Court Opinion

ID: 9916953
Source: CourtListenerOpinion
Date Created: 2024-01-10 21:08:06.768768+00
Date Added: 2024-06-11T13:26:11.023273
License: Public Domain

01/10/2024
                 IN THE COURT OF APPEALS OF TENNESSEE
                             AT NASHVILLE
                           Assigned on Briefs November 1, 2023

THE METROPOLITAN GOVERNMENT OF NASHVILLE & DAVIDSON
COUNTY, ET AL. v. TENNESSEE DEPARTMENT OF EDUCATION, ET AL.

                 Appeal from the Chancery Court for Davidson County
                 No. 20-143-II, 20-242-II Anne C. Martin, Chancellor1

                                No. M2022-01786-COA-R3-CV

This appeal concerns a lawsuit challenging the Tennessee Education Savings Account Pilot
Program, Tenn. Code Ann. § 49-6-2601, et seq. (“the ESA Act”). A group of parents and
taxpayers from Davidson and Shelby Counties (“Plaintiffs”) sued state officials (“State
Defendants”) in the Chancery Court for Davidson County (“the Trial Court”). In their
operative amended complaint, Plaintiffs alleged that the ESA Act violates the Tennessee
Constitution and state law by diverting taxpayer funds appropriated for public schools in
Davidson and Shelby Counties to private schools, resulting in unique harm to these
localities. A group of parents with children eligible for the ESA Act (“Bah Defendants”)
and another group (“Greater Praise Defendants”) (all defendants collectively,
“Defendants”) intervened in defense of the ESA Act. Defendants filed motions to dismiss,
which the Trial Court granted on grounds that Plaintiffs lack standing and their claims are
not ripe for judicial review. In reaching its decision, the Trial Court found that the ESA
Act has not caused the affected counties any unequal hardship. Plaintiffs appeal the
dismissal of their first, second, and sixth causes of action only. We conclude that the Trial
Court erred by deciding factual disputes over the impact of the ESA Act on Plaintiffs at the
motion to dismiss stage. Plaintiffs alleged enough in their amended complaint to establish
standing both as parents and taxpayers. Plaintiffs’ claims also are ripe for judicial review.
We, therefore, reverse the judgment of the Trial Court as to Plaintiffs’ first, second, and
sixth causes of action and remand for further proceedings consistent with this Opinion.

    Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Reversed;
                                     Case Remanded

1
  Pursuant to Tenn. Code Ann. § 20-18-101, the Tennessee Supreme Court appointed a three-judge panel
to preside over this case, which involves constitutional challenges. The Trial Court panel was composed
of Chancellor Anne C. Martin, Judge Tammy M. Harrington, and Judge Valerie L. Smith. Chancellor
Martin served as chief judge of the panel.
D. MICHAEL SWINEY, C.J., delivered the opinion of the court, in which CARMA DENNIS
MCGEE and JEFFREY USMAN, JJ., joined.

Christopher M. Wood, Nashville, Tennessee; Sophia Mire Hill, Jackson, Mississippi;
Stella Yarbrough, Nashville, Tennessee; and Wendy Lecker and Jessica Levin, Newark,
New Jersey, for the appellants, Roxanne McEwen, David P. Bichell, Terry Jo Bichell, Lisa
Mingrone, Claudia Russell, Inez Williams, Heather Kenney, Elise McIntosh, and Apryle
Young.

Justin Owen, Nashville, Tennessee; Arif Panju, Austin, Texas; and David Hodges and
Keith Neely, Arlington, Virginia, for the appellees, Natu Bah, Builguissa Diallo, and Star
Brumfield.

Jonathan Skrmetti, Attorney General and Reporter; Andrée Sophia Blumstein, Solicitor
General; Stephanie Bergmeyer, Senior Assistant Attorney General; Jim Newsom; E.
Ashley Carter; Matt R. Dowty; Robert W. Wilson; and Shanell Tyler, Assistant Attorneys
General, for the appellees, Governor Bill Lee, the Tennessee Department of Education, the
Tennessee State Board of Education, and Penny Schwinn, Education Commissioner.

M.E. Buck Dougherty, III, Chicago, Illinois, for the appellees, Greater Praise Christian
Academy, Sensational Enlightenment Academy Independent School, Ciera Calhoun,
Alexandria Medlin, and David Wilson, Sr.

                                       OPINION

                                      Background

        This case was disposed of at the motion to dismiss stage on grounds of standing and
ripeness. As the Tennessee Supreme Court has explained, “[o]n a motion to dismiss, the
Court presumes all factual allegations to be true and construes them in favor of the
plaintiff.” Metro. Gov’t of Nashville & Davidson Cnty. v. Tenn. Dep’t of Educ., 645
S.W.3d 141, 147-48 (Tenn. 2022). This presumption of truth “is equally true with respect
to factual allegations regarding standing.” Id. at 148. A trial court’s legal conclusions
regarding the adequacy of a complaint are reviewed de novo. Webb v. Nashville Area
Habitat for Humanity, Inc., 346 S.W.3d 422, 426 (Tenn. 2011). Thus, we review Plaintiffs’
operative amended complaint filed in August 2022 to determine whether Plaintiffs alleged
enough to establish standing as taxpayers and/or parents and whether their claims are ripe
for judicial review. At this motion to dismiss stage, we must accept Plaintiffs’ factual
allegations as true and construe them in Plaintiffs’ favor.
                                            -2-
       Plaintiffs sued State Defendants in the Trial Court challenging the ESA Act.2 At
this motion to dismiss stage, Plaintiffs’ factual allegations are the universe of facts we can
consider. Given the standard of review, we deem it appropriate to quote substantially from
Plaintiffs’ amended complaint. In their amended complaint, Plaintiffs alleged in
substantial part:

                50. During the 2019 session, the Tennessee Legislature enacted the
        Voucher Law, T.C.A. § 49-6-2601, et seq. On May 24, 2019, Governor Lee
        signed the bill into law.
               51. As discussed below, the Voucher Law establishes a voucher
        program exclusively in Davidson and Shelby Counties.
               52. The Voucher Law diverts taxpayer funds that were appropriated
        to maintain and support public schools in Shelby County Schools and Metro
        Nashville Public Schools to private schools and other private education
        expenses. Under the Voucher Law, BEP [Basic Education Program] funds
        (in 2022-2023) and TISA [Tennessee Invest in Student Achievement Act]
        funds (in 2023-2024 and thereafter) otherwise payable to Shelby County
        Schools and Metro Nashville Public Schools are to be deposited into an
        “Education Savings Account” (“ESA”) for each participating voucher
        student.
               53. The General Assembly did not make an appropriation for the
        estimated first year’s funding of the Voucher Law during the session in
        which it was enacted.
               54. Despite the absence of an appropriation for the estimated funding
        of the Voucher Law in fiscal year 2019, Defendant TDOE entered into a $2.5
        million contract in November 2019 with ClassWallet, a private, for-profit
        company based in Florida. Under this contract, ClassWallet was to oversee
        online application and payment systems for the voucher program.
        ClassWallet began work under this contract in November 2019.
               55. Defendant TDOE paid ClassWallet approximately $1.2 million in
        2019 for performance under this contract, despite the fact that no money was
        appropriated for the first year of the Voucher Law. According to testimony
        by the TDOE’s deputy commissioner before the General Assembly’s Joint
        Government Operations Committee on January 27, 2020, the TDOE diverted
        funds appropriated by the General Assembly for the unrelated “Career

2
  The Metropolitan Government of Nashville and Davidson County and the Shelby County Government,
or County Plaintiffs, also filed suit to challenge the ESA Act. However, this Court entered an order upon
the stipulation of the parties pursuant to Tenn. R. App. P. 15(a) dismissing the Metropolitan Government
of Nashville and Davidson County and the Shelby County Government from this appeal.
                                                  -3-
        Ladder” program for public school teachers to pay ClassWallet for services
        performed to implement the Voucher Law.

                B. The Voucher Law Targets Shelby and Davidson Counties

               56. The Voucher Law applies to public schools and students in only
        two Tennessee counties: Shelby and Davidson.
               57. The eligibility criteria for participation in the ESA voucher
        program requires that a student:
               (i) Is zoned to attend a school in an LEA [local education agency],
               excluding the achievement school district (ASD), with ten (10) or
               more schools:
                       (a) Identified as priority schools in 2015, as defined by the
                       state’s accountability system pursuant to § 49-1-602;
                       (b) Among the bottom ten percent (10%) of schools, as
                       identified by the department in 2017 in accordance with § 49-
                       1-602(b)(3); and
                       (c) Identified as priority schools in 2018, as defined by the
                       state’s accountability system pursuant to § 49-1-602; or
                       (ii) Is zoned to attend a school that is in the ASD on May 24,
                       2019.
        T.C.A. § 49-6-2602(3)(C).[3]
               58. In the entire State of Tennessee, the only LEAs that meet the
        specific criteria in subsection (i) above are Shelby County Schools and Metro
        Nashville Public Schools.
               59. As of the date specified in subsection (ii) — May 24, 2019 — all
        of the public schools in the ASD were located in Shelby and Davidson
        Counties.

