Closing desegregation loophole could choke TUSD's finances

Tucson Citizen News
Thursday, January 8, 2009
Mark Kimble

A legal loophole that has allowed the Tucson Unified School District to rake in hundreds of millions of extra dollars over the past 25 years may be about to slam shut.

There is no doubt TUSD and 18 other like-minded Arizona school districts need the extra money, which they say is for desegregating schools.

But the way the money has been collected is constitutionally iffy, with school districts given free rein to dip into taxpayers' pockets with no limits and no voter approval.

Over the years, some state legislators have tried - and largely failed - to seal this bottomless money pit. But now the state's bleak financial outlook - and an upcoming lawsuit - may finally turn off the spigot.

If that happens, TUSD would have deep budget problems, losing a pot that makes up nearly one-fifth of its current operating budget.

It is difficult to understand how the desegregation loophole has remained open as long as it has. The state constitution is pretty clear:

"The Legislature shall establish by law expenditure limitations for each school district beginning with the fiscal year beginning July 1, 1980. Expenditures by a school district in excess of such an expenditure limitation must be approved by a majority of the electors voting on the excess expenditures."

Each school district is allowed to spend a certain amount. If it wants to spend more, voters must approve. But that has been rendered meaningless by the giant desegregation loophole.

Under the loophole, state law allows a district to budget an unlimited amount for expenses it says are needed to comply with a desegregation order. There are no checks, no balances. If the district says it needs the money for desegregation, there isn't a darn thing anyone can do about it.

TUSD started collecting money for desegregation in 1983. That year, desegregation spending was only $2.1 million - less than 1.3 percent of the total budget.

But over the years, minority students apparently became much more expensive to teach. By 2003, the district had desegregation spending of $6 million - 18.9 percent of its budget.

Because of a semi-cap, the amount has not climbed much. This year, TUSD said it needed about $64 million for desegregation efforts - 18.6 percent of the $345 million budget.

Statewide, 19 districts collected $212 million in desegregation funding this year. TUSD collected the most - about 30 percent of the total.

But now the desegregation loophole may be caught in an inescapable pincher. On one side, the state's sickening budget problems, which has legislators digging in the couch cushions for every spare dime. The desegregation pot would look inviting.

On the other side, a lawsuit that will be filed by two politically well-connected groups to have the loophole declared unconstitutional.

The Arizona Tax Research Association and the Goldwater Institute are expected to file a lawsuit soon to fight desegregation funding.

Kevin McCarthy, president of ATRA, said unlimited desegregation funding not approved by voters "is in complete violation" of the state constitution.

McCarthy noted that school districts spend almost all of their money on salaries and benefits. Those able to tap into desegregation dollars have more money to spend on the same things.

Districts such as TUSD point to the many good things that have been done with desegregation money - such as magnet schools. But districts without the extra money also have established magnet schools to compete with charter schools.

But magnet schools aren't the only thing desegregation money is spent on. And school districts haven't helped their case by the way they spend the bonus dollars.

A 1990 report by the state auditor general found improper spending of desegregation money across the state - including at TUSD. The spending hasn't been studied by the state since.

TUSD has used desegregation dollars for cell phone airtime, safety training, office supplies, electricians, locksmiths, painters, plumbers, dental hygienists, clerical overtime and all sorts of things that have not made schools less segregated.

TUSD - and all Arizona school districts - absolutely need more money. But it's not fair for some districts to have a bottomless well to tap while others must live within limits or ask voters for permission to spend more.

Given the chance to approve the extra spending, as required by the constitution, it is unlikely TUSD voters would do so. But we've never been given the chance.

I would bet that won't be the case much longer.