Transcript from Washington Supreme Court Hearing on Order to Show Cause

Below is a partial transcript from the Supreme Court hearing in the McCleary case that took place on September 3, 2014.  The transcript covers only the second half of the hearing, in which the Court heard and asked questions on the issue of appropriate sanctions in the case.

 

Justice C. Johnson:

Let me express my concerns.  You’re getting a little bit out of what I perceive is my comfort zone.

In this case, we’ve got, I think, three essential powers, and one we’ve already exercised, in my view, and that is to declare what the Constitution requires and to give directions on how that constitutional obligation can be complied with.  We’ve already done that.

The second fundamental power that we generally exercise is that power to invalidate laws, and this is what I need you to respond to.  Mr. Copsey suggests, if we’re dissatisfied with what the legislative budget process results in next term, that we can come back and invalidate the budget, is what he suggested.  I want your response to that.

Thomas Ahearne:

It is one thing that even the State admits this Court unquestionably has the power to do:  invalidate unconstitutional laws.  That seems like a big invalidation, but I think if the question is, is it within your power, yes it is because it’s the paramount duty of the State to make ample provision for the education of all kids, and I can go through the whole litany of everything that’s been in this case.  The current budget doesn’t do it.  The next budget, most likely, isn’t going to do it.  So you can invalidate the budget.  You can do, for example, like Kansas and Arizona courts threatened to do, the order was stayed, or the New Jersey court actually did and say “Look, we have told you, time after time after time, that the school funding statutes in this state are unconstitutional.  We’re invalidating those statutes and, oh,  Legislature, since you haven’t fixed the problem, you tell parents why there’s no school in September.”  Now, the State does point out there was only one time, New Jersey, where the Legislature called the Supreme Court’s bluff and closed schools down for the first few days of the school year.  It just happens that the New Jersey school year starts on July 1, so they were closed, technically, for a few days.  And, of course, there was a special session called and then the Legislature actually complied with the law.  But, invalidating the law is one thing we agree this Court can do.  The thing that just might be a little uncomfortable here is this idea that we’re going to give this State another chance.  Let them delay a little bit longer.

Justice Gordon McCloud:

Counsel, what I heard today was different from the State and tell me if you heard it this way too.  In their briefs, they said that the Legislature’s 2015 actions would be the de facto complete plan and in the argument today I heard them say that this would be the revenue generating, or the revenue . . . finding the revenue would be the duty of the 2015 Legislature.  I never heard them say that about any of the previous legislative sessions.  That sounds different.  Does it sound different to you?

Ahearne:

What sounds different to me, frankly, I picked up the same thing in their briefs that “Hey guys, you’re going to have the plan next year, because whatever we don’t do in 2015 we’re going to have to do in 2017.  There, you’ve got it.”  What I heard differently today is they’re going to focus on revenue.  You know, “how are we going to get the money?”  The thing that I go back to is, remember the first time we had this argument, the trial court ordered, its affirmative injunction, its remedy was ordering the State to determine:  what’s the actual dollar costs of complying and how are you going to pay for it?  That was the order.  And the State appealed, saying “This is a waste of time, waste of money.  We’ve already done this.  We’ve already figured all of this out when we were doing 2261 and getting ready for 2776.  So, vacate that order.  We’ve already done it.”  This Court believed the State.  It vacated that part of the order.  And then today the State says, “well, you know, this is really hard, we have to figure out how to pay for it.”  That’s the thing I heard different, is that they’re now saying something different than they told the Court earlier to get that order vacated.  I mean, stop and think, if the order wasn’t vacated, we’d now be here with the State having determined and submitted:  this is what it costs and how we’re going to pay for it.

Justice Wiggins:

The Superintendent of Public Instruction proposes, contrary to your suggestion, that we do not hold them in contempt, that we do not impose any sanction, but at the end of the 2015 session, if the Legislature hasn’t come up with the money, that you propose to us any tax breaks or reductions in taxes that should be stricken down as unconstitutional in light of the inadequate school funding.  Your response to the Superintendent seemed to be negative, you didn’t like to do that, and I’m wondering why that is and why we shouldn’t put something in an order that says, if you don’t do this by the end of the session, here’s what’s going to happen.

