Bricker & Eckler LLP: DeRolph v. State: Order of the Perry County Court of Common Pleas

IN THE COMMON PLEAS COURT, PERRY COUNTY, OHIO

DALE R. DeROLPH, Parent and Next Friend of NATHAN DeROLPH RANDY MISKELL NORTHERN LOCAL SCHOOL DISTRICT FINDINGS OF FACT, BOARD OF EDUCATION CONCLUSIONS OF LAW, ORDER AND MEMORANDUM J. KENNETH MILLER, a Member of CASE NO. 22043 the Northern Local School District Board of Education STEVEN JOHNSON, Superintendent of the Northern Local School District KEELY THOMPSON, Parent and Next Friend of CHRISTOPHER THOMPSON, a Minor JOSEPH WINNENBERG SOUTHERN LOCAL SCHOOL DISTRICT BOARD OF EDUCATION LOUIS ALTIER, a Member of the Southern Local School District Board of Education CAROL SPANGLER, Superintendent of the Southern Local School District DONNA BLANKENSHIP, Parent and Next Friend of JAMI BLANKENSHIP MARK SEMANCO DAWSON-BRYANT LOCAL SCHOOL DISTRICT BOARD OF EDUCATION CARL SWARTZWELDER, a Member of the Dawson-Bryant Local School District Board of Education WAYNE WHITE, Superintendent of the Dawson-Bryant Local School District DAVID BOWERS, Parent and Next Friend of ANDREW BOWERS, a Minor CHRISTOPHER BOWERS, a Minor JON CARVER LIMA CITY SCHOOL DISTRICT BOARD OF EDUCATION JAMES EATON, a Member of the Lima City School District Board of Education CHARLES BUROKER, Superintendent of the Lima City School District Board of Education MARION GARY SOUTHERS, Parent and Next Friend of SHERRI SOUTHERS, a Minor BRIAN SOUTHERS. a Minor ROBERT RIOS YOUNGSTOWN CITY SCHOOL DISTRICT BOARD OF EDUCATION SOCRATES KOLITSOS, a Member of the Youngstown City School District Board of Education and EMANUAL CATSOULES, Superintendent of the Youngstown City School District Board of Education PLAINTIFFS VS . STATE OF OHIO c/o Attorney General of Ohio STATE BOARD OF EDUCATION OF OHIO TED SANDERS, Superintendent of Public Instruction and OHIO DEPARTMENT OF EDUCATION This action at bar was heard by the undersigned Judge of the Court of Common Pleas for Perry County at New Lexington, Ohio commencing October 25, 1993 and concluding December 8, 1993. Nicholas A. Pittner, John F. Birath, Jr., Sue Wyskiver Yount and Michael D. Smith appeared on behalf of the Plaintiffs. Attorney General Lee Fisher, Assistant Attorney General Christopher Culley, Mark A. Vander Laan, Joel S. Taylor, William M. Mattes and David K. Mullen represented the Defendants. A Brief of Amici Curiae was filed by Kimball H. Carey on behalf of the Buckeye Association of School Administrators and Ohio School Boards Association. TABLE OF CONTENTS FINDINGS OF FACT I. STIPULATIONS II. BIOGRAPHIES OF WITNESSES III. THE ENTITLEMENT TO ELEMENTARY AND SECONDARY PUBLIC EDUCATION IN OHIO AND THE ADMITTED INEQUITIES IN THE PROVISION OF ENTITLED EDUCATIONAL SERVICES IV. THE HISTORY OF SCHOOL FUNDING IN OHIO A. HISTORY OF OHIO'S PUBLIC SCHOOL FUNDING SYSTEM B. EDUCATION APPROPRIATIONS AS A FUNCTION OF THE STATE BUDGET C. THE IMPACT OF STATE BUDGET REDUCTIONS ON PUBLIC EDUCATION D. BUDGET AND POLICY RECOMMENDATIONS OF THE STATE BOARD OF EDUCATION V. OPERATION OF THE SCHOOL FOUNDATION PROGRAM A. THE FOUNDATION FORMULA B. STATE BASIC AID C. THE RELIABILITY OF STATE FUNDING AND FORM SF-12 D. GUARANTEE PROVISIONS E. CATEGORICAL FUNDING F. SPECIAL EDUCATION UNIT FUNDING. G. VOCATIONAL UNIT FUNDING H. DPIA I. LOCAL REVENUE 1. PROPERTY CLASSIFICATIONS AND TAX ASSESSMENT 2. HOUSE BILL 920 AND TAX REDUCTION FACTORS 3. OPERATION OF THE TWENTY MILL FLOOR OF TAX RATE REDUCTION 4. OTHER TYPES OF TAX LEVIES AVAILABLE TO SCHOOL DISTRICTS 5. SCHOOL DISTRICT INCOME AND ITS EFFECT ON LOCAL REVENUE 6. LOCAL TAX LEVIES 7. LOCAL TAX EFFORT 8. THE EFFECT OF LOCAL TAX ABATEMENTS AND EXEMPTIONS, ZONING LAWS AND ECONOMIC CLIMATE J. REVENUE AND EXPENDITURE DISPARITIES THROUGHOUT K. FEDERAL FUNDS L. EQUITY FUNDS M. STUDY PERFORMED BY HOWARD FLEETER N. LEGISLATIVE TESTIMONY PRESENTED ON BEHALF OF THE OHIO DEPARTMENT OF EDUCATION AND STATE BOARD OF EDUCATION BY ASSISTANT SUPERINTENDENT OF PUBLIC INSTRUCTION WILLIAM PHILLIS O. EQUITY STATISTICS AS RELATED TO ANALYSES OF PUBLIC SCHOOL FUNDING IN OHIO VI. FINANCIAL DISTRESS: THE RESULT OF OHIO'S SCHOOL FUNDING SYSTEM A. SCHOOL CLOSINGS FOR LACK OF FUNDS PROHIBITED B. FINANCIAL DISTRESS IN THE PLAINTIFF SCHOOL DISTRICTS VII. SCHOOL DISTRICT BORROWING A. THE OFFICE OF SCHOOL MANAGEMENT ASSISTANCE B. SPENDING RESERVE LOANS C. THE OPERATION OF THE EMERGENCY SCHOOL ASSISTANCE LOAN PROGRAM D. MANDATORY REDUCTIONS IN SCHOOL DISTRICT EXPENDITURES E. THE MAGNITUDE OF BORROWING UNDER THE EMERGENCY SCHOOL ADVANCEMENT LOAN PROGRAM F. TRENDS IN BORROWING G. SPECIFIC LOAN DISTRICTS, INCLUDING PLAINTIFFS H. RECEIVERSHIP VIII. FACILITIES A. GENERAL B. CLASSROOM FACILITIES ACT, OHIO REVISED CODE CHAPTER 3318 C. EMERGENCY SCHOOL REPAIRS PROGRAM D. 1990 OHIO PUBLIC SCHOOLS FACILITIES SURVEY E. ARCHITECTURAL BARRIER ABATEMENT F. ASBESTOS ABATEMENT G. FACILITIES IN PLAINTIFF SCHOOL DISTRICTS H. FACILITIES IN SCHOOL DISTRICTS COMPARED TO PLAINTIFFS I. STATE INACTION IX. EDUCATIONAL INPUTS A. CLASS SIZE AND STAFFING RATIOS OVERVIEW CLASS SIZE AND STAFFING RATIOS IN PLAINTIFF SCHOOL DISTRICTS B. PAY SCALES AND RECRUITING OF STAFF OVERVIEW PAY SCALES AND RECRUITING OF STAFF IN PLAINTIFF DISTRICTS C. COLLECTIVE BARGAINING D. TEACHER CERTIFICATION AND TRAINING E. CURRICULA MODEL CURRICULA CURRICULA IN PLAINTIFF SCHOOL DISTRICTS COMPARISONS OF THE SCIENCE CURRICULA IN PLAINTIFF SCHOOL DISTRICTS TO OTHER SCHOOL DISTRICTS F. GUIDANCE SERVICES OVERVIEW GUIDANCE SERVICES IN PLAINTIFF SCHOOL DISTRICTS G. EXTRACURRICULAR OFFERINGS IN PLAINTIFF SCHOOL DISTRICTS OVERVIEW H. BOOKS, EQUIPMENT, AND SUPPLIES IN PLAINTIFF SCHOOL DISTRICTS OVERVIEW I. VOCATIONAL EDUCATION J. TECHNOLOGY OVERVIEW TECHNOLOGY IN PLAINTIFF SCHOOL DISTRICTS X. MINIMUM STANDARDS A. MINIMUM STANDARDS EVALUATIONS THROUGHOUT OHIO PRE-1983 STANDARDS B. MINIMUM STANDARDS IN PLAINTIFF DISTRICTS XI. EDUCATIONAL OUTPUTS A. OUTCOMES-BASED EDUCATION B. PROFICIENCY TESTS C. THE RELATIONSHIP BETWEEN SCHOOL DISTRICT EXPENDITURES AND PERFORMANCE ON PROFICIENCY TESTS AND ACHIEVEMENT TESTS D. TESTING IN PLAINTIFF SCHOOL DISTRICTS E. DROPOUT RATES, GRADUATION RATES, AND NON- ATTENDANCE F. EXCELLENT AND DEFICIENT SCHOOLS G. EFFECTIVE SCHOOLS PROGRAM H. PARTICIPATION IN HIGHER EDUCATION I. EDUCATION 2000 GOALS XII. SPECIAL EDUCATION A. STATE AND FEDERAL REQUIREMENTS REGARDING SERVICES FOR SPECIAL EDUCATION PUPILS B. FUNDING FOR SPECIAL EDUCATION C. FEDERAL GOVERNMENT EVALUATION OF OHIO (OSEP REPORT) D. STATE REVIEW OF SCHOOL DISTRICTS E. SERVICES TO SPECIAL EDUCATION PUPILS IN THE SEOSERRC REGION F. SERVICES TO AND FUNDING FOR SPECIAL EDUCATION PUPILS IN PLAINTIFF SCHOOL DISTRICTS G. SERVICES TO SPECIAL EDUCATION PUPILS IN HIGH AND LOW CAPACITY DISTRICTS AND COMPARISONS TO PLAINTIFF SCHOOL DISTRICTS H. PRESCHOOL SPECIAL EDUCATION I. SECTION 504 OF THE REHABILITATIVE MANDATES XIII. UNSERVED PUPILS A. CHAPTER PROGRAMS B. PRESCHOOL EDUCATION C. HEAD START D. SCHOOL-AGE CHILD CARE E. KINDERGARTEN F. GIFTED EDUCATION G. CHILDREN FROM LOW INCOME FAMILIES AND PUPILS ON ADC H. FREE AND REDUCED PRICE LUNCH I. AT RISK CHILDREN J. THE SPECIAL NEEDS OF THE INNER DISTRICTS K. RACIAL AND ETHNIC CONSIDERATIONS XIV. TRANSPORTATION A. OPERATION B. BUS PURCHASES C. TRANSPORTATION OF HANDICAPPED PUPILS XV. LOCAL CONTROL A. UNFUNDED MANDATES B. THE EDUCATIONAL MANAGEMENT INFORMATION SYSTEM C. LOAN PROGRAM AND RECEIVERSHIP DISTRICTS D. PLAINTIFF SCHOOL DISTRICTS DO NOT HAVE LOCAL CONTROL XVI. THOROUGH AND EFFICIENT CLAUSE XVII. EQUALITY OF EDUCATIONAL OPPORTUNITY A. EDUCATIONAL OPPORTUNITIES ARE NOT EQUITABLY DISTRIBUTED IN OHIO B. DR. ALEXANDER'S CURRICULUM STUDY C. PLAINTIFF DAWSON-BRYANT COMPARED WITH THE BEACHWOOD CITY SCHOOL DISTRICT D. PLAINTIFF NORTHERN LOCAL SCHOOL DISTRICT COMPARED WITH GRANVILLE CITY SCHOOL DISTRICT E. PLAINTIFF SOUTHERN LOCAL COMPARED TO RICHMOND HEIGHTS LOCAL SCHOOL DISTRICT AND WORTHINGTON CITY SCHOOL DISTRICT F. PLAINTIFF YOUNGSTOWN COMPARED WITH THE MAYFIELD HEIGHTS CITY SCHOOL DISTRICT XIII. FUNDAMENTALITY CONCLUSIONS OF LAW I. THE PARTIES II. THE FOLLOWING PROVISIONS OF THE OHIO CONSTITUTION ARE APPLICABLE TO THE CLAIMS ASSERTED BY THE PLAINTIFFS IN THIS CASE III. THE FOLLOWING PROVISIONS OF THE OHIO REVISED CODE AND THE EFFECTS THEREOF ARE APPLICABLE TO THE CLAIMS OF PLAINTIFFS IN THIS CASE IV. HARM TO THE PLAINTIFFS V. THE COURT HEREBY ORDERS AND DECLARES MEMORANDUM FINDINGS OF FACT I. STIPULATIONS The parties filed final Joint Stipulations of Fact with the Court on October 1, 1993. During the course of trial on November 29, 1993, the parties supplemented those Stipulations. This Court hereby incorporates the Final Joint Stipulations of Fact, including the Exhibits thereto, into these Proposed Findings of Fact and Conclusions of Law. II. BIOGRAPHIES OF WITNESSES 1. Kern Alexander Dr. Alexander is a Distinguished Professor at Virginia Tech in Blacksburg, Virginia, and he has held that position since 1988. Previous to that, he served as president of Western Kentucky University, an institution of approximately 15,000 pupils where he served for a period of three years. Dr. Alexander was a full professor at the University of Florida where he taught school finance for approximately 18 years. During that time, he also served as Associate Director of the National Education Finance Project, and while on leave from the University, coordinated the education budget for the State of Florida from 1982 to 1985. Dr. Alexander holds a Bachelor of Arts Degree from Center College in Danville, Kentucky; a Master of Arts Degree from Western Kentucky University; a Doctor of Education Degree from Indiana University; and a Diploma in Educational Studies from the University of Oxford, Oxford, England. Prior to his college teaching, Dr. Alexander worked on a study of Kentucky school finance before joining the U.S. Department of Education where he served for approximately two years. Dr. Alexander also founded the Journal of Education Finance and served as its chief editor for approximately 18 years. The journal is a national publication and generally considered to be one of the leading publications dedicated to the field of school finance. In addition, Dr. Alexander has edited or authored 20 books on the subject of school law and school finance. One of his publications, American Public School Law, published in 1992, is used as a textbook in graduate schools and universities around the country, as well as some law schools around the country. Dr. Alexander has also published numerous articles on topics related to school law and school finance, including an article in the Harvard Journal of Legislation reviewing the decision in the Kentucky school funding case. In addition to his work in Ohio, Dr. Alexander has conducted studies of funding systems in the States of Tennessee, Arkansas, New Hampshire, Indiana, Utah, and others. He testified in the Kentucky, Tennessee, Alabama, Missouri, Rhode Island, and Montana funding cases. (Alexander Tr. 3584-605; Resume is Pl. Exh. 303) 2. Louis Altier Louis Altier is a graduate of the schools in Perry County. He is President of the Southern Local Board of Education, where he has served for 22 years. He is Chairman of the Board of the Corning Bank, and is President of Altier Brothers, an oil and gas company. He is a life-long resident of Perry County, Ohio. (Altier Tr. 1287-88, 91) 3. Stanley J. Aronoff Stanley J. Aronoff is President of the Ohio Senate. Senator Aronoff was elected to the Ohio House of Representatives in 1960. After serving three terms in the House, he was elected to, and began serving in, the Senate in 1967, and has served continually in the Senate since that time. Currently, Senator Aronoff is Chairman of the Rules Committee, is Chair of the Legislative Service Commission, is a member of the Legislative Budget Office, and is an ex-officio member of every other Senate committee. Senator Aronoff also has served as Chairman of the Senate Finance Committee for six years, and was ranking minority leader on that Committee for two years. Senator Aronoff served on the Gilmore Cupp Committee pertaining to school equity. He also served on the Education 2000 Commission under Governor Celeste. (Aronoff Tr. 4805-10) 4. Craig Axline Craig Axline is a guidance counselor, teacher and coach at Plaintiff Southern Local School District, where he has been employed for seventeen years. Mr. Axline teaches math, advanced math and advanced math II in the eleventh and twelfth grades. Mr. Axline coached girls' volleyball and girls' basketball. Mr. Axline graduated from Sheridan High School, received a Bachelor of Science in Education from Ohio University in 1975, holds a Master's degree in Math Education. Mr. Axline holds teaching certifications in guidance and mathematics. (Axline Depo. 4-10) 5. Jamie Blankenship Jamie Blankenship, a Plaintiff student, was enrolled in the 8th grade at the Intermediate School and prior to that, attended the Deering Elementary School in the 1992-93 school year, and before that attended the Deering Elementary School. Both schools are in the Dawson-Bryant Local School District. (J. Blankenship Depo. 4) 6. Keri Blankenship Keri Blankenship, a student Plaintiff witness, was a seventh grade student at Dawson-Bryant Intermediate School in the 1992-93 school year, and attended kindergarten through sixth grade at the Deering Elementary School in the Dawson-Bryant School District. Keri is a handicapped child and has an Individualized Education Program (I.E.P.). (K. Blankenship Depo. 4-5; 19). 7. Charles Brown Charles Brown is the Assistant Director, Division of School Finance, directing the School Management Assistance section of the Ohio Department of Education. He has held that position since July of 1989. Prior to that, he worked as an area coordinator for the Department from 1987 to July of 1989. Prior to coming to the Department of Education, Mr. Brown served as Superintendent of schools and as a teacher. Mr. Brown received his bachelor of science from Marietta College in 1955 and his masters in 1985 from Ohio University. He did post master's work at Capital University. 8. Gregory Browning Gregory R. Browning is Director, Office of Budget and Management for the State of Ohio. The OBM is a cabinet level agency. He was appointed by Governor George Voinovich. In addition, he is Senior Policy Advisor for Governor Voinovich and, as such, works closely with the Governor and staff in developing and refining policy agenda and initiatives that are important to the Voinovich administration. The Office of Budget and Management is responsible for the financial management of state government. It is specifically required to put forward, biennially, a state budget and capital budget. (Browning Tr. 4360,4390) 9. Charles Buroker Dr. Charles Buroker is the superintendent of the Lima City School District. He has been employed in that position since 1988. Dr. Buroker received his bachelors degree from Bluffton College in mathematics in 1965, his masters in guidance and counseling from Bowling Green State University in 1968, and his doctorate in higher educational administration in 1976. Dr. Buroker has co-authored a number of articles in the field of education, including the development of a strategic planning model, as well as articles dealing with alternative high school models. In addition to his superintendency, he serves on the board of the Northwest Ohio Educational Television Council, the Northwest Ohio Educational Research Council, and committees serving Bluffton College and The Ohio State University educational programs. Prior to assuming the superintendency of the Lima City School District, Dr. Buroker taught mathematics and coached for a number of years. He served as assistant principal at the Franklin Heights High School in the South-Western City School District, and later as superintendent of the Bluffton City School District. In 1983, Dr. Buroker served as superintendent of the Shawnee Local School District in Allen County (a suburb of Lima), prior to his becoming superintendent of the Lima City School District in 1988. (Buroker Tr. 2866-69). 10. Charles Dilbone Charles (Chuck) Dilbone is employed by the Granville Exempted School Board of Education as principal at Granville High School. From 1987-88 through the 1992-93 school year, he was principal at Sheridan High School in the Northern Local School District. He holds a Bachelor of Arts Degree in History from Muskingum College, a Masters in Education Administration from The Ohio State University, and completed course work for a Doctorate in Education Administration at Ohio University. Mr. Dilbone started his professional career at Zanesville High School where he taught history and coached for ten years and then became assistant principal at Zanesville High School for three years before becoming principal at Sheridan High School. (Dilbone Tr. 1984-86) 11. Betty Drummond Betty Drummond is Assistant Director for Standards and Evaluations at the Ohio Department of Education. She has been employed by the Department of Education since 1979, and she has served the Standards and Evaluations Division as both a minimum standards consultant and as Assistant Director. Ms. Drummond holds a bachelor of science degree in elementary education from The Ohio State University and a master's in middle childhood education. In her employment with the Ohio Department of Education, Ms. Drummond was involved with school district evaluations under both the pre-1983 minimum standards and the current 1983 minimum standards. She was also involved in overseeing evaluations under the 1983 minimum standards. Ms. Drummond is currently a member of the committee which is reviewing and revising the 1983 minimum standards. (Drummond Depo. 1-9, 36, 176). 12. James Eaton James Eaton is a member of the Board of Education of the Lima City School District, where he has served for six years. Mr. Eaton is the Assistant Vice President, Manager of Private Banking for the Huntington National Bank in Lima, Ohio. Mr. Eaton graduated from Lima Senior High School and attended The Ohio State University for three years before entering the Air Force in 1964. (Eaton Depo. 4-7) 13 Howard Fleeter Howard Bruce Fleeter is employed by The Ohio State University as an Assistant Professor in the School of Public Policy and Management. He was in his fourth year of that employment during his initial deposition on February 25, 1993. Dr. Fleeter completed his bachelor's degree at Northwestern University in economics and spent six years at Berkeley where he completed his Ph.D in Public Finance in May of 1990. In spring of 1991, a representative of the Governor's office contacted the director of the School of Public Policy with regard to conducting a study of school funding in Ohio. Dr. Fleeter was involved in those discussions which resulted in a proposal for such a study to be submitted and approved. The study, funded by a grant from the Cleveland Foundation, took place over the summer and fall of 1991 and resulted in a written report to the Governor's Education Management Council (Fleeter Depo. Exh. B) submitted in November, 1992. Dr. Fleeter has since been retained by the Department of Education for work on additional projects. (Fleeter Vol. 1, 522) 14. Hazel Flowers Hazel Flowers is the Director of the Ohio Department of Education, Division of Equal Educational Opportunities. She has been employed by the Ohio Department of Education for nineteen years as a consultant, an Assistant Director in the Division of Equal Educational Opportunities, and in her current position. Ms. Flowers holds a bachelor's degree in elementary education from The Ohio State University, a master's in administration and supervision from Xavier University and a Doctorate of Education Administration from Ohio State. Ms. Flower's duties include consulting school districts on race desegregation issues, administration of state and federal programs regarding race and equal educational opportunity, and the administration of Ohio's Effective Schools Program. (Flowers Depo. 6-12, 159). 15. Jimmy Fortune Jimmy Fortune is a professor of research and evaluation at Virginia Tech University where he has been employed for over twenty years. Dr. Fortune obtained his Masters Degree in Education in 1958 from Memphis State and a Doctorate in Education with a minor in statistics from Stanford University in 1964. He has taught classes both in the public schools and at the college level. At Virginia Tech, Dr. Fortune currently teaches qualitative research, regression analysis, intermediate staff, research design, and evaluation design. Dr. Fortune's curriculum vitae is Pl. Exh. 304. (Fortune Tr. 3455-63) 16. Robert Franklin Robert D. Franklin is Building Assistant Supervisor for the Ohio Department of Education. His duties include assisting school districts in obtaining building assistance from the State of Ohio, monitoring the passage of levies, and overseeing construction pursuant to the Building Assistance Program. He holds an undergraduate degree in Industrial Arts, a minor in physical education and a Masters Degree in vocational and industrial administration. Mr. Franklin has had many years of experience in both teaching in the public schools, training foreign workers in the construction trades, and supervising construction projects, both domestic and international. He has taught teachers who are in the process of obtaining their superintendent certificate at Kent State University, Ashland University and Lake Erie College. The courses he teaches pertain to school facilities, including the Building Assistance Program and its operations, eligibility for that program, the condition of school facilities, school safety and funding for construction. (Franklin Depo. 1-24) 17. John Herner John Herner is employed by the Ohio Department of Education as Director of the Division of Special Education and has been since February 1992. (Herner Depo. 42) He obtained a bachelor's degree in elementary education in 1960 and a master's degree in 1962 from The Ohio State University. (Herner Depo. 6) 18. Thomas Hill Thomas J. Hill is a member of the Board of Education of Plaintiff Northern Local School District. Mr. Hill has been a board member for 20 years and is a self-employed real estate salesman. Mr. Hill has been a resident of Glenford, Ohio for 40 years, and he graduated from high school in Glenford in 1953. Mr. Hill has been president of Plaintiff Northern Local School District Board of Education four times. (Hill Depo. 4-6) 19. Douglas Hiscox Douglas Hiscox is presently the Assistant Superintendent at Canfield Local School District in Mahoning County, Ohio. At the time he was deposed, Mr. Hiscox was the Assistant Superintendent at Plaintiff Youngstown City School District, where he was employed since 1991. As Assistant Superintendent of Youngstown City School District, Mr. Hiscox was responsible for supervising the administration and assuring that the Youngstown City School Districts objectives with regard to such matters as philosophy, curriculum and building operations were carried out. Mr. Hiscox visited all of the buildings in the Youngstown City School District on a regular basis. Mr. Hiscox graduated from Heidelberg College in 1977 with a Bachelor of Science in education. He received a Masters Degree in secondary education from Youngstown State University in 1981. Mr. Hiscox received his principal certificate in 1982 and his superintendent certificate in 1986. He at the time of his deposition, he was enrolled in a doctoral program at Youngstown State University. Mr. Hiscox taught science to grades 7-12 from 1977 to 1986 in the Strasburg-Franklin Local School District and the East Palestine City School District. He was the high school principal in the Leetonia Exempted Village School District from 1986 to 1988 and superintendent of Leetonia Exempted Village Schools from 1988 until 1991, when he became assistant superintendent of the Youngstown City Schools. (Hiscox Depo. vol 1, pp. 5-9, 22, 24) 20. Jack Hunter Jack Hunter is supervisor of school facilities with the Ohio Department of Education. He is a licensed electrician, plumber, and Class l boiler operator. (Hunter Depo. 5-9). Jack Hunter has visited over 3,000 educational structures within the State of Ohio, including school buildings, bus garages, stadiums, etc. (Hunter Depo. 33) Jack Hunter is the technical assistant consultant for asbestos abatement for the public schools. (Hunter Depo. 136). Jack Hunter has visited the plaintiff school districts and most buildings within each district. (Hunter Depo. 92-105) 21. Christopher Jackson Christopher Jackson was a senior at the Dawson-Bryant High School in the 1992-93 school year. Chris is a student who loves computers, has had a computer at home since he was five years old, and during his senior year was making a project so that students could get accustomed to a bulletin board system and assisted the teacher in writing a program to assist students on the ninth grade sufficiency test. Christopher wants to attend college and major in computer programming. (Jackson Depo. 5, 17, 19-20). 22. Steve Johnson Steve Johnson is the Superintendent of Plaintiff Northern Local School District; he has been Superintendent for seven years. Mr. Johnson is a graduate of Belmont High School in Dayton, Ohio; he received a Bachelor's of Science in Education from Ohio University in 1966, his Master's Degree in Education in 1970, and is currently enrolled in a doctoral program at Ohio University. Throughout his career in education, Mr. Johnson has served as a coach for football, basketball and baseball, assistant principal, high school principal, athletic director, and principal. (Johnson Tr. 1381-84). 23. Socrates Kolitsos Socrates Kolitsos is a member of the Board of Education of Plaintiff Youngstown City School District, where he has served for twelve years. He has been president of the Youngstown Board of Education. Currently, as a member of the Board, he is the Board of Education liaison to the National School Board Association and the chairman of the Vocational Education Committee. Mr. Kolitsos is a life-long resident of Youngstown. Mr. Kolitsos graduated from Rayen High School in the Youngstown City School District in 1962, and he holds a bachelor of arts degree from Youngstown State University. He has taken additional course work at James Madison University in Washington, D.C., University of Akron and Kent State. He also taught at Rayen and East High Schools in the Youngstown City School District. Mr. Kolitsos is currently employed as Director of Marketing and Operations for Professional Health Services in Lorain, Ohio. (Kolitsos Depo. 4-8, 16-17). 24. Marie Lichtenstein Marie Lichtenstein is a first-grade teacher at Plaintiff Southern Local School District. Ms. Lichtenstein has been a teacher at Southern Local for 16 years. Additionally, Ms. Lichtenstein is a Chapter One teacher and a reading recovery teacher. Ms. Lichtenstein is also a member of Plaintiff Southern Local School District's Language Curriculum Development Committee. (Lichtenstein Depo. 4-5, 15). 25. Dewey Lykins Dewey Lykins is employed as the Administrative Assistant in the Scioto County Office of Education. Mr. Lykins holds a bachelor's degree from the University of Rio Grande and a master's degree from Marshall University. He has been employed in the field of education in Ohio as a teacher, elementary school principal, high school principal and superintendent. Immediately preceding his employment with the Scioto County Office of Education, Mr. Lykins was Director of the Appalachian Access and Success Project, which is a grant project funded by the Ohio Board of Regents to examine the factors leading to the low levels of participation of Ohio's appalachian students in higher education. The Appalachian Access and Success Project generated a written report of its findings entitled "Appalachian Access and Success." (Lykins Tr. 2287-91) 26. Carol Marino Carol Ann Marino has been employed by the Youngstown Board of Education since 1969 and is currently an administrator in the area of curriculum and instruction. Dr. Marino graduated from Chaney High School in the Youngstown City School District and obtained a Bachelor's Degree in Science and Education in 1969 and a Master's Degree in Science Education with a Reading Supervisor's K-12 certification in 1974, both from Youngstown State University, and a Ph.D in Curriculum and Instruction from the University of Akron in 1987. Dr. Marino taught in the regular classroom and in Chapter I programs and served as Elementary Supervisor beginning in 1979 for eight years, as Director of Personnel for two years, and as Director of Instruction for four years through the 1992-93 school year. Currently, she is the coordinator for the Upper Elementary Learning Centers. Dr. Marino published an article on minimum competencies in The Ohio Reading Teacher, and she had responsibility for implementation of the 1983 minimum standards as Elementary Supervisor from 1979 to 1987. (Marino Tr. 3170-74) 27. Richard Maxwell Richard Maxwell is presently employed by the Buckeye Association of School Administrators as a school finance consultant. He has held that position since April of 1993. Mr. Maxwell has served 31 years in public education, most recently as the Superintendent of the Holmes County Board of Education where he served from 1981 to 1993. Previous to that, he served as the superintendent of the West Holmes Local School District in Holmes County where he served from 1970 to 1981. Prior to his administrative work, Mr. Maxwell taught in a number of school districts in Ohio. Mr. Maxwell completed his Master of Arts in Education work in 1968 at the University of Akron. His graduate advisor was Oliver Ocasek who is presently the President of the State Board of Education. Mr. Maxwell has had extensive involvement in issues regarding the funding of public education in Ohio, having taught school finance and school facilities at Ashland University since 1982. He has also lectured extensively for the State Department of Education on school finance issues. He has also published a school finance newsletter. (Maxwell Tr. 48-51; curriculum vitae is Pl. Exh. 1) 28. Benjamin McGee Benjamin L. McGee is the Director of Pupil Personnel Services at the Youngstown City Schools and is responsible for special education programs, school health services, school attendance services, student accounting and maintenance, at-risk programming, and other areas. Mr. McGee graduated from South High School in Youngstown and obtained a bachelor's degree in education from The Ohio State University in 1972, and a master's degree in education administration from Youngstown State University in 1979, and is presently pursuing a doctorate in educational leadership. Mr. McGee's entire educational career has been at the Youngstown City Schools beginning in 1972. He taught classes, served as school social worker for four years, and served in various principal positions before serving as Supervisor of Special Education Programs and then as Director of Pupil Personnel Services. (McGee Depo. 4-7) 29. Lee McMurrin Lee McMurrin is the Superintendent of the Beachwood City Schools in Beachwood Ohio. At the time of his testimony, Dr. McMurrin was in his seventh year in that position having previously served as Superintendent of the Milwaukee City Schools in Milwaukee, Wisconsin for slightly more than 12 years. Prior to that, he served as a deputy superintendent of the Toledo City Schools for ten years and previous to that he served as an administrator in the South-Western City Schools in Franklin County, Ohio. Dr. McMurrin, at the time of his testimony, had completed 43 years of service in public education as a teacher and administrator. (McMurrin Tr. 2494-96) 30. John Kenneth Miller John Kenneth (Ken) Miller is a member of the Board of Education of Plaintiff Northern Local School District, where he has served for six years. Mr. Miller also served a two year term as president of the Northern Local Board of Education. Mr. Miller is a self-employed farmer, and he has been in the agribusiness industry for 22 years. He graduated from Sheridan High School in the Northern Local School District in 1970 and entered the agribusiness industry the following year. Mr. Miller currently operates a cash grain operation that involved corn, soybeans and wheat covering over 2,100 acres. In addition, he runs a seed business, where he is solely responsible for all invoicing, sales, inventory control, purchasing and ordering. In addition to his businesses, Mr. Miller is a member of the board of the Federal Land Bank and is involved with the Production Credit Association and the Somerset Bank. Mr. Miller employs computer, accounting and financial skills in his professions. Mr. Miller has three children who have attended or currently attend school in the Northern Local School District: J.B., who graduated from Sheridan High School in 1992, Jodi, who is a junior at Sheridan High School, and Jessie, who is in the sixth grade in a modular unit at the high school/junior high school complex. (Miller Tr. 1602-08) 31. Roger Miller Roger L. Miller is the Assistant Superintendent for Pupil Personnel at the Lima City Schools. He is responsible for the entire student discipline program, attendance, special education supervisors, and administrative staff in special education. He is also the hearing officer for student discipline appeals. Mr. Miller is a graduate of Lima Senior High School and obtained a Bachelor's Degree in Elementary Education in 1968 and a Master's Degree in Guidance and Counseling in 1971. Mr. Miller's entire career in education has been with the Lima City Schools, beginning in 1968 teaching junior high special education, and later serving as Associate Principal from 1978 to 1982 and Principal at Lima Senior from 1982 until August 1991, when he became Assistant Superintendent for Pupil Personnel. (Roger Miller Depo. 4-6; 13-16) 32. Cheryl O'Connor Cheryl O'Connor is the guidance counselor for the senior class at Lima High School in Plaintiff Lima City School District. She has been employed for eighteen years by the Lima City School District, and has served in her current position for eight of those years. Prior to becoming senior guidance counselor, Ms. O'Connor taught academic and vocational business. Ms. O'Connor holds a bachelor's degree in comprehensive business education from the University of Toledo and master's degrees in guidance, counseling, and educational administration from the University of Dayton. She holds a permanent teaching certificate, a four year provisional supervisory certificate, a four year provisional administrative certificate and an eight year professional guidance certificate. (O'Connor Tr. 3096-98) 33. Oliver Ocasek Oliver Ocasek is President of the State Board of Education of Ohio, on which there are 11 members. Prior to his election to the State Board of Education, President Ocasek served for 28 years in the Ohio Senate. During his tenure in the General Assembly, he served six years as Leader of the Ohio Senate, and also served as Chairman of the Senate Education Committee. While in the Ohio Senate, President Ocasek considered himself to be an advocate of funding for public education. President Ocasek has a Bachelors and Masters degree in education, and has completed his hours for a PX.D at Case Western Reserve University. In addition, President Ocasek taught high school, and also was principal of Tallmadge High School. He is the recipient of seven honorary doctorate degrees. In addition, for 32 years President Ocasek taught school finance, school law and school construction at the University of Akron. Since becoming a member of the State Board of Education, President Ocasek has visited 62 school districts. (Ocasek Tr. 2777-83, 2786) 34. Peggy Papritan Peggy Lynn Papritan has been the principal at Glenford Elementary in the Northern Local Schools for seven years. Ms. Papritan obtained a Bachelor's Degree in Elementary Education in 1975 and a Master's Degree in Curriculum Supervision, with a concentration in children's literature and writing in 1983, both from The Ohio State University. She holds certifications in elementary education, gifted education, K-12 curriculum,supervision K-12, and elementary principal. She began her career in education as a Title I (now Chapter I) reading teacher at Lancaster City Schools, taught language arts in the Southwest Licking Local Schools, and was enrichment coordinator at the Granville Exempted Village Schools. She is a member of various professional organizations and has served in leadership positions of those organizations. (Papritan Tr. 1913-15) 35. Jimmy J. Payton Dr. Jimmy J. Payton is the Assistant Director of the Policy Research and Analysis Office at the Ohio Department of Education (ODE), and is the most senior member of the Simulation Unit within that office. (Payton Tr. 4882-83; 4911) Dr. Payton received a Bachelor's Degree from Otterbein College in 1969, a Master's Degree in Economics in 1971, and a Ph.D. in Educational Research and Development with a concentration in School Administration and School Finance in 1980 both from The Ohio State University. (Payton Tr. 4881) Dr. Payton was employed from 1971-73 at the Ohio Department of Taxation as a Tax Economist. For two to three years in the late 1970s, Dr. Payton was a consultant with the Education Review Committee of the Ohio General Assembly and worked on developing different approaches to improving the school finance formula and analyzing the results of different proposals regarding an income factor and a cost of doing business factor for school funding. (Payton Tr. 4881; Payton Depo. 10) From 1977 to 1981, Dr. Payton was employed by ODE as director of the State-Wide Student Needs Assessment Program. (Payton Tr. 4881-82) Since October 1989, Dr. Payton has been employed by ODE as a Research Consultant. (Payton Depo. 13) Dr. Payton's current responsibilities include school finance research, simulations of proposed legislation relating to school finance and school finance reform in the state legislature, and simulations of various proposals that Dr. Ted Sanders, members of the state board, and school superintendents may request. Dr. Payton also assists in formulating the State Board of Education's budget requests and does simulations of various budget proposals for the legislature. (Payton Tr. 4832-83) 36. William Phillis William Phillis is presently employed as an adjunct professor of school finance and school administration at Ashland University. He is also employed as the Executive Director of the Ohio Coalition for Equity and Adequacy of School Funding, an organization of some 500 Ohio school districts supporting reform in school funding. Prior to assuming his position with the Coalition, Dr. Phillis served as Assistant Superintendent of Public Instruction from August 2, 1976 to April 13, 1992. In that capacity, he was responsible for a wide range of duties including responsibility for administration of the Classroom Facilities Act and served as liaison to the Ohio General Assembly and the State Board of Education. As Assistant Superintendent of Public Instruction, Dr. Phillis was in contact with virtually every city, local, exempted village, and joint vocational school district in the state. His contact included both telephone communications as well as travel to the districts. During the 16 year period, he traveled nearly 1/2 million miles to various school districts in the state. (Phillis Tr. 1667-68) Dr. Phillis has served a total of 36 years in public education including service as a teacher and later principal at the Southeastern High School in Ross County, Superintendent of the Minford local School District in Scioto County, County Superintendent for Columbiana County and later, Superintendent of the Joint Vocational School as well. In addition to his service to public education, Dr. Phillis serves as vice-chair of the Board of Trustees of the Ohio Valley College in Parkersburg, West Virginia, a member of the Board of Trustees of the Midwestern Children's Home, and as President of the Board of Fort Hill Christian Youth Camp in southern Ohio. Dr. Phillis is the recipient of numerous honors and awards including commendations from both the Ohio House of Representatives and Ohio Senate. (Phillis Tr. 1654-68) 37. Edna Pincham Edna Pincham is Vice President of the Board of Education of the Youngstown City School District, where she has served since 1984. She has also served as Board President. Ms. Pincham holds an associate's degree from Youngstown State University. Ms. Pincham is currently employed as Assistant to the Mayor of Youngstown, a position she has held for eight years. She has also been Vice President of the Ohio PTA. (Pincham Depo. 4-13, 56). 38. William Pletcher William Pletcher is a freshman at The Ohio State University. He graduated in June of 1993 from Cardington-Lincoin High School in the Cardington-Lincoin Local School District in Cardington, Ohio. Both Mr. Pletcher and the Cardington-Lincoln Local School District are named plaintiffs in the suit captioned Thompson. et al v. State of Ohio. et al., Case No. C2-91-464, now pending before Judge Holschuh in the United States District Court for the Southern District of Ohio, Eastern Division. (Pletcher Tr. 263335) 39. Tod Porter Tod Porter is an Associate Professor of Economics at Youngstown State University. He holds both a Ph.D. and Masters in economics from Syracuse University with emphasis in both labor economics and public finance. He has been teaching at Youngstown State since 1984 and his course work includes both graduate courses as well as statistics and principles courses. (Porter Tr. 1049-53) Dr. Porter first became interested in school finance when he did a study of the effects of steel mill closings for the Youngstown City Schools in 1988. That study led to additional analysis of school funding on a statewide basis beginning in 1990. (Porter Tr. 1054-55; Resume is Pl. Exh. ga) 40. David Roach Dr. David Roach is employed by the Washington County Board of Education which serves as fiscal agent for the SEOSERRC (Southeast Ohio Special Education Regional Resource Center). Dr. Roach serves as the Director of SEOSERRC and has served in that capacity since 1985. He holds a Bachelor of Arts, Masters of Science and Ph.D degrees from Ohio University. His Doctorate is in the field of educational administration. In addition to his duties as SERRC director, Dr. Roach also teaches special education at Ohio University and has been a regular participant in workshops on issues related to special education. The SEOSERRC is one of 16 statewide regional resource centers, each of which is an agency of the State Department of Education but is governed by a regional board of governors. The SERRC is charged, generally, with the responsibility to provide assessment services to handicapped children, to provide inservice and training seminars in the area of special education, to coordinate the provision of multi-district special education programs, to assist in the evaluation of school district programs for compliance with state and federal program requirements, and to provide assistance to school districts by making available a limited materials library. The SEOSERRC, in addition to Dr. Roach, employs 14 staff members, including eight professionals and six non-certified employees. (Roach Tr. 2666-74; Resume is Pl. Exh. 249) 41. Warren Russell Warren Russell is the Director of Governmental Affairs for the Ohio Department of Education. He hag been employed in that capacity since July 6, 1992. Prior to the most recent employment with the Department of Education Mr. Russell was employed by the Jostens Corp. as Director of Governmental Relations in a division of the corporation that dealt with the development and sale of educational software. In that capacity, he served a 12 state region including Ohio. The software that his division marketed was directed to public and private elementary and secondary schools. From 1982 to 1990, Mr. Russell was Director of Legislative Services and Labor Relations for the Buckeye Association of School Administrators, and Ohio organization representing public school superintendents. The Buckeye Association of School Administrators (BASA) is a state affiliate of the American Association of School Administrators. In that position, Mr. Russell was responsible for monitoring and reporting on the progress of legislation dealing with the funding of public schools in Ohio. In the course of that employment, he visited at least half of the 612 public school districts in Ohio. He was also responsible for the presentation of seminars dealing with various aspects of collective bargaining as that process affected school districts in Ohio. Mr. Russell was first employed by the Ohio Department of Education during the period from 1978 to 1982 when he served as a Legislative Liaison, Policy Analyst. In that position, he reported to William L. Phillis, another witness in this case. In that capacity, Mr. Russell was responsible for assisting Dr. Phillis in representing the Department of Education in the legislature. He was also responsible for the information simulation system operated by the Ohio Department of Education. In that capacity, Mr. Russell participated in the development of two biennial education budgets. Prior to joining the Ohio Department of Education, Mr. Russell taught in various public school districts having completed his Bachelor's of Science degree from Bowling Green State University in 1969 and his Master's of Arts Degree in psychology in 1972. Mr. Russell also undertook postgraduate work at Bowling Green following the award of his Master's Degree. (Russell Depo. 5-35) 42. John Theodore (Ted) Sanders Dr. Sanders became Superintendent of Public Instruction for the State of Ohio on October 1, 1991. He came to Ohio from a position as Under-Secretary of Education for the United States Department of Education where he reported directly to the Secretary of Education. As Under-Secretary of Education he was responsible for the day-to-day operations of the United States Department of Education Before assuming responsibilities for the U.S. Department of Education, Dr. Sanders served as Superintendent of Public Instruction for the State of Illinois, and prior to that, for the State of Nevada (1979 to 1985). Before his state administrative service, Dr. Sanders taught in various public schools and served as Assistant Superintendent for Administration for the State of New Mexico. (Sanders Tr. 274-82) 43. Colleen Sexton Colleen Marie Athens Sexton is an Assistant Professor in Curriculum and Instruction at Ohio University in Athens, Ohio, where she teaches science education to future and practicing science teachers. She obtained a degree in biology from Quincy College (Illinois) in 1976; a Master's in Ecology and Conservation from Governor's State University (Illinois) in 1980; and a Ph.D. in Science Education from Ohio University in 1991. She began her teaching career in 1977 as a teacher of high school science. In addition to her duties at Ohio University, she is the Curriculum Director of the Appalachian Distance Learning Project. Dr. Sexton is a member of a number of professional organizations and honorary societies, and has published a number of articles including a recent textbook called "Teaching Science for All Children." Following the publication of "New Dimensions in Science Education," an Ohio Department of Education (ODE) guide for school districts' science curriculum, Dr. Sexton was employed by the ODE to present workshops regarding that publication. In October 1993, Dr. Sexton made a presentation regarding distance learning and read and evaluated technology grants at the request of the ODE. (Sexton Tr. 846-60; 866-68; Resume is Pl. Exh. 93) 44. Kathleen Schindler Kathleen Schindler has been employed by the Ohio Department of Education since 1980 and is currently the Assistant Director of the Division of Special Education. Ms. Schindler obtained a bachelor's degree in speech and hearing therapy from Bowling Green State University in 1964 and a master's degree in guidance and counseling from The Ohio State University in 1977. Ten educational consultants and six support staff report to her, and she reports to Mr. John Herner. (Schindler Depo. 5-7; 9-10) 45. Frank Schiraldi Frank Schiraldi has been employed by the Ohio Department of Education since 1978. He is currently Assistant Director of the Division of Curriculum, Instruction, and Professional Development. Dr. Schiraldi obtained a Bachelor of Arts degree in History from Youngstown University in 1965, a Master of Arts degree in Political Science from Kent State University in 1972, and a Ph.D. from The Ohio State University in Educational Theory and Practice in 1988. Dr. Schiraldi is a member of the Ohio Department of Education Technology Task Force, and authored portions of the State Board of Education's Plan for Technology. Dr. Schiraldi testified before the Court and his deposition taken by Plaintiffs was properly submitted as evidence. (Schiraldi Tr. 5032-33; 5035; Schiraldi Depo. 146) 46. Mark Semanco Mark Semanco is a Plaintiff teacher employed by the Dawson- Bryant Local School District where he has taught high school science since the 1981-82 school year. He obtained a Bachelor's Degree in Biological and General Sciences from Marshall University in Huntington, West Virginia in 1980 and a Master's Degree in Biological Science from the same university in 1981. Mr. Semanco has taken post-graduate work in education administration and is certified to teach grades 7 through 12 in chemistry, biology, and general science. (Semanco Depo. 4-6) 47. Michael Shoemaker Michael C. Shoemaker is a State Representative from the 91st District, which includes half of Pickaway County, all of Ross County and all of Vinton County. Representative Shoemaker taught high school level classes at Paint Valley High School, Chillicothe High School, and Unioto High School, and he has held certification for grades 7-12 in mathematics, science, physical education and health. In the field of education, Representative Shoemaker has held the positions of football coach, track coach, basketball coach and athletic director Representative Shoemaker was first elected to the Ohio House of Representatives to represent the 88th District in November of 1982. He has served on the Health & Retirement Committee, the Education Committee, the Public Utilities Committee, the Finance & Appropriations Committee, and the Veteran Affairs Committee. Representative Shoemaker is currently chairman of the Finance & Appropriations Committee. Representative Shoemaker has also served on select committees, including the Public Testing and Competency Committee, the State Medical Board Committee, the Health Maintenance Organization Study Committee, the Select Committee to Review and Study Ohio's Education System and the Correctional Institution Inspection Committee. Representative Shoemaker has chaired the Select Committee to Review and Study Ohio's Education System, and he spends between 65-75 percent of his time as a legislator on education. (Shoemaker Tr. 4049-57; curriculum vitae is Pl. Exh. 308) 48. Carol Spangler Carol Spangler is the Superintendent of the Southern Local School District in Perry County. In 1975, she received a Bachelor of Arts degree from Marshall University in the field of education and speech therapy. In 1976 she received a Master's degree in speech pathology and audiology from the same university. She has taken courses at Loyola College in Baltimore, Maryland, in the field of curriculum and supervision and child language and additional course work in curriculum and supervision at Ohio University. She has entered a doctoral program in educational administration at Ohio University, where she has completed course work in school finance, school law, educational administration, curriculum development, curriculum supervision, curriculum change in educational philosophy and history pertaining to curriculum. She has authored student publications as well as two nationwide publications, one for professionals working in the field of speech and language disorders and another regarding curriculum. Carol is a member of two educational honorary societies, belongs to the Association for Supervision of Curriculum Development, is chairperson of the local Educational Media Research Center, and is Vice-Chairman of SEOVEC, a computer consortium that operates shared computer services to school districts and operates as the district's A-site for the state's Education Management Information System (EMIS). She holds an Ohio Superintendent's Certificate, an Ohio Assistant Superintendent's Certificate, an Educational Specialist's Certificate in the area of Special Education or Exceptional Child, and a professional certificate in the area of speech and hearing therapy. Ms. Spangler's professional employment began in the area of special education working with speech disordered children in Annapolis, Maryland from 1976 to 1978. She then returned to Ohio and served one year as a speech/language supervisor for Southeastern Ohio Regional Resource Center (SEORRC). In 1979-80, she served as a speech language pathologist for Meigs County School District. Then at the Federal Hocking Local School District, she held several positions over a number of years, beginning as a speech language pathologist and moving to directing and supervising budgets of the district's special education programs. Around 1985, she became director of curriculum at Federal Hocking and served in that capacity for about five years. As director of curriculum, she was responsible for implementing the 1983 minimum standards, including developing many new courses of study, implementing a competency based testing program, and providing staff development. In 1990-91, she served as middle school principal at Federal Hocking, and she became Superintendent at Southern Local in August 1991. (Spangler Tr. 420-29) Upon becoming Superintendent at Southern Local Schools in 1991, Ms. Spangler undertook a variety of duties, including chief executive officer for the board of education, chief manager of operations such as transportation, food services, personnel, budget development, finance issues, finance monitoring and financial planning, and serving as the district's purchasing agent, reviewing each purchase order. Superintendent Spangler is involved with and makes presentations for staff development. She is responsible for development, monitoring, and compliance for state and federal projects, and she performs grant writing for the district. A major responsibility has been the restructuring of the school district. (Spangler Tr. 429-33) 49. Phyllis Spohn Phyllis Spohn is a second-grade teacher at Plaintiff Northern Local School District, where she has been employed for 23 years. In her 23 years of teaching at Plaintiff Northern Local School District, Ms. Spohn has been a teacher's aide, she has taught 1st, 2nd, 3rd, 4th and 5th grades, and she has taught gifted students in grades 3 through 6. She has taught her entire 23 years at the Glenford Elementary School in Plaintiff Northern Local School District. Ms. Spohn received her bachelor's degree in Elementary Education from Ohio State University, and she is certified in grades 1 through 8 and gifted education. (Spohn Depo. 4-6) 50. Carl Swartzwelder Carl Swartzwelder is a member of the Board of Education of Plaintiff Dawson-Bryant Local School District. Mr. Swartzwelder has been on the Board of Education for four years. Mr. Swartzwelder is also on the Dawson-Bryant Local School District Athletic Board. (Swartzwelder Depo. 6) 51. Susan Tavakolian Susan Tavakolian has been employed by the Ohio Department of Education since January of 1984. She currently holds the position of Director of School Finance, having been appointed to that position when Dr. James Van Keuren was promoted to Assistant Superintendent of Public Instruction. Prior to becoming Director of School Finance, Dr. Tavakolian served as legislative liaison between the Department of Education and the legislature. From 1985 to 1989, Dr. Tavakolian was in charge of the Department of Education's simulation unit and took an active role in the development of the Department's state budget proposals. As legislative liaison, she continued to be involved in the budget process but assumed additional responsibilities for other Department of Education legislative positions as well. She reported to William L. Phillis prior to his leaving the department. Dr. Tavakolian holds a Ph.D from the University of Massachusetts and a Masters Degree in public administration from The Ohio State University. (Tavakolian Depo. 5-17) 52. Kenneth Taylor Kenneth Taylor is employed by the Ohio Department of Education as an "Area Coordinator." Mr. Taylor reports to Ray Cook, who reports to Dr. Susan Tavakolian in the Division of School Finance. (Taylor Depo. 52). There are nine Area Coordinators' offices in the state, and two Area Coordinators are generally assigned to each office, but not all positions are filled. (Taylor Depo. 17) Mr. Taylor's office serves Area 5, consisting of Galia, Lawrence, Jackson, Scioto, Pike, Ross, Pickaway, Fayette, Highland, Adams and Brown Counties. The area would be considered an economically depressed area, with very few jobs. Many people leave the area to find employment elsewhere. (Taylor Depo. 51). Mr. Taylor has been employed in that position and has served basically those same counties since 1977. He knows the superintendent and the treasurer in each of the school districts in Area 5 to varying degrees. (Taylor Depo. 16). Mr. Taylor's duties include consulting with superintendents on school finance issues, collecting subsidy data for the School Foundation Program, school transportation work, and some driver's education work. (Taylor Depo. 14) Mr. Taylor received a Bachelor's Degree in Agriculture from The Ohio State University, an Education Degree from Rio Grande College with an emphasis in math and science, a Master's Degree in Education Administration from Xavier University, and currently holds a superintendent's certificate. From 1972 to 1977, Kenneth Taylor was employed by the Department of Education as an education consultant, and he read and approved Title 1 projects from approximately 60 school districts scattered across the state. Title 1 was a program of compensatory education for educationally disadvantaged students that has now become the Chapter 1 program. (Taylor Depo. 8-11) 53. Christopher Thompson Christopher Joel Thompson is a Plaintiff Student and a sophomore at Miller High School in the Southern Local School District. (Thompson Tr. 1306-07). Chris was born in 1978, began his first formal schooling at the kindergarten level in 1984, and has attended Southern Local Schools continuously since that date. Chris has attended every school building that has been operated by the Southern Local School District since 1984, except for Moxahala Elementary and the new elementary and middle school facilities opened in the fall of 1993. Chris plans to attend college and would like to study genetics and engineering, with a minor in computer engineering or computer programming. (Thompson Tr. 1352-53) 54. Sue Tobin Susan Gail Tobin is an attorney employed by the Ohio Legal Rights Service (OLRS) and has been since 1981. OLRS is a state agency that receives state and federal funds to protect and advocate the rights of persons who are, or alleged to be, mentally ill, developmentally disabled, or mentally retarded. Ms. Tobin obtained a bachelor's degree from Kenyon College in 1978 and a juris doctorate from The Ohio State University College of Law in 1981. (Tobin Depo. 6; 12-13; Resume is Tobin Depo. Exh. 1) 55. Robert Towner Robert Towner is Athletic Director at Miller High School in Southern Local School District, and Principal of the Middle School. He is a graduate of Corning High School and received a Bachelor's Degree in Education from Ohio University in 1964. In 1971, he obtained a Master's Degree in Secondary School Administration from Ohio University. He is a holder of a Principal's Certificate, for grades 5-12. He has worked in Southern Local School District since 1964, teaching sixth grade, as well as health and physical education in the high school. He has served as assistant basketball coach as well as head varsity basketball coach, and has been Athletic Director since 1976. (Towner Tr. 819-21) 56. James Van Keuren James Van Keuren is employed by the Ohio Department of Education as an Assistant Superintendent of Public Instruction. He received his Bachelor's degree from Olivet College, his masters in education administration from Bowling Green State University, an EDS degree from Kent State University, and a doctorate in educational administration from Akron University. Dr. Van Keuren taught in the Waynesfield Goshen Local School District, served as junior high school principal at the Oberlin City Schools, high school principal at the Ledgemont Local Schools, and later as Superintendent of that district. He also served one year as superintendent of the Rolling Hills Local School District before coming to the Department of Education. Dr. Van Keuren began his work with the Ohio Department of Education in June of 1983 as director of the Division of School Finance. He continued in that capacity until April of 1992 when he became Assistant Superintendent for finance and administration. (Van Keuren Tr. 4632-42) 57. Donald Washburn Donald Washburn is a Plaintiff Superintendent from Dawson- Bryant Local School District (Dawson-Bryant). Mr. Washburn obtained a Bachelor's Degree in 1970 and a Master's Degree in Adult and Continuing Education with an emphasis in counseling from Moorehead State University and has taken post-graduate work at Ohio University. He holds superintendents' certifications and adult vocational director's