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| [1] | COURT OF APPEAL, FOURTH DISTRICT DIVISION TWO STATE OF CALIFORNIA |
| [2] | No. E026060 |
| [3] | 2000.CA.0042749 <http://www.versuslaw.com> |
| [4] | September 27, 2000 |
| [5] | As modified October 11, 2000. There is no change in judgment. Appellant's
petition for rehearing is denied. |
| [6] | NORMA KIRCHMANN, PLAINTIFF AND APPELLANT, V. LAKE ELSINORE UNIFIED SCHOOL DISTRICT ET AL., DEFENDANTS AND RESPONDENTS. |
| [7] | (Super.Ct.No. 314830) |
| [8] | Donal M. Hill for Plaintiff and Appellant. Walsh & Declues, Jeffrey
P. Thompson and Gregory A. Wille for Defendant and Respondent Lake Elsinore
Unified School District. No appearance for Defendants and Respondents Keith
McCarthy, Normand Tanguay, David Long, Jeanie Corral, Richard Jenkins, Vick
Knight, Jeannine Martineau, and Sonja Wilson. |
| [9] | The opinion of the court was delivered by: Richli, Acting P.J. |
| [10] | CERTIFIED FOR PUBLICATION |
| [11] | OPINION |
| [12] | APPEAL from the Superior Court of Riverside County. Victor Miceli, Judge. |
| [13] | Affirmed. |
| [14] | The issue in this case is whether the Lake Elsinore Unified School District
(District) is immune from suit under Title 42 United States Code section
1983 (hereafter, section 1983) as an instrumentality of the State of California.
As we will discuss, public education in California is "uniquely a fundamental
concern of the State" (Butt v. State of California (1992) 4 Cal.4th
668, 685), and "[t]he Constitution has always vested `plenary' power
over education not in the districts, but in the State . . . ." (Id.,
at p. 688.) Therefore, in accordance with authority of the Ninth Circuit
Court of Appeals holding that a California school district is an arm of
the state for Eleventh Amendment purposes (Belanger v. Madera Unified School
Dist. (9th Cir. 1992) 963 F.2d 248, 254), we will conclude the District
does enjoy the state's immunity from liability under section 1983. |
| [15] | I. FACTUAL AND PROCEDURAL BACKGROUND |
| [16] | The facts are set forth in detail in this court's previous decision in
this case, Kirchmann v. Lake Elsinore Unified School Dist. (1997) 57 Cal.App.4th
595. Norma Kirchmann, an employee of the District, was suspended for 30
days after she anonymously communicated to bidders on a District construction
management contract her view that a conflict of interest existed in the
selection process. Kirchmann petitioned for a writ of mandate to overturn
the suspension. This court concluded Kirchmann's communication was protected
by the First Amendment, and the suspension therefore was improper. (Id.,
at p. 614.) |
| [17] | Kirchmann then sued the District under section 1983. The District demurred,
arguing it was an arm of the state and therefore immune from suit under
section 1983. The court sustained the demurrer, and Kirchmann appealed. |
| [18] | II. DISCUSSION |
| [19] | A. The Belanger Decision |
| [20] | Section 1983 provides, in relevant part, that "[e]very person who
. . . subjects, or causes to be subjected, any citizen of the United States
. . . to the deprivation of any rights, privileges, or immunities secured
by the Constitution and laws, shall be liable to the party injured in an
action at law, suit in equity, or other proper proceeding for redress .
. . ." Local governmental bodies such as cities and counties are considered
"persons" subject to suit under section 1983. (Monell v. New York
City Dept. of Social Services (1978) 436 U.S. 658, 690-691 [98 S.Ct. 2018,
2035-2036, 56 L.Ed.2d 611].) States and their instrumentalities, on the
other hand, are not. (Will v. Michigan Dept. of State Police (1989) 491
U.S. 58, [109 S.Ct. 2304, 2311, 105 L.Ed.2d 45].) |
| [21] | To our knowledge, no previous decision has considered the precise question
here, whether a California school district should be considered a local
governmental body subject to suit under section 1983, or an instrumentality
of the state exempt from suit. *fn1
In Belanger v. Madera Unified School Dist., supra, 963 F.2d 248 (hereafter,
Belanger), however, the Ninth Circuit Court of Appeals considered a closely
related question -- whether a California school district was an arm of the
state for purposes of the Eleventh Amendment. |
| [22] | The Eleventh Amendment prohibits federal courts from hearing "any
suit in law or equity, commenced or prosecuted against one of the United
States . . . ." The prohibition "encompasses not only actions
in which a State is actually named as the defendant, but also certain actions
against state agents and state instrumentalities." (Regents of the
University of California v. Doe (1997) 519 U.S. 425, 429 [117 S.Ct. 900,
903, 137 L.Ed.2d 55].) The Belanger court concluded the school district
was an arm of the state, *fn2
and therefore enjoyed Eleventh Amendment immunity. The court noted that,
unlike school districts in most states, California districts were funded
primarily by the state. This was attributable to two factors -- first, the
need to ensure equality of funding as required by Serrano v. Priest (1976)
18 Cal.3d 728, and second, the limitations on local property tax revenues
imposed by Proposition 13. Therefore, a judgment against the school district
would be paid using state funds. (Belanger, supra, 963 F.2d at pp. 251-252.) |
| [23] | In addition, the Belanger court noted, public education was a matter of
statewide concern in California. The state exercised substantial control
over school affairs and maintained beneficial ownership of school district
property. The California Supreme Court had described school districts as
"`agencies of the state for the local operation of the state school
system.'" (Belanger, supra, 963 F.2d at p. 254, quoting Hall v. City
of Taft (1956) 47 Cal.2d 177, 179.) |
| [24] | Other Ninth Circuit decisions, and decisions of federal district courts
in the Ninth Circuit, similarly have extended Eleventh Amendment immunity
to a California county office of education (Eaglesmith v. Ward (9th Cir.
