomes might be of questionable value. However, designing a remedy for this measure would be problematic because it focuses on differences for which the school finance system might not be responsible (Enrich, 1995).

Courts have also justified their restraint in striking down state finance funding formulae by citing research questioning the impact of increased spending on educational achievement and other outcomes. This research, a continuing source of controversy, has had significant impact on school fi- nance litigation and educational policy debates. A series of literature re- views by Hanushek (1981, 1986, 1996, 1997) have shown a high level of in- consistent and insignificant findings across studies estimating the impact of various types of educational investments. On the other hand, research- ers who have reanalyzed Hanushek's data, challenging both his assump- tions and his basic "vote counting" methodology, have reported more pos- itive and consistent interpretations of the same set of studies (Hedges, Laine, & Greenwald, 1994; Laine, Greenwald, & Hedges, 1996). This debate has been ongoing since the earliest first-wave cases, including San Antonio. Justice Powell's opinion, for example, argued that the evidence suggesting that school resources do not appear to influence student achievement was a valid reason for exercising judicial caution:

Indeed, one of the major sources of controversy concerns the extent to which there is a demonstrable correlation between educational expendi- tures and the quality of education.... In such circumstances the judiciary is well-advised to refrain from imposing on the States inflexible constitu- tional restraints. (San Antonio Independent School District. v. Rodriguez, 1973, p. 42-43)

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Declining Interest of Urban School Districts

Moreover, many urban districts might not be interested in equity litiga- tion because they might lose financially if per-pupil spending were equal- ized (Heise, 1995). Urban school districts participated in school finance liti- gation because they received less per-pupil dollars than their suburban counterparts. These districts were also confronted with the problems of "high non-educational municipal expenditures, and relatively high-edu- cation-cost-students" (p. 1172). Because states have responded to equity litigation through cost- and needs-adjusted funding formulas, many urban districts with large percentages of minority students now receive more ed- ucational funding than state averages. As a result, they might be less inter- ested in participating in equity litigation (Heise, 1995).

Third-Wave Litigation

Throughout third-wave litigation, which started in 1989 and has lasted to the present time, plaintiffs have argued that school finance systems pre- vent poor districts from providing their students with an adequate educa- tion. This strategy uses state education clauses, which define the state's constitutional duty to provide an education. The seminal third-wave case is Rose v. Councilfor Better Education (1989). In this case, the Kentucky Su- preme Court ruled that the state's educational system violated its educa- tion clause by failing to provide its students with an adequate education. The court then identified several capacities that the state had to fulfill to reach its constitutional mandate, including the provision of sufficient oral and written communication skills as well as academic or vocational skills.

Another important third-wave victory for plaintiffs was the recent New York Court of Appeals ruling in Campaign for Fiscal Equity v. State (2003). The 4 to 1 decision overturned a 2002 state appellate court ruling that the state was responsible for providing only an eighth- or ninth-grade educa- tion. The higher court ruled that a "sound basic education" goes beyond eighth or ninth grade and should include a "meaningful high school edu- cation." The remedy laid out by the Court of Appeals requires a cost- ing-out study (to be completed by March 2004) to determine a dollar amount that can ensure that all students have the opportunity to obtain this higher level of achievement specified by the court. Additional key cases in the third wave are summarized in Table 3. In the following section, we discuss Rebell's (2001) core concept of a constitutionally adequate edu- cation, analyze possible reasons for the success of third-wave litigation,

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Table 3

Third-Wave School Finance Litiga

Edgewood v. Kirby (TX)

DeRolph v. Ohio (OH)

Rose v. Councilfor Better Education (KY)

Campaignfor Fiscal Equity v. State (NY)

ition

1989 The Edgewood court held that Texas's public education financing, with its strong focus on property tax, did not ensure an efficient education for all schoolchildren because the

system failed to address the differences in revenue-raising ability among districts. As a result, the court found the financing system to be unconstitutional.

1997 In 1991, a coalition of plaintiffs filed suit claiming that the education provided in their Ohio schools was constitutionally inadequate. The trial court ruled for the plaintiffs, relying

heavily on the Kentucky court's prior articulation of adequacy standards in elaborating the Ohio constitution's requirements. On appeal, the Ohio Supreme Court, in 1997, upheld the trial court's decision and found the state's education finance system was unconstitutional.