certification and has held a variety of teaching certificates. (Washburn Tr. 2305-06) Mr. Washburn's first employment as an educator was at Rock Hill Local Schools in 1970 as a special education teacher. He was employed as Lawrence County Career Development Coordinator for two years, and then was Deering Elementary Principal at Dawson-Bryant Local from 1981 to 1988. From 1988 to 1990, Mr. Washburn was supervisor of curriculum and federal programs for Dawson-Bryant, and following two years of employment at the PLASCO-Ross SERRC, became Dawson-Bryant Superintendent in August 1992. Mr. Washburn has worked with the Ohio University southern campus in developing workshops and in-service programs for teachers, and since 1990 he has taught classes for Ohio University. (Washburn Tr. 2314-26) Mr. Washburn is a member of several governing boards and is serving or has served on five committees to which he was appointed by a representative of the Ohio Department of Education (ODE); two committees dealt with teacher in-service, the other two dealt with revision of state regulation of special education, and the fifth was the Learners Outcome Panel, that was charged with restructuring all elementary and secondary standards for education in Ohio. In 1989, Mr. Washburn was recognized as the outstanding visionary in the state of Ohio by the ODE. (Washburn Tr. 2306-14) 58. Wayne White Wayne White was Superintendent of Plaintiff Dawson-Bryant Local School District from 1982 until 1992. Presently he is director of the Ohio Appalachian Center for Higher Education. He received his undergraduate degree in elementary education from Ohio University, and in 1971 obtained his Masters Degree in Education from Moorehead State University. He is the holder of a permanent Superintendent's certificate. Mr. White taught history, American government, physical education and health at the high school level. He also coached high school basketball. He serves on numerous boards, including bank and hospital boards. Mr. White also served on the Ohio Department of Education Committee on Kindergarten. (White Tr. 2053, 2064-70) 59. Jane Wiechel Jane Wiechel is Director of the Early Childhood Education Division of the Ohio Department of Education. The Division of Early Childhood Education is responsible for screening and assessing needs of young children, pre-school education, and school-age child care. The Division of Early Childhood Education is primarily involved with five areas, including: pre-school special education; public pre-school; Head Start; school-age child care; and screening and assessing needs of young children. (Wiechel Depo. 18-19) 60. Joseph Winnenberg Joseph R. Winnenberg is a high school teacher at Southern Local School District, in Miller High School. He teaches senior English, senior English-College Prep., humanities, personal computing, and desk-top publishing. Mr. Winnenberg taught at Logan City School District, and New Lexington High School before he started teaching at Miller High School in 1983. He has variously coached football, basketball and track in the Logan City School District and New Lexington High School, and has also coached high school football in the Southern Local School District. Mr. Winnenberg belongs to the National Council of Teachers of English, and has served on the Advisory Board to Educational Technology Services, which provides educational TV and computing services to the public school in southeastern Ohio. He taught at Hocking Technical College as a computer instructor, and has provided consulting services to numerous businesses in town and to career education. (Joe Winnenberg Tr. 741-45) 61. John Winnenberg John Winnenberg is a member of the Board of Education of Plaintiff Southern Local School District, where he has served since 1978. He has been president and vice president of the board on several occasions. Aside from his duties as a Board member, Mr. Winnenberg volunteers at the Millcreek Elementary School one morning a week. After Mr. Winnenberg graduated from Miller High School in the Southern Local School District, he received a bachelor's degree in elementary and secondary education from Bowling Green State University. He has been certified to teach in the areas of special education and elementary education. After receiving his degree from Bowling Green, Mr. Winnenberg returned to Perry County to teach seventh grade at the New Straitsville Elementary School in the Southern Local School District for one year. Mr. Winnenberg was born and raised in Southern Perry County, and he has resided there all but five years of his life. Mr. Winnenberg's daughter Emily is a second grade student at Millcreek Elementary in the Southern Local School District. Mr. Winnenberg is heavily involved in the Southern Perry County community. He is a member of the Citizens for Southern Local group, which is active in school district improvement issues. He is also involved in the Tecumseh Theater Restoration and the Shawnee Historical Preservation groups, which are involved in restoring the buildings in downtown Shawnee, Ohio. Mr. Winnenberg has been on the Perry County Library Board since 1976, and he publishes a local newspaper called "Community Life News." (John Winnenberg Tr. 1223-28) III. THE ENTITLEMENT TO ELEMENTARY AND SECONDARY PUBLIC EDUCATION IN OHIO AND THE ADMITTED INEQUITIES IN THE PROVISION OF ENTITLED EDUCATIONAL SERVICES 1. It is the responsibility of the state of Ohio to provide school districts with adequate resources that are equitably and reliably distributed. (Sanders Tr. 4552; Ocasek Tr. 2792) 2. It is the position of the State Board of Education that all children in Ohio should have access to equitable educational opportunities. (Phillis Tr. 1741) 3. By statute, the State Board of Education is charged with the responsibility of providing the system of public education throughout the state. This responsibility includes providing the most effective and highest quality education. (Ocasek Tr. 2788) 4. The State Board of Education and the Ohio Department of Education have communicated to the Ohio General Assembly that the current level of funding for public education in Ohio is neither equitable nor adequate. (Phillis Tr. 1797-9 a ) 5. The mission statement of the Ohio State Board of Education is: The mission of education is to prepare students of all ages to meet, to the best of their abilities, the academic, social, civic and employment needs of the 21st century by providing high quality programs that emphasize the life-long skills necessary to continue learning, communicate clearly, solve problems, use information and technology effectively, and enjoy productive employment. (Pl. Exh. 10, p. ii) 6. The State Board of Education has recognized that in the 1990s, the State of Ohio needs to restructure school funding, realign our resources to allow for greater flexibility at the district and building levels, and continue modernizing our vocational educational system to reflect the needs of a dynamic workplace. (Pl. Exh. 10, p. 10 ) 7. As part of a strategic plan for education in the 1990s, the Ohio State Board of Education set a goal of re-structuring the state school funding system, noting that successful school reform requires a funding system that truly equalizes the educational opportunities for all students. (Pl. Exh. 10, p. 16) 8. The State Board of Education has recognized the state's obligation to provide a high quality educational program for all pupils in the state. Plaintiff's Exhibit 140 is the State Board's Budget and Policy Recommendations to the Governor and the 119th General Assembly. That document recognized the constitutional responsibility of the State of Ohio, and further pointed out five weaknesses in the state funding formula, which are as follows: (Phillis Tr. 1736-39; Pl. Exh. 140) a. The level of basic aid provided through the school foundation program does not approach the average expenditure per pupil in Ohio. In 1980, basic aid represented 59 percent of the average expenditure, in 1989, the gap had grown to 70 percent. The average expenditure per pupil is out-pacing the foundation level at an increasing rate. (Pl. Exh. 140) b. Categorical funds are not equalized. Wealthy districts receive the same unit funding for vocational and special education as poor districts. Poor districts have less ability to pay the difference in the cost of those programs between state funding and the actual program cost. (Pl. Exh. 140) c. The operation of a guarantee provision diminishes the equalization effects of the foundation program. (Pl. Exh. 140; Ocasek Tr. 2843; see also Defense Opening Statement, Tr. 27) d. The present charge-off does not accurately measure the ability of districts to pay the local share of the foundation program. (Pl. Exh. 140) e. Only small effort is given to the funding of capital improvements from the state level. (Pl. Exh. 140) 9. Ohio State Board of Education President Oliver Ocasek has stated publicly that he hopes the Plaintiffs win the instant case. Further, he informed the State Board of Education at its October, 1993 meeting that if the price of the State of Ohio winning the case was that he would have to testify that funding was adequate, that there was equity, and mills were equal, then he could not so testify and would just as soon lose the case. 10. The General Assembly has not appropriated sufficient funds to alleviate disparities between school districts. Equalization is not occurring as it should. The system is failing at the extremes, for the rich and for the poor. (Ocasek Tr. 2842) 11. The extent of disparity in school district expenditures between school districts in Ohio ranks our state as one of the most disparate states in the nation. (Russell Depo. 177; see also Alexander Tr. 3728) 12. Superintendent Sanders has conceded the disparities in funding to school districts is not morally right. (Sanders Tr. 415, 4556) 13. State Superintendent Sanders has informed the State Board of Education, "I do know that the state's system of school finance is not morally right. . . the disparity between high-spending and low-spending districts is too wide. . . classrooms in some districts are not equipped with appropriate instructional materials and equipment; many teachers use their personal funds to purchase supplies for their classrooms; the state still raises the majority of its resources for education through the property tax; the system has not responded to the categorical problems changing demographics of communities, families, and children; and categorical problems limit local communities' and schools' flexibility to address the underlying problems and needs of students." (Pl. Exh. 40, p. 5) 14. Defendants have admitted that the current system of funding public elementary and secondary education in Ohio is in need of reform. State Superintendent Sanders and the State Board of Education have communicated to the Ohio General Assembly the belief that "If every learner is to have access to the educational opportunities that will achieve the results we require as a state, we will need to comprehensively reform our school finance system." (Defense Opening Statement, Tr. 42; Sanders Tr. 348; Pl. Exh. 15 p.l) 15. Defendants have admitted that Ohio's educational system has become obsolete and cannot fully respond to the challenges our state will meet in the remainder of this century and into the next. (Sanders Tr. 349; Pl. Exh. 15 p. 2) 16. Defendants have recognized that inadequate resources could doom Ohio students to a second class educational system the effects of which will be felt far into the future. Similarly, inequitable distribution of resources will deny some students access to the educational opportunities students enjoy in wealthier districts. (Sanders Tr. 362; Pl. Exh. 15, p. 15) 17. Investment in education is essential to the state's economic growth and security. (Sanders Tr. 4550-4551) 18. In September of 1993, Superintendent Sanders notified the school superintendents of Ohio that-the legislative budget efforts for the current biennium had not been able to "...secure a level of funding sufficient to cover even the ongoing cost of current operations for all of our school districts." (Sanders Tr. 412; Pl. Exh. 39; Pl. Exh. 31) 19. Defendants have conceded that the disparities in the state's spending across school districts in the state are not good public policy. A range of two to one in expenditures for education is too great as a matter of public policy. (Sanders Tr. 4490-4491) 20. either the Ohio General Assembly, the Ohio Department of Education nor the State Board of Education has ever determined the amount of money required to provide a specific educational program for a specific school pupil. Amounts appropriated for the funding of public elementary and secondary education are a "budgetary residual" based on funds remaining after programs with legal entitlement have been provided for. (Russell Depo. 90; Tavakolian Depo. 142; Sanders Tr. 4525 4526; Phillis Tr. 1725-26; Fleeter Depo. 11; Shoemaker Tr. 4161) 21. Many school districts in Ohio do not have enough money to cover the basic needs of the pupils whom they are statutorily and constitutionally obligated to educate. (Sanders Tr. 4548; Shoemaker Tr. 4175) 22. Neither the $54 increase in the foundation level, the provision of $60 million in "equity" money for the 1993-94 school year, nor the additional $75 million in "equity" money for the subsequent year is sufficient to significantly reduce the degree of inequity in school funding in Ohio (Sanders Tr. 4544) 23. The Governor acknowledges that there are inequities in the system of public school funding in Ohio, and that unless this is remedied a court will order a remedy. Governor Voinovich wants to see more equity in the school financing system. (Browning Tr. 4464, 4466) IV. THE HISTORY OF SCHOOL FUNDING IN OHIO A. HISTORY OF OHIO'S PUBLIC SCHOOL FUNDING SYSTEM 1. The Northwest Ordinance of 1787 recognized that education is important in our society: "Religion, morality and knowledge being necessary for good government and the happiness of mankind, schools and the means of education shall forever be encouraged." (Pl. Exh. 161; Pl. Exh. 445; Pl. Exh. 142 p. 2) 2. In 1785, a land ordinance was adopted setting aside the 16th section of each township in each county of Ohio for the maintenance of public schools within the township. (Pl. Exh. 161) 3. The delegates to the Ohio Constitutional Convention of 1802 recognized that "schools and the means o� instruction shall forever be encouraged by legislative provision, not inconsistent with the rights of conscience." (Pl. Exh. 445) 4. The 1802 Constitutional Convention delegates also found that the doors of Ohio's schools should be open without distinction or preference, and that the common school system of Ohio should be adequate to afford a liberal education, not merely the rudiments of education, to the whole population. (Pl. Exh. 445) 5. In 1821, Ohio's first general school act provided for the establishment of school districts in each township and the for property within each district to be subject to school taxes. The Act was a failure because the levying and collections of taxes was at the discretion of the district. (Alexander Tr. 3631; Pl. Exh. 161) 6. In 1822, the Commissioners of Ohio's Common Schools recognized that "education should seek to bring its subjects to the perfection of their moral, intellectual and physical natures, so that they may be of the greatest use to themselves and others." The Commissioners also recognized that "with a population, made up entirely of individuals, thus educated, our penitentiary would hardly be needed, or if needed at all, its tenants would be few, and the expenses of that school or vise, trifling to the community." The Commissioners asked the question, "what man among us would not sooner pay tax for the purpose of educating the poor, in the ways of knowledge and virtue, than, in the penitentiary, be preparing them for doing more and more mischief to society." (Pl. Exh. 458, p. 3) 7. In 1825, Ohio's next major school act passed allowing for the election of school directors to manage the schools and a county board of examiners to certify teachers. The Act required districts to levy taxes on property. (Pl. Exh. 161) 8. The current language of Article VI, Section 2 of the Ohio Constitution, commonly known as the "thorough and efficient clause," and requiring the Ohio General Assembly to secure a "thorough and efficient system of common schools throughout the state" was adopted as part of the 1851 Ohio Constitution on March 10, 1851. The 50th General Assembly of the State of Ohio under the Constitution of 1851, provided for the reorganization, supervision and maintenance of common schools in Ohio by act dated November 15, 1852. (Pl. Exh. 459) 9. The concept of "common schools" emerged from the writings of Henry David Thoreau and John Locke and later Thomas Jefferson, Benjamin Rush, Horace Mann, and Ohio's first Superintendent of Common Schools, Samuel Lewis. The concept was based on the view that education is one of the rights of man, that every person was entitled to knowledge, and that knowledge should be protected by government. The "common school" related to commonality of benefit from education. The word "common" in this context historically and philosophically means that the government participates in a social contract with all of the people in the state and they all participate equally. Government has no reason to treat them differently. (Alexander Tr. 3628-29) 10. The term "system" as related to the concept of a system of common schools was discussed by Benjamin Rush as encompassing the concept of an organized delivery of public education on equal terms to all pupils, the concept of system was incremental in that the educational structure envisioned by the framers was one that developed from grade to grade. (Alexander Tr. 3632) 11. The terms "thorough and efficient" in the historical and philosophical context of the development of education clauses encompass the idea that an efficient system of public education is one that developed all of the human capital of the state based on the view that the state must efficiently utilize its human capital in order to produce wealth. Education enabled the people of the state to become producers as well as consumers. (Alexander Tr. 3634-36) 12. In the context of the historical development of the terms "thorough and efficient system" of "common schools", it is the obligation of the state to provide for the schools and to provide the resources for the operation of schools. The state has a burden of justification if it departs from equal distribution of its resources for education. (Alexander Tr. 3636-37) 13. The delegates to the 1850 Ohio Constitutional Convention recognized that education is essential to self-government, freedom of the press, freedom of speech, and freedom of thought, and that "had not knowledge been shed upon the human understanding, all would have remained in the darkness of heathenism and governed by superstition and fanaticism." (Pl. Exh. 456, p. 15) 14. The delegates to the 1850 Ohio Constitutional Convention recognized that the institution of a thorough and efficient education system was necessary to allow Ohio to compete with the other states in the Union, and that in order to compete, Ohio would have to assist in "so great an enterprise." (Pl. Exh. 456, p. 15) 15. At the 1850 Constitutional Convention, the house committee that was convened to consider the role of the state in public education reported "[t]hat in the opinion of the committee, the education of our youth is the first care and highest duty of every parent, patriot, and statesman." (Pl. Exh. 456) 16. On September 3, 1912, Article VI, Section 3 of the Ohio Constitution was adopted, providing for the organization, administration and supervision of state schools. The Ohio School Survey Commission followed in 1913, and many of their recommendations were enacted into law in 1914. Some of those enactments were: a. Establishment of county school districts, which provided for the supervision of the schools in each county (Pl. Exh. 161); b. Fifty percent (50%) state reimbursement for the salaries paid to employees of each county system. This partial reimbursement partially funded the supervision mandate; however, schools relied almost exclusively on property taxes for funding until 1935 when the foundation program was adopted. (Pl. Exh. 161) 17. On November 3, 1953, the current version of Article VI, Section 4 of the Ohio Constitution was enacted, establishing a state board of education and a superintendent of public instruction to be appointed by the state board of education. (Pl. Exh. 187, 190). 18. The history of the Foundation Program is as follows: a. Prior to establishment of the foundation program, state support was only provided to financially weak districts under the provisions of an educational equalization law, which was repealed in 1935. (Pl. Exh. 161) b. In 1935 the General Assembly passed the Foundation Program Act, which created a method of funding a basic education for all public school students. (Pl. Exhs. 167, 168). The Program was constructed so that each school district in the state had a guarantee that the district would receive in total support in state and local taxes an amount determined by computing the district's Foundation Program payment. (Pl. Exh. 161) c. Under the original Foundation Program, a state sales tax was enacted to support schools, allowing 50 percent state funding for schools. The state share of funding remained at approximately 50 percent until 1946. From 1946 to 1965, the state share dropped to 30 percent. From 1965 to present, the state share has increased back to a level close to the 1935 level of state support of approximately 50 percent. (Phillis Tr. 1829; Pl. Exh. 161) d. The original Foundation Program calculated the cost of a school district's foundation program payment based on four different rates according to grade level. These rates applied to the number of students in kindergarten, in grades 1-8, in grades 9-12, and in part-time, continuing education and evening schools. An amount for transportation was included. (Pl. Exh. 161) e. Funds under the original Foundation Program were distributed based on ADA (average daily attendance). School districts received a flat distribution payment amounting to approximately 52 percent of calculated cost of each pupil level. A school district received additional aid if funds received from the flat rate plus 3 mills of assessed valuation were less than the calculated cost of the foundation program. (Pl. Exh. 161) f. Significantly, the original Foundation Program introduced three concepts in school funding to Ohio: an equalization factor; a formula charge off based upon a local community's ability to fund schools; and a guaranteed amount of financial support for the district. (Pl. Exh. 167, 168) g. Changes to the Foundation Program over the next 20 years were minimal and included the increase of both the charge-off and required local millage. Distribution changed from a basis of ADA (Average daily attendance) to ADM (average daily membership). h. In 1956, the Foundation Program Act was repealed and replaced by a five-prong funding formula based on teacher units, a teacher salary allowance, a current operation expense allowance, and a formula charge-off deduction. Special education and vocational education units were also allocated by this formula. (Pl. Exhs. 167, 168) i. The number of units under the 1956 formula was based upon the number of students in all instructional areas; one unit was assigned to each of thirty students in grades 1-12, and one unit was assigned for each kindergarten unit. Added to these classroom units were the number of approved special education and vocational units, one administrative unit for each 8 classroom units, and one supervisory unit for the first 50 approved classroom units and one for each additional 100 units. (Pl. Exh. 161) j. Under the 1956 formula, a school district received the larger of two calculations (1) The unit allowance times the number of units or; (2) The salary allowance of all certificated personnel according to the minimum teachers' salary schedule, plus amounts for retirement and sick leave, classroom operation and transportation less the 10 mil charge off. (Pl. Exh. 161) k. In 1972, the foundation calculation returned to an ADM basis. The charge-off was applied to the basic aid amount plus supervisory amounts, with transportation, special education and vocational education classroom units not subject to the equalization charge-off. Municipal overburden funding was introduced, targeting funds to districts with an ADM of greater than 20,000. Districts with an ADM greater than 70,000 received additional amounts. (Pl. Exhs. 161, 168, 169) l. In 1976, the equal yield formula was introduced. It was intended to provide an equal sum of combined state and local funds, on a per pupil per mill basis, for each qualifying school district. The millage for each district was equalized to reflect estimated changes in the per pupil value of a mill figure due to reappraisal of real property values. (Pl. Exhs. 161, 167, 168). The Equal Yield Formula provided a 2-tiered system: (1) Every district received an amount per pupil per mill for the first 20 mills; (2) Additional amounts were given to school districts with millage above 20 mills up to 30 mills. (Pl. Exh. 161; see also Tavakolian Depo. 48) m. The equal yield formula, subject to challenge in the case of Cincinnati v. Walter (1979), 58 Ohio St. 2d 368, operated differently than the school foundation program. The equal yield formula incorporated a "power equalizing" tier by which local millage in excess of 20 mills was augmented with additional state revenue. The power equalizing portion of the system was never fully funded, and the power equalizing concept was abandoned by the legislature in 1981. (Phillis Tr. 1836; Ocasek Tr. 2822-2823; Fleeter Depo. 13) n. The Equal Yield Formula increased the disparity in the revenue actually received by school districts. Districts which voted the additional millage necessary to receive the incentive funds were usually wealthy districts. (Pl. Exh. 161) o. In 1976, the current DPIA (disadvantaged pupil impact aid) replaced municipal overburden funding. DPIA changed the focus from districts with large populations to districts with high percentages of children from families on ADC. (Pl. Exh. 161) p. In 1982, the foundation formula assumed its present form. This Formula, as described in Plaintiffs' Exhibit 399, was designed to assure each school district adequate funding to provide each student a basic education at 20 mills of levied property tax. (See Stip. 15; Pl. Exhs. 161, 168, 169) 19. Transportation was the first categorical program. Categorical funding for special education was introduced in 1945, and by 1958, there were six categorical line items. Currently, there are 70 categorical line items in the state budget. (Pl. Exhs. 161, 168, 169) 20. During the period from 1982-1990, Federal funds flowing to state school districts represented an average of four to five percent of the total budget for public elementary and secondary education. The remainder of the funds were made up of a combination of state and local tax revenues. (Russell Depo. 27) B EDUCATION APPROPRIATIONS AS A FUNCTION OF THE STATE BUDGET 1. The biennial budget begins July 1 of every odd numbered year. The State of Ohio must have a balanced budget. (Browning Tr. 4364) 2. In the last biennium, the state went through four rounds of budget cuts. The Governor cut over $700 million out of the budget. (Browning Tr. 4414) 3. The largest single item in the general revenue fund appropriation in the recent budget was Medicaid, reflecting 32.1 percent. Medicaid has increased approximately five times the rate of inflation. Medicaid is an entitlement program. (Browning Tr. 4374) 4. The budget for the Department of Rehabilitation and Correction has been growing dramatically. There has been a growth in incarceration from 16,000 in the early 1980s to a projected 42,000 in July, 1994. The Department of Education and Superintendent of Public Instruction recognize the relationship between the number of high school dropouts and the size of the prison correction population. (Sanders Tr. 349; Pl. Exh. 15 p. 2; Browning Tr. 4376) 5. Both the appropriations for Medicaid and the Department of Rehabilitation and Correction have been growing at the same rate. (Browning Tr. 4377) 6. For the fiscal year 1994-95 biennium budget, prison spending rose over 33 percent. The budget proposed hiring 904 new correction officers, a proposal adopted by the General Assembly. The debate about hiring new guards was intensified by the Lucasville prison riots. (Browning Tr. 4395-96) 7. In the new biennium, Human Services received an increase of 16 percent. Spending for colleges and universities also rose about 6.6 percent. (Browning Tr. 4397) 8. The increase for primary and secondary education in the new biennium (FY94 and FY95) is only approximately 4 percent over the biennium. (Browning Tr. 4393) 9. The state education budget receives the remaining funds after state legislative appropriations for human services and corrections. (Sanders Tr. 4555; Pl. Exh. 40; Shoemaker Tr. 4161; Russell Depo. 92) 10. Over the past 16 years, the relative percent of the state budget devoted to elementary and secondary education has declined. (Russell Depo. 52; Shoemaker Tr. 4174-75; Pl. Exh. 182 p. 6; Tavakolian Depo. 50; Maxwell Tr. 138) 11. In FY81, total educational disbursements in the State of Ohio were 35.54 percent of all state disbursements. In FY93, educational disbursements were 31.39 percent of total state disbursements. (Pl. Exh. 38) 12. Pl. Exh. 142 is the final report of the Gillmore-Cupp Commission to Study School Funding and Expenditures, released to the Ohio Senate in 1989. That document recognized that primary and secondary education's share of the overall state operating budget gradually decreased over the decade of the 1980's. The Gillmore Cupp Commission determined that if education funding from 1979 to 1989 kept pace with increases in general revenue funding, there would have been $3.1 billion more for education. (Shoemaker Tr. 4159-60; Pl. Exh. 142, p. 3) 13. The extent of disparities in funds available for the education of pupils among Ohio school districts has grown over the period from 1980 to 1990 and continues to grow. (Tavakolian Depo. 52) 14. When the legislature passed a $1 billion increase in taxes in Ohio in December, 1992, President Ocasek was astounded that the money did not go for education. (Ocasek Tr. 2859) 15. In the total context of the most recent State Budget, education did not do well, and other areas of state government did better in funding. (Ocasek Tr. 2960) 16. The 1992-93 budget was the first to allocate Division of Youth Services tuition charges to school districts; those costs have formerly been absorbed by the State. (Tavakolian Depo. 168) 17. The new budget for FY94 and FY95 approved by the General Assembly included a $115 million pay raise for state employees. (Browning Tr. 4397-98) 18. During his employment as Director of the Office of Management and Budget, commencing in January, 1991, Director Browning's salary has increased 15 percent. He, as well as other state employees, enjoys standard state health benefits, including HMO coverage, dental and vision care, for him and for his family members. (Browning Tr. 4442-44) 19. Within the current education budget of $8 billion, there are some line items that do not go to public school districts, including those for county MRDD boards, for transportation and vehicle purchases, totaling $13.3 million. Also, $160 million is contained the budget for "auxiliary services," but this represents monies spent for children in non-public schools. (Browning Tr. 4411) C. THE IMPACT OF STATE BUDGET REDUCTIONS ON PUBLIC EDUCATION 1. The Governor of Ohio has the authority to reduce funds appropriated for the operation of the school foundation program at any time in the event of a projected shortfall in state tax revenues. Such reductions have been implemented by three Ohio Governors since 1980, with the latest of these cuts occurring in FY92. In that year, due to a projected shortfall of state revenues to meet state appropriations, Governor Voinovich cut $88.8 million out of the state funding for primary and secondary education. (Stip. 13; Browning Tr. 5487) 2. In the 1992 cuts, the poorest 172 districts in the state were subject to a hold harmless clause. Those districts are listed in Stipulation Exhibit 14. (Stip. 13; Stip. Exh. 14; Browning Tr. 5487) 3. These reductions caused some school districts to seek spending reserve loans and others to seek increases in the size of emergency school assistance loans previously approved. (Brown Tr. 5487) 4. By law, the state of Ohio must have a balanced budget. The State cannot engage in deficit spending. By its actions in implementing budget cuts and reducing monies that otherwise would be going to public school districts, the State has forced some of those districts to borrow money that would otherwise not have been borrowed. (Brown Tr. 5494) 5. In January 1992, Superintendent Ted Sanders issued a memorandum to all city, county, local, exempted village and joint vocational school superintendents in the State of Ohio regarding the budget reductions imposed by the Governor in January of 1992 detailing the impact of the $88.8 million budget reduction on the school districts in the State of Ohio. (Pl. Exh. 17) 6. As a result of budget cuts required by the 1993 budget bill, H.B. 152, basic aid was held harmless, but the remainder of the SF-12 items received cuts of 1.37 percent. Consequently, DPIA, special education, gifted education and transportation were cut across the board by 1.37 percent, and vocational education was cut by .28 percent. (Pl. Exh. 442) 7. Senator Aronoff testified that in the last biennium, there were approximately $700 million made in overall budget cuts by the State of Ohio. Neither Senator Aronoff nor Governor Voinovich, nor any legislator, is in a position to make any assurances to anyone that there will not be any further budget cuts in this biennium, the next biennium, or beyond. (Aronoff Tr. 4858-59) 8. Director Browning also conceded that it is possible that another budget crisis will arise in the next biennium, so that the state may once again have to reduce expenditures. This is because Ohio is required to have a balanced budget, and the Governor has authority in that regard to cut the budget, and the General Assembly can act at will. (Browning Tr. 4414) 9. There are always unanticipated expenses that can occur that will affect the budget. Such expenses include the Lucasville prison riot, which was unanticipated and cost the State of Ohio at least $10 million, as well as additional funds not yet tallied. (Browning Tr. 4417) 10. With reference to equity funds to school districts, Senator Aronoff testified that there is no assurance beyond the present biennium budget that there will be any further equity funds available to any school districts after FY95. (Aronoff Tr. 4854) Although the State of Ohio, according to Senator Aronoff's testimony, has a surplus of approximately $100 million, Senator Aronoff refused to say whether any of those monies would go toward education. (Aronoff Tr. 4855) 11. President Ocasek's frustration as a legislator, and today as a taxpayer, is that the legislature can appropriate monies for only a two year period. Having been an educator, he finds it very difficult to run a school district on a two-year commitment. (Ocasek Tr. 2822-2823) D. BUDGET AND POLICY RECOMMENDATIONS OF THE STATE BOARD OF EDUCATION 1. Every two years the State Board is required by law to develop budget and policy recommendations to the Ohio General Assembly. (Russell Depo. 10) 2. The State Board of Education prepares and submits recommendations to the Ohio General Assembly in advance of the approval of each biennial budget. The State Board's recommendations are developed through the efforts of the State Board members and the Ohio Department of Education staff with input from state educational organizations and other interested persons. (Tavakolian Depo. 19) 3. State Board of Education budget proposals have been heard before the Education Subcommittee of the House Finance Committee. The level of appropriations is determined by the Full Finance Committee in the House and the Senate Finance Committee, neither of which routinely hear Department of Education testimony in support of its education budget. (Phillis Tr. 1800-01) 4. The State Board's budget proposals are based on estimates of the costs of the programs proposed together with a consideration of political realities. (Tavakolian Depo. 143) 5. According to the Budget and Policy Recommendations for the 1992-93 biennium, the "common" school that served so well in the past is not able to cope effectively with the changes in the social and economic order. The school system must be restructured immediately to accommodate the current social and economic needs. The call for reform during the decade of the 1980s produced minimal results. The State Board of Education believes the "common" school can and will be restructured to more appropriately serve the pupils of Ohio. The State Board of Education's Policy and Budget Recommendations convey a sense of urgency for educational reform and restructuring. (Pl. Exh. 16, 1-2) 6. Tavakolian Exhibit 1 is the Legislative Recommendations to the Governor and Members of the 117th General Assembly adopted by the State Board of Education and submitted to the 117th General Assembly for FY88 and FY89. (Tavakolian Depo. 22; Tavakolian Depo. Exh. l) 7. Tavakolian Exhibit 2 is the State Board's legislative Recommendations to the Governor and Members of the 118th General Assembly as adopted by the State Board of Education on or about Dec. 12, 1988. (Tavakolian Depo. 23; Tavakolian Depo. Exh. 2) 8. Tavakolian Exhibit 3 is the State Board's Policy and Budget Recommendations to the Governor and the 119th General Assembly as adopted by the State board on December 10, 1990. At that time, the State Board of Education determined that the Ohio Constitution may reasonably be interpreted as follows: a. The General Assembly, not the local school district, bears full responsibility for providing an education system. b. "Common" implies that schools must be available to all at no charge and implies a level of adequacy of uniform quality. Common schools must be supported by taxes and by their nature cannot be private. c. "Thorough and efficient system" implies a high degree of uniformity of programs and services. It implies an appropriate curriculum that is reasonably uniform for all children. It also implies that each pupil in Ohio has an equal prospect for educational opportunities. (Tavakolian Depo. 27; Tavakolian Depo. Exh. 3) 9. Stipulation Exhibit 12 represents a comparison of the amounts requested by the State Board of Education as compared with the amounts actually appropriated for the operation of public schools for a number of years. That comparison reflects that in FY86 and FY87, the legislature appropriated more dollars than were requested by the State Board of Education. In all other years the appropriations were far less than required. The reason for the 1986-87 appropriation level was that the State Board of Education advanced a master plan for the improvement of public education with respect to those years but did not reflect the cost of those specific proposals in their budget requests. (Phillis Tr. 1729-30) 10. The State Board's Budget and Policy Recommendations for 1984 and other years included a recommendation for the equalization of funding for facilities. By that recommendation, funds would be appropriated such that a mill of tax for facilities in a poor school district would be brought up to a greater level so that there would be an equalization of funding for levels of tax effort. Equalization has been proposed by the State Board of Education a number of times but has not been approved. (Phillis Tr. 1732-33) 11. For the last two fiscal years (FY94 and FY95), the State Board of Education requested a billion dollars more in funding than that which was appropriated by the General Assembly. (Ocasek Tr. 2806) 12. For FY94 and FY95, the State Board of Education requested a $1.9 billion increase from the General Assembly and received only a total of $625 million increase in funds for public education. (Russell Depo. 53) 13. The $1.9 billion increase that was requested for elementary and secondary education by the Department of Education for the 1994-1995 biennium, and which was not included in the State budget, represented amounts reasonably believed by Dr. Sanders and the State Board of Education to be necessary for the education of Ohio's public school pupils. (Sanders Tr. 4527) 14. President Ocasek referred to the Budget and Policy Recommendations of the State Board of Education for the 120th General Assembly (Pl. Exh. 15), in which the State Board of Education advocated the need for comprehensive reform in Ohio's system of funding public education. The current State Board of Education, upon which President Ocasek serves, concurs in that position, as does President Ocasek, personally. (Ocasek Tr. 2794) Additionally, President Ocasek testified that the current State Board of Education has adopted the three goals set forth in Pl. Exh. 15, including the goals of equity, adequacy and reliability of school funding. President Ocasek concurs in these goals. (Ocasek Tr. 2795) 15. Dr. Payton compared the State Board's proposal adopted December 13, 1992 (Payton Depo. Exh. 6) with the Governor's budget proposal at that time and found that the State Board's proposal would have resulted in greater increase in equity in both FY94 and FY95 than will be achieved by the provisions enacted by the General Assembly. (Payton Depo. 170-71) 16. Each year, the Ohio Board of Education publishes its annual report. Each of those annual reports contains information regarding appropriations and expenditures for education throughout the State of Ohio, as well as information, charts and graphs regarding demographic information, financial information and test scores for school districts throughout Ohio. Annual reports of the State Board of Education for the years 1980 through 1991 were admitted into evidence as Plaintiff's Exhibits 356 to 367. V. OPERATION OF THE SCHOOL FOUNDATION PROGRAM 1. Of the total revenue for the support of public schools in Ohio for FY92, 42.7 percent comes from state taxes, 5.7 percent comes from federal revenue sources, and 51.6 percent comes from local taxes. The percentage of state revenue is less for Ohio than for the nation, with the national percentage of state revenue being 48.3 percent. (Alexander Tr. 3706; Pl. Exh. 302 p. 10) 2. Plaintiffs' Exhibit 399 is a publication of the Ohio Department of Education describing the operation of the school foundation program. Van Keuren Deposition Exhibit 14 is a description of the method by which the cost of doing business factor (an element of the foundation program) is calculated. (Pl. Exh, 399; Van Keuren Depo. Exhs. 13, 14) B. STATE BASIC AID 1. Stipulations 8 through 12 and Stipulation Exhibits 11 through 13 deal with the concept of state basic aid and the basic aid levels from year to year as well as basic aid amounts requested compared to amounts appropriated. 2. For 1991, the basic aid level established by the school foundation program was $2,781 per pupil. That level of funding consists of a combination of state and local funds. The basic aid level is reduced by a "charge off" which has consisted of 20 mills times the assessed valuation of the school district. The amount of the "charge off" will vary with the valuation of taxable property in the district. In 1991, the 20 mill "charge off" produced $307 per pupil in the poorest school district, Huntington Local, and $17,408 in the wealthiest school district, Perry Local. (Maxwell Tr. 57) 3. State Basic Aid is reflected on lines 5 and 6 of the Ohio Department of Education form SF-12. State Basic Aid is adjusted by the school district equalization factor, also referred to as the cost of doing business factor. The range of adjustment is from zero to 1.075 times the basic aid amount. The adjustment varies from county to county, with Cuyahoga County receiving the largest adjustment. (Maxwell Tr. 97) 4. The cost of doing business factor is calculated for school districts every two years with wage data obtained from the Bureau of Employment Services, which includes eight or ten different sectors in the economy used to calculate the average weekly wages. School district employees wages would be figured into the public employee sector of the calculation, along with all of the other sectors, and would be a very small portion of the total calculation. Educational costs are not considered in computing the cost of doing business factor. (Payton Tr. 4921-22) 5. Cost of doing business factors are applied equally all school districts in a county, regardless of the actual cost of operations in the individual districts. (Maxwell Tr. 97) 6. Cost of doing business factors assume that costs are lower in rural districts. However, costs in rural districts, particularly in construction, may be as high or higher than in urban districts. (Shoemaker Tr. 4176-77) 7. If a school district buys textbooks, pays utility bills, purchases insurance, or is required to pay other fees, those expenses would not be affected by location in the state. (Payton Tr. 4921-22) 8. The cost of doing business factor for Southern Local is approximately 1.02, which is on the lower end of that adjustment. For many expenses, the cost of doing business in Perry County is not less than the cost of doing business in any other county, because mechanical parts may have to be ordered from somewhere else, service personnel have to come from Columbus, and transportation costs must be paid for that travel. (Spangler Tr. 480-81) 9. Average Daily Membership (ADM) is the number of pupils included in the basic aid portion of the school foundation calculation. ADM does not include one-half of the kindergarten pupils, pupils in special education units, or pupils in vocational units except that in school districts with pupils attending joint vocational schools, only 75 percent of the ADM count for vocational pupils is excluded. Preschool special education pupils are not included in ADM though special education programming �or those pupils is required by law. (Maxwell Tr. 101-104) 10. The increase in the charge-off from 20 mills to 20.5 mills in the first year and from 20.5 to 21.0 mills in the second year represents savings to the state of approximately $13 million per year for each of those years. (Sanders Tr. 4528) 11. The increase in the "charge-off" from 20 mills to 20.5 mills in 1993-94 and 21 mills thereafter will require a greater contribution of local dollars to maintain the same relative level of funding. (Russell Depo. 89; Shoemaker Tr. 4173; Pl. Exh. 182, p. 4) 12. The combined effects of increased valuation through reappraisal, resulting in an increased "charge off" applied to the calculation of basic aid, with the lack of growth in local tax levy revenue due to the application of tax reduction factors leads to a circumstance under which some school districts can experience a growth in the value of local school district property and a net loss in school district operating revenue. This circumstance is an aspect of a problem with the current foundation program sometimes described as "phantom revenue." (Maxwell Tr. 98-99; Maxwell Depo. Exh. 3 pp. 37-38; Russell Depo. 87-88; Fleeter Depo. 22, 23) 13. The amount of the 20 mill charge-off provision of the foundation program is determined solely based on the valuation of taxable property in the school district without regard to the income of the school district residents. The sole reliance on property value for this purpose is considered by the State Board of Education to be a weakness in the school foundation program. (Tavakolian Depo. 57) 14. The changes in the foundation program for FY94 and FY95 have also created circumstances by which some school districts will actually receive less money, considering the operation of the foundation program and guarantee provisions, than they would have received without the changes. (Maxwell Tr. 139, 141, 143) 15. Failure to increase state basic aid level by a sufficient amount for the current biennium has further exacerbated the fundamental weaknesses in the school foundation program. (Maxwell Tr. 143) 16. Under the current biennial budget, approximately 130 to 140 Ohio school districts will receive less in state funds than they received previously. Absent the passage of additional local tax levies those districts are faced with the problem of continuing their education programs with reduced levels of funding. (Sanders Tr. 4494) 17. The amount of basic per-pupil aid guaranteed to local school districts by the foundation formula ($2,817 per pupil for school year 1992-93) is determined by the General Assembly in conjunction with the biennial budget process. (Stip. 9) 18. The State Board of Education, according to President Ocasek, has taken the position that the foundation figure should be $4,000 per pupil. (Ocasek Tr. 2838) 19. The difference between average per pupil expenditure and state basic aid has increased each year over the past five years. One of the weaknesses is the school district per pupil expenditure is greater than the foundation formula amount. The disparity between the two numbers has increased over time. (Tavakolian Depo. 53; Russell Depo. 92) C. THE RELIABILITY OF STATE FUNDING AND FORM SF-12 1. Reliability is an important aspect of school finance. If school districts are unable to rely on stable income, they cannot plan educational programs with the confidence that they will be sustained. (Sanders Tr 362-363; Pl. Exh. 15 p. 15) 2. The funding formula does not provide reliable funding for school districts. School districts cannot operate efficiently when they do not know what their revenue will be. The reliability of state funding has been a problem for school districts in planning and budgeting. (Taylor Depo. 96; Washburn Tr. 2330; Fleeter Depo. 1) 3. There is no single document to tell a school district Treasurer the total amount of local tax revenue that the school district will have for the year. The County Auditor is the sole source of information about the amount of local property tax revenue to be received. (Russell Depo. 77, 78) 4. The final tax distribution of local property tax revenue is in the fall, the only time that a school district knows for sure how much it will receive in local tax revenue. (Brown Depo. 183; Russell Depo. 80) 5. The Department of Education notifies public school districts of the amount of money to be received from the school foundation program, which provides funding for basic aid, Disadvantaged Pupil Impact Aid, special education, gifted education, transportation, vocational education, and extended service, through the use of a form called an SF-12. (Taylor Depo. 97) 6. Payment of foundation funds is made based on an estimated number of students, and an estimated number of vocational, special education and gifted units, from July through December. Upon receipt of updated information, the Department of Education recomputes the SF-12. (Stip. 12) 7. Approximately 80-85 percent of the state funds for public elementary and secondary schools are distributed through the programs reflected on the SF-12. (Maxwell Tr. 93) 8. Form SF-12 is the only document by which the Ohio Department of Education notifies school districts of the amount of School Foundation funds that the district will receive, and school districts are expected to rely upon that document. During FY90, five or six different SF-12 forms were mailed to school districts during the year. During FY92 at least one SF-12 per month was mailed to school districts. (Van Keuren Tr. 4751-4752; Phillis Tr. 1899) 9. For planning purposes, Southern Local relies heavily on the State Foundation 12 Report (SF-12). (Spangler Tr. 479) 10. The SF-12 forms provided to Southern Local School District for FY93 varied as much as $55,000 from one form to another. For Southern Local $55,000 is as much as the district spends on all materials and supplies in a year. (Spangler Tr. 583-85; Pl. Exh. 87) 11. The average number of SF-12's received by school districts in Area 5, which includes Plaintiff Dawson- Bryant, increased in FY93 such that districts in the Area had a more difficult time planning because of the number of changes in their SF-12s. (Taylor Depo. 253) 12. For FY1993, the numbers of SF-12s received by each of the plaintiff school districts, and the amount of the line 23 total state support indicated thereon, was as follows: Run Date Dawson- Bryant Local Lima City Northern Local Southern Local Youngstown City 7-01-92 3,880,340.78 16,360,780.6 5 4,002,801.48 2,652,596.05 43,184,450.2 8 8-01-92 N/A 16,139,157.4 5 4,075,613.66 2,650,239.12 42,770,746.0 8 9-02-92 3,877,744.25 16,139,642.2 8 4,077,878.33 2,651,920.42 42,823,246.1 9 1-29-93 3,820,792.80 16,123,736.2 1 4,295,150.54 2,535,431.18 42,779,196.1 3 2-26-93 3,820,792.80 16,123,736.2 1 4,295,150.54 2,535,431.18 42,779,041.7 0 4-07-93 3,826,381.82 16,124,713.9 4 4,270,583.04 2,535,431.18 42,793,875.1 4 4-23-93 N/A 16,135,577.8 1 N/A N/A N/A 5-07-93 3,839,544.98 16,135,577.8 1 4,300,386.00 2,550,459.65 42,791,820.3 2 5-21-93 3,836,680.09 16,135,577.8 1 4,314,724.55 2,544,781.70 42,807,305.7 7 6-25-93 3,837,493.15 N/A 4,315,933.89 2,562,532.61 42,577,701.3 5 7-15-93 3,837,494.15 N/A 4,322,055.09 2,606,815.39 42,753,073.1 7 Plaintiffs' Exhibit 214 is a true and accurate summary of the FY93 SF-12s for each of the plaintiff districts, which were admitted into evidence as Plaintiffs' Exhibits 87, 131, 211, 212, and 213. (Pletcher Tr. 2643; Pl. Exhs. 87, 131, 211, 212, 213, 214) 13. Family income is a major factor in the formula for distribution of the equity funds, but is not a factor in the distribution of funds to school districts under the SF-12. (Taylor Depo. 155; 158) D. GUARANTEE PROVISIONS 1. Stipulation Exhibit 13 is a chart which accurately depicts the number of school districts receiving dollars under a guarantee provision rather than a formula amount, and the total cost of guarantee payments over and above formula payments for FY84 through FY93. (Stip. 11; Stip. Exh. 13) 2. The number of districts receiving guaranteed payments increased from 190 in FY84 to 360 in FY92 and 247 in FY93. Over one-third of all school districts in Ohio received guaranteed payments in FY93. The cost of the guarantee has increased from $55.1 million in FY84 to $156.9 million in FY92 and $130.2 million in FY93. (Stip. Exh. 13) 3. Guarantee provisions of the school foundation program ensure that school districts will receive the greater of the program amount or the guarantee amount. There are three different guarantee provisions, the most common of which is the basic aid guarantee. Stipulation Exhibit 13 reflects that for 1993, 247 school districts received payments of funds under a guarantee provision rather than under the foundation formula, costing the State an additional $130.2 million. (Maxwell Tr. 111; Maxwell Depo. Exh. 3 p. 44) 4. Guarantee provisions of the foundation program are designed to prevent substantial losses of school district revenue due to changes in valuation or changes in the size of the pupil population. (Russell Depo. 114). 5. A majority of the funds distributed to school districts as a result of the guarantee provision of the funding system goes to the highest wealth districts. (Payton Depo. 156; Russell Depo. 118). 6. The Beachwood City School District has an average valuation per pupil of approximately $288,000.00. (McMurrin Tr. 2499; Pl. Exh. 270). Beachwood City School District receives approximately $90,000.00 per year under the state foundation program by reason of guarantee provisions. (McMurrin Tr. 2579) 7. Guarantee districts would stand to gain from the receipt of additional funded units, such as special education or vocational units, since the loss of basic aid pupils to those units will not adversely affect their basic aid payment. (Russell Depo. 119) 8. The operation of the guarantee provisions of the foundation program is considered a weakness in the program by the State Board of Education. (Tavakolian Depo. 55; Russell Depo. 117; Shoemaker Tr. 4171; Pl. Exh. 142 p. 20) 9. Since 1980, the number of school districts receiving basic aid under a guarantee provision of the foundation program has tended to fluctuate in proportion to the amount of funding provided by the General Assembly. (Tavakolian Depo. 57) E. CATEGORICAL FUNDING 1. Categorical funds are basically flat distributions based upon ADM (the number of students). The main categoricals, which have never been fully funded, include special education and vocational education. (Ocasek Tr. 2844) 2. There is no equalization for funding of categorical units, so that each district receives funding for vocational, special education, and gifted units based on the same formula. (Taylor Depo. 105) 3. The Department of Education recommended to the 120th General Assembly that categorical program funds be equalized because the unit funds do not pay the full cost of the service being provided and the burden of making up the difference in costs falls more harshly on poor districts than rich. That recommendation was not approved. (Sanders Tr. 367-368) 4. The fact that categorical programs are not equalized is considered a weakness in the foundation program by the State Board. (Tavakolian Depo. 54) F. SPECIAL EDUCATION UNIT FUNDING 1. Special Education unit funding is described in Stipulations 58, 59 and 61 through 75, together with Stipulation Exhibits 32 and 33 2. The State of Ohio provides funds for the support of special education programs and services through a "unit funding" mechanism whereby funds are allocated to school districts in accordance with a formula that includes teacher compensation based on the state minimum teachers' salary schedule, retirement and all other fringe benefits at 15 percent of the state minimum teachers' salary and a fixed amount for all other expenses. (Stip. 58) For classroom units, the fixed amount is about $8,900 and for a related services unit, about $2,000. (Roach Tr. 2682; Herner Tr. 5520; Schindler Depo. 18) 3. A unit, in general terms, is a professional staff person, such as a teacher for a classroom unit, or a school psychologist, speech and hearing therapist, or occupational therapist for a related service unit. (Herner Tr. 5520) 4. The estimated average amount of funding provided in connection with a funded special education unit is $30,000 to $35,000. (Stip. 59) 5. Funded special education units are determined by the legislature and allocated by the State Department of Education. In the allocation of units, a preference is given to those that had the units last year; then to pupils formerly educated in MRDD units. (Russell Depo. 99) 6. Age ranges are applicable to funded special education units; if a child outgrows the unit, the child must be educated with local dollars if no additional unit funding is available. (Russell Depo. 100) 7. For the current year (1993-94) school districts have received a 1.37 percent reduction in funds for special education applied to categorical funding. (Pl. Exh. 442) 8. Since about 1990 (actually 7/26/91 per ORC 3317.13), there has been no increase in the state minimum teacher's salary schedule and, accordingly, no increase in the amount of funds provided by a funded special education classroom unit or a funded vocational or gifted unit. (I-lerner Tr. 5564; Maxwell rr. 144; Maxwell Exh. 6) 9. There are more applications for funded special education Units than there are units available. 