1995) 73 F.3d 857, 860); to California community college districts (Mitchell
v. Los Angeles Community College Dist. (9th Cir. 1988) 861 F.2d 198, 201;
Cerrato v. San Francisco Community College Dist. (9th Cir. 1994) 26 F.3d
968, 972; Wasson v. Sonoma County Jr. College Dist. (N.D.Cal. 1997) 4 F.Supp.2d
893, 901-902; Stones v. Los Angeles Community College Dist. (C.D.Cal. 1983)
572 F.Supp. 1072, 1076-1078), and, under Belanger, to a city school district.
(Doe v. Petaluma City School Dist. (N.D.Cal. 1993) 830 F.Supp. 1560, 1577.)
At least one California court also has relied on Belanger for the proposition
that a school district enjoys Eleventh Amendment immunity. (Cutler-Orosi
Unified School Dist. v. Tulare County School etc. Authority (1994) 31 Cal.App.4th
617, 633.) |
| [25] | The District contends that, since under Belanger a school district is
an arm of the state for Eleventh Amendment purposes, it is an instrumentality
of the state for purposes of section 1983 and hence immune from suit under
that statute. Kirchmann challenges this conclusion on two grounds. First,
she argues the fact an entity may be entitled to Eleventh Amendment immunity
does not necessarily mean it is immune from suit under section 1983. Second,
she argues that, even if the Eleventh Amendment immunity analysis is applicable
in determining immunity from suit under section 1983, Belanger was incorrect
in concluding a California school district enjoys Eleventh Amendment protection. |
| [26] | B. Applicability of Eleventh Amendment Analysis |
| [27] | Kirchmann's first argument is relatively easy to answer. She contends
that, because the Eleventh Amendment only prohibits suit against a state
in federal court, Eleventh Amendment analysis does not control whether an
entity can be sued in state court, even on a federal cause of action such
as a section 1983 claim. |
| [28] | The fact that a claim against a state or its agency cannot be brought
in federal court due to the Eleventh Amendment does not, of course, necessarily
mean the claim cannot be asserted in state court either. Tort actions may
be brought against the state or its agencies in state court under the California
Tort Claims Act (Gov. Code, § 810 et seq.) but may not be brought in federal
court, because the consent to suit contained in the act (Gov. Code, § 945)
is not a waiver of Eleventh Amendment immunity. (BV Engineering v. Univ.
of Cal., Los Angeles (9th Cir. 1988) 858 F.2d 1394, 1396; Riggle v. State
of Cal. (9th Cir. 1978) 577 F.2d 579, 585-586.) |
| [29] | However, the analysis of the United States Supreme Court in Will v. Michigan
Dept. of State Police, supra, 491 U.S. 58 (hereafter, Will), and subsequent
decisions construing Will, make clear that, if an entity enjoys Eleventh
Amendment immunity, it is also immune from suit under section 1983, even
in state court. The court in Will did state that the scope of the Eleventh
Amendment and the scope of section 1983 were "[c]ertainly" separate
issues. (Will, supra, at p. 66.) But in holding states immune from section
1983 suits, the court noted that section 1983 was enacted in response to
the inability or unwillingness of state authorities to protect civil rights.
Therefore, although Congress did not establish federal courts as the exclusive
forum for section 1983 suits, it plainly intended federal courts to have
"`a paramount role'" in enforcing the statute. (Will, supra, at
p. 66.) |
| [30] | In light of that fact, the Will court concluded the fact that Congress
did not override states' Eleventh Amendment immunity against suit in federal
court under section 1983 indicated it also did not intend states to be subject
to suit in state court under section 1983: "Given that a principal
purpose behind the enactment of § 1983 was to provide a federal forum of
civil rights claims, and that Congress did not provide such a federal forum
for civil rights claims against States, we cannot accept petitioner's argument
that Congress intended nevertheless to create a cause of action against
States to be brought in state courts, which are precisely the courts Congress
sought to allow civil rights claimants to avoid through § 1983." (Will,
supra, 491 U.S. at p. 66.) |
| [31] | From this reasoning it follows that, if an entity is not subject to suit
under section 1983 in federal court because of the Eleventh Amendment, Congress
presumably did not intend that it be subject to suit under section 1983
in state court either. Accordingly, numerous courts have concluded that,
under Will, "states and `governmental entities that are considered
"arms of the State" for Eleventh Amendment purposes' are not `persons'
subject to liability under section 1983 in any forum." (Lynch v. San
Francisco Housing Authority, supra, 55 Cal.App.4th 527, 532, italics added;
see also Thompson v. City of Los Angeles (9th Cir. 1989) 885 F.2d 1439,
1443 [because University of California "is an arm of the state under
the Eleventh Amendment, it follows from Will that UC is not a `person' within
the meaning of § 1983"]; Simon v. State Compensation Ins. Authority
(Colo. 1997) 946 P.2d 1298, 1302 ["[U]nder Will, an Eleventh Amendment
arm-of-the-state analysis must be applied to determine whether a state-created
entity is a `person' under § 1983"] and decisions cited at p. 1302,
fn. 5; Brooks v. Center for Healthcare Services (Tex. App. 1998) 981 S.W.2d
279, 284 [Under Will, "states and entities that may be characterized
as arms of the state for purposes of the Eleventh Amendment may not be held
liable under § 1983"]; Board of Trustees Hamilton v. Landry (Ind.App.
