West Orange-Cove Consolidated I.S.D. v. Alanis

107 S.W.3d 558, 46 Tex. Sup. Ct. J. 724, 2003 Tex. LEXIS 71, 2003 WL 21232955

• Court: Texas Supreme Court
• Decided: May 29, 2003
• Docket: 02-0427
• Status: Published

Opinions

Justice HECHT

delivered the opinion of the Court,

in which Chief Justice PHILLIPS, Justice OWEN, Justice O’NEILL, Justice JEFFERSON, Justice SCHNEIDER, and Justice WAINWRIGHT joined.

Article VIII, section 1-e of the Texas Constitution states: “No State ad valorem taxes shall be levied upon any property within this State.”¹ We have held that “[a]n ad valorem tax is a state tax when it is imposed directly by the State or when the State so completely controls the levy, assessment and disbursement of revenue, either directly or indirectly, that the [taxing] authority employed is without meaningful discretion.”²

The maintenance and operation of Texas public schools are funded mostly by ad valorem taxes levied by local school districts under comprehensive state regulation that, among other things, caps the rates at which districts can tax and redistributes local revenue among districts. In 1995, we held that the State’s control of this school funding system had not made local property taxes an unconstitutional state tax because school districts retained meaningful discretion in generating revenue, but we foresaw a day when increasing costs of education and evolving circumstances might force local taxation at maximum rates.³ At that point, we said, the conclusion that a state property tax had been levied would be “unavoidable”.⁴

In the case before us, four plaintiff school districts allege that that day has come. Specifically, they contend that they and other districts have been forced to tax at maximum rates set by statute in order to educate their students. These taxes, they say, have become indistinguishable from a state ad valorem tax prohibited by article VIII, section 1-e.

The district court dismissed the case on the pleadings, holding that a constitutional violation could not be alleged because far fewer than half of Texas’ 1,035 school districts were taxing at the maximum rates allowed. The court of appeals affirmed, focusing not on how many districts were taxing at maximum rates but on whether any of them were forced to do so just to provide an accredited education as defined by statute.⁵ We disagree with both courts and therefore reverse and remand the case to the trial court for further proceedings.

I

This is the fifth in a series of cases to come before us challenging the constitutionality of the Texas public school finance system on various grounds.⁶ Central to some of the cases and basic to them all is article VII, section 1 of the Texas Constitution, which states:

A general diffusion of knowledge being essential to the preservation of the fiber-ties and rights of the people, it shall be the duty of the Legislature of the State to establish and make suitable provision for the support and maintenance of an efficient system of public free schools.⁷

By assigning to the Legislature a duty, this section both empowers and obligates. It gives to the Legislature the sole authority to set the policies and fashion the means for providing a public school system.⁸ Thus we have said that “[w]e do not prescribe the means which the Legislature must employ in fulfilling its duty.”⁹ But the provision also requires the Legislature to meet three standards. First, the education provided must be adequate; that is, the public school system must accomplish that “general diffusion of knowledge ... essential to the preservation of the liberties and rights of the people”. Second, the means adopted must be “suitable”. Third, the system itself must be “efficient”. “[T]hese are admittedly not precise terms,” as we have acknowledged, but “they do provide a standard by which this court must, when called upon to do so, measure the constitutionality of the legislature’s actions.”¹⁰ The final authority to determine adherence to the Constitution resides with the Judiciary.¹¹ Thus, the Legislature has the sole right to decide how to meet the standards set by the people in article VII, section 1, and the Judiciary has the final authority to determine whether they have been met.¹²

In 1989, we decided Edgewood I, the first case challenging the constitutionality of the public school finance system under article VII, section 1. The system’s principal component for funding maintenance and operations was the Foundation School Program, a two-tiered mechanism that the Legislature had set up in 1975.¹³ The first tier was designed to fund a basic education.¹⁴ Every school district that could not, by taxing at a specified minimum rate, generate a certain level of revenue per student in “weighted average daily attendance” (“WADA” — weighted by taking into account special needs and conditions such as special or bilingual education) was given state funds to make up the difference.¹⁵ Despite its stated purpose, first-tier funding did not cover the cost of meeting bare educational requirements mandated by the Legislature.¹⁶ The system’s second tier provided state funds to guarantee a certain level of additional revenue per student in WADA for each penny a school district increased its tax rate above the prescribed minimum.¹⁷ School district tax rates were capped at $1.50 per $100 property valuation¹⁸ as they had been for decades.¹⁹ Smaller components of the school finance system were the Available School Fund established by the Constitution,²⁰ which provided all school districts about $300 per student²¹ and federal funding.²² Facilities and other expenses were funded separately.²³

Then, as now, local ad valorem taxes supplied more than half the funding for public schools,²⁴ the tax bases of the more than 1,000 school districts, and eonse-quently the tax revenue available to them, were vastly different,²⁵ and state tax revenues were inadequate to level local funding disparities.²⁶ At that time, local tax revenues were not redistributed among school districts as they are now. We described the situation thus:

There are glaring disparities in the abilities of the various school districts to raise revenues from property taxes because taxable property wealth varies greatly from district to district. The wealthiest district has over $14,000,000 of property wealth per student, while the poorest has approximately $20,000; this disparity reflects a 700 to 1 ratio. The 300,000 students in the lowest-wealth schools have less than 3% of the state’s property wealth to support their education while the 300,000 students in the highest-wealth schools have over 25% of the state’s property wealth; thus the 300,000 students in the wealthiest districts have more than eight times the property value to support their education as the 300,000 students in the poorest districts. The average property wealth in the 100 wealthiest districts is more than twenty times greater than the average property wealth in the 100 poorest districts....

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Because of the disparities in district property wealth, spending per student varies widely, ranging from $2,112 to $19,333. Under the existing system, an average of $2,000 more per year is spent on each of the 150,000 students in the wealthiest districts than is spent on the 150,000 students in the poorest districts.

The lower expenditures in the property-poor districts are not the result of lack of tax effort. Generally, the property-rich districts can tax low and spend high while the property-poor districts must tax high merely to spend low. In 1985-86, local tax rates ranged from $.09 to $1.55 per $100 valuation. The 100 poorest districts had an average tax rate of 74.5 cents and spent an average of $2,978 per student. The 100 wealthiest districts had an average tax rate of 47 cents and spent an average of $7,233 per student.... A person owning an $80,000 home with no homestead exemption would pay $1,206 in taxes in the east Texas low-wealth district of Leveretts Chapel, but would pay only $59 in the west Texas high-wealth district of Iraan-Sheffield. Many districts have become tax havens.²⁷

The plaintiffs in Edgewood I asserted that this public school finance system was not efficient within the meaning of article VII, section 1. “ ‘Efficient,’ ” we said, “conveys the meaning of effective or productive of results and connotes the use of resources so as to produce results with little waste; this meaning does not appear to have changed over time.”²⁸ Given these circumstances, a unanimous Court had little difficulty concluding that the constitutional standard of efficiency had not been met:

We hold that the state’s school financing system is neither financially efficient nor efficient in the sense of providing for a “general diffusion of knowledge” statewide, and therefore that it violates article VII, section 1 of the Texas Constitution. Efficiency does not require a per capita distribution, but it also does not allow concentrations of resources in property-rich school districts that are taxing low when property-poor districts that are taxing high cannot generate sufficient revenues to meet even minimum standards. There must be a direct and close correlation between a district’s tax effort and the educational resources available to it; in other words, districts must have substantially equal access to similar revenues per pupil at similar levels of tax effort. Children who five in poor districts and children who live in rich districts must be afforded a substantially equal opportunity to have access to educational funds. Certainly, this much is required if the state is to educate its populace efficiently and provide for a general diffusion of knowledge statewide.²⁹

Because constitutional efficiency does not require absolute equality of spending, we expressly acknowledged that “local communities would [not] be precluded from supplementing an efficient system established by the legislature”, but we added that “any local enrichment must derive solely from local tax effort.”³⁰ In other words, the constitutional standard of efficiency requires substantially equivalent access to revenue only up to a point, after which a local community can elect higher taxes to “supplement” and “enrich” its own schools. That point, of course, although we did not expressly say so in Edgewood I, is the achievement of an adequate school system as required by the Constitution. Once the Legislature has discharged its duty to provide an adequate school system for the State, a local district is free to provide enhanced public education opportunities if its residents vote to tax themselves at higher levels. The requirement of efficiency does not preclude local supplementation of schools. Although we were not called upon in Edgewood I to consider what constitutional adequacy entails, the interrelationship between the standards of adequacy and efficiency was fundamental to our reasoning in that case.