                                                    ***

               61. The history of the Voucher Law makes clear that the General
        Assembly intended the Law to apply only to Shelby and Davidson Counties.
        When the bill was first introduced, it applied to five counties — Shelby,
        Davidson, Hamilton, Madison, and Knox — but three were removed to
        secure the votes needed for passage by the General Assembly.
               62. There are numerous references in the legislative record
        demonstrating the General Assembly’s intent to limit the Voucher Law to
3
  This section was amended in part by 2023 Pub.Acts, c. 328, § 1, eff. May 5, 2023, to include in the
eligibility criteria: “Identified as priority schools in 2021, as defined by the state’s accountability system
pursuant to § 49-1-602[.]” Tenn. Code Ann. § 49-6-2602(3)(C)(i)(d).
                                                     -4-
Shelby County Schools and Metro Nashville Public Schools. For example,
on April 25, 2019, Senator Joey Hensley explicitly stated during debate on
the Senate Floor that the Voucher Law would cover only Davidson and
Shelby County schools.
       63. When the votes on the Voucher Law were cast and there was a 49-
49 tie, then-Speaker Glen Casada held the vote open for over 38 minutes.
During that time, he engaged in a lengthy discussion with Knoxville
Representative Jason Zachary, who opposed the bill, on a balcony behind the
House building. After that discussion, Knox County was no longer subject
to the Voucher Law, Representative Zachary switched his vote, and the bill
passed.

                                      ***

        69. For every student who attends Shelby County Schools and Metro
Nashville Public Schools, the State provides just the state share of the BEP.
The local share comes from the county — from local revenue sources. When
a student leaves the district without using a voucher, e.g., if that student
moves out of district or attends a private school without a voucher, the district
only loses the state share. When a student leaves Shelby County Schools or
Metro Nashville Public Schools to use a voucher, the districts lose — out of
their state allocation — an amount representing the state and local shares.
        70. TDOE estimates that for the current school year, the voucher
amount will be $8,192 per pupil. TDOE, Education Savings Account
Program, How the ESA Program Works 2022, available at
https://esa.tnedu.gov/ (“Each ESA is funded at approximately $8,192 to pay
for private school tuition or other approved educational expenses.”). So for
each voucher student, Shelby County Schools or Metro Nashville Public
Schools will lose this amount in state finding.
        71. For example, for the 2022-23 school year, Metro Nashville Public
Schools’ total state share of the BEP is $297,722,000. The relevant student
count to determine the per-pupil state share is 78,521. So, the per-pupil state
contribution is $3,791.62. The total local share of the BEP is $421,825,000,
or $5,372.13 per-pupil. Thus, when a student leaves Metro Nashville Public
Schools for a reason other than taking a voucher, Metro Nashville Public
Schools would lose $3,791.62 in state funds. When a student leaves to use a
private school voucher, the County/District will lose more than twice that
amount of state funding, or $8,192.
        72. For the 2022-2023 school year, Shelby County Schools’ total state
share of the BEP is $651,789,000. The relevant student count to determine
the per-pupil state share is 109,835. So, the per-pupil state contribution is
                                       -5-
$5,934.26. The total local share of the BEP is $283,036,000, or $2,576.92
per pupil. Thus, when a student leaves Shelby County Schools for a reason
other than taking a voucher, Shelby County Schools would lose $5,934.26 in
state funds. When a student leaves to use a private school vouchers, the
County/District will lose significantly more than that amount of state
funding, or $8,192.
        73. In enacting TISA in 2022, the Legislature amended the Voucher
Law to replace any reference to the BEP with TISA. 2022 Tenn. Laws Pub.
Ch. 966 (H.B. 2143), §§ 53-56. This includes amending the voucher funding
calculation and funding source to replace BEP with TISA. Id., §§ 54-55.
        74. The TISA amount for each district represents both a state share,
coming from state funds, and a local share, from local revenue sources.
T.C.A. § 49-3-109. Starting in the 2023-2024 school year, the voucher
amount subtracted from each targeted LEA will be the state and local shares
— up to the combined statewide average — of the State and local per-pupil
TISA allocation.
        75. Thus, under TISA, the voucher funding mechanism will operate
the same way it does under the BEP. Pursuant to the Voucher Law, the
districts will still lose an amount representing both the state and local shares
of public education funding for each student who leaves the district to use a
voucher.
        76. The Voucher Law, under both the BEP and TISA, requires LEAs
to continue to count students who leave the district to use a voucher as
enrolled in the district. T.C.A. § 49-6-2605(b)(1). Thus, the LEAs must raise
local funds from taxpayers as if those students were still in the district.
Requiring that the districts count students as enrolled increases the amount
of local money the districts must raise from local tax dollars in order to satisfy
state “maintenance of effort” requirements.
        77. The Voucher Law allows up to 5,000 vouchers during the first
school year that the program is implemented. T.C.A. § 49-6-2604(c). In
each subsequent school year, the law allows an increase of 2,500 vouchers.
Id. In the fifth year and thereafter, the law allows up to 15,000 vouchers. Id.
        78. In year one, tens of millions in BEP funds will be diverted from
Shelby County Schools and Metro Nashville Public Schools if 5,000 students
use a voucher. By year five, hundreds of millions in BEP/TISA funds could
be diverted from Shelby County Schools and Metro Nashville Public
Schools.

                                      ***

                                       -6-
        82. The hundreds of millions of dollars that will be diverted from
Shelby County Schools and Metro Nashville Public Schools under the
Voucher Law will drastically exacerbate the current underfunding of Shelby
County Schools and Metro Nashville Public Schools. The Voucher Law will
require Shelby County Schools and Metro Nashville Public Schools to make
further reductions in teachers, support staff, technology, and other resources
essential to providing a constitutionally adequate education to their students.
        83. The Voucher Law authorizes grants for Shelby County Schools
and Metro Nashville Public Schools from a “school improvement fund” for
up to three years. T.C.A. § 49-6-2605(b)(2). These grants are expressly
subject to an appropriation of funds by the General Assembly each year. Id.
        84. The Voucher Law restricts the use of these grants, if appropriated,
to “school improvement” only. Thus, these grants, even if available, cannot
be used for general operating funds and consequently will not replace the
state and local BEP funds diverted from Shelby County Schools and Metro
Nashville Public Schools under the Voucher Law.
        85. Even if the General Assembly fully funds these “school
improvement grants,” the grants will not compensate Shelby County Schools
and Metro Nashville Public Schools for the loss of BEP funds for each
student who uses a voucher. The grants equal only the amount of money
diverted to ESA voucher accounts for students who “[w]ere enrolled in and
attended a school in the LEA for the one (1) full school year immediately
preceding the school year in which the student began participating in the
program.” T.C.A. § 49-6-2605(b)(2)(A)(i). This does not include students
who are “eligible for the first time to enroll in a Tennessee school” — for
example, those entering kindergarten — who are also eligible for the voucher
program. T.C.A. § 49-6-2602(3)(A)(ii).
        86. In addition to the initial loss of BEP/TISA funds by Shelby County
Schools and Metro Nashville Public Schools, the Voucher Law provides that,
when an ESA account is closed for any number of reasons, the remaining
funds are returned to the State’s BEP/TISA account rather than returned to
Shelby County Schools or Metro Nashville Public Schools. T.C.A. §§ 49-6-
2603(e), 49-6-2608(e). Even when a voucher student returns to Shelby
County Schools or Metro Nashville Public Schools and the district resumes
full responsibility for educating that student, the funds remaining in the
student’s ESA account are returned to the State and not to the district. T.C.A.
§ 49-6-2603(e).
        87. Furthermore, a student’s departure from Shelby County Schools
or Metro Nashville Public Schools to use a voucher does not relieve the
districts of all of the costs associated with that student.

                                      -7-
              88. Shelby County Schools and Metro Nashville Public Schools bear
       substantial fixed costs in operating their public schools. These fixed costs
       include facilities repair and maintenance, teacher and staff pensions, debt
       service, and long-term contracts. Because participants in the voucher
       program will exit Shelby County Schools and Metro Nashville Public
       Schools from different schools, grade levels, and classrooms, the districts
       will be unable to proportionately reduce these fixed costs. Moreover,
       because students will leave the districts from different classrooms, grades,
       and schools, the districts will likewise not be able to proportionately reduce
       variable costs, such as staff, programs, and services. Thus, the districts will
       be unable to rely on reduced costs to cover the loss of BEP or TISA funds
       under the Voucher Law.
              89. As set forth below, the Voucher Law permits private schools
       participating in the voucher program to deny enrollment to students with
       elevated needs, including students with disabilities, who may be more
       expensive to educate. As a result, the Voucher Law will likely increase the
       concentration of more costly-to-educate students in Shelby County Schools
       and Metro Nashville Public Schools, with less money available for their
       support and growth.