1994) 638 N.E.2d 1261, 1263 [Indiana school corporation was not arm of state
entitled to Eleventh Amendment immunity, and therefore was a "`person'
amenable to suit under Section 1983"].) The United States Supreme Court
similarly has stated, albeit in dictum, that under Will "an entity
with Eleventh Amendment immunity is not a `person' within the meaning of
§ 1983." (Howlett by and through Howlett v. Rose (1990) 496 U.S. 356,
365, 381, fn. 24 [110 S.Ct. 2430, 2437, 2445, fn. 24] [declining to decide
whether Florida school district is a "person" under section 1983].) |
| [32] | Kirchmann argues this analysis should not apply in California, because
by enacting the Tort Claims Act the state has waived sovereign immunity
against any and all statutory claims in state court actions, even if the
Eleventh Amendment would not permit such a claim to be brought in federal
court. She points to Government Code sections 815, which provides that a
public entity is not liable for an injury "[e]xcept as otherwise provided
by statute," and 811.2, which defines "statute" to include
an act of Congress such as section 1983. |
| [33] | Kirchmann overlooks the fact that whether an etity is a "person"
subject to suit under section 1983 is a matter of federal law and is not
affected by whether the entity has sovereign immunity under state law. The
United States Supreme Court said in Howlett by and through Howlett v. Rose,
supra, 496 U.S. 356 [110 S.Ct. 2430, 110 L.Ed.2d 332]: "The elements
of, and the defenses to, a federal cause of action are defined by federal
law. [Citations.] A State may not, by statute or common law, create a cause
of action under § 1983 against an entity whom Congress has not subjected
to liability. [Citation.] Since this Court has construed the word `person'
in § 1983 to exclude States, neither a federal court nor a state court may
entertain a § 1983 action against such a defendant." (496 U.S. at pp.
375-376, italics added.) |
| [34] | Thus, California cannot, by enacting the Tort Claims Act, make school
districts liable under section 1983 if they are not "persons"
subject to section 1983 liability under federal law. As Will and its progeny
demonstrate, the answer to that question depends on whether an entity is
an arm of the state for Eleventh Amendment purposes. |
| [35] | We therefore apply an Eleventh Amendment analysis in deciding whether
the District is subject to suit under section 1983. |
| [36] | C. Whether the District is an Arm of the State |
| [37] | Kirchmann's second contention -- that Belanger was incorrect in holding
a California school district to be an arm of the state for Eleventh Amendment
purposes -- requires more extensive discussion. |
| [38] | 1. Applicable law |
| [39] | "[T]he question whether a particular state agency has the same kind
of independent status as a county or is instead an arm of the State, and
therefore `one of the United States' within the meaning of the Eleventh
Amendment, is a question of federal law." (Regents of the University
of California v. Doe, supra, 519 U.S. 425, 429, fn. 5 (hereafter, Doe).)
Even on matters of federal law, of course, this court is not bound by lower
federal court authority. (Forsyth v. Jones (1997) 57 Cal.App.4th 776, 782-783.)
