NC Supreme Court throws out multibillion-dollar plan, ends long-running Leandro lawsuit

The North Carolina Supreme Court on Thursday threw out the multibillion-dollar plan to improve North Carolina’s public schools in a ruling that ended the long-running lawsuit known as Leandro.

Hoke County Board of Education v. State of North Carolina was initially filed in 1994 and accuses the state of not providing an adequate education to the state's more than 1 million students. The lawsuit has sought to shore up education in the state and improve outcomes for the state’s students.

WATCH: Arguments in Hoke County Board of Education et al. V State of North Carolina

Parties had come to an agreement on a plan in 2021 that would have drastically increased funding by more than $5 billion — funding for things such as special education, teacher pay, counselors, social workers and school nurses. It also included many policy changes, on things such as school improvement.

The court threw out that plan Thursday in a 4-3 decision. The ruling invalidates the last decade's worth of actions in the case. But instead of remanding the lawsuit for further action on the claims of the original five school boards that sued — Cumberland, Hoke, Halifax, Vance and Robeson — the court dismissed the case entirely without giving parties the ability to re-file. Justices in the majority tossed the case in part because they contended that today’s education system has changed too much in the past 20 years and that the lack of any current students as plaintiffs means no plaintiffs have their rights at issue. 

Recommended: Leandro: The case for a sound basic education

The majority vacated any action taken in the case since July 24, 2017 — a day in which a lower court had ruled in the case — arguing the case had fundamentally changed at that time from one questioning the adequacy of the education provided in those five counties to one that raises that question statewide. The lower court didn’t have the jurisdiction to hear a statewide concern, the ruling states.

In its conclusion, the majority suggested that the parties resolve the issue among themselves.

“In short, the judicial branch is not the venue in which to seek education policy reform,” Chief Justice Paul Newby wrote in the majority opinion.

Republican Justice Richard Dietz and Democratic Justices Anita Earls and Allison Riggs dissented.

Earls contended the court was freeing the state from having to provide a sound basic education to the state’s children. Riggs echoed that.

“The majority’s message to our children is clear: pull yourself up by your bootstraps, but there is nothing this court will do if the political branches never met their obligation to put boots on your feet in the first place,” Riggs wrote.

Dietz lamented that the case has “lost its way” but argued it could, and should, have gotten back on track, calling the court’s decision “the end of Leandro as a lawsuit.” He expects the constitutional issues raised to be raised again in another court.

In a concurring opinion, Justice Phil Berger Jr. said he wished the court had declared that it cannot order funds to be distributed in a manner that bypasses the General Assembly. 

The 2022 Supreme Court decision had ordered the funding of the now-thrown-out plan via checks written by state executives, rather than appropriated in a bill signed into law.

A spokesperson for House Speaker Destin Hall on Thursday reflected a similar sentiment. The Caldwell County Republican replaced former Speaker Tim Moore as an intervenor in the case.

“Today’s decision rightly recognizes the constitutional role of the North Carolina General Assembly, since the state Constitution entrusts sole appropriations authority to the legislature,” said Demi Dowdy, Hall’s spokeswoman. “House Republicans remain committed to investing in public education, including through our budget proposal to raise starting teacher pay to $50,000 and provide 8.7% average raises to our public school teachers.”

Senate leader Phil Berger, R-Rockingham, similarly praised the decision.

“For decades, liberal education special interests have improperly tried to hijack North Carolina's constitutional funding process in order to impose their policy preferences via judicial fiat,” he said. “Today's decision confirms that the proper pathway for policymaking is the legislative process.”

Senator Berger said North Carolina students “have access to world-class educational opportunities” and said the legislature is committed to improving education in the state. 

The House and Senate haven’t yet agreed on a budget for the current year and propose different amounts of education funding.

Senator Berger, who will leave office at the end of the year after losing his primary election, is the father of Justice Berger. 

Robb Leandro, an original plaintiff who graduated from Hoke County Schools and became a lawyer, said he was hopeful elected officials will work together to provide a sound basic education to North Carolina students.

“But if they do not,” Leandro told WRAL Thursday, “I view today’s decision by the court as an invitation to the thousands of children being denied the right to a basic education to continue the fight in courtrooms across the state to demand that our schools be fixed.”

Gov. Josh Stein, who represents the state as a defendant party in the case, supported the multibillion-dollar plan and on Thursday expressed his disappointment that it was struck down.

“Education opens doors of opportunity for children, but today the Court slammed them in the face of students who deserve the right to a sound basic public education,” Stein said in a statement.

Hoke and Cumberland County officials said they were disappointed by the ruling but said they remained committed to providing a quality education and vowed to fight for more investment in their school systems. 

