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Gannon v. State

Supreme Court of Kansas

October 2, 2017

Luke Gannon, by His Next Friends and Guardians, et al., Appellees,
v.
State of Kansas, Appellant.

         SYLLABUS

         1. A party asserting compliance with a court decision ordering remedial action bears the burden of establishing such compliance.

         2. To determine legislative compliance with the adequacy requirement in Article 6 of the Kansas Constitution, Kansas courts apply the test from Rose v. Council for Better Educ., Inc., 790 S.W.2d 186 (Ky. 1989), which establishes minimum standards for providing adequate education. More specifically, the adequacy requirement is met when the public education financing system provided by the legislature for grades K-12- through structure and implementation-is reasonably calculated to have all Kansas public education students meet or exceed the standards set out in Rose and presently codified in K.S.A. 2016 Supp. 72-1127.

         3. Under the facts of this case, the State has not met its burden of establishing that the K-12 public education financing system the legislature enacted, i.e., Senate Bill 19, is reasonably calculated to have all Kansas public education students meet or exceed the standards set out in Rose v. Council for Better Educ., Inc., 790 S.W.2d 186 (Ky. 1989).

         4. To determine compliance with the equity requirement in Article 6 of the Kansas Constitution, school districts must have reasonably equal access to substantially similar educational opportunity through similar tax effort. This is not a zero-tolerance test because equity is not necessarily the equivalent of equality.

         5. Under the facts of this case, the State has not met its burden of establishing that school districts have reasonably equal access to substantially similar educational opportunity through similar tax effort after Senate Bill 19 expanded the authorized uses of the capital outlay fund.

         6. Under the facts of this case, the State has not met its burden of establishing that school districts have reasonably equal access to substantially similar educational opportunity through similar tax effort by imposing different procedures for certain districts to raise their maximum Local Option Budget (LOB).

         7. Under the facts of this case, the State has not met its burden of establishing that school districts have reasonably equal access to substantially similar educational opportunity through similar tax effort after Senate Bill 19 changed the LOB equalization calculation.

         8. Under the facts of this case, the State has not met its burden of establishing that school districts have reasonably equal access to substantially similar educational opportunity through the at-risk funding procedures in Senate Bill 19.

         Appeal from Shawnee District Court; Franklin R. Theis, Robert J. Fleming, and Jack L. Burr, judges. The State has failed to show that the remedial legislation, Senate Bill 19, meets the adequacy and equity requirements of Article 6 of the Kansas Constitution.

          Stephen R. McAllister, solicitor general, argued the cause, and Jeffrey A. Chanay, chief deputy attorney general, M.J. Willoughby, assistant attorney general, Dwight R. Carswell, assistant solicitor general, Bryan C. Clark, assistant solicitor general, and Derek Schmidt, attorney general, were with him on the briefs for appellant State of Kansas; Arthur S. Chalmers and Jerry D. Hawkins, of Hite, Fanning & Honeyman, LLP, of Wichita, were with him on the briefs for appellant State of Kansas; and Jeffrey R. King, special assistant attorney general, argued the cause for appellant State of Kansas.

          Alan L. Rupe, of Lewis Brisbois Bisgaard & Smith LLP, of Wichita, argued the cause, and Jessica L. Skladzien, of the same firm, and John S. Robb, of Somers, Robb & Robb, of Newton, were with him on the briefs for appellees.

          Jeffrey R. King, of Collins & Jones, P.C., of Overland Park, was on the brief for amicus curiae Legislative Coordinating Council.

          PER CURIAM.

         This is the fifth school finance decision involving these parties and Article 6 of the Kansas Constitution, which imposes a duty on the legislature to "make suitable provision for finance of the educational interests of the state." Kan. Const. art. 6, § 6(b). The plaintiffs filed suit in 2010 asserting that the State violated this constitutional requirement by inequitable and inadequate funding of K-12 public education. A three-judge panel determined in 2013 after a trial that through K.S.A. 72-6405 et seq. (School District Finance and Quality Performance Act or SDFQPA) the State had inequitably and inadequately funded education for years in violation of Article 6.

         A series of other panel decisions, legislative enactments, and four decisions by this court followed. In the latest of those decisions, filed in March of this year, we held that the 2015 legislative replacement for a by-then-repealed SDFQPA-the Classroom Learning Assuring Student Success Act (CLASS)-was constitutionally inadequate in both structure and implementation. Evidence showed that not only was the State failing to provide approximately one-fourth of all its public school K-12 students with the basic skills of both reading and math, but that it was also leaving behind significant groups of harder-to-educate students. And substantial competent evidence showed that the student performance reflected in this evidence was related to funding levels. We stayed the issuance of our mandate to provide the legislature an opportunity to bring the state's education financing system into compliance with Article 6 of the Kansas Constitution, cautioning that any remedy should also comport with equity. Gannon v. State, 305 Kan. 850, 855-56, 390 P.3d 461 (2017) (Gannon IV). The legislature responded by passing Senate Bill 19.

