Michael K. Jeanes, Clerk of Court*** Electronically Filed ***02/16/2010 8:00 AM

SUPERIOR COURT OF ARIZONAMARICOPA COUNTYCV 2007-01798102/11/2010Docket Code 019

Form V000A

Page 1CLERK OF THE COURTHONORABLE DEAN M. FINKS. BrownDeputyGILBERT UNIFIED SCHOOL DISTRICT NO 41PAUL F ECKSTEINv.ARIZONA STATE, et al.KEVIN D RAYREBECCA K SETLOWCHAD BRADLEY SAMPSONMINUTE ENTRYEach party has submitted a motion for summary judgment; the state has also submitted amotion for judgment on the pleadings. All three motions cover essentially the same ground, andwill be discussed as one. The Court took these matters under advisement followingoralargument on October 19, 2009. Subsequently, the Court received, and has now considered:(1) Defendants’Notice of Supplemental Authority in Support of Defendants’ Motion forSummary Judgment, filed November 23, 2009, (2) Gilbert Unified School District No. 41’sResponse to Defendants’ Notice of Supplemental Authority, filed December 4, 2009, and (3)Defendants’ Reply to Gilbert Unified School District No. 41’s Response to Defendants’ Noticeof Supplemental Authority, filed December 14, 2009.The general question presented is whether a funding program effectively limited to 28 of the state’s school districts, and under which the 28 participating school districts annually receivefunds based on the formula utilized for all school districts –plus an additional 5.5.% –creates adeparture from the constitutional requirement of a general and uniform public school system.For the motion for judgment on the pleadings, all well-pled facts in the Complaint are tobe taken as true; in any event,the material facts do not appear to be in dispute. In 1985, the

SUPERIOR COURT OF ARIZONAMARICOPA COUNTYCV 2007-01798102/11/2010Docket Code 019

Form V000A

Page 2Career Ladder Program was created by the legislature as a five-year pilot program to improve thequality of teaching and thus of education in participating districts. In the early years, the numberof districts allowed to participate grew, in increments of seven, from the original seven to 28;however, since 1994 no new districts have been allowed to participate. Plaintiff Gilbert UnifiedSchool District (the “District”) argues that the effect of the Career Ladder Program has been toallow participating districts to outbid non-participating districts for the best teachers, resulting inan impermissible disparity between the two classes of districts.Turning first to the State’s procedural objections, counsel for the State did not address theapplicability of laches at oral argument. Laches is the equitable counterpart of a statute of limitations, and is to be invoked when “under the totality of circumstances, the claim, by reasonof delay in prosecution, would produce an unjust result.”

Harris v. Purcell

, 193 Ariz. 409, 410 ¶1 n.2 (1998). Such a finding requires that the adverse party suffer actual prejudice from thedelay.

Id.

at 412 ¶ 16. The State has suffered no prejudice; even assuming that the interests of the participating districts, non-parties to this action, are to be considered, they would not beprejudiced by losing a flow of funds to which they were not entitled in the first place, and theDistrict does not seek retrospective relief requiring them to disgorge funds already spent.Furthermore, the assumption that a decision in the District’s favor will result in the “destruction”of the Career Ladder program and the impoverishment of the teachers in the participatingdistricts is not necessarily a sound one, and depends on the remedy selected by the legislature,not the decision of this Court.The statute of limitations defense also fails. The State is correct that the District iscovered by A.R.S. § 12-821. School districts are included within the scope of A.R.S. § 12-510,which excludes political subdivisions from certain statutes of limitations.

Tucson Unified School Dist. v. Owens-Corning Fiberglas Corp.

, 174 Ariz. 336, 337-38 (1993). However, the latterstatute applies only to statutes of limitations codified in Chapter 5 of Title 12, not to A.R.S. § 12-821, which is found in Chapter 7. The common-law exemption of political entities from statutesof limitations cannot stand against the express statutory language.That said, the District’s action is not time-barred. Entry into the Career Ladder programhas never been formally closed. 1992 Ariz. Sess. Laws Ch. 246 § 3 expressly authorized theDepartment of Education to approve new districts for the program, providedthat the legislatureapproved new funding. If the legislature’s implicit promise to fund the program is treated asgenuine, as the Court does not doubt, there is no reason to treat the District’s claim as accruing in1994 or in any other year prior to the most recent application and rejection. At no time was theDistrict informed that it had to apply or be forever excluded, and while, with the passage of theyears, the promise of new money has rung more and more hollow, there was no day prior to itsapplication when it could be said that participation in the Career Ladder program was denied toit. (This distinguishes the present action from

Mayer Unified School Dist. v. Winkleman

, 219

SUPERIOR COURT OF ARIZONAMARICOPA COUNTYCV 2007-01798102/11/2010Docket Code 019

Form V000A

Page 3Ariz. 562 (2009), in which there was a single discrete act that could be identified as defining theplaintiff’s rights for all time.)Turning next to the uniformity arguments, there is of course no dispute that the CareerLadder program constitutes an infusion of state money into the coffers of 28 districts to theexclusion of the remainder. The State argues that the general and uniform clause requires onlythat the public schools be funded so as to achieve a statewide level of minimum adequacy andprevent substantial disparities between districts; because the District cannot show that its failureto receive the state funding received by the participating districts has resulted in its failure toreach the level of minimum adequacy or the creation of a substantial disparity between it and theparticipating districts, its suit fails.On an evidentiary level, the Court does not see in the record any evidence controvertingthe District’s affidavits that such a disparity exists. At the broader constitutional level, this casedoes not raise the same questions addressed in the

Roosevelt

and

Albrecht

opinions. Those casesdealt with the effect of the uniformity clause on the provision of education given the inequalityof property valuation, and thus property tax revenues, from district to district. The SupremeCourt held that “the system the legislature chooses to fund the public schools must not itself bethe cause of substantial disparities.”

Roosevelt Elem. Sch. Dist. v. Bishop (Roosevelt I)

, 179Ariz. 233, 242 (1994) (plurality opinion);

id.

at 246 (Feldman, C.J., specially concurring). It is,of course, not suggested that the state is responsible for the disparity in property tax revenue,which, as the Supreme Court acknowledged, isthe product of housing patterns and the freemarket economy.

Id.

at 242. Thus, the SupremeCourt had no occasion to address the non-uniformity found here, non-uniformity in the familiar dictionary sense of unequal state funding.It did, however, provide direction for a case like this one. “[N]othing in the constitutionprohibits a school financing system that allows districts to go above and beyond state-mandatedadequate facilities by individually accessing local financing sources…. But the general anduniform requirement will not tolerate a state funding mechanism that itself causes disparitiesbetween districts.”

Hull v. Albrecht (Albrecht II)

, 192 Ariz. 34, 37-38 (1998). Not only

substantial

disparities, but

all

disparities violate the uniformity clause if they are caused by thestate itself.That there are disparities is evident. Thepurpose of the Career Ladder program is toattract, through the offer of higher salaries, better-trained teachers, whose expertise in teachingmethods will presumably increase students’ learning as compared to students with lower-paid,less expert teachers. Having continued it for so many years, the legislature has plainly concludedthat the Career Ladder has achieved its goal. This, of course, is precisely the District’s point: theProgram creates, and exists to create, a difference in educational quality between participatingand non-participating districts. That this difference may be difficult to quantify does not place itbeyond judicial review. The difference in funding levels –$68,000,000 in the 2005-06 school