We ordered that state funding of public schools cease on May 1, 1990, unless the Legislature conformed the system to meet constitutional standards.³¹ Although we expressly did not “instruct the legislature as to the specifics of the legislation it should enact ... or order it to raise taxes,” ³² we cautioned that “[a] band-aid will not suffice; the system itself must be changed.”³³ Eight months later, in a sixth special session, the Legislature adjusted the system to provide incentives it believed would “achieve substantial equity among the districts that educate 95% of our students.”³⁴ The plaintiffs in Edgewood I immediately challenged this legislation, Senate Bill 1, again on the ground that the system was not efficient within the meaning of article VII, section 1 of the Constitution. Without attempting to determine whether the incentives added by Senate Bill 1 could realistically reach their goals, we concluded in Edgewood II that the system as a whole remained constitutionally inefficient:

Even if the approach of Senate Bill 1 produces a more equitable utilization of state educational dollars, it does not remedy the major causes of the wide opportunity gaps between rich and poor districts. It does not change the boundaries of any of the current 1052 school districts, the wealthiest of which continues to draw funds from a tax base roughly 450 times greater per weighted pupil than the poorest district. It does not change the basic funding allocation, with approximately half of all education funds coming from local property taxes rather than state revenue. And it makes no attempt to equalize access to funds among all districts. By limiting the funding formula to districts in which 95% of the students attend school, the Legislature excluded 182 districts which educate approximately 170,000 students and harbor about 15% of the property wealth in the state. A third of our students attend school in the poorest districts which also have about 15% of the property wealth in the state. Consequently, after Senate Bill 1, the 170,-000 students in the wealthiest districts are still supported by local revenues drawn from the same tax base as the 1,000,000 students in the poorest districts.

These factors compel the conclusion as a matter of law that the State has made an unconstitutionally inefficient use of its resources. The fundamental flaw of Senate Bill 1 lies not in any particular provisions but in its overall failure to restructure the system.³⁵

We reaffirmed that efficiency did not preclude local supplementation of school funding.³⁶ On rehearing, we stressed:

The current system remains unconstitutional not because any unequalized local supplementation is employed, but because the State relies so heavily on un-equalized local funding in attempting to discharge its duty to “make suitable provision for the support and maintenance of an efficient system of public free schools.” Once the Legislature provides an efficient system in compliance with article VII, section 1, it may, so long as efficiency is maintained, authorize local school districts to supplement their educational resources if local property owners approve an additional local property tax.³⁷

Because the Legislature was then in session, we required that it respond without delay, and it promptly enacted Senate Bill 851.³⁸ The legislation created 188 new “county education districts”. In most instances, a CED comprised the school districts in a single county.³⁹ The sole purpose of the CEDs was to levy, collect, and distribute property taxes among their component school districts, respectively, in effect consolidating school districts’ tax bases while leaving them in control of their own schools.⁴⁰ CED tax rates and distributions were prescribed by statute to ensure uniformity. This state-controlled tax-base consolidation “reduced the geographical disparities in the availability of revenue for education”⁴¹ and was not challenged as failing to satisfy the efficiency standard of article VII, section 1. It was, however, challenged as imposing a state ad valorem tax in violation of article VIII, section 1-e of the Constitution. We sustained that challenge in Edgewood III:

Senate Bill 351 mandates the tax CEDs levy. No CED may decline to levy the tax. The tax rate for all CEDs is predetermined by Senate Bill 351. No CED can tax at a higher rate or a lower rate under any circumstances. Indeed, the very purpose of the CEDs is to levy a uniform tax statewide. The distribution of the proceeds is set by Senate Bill 351. No CED has any discretion to distribute tax proceeds in any maimer except as required by statute. Every function of the CEDs is purely ministerial. If the State mandates that a tax be levied, sets the rate, and prescribes the distribution of the proceeds, the tax is a state tax, regardléss of the instrumentality which the State may choose to use.⁴²

To place the situation created by Senate Bill 351 in the broader context of the constitutional prohibition of state ad valo-rem tax, we explained:

An ad valorem tax is a state tax when it is imposed directly by the State or when the State so completely controls the levy, assessment and disbursement of revenue, either directly or indirectly, that the authority employed is without meaningful discretion. How far the State can go toward encouraging a local taxing authority to levy an ad valorem tax before the tax becomes a state tax is difficult to delineate. Clearly, if the State merely authorized a tax but left the decision whether to levy it entirely up to local authorities, to be approved by the voters if necessary, then the tax would not be a state tax. The local authority could freely choose whether to levy the tax or not. To the other extreme, if the State mandates the levy of a tax at a set rate and prescribes the distribution of the proceeds, the tax is a state tax, irrespective of whether the State acts in its own behalf or through an intermediary. Between these two extremes lies a spectrum of other possibilities. If the State required local authorities to levy an ad valorem tax but allowed them discretion on setting the rate and disbursing the proceeds, the State’s conduct might not violate article VIII, section 1-e. It is difficult, perhaps impossible, to define for every conceivable hypothetical precisely where along this continuum such taxes become state taxes. Therefore, if the Legislature, in an effort to remedy Senate Bill 351 with as few changes as possible, chose to inject some additional element of leeway in the assessment of the CED tax, it is impossible to say in advance whether that element would remove the tax from the prohibition of article VIII, section 1-e. Each case must necessarily turn on its own particulars. Although parsing the differences may be likened to dancing on the head of a pin, it is the Legislature which has created the pin, summoned the dancers, and called the tune. The Legislature can avoid these constitutional conundra by choosing another path altogether.⁴³

We also held that by levying a tax without an election, the CEDs violated article VII, section 3(e) of the Constitution.⁴⁴

We delayed enforcement of our ruling for more than a year, until the end of the next regular session of the Legislature in 1993.⁴⁵ During that session, the Legislature’s first reaction was to attempt to amend the Constitution. A proposed amendment that would have rewritten article VII, section 1 to remove its standards and commit the responsibility for public education to local school districts was introduced but not reported out of committee.⁴⁶ A proposed amendment that would have authorized the system structured by Senate Bill 351 passed the Senate and narrowly passed the House⁴⁷ but was soundly defeated by the people before the session ended.⁴⁸ The Legislature then enacted Senate Bill 7.⁴⁹

Senate Bill 7 returned to the two-tiered Foundation School Program,⁵⁰ the basic structure of which remains in place today.⁵¹ As before, “[t]he stated purpose of Tier 1 is to guarantee ‘sufficient financing for all school districts to provide a basic program of education that meets accreditation and other legal standards.’ ”⁵² At a minimum $0.86 tax rate, a school district that cannot generate revenue equal to a “basic allotment” per student in WADA— in 1993, $2,300,⁵³ and today, $2,537,⁵⁴ subject to various adjustments⁵⁵ — receives state funds for the difference.⁵⁶ As before, the basic allotment does not cover the cost of an education that meets legislated accrediting standards.⁵⁷ Tier 2 provides for partially state-supported local supplementation.⁵⁸ For each penny a district raises the tax rate above the minimum, the state guarantees a certain yield per weighted student — $20.55 in 1993,⁵⁹ and $27.14 today.⁶⁰ The tax rate for maintenance and operations continues to be capped at $1.50, subject to various adjustments and exceptions.⁶¹ There is also some state funding for facilities, sometimes referred to as Tier 3 in the system.⁶²

The major change that Senate Bill 7 made in the Foundation School Program was to equalize school districts’ “wealth per student” — a district’s taxable property value divided by the number of students in WAD A.⁶³ A school district with wealth per student greater than a certain amount— $280,000 in 1993,⁶⁴ and $305,000 today⁶⁵— must transfer the excess, or the tax revenue generated from it, either actually or effectively, so as to provide funding for school districts with less wealth.⁶⁶ The local tax revenue “recaptured” and redistributed by this mechanism amounted to almost $1 billion in 2000.⁶⁷ This taxable wealth equalization scheme, dubbed by some “Robin Hood”, eliminates the geographical disparities in available revenue among school districts that characterized the pre-1993 version of the Foundation School Program.

The public school finance system set up by Senate Bill 7 was challenged on numerous grounds, all of which we rejected in Edgewood IV. Two are important for purposes of the present case. We held that the unequalized funding available for local supplementation did not render the system constitutionally inefficient:

It is apparent from the Court’s opinions that we have recognized that an efficient system does not require equality of access to revenue at all levels. Otherwise, unequalized local supplementation, which we expressly approved in Edgewood II, could never be justified. Article VII, section 1 of the Constitution and our previous Edgewood decisions mandate that efficiency be measured against both qualitative and financial standards.