         We now face the following question: Based upon the issues the parties brought before us, has the State met its burden of showing that this remedial legislation meets Article 6's adequacy and equity requirements? We hold the State has not. Even though S.B. 19 arguably makes positive strides, the state's public education financing system still has not been shown by the State to be "reasonably calculated to have all Kansas public education students meet or exceed the standards set out in Rose [v. Council for Better Educ., Inc., 790 S.W.2d 186 (Ky. 1989)] and presently codified in K.S.A. 201[6] Supp. 72-1127." Gannon v. State, 298 Kan. 1107, 1170, 319 P.3d 1196 (2014) (Gannon I) (articulating the test for adequacy). Additionally, that system, through its structure and implementation, is not providing school districts with "reasonably equal access to substantially similar educational opportunity through similar tax effort." 298 Kan. at 1175 (articulating the test for equity).

         Given these conclusions, we next consider remedy. As we acknowledged in Gannon IV, "Our general practice with previous school finance decisions has been to retain jurisdiction and continue to stay . . . our own mandate to provide the legislature an opportunity to bring the state's education financing system into compliance with Article 6 of the Kansas Constitution. [Citations omitted.]" 305 Kan. at 856. We essentially continue that practice today for the same reasons cited in Gannon IV, i.e., because the State has twice demonstrated its ability to cure constitutional infirmities recognized by this court in the school finance system. 305 Kan. at 856; see Montoy v. State, 282 Kan. 9, 24-25, 138 P.3d 755 (2006) (Montoy IV) (legislature's efforts in 2005 and 2006 constitute substantial compliance with prior orders; appeal dismissed); Gannon v. State, No. 113, 267 (order dated June 28, 2016) (unpublished) (finding legislation cured equity constitutional infirmities in Gannon litigation for the 2016-2017 school year).

         Once legislation is enacted, the State will have to satisfactorily demonstrate to this court by June 30, 2018, that its proposed remedy brings the state's education financing system into compliance with Article 6 of the Kansas Constitution regarding the violations identified, i.e., both adequacy and equity. For those purposes, the State will continue to bear the burden of establishing such compliance and explaining its rationales for the choices made to achieve it. 305 Kan. at 856 (citing Gannon v. State, 303 Kan. 682, 709, 368 P.3d 1024');">368 P.3d 1024 [2016] [Gannon II], which held that the party asserting compliance with a court decision ordering remedial action bears the burden of establishing that compliance).

         Staying the issuance of our mandate until June 30 is consistent with our general practice. But we also "must heed our duty to ensure Kansas students receive the education system guaranteed them by the Constitution." Gannon II, 303 Kan. at 744. Without counting today's decision, the education financing system has been judicially declared to be inadequately funded for at least 12 of the last 15 years-through school year 2016-2017. So after June 30, 2018, "'the demands of the Constitution cannot be further postponed.'" 303 Kan. at 744 (quoting Edgewood Independent School Dist. v. Kirby, 804 S.W.2d 491, 498 [Tex. 1991]). We agree with the Wyoming Supreme Court: "'[S]taying the judicial hand in the face of continued violation of constitutional rights makes the courts vulnerable to becoming complicit actors in the deprivation of those rights.'" 303 Kan. at 739 (quoting State v. Campbell County School Dist., 2001 WY 90, ¶ 33, 32 P.3d 325');">32 P.3d 325 [2001]).

         The State will have ample time and opportunity, whether by regular legislative session, special session, or a combination thereof, to bring the system into constitutional compliance so that we can make such a judgment-by that date.

         Historical perspective

         The parties agree that the framework of S.B. 19 is essentially based on the SDFQPA that existed for approximately 23 years. Accordingly, it is helpful to revisit the history set forth in Gannon IV, 305 Kan. at 876-80, and supplement it with later developments.

         U.S.D. No. 229

         Since 1992, the SDFQPA had established the formula and mechanism through which most funds for K-12 public education were obtained by Kansas school districts. See U.S.D. No. 229 v. State, 256 Kan. 232, 275, 885 P.2d 1170 (1994) (upholding the constitutionality of SDFQPA as originally enacted and implemented). The formula provided a fixed amount of funding for each student through "base state aid per pupil, " also known as BSAPP. A district's full-time equivalent enrollment was adjusted by adding various weightings based on the proven recognition that the needs of some students require more resources for their education than others. These included such things as low enrollment, special education, vocational, bilingual education, and at-risk student weighting factors, which added funds for those needs. Once a school district's enrollment was adjusted per the weightings, that figure was multiplied by the BSAPP. The resulting product was the amount of state financial aid to which the school district was entitled.