Based on these factual allegations, Plaintiffs alleged six causes of action. Plaintiffs have
appealed the dismissal of only their first, second, and sixth causes of action, which read as
follows:

                             FIRST CAUSE OF ACTION
              (Violation of the Education and Equal Protection Clauses
                             of the Tennessee Constitution)

               112. Plaintiffs incorporate all allegations in all preceding paragraphs
       as if fully set forth herein.
               113. Under the Tennessee Constitution, the State of Tennessee,
       through the General Assembly, must maintain and support a system of public
       schools that provides adequate and substantially equal educational
       opportunities to all children residing in the State. TENN. CONST., art. I, §
       8; art. XI, §§ 8, 12; Small Sch. Sys. I, 851 S.W.2d at 139; Small Sch. Sys. II,
       894 S.W.2d at 734; Tenn. Small Sch. Sys. v. McWherter (“Small Sch. Sys.
       III”), 91 S.W.3d 232 (Tenn. 2002).
               114. In the Small School Systems rulings, the Tennessee Supreme
       Court invalidated the State’s previous school funding system because it
       deprived public school students in certain LEAs of substantially equal
       educational opportunities. Small School Systems I, 851 S.W.2d at 156. The
                                             -8-
Supreme Court also declared that the General Assembly’s enactment of the
BEP statute and funding formula was intended to cure those constitutional
deficiencies. Small Sch. Sys. II, 894 S.W.2d at 736.
       115. The Voucher Law will deprive students in Shelby County
Schools and Metro Nashville Public Schools of substantially equal
educational opportunities by diverting the BEP/TISA funds appropriated by
the General Assembly to maintain and support their schools to pay for private
school tuition and other private educational expenses.
       116. Currently through the BEP statute, and after 2022-2023 through
the TISA statute, the General Assembly provides funding to maintain and
support an adequate education for students in the State’s system of public
schools. Because the Voucher Law diverts substantial BEP/TISA funds
intended to maintain and support Shelby County Schools and Metro
Nashville Public Schools away from those districts, the Law deprives
students in Shelby County Schools and Metro Nashville Public Schools of
the BEP/TISA funds deemed legally necessary to provide them with an
adequate and equal education.
       117. The current funding provided by the General Assembly through
the BEP statute is demonstrably inadequate to enable Shelby County Schools
and Metro Nashville Public Schools to provide the teachers, support staff,
and other resources necessary to afford all students an adequate education
under Article I, § 8, and Article XI, §§ 8 and 12, of the Tennessee
Constitution. The diversion of BEP funds under the Voucher Law will
further deprive Shelby County Schools and Metro Nashville Public Schools
of the funding required to provide their students with a constitutionally-
mandated adequate and equal education.
       118. Because the Voucher Law alters and diminishes the BEP/TISA
funds appropriated by the General Assembly to maintain and support Shelby
County Schools and Metro Nashville Public Schools, the Law violates the
Equal Protection and Education Clauses of the Tennessee Constitution,
Article I, § 8; Article XI, §§ 8, 12, for students in Shelby County Schools and
Metro Nashville Public Schools.

                     SECOND CAUSE OF ACTION

  (Violation of the Requirement of a Single System of Public Schools
  Mandated by the Education Clause of the Tennessee Constitution)

        119. Plaintiffs incorporate all allegations in all preceding paragraphs
as if fully set forth herein.

                                      -9-
        120. The Tennessee Constitution’s Education Clause, Article XI, §
12, requires the General Assembly to provide for the maintenance, support
and eligibility standards of “a system of free public schools” (emphasis
added). The Tennessee Constitution does not permit the General Assembly
to maintain and support schools outside the system of free public schools.
        121. The Voucher Law diverts BEP funds appropriated by the General
Assembly to maintain and support Tennessee public schools to instead pay
for tuition and other expenses in private schools that do not comply with the
requirements of a single system of public schools.
        122. The private schools authorized by the Voucher Law to participate
in the voucher program are not — and cannot, by the express terms of the
Law — be part of the State of Tennessee’s system of free public schools.
        123. Under the Voucher Law, participating private schools are not
required to comply with the same academic and eligibility standards required
by State law for Tennessee’s system of free public schools.
        124. Under the Voucher Law, participating private schools are
expressly exempt from the legal obligation to enroll and educate all students,
as is required in Tennessee’s system of free public schools. The participating
private schools can deny enrollment or otherwise discriminate against
students based on characteristics such as disability, religion, English
proficiency, LGBTQ status, and ability to pay tuition or fees.
        125. Under the Voucher Law, participating private schools are not
required to provide services that public schools are obligated under state and
federal law to provide to students, including special education services for
students with disabilities.
        126. Under the Voucher Law, participating private schools are not
subject to the requirements imposed by State law on public schools to protect
students from harassment, intimidation, or bullying.
        127. Under the Voucher Law, participating private schools are not
required to comply with the same governance and accountability mandates
of state law that apply to Tennessee’s system of free public schools.
        128. The Voucher Law violates the General Assembly’s obligation in
Article XI, § 12 of the Tennessee Constitution to maintain and support “a
system” of “free public schools” (emphases added).

                                     ***

                      SIXTH CAUSE OF ACTION
      (Violation of the Appropriation of Public Moneys Provisions
          of the Tennessee Constitution and T.C.A. § 9-4-601)

                                     -10-
               146. Plaintiffs incorporate all allegations in all preceding paragraphs
       as if fully set forth herein.
               147. Article II, § 24, of the Tennessee Constitution provides:
                       Any law requiring the expenditure of state funds shall
               be null and void unless, during the session in which the act
               receives final passage, an appropriation is made for the
               estimated first year’s funding.
               148. Article II, § 24, of the Tennessee Constitution also provides: “No
       public money shall be expended except pursuant to appropriations made by
       law.[”]
               149. By statute, “[n]o money shall be drawn from the state treasury
       except in accordance with appropriations duly authorized by law.” T.C.A. §
       9-4-601(a)(1).
               150. The Voucher Law was enacted by the General Assembly in its
       2019 legislative session.
               151. During the 2019 legislative session, the General Assembly did
       not make an appropriation for the estimated first year’s funding of the
       Voucher Law.
               152. In November 2019, Defendant TDOE signed a $2.5 million
       contract with a private for-profit company, ClassWallet, to undertake the
       administration of the Voucher Law. ClassWallet began work under the
       contract in November 2019.
               153. TDOE diverted public funds from an unrelated, existing State
       program supporting public school teachers to instead pay ClassWallet $1.2
       million in 2019 for its work on the voucher program.
               154. TDOE’s expenditures for the ClassWallet contract, or any other
       expenditures for the administration and implementation of the Voucher Law
       in 2019, without appropriation for the estimated first year’s funding of the
       Voucher Law, render the Voucher Law null and void under Article II, § 24
       of the Tennessee Constitution and violate T.C.A. § 9-4-601.
               155. Moreover, TDOE’s plan to spend public money to reimburse
       private schools directly also violates the Appropriations of Public Money
       provisions. There is no law authorizing this expenditure of public money.

       Defendants filed motions to dismiss and for judgment on the pleadings. In
November 2022, the Trial Court ruled 2-1 in favor of Defendants on grounds that Plaintiffs
lack standing and that their claims are not ripe. The Trial Court expressly declined to rule
on any other grounds. The Trial Court majority concluded, as relevant:

              The parties in this matter appeared through counsel on September 19,
       2022, before this Court—presided over by a Three-Judge Panel appointed by
                                            -11-
the Tennessee Supreme Court pursuant to Tenn. Code Ann. § 20-18-101 and
Tenn. Sup. Ct. Interim R. 54—to argue six motions made under Rule 12 of
the Tennessee Rules of Civil Procedure. These motions consist of four
motions to dismiss and two motions for judgment on the pleadings brought
by the defendants and intervenor-defendants in this matter. The Court took
the motions under advisement and is now ready to rule.
       For the reasons that follow, we hold the plaintiffs in this case lack
standing to pursue their claims. In the alternative, we hold those claims lack
ripeness. Therefore, the motions of the defendants and intervenors are
GRANTED with respect to those issues and DENIED as moot as to all other
issues. The Amended Complaints are DISMISSED.

                                      ***

B. Standing of McEwen Plaintiffs

                             I . Taxpayer Standing

        Generally, “private citizens . . ., cannot maintain an action
complaining of the wrongful acts of public officials unless such private
citizens aver special interest or a special injury not common to the public
generally.” Fannon v. City of LaFollette, 329 S.W.3d 418, 427 (Tenn. 2010)
(quoting Bennett v. Stutts, 521 S.W.2d 575, 576 (Tenn. 1975)). An exception
exists, however, when the taxpayer has (1) alleged a “specific illegality in
the expenditure of public funds,” and (2) made a “prior demand on the
governmental entity asking it to correct the alleged illegality.” Id. (quoting
Cobb v. Shelby Cnty. Bd. of Comm’rs, 771 S.W.[2]d 124, 126 (Tenn. 1989)).
Our Supreme Court has elaborated further:

       As this Court explained in Cobb, the taxpayer’s complaint
       “must allege a specific legal prohibition on the disputed use of
       funds or demonstrate that it is outside the grant of authority to
       the local government.” In establishing that a prior demand has
       been made, a plaintiff is required to “first have notified
       appropriate officials of the illegality and given them an
       opportunity to take corrective action short of litigation.” A
       prior demand “is excused [only] where the status and relation
       of the involved officials to the transaction in question is such
       that any demand would be a formality.”