The district court viewed efficiency as synonymous with equity, meaning that districts must have substantially equal revenue for substantially equal tax effort at all levels of funding. This interpretation ignores our holding in Edgewood II that unequalized local supplementation is not constitutionally prohibited. The effect of this “equity at all levels” theory of efficiency is to “level-down” the quality of our public school system, a consequence which is universally regarded as undesirable from an educational perspective. Under this theory, it would be constitutional for the Legislature to limit all districts to a funding level of $500 per student as long as there was equal access to this $500 per student, even if $8500 per student were required for a general diffusion of knowledge. Neither the Constitution nor our previous Edge-wood decisions warrant such an interpretation.⁶⁸

Constitutional efficiency under article VII, section 1 requires only that “districts must have substantially equal access to funding up to the legislatively defined level that achieves the constitutional mandate of a general diffusion of knowledge.”⁶⁹ That legislatively defined level was an accredited education:

In Senate Bill 7, the Legislature equates the provision of a “general diffusion of knowledge” with the provision of an accredited education. The accountability regime set forth in [the statute], we conclude, meets the Legislature’s constitutional obligation to provide for a general diffusion of knowledge statewide.⁷⁰

We cautioned, however, that the Constitution does not give the Legislature a completely free hand in determining what level of education will achieve the general diffusion of knowledge required by article VII, section 1:

As long as the Legislature establishes a suitable regime that provides for a general diffusion of knowledge, the Legislature may decide whether the regime should be administered by a state agency, by the districts themselves, or by any other means.

This is not to say that the Legislature may define what constitutes a general diffusion of knowledge so low as to avoid its obligation to make suitable provision imposed by article VII, section 1. While the Legislature certainly has broad discretion to make the myriad policy decisions concerning education, that discretion is not without bounds.⁷¹

The interrelated constitutional standards of efficiency and adequacy both limit legislative discretion:

As long as efficiency is maintained, it is not unconstitutional for districts to supplement their programs with local funds, even if such funds are unmatched by state dollars and even if such funds are not subject to statewide recapture. We caution, however, that the amount of “supplementation” in the system cannot become so great that it, in effect, destroys the efficiency of the entire system. The danger is that what the Legislature today considers to be “supplementation” may tomorrow become necessary to satisfy the constitutional mandate for a general diffusion of knowledge.⁷²

“This is simply another way of saying that the State’s provision for a general diffusion of knowledge must reflect changing times, needs, and public expectations.”⁷³

In Edgewood TV, we also held that Senate Bill 7 did not impose a state ad valo-rem tax in violation of article VIII, section 1-e of the Constitution simply because a number of school districts were already taxing at the maximum $1.50 rate. Some districts were taxing below the minimum $0.86 rate, and it appeared that for the most part “[p]roperty-poor and property-rich districts presently can attain the revenue necessary to provide suitably for a general diffusion of knowledge at tax rates of approximately $1.31 and $1.22, respectively.” ⁷⁴ We acknowledged, however, that over time more districts would be required to tax at the maximum $1.50 rate: if the cost of providing for a general diffusion of knowledge continues to rise, as it surely will, the minimum rate at which a district must tax will also rise. Eventually, some districts may be forced to tax at the maximum allowable rate just to provide a general diffusion of knowledge. If a cap on tax rates were to become in effect a floor as well as a ceiling, the conclusion that the Legislature had set a statewide ad valorem tax would appear to be unavoidable because the districts would then have lost all meaningful discretion in setting the tax rate.⁷⁵

Although we rejected all of the challenges to Senate Bill 7, we stressed that the system was “minimally acceptable only when viewed through the prism of history.” ⁷⁶ In other words, it was better than it had been. But we added: “Surely Texas can and must do better.”⁷⁷ In every session since 1993, the Legislature has amended the Education Code,⁷⁸ but little change has been made in funding the maintenance and operation of public schools. As noted, the Tier 1 basic allotments, the Tier 2 guaranteed yields, and the equalization threshold have all been increased, thereby providing more state funds for public education, but the structure of the system remains essentially the same. Meanwhile, the level of state funding has continued to fall, reliance on local property taxes has increased,⁷⁹ and more school districts — now 39% with 32% of the State’s 4.1 million students, according to petitioners’ calculations from data furnished by the Texas Comptroller — have reached maximum tax rates.

Presciently, we observed in Edgewood IV: “Our judgment in this case should not be interpreted as a signal that the school finance crisis in Texas has ended.”⁸⁰

II

In the case now before us, filed in April 2001, four school districts⁸¹ assert that the public school finance system has come to involve a state ad valorem tax in violation of article VIII, section 1-e, just as we foresaw it might in Edgewood TV.82 Specifically, after quoting our admonition from Edgewood IV, the plaintiffs alleged:

In the six years since the 1995 Edge-wood IV decision, education costs have continued to rise. As predicted in Edge-wood IV, school districts, such as the Plaintiffs, are required to tax at or near the maximum allowable $1.50 M & O [maintenance and operation] tax rate in order to educate students in their districts. Such school districts have lost all meaningful discretion in setting their M & O tax rate. Accordingly, as contemplated by the Supreme Court in Edge-wood IV, the statutory cap on the M & O tax rate has become a statewide ad valorem tax in violation of the Texas Constitution. Without relief from the statutory cap on M & O tax rates, the Plaintiff school districts must continue to take such measures as cutting programs, eliminating teaching positions and/or increasing class size.

(Emphasis added.) Plaintiffs prayed for a judgment declaring the $1.50 statutory cap to be a constitutionally prohibited state ad valorem tax.

The defendants⁸³ (collectively, “the State”) answered with a plea to the jurisdiction, plea in abatement, and special exceptions, asserting that the action was not ripe and should be dismissed. Specifically, the State asserted:

• “the system would not result in a statewide ad valorem tax unless and until the ‘cap on tax rates were to become in effect a floor as well as a ceiling’ [quoting Edgewood IV, 917 S.W.2d at 788] as to all districts” (emphasis added), and plaintiffs do not and cannot allege that this is the situation;

• “Plaintiffs do not allege that the system requires them or any other district to tax at the rate of $1.50 in order to provide a general diffusion of knowledge ” (emphasis in original) as they must to allege a constitutional violation, “but instead allege only that they must tax at (or near) $1.50 ‘in order to educate students in their districts’”; and

• because “each of the Plaintiff districts ... has voluntarily elected to grant an optional twenty percent homestead exemption ... they cannot plead or prove that the State system forces them to tax at $1.50 just to provide an accredited education.”

The State’s ripeness and pleading arguments were thus related: in the State’s view, the claims the plaintiffs were required to plead in order to state the constitutional violation they asserted were not ripe.

In response, the plaintiffs argued that:

• to show a state property tax they were required to prove only that some, not all, school districts were forced to tax at maximum rates;

• although the defendants contended that an accredited education could be provided for $4,179 per student, plaintiffs were entitled to explore the factual basis for that figure and to show that taxation at maximum rates was required to provide an accredited education; and

• homestead exemptions should not be taken into account in determining whether school districts were being forced to tax at maximum rates.

The plaintiffs contended that their pleadings were sufficient and stated claims that were ripe.

Two groups of school districts intervened. While they opposed the plaintiffs’ claims, they alleged that the public school finance system remained flawed for other reasons. The six Edgewood intervenors⁸⁴ asserted:

The Edgewood Intervenors are Defendant Intervenors to the extent that they agree that this case should be dismissed for lack of ripeness and, therefore, lack of subject matter jurisdiction. On the other hand, Edgewood Interve-nors are Cross-Plaintiff Intervenors to the extent that they agree that the Texas School Finance System at $1.50 does not provide sufficient funding or equitable funding to guarantee a general diffusion of knowledge.

The thirty-four Alvarado intervenors⁸⁵ asserted: “In spite of the fact that progress is being made, Intervenors do not concede that the funding levels for Tier 2 districts set by the legislature achieves an adequate level of funding for public schools in Texas.” They added that “the state is not contributing its fair share of monies needed to maintain an adequate school finance system.” Regarding the plaintiffs’ claims, they agreed with the defendants that they should be dismissed:

Intervenors view Plaintiffs’ case as a pure adequacy claim. As stated above, the $1.50 tax rate cap never becomes a factor unless total revenues available to school districts are inadequate to provide for a general diffusion of knowledge. Intervenors believe that the maintenance of an equitable system is the best way to insure adequacy.

