NM Supreme Court says Zuni-Gallup schools funding case is moot

On Monday, the New Mexico Supreme Court declined to issue an opinion in a case brought against the state by the Zuni and Gallup-McKinley school boards challenging the constitutionality of the way the state funds school facilities. The justices said, in part, the Legislature made changes to a state statute since the litigation began more than 25 years ago.

Chief Justice David Thomson and the other justices stated in their four-page order that since lawmakers made changes to capital outlay provisions following the school boards’ launch of the lawsuit in 1998, the case is moot and the court cannot consider the constitutionality of the statute.

But the case can be reviewed in district court should the school boards decide to sue, the justices said. If litigation occurs, 6th District Chief Judge Jarod K. Hofacket would preside over the case and be able to consider new evidence.

Ronald J. VanAmberg, a Gallup-based attorney who has represented the Zuni Public Schools Board of Education in their case for more than two decades, declined to comment on the order because he said it is complex and he needs time to review it with co-counsel.

Representatives with the Zuni and Gallup-McKinley school districts also declined to comment.

New Mexico Department of Justice spokesperson Lauren Rodriguez said in a statement that the agency is pleased with the court’s ruling and commends the Legislature for “its commitment to improving our educational system.”

The original lawsuit, which included Grants-Cibola schools, took issue with federal impact aid, intended to make up the tax revenue lost by school districts that could not collect property tax on federal land, according to previous news reports. The state was allowed to take 95% of the aid to disperse to all 89 districts as part of the funding formula, but only 5% was to be used on building projects, the Journal previously reported. .

During the 1997-98 school year, for example, the Zuni district lost $5.3 million of federal impact aid to the state and Gallup-McKinley lost $18.5 million, according to previous news reports. With losses like those, the districts argued the funding system was unfair.

In 1999, Gov. Gary Johnson signed Senate Bill 418, decreasing the state’s take of federal money from 95% to 75%. However, he vetoed House Bill 256, which would have created a sliding scale based on a mathematical formula that considered a district’s needs.

That same year, District Judge Joseph Rich of Gallup ruled that New Mexico’s school capital outlay funding formula was unconstitutional. Zuni, Gallup and Grants-Cibola received millions more for capital facilities, but attorneys still believed the new law would create inequity in school construction funding.

In October 2002, following a three-day hearing between lawyers, former state Supreme Court Justice Dan McKinnon — the special master in the lawsuit — scheduled a hearing on whether the state had complied with Rich’s order. After hearing attorneys’ arguments, he found the state was making a “good faith” effort toward establishing a uniform system for funding public-school construction, the Journal reported.

In 2013, the districts filed a motion to reinstate the case. In 2016 and 2019, bench trials were held challenging McKinnon’s findings, according to an appellate court filing. Following the trials, which had been paused for more evidence to be produced, 11th District Court Judge Louis DePauli Jr. found in 2020 that the state’s way of funding capital school projects was not consistent with the state constitution, the Journal reported.

The following year, when the state was denied relief, it filed with the New Mexico Court of Appeals before the case made its way to the high court.

Senate President Pro Tem Mimi Stewart, D-Albuquerque, — a retired educator who has been watching the lawsuit closely — said she was gratified with the state Supreme Court’s ruling because it acknowledges the reforms the Legislature has made over the years.

One of those reforms is House Bill 6, which Gov. Michelle Lujan Grisham signed into law in 2021 allowing for the reappropriation of 75% of federal impact aid dollars to initiatives that help local school districts.

Stewart said the school district’s original lawsuit “had merit,” and that’s why lawmakers have spent over 20 years working on reforming the way capital funds are spent on schools. She said she was not worried about Zuni or Gallup-McKinley school districts suing again because they have officials who understand that capital facilities funding has improved.

Information from the Albuquerque Journal’s archives was used in this report.

Editor's note: This story was corrected to reflect that Ronald J. VanAmberg, the attorney representing the Zuni Public School District Board of Education, spoke to the Journal for this article. The Journal identified the wrong attorney in the original article.