Gov. Sam Brownback will lay out his legislative agenda for the 2013 session when he delivers his third State of the State address, scheduled for 6:30 p.m. today.

But a ruling last week by a special three-judge panel in the ongoing school finance lawsuit will cast a shadow over the legislative options available as Brownback and state lawmakers craft tax policies and a budget for the upcoming fiscal year, which begins July 1.

On Friday, the panel ruled in the case of Gannon v. Kansas that current levels of school funding are unconstitutional under Article 6 of the Kansas Constitution, and that the Legislature has to adhere to funding standards that the Kansas Supreme Court approved in 2006 when it dismissed the last school finance case, Montoy v. Kansas.

That means, at a minimum, the Legislature has to provide $4,492 in “base state aid per pupil” next year — an increase of 17 percent from this year’s funding level of $3,838 per pupil. In all, that’s about $442 million above the current funding level.

Immediately after the ruling, Brownback and incoming House Speaker Ray Merrick of Stilwell, both Republicans, issued statements saying the court had overstepped its bounds and asserting that only the Legislature has constitutional authority to determine budgets.

But legal scholars say that under the Kansas Constitution, the separation of powers is not that clear, especially when it comes to school finance.

“It is true that only the Legislature has authority to appropriate money,” said Richard E. Levy, Kansas University law professor. “But Montoy held that Article 6 created a judicially enforceable duty to do so. The big question is, what happens if the court decides that the Legislature has failed to meet its duty?”

Article 6, Sect. 6, of the state constitution requires the Legislature “to make suitable provision for finance of the educational interests of the state.” That language was adopted as part of an amendment Kansas voters approved in 1966 that completely rewrote the section dealing with education.

Previous ruling

In the Montoy case, the Kansas Supreme Court ruled that “suitable” financing means at least the amount needed to cover the actual cost of providing all the educational services required by law.

Plaintiffs in both lawsuits have argued that the Legislature has imposed requirements on schools that carry with them certain costs. Those include compulsory attendance laws, high school graduation requirements, qualified admissions standards for attendance at state universities, and the entire system of accrediting public schools, including requirements that students meet certain academic achievement benchmarks.

In the Montoy case, the Court ordered the Legislature to increase funding to levels recommended by a cost study that the Legislature itself had commissioned. The decision resulted in a special session in 2005 and a standoff between the Legislature and the court as Republican leaders protested the court’s interference in what they saw as a legislative prerogative. Eventually, though, lawmakers relented and approved a multiyear funding plan that was supposed to have raised base state aid per pupil to $4,492 for the 2009-10 school year and beyond.

But in the fall of 2008, state revenue plummeted following the national collapse of the housing and financial industries, leading to a prolonged economic recession. Then-Gov. Mark Parkinson, a Democrat, ordered immediate cuts in state spending, including cuts to public schools. Brownback, his successor, followed up with further cuts in 2011, and the Legislature made further cuts that year, lowering the base state aid formula to $3,780 for the 2011-12 school year, the lowest funding level since the late 1990s.

The statute calling for base funding of $4,492 per-pupil still stands on the books, but the Kansas Legislature has not funded that amount in its annual budgets since 2009. Instead, lawmakers have approved smaller funding levels, resulting in funds being distributed to local districts on a pro-rated basis. School districts have had to cut employees and programs to make up the difference.

Legislative rebuff

The reduced funding is the action that the three-judge panel ruled unconstitutional. The court’s order prohibits the Legislature from doing that in the future, or taking any other action that would result in schools receiving less than they would under a $4,492-per-student base aid formula.

Attorney General Derek Schmidt, also a Republican, has said he will appeal the panel’s ruling to the Kansas Supreme Court, and it is widely assumed that the district court’s order will be stayed pending that appeal.

“I’d be surprised if they didn’t (grant a stay),” said Bill Rich, a constitutional law professor at Washburn University in Topeka. “Actually, I think it’s even possible the district court would stay its own opinion pending the Supreme Court appeal.”

Rich said a stay would effectively give the Legislature one session to address the issue.

On Monday, incoming Senate President Susan Wagle, R-Wichita, said Republican leaders may try to push through a constitutional amendment in time to be placed on the April 2 election ballot. Options that have been debated in the past include changing or eliminating the “suitable” funding requirement, or clarifying that it’s the Legislature’s job to define what is suitable.

“That’s certainly possible,” Rich said. “As a general rule, the courts at whatever level are going to be responsible for applying the law at whatever time the courts rule. It is possible for the Legislature to change the underlying law while a lawsuit is pending. Where the underlying law has changed, that in turn can make a particular lawsuit basically a moot point.”