1 order to apply for funding for a special education unit, a school district must first provide (without any guarantee of funding) the program and services that would qualify the unit for special education funding. (Van Keuren Depo. 196-197) 10. The amount provided for teacher salary and benefits through a funded special education classroom unit is generally less than the actual cost of the unit. (Russell Depo. 101; Van Keuren Depo. 195) Approximately GO percent of the costs of providing the unit is paid by the unit amount. (Russell Depo. 102) 11. If no special education program is available in the local school district, the pupil may be served in a multi-district collaborative program. (Russell Depo. 103) G. VOCATIONAL UNIT FUNDING 1. Joint vocational school programs are funded through a combination of unit funding and vocational school district tax levies. City school districts that provide vocational funding may receive unit funding for specific vocational programs but do not have the benefit of separate tax levies to fund vocational programs. For those districts, costs in excess of the unit funding costs are paid from the school district's general funds. (Tavakolian Depo. 104) 2. Funding provided to joint vocational school districts has been partially equalized since January 1989. (Shoemaker Tr. 4212) 3. Pupils included in vocational unit funding are excluded from ADM; thus, no state basic aid is received with respect to those students. The categorical aid that is received is less than the cost of operating the vocational program, with the difference coming from funds otherwise available �or school district genera] fund expenditures. Vocational programming is required to be offered to all high school juniors and seniors. (Maxwell Tr. 117-119: Maxwell Depo. Exh. 3 p. 60) H. DPIA 1. Disadvantaged Pupil Impact Aid (DPIA) is a dollar amount provided to school districts based on the concentration of disadvantaged pupils in the district. Disadvantaged pupils, for this purpose, are those on Aid to Dependent Children as a percent of the base l\l)M. For 1993, a school district with 20 percent or more of its children on ADC will receive an additional $1,092 for each such pupil. The state mean percent or more of pupils has increased from 12.62 percent in 1982 to 15.5 percent in 1992. (Maxwell Tr. 115; Stip. Exh. 2 2. As the percent of the district's ADC pupils increases over certain threshold percents, the amount paid for each eligible pupil also increases. The formula ranges from a low of five percent to a high of twenty percent. No additional per-pupil funding is provided above the twenty percent level. The additional funding per ADC pupil ranges from a hundred dollars per ADC pupil to a high of $1,092 per ADC pupil. (Russell Depo. 120) 3. The foundation program provisions for additional revenue for ADC pupils assume that the education of those pupils will cost more, but the Department of Education has no current information as to the amount of the additional costs involved. (Russell Depo. 121) 4. The current formula does not accurately reflect the additional costs of educating pupils in high concentrations of poverty. (Russell Depo. 122) 5. The addition of revenues based on DPIA and other special needs funds may increase the total expenditures of school districts receiving those funds, but a large portion of the money received by the low-income districts is actually targeted to helping disadvantaged students and therefore is addressing special needs with the districts as opposed to equalizing spending on regular education between the districts. (Porter Tr. 1091; Pl. Exh. 100 Chart 4) 6. The shift to a three-year average of ADC pupils in the current budget has the effect of under-counting those pupils and reducing the actual amount of DPIA to be received by school districts. (Maxwell Tr. 228) 7. Although the DPIA system was implemented to provide funding for the education of disadvantaged pupils, it is currently being used as an urban impact aid system. There is no predictability in the DPIA system. (Shoemaker Tr. 4103-04) 8. For school foundation program calculations, the numbers of ADC pupils in a school district are determined by the Department of Human Services. The gain or loss of ADC pupils may have a substantial impact on a school district's revenue. (Van Keuren Depo. 85; Russell Depo. 123; Maxwell Tr. 116; Maxwell Depo. Exh. 3 pp. 46-47) I. LOCAL REVENUE 1. PROPERTY CLASSIFICATIONS AND TAX ASSESSMENT a. For taxation purposes, real property in Ohio is divided into two classifications; Class I, which consists of residential and agricultural property and Class II, which consists of 311 other real property, including commercial, industrial, public utility and mineral. Tangible personal property used in business is treated as a separate category of property for tax purposes. (Maxwell Tr. 69) b. Real property is assessed for taxation purposes at 35 percent of fair market value. Fair market value is determined once each six years by reappraisal, updated in the intervening three year period. (Maxwell Tr. 70) c. Property taxes are assessed in mills; a mill is one thousandth of a dollar for each dollar of assessed valuation. Tax rates include: (1) voted millage, which is approved by vote of the electorate, and (2) unvoted or "inside" millage which is levied without a vote. Unvoted millage is limited to ten mills divided among the various taxing subdivisions. For school districts in Ohio, unvoted millage averages 4.6 mills. (Maxwell TR. 71) d. The amount of inside millage is related to histor- ical circumstances and unrelated to the cost o� operating a public school. (Russell Depo. 136) e. In order to determine the amount of local tax revenue to be received by a school district, it is necessary to know the value of real property by class and the value of tangible personal property in the district. It is also necessary to know the effective rate of taxation applicable to each class of property. Effective rates of taxation are determined by the Ohio Department of taxation and certified to the County Auditors of each county. (Maxwell Tr. 79-80; Maxwell Depo. Exh. 5) f. Charles W. Brown of the Department o� Education has observed a general trend toward an increase in local revenue and a decrease in state revenue as an over-all percent o� school district operating revenue. (Brown Depo. 30) g. Over the past six years, there has been a shift in the relative tax burden within Class I real property (residential and agricultural real property) in Ohio as residential values have increased at a faster rate than agricultural values. As a result, a relatively lower level of taxes is being paid by the agricultural sector than by the residential portion, while the amount received by the school districts is static due to application of tax reduction factors. (R.C. Section 319.301; Maxwell Tr. 245) h. The term "tax incidence" refers to the ultimate taxpayer. The type of property being taxed affects the ability to shift the tax burden to a taxpayer outside the district. (Porter Tr. 1057) i. From 1980 to 1990, there has been a growth in disparity in the ability of school districts to raise revenue locally. The distribution of assessed value of taxable property became more unequal as the 1980's progressed. (Porter Tr. 1065) j. The driving force behind the disparities in school funding is the growth in differences in the value of Class 2 real property among districts. The growth in inequity in the distribution of Class 2 property increased from 1981 through 1990 at a far greater rate than the growth in inequity in Class 1 property. (Fleeter Depo. 18) k. The top of the distribution of school districts by valuation per pupil is pulling away from the middle and the bottom. (Porter Tr. 1112) l. The coefficient of variation for assessed valuation shows a trend toward greater dispersion of valuation among Ohio school districts, both including and excluding the valuation of Perry Local Schools, the school district with the highest valuation in the state. (Porter Tr. 1081; Pl. Exh. 100, Table 2) m. From 1980 to 1990, the per pupil assessed value of taxable property in Ohio increased by $15,000, while the per pupil assessed value increased by a much smaller amount for each of the plaintiff school districts. In the case of Youngstown, the per pupil assessed value declined by nearly $15,000. As a result of slow growth or decline in property values, as well as a loss in adjusted gross income, the Plaintiffs' ability to raise local funds for the operation of schools has changed dramatically for the worse. (Porter Tr. 1110; Pl. Exh. 100 Chart 7) n. The Department of Education is not notified of challenges to property valuation and has no way of knowing if a challenge is filed for evaluation of any property. Only after an objection to an assessment has been ruled upon, and evaluation changes, is the department notified. In fact, the Department of Education is required to use the data that is certified to it from the Department of Taxation. (Payton Tr. 4922-24) o. Funds for public education which are gathered pursuant to state taxing laws are state funds, regardless of whether they represent the proceeds of local tax levies or the distribution of state tax dollars. (Alexander Tr. 3638) 2. HOUSE BILL 920 AND TAX REDUCTION FACTORS a. Amended Substitute H.B. 920 was enacted by the General Assembly in 1976 and limits growth of real property tax revenues which would otherwise occur through inflation in property values. (Stip. 14) b. House Bill 920 requires the application of tax reduction factors to voted property tax levies when property values are increased as the result of reappraisal, to the end that a school district will receive the same level of revenue from voted tax levies applied to its tax duplicate after reappraisal, as it did before reappraisal. Separate tax reduction factors are calculated and applied to Class I and Class II property. (Maxwell Tr. 73-74; Maxwell Depo. Exh. 3 p. 15) c. "Inside" or unvoted millage is not subject to a tax reduction factor and will produce additional revenue if property values increase. (Maxwell Tr. 74-77) d. But for the reductions in the effective rate of real property taxes required by House Bill 920, a total of $1.176 billion would have been levied for public school districts and joint vocational schools in Ohio in 1990 alone. (Maxwell Tr. 81; Pl. Exh. 7) e. As a result of the application of tax reduction factors, the school districts in the State of Ohio lost a total of $1.472 billion in real property tax revenue for the operation of public schools in FY92. (Sanders Tr. 321; Pl. Exh. 379) r. In FY92, the tax reduction factor had the affect of reducing property taxes state-wide by an amount of 26.12 percent. (Pl. Exh. 379) g. When reviewed on a district-by-district basis, the effects of H.B. 920 are varied and uneven among school districts depending on their proportion of real versus tangible property, how many inside mills the district has, the extent of new construction, whether the district is at or close to 20 effective mills in either Class I or Class II property, and the extent of increases in the values of real property. While H.B. 20 has resulted in an overall statewide average reduction of 26.1 percent, this reduction varies from a low of 0 percent for some districts to a high of 53.1 percent for others. (Pl. Exh. 13, pp. 7, 8) h. As a result of the application of tax reduction factors, the FY92 taxes in the Plaintiff School Districts were reduced by the following amounts: SCHOOL DISTRICT AMOUNT OF REDUCTION Dawson-Bryant LSD 4.33 % Lima CSD 17.57 % Northern LSD 21.34 % Southern LSD 22.48 % Youngstown CSD 7.42 % (Pl. Exh. 379) i. Although H.B. 920 limits school districts from receiving growth in local property taxes as values increase, individual taxpayers may actually see their taxes increase, depending on the changes in the value of their individual properties. (Maxwell Tr. 83-84; Maxwell Depo. Exh. 3 p. 27) j. H.B. 920 has resulted in a circumstance by which local revenues have not kept up with inflation unless the district has voted additional tax levies. Since the passage of H.B. 920, there have been over 3,700 school district tax levies. Wealthier districts have an easier time passing levies. (Russell Depo. 133; Shoemaker Tr. 4164; Pl. Exh. 13, Attachment D.) k. Senator Aronoff, a Republican, would approve legislation that would allow property taxes to rise in some fashion with inflation. However, Governor George Voinovich, also a Republican, is against this position. (Aronoff Tr. 4862) l. The operation of H.B. 920 is such that school districts with "brick and mortar" (new construction) growth will get additional revenue from an increase in value, while a district with growth solely due to inflation will not. (Russell Depo. 134) m. The complexities created by H.B. 920 are difficult for school districts to explain to voters. (Russell Depo. 140; Shoemaker Tr. 4163) n. The absence of growth in local school district tax levy revenue as a result of the application of tax reduction factors is considered a weakness in the school funding system by the State Board of Education. (Tavakolian Depo. 60; Tavakolian Depo. Exh. 3, p. 19) o. As a result of the limitation of H.B. 920, school districts have been required to propose more and more additional tax levies, with those levies being approved at an increasingly lower rate. (Taylor Depo. 283; Maxwell Tr. 247; Maxwell Depo. Exh. 9) p. Plaintiff's Exhibit 13 is an analysis of the operation of H.B. 920 prepared for the Governor by the Department of Education at the request of the Superintendent of Public Instruction to encourage the Governor to support changes in H.B. 920. Such support is not yet forthcoming and no such changes have resulted. (Sanders Tr. 322) 3. OPERATION OF THE TWENTY MILL FLOOR OF TAX RATE REDUCTION a. H.B. 920 sets a floor of effective tax rate reductions at twenty mills. That floor consists of a combination of effective voted millage and inside (unvoted) millage. (Russell Depo. 135) b. School districts that have reached the 20 mill floor of millage reductions in either class or real property do not have their effective rates reduced further. Those districts will realize additional revenue from any growth in the value of the tax duplicate and do receive additional revenue each time values are increased due to reappraisal or update. (Maxwell Tr. 75-76; Maxwell Depo. Exh. 3 p. 17; Russell Depo. 137) c. Identical school districts would receive different amount of local tax levy revenue from an equal increase in the valuation of real property depending on whether or not their effective tax rates had reached the twenty mill floor. (Russell Depo. 138; Pl. Exh. 13, pp. 4-5; Sanders Tr. 319) d. The Department of Education would advise a school district at the twenty mill floor to propose tax levies not subject to a tax reduction factor, such as emergency tax levies, in order to preserve their ability to realize growth in real estate valuation. Passage of such a levy would result in additional revenue without reduction. (R.C. Sections 319.301 and 5705.194; Russell Depo. 138) e. Phantom revenue is an aspect of the school foundation program by which a school district can receive an increase in the value of its tax duplicate but not actually receive any additional income from local tax revenues while, being subjected to a larger "charge off" in the basic aid formula due to the increased valuation. (Sanders Tr. 326) 4. OTHER TYPES OF TAX LEVIES AVAILABLE TO SCHOOL DISTRICTS a. Emergency tax levies are those producing specific amounts of dollar revenue for each year the levy is in effect. Emergency tax levies are not subject to the application of a tax reduction factor. A school district at the 20 mill floor of tax reduction could pass an emergency tax levy and receive not only the benefit of 20 mills times the full assessed value of the tax duplicate, but also the additional revenue produced by the emergency tax levy. (Revised Code Sections 5705.194 and 319.301; Maxwell Tr. 85-86) b. School district income taxes were first approved by General Assembly in 1981, later repealed and reauthorized in 1989. Unlike municipal income taxes, school district income taxes tax the income of school district residents and do not tax corporate or partnership income. (Maxwell Tr. 87) c. Of the approximately 93 school districts that have passed school district income tax levies for the operation of their schools, the vast majority have been school districts with low levels of commercial and industrial real property and tangible personal property. The income tax districts have primarily been rural school districts. (Maxwell Tr. 239) d. Incremental property taxes were authorized by the General Assembly in 1990. Incremental taxes can provide for growth in school district revenue but the incremental tax rates may be subject to separate tax reduction factors. Incremental tax levies are difficult to pass because of complex ballot language. (R. C. Sections 5705.212 and 5705.213; Maxwell Tr. 88-89) e. Replacement tax levies were authorized by the General Assembly in 1992. Replacement levies permit the replacement of an expiring tax levy that has been reduced by application of tax reduction factors with a new levy at the full voted rate. (R.C. Section 5705.192; Maxwell Tr. 89 -91) f. Because of the need to create a substantial fund of money at the time of constructing a school building, most school district facilities are constructed following the passage of a voted bond issue. In some instances, where eligible, that voted bond issue may include Classroom Facilities Act assistance. (Phillis Tr. 1685) 5. SCHOOL DISTRICT INCOME AND ITS EFFECT ON LOCAL a. School districts having high levels of property valuation per pupil also have high levels of income of residents in the districts. (Pl. Exh. 302, p. 15) b. From 1980 to 1990, the relationship between personal income of residents and assessed valuation of property increased, meaning that school districts with high levels of personal income tended, to a greater degree, to also have higher levels of taxable property. At the same time, low income districts tended more and more to have lower levels of non-residential taxable property and thus, less ability to export the tax burden outside their borders. (Porter Tr. 1066) c. From 1980 to 1990, after adjusting for inflation and district size, the poorest 200 Ohio school districts had a lower level of adjusted gross income in 1990 than in 1980. (Porter Tr. 1069; Pl. Exh. 100) d. From 1980 to 1990, the middle group of school districts also lost income. (Porter Tr. 1070; Pl. Exh. 100) e. From 1980 to 1990, there was modest growth in assessed value per pupil for low income districts while there were dramatic increases in assessed value per pupil in high income (top 200) districts. (Porter Tr. 1072; Pl. Exh. 100, Chart 2) f. From 1980 to 1990, the level of assessed value per pupil of non-residential property changed little for the low income and middle income districts while the high income districts experienced substantial growth. As a result of the shift in taxable value, high income districts attained an advantage in the ability to shift the incidence of school tax to taxpayers outside the district. (Porter Tr. 1073; Pl. Exh. 100, Chart 3) g. High income districts now have an advantage in shifting their tax burden outside the district, whereas in the past, low income districts had that advantage. (Porter Tr. 1112) h. From 1985 to 1990, the distribution of adjusted gross income among Ohio's school districts underwent a rapid change, becoming increasingly disparate as measured by changes in the coefficient of variation. (Porter Tr. 1076-77; Pl. Exh. 100. Table 1) i. Correlation coefficients measure the strength of the relationship between two variables. There is a relationship between income and assessed valuation and that relationship has become increasingly stronger since 1980, indicating an increasing likelihood that a district with high levels of income will also have high levels of taxable property valuation. (Porter Tr. 1085; Pl. Exh. 100 Table 3) j. Despite the fact that low income districts are increasing their rate of tax levy millage at nearly the same rate as high income districts, the local revenues generated in the high income districts have increased dramatically relative to the increases in revenue in low income districts. (Porter Tr. 1088; Pl. Exh. 100, Table 5) k. From 1980 to 1990, the dispersion of income among Ohio school districts has become substantially more unequal, while the distribution of assessed value has also become more unequal. In addition, the relationship between assessed value and income has become stronger, indicating that districts with higher income are now more likely to have higher levels of assessed value. (Porter Tr. 1111 ) l. The adjusted gross income for each of the plaintiff school districts declined from 1980 to 1990, while the state average showed a slight. increase over the same period. In the case of Youngstown, adjusted gross income per return filed by district residents fell by nearly $4,000.00. (Porter Tr. 1109; Pl. Exh. 100 Chart 6) m. The 1989 federal adjusted gross income per return filed by district residents and state rank for the Plaintiff districts is as follow: DISTRICT AMOUNT RANK Dawson-Bryant LSD $20,838 578 Lima City SD $22,209 516 Northern LSD $23,119 461 Southern LSD $19,245 607 Youngstown CSD $19,538 603 (Pl. Exh. 338) 6. LOCAL TAX LEVIES a. Stipulation Exhibit 9 is a true and accurate depiction of the total number of school district tax levies proposed, and the number of those levies approved and rejected by the voters of Ohio, �or each year �rom 1984 through 1992. (Stip. 6; Stip Exh. 9) b. Pl. Exh 317 is a document showing the number of school district operating levies which were proposed, passed and failed in the State of Ohio from November 1962 through November 1990. (Pl. Exh. 317; see also Pl. Exh. 400) c. In 1983, 55 percent of the operating levies proposed in the State of Ohio passed. In 1991, that figure had declined to 47.6 percent passed. (Pl. Exh. 379) d. Stipulation Exhibit 10 depicts the Plaintiff School Districts' tax levies from 1980 through the spring of 1993 and the corresponding results, except for the Plaintiff Youngstown City Schools. (Stip. 7; Stip. Exh. 9) e. The levy history for the Youngstown City Schools is as follows: November, 1983, 7.9 mill operating levy failed; June 1983, 7.9 mill operating levy failed; May, 1988, 4.98 permanent improvement levy failed; November, 1988, 14.5 mill levy passed. There was an attempt to repeal the 14.5 mill levy, but the repeal failed and the levy stayed in place. That levy is a five-year operating levy and will expire shortly. (Marino Tr. 3200; Stipulation Exhibit 10 is incorrect for Youngstown City Schools) f. The passage of an additional local tax levy is the only method by which a school district can substantially increase its operating revenue, with the exception of possible equity money.(Brown Depo. 41, Aronoff Tr. 4855) g. A school district property tax levy in excess of 10 mills has very little chance of passing except in dire circumstances. (Brown Depo. 215-16) h. The assumption of primary responsibility for the passage of tax levy issues and bond issues often falls to the superintendent of Ohio's school districts. The activities undertaken in connection with that responsibility are often very time consuming. (Van Keuren TL^. 2724) i. Superintendent Sanders has expressed the concern that so many of Ohio's superintendents are spending their precious time dealing with finances, passing levies and playing community politics instead of giving leadership to the improvement of learning. (Pl. Exh. 32, 1). 4) j. It is difficult for school districts in Area 5, the area which includes Plaintiff Dawson-Bryant Local Schools, to increase local revenues because property tax levies are difficult to pass. People are reluctant to vote on tax issues. Even if property taxes are passed in lower wealth districts, it does not raise a large sum of money because the property valuation just simply is not there. (Taylor Depo. 145-46) k. It would be difficult for the residents of Plaintiff Dawson-Bryant Local School District to pay an equal number of mills as the residents of the Beachwood City School District. (Taylor Depo. 279-80) l. The Beachwood City School District levies approximately 25.9 effective mills. The state mean millage is 30.1 mills (McMurrin Tr. 2619) m. Mr. Roger Miller, a life-long resident of Lima City Schools, has watched the finances of the district and various levy issues over the last 20 years. During that time, the district has not lost a levy other than one income tax proposal. The passage rate of levies had risen to 70 percent positive and 30 percent negative. Over the last several years, however, that percentage has dropped down into the 60 percent and 50 percent range. The last levy in 1990 passed by only a handful of votes. The district is in the precarious situation of losing the ability to gain voter approval of tax levies. (Roger Miller Depo. 73-74) n. Voters in Plaintiff Northern Local School District have rejected several recent levy proposals, and many voters have stated that they reject the proposals because school district tax proposals are some of the few tax raises that voters have an opportunity to oppose. (Hill Depo. 35) o. Increasing revenues by voter approval of local tax levies is not an option for Southern Local. In one year, the cost of benefits for employees went up $93,000, which would take 4 mills of local property taxation to generate. In 1989, the voters of the district approved an operating levy of 3.9 mills and the following year approved a facilities bond levy for 7 percent of the valuation of the district. At about the same time, the major employer in the district went out of business. Most of the families in the district qualify for free or reduced lunch benefits, an acknowledgment by the federal government that they cannot even pay for lunch. Industry is very limited in the district, and the reported average family income is currently approximately $18,000. There is no income base and there is no property base at Southern Local with which the district can increase its local revenues. (Spangler Tr. 48183) p. For a board of education to try to pass a levy may cost from a few hundred dollars to two thousand dollars to pay election expenses. (Spangler Tr. 483) Because one mill raises so little in districts with low assessed valuation per pupil, those districts have very little to promise the voters in exchange for passing additional millage. (Spangler Tr. 483) Public trust and support is defeated by returning to the voters to ask them for additional millage when they cannot afford to pay. (Spangler Tr. 484) q. In 1988 at Youngstown City Schools, there was significant community involvement and effort to pass a 14.5 mill operating levy. At that time, there was some industry to support payment of the millage, but due to plant closings, the amount of commercial property has declined since that time. (Marino Tr. 3186, 3200-02) 7. LOCAL TAX EFFORT a. Taking into account both the value of assessed property and the adjusted gross income as combined measures of ability to pay taxes, the poorest 200 school districts in Ohio actually exerted a greater level of tax effort in 1990 than the wealthiest 200 school districts. (Porter Tr. 1105-1106; Pl. Exh. 102 Table 2) b. Tax effort has very little to do with the variations in local school district revenue. If all wealth is considered, the correlation is negative; if only residential property and income is considered, the correlation is zero. (Porter Tr. 1107) c. Fiscal effort between the top and bottom deciles of assessed valuation per pupil indicates that although there is a revenue and expenditure disparity, the level of effort between the rich and poor is virtually uniform. (Alexander Tr. 3667-68; Pl. Exh. 301 p. 51) d. Ohio's funding system puts so much of the burden on the local property tax level as to invite disparities. Although one would expect poor districts to put forth lower effort because of the marginal value of the dollar, in fact, poor districts are making as much effort in Ohio as rich districts. (Alexander Tr. 3669-70) e. The disparities in school district revenues and expenditures are not related to the tax effort of the school districts but rather are related to disparities in wealth. (Alexander Tr. 3673) f. The variation in millage and tax effort measured in other ways is too small to explain the variation in local revenues. The difference in local revenues raised is more due to unequal distribution of assessed value than it is to effort. (Porter Tr. 1112) g. A comparison of the Plaintiff school districts paired with similarly sized "high capacity" school districts indicates that it would require a levy of 318.6 mills for the Dawson-Bryant Local School District to raise the same level of revenue that the Beachwood City School District is able to raise with 31.8 mills; Southern Local Schools would be required to levy 155.8 mills to raise the same level of revenue that the Richmond Heights local school District can raise with 37.4 mills; Youngstown City Schools would be required to levy 94.4 mills to raise the same revenue that Mayfield City Schools can raise with a levy of 29.4 mills; Lima City would have to levy 50.8 mills to raise the same level of revenue that the Worthington City Schools can raise with 31.2 mills; and the Northern Local Schools would have to levy 44.6 mills to raise the same revenue that Revere Local can raise with 29.0 mills. (Maxwell Tr. 66; Maxwell Depo. Exh. 3, p. 4) 8. THE EFFECT OF LOCAL TAX ABATEMENTS AND EXEMPTIONS, ZONING LAWS AND ECONOMIC CLIMATE a. Stipulations 50 through 52 deal with the exemption and abatement of real property from taxation. Stipulation Exhibit 27 sets forth the extent of exemption and abatement from taxation of real property in each of the Plaintiff school districts. b. Revised Code Section 3317.022, as effective July 26, 1991, provides that if more than twenty-five percent of a district's potential assessed value is state-exempted property, the district is entitled to a recalculation of its basic aid and will receive additional funds if any basic aid funds remain at the close of the fiscal year. As of August 30, 1993, no school district has received any additional funds by reason of this provision. (Stip. 52) c. "Rollback" reimbursement represents payment by the state for reductions in school district property tax revenue. The rollback amount is 10 percent of the property tax revenue that would have been received by the school district but for the reduction. In addition to the rollback exemption, there is an additional exemption of 2-1/2 percent of property taxes for qualified elderly residents, known as the "homestead exemption." Amounts of property taxes lost to school districts by reason of these exemptions are made up through the provision of funds from the State. These funds are included in State's education budget. (R. C. Section 319.302; Maxwell Tr. 125-26) d. Real property in every school district in the state has been exempted or abated from taxation based on one or more provisions of the Revised Code. (Stip. 50) e. Public school districts have no control over the exemption and abatement of taxable value of property in their districts. (Russell Depo. 87; Shoemaker Tr. 4164-65) DAWSON-BRYANT f. There is very little industry in the Dawson-Bryant School District and surrounding region. Most of the people who reside within the school district that have employment, work outside the district and, in many instances, outside the state. Average income in the district is quite low compared to other districts in the state. (White Tr. 2072-73) The largest employer within the Dawson-Bryant Local School District is the school system. (White Tr. 2074) g. The residents of Dawson-Bryant passed a 5.9 mill levy in May of 1993. Because there is no industry in the district, the tax is placed directly upon residents, whose income level averages approximately $21,000 per year. Twenty-five percent (25%) of the district' 9 students are ADC recipients, more than 50 percent of the students qualify for free lunch, and additional students qualify for reduced lunches. Obviously, residents of the district do not have discretionary income to pay additional taxes. Thus, a tax levy for operation is not a viable option. (Washburn Tr. 2382-85) h. The number of mobile homes in the district have increased from 257 in 1988 to 456 in 1993. The average annual taxes paid per mobile home for 1993 is only about $39.24 per year. (Stip. Exh. 27, #1) LIMA a. The general population of the suburban area around the City of Lima has grown slightly over the past ten years, while the population within the city has declined. Of the population decline over the past ten years, 85 percent is represented by individuals under the age of 18 who are white. As a result of the population shifts, demographics of the Lima City School District have continued to change to the end that school districts contiguous to the City of Lima have grown substantially, with one having grown over 200 percent since 1974. (Buroker Tr. 2872-73) b. People who move into the Lima City School District tend to be people who are moving to take advantage of low-income housing. As a result, the individuals who attend the Lima City Schools tend to be poor. (Buroker Tr. 2873-74) c. Lima City School District has not proposed the passage of additional tax levies to its voters because it has one of the lowest tax bases and one of the lowest per capita incomes of any school district in the State of Ohio. The tax payers of the district are already assuming a significant burden. In addition, the voters of the city experience municipal overburden charges through the requirement that they pay for the services of water, sewer, and police protection. Thus, the existing tax burden, combined with an ever increasing population living below the poverty line, makes the prospect of passage of an additional tax levy unlikely. (Buroker Tr. 3075-76) NORTHERN LOCAL d. Plaintiff Northern Local School District has experienced a rapid increase in enrollment due in part to zoning laws which allow existing farmland to be split into small tracts for mobile homes. (Hill Depo. 48) e. During the last seven years, families moving into the Northern Local School District have been lower income families, and the ability of the district's residents to pay additional taxes has decreased. (Dilbone Tr. 2047-48) f. In addition to the rapidly increasing enrollment in Plaintiff Northern Local School District, mobile homes hurt Plaintiff Northern Local School District's local tax receipts because mobile homes are taxed at a different rate than real property. (Hill Depo. 48) g. Mobile homes in a school district create special problems for the school district. Mobile homes are taxed at a lower rate than permanent structures. A 3-bedroom mobile home will most likely yield about $60 per year in taxes, where a 3-bedroom permanent house will probably yield between $150 and $300 per year in taxes. In addition, mobile homes bring numerous students into a particular district without bringing the tax revenue to support those students. (Shoemaker Tr. 4177-78) h. The number of mobile homes in the Northern Local School District taxed by the Perry County Auditor have increased from 542 in 1988 to 755 in 1993. The district has collected amounts ranging from about $27,031 per year to about $41,224 per year on those mobile homes. (Stip. Exh. 27, #3) SOUTHERN LOCAL i. The economic situation in Southern Perry County and in Plaintiff Southern Local School District is poor. Employment is scarce, companies have closed their doors, and some of the larger employers in the county, coal businesses, have ceased operations. At one time the railroad was the major employer in the county, but it has closed its operations. (Altier Tr. 1289; Spangler Tr. 442-43) j. The total assessed property valuation of Southern Local is approximately $25,000.00, which is about $23,000 per pupil. (Spangler Tr. 444) k. In his position as Chairman of the Corning Bank, Mr. Altier has observed that the delinquent list of defaulted commercial and home loans grows every month. Repossession is much more frequent than it used to be. Bankruptcies have increased. (Altier Tr. 1291) l. Large purchases of tracts of land have been made by the federal government in the Wayne National Forest, located in Plaintiff Southern Local School District. The federal government does not pay any taxes on this property. (Altier Tr. 1291-92) YOUNGSTOWN m. The Youngstown City School District's local revenue has been hurt by the economy of the Youngstown area. The Youngstown business community has been devastated since the steel mills closed down, and the city of Youngstown has given tax abatements to industry in an attempt to draw business to the area. The combination of the steel mills closing and the abatement process has had a detrimental impact on the Youngstown City School District's financial projections. (Hiscox Depo. vol 1, 37; Kolitsos Depo. 26, Marino Tr. 3186) n. The Select Committee to Review and Study Ohio's Education System heard testimony from the Superintendent of the Youngstown City Schools that the Youngstown-Mahoning Valley area lost 40,000 jobs between 1977 and 1987, resulting in income loss to employee wage earners and loss of personal tangible property value throughout the area. (Shoemaker Tr. 4065) o. The plant closings in Youngstown have made it very difficult for the school system to function. The closings have caused tremendous unemployment, increased numbers of people on ADC, increased numbers of students on free or reduced priced lunches, increased numbers of single-parent families, increased latchkey situations, increased numbers of neglected children, and many people are functioning on a survival basis with food, clothing, and shelter needs. (Marino Tr. 3185-86) p. The total value of abated property in the Youngstown City School District grew from $4,073,310 in 1888 to $16,928,920 in 1992. Property in the district, exempt from taxation, was valued at $159,023,950 in 1992. (Stip. Exh. 27, #5) q. In the Youngstown City School District, between tax year 1978 and 1987, the total assessed property value fell from slightly over $1 billion to $606 million, measured in 1990 dollars. By the 1990 tax year, total assessed value had fallen to $547 million. (Pl. Exh. 108, p. 1) r. In Plaintiff Youngstown City School District, 1 mill of taxes raised about $62 for each student in 1979, $41 in 1987, and only $37 in 1990. (Pl. Exh. 108, p. 1) s. The average daily membership (ADM) of the Youngstown City Schools has declined by about 1,866 students from 1982 to 1992. (Stip. Exh. 8) The decline occurred because there is very little work available, businesses are not successful, and Youngstown is not a safe place to raise a family. People try to stay out of Youngstown, and very few people drive through it because they are afraid. People do not come into the city. Those who can, move out of Youngstown and go to surrounding suburbs and other places. (Marino Tr. 3193-94) J. REVENUE AND EXPENDITURE DISPARITIES THROUGHOUT OHIO 1. Plaintiffs' Exhibits 384-934 are Cost Per Pupil books published by the Ohio Department of Education for FY91 back to FY81, which detail the costs incurred by each of Ohio's public school districts for a given fiscal year. These publications are sent out to every school district in the state of Ohio, the Ohio Department of Education, the General Assembly and anyone else in the general public who requests them. The data contained therein are generated from the core of data maintained by the Ohio Department of Education and are presented by the Department as being an accurate and reliable representation of what is actually happening to the school districts in the state of Ohio. Mr. Daubenmire, Assistant Director of Programming and Data Collection for the Department, believes the data contained in the Cost Per Pupil books to be good data. (Daubenmire Tr. 5015-19) 2. Levels of assessed value per pupil are highly correlated with levels of spending per pupil. (Porter Tr. 1113) 3. There is a strong correlation between assessed valuation per pupil and total expenditures per pupil. With special needs money removed from the analysis, the correlation becomes even stronger. Roughly half of the variation in spending can be statistically traced to variations in assessed value per pupil. (Porter Tr. 1098-99; Pl. Exh. 100, Table 8) 4. The difference is expenditures between high and low valuation districts has increased during the period between 1981 and 1990. (Porter Tr. 1092; Pl. Exh. 100 Chart 5) 5. The top 200 school districts in Ohio ranked by assessed value per pupil spend more than $1,000 more per pupil per year than the bottom 200 school districts. (Porter Tr. 1095; Pl. Exh. 100, Chart 6) 6. There is, in general, a greater degree of dispersion in spending among Ohio's school districts in 1990 than there was in 1981. (Porter Tr. 1095; Pl. Exh. 100, Table 7) 7. The differences in spending among Ohio school districts are primarily due to differences in the value of the tax bases of those districts rather than the tax effort of the voters. (Porter Tr. 1108) 8. If the per pupil spending in Plaintiff Northern Local School District was increased from the current $3,000 per pupil to the state average of approximately $4,500 per pupil, it would require an additional $3 million in revenue. The school district would have to levy approximately 30 mills in addition to what is already levied in order to bring the school district's per pupil spending up to the state average. (Johnson Tr. 1485) 9. The Beachwood City School District has an average valuation per pupil of approximately $288,000.00. (McMurrin Tr. 2499; Pl. Exh. 270) Beachwood spent approximately $11,422.00 per pupil in FY92. (McMurrin Tr. 2597) 10. For the 1991-92 fiscal year (FY92), Ohio's average expenditure per pupil was $4,900, which was less than the national average expenditure per pupil of $5,170. (Pl. Exh. 12, p. 51) 11 It would take Plaintiff Dawson-Bryant Local School District 33.65 school districts additional mills to raise its expenditure per pupil up to the FY91 state average of $4,585. It would take Plaintiff Northern Local School District 29.21 mills to raise its expenditure per pupil up to the state average of $4,585. (Pl. Exh. 381) 12. In FY91, 5 percent of the pupils having the benefit of the greatest assessed valuation of property in the state (representing approximately 95,000 students) had an average of $171,228.44 of taxable valuation per pupil available for the support of their educational programs. Plaintiff Dawson-Bryant Local School District had $21,000 in wealth, Lima City School District had $36,000 in wealth, Northern Local had $38,000 in wealth, Southern Local had $24,600 in wealth, and Youngstown had $36,646 in wealth per pupil for the support of their educational programs. (Alexander Tr. 3641-42; Pl. Exh. 301, Chart 1, p. 2) 13. Ranking all pupils in the state into decile rankings based on assessed valuation per pupil for FY91, shows that the pupils in the top decile have an average of $146,069 per pupil available for the support of their education, while the pupils in the bottom decile have $32,918 in per pupil valuation available for the support of their educational programs. (Alexander Tr. 3643; Pl. Exh. 301, Chart 2, p. 3) 14. In 1981, the wealthiest 30 percent of the pupils in the state had 43.6 percent of the assessed valuation for the support of their education, while the poorest 30 percent of the pupils had available 19.4 percent. By 1992, the wealthiest 30 percent of the pupils had 45.93 percent of the wealth available for the support of their education, and the poorest 30 percent of the pupils had la.17 percent available. (Alexander Tr. 3644-45; Pl. Exh. 301, Chart 3, p. 4) 15. In 1981, the top decile of pupils ranked in order of assessed valuation per pupil had 18.06 percent of the wealth, while the bottom decile had 5.14 percent. By 1992, the top decile had increased its share of the wealth to 20.76 percent, while the bottom decile decreased to 4.83 percent. (Alexander Tr. 3645; Pl. Exh. 301, Charts 4 and 5, pp. 5-6) 16. For the 1990-91 school year, the top 10 percent of the pupils ranked in order of assessed valuation per pupil had available an average adjusted gross income of $130,000 per pupil, while the bottom decile had an average adjusted gross income of $42,654 per pupil. In general, pupils in school districts with higher levels of assessed valuation of property also have higher incomes. (Alexander Tr. 3647; Pl. Exh. 301, Chart 6, p. 7) 17. The differences in assessed valuation of property and differences in income result in differences in levels of revenue available for the education of pupils. The inequities flowing from these circumstances are created by the state's system of funding education. (Alexander Tr. 3649) 18. For FY91, 500,000 pupils in the wealthiest 30 percent of Ohio school districts had substantially greater amounts of revenue combining state and local sources than did the poorest 30 percent. (Alexander Tr. 365051; Pl. Exh. 301 p. 15) 19. For FY91, in local revenue only, the wealthiest decile of pupils had an average of $4,471.00, while the poorest decile had an average of $986.22 available for their education. (Pl. Exh. 301, p. 17) 20. For FY91, 10 percent of the richest pupils in the state had instructional expenditures per pupil averaging $3,358.76, while the instructional expenditures per pupil for Dawson-Bryant were $1,989.38; for Lima City, $2,603; for Northern Local, $1,911.35; for Southern Local, $2,272.59; and for Youngstown City, $2,862.23. (Pl. Exh. 301, p. 23) 21. For FY91, substantial differences existed between the top and bottom deciles of pupils' regular instructional expenditure, with the highest decile spending $2,688.00 per pupil, while the lowest decile spending $1,734.00 per pupil. (Alexander Tr. 3656; Pl. Exh. 301 p. 26) 22. Unadjusted expenditures are those that do not involve a proration back of funds from the county office or c-- sites (centralized date processing sites). Unadjusted total current expenditures for the wealthiest 10 percent of the districts in FY91 averaged $5,945 per pupil, for Dawson-Bryant Local School District, $3,498.73; for the Lima City School District, $4,120; for the Northern Local School District, $3,205; for the Southern Local School District, $3,810; and for the Youngstown City School District, $4,956. (Alexander Tr. 3661-62; Pl. Exh. 301, p. 40) 23. For the 1990-91 school year, the wealthiest 30 percent of Ohio's pupils had the benefit of a substantially higher level of the non-adjusted current expenditures per pupil than did the poorest 30 percent. (Alexander Tr. 3663; Pl. Exh. 301, p. 41) 24. Comparing the Plaintiffs with the wealthiest school districts, the adjusted total current expenditures per pupil for FY91 for the wealthiest school district was $6,078.36; Dawson-Bryant, $3,860.91; Lima City, $4,126.27; Northern Local, $3,453.13; Southern Local, $4,435.39; Youngstown City $4,956.69. (Pl. Exh. 301, p. 42) 25. The same comparison applied to the top and bottom deciles of pupils indicated that the top decile had adjusted current expenditures per pupil of $5,480, while the bottom decile had adjusted current expenditures per pupil of $4,017. (Pl. Exh. 301, p. 43) 26. The same disparities evidenced in adjusted and unadjusted expenditures per pupil were also manifested to an even greater degree in the areas of capital outlay and debt service per pupil for FY91. (Alexander Tr. 3664; Pl. Exh. 301, pp. 44(a) and 45) 27. The analyses in Plaintiffs' Exhibit 302 compare revenue and expenditure patterns between groups of school districts representing 5 percent increments of the state's pupil population, with approximately 91,000 pupils in each group. (Alexander Tr. 3704) 28. The comparisons set forth in Plaintiff's Exhibit 302 demonstrate the revenue disparities between rich and poor school districts, the valuation disparities, and the differing expenditures by category. (Alexander Tr. 3704) 29. Plaintiff's Exhibit 302 at page 20 is an analysis at 5 percent intervals of the revenue receipts of all Ohio school districts ranging from wealthiest to poorest. (Alexander Tr. 3708; Pl. Exh. 302, p. 20) 30. FY91, the 20 percent of Ohio's pupils in the wealthiest school districts received 24.46 percent of state and local revenue receipts, while the 20 percent of Ohio' 9 pupils in the poorest school districts received only 16.79 percent of state and local revenue. (Alexander Tr. 3710; Pl. Exh. 302 p. 23) 31. Assuming 25 pupils per classroom for FY91, Cuyahoga Heights Local School District had $271,000 per classroom unit, while Huntington Local had only $77,000 per classroom unit, for a difference of $193,850 per classroom. (Alexander Tr. 3712; Pl. Exh. 302(a)) 32. Plaintiffs' Exhibit 210 is a series of four charts representing comparisons of various expenditures in plaintiff school districts and other school districts of similar pupil populations in Ohio. Plaintiffs' Exhibit 210 is a true and accurate summary of information contained in Ohio Department of Education computer printouts, which were admitted into evidence as Plaintiffs' Exhibit 205-209 for FY87 through FY91. As demonstrated by Plaintiffs' Exhibit 210, in FY91, each of the plaintiff school districts spent substantially less money on regular instruction, pupil support services, instructional staff services, transportation, and extracurricular sports than the districts with which they were matched. There was no match made with Youngstown City School District because there is no wealthy school district in the state the same size as Plaintiff Youngstown City Schools. (Pletcher Tr. 2640; Pl. Exh. 210; Pl. Exh. 205-209) 33. Plaintiffs' Exhibit 148 is a true and accurate summary of information contained in the state vital statistic's program for FY83 through FY92. (Pletcher Tr. 2641; Pl. Exh. 148, 149) 34. The trend in the difference between total state revenue per pupil and total state expenditures per pupil for FY83 to FY91 has been as follows: STATE AVERAGES: COMPARISON OF TOTAL REVENUE PER PUPIL AND TOTAL EXPENDITURES PER PUPIL FY1983-FY1991 TOTAL REVENUE PER PUPIL GENERAL FUNDS TOTAL EXPENDITURES PER PUPIL GENERAL FUNDS DIFFERENCE FY1983 $2,452.47 $2,289.41 +163.06 FY1984 2,714.37 2,551.80 +162.57 FY1985 2,803.47 2,747.19 +56.28 FY1986 3,011.90 2,975.33 +36.57 FY1987 3,251.30 3,177.01 +74.29 FY1988 3,454.10 3,379.00 +75.10 FY1989 3,733.31 3,694.66 +38.65 FY1990 4,009.41 3,961.04 +48.37 FY1991 4,152.37 4,159.20 -6.83 (Pl. Exh. 148) K. FEDERAL FUNDS 1. Federal funds were excluded from Mr. Maxwell's study because the vast majority of those funds are earmarked for specific programs. (Maxwell Tr. 167-168) 2. Approximately 5 percent of the total dollars provided for the funding of elementary and secondary schools are federal dollars. The majority of the federal dollars are provided through a program known as Chapter I, which provides funds for the remediation of pupils in eligible schools. The Department monitors the usage of these funds. (Van Keuren Depo. 14-16) 3. Chapter I funds flow, generally, to less wealthy school districts and are restricted to reading, math, and language improvement programs, focused on the elementary level. (Van Keuren Depo. 21) L. EQUITY FUNDS 1. Substitute H.B. 671 was enacted on June 30, 1992. The bill provided for the distribution of approximately $45 million in equity funds to the poorest 218 school districts in Ohio in FY93 only. (Stip 16; Stip. Exh. 15) 2. As of March 22, 1993, 21 of the school districts that received equity funds under H.B. 671 had applied for emergency school assistance loans. As of that date, fourteen of those districts had been certified as having an operating deficit and had either been approved by the state controlling board for receipt of a loan or had their certification pending. Plaintiff Youngstown City School District received over $2.1 million in equity funds, and was certified as having an operating deficit of $7.047 million. (Pl. Exh. 225; Stip. Exh. 16) 3. If the school districts to whom the equity funds were distributed, many of those had to use those equity funds to repay spending reserve loans the districts were forced to obtain, or to repay emergency assistance loans they were forced to take out because of cuts in state aid. (Brown Tr. 5490) It was the actions by the state of Ohio that forced some of these school districts to borrow against spending reserve and, in some cases, to enter the loan fund or increase the amounts they were going to borrow under the loan fund. (Brown Tr. 5491) 4. The formula by which equity funds are calculated and distributed includes both consideration of property valuation and income. The formula for the distribution of State Basic Aid includes only property valuation, without consideration of income. The amount of equity funds distributed to public school districts in FY93 represented less than 1 percent of the total foundation program expenditure and less than one-half of one percent of the total expenditure for public elementary and secondary education. (Maxwell Tr. 122-123) 5. The legislation for distributing the equity fund money is permanent law, but it takes an annual appropriation to create the funds. School districts in Area 5 tried not to use equity funds for salary and fringe benefits, because they could not depend upon the funds. (Taylor Depo. 158-59) 6. Equity funds were first placed in the budget at the recommendation of the Governor, not the State Board of Education or the Department of Education. The purpose of the equity fund was to target funds to low-wealth districts (Russell Depo. 55) 7. Equity funds in the current budget include $60 million in the first year and $75 million in the second year. An additional $15 million will be provided in the form of technology equity under a formula providing for distribution of the greatest amounts to the poorest districts. (Sanders Tr. 4482-4483) 8. Equity funds for FY93 were equal to $45 million; for FY94, the budget proposes $60 million in equity funds; and for FY95, the budget proposes $75 million. For 1994, the $60 million represent less than 1 percent of the state budget for primary and secondary education. For 1995, the same holds true. (Browning Tr. 4406; Stip. 20) 9. For 1994, the $60 million in equity funds will be divided among 342 school districts, and for 1995 the number of school districts will be essentially the same. Director Browning testified that he could not give any assurance that any funds will be available for equity payments to any of these 342 school districts, after July 1, 1995. He testified: "We cannot appropriate beyond the biennium." (Browning Tr. 4407-08) 10. The inequities in the funding of public education in Ohio school districts continued to exist after the passage of the first equity distribution and will continue to exist after the current biennial budget distributions in FY94 and FY95. The Department of Education does not know how much additional money will be necessary to bring equity to the funding of public education. (Russell Depo. 56) 11. It is very important for school districts to have stability in their financial planning, and also to be able to predict with a high level of certainty continued receipt of funds. (Brown Tr. 5512) One of the purposes of equity funds was to provide poor school districts with greater educational opportunities. However, for a number of the poorer school districts, like Plaintiff Southern Local School District, these equity funds, coupled with significant expenditure reductions by the school district, have just kept the district from increased borrowing. (Brown Tr. 5512) 12. The money put toward equity fund payments to school districts would have been better spent if it had been put into increasing the basic aid level. (Shoemaker Tr. 4186) 13. The reason for the current distribution of equity money is that legislative leadership wanted an equity formula that would give the money to 218 districts, approximately the same number of school districts that had been exempted from the budget cuts in early 1993. (Tavakolian Depo. 218) DAWSON-BRYANT 14. Seventy percent of the equity funds received by the Dawson-Bryant Local School District did not go to any new purchases or additional staffings, but rather $186,000 of the equity funds in FY93 was spent for health benefit costs. (Washburn Tr. 2379) 15. For FY94, Dawson-Bryant is holding the equity fund money it received to finish the year in the black because health care costs are unknown. The only purchase out of those funds to be a new math series for students in grades 1 through 8. (Washburn Tr. 2381-82) NORTHERN LOCAL 16. In FY93, Plaintiff Northern Local School District received approximately $183,000 in equity funds. These funds were used by the district to purchase modular classrooms, to hire the additional teacher needed to bring the district into compliance with the mandated 25 to 1 pupil to teacher ratio and to otherwise stay in the black financially. (Johnson Tr. 1474; 1393) SOUTHERN LOCAL 17. Plaintiff Southern Local School District received $289,000 in equity funds in FY93. (Stip. Exh. 17) Southern Local used its equity funds to meet normal operations of the school district, including $200,000 to meet two payrolls. The district purchased a few textbooks, but could not meet the text book and instructional material purchase plans. The district purchased one school bus, but the district needed to purchase two to three buses per year. (Spangler Tr. 496, 501) 18. Equity funds for Southern Local have nearly matched what the district was projected to borrow, so that funds have kept the district from operating in a deficit. (John Winnenberg Tr. 1234) YOUNGSTOWN 19. Equity funds received by Youngstown City schools in FY93 helped to keep the district from borrowing money through the emergency school assistance loan fund. (Marino Tr. 3414) 20. Plaintiff Youngstown City School District received $2.1 million in equity payments from H.B.671. That money was spent to help reduce the Youngstown deficit from $7 million to $5 million. The district did not purchase any new equipment, supplies, materials or textbooks with that equity money. (Hiscox Depo. vol 2, 83; Hiscox Depo. Exh. 25) M. STUDY PERFORMED BY HOWARD FLEETER 1. In the Spring of 1991, a representative of the Governor's office contacted the director of the School of Public Policy at Ohio State University regarding the conduct of a study of school funding in Ohio. Dr. Fleeter was involved in those discussions, which resulted in a proposal for the conduct of such a study being submitted and approved. The study, funded by a grant from the Cleveland Foundation, took place over the summer and fall of 1991 and resulted in a written report to the Governor's Education Management Council submitted in November, 1992. (Fleeter Depo. Vol. 1, pp. 22-24) Fleeter Depo. Exh. B and Pl. Exh. 344 is Dr. Fleeter's report. 