Vouchers unconstitutional; state must retrieve distributed funds

by Sharon McCloskey and Lindsay Wagner, NC Policy Watch, August 21, 2014.

In a stunning rebuke to state lawmakers’ efforts to bring school vouchers to North Carolina, Wake County Superior Court Judge Robert Hobgood today found the recently-enacted “Opportunity Scholarship Program” unconstitutional and permanently enjoined disbursement of state funds for that purpose.

“The General Assembly fails the children of North Carolina when they are sent with public taxpayer money to private schools that have no legal obligation to teach them anything,” Hobgood said.

In his ruling, issued this morning from the bench, the judge broke down the program and detailed the many reasons why it failed constitutional muster:

This legislation unconstitutionally

1) appropriates to private schools grades K-12, by use of funds which apparently have gone to the university system budget but which should be used exclusively for establishing and maintaining the uniform system of free public schools;

2) appropriates education funds in a manner that does not accomplish a public purpose;

3) appropriates educational funds outside the supervision and administration of the state board of education;

4) creates a non-uniform system of education;

5) appropriates taxpayer funds to educational institutions that have no standards, curriculum and requirements for teachers and principals to be certified;

6) fails to guard and maintain the rights of the people who privilege the education by siphoning money from the public schools in favor of private schools; and

7) allows funding of non-public schools that discriminate on account of religion.

Hobgood also refused to stay his decision pending an appeal by the state, which is likely to follow soon.

How we got here

State lawmakers passed a 2013 budget that tagged $10 million to be used for the “Opportunity Scholarships” beginning this fall. The vouchers, worth $4,200 per student annually, funnel taxpayer funds to largely unaccountable private schools–70 percent of which are affiliated with religious institutions.

The voucher program was put on hold last February, when Judge Hobgood issued a preliminary injunction in lawsuits brought by the North Carolina Association of Educators, the N.C. School Boards Association and the North Carolina Justice Center, who challenged the constitutionality of the program.

In late March, Speaker Thom Tillis and Senate leader Phil Berger pressured the state’s Attorney General Roy Cooper to appeal Judge Hobgood’s order to temporarily halt the program – but Cooper’s office declined the lawmakers’ request.

Parents who intervened in the case, represented by the Koch Brothers-backed law firm Institute for Justice, did move forward with an appeal of Hobgood’s order, contending that they would be harmed by the court’s delay of the voucher program’s implementation.

In May, the state Supreme Court overturned Judge Hobgood’s injunction, allowing the school voucher program to move forward.

“Follow the money”

In his ruling today Hobgood recognized the state’s obligation to provide a “sound basic education” to the children attending public schools in North Carolina as mandated by the Supreme Court in its Leandro decision .

“The General Assembly cannot constitutionally delegate this responsibility to unregulated private schools by use of taxpayer opportunity scholarships to low income parents who have self-assessed their children to be at risk,” he said.

Hobgood noted that the private schools receiving the scholarships are not subject to any requirements or standards regarding the curriculum that they teach, have no requirements for student achievement, are not obligated to demonstrate any growth in student performance and are not even obligated to provide a minimum amount of instructional time.

The collateral effect of the program, he added — whether intended or not — is to remove the Leandro protections from the hundreds of students who have been determined “at-risk” solely by their own parents.

“It appears to this court that the General Assembly is seeking to push at-risk students from low income families into non-public schools in order to avoid the cost of providing them a sound basic education in public school as mandated by the Leandro decision,” he said.

The judge also made clear that he was not buying lawmakers’ argument that state funds were not funding the program.

This summer, Rep. Paul “Skip” Stam pushed through an amendment to the voucher law that pulled $10 million out of the state’s General Fund to pay for the program. That budgetary maneuver allowed Stam to then readjust the public school budget back to what it would have been had school vouchers never existed.

As amended the voucher law stated that “scholarship grant funds awarded . . . to eligible students attending a non-public school shall not be considered funding from the state of North Carolina.”

Nowhere in the state’s General Statutes is there any provision for scholarship grants to come from any source other than taxpayer funds, Hobgood noted.

“If scholarship grants shall not be considered funding from the state of North Carolina, this court is at a complete loss to understand the source of those funds,” he said.

“Follow the money,” the judge added. “The clear legislative intent is to utilize taxpayer money to fund private schools.”

Now what?

Money for school vouchers was originally scheduled for disbursement to private schools on September 15, but that date was moved up to allow funds to go out the door prior to today’s hearing.

Earlier in August, attorneys for the parties challenging the program tried to block that early disbursement.

“If funds are distributed to parents and schools to support a program that is going to be declared unconstitutional in late August, then the state is put in the position of having to retrieve that money from hundreds of schools, and parents who are relying on these vouchers are going to find that the voucher is worthless,” attorney Burton Craige told the court.

“So this disrupts parents, children, schools, and the state in its use of taxpayer funds.”

But Hobgood denied the request to block an early disbursement.

Following the court’s ruling today, attorney Lauren Clemmons, who is defending the state in the case, told Judge Hobgood that an unspecified amount of voucher money had already been disbursed.

“There is currently . . . money going through an electronic system right now that we can’t stop,” Clemmons said. “So how do you want to address that?”

“That would have to be addressed by the Attorney General to recover the money,” Hobgood answered.

http://www.ncpolicywatch.com/2014/08/21/nc-school-vouchers-ruled-unconstitutional-state-must-retrieve-distributed-funds/