In a bid to settle the nearly five-year old school finance lawsuit pending against the state of Arizona, Governor Doug Ducey and the state Legislature have agreed to spend an additional $3.5 billion on education over the next decade.  About 60 percent of this money would come from increased withdrawals from the state’s permanent land trust fund, and the rest from the general fund.

The lawsuit stems from the state’s drastic cuts to education in the wake of the Great Recession, which has left Arizona ranked last among the 50 states in education spending, according to 2013 U.S. Census Bureau data. Plaintiffs in the case, Cave Creek Unified School District v. Arizona,  argued that the state’s cuts to education spending were impermissible under the terms of a voter-approved referendum (known as Proposition 301) requiring state education spending to keep apace with inflation.  

Since 2010, the case has wound its way through Arizona’s court system. And judges from the Arizona Supreme Court, the Arizona Court of Appeals, and the Maricopa County Superior Court have agreed with Arizona’s plaintiffs’ contentions that the Legislature lacked the authority to make such drastic cuts to education. Most recently, in August 2014, Maricopa County Superior Court Judge Katherine Cooper ordered the Legislature to comply with Proposition 301 by immediately increasing school funding to levels consistent with inflation; she  also scheduled an evidentiary hearing to determine whether school districts were entitled to recoup funding improperly withheld by the state from 2009-2014. However, mediation between the parties on a potential settlement to the lawsuit began in January 2015, and by last summer it appeared that the Legislature and Governor were actively working towards crafting a legislative package addressing the budgetary shortfalls created by the state’s recessionary cuts to education.

The funding package passed by the Legislature and approved by the Governor last week now must be approved by Arizona voters in a special election on May 17, 2016.