Wednesday, June 08, 2016

"Dude, Seriously?"


State Superintendent Dorn's filing.

Interview with Summer Stinson of Washington's Paramount Duty, Rep. Reuven Carlyle and Superintendent Dorn on Q13 yesterday.

Dorn is pushing for all kind of answers including, yes, closing down schools in 2017.  (That would give the legislature a whole year - a year - to get this done which, by their own requirements, they should have it all done before school year 2017-2018.)

Carlyle said it's a grown-up problem and that the work "wouldn't get done under threat of closing down schools."  I take his implication to mean that would be a childish thing to do and hurt kids and families.  Yes, it would and who's real fault would that be?

 Now at the WPD's Facebook page, I asked him - don't you think if the legislature got this promise - not a threat - a promise from the Court, they would get the work done.  Because I wouldn't care how miffed some in the legislature were with the action, my expectation would be they would get the work done because of the dire consequences.

Or is their pride greater than the kids?

Dorn is also going to be filing a new lawsuit next week over the State allowing districts to use levies for basic education.

end of update

In more McCleary news, the plaintiffs in the McCleary case gave their reply to the State's explanation of what is being done to fulfill the constitutional mandate to amply fund public education in Washington State.

As you can see by the title of this thread, the plaintiffs are both hard-hitting and entertaining.  But it's true - if you or your child's teacher told your child a firm deadline for a project with clear expectations about the quality of the work, that might be the reply when your child didn't get it done.

From the filing (red mine):
Plaintiffs do not expect this Court to use the same words. But as the following pages explain, this Court should come to the same conclusion: Despite the 2014 Contempt Order and 2015 Sanctions Order in this case, the State is still not complying with this Court’s rulings. 

Court orders and constitutional rights either matter or they don’t. If they do, this Court must effectively compel the State’s full compliance with Article IX, section 1 by the firm 2017-2018 school year deadline.
On the "plan" from the Legislature:
Another problem with continually kicking the can down the road is you eventually run out of road. Which is where the State now is. 2016 was the last legislative session that could produce a complete plan for phasing in the revenue and funding increases needed to reach full Article IX, section 1 compliance by the 2017-2018 school year. But instead of producing that plan, the State’s taking a ride on a frequently used merry-go-round: delay another year by creating another task force. Part V addresses the State’s 2016 ample funding “plan”.
Problems from not seeing McCleary enacted:
  • This Court also emphasized at least one concrete consequence – the looming shortage of 4,000 teachers for the full-day kindergarten and K-3 class size reduction components of the State’s basic education program.
  • This Court’s January 2012 decision reiterated that amply funding full-day kindergarten and K-3 class size reduction by the 2017-2018 school year are significant components of the State’s paramount constitutional duty.32 The State’s 2016 filing acknowledges the 2017-2018 school year deadline for these two components.33
Carefully worded assertions in the State’s 2016 filing imply these two components are fully funded. But what the State’s assertions actually mean is State funding formulas will be fully funded.

And that’s an important distinction – for the court rulings in this case establish the State cannot claim a component of basic education is “fully funded” if its funding formula only provides a part of its school districts’ actual cost to provide that component.
  •  School districts’ continuing inability to pay the compensation needed to attract and retain needed personnel has left them with a substantial shortage of the people required to deliver a quality education.
    • The State’s 2016 filing repeatedly says pupil transportation and MSOCs (Materials, Supplies, and Operating Costs) are fully funded.  But it also acknowledges that what it instead means is the State’s funding formulas for pupil transportation and MSOCs are fully funded. 
    • The State’s own documents acknowledge the MSOC formula’s funding levels are based on a snapshot of what districts purchased with the unconstitutional underfunding they had in the 2007-2008 school year. This Court has reiterated that when an earlier snapshot does not correlate to constitutionally ample funding today, fully funding that outdated snapshot is not 
      “full funding”.   
      As for levies:

      The State suggests that its production of the ample funding phase-in plan this Court mandated most recently in its January 9, 2014 Order is being delayed because the State wants to combine that ample funding plan with politically challenging levy reform. But that’s not an excuse for any delay. This Court’s August 2015 Sanctions Order unequivocally told the State that “Local levy reform is not part of the court’s January 9, 2014 order.”

      The “unconstitutional reliance on local levies” noted in this Court’s decision was a rejection of the notion that the State can take credit for local levy dollars as being part of its State funding. It was not a suggestion by this Court that the State could solve school districts’
      lack of ample funding with “reforms” that take local levy dollars away and then hand them back calling them State dollars (the so-called “levy swap” or “levy swipe” reform).
      Then they bring it on home:
    Last year, this Court celebrated the 800th anniversary of the Magna Carta. The Magna Carta is historically significant because it established the principle that the rule of law applies to everyone – even those who run the government.
    Plaintiffs appreciate that complying with that constitutional mandate is not easy, cheap, or popular for those who run State government.

