The Colorado Court of Appeals held oral arguments yesterday (Monday, 19 November) on a challenge to Denver District Court Judge Michael Martinez’ ruling in the Douglas County Choice Scholarship Program trial.  The appeal, led by the Douglas County School Board and joined by the state of Colorado and several affected families, was held at the Colorado Supreme Court/Colorado Court of Appeals hearing room at  100 W. Colfax Avenue, Denver 80202 (the Denver Post building).

In that ruling, Judge Martinez decreed that the Douglas County Choice Scholarship Program violated multiple sections of the Colorado Constitution (Article IX, Section 7 Aid to Private Schools, Churches, Sectarian Purpose, Forbidden, Article IX, Section 8 Religious Test and Race Discrimination Forbidden Sectarian Tenets, and Article II, Section 4, Religious Freedom) as well as the state school financing act.

Monday’s oral arguments before the Colorado Court of Appeals, in which each side had 30 minutes to make their case, were recorded and posted online shortly after the hearing.

Attorney for the appellants (Douglas County School Board) Eric Hall opened with a description of the school choice scholarship program that touched upon the key legal issues at the heart of the appeal:

The program offers an additional educational choice to students who have been enrolled in Douglas County Public Schools for at least a year.  No family must participate in it; and it in no way hurts the opportunity of any student to receive a free public education.

Key points:

• additional educational choice (not replacing constitutionally mandated “free public education”)
• no family must participate (program participation is non-compulsory)
• no harm to or diversion of resources from existing system of free public education

Hall continued:

Through the Choice program, the district offers aid to parents, on a neutral basis, without regard to religion. As a neutral program, it neither favors nor disfavors any private school, religious or non-religious.

Key Point:
The test of constitutionality established in the 2002 U.S. Supreme Court Zelman case allows education vouchers to be used for schools including religious schools IF the overall program is neutral towards religion and IF the choice to attend religious schools is entirely left up to the parent:

This Court’s jurisprudence makes clear that a government aid program is not readily subject to challenge under the Establishment Clause if it is neutral with respect to religion and provides assistance directly to a broad class of citizens who, in turn, direct government aid to religious schools wholly as a result of their own genuine and independent private choice. See, e.g., Mueller v. Allen, 463 U. S. 388. Under such a program, government aid reaches religious institutions only by way of the deliberate choices of numerous individual recipients. The incidental advancement of a religious mission, or the perceived endorsement of a religious message, is reasonably attributable to the individual aid recipients not the government, whose role ends with the disbursement of benefits.

The fact that the program disburses funds directly to the parent, to use towards any school they choose, also addresses the Colorado constitutional prohibition on “direct aid” to religious institutions (Article IX, Section 7 Aid to Private Schools, Churches, Sectarian Purpose, Forbidden) since the aid is to the parent/student, not directly to the school.

Hall then addressed the provisions of Colorado’s School Finance Act, highlighting the aspect of local control (Section 104(1)(a)):

Finance Act funds flow to local districts… the amounts and purposes for which such Finance Act means are budgeted and expended shall be in the discretion of the district.

Key Point: 
The Douglas County School Board has the statutory authority to decide on how to allocate school funding dollars within the district.

[At this point, Judge Jones asked if the School Finance Act provided for standing of individuals to bring suit under the provisions of the Act; Hall responded that the Act does not provide such standing (indeed, explicitly rejects it) and noted that Denver District Court Judge Michael Martinez had erred in allowing individuals standing to bring a Finance Act claim.]

Hall then characterized opposition to the School Choice Scholarship program as being based on objections to the fact that

private and religious schools can participate… they assert public funds can’t be spent in this way.

Hall noted that a 1982 Colorado Supreme Court case (Americans United) held that “public funds can be spent at private and religious schools by means of a neutral program of private choice.”

[Judge Jones then brought up a question (based on a number of cases, including Lemon, Weaver, and Mitchell) concerning the "influence of overtly religious education on younger kids... being inconsistent with what we want to do with public monies."

Hall responded that, based on the Weaver case, "any sort of indoctrination doctrine is not only discarded, but unconstitutional" (as a 1st Amendment violation)]

Hall concluded by noting that the court “should apply the Zelman test” – with “genuine private choice” as the key criterion, recognizing that any incidental benefits to institutions with a religious character are attributable to parent choice, not impermissibly mandated by the program itself, and noted the existence of several state programs providing funds to schools with a religious component:

“Public funds can and do flow to institutions with a religious component” under current state practice and law.

Plaintiffs attorneys divided their time in oral arguments between addressing constitutional/religious issues and School Finance Act issues.

Attorney Matt Douglas first addressed the constitutional/religious objections to the Douglas County School Choice Scholarship program.

Douglas began by asserting that the program violates several specific articles of the Colorado Constitution with respect to the establishment of religion.  He further asserted that the appellants “must prove that the trial court was wrong on ALL of the constitutional provisions” to overturn that court’s judgment.