2. Dr. Fleeter's report was used by the Department of Education in the formulation of budget and policy recommendations to the 120th General Assembly. (Pl. Exh. 15) 3. Dr. Fleeter presented his report at an education summit in December of 1992. (Fleeter Depo. 79) The findings of Dr. Fleeter's report, as commissioned by and reported to the State of Ohio are as follows: a. A "good" education financing system must be equitable, but it must also ensure both the availability of an adequate level of resources to all districts and that this flow of resources is reliable in a dynamic and long-term sense. (Fleeter Depo. 1) b. The equity problem challenging Ohio is essentially characterized by the significant imbalance in local tax base apparent across the state's wealthy and poor school districts--particularly that related to real and tangible business property wealth. (Fleeter Depo. 3) c. Because income and property wealth is not uniformly distributed across school districts, some districts may have to tax a lower base at a higher rate in order to generate comparable revenues to a wealthier district taxing itself at a lower rate. Similarly, residents in relatively poor districts must make a proportionally greater tax payment "sacrifice" in order to generate a given level of revenues than would residents of wealthier districts. (Fleeter Depo. 4) d. An equitable system of education finance should weaken the relationship between the quality of a child's education and the wealth of the child's school district. (Fleeter Depo. 9) e. The foundation dollar amount for the 1991-92 school year ($2,710) is not an indication of the minimum expenditure necessary to provide an adequate education for all of Ohio's school districts. Rather, this number is a budgetary residual, which is determined as a result of working backwards through the state aid formula after the legislature determines the total dollars to be allocated to primary and secondary education in each biennial budget. (Fleeter Depo. 11) f. There are extreme disparities among school resulting in sub-par facilities, under-staffing, lack of current text books and modern teaching equipment (i.e. computers), and other tangible and intangible measures. (Fleeter Depo. 11) g. The current foundation formula replaced the prior equal yield formula in 1981. Over the first part of the decade of the 1980's, the foundation formula effectively narrowed disparities across districts, but in the latter half of the decade, these disparities increased. (Fleeter Depo. 11-12) h. The equal yield system of school financing was implemented with the passage of the School Finance Reform Act of 1975. Ohio's equal yield program provided a minimum dollar per pupil guarantee ($59.00 in FY80) on the first 20 mills of local property tax and a lesser "incentive" guarantee ($42.00 in FY80) for local millage between 20 and 30. This power equalization program generated considerable criticism and was replaced in 1982 with the current foundation formula. Problems with the equal yield formula stemmed from the state's failure to fully fund it, from "phantom revenue" complications arising from the operation of the state's property tax reduction factors, and most significantly, from the tendency of the incentive factor to favor districts of highest wealth and lowest need. The incentive portion of the formula operated to increase disparities between wealthy and poor districts because it was primarily the wealthy districts that were able to pass additional millage. (Fleeter Depo. 13) i. Eight fundamental problems must be remedied in order to provide an equitable, adequate and reliable mechanism for funding public education in Ohio. (Fleeter Depo. 18) (1) Disparities in Local Property Wealth Differences in Class 2 real property valuation appear to be the driving force behind the Ohio school finance disparities. The rate at which inequity in Class 2 properties increased from 1981 to 1990 far exceeds the rate at which Class 1 property has grown inequitable. (Fleeter Depo. 18) The coefficient variation for Class 2 property was 1.22 in 1981 and 2.20 in 1990. (Fleeter Depo p. 19) (2) Interdistrict Cost (Price Differentials) The present cost of doing business factor presents two problems. The first being the fact that the range from 1.0 to 1.075 does not fully reflect differentials in costs associated with school district operations. The second is that the cost of doing business factor does not account for differences in cost within particular counties. (Fleeter Depo. 21) (3) Lack of Equalization of Categoricals The lack of equalization of categorical programs is a structural flaw. (Fleeter Depo 22) (4) Restriction of Local Revenue Growth House Bill 920, implemented in 1976, allows for "tax reduction factors." Increases in district property value due to inflationary price increases and the value of preexisting, unimproved property result in the calculation of "tax reduction factors," which lower a district's effective millage rate so as to leave property tax revenues unaffected by the increase in value as a result of inflationary pressures. No other state has a tax roll back or limitation measure which is this extreme in its effects. Every other state allows inflationary growth in the property tax base beyond inside millage (though many states tie permissible growth to the CPI or some other economic indicator). (Fleeter Depo. 25) An exception to the effective millage reduction is made for what is known as inside millage. Each district is allocated a certain number of inside mills (up to a maximum of ten, with most districts having 4-6), where resulting revenue is exempt from the millage roll backs due to inflationary pressures. These inside mills comprise a relatively small fraction of effective mills from most districts. However, a second exception applies to districts which are at the state minimum effective millage of 20 for either class of property. Since these districts cannot have their millage rates rolled back in response to inflation, they effectively have 20 inside mills. More than 200 districts are at the 20 mill floor for either Class 1 or Class 2 property. (Fleeter Depo. 25) (5) Attributed (Phantom) Revenue Tax reduction factors (discussed supra) take effect when property is reassessed and effectively ensure that a district receives no more revenue than it would have received in the absence of inflation. However, the foundation formula sees the new, reassessed valuation figure and will reduce state assistance in response to the larger valuation per pupil. This has become known as the "double whammy" - districts lose once by not having local revenues increase in pace with inflation and lose a second time by having state assistance actually reduced. (Fleeter Depo. 22-23) (6) Unfunded Mandates For many school districts, current education funding levels are insufficient to ensure delivery of mandated education services. (Fleeter Depo. 24) (7) Responsiveness to Enrollment Decline Changes in enrollment often have a pronounced asymmetric effect on growing and shrinking school districts. It is usually easier to increase the scale of education service in response to enrollment growth than it is to decrease the scale in response to decline in the number of students. This is largely due to the fact that it is easier to hire education personnel than it is to lay them off (or decrease their salaries) When enrollment declines, districts appear wealthier to the state aid formula because valuation per pupil increases (the opposite occurs when enrollment increases). Districts which cannot downsize immediately end up receiving less state aid than before creating a budget problem. (8) Unpredictability of the Biennial Budget Process Because state support of education is determined at each biennium as a part of the general fund budget in process, it is difficult for districts to plan beyond a two year time horizon. j. Substandard physical plants are the most "concrete" evidence that education facilities and school quality are below acceptable levels in poor districts. (Fleeter Depo. 50) k. The 9 percent debt limit has the effect of restricting capital funds for poor districts much more than for wealthy districts. (Fleeter Depo. 50) l. In 1992, when ranked by quintiles containing approximately 20 percent of Ohio school districts, the lowest property wealth quintile had 20 districts on the guarantee, while the highest quintile had 252 districts on the guarantee. The second lowest had 38 districts, while the second highest had 122 districts, with the third quintile having 75 districts guaranteed. (Fleeter Depo. 66, Tbl. 10) 4. Dr. Payton agreed that the goals contained in Dr. Fleeter's report of equity, adequacy, and reliability were appropriate goals for a school funding system. (Payton Depo. 179) Dr. Fleeter's report (Payton Depo. Exh. 7) contains the same recommendations that have been presented to the legislature for several biennia. (Payton Depo. 185) N. LEGISLATIVE TESTIMONY PRESENTED ON BEHALF OF THE OHIO DEPARTMENT OF EDUCATION AND STATE BOARD OF EDUCATION BY ASSISTANT SUPERINTENDENT OF PUBLIC INSTRUCTION WILLIAM PHILLIS 1. Dr. Phillis served as liaison between the Department of Education and the General Assembly from early 1977 through April 13, 1992. In that capacity, he was responsible for staffing the State Board of Education's Legislative Committee, assisting the State Board of Education in the development of its biennial legislative recommendations, including budget recommendations, and responsible to provide testimony to the various committees and subcommittees of the General Assembly considering education matters. Those committees and subcommittees included the Ways and Means Committee, the Finance and Appropriations Committee, and the Education Committee, both the House and Senate. (Phillis Tr. 1715-16) 2. Some of the flaws in Ohio's system of funding public elementary and secondary education which Dr. Phillis testified to are as follows: a. The Foundation Formula does not take into account income wealth in the distribution of state funds, but does factor in property wealth. b. Categorical programs are not equalized. c. Guarantees are not equalized. Guarantee provisions provide more basic aid to districts than those districts would receive if they were receiving aid from the formula calculation. d. The 20-mill required local effort does not accurately measure the ability of districts to pay the local share of the basic program. e. When property wealth increases, so does the 20-mill charge-off, so the state's share of basic aid decreases. f. Tax reduction factors limit growth on personal property tax revenues to inside millage, new construction and increased value of tangible personal property, forcing many school districts to go to the voters to approve additional levies just to keep pace with inflation. g. The foundation level has not kept pace with school district expenditures. (Pl. Exhs. 155, 156, 168, 178) O. EQUITY STATISTICS AS RELATED TO ANALYSES OF PUBLIC SCHOOL FUNDING IN OHIO 1. Equity statistics" are statistical measures of dispersion measuring the distribution of funds. Equity statistics are not measures of fairness or morality, nor do they generally take into account such things as differences in the costs of educating different children. They are primarily measures of horizontal equity. Both the coefficient of variation and the Gini coefficient indicate that there is less equity in the dispersion of school funds in 1991 than there was in 1968-69. (Alexander Tr. 3717-18; Pl. Exh. 301, pp. 78- 80) 2. The concept of vertical equity means that dollars are distributed according to need; horizontal equity refers to equal distribution of dollars per pupil. (Alexander Tr. 3864) 3. A Gini coefficient of .10 or above indicates a substantially disequalized funding system. Ohio's system of funding has remained above .10. (Alexander Tr. 3719; Pl. Exh. 301, p. 80) 4. Ohio is one of the most poorly equalized states in the United States. It is among the states with the greatest disparities expenditures per pupil of any state in the United States. (Alexander Tr. 3728) 5. Equity statistics do not take into account the quality of instructional program or quality of teachers. (Alexander Tr. 3728) 6. Ohio's system of funding public education is not consistent with the historical standards of a common system of public schools. (Alexander Tr. 3728-29) 7. Ohio's system of school funding is neither thorough nor efficient. (Alexander Tr. 3733) 8. The deprivation of adequate educational resources to a school district over time results in inter-generational problems because many of the community members lack sufficient knowledge of options to know that they have been deprived. (Alexander Tr. 3749) 9. Based on the coefficient of variation, Ohio ranked 48th of the 50 states in the extent of disparity of school funding in 1990. (Alexander Tr. 3862) 10. Small improvements in the measures of dispersion do not indicate improvement in the system because of the great extent to which the system is unequitable. (Alexander Tr. 3932) 11. Equity statistics were not presented to the trial court in Cincinnati v. Walter [in any detail as in this case], (1979), 58 Ohio St. 2d 368. (Alexander Tr. 3934) 12. The coefficients of variation for the period from 1980-- 81 to 1990-91 were extreme and unacceptable in every case, though slightly lower in 1991 than in 1981. (Alexander Tr. 3951) 13. Dr. Jimmy Payton has performed several studies looking at school finance equity from different viewpoints in different years. (Payton Depo. 82) Specifically, Dr. Payton prepared a document for the written testimony of William Phillis presented to the General Assembly on 3- 8-90 and 9-6-90 and admitted into evidence as Pl. Exh. 178. (Payton Depo. 86) 14. Dr. Payton testified that all school districts in Ohio should be part of an equity analysis because they do affect the results of such an analysis. (Payton Depo. 88) However, in such analyses, Dr. Payton usually excludes Perry Local School District, because of its unique circumstances, along with the island school districts. (Payton Depo. 130) 15. Dr. Payton did a quintile analysis comparing 1980 and 1990 data which showed that wealth distribution grew more disparate from 1980 to 1990. (Payton Depo. 189) 16. Before the Cupp Committee developed its report, Dr. Payton was asked by the Committee to create plans that would address certain issues, such as including an income factor in the funding formula, addressing the phantom revenue problem, equalizing categoricals, providing reward for effort of local school districts in the formula, and other changes. (Payton Depo. 109-10) 17. The Department of Education's position to the Cupp Committee was supportive of a change in the funding formula to modify the foundation formula to include an income factor, phase out categoricals, address the phantom revenue problem, equalize categoricals, apply costs of doing business factor to categoricals, convert outside millage to inside millage to allow some growth in local revenues, and provide substantial amounts of additional state revenues into basic aid. (Payton Depo. 117-18) If the Department's position had been adopted, the proposed amount included a billion dollar per year increase from the state level with about $400,000,000 in programs and $600,000,000 to fund changes in the foundation formula to improve equity. (Payton Depo. 118-19) Dr. Payton undertook an equity analysis on the proposal compared to the present system and concluded that the proposed changes would improve equity in all the equity measures that he applied. (Payton Depo. 123) 18. Dr. Payton developed Plaintiff's Exhibit 158 which he indicated showed that equity had gotten worse between the years 1980 and 1990. After preparing the document, Dr. Payton determined that the co-efficient of variation of 1980 should have been approximately 18.6 and for 1990 approximately 20.56. (Payton Tr. 4906-07) Dr. Payton did not change his conclusion that equity had gotten worse between the years 1980 and 1990 and, in fact, still holds the conclusion that equity has gotten worse. (Payton Tr. 4929) 19. Comparing statistical trends in equity of distribution of school funds between the period from 1980 to 1987, there appeared to be some improvement in equity, but after 1987, there has been a moving away from equity in the distribution of funds. (Phillis Tr. 1910) 20. The first fiscal year in which the "equal yield for equal effort" formula was employed for distributing state funds for public education in Ohio was 1976. (Phillis Testimony, T.p. 1833) 21. Ohio returned to a foundation formula for distributing state funds for public education in 1981-82. (Plaintiffs' Trial Ex. No. 448, pp. 66, 68; Johnson Dep., Vol. I, pp. 105-6, 170) 22. The disparities in expenditures or revenues among school districts can be measured statistically with respect to a state school finance system. (Alexander Testimony, T.p. 3863-9; Guthrie Testimony, T.p. 5148-9, 5165) 23. One measurement of equity in a state school finance system is that of equal educational opportunity or wealth neutrality. The Pearson product moment correlation coefficient and the elasticity coefficient are used to measure the strength of the relationship between per pupil revenues or expenditures and a measure of wealth in the school district such as assessed valuation or median income per pupil. (Plaintiffs' Trial Ex. No. 448, pp. 69, 70 and 73; Johnson Dep., Vol. I, pp. 76, 125-6, 155-6, 161; Porter Testimony, T.p. 1218-1219) 24. A decline in value over time (i.e. a movement towards zero) of the correlation coefficient shows increased equity. The same is true for the elasticity coefficient. (Johnson Dep., Vol. I. pp. 189-92) 25. A second measurement of equity in a state school finance system is that of horizontal equity which is based upon the principle that there should be equal treatment of equals. In an analysis of horizontal equity, all students are treated as being equal, and the extent of disparities in revenues or expenditures is then measured. (Plaintiffs' Trial Ex. No. 448, pp. 69-70, Johnson Dep., Vol. I, pp. 72-3, 107; Alexander Testimony, T.p. 3864-5; Guthrie Testimony T.p. 5383-4, 5398) 26. A third principle in state school finance analysis is that of vertical equity which has to do with students with different needs being given different resources to match those needs. (Johnson Dep., Vol. I, p. 107; Plaintiffs' Trial Ex. No. 448, p. 69; Porter Testimony, T.p. 1155; Alexander Testimony, T.p. 3864-5, 3888; Guthrie Testimony, T.p. 5384) 27. The removal from an analysis of horizontal equity of a state school finance system of monies associated with the special needs of certain students will allow an analysis of disparities in expenditures or revenues unassociated with special needs related to vertical equity. Including special needs moneys in such an analysis can make it misleading. (Porter Testimony, T.p. 1154-5; Plaintiffs' Trial Ex. No. 99, pp. 1, 5; Plaintiffs' Trial Ex. No. 100, p. 7; Plaintiffs' Trial Ex. No. 101, p. 1; Guthrie Testimony, T.p. 5224, 5324-7, 5383-4, 5398) 28. The only state subsidies to public education not tied to special needs are basic aid and equity funds. (Plaintiffs' Trial Ex. No. 99, p. 5) 29. Horizontal equity in a system of state school finance is measured statistically by such univariate measures of absolute dispersion as range, restricted range, federal range ratio, high-low ratio, and interquintile or interquintile range. It is also measured by more sophisticated bivariate measures of relative dispersion such as the coefficient of variation, Gini coefficient, and McLoone Index. The latter measure the characteristics of an entire distribution, or portion thereof, rather than simply the characteristics of several specific points in the distribution, as is the case with measures of absolute dispersion. (Plaintiffs' Trial Ex. No. 448, pp. 72, 74; Plaintiffs' Trial Ex. No. 99, p. 12; Plaintiffs' Trial Ex. No. 100, p. 11; Porter Testimony, T.p. 1135-1137; Guthrie Testimony, T.p. 5163-4; Alexander Testimony, T.p. 3865, 3870-1) 30. The Gini coefficient indicates how far the distribution of revenues or expenditures is from providing each proportion of students with equal proportions of revenues or expenditures. It contrasts the actual distribution with the absolute fiscal equality that would result from 10% of the students getting 10% of the revenues or expenditures, 50% of the students getting 50% of the revenues or expenditures, and so forth - a distribution which would graphically be a straight diagonal line of 45 . Numerically, the Gini coefficient represents the area on a graph between the 45 line of absolute equality and the line representing the actual distribution (Lorenz curve) divided by the total area below the 45 line. The closer the value is to zero, the more equitable is the distribution. (Plaintiffs' Trial Ex. No. 301, p. 64; Plaintiffs' Trial Ex. No. 99, p. 13; Defendants' Trial Ex. No. 2, App. A. pp 4-5; Alexander Testimony, T.p. 3716, 3874) 31. The Gini coefficient puts relatively more weight on the middle of the distribution and is less influenced by extreme values than other measures of relative dispersion. (Plaintiffs' Trial Ex. No. 106, p. 522; Porter testimony, T.p. 1079; Guthrie Testimony, T.p. 5164) 32. The Gini coefficient is the best measure of disparities in revenues or expenditures among school districts in a state system of school finance. (Alexander Testimony, T.p. 3876; Guthrie Testimony, T.p. 5164) 33. The McLoone Index measures the extent to which revenue, or expenditures, for pupils below the median in the distribution deviate from the median. It is the ratio of actual expenditures or revenue for pupils below the median to what these pupils would receive if they were at the median. As the value increases toward 1.0, equity increases in the lower half of the distribution. (Plaintiffs' Trial Ex. No. 301, p. 64; Plaintiffs' Trial Ex No. 99, p. 13; Defendants' Trial Ex. No. 2, App. A. pp. 3-4) 34. The coefficient of variation for a distribution of revenues or expenditures is calculated by dividing the standard deviation of the distribution (i.e. the mean dispersion distance of each individual value from the distribution mean) by the mean of distribution. It can be expressed as a percentage or a decimal. As the value decreases, equity improves. (Defendants' Trial Ex. No. 2, App. A, pp. 2-3; Plaintiffs' Trial Ex. No. 301, p. 64; Plaintiffs' Trial Ex. No. 99, pp. 12-13; Alexander Testimony, T.p. 3716, 3873, 3891-2) 35. The coefficient of variation is more sensitive to change in the tails (richest and poorest districts) or extremes of the distribution than the McLoone Index or Gini coefficient. (Guthrie Testimony, T.p. 5164-5, 5361; Porter Testimony, T.p. 1077, 1079, 1182-1183; Plaintiffs' Trial Ex. No. 106, p. 522) 36. The range is the difference between the highest and lowest values in a distribution of revenues or expenditures per pupil. As the range decreases, equity increases. (Plaintiffs' Trial Ex. No. 301, p. 64; Plaintiffs' Trial Ex. No. 99, p. 12; Defendants' Trial Ex. No. 2, App. A, p. 1) 37. The high to low ratio (or ratio of revenue extremes) is calculated by dividing the highest value in a distribution of revenues or expenditures per pupil by the lowest value. As the value decreases, equity increases. (Defendants' Trial Ex. No. 2, App. A, p. 1) 38. The restricted range in a distribution of revenues or expenditures per pupil is the difference between the highest and lowest values at selected percentiles in the distribution. As the restricted range decreases, equity increases. (Defendants' Trial Ex. No. 2, App. A, p. 1; Plaintiffs' Trial Ex. No. 301, p. 64; Plaintiffs' Trial Ex. No. 99, p. 12) 39. The federal range ratio is the difference between the per pupil revenues or expenditures at the 95th and 5th percentiles in the distribution divided by the value at the 5th percentile. As the federal range ratio decreases, equity increases. (Plaintiffs' Trial Ex. No. 301, P. 64; Defendants' Trial Ex. No. 2, App. A, p. 2; Alexander Testimony, T.p. 3719, 3872) 40. With respect to equal educational opportunity, there was less of a relationship between current expenditures per pupil and assessed valuation per pupil in school year 1988-89 than in either of school years 1980-81 or 1982-83, as shown by a decline in the correlation coefficient in a study done by Dr. Gary Johnson. This shows increased equity in 1988-89 from that in either 1980-81 or 1982-83. (Plaintiffs' Trial Ex. No. 448, pp. 76-7; Johnson Dep., pp. 105-6, 189-92) 41. There was less of a relationship between current expenditures per pupil (whether total expenditures, general fund expenditures, or general fund expenditures minus Disadvantaged Pupil Impact Aid were used) and assessed valuation per pupil in school year 1989-90 than in school year 1980-81, as shown by a decline in. the correlation coefficient in a study done by Dr. Tod Porter. This shows increased equity in 1989-90 from that in 1980-81. (Plaintiffs' Trial Ex. No. 99, Table 8; Plaintiffs' Trial Ex. No. 101, Tables 4 and 6; Porter Testimony, T.p. 1186-1191, 1199-1200, 1203-1204) 42. There was less of a relationship between expenditures per pupil and assessed valuation per pupil in school year 1988-89 than in school year 1980-81 as shown by a marginal decline in the correlation coefficient in a study done by Dr. Kern Alexander. There was more of relationship between revenues per pupil and assessed valuation per pupil comparing those same years as shown by a slight increase in the correlation coefficient. Dr. Alexander concluded that one could not clearly determine that the system of school finance was more or less fiscally neutral in 1988-89 then in 1980-81. (Alexander Testimony, T.p. 3912-3) 43. Dr. Gary Johnson analyzed horizontal equity in Ohio's system of school finance using pupil-weighted measures of current expenditures per pupil and excluding from the analysis the 2% of school districts with the highest per pupil expenditures so as to eliminate the statistical bias associated with skewness. (Plaintiffs' Trial Ex. no. 448, pp. 72-3, Johnson Dep., Vol. I, pp. 85-7, 129-30) 44. Dr. Johnson's analysis covered five alternate years from school years 1980-81 through 1988-89 with the equal yield formula being in effect for the first year and the foundation formula for the other four years. (Johnson Dep., Vol. I, pp. 105-6, 170; Plaintiffs' Trial Ex. No. 448, Table 1, p. 74) 45. Dr. Johnson's expenditures consisted of state and local moneys excluding debt service and capital outlay. (Johnson Dep., Vol. I, pp. 128-9) 46. Dr. Johnson's analysis utilized a doctoral dissertation which contained analyses also of the horizontal equity of the distribution of revenues per pupil and analyses done without excluding the 2% of school districts. (Johnson Dep. Ex. No. 3; Johnson Dep., Vol. I, pp. 60-1, 109, 178-9) 47. Dr. Tod Porter analyzed horizontal equity in Ohio's system of school finance using pupil-weighted measures of current expenditures per pupil (including state and local moneys) and excluding from the analysis only the small island school districts. (Plaintiffs' Trial Ex. No. 99, pp. 5, 6, 12, 20; Plaintiffs' Trial Ex. No. 100, pp. 7, 11) 48. Dr. Porter's analysis covered the three school years 1980-81, 1984-85, and 1989-90. (Plaintiffs' Trial Ex. No. 99, p. 17; Plaintiffs' Trial Ex. No. 100, pp. 17-18; Porter Testimony, T.p. 1179-1180) 49. Dr. Porter's analysis excluded state subsidies for vocational education from the distribution. (Porter Testimony, T.p. 1156-1157; Plaintiffs' Trial Ex. No. 99, p. 20; Plaintiffs' Trial Ex. No. 100, p. 7) 50. As a general matter, school districts with lower assessed valuations per pupil spend more money per pupil on vocational education than school districts with higher assessed valuations per pupil. (Payton Testimony, T.p. 4904-5, 4925) 51. Dr. Porter believed that an analysis which measures equity over time can be misleading if special needs moneys are included in total expenditures being analyzed. (Plaintiffs' Trial Ex. No. 99, p. 1; Plaintiffs' Trial Ex. No. 101, p. 1) 52. Dr. Porter believed that general fund expenditures excluded most categorical aid and sought to eliminate special needs moneys from his expenditure analysis by subtracting out DPIA funds from general fund expenditures. (Plaintiffs' Trial Ex. No. 101, p. 1; Plaintiffs' Trial Ex. No. 99, p. 5; Porter Testimony, T.p. 1195-1196) 53. General fund expenditures include categorical aid for special education. (Daubenmire Testimony, T.p. 4944; Phillis Testimony, T.p. 1839-1840) 54. Dr. Kern Alexander analyzed horizontal equity in Ohio's system of school finance in 1990 using pupil-weighted measures of distributions of revenues per pupil. (Alexander Testimony, T.p. 3786-3789, 3914; Defendants' Trial Ex. No. 14, App. VI) 55. Dr. Alexander analyzed horizontal equity in Ohio's system of school finance in 1993 using pupil-weighted measures of distributions of, separately, revenues, expenditures including federal revenues, and expenditures excluding federal revenues, excluding in all three analyses the island school districts. (Plaintiffs' Trial Ex. No. 301, pp. 63-89; Plaintiffs' Trial Ex. No. 301a, pp. 82a-89a; Alexander Testimony, T.p. 3899, 3903) 56. State moneys for special needs of pupils or school districts were excluded from some of Dr. Alexander's decile analysis; Dr. Alexander did not exclude these moneys in calculating his equity statistics. (Alexander Testimony, T.p. 3886, 3908, Plaintiffs' Ex. 310, pp. 25-26) 57. Dr. Alexander's 1990 analysis of revenues covered the school years 1980-81 and 1988-9. (Alexander Testimony, T.p. 3916-70 58. Dr. Alexander's 1993 analysis of revenues covered the consecutive school years 1980-81 through 1990-91. (Plaintiffs' Trial Ex. No. 301, pp. 66-73) 59. Dr. Alexander's 1993 analysis of expenditures including federal revenues covered the alternate school years from 1968-69 through 1990-91. (Plaintiffs' Trial Ex. No. 301, pp. 74-81) 60. Dr. Alexander's 1993 analysis of expenditures minus federal revenues covered the alternate school years from 1980-81 through 1990-91. (Plaintiffs' Trial Ex. No. 301, pp. 82-89; Plaintiffs' Trial Ex. No. 301a, pp. 82a-89a) 61. In Dr. Alexander's 1993 analysis, revenues per pupil were $161.23 less than expenditures per pupil in 1980-81. In 1984-85, revenues per pupil were $418.27 more than expenditures per pupil for that year. (Plaintiffs' Trial Ex. No. 301, pp. 66, 74) 62. In Dr. Alexander's 1993 analysis, federal revenue per pupil ranged from a low of $6.29 per pupil in 1980-81 to a high of $217.59 per pupil in 1984-85, as determined by the differences in expenditures for the years in common on the two charts. (Plaintiffs' Trial Ex. No. 301, p. 66; Plaintiffs' Trial Ex. No. 301a, p. 82a) 63. Data from Dr. Alexander's 1990 analysis was presented to a joint committee of the Ohio General Assembly. (Defendants' Trial Ex. No. 14, App. VI, pp. 47-50; Alexander Testimony, T.p. 3786-9) 64. Revenue data for Dr. Alexander's 1990 analysis was obtained on computer tape from the Ohio Department of Education. (Alexander Testimony, T.p. 3916-7) 65. Revenue and expenditure data for Dr. Alexander's 1993 analyses was obtained from the Cost Per Pupil publications of the Ohio Department of Education. Such data was entered by hand into Dr. Alexander's computer. Because of data problems, the equity statistics from the 1990 analysis of revenues for 198081 should be substituted for the equity statistics for that year in the 1993 analysis of revenues. (Alexander Testimony, T.p. 3915, 3918, 3920-2) 66. The Ohio Department of Education may correct in its computers data published in the Cost Per Pupil publications without correcting the data in the publications. (Daubenmire Testimony, T.p. 4944-5; Alexander Testimony, T.P. 3918) 67. For 37 school districts in 1980-81, the Ohio Department of Education's computer data base reflects expenditure data which differs from that in Dr. Alexander's data base by more than $250,000 for each of such districts. (Daubenmire Testimony, T.p. 4955-6) 68. For other years, Dr. Alexander's data base reflects that expenditures for a school district were rounded off to the nearest Sl million, including for districts spending in total as little as $1 or 2 million. (Daubenmire Testimony, T.p. 4956) 69. Dr. James Guthrie analyzed horizontal equity in Ohio's system of school finance using measures of the distribution of revenues per pupil (without weighing school districts by ADM) and different distributions of school districts consisting of a distribution excluding school districts with the 5% of students with the highest revenues per pupil and the 5% of students with the lowest revenues per pupil ("federal range"), a distribution excluding school districts with the 5% of students with the lowest revenues per pupil ("modified federal range"), and a distribution with only the island districts and a school district partially in Indiana (College Corner) excluded. (Defendants' Trial Ex. No. 2, pp. 5-7, ex. 9-13, Guthrie Testimony, T.p. 5154-5, 5157, 5162, 5166) 70. Dr. Guthrie's analysis of the distribution of local revenues plus state basic aid revenues covered the school years 1978-79, 1980-81, 1984-85, 1987-88, and 1990-91 for both the federal range and modified federal range, and it covered the school years 1978-79 and 1990-91 for all school districts excluding the islands and College Corner. (Guthrie Testimony, T.p. 5223-4, 5226, Defendants' Trial Ex. No. 2, ex. 9-11) 71. Dr. Guthrie's analysis for the school years 1978-79 and 1990-91 for all school districts exclusive of the islands and College Corner also included a distribution of local revenues plus state basic aid, DPIA and categorical revenues and a distribution of local revenues plus augmented state revenues (state basic aid, DPIA, categorical revenues, and subsidies paid to school districts to reimburse them for lost property tax revenues as a result of the homestead exemption and a property tax rollback). (Guthrie Testimony, T.p. 5227-8; Defendant's Trial Ex. No. 2, ex. 12-13) 72. The school year 1978-79 is the earliest school year for which the Ohio Department of Education had complete data in its computer system. (Daubenmire Testimony, T.p. 5025; Guthrie Testimony, T.p. 5152) 73. As of September, 1993, local revenue data was not yet complete within the Ohio Department of Education for school year 1991-92. (Guthrie Testimony, T.p. 5170; Daubenmire Testimony, T.p. 4939) 74. Drs. Johnson, Porter, Alexander and Guthrie are each experts in the area of school finance. 75. Dr. Johnson found that there had been a slight improvement from 1980-81 to 1988-89 in the horizontal equity of Ohio's school finance system as measured by the range and restricted range. (Plaintiffs' Trial Ex. No. 448, p. 74) 76. Dr. Johnson found an improvement in horizontal equity in Ohio's school finance system from 1980-81 to 1988-89 as measured by the federal range ratio and a modest but steady improvement in equity by this measure from 1982-83 to 1988-89. (Plaintiffs' Trial Ex. No. 448, p. 74-75) 77. Dr. Johnson found a slight improvement in equity as measured by the McLoone Index for the lower half of the distribution of expenditures from both 1980-81 and 1982-83 to 1988-89. (Johnson Dep., Vol. I, pp. 171-172) 78. Dr. Johnson found no significant, or any consistent and clear, trends over the period 1980-81 through 1988-89 for the coefficient of variation, McLoone Index, or the Gini coefficient, although they exhibited collectively some degree of erosion in equity, particularly the coefficient of variation. (Plaintiffs' Trial Ex. No. 448, p. 75) 79. Dr. Johnson found that the adjusted range, adjusted restricted range, and the federal range ratio measures reflected an overall movement towards greater horizontal equity in Ohio's school finance system from 1980-1981 through 1988-89. (Plaintiffs' Trial Ex. No. 448, p. 75) 80. With respect to all measures of horizontal equity except for the Gini coefficient in Dr. Johnson's analysis, the equity of the distribution of expenditures was improved in 1988-89 over that in 1982-83. The Gini coefficient was the same in these two years. (Plaintiffs' Trial Ex. No. 448, Table 1, p. 74) 81. With respect to the federal range ratio, coefficient of variation, McLoone Index, and Gini coefficient as measured in the dissertation utilized in Dr. Johnson's analysis, the equity of the distribution of expenditures per pupil was improved in 1988-89 over that in 1982-83 when the 2% of districts with the highest current expenditures were not eliminated from the analysis. (Johnson Dep. Ex. No. 3, Table 2) 82. With respect to the federal range ratio, coefficient of variation, McLoone Index, and Gini coefficient as measured in the dissertation utilized in Dr. Johnson's analysis, the equity of the distribution of local plus state revenues per pupil was improved in 1988-89 over that in 1982-83 whether or not the 2% of districts with the highest revenues were eliminated from the analysis. (Johnson Dep. Ex. No. 3, Table 4) 83. Dr. Porter found that there had been a slight movement away from horizontal equity in Ohio's school finance system from 1980-81 to 1989-90 in accordance with various statistical measures applied to different categories of expenditures per pupil (except for the McLoone Index for total expenditures which moved toward equity). (Porter Testimony, T.p. 1096, 1181-1183, 1193-1194, 1196-1197; Plaintiff's Trial Ex. No. 99, pp. 6, 7, 17; Plaintiffs' Trial Ex. No. 100, pp. 10, 17, 18; Plaintiffs' Trial Ex. No. 101) 84. In his 1990 study, Dr. Alexander found horizontal equity in Ohio's system of school finance improved in 1988-89 over that in 1980-81 as measured by the federal range ratio, coefficient of variation, McLoone Index, and Gini coefficient applied to distributions of revenues per pupil. (Alexander Testimony, T.p. 3928-9, 3930-1, 3938-9, 3957-8; Defendants' Trial Ex. No. 14, App. VI, pp. 47-50) 85. In the 1990 study, the federal range ratio moved toward equity from 1.27 in 1980-81 to .8724 in 1988-89, a 31.3% change. Dr. Alexander characterized this as a modest improvement in equity. (Alexander Testimony, T.p. 3930-1) 86. In the 1990 study, the coefficient of variation moved toward equity from 26.45 in 1980-81 to 26.03 in 1988-89, a 1.2% change. Dr. Alexander characterized this as a slight increase in equity. (Alexander Testimony, T.p. 3938-9) 87. In the 1990 study, the Gini coefficient moved toward equity from .1403 in 1980-81 to .1245 in 1988-89, an 11% change. Dr. Alexander characterized this as a small increase in equity. (Alexander Testimony, T.p. 3957-8) 88. In the 1990 study, the McLoone Index moved toward equity from .86 in 1980-81 to .89 in 1988-89, a 3.5% change. Dr. Alexander characterized this as a relatively substantial increase in equity. (Alexander Testimony, T.p. 3971-5) 89. In his 1993 study of the equity of distributions of revenues per pupil, Dr. Alexander found horizontal equity in Ohio's system of school finance improved in 1990-91 over that in 1980-81 as measured by the federal range ratio, coefficient of variation, McLoone Index, and Gini coefficient. (Alexander Testimony, T.p. 3934-6, 3949, 3965-6, 3977-8) 90. In the 1993 study of revenues, the federal range ratio moved toward equity from 1.27 in 1980-81 to .7706 in 1990-91, a change of approximately 40%. (Alexander Testimony, T.p. 3934-6) 91. In the 1993 study of revenues, the coefficient of variation moved toward equity from 26.45 in 1980-81 to 25.04 in 1990-91, about a 5% change. (Alexander Testimony, T.p. 3949) 92. In the 1993 study of revenues, the McLoone Index moved toward equity from .86 in 1980-81 to .8815 in 1990-91, a 3% change. (Alexander Testimony, T.p. 3977-8) 93. In the 1993 study of revenues,the Gini coefficient moved toward equity from .1403 in 1980-81 to .1177 in 1990-91, a 16% change. (Alexander Testimony, T.p. 3965-6) 94. In the 1993 study of revenues, the federal range ratio, coefficient of variation, McLoone Index, and Gini coefficient all showed greater equity in 1990-1 then in 1981-82. (Plaintiffs' Trial Ex. No. 301, pp. 69-72) 95. In his 1993 study of the equity of distributions of expenditures (including federal revenues) per pupil, Dr. Alexander found that the federal range ratio, coefficient of variation, and Gini coefficient moved away from equity from 1976-77 to 1990-91, while the McLoone Index moved toward equity during this time period. (Plaintiffs' Trial Ex. No. 301, pp. 77-80) 96. In this 1993 study of expenditures, the federal range ratio changed from .8161 in 1976-77 to .8586 in 1990-91, approximately a 5% change. (Alexander Testimony, T.p. 3937; Plaintiffs' Trial Ex. No. 301, p. 77) 97. In this 1993 study of expenditures, the coefficient of variation changed from 20.49 in 1976-77 to 21.43 in 1990-91, a 4.6% change. (Alexander Testimony, T.p. 3953) 98. In this 1993 study of expenditures, the Gini coefficient changed from .1128 in 1976-77 to .1165 in 1990-91, a 3% change. (Alexander Testimony, T.p. 3963-4) 99. In this 1993 study of expenditures, the McLoone Index changed from .8726 in 1976-77 to .8838 in 1990-91, a 1.3% change. (Alexander Testimony; T.p. 3974-5) 100. In his 1993 study of the equity of distributions of expenditures per pupil minus federal revenues, Dr. Alexander found that the coefficient of variation, Gini coefficient and McLoone Index moved away from equity from 1980-81 to 1990-91, while the federal range ratio moved toward equity during this time period. (Plaintiffs' Trial Ex. No. 301a, pp. 85a-88a) 101. In this 1993 study of expenditures minus federal revenue, the federal range ratio changed from .7959 in 1980-81 to .7346 in 1990-91, an 8% change. (Alexander Testimony, T.p. 3931-2) 102. In this 1993 study of expenditures minus federal revenue, the coefficient of variation changed from 19.81 in 1980-81 to 21.25 in 1990-91, a 7.3% change. (Plaintiffs' Trial Ex. No. 301a, p. 87a) 103. In this 1993 study of expenditures minus federal revenue, the McLoone Index changed from .8903 in 1980-81 to .8794 in 1990-91, a 1.2% change. (Alexander Testimony, T.p. 3978-9) 104. In this study of expenditures minus federal revenue, the Gini coefficient changed from .1078 in 1980-81 to .1143 in 1990-91, 1.6% change. (Alexander Testimony, T.p. 3966-7) 105. With respect to all measures of horizontal equity employed in Dr. Guthrie's analysis of the distribution of local and state basic aid revenues per pupil, equity improved from 1978-1979 to 1990-91 for both the federal range and modified federal range. Equity improved during this time period, as measured by the Gini coefficient and McLoone Index, for these revenues when all school districts except the islands and College Corner were included in the analysis. (Guthrie Testimony, T.p. 5223-7; Defendants' Trial Ex. No. 2, pp. 5-6, ex. 9-11) 106. Equity as measured by the Gini coefficient and the McLoone Index improved from 1978-79 to 1990-91 in Dr. Guthrie's analysis of horizontal equity in revenues when all school districts except the islands and College Corner were included in distributions of revenues per pupil consisting of local revenues, state basic aid, DPIA, and categorical aid. Equity also improved for these measures during this time period for these school districts when state subsidies for homestead exemptions and property tax rollback were included in the revenue distribution. (Guthrie Testimony, T.p. 5227-30; Defendants' Trial Ex. No. 2, pp. 6-7, ex. 12-13) 107. In his analysis of the horizontal equity of the distribution of revenues per pupil, the only instances Dr. Guthrie found in which there was a movement away from equity from 1978-79 to 1990-91 was with respect to the ratio of revenue extremes and coefficient of variation when all school districts but the islands and College Corner were included in the distribution being analyzed (with the exception that the coefficient of variation remained unchanged when augmented state revenues were used). (Guthrie Testimony, T.p.5226-5230; Defendants' Trial Ex. No. 2, ex. 11-13) 108. The ratio of revenue extremes and the coefficient of variation are sensitive to changes in the extremes of a distribution. (Guthrie Testimony, T.p. 5163-4, 5227, 5361-2; Porter Testimony, T.p. 1077; Plaintiffs' Trial Ex. No. 106, p. 522) 109. Dr. Guthrie found it to be virtually indisputable that Ohio's system of school finance was more equitable in 1991 than in 1979. (Guthrie Testimony, T.p. 5225, 5258) 110. Dr. Guthrie analyzed the horizontal equity of the distribution of local and state basic aid revenues per pupil for 1990-91 when augmented by the actual and projected distributions by school district of equity or equalization aid for each of the school years 1992-93, 1993-94, 1994-95. (Guthrie Testimony, T.p. 5230-1; Defendants' Trial Ex. No. 2, p. 7, ex. 14) 111. In the foregoing analysis of the hypothetical impact of equity aid upon 1990-91 revenue distribution, the addition of each of the three years' equity funds separately to 1990-91 revenues per pupil resulted in an improvement in equity in the ratio of revenue extremes, the coefficient of variation, and the Gini coefficient while the McLoone Index remained constant. (Guthrie Testimony, T.p. 5231; Defendants' Trial Ex. No. 2, p. 7, ex. 14) 112. Neither of plaintiffs' expert witnesses who included special needs moneys in their expenditure distributions performed any analyses to determine if changes in horizontal equity over time as measured by equity statistics were being influenced by changes in expenditures for special needs. (Plaintiffs' Trial Ex. No. 301; Alexander Testimony, T.p. 3886-9, 3908-11; Plaintiffs' Trial Ex. No. 448) 113. Analyses of horizontal equity in distributions of assessed valuation per pupil do not necessarily tell one anything about horizontal equity in per pupil education expenditures or revenues. (Porter Testimony, T.p. 1165-1166; Alexander Testimony, T.p. 3792-3, 3798-9) 114. The use of per pupil revenues in analyses of horizontal equity in school finance more accurately reflects the State's responsibility as a provider of resources and is a better measure of equity than per pupil expenditures where the State's actions are at issue. (Guthrie Testimony, T.p. 5150, 5314) 115. School finance analyses comparing school districts may be performed in accordance with generally accepted standards in the area either by weighing school districts by their numbers of students or by leaving the districts unweighed. (Fortune Testimony, T.p. 3500-1; Guthrie Testimony, T.p. 5167-8) 116. The Cleveland City School District was the 29th highest spending district in the state on a per pupil basis in school year 1990-91. More than sixty percent of its pupils receive Aid to Dependent Children. (Defendant's Trial Ex. No. 4b, p. 30; Defendants' Trial Ex. No. 23, p. 6; Guthrie Testimony, T.p. 5182-3) 117. Outliers as that term is employed in statistics are points in a distribution which are at least two to three standard deviations from the mean. (Porter Testimony, T.p. 1141) 118. An outlier in statistics can also be a point which is unusual and wouldn't be representative in predicting the total population of a distribution. (Alexander Testimony, T.p. 3889) 119. In terms of expenditures per pupil, the only school districts in Ohio which are more than three standard deviations from the mean are those at the high-spending end of the distribution. (Porter Testimony, T.p. 1144; Alexander Testimony, T.p. 3892-5; Guthrie Testimony, T.p. 5181-2) 120. Dr. Alexander did not exclude from his analyses any school districts simply because they were high-spending. The eight school districts, exclusive of the island districts, whose education spending in 1991 placed them more than three standard deviations above the mean were not excluded from Dr. Alexander's analyses in Plaintiffs' Trial Ex. No. 301. Their per pupil spending ranged from approximately $7,000 to $11,000. (Alexander Testimony, T.p. 3894-3901; Defendants' Trial Ex. No. 4b) 121. In an analysis of horizontal equity, outliers included in the distribution could affect the trend in equity statistics over time if they became more extreme relative to the mean. (Porter Testimony, T.p. 1146; Alexander Testimony, T.p. 3897) 122. Neither Dr. Porter nor Dr. Alexander did any analyses to determine if their changes in equity statistics over time were attributable to the movement of outliers relative to the mean. (Porter Testimony, T.p. 1150, 1189-1190; Alexander Testimony T.p. 3898) P. GROWTH IN EDUCATION REVENUE 1. From 1979 through 1991, local revenues and state revenues (Basic Aid, DPIA, and categorical aid) for education increased 37% on a per pupil basis more than inflation as measured by the Consumer Price Index. (Defendants' Trial Ex. No. 2, p. 2, Ex. 1 thereto; Guthrie Testimony, T.p. 5190, 5193) 2. Monies provided by the legislature for funding public education have been increased since 1982 at more than double the rate of inflation. (Browning Testimony, T.p. 4380, 4469) 3. There was a 50% increase in real dollar expenditures on education from 1977 to 1991. (Alexander Testimony, T.p. 3930) 4. The state's share of education funding increased during the 1980's from 37% to 47% of total education spending. (Plaintiffs' Trial Ex. No. 100, p. 5; Porter Testimony, T.p. 1130; Phillis Testimony T.p. 1829. See also Alexander Testimony, T.P. 3851-3852) 5. Increases in the foundation level employed in the formula for financing public education have exceeded the rate of inflation by 60% since 1980. (Browning Testimony, T.p. 4468) 6. The growth in local and state revenues for public education from 1979 to 1991 has been higher in lower per pupil revenue (Testimony, T.p. 5210, 5223, 5257-5258; Defendants' Trial Ex. No. 2, pp. 3-5, ex. 2-8). 7. Of the 50 school districts with the lowest per pupil assessed valuations in 1990, only 15 took out emergency school assistance loans from 1987-1993. (Brown Testimony, T.p. 5462-5463) 8. Local revenues and state revenues (Basic Aid, DPIA, and categorical aid) per pupil for education in Dawson-Bryant School District grew from 1979 through 1992 by 47% more than inflation as measured by the Consumer Price Index. (Guthrie Testimony, T.p. 5248-5250; Defendants' Trial Ex. No. 2, ex. 18 thereto) 9. Local revenues and state revenues (Basic Aid, DPIA, and categorical aid) per pupil for education in Southern Local School District grew from 1979 through 1992 by 45% more than inflation as measured by the Consumer Price Index. (Guthrie Testimony, T.p. 5248-5250; Defendants' Trial Ex. No. 2, ex. 18 thereto) 10. Local revenues and state revenue (Basic Aid, DPIA, and categorical aid) per pupil for education in Northern Local School District grew from 1979 through 1992 by 53% more than inflation as measured by the Consumer Price Index. (Guthrie Testimony, T.p. 5248-5250; Defendants' Trial Ex. No. 2, ex. 18 thereto) 11. Local revenues and state revenue (Basic Aid, DPIA, and categorical aid) per pupil for education in Lima City School District grew from 1979 to 1992 by 49% more than inflation as measured by the Consumer Price Index. (Guthrie Testimony, T.p. 5248-5250; Defendants' Trial Ex. No. 2, ex. 18 thereto) 12. Local revenues and state revenues (Basic Aid, DPIA, and categorical aid) per pupil for education in Youngstown City School District grew from 1979-1992 by 42% more than inflation as measured by the Consumer Price Index. (Guthrie Testimony, T.p. 5248-5250; Defendants' Trial Ex. No. 2, ex. 18 thereto) 13. The effective mean millage for Class I residential and agricultural property in the State of Ohio in 1992 was 28.81 mills. For that year, the effective Class I millage in Dawson-Bryant School District was 22.04 mills, in Southern Local School District it was 25.91 mills, in Northern Local School District it was 25.92 mills, in Lima City School District it was 24.93 mills, and in Youngstown City School District it was 41.92 mills. (Guthrie Testimony, T.p. 5250; Defendants' Trial Ex. No. 2, ex. 18 thereto) 14. The poorer the school district in property valuation, the greater is state basic aid for education as a percentage of assessed valuation per pupil, and state basic aid is more strongly distributed in inverse proportion to assessed valuation pupil in 1991 than in 1979. (Guthrie Testimony, T.p. 5232-5234; Defendants' Trial Ex. No. 2, pp. 7-8, ex. 15 and chart 5) 15. State aid (Basic Aid, categorical aid, DPIA and homestead exemption and rollback subsidies) is distributed in inverse proportion to the distribution of median income among Ohio school districts. (Guthrie Testimony, T.p. 5234-5235; Defendants' Trial Ex. No. 2, p. 8, ex. 16 and chart 6) 16. The increases in public education revenues described herein occurred during a time when required spending in the Medicaid program increased from 19% of the state's general fund spending a dozen years ago to its current 32%. (Browning Testimony, T.p. 4374, 4377-4378; 4467-4469) 17. The operating expenses of the various departments and agencies of state government represent less than 20% of general revenue fund spending, with all other spending from that fund consisting of transfer payments and subsidies such as for education, higher education, human services programs, and property tax relief. (Browning Testimony, T.p. 4375-4376) 18. For fiscal year 1993, the General Assembly provided a $45 million "equity appropriation" to be distributed to poorer school districts utilizing a formula based upon the school district's median income and assessed valuation per pupil. Similar appropriations were made to fiscal years 1994 and 1995 in the amounts of $60 million and $75 million respectively. For fiscal year 1994, the poorest school district receiving such funds is getting $570 per pupil with the median amount in these districts being $108 per pupil. (Joint Stipulation, 1116 and 20, ex. 15; Browning Testimony, T.p. 4382-4383; Sanders Testimony, T.p. 4482-4483; Aronoff Testimony, T.p. 4819) 19. In fiscal year 1990, Ohio ranked 11th and 14th among the 50 states in two different charts showing expenditures per pupil in public education. (Alexander Testimony, T.p. 4041) 20. In fiscal year 1990, Ohio ranked 22nd among the 50 states in total state and local taxes paid per $1,000.00 in personal income. (Browning Testimony, T.p. 4373) 21. The General Assembly provided in the current budget bill for the use of $10 million in lottery funds annually to leverage $69 million or more in bond proceeds to be available for capital construction in the poorer school districts. (Browning Testimony, T.p. 4384; Sanders Testimony, T.p. 4484) 22. Senator Cooper Snyder introduced Senate Bill 237 in the fall of 1993. This bill provides for further increases in the local revenue charge-off, incorporating an income factor into the foundation funding formula, containing the phase-out of basic aid guarantees, equalizing the distribution of funds for categorical programs, and sharing growth in Class 2 real property among the school districts. (Aronoff Testimony, T.p. 4814-4817) 23. The state superintendent of public instruction believes that the changes he is recommending in the system of public school finance should remain within the discretion of the General Assembly and not be directed by the courts. (Sanders Testimony, T.p. 4488-4490) 24. The actual cost of living differences between counties as measured by the average weekly wage of various sectors of the economy range up to 36%. (Payton Testimony, T.p. 4900-4901) 25. The per pupil expenditures in Defendants' Trial Ex. No. 4 a-c are adjusted expenditures. Joint vocational school district students are included in the ADM used to calculate this item on fulltime equivalency basis, and the monies expended by joint vocational school districts on such students are also included. (Payton Testimony, T.p. 4886-4887) 26. The vital statistics such as those in Stipulation Ex. No. 7 utilize unadjusted expenditures per pupil. Joint vocational school district students are included in the ADM used to calculate expenditures per pupil but the monies expended by joint vocational school districts on such students are not included. (Payton Testimony, T.p. 4888-4889) 27. Dr. Alexander utilized unadjusted expenditures per pupil in computing the equity statistics in Plaintiffs' Trial Ex. Nos. 301 and 301a. (Alexander Testimony, T.p. 3968-3970) 28. The adjusted expenditures per pupil figure is a more accurate representation of how much money is spent on a school district's pupils in a particular fiscal year than unadjusted expenditures per pupil. (Payton Testimony, T.p. 4888) 29. The total assessed valuations certified to the Department of Education by the Department of Taxation for Perry Local School District for fiscal years 1990 and 1991 do not represent the assessed valuation on which the nuclear power plant in that school district actually paid taxes. For fiscal year 1990, the certified amount was nearly five times the amount on which taxes were paid, and for fiscal year 1991, the certified amount was twice the amount upon which taxes were paid. (Payton Testimony, T.p. 4902-4903) VI. FINANCIAL DISTRESS: THE RESULT OF OHIO'S SCHOOL FUNDING SYSTEM A. SCHOOL CLOSINGS FOR LACK OF FUNDS PROHIBITED 1. School districts are prohibited from engaging in deficit spending for operating purposes except as specifically provided by law. (Russell Depo. 77; Brown Depo. 22; R. C. Section 5705.39) 2. Prior to the enactment of the emergency school assistance loan legislation, schools could close if a school district did not have sufficient operating revenue to maintain school operations. Over 55 such districts did close their doors or delay the opening of school for financial reasons. Stipulation Exhibit 26 is a true and accurate list of districts that closed due to a lack of operating revenue during the decade of the 1970s and some in the 1960s. (Stip. 45; Stip. Exh. 26) 3. Since 1979, school districts that do not have sufficient funds to complete the school year are no longer permitted to close. Also, schools are not permitted to delay the opening of school due to lack of funds. Those school districts that face a deficit are required by law to borrow funds to continue operations. (Russell Depo. 68; Stip. 44) 4. Those districts having less than ten days' true cash reserve at the end of a year are considered by the Department of Education to be "borderline" in terms of financial distress. (Brown Depo. 23) 5. One of the predictors of school district financial distress is the circumstance of a district spending more in general fund dollars in a given year than it receives. (Tavakolian Depo. 124) 6. Revenue trends that the Department considers to indicate financial distress include decreases in local or state revenue, or the loss of taxable value due to the exemption or abatement of property from taxation. (Brown Depo. 24) 7. The Department of Education considers a staff salary and benefit ratio of 83 to 85 percent of the general fund revenue to be a benchmark. "Loan fund districts" tend to spend more than the benchmark percentage on salaries and fringe benefits. (Brown Depo. 29) 8. For FY93, the Department projected that 207 school districts would end the year with a deficit and be required to borrow additional operating funds. Of those 207 districts, 127 were projected to be in need of emergency school assistance loans because the amount of their projected deficit exceeded the amount of their spending reserve. (Van Keuren Depo. 91-92; Van Keuren Depo. Exh. 3) 9. School districts will experience financial distress if local tax revenue does not increase, state revenue does not increase, and the costs of operation do increase. (Van Keuren Depo. 90) 10. Districts in financial distress offer a lesser quality of educational programming than those that are not. (Van Keuren Depo. 50) 11. Program reductions in financially distressed school districts that are required in order to participate in the emergency school assistance loan program result in lesser levels of educational programming than would otherwise have been available to those pupils. (Sanders Tr. 4610) 12. The amount of a school district deficit will be expected to double each year unless the school district either reduces expenses or increases revenue through the passage of an additional tax levy. The reason for the increase is the annual increases in salary and benefit costs resulting from increases in collective bargaining agreements. (Van Keuren Depo. 46) 13. Federal mandates prohibit reductions in special education services. Generally reductions in expenditures by districts in financial difficulty impact regular education students more 90 than special education students. (Taylor Depo. 236) 14. The problem of school districts being unable to operate within available revenue is increasing because, in many instances, all available expenditure cuts have been made, the districts have been unable to pass additional local tax levies, the districts have not realized any additional revenue from existing local tax levies, and the level of state revenue has been inconsistent and unreliable. (Van Keuren Depo. 69) 15. The renewal of existing local property tax levies and the passage of additional tax levies are recommended by the Department of Education for local school districts that are in financial distress. (Brown Depo. 38-39; Stip. 22) 16. School district in financial distress must either reduce expenditures or raise additional revenue; expenditure reduction is governed by the provisions of statute, collective bargaining agreements and required compliance with state minimum standards. (Brown Depo. 41) 17. The Department of Education does not recommend that school districts in financial distress take any action that would be contrary to the terms of a negotiated collective bargaining agreement. (Brown Depo. 37; Stip. 36) 18. Plaintiffs' Exhibit 228 represents Ohio school districts that were in a deficit situation in FY93 and the spending reserve for each of the school districts. Plaintiff Youngstown City School District had a deficit of $6.8 million and a spending reserve of only $1.58 million. Plaintiff Southern Local School District had a deficit of $363 thousand and a spending reserve of only $11,520. (Pl. Exh. 228) 19. Plaintiffs' Exhibit 229 is a document showing Ohio school districts projected to have an operating deficit for FY92; these districts are considered to be probable loan fund districts. In that year, Plaintiff Southern Local School District had a projected deficit of $491,000 and a spending reserve of $15,810. (Pl. Exh. 229) 20. The point of greatest school district fiscal distress was formerly October 1, the date when the school district was required to adopt a permanent appropriations measure. Current rules do not require County Auditors to submit amended certificates of estimated resources until after the November General Election. The delay in receipt of the final certificate of estimated resources creates uncertainty about whether to seek a loan. (Brown Depo. 85-88) 21. Senator Aronoff admitted that there are school districts in Ohio that are broke and out of funds. In Senator Aronoff's 8th Senatorial District, the Cincinnati School District is in dire financial straits. The total outstanding debt from Cincinnati to the State Loan Fund is over $82 million, including accrued interest of $8.7 million. (Aronoff Tr. 484244) 22. None of the financial woes experienced by school districts within the State of Ohio are the fault of the students within those school districts. (Brown Tr. 5516) 23. Those students in the financially troubled school districts are the individuals at greatest risk of suffering the most harm due to the lack of school funding. (Brown Tr. 5517) B. FINANCIAL DISTRESS IN THE PLAINTIFF SCHOOL DISTRICTS DAWSON-BRYANT 1. Since about 1985, the financial situation of the school district deteriorated. Expenses of the school district increased. Therefore the amount of carry-over funds decreased from year to year. To meet the situation, there were reductions in the certified staff, and the number of mechanics and school counselors were reduced. Even with these adjustments, expenses continued to exceed revenues and the carry-over balance continued to decline. (White Tr. 2077-79) 2. Dawson-Bryant's expenditures have exceeded revenues for several years, and the district anticipated a negative balance for FY93. Due to equity funds and efforts to reduce expenditures, the district did not have a negative balance at the end of FY93. Efforts to reduce expenditures FY93 included negotiating a reduced benefit package for all employees, increasing restrictions upon field trips to eliminating field trips, restricting text books and material purchases, rationing paper and other materials, and limiting maintenance to identified items that had to be addressed, repaired,and halting bus purchases. (Washburn Tr. 2374-75) 3. For FY94, additional efforts to reduce expenditures were made, including reducing staff, replacing only one of three teachers who retired, not replacing a maintenance employee who retired, continuing to ration paper, continuing to eliminate field trips, and continuing the reduced benefit package of employees. No bus purchases and no library purchases can be made in FY94. (Washburn Tr. 2375-76) 4. The Dawson-Bryant Local school District is projected to receive less money in FY94 than it did in FY93. The reduction is because the district will be a guarantee district and their appropriations will be funded on the FY92 level. Also DPPF calculations are based upon the number of ADC students, and, although that number has continued to climb, the funding provided is now based on a three-year average, so that figure has not grown in accordance with the number of ADC students. Dawson- Bryant had a net loss of twelve students through open enrollment, and the district will have money deducted from its budget as a result of those students leaving. (Washburn Tr. 2436) In addition, categorical programs were cut 1.37 percent. Even with equity funds that will be received by the district, the FY94 budget will contain less money than the FY93 budget. (Washburn Tr. 2376-77) 5. The Dawson-Bryant Local School District has been certified by the Ohio Department of Education as having a projected operating deficit. (Sanders Tr. 4605-06; Stip. 145; Stip Exh. 56) 6. The financial distress of the Dawson-Bryant Local School District is not the result of poor management. Area 5 Coordinator, Mr. Ken Taylor, indicated that the management at Dawson-Bryant has been excellent, and he believes that if the districts in Area 5 are given additional funds, that they would effectively manage those funds and that they would strive to provide better programs and services for students in that area. (Taylor Depo. 285-87) 7. With reference to the economy of the Dawson-Bryant School District and region, there is very little industry. Most of the people who reside within the school district that are employed work outside the district and, in many instances, outside the state. Average income in the district is quite low compared to other districts in the state. (White Tr. 2072-73) The largest employer within the Dawson-Bryant Local School Distract is the school system. (White Tr. 2074) 8. The residents of Dawson-Bryant passed a 5.9 mill levy in May of 1993. Because there is no industry in the district, the tax is placed directly upon residents whose income level averages approximately $21,000 per year. 25 percent of the district's students ADC recipients and more than 50 percent of the students qualify for free lunch and additional students qualify for reduced lunches. Obviously, residents of the district do not have discretionary income to pay additional taxes. Thus, a tax levy for operation is not a viable option. (Washburn Tr. 2382-85) 9. Dawson Bryant was a member of the plaintiff class in Board of Education of City School District of City of Cincinnati v. Walter, 58 Ohio St. 2d 368, 390 N.E. 2d 813 (1979) cert. denied, 444 U.S. 1015. 