Court of Appeals upholds TJCA v. Cleveland Co.

The NC Court of Appeals issued a decision in a funding case by three charter schools (Thomas Jefferson Classical Academy, Lincoln Charter School, and Piedmont Community Charter School) against Cleveland County Schools. The decision upholds a trial court win for the charter schools and affirms arguments charter advocates have been making to the Legislature.

The case involves funding for 2009-10, which is the year before the Hackney Amendment defunding charter schools was passed. Cleveland County Schools had moved a laundry list of moneys to its Fund 8, claiming that these moneys were “restricted.” The charter TJCA - Kelly LIghtschools sued, claiming that the moneys were not restricted, and the case ultimately went to trial. After CCS appealed once and the case was sent back for further findings, the trial judge ruled that the following moneys were not restricted and should have been included in Fund 2 and shared:

• Tuition / Tuition & Fees
• Indirect Costs
• Medicaid Reimbursements
• E-Rate
• Juvenile Crime Prevention Council grants
• Dropout Prevention grants
• Workforce Investment Act grants
• Gear Up Grants
• Sales Tax Refunds
• Interest
• Rent
• Sales of cars from DUI seizures
• Investment income

The Court of Appeals issued a decision today (less than a month after the case was argued) upholding the trial court’s ruling as to each of these funds—and holding that they all had to be shared with the charter schools. The opinion addresses each category of funds (except those CCS did not contest) and affirms the arguments charter advocates have been making to the Legislature. The Court ruled that since these funds were used for CCS’s general K-12 program, they had to be shared on a per-pupil basis with charter schools.

This ruling highlights the need to repeal the Hackney Amendment, which undoes court victories like the one today. The Court of Appeals has gotten it right: Money available to children in district schools should follow them to public charter schools. It is time the Legislature makes sure local school systems follow that rule going forward.

Matthew F. Tilley
Robinson Bradshaw & Hinson, P.A.