         Funding for the BSAPP was derived from two sources: local effort and state financial aid. The majority of school districts' local effort consisted of property tax funds, as each district was statutorily required to impose a mill levy-20 mills per K.S.A. 2016 Supp. 72-6470-upon taxable tangible property in its territory. Because property values vary widely throughout the state, the amount of money each district could raise by the required mill levy also varied widely. So the State provided additional funds to less wealthy districts through "general state aid."

         If a district's local effort funds equaled its state financial aid entitlements, it received no additional money from the State, i.e., general state aid. And if a district's local effort funds exceeded its state financial aid entitlement, the excess was remitted to the State. For those districts qualifying for general state aid, their amount was what remained after subtracting their local effort funds from their state financial aid entitlement.

         Local effort and state financial aid-as calculated using BSAPP and enrollments-comprised most of the funds available for K-12 education. But school districts could access additional funds in several ways.

         First, a local school board could impose an additional mill levy on property in its district to fund a local option budget (LOB) to augment the funds that were distributed through the BSAPP. The revenues produced by the LOB mill levy could not exceed an amount equal to a set percentage or "cap"-historically as low as 25%-of a district's state financial aid. K.S.A. 72-6433(b)(9)(B). After application of a statutory formula, in order to account for differences in property wealth among the districts, the less wealthy ones could also qualify for, and receive from the State, "supplemental general state aid."

         Second, a local board could also impose an additional mill levy on property in its district to fund capital outlay expenses such as purchasing certain equipment. After application of a statutory formula, the less wealthy districts could also qualify for, and receive from the State, "school district capital outlay state aid."

         In U.S.D. No. 229, both the trial court and this court scrutinized the various components of the SDFQPA, described by this court as "arguably, the most significant single piece of legislation ever enacted by the Kansas Legislature in terms of the amount of tax dollars involved and its impact on the citizens of Kansas." 256 Kan. at 236. This court concluded that the legislative record demonstrated a justification for each component of the SDFQPA. 256 Kan. at 266-68.

         Montoy

         The structure of the SDFQPA as originally challenged by the Gannon plaintiffs had been modified in response to our holdings arising from litigation in Montoy v. State. These are: Montoy v. State, 275 Kan. 145, 62 P.3d 228 (2003) (Montoy I); Montoy v. State, 278 Kan. 769, 120 P.3d 306 (2005) (Montoy II); Montoy v. State, 279 Kan. 817, 112 P.3d 923 (2005) (Montoy III); and Montoy IV, 282 Kan. 9.

         This litigation acknowledged that the BSAPP when the SDFQPA was first implemented in 1992 was $3, 600. Montoy III, 279 Kan. at 830. The State gradually increased BSAPP through small yearly increments until it reached $3, 890 in 2002. At that time, the legislature had the results of a cost study it had commissioned by Augenblick and Myers (A & M), which proposed the state implement a BSAPP of $4, 650 for 2001. 279 Kan. at 830. After our decision in Montoy II, the 2005 legislature responded by increasing BSAPP from $3, 890 to $4, 222 through a $63.3 million increase in state funding. 279 Kan. at 830.

         We found this response to be inadequate. Montoy III, 279 Kan. at 845-46. During a special session called later that same month, the legislature timely amended the formula and provided a funding increase totaling $289 million for the 2005-2006 school year. See Montoy IV, 282 Kan. at 14. This amount represented one-third of the amount proposed by the A & M study, which had been previously disregarded by the State. But, as we later explained in Gannon I, full funding of this study's recommended amount was not necessarily required for constitutional compliance. 298 Kan. at 1170. In an unpublished order of July 8, this court held those amendments complied with Montoy III for "interim purposes" but retained jurisdiction to view any additional legislation passed by the 2006 legislature. Montoy IV, 282 Kan. at 15.

         While Montoy was pending, the legislature not only had the results of the A & M study but it also directed the Legislative Division of Post Audit (LPA) to "conduct a professional cost study analysis to estimate the costs of providing programs and services required by law." K.S.A. 2005 Supp. 46-1131(a). The applicable law included "(1) State statute; and (2) rules and regulations or standards relating to student performance outcomes adopted by the state board" of education. K.S.A. 2005 Supp. 46-1131(b). These statutes included K.S.A. 2005 Supp. 72-1127, which required the State Board of Education (SBE) to design performance outcome standards to achieve the educational goals newly established by the 2005 legislature in subsection (c). In Gannon I, we later described the goals in 72-1127 as "remarkably parallel[]" to the Rose standards. 298 Kan. at 1166-67.