1989 The plaintiffs in this case argued that Kentucky's system of school finance was inadequate and as such violated the state's education clause as

well as the equal protection clause and due process of the law clause of the Fourteenth Amendment to the U.S. Constitution. The

Kentucky Supreme Court ruled in favor of the plaintiffs ruling that the existing system of finance did not satisfy the requirement of an efficient educational system and created a standard of an "efficient system of common schools."

2003 The plaintiffs in this cased charged that New York State was failing in its constitutional duty to provide the opportunity for a sound basic education to hundreds of thousands of its

schoolchildren. The New York Court of

Appeals, the state's highest court, ruled that every public school student is entitled to the opportunity for a meaningful high school education. The Court ordered the state to

implement major education funding and accountability reforms to allow students in New York City schools to meet this constitutional standard.

(continued)

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Table 3 (Continued)

McDuffy v. Secretary of the 1993 The plaintiffs in the case, Massachusetts students, Executive Office of claimed that their less wealthy school districts Education (MA) were unable to provide them with an

"adequate" education. The Massachusetts Supreme Court ruled in favor of the plaintiffs holding that "'the duty of legislatures and magistrates, in all future periods of this Commonwealth, to cherish ... public schools and grammar schools in the towns' includes the duty to provide an adequate education to the young people of the State, and that this duty is 'an enforceable obligation of the Commonwealth."'

and identify constraints that may ultimately limit the effectiveness of ade- quacy approaches.

Rebell's Core Concept of an Adequate Education

According to Rebell (2001), a core concept of an adequate education has arisen from successful third-wave adequacy cases. First, courts have de- fined an adequate education as one that prepares students for life in a com- petitive society (Rebell, 2001). For instance, the Kentucky Supreme Court in Rose v. Councilfor Better Education (1989) defined an adequate education as one that provides "sufficient knowledge of economic, social and politi- cal systems to enable the student to make informed choices," and "suffi- cient understanding of governmental processes to enable the student to understand the issues that affect his or her community, state and nation" (p. 25). The Wyoming Supreme Court in Campbell County School District v. State (1995) found that the state's education article obliged the legislature "to provide an education system of a character which provides Wyoming students with a uniform opportunity to become equipped for their future role as citizens, participants in the political system" (p. 1259). In Claremont School District v. Governor (1993 [Claremont IJ), the New Hampshire Su- preme Court held that an adequate education "includes broad educational opportunities needed in today's society to prepare citizens for their role as participants and as potential competitors in today's marketplace of ideas" (p. 1381).

Second, courts have found that an adequate education evolves to take into account the present needs of the students (Rebell, 2001; also see

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Verstegen & Knoeppel, 1998). One finds support for this notion in the 2003 Campaignfor Fiscal Equity v. State decision. As mentioned earlier, the court rejected the state's argument that the state satisfied its constitutional man- date by providing an eighth- or ninth-grade education to its students for the following reasons:

A high school education is today as indispensable as a primary educa- tion was in 1894. Children in the 21st century need the opportunity for more than a ninth grade education to be productive citizens. Back in the 19th century, a high school education was not needed to obtain a good job. Now, a high school education is a prerequisite to most good jobs. Those who lack a high school education and have obtained good jobs have done so in spite of, not because of, the lack of a high school educa- tion. While it may be true that there will always be menial low-skills jobs, and thus a need for people to fill them, it should not be the purpose of the public schools to prepare students for those jobs, which are limited in number and dwindling. (p. 18)

Third, as this quote from Campaign for Fiscal Equity v. State (2003) dem- onstrates, an adequate education is one that provides students with greater than minimal preparation (Rebell, 2001). One finds further support from the Supreme Court of Wyoming's definition of adequacy in the Campbell County School District v. State (1995) case. This court found that an adequate education included "setting of meaningful standards for course content and knowledge attainment intended to achieve the legislative goal of equipping all students for entry to the University of Wyoming and Wyo- ming Community Colleges or which will achieve the other purposes of ed- ucation" (p. 1279).

