New Finance Lawsuit in Montana

Last Updated: October 27, 2011

This article appeared in the October 2011 Rural Policy Matters.

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The Montana Quality Education Coalition (MQEC) is going back to court to try to rescue $8 million in school funding that they allege was illegally cut from the state’s education budget this year. Schools in Montana are guaranteed to receive an inflationary increase in state funds. The main biennial school-funding bill passed by the legislature this year included a 1% increase for this year and 2.43% for next year, for a total of 3.43% as directed by law. However, the bill also included contingency language so that some education funding relied on another piece of legislation that was ultimately vetoed by Governor Brian Schweitzer. As a result of the veto, the final allocation for schools was $8 million short of the inflationary increase. The lawsuit contends that the contingent nature of the required original funding bill violates state law.

Montana legislators say that they created the contingency language to ensure that tourism dollars as well as oil and gas revenues would be used for school funding, a plan opposed by Governor Schweitzer, who called the tourism dollars too unstable.

The sources of school funding for Montana’s schools have been a source of controversy and disagreement among education groups, politicians, and other state agencies. Oil and gas revenues, part of land trust funds that are largely dedicated to K–12 education, can fluctuate widely with economic conditions. In addition, school officials point out that surpluses that are gained in these revenues are not always distributed to schools during the funding biennium and that legislators set a funding amount for schools that does not increase when additional monies come in.

MQEC let the Columbia Falls school finance lawsuit effort that succeeded in securing additional education funding following the 2004 court victory, but funding has not been maintained as the economy declined. MQEC is made up of school districts and educational organizations from throughout Montana, including the Montana School Boards Association, School Administrators of Montana, the Montana Rural Education Association and the Indian Impact Schools of Montana.

Read more:

Local coverage:
MQEC’s website maintains many of the legal documents filed in the earlier lawsuit, as well as additional local coverage of recent developments:
Editorial on using various revenue sources for school funding system in the state:

Read more from the October 2011 Rural Policy Matters.