Opinion ID: 619919
Heading Depth: 2
Heading Rank: 3

Heading: The State's Funding Obligations

Text: Under the 1989 settlement agreement, the State agreed to provide funding for an interdistrict remedy among the three districts. For example, the State must pay half the cost of operating magnet schools, the full cost of transporting students to those schools, a portion of teacher retirement and health benefits, and the cost of recruiting and transporting majority-to-minority student transfers. These obligations currently amount to about $38 million per year. The State has long made known its view that such funding will become unnecessary after all three districts are declared fully unitary. However, the State has not yet moved for relief from its funding obligations, and the scheduling order for the 2010 hearings on NLRSD's and PCSSD's petitions for declaration of unitary status did not provide for the presentation of any evidence regarding such relief. In addition, although the State participated in the hearings, it objected frequently that the State's own duties and obligations were not the subject of the hearings. Nevertheless, the district court sua sponte released the State from the funding obligations listed above, [10] finding this change necessary to avoid an absurd outcome in which the districts are rewarded with extra money from the state if they fail to comply with their desegregation plans and they face having their funds cut by the state if they act in good faith and comply. It did not make specific findings of fact to support the remedy, but rather stated in general terms that a carrot and stick approach would no longer work with these districts because the districts are wise mules that have learned how to eat the carrot and sit down on the job. Given that PCSSD is the only district involved that continues to show a broad lack of good faith, we presume that the district court was referring primarily to PCSSD. Of course, the termination of State funding heavily impacts LRSD and NLRSD as well. The district court's frustration is understandable, and its conclusions regarding the perverse incentives created by the State's funding may well have some merit. Nevertheless, notice and a formal hearing are required before the court terminates a constitutional violator's desegregation obligations. See Jenkins v. Missouri, 216 F.3d 720, 727 (8th Cir.2000). While the State correctly notes that the issue of termination of State funding was presented to the district court through other avenues, including briefing in response to a July 29, 2009 request for information from the district court and discussion at a September 30, 2009 status hearing, we have rejected the notion that such other avenues may substitute for a formal evidentiary hearing: As the Supreme Court admonished this court, where there is a need for detailed articulation of findings, we should not attempt to assemble an adequate record from the various reports that have been filed by the parties or by court-appointed committees followed by district court orders. See Missouri v. Jenkins, 515 U.S. 70, 100-02, 115 S.Ct. 2038, 132 L.Ed.2d 63 (1995) (requiring a hearing for determination of partial unitary status). Accordingly, we must remand the appealed orders to the district court for a formal hearing followed by comprehensive and detailed findings of fact and conclusions of law. Liddell, 121 F.3d at 1216. Similarly, the briefings and status hearing referred to by the State in this case cannot be cobbled together to form an adequate record, particularly in the absence of detailed findings by the district court. Instead, if the State wishes to obtain relief from its funding obligations, there must be a formal evidentiary hearing on the issue followed by comprehensive and detailed findings of fact and conclusions of law, as envisioned by Jenkins and Liddell. We express no opinion on what the outcome of such a hearing should be. In the absence of these procedures, the portion of the district court's order terminating the State's funding obligations under the 1989 Settlement Agreement is vacated.