         In response to our Montoy III decision as well as the results of the LPA study, in 2006 the State increased education funding by $466.2 million to be stretched over the upcoming three years, which, when combined with the previous increases, would total $755.6 million. This funding increase included raising the BSAPP for fiscal year 2007 from $4, 257 to $4, 316; to $4, 374 for fiscal year 2008; and up to $4, 433 for fiscal year 2009. Montoy IV, 282 Kan. at 17-18.

         Given these statutory provisions, we held that the new funding system constituted substantial compliance with our prior orders, so we dismissed the Montoy litigation. In relinquishing jurisdiction, we recognized that because the State's new funding provisions constituted a three-year plan it "may take some time before the full financial impact of the new legislation [was] known, a factor which would be important in any consideration of whether it provide[d] constitutionally suitable funding." Montoy IV, 282 Kan. at 26.

         Less than three years after Montoy was dismissed, the State began making significant cuts to Kansas' education funding, initially in response to the national economic downturn. In fiscal year 2009 the BSAPP appropriation was reduced from the 2006 legislature's statutorily specified amount of $4, 443 to $4, 400. And although the 2009 legislature had initially established BSAPP at $4, 492 for fiscal year 2010 and beyond, the actual appropriation for fiscal year 2010 was reduced to $4, 012-a difference of $480 per pupil.

         After Gannon was filed in November 2010, legislative reductions in BSAPP-calculated spending continued. By fiscal year 2012-that began July 1, 2011, and ended June 30, 2012-the legislature had reduced BSAPP to $3, 780. In total, the reduction to education funding through these BSAPP reductions constituted a loss of more than $511 million to local districts. Gannon I, 298 Kan. at 1114-15. Based upon this and other evidence, the panel concluded in its January 2013 decision that the legislature underfunded K-12 public education between fiscal years 2009 and 2012. 298 Kan. at 1110. It also concluded the State had violated the equity requirement by eliminating capital outlay state aid and prorating supplemental general state aid payments to which some less-wealthy school districts were otherwise entitled by statute. 298 Kan. at 1181, 1188.

         In Gannon I, we affirmed the panel on equity and remanded for it to make determinations in the remedial phase. 298 Kan. at 1111. After its decisions, we resolved the equity issue through a series of decisions and orders followed by a special session of the legislature in June 2016 that produced additional school finance legislation and appropriations. We ultimately held that for the 2016-2017 school year, the legislative response cured the constitutional inequities identified in our previous decisions. Gannon, No. 113, 267 (order dated June 28, 2016) (unpublished).

         In Gannon I we also tasked the panel on remand with making an adequacy determination after applying our more clearly defined Rose-based test to the facts. 298 Kan. at 1171. The panel issued several rulings which, combined with its earlier decision, declared that the financing under the SDFQPA from fiscal year 2009 through fiscal year 2015was constitutionally inadequate under the Gannon I test. Soon thereafter the 2015 legislature enacted CLASS, which repealed and replaced the SDFQPA. CLASS essentially froze funding levels for fiscal years 2016 and 2017 at the fiscal year 2015 level until that law expired on June 30, 2017. The panel later declared CLASS unconstitutional for substantially the same reasons it earlier had declared the SDFQPA unconstitutional. Gannon IV, 305 Kan. at 854.

         On March 2, 2017, in Gannon IV, we affirmed the panel's holding that CLASS was constitutionally inadequate. CLASS did not meet the structure or implementation requirement contained in the Gannon I test. 305 Kan. at 855. En route to that conclusion we specifically affirmed that for the two years CLASS was in existence-fiscal year 2016and fiscal year 2017-the funding was inadequate and that substantial numbers of Kansas students were performing below their grade level:

"[A]t a minimum, the results on various standardized tests reveal that an achievement gap, or proficiency gap, found by the panel to exist between 'all students' and certain subgroups persists as of school year 2015-2016. And the numbers of all students failing to reach proficiency in core subjects each year continue to be significant." Gannon IV, 305 Kan. at 913.

         We further agreed with the panel that more money was needed. 305 Kan. at 913-14.

         In response, three and a half months later in June 2017 the legislature enacted and the governor signed S.B. 19. See L. 2017, ch. 95.

         S.B. 19

         S.B. 19 includes appropriations, several revenue raising features, and a formula for distributing money. It also contains laws impacting education policy.

