Adair v. State

760 N.W.2d 544, 279 Mich. App. 507
CourtMichigan Court of Appeals
DecidedJuly 3, 2008
DocketDocket 230858
StatusPublished
Cited by9 cases

This text of 760 N.W.2d 544 (Adair v. State) is published on Counsel Stack Legal Research, covering Michigan Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Adair v. State, 760 N.W.2d 544, 279 Mich. App. 507 (Mich. Ct. App. 2008).

Opinion

ON SECOND REMAND

Before: SAAD, C.J., and TALBOT and FORT HOOD, JJ.

TALBOT, J.

By prior order, we appointed a special master to hear the remaining claims in this school-financing case brought under § 29 of the Headlee Amendment, Const 1963, art 9, §§ 25-34. We charged the special master with the task of determining whether the record-keeping obligations imposed on plaintiff school districts as a result of MCL 388.1752 and Executive Order No. 2000-9 constituted either a new activity or service or an increase in the level of state-mandated activity or service within the meaning of the Headlee Amendment’s prohibition of unfunded mandates. The special master has concluded that the state violated the second sentence of § 29, more commonly referred to as the “prohibition on unfunded mandates” or POUM clause, because the record-keeping obligations imposed by the state on the school districts require the districts to actively participate in collecting, maintaining, and reporting data that the state requires for its own purposes only. We have reviewed the extensive evidentiary record created by the special master and the parties, the briefs, and the report of the special master. We adopt the conclusions of *511 law and factual findings of the special master, with the modifications detailed below. Accordingly, we enter a declaratory judgment in favor of plaintiffs. We deny the state’s motion for summary disposition in all but one regard.

BURDEN OF PROOF

To establish a violation of the POUM clause, a plaintiff “must show that the state-mandated local activity was originated without sufficient state funding after the Headlee Amendment was adopted or, if properly funded initially, that the mandated local role was increased by the state without state funding for the necessary increased costs.” Adair v Michigan, 470 Mich 105, 111; 680 NW2d 386 (2004). The state argues that plaintiff school districts must prove, as an essential element of their claim under the POUM clause, that the implementation of the mandates required the districts to actually incur specific costs, i.e., out-of-pocket expenses in a quantified amount. We reject the state’s position, as did the special master, albeit for reasons other than those advanced by the special master.

This Court has twice ruled, at different stages of the same action, that the plaintiff school districts in a Headlee challenge establish “a prima facie case by showing the actual costs to all the school districts for each of the mandated services.” Durant v Dep’t of Ed (After Remand, On Third Remand), 213 Mich App 500, 503; 541 NW2d 278 (1995), aff'd in part sub nom Durant v Michigan, 456 Mich 175 (1997), reconsideration den and lv den 456 Mich 924 (1998); Durant v Dep’t of Ed (On Third Remand), 203 Mich App 507, 514; 513 NW2d 195 (1994). Likewise, our Supreme Court has recognized the need to determine with specificity the amount of necessary costs incurred for a mandated *512 activity, including whether such costs fall within the de minimis exclusion of MCL 21.232(4). Oakland Co v Michigan, 456 Mich 144, 165; 566 NW2d 616 (1997) (Opinion by KELLY, J.) (cost of county foster-care services).

Unlike the present action, both the Durant and Oakland Co actions presented challenges brought pursuant to the first sentence of § 29 of the Headlee Amendment, which is also referred to as the “maintenance of support” or MOS clause. Adair, 470 Mich at 111; Oakland Co, 456 Mich at 149 (Opinion by KELLY, J.); Durant v State Bd of Ed, 424 Mich 364, 378-379; 381 NW2d 662 (1985). The MOS clause provides: “The state is hereby prohibited from reducing the state financed proportion of the necessary costs of any existing activity or service required of units of Local Government by state law.” Const 1963, art 9, § 29. “[T]o establish a Headlee violation under the MOS clause, the plaintiff must show ‘(1) that there is a continuing state mandate, (2) that the state actually funded the mandated activity at a certain proportion of necessary costs in the base year of 1978-1979, and (3) that the state funding of necessary costs has dipped below that portion in a succeeding year.’ ” Adair, 470 Mich at 111.

Claims brought under the MOS clause involve determinations of specific “statewide-to-local district funding ratio[s] . . . .” Schmidt v Dep’t of Ed, 441 Mich 236, 249-250; 490 NW2d 584 (1992); Durant, 213 Mich App at 505. Such ratios are determined in the following manner:

This approach requires an initial calculation of the proportion of statewide funding for a particular mandated activity to the total necessary costs of providing that activity. The necessary costs to each local unit in the funding year at issue are then calculated. Next, the proportion of state financed funding for the activity or service *513 in the base year is compared to the proportion of funding provided to the district in the year at issue. The state is obligated to afford each unit providing the activity or service the same portion of funding that the state provided on a statewide basis in the year that the Headlee Amendment was ratified. [Schmidt, 441 Mich at 250.]

Thus, by its very nature, the determination of ratios involves the quantifying of the necessary costs incurred by the school districts in specific dollar amounts.

Claims brought under the POUM clause, as is the case here, by contrast, do not involve determinations of statewide to local district funding ratios, but instead address future services or activities and seek funding for the future implementation of newly mandated services or activities. Wayne Co Chief Executive v Governor, 230 Mich App 258, 266; 583 NW2d 512 (1998). The remedy required in such actions is not an award of damages, but instead “comprises a resolution of the parties’ prospective rights and obligations by declaratory judgment.” Id. at 266. Because awards of money damages are not generally at issue, id. at 267, and because this Court lacks authority to order the Legislature to appropriate funds, Musselman v Governor (On Rehearing), 450 Mich 574, 577 (BRICKLEY, C.J.), 582 (BOYLE, J.); 545 NW2d 346 (1996); Musselman v Governor, 448 Mich 503, 524; 533 NW2d 237 (1995), the goal of a declaratory judgment issued in a POUM Headlee action is only to provide sufficient notice so that “the state will be aware of the financial adjustment necessary to allow for future compliance.” Oakland Co, 456 Mich at 166 (Opinion by KELLY, J.). Such notice may be provided without requiring the school districts to demonstrate out-of-pocket expenses in a specifically quantified amount. Indeed, as the evidence adduced before the special master clearly demonstrated, our Legislature possesses the ability to respond to its obligations *514

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Adair v. Michigan
860 N.W.2d 93 (Michigan Supreme Court, 2014)
Adair v. State
302 Mich. App. 305 (Michigan Court of Appeals, 2013)
Adair v. State of Michigan
785 N.W.2d 119 (Michigan Supreme Court, 2010)

Cite This Page — Counsel Stack

Bluebook (online)
760 N.W.2d 544, 279 Mich. App. 507, Counsel Stack Legal Research, https://law.counselstack.com/opinion/adair-v-state-michctapp-2008.