Belanger therefore does not necessarily control the present case. Instead,
we must make an independent determination of federal law. (Forsyth v. Jones,
supra, at pp. 782-783.) |
| [40] | Moreover, whether a state agency enjoys Eleventh Amendment immunity "can
be answered only after considering the provisions of state law that define
the agency's character." (Doe, supra, 519 U.S. 425, 429, fn. 5.) Therefore,
we also must consider state law in our analysis. |
| [41] | 2. Relevant criteria |
| [42] | "A uniform test for defining the class of entities that share in
the state's Eleventh Amendment immunity has not yet developed." (Lynch
v. San Francisco Housing Authority, supra, 55 Cal.App.4th 527, 533.) In
general, however, the court must examine "the relationship between
the State and the entity in question." (Doe, supra, 519 U.S. 425, 429.) |
| [43] | Mt. Healthy City School Dist. Board of Education v. Doyle, supra, 429
U.S. 274 (hereafter, Mt. Healthy) is particularly relevant here because
it involved a local school board. In Mt. Healthy, the court held an Ohio
city school board did not enjoy Eleventh Amendment immunity, because the
board was "more like a county or city than . . . like an arm of the
State." (Id., at p. 280.) It noted that under state law school districts
were "political subdivisions," and the "State" did not
include "political subdivisions." Furthermore, although the school
board was subject to "some" guidance from the State Board of Education
and received "a significant amount of money" from the state, it
also had extensive powers to issue bonds and to levy taxes within certain
restrictions. (Id., at p. 280.) |
| [44] | Recently, the court in Lynch v. San Francisco Housing Authority, supra,
55 Cal.App.4th 527 set forth the criteria that federal decisions have found
to be relevant in determining whether a state entity should have Eleventh
Amendment immunity: whether a money judgment against the entity would be
satisfied out of state funds; the degree of funding the entity receives
from the state; whether the entity has independent authority to raise funds;
the extent of state control over the entity's fiscal affairs; whether the
entity performs central governmental functions; whether the entity may sue,
be sued, and hold property in its own name; the corporate status of the
entity under state law; the degree of autonomy enjoyed by the entity; the
entity's immunity from state taxation; and the geographic scope of the entity's
operation. (Id., at pp. 533-534.) |
| [45] | We believe the criteria identified in Lynch usefully can be grouped into
two broad categories. The first category, comprising the first four criteria,
concerns the degree of state involvement in the entity's fiscal affairs.
The second category, comprising the remaining six criteria, concerns the
political status which state law affords the entity. We will organize our
analysis around these two categories. |
| [46] | 3. Analysis |
| [47] | We begin by noting that most courts after Mt. Healthy have declined to
extend Eleventh Amendment immunity to local school districts and boards.
In 1990, the United States Supreme Court, citing Mt. Healthy but without
further analysis, said: "[T]he Eleventh Amendment . . . does not afford
local school boards . . . immunity from suit . . . ." (Missouri v.
Jenkins (1990) 495 U.S. 33, 56, fn. 20 [110 S.Ct. 1651, 1665, fn. 20, 109
L.Ed.2d 31].) Lower federal courts, and state courts, have reached the same
conclusion. *fn3 |
| [48] | These decisions, of course, are of limited assistance here, since they
all involved school authorities in states other than California. Nonetheless,
we will consider the discussion in these decisions to the extent it is relevant
in determining whether Belanger correctly reached the opposite conclusion
with respect to California school districts. |
| [49] | a. Fiscal affairs |
| [50] | Of the criteria included in our first broad category -- the degree to
which the state is involved in an entity's fiscal affairs -- the one most
often emphasized is the impact that a judgment against the entity would
have on the state treasury. The Supreme Court in Hess v. Port Authority
Trans-Hudson Corp. (1994) 513 U.S. 30 [115 S.Ct. 394, 130 L.Ed.2d 245] (hereafter,
Hess) noted, " . . . Courts of Appeals have recognized the vulnerability
of the State's purse as the most salient factor in Eleventh Amendment determinations."
(Id., at p. 48.) The court later noted that the "prevailing view"
was that "`whether any judgment must be satisfied out of the state
treasury'" was "`the most important consideration' in resolving
an Eleventh Amendment immunity issue." (Id., at p. 51.) The court based
its emphasis on the state treasury factor on the fact that the "impetus
for the Eleventh Amendment" was "the prevention of federal-court
judgments that must be paid out of a State's treasury." (Id., at p.
48.) The court stopped short of saying the state treasury factor was conclusive,
but noted that the briefs filed by the states involved in the case before
it stated the vast majority of federal circuits had generally accorded the
factor "`dispositive weight.'" (Id., at p. 49.) |
| [51] | In Regents of the University of California v. Doe, the Supreme Court held
that the University of California enjoyed Eleventh Amendment immunity against
a breach of contract action even though the federal government had agreed
to pay any judgment arising from the action. (Doe, supra, 519 U.S. at pp.
430-431.) The court said that, in determining immunity, the relevant factor
is "a State's legal liability for judgments against a state agency,"
not the "formalistic question of ultimate financial liability."
(Id., at pp. 430-431, italics added.) |
| [52] | Hess and Doe could be read to mean that, if a state would not be legally
obligated to pay from its treasury a judgment against an entity, the entity
is not an arm of the state for Eleventh Amendment purposes, regardless of
the degree to which the state is involved in the entity's financial or other
affairs. (See, e.g., Duke v. Grady Mun. Schools, supra, 127 F.3d 972, 981
[no immunity where state not legally liable for judgment against school
district, even though district received 98 percent of its funds from state];
San Antonio Independent School Dist. v. McKinney, supra, 936 S.W.2d 279,
284 [no immunity where judgment against a school district would be paid
"from the funds of the school district, whether generated locally or
appropriated by the State, not from the state treasury"].) In that
event, Belanger's conclusion that California school districts are arms of
the state because they are principally state funded would be questionable,
unless it were also shown that the state treasury would be directly vulnerable
to a judgment in the particular case. |
| [53] | As a general matter of California law, the state does not have respondeat
superior liability for the acts of a school district. (Johnson v. San Diego
Unified School Dist. (1990) 217 Cal.App.3d 692, 698-700.) In addition, Government
Code section 970, which governs payment of judgments against public entities,
distinguishes between "the state or any . . . agency of the state claims
against which are paid by warrants drawn by the Controller" and a "local
public entity." (Id., subd. (c).) Although the definition of "local
public entity" in section 970, subdivision (c), does not expressly
include a school district, the California Law Revision Commission Comment
to section 970 states that enactment of the section "permits the repeal
of a number of special statutes applying to particular types of local public
entities: [former] Educ. Code §§ 35201 (duty of school district to pay `any
judgment for debts, liabilities, or damages') . . . ." (Cal. Law Revision
Com. com., 1980 amend., 32A pt. 1 West's Ann. Gov. Code (1995 ed.) foll.