         The centerpiece of S.B. 19 is the new Kansas School Equity and Enhancement Act (KSEEA), which establishes the formula through which most K-12 public education funds are obtained by Kansas school districts. L. 2017, ch. 95, §§ 3-48. But S.B. 19 also amends certain statutes, including the capital outlay provisions, K.S.A. 72-8801 et seq.; the Virtual School Act, K.S.A. 2016 Supp. 72-3711 et seq.; the Special Education for Exceptional Children Act, K.S.A. 72-961 et seq.; and the Tax Credit for Low Income Students Scholarship Program Act, K.S.A. 2016 Supp. 72-99a01 et seq. The issues on appeal mainly involve the KSEEA and capital outlay laws.

         The KSEEA contains the same basic finance formula and revenue streams as the SDFQPA immediately prior to its repeal-although some terminology is different. It utilizes a funding system in which some of the money used to fund basic operating expenses comes from the "total foundation aid" calculation, i.e., the formula, and some monies come from the LOB. L. 2017, ch. 95, §§ 4, 15.

         Total foundation aid-known as state financial aid under the SDFQPA-is determined by a formula which provides a fixed amount of funding per student. Called the "'Base aid for student excellence'" or "'BASE aid'" under S.B. 19, it was known as base state aid per pupil, or BSAPP, under the SDFQPA. L. 2017, ch. 95, § 4(e). Total foundation aid equals the BASE multiplied by the district's enrollment as adjusted by the same weightings used under the SDFQPA to reflect that some students require more resources or that some districts have factors that increase costs. L. 2017, ch. 95, § 4(jj). Compare L. 2017, ch. 95, § 4(a) with K.S.A. 2014 Supp. 72-6407(f). The KSEEA also imposes the same mandatory 20-mill levy on each district's taxable tangible property. Compare L. 2017, ch. 95, § 14 with K.S.A. 2014 Supp. 72-6431. But all 20 mills are remitted to the State. L. 2017, ch. 95, § 14(c).

         The BASE for school year 2017-2018 is $4, 006 and for school year 2018-2019 is $4, 128. Each year thereafter, the BASE is adjusted for inflation. L. 2017, ch. 95, § 4(e). The Kansas State Department of Education (KSDE) estimates the inflation adjustment will add $62 to the BASE in 2019-2020, raising it to $4, 190.

         As with the SDFQPA, school districts can still impose an additional mill levy on district property to fund an LOB. Compare L. 2017, ch. 95, § 15 with K.S.A. 2014 Supp. 72-6433. But the state prescribed percentage-the statutory cap on the revenues it produces-is set at 33% of the school district's total foundation aid. L. 2017, ch. 95, § 15(k)(2). As under the SDFQPA, less wealthy districts still qualify for supplemental state aid to account for varying property wealth among the districts, and S.B. 19 generally readopts the same aid formula approved by this court. See L. 2017, ch. 95, § 17; Gannon IV, 305 Kan. at 878.

         Districts can also still impose an additional levy of up to 8 mills for capital outlay expenses. L. 2017, ch. 95, § 89. And S.B. 19 readopts the same aid formula to equalize capital outlay funding between wealthy and poor districts that this court approved in Gannon v. State, 304 Kan. 490, 503, 372 P.3d 1181 (2016) (Gannon III) (for computing "school district capital outlay state aid"). L. 2017, ch. 95, § 50.

         Additional details regarding S.B. 19's provisions are included as necessary below.

         ANALYSIS

         ADEQUACY (ON THE MERITS)

         Issue 1: The State has not met its burden of establishing that the public education financing system provided by the legislature through S.B. 19 for grades K-12 meets Article 6's adequacy requirements.

         Introduction

         The State contends that through S.B. 19 it has reached constitutional compliance on adequacy. Specifically, S.B. 19 provides a BASE-the counterpart to the BSAPP of the former SDFQPA-of $4, 006 per pupil for fiscal year 2018 (that began July 1, 2017), which is an increase of $154 from the BSAPP amount of $3, 852 for fiscal years 2015 through 2017. When multiplied by the number of students, this contributes the bulk of the $194 million in the total "new money, " i.e., the funding increase from fiscal year 2017. It also provides a BASE of $4, 128 per pupil for fiscal year 2019, which contributes most of the approximately $97 million in new money for that fiscal year. BASE is to be adjusted annually thereafter by the average percentage increase in the consumer price index for all urban consumers in the Midwest region during the three immediately preceding years. L. 2017, ch. 95, § 4(e).

         For those two fiscal years, the total amount of money exceeding the fiscal year 2017 funding is approximately $292.5 million. The plaintiffs respond that these amounts are not constitutionally adequate.

