LAS VEGAS – The Nevada Supreme Court has ruled that the state's voucher-style Education Savings Accounts program — seen as the broadest school choice initiative in the country — has an unconstitutional funding mechanism that should remain blocked.
Justices issued a ruling on Thursday against the money source for the program — which has been on hold since the winter and never disbursed funds to families as it intended — but upholding some of the major tenets underlying the school voucher concept.
Parties on both sides of the hotly debated issue claimed victory, emphasizing different parts of the 35-page decision.
"The state was taken to its knees by a group of people that believe in public education," said Rory Reid, son of Democratic Sen. Harry Reid and president of the Rogers Foundation, which supported legal challenges against the program. "This is a tremendous victory."
Proponents framed the ruling as a "landmark win" for themselves, saying it affirmed some of their most fundamental arguments and adding that the program's defects can be fixed by the Legislature.
"After today's ruling, there is only one step left to take in order to make the vision of educational choice a reality for thousands of Nevada families," said Attorney General Adam Laxalt, a Republican who enlisted star lawyer Paul Clement to help him defend the program. "Fortunately, the Supreme Court has made crystal clear that ESAs are constitutional and that the Legislature can fix this funding technicality and allow for the implementation of ESAs statewide."
With Nevada lawmakers expected to meet in coming days to consider public financing for an NFL stadium in Las Vegas, Treasurer Dan Schwartz immediately requested that Gov. Brian Sandoval include the issue on the agenda. But the governor indicated he didn't want to rush the matter.
"There may be a path for a legislative solution," Sandoval said in a statement. "However, such a solution is complex and must be well thought-out to meet constitutional muster."
Nevada lawmakers passed a Republican-backed bill on a party-line vote last year to create the ESA program. It would allow parents to access more than $5,000 in funds allocated each year for their child's public schooling and apply it toward private school tuition or other qualified education expenses.
About 8,000 people have applied.
Thursday's ruling says the program did not have its own dedicated funding source and runs afoul of the Nevada Constitution by drawing from the same pool of money allocated for public schools in the state's Distributive School Account.
Opponents described the old model as a "slush fund" available to an unlimited number of applicants, from any income level. Future efforts to fund the voucher program would need to be more defined and approved separately, opening them up to another level of scrutiny.
Tod Story, executive director of the ACLU of Nevada, argued that taxpayers are unlikely to support future voucher programs because they would require either a tax increase or a deliberate cut from another part of the state budget.
But justices affirmed some central arguments from the proponents. The majority of the court agreed that money transferred to accounts controlled by parents is no longer defined as "public funds" that can't be used for "sectarian purposes;" two justices said in a dissent that the issue wasn't fully fleshed out, even though they agreed on the other points of the ruling.
One of the two lawsuits against the program argued primarily on the grounds of separation of church and state, saying the program would unconstitutionally divert money to religious schools that proselytize or can discriminate against students or staff.
The justices also affirmed that the Education Savings Account program doesn't violate the Legislature's duty to "provide for a uniform system of common schools."
Republican Assembly Majority Leader Paul Anderson, who's trying to keep his party in control of the Assembly during an election cycle that favors Democrats, said his candidates will use the issue to persuade voters to choose Republicans who are likely to support reviving the ESAs.
"It's disappointing that more legislators don't believe in school choice. It should not be a Republican-only issue," Anderson said. But the funding problem "is much easier to overcome than had they ruled differently on the other points."
Associated Press writer Ken Ritter contributed to this report.