Finally, Rebell found that "courts tend to enforce students' rights to an adequate education ... by seeking to ensure the availability of essential re- sources, such as decent facilities, a safe environment, qualified teachers, and up-to-date textbooks ... that will give all students the opportunity to develop necessary academic skills" (p. 242). However, courts have not de- fined the states' constitutional duty in terms of obtaining educational out- comes. Rebell noted that state educational standards that have been devel-

oped through the national standards-based reform movement have served as useful tools in determining the level of resources necessary to satisfy the states' educational mandate. This is because the state standards have pro- vided benchmarks for determining whether the state is providing suffi- cient resources. For example, in Abbott v. Burke (1997), the Supreme Court of New Jersey found that the state legislature's set of content standards "are facially adequate as a reasonable legislative definition of a constitu-

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tional thorough and efficient education" (p. 428). However, the school fi- nance system failed to provide a constitutionally adequate education to poor urban districts "[b]ecause [it] does not in any concrete way attempt to link the content standards to the actual funding needed to deliver that con- tent" (p. 429).

Strengths of Adequacy Approaches

School finance scholars have argued that third-wave adequacy litiga- tion has been more successful than equity challenges because it addresses several problems that limited first- and second-wave challenges. The first advantage derives from the limited scope of the education clause (Enrich, 1995; Rebell, 2001). In San Antonio, the Supreme Court worried that a hold- ing that school finance formulas violated the equal protection clause might be applied to funding disparities outside of the educational realm. This re- sult would have been undesirable because "[h]ow, for instance, is educa- tion to be distinguished from the significant personal interests in the basics of decent food and shelter? Empirical examination might well buttress an assumption that the ill-fed, ill- clothed, and ill-housed are among the most ineffective participants in the political process" (p. 37). By contrast, deci- sions based on state education clauses are inapplicable to disparities in other governmental programs because the education is limited solely to education (Enrich, 1995; Rebell, 2001).

Second, adequacy approaches may enable plaintiffs to circumvent the separation of powers defense. Recall that during the first and second wave, several courts refused to find a constitutional violation because (a) deter- mining the importance of education was a matter left to the legislature, not the courts; and (b) no judicially manageable standard was available to en- able courts to determine whether a constitutional violation had not oc-

curred. By contrast, in successful third-wave litigation, courts have pro- vided guidelines for determining whether an adequate education was being satisfied and then left it to the legislature to implement these guide- lines. They have found that this process correctly applies the judiciary's and legislature's roles under the doctrine of separation of powers. Clare- mont School District v. Governor (1997 [Claremont II]), a New Hampshire case, is illustrative. In Claremont II, the New Hampshire Supreme Court struck down the school finance system because the state's disproportion- ate tax burdens prevented the state from providing an adequate education. The court rejected the argument that local property taxation was justified by local control. As the court explained,

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We recognize that local control plays a valuable role in public education; however, the State cannot use local control as a justification for allowing the existence of educational services below the level of constitutional ad-

equacy. The responsibility for ensuring the provision of an adequate public education and an adequate level of resources for all students in New Hampshire lies with the State. [W]hile local governments may be required, in part, to support public schools, it is the responsibility of the [State] to take such steps as may be required in each instance effectively to devise a plan and sources of funds sufficient to meet the constitutional mandate. (pp. 475-476, internal quotations omitted)

Third, scholars have asserted that the national accountability move- ment has helped with the development of measurable standards for deter- mining whether legislatures are satisfying their constitutional duty (En- rich, 1995; Heise, 1995; McUsic, 1991; Rebell, 2001). In 1983, the National Commission on Excellence reported in A Nation at Risk that "[t]he educa- tional foundations of our society are presently being eroded by a rising tide of mediocrity that threatens our very future as a Nation and a people" (p. 5). This report also suggested that schools should develop standards to de- termine whether students were learning at an acceptable level. States re- sponded to this call by developing educational standards to measure whether the state has provided students with a meaningful opportunity to learn (Heise, 1995). Heise observed that "[s]tates and school districts that develop such standards also may be constructing an educational standard of care that courts might look to when assessing the adequacy of a school system" (p. 1176). The federal government's enactment of the No Child Left Behind Act of 2001 might result in more adequacy litigation. The No Child Left Behind Act requires each state to (a) develop standards for math, reading, and science; and (b) teach every student's progress toward tests that are aligned with these standards.