The Alvarado intervenors specially excepted to the plaintiffs’ pleading for alleging only that they were required to tax at maximum rates “to educate their students” rather than “to provide the constitutionally-required general diffusion of knowledge to their students.” The plaintiffs responded:

This special exception mischaracter-izes Plaintiffs’ pleading and constitutes unnecessary hairsplitting over semantics. [Plaintiffs quoted from Edgewood TV and] then made clear that their cause of action was based on the [quoted] language, and that they are required to tax “at or near the $1.50 M & 0 tax rate in order to educate students in their dis-triets”, i.e., to provide a general diffusion of knowledge. Because the “floor” described by the Court [in Edgewood IV] is linked to the “general diffusion of knowledge” standard, Plaintiffs were implicitly (if not explicitly) alleging that they had to tax at or near $1.50 just to provide their students with a general diffusion of knowledge.

Ten weeks after the case was filed, the trial court conducted a hearing on the dilatory pleas and the special exceptions. The defendants argued, and the trial court agreed, that this Court’s admonition in Edgewood IV that the finance system could result in a state property tax was dicta.⁸⁶ The plaintiffs argued, however, that this Court had described circumstances that could violate the constitutional prohibition of a state ad valorem tax, and that they were entitled to prove that those circumstances had come into existence. Regarding the plaintiffs’ pleadings, the following colloquy occurred:

THE COURT: Well, let me ask counsel for the plaintiffs: are you ... pleading that ... you can’t provide an accredited system on $1.50 or are you pleading that the accredited system isn’t good enough to provide a general diffusion of knowledge and you can’t provide a general diffusion of knowledge on $1.50?

COUNSEL: All of the above. All the above.... And again, we’re involved in notice pleading. We pled it. It’s pretty clear what we’re driving at. We’re driving at page 738 of the Edgewood [IV] majority opinion.

The trial court did not hear evidence but did take judicial notice of state appropriations and school district tax levies.

Less than a month later, the trial court issued an order dismissing the case. The court explained in the order:

Whether the Legislature has imposed a state ad valorem tax is decided by reference to how the public school finance system works throughout the state, not by reference to how the system works in any one district. Moreover, to look at the question district by district would mean that the tax could be constitutional in one district and unconstitutional in another. Thus, the court must assess the system as a whole.

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Remember that the constitutional question is not how many districts are at the cap, but how many districts must be at the cap to provide an accredited education. The court today is merely holding that a plaintiff must be able to plead that some significant number of districts are at the cap to go forward with a claim that too many districts must be at the cap. Naturally, the court has assumed on special exceptions that if a district is at the cap, the district must be at the cap. This pleading assumption builds in a significant margin of error in favor of the plaintiff districts.

The margin of error is in favor of the plaintiff districts because, on the merits, the plaintiffs must show that the highly-acclaimed school districts taxing at $1.50 would plummet to academically-unacceptable school districts at $1.49.

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Though Edgewood IV provides limited guidance on how many districts must have to tax at the cap to be constitutionally significant, or, in other words, for the court to conclude that the districts have lost “meaningful discretion” in levying the ad valorem tax, based upon what the Supreme Court does teach, this court holds that for the approved tax to become a prohibited state ad valorem tax, some significant number of districts across the state must have to tax at the $1.50 cap in order to provide an accredited education. For the legislative design to be an unconstitutional state ad valorem tax, the design must require a significant number of districts to tax at the cap, something approaching or exceeding half the districts.

Thus, a single number decides the case on special exceptions — the percentage of districts that are at the cap of $1.50. The plaintiffs do not and cannot state a claim upon which relief can be granted because a constitutionally insignificant number of districts are at the cap of $1.50. Only 19% of the school districts even tax at the cap of $1.50, which means that 81% do not. Indeed, two of the plaintiff districts do not tax at the $1.50 rate. Moreover, many districts, including all four plaintiffs, have granted local-option tax exemptions. Only 12% of the school districts tax at the cap of $1.50 without a local-option exemption, which means that 88% do not.

Of course, the decision to grant a local-option exemption in and of itself is the exercise of meaningful local discretion. By granting a local-option exemption, for whatever worthy reason, a school district takes a great amount of taxable wealth out of the system.... The court is not implying that these exemptions are not appropriate; the court is merely saying that they have the same effect as substantially lowering the tax rate. As long as a district has an exemption, therefore, it is not at the tax cap.

The court dismissed with prejudice the plaintiffs’ allegation of an existing violation of article VIII, section 1-e, and dismissed without prejudice the plaintiffs’ allegation that a violation was imminent.

The court of appeals affirmed,⁸⁷ but not for the reasons given by the trial court. Although the court of appeals considered the pleading and ripeness issues separately, it recognized that the parties’ arguments on both issues are related. In the court of appeals’ view, the number of school districts taxing at maximum rates was irrelevant. “Whether the effect of the tax is experienced ‘statewide ’ or by a majority of districts in the state does not determine whether a tax is a state tax.”⁸⁸ Rather, the court said, “the controlling factor in reviewing a challenge to an alleged ad valorem tax is the State’s involvement in the levy.”⁸⁹ “Seen in this light,” the court said, “the positions taken by the district court ... and by the parties in their briefs, are based on a misunderstanding of the determinative factors of a state ad valorem tax.”⁹⁰

Regarding the plaintiffs’ pleadings, the court explained:

In determining the State’s control over the maintenance and operations property tax, the relevant inquiry is the relationship between the tax and the districts’ obligations to provide an accredited education. As the court found in Edgewood TV, the system may encourage districts to tax at or near the maximum rate. Whether it does so is irrelevant for purposes of determining whether the system imposes a state tax. But if the districts’ abilities to fulfill a state mandate, here the obligation to provide the minimum accredited education, forced the districts to tax at the maximum rate, the system might approach an unacceptable level of state control over the levy. Therefore, the allegation that a district is forced to tax at the highest allowable rate to provide the bare, accredited education is a necessary element of a cause of action brought by a district challenging the cap.⁹¹

The court concluded that the plaintiffs had failed to make this allegation:

West Orange-Cove instead pleaded that it was forced to tax at or near $1.50 to “educate its students.” The enriched education that West Orange-Cove locally desires to provide its students is not the measure for determining if the State is imposing an educational mandate that requires the local district to levy a state-imposed rate of tax. West Orange-Cove’s pleadings simply fail to state a viable cause of action.⁹²

Because the plaintiffs’

allegation does not refer to the districts’ state-imposed obligation to provide an accredited education ..., the districts’ pleadings fail to state a challenge to the tax as a state tax. Accordingly, we hold that the trial court properly dismissed the claim for failure to state a cause of action.⁹³

The court also held that the plaintiffs’ claim that taxation at maximum rates was necessary to achieve the constitutional standard of “a general diffusion of knowledge” was nonjusticiable:

As the record makes clear, West Orange-Cove wants to use this opportunity, framed as a tax challenge, to engage the judiciary in a debate over policy choices that are within the province of the legislative branch. Both the Legislature and the supreme court have equated the term “general diffusion of knowledge” with accreditation standards. The court, in addition, has insisted that the judiciary has a limited role in the area of educational policy and should defer to the Legislature on matters involving educational standards and funding ... [citing Edgewood IV, 917 S.W.2d at 726]. West Orange-Cove’s claim would involve the courts in deciding what is meant by the term “general diffusion of knowledge” without reference to the accreditation standards set by the Legislature. That body, however, has conclusively equated the two concepts, thereby foreclosing the judicial inquiry West Orange-Cove seeks to pursue. Moreover, as the supreme court has recognized, the meaning of a “general diffusion of knowledge” and the development of appropriate accreditation standards are policy choices best suited to the legislature. Id.94

Summarizing its holdings, the court of appeals stated:

The instant case is not unripe because fewer than half of all school districts are taxing at the maximum rate; rather, the claim is unripe because the appellants have failed to demonstrate that they are forced to set their rates of tax at the maximum allowable rate just to provide an accredited education. That is, the districts have not pleaded that they have lost all meaningful discretion in setting the rate of tax as it pertains to their ability to meet a state-imposed obligation, which is the only relevant concern in this lawsuit.⁹⁵

We granted the plaintiffs’ petition for review and expedited oral argument.⁹⁶

Ill

We consider first what the plaintiffs must allege to state a violation of article VIII, section 1-e, and then whether the plaintiffs can and do make that allegation.

A

We adhere to the rule stated in Edgewood III that “[a]n ad valorem tax is a state tax when it is imposed directly by the State or when the State so completely controls the levy, assessment and disbursement of revenue, either directly or indirectly, that the authority employed is without meaningful discretion.”⁹⁷ The determining factor is the extent of the State’s control over the taxation process.