“Public education is an investment in the future of our society,” Cumberland County’s education board said in a statement. “... We will continue to advocate for adequate state funding for Cumberland County Schools and the other low-wealth school districts across North Carolina.”

Hoke County Schools Superintendent Kenneth Spells added that the ruling “does not change the ongoing reality that many students — particularly in rural communities like Hoke County — continue to face barriers to the sound, basic education our constitution promises.”

State Rep. Garland Pierce, a Democrat who represents Hoke, lamented the decision and was doubtful counties could provide the education they sought on their own.

“The tax base is not there,” he said. “That creates a problem for the schools getting less money in those communities, those rural areas.”

Representatives of the other districts didn’t immediately respond to requests for comment.

Families waiting decades

The case is known as “Leandro,” for a former plaintiff who has since graduated high school. Plaintiffs argued they didn’t have the resources to provide an adequate education and largely blamed the state for what they said was insufficient funding. 

The case has been on a long journey through state courts over arguments on issues running the gamut from education to separation of powers in the state. 

In 1997, the North Carolina Supreme Court ruled that the state’s children were entitled to a sound basic education under the North Carolina Constitution.

In 2002, after a 14-month trial, Wake County Superior Court Judge Howard Manning determined the state wasn’t providing that and ordered the state ensure a “high quality” teacher in every classroom, a “well prepared” principal in every school, adequate resources, and pre-kindergarten for students at risk of not succeeding academically.

In 2004, the North Carolina Supreme Court affirmed most of Manning’s ruling, but said the court could not require pre-kindergarten be offered because state law doesn’t require schooling until a child is 7 years old.

The state’s highest court never found that state funding was inadequate, and it determined that the quality of education across the state’s school systems doesn’t need to be equal. The court found in 2004, however, that the education being provided was inadequate in Hoke County but declined to make a statewide ruling at that time. The 2022 court ruling considered Manning’s letter a statewide finding. Before 2022, the court had ruled the inadequacy could be the result of a lack of funding or the result of improper oversight or execution of education — or a combination.

The 2004 court finding was based on the litigation in Hoke County, though the case involved evidence from other school systems. The 2004 state Supreme Court ruling asked the superior court to revisit the extent of the inadequacy across more school systems. No further trials were held. Instead, the court held frequent hearings on updates with the state and with plaintiffs and eventually ordered them to fix the problems. After years of fighting the case, parties agreed in 2018 to hire a consultant to evaluate where the state’s education system could improve, through policy, practice or funding.

WestEd, a California-based consultant, led the review with the Learning Policy Institute and North Carolina State University Friday Institute. It released its findings in 2019. Parties agreed to a plan based on the findings in 2021.

The ruling comes as many students across North Carolina are on spring break.

Still, the decision has left education funding top of mind for many parents.

"Some of us don't have the ability to decide what schools we go to based on the resources that are available," parent Janique Cantey said. "If we had a good amount of resources going to all the schools, we wouldn't have to pick and choose."

Now, some parents are calling for more to be done after the reversal.

"School funding is just not being funded at a level that it should be to provide them equal opportunity and really thrive," parent Paris Butler said.

Ordering the state to comply

But after the state General Assembly declined to adopt the plan into state law, then-Superior Court Judge W. David Lee ordered state executives to cut checks for it anyway. 

That prompted legal challenges from General Assembly leaders and the state controller, who said the court was contradicting the state constitution’s provisions on the General Assembly being the decision-makers when it comes to what’s in the state budget.

In 2022, the state Supreme Court, which then had a 4-3 Democratic majority, backed Lee’s order, arguing that the constitution also promises a sound basic education, which the plan would attempt to provide. The court ordered the superior court to conduct a tabulation of what was left to spend in the plan, which state executives would then be required to cut checks for.

Related: What is the Leandro Plan?

The court also contended that a letter from Manning, following hundreds of hours of hearing spanning years from representatives of various counties, was sufficient to establish the statewide finding — that North Carolina was failing to provide an adequate education statewide.

Parties in the case eventually determined that $677.8 million was still owed through June 30, 2023. By 2028, at the time of the estimate, another $4 billion to $5 billion more would be needed annually. After that, the state passed a new budget in 2023 but has not passed one since then.

Senate leader Phil Berger, R-Rockingham, and then-House Speaker Tim Moore, R-Cleveland, and State Controller Nels Roseland appealed that Superior Court order on the tabulation to the state Supreme Court.

During a February 2023 state Supreme Court hearing, a 5-2 Republican-majority court, entertained arguments from the lawmakers challenging some of the same issues brought before the Supreme Court in 2022. But they also challenged whether the Leandro Plan was properly ordered in the case anyway, because they said the court has never ruled that the state was failing school systems across North Carolina.

CORRECTION: An earlier version of this story incorrectly identified the county Pierce represents. It's Hoke and Scotland counties.