Schools sue state for diverting education funding to inmates
School systems across the mountains are signing on to a lawsuit against the state to recoup hundreds of thousands of dollars that they say were improperly diverted from public school coffers.
Haywood, Jackson, Macon and Swain school boards are among dozens of counties statewide to join the suit.
The suit claims that the state legislature wrongfully siphoned off fines for traffic violations that should have been earmarked for public schools.
“The state constitution says all fines and forfeitures must to go to the local school board,” explained Pat Smathers, attorney for the Haywood County school board.
However, that wasn’t happening when it came to the fine paid by motorists for “improper equipment.” The state has been keeping the money over the past four years to pay for housing inmates.
School systems have filed suit demanding that the money collected through improper equipment fines be returned.
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“By law, our students are entitled to these funds. Our board felt that it was important that we stand up for our students and fight for these resources,” said Dr. Chris Baldwin, superintendent of Macon County Schools.
The statute of limitations means schools can recover only three years’ worth of the back fines. That would amount to $82,500 in Haywood, $95,500 in Jackson, $42,500 in Macon and $34,000 in Swain.
While the fine for improper equipment is only $50, it’s common to see hundreds of these tickets given out in a county over the course of a year. Improper equipment could be as simple as a burned-out headlight, but the majority of improper equipment charges actually stem from speeding tickets.
Drivers trying to avoid the higher insurance rates that follow a speeding ticket routinely strike a deal with the court to reduce the speeding ticket so it won’t go on their driving record, in exchange pleading to a charge of improper equipment.
The state legislature tacked a new fine of $50 onto improper equipment charges in 2011 and funneled the proceeds into a state penal fund to foot the bill for housing misdemeanor inmates in county jails instead of state prisons. The state hoped to save money by packing low-level inmates off to county jails and paying the counties to house them using revenue from the newly invented fine.
“They were trying to pay for the justice system using funds that were supposed to go to the school system,” Smathers said.
The case is expected to be a slam dunk, thanks to a trailblazing lawsuit by the school system in Richmond County dating back to 2012.
“When the General Assembly passed the legislation, everyone kind of opined that it was probably unconstitutional,” said Chad Donnahoo, attorney with the Campbell Shatley law firm in Asheville. “Richmond County took the ball and ran with it.”
The state fought Richmond County’s case, claiming the fine for improper equipment violations wasn’t really a fine. The state called it a “surcharge.”
But the N.C. Court of Appeals saw through the semantics and ruled against the state in September.
“The court said it is actually a fine and all the school boards across the state are now joining in,” Smathers said.
Richmond County Schools arguably had a lot at stake. Over the past four years, the improper equipment fine there has amounted to $1.3 million, which the state was ordered to repay.
The state was apparently bracing for this outcome. State lawmakers have already made changes to the disbursement of the improper equipment fine and are now giving it to school systems as the constitution calls for. The state likewise made necessary adjustments in the state budget to pay for housing inmates in county jails.
But in order to recoup back fines, each county must go through the process of signing on to a lawsuit.
“It should be a very simple and uncomplicated matter,” Donnahoo said.
More than 30 school districts across the mountains — including Haywood, Jackson, Macon and Swain — are joining forces under a single lawsuit against the state being handled by the Asheville-based firm Campbell Shatley.
A similar suit has been filed on behalf of about 40 school districts in the eastern part of the state by the Raleigh-based firm Tharrington Smith.
The amount each school system stands to gain varies based on the number of improper equipment charges dished out in that locale.
“Some counties that have interstates and major highways running through them have a lot more,” Donnahoo said.
It also depends whether the prosecutors and judges in a particular county routinely used improper equipment as a plea tool in reducing speeding tickets.