§ 970, p. 110, italics added.) Thus it appears that, for purposes of paying
judgments, a school district is not considered an agency whose liabilities
"are paid by warrants drawn by the Controller." |
| [54] | However, we decline to read Hess and Doe to preclude immunity based on
this single factor. Hess is unusual in that it involved an entity created
by two states with the consent of Congress. The court noted that, because
the federal government was involved, subjecting the entity to suit in federal
court did not present the Eleventh Amendment problems that might exist with
respect to a wholly state-created entity. (Hess, supra, 513 U.S. 30, 41.)
In fact, the court was required to presume the bistate entity did not qualify
for immunity, unless it was shown that the states and Congress intended
it to be immune. (Id., at pp. 43-44.) No such presumption exists with respect
to single state entities such as school districts. |
| [55] | Further, as noted, the court in Hess stopped short of saying the state's
legal liability was dispositive. To the contrary, the court stated the test
for immunity as follows: "If the expenditures of the enterprise exceed
receipts, is the State in fact obligated to pay the resulting indebtedness
of the enterprise? When the answer is `No' - both legally and practically
-- then the Eleventh Amendment's core concern is not implicated." (Hess,
supra, 513 U.S. at p. 51, italics added.) Similarly, the court said in a
previous decision that the purpose of Eleventh Amendment immunity was to
"protect the state treasury from liability that would have had essentially
the same practical consequences as a judgment against the State itself."
(Lake Country Estates, Inc. v. Tahoe Reg. Plan. (1979) 440 U.S. 391, 401
[99 S.Ct. 1171, 1177, 59 L.Ed.2d 40], fn. omitted, italics added.) |
| [56] | The italicized language suggests that whether the state is legally liable
for a judgment against an entity is only one factor. The court also must
consider whether the state is "practically" liable, as would arguably
be the case where the state provides the entity's funding and therefore
would indirectly end up paying a judgment against it. (See, e.g., Hadley
v. North Arkansas Community Technical College, supra, 76 F.3d 1437, 1439-1441
[community college was arm of state where, even if college could initially
pay judgment from other sources, state would ultimately make up budget shortfall].) |
| [57] | The court in Doe also did not say legal liability was the only relevant
question. To the contrary, it appeared to endorse a flexible approach under
which a variety of factors would be considered. The court noted that in
past cases it had "sometimes examined `the essential nature and effect
of the proceeding' . . . and sometimes focused on the `nature of the entity
created by state law' to determine whether it should `be treated as an arm
of the State' . . . ." (Doe, supra, 519 U.S. at pp. 429-430, fn. omitted.)
The Doe court did say that "[w]hether a money judgment against a state
instrumentality or official would be enforceable against the State is of
considerable importance to any evaluation of the relationship between the
State and the entity or individual being sued." (Id., at p. 430, italics
added.) Again, however, the italicized language suggests that although the
liability factor is important, it is only one factor in considering "the
relationship between the State and the entity . . . ." |
| [58] | Additionally, the only question in Doe, which the court described as a
"narrow" one, was whether the university's ability to seek indemnification
from the federal government vitiated its Eleventh Amendment immunity. The
court expressly declined to re-examine the Ninth Circuit authority holding
the university was an arm of the state. (Doe, supra, 519 U.S. at p. 432.)
Doe thus stands merely for the proposition that the fact state funds are
not actually used to pay a judgment for which the state is legally liable
does not preclude immunity. It does not follow that the converse is also
true, i.e., that if an entity uses funds provided by the state to pay a
judgment for which the state is not legally liable, there can be no immunity. |
| [59] | Finally, neither Hess nor Doe gave any indication of disagreement with
the immunity analysis employed in Mt. Healthy. In fact, both decisions cited
Mt. Healthy. (Hess, supra, 513 U.S. at p. 47; Doe, supra, 519 U.S. at p.
430.) Yet the court in Mt. Healthy -- the authority most relevant here since
it involved a school board -- appears not to have considered the legal liability
of the state at all. (Mt. Healthy, supra, 429 U.S. 274, 280-281.) Instead,
the court examined "the nature of the entity created by state law,"
the extent of state guidance and funding, and the entity's independent ability
to raise funds. (Id., at p. 280.) |
| [60] | Subsequent decisions have declined to interpret Hess and Doe as reducing
the Eleventh Amendment inquiry to a question of the state's legal liability
for a judgment against the entity. In Gray v. Laws (4th Cir. 1995) 51 F.3d
426, the Fourth Circuit noted that, in fact, Hess identified other factors
as also relevant, such as the state's characterization of the entity, the
entity's functions, and the extent of state control. (Id., at pp. 432-433.)
