South Dakota Districts to be Heard Before State Supreme Court

Last Updated: December 21, 2010

This article appeared in the December 2010 Rural Policy Matters.

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A lawsuit brought by a coalition of primarily rural school districts suing the state over its funding system will be heard in the South Dakota Supreme Court next month, more than four years after being first filed.

Last year Circuit Judge Lori Weber found the state’s funding system to be constitutional, holding that there is no quality standard required. South Dakota’s State Constitution requires a “general and uniform” system of education.

Parents and students are plaintiffs in the suit, and the legal challenge was supported by about two-thirds of the state’s 161 school districts. Plaintiffs focused their testimony on the severe impact of underfunding on South Dakota rural schools, including the inability of districts to retain teachers or safely maintain facilities.

The lawsuit has undergone a difficult process to reach this point. Last year Judge Weber also ruled — in a separate decision — that the coalition of school districts could not participate in the suit because they were using taxpayer funds on the legal action.

The funding decision was appealed by the individual plaintiffs rather than the districts, with the group’s attorneys working pro bono to move the case forward.

The ruling on the districts’ participation was later reversed by the state’s high court. But districts were forced to undergo audits ordered by the state’s Attorney General in response to their participation.

Outgoing Governor Mike Rounds has called the suit a “waste of money.” The Governor is required by law to submit a proposed budget, and Rounds' proposal for the upcoming year includes a 5% cut to schools. Rounds has said that districts can tap their reserves and eliminate programs if need be to deal with the cuts.

Governor-Elect Dennis Daugaard will consider Rounds’ proposal as part of his budget planning. 

State law requires the state to increase aid to schools by the inflation rate. But aid was frozen at last year’s level earlier this year. One acute budget issue driving the cuts in South Dakota, as in many places, is rising costs for Medicaid as a result of more citizens falling into poverty and becoming eligible to participate.

Meanwhile, school districts are asking for continuing permission to use building funds to pay for operating costs. Several school leadership organizations have said publicly that this stopgap measure is a bad idea, but they claim it is necessary to keep schools running.

Lawsuit news:

Rounds’ funding proposal:
Editorial on funding cut:
Local school leaders on budget flexibility and other budget issues

Read more from the December 2010 Rural Policy Matters.