    But it’s the law.
    The real bottom line?
    But as noted earlier, this Court has held the State cannot declare “full funding” when its funding formula leaves part of a district’s actual cost unfunded.
    Washington's Paramount Duty group filed an amicus curiae with the Court yesterday.  I was pretty excited when previewing the caselaw and statutes cited to see Marbury v. Madison.  
    Here's what they had to say:
    Not only has the State failed to comply with this Court’s lawful orders to rectify the chronic underfunding of Washington’s public schools, it continues to make deliberate decisions to deny Washington’s more than one million public school students their constitutionally guaranteed rights to an education which provides them “the basic knowledge and skills needed to compete in today’s economy and meaningfully participate in this state’s democracy.”
    Throughout, the State has maintained that this Court is somehow exceeding its constitutional powers and encroaching upon those of the Legislature. But in fact, this Court would be abandoning its duty and fundamental role as a separate branch of government were it to accede. Further, this Court’s actions in this case are not unique or even unusual, as courts across the country have been tasked with similar questions and reached similar results. Amicus asks the Court to issue an order that unless the State amply funds its public schools as our constitution requires by April 28, 2017, the Court will suspend the State’s tax exemption statutes enacted by the Legislature.
     The Magna Carta, Marbury v. Madison and Charlie Brown (from the plaintiffs, page 42) - that makes for interesting reading.

    (I will note that charter supporters got upset at the Court for using 100-year old case law and yet Marbury v. Madison is dated 1803 and the Magna Carta is ancient at 800 years old.  I guess caselaw is caselaw.)


    Charlie Mas said...

    Everything about this case continues to astonish me:
    The Court's patience with the members of the legislature
    The legislature's obstinate refusal to comply with the state constitution
    The arrogant tone of some legislators declaring themselves above the law
    The electorate's apathy that allows them to re-elect non-performing legislators

    A remedy is needed. I like the one proposed by WPD, suspending tax exemptions. Most of all I would dearly love to see the Court jail legislators for contempt - starting with those who encouraged the Supreme Court to "pound sand".

    Melissa Westbrook said...

    Randy Dorn's latest press release says this (partial):

    "In the brief I present the Court with five options:

    Hold individual legislators in contempt and subject to a remedial penalty
    Prevent the payment of special levy funds to school districts
    Prevent the operation of certain state tax credits and exemptions
    Prevent the expenditure of non-education state funds that are not constitutionally required or otherwise necessary

    And finally, close our public schools until the legislature makes real progress in fully funding our schools.

    As I note in the brief, the Court previously stopped imposing the $100,000-a-day penalty on the state while it was in session. Along those lines, I would support stopping the fine if the Legislature holds a special session on funding this fall or if new members are required to attend an education workshop, where they will learn about basic education and their constitutional duties regarding basic education.

    These options are dramatic, but it is clear by now that the Governor and the Legislature will continue to ignore the Court and continue to avoid doing their constitutional duty until the Court does something dramatic. That time has come."

    1)When your state's own superintendent of public schools says to close down the schools, you're in trouble.
    2) And yes, where is Governor Inslee? MIA

    Melissa Westbrook said...

    Also from The Stranger on The Most Highly Paid CEO in America (lives in WA state):

    "Dara Khosrowshahi, the CEO of Expedia, made $94.6 million in 2015, nearly $40 more than the person in second place on Equilar’s list of highest paid CEO by state.

    Washington, which is criminally underfunding its public education system, has no income tax at all. If the state adopted New York’s income tax rates, Washington would have made $8.34 million just from Khosrowshahi alone. Under California’s income tax rates, the state could have collected $12.58 million—enough to pay the salaries of 211 mid-career Seattle teachers."

    Joseph Rockne said...

    Isn't most of his compensation stock options? While it has been a long time since I've taken a tax course, I don't believe there would be any tax owed, certainly not any income tax owed, on the value of a stock option grant. There would be tax owed (capital gains tax) when/if the stock was sold.

    Anonymous said...

    Under federal law, NSOs are taxed when exercised but ISOs are subject to the alternative minimum tax when granted. Of course, states create their own income tax laws. Many do follow the federal system but they're not required to do so.

    Tax Fan

    tax dude said...

    To follow up on the tax question, NQSO are subject to income tax and payroll taxes when they are exercised. If you exercise and hold the underlying stock, you are also subject to capital gain if the stock value goes up.

    ISOs are subject to AMT when exercised. You need to hold the stock at least a year to get the preferential tax treatment. In the dot com bust, lots of unlucky souls were subject to AMT, then their stock tanked during the one year holding period. They owed a ton of money to the IRS for worthless stock. In some case, it was hundreds of thousands of dollars. Plus, you can't file for bankruptcy for a tax debt. I think ultimately Congress passed a law to give some relief to these folks, although my memory is a bit foggy.

    Eric B said...

    My favorite part of the filing is all of the references to Brown v. Board of Education and the Japanese-American internment. Well, that and the conversational style and the thorough poking of holes in the State's argument. I think the best of those is calling out the Legislature for doing another year of study when they said in 2012 (or thereabouts) that they shouldn't have to do another court-mandated study because they knew exactly what they needed to do.

    NO 1240 said...

    I find it interesting that Dorn suggests limiting the flow of levy dollars into school districts. Students would be harmed.