The State argues that local school district property taxes cannot be a state tax unless every district is forced to tax at a specific rate, here, the maximum $1.50 rate for maintenance and operation (subject to adjustments). The trial court rejected this argument but held that there can be no state tax unless most districts are forced to tax at maximum rates. Both positions presuppose that the issue is the extent of the tax and that the determination must be made from the perspective of the system as a whole rather than with respect to each district. As the trial court stated: “Whether the Legislature has imposed a state ad valorem tax is decided by reference to how the public school finance system works throughout the state, not by reference to how the system works in any one district.” This premise has no support in the constitutional text or the rule we have stated for applying it. The Constitution prohibits “State ad valorem taxes ... upon any property within this State” (emphasis added) and is not limited to statewide ad valorem taxes. The provision expressly contemplates that a state ad va-lorem tax could be levied on only some property. The prohibition does not permit the State to set rates for hospital districts, or junior college districts, or mosquito control districts, or fire prevention districts, or noxious weed control districts — to name but a few of the many taxing authorities⁹⁸ —just because such districts are confined to a few areas of the State, nor does the Constitution permit the State to control the tax rate for even one such district. Were it otherwise, then as we observed in Edgewood III:

The State could create County Highway Districts, or County Prison Districts, or all-purpose County Funding Districts to levy taxes at set rates for prescribed purposes, and by such means accomplish what it could not do itself.⁹⁹

The concern is not the pervasiveness of the tax but the State’s control of it. A state ad valorem tax is just that — one imposed by the State, whether it acts directly or through control of another entity, and whether the tax falls on the entire population or only a few.

Thus, a single district states a claim under article VIII, section 1-e if it alleges that it is constrained by the State to tax at a particular rate. How a constitutional violation in one or a few school districts would impact the public school finance system as a whole is not before us.

B

The State argues that for four reasons the plaintiffs cannot allege that they are forced to tax at maximum rates. To sustain the dismissal of the plaintiffs’ case on the pleadings, however, the State must establish the plaintiffs’ inability to plead a constitutional violation as a matter of law.¹⁰⁰ We examine each of the State’s reasons in turn.

The State asserts that it exerts no control over taxation by local school districts and that the districts are free to tax at any levels they choose up to the maximum. The State’s argument runs as follows. The duty to provide an adequate public education belongs to the Legislature, not local school districts. School districts are “forced” to do nothing; they choose to tax and educate at desired levels. While the State may encourage certain choices, it does not compel them.

This argument, in essence, is that nothing short of virtually absolute state control of ad valorem taxation violates article VIII, section 1-e. We plainly rejected the argument in Edgewood III:

How far the State can go toward encouraging a local taxing authority to levy an ad valorem tax before the tax becomes a state tax is difficult to delineate. Clearly, if the State merely authorized a tax but left the decision whether to levy it entirely up to local authorities, to be approved by the voters if necessary, then the tax would not be a state tax. The local authority could freely choose whether to levy the tax or not. To the other extreme, if the State mandates the levy of a tax at a set rate and prescribes the distribution of the proceeds, the tax is a state tax, irrespective of whether the State acts in its own behalf or through an intermediary. Between these two extremes lies a spectrum of other possibilities. If the State required local authorities to levy an ad valorem tax but allowed them discretion on setting the rate and disbursing the proceeds, the State’s conduct might not violate article VIII, section 1-e. It is difficult, perhaps impossible, to define for every conceivable hypothetical precisely where along this continuum such taxes become state taxes.¹⁰¹

Certainly, the State does not now control taxation by school districts to the same extent it controlled taxation by the CEDs. But as we have said, the constitutional prohibition is violated whenever state control denies a taxing authority “meaningful discretion”.¹⁰²

The Legislature has deprived school districts of any meaningful discretion to provide an inadequate education, as indeed it is constitutionally bound to do. The Legislature’s duty under article VII, section 1 is to make suitable provision for a general diffusion of knowledge through free public schools. “As long as the Legislature establishes a suitable regime that provides for a general diffusion of knowledge, the Legislature may decide whether the regime should be administered by a state agency, by the districts themselves, or by any other means.”¹⁰³ “Certainly, if the Legislature substantially defaulted on its responsibility such that Texas school children were denied access to that education needed to participate fully in the social, economic, and educational opportunities available in Texas, the ‘suitable provision’ clause [of article VII, section 1] would be violated.”¹⁰⁴ “In Edgewood I, we reaffirmed that the requirement of suitability is a judicially-enforceable mandate....”¹⁰⁵ A public school system dependent on local districts free to choose not to provide an adequate education would in no way be suitable. In fact, the Legislature has acted to ensure that that is not the system. Chapter 39 of the Education Code, entitled “Public School System Accountability”, sets school accreditation standards,¹⁰⁶ rewards achievement of these standards,¹⁰⁷ and imposes sanctions for non-compliance ranging from admonitions to closure of the district.¹⁰⁸ These provisions are legislated requirements that school districts provide an adequate education, and they leave no meaningful discretion for districts to do otherwise.

We also rejected the position for which the State now argues in Edgewood IV, expressly recognizing that school districts could indeed be “forced” — our word — by increasing costs “to tax at the maximum allowable rate just to provide a general diffusion of knowledge.”¹⁰⁹ The “ceiling”, we said, could become a “floor” as well, in which event “the conclusion that the Legislature had set a statewide ad valorem tax would appear to be unavoidable because the districts would then have lost all meaningful discretion in setting the tax rate.”¹¹⁰ The State successfully argued to the trial court that these statements were dicta,¹¹¹ but they were an important part of our rationale.¹¹² We held in Edgewood IV that local ad valorem taxes were not state ad valorem taxes because of then-existing circumstances that allowed school districts meaningful discretion in setting tax rates, and we expressly acknowledged that those circumstances could, and probably would, change. That distinction defined the reach of the Court’s decision in the case. Had we thought that local school district property taxes could never violate article VIII, section 1-e, our decision would certainly have been far easier.

We remain of the view that school districts can be forced by the current system to tax at maximum rates. An allegation that this has occurred states a claim under article VIII, section 1-e.

Alternatively, the State argues that its only requirement of school districts is that they provide an accredited education as defined by the Legislature, and that the plaintiffs cannot allege in good faith that any district is forced to tax at the maximum rate just to meet this requirement. On the contrary, the State says, school districts taxing at maximum rates do so to provide enhanced educational opportunities and not merely to maintain accreditation. The court of appeals appears to have agreed with this argument.

Again, the State’s argument suffers a flawed premise. Accreditation standards are not the only requirements the State imposes on school districts. As we have just explained, because the State has chosen to rely heavily on school districts to discharge its duty to provide a constitutionally adequate education — that is, “[a] general diffusion of knowledge ... essential to the preservation of the liberties and rights of the people”¹¹³ — the State must require that school districts achieve this goal; otherwise, the public school system is not suitable for its purpose. Consistent with its constitutional duty, the Legislature has stated:

The mission of the public education system of this state is to ensure that all Texas .children have access to a quality education that enables them to achieve their potential and fully participate now and in the future in the social, economic, and educational opportunities of our state and nation. That mission is grounded on the conviction that a general diffusion of knowledge is essential for the welfare of this state and for the preservation of the liberties and rights of citizens.¹¹⁴

We acknowledged in Edgewood IV that the Legislature in 1993 equated an accredited education with a general diffusion of knowledge and discharged its duty to provide for the latter by demanding accountability of school districts.¹¹⁵ But we also insisted that the “State’s provision for a general diffusion of knowledge must reflect changing times, needs, and public expectations”,¹¹⁶ and that the Legislature is not the sole arbiter of the constitutional standard.¹¹⁷ The public school system the Legislature has established requires that school districts provide both an accredited education and a general diffusion of knowledge. It may well be that the requirements are identical; indeed, as in Edge-wood IV, we presume they are, giving deference to the Legislature’s choices. But it is possible for them not to be — an accredited education may provide more than a general diffusion of knowledge, or vice versa — and because both are binding, a district may allege that taxation at a maximum rate in order to satisfy either is a state ad valorem tax.

The court of appeals concluded that to “involve the courts in deciding what is meant by the term ‘general diffusion of knowledge’ without reference to the accreditation standards set by the Legislature” would “engage the judiciary in a debate over policy choices that are within the province of the legislative branch.”¹¹⁸ We agree, as we have already explained, that it is outside the scope of judicial authority to review the Legislature’s policy choices in determining what constitutes an adequate education, and we emphasize that the courts cannot undertake to review those choices one by one or attempt to define in detail an adequate education. But once policy choices have been made by the Legislature, it is the judiciary’s responsibility in a proper case to determine whether those choices as a whole meet the standard set by the people in article VII, section 1.