         Standard of review and burden of proof

         Our standard of review for adequacy was clearly set forth in Gannon IV:

"Whether through structure and implementation the K-12 system is reasonably calculated to have all public education students meet or exceed the Rose standards presents a mixed question of fact and law. When an appellate court reviews these mixed questions, it applies a bifurcated standard of review. Insofar as any of the panel's factual findings are in dispute, the court applies a substantial competent evidence standard. 'Substantial evidence is such legal and relevant evidence as a reasonable person might accept as sufficient to support a conclusion.' Gannon v. State, 298 Kan. 1107, 1175, 319 P.3d 1196 (2014) (Gannon I).
"In determining whether substantial competent evidence supports the district court's findings, appellate courts must accept as true the evidence and all the reasonable inferences drawn from the evidence which support the district court's findings and must disregard any conflicting evidence or other inferences that might be drawn from it. Gannon I, 298 Kan. at 1175-76 (citing Unruh v. Purina Mills, 289 Kan. 1185, 1195-96, 221 P.3d 1130');">221 P.3d 1130 [2009]). Accordingly, appellate courts do not reweigh the evidence or assess the credibility of witnesses. State v. Reiss, 299 Kan. 291, 296, 326 P.3d 367 (2014).
"The panel's conclusions of law based on those findings are subject to our unlimited review. 298 Kan. at 1176, 1182. The ultimate determination of whether the legislature is in compliance with Article 6, § 6(b) of the Kansas Constitution is a question of law. See State v. Laturner, 289 Kan. 727, 735, 218 P.3d 23 (2009) (constitutionality of statutes presents question of law over which Supreme Court exercises unlimited review)." Gannon IV, 305 Kan. at 880-81.

         Additionally, as they did in Gannon IV, the parties have agreed this court may again take judicial notice of appropriate matters in the public record, even those not considered by the panel. 305 Kan. at 871-72; see K.S.A. 60-409(b) (allowing judicial notice of statistics maintained in the records of a state department); K.S.A. 60-412(c) (reviewing court in its discretion may take judicial notice of any matter specified in K.S.A. 60-409 whether or not judicially noticed by the lower court).

         As for the burden of proof, it remains with the State, as we stated in Gannon IV regarding the State's future efforts to replace CLASS that was due to expire on June 30, 2017:

"Once a new financing system is enacted, the State will have to satisfactorily demonstrate to this court by June 30, 2017, that its proposed remedy is reasonably calculated to address the constitutional violations identified, as well as comports with previously identified constitutional mandates such as equity. [Citation omitted.]
"For those purposes, the State will bear the burden of establishing such compliance and explaining its rationales for the choices made to achieve it. See Gannon II, 303 Kan. at 709 (party asserting compliance with court decision ordering remedial action bears burden of establishing that compliance)." Gannon IV, 305 Kan. at 856.

         We confirmed the State's burden of proving compliance in our June 19, 2017, Order establishing briefing deadlines and oral arguments in this matter.

         As further explained below, in addition to our again taking judicial notice of appropriate facts, we previously held that the panel's findings of fact were supported by substantial competent evidence. Gannon IV, 305 Kan. at 881. And we independently conclude that the State has failed to meet its burden of demonstrating constitutional adequacy. We express no conclusions regarding S.B. 19 provisions not raised by the parties as issues on appeal.

         Discussion

         Threshold determinations

         We begin our analysis by again recognizing that the legislature has the power- and duty-to create a school funding system that complies with Article 6 of the Kansas Constitution. Gannon I, 298 Kan. at 1146-47 (language of Article 6 both empowers and obligates the legislature to make suitable provision for finance of the educational interests of the State). We explained that Article 6, § 6(b) contained minimum standards of adequacy which are met when the financing system provided by the legislature for grades K-12-through structure and implementation-is reasonably calculated to have all Kansas public education students meet or exceed the standards set out in Rose. 298 Kan. at 1170. The Rose court held that:

"[A] . . . system of education must have as its goal to provide each and every child with at least the seven following capacities: (i) sufficient oral and written communication skills to enable students to function in a complex and rapidly changing civilization; (ii) sufficient knowledge of economic, social, and political systems to enable the student to make informed choices; (iii) sufficient understanding of governmental processes to enable the student to understand the issues that affect his or her community, state, and nation; (iv) sufficient self-knowledge and knowledge of his or her mental and physical wellness; (v) sufficient grounding in the arts to enable each student to appreciate his or her cultural and historical heritage; (vi) sufficient training or preparation for advanced training in either academic or vocational fields so as to enable each child to choose and pursue life work intelligently; and (vii) sufficient levels of academic or vocational skills to enable public school students to compete favorably with their counterparts in surrounding states, in academics or in the job market." 790 S.W.2d at 212.

