Orleans Parish School Board Files Federal Motion To Dismiss Lusher/ Lake Forest Lawsuit Regarding Student Formula Funding

NEW ORLEANS – The Orleans Parish School Board (OPSB) filed a motion Monday, May 2, 2016, seeking to dismiss a federal lawsuit filed on behalf of Lusher and Lake Forest charter schools for lack of jurisdiction and improper venue. The motion also says the Lusher/ Lake Forest suit violates their operating agreements with the OPSB.

         The Lusher/ Lake Forest litigation involves state appropriated funding for special needs students in Orleans Parish.

         Lusher and Lake Forest were among the beneficiaries of an inequitable distribution of school funding. The two schools enroll students with special needs, including students with disabilities and limited English proficiency, at rates significantly below the parish-wide average upon which their MFP allocations have historically been based. OPSB reps said this allowed Lusher and Lake Forest charter schools to accrue significant cash reserves over several years. Their most recent audited financial statement revealed Lusher’s net assets exceed $19 million, including more than $16 million cash and investments. Lake Forest’s net assets exceed $5.7 million.

         In 2015, the state legislature adopted Act 467, requiring the development of a differentiated funding formula for the equitable distribution of MFP funds in Orleans Parish. The formula was supposed to ensure funds allocated to students falling into one of four categories be paid to schools educating those students, OPSB reps said. As neither Lake Forest nor Lusher educate students requiring special education services in proportion with the parish-wide distribution of such students, and the two schools will no longer receive a disproportionate share of the supplemental funding designated for that purpose, the differentiated funding formula is less favorable to Lusher and Lake Forest than that which was in place before the adoption of Act 467. However, OPSB reps said, any reduction to either school’s allocation cannot exceed two percent of the MFP funds for year 2015-16. According to most recent estimates, the maximum reduction applicable to Lusher is approximately $300,000; the maximum reduction applicable to Lake Forest is approximately $105,000.

         Lusher’s investment income from its reserves in 2015 would exceed the proposed maximum reduction in its budget next year, OPSB reps said.

         OPSB attorney Brent B. Barriere of Fishman Haygood, L.L.P. said his client recognizes Lusher and Lake Forest charter schools would like to obtain as much operating funding as possible, but given the limits of state funding for public education, priorities must be established.

         “This litigation is about finding an equitable way to allocate precious resources,” he said.

         Barriere said the motion to dismiss the case is compelling. “It is clear that Lusher and Lake Forest have not been deprived of due process,” he said. “A representative of the schools participated in the collaborative process that recommended the funding formula, and they will have the opportunity to participate in the public hearing on the OPSB’s 2016-17 budget.”

         He also said public school funding is uniquely within the purview of the states, and federal courts should defer to state courts to resolve disputes such as school funding.

         “Any lawsuit regarding school funding should properly be in local civil district court and not the federal court,” he said. “In fact, Lusher and Lake Forest agreed in their operating agreements to do exactly that.”

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