10. State education payments to Dawson-Bryant are 430.59% of what the district's residents pay in state income tax. (Defendants' Trial Ex. No. 4c) 11. Eighty-five percent, or more, of Dawson-Bryant's budget is state money. (Washburn Testimony, T.p. 2470; White Testimony, T.p. 2163) 12. Dawson-Bryant is in the 99th percentile of all school districts in receipt of state aid as a percent or revenue. (Plaintiffs' Trial Ex. No. 4) 13. Dawson-Bryant received $477,154 in equity assistance funds in fiscal year 1993. (Stip. Ex. No. 17) 14. Dawson-Bryant received $607,246 in equity assistance funds in fiscal year 1994. (Defendants' Trial Ex. No. 1, tab. 1) 15. Dawson-Bryant is scheduled to receive $644,929 in equity money in fiscal year 1995. (Defendants' Trial Ex. No. 1, tab. 1) 16. Dawson-Bryant received approval for over $10 million in state funds to finance the construction of a new high school and remodeling work on the existing high school and middle school. (Washburn Testimony, T.p. 2367; White Testimony, T.p. 2207) 17. Dawson-Bryant received $50,000 in equity technology assistance in fiscal year 1993 for the purchase of new computers. (Washburn Testimony, T.p. 2380.) 18. In fiscal year 1992, Dawson-Bryant was protected from nearly $51,000 in state budget cuts. (Stip. Ex. No. 14) 19. From 1986 to 1991, Dawson-Bryant received over $731,000 under the guarantee provision of the state basic aid formula. This assured the district of more funds than it would have otherwise been entitled to under a straight application of the foundation formula. (White Testimony, T.p. 2149 and Plaintiffs' Trial Ex. No. 461) 20. From 1980 to 1992, Dawson-Bryant did not even attempt to place an education levy on the ballot. (Stipulation Ex. No. 10) 21. In 1987, Dawson-Bryant had a year-end spending reserve of $947,603 and an effective millage rate of 20.09 mills. (Plaintiffs' Trial Ex. No. 255 and Stipulation Ex. No. 4, p. 2) 22. During Superintendent White's tenure, the year-end spending reserve was as high as $1.3 million. (White Testimony, T.p. 2133) 23. In fiscal year 1993, Dawson-Bryant had an anticipated deficit of over $113,000. (Stip Ex. No. 56) 24. The anticipated deficit in fiscal year 1993 never occurred because the equity money that the district received offset the anticipated deficit and kept the district out of the loan fund. (Washburn Testimony, T.p. 2472) 25. For fiscal year 1994, Dawson-Bryant had an anticipated deficit of over $305,000. (Stip. Ex. No. 56) 26. The anticipated deficit in fiscal year 1994 will not occur because the equity money that the district received will offset the anticipated deficit. (Washburn Testimony, T.p. 2381-2382) 27. In fiscal year 1992, Dawson-Bryant levied property taxes with an effective millage of 8 mills below the state mean. (Stip. Ex. No. 57) 28. At approximately $30,000 per mill, Dawson-Bryant could raise over $240,000 per year in additional local revenue if it just taxed itself at the state mean. (White Testimony, T.p. 2162) 29. In fiscal year 1993, the voted operating millage for Dawson-Bryant was 18.74 mills less than the statewide average for total operating mills, and it levied property taxes with an effective millage of 6.98 mills less than the state average for residential and agricultural property and 8.04 mills below the state average for all other property. (Defendants' Trial Ex. No. 23) 30. From 1979 to 1993, enrollment at Dawson-Bryant decreased by 353 students or 20%. (Stip. Ex. No. 1) 31. From 1979 to 1992, the pupil per teacher ratio improved 12.7%. (Stip. Ex. No. 3) 32. In 1988, salary and benefit costs accounted for 72% of Dawson-Bryant's budget. In fiscal year 1992, salary and benefit costs accounted for 82% of Dawson-Bryant's budget. (Plaintiffs' Trial Ex. No. 254) 33. In fiscal year 1993, Dawson-Bryant paid its teachers $316,920 more than required by the state minimum salary schedule. (White Testimony, T.p. 2151-2152 and Plaintiffs' Trial Ex. No. 276, answer 1) 34. In school year 1991-1992, all teachers received a signing bonus of 2.5% of the base salary. (Semanco Deposition, p. 66) 35. Mr. Washburn, upon taking over the superintendency in August, 1992, agreed to a 2% raise for all teachers. (Washburn Testimony, T.p. 2329) 36. After its last review by the Ohio Department of Education, Dawson-Bryant was found to be in compliance with state minimum standards on June 27, 1991. (Stip. 99) 37. Dawson-Bryant offered no independent expert analysis to show that it did not have the means to comply with state minimum standards. 38. Dawson-Bryant offered no independent expert analysis to show that its revenues failed to keep pace with inflation. 39. From 1987-1992, revenue to Dawson-Bryant increased $20,000 more than expenditures. (Plaintiffs' Trial Ex. No. 276, answer 2) LIMA 40. People who move into the Lima City School district tend to be people who are moving to take advantage of low income housing. As a result, the individuals who attend the Lima City Schools tend to be poor. (Buroker Tr. 2873-74) 41. Mr. Roger Miller, a life-long resident of Lima City Schools, has watched the finances of the district and various levy issues over the last 20 years. During that time, the district has not lost a levy other than one income tax proposal. The passage rate of levies has risen to 70 percent positive and 30 percent negative. Over the last several years, however, that percentage has dropped down into the 60 and 50 percent range. The last levy in 1990 passed by only a handful of votes. The district is in the precarious situation of losing the ability to gain voter approval of tax levies. (Roger Miller Depo. 73-74) 42. The Lima City School District has not proposed the passage of additional tax levies to its voters because it has one of the lowest tax bases and one of the lowest per capita incomes of any school district in the State of Ohio, such that the tax payers of the District are already assuming a significant burden. In addition, the voters of the city experience municipal overburden charges through the requirement that they pay for the services of water, sewer, and police protection. Thus, the existing tax burden, combined with an ever increasing population living below the poverty line makes the prospect of passage of an additional tax levy unlikely. (Buroker Tr. 3075-76) 43. Lima City School District ("Lima") was a member of the plaintiff class in Board of Education of City School District of City of Cincinnati v. Walter, 58 Ohio St. 2d 368, 390 N.E. 2d 813 (1979) cert. denied, 444 U.S. 1015. 44. State education payments to Lima in 1991 were 246.02% of the state income taxes paid by its residents. (Defendants' Trial Ex. No. 4c) 45. In school year 1990-91, Lima ranked in the bottom 13% of all school districts for average income per tax return and the bottom 12% for assessed valuation per pupil while its education expenditures per pupil ranked it in the top 47% of all school districts. (Defendants' Trial Ex. No. 4e) 46. In fiscal year 1993, Lima received $908,973 in equity assistance funds. (Stip. Ex. No. 17) 47. In fiscal year 1994, Lima received $1,084,085 in equity assistance funds. (Defendants' Trial Ex. No. 1, tab. 1) 48. In fiscal year 1995, Lima is scheduled to receive $1,152,095 in equity assistance funds. (Defendants' Trial Ex. No. 1, tab. 1) 49. In fiscal year 1992, Lima was held harmless from over $242,834 in state budget cuts. (Stip. Ex. No. 14) 50. From 1979 to 1993, enrollment in the Lima City School District dropped 2,075 or 25%. (Stip. Ex. No. 1) 51. From 1979 to 1992, the pupil/teacher ratio improved 2.79 pupils, or 13%, to 18.4 pupils per teacher. (Stip. Ex. No. 3) 52. In fiscal year 1991, Lima had the 57th lowest total ADM per classroom teacher ratio in the state. (Stip. Ex. No. 57) 53. In school year 1991-1992 Lima paid $12,450,756 in teacher salaries. (Defendants' Trial Ex. No. 22b) 54. Under Ohio's minimum salary schedule, Lima was required to pay $9,900,319 in teacher salaries. See O.R.C. 3317.13 (1990) (effective July 26, 1991). (Defendants' Trial Ex. No. 22b) 55. Lima failed to apply for school building assistance funds at any time that funds were made available. (Plaintiffs' Trial Ex. Nos. 377, 378 and Stip. Ex. No. 45) 56. In February 14, 1989, Lima was informed that it was in compliance with all state minimum standards. (Stip. 99) 57. Lima's high school is accredited by the North Central Association. (Stip. Ex. No. 37) 58. Lima was informed on June 10, 1991 that its special education program was in substantial compliance with all special education standards following its last evaluation. (Plaintiffs' Trial Ex. No. 282) 59. Lima offered no independent expert testimony to prove that it does not have the means to comply with state minimum standards. 60. Lima has not proposed a school levy to the voters since 1990. (Stip. Ex. No. 10) 61. For fiscal year 1991 Lima taxed itself at an effective class 1 millage rate of 24.67 mills and at an effective class 2 millage rate of 25.72 mills. The state mean effective millage rate for 1991 for class 1 was 28.73 mills and for class 2 was 29.2 mills. (Defendants' Trial Ex. No. 4c) 62. In Lima, one mill raises $261,000. (Buroker Testimony, T.p. 2985) 63. If Lima had taxed itself at the state mean for 1991, it would have raised approximately an additional one million dollars in that year alone. 64. Lima has 40 full-time equivalent teachers out of 470 who are funded through Chapter I and Disadvantaged Pupil Program fund monies. (Buroker Testimony, T.p. 2990) These teachers provide intervention to students from kindergarten through high school. (Buroker Testimony, T.p. 2990) 65. Lima provides intervention in the form of specifically designed programs and curricula for at-risk high school students at the alternative high school. (Buroker Testimony, T.p. 2993) 66. Lima provides intervention for female high school students through a grant from the Department of Vocational Education. (Buroker Testimony, T.p. 2993-94) 67. Lima provides intervention for at-risk elementary students through Project Intercept. (Buroker Testimony, T.p. 2995-96) 68. Lima offers adult education classes for community members. (Buroker Testimony, T.p. 2996) Current enrollment is approximately 1150 students. (Buroker Testimony, T.p. 2997) 69. Students in every school in Lima receive tutoring and intervention through the Adopt-A-School program. (Buroker Testimony, T.p. 2997-98) 70. In 1991, Lima spent $307,348 of Disadvantaged Pupil Program Fund money for intervention at the elementary and high school levels. (Plaintiffs' Ex. 286; Buroker Testimony, T.p. 3002-03) 71. Lima spends Sl,200,000 every year in Chapter I money for intervention at the elementary and high school levels. (Buroker Testimony, T.p. 3010) 72. Almost all elementary classrooms in Lima have at least one computer. (Buroker Testimony, T.p. 3011) 73. Three elementary schools in Lima have writing-to-read computer labs, which help teach kindergarten and first grade students how to read and write. (Buroker Testimony, T.p. 3011) 74. Lima has a computer science magnet school for students from kindergarten through eighth grade. (Buroker Testimony, T.p. 3029) 75. Each of the middle schools in Lima has a computer lab with about 30 computers in each lab. (Buroker Testimony, T.p. 3012) 76. Lima Senior has a computer lab, each department has computers, and the library has five computers, some equipped with CD ROM capability. (Buroker Testimony, T.p. 3012) 77. Lima has no significant debt, except for repayment of energy management assistance bonds. (Buroker Testimony, T.p. 3013) 78. Lima's superintendent claims that the district has facilities needs of approximately $19,000,000. (Buroker Testimony, T.p. 3019) 79. If Lima were to in debt itself to the nine percent limitation, it would raise $20,000,000. (Plaintiffs Trial Ex. No. 3; Buroker Testimony, T.p. 3020-21) 80. Lima has never been in a situation which required an emergency school loan or a spending reserve loan. (Buroker Testimony, T.p. 3021-22) 81. Lima has an arts magnet school for students from kindergarten to eighth grade. (Buroker Testimony, T.p. 3029) 82. Lima is presently in compliance with all standards relating to special education. (Buroker Testimony, T.p. 3039; Plaintiff's Trial Ex. No. 282) 83. High school students in Lima grow in the development of independent thinking skills while learning to appreciate and respect opposing viewpoints. (Buroker Testimony, T.p. 3041) 84. High school students in Lima develop an awareness of the importance of achieving and maintaining physical and mental health and develop an awareness of aesthetic and artistic values. (Buroker Testimony, T.p. 3041) 85. Lima Senior High School offers a wide range of educational programs for students and their individual needs. A student is able to follow a college preparatory course, a vocational or business course, or a general education course. (Buroker Testimony, T.p. 3042) 86. Lima requires 21 credits for high school graduation, three more than the state requires. (Buroker Testimony, T.p. 3043) 87. The college preparatory course of study offered at Lima Senior High gives each student a firm foundation for success in college. (Buroker Testimony, T.p. 3044-45) 88. Lima offers six classroom Advanced Placement courses and one tutorial Advanced Placement Course. Plaintiffs' Trial Ex. No. 455; Buroker Testimony, T.p. 3048-49. In addition, Lima offers 18 "achievement courses", which are designed for college bound students who desire a more in-depth study of the subject matter. (Plaintiffs' Trial Ex. No. 455; Buroker NORTHERN LOCAL 89. Plaintiff Northern Local School District has experienced a rapid increase in enrollment due in part to zoning laws which allow existing farmland to be split into tracts for mobile homes. (Hill Depo. 48) During the last seven years, families moving into the Northern Local School District have been lower income families, and the ability of the district's residents to pay additional taxes has decreased. (Dilbone Tr. 2047-48) 90. In addition to rapidly increasing the enrollment in Plaintiff Northern Local School District, mobile homes hurt Plaintiff Northern Local School District's local tax receipts because mobile homes are taxed at a different rate than real property. (Hill Depo. 48) 91. Mobile homes in a school district create special problems for the school district. Mobile homes are taxed at a lower rate than permanent structures. A 3 - bedroom mobile home will most likely yield about $60 per year in taxes, where a 3-bedroom permanent house will probably yield between $150 and $300 per year in taxes. In addition, mobile homes bring numerous students into a particular district without bringing the tax revenue to support those students. (Shoemaker Tr. 4177-78) 92. If the per pupil spending in Plaintiff Northern Local School District was increased from the current $3,000 per pupil to the state average of approximately $4,500 per pupil, it would require an additional $3 million in additional revenue. The school district would have to levy over 30 mills in addition to what is already levied in order to bring the school district's per pupil spending up to the state average. (Johnson Tr. 1485) 93. Voters in Plaintiff Northern Local School District have rejected several recent levy proposals, and many voters have stated that they reject the proposals because school district tax proposals are some of the few tax raises that voters have an opportunity to oppose. 94. Northern Local was part of the plaintiff class in Board of Education of City School District of City of Cincinnati v. Walter, 58 Ohio St. 2d 368, 390 N.E. 2d 813 (1979), cert. denied, 444 U.S. 1015. 95. In fiscal year 1993, Northern Local received $183,917 in equity assistance money. (Stip. Ex. No. 17) 96. In fiscal year 1994, Northern Local received $297,094 in equity assistance money. (Defendants' Trial Ex. No. 1, tab. 1) 97. In fiscal year 1995, Northern Local is scheduled to receive $401,215 in equity assistance money. (Defendants' Trial Ex. No. 1, tab. 1) 98. In fiscal year 1991, state education payments to Northern Local represented 182.35% of the state income taxes paid by its residents. (Defendants' Trial Ex. No. 4c) 99. Since 1982, Northern Local's voters have defeated 13 different school tax issues. (Stip. Ex. 10 and Johnson Testimony, T.p. 1453) 100. One mill in Northern Local raises approximately $90,000. (Johnson Testimony, T.p. 1485) 101. In fiscal year 1992, Northern Local levied property taxes with an effective millage of S.1 mills below the state mean. (Stip. Ex. 57) 102. In fiscal year 1992, Northern Local's total ADM per classroom teacher ratio ranked it in the top 23% of all school districts in Ohio. (Stip. Ex. No. 57) 103. In fiscal year 1992, Northern Local's staff per pupil ratio ranked it in the top 30% of all school districts in Ohio. (Stip. Ex. No. 57) 104. From 1979 to 1992 enrollment at Northern Local dropped 249 pupils or 10%. (Stip. Ex. No. 1) 105. From 1979 to 1992, the pupil per teacher ratio improved from 27.47 to 19.8, an improvement of almost 28%. (Stip. Ex. No. 3) 106. From 1982-83 to 1990-91, the average teacher's salary at Northern Local Increased 62.9%. This percentage increase was greater than that of all other Plaintiffs and greater than the state average percent increase. (Plaintiffs' Trial Ex. No. 204) 107. Northern Local pays its teachers on average approximately $1,000 per year over the amount required by state minimum salary requirements. (Johnson T.p. 1500) 108. Northern Local did not apply for funds made available by the State through the school building assistance program until December 8, 1992. (Plaintiffs' Trial Ex. Nos. 376, 377 and 378; Stip. Ex. No. 45; Van Keuren Testimony, T.p. 4800-4801) 109. Northern Local applied for and secured funds under the energy assistance bill which allowed it to get new windows, new lighting, and a new heating system at the jr./sr. high school complex. (Johnson Testimony, T.p. 1514-1515) 110. Northern Local could build a new elementary building with only local funds if the voters would approve a levy. (Johnson Testimony, T.p. 1447 and Miller Testimony, T.p. 1631) 111. Northern Local could build a new elementary building and rehab all buildings within the district with all local funds for less than 9% of its assessed valuation according to plans the architect gave to the district. (Miller Testimony, T.p. 1651) 112. During the last compliance review of Northern Local, the Ohio Department of Education found the district to be in compliance with state minimum standards. (Stip. 99) 113. Sworn interrogatory answers signed February 17, 1992 by Superintendent Johnson show that as of that date the district was in compliance with all minimum standards. (Johnson Testimony, T.p. 1490) 114. During its last PREP review, Northern Local also complied with all state requirements for special education students. (Plaintiffs' Trial Ex. No. 124) 115. Northern Local's Sheridan High School has been accredited by the North Central Association (hereinafter N.C.A.) since 1976. (Stip. Ex. No. 37) 116. Northern Local's Sheridan High School currently meets all N.C.A. standards. (Johnson Testimony, T.p. 1523) 117. N.C.A. standards are more demanding than state minimum standards. (Johnson Testimony, T.p. 1523, Brown Testimony, T.p. 5427-5428, 5432-5433) 118. No independent expert testified that Northern Local did not have "the means to comply with state minimum standards". 119. Northern Local offered no independent expert testimony to prove that its revenues failed to keep pace with inflation. 120. Northern Local's passage rate on the Ninth Grade Proficiency Test is higher than the state average. (Johnson Testimony, T.P. 1529) 121. Northern Local has the lowest dropout rate, highest graduation rate and the highest percent of college prep graduates of all Plaintiffs despite spending less per pupil than all other Plaintiffs. (Stip. Ex. Nos. 4-8 and 57) 122. In fiscal year 1992, Northern Local School ranked in the bottom 1% of all Ohio school districts in total revenue per pupil, all funds (608); expenditure per pupil, general funds (606); and expenditure per pupil, all funds (606). (Stip. Ex. No. 57) SOUTHERN LOCAL 123. The economic situation in Perry County and in Plaintiff Southern Local School District is poor. Employment is down, companies have closed their doors, and some of the larger employers in the company, coal businesses, have ceased operations. At one time the railroad was the major employer in the county, but it closed its operations. (Altier Tr. 1289; Spangler Tr. 442-43) 124. In his position as Chairman of the Corning Bank, Mr. Altier has observed that the delinquent list of defaulted loans, commercial and home loans, grows every month. Repossession is much more frequent that it used to be. Bankruptcies have increased. (Altier Tr. 1291) 125. Large purchases of tracts of land have been made by the federal government in the Wayne National Forest, located in Plaintiff Southern Local School District. The federal government does not pay any taxes on this property. (Altier Tr. 1291-92) 126. Increasing revenues by voter approval of local tax levies is not an option for Southern Local. In one year, the cost of benefits for employees went up $93,000, which would take 4 mills of local property taxation to generate. In 1989, the voters of the district approved an operating levy of 3.9 mills and the following year approved a facilities bond levy for 7 percent of the valuation of the district. At about the same time, the major employer in the district went out of business. Most of the families in the district qualify for free or reduced lunch benefits, and the federal government has acknowledged that they cannot pay for lunch. Industry is very limited in the district and the reported average family income is approximately $18,000. There is no income base and there is no property base at Southern Local with which the district can increase its local revenue. (Spangler Tr. 481-83) 127. For a board of education to try to pass a levy may cost from a few hundred dollars to two thousand dollars to pay election expenses. (Spangler Tr. 483) Because one mill raises so little in districts with low assessed valuation per pupil, those districts have very little to promise the voters in exchange for passing additional millage. (Spangler Tr. 483) Public trust and support is defeated by returning to the voters to ask them for additional millage when they cannot afford to pay. (Spangler Tr. 484) 128. Southern Local was part of the plaintiff class in Board of Education of City School District of City of Cincinnati v. Walter, 58 Ohio St. 2d 368, 390 N.E. 2d 813 (1979), cert. denied. 444 U.S. 1015. 129. In 1991, the state education payments to Southern Local were 431.37% of the estimated state income tax its residents paid. (Defendants' Trial Ex. No. 4c) 130. The State of Ohio contributes approximately 80% of all Southern Local's revenues. (Spangler Testimony, T.p 479) 131. Southern Local received $289,369 in equity assistance funds in fiscal year 1993. (Stip. Ex. No. 17) 132. Southern Local received $374,873 in equity assistance funds in fiscal year 1994. (Defendants' Trial Ex. No. 1, tab. 1) 133. Southern Local is scheduled to receive $430,784 in equity assistance funds in fiscal year 1995. (Defendants' Trial Ex. No. 1. tab. 1) 134. Southern Local received $90,000 in equity technology assistance in fiscal year 1993 for computer purchases. (Stip. Ex. No. 19) 135. Southern Local received approximately $7.9 million in state funds to finance the construction of a new K-8 building which opened in the fall of 1993. (Spangler Testimony T.p. 444, 456) 136. Southern Local was eligible for the State school building assistance program in 1981; however, its voters turned down the levy required for participation. (Spangler Testimony, T.p. 604; Phillis Testimony, T.p. 1823-1824 and Stip Ex. No. 10) 137. Southern Local was held harmless from nearly $39,000 in state budget cuts in fiscal year 1992. (Stip. Ex. No. 14) 138. From 1987 to 1993, Southern Local received over $700,000 under the guarantee provision contained in the school foundation funding formula. (Plaintiffs' Trial Ex.No. 461 and Spangler Testimony, T.p. 612-614) 139. Although Southern Local ranks in the bottom 1% of all school districts for average income per tax return and the bottom 2% for assessed valuation per pupil, its 1990-91 expenditures per pupil rank it in the top 30% in the state. (Defendants' Trial Ex. No. 4a) 140. From 1979 to 1993, Southern Local's enrollment declined 324 students or 24%. (Stip. Ex. No. 1) 141. From 1979 to 1992, Southern Local's teacher/pupil ratio improved 22%. (Stip. Ex. No. 3) 142. In school year 1991-92, Southern Local paid its teachers approximately $179,000 per year over the state minimum salary requirements. (Spangler Testimony, T.p. 628-629) 143. In 1991, Southern Local employed 8.52 more classroom teachers than required by state minimum standards. (Plaintiffs' Trial Ex. No. 2) 144. The average cost of a teacher at Southern Local is $40,000 per year for wages and benefits. (Spangler Testimony, T.p. 635) 145. In 1991, Southern Local employed 2.81 more education service personnel than required by state minimum standards. (Plaintiffs' Trial Ex. No. 42) 146. In 1991, Southern Local employed 1.14 more building administrators than comparable districts. (Plaintiffs' Trial Ex. No. 42) 147. In 1991, Southern Local employed 2.43 more secretarial/ clerical workers than comparable districts. (Plaintiffs' Trial Ex. No. 42) 148. Southern Local had a year-end carryover balance of $488,568 in fiscal year 1987-88, $389,309 in fiscal year 1988-89, and $284,126 in fiscal year 1989-90. (Plaintiffs' Trial Ex. No. 42) 149. Southern Local totally depleted its spending reserve by December 1991 when it received a $211,000 emergency assistance loan. Southern Local was approved for a loan in the amount of $241,000 for FY92. This, along with a spending reserve of $16,000 gave the district a total anticipated deficit of $257,000. The district was able to cut costs and contain the loan amounts to a spending reserve loan of $16,000 and an emergency school advancement loan of $195,000. Southern Local took a spending reserve loan of $16,000 to fulfill its statutory obligation to take a spending reserve loan as a precondition to receiving an emergency school advancement loan. (Pl. Exh. 43 and 44) 150. In fiscal year 1992, Southern Local levied property taxes with an effective millage of 4.3 mills below the state mean. (Stip. Ex. No. 57) 151. In fiscal year 1993, 1 mill raised $24,056 in Southern Local. Defendants' Trial Ex. No. 23. Superintendent Spangler testified that 1 mill raised approximately $23,000. T.p. 679. 152. If Southern Local's effective millage matched the state mean in fiscal year 1992, it could have raised approximately $100,000 in additional local revenue. (Stip. Ex. No. 57 and Defendants' Trial Ex. No. 23; Spangler Testimony, T.p. 679) 153. After its last review by the Ohio Department of Education, Southern Local was found to be in compliance with state minimum standards on June 13, 1989. (Stip. 99) 154. Southern Local's Miller High School is currently accredited by the North Central Association. (Spangler Testimony, T.p. 685) 155. Southern Local offered no independent expert analysis to show that it did not have the means to comply with state minimum standards. 156. Southern Local offered no independent expert testimony to show that its revenues failed to keep pace with inflation. YOUNGSTOWN 157. In Plaintiff Youngstown City School District, 1 mill of taxes would have raised about $62 for each student in 1979, but only $41 in 1987, and only $37 in 1990. (Pl. Exh. 108, p.1) 158. For FY93, Youngstown City School District projected a $5 million deficit. (Hiscox Depo. Vol. I, 26) 159. Although the Youngstown City School District projected a $5 million deficit in 1993, the district was able to avoid having to take out an emergency school assistance loan by reducing staffing, loaning itself some funds from its self-insured health plan, changes in transpor- tation policy, and delaying the start of construction projects. (Hiscox Depo. Vol. I, 28) 160. The projected deficit for FY94 for the Youngstown City School District was $8 million, with revenue of $78 million and expenses of $86 million. Without the $5 million reductions made in FY93, the deficit for 1994 would have been $13 million. (Hiscox Depo. Vol. I, 31- 32; see Pl. Exh. 225) 161. Mr. Hiscox cited a number of reasons for the escalating deficit of the Youngstown City School District. Among these reasons are the increased cost of the health plan, the costs of retraining teachers to meet Department of Education curriculum mandates, EMIS, special education requirements, and the maintenance of facilities. (Hiscox Depo. Vol. I, 33-34) 162. The Youngstown City School District's local revenue has been hurt by the economy of the Youngstown area. The Youngstown business community has been devastated since the steel mills closed down, and the city of Youngstown has given tax abatements to industry in attempt to draw business to the area. The combination of the steel mills closing and the abatement process has had a detrimental impact on Youngstown's financial projections. (Hiscox Depo. Vol. I, 37; Kolitsos Depo. 26) 163. In Plaintiff Youngstown City School District, between tax year 1978 and 1987, the total assessed valuation fell from slightly over $1 billion to $606 million, measured in 1990 dollars. By the 1990 tax year, total assessed value had fallen to $547 million. (Pl. Exh. 108, p. 1) 164. Youngstown City School District was a member of the plaintiff class in Board of Education of City School District of the City of Cincinnati vs. Walter, 58 Ohio St. 2d 3 813 (1979) cert. denied, 444 U.S. 1015. N.E. 2d 165. State education payments to Youngstown in 1991 were 317.56% of the state income taxes paid by its residents. (Defendants Trial Ex. No. 4c) 166. In school year 1990-91, Youngstown ranked in the bottom 1% of all school districts for average income per tax return and the bottom 14% for assessed valuation per pupil while its education expenditures per pupil ranked it in the top 15% of all school districts. (Defendants' Trial Ex. No. 4c) 167. From 1980-1990, Youngstown suffered an inflation adjusted decrease in assessed valuation of $16,000 per pupil and adjusted gross income of $4,000 per tax return. (Plaintiffs' Trial Ex. No. 100. charts 6 and 7) 168. Youngstown experienced an increase in education funding of $323 per pupil, inflation adjusted, from 1979 to 1987. (Plaintiffs' Trial Ex. No. 103, P.6) 169. Youngstown's education expenditures increased while the real tax burden on owners of residential property decreased from Plaintiffs' Trial Ex. No. 103, p. 3. 170. From 1979 Lo 1987, state revenue increased from 50% to 70% of all general revenue funds in the Youngstown City School District. (Plaintiffs' Trial Ex. No. 103, p. 3) 171. In fiscal year 1993, Youngstown received $2,101,575 in equity assistance funds. (Stip. Ex. No. 17) 172. In fiscal year 1994, Youngstown received $2,747,395 in equity assistance funds. (Defendants' Trial Ex. No. 1, tab. 1) 173. In fiscal year 1994, Youngstown is scheduled to receive $3,073,604 in equity assistance funds. (Defendants' Trial Ex. No. 1, tab. 1) 174. In fiscal year 1992, Youngstown was held harmless from over $627,000 in state budget cuts. (Stip. Ex. No. 14) 175. At the start of fiscal year 1991, Youngstown had a cash balance of $4,738,418. By December 31, 1993, Youngstown had an anticipated deficit of $9,864,240. (Hiscox Deposition Ex. No. 29, p. 5) 176. From 1979 to 1993, enrollment in the Youngstown City School District dropped 4,220 or 23%. (Stip. Ex. No. 1) 177. From 1979 to 1992, the pupil per teacher ratio improved 9.56 pupils, or 39%, to 14.8 pupils per teacher. (Stip. Ex. No. 3) 178. In fiscal year 1991, Youngstown had the 25th lowest total ADM per classroom teacher ratio in the state and the 39th lowest total ADM per staff ratio. (Stip. Ex. No. 57) 179. Current Superintendent Tutela significantly reduced the number of central office employees because he believed the central office budget was excessive and disproportionate to the district's needs. (Marino Testimony, T.p. 3354-5) 180. Due to the low pupil per teacher ratio and high personnel costs, the district is trying to increase the pupil per teacher ratio closer to the state standard of 25 to 1. (Hiscox Deposition, Vol. I, p. 25-26) 181. The starting salary for a teacher with no experience and a bachelors degree in 1991-92 in the Youngstown City School District was $20,245, which was $3,245 more than the state minimum salary schedule required. (Defendants' Trial Ex. No. 22a, and Ohio Revised Code 3317.13 (effective 7/26/91)) 182. In school year 1991-92, Youngstown City School District paid its teachers in excess of $7.5 million beyond that required by the state minimum salary schedule. (Defendants' Trial Ex. No. 22a; Ohio Revised Code 3317.13 (effective 7/26/91)) 183. By closing a school building, the Youngstown City School District can save an estimated $200,000-$300,000 per year. (Hiscox Deposition, Vol. I, p. 91) 184. Despite a report which made a recommendation to close ll buildings from 1984 to 1992, Youngstown City School District closed no buildings. (Hiscox Deposition, Vol. I, p. 78 and Ex. No. 7, recommendation No. 6) 185. Youngstown took advantage of an energy assistance loan to obtain new windows and heat controls for buildings throughout the district. (Hiscox Deposition, Vol. II, pp. 127-128) 186. Youngstown City School District failed to apply for school building assistance funds at any time that funds were made available. (Plaintiffs' Trial Ex. Nos. 377, 378 and Stip. Ex. No. 45) 187. On February 2, 1990, Youngstown City School District was informed that they were in compliance with all state minimum standards. (Stip. 99) 188. All of Youngstown's high schools are accredited by the North Central Association. (Marino T.p. 3329) 189. Youngstown City School District was informed on July 18, 1991 that its special education program was in substantial compliance with all special education standards following its last evaluation. (Plaintiffs' Trial Ex. No. 288) 190. Youngstown offered no independent expert testimony to prove that it does not have the means to comply with state minimum standards. 191. Youngstown offered no independent expert testimony to prove that its revenues did not keep pace with inflation. In fact, Youngstown's expert stated that Youngstown's revenues did out-pace inflation from 1979 to 1987. (Plaintiffs' Trial Ex. No. 103, p. 6) VII. SCHOOL DISTRICT BORROWING 1. Stipulations 22 through 45 and Stipulation Exhibits 20 through 26 deal with the requirements that school districts engage in mandatory borrowing and the magnitude and effects of those requirements. A. THE OFFICE OF SCHOOL MANAGEMENT ASSISTANCE 1. The Office of School Management Assistance within the Ohio Department of Education is under the Division of School finance. (Tavakolian Depo. 66) 2. The Office of School Management Assistance was one of the areas of the Ohio Department of Education assigned to Dr. Phillis. The Office was created by legislative action in 1978 following a number of school closings for lack of funds. The Office was created in conjunction with state loan funds and legislation prohibiting schools from closing their doors for lack of funds. (Phillis Tr. 1744) 3. The Office of School Management Assistance has three primary areas of responsibility within the Ohio Department of Education: (1) to provide education to superintendents, treasurers and business managers through educational seminars during the school year; (2) to administer the emergency school advancement loan program; and (3) to provide financial reorganization or consolidation. (Brown Depo. 18) 4. In 1986, the Office of School Management Assistance also became responsible for the administration of the spending reserve loan program. (Brown Depo. 18) 5. The Office of School Management Assistance provides advisory assistance to school districts in financial distress but does not provide direct financial assistance. (Brown Depo. 35) 6. The Division of School Management Assistance does a two year cash audit as part of the emergency school assistance loan process. The Division also does staffing analysis and looks to see if the general fund is supporting other funds such as cafeteria fund. (Brown Depo. 93-94) 7. Generally only borrowing authority available to a school district to avoid a year-end deficit is the spending reserve loan authority or the emergency school assistance loan authority. (Brown Depo. 43) B. SPENDING RESERVE LOANS 1. Stipulations regarding the operation of the Spending Reserve loan program are numbered 26 through 30, appearing at pages 5 through 7 of the Stipulation document. In addition, Stipulation Exhibits 20 and 21 relate to the operation of the Spending Reserve loan program. 2. The first type of State mandated loan is spending reserve loan. The amount of a school district's spending reserve is based on the value of tangible personal property tax that the district is entitled to receive. The amount of tangible personal property tax varies widely from district to district. The number of public school districts that have been required to apply for and take spending reserve loans has increased from year to year. (Russell Depo. 68; Revised Code Section 133.301) 3. Under the spending reserve loan program, school districts are permitted to borrow against a subsequent year's revenue receipts if at the end of a fiscal year, the district is without sufficient funds to pay committed expenses and if the Superintendent of Public Instruction approves such borrowing. Revised Code Section 133.301 (Phillis Tr. 1745-46; Stip. 23) 4. Spending reserve loans include an obligation on the part of the school district to repay both the principal and interest on the loan. (Revised Code Section 133.301; Sanders Tr. 30) 5. The spending reserve loan procedure was initially created in 1986 as a result of the fiscal year change, changing the January 1 to December 31 school fiscal year to a July 1 to June 30 fiscal year. Property taxes continued to be collected on a calendar year basis, and the proceeds from the collection in the first half of the year are less than the proceeds from the second half collection. The provision for borrowing a portion of the second half collection was made to permit school districts to avoid having a year end deficit. (Brown Depo. 42-43; Phillis Tr. 1745-46) 6. Initially, the legislature intended to phase out the Spending Reserve program, but, as more and more school districts became dependent on the program, it became a permanent part of Ohio's funding legislation. (Phillis Tr. 1745-46) 7. In order to be approved for a spending reserve loan, a school district must establish that it has exercised all available revenue options and will, in the absence of such a loan, incur a deficit at the end of the fiscal year. (Phillis Tr. 1748; Stip. 30) 8. The amount of a school district's spending reserve will vary with the extent of tangible personal located in the school district. Generally, low valuation districts have less tangible personal property. (Revised Code Section 5705.29; Brown Depo. 44; Stip. 26) 9. Generally, tangible personal property tax is the most volatile of the taxes for the operation of public schools. Due to the application of different tax rates to different types of property, there is greater loss in revenue from the loss of tangible personal property value than from the loss of real property value. (Brown Depo. 26; Russell Depo. 148) 10. The Department of Education advocates that districts begin the spending reserve loan process by June of the fiscal year before the year they expect to end in a deficit. In order to participate in the spending reserve loan program, a school district must include a spending reserve amount in its tax budget. School district tax budgets must be adopted in January of each year for the coming fiscal year commencing the following July 1. The spending reserve provision anticipates a deficit to occur at the end of the coming fiscal year (June 30), some eighteen months away. (Brown Depo. 46-50; Stip. 24) 11. The Superintendent of Public Instruction is required to annually submit to the General Assembly a comprehensive report of school district spending reserve borrowings. The aggregate amount of spending reserve borrowing approved, and the number of districts approved for spending reserve borrowing in each year from 1986 to 1992, is truly and accurately represented at Stipulation Exhibit 20. (Sanders Tr. 329; Stip 25; Stip. Exh. 20) 12. Each of the districts receiving approval for a spending reserve loan had expenditures that exceeded the combination of revenue and any carry-over balance that the district may have had. (Sanders Tr. 330) 13. The only limitation on the maximum amount that can be approved for borrowing under the spending reserve loan program is the amount of tax revenue to be received by the school district during the first half of the following fiscal year. (Brown Depo. 53) 14. A spending reserve loan in excess of a school district's spending reserve amount may be granted at the discretion of the Superintendent of Public Instruction. For the 1991-92 year, 17 of the 165 spending reserve loans approved by the Superintendent of Public Instruction were loans in excess of the district's statutory spending reserve loan amount. (Brown Depo. 52, 59; Stip. 24) 15. Although there are guidelines available for the submission of a request for a spending reserve loan, the Superintendent of Public Instruction has no written guidelines or criteria for the approval of spending reserve loans in excess of a district's spending reserve. (Brown Depo. 55; Stip. 28, 29) 16. No reductions in program or expenditures is required for the approval of a spending reserve loan. (Brown Depo. 57; Stip. 27) 17. Any time a school district borrows an amount against next year's taxes, that district is taking away available resources for operations for that fiscal year. A school district can get into a spiral where it is continually borrowing and paying back the following year. A school district, therefore, is always taking away from the future. Any time a school district does such borrowing into the future, it robs future generations of children. (Brown Tr. 5482; Brown Depo. 60) 18. The statutory spending reserve amount for the Cleveland City School District is in the neighborhood of $19 million. Cleveland borrowed more than that amount under the spending reserve loan program for each year from 1989 through 1991, with loans of $40 million in 1991, $35.5 million in 1990, and $35 million in 1989. (Brown Depo. Exh. 1, p. 2; Brown Depo. 61) 19. The statutory spending reserve limit for the Akron City School District is between $6 and $7 million per year. That school district borrowed nearly twice that amount each year from 1986 to 1992. (Brown Depo. Exh. 1, p. 1; Brown Depo. 62) 20. Dayton and Hamilton City Schools have also borrowed substantial amounts in excess of their statutory spending reserve amounts. (Brown Depo. 63) 21. Since 1989, the numbers of school districts being approved for spending reserve loans have grown as well as the total amounts approved for borrowing. (Brown Depo. 65) 22. The Superintendent of Public Instruction now recommends every district include the proceeds of a spending reserve loan in its annual tax budget. (Brown Depo. 70) 23. Presently, most school districts include anticipated operating deficits and spending reserve loan amounts in their tax budgets. (Brown Depo. 74) 24. The $88.8 million reduction in foundation funds in January, 1992 caused some districts to seek spending reserve loans. Some had not anticipated those needs in their budgets. Those districts were required to amend those budgets before being approved for spending reserve loans. (Brown Depo. 72) 25. Reports regarding the operation of the spending reserve loan program go to the General Assembly twice per year. (Brown Depo. 58) 26. Van Keuren Deposition Exhibit 2 is a composite year end report of school district spending reserve loans as of February 14, 1992. Each of the loans reflected on that Exhibit has been approved by the Superintendent of Public Instruction. (Van Keuren Depo. 79) 27. School districts are required to borrow under the spending reserve loan provisions as a condition of borrowing under the emergency school assistance loan provisions. (Van Keuren Depo. 75) C. THE OPERATION OF THE EMERGENCY SCHOOL ASSISTANCE LOAN PROGRAM 1. Stipulations regarding the operation of the emergency school assistance loan program are numbered 30 through 45 and include Stipulation Exhibits 22 through 26. 2. School districts unable to meet their financial commitments through the use of spending reserve loans are then required to seek approval for emergency school assistance loans. (Russell Depo. 69; Stip. 32; R.C. Section 3313.483) 3. The process known as the "Loan Fund" began in 1978 when districts were prohibited from closing for lack of funds. Initially, the money was borrowed from the state, and paid back over the next two years. The Office of School Management Assistance within the Department of Education was created at that time to oversee the loan fund process. (Brown Depo. 76; Tavakolian Depo. Exh. 5; Tavakolian Depo. 120) 4. In 1989, the loan fund legislation was amended such that loans were no longer made by the State but from commercial banks. (Brown Depo. 78) 5. Emergency school assistance loans are second tier of borrowing for school districts that are in need of greater amounts of additional revenue than available under the spending reserve loan program. Since 1978, 273 school districts have borrowed over $389 million under the emergency school assistance loan program. The bulk of these funds do not represent loans from the state of Ohio; rather, they represent loans from private institutions, such as banks and other lenders. Sixty percent of that borrowing has taken place in the last three fiscal years: 1993, 1992, 1991. (Phillis Tr. 1761; Brown Tr. 5495; Sanders Tr. 330-331; Pl. Exh. 152, p. 4; Tavakolian Depo. 116) 6. The procedures followed in applying for an Emergency School Assistance loan are contained in Brown Deposition Exhibit 3, a copy of which is sent to each school district each year. (Brown Depo. 100) 7. Under the emergency school assistance loan program, a school district which projects an operating deficit must first adopt a resolution setting forth that anticipated deficit. That resolution is certified to the Superintendent of Public Instruction and the Auditor of State, who then conducts an audit of the school district's finances to determine whether the district will indeed incur a shortfall of operating revenue after using all available resources (including spending reserve loans). School districts certified by the State Auditor to have projected operating deficits have no choice but to apply for an emergency school advancement loans. (Sanders Tr. 332; Phillis Tr. 1749-50; Brown Tr. 5461-62; Brown Depo Exh. 3 p. 1; Brown Depo. 83, 92; Van Keuren Depo. 58; Stip. 31) 8. Brown Deposition Exhibits 21-23 are documents used in the process of approving an emergency school assistance loan. (Brown Depo. 251 and 254) 9. Emergency school assistance loans no longer represent a loan of state funds, but constitute approval of the Controlling Board to enter into a loan from a bank or other lending institution. (Russell Depo. 76) 10. Generally, the Department of Education does not participate in finding a lender for schools; Cincinnati was an exception due to the size of the loan. (Brown Depo. 251, 254) 11. The Controlling Board has never ultimately refused to approve an emergency school assistance loan. The Superintendent of Public Instruction has never declined to recommend such a loan, though there have been negotiations with school districts applying for such loans. (Brown Depo. 147; Stip. 37) 12. If the Auditor verifies the anticipated cash flow deficit after all available sources of revenue (including the use of spending reserve loans) are taken into account, the district is then required to request a loan from a local lending institution, commercial bank, underwriter or other prospective lender. Rejection of the district's initial request by a lending institution is an essential step in the loan fund process. (Brown Depo Exh. 3 p. 1; Brown Depo. 83; Stip. 32) 13. The Auditor of State charges $25.00 per hour for its examiners to be on site at the school district. (Brown Tr. 5461-62; Brown Depo. 97) 14. The Auditor's fee is charged to, and must be repaid by, the school district. The amount of that fee is added to the loan that must be repaid by the district. (Brown Tr. 5515; Van Keuren Tr. 4757-58) 15. The audit connected with the most recent emergency school assistance loan for the Cincinnati City School District cost approximately $50,000. (Revised Code Section 3313.483; Van Keuren Tr. 4757-58) 16. With reference to the State Auditor's charges, in some instances the State of Ohio is not only forcing the school districts to borrow funds by implementing State budget cuts, but also is charging school districts for this "privilege" by telling them that they must pay the Auditor's fee. (Brown Tr. 5516) 17. The audit conducted by the Auditor of State in connection with an emergency school assistance loan takes about two months. If a deficit is certified, the Superintendent of Public Instruction is required to apply for a loan for the school district if the district fails to do so. (Brown Depo. 91-92) 18. The Department of Education recommends that school districts anticipating a shortfall in operating revenue begin the emergency school advancement loan process in May or June of the year prior to the shortfall in order to have the loan approved in time for the October 1 final appropriations deadline. (Brown Depo. 88-89) 19. Emergency school assistance loans are repaid by the state diverting funds otherwise available to the school district under the school foundation program to the commercial lender for repayment of principle and interest on the loan. (Phillis Tr. 1753-54; Sanders Tr. 338; Brown Depo. Exh. 12, p. 2; Brown Depo. 154; Stip. 43) 20. As much as 30 percent of a school district's foundation payments have been diverted to private lenders for the repayment of the principle and interest on an emergency school assistance loan. (Brown Depo. 168) 21. School districts are authorized to pledge future payments of school foundation funds as security for indebtedness other than emergency school assistance loans. No school district has yet pledged the same foundation payment twice, but such a circumstance is a possibility. (Brown Depo. 170) 22. All emergency school assistance loans were required to be repaid within two years prior to the passage of Senate Bill 289. Now some of those loans may remain outstanding for up to ten years. (Van Keuren Depo. 58; Phillis Tr. 1751-52) 23. As of 1992, "stretch loans," repayable within ten years, could be made if the amount borrowed was greater than $25 million or 15 percent of the school district's budget. (R. C. Section 3313.483; Brown Depo. 78; Sanders Tr. 336) 24. A second emergency school assistance loan in excess of 7 percent of the school district's general fund will result in a district being placed under the supervision of the Superintendent of Public Instruction. Special legislation permits Cleveland to be the only district in the State with two loans which is not under state supervision. (Russell Depo. 70; R.C. Section 3313.4810) 25. In event of passage of an additional tax levy after approval of an emergency school assistance loan, the school district is required to borrow in anticipation of the receipt of the additional tax levy revenue in order to repay the loan. (Brown Depo. 84) 26. Many loan fund districts have tried unsuccessfully to pass levies on more than one occasion to avoid forced borrowing. It has become more difficult for school districts to pass operating levies. (Brown Depo. 2132- 14) D. MANDATORY REDUCTIONS IN SCHOOL DISTRICT EXPENDITURES 1. The Department of Education requires that school districts seeking a loan submit a plan of reduction of school district expenditures in an amount sufficient to permit repayment of the principle on the emergency school assistance loan. The Department does not advise school districts on what to cut, but does monitor the cuts to determine that no provision of a negotiated collective bargaining agreement is violated and that the proposed reductions are capable of being made. The Department of Education does not, however, encourage the reduction in non-required transportation services or the reduction of extracurricular programs. (Van Keuren Tr. 4767; Brown Depo. 126, 198; Tavakolian Depo. 80; Russell Depo. 72; Van Keuren Depo. 61; Stip. 32) 2. The Superintendent of Public Instruction is required to review and evaluate each plan of reduction submitted in connection with a school district's request for an emergency assistance loan. (Stip. 33) 3. The expenditure reduction plan for an emergency school assistance loan requires a repayment schedule in amounts sufficient to permit repayment of the principal amount of the loan. The reduction plan does not require the repayment schedule to contain amounts necessary to pay the interest on the emergency school assistance loan. (Stip. 36) 4. Spending reserve loans are required to be taken as a condition of receiving an emergency school assistance loan. The plan of reduction submitted in connection with the emergency school assistance loan process does not include reductions sufficient in amount to repay the principle or interest on the spending reserve loan. Thus, for most school districts with outstanding emergency school assistance loans, subsequent borrowing under the spending reserve loan provisions will be required. (Brown Depo. 151; Russell Depo. 73; Stip. 36) 5. Teaching contracts cannot be terminated for lack of funds. Provisions for reduction in force (suspension of teaching contracts) are not available to school districts based on lack of funds. (R. C. Sections 3319.16 and 3319.17; Brown Depo. 200) 6. Negotiated collective bargaining agreements often contain limitations on the ability of boards of education to reduce personnel and personnel-related expenditures. School districts may not violate the provisions of those negotiated collective bargaining agreements in connection with a request for an emergency school assistance loan. (Phillis Tr. 1752) 7. Most school districts in financial distress have attempted to reduce expenditures by all available means prior to requesting approval for an emergency school assistance loan. Thus, the range of options for further reductions is extremely limited. Typically, such districts spend 85 percent to 90 percent of their total revenue on personnel, much of which is committed by one or more collective bargaining agreements, and have no other areas in which to reduce expenditures except personnel cuts. In some cases salary costs exceed 100 percent of the school district's operating budget. (Tavakolian Depo. 87; Phillis Tr. 1751-52; Van Keuren Depo. 47) 8. The Department of Education does not require the reduction of any expenditure required under the terms of a negotiated collective bargaining agreement. (Sanders Tr. 334-335; Stip. 34, 35; Stip. Exh. 22) 9. Most reduction plans submitted by school districts in connection with requests for Emergency School Assistance Loans involve some kind of personnel cuts. (Tavakolian Depo. 130) 10. The Division of School Management Assistance does a two year cash audit as part of the emergency school assistance loan process. The Division also does staffing analysis and looks to see if the general fund is supporting other funds such as cafeteria fund. (Brown Depo. 93-94) 11. Part of the staffing analysis conducted by the Department of Education in connection with an application for an emergency school assistance loan is a comparison of the applicant school district to other districts' staffing levels in areas where minimum staffing is not mandated by regulation. The comparison districts are selected based solely on ADM and valuation per pupil. This staffing analysis assumes that districts of similar size and wealth will have similar staffing patterns in those areas. (Van Keuren Tr. 4761; Van Keuren Depo. 60; Brown Depo. 124) 12. When a spending reduction plan is presented to the office of School Management Assistance, that office does not review compliance with state minimum standards. Rather, the only function that that office does with reference to minimum standards is to perform a head count (full-time equivalency count), to determine if the remaining staffing meets minimum standards. (Brown Tr. 5510; Brown Depo. 158) 13. School district plans of reduction in connection with emergency school assistance loans, in order of magnitude include: administrators first; classroom teachers second; and support personnel third. Personnel reductions result in the largest reduction in expenditures. (Brown Depo. 204) 14. The next largest area of expenditure reductions is materials, supplies, and textbooks; then early retirement incentives, non-purchase of school busses, and reduction in maintenance costs. Textbook purchases and deferral of maintenance have usually happened before the school district has been required to apply for an emergency school assistance loan. It has become increasingly more difficult for school districts to find things to cut from their budgets. There has been a trend to increase use of student fees as a means of increasing school revenue. (Brown Depo. 205-207; Sanders Tr. 340) 15. Reduction of classroom teachers, textbooks and supplies adversely affects the level of educational opportunity for the pupils in districts participating in the emergency school advancement fund. (Brown Depo. 209; Phillis Tr. 1752) 16. As a result of the cuts a school district must make to receive a loan, educational programs are less effective while the school district is in the loan fund than they were before the district entered the loan fund. (Ocasek Tr. 2808-09) 17. With reference to Pl. Exh. 44, a July 7, 1992 letter from Carol Spangler to Charles Brown, Mr. Brown agreed with Superintendent Spangler that the referenced cutbacks in staffing and services to students are the very lifeblood of the school system. (Brown Tr. 5505; Pl. Exh. 44) 18. Pl. Exh. 232 is a memorandum from Charles Brown to Dr. James Van Keuren dated December 14, 1989 regarding the impact of insurance costs on loan fund districts for FY90. For example, the Brookfield Local School District had seen a 45 percent increase in insurance costs in that year, costing the school district an additional $222,000. Similarly, Newton Falls Exempted Village School District had seen a 65 percent increase in insurance costs, costing the school district an additional $340,000. In total, increased insurance costs had impacted 36 loan fund districts with an increase ranging from 6 percent to 69 percent and a dollar increase ranging from $12,000 to approximately $800,000. (Pl. Exh. 232) 19. School districts with an initial emergency school assistance loan are expected to check with the Department of Education before implementing new programs. (Brown Depo. 163-164) 20. Any equity funds received by a school district, which are intended to provide poor school districts with increased educational opportunities, may be required to be spent on the repayment of any outstanding emergency school assistance loan. The Department of Education encourages early repayment. (Brown Depo. 160; Brown Tr. 5512) 21. But for the equity funds provided to school districts in fiscal years 1993 and 1994, more than 70 school districts would be in the loan program, in addition to those school districts who are already participating in that program. (Brown Tr. 5496) 22. As of March 22, 1993, twenty-one of the school districts which received equity funds under H.B. 671 had applied for emergency school assistance loans. As of that date, fourteen of those districts had been certified as having an operating deficit and had either been approved by the state controlling board for receipt of a loan or had their certification pending. Plaintiff Youngstown City School District received over $2.1 million in equity funds, and was certified as having an operating deficit of $7.047 million. (Pl. Exh. 225; Stip. Exh. 16) 23. Absent additional cuts in school district expenditures