Court of Appeals of Indiana | Opinion 18A-PL-2634 | September 24, 2019 Page 1 of 18

ATTORNEYS FOR APPELLANTS

Curtis T. Hill, Jr.

Attorney General of Indiana

Natalie F. Weiss

Frances Barrow

Deputy Attorneys General

Indianapolis, Indiana

ATTORNEYS FOR APPELLEE

INDIANA CONNECTIONS 

ACADEMY, INC.

Wayne C. Turner

Michael R. Limrick

Amanda L.B. Mulroony

Hoover Hull Turner LLP

Indianapolis, Indiana

ATTORNEYS FOR APPELLEE 

ANDREW J. BROWN CHARTER 

SCHOOL, INC., ASPIRE CHARTER 

ACADEMY, INC., AND NATIONAL 

HERITAGE ACADEMIES, INC.

Alan S. Brown

Darren A. Craig

Alexander P. Will

Indianapolis, Indiana

I N T H E

COURT OF APPEALS OF INDIANA

State of Indiana; Indiana 

Department of Education; Eric 

Holcomb, in his official capacity 

as Governor of Indiana; and 

Jennifer McCormick, in her 

official capacity as Indiana 

Superintendent of Public 

Instruction,

September 24, 2019

Court of Appeals Case No.

18A-PL-2634

Appeal from the Marion Superior 

Court

The Honorable Heather A. Welch, 

Judge
Court of Appeals of Indiana | Opinion 18A-PL-2634 | September 24, 2019 Page 2 of 18

Appellants-Defendants,

v.

Indiana Connections Academy, 

Inc.; Rural Community Schools; 

Andrew J. Brown Charter 

School, Inc.; Aspire Charter 

Academy, Inc.; and National 

Heritage Academies, Inc.,

Appellees-Plaintiffs

Trial Court Cause No.

49D01-1606-PL-20822

Baker, Judge.

[1] Indiana Connections Academy, Inc. (INCA), Andrew J. Brown Charter 

School, Inc. (AJB), Aspire Charter Academy, Inc. (Aspire), and National 

Heritage Academies, Inc. (NHA) (collectively, the Charter Schools), instituted 

litigation against the State, seeking to recover six months of tuition support 

funding that they argue they are owed. 

[2] The trial court ruled in favor of the Charter Schools and the State appeals, 

raising multiple arguments, one of which we find dispositive: that the trial court 

erroneously determined that the tuition support funding formula resulted in a 

six-month funding lag. We find as a matter of law that the General Assembly 

did not intend the statutory funding formula to result in a six-month funding 

lag, meaning that the Charter Schools are not entitled to recover the disputed 

amounts. Therefore, we reverse and remand with instructions to enter 

judgment in favor of the State.
Court of Appeals of Indiana | Opinion 18A-PL-2634 | September 24, 2019 Page 3 of 18

Facts1

Charter School Funding From 2002-2013

[3] In 2001, the General Assembly enacted the Charter School Act (the Act) to 

provide an alternative option to traditional public schools. Ind. Code art. 20-

24. A charter school is a nonreligious public elementary or secondary school 

that operates under a charter, which is a “contract between an organizer and an 

authorizer for the establishment of a charter school.” Appellants’ App. Vol. VI 

p. 58. An “organizer” is a nonprofit group that enters into the contract to 

operate the charter school, id. at 59, and an “authorizer” is an entity enabled 

under the Act to grant a charter to an organizer to operate a charter school, Ind. 

Code §§ 20-24-1-2.5, 20-24-3-1. 

[4] Because charter schools are considered public schools, which may not charge 

tuition to their students, the State provides tuition support on behalf of their 

students. Each two-year budget cycle, the General Assembly determines the 

amount of tuition support to be divided among and distributed to all public 

schools, including charter schools. The Indiana Department of Education 

(DOE) is tasked with the ministerial duty of distributing the tuition support 

funds. The amount of support is determined annually by the DOE and is based 

on the Average Daily Membership (ADM) of a charter school.

 

1 We held oral argument in Indianapolis on September 9, 2019. We thank the attorneys for all parties for 

their superb written and oral advocacy.
Court of Appeals of Indiana | Opinion 18A-PL-2634 | September 24, 2019 Page 4 of 18

[5] Before 2013, charter schools conducted their ADM count in September. They 

received tuition from the State for their students on a calendar year basis, with 

the first monthly distribution occurring in January and the final distribution 

occurring in December. Thus, the ADM count conducted in September 

triggered a payment stream that began in January. Before 2013, the law 

provided that the DOE would not make the first distribution of state tuition 

support until “after December 31 of the calendar year in which a charter school 

begins its initial operation.” I.C. § 20-24-7-2(b) (2011). In other words, a new 

charter school that opened its doors in the autumn of an academic year would 

receive its first DOE tuition support payment the following January.

