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10/23/97 CONCEPCION NOYOLA ET AL. v. BOARD

October 23, 1997

CONCEPCION NOYOLA ET AL., APPELLEES,
v.
THE BOARD OF EDUCATION OF THE CITY OF CHICAGO ET AL., APPELLANTS.



Appeal from the Appellate Court, First District of Cook County. Case Numbers: AC1-93-3814, TR88CH10571. Hon. Albert Green, Trial Judge. Appeal from the Appellate Court, First District of Cook County. Case Numbers: AC1-93-3814, TR88CH10571. Hon. Albert Green, Trial Judge.

The Honorable Justice Harrison delivered the opinion of the court. Justice Miller, dissenting. Justice Bilandic, also dissenting.

The opinion of the court was delivered by: Harrison

The Honorable Justice HARRISON delivered the opinion of the court:

The issue in this appeal is whether plaintiffs, who are the parents of economically disadvantaged Chicago school students and a community advocacy group whose members include the parents of such students, have the right to bring an action challenging the manner in which the board of education of the City of Chicago and the Illinois State Board of Education allocate Chapter 1 funds under section 18-8(A)(5)(i)(1)(a) of the School Code (105 ILCS 5/18-8(A)(5)(i)(1)(a) (West 1994)).

The circuit court initially dismissed plaintiffs' claims for lack of standing, but the appellate court reversed and remanded. Noyola v. Board of Education, 227 Ill. App. 3d 429, 169 Ill. Dec. 678, 592 N.E.2d 165 (1992). On remand, plaintiffs filed a second amended complaint alleging that defendants are violating the provisions of section 18-8(A)(5)(i)(1)(a) of the School Code in two ways. The first is by diverting Chapter 1 funds that should be spent at "attendance centers," i.e., schools, and using them instead for administrative and overhead costs. The second is by using Chapter 1 funds to supplant rather than supplement the resources necessary to meet the educational needs of economically disadvantaged students.

Plaintiffs contend that as a result of defendants' unlawful use of Chapter 1 funds, economically disadvantaged Chicago school students have been deprived of adequate educational opportunities in violation of their statutory and constitutional rights. They also assert that defendants' actions violate the requirements of the Illinois Administrative Procedure Act (5 ILCS 100/1-1 et seq. (West 1994)). For their relief, plaintiffs request a determination that defendants have violated the law and an order requiring defendants to use Chapter 1 funds as section 18-8(A)(5)(i)(1)(a) of the School Code requires.

On defendants' motions, the circuit court dismissed plaintiffs' second amended complaint. The court took issue with the sufficiency of plaintiffs' factual allegations, but the primary basis for its decision was its belief that a private right of action to enforce section 18-8(A)(5)(i)(1)(a) could not be implied under the School Code.

The appellate affirmed in part and reversed in part and remanded. 284 Ill. App. 3d 128, 671 N.E.2d 802, 219 Ill. Dec. 635. It held that the constitutional claims asserted by plaintiffs were factually and legally insufficient. It also held that plaintiffs had abandoned their claim that defendants' actions violated the Illinois Administrative Procedure Act. Where the appellate court disagreed with the circuit court was on the question of whether plaintiffs could assert a private right of action to enforce section 18-8(A)(5)(i)(1)(a). In the appellate court's view, a private right of action could be implied under the statute, plaintiffs were proper parties to bring such an action, and the facts pled by plaintiffs were sufficient to withstand defendants' motions to dismiss. Accordingly, the appellate court reversed the circuit court's judgment dismissing plaintiffs' claim to enforce the statute and remanded for further proceedings with respect to that claim. Defendants filed two separate petitions for leave to appeal (155 Ill. 2d R. 315), which we consolidated and allowed.

In reviewing the appellate court's judgment, we begin with a discussion of section 18-8(A)(5)(i)(1)(a) of the School Code, the statute on which plaintiffs' cause of action is founded. Under Illinois law, school districts receive distributions of general state aid from the state's common school fund. The formula for calculating how much general state aid a district will receive is set forth in section 18-8 of the School Code. That formula is designed to enable districts with modest property tax bases to achieve a certain minimum level of funding per pupil. Committee for Educational Rights v. Edgar, 174 Ill. 2d 1, 6-7, 220 Ill. Dec. 166, 672 N.E.2d 1178 (1996).

The amount of general state aid a district receives is based on a weighted average of daily attendance at schools within the district and on the equalized assessed valuation of property in the district. A district's weighted average daily attendance is increased by the number of low-income eligible pupils it has. 105 ILCS 5/18-8(A)(1)(n) (West 1994). Correspondingly, the presence of low-income eligible pupils will increase the amount of general state aid a district receives, all else being equal. The additional general state aid monies a district receives due to the presence of low income eligible pupils are known as Chapter 1 funds. 23 Ill. Adm. Code ยง 202.10 (1997); 105 ILCS 5/18-8(A)(5)(i)(1)(a).

Detailed requirements govern how school districts with an average daily attendance of 50,000 or more may expend Chapter 1 funds. Those requirements are set forth in section 18-8(A)(5)(i)(1)(a) of the School Code. Under that statute, school districts are required to distribute all Chapter 1 funds "to attendance centers and only to attendance centers," subject to certain limitations. 105 ILCS 5/18-8(A)(5)(i)(1)(a) (West 1994). This requirement was implemented by the General Assembly in phases, beginning with the 1989-90 school year. It is now in full effect.

Underlying section 18-8(A)(5)(i)(1)(a) is the principle that Chapter 1 funds should benefit the low-income students responsible for bringing those funds into the district. Consistent with this purpose, the statute specifies that the funds must be distributed to attendance centers in proportion to the number of students enrolled at the centers who are eligible to receive free or reduced price lunches or breakfasts under the Federal Child Nutrition Act and the National School Lunch Act. The statute further specifies that the appropriations an attendance center would otherwise receive cannot be reduced or adjusted to offset a distribution of Chapter 1 funds. Under the law, Chapter 1 funds must supplement rather than supplant other appropriations. 105 ILCS 5/18-8(A)(5)(i)(1)(c) (West 1994).

To insure compliance with the foregoing requirements, school districts must prepare annual plans and submit them for approval to the State Board of Education. If they fail to do so, the State Board of Education is required to withhold their Chapter 1 funding. In addition, once Chapter 1 funds have been distributed to a district, the district must prepare and submit a report to the State Board of Education showing how the funds were expended. 105 ILCS 5/18-8(A)(5)(i)(1)(d) (West 1994). The law directs the State Board of Education to promulgate rules and regulations to implement these requirements.

The Chicago Board of Education is subject to the provisions of section 18-8(A)(5)(i)(1). In the complaint at issue in this case, plaintiffs allege that the Board has violated the statute by using Chapter 1 funds for administrative and overhead costs instead of distributing those funds to eligible attendance centers. Plaintiffs further allege that the Board has also violated the statute by using Chapter 1 funds to supplant, rather than supplement, funds that would otherwise be allocated to the attendance centers. According to the complaint, the Board has done so, ...


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