or the addition of taxable value to the tax duplicate, the rate of a local school district tax levy necessary to satisfy school district indebtedness will increase from year to year. (Tavakolian Depo. 88) 24. School districts that have been unable to reduce expenditures by a sufficient amount to repay an existing emergency school assistance loan will be required to apply for a subsequent loan. No school district has ever been denied the authority to obtain such a loan. (Van Keuren Depo. 70-71; Tavakolian Depo. 133) 25. The State Board of Education has proposed the forgiveness of indebtedness for certain loan fund districts, but such proposals have not been approved. (Russell Depo. 145) 26. The Department of Education recommended to the 120th General Assembly the creation of a fund to pay the emergency school assistance loans to school districts seeking to consolidate with other school districts but which were unable to do so because of accumulated indebtedness. That recommendation was not approved. (Sanders Tr. 371; Pl. Exh. 15, p. 17) 27. There was a finding of the House Select Committee to Review and Study Ohio's Education System that school districts should be given the statutory authority to close until the district passes needed millage if the school district decides that an emergency school loan is not in the best interests of the school system. (Shoemaker Tr. 4100-4101) 28. The Youngstown City School District has been approved for a emergency school assistance loan fund, and cuts have been made as a result of preparing to enter the loan fund. The teaching staff has been cut, and in December 1993, there were 73 substitute teachers working without regular teaching contracts, because those teachers may need to be eliminated. A shortage of substitute teachers exists because there are so many substitutes who have been serving in regular positions, substitutes have no hope of obtaining a teaching contract at this time when positions are being cut, and people do not want to come to Youngstown City Schools to teach. Secretarial and custodial positions have been abolished; nutrition staff and educational assistants have been laid off. (Marino Tr. 3203) Six administrators in FY94 are trying to do the same amount of work that was done by approximately 20 people in the Department of Instruction in FY93. (Marino Tr. 3204) Since August 1992, Youngstown City Schools have cut approximately 18 to 20 central office personnel. (Marino Tr. 3354-55) Cuts to the central office staff directly impact services to students. (Marino Tr. 3435-36) E. THE MAGNITUDE OF BORROWING UNDER THE EMERGENCY SCHOOL ADVANCEMENT LOAN PROGRAM 1. From 1978 to 8/20/93, 273 Ohio school districts received emergency school advancement loans in the amount of over $389 million. (Pl. Exh. 223) 2. In FY93, 66 school districts applied for emergency school advancement loans and forty-four were approved for the amount of $113,600,000. Twenty-seven school districts received loans in that year in the amount of $94,500,000. (Pl. Exh. 223 (dated 8/20/93)) (See Brown Deposition Exhibit 17; Stip. Exh. 23 (dated 5/12/93)) 3. On or about October 26, 1993, the Ohio Department of Education issued a version of the document entitled "History of the Emergency School Advancement Loan Program." In FY94, as of 10/26/93, 50 school districts had applied for emergency school advancement loans. (Stip. 142; Stip Exh. 53) 4. Stipulation Exhibit 24 is a true and accurate list of school districts receiving emergency school assistance loans in each year from FY90 through FY92. That document reflects a total amount of school district borrowing, including principle and interest for those three years of $114,182,629.50 (Stip 39; Stip. Exh. 24) 5. Van Keuren Deposition Exhibit 1 is a quarterly emergency school assistance loan status report as of March 31, 1992. Forty-four additional loans were authorized after that report for an additional $102 million. (van Keuren Depo. 72) 6. The composite spending reserve borrowing for fiscal years 1986-1992 for the State of Ohio was as follows: FISCAL YEAR NUMBER OF SCHOOL DISTRICTS TOTAL APPROVED FOR BORROWING 1986 129 $173,453,435.00 1987 114 141,715,879.00 1988 89 137,462,400.00 1989 100 114,429,253.00 1990 120 115,406,169.00 1991 129 121,581,281.00 1992 151 152,298,399.00 (Stip. Exh. 20; Brown Depo. Exh. 15; Brown Depo. 189) 7. Brown Deposition Exhibit 16 is a copy of a weekly loan report indicating the status of school districts in the emergency school assistance loan program as of December 21, 1992. The document does not reflect the approval of loans for Bridgeport, Southern Local in Columbiana County or Cleveland. (Brown Depo. 190; see also Van Keuren Depo. Exh. 16, current as of 12/14/92; Stip. Exh. 54, current as of October 26, 1993) 8. Pl. Exh. 224 is a list of school districts which have participated in the state loan program between the years of 1979 and 1992. Plaintiff Southern Local School District received an emergency school advancement loan in FY92 for $195,000. Many school districts in Ohio have received multiple emergency school advancement loans. Southern Local School District in Columbiana County has received six emergency school advancement loans since 1979. Union Scioto Local School District in Ross County has received four such loans. (Pl. Exh. 224) 9. Pl. Exh. 226 is a report from Charles Brown to Jim Van Keuren detailing spending reserve borrowing from FY86 through FY92 (as of February 14, 1992) According to that document, 330 different school districts received spending reserve loans in that time period, and many of those districts received multiple spending reserve loans. Youngstown City School District received a spending reserve loan of $2 million in 1989, $1.5 million in 1990 and $1.83 million in 1992. Plaintiff Southern Local School District in Perry County received a spending reserve loan of $12,500 in 1991 and $16,000 in 1992. (Pl. Exh. 226; Pl. Exh. 227) F. TRENDS IN BORROWING 1. The majority of loan fund districts are those with low property valuation. (Brown Depo. 221; Tavakolian Depo. 139) 2. The number of school districts required to borrow sequential emergency school assistance loans has increased from year to year. The trend toward increased borrowing is a matter of concern to the State Department of Education. (Russell Depo. 74) 3. A number of school districts have received as many as six consecutive emergency school assistance loans. For some, borrowing has become a way of life. (Phillis Tr. 1755) 4. School districts that have entered into consecutive emergency school assistance loans have tended to borrow more money with each subsequent loan. As a rule of thumb, school district indebtedness, if not decreased through a reduction of expenditures or an increase in revenue will tend to double each year. (Brown Depo. 192) 5. Districts that participate in the "loan fund" are often districts that have been unsuccessful in passing additional local tax levy millage on more than one occasion. In such instances, Department of Education representatives discuss the possibility of transfer of students and consolidation. (Van Keuren Depo. 45) 6. There are loan fund districts that would require more than 15 mills to get out of the loan fund; such a levy is considered to be extremely large and those districts will likely not be able to pass that much additional millage. The Department of Education encourages such districts to consider dissolving or consolidation. (Russell Depo. 144) 7. A school district property tax levy in excess of 10 mills has very little chance of passing except in dire circumstances. (Brown Depo. 215-216) 8. Some school districts presently in the loan fund are unlikely to ever get out of the loan fund. The Department of Education will conduct consolidation studies for such districts. (Brown Depo. 216-217) 9. Consolidation of school districts presents the concern of joining small poor school districts together to create a large poor school district with no improvement in the level of available revenue for the consolidated district. (Brown Depo. 220) 10. Four of the big eight city school districts have been or are presently in the loan program. These are Youngstown, Akron, Cleveland and Cincinnati city school districts. (Brown Tr. 5463) 11. President Ocasek is aware of the magnitude of indebtedness being incurred by public school districts for the operation of schools in Ohio. President Ocasek also agreed that the indebtedness is imposed upon school districts themselves, as opposed to the State. Both the numbers of school districts engaging in borrowing of funds, and the magnitude of the borrowings have increased in recent years. Unless there is a change in the method by which public schools are funded, that circumstance is likely to continue. (Ocasek Tr. 2796-98) 12. In January of 1992, school foundation funds were reduced by $88.8 million. As a result of that reduction, school districts were forced into the loan fund that otherwise would not have been in the loan fund. (Van Keuren Depo. 95) 13. Some already approved loan fund districts had to come back for more money, and some in process had to increase the amount of the loan request because of the reduction in state appropriations. (Brown Depo. 75; Tavakolian Depo. 208) G. SPECIFIC LOAN DISTRICTS, INCLUDING PLAINTIFF'S 1. President Ocasek assisted the Akron City School District in obtaining emergency school assistance loans. Akron made substantial cuts to keep afloat, and the District is still in need of additional money. The cuts that were made included matters that related to educational programs. (Ocasek Tr. 2808) 2. The Cincinnati School District became indebted to such a degree that it could not possibly pay back its loan within two years. The General Assembly amended the emergency school assistance loan legislation to provide for an option of a ten year pay back. Pursuant to that option, the Cincinnati School District has borrowed in the range of $48 million to $50 million. (Phillis Tr. 1760; Sanders Tr. 336) 3. Cleveland is the only school district in the emergency school assistance loan program that has not been required to borrow a spending reserve in addition to the emergency school assistance loan. Cleveland's loan of $75.7 million for six years includes the equivalent of a $44 million spending reserve loan for which it had been previously approved and an additional amount of $31.7 million. (Brown Depo. 152-153; Goff Depo. 147; Sanders Tr. 336) 4. The most common cause of districts in Area 5, the area including Plaintiff Dawson-Bryant Local School District, going into the loan fund has been a steady erosion of the difference between revenue and income due to inflationary increases. (Taylor Depo. 143-44) 5. Plaintiff Northern Local School District is the only school district in Perry County which has not received an Emergency School Advancement Loan. (Hill Depo. 39) 6. Northern Local Schools is not a loan fund district but is considered borderline. (Brown Depo. Exh. 16; Brown Depo. 221) 7. The Southern Local School District borrowed money through the Emergency School Assistance Loan Program in FY92. As a prerequisite to entering the program, the district was required to take a spending reserve loan in the amount of $16,000. (Spangler Tr. 484-87) The district was required to submit a plan of repayment and expenditure reduction to the Department of Education. In FY91, the district spent $3,485 in general fund expenditures per pupil, and that figure was reduced to $3,408 per pupil in FY92. The district was required to report to the Department of Education on its status in the Emergency School Assistance Loan Program and the status of the expenditure reduction plan for FY92. Reductions included one principal, one library aide, two instructional aides, one custodian, one and one-half classroom teachers, one educational service personnel teacher (a physical education teacher), one part-time food service worker, and other reductions in personnel costs. (Spangler Tr. 493; Pl. Exh. 44, p. 2) The district knew that it was going broke for a number of years and had reduced materials, supplies, and equipment in previous years. (Spangler Tr. 653) 8. In August 1991, the Department of Education sent a letter to the Superintendent of Southern Local detailing a management review conducted by the Department. (Spangler Tr. 48; Pl. Exh. 42) This review was conducted before expenditure reductions were implemented by the district. Section 4 of that document details quantifiable state minimum standards that were exceeded by the district at that time in areas of staffing or personnel expenses. For items A through E, the analysis showed that the Southern Local School District had no expenditures above the state minimum in each of those categories. (Spangler Tr. 49394; Pl. Exh. 42, sections 4 and 5) 9. As part of the cuts at Southern Local, plans to acquire text books and updated instruction materials were put on hold, professional leave and field trips were reduced, and extracurricular programs were reduced. The district instituted a pay-to-play program to meet athletic costs and to keep programs operating. (Spangler Tr. 496) The district was making cutbacks in staffing and direct services to students and options for further expenditure reductions were very limited. (Spangler Tr. 496-497) 10. Following the reductions pursuant to the emergency school assistance loan, the amount of contact between pupils and professionals was reduced. Much support that was needed from instructional aides has been taken away. In some areas, the class size is too high for effective instruction. High school English class sizes are over 30, which is too high for those students who need individualized attention for learning writing skills. At the elementary level, the 3rd grade classes had the highest number of students with many of the classes having 30 students. Seven students were retained in that grade level, which was approximately 10 percent of the class. Retention kills a child's spirit for achievement and affects their motivation to learn for the remainder of their school career. It is obvious that the district was not providing appropriate intervention for those students who were retained. Further, because of limited financial resources, the district does not have adequate systematic intervention for students and does not meet the intent of minimum standards for student intervention. (Spangler Tr. 4979-99) 11. The principal and interest on Southern Local's loan was $211,000, with repayment of that money during FY93 and FY94. A portion of principal and interest was paid each month so that in FY93, $8900 per month was withheld from the district's school foundation check and paid to Bank One of Athens. (Spangler Tr. 500) 12. If Southern Local had to borrow more money, the Superintendent did not know where additional reductions could be made. (Spangler Tr. 502) 13. Youngstown City Schools was approved for a loan of over $7 million in 1992. (Brown Depo. Exh. 16; Brown Depo. 221; Sanders Tr. 4604) 14. Plaintiff Youngstown City School District projects a debt for the 1993-94 school year of approximately $9 million. (Kolitsos Depo. 23; Pincham Depo. 13) 15. The $9 million deficit faced by Plaintiff Youngstown City School District and the resulting emergency school advancement loan has decreased the educational opportunities available in the district by forcing the district to cut necessary staff and materials. (Pincham Depo. 48) H. RECEIVERSHIP 1. Receivership districts are those that have had more than one emergency school assistance loan, with the current loan being for seven percent or more of the district's general fund. Such districts are subject to monitoring by the Department of Education. Receivership districts are more closely monitored than other loan districts. (R.C. 3313.488, 3313.4810; Van Keuren Depo pp. 65-66; Brown Depo. 221; Phillis Tr. 1757-58; Tavakolian Depo. 134; Stip. 40) 2. The monitoring of "receivership" district is governed by the provisions of Revised Code Section 3313.483. (Brown Depo. 221) 3. Districts under receivership (that is, subject to the provisions of Revised Code Section 3313.488) are prohibited from entering into any new program, contract or expenditure without the express written permission of the Superintendent of Public Instruction. Violation of this requirement could result in a monetary penalty of up to $20,000 on the individual school officer involved. Revised Code Section 5705.412. (Brown Depo. 163-164, 226-227; Phillis Tr. 1757-58; Stip. 41) 4. Specific plans of reduction submitted to the Controlling Board by receivership district are monitored for compliance by the Department of Education and must be carried out. (Brown Depo. 226) 5. Disapproval of any school expenditure for a receivership district is rare. (Van Keuren Depo pp. 65-66; Brown Depo. 221, 242) 6. Cleveland is one of the districts which has received emergency school advancement loans. Through legislation passed by the general assembly, Cleveland was approved for a second loan without having to go into state receivership. (Goff Depo. 146; Brown Depo. 236) 7. Receivership districts are required to engage in collective bargaining with employee groups. The Department of Education does not participate in the bargaining process but monitors the agreements. (Brown Depo. 229, 242) 8. Twenty-five school districts were receivership districts as of December 23, 1992. The number of receivership districts has increased in recent years. (Brown Depo. 230, 232) 9. The number and identities of school districts subject to state supervision pursuant to Revised Code Section 3313.488 for FY88 through FY96 as of July 20, 1993, are accurately represented at Stipulation Exhibit 25. (Stip. 42; Stip. Exh. 25; see also Brown Depo. 234; Brown Depo. Exh. 1a) VIII. FACILITIES A. GENERAL 1. Superintendent Sanders remarked regarding his visits to Ohio school buildings that some students were "making do in a decayed carcass from an era long passed." And others were educated in "dirty, depressing places." At trial, Superintendent Sanders testified that the State of Ohio is not doing enough to meet the facilities' needs of public schools. (Pl. Exh. 32, p. 5; Sanders Tr. 4573) 2. The overall condition of school facilities in the State of Ohio today is worse than it was 16 years ago when Dr. Phillis became Assistant Superintendent of Public Instruction. The state is losing the battle in terms of maintenance and upkeep of its public school buildings. (Phillis Tr. 1715) 3. Throughout his travels, Dr. Phillis has observed that the demeanor and behavior of students are a function of the quality of school facilities in which they receive their educational program. (Phillis Tr. 1693-94) 4. Robert Franklin testified that the environment in which a child learns is very important. It affects a student's whole attitude. Additionally, safety considerations are paramount in Mr. Franklin's opinion. In addition to problems he encountered in Plaintiff Northern Local School District, described infra, Mr. Franklin gave examples of incidents where students have been directly affected or are eminently threatened by dangerous conditions, including: In Buckeye Local in Belmont County, 300 students were hospitalized because carbon monoxide came out of heaters and furnaces on the roof of a school. Additionally, floors were buckled to the point where elementary students were jumping from the top of one buckle to the other buckle, in a room where classes were held. In the Congress School District, one elementary school was built in 1903. The floors were so thin that one teacher, while walking across the floor of the classroom, had her heels go through the wood floor. In the basement of that school, there is a gas-fired boiler sitting on a very weak floor. If that floor gives way and the boiler crashes down, it will explode with leaking gas. That particular school district is not on the approved building list, but rather is on the list of school districts which have submitted letters of request for building assistance. (See B(15), infra.) (Franklin Depo. 241-243) 5. The condition of a school building is a factor in whether a classroom is conducive to teaching and learning. The learning environment and its cheerfulness is still obviously important today. (Schiraldi Depo. 32, 37, 65) 6. In connection with his administration of the Classroom Facilities Act and other travels as Assistant Superintendent of Public Instruction, Dr. Phillis has observed public school pupils in Flushing, Ohio, who do not have access to indoor plumbing in their elementary school building. He has observed pupils in the Edison Elementary School building in Mt. Gilead, Ohio, being housed in areas formerly used as coal bins. He has observed pupils in classrooms where water would run through the classroom whenever it rained. Teachers used wooden pallets with carpet over them to insulate the children from the water. He observed buildings in which the only library was an abandoned state library truck. He observed the Nelsonville York Elementary building which is, in his opinion, unsafe as the building is sliding down a hill. (Phillis Tr. 1691-92) 7. Representative Shoemaker described his tour in 1990 of the Eastern Brown Local School District. At Eastern Brown High School, the cafeteria is divided in half 90 that proficiency test tutoring may be done in one-half of the cafeteria. The library is divided in half so that an art class made be offered in one-half of the library. The LD classroom is a converted storage room with no windows and a floor fan for ventilation. At the Ashridge elementary School in the Eastern Brown Local School District, Representative Shoemaker visited a 1st grade class with 30 students in the class and no room to work between the desks. All supplies for the class were piled on the windowsills. The students at Ashridge Elementary eat their lunches at their desks because there is no cafeteria. At the Russellville Elementary School in the Eastern Brown Local School District, Representative Shoemaker observed 30 SBH students being educated in a converted drivers ed. simulator travel. The Russellville building has no lockers. At the Sardinia Middle School in the Eastern Brown Local School District, the library is a bookmobile which is parked behind the school building. (Shoemaker Tr. 4127-34) 8. Representative Shoemaker described the tour he took in November of 1993 of the school buildings in the Nelsonville-York City School District. One of the school buildings in the district has been closed because the back wall of the building is falling down. One of the elementary buildings in the district, which continues to house students, is sliding an inch a month down the side of a hill. The Nelsonville-York City School District pays a registered surveyor to monitor the movement of that building. At that elementary, kindergarten and reading classes take place in a rented trailer in the parking lot. At the junior high school in the NYCSD, the gymnasium, auditorium and cafeteria are the same room. There is no kitchen in this building, and food is transported from the high school for students' lunches. (Shoemaker Tr. 4124-27) 9. President Ocasek observed the Nelsonville School District facilities, and saw a very unfortunate situation. He described the middle school as being in a very deplorable condition. President Ocasek expressed Concern for the safety of the children being educated in the Nelsonville Middle School. There were gas pipes exposed in the school, and there were cracks in the wall with screws on each side of the cracks. Wire connected to screws so that maintenance personnel could measure the width of the cracks to see if the cracks were worsening. The Nelsonville Middle School is sliding down a hill. (Ocasek Tr. 2787-89) B. CLASSROOM FACILITIES ACT, OHIO REVISED CODE CHAPTER 3318 1. All school district facilities are owned by local school districts unless the facilities are leased or financed through the use of a school building assistance loan. (Stip. 126) 2. The construction of public elementary and secondary school buildings in Ohio may be and is primarily financed through the issue and sale of school district bonds upon the approval of the voters in the district. The bonds are to be repaid with the proceeds of property taxes levied on the taxable property of the school district for that purpose. (Stip. 127) 3. School districts are limited by law to a maximum bonded indebtedness of 9 percent of the district's total property valuation. This amount is exclusive of any energy assistance loans and other loans. However, "Special Needs" districts may apply to the State Superintendent for permission to exceed the 9 percent limit for total bonded indebtedness. A district may qualify as a "Special Needs" district if the Superintendent of Public Instruction finds (1) the district does not have available funds from state or federal funds to meet its projected needs, and (2) the projection of the district's growth of tax valuation during the next five years indicates a likelihood of potential growth of an average of at least 3 percent per year. (Stip. 128) 4. The Classroom Facilities Act, Chapter 3318 of the Revised Code, provides a means by which a school district may purchase classroom facilities from the state. Such purchase is contingent on the existence of state funds, the approval of a school district's requests for such funds, and the passage of a local tax levy to provide funds to repay the state. (Stip. 129) 5. Title to school district facilities built with the use of Classroom Facilities Act funds is retained by the state until the loan is repaid or a period of 23 years, whichever first occurs. If the district has not repaid the state within 23 years, the Department of Education considers the loan forgiven and makes no effort to collect any remaining indebtedness. (Stip. 130) 6. Stipulation Exhibit 45 is a list as of 12/31/92 of all districts who have received funds under O.R.C. Chapter 3318, the total amount received by the districts, the total amount repaid, and the total amount not repaid at the end of 23 years. (Stip. 131) 7. The Classroom Facilities Act, which was under Dr. Phillis' jurisdiction as Assistant Superintendent of Public Instruction, is a loan program providing funds for the construction of school facilities. The facilities are owned by the Ohio Department of Education, and the school districts participating in the Act repay all or a portion of the loan from the statutorily-required local rate of participation which will vary from district to district. Amounts unpaid at the end of 23 years are forgiven. Revised Code Chapter 3318. (Phillis Tr. 1669) 8. Funds for Classroom Facilities Act assistance are provided from amounts paid back by school districts already participating in the program, as well as appropriations from the General Assembly. Stipulation Exhibit 45 sets forth a listing of those appropriations at times relevant to this case. Classroom Facilities Act funds may become available to eligible districts that have demonstrated building needs beyond their local capacity to fund. Initially, with reference to the Classroom Facilities Act, the maximum amount of a local school district's local indebtedness was 9 percent of its total assessed valuation. (Phillis Tr. 1672; O.R.C. 133.02) 9. Plaintiffs' Exhibit 136 sets forth the formula that the Ohio Department of Education uses to determine the priority rating of school districts on the School District Building Assistance Needs List. That document also sets forth the steps applicant school districts must take to be put on the list. (Pl. Exh. 136) 10. Van Keuren Deposition Exhibit 5 is a description of the operation of the Classroom Facilities Act prepared and published by the Department of Education. (Van Keuren Depo. 102-06) 11. Between 1981 and 1991, only 24 Ohio school districts were given funds under the Ohio School Building Assistance Program. (Pl. Exh. 137) 12. In order to participate in Classroom Facilities Act funds, a district must be included on a "list" of eligible districts. Lists are only created at such time as funds are available. After reviewing the applicants, the Department of Education conducts a statewide survey to determine those districts most in need of additional facilities. (Phillis Tr. 1671-72) 13. Approval for participation for Classroom Facilities Act funding involves an inspection by the Ohio Department of Education officials and a determination of the number and percent of inadequately-housed pupils, as well as a prioritization of school district applicants based on the percentage of inadequately-housed pupils that need to be housed with state money. (Phillis Tr. 1675) 14. From 1976 to the present time, there have been three lists of districts eligible for Classroom Facilities Act funding; the initial list was prepared prior to 1976 when Dr. Phillis became Assistant Superintendent of Public Instruction. A second list was prepared in 1984 and a subsequent list in 1989. The 1989 list was revised with one additional district being included in 1991. (Phillis Tr. 1677) 15. Plaintiffs' Exhibit 378 is a list of the 44 school districts who have been approved for classroom facilities assistance pursuant to the provisions of Chapter 3318 of the Ohio Revised Code. This list was adopted by the State Board of Education on December 20, 1989, and updated in 1991. The list describes a total of over $114,000,000 in value of approved facilities needs. Of these school districts, 18 have been approved for school building assistance, passed the requisite levies, and funds have been made available for school construction. Twenty-six (26) school districts remain on the approved building list, for which no funds have been appropriated by the Ohio General Assembly. (Franklin Depo. 54; Phillis Tr. 1679-80; Stip. 132, 133) 16. All the pupils identified as "improperly housed" in 1989 in districts that have not received Classroom Facilities Act assistance continue to be improperly housed unless the school district has provided facilities without state assistance. (Van Keuren depo. 109) 17. After the State Board of Education and the State Controlling Board allocate funds to a specific classroom facilities project, the school district may then proceed to the local electors with a proposed bond issue which would bring the district's level of indebtedness at or near 7 percent of the district's valuation plus the 1/2 mill pay back. If the proposed local "pay back" issue did not pass but was close, the district would be given another opportunity. If the failure to pass was decisive, the district would revert to the bottom of the list. (Phillis Tr. 1679-80) 18. Because any school district beyond the 27 schools listed on Plaintiffs' Exhibit 378 are a least seven to nine years down the road before help will be available to them (assuming a level of appropriations by the General Assembly), the Division of School Building Assistance of the Ohio Department of Education accepts letters of intent from school districts, indicating their interest to be placed upon the approved school building assistance list. Stipulation Exhibit 52 lists those 50 school districts who have filed letters of intent with the building assistance office, including Plaintiff Northern Local School District. (Franklin Depo. 54-55; Phillis Tr. 1688-89; Stip. 137) 19. It is the intent of the State Board of Education to take care of all 44 districts set forth on the approved building assistance list, Plaintiffs' Exhibit 378, before the State moves on to any more districts. These districts must pass levies and their projects must be completed before any new schools will make it on to the approved buildings list. (Franklin Depo. 77-78) 20. Classroom Facilities Act funds do not include funds for the equipment or operation of schools, but are limited to provision of school facilities only. (Phillis Tr. 1713-14; Van Keuren Depo. 106) 21. The state has final approval in the design of facilities funded with Classroom Facilities Act funds. (Phillis Tr. 1712) 22. Hunter Deposition Exhibit 5 are the guidelines for state school building assistance projects used by all architects as the general specifications for classroom school building design. (Hunter Depo. 164-65) 23. All building assistance funds come from the state lottery. However, not all lottery profits go toward building assistance funds. In fact, the amount of monies that are available for school building assistance depends upon what is appropriated by the Ohio General Assembly. During the short time that Robert Franklin has been with the Ohio Department of Education, the yearly amounts appropriated for school building assistance ranged from $10 million to $25 million. In 1990, the General Assembly appropriated $25 million for school building assistance. In 1991, the appropriation was $25 million. However, in 1992, the Ohio General Assembly appropriated only $10 million for school building assistance. (Franklin Depo. 31, 77-82) 24. Factors that enter into the determination of eligibility for school building assistance funds include the number of inadequately-housed children and/or the condition of the facility. The rule of thumb followed by the Office of Building Assistance is that about 30 square feet per student is needed in a classroom; 125 square feet per student for an elementary and junior high school student for rest rooms, cafeteria and gymnasium; and 150 square feet per high school student for those areas. (Franklin Depo. 83-85) 25. School districts may choose not to close unneeded school buildings because to do so would result in an erosion of public support which is essential to the passing of school district operating millage. (Phillis Tr. 1853-54) 26. In addition to all current legislative authorized funds for capital improvements, there presently exists an emergency need for additional capital facilities in the amount of at least $50 million. (Van Keuren Tr. 4774) 27. Plaintiffs' Exhibit 139 is a listing of school districts in Ohio together with their assessed valuation, the amount determined to be needed pursuant to the 1990 Facilities Survey and the amount that could be raised within the 9 percent limit overall school district indebtedness. (Phillis Tr. 1706) 28. Plaintiffs' Exhibit 139 indicates that, assuming they had no other indebtedness, a substantial number of Ohio school districts could not raise sufficient funds to provide their facilities' needs assuming they were willing to tax themselves to the statutory maximum of 9 percent. (Phillis Tr. 1707) 29. Approximately 60 percent of Ohio school districts could not meet their facility needs even if they voted indebtedness to the statutory maximum of 9 percent. (Phillis Tr. 1709) 30. Perry Local School District in Lake County was able to build a $50,000,000 school building with current operating funds. Few school districts are able to undertake a construction project without first obtaining a voted bond issue. (Maxwell Tr. 248-49) C. EMERGENCY SCHOOL REPAIRS PROGRAM 1. In 1991, the Ohio Department of Education maintained an Emergency School Repairs Program. This program was advertised by the State Superintendent Public Instruction, who sent a memorandum to all 612 public school districts in Ohio, requesting them to complete applications for emergency assistance. This was done on a first come, first-served basis. The funds could be used by the school districts for repairs of buildings, child safety, removal of leaking gasoline storage tanks, replacement of boilers and heating devices, etc. Each school district that applied was eligible for a total of four grants, with each grant having a maximum amount of $50,000. (Franklin Depo. 36-40) 2. Plaintiffs' Exhibit 375 lists the 76 school districts which were recipients of emergency school repair funds for FY91. Ninety (90) school districts requested help. Of the 90 school districts that requested help, the $2,680,000 in grants would have been used up by 20 of the school districts to take care of their problems. However, the Department of Education determined to spread out the grants to help as many school districts as possible. These funds could be used only for repairs and not for additions or new buildings. (Franklin Depo. 40) 3. In FY92, and thereafter, no funds were appropriated by the General Assembly for emergency school repair. (Franklin Depo. 45) 4. With reference to the grants awarded under the emergency school repair grants, the first preference in the award of the grants were child safety issues, such as contamination of water systems because of gasoline leakage, replacement of fire alarm systems, etc. That was the number one concern of the Department of Education, and according to Robert Franklin, "it should be everyone's. [A child's] education is second to their safety." (Franklin Depo. 48-49) 5. The Office of Building Assistance does not have the authority to close any public school buildings due to any safety or code violations. In fact, the Ohio Department of Education does not inspect schools for code and safety violations. (Franklin Depo. 119-20) 6. The grants made pursuant to the Emergency School Assistance program did not meet all the needs of the schools who applied, nor those who were on the approved list. The grant only helped the school district with, perhaps, one problem. Mr. Franklin testified that it would be beneficial if the State had an Emergency School Repair Fund on a yearly basis. (Franklin Depo. 51) 7. Jack Hunter, Supervisor of School Facilities for the Ohio Department of Education, testified that, with Robert Franklin, he visited school districts who had applied for emergency building assistance when the program was in existence. The Ohio Department of Education had numerous applications for these funds. Mr. Hunter visited every school and assessed the problem and tried to assign a dollar value to it. However, there was not "anyway near enough money to solve [the school districts'] problems, and so all we could do was just put out one little fire that they had. You know, it was pathetic, really, to--to try to judge what we would give them." (Hunter Depo. 138) 8. When the Voinovich administration entered office, there was in existence the emergency school repair program that had $2 million funding in FY91. The purpose of this program was to provide funds for emergency school repairs for school districts. Those funds would go to such problems as those experienced by Plaintiff Northern Local School District and the closing of its elementary building, and the presence of arsenic in its water, as described infra. That fund is no longer in existence, nor were any funds proposed by Governor Voinovich in his budget for emergency school repair programs. None was appropriated by the General Assembly. (Browning Tr. 4435-36) 9. Mr. Hunter testified that once the emergency building assistance program was closed out and no more monies were available, he still visited with some of the school districts who were unable to obtain needed funds through that program. He testified that these districts were still asking and pleading for money. These districts are struggling with lack of funds to solve some of their significant problems. This lack of funds to address significant facilities' problems is state-wide and not confined to any particular area of the state. For every district that has been forced to cut back in expenses, the first thing that happens is the elimination of custodians and maintenance. Mr. Hunter continued: "That's the way we operate in Ohio, unfortunately." School districts have been deferring maintenance right and left, and have been doing so for several years. Mr. Hunter testified that, with reference to facilities, school districts are going downhill quickly. (Hunter Depo. 140-42) D. 1990 OHIO PUBLIC SCHOOLS FACILITIES SURVEY 1. In 1989 and 1990, the Department of Education conducted a statewide survey of school buildings pursuant to direction of the General Assembly. The survey cost approximately $3.5 million and included on-site review by a designated architect of each school building in the state that housed pupils. The results of that survey were compiled and published by the Department of Education. Plaintiffs' Exhibit 14 is the 1990 Ohio Public Schools Facilities Survey. (Van Keuren Depo. 110-115) 2. The 1990 Ohio Public School Facilities Survey identified $10.2 billion in facilities' needs for public primary and secondary schools in Ohio. The $10.2 billion figure represents the amount required to bring all the public primary and secondary schools in Ohio up to minimum standards. (Pl. Exh. 14; Franklin Depo. 33, 52; Stip. 135) 3. Plaintiffs' Exhibits 318 through 326 are-the area reports associated with the 1990 Facilities Survey, providing a detailed facilities' report for each school district in Ohio. 4. The 1990 Ohio Public School Facilities Survey was also accompanied by the individual studies that were done for each school district within the state. These studies list specific schools within each school district and what repairs/renovations/additions/new construction had to be done. (Franklin Depo. 219-20) 5. Stipulation Exhibit 46 is the 1990 Ohio Public School Facilities Survey for Plaintiff Dawson-Bryant Local School District. The survey identified $14,975,241 in facilities' needs. Dawson-Bryant has a new school building project at the present time. 6. Stipulation Exhibit 47 is the 1990 Ohio Public Schools facilities Survey for Plaintiff Lima City School District. The survey identifies $42,495,955 in facilities' needs. 7. Stipulation Exhibit 48 is the 1990 Ohio Public Schools Facilities Survey for Plaintiff Northern Local School District. The survey identifies $13,812,376 in facilities' needs. 8. Stipulation Exhibit 49 is the 1990 Ohio Public Schools Facilities Survey for Plaintiff Southern Local School District. The survey identifies $7,363,528 in facilities' needs. Southern Local has a new elementary and middle school complex which addresses some of these needs. 9. Stipulation Exhibit 50 is the 1990 Ohio Public Schools Facilities Survey for Plaintiff Youngstown City School District. The survey identifies $66.925.350 in facilities' needs. 10. Stipulation Exhibit 51 is a copy of a cover letter sent to each school.district superintendent regarding the 1990 Ohio Public Schools Facilities Survey. That letter notes that the Department of Education was charged by the General Assembly to determine the amount of funds necessary to bring all facilities into compliance with: -- all state building code provisions __ all state provisions related to asbestos removal __ all other state and local provisions related to asbestos removal -- all other state and local provisions related to safety and health 11. The Department of Education also commissioned the development of a video presentation (Plaintiffs' Exhibit 451) describing the Facilities Survey. The video presentation was used at regional meetings in order to heighten the awareness of the public and the legislature. (Phillis Tr. 1699-1701) 12. The Facilities Survey was conducted through the use of architects who were instructed to apply uniform criteria in the analysis of each school building that was visited. All school buildings housing pupils in the state were included in the study. Contingency funds and "soft money", such as architects' and bond counsel fees, were excluded from the results of the study. (Phillis Tr. 1696-98) 13. Jack Hunter helped design the survey forms and helped with the training of the architectural firms that completed the 1990 Ohio Public Schools Facilities Survey. He testified that the Facilities Survey was done very professionally and that he was satisfied with the methodology utilized to complete the survey. (Hunter Depo. 65-66) 14. In the opinion of Robert Franklin, the Building Assistant Supervisor for the Ohio Department of Education, the 1990 Ohio Public School Facilities Survey was "well done." Mr. Franklin agreed with the methodology utilized by the architects in the study, particularly because all architects met and used the same criteria. Ohio was the first state to provide such a guide for planning for school districts. (Franklin Depo. 236-37) 15. As of 1993, according to the testimony of Robert Franklin, the figure set forth in the Facilities Survey is very realistic. Between 1989 and 1993, there has been an 11 percent to 16 percent increase in construction costs. (Franklin Depo. 220, 228-29) 16. Construction costs increase at a rate of approximately 4 to 5 percent per year. As projects come up for approval, the Department meets with school districts and increases the amount of state funds for projects as needed. School buildings cost approximately $85 to $90 per square foot to build, with costs increasing. (Van Keuren Depo. 106) 17. The architects who completed the Facilities Survey were in every public school building within the state. (Franklin Depo. 235) 18. Robert Franklin testified that the need for building assistance monies, as set forth in the 1990 Ohio Public Schools Facilities Survey, is real. However, he added that with the way the State is trickling money into the program, it will take forever to complete the necessary work. Mr. Franklin expressed his concern for the children of Ohio thusly: "My main concern is that I'm afraid that before we get the buildings that are in real bad shape fixed, that maybe one of our kids will get hurt or maimed. And I can foresee that, if we don't take some action and -- and get some newer school buildings in place." Mr. Hunter further testified: "So how many $25 millions [of yearly facility appropriations by the General Assembly] will go by before we can get [school buildings] up to standard?" (Franklin Depo. 33, 239) 19. The recommended guidelines of square feet per student are set forth in the 1990 Ohio Public School Facilities Survey, page 4, wherein it is recommended that elementary and middle school/junior high students have 125 square feet per student, and high school students have 150 square feet per student. This includes classroom space. For classrooms, the guideline is 30 square feet per student. (Franklin Depo. 222-23) 20. Standards and codes applicable to construction of new facilities are getting stiffer and stiffer as the years go on. For example, the Clean Air Act creates standards pertaining to the amount of air that circulates in a school. When students are in the halls between classes, and there is not proper ventilation, carbon dioxide is trapped, and children can get sick. Standards and codes that apply to the amount of air that must circulate are becoming more stringent. These are mandates by both the state and federal governments. (Franklin Depo. 218-19) 21. The survey of school facilities' building needs published by the Ohio Department of Education in 1990 measures the extent to which school buildings in Ohio do not comply with requirements of the building code. (Plaintiffs' Trial Ex. No. 14; Maxwell Testimony, T.p. 217-218) 22. As a general matter, existing buildings do not have to be brought into compliance with building code requirements. (Sanders Testimony, T.p. 4496; Phillis Testimony, T.p. 1826-1827) 23. The survey was conducted by private architects. There has been no independent audit or analysis of their work. (Browning Testimony, T.p. 4471) E. ARCHITECTURAL BARRIER ABATEMENT 1. The 1990 Ohio Public Schools Facilities Survey reflects a total cost of $153 million to make school buildings handicapped accessible. Jack Hunter testified that he agrees with the accuracy of this figure as it applies to mobility. However, the obligations for Ohio public schools are considerably more since the passage of the Americans With Disabilities Act (ADA). For example, under the Americans With Disabilities Act, all doors in school buildings must be braille-labeled, and all school buildings must have deaf-accessible, coin-operated telephones. Accordingly, the costs of bringing public school buildings in conformance with the ADA are considerably above $153 million. Indeed, the financial obligation to make buildings handicapped accessible at the present time may exceed the cost of abating asbestos. (Hunter Depo. 166-68; Van Keuren Depo. 123; Pl. Exh. 14) 2. The 1990 Facilities Survey determined that only 20 percent of the existing public school buildings in Ohio has satisfactory handicapped access. (Stip. 135) 3. By January 25, 1995, all public schools in the State of Ohio must be handicapped accessible, as mandated by the federal government. Further, by January 25, 1992, all new schools and additions must be built so that they are handicapped, barrier-free. By July 26, 1992, all school districts are required by the federal government to have plans in effect to meet the January 25, 1995 deadline. (Franklin Depo. 203-04; Hunter Depo. 166) 4. Robert Franklin has visited over 200 school districts in Ohio in the course of performing his duties as Director of Building Assistance. Mr. Franklin is also responsible for removal of architectural barriers in compliance with the federal Americans With Disabilities Act. (Franklin Depo. 166) 5. The State of Ohio provided grants for architectural barrier abatement for fiscal years 1990 and 1991. For fiscal year 1990 and 1991, only $3.38 million was appropriated for architectural abatement among public school districts in Ohio. The numbers and amounts of these grants are set forth in Plaintiffs' Exhibits 371 and 372. Since 1991, there have been no monies appropriated by the State of Ohio for assistance to public school districts for architectural abatement. (Franklin Depo. 171-173, 182) 6. For fiscal years 1990 and 1991, school districts could apply for a maximum of three grants for architectural barrier abatement. Recipients were awarded grants on a first come, first-served basis, whether the district was wealthy or poor. Seventy-six (76) school districts applied for funds and were not awarded any architectural barrier grants. (Franklin Depo. 174-78) 7. Plaintiffs' Exhibit 374 lists those school districts that applied for architectural abatement funds from the state, and those that received funds are marked by an asterisk (Franklin Depo. 197) 8. In FY88, a federal program existed which involved matching grants to local school districts for architectural barrier abatement. The maximum amounts of the grants were $80,000. This program was discontinued so that no further funds are available to school districts from the federal government for architectural barrier removal. Plaintiffs' Exhibit 373 lists those school districts who received matching federal grants for architectural barrier removal in FY88. This program was phased out in 1990. (Franklin Depo. 167-69) 9. There are now no funds available to public school districts in Ohio from either state or federal sources for architectural barrier abatements and conformance with the requirements of the Americans With Disabilities Act. (Franklin Depo. 210; Hunter Depo. 165) 10. Since FY91, no funds for architectural barrier abatement for public schools have been proposed by the Governor, nor have any such funds been appropriated by the General Assembly. (Browning Tr. 4437) 11. Realistically, it will take more money than is presently available for removal of architectural barriers to the handicapped in order for school districts to meet the January 25, 1995, deadline. School districts are not receiving any more money to accomplish this. With less than two years to go for school districts to meet the federally-mandated deadline, much work remains to be done, including architectural design drawings and construction, aside from the obtaining of the necessary funds. (Franklin Depo. 205-07) 12. Robert Franklin testified about various costs associated with making facilities accessible to the handicapped, as required by law. These include conversion of bathrooms--$15,000 each; installation of automatic doors--$4,000 to $8,000 each; installation of elevators--$40,000 per floor; installation of a chair lift--$18,000 to $20,000 to go up ten stairs. (Franklin Depo. 201-02) F. ASBESTOS ABATEMENT 1. Starting in 1980, the federal government adopted a mandatory program in which all public schools must be inspected with reference to asbestos. That Act was rescinded by President Reagan. In 1982, the federal government adopted a mandatory inspection act for asbestos for public schools. In 1986, the federal government mandated a greater degree of inspection for asbestos in schools and passed the Asbestos Hazard Emergency Response Act This Act creates a continuing mandate for elementary and secondary schools to critically inspect their buildings, prepare a management plan for asbestos abatement, which plan must be renewed annually, and undergo tri-annual inspections by an approved certified asbestos inspector. (Hunter Depo. 33-38; Stip. 138) 2. The role of the Ohio Department of Education in asbestos abatement in public schools is strictly one of technical assistance. (Hunter Depo. 42) 3. Asbestos hazards are ranked from 1 to 4. A ranking of class 1 means that there is a health hazard and, if found, the school district must directly abate the asbestos or close off the affected area within 30 days. A rank of 2 means that there is potential for a health hazard, and if the asbestos-containing materials are damaged, then it will become a number 1 hazard. For rankings of 3 or 4, no action must be immediately taken. (Hunter Depo. 75-76) 4. Jack Hunter testified that of all public school structures in Ohio, over 99 percent have asbestos in them. Seventy-five percent (75%) have asbestos that should be abated or have a hazard ranking that would cause it to be abated either immediately or near term. (Hunter Depo. 70-71) 5. Jack Hunter testified that he has visited school districts in Ohio that have hazard 1 and 2 rankings and which have no money to abate these problems. He further testified that he is aware of public school districts in Ohio where there are number 1 asbestos hazards, and the school districts still have students and teachers in those affected areas. (Hunter Depo. 76, 83, 87, 89) 6. Asbestos does deteriorate, and this is why annual surveillance and three-year inspections are required. (Hunter Depo. 74) 7. Jack Hunter testified that, without question, asbestos is a hazard to humans. The potential for exposure to students is significant enough in any school that abatement should be given priority. (Hunter Depo. 91) 8. In 1984, the Ohio Department of Education established an ad hoc task force consisting of physicians, engineers, and persons knowledgeable about asbestos. This group estimated a cost of removing friable and damaged asbestos from the classrooms of the public primary and secondary schools in the state to be $400,000,000. At the same time, the Federal Environmental Protection Agency estimated that the cost for removal of asbestos from public primary and secondary schools in Ohio would be $500,000,000. These figures apply to friable or damaged asbestos, and not the removal of all asbestos from public school facilities. (Hunter Depo. 59-62) 9. In October 1985, the State Board of Education recommended that all school districts remove all asbestos as soon as possible, as safe as possible, from school buildings. (Hunter Depo. 91-92) 10. The 1990 Ohio Public Schools Facilities Survey identified $328,000,000 in funds needed for the abatement of asbestos in public school buildings. This figure must increase because not all school districts were included in the asbestos portion of the survey. (Stip. 140; Hunter Depo. 64) 11. The federal government initially provided some very small grants to school districts through the Ohio Department of Health to conduct the survey required by the Asbestos Hazard Emergency Response Act. The funds were limited on a first come, first-served basis to various school districts. Approximately $900,000 was made available, and only 200 of the applying school districts received a share of funds. (Hunter Depo. 44-- 45) 12. Funds are available from the federal government to public school districts through the federal program known as Asbestos School Hazard Abatement Act (ASHAA). This has been in effect for eight to nine years and is administered by the Federal Environmental Protection Agency. In 1993, school districts within Ohio submitted $120,000,000 in applications for projects which would abate class 1 asbestos hazards. Of those applications, only 29 school districts received loans and grants, consisting of $14.7 million for abatement of these number one hazards. Most, if not all, of the hazards in the unfunded projects are in areas occupied by students and are class 1 hazards. (Hunter Depo. 80-87) 13. For FY90, $18,000,000 was appropriated by the General Assembly for asbestos abatement for public schools; for FY91, the General Assembly appropriated $6,000,000 for asbestos abatement. These funds were available on a first come, first-served basis. For FY90, $140,000,000 in applications were received from public school districts for the $18,000,000 of available funds. (Hunter Depo. 53-54; Stip. 139) 14. Plaintiffs' Exhibit 370 lists those school districts who received state grants for asbestos abatement for FY90. Plaintiffs' Exhibit 369 lists those school districts who received state grants for asbestos abatement for FY91. The percentage of distribution depends upon the tax valuation per pupil of the particular school district. (Hunter Depo. 106, 115) 15. In 1990, over 240 school districts applied for $140,000,000 in asbestos abatement monies from the state. Only 63 districts received funds. (Hunter Depo. 124-26; Pl. Exh. 370) 16. For FY91, approximately 34 school districts received asbestos abatement grants. More than 158 districts which had applied for grants received none. Fifty-one million dollars ($51,000,000) was applied for by schools for 1991 asbestos abatement grants. (Hunter Depo. 128-30) 17. Since 1991, there have been no State monies available for asbestos abatement. Aside from ASHAA, the only other sources of available funds for asbestos abatement are local school district dollars. (Hunter Depo. 81; Van Keuren Depo. 132; Goff Depo. 128; Shoemaker Tr. 4108) 18. Plaintiffs' Exhibit 453 lists those applications pending from 158 school districts who have applied for State asbestos grants, and for which no monies are available from the State of Ohio. The total amount of the applications is $51,925,175 toward total project costs of $70,716,820. (Hunter Depo. 106, 126-27) 19. Plaintiff Lima City School District presently has pending an application for a State asbestos abatement grant in the amount of $1,200,000 toward a total project cost of $1,432,850. No funds are available from the State. (Pl. Exh. 453) 20. In Plaintiff Northern Local School District, there is asbestos throughout the junior high school building, as well as each of the elementary buildings. (Johnson Tr. 1554) 21. Plaintiff Northern Local School District presently has pending an application for a State asbestos abatement grant in the amount of $176,673 toward a total project cost of $187,750. No funds are available from the State. (Pl. Exh. 453) 22. Plaintiff Southern Local School District presently has pending an application for a State asbestos abatement grant in the amount of $544,839 toward a total project cost of $579,000. No funds are available from the State. (Pl. Exh. 453) 23. For FY92, the Ohio Department of Education requested from the General Assembly $10 million for asbestos abatement grants for public schools. No monies were appropriated by the General Assembly for asbestos abatement in the public schools. No request was made by the Ohio Department of Education for asbestos grants for FY93. (Hunter Depo. 134-35) 24. When the Voinovich administration came into office, there was in existence the above-described program that provided funding for asbestos abatement in public primary and secondary schools. The Administration has made no budget proposals for asbestos abatement funds for public schools since taking office, nor has the General Assembly appropriated any funds for public school asbestos abatement for the current biennium, fiscal years 1994-95. (Browning Tr. 4438-41) G. FACILITIES IN PLAINTIFF SCHOOL DISTRICTS 1. Each of the Plaintiff School Districts in this action was determined by the Department of Education to have facilities needs greater in amount than could be raised by the Plaintiffs, assuming no other Indebtedness and the passage of locally-approved bond issues to the maximum amount permitted by law. In addition to the Plaintiffs, 61 percent of the school districts in Ohio are unable to meet the amount of their facilities needs as determined by the Department of Education (assuming no other indebtedness). Revised Code Section 133.06. (Maxwell Tr. 131-134; Maxwell Depo. Exh. 3, p. 56, Exhibit 139) DAWSON-BRYANT 2. There are four buildings at Dawson-Bryant in operation. The Monitor building houses 172 kindergarten through third grade students who reside in the village of Coal Grove. Deering Elementary serves approximately 364 kindergarten through 6th grade students who live outside the village. The Intermediate building serves students in grades 4 through 6 who attended Monitor, and also houses all students of the district for grades 7 and 8. Dawson-Bryant High School serves students in grades 9 through 12. (Washburn Tr. 2347-48) 3. Dr. Lee McMurrin, superintendent of Beachwood City Schools, testified that he visited the schools in the Dawson-Bryant District and, among other facilities, observed the classrooms. He described the materials in the classrooms as being old and worn out and dated. The laboratory materials are not there for the children or teachers. He described the special education classes as being in cubbyholes that do not meet his standard. To house special education children in those types of classrooms is a disgrace to the State of Ohio and to all Americans, according to Dr. McMurrin. (McMurrin Tr. 2542-43) 4. The