[6] This system created financial hardship for new charter schools, which, unlike 

traditional public schools, do not have the authority to levy local taxes. When 

the DOE realized that there was a funding gap for new charter schools, it 

requested an advisory opinion from the Attorney General in 2002 (the Advisory 

Opinion). In relevant part, the Advisory Opinion states as follows:

. . . It cannot be assumed that the General Assembly intended to 

have the new public schools operate without state tuition funds 

absent clear language to that effect in the Charter School Act. 

Therefore, the [DOE] is required both to distribute tuition 

support and other state funding upon verification of the required 

information from the charter school organizer and to make full 

state tuition payments to public school corporations.

***
Court of Appeals of Indiana | Opinion 18A-PL-2634 | September 24, 2019 Page 5 of 18

. . . Any analysis of charter school funding requirements must 

begin with the basic and irrefutable fact that charter schools are 

public schools, “wherein tuition shall be without charge.”

***

In the absence of a specific legislative directive which indicates 

that charter schools must operate without state tuition support 

during the first semester of operation, one may only conclude 

that charter schools, like all other public schools, are required to 

be funded with public funds during the first semester of a school 

year. Indeed, any other reading would require the inference that 

the General Assembly intended charter schools with inadequate 

private start-up monies to never open.

***

. . . Of equal importance is the fact that the General Assembly 

did not provide that charter schools specifically be required to 

operate without state tuition funding during the first semester 

they are in operation.

***

The fact that an already-existing school corporation must wait 

until January for funding adjustments based on September’s 

ADM does not support the argument by correlation that a charter 

school must wait until January for any state tuition support.

***

. . . [T]he statutory framework established by the General 

Assembly has an inherent time lag of roughly one semester 

between the time a public school starts a school year and the time 
Court of Appeals of Indiana | Opinion 18A-PL-2634 | September 24, 2019 Page 6 of 18

it receives a distribution of state tuition support based on 

September ADM.

***

I am fully aware that the General Assembly has created what 

may be termed an “unfunded legislative mandate.” It has 

created a new variety of public school without either (1) 

addressing the fiscal impact these schools may have on 

entitlements to existing school corporations, or (2) expressing an 

intent that charter schools will not receive state tuition support 

during the first semester of operations.

It is possible, given current budget projections, that the 

appropriations cap set by the General Assembly in 2001 may be 

inadequate. This is an issue that the General Assembly created, 

and one that may require its action to remedy.

The [DOE] may find in the performance of its ministerial duties 

that it is impossible to satisfy the State’s financial obligations to 

all public schools as required by the General Assembly. In such 

an event, the General Assembly must supply the [DOE] with the 

necessary funds to satisfy these obligations. . . .

Therefore, . . . it is my legal opinion that the Charter School Act 

obligates the [DOE] to distribute tuition support and other state 

funding upon verification of the required information from the 

charter school organizer . . . .

Appellants’ App. Vol. IV p. 83-88 (emphases original, internal citations 

omitted).
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[7] In the 2003 legislative session after the Advisory Opinion was issued, the 

General Assembly declined to amend the statute providing that the DOE could 

not make the first distribution of state tuition support until after December 31 of 

the calendar year in which a charter school begins its initial operation. It also 

did not supply the DOE with the necessary funds to enable payment of tuition 

support for the first semester of new charter schools. Instead, it created the 

Charter School Advancement Account, which was essentially a government 

loan available for charter schools to cover operational costs incurred during 

their opening semester. Ind. Code §§ 20-5.5-7.5-5, -6 (2003).

Parties’ Interpretations

[8] Although we generally do not inject argument into the Facts section of our 

opinions, we believe it would be helpful in this case to explain the parties’ 

respective interpretations of what the above statutory scheme means in practical 

terms.

[9] The State believes that it means that charter schools are wholly unfunded for 

the first semester they are open. Then, beginning in January, they would 

receive monthly payments based on the ADM count from September, but the 

tuition support funds would not cover the first semester; instead, they would be 

real-time payments.

[10] The Charter Schools, on the other hand, argue that this process merely resulted 

in a funding lag:
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Under this methodology, a school would submit an ADM from

the September count date, and then IDOE would distribute each 

school’s tuition support in 12 roughly equal monthly payments in 

the following calendar year. Thus, by way of example, a school 

would submit its September ADM and IDOE would distribute 

12 monthly payments from January through December of the 

following calendar year.