The Gray court concluded the correct approach under Hess was that, if the
state treasury would be liable for a judgment, that fact was "largely,
if not wholly, dispositive," and the entity would be entitled to immunity.
(Gray, supra, at p. 433.) If, on the other hand, the state's treasury would
not be affected by a judgment, then the court should consider the other
relevant factors, including "whether the state possesses such control
over the entity . . . that it can legitimately be considered an `arm of
the state.'" (Id., at p. 434.) |
| [61] | The court in Simon v. State Compensation Insurance Authority, supra, 946
P.2d 1298 similarly concluded that under Hess and Doe "the judgment
liability factor alone does not resolve whether an entity is entitled to
Eleventh Amendment immunity." (Simon, supra, at p. 1306.) The court
noted that both Hess and Doe considered other factors as well and that neither
rejected the multifactor "balancing" test employed in Mt. Healthy
despite having the opportunity to do so. Therefore, it concluded the balancing
test remained in effect. (Simon, supra, at p. 1307.) |
| [62] | Employing that analysis here, we find a number of factors that favor immunity. |
| [63] | The California Constitution obligates the state Legislature to "provide
for a system of common schools . . . ." (Cal. Const., art. IX, § 5.)
As the Belanger court noted, school districts receive their funding primarily
from the state. |
| [64] | The Education Code provides that the state Controller during each fiscal
year shall transfer from the General Fund of the state to the State School
Fund a specified amount per pupil. (Educ. Code, § 14002.) The state Superintendent
of Public Education is required to certify to the Controller the amounts
estimated to be apportioned to each school during the ensuing fiscal year.
(Educ. Code, § 41330.) As the California Supreme Court has recognized, "since
the adoption in June 1978 of Proposition 13, limiting local taxation of
real property (Cal. Const., art. XIII A), school districts have become more
dependent on appropriations by the Legislature for a major part of their
revenue." (Cumero v. Public Employment Relations Bd. (1989) 49 Cal.3d
575, 592, fn. omitted.) |
| [65] | Further, although funds received by school districts are to be paid into
the county treasury for the credit of the district (Educ. Code, §§ 41001,
41002), numerous courts have stated that "`[s]chool moneys belong to
the state and the apportionment of funds to a school district does not give
the district a proprietary interest in the funds. . . .'" (Laidlaw
Waste Systems, Inc. v. Bay Cities Services, Inc. (1996) 43 Cal.App.4th 630,
635, italics added; accord, Hayes v. Commission on State Mandates (1992)
11 Cal.App.4th 1564, 1578, fn. 5; California Teachers Assn. v. Hayes (1992)
5 Cal.App.4th 1513, 1525.) Because school district funds are considered
funds of the state, payment of a judgment from such funds would have "essentially
the same practical consequences as a judgment against the State itself."
(Lake Country Estates, Inc. v. Tahoe Regional Planning Agency, supra, 440
U.S. 391, 401.) |
| [66] | School districts are authorized to raise their own revenues by issuing
and selling bonds, with the approval of the electors of the district. However,
state law specifies the purposes for which the proceeds may be used. (Educ.
Code, § 15100.) In addition, the state constitution requires that general
obligation bond proposals of school districts be approved by a two-thirds
vote. (Cal. Const., art. XVI, § 18.) Similarly, while school districts are
authorized to impose development charges to finance school construction,
the state Legislature has declared that such financing measures are "matter[s]
of statewide concern" and for that reason has "occupie[d] the
subject matter . . . to the exclusion of all local measures" on the
subject. (Gov. Code, § 65995, subd. (e); see also Grupe Development Co.
v. Superior Court (1993) 4 Cal.4th 911, 918.) |
| [67] | Finally, although in general the state is not legally responsible for
the obligations of a school district, the California Supreme Court has ruled
that in some instances the state has a constitutional duty to assume responsibility
for the operations of a school district, including its fiscal affairs. In
Butt v. State of California, supra, 4 Cal.4th 668, a school district lacked
funds to complete the final six weeks of its school term. The Supreme Court
affirmed an injunction authorizing the state Superintendent of Public Instruction
to displace the school board, operate the district through his own administrator,
and impose a plan for the district's permanent financial recovery. (Id.,
at pp. 694, 696, 704.) |
| [68] | The court in Butt explained that the California Constitution "makes
public education uniquely a fundamental concern of the State . . . ."
(Butt v. State of California, supra, 4 Cal.4th at p. 685.) It rejected the
state's contention that school districts would "feel free to overspend
if encouraged to believe in the availability of State relief." (Id.,
at p. 690.) The court further noted that the state itself had endorsed a
policy of emergency conditional loan assistance to districts in financial
difficulty. (Id., at p. 690; see Educ. Code, § 41320.2.) |
| [69] | California statutes and case law thus demonstrate the state's extensive
responsibility for and involvement in the fiscal affairs of school districts.