Monitor Elementary building has no multi-purpose room. There is no location for lunch or breakfast programs and no appropriate place for music or art to be held. There is no adequate location for a physical education program. (Washburn Tr. 2348-49) 5. Students at Monitor Elementary do not have the opportunity to engage in team sports such as basketball. It is important that students learn to work cooperatively in team activities and to learn fine and gross motor skills at an early age. The students that have attended and those that are attending Monitor Elementary are deprived of these opportunities. (Washburn Tr. 2351) 6. Kindergarten students at Monitor Elementary are inappropriately housed in a room that has exposed steam pipes that pop, crack, and distract students during cold weather. (Washburn Tr. 2349) 7. For fire drills at Monitor Elementary, students use old iron railing steps attached to the exterior of the building that are very slippery during inclement weather. (Washburn Tr. 2350-51) There is no nursing station or facilities if a student becomes ill. The library is small and dark and cannot accommodate more than ten students at a time. There is no place in the library for a student to take a book from the shelf and sit down to look at the book. (Washburn Tr. 2349-50) 8. From August 23, 1993 to August 30, 1993, the average temperature in Monitor Elementary was 94 to 96 degrees, with the central hallway near 98 degrees. (Pl. Exh. 272) 9. The Deering Elementary building is not handicapped accessible. The library is a former storage area located in the basement, which is not accessible to all students. There is a third grade student in a wheelchair who has never been to the library at Deering. That student must be wheeled outside and around the building to get into the multi-purpose room. Students at Deering Elementary have been carried up and down stairs to exit the building for fire drills and to go to classrooms or to a library. (Washburn Tr. 2355) 10. At Deering Elementary the area for parking and pick up and drop off of students is inadequate. The building has no facilities for a student who may become ill. Three Chapter I teachers are inappropriately housed in one classroom at the same time. The speech room is a former restroom. (Washburn Tr. 2353-54) 11. At Deering Elementary in the Dawson-Bryant Local School District, multi-factored evaluations for possible identification and placement of handicapped students are performed in an inappropriate area that was a closet and has one bare light bulb hanging from the ceiling and no heating or ventilation. The closet is located next to the boys' restroom, where there is a constant traffic flow. Part of the assessment calls for fine motor activities, which is extremely difficult to perform in winter with no heat in the room. (Washburn Tr. 2354-55) 12. From August 23, 1993 to August 30, 1993, the average afternoon (1:00 p.m.) temperature in Deering Elementary was 100 degrees downstairs, 115 degrees upstairs, and 115 degrees in the cafeteria. (Pl. Exh. 272) 13. The Intermediate Building at Dawson-Bryant has been cited for being out of compliance with EPA emission standards. The former superintendent signed an agreement indicating that the building would be in compliance with those standards by July 1992. The building is still out of compliance with EPA standards. (Washburn Tr. 2355) 14. The coal heating system at the Intermediate Building is a health hazard for staff and students. The curriculum supervisor at Dawson-Bryant had a severe asthma attack as a result of the coal dust at Intermediate. The limited technology in the building creates problems with keyboards because of the coal dust. The coal dust can be seen in the air. The maintenance staff cleans the building thoroughly at night, but students' desks are covered with coal dust in the morning. A parent withdrew a student from the Dawson-Bryant Schools to avoid exposure of the student to the coal dust at Intermediate. (Washburn Tr. 2356, 2358) 15. At the Intermediate Building, the room used for a band room is inappropriate. It is a former coal bin with no ventilation, no windows, and no acoustic treatment whatsoever. Students complain of headaches after leaving band class. (Washburn Tr. 2356-57) 16. The Intermediate Building has no kitchen or cafeteria, and no free breakfast program can be offered. The building has no science labs and technology is limited. There is one shower room for both boys and girls. There is no art or music room. (Washburn Tr. 2356-57) 17. At the Intermediate Building at Dawson-Bryant, a special education class is held in a former storage area; the Ohio Department of Education, Division of Special Education stated that the classroom needed to be moved from that area. The classroom has not been moved because there is no place to move the classroom. (Washburn Tr. 2355-59) 18. From August 23, 1993 to August 30, 1993, the average temperature in the Intermediate Building was over 95 degrees. (Pl. Exh. 272) 19. At Dawson-Bryant High School, the library is located in a modular building that is separate from the high school building and is not readily accessible to students. There is no band room or music room in the high school, so the band practices on the stage, while physical education classes are taking place in the gym. Those activities interfere with each other. (Washburn Tr. 2358-59) 20. In the science lab at Dawson-Bryant High School, the water and gas stations do not work. Opportunities for experiments are inadequate. Because of the lack of opportunity and the lack of resources, the interests in the advanced sciences has declined. (Washburn Tr. 2359-60) 21. The one art class that is offered at the Dawson-Bryant High School is held in the cafeteria. (Washburn Tr. 2360) 22. Two special education classes at Dawson-Bryant High School are held in storage areas. (Washburn Tr. 2360-61) 23. The Dawson-Bryant High School cafeteria is not large enough to serve all the students from all the schools that are bussed in from other buildings. Students at the high school and at the Intermediate building have open lunch -- lunch on their own out of the buildings without supervision. The district cannot house all of the students for lunch because the kitchen and cafeteria are too small. (Washburn Tr. 2361-62) 24. The Dawson-Bryant Local School District is located in the southern part of the State, and it is not unusual for the district to have high temperatures in the buildings, both at the beginning of the school year and at the end of the school year. It is not realistic to expect the students to be actively involved in learning when temperatures are in excess of 100 degrees. (Washburn Tr. 2363-64) School districts are required to be open for instruction with pupils in attendance for not less than 182 days (including 2 days of professional meetings) in each school year, with five days permitted for calamity days, such as hazardous weather conditions including snow or heat. Any days exceeding the five days must be made up. (R.C. 3313.48; 3317.01(B)) PTO organizations at both Monitor and Deering Elementary Schools have volunteered to undertake fundraising projects to provide air conditioning for those facilities. The wiring in those two buildings, however, is not adequate and would not handle the additional current that would be required. At Monitor, if more than three teachers plug in fans at the same time in the building, the breaker kicks because the wiring will not handle the current. The district could not afford to re-wire both of the buildings to remedy the problem with the current or to install the air conditioners to be purchased by the parent group. (Washburn Tr. 2362-65) 25. The electrical wiring, especially at Monitor, limits the use of technology in the elementary building. (Washburn Tr. 2365) 26. The facilities at Dawson-Bryant deprive students of opportunities in fine arts and physical education at an early age, directly impacting their interest and abilities. Students at the Monitor and Intermediate buildings are eligible to receive free breakfasts, but are not being provided with those. Elementary, middle school, and high school students are deprived of science labs and science opportunities. Students' exposure to technology has been inadequate, and students are disadvantaged by the lack of integration of technology into the curriculum. (Washburn Tr. 2372-73) 27. In May 1993, the Dawson-Bryant Local Board of Education was successful in passing a bond issue that will allow the district to participate in the Building Assistance Program. The campaign and voter turn out indicate strong support and substantial financial commitment from the community. (Washburn Tr. 2365-66) 28. Under the building assistance project, the new facilities are to be completed in the fall of 1995. The plans include closing the Monitor and Intermediate buildings, making renovations and additions to the Deering Elementary building so that it can become a centralized K-5 building for the district, modifications and renovations to the present high school to become the middle school, and a new high school. (Washburn Tr. 2367) The district is working within a budget, and after completion of the facilities project, facility problems will remain. A parking problem at the new high school will remain because of the limited space. The middle school and high school will share library, an art room, and a band room. Intermingling of students in grades 6 through a with high school students creates concerns about proper supervision of students. (Washburn Tr. 2369-70) The parking and safety problems at Deering will increase with the addition onto the building and the additional number of students and staff members. There will be no art or music/band room at Deering Elementary. (Washburn Tr. 2370-71) 29. The total cost of the facilities project at Dawson-- Bryant is expected to be $12.5 million. (Washburn Tr. 2371) The 1990 Ohio Public School Facility Survey indicated that the needs for Dawson-Bryant totalled $14.9 million. The difference of $2.4 million represents outstanding needs of the Dawson-Bryant School District after the new facilities are completed. (Washburn Tr. 2437-38) 30. The Building Assistance Program will not provide any operating or maintenance funds to accompany those facilities. (Washburn Tr. 2373) 31. Plaintiff Dawson-Bryant Local School District does not have a cafeteria big enough to feed all of its students, 90 students are allowed to leave the school grounds for lunch. (Swartzwelder Depo. 51) 32. The high school and intermediate schools in Plaintiff Dawson-Bryant Local School District have coal-fired boilers which emit hazardous coal dust into the student classrooms. (Swartzwelder Depo. 53) 33. The coal dust at the intermediate building in the Dawson-Bryant Local School District is cleaned at the end of each day, but the classrooms are not cleaned in the morning when the students come in. Coal dust often covers students' desks. (J. Blankenship Depo. 17) 34. At Dawson-Bryant High School, Chris Jackson was disturbed by the noise from classrooms being close together, students from the elementary building in the high school, and noise from the heaters. (Jackson Depo. 38) He found the buildings at Beachwood to be in much better shape, with the environment of the whole school very open, noise free, very comfortable, with a comfortable room temperature, large rooms, small class sizes, and teachers that seemed far superior. He viewed a swimming pool, two gymnasiums, an indoor track, a huge cafeteria, and a very nice auditorium. (Jackson Depo. 36) 35. There is no hot water in the restroom facilities throughout the Dawson-Bryant High School. The teacher's lounge has only cold water, and the only rooms in the building that have hot water are the home economics room and the cafeteria, other than the locker facilities where separate water heaters are available (Semanco Depo. 13-14) LIMA 36. Plaintiff Lima City School District is unable to engage in preventative maintenance of its school facilities, instead, repairing roofs and windows on an emergency basis. (Eaton Depo. 31-32) 37. Plaintiff Lima City School District cannot raise enough money through the passage of a permanent improvement levy to meet its facilities needs. (Eaton Depo. 31-32) 38. Plaintiffs' Exhibit 285 is the architects' reports of the Lima City School District facilities done in connection with the 1990 Facilities Survey conducted by the Ohio Department of Education. (Buroker Tr. 2966) 39. The Lima City School District operates 16 buildings that house pupils, as well as an educational center that houses the central office staff. The District has a stadium that also functions as a maintenance facility, as well as a separate football facility that accommodates baseball, softball practice, football, and track, together with locker rooms and facilities for selling concessions. The District's school buildings consist of eleven elementary buildings, three middle schools, a high school and an alternative high school. (Buroker Tr. 2875) 40. Three of the elementary school buildings in the District were built in the 1920s. Those buildings have wood floors and high ceilings with asbestos in the ceilings and in the piping. The plumbing in those buildings is deteriorating. In addition, the electrical service is in need of expansion. Exterior walls have also experienced deterioration. In order to update the electrical service, it would be necessary to run additional wiring through the walls and ceilings which would penetrate asbestos resulting in substantial effort and expense to prevent friable asbestos fibers from escaping into the air. (Buroker Tr. 2877-78) 41. Only one of the eleven elementary schools in the Lima City School District is handicapped accessible. None of the elementary schools is air conditioned. Only one has a separate room available for instruction in art or music. (Buroker Tr. 2879) 42. The facilities' needs identified in Stipulation Exhibit 47, with respect to the Lima City School District, are substantially in existence today. Some energy-related improvements have been accomplished through a program permitting the school district to borrow funds for energy-related improvements. In the course of those improvements, the district converted six facilities that were still heating with coal furnaces to natural gas. (Buroker Tr. 2881) 43. The district has no plans to air condition any of the facilities because they lack funds to pay the utility bills associated with operating the air conditioners. (Buroker Tr. 2884) 44. South Middle School in the Lima City School District was built in 1917 and added in the 1920s with several additions subsequent to that. The building has a major electrical problem because the electrical system was designed in the 1920s. Maintenance people have to wear rubber gloves and rubber vests to approach the electrical panel. In the past fall, a portion of the brick exterior of the South Middle School collapsed onto the sidewalk in front of the building. The sidewalk is used extensively by students coming to and from school. The building has three towers of similar design to the one that collapsed, all of which are presently in need of repair. South Middle School consist of three floors and a basement, none of which is accessible to orthopedically-handicapped individuals. The plumbing in the South Middle School needs to be totally replaced. (Buroker Tr. 2885) 45. Lima City School District has three middle schools in total. Two of them were built in the late 1960s. One of the middle schools has an elevator, but none of the buildings meet current ADA requirements for accessibility to handicapped pupils. (Buroker Tr. 2886) 46. The Lima Senior High School consists of a building of approximately 255,000 square feet, housing about 1,400 pupils. The high school was built in the mid-1950s and every room has asbestos in the ceilings. The district has had several problems because any structure work in the high school will disturb asbestos resulting in a need for substantial costs connected with monitoring and encapsulation. In one example, the shop teacher removed a dust collection system resulting in having disturbed friable asbestos resulting in a cost of $15,000 to make the room safe for pupils. (Buroker Tr. 2888) 47. Construction work requires that the area be sealed off, the workers work in environmentally-protected suits, and the area be cleansed of friable asbestos before it can be used again by pupils. (Buroker Tr. 2888) 48. The Lima City School District also has asbestos in the gymnasiums in the elementary schools. Certain activities have to be limited because of the potential for releasing friable asbestos by having balls strike asbestos-laden ceilings. (Buroker Tr. 2889) 49. The district has a number of roofs that need to be replaced which have not yet been replaced. When the roof leaks onto the asbestos, either the ceiling below it falls and has to be replaced or it dries making the asbestos friable. The district has in place a monitoring plan as required by federal law. It incurs costs between $40,000 and $45,000 a year to contain asbestos in the buildings. (Buroker Tr. 2889-90) 50. The district presently operates eleven elementary schools and needs only seven elementary schools. It is unable to reorganize the elementary programs because to do so would require new facilities. The district lacks funds to build, equip, and supply new facilities. (Buroker Tr. 2892-96) NORTHERN LOCAL 51. School buildings at Plaintiff Northern Local include a middle school/high school complex consisting of a middle school built in 1970 and a high school built in 1960. There is an elementary school building at Somerset, two elementary school buildings at Glenford, and an elementary school building at Thornville. There also is a bus garage located behind Somerset Elementary School. (Johnson Tr. 1387-88) 52. Plaintiff Northern Local School District educates some students in nine modular units, which is the equivalent of 18 classrooms. Three modulars are at the junior/senior high complex, housing 6th grade classes. At Thornville Elementary, there are four modular units, with eight classrooms. At Glenford Elementary, there are two units, with four classrooms. Class sizes in modular units run anywhere from 25 to 30 students. (Johnson Tr. 1390) 53. Superintendent Johnson described the facilities problems encountered at the Somerset Elementary School in Plaintiff Northern Local School District. In July or early August of 1992, the bricks were bulging near the parapet at the north end of the building. Representatives from the State Department of Education inspected the building and suggested that they have an engineer come out and look at the building, and suggested Paul J. Ford Company of Columbus. That company examined the building and recommended the district close the school as soon as the weather started freezing and thawing. (Johnson Tr. 1398-99) 54. The Department of Education inspected the Somerset Elementary building in the Plaintiff Northern Local Schools and observed that the walls were bowed out and represented a hazard to the pupils using the building. The Department "strongly suggested" that the building be closed. No state funds were available to assist the Northern Local Schools. (Van Keuren Depo. 135) 55. After Mr. Johnson became aware of the problems with the Somerset building, and after he was advised by engineers to remove the students from the building, he contacted Bob Franklin, Jack Hunter, James Van Keuren, Charles Brown of the Ohio Department of Education and Senator Steve Williams and Representative Paul Mechling to determine if there were any funds available for districts such as Northern Local with emergency problems. No money was available for such an emergency situation. (Johnson Tr. 1406-08) 56. In September of 1992, Robert Franklin visited Northern Local School District's Somerset Elementary building. This was after the Northern Local Superintendent, Steve Johnson, asked Mr. Franklin to visit the site. After inspecting the building, Mr. Franklin determined that the building was not safe and recommended that the school district remove all children and teachers from the school. Mr. Franklin testified that he was fearful that the mere passage of school buses may cause the building to vibrate and force the building walls to collapse. (Franklin Depo. 129-32) 57. Before Mr. Johnson became Superintendent of Plaintiff Northern Local School District, there were structural problems at the Somerset building, requiring steel beams to be put into the building in order to make sure it was structurally sound. Other problems with the Somerset building continued until the building was closed. The windows in the Somerset building leaked air, and sand particles from the brick would blow through the windows and over the students' desks. The roofs leaked consistently in the Somerset building. The district covered the stage with wall board to create a library in the Somerset building. (Johnson Tr. 1400-02) 58. Before the Somerset building was closed and students were moved from that building, the district erected scaffolding around the entire building and portable canopies over each doorway to protect students from falling bricks. (Johnson Tr. 1402) 59. In October of 1992, the Board of Education of Plaintiff Northern Local School District decided to close the Somerset School building and move the students to another location. For the remainder of that school year, the Plaintiff Northern Local School District used five classrooms at the Junction City School and four classrooms at the New Lexington Elementary School, both in the New Lexington City School District. Kindergarten for the students of the former Somerset building was held in a church in Somerset. Two sixth grade classes from the former Somerset building were moved to the Northern Local junior/senior high school complex. (Johnson Tr. 1404) 60. The closing of the Somerset School and the moving of the students to other school buildings created significant costs for Plaintiff Northern Local School District. Students had to be bussed both to Junction City and to New Lexington, which also caused students to miss part of their school day. The district was forced to pay additional mileage on the busses and to pay bus drivers additional hourly wages. In addition, Northern Local School District was forced to pay for the extra custodian and cooks which the New Lexington City School District was forced to add to accommodate the additional Northern Local students. (Johnson Tr. 1485) 61. The total cost to Plaintiff Northern Local School District associated with the closing of the Somerset building was approximately $120,000. (Johnson Tr. 1408) 62. As a result of the closing of the Somerset building, classes throughout Plaintiff Northern Local School District were rearranged. Following the temporary arrangements made with New Lexington City School District, all sixth graders in the district were taken to the junior/senior high school complex. Fourth and fifth grade Somerset students were sent to Thornville Elementary. Fourth and fifth grade special education classes were taken from Glenford Elementary and moved to Thornville Elementary. Kindergarten through third graders from the Somerset building were moved to Glenford Elementary. That arrangement continues to the present. (Johnson Tr. 1409-10) 63. The fifth and sixth grade students that were transferred from the Somerset building to the high school/junior high school complex are educated in modular units. The cost of those units is $13,000 a month for a four-year lease. (Johnson Tr. 1410) 64. Students educated in modular classrooms at Sheridan High School in Plaintiff Northern Local School District are isolated from other students and other faculty members, and there are no restroom facilities available in the modular units. (Miller Tr. 1638; Johnson Tr. 25) 65. The addition of the modular classroom units in Plaintiff Northern Local School District has created overcrowding in the junior high school cafeteria. (Miller Tr. 1638; Johnson Tr. 1425) 66. The bus garage in Plaintiff Northern Local School District is an old vocational agricultural building. It can accommodate only one bus at a time, and it has no lift area or any place for fluid drainage. Plaintiff Northern Local School District has thirty buses in its bus fleet. (Johnson Tr. 1411) 67. Plaintiff Northern Local School District is 30th in line to get on the list of school districts approved to receive funds under the building assistance program. (Johnson Tr. 1411-12; Stip. Exh. 52) 68. Plaintiff Northern Local School District did not apply for state school building assistance funds in 1989 because Superintendent Johnson called the Ohio Department of Education and was told at that time that the district did not qualify due to the valuation of the property in the district and the income level of the district. (Johnson Tr. 1517) 69. The buildings in Plaintiff Northern Local School District were constructed of brick using limestone mortar instead of Portland cement. As a result, the mortar in those buildings is deteriorating, and the district has had to repair the mortar in all the buildings except for the Somerset building. (Hill Depo. 16-18) 70. The Glenford Elementary School in Plaintiff Northern Local School District actually consists of two buildings which were constructed in 1917 and 1955. Both the windows and the roofs in each of these buildings leak on a continual basis. The ceilings in these buildings are high, the lighting is poor and there is no storage space in the older of the two buildings. The restroom facilities at the Glenford buildings are deplorable; if the plumbing fixtures stick, the water will continue to run until the water well is dry. During the 1989-90 school year, the furnace in the Glenford gymnasium blew up and the district had to purchase a new furnace for $18,000. (Johnson Tr. 1414-16) 71. At Glenford Elementary, State Route 204 runs between two buildings that house students. State Route 204 is a heavily travelled highway, particularly by sand trucks The trucks come down a hill on the highway toward the location where students cross the state route between the two buildings. Although school administrators have requested stop lights to be placed at the student crossing, there is no stop light at the crossing. (Papritan Tr. 1919-20) Kindergarten, 1st, and 2nd graders must cross State Route 204 five times a day for lunch, two recesses, and to load buses in the evening. These students must cross the highway to access appropriate playground equipment and to go to the cafeteria located in the 1955 building. Students in the 1930 building must cross the street to be picked up by busses and parents. Older students in the modular units located next to the 1955 building cross State Route 204 once or twice a day to go to the library and to music. Reconstruction of the parking lot and driveway around the 1930 building is necessary to make it accessible to busses and other transportation and to reduce the number of times students are crossing the highway. (Papritan Tr. 193032) 72. When it is rainy, students at Glenford Elementary play on the road behind the 1955 building, although that road is open to traffic. (Papritan Tr. 1933) For safety of students, the playground needs pea gravel or mulch. (Papritan Tr. 1933) 73. The bus loading and unloading at the Glenford Elementary Buildings is unsafe. In the mornings, busses are stopping traffic on State Route 204 because the circle driveway behind the older building is in disrepair and cannot be used by buses. (Papritan Tr. 1928-29) 74. In the 1930 Glenford Elementary building, dust is all over students' desks, because the district could not afford a furnace filter. Wind blows in around the windows, particularly on the 3rd floor in that building and snow comes ill around some of the windows as well. The restrooms smell badly, look terrible, and are in need of replumbing. Because of limited class space, kindergarten students must go down three flights of stairs to the bathroom. (Papritan Tr. 1934-35) 75. In the 1955 Glenford Elementary building, a girls' restroom with two stalls and a boys' restroom with one stall and two urinals serves about 200 students. The restroom facilities are inadequate for that number of children. The roof in the 1950 building leaks when it is not raining. Although there is a layer of roof on top that is guaranteed, there is a roof underneath that is not guaranteed. Water gets trapped between the two layers of roof and when it gets warm, black, moldy water with pieces of ceiling fall down. (Papritan Tr. 1935-36) 76. The auditorium of the Glenford buildings is an old vocational agricultural building located behind the older of the two Glenford school buildings. The high school drama club, at its own expense, renovated this Vo Ag building for use as an auditorium. The roof of the auditorium building leaks constantly, ruining equipment for plays. The district also has a problem with rats getting into the building. Because of the rats and the safety problems with the building, Plaintiff Northern Local School District no longer uses that building as an auditorium. (Johnson Tr. 1417-18) 77. The sewage system at the Glenford Elementary School buildings is outdated and often becomes plugged up and backs into an adjacent creek. (Johnson Tr. 1419) 78. In November of 1992, the Ohio EPA found a high level of arsenic in the water wells which service the Glenford Elementary School buildings. The school district was forced to shut down the water supply to those buildings, and students were not permitted to wash their hands with this water or use the water to wash cafeteria trays. As a result, the district was forced to bring bottled water into the Glenford Elementary School on a daily basis. The district had to buy towelettes for students to wash their hands and cups for students to use for drinking. To solve the arsenic problem, Plaintiff Northern Local School District drilled a shallow well and installed a holding tank to insure that a proper volume of water would be available for the school buildings. The total cost to Plaintiff Northern Local School District to address the problem of arsenic in the drinking water at Glenford Elementary was approximately $20,000. (Johnson Tr. 1419-25) 79. When the problem of arsenic in the water at Glenford Elementary School became apparent, Superintendent Johnson contacted Bob Franklin, Jack Hunter and Jim Van Keuren, Charles Brown and State Senator Steve Williams to attempt to obtain financial assistance. No financial assistance was available through the Ohio Department of Education, and the $20,000 cost for remedying the arsenic problem was paid for by Plaintiff Northern Local School District out of school district general funds. (Johnston Tr. 1423-1424) 80. Superintendent Johnson asked Robert Franklin if monies were available from the State to help with the arsenic situation, but was told no funds were available from the State of Ohio. Mr. Franklin testified that had there been an Emergency School Repair Fund in existence, then monies would have been available to help Northern Local School District with its building and water problems. (Franklin Depo. 134-37) 81. The Thornville Elementary School in Plaintiff Northern Local School District was constructed in 1908 with an addition added in 1928. As with the other buildings in the district, both the windows and the roof leak continually. The lighting is poor throughout the building, and the wooden floors are warped. The cafeteria in the Thornville Elementary School is very small, and students must wait in the hall with their trays until other students using the cafeteria tables are done eating. At one point, particle board was placed over areas of peeling plaster; however, when that particle board was removed in the summer of 1993, it was discovered that there were maggot and ant infestations behind the particle board. (Johnson Tr. 1425-27) 82. Plaintiff Northern Local School District used to employ a maintenance supervisor, who performed plumbing, electrical and carpentry work throughout the district. After that individual retired, the district could not afford to replace him. Currently, Plaintiff Northern Local School District does not have a maintenance supervisor. (Johnson Tr. 1431; Hill Depo. 15) 83. The high school/junior high school complex in Plaintiff Northern Local School District experiences the same roof leakage problems as the other buildings in the district. The gym floor at the complex is beyond repair and a new floor is badly needed at a cost of $75,000 to the district. The rooftop heating units over the junior high school area need to be replaced at a cost of $70,000 to the school district. The high school weight training room is a former storage area in the basement which is equipped with weights purchased by the students through fund-raising activities. The athletic locker facilities are deplorable, the showers do not work. The cafeteria and kitchen in the high school are too small for the number of students utilizing the building: the cafeteria for the junior high area is in the gymnasium. (Johnson Tr. 1432-36) 84. The sewage system at Sheridan High School is outdated, and when the system plugs up, raw sewage flows onto the outfield of the baseball field. It would cost the district over $100,000 to repair the sewage problem at Sheridan High School. (Johnson Tr. 1438-39) 85. At Sheridan High School, the home economics room was divided into three classrooms for a severe behavior handicapped class and intervention labs for the junior high and high school students to prepare for ninth- grade proficiency tests. The renovations to create these rooms cost the school district $20,000, and those funds were taken from the school district's general fund. (Johnson Tr. 1437-38) 86. Plaintiff Northern Local School District has recently been informed by an engineer employed to study the school district's facilities' problems that if the Thornville and Glenford buildings are not renovated soon, they will have to be closed. (Johnson Tr. 1443) 87. In order to construct a building complex for students in grades K through 8, Plaintiff Northern Local School District would have to generate $14 to $15 million. However, the district is by law restricted to generating 9 percent of their assessed valuation, which, as of November 1993, was approximately $90 million. Accordingly, Plaintiff Northern Local School District can only raise a little over $8 million locally to address its facility needs and therefore accepted a plan which no school board member, administrator nor the architect felt was the best solution for the district in order to fit inside the State Law for indebtedness by a school district. (Johnston Tr. P. 1444: Miller Tr. 1651) 88. The photographs contained in Pl. Exh. 113 accurately depict the condition of the Thornville Elementary building. The photographs contained in Pl. Exh. 114 accurately depict the condition of the newer Glenford Elementary building. The photographs contained in Pl. Exh. 115 accurately depict the condition of the older Glenford Elementary building. The photographs contained in Pl. Exh. 116 accurately depict the condition of the Somerset building. (Pl. Exh. 113; Pl. Exh. 114; Pl. Exh. 115; Pl. Exh. 116; Johnson Tr. 1448- 50) 89. Because of the debt limitations of Plaintiff Northern Local School District, the district decided that in order to remedy its facilities' problems, the best course of action would be to renovate the Somerset building, renovate the Glenford and Thornville buildings, renovate the junior/senior high complex and add additional classroom space and science facilities and purchase new equipment. In order to achieve these facilities' goals, in May and August of 1993, the district put a $6.5 million bond issue before the voters. Both issues failed. Additionally, on November 2, 1993, the district put a $6.3 million bond issue before the voters, and it failed. The November bond issue placed before the voters was for 5.26 mills, which would not have raised enough money to address all of Plaintiff Northern Local School District's Facilities needs. (Johnson Tr. 1444; Johnson Tr. 1453- 54) 90. The facilities in Plaintiff Northern Local School District have not changed in the last 20 years. (Miller Tr. 1619) 91. Plaintiff Northern Local School District received $683,000 in energy assistance funds under H.B. 264. This money was not given to the school district by the State of Ohio but rather it was loaned to the district. The district pays back that money to the State of Ohio at a rate of $105,000 per year. (Johnson Tr. 1515) SOUTHERN LOCAL 92. Dr. Phillis participated in the application of Plaintiff Southern Local School District in Perry County for Classroom Facilities Act assistance in 1980/1981. In that context, he visited the buildings at New Straitsville, Moxahala, Corning and the high school. At that time, he observed inferior heating and ventilation with extremes of temperature in the summer and winter, as well as an electrical system that was not satisfactory and buildings in a very inferior condition. (Phillis Tr. 1681) 93. In 1993, the Southern Local School District was successful in obtaining Classroom Facilities Act funds together with passage of the necessary tax levy and bond issue in order to provide new school facilities. The need for those facilities had been continuous for a period of at least 12 years between 1980 and 1993. (Phillis Tr. 1682) 94. The Southern Local School District had 821 improperly housed pupils identified in connection with its Classroom Facilities Act assistance application. Only 189 of the pupils in the District were found to be properly housed. (van Keuren Depo. Exh. 6) 95. When Superintendent Spangler was employed in August 1991, elementary students were house at New Straitsville Elementary, Corning Elementary, and Moxahala Elementary; junior high students were housed at Miller Junior High at Shawnee, and high school students were housed at Miller High School. The New Straitsville and Shawnee buildings were built around 1915, with Shawnee having some additions after that. Moxahala and Corning were both built in the 1920s. (Spangler Tr. 447-48) 96. As a result of lack of resources for comprehensive maintenance and upkeep, all of the buildings, other than the high school, were in very poor condition in 1991 when Ms. Spangler became Superintendent. The heating, electricity, ventilation, plumbing, and sewage systems in the elementary and junior high buildings needed comprehensive repair. The sewage system at New Straitsville Elementary would flood over State Route 93 on occasion. Incidents such as the temperature in Moxahala's gym being only 20 degrees were not uncommon. The Corning, New Straitsville, and junior high buildings did not have a working intercom, and the high school building intercom worked only one-way. The bell systems at the elementary and middle schools would go down periodically, and cable TV at those buildings was nonexistent. Tornado drills at those buildings required the principal to walk through the buildings with a little compression can that blew a horn. Asbestos was a primary concern in the elementary and junior high buildings. At Shawnee, the major part of the building was constructed with asbestos in the lower layer of the plaster. Because plaster was falling, some mornings the custodian and principal at the Shawnee building would go into rooms and knock plaster off the ceilings so that big chips would not fall on students during the day. Students and teachers had plaster in their hair. During a Christmas program at the building, little flakes of plaster fell like snow. After the Shawnee building was closed in the spring of 1993, Superintendent Spangler visited the building in the fall and found chunks of plaster all over the halls; because the floors were not being swept on a regular basis as when the building was in use, the plaster was more evident. At Shawnee, the roof leaked, the lighting was poor, the heating was inconsistent, and there was no hot water in the bathrooms. (Spangler Tr. 448-52; Altier Tr. 1292-93; Towner Tr. 822) 97. Louis Altier, President of the Southern Local Board of Education, testified that he has farm animals that are housed better than students were housed in the Shawnee building. Whereas his animals were dry and warm, that could not be said about the students in the Shawnee building. (Altier Tr. 1291) 98. The district did not have the financial resources to completely replace electrical systems and plumbing systems, to remove asbestos, and to perform the comprehensive maintenance that was necessary to keep the buildings in a safe condition. (Spangler Tr. 452) 99. Because of the elementary and middle school buildings' design and lack of maintenance, minor accidents occurred regularly, including falls, splinters, cooks being burned because of close quarters, and students being stung by bees and wasps in the building. (Spangler Tr. 452-53) 100. Chris Thompson attended the New Straitsville Elementary for kindergarten, for the two weeks he spent in 2nd grade before being advanced a grade, and for 3rd grade (1984-85 and 1986-87). The building gave Christopher "a dirty feeling." There was plaster falling off the walls and ceilings and cockroaches had been seen crawling on the floor in the restrooms. Chris avoided using the restrooms at all while at school; he waited the entire school day to use the bathroom at home. The gymnasium floor was warped and it was so small that Chris found it difficult to play some sports because students would run into the walls. There was no space outside of the out-of-bounds lines because the lines were so near the walls. The library was very small with inadequate book supplies and with outdated books. Following a storm, the roof leaked and a large piece of the ceiling fell onto the floor and the library was closed for about two to three weeks. Students had no access to the library during that time. (Thompson Tr. 1307-09) This was a violation of the 1983 minimum standards, which requires that libraries be available for student use during school hours. O.A.C. 3301-35-03(B)(2)(b) 101. In the 4th through 6th grades, Chris Thompson attended the Corning Elementary building (1987-88 to 1989-90). The building was very dirty, the bathrooms had cockroaches and other creatures crawling on the floors, possibly silverfish. A leaking roof was a real problem. In math class, water dripped like a waterfall from the ceiling into a bucket after rains. Sometimes, the students had to ask the teacher to be moved because the water was splashing on them. After a hard rain the night before, the constant drip into the bucket was very annoying. The library at Corning was very small with an inadequate supply of books and with outdated books. The science room was next to the furnace room, which made the science room very noisy, and it was hard for the students to concentrate or to hear the teacher talk Plaster was falling off the walls at the Corning building. (Thompson Tr. 1310-11) 102. Chris Thompson attended the Shawnee building for the 1st grade (1985-86) and for the 7th and 8th grades (1990-91 to 1991-92). In the six years between his 1st grade and the 7th grade attendance, the building really had not changed much. The floors at Shawnee were warped, plaster was falling off the walls, and there were large holes in the walls in the front part of the building. The art room was very small and dirty, had plaster falling off the walls and the ceiling, and it was located next to the furnace room and next to the gym. The art room was very noisy and did not have adequate space to work. (Thompson Tr. 1311-12) 103. When Chris Thompson was at Shawnee, the gymnasium had a leaking roof, and at one time part of the gym was flooded due to the leakage. When a ball hit the ceiling while students were playing kickball or volleyball, part of the ceiling came down. The locker rooms below the stage area and adjacent to the gym had almost no water pressure, stunk, and were unfit for student use. Students changed clothes in two storage rooms next to the stage, but had no shower facilities available. (Thompson Tr. 1313-14) 104. When Chris Thompson began to attend high school, the high school building did not have heat due to construction and renovation of the heating system in the fall of 1992 until the end of November or the beginning of December. Students had to wear coats and gloves to classes, and were subjected to fumes from large kerosene heaters when the building got very cold. (Thompson Tr. 1324-25) 105. Southern Local's high school was constructed under the State Building Assistance Fund over 30 years ago. (Spangler Tr. 447) In 1981, however, Southern Local voters did not approve the levy necessary to qualify for the State Building Assistance Fund. (Spangler Tr. 453) The State had identified improperly-housed pupils at Southern Local before the levy attempt in 1981. As of September of 1989, there were 821 improperly-housed pupils in Southern Local. All of the pupils who attended the elementary and middle school buildings at Southern Local remained improperly housed until the fall of 1993. (Pl. Exh. 378) 106. Through the State Building Assistance Fund, the residents of the district passed a levy in 1990 equal to 7 percent of the district's assessed valuation (6.45 mills), and the State Building Assistance Fund provided the remainder of the funds through a loan to construct a new elementary and middle school facility. The total project was $9.6 million with $1.7 million provided by local funds and $7.9 million provided by the state. (Spangler Tr. 444-45, 456) 107. State Building Assistance Projects are closely monitored by the State. The district submits and develops designs that must be approved by the State, and the State is involved and oversees the bidding of the project. Every purchase order and check that is written on the project is co-signed by the State Superintendent of Public Instruction. After completion, the State owns the facility until the bonds are paid off. (Spangler Tr. 446-47) 108. In the fall of 1993, Mill Creek Elementary, serving grades K through 4 and Miller Middle School, serving grades 5 through 8, opened after construction was completed. The new building is next to the existing Miller High School. (Spangler Tr. 454) 109. The new facilities have had a positive effect on students, most of whom are extremely proud of the facility. Administrators believe that students are achieving more. (Spangler Tr. 456-57) 110. Plans for the new facility had to be approved by the State, and were restricted by a budget requiring compromises in square footage, so that the superintendent's office is still across the street from the school buildings in a trailer, and many shared facilities were required. Elementary and middle school children share a cafetorium and managing that sharing particularly for lunch times is a problem. The gymnasium is in middle school size and cannot be used for high school play or regulation tournaments. Two physical education classes share the gymnasium at the same time with a divider, and traffic and noise problems exist. (Spangler Tr. 454-55) 111. In 1991, architects had studied Miller High School and estimated that the cost to bring the high school up to code and to build a new facility for elementary and middle school would be $13,000,000. The total project cost completed in 1993 at Southern Local was $9.6 million. Unmet facility needs remain at Southern Local. (Spangler Tr. 455-56, 458) 112. Unmet needs at the elementary and middle school level include a classroom shortage, if programs or numbers of students increase. Particularly, the need for an additional special education classroom may be necessary next year, because the percentage of handicapped students is again on the increase. Also a low-income housing project to be constructed in Shawnee may result in growth in student enrollment. At this time, only one room that is currently being used by the DPPF program possibly could be converted to a classroom, but no other classrooms are available. (Spangler Tr. 45-59) 113. Although the district was able to purchase some furnishings with the new building project, those furnishings were not sufficient to provide for a library reading circle or for current equipment for the science labs. The K-6 art program has a brand new kiln room, but it does not have adequate equipment to use the room. The new gymnasium needs many mats and equipment, such as balance beams, parallel bars, and other items, for the physical education program to function. There is no budget and no money available to provide these items. (Spangler Tr. 460-61) 114. The Classroom Facility Act provides no monies for maintenance or repair of facilities. Southern Local has budgeted approximately $11,000 per year for maintenance and repair of buildings, which is about one-tenth of what is needed for annual maintenance. (Spangler Tr. 461-63) 115. Miller High School was built about 30 years ago with Building Assistance Funds, and the district has not been able to provide much maintenance. (Spangler Tr. 463-64) Some repairs at the high school were made with State Building Assistance Funds because the facility was shared, such as the heating and ventilating system upgraded. Through an Energy Conservation Note (H.B. 264 Project), the Miller High School roof was repaired. (Spangler Tr. 456) Yet, the following needs remain at Miller High School: (1) The electrical and lighting systems need work, including the replacement of fluorescent tubes and ballasts. The district was recently cited by the Health Inspector for failure to replace lights. The bell system is worn and the intercom only works one way. (Spangler Tr. 464-65) (2) Other citations by the Health Inspection included the safety features in the chemistry lab, including the lack of a current eye-wash station. The custodial area and the plumbing there was cited as a safety violation. Another citation was found on some of the audio visual equipment and the way it was stored and kept, because it was not bolted down or strapped down properly. (Spangler Tr. 464-65) (3) The internal air exchange system needs replaced, but was not replaced through the new building project. (Spangler Tr. 465) (4) The plumbing and fixtures at the high school need replaced, and there were problems in the rest rooms and with water fountains. The water fountains were also cited on the recent Health Inspection. (Spangler Tr. 465) (5) The foundation of the high school building needs water-proofing, but the cost of the sealing paint was prohibitive. (Spangler Tr. 466) (6) Concrete work, including the front stairs to the high school that are chipped and cracked with broken railing, need work. Curbing also needs concrete work. (Spangler Tr. 466) The doors of the high school need repaired or replaced to secure the exit ways. (Spangler Tr. 466) (7) Settling of the foundation needs addressed. (Spangler Tr. 467) (8) The gym floor needs to be sealed. (Spangler Tr. 467) (9) All the classroom furniture is more than 20 years old, has rough edges, and it does not meet current student needs. (Spangler Tr. 467) (10) The science lab has water at only one laboratory station, and many gas outlets do not work, so it is impossible for the students to do experiments. The science teacher lacks basic equipment for experimentation in science, such as current scales and chemicals. (Spangler Tr. 467-68) (11) The science area needs basic safety equipment, including a proper eye-wash station. The emergency shower for the science lab is a rubber hose hooked onto a water fixture. (Spangler Tr. 467-68) (12) The industrial arts program should be an industrial technology program, but remains a 30 year old wood shop. The equipment becomes increasingly in disrepair as the years go by, and there are many safety needs. There is no emergency or first-aid equipment there. (Spangler Tr. 468) (13) The high school locker rooms have many needs. Many of the lockers do not work. There is no place for storage of football equipment except in some of the lockers. The showers do not work and the hot water works inconsistently to the locker rooms. There is no trainer's station, no whirlpool, no ice machine, and no weight room. A very basic set of weight equipment can be found in the boys' locker room, but girls have no access to the weights. There are no facilities for a trainer, no facilities for officials, and nothing other than an office for coaches such as a shower, basic first-aid, or storage. (Spangler Tr. 467-70) (14) Weight conditioning is of primary importance in athletics, because it is necessary to protect players from injury. The athletes at Miller High School are not being afforded an adequate, safe facility on which to condition and train. Weight conditioning for both boys and girls occurs in the boys' locker room, which are cramped quarters, where the floor is often wet, thereby presenting a dangerous situation. (Winnenberg Tr. 805-07) (15) Although the gymnasium floor is new (because the contractors replaced it after flooding the gym floor), the bleachers are in need of replacement, and the stage curtain at one end of the gym cannot be closed because it is ripped down the middle. The stage area is badly deteriorated and the lights function, at best, intermittently with some not functioning at all. (Spangler Tr. 470-71) (16) The athletic field has no visitors' side. It has only one section of very old bleachers on one side of the field that are in need of repair and many need replaced. The concrete work at the field needs to be upgraded or replaced. The wiring to the football lights and speaker system is very old. The concessions stand has inadequate facilities, including lack of water, although it does have electricity at most times. The track is a berm dust track, which is outdated and not typical for tracks in Ohio schools. The football field is maintained when the athletic director/principal has time to do so. (Spangler Tr. 471-72) (17) There is a separate facility outside Miller High School for the natural resources program. The building consists of a classroom area and a shop area. There is no intercom to the building, no water, and no heat to the building. The building is dark and is of free-standing metal construction. (Spangler Tr. 472-73) Students in Ohio should not be housed in a "classroom" such as this. 116. The bus garage at Southern Local is housed in a school building that was closed in the 1960s. The building has a lot of evident deterioration. The roof, plaster throughout the building, and the wood floor are all deteriorating. The lighting is very poor and the rest rooms that the bus transportation staff must use need much improvement. (Spangler Tr. 475-76) 117. The district still owns four buildings that are no longer in use. The Corning building is currently leased to a community group, and New Straitsville may be used similarly. However, the estimate to demolish the Shawnee building is $800,000, because that building is filled with asbestos. Also, the Moxahala building is a concern. The district needs to find funds to deal with their properties in a responsible manner. (Spangler Tr. 476-77) 118. Before the construction of the new school building, none of the buildings in Plaintiff Southern Local School District was fully handicapped-accessible. (Lichtenstein Depo. 64) 119. The Southern Local School District has sought volunteer work and contributions from local companies to assist them with their facility and energy needs. Mr. Altier testified that he was successful in convincing a company that was removing oil by the district's school bus garage and flaring the gas to allow the school district to use that gas in the bus garage. In the early 1980's, the school district was able to obtain the help of Hocking Technical College to drill a small well to supply gas to the high school. The school district was able to purchase transmission pipes at cost from local suppliers. Everything else was donated by local businesses or supply stores to the school to enable the school to utilize this gas. Mr. Altier testified that his company, Altier Brothers, continues to maintain and service those two wells, at no cost to the school district. (Altier Tr. 1294-95) 120. Volunteer work and contributions from Mr. Altier's company and other local businesses enabled the school district to reconstruct the football field years ago. Local individuals also helped to construct the bleachers, and local companies provided poles and transformers to light the football field. Volunteer labor and donations were also used to construct a softball field. However, the bleachers are now in need of repairing, but they cannot be repaired because the school district does not have the resources, and the local companies who contributed before are now either gone or struggling economically. (Altier Tr. 1296-97) YOUNGSTOWN 121. Many buildings in Plaintiff Youngstown City School District are in disarray with bad roofs, windows needed, doors needed, and overcrowding situations. Some students use the school parking lot for a playground, and other students use a gymnasium for a cafeteria. (Kolitsos Depo. 43) 122. Most schools in Plaintiff Youngstown City School District are not free from architectural barriers. (Kolitsos Depo. 50) 123. Both Kirkmere Elementary School and Sheridan Elementary School are significantly overcrowded. (Kolitsos Depo. 50) 124. Plaintiff Youngstown City School District has set aside no funds for building maintenance and upkeep. All building and maintenance upkeep is performed on an emergency basis. (Pincham Depo. 42) 125. The 1990 Ohio Department of Education Facilities Survey determined that Plaintiff Youngstown City School District had facility needs in the amount of approximately $67 million. (Hiscox Depo. vol 1, p. 92; Hiscox Depo Exh. 8) 126. When Plaintiff Youngstown City School District passed an operating levy in 1989, the Board intended to set aside a million dollars a year from that operating levy for capital improvements, but the district has been unable to do so due to increased operating expenses. The district had to stop the addition to the Cleveland Elementary School in the middle of the project. The only capital improvements since the 1989 levy have been window replacements, an addition to Sheridan Elementary, small additions to Volney and Kirkmere Elementary schools. All capital improvements have been put on hold. (Hiscox Depo. vol 1, p. 94-96) 127. In 1978, an addition consisting of a multi-purpose cafeteria, auditorium and gymnasium was constructed on the Bennett Elementary School in Plaintiff Youngstown City School District. Even with that addition, there are space constraints at Bennett Elementary School. There are kindergarten and first grade classes of up to 37 students. The library space at Bennett Elementary is insufficient to handle all of the students because the district has taken some of the library space and tried to introduce a computer intervention lab, which is not yet fully operable. The computer intervention lab at Bennett Elementary is available to grades K through six, and it is for students who have performed on their achievement tests. The building has ten computers for intervention classes of twenty to twenty-two students. There are similar intervention labs in only half of the twenty elementary schools in the Plaintiff Youngstown City School District due to lack of available space and lack of funds for the equipment. (Hiscox Depo. vol 1, p. 102-105; Hiscox Depo. Exh. 8) 128. Bunn Elementary School houses the Youngstown City School District's multi-handicapped, orthopedically handicapped, hearing-impaired and visual-impaired units. There is also a small general education population at Bunn Elementary. Bunn Elementary is totally handicapped accessible. (Hiscox Depo. vol 1, p. 106-109; Hiscox Depo. Exh. 8) 129. Cleveland Elementary School uses a portable classroom unit to address excess student needs. The scheduled addition to Cleveland Elementary School had to be interrupted due to lack of funds, and is not yet complete. The cafeteria at Cleveland Elementary does not meet fire code because it only has one entrance and exit through the same doorway. The district has not considered closing Cleveland Elementary because it is located in a heavily populated area of the district. There are no special education units at Cleveland Elementary, and the regular education classes are overcrowded at several grade levels. According to the 1990 Facilities Survey, Cleveland Elementary is the building that has the second greatest needs in Plaintiff Youngstown City School District. (Hiscox Depo. vol 1, p. 109-114; Hiscox Depo. Exh. 8) 130. In the Haddow Elementary School, there is asbestos on the floor of the boiler room which needs to be removed. (Hiscox Depo. vol 1, p. 115; Hiscox Depo. Exh. 8) 131. Harding Elementary School was part of Youngstown's five-year plan for addition and renovation, but that project has been interrupted due to lack of funds. There are two portable classroom units at Harding Elementary which have four classrooms and no restrooms. The building has split lunches and split classes in order to help alleviate the overcrowding situation. The Harding building is in a neighborhood where there is a security problem, which creates problems for the portable units because there are no phones in those units and there are no security guards for those units. The students in the portable units must leave those units to use the restroom in the main building. (Hiscox Depo. vol 1, p. 116-118; Hiscox Depo. Exh. 8) 132. The Harrison Elementary School is an inner city school in an inner city housing project area. Because the population of that area has been decreasing over the past years, and the boundaries have not changed, the population of