Gannon v. State, 113267

Background

Plaintiffs (Gannon and school districts) sued in 2010 alleging Kansas violated Article 6 of the Kansas Constitution by inadequately and inequitably funding K–12 public education; multiple panels and this Court previously found constitutional violations and stayed mandates to allow legislative fixes.
The legislature enacted Senate Bill 19 (S.B. 19) in 2017 (Kansas School Equity and Enhancement Act) to replace CLASS and modify funding: set a BASE per-pupil amount, adjusted at-risk weighting, preserved LOB and capital outlay mills, and expanded permitted capital outlay uses.
The State bore the burden to demonstrate S.B. 19’s structure and implementation are reasonably calculated to meet the Rose standards (codified in K.S.A. 72-1127) and to provide reasonably equal access through similar tax effort.
The State relied on a short KLRD “successful schools” cost analysis to justify BASE and overall funding increases; plaintiffs countered with historical cost studies (A&M, LPA), KSDE projections, and performance data showing many students remain below grade level.
The Court found S.B. 19 deficient both on adequacy (insufficient demonstrated funding to meet Rose standards; flawed cost methodology and unsupported choices) and on equity (several provisions exacerbate wealth-based disparities).

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Adequacy of S.B. 19 funding	S.B.19 does not provide funding reasonably calculated to have all students meet Rose standards; State's cost model is unreliable and understates need	S.B.19 increases BASE and at-risk funding; KLRD "successful schools" model and LPA adjustments justify funding	State failed to meet its burden — S.B.19 not shown to be reasonably calculated to meet Rose standards (inadequate implementation)
Use and equalization of capital outlay funds	Expanding capital outlay uses (insurance, utilities) ties fund to basic operations and worsens wealth-based disparities because capital outlay equalization is weaker	Expansion applies uniformly and equalization formula remains unchanged; no change in tax effort	Expansion exacerbates inequities; violates Article 6 equity requirement
Local Option Budget (LOB) access procedures	Grandfathering some districts at higher LOB caps and reinstating protest/election procedures for others creates unequal access tied to district wealth and past timing	Legislative choices promote predictability and protect prior actions; elections are democratic	Reinstated protest/election process and grandfathering produce unequal, unconstitutional access; State failed burden on equity
LOB equalization (lookback)	Using prior-year LOB percentage to compute supplemental state aid withholds equalization for districts that raise LOB now, harming property-poor districts	Lookback increases predictability and avoids timing/valuation uncertainties for budgeting	Lookback provision widens wealth-based disparity and violates Article 6 equity
At-risk funding floor (10% minimum)	A 10% floor benefits only two wealthy districts (adds ~$2M) and is a wealth-based carve-out that harms equity; no cost-based justification provided	Floor helps districts where free-lunch proxy undercounts at-risk students; small, reasonable policy choice	Floor unjustified and inequitable on this record; State failed to justify it under Article 6

Key Cases Cited

Rose v. Council for Better Educ., Inc., 790 S.W.2d 186 (Ky. 1989) (establishes minimum education adequacy capacities used as the constitutional benchmark)
Gannon v. State, 298 Kan. 1107 (Kan. 2014) (Gannon I) (adopts Rose-based adequacy test and equity standard for Article 6)
Gannon v. State, 305 Kan. 850 (Kan. 2017) (Gannon IV) (affirming CLASS unconstitutional; reiterates State's burden to show legislative remedy meets adequacy and equity)
Montoy v. State, 282 Kan. 9 (Kan. 2006) (Montoy IV) (discusses remedial legislative compliance and prior substantial compliance determinations)
U.S.D. No. 229 v. State, 256 Kan. 232 (Kan. 1994) (upholding original SDFQPA structure and examining statutory components of school finance)