West Orange-Cove Consolidated Independent School District v. Neeley

The State of Texas relies on local property taxes as the main source of funding for school districts. This structure lends itself to dramatic disparities in the ability of high- and low-wealth districts to raise the revenue necessary to educate their students. MALDEF’s initial statewide school finance case, Edgewood v. Kirby, filed in the 1980s on behalf of low-wealth districts and students attending those schools resulted in a seminal decision by the Texas Supreme Court in which the Court declared the gross inequities in the system unconstitutional. As part of the system put into place following MALDEF’s successful school finance litigation, the State created a new system that both recaptured a portion of excess revenue from high-wealth districts for re-distribution to low-wealth districts and imposed a tax cap of $1.50 per hundred dollars valuation to equalize school funding across districts in the state.

In the most recent state school finance case, West Orange-Cove C.I.S.D. v. Neeley, wealthy school districts challenged the state financing system arguing that the tax cap prevented them from meeting the accreditation standards imposed by the state and from exercising meaningful discretion in setting their tax rates, thus constituting an illegal state tax.

MALDEF represented 22 low-wealth school districts that intervened in the lawsuit to argue that the current system remains inequitable and inadequate but also to defend the continuing need for the equalization provisions. This was the first “adequacy” case tried in Texas. Although the Texas Supreme Court accepted MALDEF’s arguments in upholding the equalization provisions of the school finance system, the Court failed to find the system unconstitutionally inadequate or inequitable. The Court also agreed with the plaintiff districts that the school districts lacked meaningful discretion in setting their local taxes in violation of the Texas Constitution. The Texas Supreme Court stayed its injunction until June 1, 2006, and the Legislature passed a new school finance bill in May 2006 that put more money into the public school system.

In conjunction with its litigation efforts, MALDEF pursued policy solutions for the school finance system. In the special legislative session following the West Orange-Cove ruling by the Texas Supreme Court, the Texas Latino Education Coalition (TLEC), led by MALDEF and Intercultural Development Research Association (IDRA), released a 6-step plan for excellence to encourage the Texas Senate to draft legislation that would address the school finance crisis. MALDEF organized TLEC with other partners in the education community to focus specifically on critical educational issues in Texas and improve the state of education for Latino students in public schools. The six steps included keeping and improving equitable funding, substantially funding facilities construction, keeping and increasing funding to meet the cost of educating English language learners (ELLs) and economically disadvantaged students, funding a significant pay raise for all teachers, decoupling high-stakes testing from accountability systems, and giving public schools the resources to have a chance for success. Although the Legislature did not pass all of these proposals into law, MALDEF and education advocates were able to prevent legislation that did not retreat from the equity gained throughout the years of litigation and policy work. MALDEF has continued to advocate for these reforms in subsequent legislative sessions.