AJB, Aspire, NHA Appellees’ Br. p. 11 (internal citations omitted). Thus, the 

Charter Schools insist that this system resulted in a six-month funding lag. 

INCA offered this example by way of explanation: “schools did not receive all 

the tuition support for the 2011-12 school year—the tuition support tied to its 

fall 2011 ADM—until December 2012 (halfway through the 2012-13 school 

year).” INCA Appellee’s Br. p. 11.

Charter School Funding After 2013

[11] Effective July 1, 2013, the General Assembly changed the tuition support 

payment schedule from a calendar year (January through December) to the 

State’s fiscal year (July through June). From that date forward, charter schools 

would conduct two ADM counts, one in September and one in February. 

Viewed through the lens of the Charter Schools’ interpretation of the former 

legislative scheme, this change meant that there would no longer be a funding 

lag; viewed through the lens of the State’s position, the change meant that the 

first semester of operation would no longer be unfunded.
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[12] When that law went into effect, charter schools had completed the 2012-2013 

school year and had received tuition support through the end of Spring 2013 

based on the September 2012 ADM count.

[13] The DOE explained in a memorandum that the September 2013 ADM count 

would be used to determine tuition support funding from July 1 through 

December 31, 2013. After the September 2013 ADM count was finalized, the 

DOE reconciled any remaining payments in November and December to 

account for any over or underpayments of tuition support.

[14] The DOE continued to use the September 2013 ADM count until the February 

2014 ADM count was finalized, which, in turn, was used to determine the 

tuition support funding for January 1 through June 30, 2014. Again, after the 

February ADM count was finalized, the DOE accounted for any over or 

underpayments of tuition support. 

[15] In short, charter schools were provided tuition support during this transitional 

period as follows:

• First half of 2013: under the pre-July 1, 2013, statutes, based on the 

September 2012 ADM count.

• Second half of 2013: under the 2013 law, based on the September 2013 

ADM count.

• First half of 2014: under the 2013 law, based on the February 2014 

ADM count.

• Second half of 2014 and beyond: as prescribed by the 2013 law.

Therefore, charter schools were paid tuition support for all times during the 

transition from the prior statute to the new one.
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[16] This transitional period, however, did not account for the six-month funding lag 

that the Charter Schools believe was occurring in the prior legislative scheme. 

Thus, they argue that the State still owes them tuition support funds for a full 

semester.

The Parties and the Litigation

[17] Indiana Connections Academy began operating in the 2010-2011 school year as 

part of a Virtual School Pilot Program.2 It began receiving basic tuition support 

in January 2011 based on its September 2010 ADM count. When the pilot 

program ended, the academy applied to become a charter school. In December 

2011, INCA entered into a charter agreement with Ball State University to 

establish and operate Indiana Connections Academy. INCA became the 

organizer of Indiana Connections Academy in January 1, 2012.

[18] In 2003, AJB entered into a charter agreement with the City of Indianapolis. 

AJB began educating students in August 2003 and received its first tuition 

support payments in February 2004 based on its September 2003 ADM count. 

In March 2008, Aspire entered into a charter agreement with Ball State 

University. It began educating students in August 2008 and received its first 

tuition support payments in January 2009 based on its September 2008 ADM 

count. Through a contractual arrangement, NHA operates AJB and Aspire.

 

2 The Academy’s organizer and fiscal agent under the pilot program was Rural Community Schools (Rural). 

When it was decided that the Academy would apply to become a full-fledged charter school, it transitioned 

from Rural to INCA as its organizer.
Court of Appeals of Indiana | Opinion 18A-PL-2634 | September 24, 2019 Page 11 of 18

[19] Each of the Charter Schools has received continuous tuition support from the 

DOE except for their respective first semesters of operation. They all argue that 

the 2013 transitional period did not account for their first six months of 

operation and maintain that they should be compensated for that semester. 

[20] On June 10, 2016, INCA filed a complaint against the State for breach of 

contract and declaratory judgment. In its answer, the State asserted 

counterclaims for unjust enrichment and negligence and filed a third-party 

complaint against Rural. INCA and Rural both filed motions to dismiss. On 

October 24, 2017, the trial court granted the motions to dismiss the negligence 

counterclaim and denied the motion to dismiss the unjust enrichment 

counterclaim and the third-party complaint.

[21] In August 2017, AJB, Aspire, and NHA filed a motion for permissive 

intervention and a complaint against the State for mandate, damages, and 

declaratory, injunctive, and equitable relief. The trial court granted the motion 

for permissive intervention.