         These are minimum standards codified by our legislature as educational goals since 2005, K.S.A. 2005 Supp. 72-1127, and presently codified in K.S.A. 2016 Supp. 72-1127. Gannon IV, 305 Kan. at 864; Gannon I, 298 Kan. at 1166-67, 1170. And in S.B. 19, the legislature has openly declared its intention to meet them. "It is the purpose and intention of the legislature to provide a financing system for the education of kindergarten and grades one through 12 which provides students with the capacities set forth in K.S.A. 2016 Supp. 72-1127." L. 2017, ch. 95, § 70.

         Plaintiffs' specific claims about how S.B. 19's structure is unconstitutional are rejected.

         Because plaintiffs acknowledge that S.B. 19 is very similar to the version of the SDFQPA that the legislature repealed, they do not challenge the overall structure as violating Article 6. Rather, they argue the failure to fund three statutory requirements renders S.B. 19's structure unconstitutional. Plaintiffs also argue that the 2017 legislature's tax bill, Senate Bill 30 (2017), will be inadequate to fund schools by fiscal year 2021. See L. 2017, ch. 84. They further raise concerns that future legislative bodies could refuse to raise the BASE amount for inflation as required by S.B. 19. L. 2017, ch. 95, § 4(e).

         Recent history lends some credence to plaintiffs' arguments regarding sufficient state revenue and the possibility that the inflation adjustment will not be funded if revenue falls short. See Gannon I, 298 Kan. at 1114 (summarizing reductions in education funding due to falling state revenue). But these doubts involve too many contingencies and require us to make too many assumptions. Instead, we address the statutory requirements that plaintiffs challenge. Overall, we hold the sections of S.B. 19 challenged by plaintiffs satisfy the structure prong of our test for adequacy under Article 6.

         The failure to fully fund statutory entitlements does not implicate structure.

         Plaintiffs argue S.B. 19 is structurally unsound because the legislature did not actually appropriate full funding of three statutory entitlements: (1) special education aid, (2) the professional development program, and (3) the mentor teacher program. This argument can be summarily rejected for the mentor teacher and professional development programs because neither statute guarantees their funding, i.e., they do not relate to structure. See K.S.A. 2016 Supp. 72-9608 (professional development state funds permitted "within the limits of appropriations"); L. 2017, ch. 95, § 63 (mentor teacher program grants are subject to available appropriations). The special education funding, however, requires a closer look.

         Consistent with prior law, S.B. 19 authorizes special education reimbursement at 92% of excess costs which are defined as the amount over and above the average cost of educating a student who is not receiving special education services. The statute's plain language does not limit funding to the amount actually appropriated. It provides: "The computed amount is the amount of state aid for the provision of special education and related services aid a school district is entitled to receive for the ensuing school year." L. 2017, ch. 95, § 60(a).

         S.B. 19 provides $12 million more per year than the prior law for a total of 24 million additional special education dollars. But this appropriation falls short of what SBE estimates will be required to reimburse at 92%. Plaintiffs argue the reduction of special education state aid forces districts to cannibalize other funding to cover the state and federal special education requirements. They analogize it to the prorated appropriation of supplemental general state aid traditionally used to equalize LOB funding that we held was unconstitutional in Gannon I, 298 Kan. at 1182-89.

         There, this court held that the proration of such aid created unreasonable wealth-based disparities between school districts and was therefore inequitable. Special education aid is not analogous, however, because it is not used to equalize funding.

         Plaintiffs' argument may be relevant to whether overall funding is adequate. But we conclude the mere underfunding of special education aid does not itself render S.B. 19 structurally inadequate.

         The State has not demonstrated S.B. 19's implementation meets the adequacy requirements of Article 6.

         Overall funding

         The State not only has the burden to show compliance in this remedy phase and to explain its rationales for the choices made to achieve compliance, but toward that end we have stated the State would help its case by "'showing its work.'" See Gannon III, 304 Kan. at 500. Consequently, the State submits its model and accompanying formula for how it arrived at its financial figures. As submitted to this court, the State primarily relies upon a 4-page memo from the Kansas Legislative Research Department (KLRD) dated May 12, 2017, as presented that day to the Senate Select Committee on Education Finance. The memo contains a page and a half of text and attaches four graphs. KLRD memo to Senate Select Committee on Education Finance, http://kslegislature.org/li/b2017_18/committees/ctte_spc_select_committee_on_education _finance_1/documents/testimony/20170512_02.pdf.