Even if the plaintiffs’ claims were limited to taxing to provide an accredited education, there is no factual record for determining what the cost of an accredited education is. The plaintiffs urged in the trial court that they were entitled to discover the State’s evaluation of that cost and to present evidence that the true cost is greater. For the trial court, this factual dispute was irrelevant, given its view that the plaintiffs could not allege a constitutional violation because they could not allege that half or close to half of all school districts were taxing at maximum rates. But since we have concluded, as the court of appeals did, that the number of districts taxing at maximum rates is not determinative of the plaintiffs’ claims, the subsisting dispute over the cost of an accredited education precludes dismissal of the case on the pleadings.

Thus, to obtain dismissal of the plaintiffs’ claims on the merits based solely on the pleadings, the State must establish as a matter of law that the plaintiff school districts are not forced to tax at maximum rates either to meet accreditation standards or to provide a general diffusion of knowledge. The State has done neither.

The Legislature has granted a partial homestead exemption from school district taxation,¹¹⁹ which a district may increase up to a certain amount at its option,¹²⁰ as many districts do. The State argues that no school district that has opted for an increased homestead exemption can allege that it is forced to tax at maximum rates because it has meaningful discretion to deny the increased exemption and tax at a lower rate. The trial court agreed with this argument, and the court of appeals did not address it.

We reiterate that to obtain dismissal of the plaintiffs’ action based solely on the pleadings, the State must establish that the mere existence of local-option exemptions precludes as a matter of law the allegation that school districts are forced to tax at maximum rates. The State has not met this burden. For one thing, the plaintiffs may be able to show that even without granting additional homestead exemptions, they could not provide an accredited education or a general diffusion of knowledge. For another thing, while school districts obviously have discretion whether to increase homestead exemptions, it is far from obvious that their discretion is meaningful. By authorizing local-option homestead exemptions, knowing that some constituencies will insist on them, the Legislature may actually have increased the pressure on school districts to tax at maximum rates. In any event, the plaintiffs are entitled to attempt to show that homestead exemptions do not afford them meaningful discretion.

Finally, the State argues that the plaintiffs cannot allege a violation of article VIII, section 1-e unless they tax at the applicable absolute maximum rate, not merely near that rate, as apparently only two of the four plaintiffs do. This is simply not the case. The constitutional issue remains the extent of the State’s control. It may be that a school district taxing at $1.47 instead of $1.50 has exercised meaningful discretion, but that is not necessarily the case. A district taxing a few cents below the maximum rate that can no longer provide an accredited education or a general diffusion of knowledge even by raising the rate to the maximum need not do so just to prove the point.

C

The last matter is whether the plaintiffs did plead what they must to allege a violation of article VIII, section 1-e. The plaintiffs alleged that they were required to tax at maximum rates “to educate their students”. In response to special exceptions, the plaintiffs stated that their allegation was tantamount to pleading that taxing at maximum rates was necessary to provide for a general diffusion of knowledge. When asked by the trial court whether the plaintiffs were pleading that they could not provide an accredited education or a general diffusion of knowledge at maximum rates, counsel responded, “All of the above.” The plaintiffs repeatedly stated that they were pleading that the situation we foresaw in Edgewood IV would violate article VIII, section 1-e had in fact occurred. No reasonable argument can be made that the plaintiffs’ pleadings did not put the State on notice of their claims. Of course, on special exceptions the trial court has discretion to further clarify the issues to be litigated by requiring the plaintiffs to allege specifically, for example, whether they are taxing at maximum rates to provide an accredited education, or to provide for a general diffusion of knowledge, or both, and whether the costs are different.

We add a few words in response to the dissent.

First: The dissent would hold that plaintiffs lack standing to sue. While “standing, as a component of subject matter jurisdiction, cannot be waived”¹²¹ and may thus be raised at any time, the fact that the State has not challenged the plaintiffs’ standing to sue, nor was the standing of any school district challenged in Edge-wood I, Edgewood II, Edgewood III, or Edgewood IV, is some indication of the weakness of the dissent’s argument. In Nootsie, Ltd. v. Williamson County Appraisal District, we held that a county appraisal district had standing to seek a declaratory judgment that the Legislature had unconstitutionally defined open-space land for tax purposes to include ecological laboratories.¹²² We see no difference in the standing of an appraisal district to assert its claims in Nootsie and the standing of the school districts here. The dissent argues that Nootsie is at odds with federal standing jurisprudence, but even if it were — something we need not decide here — the dissent does not explain why any difference between Texas law and federal law is reason enough for us not to follow our own recent precedent. The dissent also argues that because the plaintiff school districts do not have and do not claim to have a constitutional right to meaningful discretion, they have no standing to seek a determination that taxation at maximum rates is a constitutionally prohibited state ad valorem tax. Again conceding the premise solely for argument purposes, we fail to see how the declaration the school districts request in this case is any different from the one the appraisal district requested in Nootsie. As we explained in Nootsie, the argument that

the district has no inherent vested rights protected by the Constitutions of Texas and the United States ... misses the mark because the district does not contend that the statute violates constitutional rights belonging to the district. Instead, the district asserts an interest because it is charged with implementing a statute that it believes violates the Texas Constitution. This interest provides the district with a sufficient stake in this controversy ... that the declaration sought will resolve.¹²³

Finally, the dissent argues that Nootsie can be distinguished because there the appraisal district represented aligned interests while here the plaintiff school districts represent disparate and conflicting interests. We do not understand this distinction. Nootsie allowed an appraisal district to challenge the constitutionality of a tax exemption that at least one of its taxpayers, Nootsie, Ltd., claimed and others may have opposed. We fail to see how the interests of the taxpayers and citizens in the appraisal district in Nootsie were any less at odds than the interests of the taxpayers and citizens in the plaintiff school districts are here. For the same reasons we explained in Nootsie, we hold that the plaintiff school districts in this case have standing to assert their claims.

Second: Contrary to the dissent’s assertion, we do not hold that school districts have a constitutional duty to provide for a general diffusion of knowledge. The districts’ obligation is imposed by the Legislature, not the Constitution, as the passage of our opinion to which the dissent refers expressly states — “[t]he public school system the Legislature has established requires that school districts provide both an accredited education and a general diffusion of knowledge” (emphasis added) — and we repeat elsewhere and now again here. The Legislature has expressly defined the mission of the public school system, including school districts, to accomplish a general diffusion of knowledge.¹²⁴ As we have explained, the Legislature has chosen to make suitable provision for a general diffusion of knowledge by using school districts, and therefore the State cannot be heard to argue that school districts are free to choose not to achieve that goal. If they were, the Legislature’s use of districts to discharge its constitutional duty would not be suitable, since the Legislature would have employed a means that need not achieve its end.

Third: The dissent would hold, contrary to Edgewood III and Edgewood IV, that a state ad valorem tax is a tax used for a state purpose rather than a tax levied by the State. We find nothing in the text or history of article VIII, section 1-e to require that a state tax be determined by its purpose rather than by the extent of state control over its employment. Nor are we clear how such a purpose-oriented standard would operate. In the dissent’s view, any effort to equalize tax revenues among school districts for public education violates article VIII, section 1-e because education is a state purpose. This directly contradicts the Court’s holdings in Edgewood III and Edgewood IV. We do not agree with the dissent that the importance of stare decisis can be minimized in this area. For fourteen years the Legislature has worked to bring the public school finance system into conformity with constitutional requirements as declared by this Court. To announce now that we have simply changed our minds on matters that have been crucial to the development of the public education system would not only threaten havoc to the system, but would, far more importantly, undermine the rule of law to which the Court is firmly pledged.

Fourth: The dissent argues that this Court’s construction of article VII, section 1 since Edgewood I and perhaps dating back to Mumme v. Marrs¹²⁵ necessarily draws the judiciary into making detailed policy decisions about the elements of an adequate education. We reiterate that the Constitution requires, not that courts make such policy decisions, but that they determine, in a proper case, whether the Legislature on the whole has discharged its constitutional duty.

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For these reasons, we conclude that the lower courts erred in dismissing the plaintiffs’ action on the pleadings. The judgment of the court of appeals is reversed and the case is remanded to the trial court for further proceedings consistent with this opinion.

Justice ENOCH filed a concurring opinion. Justice SMITH filed a dissenting opinion.

1 . Tex Const, art. VIII, § 1-e.

2 . Carrollton-Farmers Branch Indep. Sch. Dist. v. Edgewood Indep. Sch. Dist., 826 S.W.2d 489, 502 (Tex. 1992) ¡Edgewood III].