Ahearne:

Our opposition isn’t to the idea that if you don’t do something, here’s something severe that will happen.  Our opposition is it turns this Court’s order on its head.  The State was ordered to do something and so if they don’t do something, Superintendent Dorn’s proposal is to impose on the plaintiffs the obligation to pursue injunction litigation to strike down various items on the budget.  It’s the State’s duty to submit this plan, and be making steady, real and measurable progress every single year.

Justice Stephens:

Procedurally, though, what’s the difference between the Superintendent’s proposal that we would strike any negative revenue-type bills and your proposal that we strike, or that we enjoin essentially anything that isn’t un- or unfunded mandate to a local district?

Ahearne:

I understood the Superintendent’s proposal to be slightly different in a significant way than ours.  I understood his proposal to be that plaintiffs can look at anything that was done in the budget that reduces general fund revenue, with the assumption that, well, if that gets stricken that revenue then will go to education.

Justice Stephens:

It all sounds like the Court writing a budget, frankly.  I guess the concern I have is not whether there’s a difference in what would be stricken but how is that any more of a requirement to proceed to an injunction than what you’re requesting, which seems like asking the court to exercise some injunctive jurisdiction and prohibit un- or underfunded mandates to local school districts, which is very different from compliance with a plan and a program that will be fully satisfied by 2018.

Ahearne:

Because that specifically addresses the harm that exists in this case, namely the schools being underfunded by the State in violation of the Constitution.  And if the 2015 session says “We’re not going to add funding and we’re not going to make any meaningful progress and that.  But we’re going to impose a bunch of mandates.  That’s how we’re going to improve schools, and we’re going to impose these mandates that actually cost a lot of money.”  That’s digging the hole deeper.  The purpose for that second one is “look guys, let’s at least preserve the status quo, the underfunding level where it is now, and you’re not allowed to dig that hole deeper by imposing unfunded mandates.”

Justice Owens:

Would an unfunded mandate be, let’s take an example like the Boeing tax break.  Let’s say a big company, a Microsoft decides to move to Chicago and so the Legislature creates a lot of incentives and tax exemptions for them to stay here.  Would that be something we could invalidate?  Is that the argument that I’m hearing?

Ahearne:

I think that’s the argument, and I don’t want to speak for the Superintendent, but my understanding is that’s the Superintendent’s argument because the giving away of the tax break or the loophole or whatever you want to call it, the incentive or whatever you want to call it, that’s reducing the general fund amount and that’s what the Superintendent would have plaintiffs try to come in and try to get it validated.  But that’s not an unfunded mandate.  An unfunded mandate would be something like “Schools, you now have to offer 10,090 hours of instruction, but not paying for it.”

Justice Owens:

But, we already have that in the legislation from the past don’t we?

Ahearne:

It’s 10,080. But if they now say “No, we’re going to make our schools better.  We’re going to require 10 more hours, but not pay for it.”  That’s an unfunded mandate.  That’s digging the hole deeper.

Justice Stephens:

Well, as long as you’re still in that inviting mode let me ask you a different question.  One of the Amicus argues that because we’re dealing here with a coordinate branch of government, in contrast to a private party who may also have difficulty coming up with the money to do a really big thing, that the only legitimate exercise of our authority would be like a writ of prohibition or a writ of mandamus.  I’d like to hear your response to whether that is the next step.

Ahearne:

I guess I agree that a writ of mandamus could be one thing to do, but what’s the difference between issuing something called a writ of mandamus ordering the Legislature to do something and, oh, the order you gave the Legislature in January of this year, the order you gave the Legislature in December of 2012.  They’re all court orders and I guess I don’t see why the Legislature would obey that one any more than it’s obeyed the prior ones.

Justice Stephens:

And I guess my question wasn’t going so much to the effect of “will it work” but to the constitutional footing on which either of those remedies would rest.

Ahearne:

I don’t see the constitutional difficulty, and I understand separation of powers is an issue, but I think the fundamental question on separation of powers is:  what is the purpose of separation of powers?  Is it to protect government officials who violate the constitutional rights of citizens? Or is it to protect the citizens whose constitutional rights are being violated?  As you know from our briefs, our position is there are separate powers and separate and independent branches because if one or two branches is violating citizens’ constitutional rights, there remains a third separate branch independent with the power to stop that violation.  That’s why the judiciary is an independent branch of government, not an irrelevant one, and not one that gives like just advisory suggestions.  You have the power to stop the violation.  That’s the purpose of separation of powers.  At least, as you know from our briefs, that’s our position.

