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Billings couple alleges system creates too much local burden

HELENA - A Billings couple is suing the state over how it funds Montana public schools, alleging the system violates the constitution by unfairly shifting the burden of K-12 education onto local taxpayers.

Conrad and Teresa Stroebe filed the lawsuit Friday in Helena District Court. The pair charges that the way Montana funds its schools unfairly forces school districts to levy varying local mill levies to make up for budget shortfalls. The Stroebes say that because differing mill levies are imposed in different school districts, taxpayers are funding public education on an inequitable basis.

"Those disparities are unconstitutional under three different sections of the (Montana) constitution," Conrad Stroebe said Tuesday.

The Stroebes argue the state is violating constitutional rights to equal protection, due process, uniform taxation and tax equalization. They are asking the state to stop forcing local districts to levy taxes to balance school budgets and to return to the taxpayers all taxes unlawfully collected.

Conrad Stroebe, a certified public accountant, local school board trustee and former president of the Montana School Boards Association, estimated the those taxes amount to up to $1 billion.

"The suit we filed is for the taxpayers and in the long run it's for the kids because unless there are equitable taxes the kids get cheated across the state," said Stroebe.

State attorneys, who will be defending the case, said it is similar to one filed earlier by the Stroebes that was later withdrawn. Still, the lawyers said they need to review the allegations and determine how they mesh with the 2001 Legislature's school funding actions.

Jeff Weldon, chief counsel to the superintendent of schools, called the lawsuit "a major piece of litigation."

"It essentially challenges the way taxpayers are taxed to support our local schools," said Weldon. "The consequences of this lawsuit are pretty significant. We know that."

Chris Tweeten, chief civil counsel to the attorney general, who will lead the defense of the case, said the state likely will take a similar position on the latest Stroebe complaint. Tweeten said the state tried to have the first lawsuit dismissed because it didn't agree with the allegation that imposing varying mill levies for schools is unconstitutional.

But, he added: "It's an interesting issue and if a taxpayer has concerns about this, it's probably something the courts ought to resolve."

Stroebe said he and his wife aren't addressing the inadequacy of school funding, but rather the fact that Montana taxpayers are picking up a growing share of the education costs. He said since 1993, when the state changed the way schools are funded, Montana's share of education funding has declined and as a result local taxpayers are paying the difference.

Stroebe said school funding should be similar to other statewide imposed taxes such as the gasoline tax, which is charged at the same level at any pump across the state. He said it's up to the state to figure out how to rectify the problem, but suggested the state could increase its share with income tax revenues or by increasing the statewide mill levy for education.

This is not the first time Montana's school funding system has been challenged.

In the mid-1980s, a number of large school districts and the Montana Education Association went to court over what they contended was an unconstitutional K-12 funding formula. They prevailed in district court and won a unanimous decision from the Montana Supreme Court in 1989. A special legislative session in the summer of 1989 came up with a new funding system, but it was revamped in 1993 into the state's current method of financing schools.

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