Fourth, school finance scholars have asserted that adequacy litigation may enable courts to overcome local control concerns (Enrich, 1995; Heise, 1995; Rebell, 2001). One reason for this claim is that adequacy arguments might be more politically palatable to affluent school districts. School dis- tricts can still choose to raise extra funds by raising local property taxation. Further, affluent districts are more likely to support adequacy litigation be- cause it promises not to lower the educational opportunities available to affluent students but to raise the opportunities available to all students. Thus, affluent districts are not penalized for their academic success. Fur- ther, several courts have rejected the doctrine of local control as a defense to plaintiffs' constitutional adequacy claims. Recall that this defense proved very difficult for plaintiffs to overcome during the second wave. In

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successful third-wave litigation, courts have found that the doctrine of lo- cal control does not excuse states from their obligation to provide all dis- tricts with an adequate education. As the Kentucky Supreme Court ex- plained in Rose v. Councilfor Better Education (1989):

[The education clause] requires the General Assembly to establish a sys- tem of common schools that provides an equal opportunity for children to have an adequate education. In no way does this constitutional re- quirement act as a limitation on the General Assembly's power to create local school entities and to grant to those entities the authority to supple- ment the state system. Therefore, if the General Assembly decides to es- tablish local school entities, it may also empower them to enact local rev- enue initiatives to supplement the uniform, equal educational effort that the General Assembly must provide. ... Such local efforts may not be used by the General Assembly as a substitute for providing an adequate, equal and substantially uniform educational system throughout this state. (pp. 211-212)

Finally, Heise (1995) observed that adequacy litigation may be more ap- pealing to urban districts than equity litigation. Recall that equity litiga- tion, which seeks to equalize resources between rich and poor districts, might not be so appealing to urban districts because many receive more aid from the state than the state average. Therefore, these districts would not benefit from equity challenges. On the other hand, urban districts that are failing to provide a constitutionally adequate education might be enti- tled to even more resources to satisfy their constitutional duty.

Potential Weaknesses of Adequacy Approaches

Adequacy approaches do have several weaknesses that may limit the impact of third-wave litigation. The first weakness is that the concept of adequacy is extremely complicated. Although also complex, equity chal- lenges primarily require courts to inquire into a disparity of inputs. Ade- quacy claims not only demand "a prescription of some minimum inputs into schools, but also of outputs from schools" (Cover, 2002, p. 425). A fur- ther complication is that adequacy measures invite "measurements of many education sectors, including but not limited to teacher experience, class size, reading levels, and enrichment programs, in addition to state funding" (p. 425). "These different facets of education undergo an interde- pendent analysis. For example, the minimum adequate levels of a reading score (output) inform the requisite number of dollars to be spent (input)"

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(p. 425). This complexity might have caused the Rhode Island Supreme Court in City of Pawtucket v. Sundlun (1995) to refrain from ruling on the adequacy of the state's school finance system on separation of powers grounds. The court observed that there were no judicially enforceable stan- dard for measuring whether the state was providing an "efficient" edu- cation as required by the Constitution. It refused to create such standards because it found that the proper forum for this request was the state legis- lature, not the judiciary. Moreover, the court cited the New Jersey's Su- preme Court's struggle to define the components of an adequate education as a reason not to venture into this endeavor:

[T]he absence of justiciable standards could engage the court in a morass comparable to the decades-long struggle of the Supreme Court of New Jersey that has attempted to define what constitutes the "thorough and efficient" education specified in that state's constitution. ... Beginning with Robinson v. Cahill, ... the New Jersey Supreme Court has struggled in its self-appointed role as overseer for more than twenty-one years, consuming significant funds, fees, time, effort, and court attention. The volume of litigation and the extent of judicial oversight provides a chill- ing example of the thickets that can entrap a court that takes on the duties of a Legislature. (p. 59)

Scholars have questioned the claim that adequacy litigation is more pal- atable to rich districts because it is less likely to interfere with the doctrine of local control (Cover, 2002; Green & Baker, 2002; Patt, 1999). As Cover has observed: "Given a state's limited budget and resources, a judicial order that all districts must fund at a minimum level may often interfere with the state funding of wealthy districts. A state may need to raise the percentage of money it allots to poorer districts to achieve the adequate level. Hence, the percentage of that likely finite amount of state funding will diminish coffers of the wealthy district which are already well above the adequate floor. While the wealthy district may choose to increase its own local fund- ing, the adequacy mandate would infringe on the previously enjoyed local spending amount" (p. 426).