Id. at 427-28 (citations omitted) (alteration in original).
                                      -12-
        State Defendants and Intervenor-Defendants argue first that taxpayer
status must fail because no prior demand has been made in this case.
McEwen Plaintiffs argue that such a demand would have been futile because
of State Defendants[’] direct involvement in the negotiations for and
ultimately enactment of the ESA Act, and thus a mere formality satisfying
the exception to the requirement.
        The Court is disinclined to exempt Plaintiffs from the prior demand
in this case. McEwen Plaintiffs point to the reasoning of the Court of Appeals
in Ragsdale v. City of Memphis, 70 S.W.3d 56, 63 (Tenn. Ct. App. 2001): “In
the instant ease, the executives of both City and County have actively
participated in the negotiations involving the NBA franchise, have signed
required legislation, and have ultimately signed the required contractual
documents. Under these circumstances, a prior demand would be a mere
formality and should be excused.” Here, McEwen Plaintiffs maintain their
allegations regarding Governor Lee (campaigned on and signed the ESA
Act), Education Commissioner Schwinn (moved to quickly implement the
Act), Members of the State Board of Education (adopted the administrative
rules implementing the Act), and former House Speaker Glen Casada
(holding open the vote on the Act to negotiate its final passage) demonstrate
similar active participation. But extending the rationale of Ragsdale to this
scenario would swallow the prior-demand requirement entirely. Governors
regularly campaign on future legislation and in most cases sign legislation
before it becomes law. Agencies and their officials regularly implement new
legislation. A house speaker regularly shepherds bills across the finish line.
By applying the exception here, this Court would render it no exception at
all.
        Furthermore, State Defendants and Intervenor-Defendants also argue
that McEwen Plaintiffs only made an allegation of “specific illegality” with
respect to Count VI, their appropriations claim. McEwen Plaintiffs respond
that all of their claims allege that the expenditure of funds under the ESA is
illegal based on the respective constitutional provision or state statute that
gives rise to their claim. State Defendants counter that the requirement of an
allegation of specific illegality means something more—“a specific legal
prohibition on the disputed use of funds or demonstrat[ion] that it is outside
the grant of authority to the local government.” Fannon, 329 S.W.3d at 427
(citing Cobb, 771 S.W.2d at 126). The Court must agree with State
Defendants lest this exception also grow so broad as to swallow the rule.
Under McEwen Plaintiffs[’] rationale, any government act that uses funds
from the state treasury would create taxpayer standing if the taxpayer could
formulate a claim of unconstitutionality or other statutory violation. This
would undermine the entire basis for the doctrine of taxpayer standing. See
                                     -13-
id. at 427 (quoting Badgett v. Rogers, 436 S.W.2d 292, 293-94 ) (“[T]he
courts have long recognized the necessity of allowing municipal officials to
perform their duties without interference from frequent and possibly
frivolous litigation and the inexpedience of putting municipal officers at
hazard to defend their acts whenever any member of the community sees fit
to make the assault, whether for honorable motives or not.”). Of McEwen
Plaintiffs’ claims, the appropriations claim alone alleges an illegality in the
expenditure itself rather than unconstitutionality or unlawful implementation
of the ESA Act. But, as already discussed, the appropriations claim still lacks
the requirement for a prior demand.
        Accordingly, the Court finds that McEwen Plaintiffs have failed to
establish taxpayer standing for their claims. With respect to taxpayer
standing, the motions of State Defendants are GRANTED. As far as the
Court can discern, Plaintiff Russell, who does not claim she has a child
affected by the ESA, only seeks standing as a taxpayer. Therefore, she is
DISMISSED as a party to this action.

                            2. Standing as Parents

       State Defendants and Intervenor-Defendants next argue the remaining
McEwen Plaintiffs, Parent Plaintiffs, lack standing as parents because they
cannot show that their children have been or will be harmed by the ESA
Program. Parent Plaintiffs respond that this contention is incorrect and
ultimately unpersuasive because they can demonstrate the harm caused.

              i. Education Clause Violation (Equal Protection)

        Parent Plaintiffs’ first cause of action is an alleged violation of the
requirement articulated in Small Schools I, 851 S.W.2d at 151, at the
conjunction of the Education Clause and the Tennessee Constitution’s Equal
Protection provisions that Parent Plaintiffs’ children are entitled to the
opportunity for a free, public education that is adequate and substantially
equal as the opportunities afforded to all other Tennessee schoolchildren.
Parent Plaintiffs have argued that the ESA Act diverts funds from the school
districts in their counties alone and that the remaining funding is inadequate.
As already discussed in the context of County Plaintiffs, however, this
alleged injury is merely speculative while the school improvement fund is in
effect. If there is no loss of funds, there is no disparate treatment—and
therefore, no injury. The Court holds Parent Plaintiffs lack standing for this
claim.

                                     -14-
     ii. Education Clause Violation (public funding of private schools)

       The second cause of action alleges the ESA Act violates the Education
Clause by diverting funds from the schools of Parent Plaintiffs’ children to
fund private education, something Parent Plaintiffs argue is unconstitutional.
As with Count I, the alleged injury has not occurred because the diverted
funds have been replaced. Absent the necessary injury to challenge the ESA
Act on this basis, Parent Plaintiffs lack standing for this cause of action as
well.

                                      ***

                     vi. Appropriations Clause Violation

       The sixth cause of action alleges that the Tennessee Department of
Education contracted in 2019 with a private company to administer the ESA
Program without an appropriation as required by Article II, Section 24 of the
Tennessee Constitution. This expenditure without an appropriation again has
no causal connection to the alleged harm—diversion of funds from their
children’s schools to the detriment of their children’s education. Thus, the
Court must again find that Parent Plaintiffs lack standing to bring Count VI.