On balance, the criteria included in this category of factors favor treating
a school district as an arm of the state. |
| [70] | b. Political status |
| [71] | As identified by the court in Lynch v. San Francisco Housing Authority,
supra, 55 Cal.App.4th 527, the relevant factors in assessing the political
status afforded a government entity by the state include whether the entity
performs central governmental functions; whether the entity may sue, be
sued, and hold property in its own name; the corporate status of the entity
under state law; the degree of autonomy enjoyed by the entity; the entity's
immunity from state taxation; and the geographic scope of the entity's operation.
(Id., at pp. 533-534.) |
| [72] | There can be little dispute that the function performed by school districts,
the education of the public, is a matter of central governmental concern.
In Butt v. State of California, supra, 4 Cal.4th 668, the California Supreme
Court stated: "Public education is an obligation which the State assumed
by the adoption of the Constitution. . . . `[M]anagement and control of
the public schools [is] a matter of state[, not local,] care and supervision.
. . . ' . . . Local districts are the State's agents for local operation
of the common school system . . . ." (Id., at pp. 680-681.) The court
further observed that "[t]he Constitution has always vested `plenary'
power over education not in the districts, but in the State, through its
Legislature, which may create, dissolve, combine, modify, and regulate local
districts at pleasure." (Id., at p. 688.) |
| [73] | As examples of state regulation of school affairs, the court in Butt cited
Education Code sections addressing "such matters as county and district
organization, elections, and governance; educational programs, instructional
materials, and proficiency testing; sex discrimination and affirmative action;
admission standards; compulsory attendance; school facilities; rights and
responsibilities of students and parents; holidays; school health, safety,
and nutrition; teacher credentialing and certification; rights and duties
of public school employees; and the pension system for public school teachers."
(Butt v. State of California, supra, 4 Cal.4th 668, 689, citations omitted.) |
| [74] | We recognize that other statutory and constitutional provisions sometimes
treat school districts in the same manner as governmental entities which
do not enjoy Eleventh Amendment immunity, such as cities and counties, for
certain purposes. (See, e.g., Cal. Const., art. XIIIB, § 8; Gov. Code, §§
54240, 54951, 82041 [defining school district as "local" government
agency]; but see Gov. Code, § 17561 [referring separately to "local
agency" and "school district" for purposes of reimbursement
for state-mandated costs].) However, "[l]abeling an entity as a `state
agency' in one context does not compel treatment of that entity as a `state
agency' in all contexts." (Lynch v. San Francisco Housing Authority,
supra, 55 Cal.App.4th 527, 534; see also Doe, supra, 519 U.S. 425, 427,
fn. 2 [declining to decide "whether there may be some state instrumentalities
that qualify as `arms of the State' for some purposes but not others"].)
Conversely, it should follow that labeling an entity as a local agency for
some purposes also should not compel treatment of it as such for all purposes.
For this reason, authority distinguishing between the state and school districts
in non-Eleventh Amendment contexts (e.g., North Orange County Community
College Dist. v. CM School Supply Co. (1998) 63 Cal.App.4th 362, 366; LeVine
v. Weis (1998) 68 Cal.App.4th 758, 766) is not controlling. |
| [75] | Moreover, California courts have observed that the state's pervasive involvement
in school affairs makes its relationship with school districts qualitatively
different from its relationship with entities such as cities and counties:
"A school district's relationship to the state is different from that
of local governmental entities such as cities, counties, and special districts.
. . . Local school districts are agencies of the state and have been described
as quasimunicipal corporations. [Citation.] They are not distinct and independent
bodies politic." (Hayes v. Commission on State Mandates, supra, 11
Cal.App.4th 1564, 1578-1579, fn. 5; accord, California Teachers Assn. v.
Hayes, supra, 5 Cal.App.4th 1513, 1524.) This distinction in California
law between school districts and cities and counties is especially significant
in view of the United States Supreme Court's repeated formulation of the
ultimate Eleventh Amendment question as whether an entity "is more
like a county or city than it is like an arm of the State" (Mt. Healthy,
supra, 429 U.S. 274, 280) and whether it "has the same kind of independent
status as a county or is instead an arm of the State . . . ." (Doe,
supra, 519 U.S. 425, 429, fn. 5.) |
| [76] | Similarly, while a California school district's governing board may hold
and convey property for the use and benefit of the district (Educ. Code,
§ 35162), the California Supreme Court has stated that "[t]he beneficial
ownership of property of the public schools is in the state. . . . `[T]he
beneficial owner of the fee [of public school property] is the state itself,
and . . . its agencies and mandatories - the various public and municipal
corporations in whom the title rests - are essentially nothing but trustees
of the state, holding the property and devoting it to the uses which the
state itself directs.'" (Hall v. City of Taft, supra, 47 Cal.2d 177,
181-182.) Consequently, a school district's ability to own property does
not indicate it is not an arm of the state. |
| [77] | The remaining criteria do not appear to militate strongly one way or the
other. School districts may sue and be sued independently of the state (Educ.