[22] In June 2018, INCA and Rural filed a joint motion for summary judgment and 

NHA, Aspire, and AJB filed a joint motion for summary judgment. The State 

filed a cross-motion for summary judgment. On October 2, 2018, the trial court

denied the State’s cross-motion for summary judgment. It granted the Charter 

Schools’ summary judgment motions with respect to their implied contract 
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claims and denied their motions with respect to their express contract claims 

and claims for prejudgment interest.3 

[23] The State now appeals the grant of summary judgment in favor of the Charter 

Schools. The Charter Schools, in turn, cross-appeal the trial court’s order 

regarding their express contract claims and argue that they are entitled to 

statutory late payment penalties and prejudgment interest. INCA also argues 

that the trial court erred in calculating the amount of damages it is owed.

Discussion and Decision

[24] The State argues that (1) the Charter Schools received all the funding they were 

owed because there was no funding lag; (2) the trial court erroneously 

determined that there were implied contracts between the State and the Charter 

Schools; (3) there were no express contracts between the State and the Charter 

Schools; (4) there is no constitutional provision supporting the Charter Schools’ 

claims; and (5) the Charter Schools are not owed interest, penalties, 

prejudgment interest, a mandate, or recovery on an unjust enrichment claim. 

As we find the first argument dispositive, we will not consider the remaining

issues or the Charter Schools’ cross-appeal.

[25] Our standard of review on summary judgment is well established:

 

3 The trial court also awarded summary judgment in favor of INCA and Rural on the State’s unjust 

enrichment claim. The State does not appeal that portion of the order, meaning that Rural is no longer part 

of the case.
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We review summary judgment de novo, applying the same 

standard as the trial court: “Drawing all reasonable inferences in 

favor of . . . the non-moving parties, summary judgment is 

appropriate ‘if the designated evidentiary matter shows that there 

is no genuine issue as to any material fact and that the moving 

party is entitled to judgment as a matter of law.’” Williams v. 

Tharp, 914 N.E.2d 756, 761 (Ind. 2009) (quoting T.R. 56(C)). “A 

fact is ‘material’ if its resolution would affect the outcome of the 

case, and an issue is ‘genuine’ if a trier of fact is required to 

resolve the parties’ differing accounts of the truth, or if the 

undisputed material facts support conflicting reasonable 

inferences.” Id. (internal citations omitted).

Hughley v. State, 15 N.E.3d 1000, 1003 (Ind. 2014).

[26] The interpretation of a statute is a question of law to which we apply a de novo 

standard of review. Kaser v. Barker, 811 N.E.2d 930, 932 (Ind. Ct. App. 2004). 

[27] The crux of the State’s argument is that the public school funding law in effect 

until July 2013 did not provide for any tuition support during a new public 

school’s first semester of operation. Because there is no dispute that the Charter 

Schools received tuition support for all but one semester of operation, the State 

argues that they have received all monies they are owed. The trial court found 

that the tuition support funding that begins in January of a charter school’s first 

year of operation covered the education provided during the previous Fall 

semester. In other words, it was tuition support funding in arrears. 

[28] We agree with the State that there is no statutory authority suggesting that this 

funding lag, in fact, existed: “payments were made in real time, for the present 
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semester, but based on information from the previous September.” Appellant’s 

Br. p. 22.4

[29] The trial court found, essentially, that the Charter Schools were owed twelve 

months of tuition support based on the September 2012 ADM count. Because 

of the change in the funding formula halfway through 2013, which (according 

to the trial court and the Charter Schools) did not account for the second six 

months of tuition owed, the Charter Schools are entitled to receive those funds. 

We agree with the State that this is a fundamental misunderstanding of the 

prior funding formula: 

the old funding formula never guaranteed two full semesters of 

tuition support based on a September ADM. Under the old 

formula schools received twelve months of funding based on the 

previous September’s ADM, but only because payments were based 

on a calendar year. As of July 2013, tuition support for the fall 

semester would be based on the September 2013 (not the 

September 2012 ADM), and would be paid on a fiscal year basis.

Appellant’s Br. p. 29 (emphasis added).

[30] We also note that as a practical matter, budgets are prospective rather than 

retrospective. Each two-year budget covers only those two years and cannot 

reach back to the past to make payments in arrearage. Moreover, if an agency 

 

4 By contrast, the new tuition support funding law effective July 2013 provides for the ADM count to be 

reported in both September and February, meaning that the necessary information to calculate tuition 

support is now being provided for the current semesters.
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such as the DOE has money left over at the end of a two-year cycle, that money 

reverts to the State. Consequently, a six-month funding lag would not fit into 

Indiana’s budgeting process.