Moreover, legislatures might respond to judicial directives to provide an adequate education in a manner that fails to meet the educational needs of poor school districts (Richards, Baker, & Green, in press). Legislatures have responded to third-wave litigation by implementing cost-adjusted two-tier formulas. Such formulas consist of a first tier base aid component provided by the state to local districts (either in the form of a foundation aid type program or per-pupil block grant), adjusted to reflect varied costs across districts, and a second tier in which local districts are allowed to

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raise additional local taxes to supplement the first tier. Because of the polit- ical power of wealthy suburban districts, it is possible for "legislators representing wealthy school districts to more than offset the compensating effects of poverty adjustments that advantage poor districts by implement- ing [economies of scale] and geographic cost adjustments that advantage wealthier districts" (pp. 153-154). Further, if adequacy challenges based on state accountability standards are successful, legislatures might be tempted to "dumb down" these standards. As the discussion of the City of Pawtucket v. Sundlun (1995) case indicates, courts may hesitate to engage the legislature in a fight to satisfy their constitutional duty.

Other commentators have criticized adequacy approaches for failing to address the educational needs of urban school districts and poor, rural districts (Green, 2000; Roellke, in press; Ryan, 1999). Urban and poor rural districts tend to have much higher concentrations of low-income and low-performing students than their suburban counterparts. Consequently, children attending these schools are placed at a competitive disadvantage because such schools tend to have much lower test scores, higher dropout rates, fewer students in demanding classes, less well-prepared teachers, and a low percentage of students who will eventually attend college (Orfield & Eaton, 1996). Thus, it is should not be surprising that increases in resources have not always resulted in increases in educational perfor- mance (Ryan, 1999).

New Adequacy Approaches

In recent years, plaintiffs and school finance scholars have sought to ex- pand on the adequacy challenges brought about during the third wave. One approach has called for plaintiffs to use adequacy approaches to chal- lenge the effects of socioeconomic and racial isolation (Green, 2000; Ryan, 1999). In Sheff v. O'Neill (1996 [Sheff I]), the Connecticut Supreme Court ruled that the racial isolation of Hartford public school students violated the state's education and equal protection clauses by preventing the state from providing these students with a substantially equal educational op- portunity. The court rejected the claim that the plaintiffs were not entitled to relief because the disparities were not caused by state action. The court reached this conclusion because the state constitution imposed an affirma- tive duty to provide students with a substantially equal educational op- portunity. Thus, failure to take steps to remedy substantial educational in- equalities constituted state action. This constitutional obligation also included providing relief from de facto segregation. The state violated its duty by not taking sufficient action.

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However, the plaintiffs failed to obtain the level of integration that they had originally hoped. The legislature responded to Sheff I by authorizing school boards to adopt voluntary desegregation measures, including intradistrict and interdistrict public school choice programs, interdistrict magnet school programs, and charter schools. In Sheffv. O'Neill (1999 [Sheff II]), the plaintiffs alleged that the state had not acted fast enough in com- plying with the state supreme court's decision and that the state plan did not contain quotas and numerical goals. A state trial court rejected the plaintiffs' contentions, finding that voluntary measures were more appro- priate to remedy de facto segregation. Furthermore, the court was persuaded by evidence demonstrating that "voluntary plans are generally superior to mandatory ones because they promote integration of more last- ing duration with a minimum of opposition and disruption" (p. 942). In January 2003, the parties reached a settlement in which the state agreed to expand the Hartford region's magnet school and "open choice" programs. Plaintiffs acknowledged that the settlement fell short of their original goal of addressing the racial and socioeconomic segregation of Hartford's pub- lic schools (Enrich, 2003).

The failure of plaintiffs to achieve their goals should not be surprising in light of the doctrine of local control. School desegregation remedies call for even greater interference into the operation of school districts than school finance remedies. As Enrich (2003) observed: "School fund- ing cases, after all, ultimately only move dollars, and with relatively rare exceptions, they simply deliver additional dollars to poor districts, with- out depriving wealthier districts of the continuing ability to provide even more generous resources for themselves. Desegregation cases, however, actually threaten to change where and with whom our children go to school" (pp. 557-558).