Code, § 35162), and they operate within specific geographical limits rather
than statewide. But this is also true of community college districts which,
as stated previously, have been found to be arms of the state. (Educ. Code,
§ 72000.) Conversely, although school districts have the same exemption
from property taxation as does the state, so do counties and cities, which
do not enjoy immunity. (Cal. Const., art. XIII, § 3; Rev. & Tax. Code,
§ 202.) |
| [78] | Again, on balance, the relevant criteria favor immunity. |
| [79] | III. CONCLUSION |
| [80] | In view of the extensive control of the state over the fiscal affairs
and political status of school districts, the Ninth Circuit in Belanger
correctly determined a California school district should be considered an
arm of the state for purposes of the Eleventh Amendment. Unlike the Ohio
school board involved in Mt. Healthy, California school districts are subject
to substantially more than "some" state funding and control; in
fact, as discussed, beneficial ownership of their funds and other property
resides in the state, and they are agencies of the state under state law.
Therefore, the District shared the state's immunity from suit under section
1983, and the trial court properly sustained the demurrer. |
| [81] | IV. DISPOSITION |
| [82] | The judgment is affirmed. The District shall recover costs on appeal. |
| [83] | CERTIFIED FOR PUBLICATION |
| [84] | We concur: |
| [85] | Ward J. |
| [86] | Gaut J. |
|
|
|
| Opinion Footnotes | |
|
|
|
| [87] | *fn1 At
least two reported California decisions have involved section 1983 claims
against a school district or board, but neither court discussed whether
a school district has immunity as a state instrumentality. (Thorning v.
Hollister School Dist. (1992) 11 Cal.App.4th 1598; McDaniel v. Board of
Education (1996) 44 Cal.App.4th 1618.) |
| [88] | *fn2 We
use the term "arm of the state" because that is the term typically
employed in federal decisions considering whether a state entity is entitled
to Eleventh Amendment immunity. (See, e.g., Regents of the University of
California v. Doe, supra, 519 U.S. 425, 429- 430 [117 S.Ct. 900, 904]; Mt.
Healthy City School Dist. Board of Education v. Doyle (1977) 429 U.S. 274,
280 [97 S.Ct. 568, 572, 50 L.Ed.2d 471].) The Belanger court used the terms
"state agency" and "agent of the state." (Belanger,
supra, 963 F.2d at pp. 250- 254.) It has been suggested that the terms "state
agency" and "arm of the state" may not be synonymous. (Lynch
v. San Francisco Housing Authority (1997) 55 Cal.App.4th 527, 535.) Because
Belanger employed the same Eleventh Amendment analysis as the decisions
which use the term "arm of the state," we do not consider the
difference in nomenclature to be significant. We agree with the court in
Lynch v. San Francisco Housing Authority, that "[i]t is the relationship
between the entity and the state, not the label attached to the entity,"
that determines whether the Eleventh Amendment applies. (55 Cal.App.4th
at p. 536.) |
| [89] | *fn3 (See,
e.g., Narin v. Lower Merion School Dist. (3d Cir. 2000) 206 F.3d 323, 331,
fn. 6 [Pennsylvania school district]; Duke v. Grady Mun. Schools (10th Cir.
1997) 127 F.3d 972, 981- 982 [New Mexico school district and board]; San
Antonio Independent School Dist. v. McKinney (Tex. 1996) 936 S.W.2d 279,
284 [Texas school district]; Doe v. Knox County Bd. of Educ. (E.D.Ky. 1996)
918 F.Supp. 181, 183 [Kentucky county board of education]; Green v. Clarendon
County School Dist. Three (D.S.C. 1996) 923 F.Supp. 829, 850 [South Carolina
school district]; Daddow v. Carlsbad Mun. School Dist. (N.Mex. 1995) 120
N.M. 97, 105- 106 [898 P.2d 1235, 1243- 1244] [New Mexico school board];
Board of Trustees Hamilton v. Landry, supra, 638 N.E.2d at p. 1266 [Indiana
school corporation]; Ambus v. Granite Bd. of Educ. (10th Cir. 1993) 995
F.2d 992, 997 [Utah school district]; Stewart v. Baldwin County Bd. of Educ.
(11th Cir. 1990) 908 F.2d 1499, 1511 [Alabama county board of education];
Rosa R. v. Connelly (2d Cir. 1989) 889 F.2d 435, 437- 438 [Connecticut school
board]; Fay v. South Colonie Cent. School Dist. (2d Cir. 1986) 802 F.2d
21, 27- 28 [New York school district]; Gary A. v. New Trier High School
Dist. (7th Cir. 1986) 796 F.2d 940, 945 [Illinois school district and board];
Minton v. St. Bernard Parish School Bd. (5th Cir. 1986) 803 F.2d 129, 131-
132 [Louisiana school board]; Stoddard v. School Dist. No. 1, Lincoln County,
Wyo. (10th Cir. 1979) 590 F.2d 829, 835 [Wyoming school district]; Unified
School Dist. No. 480 v. Epperson (10th Cir. 1978) 583 F.2d 1118, 1123 [Kansas
school district]; Campbell v. Gadsden County Dist. School Bd. (5th Cir.
1976) 534 F.2d 650, 655-656 [Florida school board]; Adams v. Rankin County
Bd. of Educ. (5th Cir. 1975) 524 F.2d 928, 929 [Mississippi county school
system]; but cf. Hadley v. North Arkansas Community Technical College (8th
Cir. 1996) 76 F.3d 1437, 1442 [community college was an arm of the state].) |
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