Class-action status sought for lawsuit against state's Basic Education Program

Shelby County explores separate suit over school funding formula

In this Tuesday, April 15, 2014, photo, Brianna Reed, 7, center, reads out loud to the rest of the participating students at Knowledge Quest, one of dozens of nonprofit groups with an after-school tutoring program in Memphis, Tenn. The Shelby County Schools system is going to hire a lawyer so the district can begin the "appropriate legal action" to force the state to properly fund schools through the Basic Education Program.

Every school district in Tennessee could be part of the Hamilton County Department of Education's lawsuit against the state's Basic Education Program school funding formula if a judge grants a motion to grant it class-action status.

"While the larger districts have been the ones voicing concerns about the underfunding of education, this underfunding has ramifications literally everywhere," school district attorney D. Scott Bennett said.

Hamilton County Schools and six nearby school districts -- Bradley, Coffee, Grundy, Marion, McMinn and Polk -- are plaintiffs in the lawsuit Bennett filed on March 24 in Davidson County Chancery Court.

The suit claims the state has "breached its duty under the Tennessee Constitution to provide a system of free public education for the children of this state."

The lawsuit argues the state doesn't provide enough funding for numerous expenses, including teacher pay and health insurance. The state underestimates by about $10,000 what teachers are actually paid, the lawsuit says, and pays only for 10 months of teachers' 12 months of insurance.

We thought it important to get the participation of other area school systems."

Attorneys for the state deny the entire claim.

Bennett's lawsuit should be "dismissed in its entirety," said a 32-page memorandum filed in late April by Kevin Steiling, deputy state attorney general. The lawsuit relies on a "profoundly flawed interpretation" of three successful previous lawsuits against the BEP, the memo states.

"These pleas for more funding are not properly directed to the courts of Tennessee -- they must be directed to the General Assembly," Steiling wrote.

In his 2015-16 budget, which the Legislature passed after the lawsuit was filed, Gov. Bill Haslam added an extra $100 million for teacher salaries and $44 million for inflationary increases in the BEP, along with $30 million to pay for one more month of health insurance for teachers.


The lawsuit is being funded by Hamilton County. The smaller districts aren't paying, but Bennett said they will provide data to support the argument that the General Assembly continues to underfund education despite years of recommendations from the BEP Review Committee to increase funding.

"We thought it important to get the participation of other area school systems," Bennett said. "Of course, because of their smaller size, these boards cannot contribute financially to the suit."

Meanwhile, the board of Shelby County Schools in West Tennessee voted this past week to investigate separate legal action against the state over the BEP.

Shelby County Schools Superintendent Dorsey Hopson didn't respond to a request for comment. Hopson was hired in 2008 as Shelby County Schools' attorney before he became superintendent in 2013, and Hopson helped "win a $57.4 million dollar judgment against the city of Memphis in a landmark case involving educational funding," the school district's website says.

Bennett said the Atlanta legal firm that Hopson once worked for may sue Tennessee over the BEP.

"My understanding is that they are going to retain the firm that Dorsey was with when he was in private practice," Bennett said. "I've been hearing that ... probably since late February."


Meanwhile, Republican lawmakers from Chattanooga's delegation to the General Assembly reiterated their opposition to Hamilton County Schools' lawsuit last week to Times Free Press reporters and editors.

"They are suing the taxpayers, that's who they are suing," said House Majority Leader Gerald McCormick, R-Chattanooga.

Fully funding the BEP has been estimated to cost $500 million. McCormick said that would have to come out of existing programs, such as funding colleges and universities, because the state constitution mandates K-12 education but not higher education. And Tennesseans don't want higher taxes, he said.

"It would be devastating to higher ed," McCormick said. "I do not think that the people of the state are willing to raise taxes."

The lawmakers said the BEP lawsuits were motivated by lawyers trying to earn fees. But Bennett, who charges $190 an hour, said he doesn't anticipate the action will increase the school district's legal fees significantly.

"We have not hired additional staff to work this file," he said. "So pursuing this case has simply pulled us from other work that we would be doing for the board of education."

Bennett expects to get a hearing on his class-action motion before the end of June.

Contact staff writer Tim Omarzu at or or or 423-757-6651.