students is small and there is a low student to teacher ratio. The combination of this low student to teacher ratio and a dedicated principal has resulted in high achievement levels for the students at Harrison Elementary. (Hiscox Depo. vol 1, p. 119-120; Hiscox Depo. Exh. 8; Marino Tr. 3246-47) 133. The Harrison Elementary School has a federally funded kindergarten extension program for at-risk students, in which students attend kindergarten all-day, every-day. (Hiscox Depo. vol l, p. 121; Hiscox Depo. Exh. 8) 134. Hillman and Jackson Elementary Schools are in bad neighborhoods, and the buildings have had security problems. The buildings have had equipment stolen and had physical damage done. (Hiscox Depo. vol l, p. 122- 123; Hiscox Depo. Exh. 8) 135. Jefferson Elementary School was built in 1901, and it is beginning to experience foundation cracks and significant problems with exterior doors and the heating system. There is no computer lab in Jefferson Elementary School, and the computers are placed on carts for intervention classes. (Hiscox Depo. vol l, p. 125-126; Hiscox Depo. Exh. 8) 136. The John White Elementary School building has a metal building addition that has neither heating nor air conditioning. In the summer it heats up during the day so the students can hardly bear to be in their rooms, and in the winter it stays so cold there is often frost on the interior walls. The building also houses special education and remediation students in a portable unit. The library in John White Elementary has been divided to create more classroom space, so there is not sufficient library space. There is no computer lab, computers are placed on carts for intervention classes. (Hiscox Depo. vol 1, p. 126-128; Hiscox Depo. Exh. 8) 137. Kirkmere Elementary School is operating at a full capacity of over 550 students. The increase in enrollment at Kirkmere is due to voluntary bussing on the part of the school district to bring the building into racial balance. (Hiscox Depo. vol 1, p. 130-131; Hiscox Depo. Exh. 8) 138. The Lincoln Elementary School has some grades which are overcrowded, computers on carts, and insufficient recreational space. The playground doubles as a parking lot for staff and a shooting gallery for the neighborhood. (Hiscox Depo. vol 1, p. 132; Hiscox Depo. Exh. 8) 139. The Madison Elementary School has significant foundation cracks which the district needs to address. As with many other buildings in the district, computers are on carts for use in intervention classes when available. The playground at Madison is the parking lot. The building has a portable unit which is used for a federally funded intervention program. (Hiscox Depo. vol 1, p. 134-135; Hiscox Depo. Exh. 8) 140. The Martin Luther King Elementary School is beginning to have extensive roof leaks which the district has been unable to address due to lack of funds. The building is not handicapped accessible. The Martin Luther King Elementary building has security problems, and equipment has been stolen from the building. (Hiscox Depo. vol 1, p. 136-137; Hiscox Depo. Exh. 8) 141. Taft Elementary School is overcrowded, and the first grade classes in 1992-93 school year had 33, 34 and 35 students, respectively. Some parents voluntarily agreed to allow the district to transport their students to other buildings in the district just to get the first grade classes down to a 30 to 1 ratio. There is also a portable unit at Taft Elementary School. The library space at Taft Elementary is insufficient to meet the needs of the students. (Hiscox Depo. vol 1, p. 141-143; Hiscox Depo. Exh. 8) 142. West Elementary School is the largest elementary school in the Youngstown City School District, and it serves almost 1,000 students. According to the 1990 Facilities Survey, West would be the costliest building in the district to replace or repair, costing over $5.4 million. The building has divided one classroom into three rooms to service gifted students. There are some classes at West Elementary School that have over 30 students. The computers at West Elementary are on carts and are used for intervention classes. (Hiscox Depo. vol 1, p. 144-146; Hiscox Depo. Exh. 8) 143. At Adams Junior High School, there is insufficient space for extra curricular activities. The gymnasium is small, and doubles as a cafeteria/auditorium. There is no proper seating capacity and no proper stage area. There are no outdoor facilities at Adams Junior High School, and the junior high football team plays at one of the other junior high schools in the district. (Hiscox Depo. vol 1, p. 150; Hiscox Depo. Exh. 8) 144. The Hayes Junior High School building has experienced significant security problems, the lighting and ventilation in the building are both poor. (Hiscox Depo. vol 1, p. 151; Hiscox Depo. Exh. 8) 145. Volney Rogers Junior High School is the only junior high in the district with a science lab. There are no science labs at the other junior high schools because they are extremely expensive to install and the district cannot afford to use the classroom space to put in science labs. At Youngstown, the first lab courses are offered as a sophomore in high school. (Hiscox Depo. vol 1, p. 160; Hiscox Depo. Exh. 8) 146. Chaney High School is overcrowded, and the cafeteria is too small to adequately service all the students. The building does not have seating capacity in its auditorium for all of the students. (Hiscox Depo. vol 1, p. 162-163; Hiscox Depo. Exh. 8) 147. The following school buildings have been closed by the Youngstown City School District: Garfield Elementary in 1977, Thornhill following that, five elementary schools closed in 1980, a high school closed and became a junior high, a junior high closed and became a high school, and South High School closed in the spring of 1993. (Marino Tr. 3194-95) One reason that South High was closed was because of low test scores and the building was at risk of being classified as deficient by the Ohio Department of Education. (Marino Tr. 3433) Additional buildings were not closed because special education units and state and federal programs such as Chapter One needed additional space for fewer numbers of children. Also, labs were installed to assist students with passing the 9th grade proficiency test in reading and math. Another consideration in closing buildings has been the emotional stress upon students, many of whom feel that their school is like a home to them. (Marino Tr. 3194-97) H. FACILITIES IN SCHOOL DISTRICTS COMPARED TO PLAINTIFF'S 1. The Beachwood City School District consists of a primary school, housing grades 1, 2, and 3; an intermediate school, housing grades 4, 5, and 6; a middle school housing grades 7 and 8; and a high school, housing grades 9-12. The District also operates a preschool program and kindergarten program which are housed in the same building. (McMurrin Tr. 98) 2. Keri Blankenship visited Beachwood City School District where she saw differences from her school including ramps, a swimming pool, science labs, computer labs, and home economics classes. (K. Blankenship Depo. 22) There are no ramps at either Deering Elementary or the intermediate school where Keri has attended. Keri has had to have someone help her enter and exit the building, and her classes have been moved so that she would not have to climb all the stairs. (K. Blankenship Depo. 23-24) 3. The first, second, and third grades in the Beachwood City School District are housed at Bryden School. The Bryden School has recently been renovated with a new classroom for first graders with specially designed areas for various types of instructional activities within the classroom. The room includes a science center, computer center with four computers, a center for reading, as well as a center for arts, and various instructional areas. (McMurrin Tr. 2505) 4. Superintendent Johnson compared the facilities at the Hilliard City School District with the facilities at Plaintiff Northern Local School District. Northern Local School District has no auditorium. Hilliard had a fantastic auditorium and excellent gym facilities, as well as locker facilities. It would take Northern Local School District 4 mills to install the electric curtain raiser and some of the lights that the Hilliard City School District had for their stage area. Hilliard City School District had band rooms, excellent storage space, and individual rooms for students to play instruments. Hilliard had four different art rooms, where Northern Local only has one art room for grades six to twelve. Hilliard had a weight training room that is bigger than Northern Local's locker room. Northern Local's wrestlers practice in the high school cafeteria, whereas Hilliard had a well equipped wrestling room. Whereas Northern Local does not have working gas jets in the school district's laboratories, Hilliard has the latest in technology in all of the science labs. (Johnson Tr. 1486-87) 5. The Granville High School facility is far superior to the Sheridan High School facility at Plaintiff Northern Local. At Granville, lighting in classrooms is designed so that part of the lights can be on and part can be off for overhead projectors and other visual aids. Track lighting in the room can be used to emphasize different bulletin boards or chalkboards. Each room has its own telephone for security purposes. (Dilbone Tr. 2007) 6. At Granville High School, five language classrooms have the capability to be a portable language lab with cordless headphones for students to wear. (Dilbone Tr. 2007; 2012) At Sheridan High School, one Spanish teacher brought in an old reel-to-reel tape recorder and that was the language lab available for three or four students. (Dilbone Tr. 2011-12) 7. The science lab at Granville High School is twice the size of Sheridan High School's and is equipped with electric microscopes and racks of all new scopes. At Sheridan, microscopes were not electric. (Dilbone Tr. 2007-08) 8. Granville High School has a new greenhouse between two biology rooms and the biology teacher has his own office and storage area. (Dilbone Tr. 2007) 9. At Sheridan High School, explosive chemicals had been stored together, and when a new teacher was hired and pointed out the problem, those chemicals were separated, but Sheridan did not have adequate shelving. At Granville High School, safety and storage areas are provided. (Dilbone Tr. 2008-09) 10. At Sheridan High School, an extra table was needed for the art room because so many seniors who were required to take art were enrolled. The kilns were squeezed to the side of the room beside the table. At Granville High School, there is a separate room for sculpture and a separate room for kilns. Students at Sheridan were loosing art projects and things were being stolen because the teacher did not have a place to keep art projects. At Granville, each student has their own large drawer for keeping projects. At Granville, art rooms have tracking for lighting and there is an outdoor art studio for students to go outside and draw. The art teacher at Sheridan cannot offer students what the art teacher at Granville can because of facilities limitation. (Dilbone Tr. 2009; 2013) 11. Sheridan High School has one industrial technology room, while Granville High School has three rooms the size of the one room at Sheridan. One area is for mechanical drawing with all the latest equipment, another area is for lathes, computerized lathes, and CAD programs and communication programs. Another area is for woodworking and metalworking, which is loaded with equipment. There is a separate room for welding. At Sheridan, plastic partitions had to be erected so that students could weld in the same room. At Sheridan, only two or three students can weld, while ten students can weld in the facility at Granville. (Dilbone Tr. 2014) At Granville, there is a separate room for spraying. The teacher has a glassed-in office which overlooks all three industrial technology areas. (Dilbone Tr. 2009-10) 12. The gym at Granville High School is very large, well lit, and clean, with two large basketball floors and a balcony. The gym at Sheridan High School needs a new floor and has poor lighting. (Dilbone Tr. 2010-11) 13. There are separate library facilities at Granville for junior high and senior high students. At the senior high level at Granville High School, there are separate rooms for students to study in groups, a mock fireplace reading area, and the library is many times bigger than Sheridan High School's. (Dilbone Tr. 2011) 14. Granville High School has a dark room and a radio- television production lab, while neither of these are available to students at Sheridan High School. The dark room at Sheridan was converted into a chemical room for storage. (Dilbone Tr. 2012) 15. Sheridan High School's locker rooms are deplorable, and the men's showers have fungus growing on them because of the way they were built. A student could not be expected to take a shower at Sheridan High School. At Granville High School, locker rooms are carpeted with individual showers and installed hair dryers. (Dilbone Tr. 2015) 16. Pl. Exh. 450 is a videotape with narration that was prepared in 1992 and 1993. Videotape footage was taken of school buildings within seven school districts, including Plaintiff's Northern Local School District, Southern Local School District, and Dawson-Bryant School District, as well as Eastern Local School District in Brown County, Pickerington School District in Fairfield County, Nelsonville City School District, and Union Local School District in Belmont County. The videotape and narration thereon, and the description of the facilities contained in the videotape, are a fair and accurate portrayal of the conditions and facilities of the school districts observed and reflect the deplorable state of some of the school buildings shown. (White Tr. 2113-18) I. STATE INACTION 1. While the State of Ohio continues to underfund the building needs of the public schools, it has begun to study the needs for new state office facilities and has approved the initial expenditure of $37 million for the first phase of that project. This figure represents the cost of determining what the new state office needs are for Ohio and do not include any costs for construction. One proposal is for a hill-top campus in Columbus, the projected cost of which is $150 million. (Browning Tr. 4426-27) 2. Director Browning testified that he and other state officials believe that some of the existing state buildings are old, in poor condition and in need of replacement. He specifically referred to the headquarters of the Ohio State Highway Patrol. Director Browning described what was wrong with the building, including: it is too small for the purposes of the department; the layout of the facility and design of the facility are inappropriate for the needs of the Department of Public Safety; there are problems with making the facility adaptable to 21st century technology; the building was built earlier in this century; there have been a number of problems with plumbing, leaking roofs, structural problems, and asbestos; and the building is not entirely handicapped accessible. Assuming that the State goes forward in construction of a new building for the State Highway Patrol or any other agency, Director Browning testified that he would expect that new building would be built according to all applicable building codes. He and the Voinovich administration want to be assured of the safety of State workers and visitors to those buildings. Director Browning also wants those buildings to be handicapped accessible regardless of whether he is required to do so by state and federal law. (Browning Tr. 4429-32) The conditions of the Ohio State Patrol headquarters building, as described by Director Browning, are similar to those that exist in Plaintiffs' facilities, as well as many other public school facilities in Ohio. 3. The proposal for construction of new state office buildings includes bonds that will be sold for that purpose, and these bonds will be retired from the general fund, which is the same fund that is tapped for educational funds for primary and secondary education. (Browning Tr. 4432) 4. As of the time of trial, the General Assembly had included in the budget for the current biennium (fiscal years 1994-95) approximately $68 million to fund necessary projects approved through the Classroom Facilities Act. However, this program has not yet been funded. (Ocasek Tr. 2828; Phillis Tr. 1704; Browning Tr. 4419-20) 5. Of the proposed $68 million for facilities construction, this amount will not complete those projects contained on the approved Classroom Facilities Act building list, Plaintiffs' Exhibit 378. In fact, present law as it is written requires that school districts on the approved buildings list must be taken care of first. Not only will the present approved buildings list of school districts not be exhausted with the availability of $68 million, but neither will the buildings needs of the school districts (including Plaintiff Northern Local) who have submitted letters of request for building assistance. (Stip. Exh. 52; Browning Tr. 4419-20, 24; Ocasek Tr. 2818) 6. The $68 million represents less than 1 percent of the entire amount of public schools' facilities needs that have been identified by the State of Ohio. Stated another way, the 1990 Ohio Public Schools Facilities Survey determined that there was a total of $10.2 billion in facilities needs for public primary and secondary schools in Ohio. This is the equivalent of 10,000 million dollars, and the General Assembly has proposed funding only 68 of those 10,000 million dollars in the new budget. These dollars will not "catch up" with the facilities needs of the public schools. (Ocasek Tr. 2818; Browning Tr. 4425; Franklin Depo. 33) 7. In the amount included by the General Assembly in the budget for fiscal years 1994-95, for public schools facilities construction, there are no funds for the maintenance of the new facilities following completion of construction. (Browning Tr. 4419-20) 8. In 1993, Representative Shoemaker worked with Dr. Van Keuren in the Department of Education to develop a proposal to more adequately fund the Building Assistance Program. The proposal which passed the House on March 17, 1993, was for a $150 million Building Assistance Program which would provide immediate money to school districts. The funds would be made up of bond sales which would be retired by $10 million in initial lottery profits. The proposal met with resistance in the Senate, and the program which passed resulted in only $68 million being appropriated to the Building Assistance Fund. (Shoemaker Tr. 4141-44) 9. At the same time the General Assembly was approving only $68 million for school building assistance, Governor Voinovich and the General Assembly announced the proposal to sell State General Obligation Bonds to provide an extra $50 million per year for state and local parks, with a cap of $200 million outstanding at any one time. The purpose of these funds will be to maintain and upgrade state and local parks and recreation areas. These funds will be for facilities built in the 1950s and 1960s. This issue was passed at the last general election. The debt service for these $200 million worth bonds will come out of the general fund. These are funds from which monies from public education come. These funds will also be used to provide handicap access to the state and local parks facilities. (Browning Tr. 4433-34) 10. At the same time the General Assembly approved only $68 million for school building assistance, the State paid $5 million for a parking lot in downtown Columbus, even though there are no plans for building anything on it at the present time. (Browning Tr. 4428) 11. The State Board of Education strongly believes, and it is its position, in equalization both in facilities and in operating monies. (Ocasek Tr. 2824) 12. The State Board of Education, with respect to facilities, has proposed an equal yield concept, wherein the State takes under consideration the different taxpayer's millage in the various school districts to try to equalize so that the sum total of state and local money will be more in balance. No action has been taken by either the Voinovich Administration or the General Assembly to implement this proposal. (Ocasek Tr. 2823) IX. EDUCATIONAL INPUTS A. CLASS SIZE AND STAFFING RATIOS OVERVIEW 1. The Department of Education has the authority to enforce the requirements that educational service personnel be employed at the rate of at least five per thousand pupils and that the pupil to teacher ratio in grades K-4 on a district-wide average be not greater than 25 to 1. (Sanders Tr. 4577; OAC 3301-35-03(A)(3) and (4)) 2. In April of 1992, the Department of Education entered into a settlement agreement in a suit styled South- Western Education Association, et al. v. Ohio State Board of Education, et al., Franklin County Common Pleas Court, Case No. 88CV-04-2598, brought against it by the South-Western Education Association and others, alleging that the Ohio Department of Education was not enforcing the state standards regarding the K-4 pupil to teacher ratio and the education service personnel per pupil ratio in public schools. (Russell Depo. 81; Stip. 107; Stip. Exh. 38, 39) 3. As a result of that settlement, letters were sent to 120 Ohio school districts indicating the Department's belief that they did not satisfy required K-4 pupil to teacher ratio and education service personnel per pupil ratio. (Russell Depo. 82; Pl. Exh. 418; Pl. Exh. 454) 4. The 1983 Minimum Standards also require that school districts maintain at least 25 to 1 pupil to teacher ratio on a district-wide average (OAC 3301-3503(A)(3)), but that standard was not the subject of the settlement agreement in South-Western et al. v. Ohio State Board of Education, et al. (Stip. Exh. 38), and no letters were sent regarding violations of that requirement. (See Russell Depo. 82) 5. As a result of the Southwestern Education Association litigation, 45 school districts, including Plaintiff Northern Local School District, were found to be out of compliance with the mandated 25 to 1 K-4 pupil to teacher ratio. (Pl. Exh. 439; Stip. 108; Sanders Tr. 4587) 6. As of June 15, 1993, the Northern Local School District as well as approximately 30 other public school districts in Ohio did not comply with the requirement that it employ sufficient Educational Service Personnel teachers to meet the 25 to 1 standard. (Van Keuren Tr. 4713-14) 7. Area coordinators do calculations to determine whether districts meet the classroom pupil to teacher ratio and educational service personnel to pupil ratio. Twelve to fifteen school districts in Area 5 were notified that they were out of compliance with one or both of those ratios. After reviewing the data, four of those districts were found to be out of compliance in FY93. Those districts were required to send letters to the Department of Education indicating that before FY94 they would employ sufficient personnel to meet the standards. (Taylor Depo. 61-64) 8. As a result of the Department of Education's settlement agreement of the South-Western Education Association case, the South-Western City School District was required to employ 6 1/2 additional full-time equivalent employees. Some of the other 30 school districts found to be out of compliance and who were required to hire additional employees were districts that were in the loan fund at the time they were notified of the requirement to hire additional employees. The Department of Education has no information about how such districts are to obtain the funds to pay the costs of these additional staff. (Van Keuren Tr 4789-90) 9. Compliance with the mandated 25 to 1 pupil to teacher ratio could require additional staff, supplies, and facilities. (Russell Depo. 83; Goff Depo. 174) 10. Before a school district can employ additional personnel it must first determine that it has funds to pay the cost. (Sanders Tr. 4580) 11. If any of the Area 5 districts found to be out of compliance with the required pupil to teacher ratio and were required to borrow funds to hire additional employees to meet the standards, those districts would also be required to examine possible staff reductions when considering how to construct a repayment plan. (Taylor Depo. 65-66) 12. The Select Committee to Review Ohio's Education System recommended that the ratio of students to teacher in grades K-4 should never exceed 25 to 1 and be funded accordingly. The recommendation with regard to funding was not implemented by the legislature. (Shoemaker Tr. 4100) 13. Students in large class sizes receive less individual attention from a teacher than they would if the class size was lower. (Dilbone Tr. 2004) 14. Even if a school district is in compliance with the required 25 to 1 pupil to teacher ratio on K-4 or district-wide, that school district may still have class sizes much larger than 25 pupils because the ratios are computed on district-wide averages. (Johnson Tr. 1598; OAC 3301-35-03(A)(3)) CLASS SIZE AND STAFFING RATIOS IN PLAINTIFF SCHOOL DISTRICTS 15. The 1983 Minimum Standards require school districts to maintain a ratio of a minimum of five full-time equivalent education service personnel (ESP) per l,000 students. (OAC 3301-35-03(A)(4)) The ratio of ESP to students in two Plaintiff School Districts as of March of 1993 according to Ohio Department of Education records was below the state requirement as follows: SCHOOL DISTRICT RATIO OF ESP PER 1,000 PUPILS Dawson-Bryant LSD 3.33 Northern LSD 2.77 (Pl. Exh. 395) DAWSON-BRYANT 16. Jamie Blankenship's class sizes in elementary school at Plaintiff Dawson-Bryant Local School District have ranged from 27 to 30 students per class. (J. Blankenship Depo. 19) 17. In the 1st, 3rd, 4th, 5th, and 6th grade levels in Dawson-Bryant Local School District, Christopher Jackson's class was combined with another grade level, which was called split-level classes. (Jackson Depo. 33-34) 18. At Dawson-Bryant High School, there are three full-time science teachers, and the transportation supervisor teaches two science courses at the high school. (Semanco Depo. 7; 33) Mr. Semanco teaches biology I, biology II, and chemistry and he is assigned bus duty, cafeteria duty, and hall duty. His volunteer services to the students include after-school tutoring for proficiency tests, chaperoning dances, coordinating a science fair, and a science club. (Semanco Depo. 8-9; 30) 19. The large numbers of pupils in science classes at Dawson-Bryant High School present a problem, particularly in biology and chemistry, because of the limited facilities and equipment. (Semanco Depo. 4950) 20. The recommended caseload for a psychologist is 75 to a maximum of 125 new referrals for multi-factored evaluations. Last year, the psychologist serving Dawson-Bryant worked with between 150 and 160 new referrals in only two days per week. (Washburn Tr. 2323-24) 21. In contrast to the class sizes at Dawson-Bryant, in the Beachwood City School District, in grades 1-3 there are approximately 20 pupils per classroom. Each class has a small lab and a television/VCR combination. (McMurrin Tr. 2506-07) LIMA 22. Since FY89, the overall pupil to teacher ratio in the Lima City Schools has increased from 17.88 to 18.03. (Buroker Tr. 3072-73) 23. The Lima City School District operates a number of "split classes" where it is necessary to combine multiple grades in order to effectively utilize a classroom. Because of the requirements of the district's negotiated collective bargaining agreement, it is required to include a teacher's aide in any classroom in which enrollment exceeds 30. In order to minimize the number of teacher aides employed, the district utilizes "split classes." (Buroker Tr. 2895) 24. The Lima City School District employs four nurses to serve the student population of 6,250 pupils. (Buroker Tr. 2898) In many cases, the school nurses serve as the first line of health services for pupils in the district. (Buroker Tr. 2898) 25. The Worthington City School District has a higher level of nurses per student than does Lima City School District. (Buroker Tr. 2946) 26. Worthington City Schools has nine psychologists compared to three at Lima City Schools. The individual case load of psychologists at Worthington is 30 evaluations per year compared to 120 to 150 evaluations done by psychologists in the Lima City Schools. (Buroker Tr. 2946) 27. Additional personnel are needed at Lima City Schools to coordinate activities with the community, including adopt-a-school programs, intervention programs, and other programs. Additional personnel are needed to identify student's needs early and intervening early. Students move through the district without proper study skills and critical thinking skills. Many of these things require individual intervention with students. (Roger Miller Depo. 68) NORTHERN LOCAL 28. The ADM at Plaintiff Northern Local School District has increased by 46 students per year over the last three years. Superintendent Johnson attributes this to people moving into five acre plots and putting trailers into those areas. (Johnson Tr. 1393) 29. Superintendent Johnson has been advised by the Ohio Department of Education that the Northern Local School District is in violation of 25 pupils per teacher requirement at the primary level, but that has been remedied. (Johnson Tr. 1391, Pl. Ex. 128 and Tr. 1511) 30. To determine compliance with the 25 to 1 pupil to teacher ratio requirement, the Ohio Department of Education divides the total number of K-4 teachers a district has by the number students. Northern Local was found to need another elementary teacher at the K-4 grades, but Northern Local could not afford to hire another teacher and there was no place to put another classroom. (Johnson Tr. 1392) 31. In Northern Local for the 1993-94 school year, at Thornville Elementary there are two 2nd grade classes with 34 and 35 students. At Glenford Elementary, there are classes with over 30 students. In the high school they have some Spanish classes with over 30 students in a classroom. The biology class has 190 students for seven Periods. (Johnson Tr. 1388) 32. Students in grades K-3 in Glenford Elementary School in Northern Local School District share a physical education teacher and a music teacher with students in the same grades at Somerset Building in Northern Local School District. Students at the Intermediate Building in Northern Local School District share a physical education teacher and a music teacher with students at the Thornville building. (Spohn Depo. 14) 33. The Glenford Elementary School in Northern Local School District does not have an art teacher. (Spohn Depo. 16) 34. Within the last three years, services to Glenford Elementary students were reduced by moving a classroom aide to the high school for intervention. (Papritan Tr. 1918) 35. Northern Local School District has only one principal for grades 7 through 12. (Johnson Tr. 1430) 36. The principal at Glenford Elementary works 10 to 12 hour days and 7 days per week at times. She generally works 12 months with little vacation, although she is paid for and is required to work only 10� months. She volunteers her time because the buildings are old and need much work. (Papritan Tr. 1918-27) 37. Class size is a problem at Glenford Elementary. In 1992-93, 32 1st graders were in one classroom and one 6th grade classroom had 38 students and another had 39. Ninety-nine percent of the students in the large 6th grade classes tested as having a deficiency in at least one area of reading. These students have had over 30 children in their classroom since kindergarten, and they have proceeded up through the elementary grades with large class sizes. These students will have no opportunity to have smaller class sizes until they reach the junior high level. The Iowa Test of Basic Skills showed that these 6th grade students were a grade behind in achievement. That test also showed that all sections with large class sizes were behind. Students are not receiving appropriate intervention because class sizes are too large. (Papritan Tr. 1952-55; Spohn Depo. 57) 38. Integrated approaches to learning require observation and determination whether a child's needs are being met on an individual basis. That cannot be done effectively with 38 and 39 children in a classroom. Class size needs to be below 23. (Papritan Tr. 1952-53) SOUTHERN LOCAL 39. Southern Local has a lack of teachers needed for intervention and appropriate class sizes, and a lack of teachers in some certification areas such as secondary reading. (Spangler Tr. 497-98; 590) 40. Introductory mathematics, science and English courses in Plaintiff Southern Local School District all have more than 25 students. (Axline Depo. 33-35) 41. Every class taught in the 7th and 8th grades in Southern Local has between 26 and 30 students. (Towner Tr. 839) 42. There are more than 25 students in many elementary classes in Southern Local School District. In the 1991-92 school year, one 3rd grade class had 33 students and a 1st grade class had 28 students. (Lichtenstein Depo. 46-47) 43. In 1992-93, class sizes at Southern Local in Science I and Algebra I were too large, resulting in too little individual student attention and causing students to repeat courses. (Thompson Tr. 1322-23) 44. Joseph Winnenberg teaches five separate courses, and therefore has five different course preparations each day. These preparations include developing lesson plans, providing evaluations of the students, and presentation. (Joe Winnenberg Tr. 748) 45. Superintendent Spangler performs many functions that other superintendents would not be performing directly. Southern Local has no public relations person, no director of curriculum or director of special education, and has only one 12-month administrator, which is the Superintendent. (Spangler Tr. 429) During the construction project at Southern Local, the district did not have a construction manager; rather, the Superintendent performed those duties. (Spangler Tr. 429-33) 46. Southern Local does not have an administrator to make daily purchases for the school district. Instead, the Superintendent makes purchases for the district, including items such as lettuce, paint, and some basic supplies, which she routinely pays for out of her own personal funds. (Spangler Tr. 436-38) 47. If Southern Local had the financial means to hire additional personnel, such as transportation supervisor, cafeteria supervisor, or maintenance supervisor, the district could move away from crisis management. Administrators could spend time and attention evaluating what students need and making short and long range plans to meet those needs. YOUNGSTOWN 48. There are many overcrowded school buildings in Plaintiff Youngstown City School District, and there are many classes where the pupil to teacher ratio is well above 25 to 1. (Kolitsos Depo. 78-79) 49. From 1987 to 1989, the district cut teaching positions and reduced non-certified positions by not replacing personnel who left. Teachers on special assignment to assist in seven elementary and five high school buildings were cut. Guidance counselors were cut from three guidance counselors in each of the high schools to two and one-half in four and two in the other high schools. Extended time for speech therapists, audiologists, and psychologists were cut, and administrative positions were cut. One elementary reading supervisor was not replaced, and the Coordinator of Consumer Education and the Coordinator of Gifted Education were cut. Non-certified positions were also reduced, including educational assistants and secretaries. Over the two-year period at least thirty teachers were non-renewed. (Marino Tr. 3175-78) 50. Youngstown City School District plans future cuts in personnel. In 1991-92 school year, 18 elementary teachers were non-renewed for financial reasons, and up to 80 teachers were to be non-renewed for the 1992-93 school year. Such cuts will limit the curriculum that the district will be able to offer. (Hiscox Depo. vol 1, p. 46-47; Hiscox Depo. Exh. 1) 51. As of the 1992-93 school year, the district also planned to reduce the numbers of professional staff, including psychologists, speech and hearing therapists, nurses, social workers, B-site technicians, clerical workers, teacher aides library aides, and custodians. (Hiscox Depo. vol 1, p. 49-50) 52. In the 1991-92 school year, Youngstown cut one-half of one secondary guidance counselor, and the district plans to cut two additional secondary guidance counselors in the future. After these cuts, 12 guidance counselors will remain for the entire district at the high school level. (Hiscox Depo. vol 1, p. 48; Hiscox Depo. Exh. 1) 53. For the 1993-94 school year, the district projected a reduction in force of approximately 80 additional teachers, in addition to cuts of educational assistants, counselors, psychologists and speech and hearing specialists. During that time period, the district was also faced with cuts to the reading, mathematics, and civics programs. (Kolitsos Depo. 27) 54. Split classes are implemented at Youngstown City Schools due to lack of funding. (Marino Tr. 3246) In Youngstown, at the high school level for FY94, all of the teachers are required to teach six Classes. Some teachers must prepare for more different courses than is appropriate. (Marino Tr. 3259) 55. Although the 1991 vital statistics for the Youngstown City School District show a pupil to teacher ratio of 18.8 pupils per teacher, that is an artificially low number. Youngstown City School District includes non- teaching personnel, such as visiting teachers and other administrators, in that figure, whereas other school districts in the state may not. (Hiscox Depo. vol 1, p. 63-64; Marino Tr. 3206-08) 56. Other factors that decreased Youngstown City Schools' pupil to teacher ratio but have not resulted in smaller class sizes for most regular education students include: a. The distract had to add 23 special education units between the years 1987-88 and 1990-91 requiring 23 additional special education teachers. (Marino Tr. 3439; Stip. Exh. 28) b. The district also had to add teachers to begin serving preschool handicapped students as required by law. (Marino Tr. 3440) c. The bilingual program added teachers to the pupil to teacher ratio. (Marino Tr. 3209-10) d. Four teachers were also added to fulfill an applied academics program at the career center funded through vocational units. (Marino Tr. 3440) e. Since 1983, the district has had in place a much needed secondary reading program in the junior highs and high schools that required additional teachers. However, the reading program was eliminated in FY94. (Marino Tr. 3209) f. The home economics and industrial technology programs maintained by the district also decreased the pupil to teacher ratio because of the maximum student loads for those teachers and the limited number of stations available per pupil in some of those programs. The home economics and industrial technology programs have been maintained thus far, because of the needs of students and the fact that these courses deal with self-esteem issues and provide the opportunity for students to assist their plans for vocational programming. The industrial technology program will be a consideration for reduction as the result of the district entering the loan fund. (Marino Tr. 3211-12) g. In FY93, the district employed 5 visiting teachers who search out students not attending school and try to find social services to assist those students. One position was eliminated in FY94. (Marino Tr. 3240-41) 57. Eight licensed practical nurses service the 30 buildings at Youngstown City Schools. (Marino Tr. 3234) In FY93, Youngstown City Schools had a physician 1 1/2 hours per day. (McGee Depo. 11) The positions for a supervisor of health services and part-time medical doctor were eliminated in FY94. The duties of those persons have been given to other persons who already have full-time duties. (Marino Tr. 3234) 58. The district does not have sufficient personnel to address the areas of special needs students and at-risk students. (Hiscox Depo. vol 1, p. 51) 59. Youngstown City School District does not have a grant writer. (Marino Tr. 3438) 60. Youngstown City School District does not have certified librarians in any of the elementary libraries. The educational assistants that have been hired to oversee the library have been given some training, but it is not adequate. The district cannot afford to put certified librarians in the elementary libraries. (Marino Tr. 3232) 61. For FY94, 18 to 20 persons were cut from the Youngstown City Schools' central office staff. (Marino Tr. 3354) 62. Area Coordinators are responsible for posting vacancies for school districts to meet the requirement that a vacancy must be posted for a two-week period of time before a temporary certificate may be issued. A temporary certificate is necessary for an otherwise not properly certified person to fill the position. Special education is the most common vacancy posted in the Area 5 Coordinator's office. (Taylor Depo. 24-27) 63. If school districts were able to offer higher salaries to attract personnel, it would alleviate problems of recruiting for specialized positions such as special education, physical therapy, speech therapy, and foreign language teachers. Specifically, physical therapists employed in private industry or private practice can make $33 per hour or more. Those persons are not inclined to become school physical therapists at salaries offered by school districts. (Taylor Depo. 282-83) 64. Superintendents have been recruited from Area 5, an area which includes Plaintiff Dawson-Bryant Local School District, to other areas of the state, and superintendents have left for higher paying jobs in other areas of the state. (Taylor Depo. 55) B. PAY SCALES AND RECRUITING OF STAFF OVERVIEW 1. The state minimum salary schedule is an indexed salary schedule that includes annual incremental increases based on years of experience as well as different columns for different levels of training (R.C. 3317.13). Most Ohio school districts pay teachers on a similarly indexed salary schedule. Under such a schedule, most teachers will receive annual pay increases even though the base salary does not change in that year. (Tavakolian Depo. 86) 2. Increases in the State minimum teachers' salary in budget bills have carried with them a provision to increase non-teachers' salaries by a like percentage. (Tavakolian Depo. 169) 3. Since 1987, the average percent wage increase for local school districts has been between 3 and 4 percent. (Pl. Exh. 452; Pl. Exh. 441) 4. Indexed salary schedules are one of the factors that increase the costs of school district operations from year to year. A district in need of additional revenue would, because of annually increased operating costs (including salary costs), need to pass a greater rate of additional millage in each year that the need continued. (Russell Depo. 143) 5. School district expenditures for salaries and fringes are the most volatile of school district expenses. In recent years, increases in the cost of health care benefits have increased at a faster rate than salaries. (Brown Depo. 27) 6. Average teacher's salary on the vitals program (Stip. Exhs. 4-8) is affected by the experience level of the teachers in the district and the education level of the teachers in the district. (Washburn Tr. 2342-43) 7. The cost of teachers is the single largest element of a school district's budget; the cost of non-teaching personnel is the next largest. (Brown Depo. 203) 8. When a teacher attains additional education or additional experience, that teacher's contract may not be suspended or terminated in order to hire a teacher that might be less expensive. (Washburn Tr. 2343-44) 9. Ranked by deciles of property valuation, the median district average teacher salary in the highest decile for 1990-91 is $35,846 and the lowest decile is $27,521. As wealth declined, the median teacher salary also declined. (Alexander Tr. 3680; Pl. Exh. 301 p. 116) 10. The average teacher salary in the Plaintiff school districts is less than the average teacher salary in the rich districts (using the median of rich district average salaries). (Alexander Tr. 3679; Pl. Exh. 301 p. 115) PAY SCALES AND RECRUITING OF STAFF IN PLAINTIFF DISTRICTS 11. Pl. Exh. 204 is a chart showing teachers' beginning and average salaries for the state and for the plaintiff school districts for the years 1983-1991. Exh. 204 is a true and accurate summary of information contained in annual salary study books published by the Ohio Department of Education, Division of Computer Services and Statistical Reports, which have been admitted into evidence as Pl. Exh. 193-203 for the years 1981-1991. As demonstrated by Pl. Exh. 204, for FY1990-91, each of the plaintiff school districts offered its teachers an average salary which was below the state average salary, and all of the plaintiff school districts, except Lima City and Youngstown City, offered beginning salaries below the state average beginning salary. (Fletcher Tr. 2637; Pl. Exh. 204; Pl. Exh. 193-201) DAWSON-BRYANT 12. In comparing average teachers' salaries among the various school districts in Lawrence County, five school districts paid more than the average teachers' salaries of Dawson-Bryant. (White Tr. 2166; Pl. Exh. 276; Washburn Tr. 2342) 13. Teachers at the Dawson-Bryant Local School District have years of teaching experience and education levels that are greater than the state average. Specifically, Dawson-Bryant teachers' average experience is 2 1/2 years above the state means, and percent of teachers holding a bachelor's degree plus 150 total semester hours is 5.3 percent above the state mean. (Washburn Tr. 2343; Stip. Exh. 4) 14. Three Dawson-Bryant teachers have interviewed for positions in other districts locally because those districts offered higher salaries. Another teacher was to be hired by a neighboring school district at a salary increase of $7,000. (Washburn Tr. 2344-45) 15. A teacher at Dawson-Bryant with 27 years of experience, with a Master's degree and 30 semester hours of education above the Master's degree, would earn less than an average teacher in the State of Ohio, regardless of their experience and degrees. (Washburn Tr. 2345) 16. The salary schedule at Dawson-Bryant is inadequate to attract certificated people to move into the area. It is not competitive within the county or within the state. Teachers from the area have not been exposed to many cultural experiences and new ideas and methods of instruction. (Washburn Tr. 2346) 17. Dawson-Bryant could not obtain a speech pathologist for two consecutive years. One year the district received no applications; another year the only applicant took a job in another state working 21 hours a week at a salary $8,000 above Dawson-Bryant's full-time salary. (Washburn Tr. 2347) LIMA 18. Lima City School District spends approximately 87 percent of its total general fund budget on salary and fringe benefits. (Buroker Tr. 2992) 19. The Lima City School Districts' teachers have on the average one more year of experience than the state average, but the district's average teachers' salary is about $3,312 below the state average. (Stip. Exh. 5) 20. The Lima City School Districts' average teachers' salary is lower than all of the other districts of its type in the state. (Stip. Exh. 5) NORTHERN LOCAL 21. Plaintiff Northern Local School District has lost teachers due to lack of competitive salaries. The district lost a chemistry/physics teacher to a Columbus suburb, another chemistry/physics teacher to West Virginia University, a DH teacher to Heath City Schools, and a special education teacher to Cambridge City Schools. High school principal Chuck Dilbone went to Granville for a higher salary. In addition, the school district has been forced to reduce teacher aides, a maintenance supervisor, administrators, a home economics teacher and a business teacher. (Johnson Tr. 1475-76) 22. Northern Local School District cannot hire more experienced teachers because it does not have the funding to do so. Therefore, the school district is forced to hire beginning teachers whose salaries are lower. The trend toward hiring less experienced teachers has been more prevalent in Northern Local School District in the last 10 years. (Hill Depo. 4344) 23. Northern Local School District does not repair or replace its buildings, furniture, materials or supplies as much as the Board would like because salaries consume the budget. (Hill Depo. 45) SOUTHERN LOCAL 24. For average teacher's salary, Southern Local ranks 557th in the state, which means that 556 school districts pay their teachers more on the average. (Stip. Exh. 7) 25. Also, wages paid to non-teaching employees are low for the county and low for the region. (Spangler Tr. 73536) 26. The district has trouble recruiting teachers in specialized areas, such as special education and dual certification. (Spangler Tr. 735-36) 27. Between FY90 and FY91, the costs of benefits provided to district employees increased 27 percent, which was attributed to health care costs, and not as a result of adding any additional employees. (Spangler Tr. 586-87) YOUNGSTOWN 28. At Youngstown City Schools, the average teacher's salary for FY91 was $32,485, below the state's mean for that year of $35,326. (Stip. Exh. 8) 29. At Youngstown City Schools, it is important to have minority teachers on staff for the students and because the district is under a federal court mandate to have a racially balanced staff. (Marino Tr. 3183-84) 30. The district has generally hired inexperienced teachers because they can be paid less than experienced teachers. (Marino Tr. 3179) 31. The district has had difficulties attracting teachers with certification in more than one area and much difficulty attracting minority staff. The salary schedule at Youngstown City Schools is not adequate to draw teachers into the community and is not adequate to recruit minorities. (Marino Tr. 3179-80; 3183) C. COLLECTIVE BARGAINING 1. Since April 1, 1983, school districts have been required by law to engage in collective bargaining with employee organizations designated as exclusive bargaining representatives for employee bargaining units. (Stip. 46) 2. Many public school districts engaged in collective bargaining with employee groups prior to April 1, 1983. However, on that date, public schools and other public employers in Ohio were for the first time required by law to engage in collective bargaining with employee groups. Most school districts have two unions, teaching and non-teaching. (Russell Depo. 59) The Cleveland City School District has more than nine recognized collective bargaining representative organizations. (Russell Depo. 60) 3. The only school district employees not subject by law to any collective bargaining agreement are the Superintendent and Treasurer of the school district. (Russell Depo. 67) 4. The vast majority of Ohio school districts have negotiated collective bargaining agreements. Most of the 85 percent of general fund revenue that goes for salary and benefits goes to employees pursuant to collective bargaining agreements. (Brown Depo. 36) 5. For the 1992-93 school year, 21 out of 661 public school and joint vocational districts in the state of Ohio were not subject to at least one collective bargaining agreement. (Stip. 48) 6. School districts are required to file their teaching contracts with the State Employee Relations Board (SERB). (OAC 4117-09-07) As of December 31, 1992, there were 631 teaching contracts and 523 non-teaching contracts on file with the State Employee Relations Board. (Pl. Exh. 440) 7. The required scope of collective bargaining includes all wages, hours and terms and conditions of employment as well as the modification or deletion of any provision of an existing collective bargaining agreement. (Stip. 47) 8. Negotiated collective bargaining agreements normally include provisions for health and life insurance; provisions restricting the right of the board to limit teaching contracts. (Russell Depo. 60) 9. School district collective bargaining agreements often contain provisions that limit the ability of school districts to reduce the size of their teaching or non- teaching staff. The Department of Education expects school districts to abide by provisions in negotiated collective bargaining agreements. (Phillis Tr. 1900) 10. School district officials are required by law to certify the availability of funds to pay increased salary or benefit costs resulting from a collective bargaining agreement. That certification must include the availability of funds to operate the district's educational program and to pay the costs of the increase for the current year and the next succeeding school year. Form SF-12 is one of the documents used in the process of that certification. (R. C. Section 5705.412; Van Keuren Tr. 4752; Russell Depo. 61) 11. Collective bargaining agreements may cover a period of up to three years, one year beyond the period for which the availability of funds must be certified. (R.C. Section 4117.09(E); Russell Depo. 61) 12. As a result of mandated collective bargaining, school districts now hire trained negotiators. (Russell Depo. 61-64) 13. Collective bargaining negotiations involve the time and efforts of the board of education and the school district administrative staff, as well as any outside professional staff that may be used. Such negotiations can go on for a year or more. (Russell Depo. 66) 14. Responsibility for participating in the negotiation of collective bargaining agreements is often part of the responsibilities of Ohio school superintendents. Activities associated with collective bargaining involve the expenditure of substantial amounts of administrative time and effort. Collective bargaining agreements that result from those bargaining activities often included provisions for salaries and health care benefits, among others. (Van Keuren, Tr. 4739-40; Washburn Tr. 2328) 15. For most public school districts in Ohio, 85 percent or more of the total operating revenue is spent on staff salaries and benefits obligated under one or more collective bargaining agreements. (Russell Depo. 72) 16. Each of the Plaintiff School Districts is required to engage in collective bargaining with each recognized employee bargaining unit not less than once every three years. (Stip. 49) 17. Since 1983, Kenneth Taylor (Area 5 Coordinator) has seen salaries and fringe benefits become an increasing portion of the budgets of school districts in Area 5, which includes Plaintiff Dawson-Bryant. One of the reasons is the requirement that school districts collectively bargain with their employees. Another reason is inflationary increases in costs. (Taylor Depo. 91-92) 18. Much of the time of school administrators at Dawson- Bryant Local Schools is taken by collective bargaining, including issues dealing with employment and working conditions. (Washburn Tr. 2328) 19. In the fall of 1992, Dawson-Bryant Local School District Board of Education had a teaching force that had been without a contract for a year and was faced with an important school facilities levy on the ballot that required the support of staff members. The board determined that a 2 percent increase for teaching staff could be granted based upon projected increases in revenues the district would receive through the state funding formula. (Washburn Tr. 2329) After the Board contractually agreed to the 2 percent increase, student enrollment figures from October became available showing that enrollment declined. Thus, costs did go up, but revenues did not go up accordingly. (Washburn Tr. 2330) 20. The Dawson-Bryant Local School District had moved into a self-funded insurance plan for its employees because of the high cost of obtaining health insurance for employees. In the fall of 1992, district officials obtained a commitment for a fully insured program and avoided the additional risk of self-insurance with a reduced benefit package for employees. The Board was prohibited from implementing the new health insurance program by a grievance filed by a teacher over the reduction in benefits. Fourth quarter claims experience for the district became available, and the companies that had offered coverage under the fully insured option withdrew their offer, and provided the board with a quote in excess of $800 per month for a family plan that excluded certain employees of the district. (Washburn Tr. 2331-37) Previously, insurance costs for a family plan were about $400 per month and $169 per month for a single plan. Of that cost, 75 percent of the cost is paid by the Board for family plans and 80 percent of the cost is paid by the Board for single plans. The proposed rate of $800 per month was not only unacceptable or unaffordable for the district, but also for many of the certified and noncertified employees. The board had no choice but to attempt to find other options for insuring all of its employees. With one day of insurance coverage left, the Board found an insurance company to accept their program, which was a self-insurance program. The district is responsible for the first $25,000 of costs per employee. (Washburn Tr. 2338-39) If the district's insurance coverage had expired and no coverage could have been found, the district would have been responsible for the benefits of all employees, including the total cost of any claims that they may have incurred, as well as administering the cost of those claims which would have greatly jeopardized the financial status of the district. With great effort, the Board negotiated a reduction in benefits that included more out-of-pocket expenses for the employees and less insurance coverage for those employees. (Washburn Tr. 2340-41) 21. Health care costs have severely impacted the finances of the Dawson-Bryant Local School District and other school districts in the state. (Washburn Tr. 2330-41; 2348) 22. Collective bargaining has severely reduced the local control of the Dawson-Bryant Local School District and other school districts in the state. (Washburn Tr. 2328-41; 2348) 23. Prior to the time Northern Local School District began collective bargaining with its teachers' union, salaries and benefits accounted for approximately 72-75 percent of the Board's total budget. Currently, due to collective bargaining, salaries and benefits account for about 83 percent of the district's total budget. (Hill Depo. 46-47) 24. Over the past twenty years, collective bargaining in Youngstown has been difficult due to the school district's financial situation. Only one contract out of the last 5 contracts has been settled on time without some sort of a labor action. The trend has been a movement from two-year contracts to three-year contracts with a balloon payment in the third year of the contract. That balloon payment has a negative impact on the school district's financial situation. (Hiscox Depo. vol 1, p. 71-72) 25. In the fall of 1987, Youngstown City School District had a teachers' strike that closed the schools for 17 school days. (Marino Tr. 3175-76) 26. Health care costs for Plaintiff Youngstown City School District are approximately $4 million per year. If the district decided that it wanted to charge its employees for health care, that decision would have to be negotiated with the employee unions. The district has attempted to negotiate such a change. (Hiscox Depo. vol 1, p. 35-36) 27. In the fall of 1993, Youngstown City School District had a teachers' strike that closed the schools for 18 school days. The issues that caused the strike included a proposed reduction in the benefit package, salaries, insufficient staff development with the piloting of new instructional methods at the pilot learning centers, and inadequate materials and instructional supplies, including textbooks. Teachers were also concerned that the district would not renew teachers' contracts because of insufficient funds. The teachers' union and representatives of the school board were in court on a daily basis before Judge Kirchbaum, and then the board members, the superintendent and a negotiating team were locked into a room for several hours and finally came to a resolution. The benefit package was maintained, there was a freeze in salary for FY94, a five percent increase for FY95 and a five percent increase for FY96. The board and teachers agreed to staff development as much as possible for the learning centers and a $40 per student purchase of instructional materials for students. (Marino Tr. 3188-90) 28. Youngstown City Schools will make up the school days that were missed as a result of the strike by scheduling school through June 23, 1994; however, some students will not attend school during the make up days. Even if days are made up, however, a strike is extremely disruptive for students. Students in Youngstown were on the streets with no where to go. No schools in the area were accepting Youngstown students, and people were trying to move out of the district. Also, some students did not have media available and did not know that school started so they did not return to school on time. Also, students who attended summer school, and needed to pass the proficiency test, did not have a classroom to attend in the fall of 1993 to continue their progress because of the strike. (Marino Tr 3191-93) D. TEACHER CERTIFICATION AND TRAINING 1. The Ohio Department of Education accredits institutions of higher learning that offer teacher education programs. (Sanders Tr. 4572) 2. Individuals may not be employed and paid as public school teachers in Ohio unless they hold teaching certificates issued by the Ohio Department of Education. (Sanders Tr. 4573) 3. In-service teacher training and pre-service teacher training are critical for reforming and restructuring education in Ohio. Without these programs, the lea