Douglas stated that the Colorado Constitution “specifically prohibits state funding of religious education” (under Article IX, Section 7 Aid to Private Schools, Churches, Sectarian Purpose, Forbidden and Article II, Section 4, Religious Freedom).

Douglas characterized the routing of educational aid through a charter school construct and via direct disbursement to the parents as a “sham” designed to “get around the plain language of the Colorado Constitution.”

[Judge Graham at this point asked, "Isn’t this program facially neutral?"  (When told "no" he followed with "can the court inquire as to nature of religious beliefs if the program is facially neutral?  Isn't that exactly what the trial court did?") . Graham questioned whether the trial court's reliance on “pervasiveness of indoctrination” for judgment  was constitutionally permissible.]

Douglas argued that the court “can & should” render judgment on this basis, that the trial court viewed “whether sectarian tenets are being taught, period” which he said is allowed under federal case law.

Douglas noted that the trial court found that funds for tuition does constitute “aid to schools” (impermissible under the Colorado Constitution, Article IX Section 7).

[Judge Jones interjected at this point that the same kind of program was found NOT to constitute "aid to schools" in the Zelman ruling.]

Douglas countered that if ANY of the schools in the program don’t “admit all” regardless of religion, then the entire program is discriminatory.

Attorney Michael McCarthy addressed the public school finance issues and School Finance Act for the Plaintiffs

McCarthy opened by asserting that the purpose and intent of constitutional and statutory provisions for public school finance is to “prevent depletion of public school finance resources” – arguing that the Douglas County School Choice Scholarship program “will gut public school finance in Colorado” and, if allowed to proceed, would grow beyond the initial limited scope and “operate to materially deplete financing available to public schools” not only in Douglas County, but throughout the state.

Judge Graham again raised the issue of standing, noting the absence of explicit language allowing individual standing in the School Finance Act and asking

if we allow standing in private citizens, aren’t we really allowing them to be substitute Boards of Education?”

McCarthy responded that “no express cause of action is needed – other avenues exist” and that ultimately, standing was predicated on the test established by Justice Rovira,

“did plaintiff incur injury in fact, related to a constitutional right?”

The majority of the remainder of McCarthy’s time was taken up with a discussion on whether or not funding was diverted to or from other school districts, and whether students leaving the Douglas County public schools constituted a net loss (in funding) to the district. (Judges Graham and Jones, in particular, seemed skeptical).

McCarthy concluded by proclaiming,

Choice isn’t the preeminent constitutional value in this case – or in this state.

He argued that the School Finance Act requires a specific spending formula, and that a transfer of 75% of the per-pupil funding to students attending private schools constitutes an “illegal transfer” since the private schools are ‘not public, not free & uniform, not subject to local control.”

 Oral arguments concluded with rebuttal by appellants’ attorney Eric Hall.

Hall noted that the trial court had ruled in favor of plaintiffs on Article IX Sections 2 and 15; however, Article IX Section 3 creates a “trust obligation” to school districts – which can spend funds as they like (within discretion).

Hall highlighted the absurdity of insisting that “public funds can ONLY be spent on public schools” -
if true, then NO expenditures to private entities (including contracting services on everything from janitorial to legal services) would be allowable.  School districts, he continued, “can and do buy services from private entities.”

Analysis:

Based on the body of evidence and argument presented at yesterday’s hearings and throughout the appeals process, the trial court’s ruling appears likely to be overturned, in whole or in part.  On the (admittedly esoteric) issue of standing to bring claims under the School Finance Act, it was clear that a majority (if not all) of the judges were skeptical at best, making it likely that those claims will be disallowed (rendering the trial court’s judgment in those areas moot).

On the core constitutional issues (respecting religious freedom and prohibiting public funds for support or sustaining of sectarian institutions), governing case law (from the 2002 U.S. Supreme Court Zelman case to the 1982 Colorado Supreme Court Americans United case and several others touched upon in filings and at argument) is clear that so long as the overall program is facially neutral (containing neither preferences for or against either secular or religious schools) and that school funds are spent in pursuit of education meeting secular criteria under local district control, the choice of individual students (parents) to attend schools with a religious component does NOT constitute “support” of the institution (nor, since the choice to attend a given school is left to individual program participants, does it “compel” sectarian attendance).

Moreover, since the program merely provides an additional choice among several options as an expansion to (not replacement of) the existing constitutionally mandated system of “free public education” and does not result in a net loss to the public system’s funding (indeed, it results in a 25% per-pupil surplus to the district), claims of damage under the School Finance Act lack justification.

The court’s ruling (to be issued “in due course”) will most likely be published in February or March of next year.

Since both sides in the case have signaled their intent to appeal if not satisfied with the verdict, the ultimate resolution of the case will fall to the Colorado Supreme Court – most likely (the wheels of justice grind slowly) in another year or more.

 Additional References:

For another analysis of yesterday’s oral arguments (with more emphasis on policy implications over legal issues), read Education Policy Analyst Ben DeGrow’s superb summary.

Click here for a comprehensive review of the Douglas County Choice Scholarship Program (including program information, video and audio interview and news clips, news and commentary highlights and links to many legal documents in the case)