II. Ripeness

       Alternatively, we hold that Plaintiffs’ claims lack ripeness. Ripeness
is another justiciability doctrine, inquiring “whether the harm asserted has
matured sufficiently to warrant judicial intervention.” Warth v. Seldin, 422
U.S. 490, 499 n.10 (1975) (quoted favorably in Darnell, 195 S.W.3d at 620
n.7). The Tennessee Supreme Court has explained that a claim lacks ripeness
when it “involves uncertain or contingent future events that may or may not
occur as anticipated or, indeed, may not occur at all.” B&B Enterprs. of
Wilson Cnty., LLC v. City of Lebanon, 318 S.W.3d 839, 848 (Tenn. 2010)
(citing Lewis v. Cont’l Bank Corp., 494 U.S. 472, 479-80 (1990)). The
Court’s determination of ripeness involves two questions: first, whether the
claim is “appropriate for judicial resolution”; and second, whether the
Court’s “refusal to act” would prejudice the claimants’ ability to seek redress
of their grievances. Id. In other words, has the claimants’ alleged injury
occurred or might it occur in the future? See State v. Price, 579 S.W.3d 332,
338 (Tenn. 2019) (quoting West v. Schofield, 468 S.W.3d 482, 491 (Tenn.
2015)) (“An issue is not fit for judicial decision if it is based ‘on hypothetical
and contingent future events that may never occur.’ Rather, the issue must
                                      -15-
be ‘based on an existing legal controversy.’”). And if the injury has not yet
occurred, will the claimants be able to seek relief when it does occur? See
id. (quoting West, 468 S.W.3d at 492) (“The second prong of the ripeness
analysis takes into account ‘whether withholding adjudication . . . will
impose any meaningful hardship on the parties.’”); B&B Enterprs. of Wilson
Cnty., LLC, 318 S.W.3d at 849 (quoting AmSouth Erectors, LLC v. Skagg
Iron Works, Inc., W2002-01944-COA-R3-CV, 2003 WL 21878540, at *6
(Tenn. Ct. App. Aug. 5, 2003)) (“The court will decline to act ‘where there
is no need for the court to act or where the refusal to act will not prevent the
parties from raising the issue at a more appropriate time.’”).
        State Defendants argue Plaintiffs’ equal protection and education
clause claims are unripe because they rely on the allegation of an inequitable
distribution of funds—thereby treating Shelby and Davidson Counties and
their schools unequally as well as depriving the students in those schools of
an adequate education—when those funds have not yet been distributed.
Moreover, argue State Defendants, citing Tenn. Code Ann. §§ 49-6-
2603(a)(1)-(3) and -2605(b)(2)(A), the Davidson and Shelby LEAs will keep
some state funds to educate ESA students without the actual obligation to
educate those students. State Defendants further point to Tenn. Code Ann. §
49-6-2605(b)(2)(A)’s establishment of a school improvement fund from
which the Department of Education “shall disburse an annual grant to each
LEA to be used for school improvement in an amount equal to the ESA
amount for participating students under the program.” Thus, argue State
Defendants, these LEAs can expect to receive more money per student than
they would in the absence of the ESA. Still further, State Defendants argue
the alleged harm, if it ever occurs, is to the LEAs not the Plaintiff Counties
or the children of the Plaintiff Parents.
        Plaintiff Counties respond that State Defendants are implementing the
ESA Program right now, citing Governor Lee’s statement on social media
that the program was actively accepting applicants, meaning Plaintiffs’
claims raise a live controversy, not some hypothetical, future event. Plaintiff
Counties frame the injury here not merely as the additional financial burden
placed upon them but the loss of discretion over their own funding choices
as the result of a single ESA award. With respect to the Education Clause,
Parent Plaintiffs argue that their children attend schools that already had
unconstitutionally inadequate funding and now are being further deprived.
They further argue that withholding judgment on the ESA Act would impose
a meaningful hardship by further depriving their children’s schools of
funding.
        Here, the actual difference in funding caused by the ESA Act will not
occur, if ever, until after three fiscal years because the Act establishes a
                                     -16-
      school improvement fund that will award the affected schools “an amount
      equal to the ESA amount for participating students under the program.”
      Tenn. Code Ann. § 49-6-2605(b)(2)(A). Plaintiffs nevertheless allege a
      shortfall will exist between the amount diverted and the amount awarded
      because of the sub-provisions requiring the student to have actually been
      calculated into the BEP and ESA formulae. See Tenn. Code Ann. § 49-6-
      2605(b)(2)(A)(i)-(ii); McEwen Pls.’ Am. Compl., ¶¶ 82-89, No. 20-0143-II
      & No. 20-0242-II, Aug. 3. 2020, Am. Compl. for Decl. & lnj. Relief, ¶¶ 156-
      67, No. 20-0143-II & No. 20-0242-II, Aug. 3, 2020. This is not enough, and
      Plaintiffs’ argument continues to rely on speculation. No differential
      treatment between Plaintiffs’ schools and the others of this state or other
      financial injury can exist under the ESA Act until a funding gap occurs.
      Similarly, no divestment of the schools of Parent Plaintiffs’ children can
      occur before the alleged funding gap occurs. Before such time, this
      controversy is merely a disagreement of public policy and inappropriate for
      judicial decision.
              The question remains whether Plaintiffs are prejudiced by dismissal
      of their claims. We find their arguments in the affirmative unpersuasive.
      Should the alleged injury occur in the future, Plaintiffs would have the
      recourse of pursuing appropriate litigation. Permitting State Defendants to
      implement a policy Plaintiffs disagree with will not jeopardize their rights.
              Accordingly, the Court holds in the alternative that Plaintiffs’ claims
      lack ripeness and should be DISMISSED.

                                       Conclusion

             Finding no distinct and palpable injury to Plaintiffs in light of the ESA
      Act’s replacement of diverted funds, we hold Plaintiffs lack standing to
      challenge the Act. In several instances, Plaintiffs’ claims had no bearing on
      the alleged injury to begin with, lacking a necessary causal connection
      between the nature of the cause of action and the alleged injury. The Court
      alternatively holds that Plaintiffs’ claims are not yet ripe because the ESA
      replaces the diverted funding for at least three years. Therefore, State
      Defendants’ and Greater Praise Intervenor-Defendants’ motions are
      GRANTED on these articulated bases. Parent-Intervenors’ motions for
      judgment on the pleadings are not reached by the Court and therefore
      DENIED as moot. The Amended Complaints are DISMISSED.

             Any other relief requested is hereby DENIED.

(Footnotes omitted).
                                           -17-
       Chancellor Martin wrote a concurring and dissenting opinion in which she stated,
in part: “[Plaintiffs] have alleged the ESA Act deprives their children’s schools of funds
unlike the schools of children in other counties, and they have alleged that the stopgap
provision is inadequate to cover those losses. . . . [T]he Court ought to accept these
allegations and move forward in its analysis because the allegations are sufficient for
standing.” Chancellor Martin stated further that, in her judgment, Plaintiffs’ claims were
ripe for judicial review. Chancellor Martin would have permitted Plaintiffs’ education
clause claims, as well as their BEP/TISA claim, to move forward. Plaintiffs timely
appealed to this Court.

                                                 Discussion

       Although not stated exactly as such, Plaintiffs raise the following issues on appeal:
1) whether the Trial Court erred in ruling that Plaintiffs lacked standing to challenge the
constitutionality of the ESA Act under the Education and Equal Protection Clauses of the
Tennessee Constitution; 2) whether the Trial Court erred in ruling that Plaintiffs lacked
standing to challenge the constitutionality of the ESA Act for violating the requirement of
a single system of public schools mandated by the Education Clause of the Tennessee
Constitution; 3) whether the Trial Court erred in ruling that Plaintiffs lacked standing to
challenge the ESA Act for violating the Appropriation of Public Moneys provisions of the
Tennessee Constitution and Tenn. Code Ann. § 9-4-601; and 4) whether the Trial Court
erred in ruling that Plaintiffs’ claims were not ripe.4

      The Tennessee Supreme Court has articulated the applicable standard of review as
follows:

               The trial court decided the issue of standing on the State’s motion to
        dismiss pursuant to Tennessee Rule of Civil Procedure 12.02(6). The Court
        reviews the motion to dismiss on the issue of standing de novo with no
        presumption of correctness. Effler v. Purdue Pharma, L.P., 614 S.W.3d 681,
        687 (Tenn. 2020). On a motion to dismiss, the Court presumes all factual
        allegations to be true and construes them in favor of the plaintiff. Foster v.
        Chiles, 467 S.W.3d 911, 914 (Tenn. 2015). This is equally true with respect
        to factual allegations regarding standing. See Lujan v. Defs. of Wildlife, 504
        U.S. 555, 561, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992) (For the purposes of
        a challenge to standing “[a]t the pleading stage, general factual allegations of

4
  Bah Defendants ask that we affirm the Trial Court’s ruling on the alternative grounds that Plaintiffs failed
to state a claim for relief, grounds which the Trial Court declined to address. We, too, decline to address
in the first instance whether Plaintiffs stated a claim for relief. Instead, we address only the grounds actually
ruled on by the Trial Court: standing and ripeness.
                                                      -18-
      injury resulting from the defendant’s conduct may suffice, for on a motion to
      dismiss we presum[e] that general allegations embrace those specific facts
      that are necessary to support the claim.” (second alteration in original)
      (internal quotation marks omitted)).

Metro. Gov’t, 645 S.W.3d at 147-48 (footnote omitted).

       Three of the four issues on appeal implicate whether Plaintiffs have standing. The
Tennessee Supreme Court has discussed the doctrine of standing, and how a plaintiff
establishes standing, as follows:

              The United States Constitution confines the jurisdiction of the federal
      courts to “cases” and “controversies.” U.S. Const. art. III, § 2, cl. 1.
      Although the Constitution of Tennessee does not include a similar express
      limitation on the exercise of judicial power, Norma Faye Pyles Lynch Family
      Purpose LLC v. Putnam County, 301 S.W.3d 196, 202 (Tenn. 2009) (citing
      Miller v. Miller, 149 Tenn. 463, 261 S.W. 965, 971 (1924)), Tennessee courts
      have long recognized that “the province of a court is to decide, not advise,
      and to settle rights, not to give abstract opinions,” id. at 203 (quoting State v.
      Wilson, 70 Tenn. 204, 210 (1879)). Tennessee courts therefore decide only
      “legal controversies.” Id. (quoting White v. Kelton, 144 Tenn. 327, 232 S.W.
      668, 670 (1921)). To determine whether a particular case involves a legal
      controversy, Tennessee courts utilize justiciability doctrines that “mirror the
      justiciability doctrines employed by the United States Supreme Court and the
      federal courts.” Id.; see also West v. Schofield, 468 S.W.3d 482, 489-90
      (Tenn. 2015). One of these justiciability doctrines—standing—is disputed
      in this appeal.