[31] Because there was no so-called funding lag, it is apparent that the Charter 

Schools received tuition support funding on a real-time basis. The DOE 

distributed those funds continuously throughout the transitional period. 

Therefore, the evidence undisputedly shows that they have received all funds to 

which they are entitled.

[32] Adding support to this conclusion is the Advisory Opinion, which provided the 

Attorney General’s policy suggestion that the legislature provide funding for a 

charter school’s first semester of operations. But following the issuance of this 

opinion, the General Assembly did not make that change. Instead, the General 

Assembly created a program whereby a new charter school could apply for a 

government loan to help it through its first semester of operation, meaning that 

it did not—as advocated for by the Attorney General—provide the DOE with 

the necessary funds or authorization to pay tuition for that first semester.

[33] We acknowledge that this result may seem unfair. As noted by counsel at oral 

argument, this result penalizes charter schools that had the financial 

wherewithal to operate without State assistance for their first semester. 

Specifically, charter schools that had to seek a loan from the State under the 

Advancement Account ultimately had those loans forgiven, whereas the 

schools that financed their own first semesters are left holding the proverbial 
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bag with no recourse for recouping those funds. It may also seem unfair that 

the State expected charter schools to open and operate for a full semester with 

no tuition support from the government.

[34] But regardless of whether the process and result are fair or unfair, it is solidly 

within the wheelhouse of the legislature to create a statewide budget and to 

decide how to fund charter schools, which are a creation of the General 

Assembly to begin with. The General Assembly has the discretion to decide 

how to allocate State funds. In this case, it initially decided not to fund the first 

semester of charter schools’ operations. Neither the fact that it decided in 2013 

to change that formula nor the fact that the outcome may seem unfair means

that there was actionable error in the initial budgeting process.

[35] In sum, while the Charter Schools may argue that it is bad public policy for the 

legislature to have decided that charter schools should not be funded for their 

first semester of operation, that does not change the language of the relevant 

public law, which does not provide for the so-called funding lag. There is no 

statute providing that the tuition payments beginning in January paid for public 

education provided the previous fall.

[36] As a final issue, we must address the Charter Schools’ argument that the State’s 

interpretation of the tuition support funding formula is unconstitutional because 

“Article 8, Section 1 requires the State to provide complete tuition support—not 

tuition support except for one semester. The State cannot abrogate that 

constitutional duty by statute.” AJB, Aspire, NHA Appellees’ Br. p. 26. They 
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insist that the only way in which the tuition support funding formula is 

constitutional is if we interpret it to impose the so-called funding lag, meaning 

that charter schools are entitled to tuition support funding for every semester of 

operation, albeit on a one-semester lag. Were we to agree with the State’s 

interpretation, the Charter Schools argue that it would shift onto them the 

General Assembly’s constitutional duty to provide tuition-free public education.

[37] Initially, we note that the Indiana Constitution does not confer a private right of 

action for monetary damages. E.g., City of Indianapolis v. Cox, 20 N.E.3d 201, 

212 (Ind. Ct. App. 2014); see also Hoagland v. Franklin Twp. Cmty. Sch. Corp., 27 

N.E.3d 737, 741 (Ind. 2015) (holding that Indiana’s Education Clause does not 

provide a private right of action for monetary damages). 

[38] Nevertheless, we observe that while the State is obligated to provide a tuitionfree education for Hoosier children, it necessarily fulfills that obligation in the 

guise of traditional public schools. In other words, even if the charter schools 

had to be self-funded for their first semester, and even if the charter schools had 

to close their doors as a result, the children of Indiana were always going to be 

able to obtain a tuition-free education at traditional public schools. Because 

traditional public schools have always been an option, the State did not violate 

any constitutional obligations by structuring its charter school tuition funding in 

a way that required those schools to fund their own first semesters. Therefore, 

this argument is unpersuasive.
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[39] In sum, from 2002-2013, the way in which the General Assembly structured

charter school tuition support resulted in a system requiring those schools to 

self-fund their first semesters of operation. Nothing in the budget for those 

years indicates that the legislature intended the tuition support payments to be 

made in arrears. It is within the purview of the legislature to structure its 

budgets, and nothing here suggests that it exceeded its discretion. As such, the 

trial court erred by determining that the Charter Schools are entitled to a 

semester’s worth of tuition support. Therefore, we reverse.

[40] The judgment of the trial court is reversed and remanded with instructions to 

enter judgment in favor of the State.

Vaidik, C.J., and Altice, J., concur.