Attorneys: Lake View still ‘good law,’ but questions remain

The Lake View school funding case probably is still “good law” despite a recent court ruling that the state can’t be sued under the Arkansas Constitution. But the ability of citizens to seek redress for school funding and other issues will have to be clarified by future court cases.

That’s according to testimony Monday to the House and Senate Education Committees by the Bureau of Legislative Research’s Matthew Miller, assistant director for legal services, and Isaac Linam, staff attorney.

At issue is how much the Lake View School District No. 25 v. Huckabee school funding case is affected by The Board of Trustees of the University of Arkansas v. Matthew Andrews. In that case, the court ruled that the state enjoys so-called “sovereign immunity” that can’t be waived by legislation.

Miller said the two cases do not offer an apples to apples comparison. The Andrews case involves a statutory issue, while Lake View involved a constitutional school funding issue where the Supreme Court offered a clear mandate.

“We don’t have direct precedent, but we have to stretch Andrews a long way to reach Lake View and strike it down at this point,” he said.

Linam agreed, saying, “I think we should probably presume that Lake View is still good law.”

Miller said it is not yet clear what would happen if the state changes the school funding formula until there’s more precedent. And more precedent is likely coming in the near future because so many ongoing cases are affected by Andrews.

The Lake View case fundamentally changed Arkansas’ public school funding system. In 1992, the small, poor Lake View School District filed suit against the state claiming the public school funding system violated the 1874 Arkansas Constitution and the United States Constitution because it was inadequate and inequitable. The Arkansas Constitution requires the state to “ever maintain a general, suitable and efficient” education system.

The case was not ended until 2007. In the meantime, Arkansas increased funding for public schools and created a funding formula meant to spread the wealth to school districts throughout the state. Funding for K-12 education is assured before all other state priorities are funded. Major education policy and other state funding decisions have been based on keeping the state from enduring another painful lawsuit.

Then on Jan. 18, the Arkansas Supreme Court ruled 4-2 in Andrews that the state has sovereign immunity and can’t be sued. It interpreted precisely Article 5, Section 20 of the Arkansas Constitution, which says, “The State of Arkansas shall never be made defendant in any of her courts.” The court said suits that subject the state to financial liability are barred and must go through the Arkansas Claims Commission.

Miller said the court had held a similar view before reading the section less literally starting in 1996.

“So basically we revert to the line of thought we were following pre-1996,” he said.

Among the questions to be answered is the extent to which Arkansans can sue by saying the state is not meeting its school funding adequacy responsibilities. Miller agreed with Majority Leader Jim Hendren, R-Gravette, who said, “Basically, we won’t know until somebody files a lawsuit and the Supreme Court decides.”

Miller said Arkansas is one of three states – the others are Alabama and West Virginia – with similar sovereign immunity sections in their Constitution. Alabama’s has seven settled exceptions. Twenty-three state constitutions explicitly say their legislatures can pass sovereign immunity statutes. Twenty-four don’t address the issue. Some state constitutions previously included sections like Arkansas’ but amended them.

In recent months, the court has answered some basic questions about the issue. Is sovereign immunity a jurisdictional issue, which means suits are automatically improper, or must the state assert an affirmative defense? In Walther v. Flis Enterprises, the court ruled the state must present an affirmative defense. Other court rulings have made it clear that the state’s minimum wage and whistleblower laws are unconstitutional where they allow suits against the state.

Miller said it’s safe to assume that Andrews applies to other legislative waivers of sovereign immunity, including the state’s Administrative Procedures Act, rules banning the dicamba herbicide, the state’s Religious Freedom Restoration Act, and possibly the Freedom of Information Act.

Miller said the majority opinion in the Andrews case did not say the decision is limited to monetary damages. In the minimum wage case, the court could have made a distinction between sections of the law allowing actions for both equitable and monetary disputes. Instead, the court struck down the law in its entirety. It did the same in the whistleblower case.

Still to be determined is whether plaintiffs can sue over the awarding of medical marijuana licenses. Pulaski County Circuit Judge Wendell Griffen ruled that sovereign immunity did not apply if a state agency is acting illegally. The Supreme Court would still have to weigh in on the case.

“If that was appealed and affirmed, then that’s some interesting precedent that we’d have going forward that would impact future cases like Lake View,” Miller said.