If I can wrap up, because my yellow light, I think, has been on for a little while.

On timing, the Attorney General’s Office acknowledges the state Legislature did not comply with this Court’s order but wants you not to say the word contempt, and actually not say anything until maybe the middle of next year, and that argument makes sense if Article IX, Section 1 of our Constitution and the court orders in this case are like a John Grisham novel:  a good read, involves a lot of legal stuff, but it’s fiction.  Sure Article IX, Section 1 says “all children”, that’s fiction.  It says “ample provision”, that’s fiction.  It says “paramount duty”, that’s fiction.  Sure, this Court issued unequivocal orders in 2012 and 2014, telling the Legislature what to do, that’s fiction because, in reality, legislators are above the law.  Plaintiffs submit that no one is above the law, that Washington lawmakers should actually obey the law.  The court rulings in this case, the orders in this case aren’t fiction.  They’re the law of Washington.

And the thing with respect to timing that gets lost in all this is while all of us adults are talking about the State’s violation of its paramount duty, the kids, who have the corresponding paramount right, are growing up.  Carter McCleary’s mom was 13 when this Court issued the Seattle School District ruling and now she’s . . . a lot older.  Carter’s sister Kelsey was 13 when this lawsuit was filed, and now she’s out of high school and almost out of college.  These kids are growing up.  Carter was this cute little 7 year old kid in second grade when I first met him when we filed this lawsuit.  He’s now a young man in high school.  Every year, every day that we just keep talking about this, we’re losing kids.  They lose forever another year of their education.  That’s why we submit that the three-part order that we’ve proposed would be a firm, measured, deliberate response by this Court to start getting this constitutional provision and constitutional rights enforced.

Justice Madsen:

As a process matter, because it matters, if the Court were to follow the advice of the State and not take any action with regard to whether or not they are in contempt and wait for whatever product comes out of the 2015 Legislature, procedurally, would we need to have another show cause hearing because the State would then want to argue the new facts, with respect to contempt?  Is this just a pointless hearing if we take no action on the contempt itself?

Ahearne:

Silence is going to be action.  If this Court does nothing, the Legislature knows it can violate the court order once, twice, whatever.  And we’ll all be here again next summer.  By then it’s going to be too late, by the way, to do anything about the 15-16 school year.  So we’re going to let another school year go away.  I agree that it does make sense for the public to know how the Court operates and what these things are and I do agree that there would have to be a show cause.  It would make sense to have a show cause hearing just when everything is out in the open.  I don’t think it’s necessary, I think it can be done on the briefs, but as much as I . . . I think that’s good for the process.

The last point is, it brings up another one of the banners that are out there, that talks about the Court’s . . . and justice without delay and kicking this can down the road another year is just more delay.

Alan Copsey:

The proper focus of the show cause proceeding is to coerce compliance with the Court’s order in January of ‘14, January 2014.  That order was to produce a plan.  When we talk about remedies, where we’ve moved in our discussion of remedies is talking about the ultimate issue, the ultimate issue being how to get the State in ultimate compliance by 2018.  I don’t believe that contempt is the right vehicle to do that.  The proper remedy for contempt: address the planning order.  You are operating in this case under your retained jurisdiction.  To my knowledge, it’s the first time this Court has ever retained jurisdiction in a case, and so the actual parameters of the Court’s authority, under its retained jurisdiction, are yet to be explored.

Justice Gordon McCloud:

What will coerce compliance more than a finding of contempt?  Silence about whether the Legislature is in contempt?

Copsey:

No, your honor, respectfully, we’ve never suggested that the Court remain silent, we have never suggested that.  But what we are suggesting is that the entire Constitution matters, and for the Court to, for example, prospectively invalidate legislation that hasn’t even been enacted yet would be to exceed the Court’s power under the Constitution.

Justice Gordon McCloud:

So what’s your position on what would most coerce compliance?

