Sweetwater County Planning Committee for the Organization of School Districts v. Hinkle

McINTYRE, Chief Justice.

Pursuant to the provisions of the Wyoming School District Organization Law of 1969, the county committee of Sweetwater County (county planning committee for the organization of school districts) held a series of meetings throughout Sweetwater County in connection with the formation of unified school districts. Negotiations were also entered into with the county committee of Carbon County.

The plan finally adopted for Sweetwater County by its county committee was for three separate unified school districts. According to the plan, School District No. 25 (Bairoil) was to be joined with areas which included Rock Springs and Wamsut-ter and made into unified District No. 1 (new). School administrators and citizens of the Bairoil area consistently opposed joinder of the Bairoil district with any Sweetwater County school district.

When the Sweetwater plan was submitted to the state committee (state committee for organization), that committee recommended the Carbon County and Sweetwater County committees meet and attempt to work out a cooperative arrangement with respect to the Bairoil school and students. This was done and the Sweet-water plan was modified to provide that the new unified District No. 1 would contract with the Rawlins school system. Under such contract, District No. 1 would pay the actual cost to the Rawlins system to run the Bairoil school system. The actual cost figure for the first year was to be $208,000.

The state committee ultimately approved the modified plan. However, citizens and taxpayers of the original Bairoil district appealed to the district court from the approval decision of the state committee. That court held Bairoil had not been included in the organization of unified District No. 1 as a part of any efficient administrative unit, with primary consideration to the education, convenience and welfare of the children.

The court reasoned that the contractual arrangement between the two county committees was not efficient or practical because there was no assurance school administrators charged with the responsibility of educating Bairoil students could or would do so for the figure agreed upon. Also, future boards of the two districts involved would not be bound and there would be continual haggling over the amount to be paid for the education of Bairoil students.

The court stated a satisfactory solution would possibly be that the Bairoil district should be a part of the adjoining Carbon County district which includes Rawlins. The court concluded, the Sweetwater committee was arbitrary in refusing to consider the full joinder of Bairoil with the Rawlins district. The case was remanded by the district court to the state committee with instructions to reject the plan of organization devised by the county committee of Sweetwater County.

At the district court level, the Sweet-water county committee was permitted to intervene. It has brought the matter to us by appeal from the judgment of the district court.

The controversy in this case centers around the fact that Bairoil is an isolated *1236school district located m the northeastern corner of Sweetwater County. It is set apart from the rest of the county because of a lack of roads, geographical barriers and distances to Sweetwater County population centers. It is about 40 miles from Rawlins and 150 miles from Rock Springs. The only feasible route to Rock Springs is through Rawlins. Rawlins is the trade center of the Bairoil community.

With only minimal exceptions, all of the Bairoil grade school graduates have attended Rawlins High School. The curriculum of the Bairoil grade schools is based on the curriculum of the Rawlins system, because the students go into the Raw-lins high school system. The Rawlins school system also furnishes to Bairoil other educational services, such as psychologist, health care, and the like. In addition, Bairoil carries on its athletic events with schools in Rawlins, Baggs, Medicine Bow and some schools in Fremont and Natrona Counties which are closer than Rock Springs.

In the past there has been very little, if any, association with the schools of Sweet-water County. The Bairoil school system has in the past paid the Carbon County system for educational services. The trial judge considered that the Bairoil district would not be benefited by being consolidated with other Sweetwater County districts because substantially all educational services would be supplied by the adjoining district in Carbon County, even though paid for by the new unified district in Sweet-water County.

Districts adjacent to the Bairoil district are naturally eager to be consolidated with Bairoil because of the assessed valuation of property within the Bairoil district. The assessed valuation of such district is $16,997,373.00, amounting to $320,705 per pupil. This is accounted for because of its location in the Lost Soldier oil field. Bairoil has the highest valuation per student in Sweetwater County, and for that matter in the entire state.1

We cannot avoid being aware that the matter before us has been and is difficult of solution because a tax advantage is to be had by being in a school district where the assessed valuation is high. If ad valorem taxes for school purposes were equalized throughout the state, as required by Art. 1, *1237§ 28, Wyoming Constitution, and by the equal protection clause of the Fourteenth Amendment to the United-States Constitution,2 cases such as the one being dealt with would not arise.

The time has come when we can no longer ignore inequalities throughout our state in the matter of taxation for school purposes. Taking judicial notice of official reports of the state department of education, which we are privileged to do, we are made aware that this inequality ranges from a situation where in the Bairoil district a levy of one mill will bring in $351 per pupil, while in the Star Valley district (Lincoln County) a levy of one mill will bring in $4.70 per pupil.