3 . Edgewood Indep. Sch. Dist. v. Meno, 917 S.W.2d 717, 738 (Tex.1995) [Edgewood IV].

4 . Id.

5 . 78 S.W.3d 529 (Tex.App.-Austin 2002).

6 . Edgewood Indep. Sch. Dist. v. Kirby, 777 S.W.2d 391 (Tex. 1989) [.Edgewood 7]; Edge-wood Indep. Sch. Dist. v. Kirby, 804 S.W.2d 491 (Tex.1991) [Edgewood II]; Edgewood III, supra note 2; Edgewood IV, supra note 3.

7 . Tex Const, art. VII, § 1.

8 . Mumme v. Mans, 120 Tex. 383, 40 S.W.2d 31, 36 (1931) (“Since the Legislature has the mandatory duty to make suitable provision for the support and maintenance of an efficient system of public free schools, and has the power to pass any law relative thereto, not prohibited by the Constitution, it necessarily follows that it has a choice in the selection of methods by which the object of the organic law may be effectuated. The Legislature alone is to judge what means are necessary and appropriate for a purpose which the Constitution makes legitimate.”).

9 . Edgewood II, 804 S.W.2d at 498.

10 . Edgewood I, 777 S.W.2d at 394; accord Edgewood IV, 917 S.W.2d at 736.

11 . Marbury v. Madison, 5 U.S. (1 Cranch) 137, 176-178, 2 L.Ed. 60 (1803) ("The powers of the legislature are defined and limited; and that those limits may not be mistaken or forgotten, the constitution is written. To what purpose are powers limited, and to what purpose is that limitation committed to writing, if these limits may, at any time, be passed by those intended to be restrained? ... So if a law be in opposition to the constitution; if both the law and the constitution apply to a particular case, so that the court must either decide the case conformably to the law, disregarding the constitution; or conformably to the constitution, disregarding the law; the court must determine which of these conflicting rules governs the case. This is of the very essence of judicial duty.”); Love v. Wilcox, 119 Tex. 256, 28 S.W.2d 515, 520 (1930) (“Since Marbury v. Madison, [5 U.S. (1 Cranch) 137, 166-167 (1803)], the courts of last resort of the several states have almost universally followed the opinion of Chief Justice Marshall to the effect that it is clear that: ‘Where a specific duty is assigned by law, and individual rights depend upon the performance of that duty, ... the individual who considers himself injured, has a right to resort to the laws of his country for a remedy.’ ”).

12 . Edgewood IV, 917 S.W.2d at 726 ("This Court’s role under our Constitution’s separation of powers provision should be one of restraint. We do not dictate to the Legislature how to discharge its duty. As prominent as this Court’s role has been in recent years on this important issue, it is subsidiary to the constitutionally conferred role of .the Legislature. The people of Texas have themselves set the standard for their schools. Our responsibility is to decide whether that standard has been satisfied, not to judge the wisdom of the policy choices of the Legislature, or to impose a different policy of our own choosing.”).

13 . Edgewood I, 777 S.W.2d at 392; Edgewood II, 804 S.W.2d at 495; Edgewood III, 826 S.W.2d at 496; Texas Legislative Budget Board, Financing Public Education in Texas Kindergarten Through Grade 12 Legislative Primer at 25-26 (2d ed.2000) [hereinafter LBB Primer],

14 . EdgewoodII, 804 S.W.2d at 495.

¹⁵

16 . Edgewood I, 111 S.W.2d at 392.

17 . Edgewood II, 804 S.W.2d at 495.

18 . Act of June 2, 1969, 61st Leg., R.S., ch. 889, § 1, 1969 Tex. Gen. Laws 2735, 2895-2896.

19 . See Act of May 17, 1945, 49th Leg., R.S., ch. 304, § 1, 1945 Tex. Gen. Laws 488.

20 . Tex. Const, art. VII, § 5(a) ("The principal of all bonds and other funds, and the principal arising from the sale of lands hereinbefore set apart to said school fund, shall be the permanent school fund, and all the interest derivable therefrom and the taxes herein authorized and levied shall be the available school fund. The available school fund shall be applied annually to the support of the free public schools.”).

21 . Edgewood II, 804 S.W.2d at 495 n. 10.

²²

²³

24 . Id. ("Of total education costs, the state provides about forty-two percent, school districts provide about fifty percent, and the remainder comes from various other sources including federal funds.”); see LBB Primer, supra note 13, at 1 ("For the 2000-01 biennium, state taxes are estimated to generate approximately 44 percent of the total funds and local school district property taxes 47.5 percent of the total. The federal government provides approximately 8.5 percent of the revenue, most of it earmarked for specific federal education programs.”).

25 .Edgewood I, 111 S.W.2d at 392-393; LBB Primer, supra note 13, at 6 (stating, as of 2000: "There are 1,035 school districts in the state. The tax base among these districts varies considerably. Kenedy County Wide ISD has more than $3 million in property wealth per enrolled student, while Boles ISD has less than $10,000 in property wealth per enrolled student.”).

26 . Edgewood I, 111 S.W.2d at 392; see LBB Primer, supra note 13, at 21 (stating, as of 2000: "The number of districts subject to the recapture provisions range from 85 to 100 in a given year. The associated recapture revenue is anticipated to total $949.8 million in the 2000-01 biennium.”).

27 . Edgewood I, 111 S.W.2d at 392-393.

28 . Id. at 395 (citations omitted).

29 . Id. at 397.

30 . Id. at 398.

31 . Id. at 399; accord Edgewood II, 804 S.W.2d at 493.

32 . Edgewood I, 111 S.W.2d at 399.

³³

³⁴

35 . Id. at 496.

36 . Id. at 495 n. 11 (“The question of local enrichment continues to be controlled by this Court’s opinion in Edgewood I, 777 S.W.2d at 397-98.”).

37 . Id. at 500 (emphasis in original) (citation and footnotes omitted).

38 . Edgewood III, 826 S.W.2d at 492.

39 . Id. at 498.

⁴⁰

41 . Id. at 500.

42 . Id. (citation and footnote omitted).

43 . Id. at 502-503.

44 . Id. at 506; see Tex Const, art. VII, § 3(e) ("The Legislature shall be authorized to pass laws for the assessment and collection of taxes in all school districts and for the management and control of the public school or schools of such districts, whether such districts are composed of territory wholly within a county or in parts of two or more counties, and the Legislature may authorize an additional ad valorem tax to be levied and collected within all school districts for the further maintenance of public free schools, and for the erection and equipment of school buildings therein; provided that a majority of the qualified voters of the district voting at an election to be held for that purpose, shall approve the tax.”).

45 . Edgewood III, 826 S.W.2d at 522-523.

46 . Tex. H.J. Res. 10, HJ. of Tex., 73rd Leg., R.S. 184 (1993).

47 . Tex. S.J. Res. 7, 73rd Leg., R.S., 1993 Tex. Gen. Laws 5560 (passed Senate 27-4 and House 102-43).

48 . Votes on Proposed Amendments to the Texas Constitution 1875-May, 1993, at 27, reprinted in [4] 1993 Tex. Gen. Laws (amendment submitted May 1, 1993, defeated 755,417 to 1,293,224); Edgewood TV, 917 S.W.2d at 727.

49 . Act of May 28, 1993, 73rd Leg., R.S., ch. 347, 1993 Tex. Gen. Laws 1479 [hereinafter Chapter 347]; see Edgewood IV, 917 S.W.2d at 727.

50 . Edgewood TV, 917 S.W.2d at 727.

51 . LBB Primer, supra note 13, at 2.

52 . Edgewood TV, 917 S.W.2d at 727 (quoting former Tex Educ.Code § 16.002(b), Chapter 347, supra note 49, at 1492, now Tex Educ. Code § 42.002(b)(1)(A)); see LBB Primer, supra note 13, at 2.

53 . Chapter 347, supra note 49, at 1498 (codifying former Tex. Educ.Code § 16.101).

54 . Tex Educ.Code § 42.101.

55 . LBB Primer, supra note 13, at 14 — 16.

56 . Edgewood TV, 917 S.W.2d at 727 (citing former Tex. Educ.Code § 16.254, Chapter 347, supra note 49, at 1509 1511); see LBB Primer, supra note 13, at 2.

57 . See Edgewood IV, 917 S.W.2d at 731 n. 10 ("Based on the evidence at trial, the district court found that meeting accreditation standards, which is the legislatively defined level of efficiency that achieves a general diffusion of knowledge, requires about $3,500 per weighted student.’’).

58 . See LBB Primer, supra note 13, at 2.