    Dorn likes to pick and choose which laws are followed in Olympia. He was responsible for working with the Gates Foundation and Washington Charters to circumvent our highest court's ruling.

    Dorn altered rules to allow the flow of public dollars into charter schools..after the Supreme Court declared I 1240 to be unconstitutional.

    There is no reason to respect Dorn.

    NO 1240 said...

    Interesting that Dorn had no problem circumventing our court's highest ruling to provide funding for 800 students, but he suggests holding levy funding from tens of thousands- if not- hundreds of thousands of students?? Sadly, this is the representation we have in Olympia.

    Melissa Westbrook said...

    I think Dorn's point on levy dollars is that the State should be picking up more of the cost and has found it convenient to allow districts to run more levies.

    I absolutely agree on his work on charter schools and I think when the final story gets told - and it will - his office is not going to look great.

    Outsider said...

    I am not a constitutional law expert, but I play one on the internet. Ha ha, don't we all? But seriously, here is an explanation for perhaps why the Supreme Court treads lightly:

    Politicians in the capital (any capital) love to pass unfunded mandates, because it allows them to be the good guys delivering goodies without being the bad guys who raise the taxes to pay for it. WA politicians in Olympia did plenty of that with Education. Districts were left to pay the cost through local levies. Then the Supreme court stepped in and said sorry pals, that's unconstitutional with education. The constitution says the state has to pay for everything.

    The wrinkle is, when politicians are denied the pleasure of unfunded mandates, they could respond by either funding the mandate, or repealing the mandate. The Supreme Court didn't want the problem to be solved by repealing mandates, so they tried to play gotcha -- bluffing that any mandate passed by the legislature in the past can never be repealed ever again ever until the Earth melts. But that is clearly overstepping their constitutional bounds and risks a constitutional crisis. So naturally they tread cautiously.

    Problem is, the definition of "basic education" is deeply subjective, and not spelled out in the constitution. Presumably it should be the legislature's job to define basic education, and the Supreme Court can only justify butting in if something goes clearly wrong, or based on principles more solid than "you passed it before the last election so you are stuck with it forever."

    Legislators, for their part, must navigate between: constituents who like education but not taxes; the Supreme Court's bluff; and their own internal disagreements. If anyone is surprised that the process drags on and on, well, don't be. Quick resolution would have been the real surprise.

    Melissa Westbrook said...

    Good analysis, Outsider.

    Anonymous said...

    Outsider wrote:

    Legislators, for their part, must navigate between: constituents who like education but not taxes; the Supreme Court's bluff; and their own internal disagreements. If anyone is surprised that the process drags on and on, well, don't be. Quick resolution would have been the real surprise.

    IMO, so true. I've seen a number of people hold up NJ as an example of a state that shut down the schools and then finally funded education. Yet I know no one here who wouldn't absolutely flip out at being hit with an income tax and their property taxes doubling if not tripling (an estimation - friends with a $500k house in NJ pay $15k a year in property taxes vs the $5k that would cost here).

    NE Parent

    Anonymous said...

    Re : Outsider,

    I agree with your assessment of the politicians and their habit of passing unfunded mandates.

    But I disagree with your view of the Supreme Court. The Supreme Court is neither playing gotcha nor bluffing. The Court is simply calling out the legislators for their dereliction of duty.

    I completely understand the difficult waters that the legislators have to navigate in order to do their job but this does not excuse their delay tactics, continued inaction and utter lack of responsibility on the issue of funding public education. Their lack of effort is most appalling.


    seattle citizen said...

    NE Parent -
    You write that a friend "with a $500k house in NJ pay $15k a year in property taxes vs the $5k that would cost here"

    Are those taxes local or state? Are they assessed due to levies for the local district?

    I'm from NY, from a wealthy suburb that raised a lot of money for its schools. NY, NJ, all those NE states have, in addition, income taxes, hefty ones. People complain yet pay; it's what you do.

    Anonymous said...

    Seattle citizen- I am also from a NY wealthy suburb. I agree that people complain yet pay. My parents always said school taxes were among highest in nation, yet schools are some of the best. Class sizes about 1/2 the size of what they are here, comparable to selective private schools in Seattle. Those high taxes also pay for all sort of services, including many more police depts & officers that actually patrol neighborhoods unlike Seattle where we just don't have the resources. There are huge differences in resources that those taxes support. For example, we are expected to just live with the daily break-ins that happen all over our neighborhoods in Seattle. We just don't have the police resources here. I anticipate it will continue to get worse as we grow in population, unless new taxes are added to support resources to address the growth.

    z said...

    Both of the last 2 posts highlight a likely insurmountable problem. You both state that "people complain, yet pay". But you both came from wealthy suburbs. It's feasible for everyone to complain but still pay.

    In non-wealthy suburbs, or diverse economies across large regions like an entire state, that's just not the case. Adding an income tax to our existing system here in WA would be a drastic change that has the potential to destroy the fragile economy here; the reality is that it's impossible to know the consequences. For example, it would almost certainly push companies that are able to relocate to move elsewhere, reducing the tax base. It's not a simple win.