We are attaching as an appendix to this opinion a Property Tax Report for Unified School Districts (1971-1972), prepared by Management Information Services, Planning and Development Division, State Department of Education. . The primary concern of this report is to provide information relating to property valuation and the taxes assessed on property for school revenues. Facts and figures contained in this report show much disparity in school ad valorem taxes which are being paid by taxpayers throughout the state.

It will be seen from these figures that affluent districts can provide a high quality education for their children while paying lower taxes. Poorer districts, by contrast, do not have that advantage. The inequality is obvious.

Sweetwater County is large in area, containing in excess of 10,000 square miles. In some of the areas the principal source1 of assessed valuation is from the extractive mineral industry. New developments are taking place, and some areas which previously produced have or will become depleted. Thus, there is a constant changing of assessed valuations for given areas. Even if the pupil assessed valuations were fairly well equalized within a multiple-district county, it could — and probably would — materially change from year to year, which would require a constant changing or even gerrymandering of properties from one district to another.

Needed Legislation

We see no manner in which ad valorem taxes for school purposes can be made equal and uniform unless it is done on a state-wide basis. In other words, all property owners within the state should be required to pay the same total mill levy for school purposes.

Art. 15, § 17, Wyoming Constitution, provides there shall be levied each year in each county a tax of 12 mills on the dollar for the support and maintenance of public schools. This tax is collected by the county treasurer and disbursed among the school districts “within the county.” Inasmuch as this levy is mandatory and a constitutional requirement, it will necessarily continue.

Art. 15, § 15, Wyoming Constitution, authorizes a state tax not exceeding six mills on the dollar to be levied each year for support of public schools in the state. There is no need for any change in what is being done with respect to the levy of this tax and the distribution of funds derived from such levy.

While we do not mean to encroach upon prerogatives of the legislature, we think it might be helpful if we would suggest a possible method by which equal and uniform taxes can be accomplished for school purposes. In doing so, we exclude from our consideration funds derived from the six-mill state levy; funds from motor vehicle fees; funds from fines and forfeitures; Forest Reserve funds; Land Income funds; Taylor Grazing funds; and all State or Federal funds or other funds not derived from ad valorem taxes levied at the county level.

The legislature would need to provide for determination of the total amount of school funds which must be derived from ad *1238valorem taxes at the county level, exclusive of funds listed in the preceding paragraph, for each classroom unit as defined in § 21.1-228, W.S.1957, 1971 Cum.Supp. When the amount per classroom unit is multiplied by the number of classroom units in the state, a total for the state (of the funds we are considering) will be known. It can then be determined each year what mill levy would be necessary, when applied to all assessed property in the state, to produce the total for the state (of the funds we are considering).

Each year the state department of education would need to notify the county commissioners in each county what mill levy must be levied, in addition to the county 12-mill levy provided"for in Art. 15, § 17. Funds derived from the additional levy (exclusive of those from the 12-mill county levy) would need to be transmitted by each county treasurer to the state treasurer. The state department of education would then need to notify the state treasurer what proportion of thes'e funds must go to each school district in the statejn order that each district will receive the same share per classroom unit, when its allotment from the countywide 12-mill school levy and its additional allotment from the state treasurer are added together.

Although we have been referring in this opinion to a “classroom unit” as the unit of measurement for a district’s share in funds, we do not mean to imply that a different unit of measurement may not be adopted at any time in the future.

We have been speaking only about the operation and maintenance of public schools and not about the financing of capital improvements. Such financing will in the future have to be done by each school dis-. trict separately, unless and until otherwise authorized. No invidious discrimination will be involved if bonds are voted by any school district for capital improvements, and if special levies are made within the district to retire such bonds.

Also, we will not consider any invidious discrimination involved if the legislature sees fit to permit local initiative within any district, for expenditures other than for capital improvements, to the extent of 10 per cent or 15 per cent of the level of income guaranteed for the district by the state in any year.

In making the suggestions we have set out concerning needed legislation, we have been considerably influenced by the decision of the California Supreme Court in Serrano v. Priest, 5 Cal.3d 584, 96 Cal.Rptr. 601, 487 P.2d 1241. We cite it as authority for our conclusions in this case.

The Sweetwater Problem

The trial judge, as we understand his decision, has made it quite clear he considers there is no solution to the Bairoil problem if the Bairoil district has to be consolidated into a unified district which is an efficient administrative unit, and if the consolidation is confined to the boundaries of Sweetwater County. As previously stated, the judge suggested a satisfactory solution would possibly be for the Bairoil district to become a part of the Rawlins (Carbon County) district. He also held the Sweetwater county committee was completely arbitrary for not considering this possibility.