59 . Edgewood IV, 917 S.W.2d at 728 (citing former Tex. Educ.Code § 16.302, Chapter 347, supra note 49, at 1514).

60 . Tex. Educ.Code § 42.302; see LBB Primer, supra note 13, at 16-17.

61 . Edgewood IV, 917 S.W.2d at 728 (citing former Tex Educ.Code § 16.303, Chapter 347, supra note 49, at 1514); Tex Educ.Code §§ 42.303, 45.003(d).

62 . See LBB Primer, supra note 13, at 2, 19-20.

63 . Edgewood IV, 917 S.W.2d at 728 (citing former Tex. Educ.Code § 36.002, Chapter 347, supra note 49, at 1480); Chapter 347, supra note 49, at 1479 (codifying former Tex. Educ. Code § 36.001); Tex. Educ.Code §§ 41.001-.002; LBB Primer, supra note 13, at 20-21.

64 . Edgewood IV, 917 S.W.2d at 728 (citing former Tex. Educ.Code § 36.002, Chapter 347, supra note 49, at 1480).

65 . Tex Educ.Code § 41.002; LBB Primer, supra note 13, at 21.

66 . Edgewood IV, 917 S.W.2d at 728 (citing former Tex. Educ.Code §§ 36.003-004, Chapter 347, supra note 49, at 1480); Tex Educ. Code §§ 41.003-.004 (requiring that a school district with excess wealth per student effectuate a reduction by one or more of the following: consolidation with another district, detachment of territory, purchase of average daily attendance credit, education of nonresident students, or tax base consolidation); LBB Primer, supra note 13, at 21.

67 . LBB Primer, supra note 13, at 21.

68 . Edgewood IV, 917 S.W.2d at 729-730 (emphasis in original).

69 . Id. at 730; accord id. at 731 ("The State's duty to provide districts with substantially equal access to revenue applies only to the provision of funding necessary for a general diffusion of knowledge.”).

70 . Id. at 730.

71 . Id. at 730 n. 8 (citation omitted).

72 . Id. at 732 (emphasis in original).

73 . Id. at 732 n. 14; cf. Mumme v. Mans 120 Tex. 383, 40 S.W.2d 31, 36 (1931) (“The word 'suitable,' used in connection with the word 'provision' in this section of the Constitution, is an elastic term, depending upon the necessities of changing times or conditions, and clearly leaves to the Legislature the right to determine what is suitable, and its determination will not be reviewed by the courts if the act has a real relation to the subject and object of the Constitution.” (citation omitted)).

74 . Edgewood IV, 917 S.W.2d at 731 (footnote omitted).

75 . Id. at 738.

76 . Id. at 726.

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78 . See Act of May 27, 1995, 74th Leg., R.S., ch. 260, 1995 Tex. Gen. Laws 2207; Act of June 1, 1997, 75th Leg., R.S., ch. 1071, 1997 Tex. Gen. Laws 4087; Act of May 30, 1999, 76th Leg., R.S., ch. 396, 1999 Tex. Gen. Laws 2471; Act of May 28, 2001, 77th Leg., R.S., ch. 1187, 2001 Tex. Gen. Laws 2667.

79 . Texas Legislative Budget Board, Financing Public Education in Texas Kindergarten Through Grade 12 Legislative Primer at 1 (3d ed.2001).

80 . Edgewood IV, 917 S.W.2d at 725.

81 . West Orange-Cove Consolidated I.S.D., Coppell I.S.D., La Porte I.S.D., and Port Neches-Groves I.S.D.

82 . See supra note 75 and accompanying text.

83 .Felipe Alanis, in his official capacity as the Commissioner of Education; Texas Education Agency; Carol Keeton Strayhom, in her official capacity as Texas Comptroller of Public Accounts; and Texas State Board of Education.

84 . Edgewood I.S.D., Ysleta I.S.D., Laredo I.S.D., San Elizario I.S.D., Soccorro I.S.D., and South San Antonio I.S.D.

85 . Alvarado I.S.D., Anthony I.S.D., Aubrey I.S.D., Bangs I.S.D., Bells I.S.D., Community I.S.D., Cooper I.S.D., Covington I.S.D., Detroit I.S.D., Early I.S.D., Fannindel I.S.D., Hutto I.S.D., Karnes City I.S.D., Kaufman I.S.D., Kirbyville I.S.D., Krum I.S.D., La Joya I.S.D., Mercedes I.S.D., Meridian I.S.D., New Boston I.S.D., Nocona I.S.D., Olfen I.S.D., Orange Grove I.S.D., Poteet I.S.D., Robinson I.S.D., Rosebud-Lott I.S.D., Rusk I.S.D., Southside I.S.D., Tornillo I.S.D., Trenton I.S.D., Tulia I.S.D., Uvalde I.S.D., Venus I.S.D., and Weaterford I.S.D.

86 . The trial court stated in its order: “The changed-circumstances warning in Edgewood IV appears to be obiter dictum. Should the Supreme Court consider the present case, this court respectfully urges a reconsideration of this dictum. For the reasons cited, the court has concerns about the historical and analytical foundations of this dictum. Of course, dictum or not, the court today has faithfully followed the teachings of the Supreme Court, heeded the changed-circumstances warning, and applied the meaningful-discretion test.”

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88 . Id. at 542 (emphasis in original).

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91 . Id. at 539.

⁹²

93 . Id. at 540 (emphasis in original).

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95 . Id. at 542.

96 . 46 Tex. Sup.Ct. J. 426, 428 (Feb. 13, 2003).

97 . Edgewood III, 826 S.W.2d at 502.

98 . See Tex Tax Code § 1.04(12).

99 . Edgewood III, 826 S.W.2d at 501.

100 . See Friesenhahn v. Ryan, 960 S.W.2d 656, 658 (Tex. 1998).

101 . Edgewood III, 826 S.W.2d at 502-503.

102 . Id. at 502.

103 . Edgewood. TV, 917 S.W.2d at 730 n. 8.

104 . Id. at 736.

105 . Id. at 735.

106 . Tex Educ.Code § 39.072.

107 . Id. §§ 39.091-, 112.

108 . Id. § 39.131; see Edgewood IV, 917 S.W.2d at 729 ("Districts that chronically fail to maintain accreditation standards are subject to penalties, including dissolution of the offending school district and its annexation to another district.”).

109 . Edgewood IV, 917 S.W.2d at 738.

¹¹⁰

111 . See note 86 supra.

112 . See Seminole Tribe of Fla. v. Florida, 517 U.S. 44, 67, 116 S.Ct. 1114, 134 L.Ed.2d 252 (1996) (“ ‘Although technically dicta, ... an important part of the Court's rationale for the result it reache[s] ... is entitled to greater weight_’ ” (quoting Sheet Metal Workers v. Equal Employment Opportunity Comm'n, 478 U.S. 421, 490, 106 S.Ct. 3019, 92 L.Ed.2d 344 (1986) (O'Connor, J., concurring))).

113 . Tex. Const, art. VII, § 1.

114 . Tex. Educ.Code § 4.001(a).

115 . Edgewood IV, 917 S.W.2d at 730 ("In Senate Bill 7, the Legislature equates the provision of a ‘general diffusion of knowledge’ with the provision of an accredited education. The accountability regime set forth in Chapter 35, we conclude, meets the Legislature's constitutional obligation to provide for a general diffusion of knowledge statewide.”).

116 . Id. at 732 n. 14.

117 . Id. at 730 n. 8 ("This is not to say that the Legislature may define what constitutes a general diffusion of knowledge so low as to avoid its obligation to make suitable provision imposed by article VII, section 1. While the Legislature certainly has broad discretion to make the myriad policy decisions concerning education, that discretion is not without bounds.”).

118 . 78 S.W.3d 529, 540 (Tex.App.-Austin 2002).

119 . Tex Tax Code § 11.13(b)-(c).

120 . Id. § 11.13(d)-©, (n).

121 . Texas Ass'n of Bus. v. Texas Air Control Bd., 852 S.W.2d 440, 445-446 (Tex.1993).

122 . 925 S.W.2d 659, 661-662 (Tex.1996) (citing Robbins v. Limestone County, 114 Tex. 345, 268 S.W. 915, 917 (1925) (holding that county and road districts can sue the state highway commission on the ground of the invalidity of statutes)).

123 . Id. at 662 (citations omitted).

¹²⁴

125 . 120 Tex. 383, 40 S.W.2d 31, 36 (1931) (‘‘The legislative determination of the methods, restrictions, and regulations is final, except when so arbitrary as to be violative of the constitutional rights of the citizen.”).