         According to the State, it utilized what it described as a "successful schools model" to determine the greater part of the $292.5 million. It correctly points out a similarly labeled "successful schools model" was one of the two models used in the A & M study ordered by the legislature and prepared for the Kansas Legislative Coordinating Council. As A & M described:

"The successful school (district) approach . . . seek[s] to infer a base cost figure from the actual spending of school districts, or schools, determined to be successful because they meet whatever standards are used by a state to evaluate student and school performance. Using this approach, a set of schools or school districts are selected from among all schools or districts that meet a variety of criteria related to their level of success in meeting state standards, their normalcy in terms of socio-economic characteristics such as district wealth or proportion of pupils from low income families, and their efficiency in terms of spending. Once districts have been selected, their basic spending (excluding spending for capital purposes, transportation, special education, other special programs, and any service funded by federal revenue) is examined to determine a base cost level." (Emphasis added.) A & M, p. I-3.

         The A & M study explained the heart of this approach:

"The successful school district approach is based on the simple premise that any district should be able to be as successful at meeting a set of objectives as those schools that actually meet those objectives provided that every district has the same level of funding that has been available to the successful districts, and that differences in student characteristics have been taken into consideration." (Emphasis added.) A & M, p. II-2.

         The State and amicus curiae Legislative Coordinating Council argue that by applying various criteria, the KLRD was able to identify the 41 "most successful school districts" in Kansas, i.e., those they describe as "exceed[ing] their expected performance by the greatest levels." Per the KLRD's May 12, 2017, memo, the first step in making this determination was to measure students' performance by four criteria:

(1) percentage of students at grade level in math and English Language Arts (ELA), e.g., reading;
(2) percentage of students at college and career ready level in math and ELA;
(3) students' average composite ACT score; and
(4) the four-year high school graduation rate.

         This first step is seemingly consistent with the typical use of this model. See, e.g., Campaign for Fiscal Equity, Inc. v. State, 8 N.Y.3d 14, 22, 828 N.Y.S.2d 235, 861 N.E.2d 50 (2006) (observing that three alternative student performance criteria were included in choosing the qualifying schools in the successful schools model). But we note the State does not identify the performance results it used from any of the districts, e.g., district "X" had 90% of its students performing at grade level in both math and ELA. Nor does it identify the year, or years, from which its data was taken-or the sources.

         Armed with this unidentified data, the State then plotted an unspecified number of districts on four graphs, one for each of the above-listed criteria-which served as the "Y" axis on the graph. The "X" axis was the same on each graph: the percentage of students on free lunch under the National School Lunch Program "for every district with 500 or more students." We observe that while it appears only a sample of Kansas' several hundred districts is shown by dots on the graphs, neither the districts nor the member characteristics of the sample are identified.

         According to the State, once the unspecified number of districts with unidentified demographic characteristics were each plotted by (1) its students' performance and (2) its percentage of students on free lunch, its "regression analysis" based on the scatterplots revealed a "line of best fit." The State contends that its regression analysis was "similar to that outlined" by State Education Commissioner Randy Watson in his presentation to the Senate Select Committee on Education Finance when "discussing successful schools that outperformed expected student outcomes." See Senate Select Committee on Education Finance, May 12, 2017, Meeting Minutes. We independently observe that one of the classical assumptions for regression analysis is ensuring "[t]he sample is representative of the population for the inference prediction." Gatsi & Gadzo, Introduction to Quantitative Methods in Business (2016). But the lack of State-supplied specificity that we previously mentioned necessarily undermines whatever persuasive value the State's chosen sample and resultant "line of best fit" might have.

         Despite these shortcomings, the State points to the KLRD memo to contend that once its line of best fit was determined, individual district performance results were predicted and then compared to their actual performance results:

"[T]he formula [correlation between the two axes] associated with that line was used to determine [predict] the expected [performance] results of a district at any given percentage of students eligible for free lunch. The actual [performance] results of the districts were then compared to the expected [performance] results of districts with the same percentage of students eligible for free lunch." (Emphases added.) See KLRD memo, p. 1.

         According to the State, its selected 41 districts were successful because they either "exceeded their expected results on all 4 measures" or had an "average scaled difference on all 4 measures" exceeding expected results by at least one standard deviation. KLRD memo, p. 1. However, the memo, the graphs, and the committee meeting minutes do not identify any of the other districts that were measured. And consistent with the KLRD's treatment of the 41 districts, no performance results-predicted or actual-are provided for these other districts either.

         Once those 41 districts were selected, the KLRD proceeded to calculate the per weighted pupil base amount for each. The memo describes the first two steps:

"The [1] sum of expenditures from the general fund, supplemental general fund [LOB], at-risk funds, and bilingual fund (excluding flow-through aid, transfers and transportation expenditures) was [2] divided by the weighted enrollment according to the weightings recommended by the [2006] ...

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