             To determine whether standing exists, a court must focus on the party
      bringing the lawsuit rather than on the merits of the claim. Fisher v. Hargett,
      604 S.W.3d 381, 396 (Tenn. 2020); Metro. Air Rsch. Testing Auth., Inc. v.
      Metro. Gov’t of Nashville & Davidson Cnty., 842 S.W.2d 611, 615 (Tenn.
      Ct. App. 1992); see also Ariz. State Legislature v. Ariz. Indep. Redistricting
      Comm’n, 576 U.S. 787, 799-800, 135 S.Ct. 2652, 192 L.Ed.2d 704 (2015).
      The weakness of a claim on the merits must not be confused with a lack of
      standing. Ariz. State Legislature, 576 U.S. at 800, 135 S.Ct. 2652. While
      standing “often turns on the nature and source of the claim asserted,” it “in
      no way depends on the merits” of the claim. Warth v. Seldin, 422 U.S. 490,
      500, 95 S.Ct. 2197, 45 L.Ed.2d 343 (1975); see also Fisher, 604 S.W.3d at
      396. Rather, to establish standing, three elements must be satisfied:

                                            -19-
              1) a distinct and palpable injury; that is, an injury that is not
              conjectural, hypothetical, or predicated upon an interest that a
              litigant shares in common with the general public; 2) a causal
              connection between the alleged injury and the challenged
              conduct; and 3) the injury must be capable of being redressed
              by a favorable decision of the court.

       Fisher, 604 S.W.3d at 396 (citing City of Memphis v. Hargett, 414 S.W.3d
       88, 97 (Tenn. 2013)). In this case, the crux of the controversy involves the
       first element.

               The plaintiff bears the burden of establishing these elements “ ‘by the
       same degree of evidence’ as other matters on which the plaintiff bears the
       burden of proof.” ACLU of Tenn. v. Darnell, 195 S.W.3d 612, 620 (Tenn.
       2006) (quoting Petty v. Daimler/Chrysler Corp., 91 S.W.3d 765, 767 (Tenn.
       Ct. App. 2002)). The degree of evidence depends, of course, upon the stage
       of litigation at which standing is challenged. See Petty, 91 S.W.3d at 767;
       see also Lujan, 504 U.S. at 561, 112 S.Ct. 2130 (“The party invoking federal
       jurisdiction bears the burden of establishing these elements. Since they are
       not mere pleading requirements but rather an indispensable part of the
       plaintiff’s case, each element must be supported in the same way as any other
       matter on which the plaintiff bears the burden of proof, i.e., with the manner
       and degree of evidence required at the successive stages of the litigation.”
       (citations omitted)). In this case, Defendants challenged standing through a
       motion to dismiss. Accordingly, Plaintiffs’ factual allegations are presumed
       to be true and are construed in their favor. Foster, 467 S.W.3d at 914; see
       also Lujan, 504 U.S. at 561, 112 S.Ct. 2130.

Metro. Gov’t, 645 S.W.3d at 148-49 (footnote omitted).

       The first of Plaintiffs’ issues we address is whether the Trial Court erred in ruling
that Plaintiffs lacked standing to challenge the constitutionality of the ESA Act under the
Education and Equal Protection Clauses of the Tennessee Constitution. Article I, section
8 of the Tennessee Constitution states: “That no man shall be taken or imprisoned, or
disseized of his freehold, liberties or privileges, or outlawed, or exiled, or in any manner
destroyed or deprived of his life, liberty or property, but by the judgment of his peers or
the law of the land.” In addition, Article XI, section 8 of the Tennessee Constitution
provides, as relevant:

       The Legislature shall have no power to suspend any general law for the
       benefit of any particular individual, nor to pass any law for the benefit of
                                            -20-
        individuals inconsistent with the general laws of the land; nor to pass any law
        granting to any individual or individuals, rights, privileges, immunitie[s], or
        exemptions other than such as may be, by the same law extended to any
        member of the community, who may be able to bring himself within the
        provisions of such law.

Meanwhile, Article XI, Section 12 of the Tennessee Constitution provides: “The State of
Tennessee recognizes the inherent value of education and encourages its support. The
General Assembly shall provide for the maintenance, support and eligibility standards of a
system of free public schools. The General Assembly may establish and support such
postsecondary educational institutions, including public institutions of higher learning, as
it determines.” The Tennessee Supreme Court has held that “[t]he constitution, therefore,
imposes upon the General Assembly the obligation to maintain and support a system of
free public schools that affords substantially equal educational opportunities to all students.
The means whereby this obligation is accomplished, is a legislative prerogative.” Tenn.
Small Sch. Sys. v. McWherter, 851 S.W.2d 139, 140-41 (Tenn. 1993). In Tenn. Small Sch.
Sys., the Tennessee Supreme Court concluded that “[t]he record supports the Chancellor’s
finding that the disparities in educational opportunities available to public school students
throughout the state, found to be constitutionally impermissible, have been caused
principally by the statutory funding scheme, which, therefore, violates the constitutional
guarantee of equal protection.” Id. at 156. It is Plaintiffs’ contention that the ESA Act
deprives students in Davidson and Shelby County schools of adequate and substantially
equal educational opportunities. The issue at hand, however, simply is whether Plaintiffs
have standing to bring their claim. We therefore apply the elements of standing to the facts
alleged by Plaintiffs.

        Here, Plaintiffs have alleged that, as parents of children in the only two school
districts where the ESA Act applies, they are distinctly and palpably injured by the
diversion of funds from their districts to private education purposes.5 Plaintiffs emphasize
that it is only Davidson and Shelby County parents and students who are affected thusly.
Plaintiffs alleged further that their injury is traceable to the ESA Act’s requirement that the
funds be diverted. Regarding redressability, Plaintiffs’ alleged injury could be redressed
judicially in the form of a court order declaring the ESA Act unconstitutional and ordering
an injunction against the ESA Act’s implementation. Plaintiffs have thus met each of the
elements of standing as parents.

      Nevertheless, Defendants argue that any harm to Plaintiffs is purely speculative.
They contend that, should there ever be any loss of funds in Plaintiffs’ districts, such a

5
 We note the Trial Court’s observation that Plaintiff Russell does not claim to have a child affected by the
ESA Act and seeks standing only as a taxpayer.
                                                   -21-
shortfall would not occur until at least three years after the ESA Act’s implementation. In
their brief, State Defendants note, among other things, that “[t]he chancery court found that
funding from the school improvement fund accounted for any loss of money for the first
three fiscal years of the program.”

        State Defendants are correct in that the Trial Court found that, thus far, there has
been no loss of money by the counties or schools at issue. However, Plaintiffs did not
allege that. As a matter of fact, Plaintiffs alleged the opposite. Plaintiffs alleged that the
ESA Act’s purported measures to soften or eliminate loss of funds by the affected districts
do not work and that the counties continue to lose funds. Whether that is ultimately proven
is not before us as this case is only at the motion to dismiss stage. On a motion to dismiss,
the Tennessee Supreme Court has told us quite clearly that courts are required to accept a
plaintiff’s factual allegations as true and construe them in the non-moving plaintiff’s favor,
not the moving defendant’s favor. At the motion to dismiss stage, a plaintiff’s alleged facts
are presumed to be true for purposes of the motion and a defendant must assert that, even
if everything the plaintiff alleges is true, she still is not entitled to relief or, as in the appeal
at bar, she lacks standing.

        By deciding that the school improvement funds accounted for any lost money in the
first three years of the program, the Trial Court erroneously resolved a factual dispute at
the motion to dismiss stage. In their amended complaint, Plaintiffs set out in great detail
their factual allegations why the school improvement funds are not an adequate
replacement for the funds their districts lose under the ESA Act. Plaintiffs alleged, for
example, that “if available, [school improvement funds] cannot be used for general
operating funds and consequently will not replace the state and local BEP funds diverted
from Shelby County Schools and Metro Nashville Public Schools under [the ESA Act].”
Whether that or Plaintiffs’ other factual allegations are ultimately proven is not before us.
What matters now is that Plaintiffs have alleged an illegal diversion of funds from their
districts resulting in a loss not shared by other districts in Tennessee. Our Supreme Court
has not said that we are stuck with a plaintiff’s factual allegations unless it is unlikely they
can be proven. The Trial Court, and this Court, are stuck with Plaintiffs’ factual allegations
at this stage of the case. Here, the Trial Court resolved a factual dispute at the heart of the
case at the motion to dismiss stage. Under the applicable standard of review, this was
reversible error. Given Plaintiffs’ detailed factual allegations, Plaintiffs have established
standing as parents of children in the affected localities.

