The Delaware Department of Education’s Secretary of Education Dr. Susan Bunting requested a legal opinion from the Delaware Department of Justice. She wanted to know if the Department could legally enforce local school districts to send non-minor capital improvement match tax funds to Delaware charter schools. What did the DOJ say?
On October 13, 2017, the Department of Justice received a request from the Delaware Department of Education for an opinion regarding the application of the formula contained in Title 14, Sections 408(d) and 509(e) of the Delaware Code to “match tax” expenditures that are funded by taxes levied by local school boards under authority granted by 14 Del. C. § 1902(b). Your letter indicated that it was being sent pursuant to a request from local school superintendents for an Attorney General’s opinion.
This issue regarding local funding for charter school choice payments exploded last school year when the Delaware DOE changed the formula but then former Secretary of Education Dr. Steven Godowsky put a hold on those changes. As a result, 15 Delaware charter schools sued the DOE and the Christina School District. The matter resulted in a settlement over a year ago.
We have engaged in no independent factual investigation of these issues and rely entirely on the information you have provided us to assess these issues. With those caveats, our conclusion is that the statutes in question place this issue entirely within the discretion of the Secretary of Education.
The Deputy Attorney General handling the opinion was Catherine Hickey. She is also assigned to the Delaware DOE by the Delaware DOJ. She ruled in favor of the Delaware Secretary of Education having the discretion to determine how local funds from school districts can be applied to choice payments to charter schools as long as the decision is not “arbitrary” or “capricious”. While there is no case precedence on this issue, Hickey wrote the intent of the Delaware General Assembly is very important.
If the legislative intent was that these funds be subtracted from the Total Operating Expenditure in Preceding Fiscal Year when calculating per pupil costs, the legislature could have included such language in the epilogue, amending Sections 408(d) and 509(e) and listing non Minor Capital Improvement match tax funds as a category to be subtracted before computing per pupil costs. Its decision not to do so must be given meaning when interpreting the statute.
So what does this mean? It means this will be the way things go on charter school choice payments going forward unless the General Assembly changes the statute. The DOE did give a three-year tier system for these changes. This year, districts can hold 50% of those funds, next year 25%, and in year three they can’t hold back any. To read the DOJ legal opinion, please see below.