The use of high-stakes tests-examinations that students must pass to obtain a high school diploma or be promoted to another grade-might make school finance formulas vulnerable to adequacy challenges under a federal substantive due process theory (Dyson, 2002; Welner, 2001). Sub- stantive due process requires legislation to be rationally related to a legiti- mate governmental interest. In Debra P. v. Turlington (1981), the Fifth Cir- cuit ruled that a high-stakes test would be "fundamentally unfair" and thus violate substantive due process if it failed to cover materials not taught in schools. The Debra P. case suggests that substantive due process challenges to high-stakes tests might be extended to challenge the "state's failure to fulfill its voluntarily assumed affirmative duty to provide each student with a fair opportunity to learn the material covered by the high-stakes exam" (Welner, 2001, p. 734). However, it is important to recog- nize that legislators might be tempted to lower the level of difficulty of

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these tests to the point where plaintiffs from poor school districts might be unable to establish educational harm.

Summary

Commentators have divided school finance litigation into three waves. In the first wave, plaintiffs argued that school finance inequities violated the equal protection clause of the federal constitution. This wave was ended by the Supreme Court's Rodriguez decision. Second-wave plaintiffs made equity challenges based on state equal protections clauses and edu- cation clauses. This wave failed, in part, because (a) many courts have been unwilling to apply strict scrutiny to school finance disparities, (b) the courts have accepted the local control doctrine as a reasonable defense for inequities, and (c) plaintiffs have failed to show that disparities in educa- tional funding have negatively affected the education provided by dis- tricts.

Third-wave litigation has departed from the previous two waves be- cause plaintiffs have argued that school finance formulas have failed to provide poor districts with an adequate education as guaranteed by edu- cation clauses. Third-wave plaintiffs experienced unprecedented success using this strategy. Principle reasons for this success are that (a) adequacy approaches enable plaintiffs to avoid the problems caused by the separa- tion of powers doctrine, (b) adequacy approaches are less vulnerable to lo- cal control concerns, and (c) adequacy challenges provide courts with a better opportunity to measure the sufficiency of the school finance system.

Further, we identified promising features of third-wave reform, such as a decline in judicial deference and a greater emphasis on substantive edu- cational requirements, services, and outputs (not just fiscal inputs). We also identified, however, several factors that may limit the ultimate success of the third wave: (a) the concept of adequacy is extremely complicated, (b) the outcome measures used by states to comply with judicial mandates may greatly constrict the local autonomy of wealthy districts, and (c) ade- quacy approaches may not adequately address the educational needs of urban districts.

Despite these limitations, the third wave of litigation's focus on ade- quacy and substantive judicial remedies is illustrative of the extensive progress of the school finance movement since its beginnings in the 1960s and 1970s. Preliminary evidence also suggests that this litigation, although a time-consuming and expensive approach to remedying inequity and in- adequacy, has generated considerable public, judicial, and legislative sup- port for education (Thompson & Crampton, 2002). The path to the current

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legal approach has taken many turns and met many roadblocks. In pursu- ing goals of equity and adequacy in education, the movement has adapted to and circumvented some of the arising challenges. Yet there is more to be done. A specific mandate in Campaignfor Fiscal Equity v. State (2003), for ex- ample, is to determine the "costs" of providing an adequate education. This provides another important indicator of the movement in school fi- nance to consider what configuration of resources is best suited to promot- ing student achievement.

School systems continue in their struggles to educate students, particu- larly low-income and minority children, in a way that is both equitable and adequate. The future of school finance litigation, although uncertain, will ideally rise to meet these continuing struggles and build on the promising foundations of recent litigation.

References

Abbott v. Burke, 693 A.2d 417 (N.J. 1997).

Baker, B., & Green, P. (2003). Can minority plaintiffs use the Department of Education imple- menting regulations to challenge school finance disparities? West's Education Law Reporter, 173, 679-696.

Board of Education, Levittown Union Free School District v. Nyquist, 439 N.E.2d 359 (N.Y. 1982).

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