       Plaintiffs argue further that, in addition to their standing as parents, they also have
standing as taxpayers to challenge the ESA Act. Regarding taxpayer standing, this Court
has stated:

                                                -22-
              Tennessee courts diverge from the federal courts’ approach with
      regard to taxpayer standing. As a general rule, “[t]he mere status of a
      taxpayer or voter is not sufficient to bring an action in and of itself.” Parks
      v. Alexander, 608 S.W.2d 881, 885 (Tenn. Ct. App. 1980). There are,
      however, essentially two routes for taxpayers seeking to establish standing
      in Tennessee. One route hews more closely to the conventional standing
      analysis delineated above in addressing the Couple’s standing. When
      traversing this route to establish standing, a taxpayer must assert a “ ‘special
      interest or a special injury not common to the public generally.’ ” Fannon v.
      City of LaFollette, 329 S.W.3d 418, 427 (Tenn. 2010) (quoting Bennett v.
      Stutts, 521 S.W.2d 575, 576 (Tenn. 1975)); see also Patten v. City of
      Chattanooga, 65 S.W. 414, 420 (Tenn. 1901). The second route, which has
      been long recognized by Tennessee courts, significantly departs from
      conventional federal taxpayer standing, providing an “exception” to the rule
      that a special interest or injury is necessary to establish standing. See
      Fannon, 329 S.W.3d at 427; Badgett v. Rogers, 436 S.W.2d 292, 294 (Tenn.
      1968); Lewis v. Cleveland Mun. Airport Auth., 289 S.W.3d 808, 816 (Tenn.
      Ct. App. 2008); City of New Johnsonville v. Handley, No. M2003-00549-
      COA-R3-CV, 2005 WL 1981810, at *13 (Tenn. Ct. App. Aug. 16, 2005);
      Ragsdale v. City of Memphis, 70 S.W.3d 56, 62-63 (Tenn. Ct. App. 2001).
      When traversing this second route, Tennessee courts “typically confer
      standing when a taxpayer (1) alleges a ‘specific illegality in the expenditure
      of public funds’ and (2) has made a prior demand on the governmental entity
      asking it to correct the alleged illegality.” Fannon, 329 S.W.3d at 427; see
      also, e.g., Lewis, 289 S.W.3d at 817 (indicating that “this Court in City of
      New Johnsonville acknowledged that the Supreme Court in Cobb [v. Shelby
      County Bd. of Comm’rs, 771 S.W.2d 124 (Tenn. 1989)] required three
      elements to establish taxpayer standing: (1) taxpayer status; (2) specific
      illegality in the expenditure of public funds; and (3) the taxpayer has made a
      prior demand on the governmental entity asking it to correct the claimed
      illegality”); Ragsdale, 70 S.W.3d at 62 (stating that, “[i]n order for Plaintiffs
      to have standing to challenge the legality of the expenditure of public funds,
      the Plaintiffs must satisfy three requirements: (1) taxpayer status; (2) an
      allegation of a specific illegality in the expenditure of public funds; and (3)
      prior demand”).

Rutan-Ram v. Tenn. Dep’t of Children’s Servs., No. M2022-00998-COA-R3-CV, 2023
WL 5441029, at *17 (Tenn. Ct. App. Aug. 24, 2023), R. 11 perm. app. filed Oct. 23, 2023.

      In Rutam-Ram, which also was decided on a motion to dismiss, we found “no
support for the limitations proposed by Defendants and conclude that the taxpayer standing
                                            -23-
requirements are the same for state and local taxpayers.” Id. at *21. We held there that
the taxpayer-plaintiffs had standing to sue based on their allegations that the Department
of Children’s Services and its commissioner were “‘violating the religious-freedom and
equal-protection guarantees of the Tennessee Constitution by funding a child-placing
agency that discriminates in state-funded programming against prospective and current
foster parents based on the parents’ religious beliefs.’” Id. The parallels to the present
case are striking.

        There are two paths to taxpayer standing at issue. The first is that of special injury
not common to the public at large. The second is based on an allegation of specific
illegality in the expenditure of public funds, and prior demand. In some instances, a failure
to make prior demand can be excused if demand would have been a mere formality. See
Ragsdale v. City of Memphis, 70 S.W.3d 56, 63 (Tenn. Ct. App. 2001). Beginning with
special injury, Plaintiffs have alleged that as taxpayers in Davidson and Shelby Counties,
they face a special tax burden under the ESA Act that taxpayers elsewhere in Tennessee
do not face. Plaintiffs alleged that they will have to compensate for the ESA Act’s
diversion of funds by raising local taxes. Defendants, in turn, contend that Plaintiffs have
incurred no such harm. Even still, this is the motion to dismiss stage, and we must take
Plaintiffs’ factual allegations as true. Plaintiffs have alleged a special injury not common
to the general public, which gives rise to their standing as taxpayers to challenge the ESA
Act. Plaintiffs have alleged further that this special injury is a result of the diversion of
funds under the ESA Act, and that the injury is redressable through a court order enjoining
implementation of the ESA Act. Plaintiffs have thus shown standing for special injury.

        In addition to the special injury analysis, Plaintiffs have alleged specific illegality
in the expenditure of public funds via the diversion of funds under the ESA Act in violation
of the Education and Equal Protection Clauses of the Tennessee Constitution.6 In Rutan-
Ram, this Court held that the taxpayer-plaintiffs had standing to pursue their claim arguing
that a statute called for an illegal expenditure of public funds on grounds of equal protection
and religious freedom. 2023 WL 5441029, at *21. In Rutan-Ram, we rejected arguments
advanced by State Defendants that specific illegality is restricted to misuse or diversion of
local funds and that the challenged act itself must have a fiscal impact to support an
allegation of the misuse of funds. Id. While we are aware that a Rule 11 perm. app. is still
pending, we see no reason to depart from Rutan-Ram. Here, Plaintiffs allege violations of
equal protection and the education clause of the state constitution. Once again, we take
Plaintiffs’ factual allegations as true at this stage. Plaintiffs alleged that their counties are
singled out for the illegal diversion of public funds, which in turn forces them to raise local
taxes. Whether these allegations have any underlying merit is not now the issue. On issues

6
 Greater Praise Defendants acknowledge that Plaintiffs have alleged specific illegality for all three counts
appealed. However, Greater Praise Defendants argue that prior demand was not excused.
                                                   -24-
of standing, we look to the parties themselves, not their likelihood of success on the merits
of their claims. As our Supreme Court told us in Metro. Gov’t, 645 S.W.3d at 149,
“weakness of a claim on the merits must not be confused with a lack of standing.” Plaintiffs
have alleged enough to show specific illegality in the expenditure of public funds for
purposes of standing at this motion to dismiss stage.

        Prior demand is the next part of the specific illegality analysis. Plaintiffs made no
demand of the state to halt the allegedly illegal activity. The Trial Court held that Plaintiffs
were not excused from making prior demand. However, Plaintiffs alleged in their amended
complaint that the ESA Act was painstakingly guided through the General Assembly and
that the Governor signed the bill into law. Plaintiffs argue on appeal that, in light of the
herculean efforts to pass the ESA Act as alleged in their amended complaint, any demand
on their part would have been futile. Indeed, under the facts alleged by Plaintiffs in their
amended complaint—facts we are confined to at this stage—prior demand would have
been of no avail. The Trial Court held that excusing prior demand in this case would
collapse the rule, but that concern is no substitute for evaluating what Plaintiffs actually
alleged in their amended complaint and whether prior demand would have been futile given
those alleged facts. Based on Plaintiffs’ alleged facts, there was no reasonable likelihood
that, after the deliberate and laborious efforts to pass the ESA Act, officials would have
agreed not to implement the law because Plaintiffs demanded that. Under the facts alleged,
any prior demand by Plaintiffs would have been a mere formality. We therefore hold that,
at this motion to dismiss stage, Plaintiffs’ allegations were sufficient to excuse Plaintiffs
from making prior demand. At the motion to dismiss stage, Plaintiffs have established
standing both as parents and taxpayers for their challenge to the constitutionality of the
ESA Act under the Education and Equal Protection Clauses of the Tennessee Constitution.

        We next address whether the Trial Court erred in ruling that Plaintiffs lacked
standing to challenge the constitutionality of the ESA Act for violating the requirement of
a single system of public schools mandated by the Education Clause of the Tennessee
Constitution. As in the previous issue, Plaintiffs assert that they have standing both as
parents and taxpayers. With respect to standing as parents, Plaintiffs alleged that their
children are harmed by the illegal diversion of funds to support private education at the
expense of public education in their districts and nowhere else. Plaintiffs have alleged
further that the harm is traceable to the ESA and is redressable by court order. Here again,
the merits of Plaintiffs’ claim are not at issue. The strength or weakness of the claim is
beside the point for purposes of standing at the motion to dismiss stage. The question at
this stage is simply whether Plaintiffs have alleged a distinct and palpable injury, a causal
connection to the challenged conduct, and that the harm is redressable by court order. We
hold that Plaintiffs have done so. Namely, Plaintiffs, as parents of students in the districts
allegedly harmed by a diversion of funds under the ESA Act, have alleged that the ESA
Act violates the requirement of a single system of public schools in Tennessee. To hold
                                             -25-
otherwise at this stage of the proceeding would require us to make factual determinations
even though our Supreme Court is clear that would be improper. Plaintiffs have
demonstrated standing as parents on this issue.

       With regard to taxpayer standing, Plaintiffs once again assert special injury and
specific illegality. Plaintiffs have alleged that as taxpayers in Davidson and Shelby
Counties, they are distinctly burdened by an unconstitutional diversion of public funds
under the ESA Act. They assert further that the harm is traceable to the ESA and is
redressable by court order. Based on their allegations, Plaintiffs have established standing
as taxpayers based on a special injury not common to the public at large.

