Serrano v. Priest

In the case of Serrano v. Priest, 487 P. 2d 1241 (S.Ct. California, 1971), the plaintiff sued contending that the California system of funding public schools violated the Fourteenth Amendment to the U.S. Constitution. The complaint alleged (a) the quality of a child's education was a function of the property wealth where the child lives, (b) the quality of the education was a function of the geography depending on the district where the child resides, (c) the educational needs were not taken into account because generally poor children have greater and more costly educational needs, and (d) the inequitable apportionment of state resources creates great disparities in educational quality.

In 1968–1969, 55.7% of California's school revenues came from local property taxes, 35.5% from state sources, 6.1% from federal sources, and 2.7% from miscellaneous funds. Since the majority of funding came from local property [Page 813]taxes, the amount of revenue generated from property taxes depended on the property wealth of the district. In 1969–1970, the property wealth or assessed valuation per student ranged from a low of $103 per pupil in the poorest district to $952,156 in the wealthiest district. This was a ratio of approximately 10,000 to 1.

The court rejected the plaintiff's argument that the school finance system violated the California state constitution. The court stated “we reject … [the] argument that the provision in Section 5 [California State Constitution] for a ‘system of common schools’ requires uniform educational expenditures.”

The court then addressed the issue of whether the financing program violated the Fourteenth Amendment of the U.S. Constitution by questioning whether wealth was a suspect classification. The court stated, “Plaintiffs contend that the school financing system classifies on the basis of wealth. We find this proposition irrefutable.” Therefore, the court found that funding formulae discriminated against children living in property-poor districts since these districts had a high dependence on local property taxes. There were great funding disparities among school districts and, since the California court declared education a fundamental interest, the state was compelled, under strict judicial scrutiny, to justify the method of public school financing in California. In 1973, the U.S. Supreme Court would reject the argument that wealth is a suspect classification, thereby requiring only a rationale basis for distributing educational financing and not the strict scrutiny where the state would be required to show a compelling reason for justifying the distribution of school funds (San Antonio Independent School District v. Rodriquez, 411 U.S. 1 93 S. Ct. 1278, 1973).

Although the Serrano decision, with respect to the Fourteenth Amendment to the U.S. Constitution, was reversed by the Court in Rodriquez, the Serrano decision was the beginning of school finance litigation. After the Rodriquez case plaintiffs challenged school finance funding under the state constitution provisions.