Counsel for the county committee of Sweetwater County argues that county committees of two counties could, up to December 1, 1971, mutually agree on the crossing of county lines in the forming of a unified district.3 He claims, however, the state committee, after December 1, 1971, has no authority or power to effect a unification where county lines are crossed. Such power is claimed on behalf of the state committee under § 21.1-113, W.S.1957, 1971 Cum.Supp.

It is true § 21.1-113.does provide, if an approved plan has not been filed for “any territory” in any county or counties, by December 1, 1971, the state committee is authorized to reorganize “such territory” into a unified school district. As far as we know, however, the only controversial terri*1239tory involved in the unapproved plan, as far as this case is concerned, is the territory which the Sweetwater County committee intended to become unified District No. 1, all of which is in Sweetwater County. We assume the adjacent territory in Carbon County was a part of a unified district as of December 1, 1971.

Moreover, the 12-mill school levy mandated by Art. IS, § 17, of the constitution must be disbursed among the school districts “within the county.” This levy produces considerable revenue from Bairoil. It would be difficult to keep it all within Sweetwater County, if Bairoil was consolidated with a Carbon County district. Or, if it was kept in Sweetwater County, Rawlins’ reason for wanting to be consolidated with Bairoil would be largely gone.

Be that as it may, the district court ordered the state committee to reject the plan of organization devised by the county committee of Sweetwater County. We are informed the court’s order has been carried out, and apparently the districts of Sweet-water County are now as they were immediately prior to the time when the state committee approved the county committee’s plan for unification.

We are going to retain jurisdiction of this case until the legislature has met and thereafter adjourned in 1973. Until adjournment of the legislature in 1973, or until further order of this court, we direct that all districts in Sweetwater County shall operate and remain as they were immediately before the state committee approved the county committee’s plan for unification.

If the legislature undertakes to equalize ad valorem taxes for school purposes on a statewide basis, and we expect it to do so, we suggest it give consideration to clarifying § 21.1-113 in light of what we have said about the section.

We think of two possible solutions. First, unification can be restricted within the respective counties, with provisions for payment of tuition or costs when it is more convenient for children to attend school in another county. Second, there can be no objection to the organization of a unified school district involving territory in two or more counties, providing proper arrangements are made for prorating the 12-mill county levy prescribed by the constitution, in keeping with the provisions of Art. 15, § 17. Such prorating will be facilitated if and when legislation is adopted which will equalize ad valorem taxes for schools on a statewide basis.

Existing Debts

School District No. 25 (Bairoil) has a bonded indebtedness of some $97,000. The indebtedness in other areas of the proposed unified District No. 1 amounts to $2,622,000. Thus, the proposed unification would cause the mill levy on property in the Bairoil area to be increased to help pay off the indebtedness of the Rock Springs and Wamsutter areas.

The residents of Bairoil complain this would cause an additional debt on them without their having voted for it. This, they say, is contrary to Art. 16, § 4, Wyoming Constitution, which specifies:

“No debt in excess of the taxes for the current year shall, in any manner, be created by any county or sub-division thereof * * * unless the proposition to create such debt shall have been submitted to a vote of the people thereof and by them approved.”

No doubt the constitutionality of debt spreading in connection with unification in Sweetwater County will in due time have to be settled. As far as the instant case is concerned, however, it does not need to be settled at this time. We say that because we are retaining jurisdiction of this case, and in the meantime debt spreading is not a problem since the districts are as they previously were.

At the same time we heard oral argument for this case, we also heard oral argument for a similar case, Lund v. Robert G. Schrader, State Superintendent of Public Instruction, No. 3995 (Johnson County). In that case we will have to decide the constitutionality of those provisions in the school district organization law which provide for an equitable allocation of the assets and *1240debts of districts affected by any plan of organization.

Our decision in the Johnson County case will serve as a caveat for the question of debt spreading in this case, if and when a final unification is effected involving Bair-oil. In view of this, nothing more needs to be said on the subject at this time.

Jurisdiction retained for final decision after the next regular session of the legislature and for whatever further orders or disposition may be necessary in the meantime.

. When the county committee commenced deliberations in connection with a plan of unification for Sweetwater County, there were six school districts in the county. Their enrollment and assessed valuations were as follows:

. Art. 1, § 28, Wyoming Constitution, provides all taxation shall be equal and uniform. Amendment XIV, United States Constitution, provides no state shall deny to any person within its jurisdiction 'the equal protection of the laws.

. See § 21.1-118(a), W.S.1957, 1971 Cum.Supi).