       Plaintiffs also have alleged specific illegality in the form of the ESA Act’s diversion
of public funds from their districts. The Trial Court failed to treat Plaintiffs’ factual
allegations as true as the law requires. In addition, for the reasons already discussed, prior
demand by Plaintiffs would have been futile based on their factual allegations. We hold
that Plaintiffs have alleged enough at the motion to dismiss stage to establish standing as
parents and taxpayers to challenge the constitutionality of the ESA Act for violating the
requirement of a single system of public schools mandated by the Education Clause of the
Tennessee Constitution.

       We next address whether the Trial Court erred in ruling that Plaintiffs lacked
standing to challenge the ESA Act for violating the Appropriation of Public Moneys
provisions of the Tennessee Constitution and Tenn. Code Ann. § 9-4-601.7 Article II,
section 24 of the Tennessee Constitution states, in relevant part: “No public money shall
be expended except pursuant to appropriations made by law. . . . Any law requiring the
expenditure of state funds shall be null and void unless, during the session in which the act
receives final passage, an appropriation is made for the estimated first year’s funding.”
Meanwhile, Tenn. Code Ann. § 9-4-601(a)(1) (West eff. May 16, 2013) provides, as
relevant: “No money shall be drawn from the state treasury except in accordance with
appropriations duly authorized by law.” In their amended complaint, Plaintiffs alleged in
part that “TDOE’s expenditures for the ClassWallet contract, or any other expenditures for
the administration and implementation of the Voucher Law in 2019, without appropriation
for the estimated first year’s funding of the Voucher Law, render the Voucher Law null
and void under Article II, § 24, of the Tennessee Constitution and violate T.C.A. § 9-4-
601.”

       Bah Defendants point to language in certain budget documents from that time to
argue that there was no illegality in the appropriation of funds associated with the ESA

7
  State Defendants do not argue that Plaintiffs failed to allege specific illegality for their sixth cause of
action. Nevertheless, State Defendants contend that prior demand was not excused.
                                                    -26-
Act. They state that ClassWallet was paid with funds that had been intended originally for
a separate but now-discontinued program. Plaintiffs argue in response that Bah
Defendants’ explanations for how ClassWallet was funded are either irrelevant or create a
factual dispute at most. Indeed, we are ruling on standing and ripeness only at the motion
to dismiss stage. It is enough that Plaintiffs have alleged that the state, contrary to law,
paid an organization to administer the ESA Act without an appropriation for the law’s
estimated first year of implementation. Plaintiffs have alleged specific illegality with
regard to their sixth cause of action. In addition, as we have discussed, prior demand by
Plaintiffs would have been futile under the facts alleged. We therefore hold that Plaintiffs
have alleged enough to establish standing to challenge the ESA Act for violating the
Appropriation of Public Moneys provisions of the Tennessee Constitution and Tenn. Code
Ann. § 9-4-601.

        The final issue we address is whether the Trial Court erred in ruling that Plaintiffs’
claims were not ripe. The Tennessee Supreme Court has explained the doctrine of ripeness
thusly:

               Doctrines such as ripeness assist the courts in determining whether a
       particular case presents a justiciable legal issue. Norma Faye Pyles Lynch
       Family Purpose LLC v. Putnam Cnty., 301 S.W.3d 196, 203 (Tenn. 2009).
       The ripeness doctrine focuses on whether the dispute has matured to the point
       that it warrants a judicial decision. The central concern of the ripeness
       doctrine is whether the case involves uncertain or contingent future events
       that may or may not occur as anticipated or, indeed, may not occur at all. See
       Lewis v. Cont’l Bank Corp., 494 U.S. 472, 479-80, 110 S.Ct. 1249, 108
       L.Ed.2d 400 (1990). It is closely related to the “exhaustion of administrative
       remedies” doctrine. 13B Charles A. Wright, Arthur R. Miller & Edward H.
       Cooper, Federal Practice and Procedure § 3532.1.1 (3d ed. 2008).

              Determining whether a particular dispute is ripe entails a two-part
       inquiry. The first question is whether the issues in the case are ones
       appropriate for judicial resolution. The second question is whether the
       court’s refusal to act will cause hardship to the parties. Abbott Labs. v.
       Gardner, 387 U.S. 136, 149, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967), partially
       superseded by statute, Clean Air Amendments of 1970, Pub.L. No. 91-604,
       84 Stat. 1676 (codified as amended at 42 U.S.C.A. § 7607 (1997 & 2010
       Supp.)); accord Martin v. Washmaster Auto Ctr., Inc., No. 01-A-01-9305-
       CV00224, 1993 WL 241315, at *2 (Tenn. Ct. App. July 2, 1993) (No Tenn.
       R. App. P. application filed). The court will decline to act “where there is no
       need for the court to act or where the refusal to act will not prevent the parties
       from raising the issue at a more appropriate time.” AmSouth Erectors, LLC
                                             -27-
        v. Skaggs Iron Works, Inc., No. W2002-01944-COA-R3-CV, 2003 WL
        21878540, at *6 (Tenn. Ct. App. Aug. 5, 2003) (No Tenn. R. App. P. 11
        application filed) (quoting Window Gallery of Knoxville v. Davis, No.
        03A01-9906-CH-00225, 1999 WL 1068730, at *3 (Tenn. Ct. App. Nov. 24,
        1999) (No Tenn. R. App. P. application filed)) (emphasis omitted).

B & B Enters. of Wilson Cnty., LLC v. City of Lebanon, 318 S.W.3d 839, 848-49 (Tenn.
2010).

        Plaintiffs argue that their first cause of action is ripe because they have alleged that
the ESA Act’s adverse impact on Davidson and Shelby County schools is underway now
and that the increased tax burden from the diversion of funds likewise began with the
implementation of the ESA Act. As for their second cause of action, Plaintiffs contend
that the illegal diversion of funds damages the single system of public schools in Tennessee
in the here and now; that it is not speculative; and that now is the appropriate time to address
it. Regarding their sixth cause of action, Plaintiffs point out that all facts relevant to this
particular claim already have occurred.8 Plaintiffs state further that they will suffer
meaningful hardship if judgment is withheld because their children’s schools are being
deprived of educational resources.

        For their part, State Defendants argue that Plaintiffs’ first and second causes of
action are not ripe. They say that local education agencies will keep certain TISA funds
associated with participating students without the corresponding obligation to educate
them; that for the first three years of the ESA Act, an annual grant in an amount equal to
the amount in the students’ ESA account will be disbursed to the local education agency
for school improvement; and that the ESA Act likely will produce a windfall for local
education agencies and their students. As to any hardship posed to Plaintiffs, State
Defendants contend that Plaintiffs do not face any serious criminal or civil penalties and
that, at any rate, the ESA Act only regulates local education agencies, not Plaintiffs.

       We reiterate that, under the applicable standard of review, we must take Plaintiffs’
factual allegations as true. Plaintiffs have alleged that they being harmed by the
implementation of the ESA Act in the here and now, not in a hypothetical future scenario.
Plaintiffs have thus alleged a live, active controversy. Whether Plaintiffs’ allegations are
proven or even likely to be proven is beyond this Opinion. It is enough for purposes of the
standard of review on a motion to dismiss that Plaintiffs have alleged that harm to them is
unfolding at present and will continue to unfold absent a court order favorable to them.
With respect to the hardship aspect of the ripeness analysis, Plaintiffs have alleged that the

8
  State Defendants concede the ripeness of Plaintiffs’ sixth cause of action. This is appropriate as all facts
relevant to this claim have in fact already occurred.
                                                    -28-
ESA Act imposes a heightened tax burden on them specifically and drains their school
districts of funds in a manner not experienced by other districts. Defendants have not cited
to any law requiring that a plaintiff face criminal or civil penalties before the plaintiff’s
claim is ripe. To be sure, facing criminal or civil penalties certainly could impose the
meaningful hardship necessary for ripeness, but it is not essential. Taking Plaintiffs’
factual allegations as true, as we must at this motion to dismiss stage, Plaintiffs’ first,
second, and sixth causes of action are ripe for judicial review.

        We expressly decline to rule on whether Plaintiffs have stated a claim for which
relief can be granted. Furthermore, we take no position on the wisdom or unwisdom of the
ESA Act, which is a legislative matter. The standard of review on a motion to dismiss
compels the result we reach. In sum, we hold that Plaintiffs have alleged enough at the
motion to dismiss stage to establish standing to assert their first, second, and sixth causes
of action. We hold further that Plaintiffs’ claims are ripe for judicial review. We reverse
the judgment of the Trial Court as to Plaintiffs’ first, second, and sixth causes of action and
remand for further proceedings consistent with this Opinion.

                                         Conclusion

       The judgment of the Trial Court is reversed as to Plaintiffs’ first, second, and sixth
causes of action, and this cause is remanded to the Trial Court for collection of the costs
below and further proceedings consistent with this Opinion. The costs on appeal are
assessed against the Appellees.

                                           ____________________________________
                                           D. MICHAEL SWINEY, CHIEF JUDGE

                                             -29-