Copsey:

I think it’s a mistake to say that the Court has not been successful at attracting the Legislature’s attention.   I think the Court deserves applause for the visibility it’s created for the issue of school funding.  In that sense, this Court’s orders over these last couple of years have been remarkably successful.  The fact that we have this sort of a full courtroom with media presence indicates how visible the issue has become.  It’s not necessary to order the Legislature of the State to be in contempt in order to further promote progress.  Our concern is that if the Court pushes in that direction, it can inhibit progress.  The Legislature has a very difficult decision to make about funding:  will it seek new revenue or will it make cuts in other programs.  If the Court purports to guide that process in one direction or the other, it runs the risk of entering into the legislative sphere.

Justice C. Johnson:

Counsel, someone suggested . . . you represent that this is a revenue-side solution.  In one of the briefs, it was suggested, at least, that this is not revenue . . . as much of a revenue problem as it is an exemption problem, and a failure to act within the authority that the Legislature already has.   In one of the briefs, it cited to an article that establishes that in the Legislature, over many many years, has created somewhere upwards of 600 separate either tax exemptions or reduced tax rates on certain activities or businesses.  As a matter of fact, since McCleary, the Legislature has enacted more exemptions to, I guess in effect, reduce the revenue that you seem to focus your argument on.  And, as far as prospective invalidation, one of the powers this Court has to exercise, what would be wrong, I guess, with this Court doing a prospective invalidation of every exemption that’s on the books, that really, if his briefing is correct, upwards of 30 billion dollars, leaving it up to the Legislature to reenact each and every one of them if they should so choose, but only after they fully fund the primary responsibility this Court has already established?  I see that as a more practical solution than, sometime after the Legislature fails or ends its session, for the parties to come back and ask us to invalidate the budget.  That just doesn’t seem like a proper remedy.

Copsey:

What you propose would certainly be an efficient remedy.  But I’m not convinced that it’s a constitutional remedy.  Article VII, Section 5 rests taxation, the power of taxation, solely in the Legislature, not in the Court, and for the Court to prospectively invalidate every tax cut would be for the Court to enter into the realm of deciding taxation.  The decision by the Legislature to impose a tax or to offer an exemption are both the Court’s exercise of the power of taxation, negative and positive powers.  But they’re both powers of taxation.  They’re powers that are constitutionally delegated exclusively to the Legislature and the Court, I believe, would be violating both Article VII, section 5 and the doctrine of separation of powers were it to prospectively invalidate legislation that has not even been enacted yet, especially tax legislation.

Justice Yu:

Counsel, I’d like to get back to the question that was posed by Justice Gordon MacLeod and that is, short of doing nothing and entering an order of contempt, what else, what other options does this Court have?  I mean, you’re asking for a political accommodation, that’s what you’re asking for so short of doing nothing, what can this Court do?

Copsey:

Again, respectfully, what we’re really asking for is a constitutional accommodation to the political branch of government, and that’s very different than asking for a political accommodation.  As I was saying earlier, we’ve suggested three options and two of those options would involve an order now.  One would be an order to come up with a particular amount of spending.  A second would be an order warning the Legislature that all or part of its budget could be invalidated if it doesn’t meet its constitutional obligation.  As I also indicated, neither one of those solutions is problem-free.  If we’re going to look for a solution that’s constitutional, that has a reasonable or a better than reasonable prospect of success, we think you can speak harshly to the Legislature, you can tell them you’re really serious, you’ve already done that, it didn’t result in a plan.  But the Legislature has told you, unambiguously, that it understands the seriousness of the 2015 session.  It’s called it a critical year.  It knows that.  It’s indicated that to you.  I think it deserves the Court’s respect to give it a chance to follow through on that commitment that it’s made.

Justice Yu:

So, procedurally though, here we are today on a show cause hearing.  Would the option be just to continue the hearing to the extent that we hold it open and give the Legislature a chance?  I’m really searching.  What are the possibilities?

Copsey:

That would be a potential remedy and the reason I would agree with that remedy is because I think the appropriate authority for addressing the funding issue is the Court’s retained jurisdiction, not contempt.  Presumably, if the Legislature were to succeed at making a bold attempt, bold legislation in 2015, there would be no need for the Court, then, to find the Legislature in contempt for the failure to have adopted a plan in 2014.  You could leave it open with a sanction hanging in the event that nothing happens in 2015.  But I think the proper authority is your retained jurisdiction.  That’s the issue in this case that is, at the core, is the funding by 2018.

Justice Madsen:

Thank you, counsel.  The Court is in recess.