Hobbs set to flip state's stance on school maintenance funding

PHOENIX — Arizona Governor-elect Katie Hobbs appears ready to side with school districts in their legal fight with the state and legislative leaders over whether they were illegally denied money for years they need to maintain classrooms and build new schools.

And that could affect the outcome of a trial set to begin next month — and the more than $6 billion school districts across the state say they have been shorted so far.

Until now, the School Facilities Board has been defending the failure in many years of the state to live up to its legal commitment to provide the dollars that state law says are due schools. Their attorneys argue, among other things, that decisions on funding are political issues beyond the reach of the courts.

But come January the board, a branch of the state Department of Administration, will be reporting not to Doug Ducey but Hobbs. And attorneys involved in the lawsuit told Maricopa County Superior Court Judge Dewain Fox that Hobbs now wants to reevaluate and direct the position that has been taken for the last five years by the executive branch.

Funding dispute dynamics to change

Hobbs taking a contrary position to Ducey should come as no surprise, Murphy Hebert told Capitol Media Services about her boss.

Hebert said Hobbs, who was a state legislator for eight years — including in 2017 when the districts and education groups sued — believes the state has been short-changing schools.

Any move by Hobbs to have the board and its state-paid attorney stop defending the alleged underfunding, however, does not mean an automatic ruling in favor of the challengers and a court order for more money.

House Speaker Rusty Bowers, R-Mesa, and Senate President Karen Fann, R-Prescott, have obtained their own lawyers. And Judge Fox said he won’t delay the trial after the attorneys for the legislative leaders told him that they are prepared to “carry the water” if the new governor won’t defend as constitutionally adequate the funds that have been provided.

But having the School Facilities Board on the same legal side as the school districts that sued it in the first place would change the dynamics of the case.

And it could improve their chances of getting a ruling in their favor — and the money school districts say they’re owed.

Some school facilities lacking

The fight actually dates back to 1994.

Prior to then, construction of new schools and needed repairs were presumed to be solely the responsibility of local districts.

But a historic ruling that year by the Arizona Supreme Court said that created gross inequities — and left some schools without adequate facilities.

“Some districts have schoolhouses that are unsafe, unhealthy, and in violation of building, fire and safety codes,” the justices said, noting there are schools without libraries, laboratories or gymnasiums. “But in other districts, there are schools with indoor swimming pools, a domed stadium, science laboratories, television studios, well-stocked libraries, satellite dishes and extensive computer systems.”

And, that, they said, runs afoul of that constitutional obligation for a general and uniform school system.

Funding for upkeep shorted

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Lawmakers eventually created the School Facilities Board to come up with minimum guidelines and to create a system to both finance new schools as needed as well as provide $200 million a year for routine upkeep.

However, here have been years where lawmakers, seeking to save money, did not fully fund that formula. Instead they adopted a year-by-year approach of having districts seek funds.

The result, according to challengers, has been a shortage of dollars to pay not only for repairs but for other needs ranging from school buses to textbooks. The accumulated total, they say, now exceeds $6 billion.

And that, they said, forces school districts to use locally raised funds — assuming voters are willing to go along — to pay for needs the Supreme Court concluded are a state responsibility.

Hobbs called out lawmakers during her campaign.

Routine repairs could save money

“Republicans abandoned the state’s obligation to provide an equal education to every child in this state by ceasing to fund the maintenance and repair of our schools,” she said in her position paper on education. “As a result educators have been teaching in classrooms with leaking roofs, broken lights and faulty air conditioning.”

And she said the 2017 lawsuit was inevitable as schools were “left with no choice.”

Hobbs said this is about more than just immediate dollars. She said that expediting repairs will, in the long term, lower costs.

That’s also the assessment of Chuck Essigs, lobbyist for the Arizona Association of Business Officials.

He said lawmakers, rather than fully funding the formula for schools to do routine maintenance, have instead turned to a system where schools can seek grants to fix problems. What that means, he said, is having to wait until the roof actually is leaking to petition for financial help rather than having the money to have kept up with the problem.

Districts’ property wealth varies

The amount of dollars that schools are being allocated is based on what the School Facilities Board has decided is the minimum necessary. But Essigs said that has not been updated to consider what is now necessary, ranging from computers to security.

And then there’s that $6 billion schools said they should have received in prior years for repairs and other capital needs, forcing them to divert resources to address the needs, simply allow them to persist — or force school districts to use locally raised funds.

That only adds to the disparities the high court found illegal, said Josh Bendor, one of the attorneys representing the schools.

He said some districts have more property wealth than others. That means adding $1 to the local property tax in a rich district raises far more than the same levy in a property-poor district.

Put another way, Bendor said, people in poor districts have to raise their tax rates by three or four times as much as those in rich districts to raise the same amount of money.