Washoe County School District has filed a lawsuit against Washoe County, its board of commissioners and the county treasurer.
The suit filed Thursday is in response to a vote in February by the Washoe County Board of Commissioners to hold the school district responsible for paying nearly $20 million of a $57 million settlement with Incline Village property owners who were overtaxed by the county for several years in the early 2000s.
School board trustees and the district’s legal counsel, Neil Rombardo, have said the county does not have the legal authority to withhold tax revenue from WCSD to pay the settlement—something the county has been planning to start doing in July.
The school district received about $10 million in overpaid taxes from Incline Village property owners over the course of several years. District officials acknowledge this but say it was not WCSD’s mistake and that the district used the funds in an appropriate manner. WCSD’s chief financial officer and its budget director have both said paying that money back, plus another nearly $10 million in interest and legal fees racked up during the protracted litigation, would be a devastating blow for the district.
WCSD Board President Angie Taylor said Friday she thinks it’s unfair for the 62,000 students currently enrolled in Washoe County schools to be made to suffer for a mistake that was made before most of them were even born.
“$20 million is a huge amount of money when we know that we’re looking at having less revenue to work with for various reasons going forward, so it’s certainly worth fighting for,” Taylor said. “Think about the number of teachers we could hire with $20 million. Think about how many class sizes we can reduce with $20 million. Think about how many more textbooks we can buy with $20 million.”
The school district is facing staff shortages, and the need for new textbooks was made clear in January when the board voted to spend $5.6 million on new science textbooks for children in kindergarten through fifth grades. The textbooks being replaced were purchased in 2002, the year before the Incline Village lawsuit was initiated. They’re being paid for by a four-year bond.
County commissioners have said their vote on the matter was mandated by court decisions and have pointed to the fact that the school district has been aware since the Incline Village lawsuit was initiated more than 17 years ago that someday the overpaid taxes might need to be returned.
School board Vice President Andrew Caudill rebuked the commission during the March 31 meeting at which trustees voted unanimously to move forward with legal action against the county.
“They should be ashamed of themselves. I hope the public takes notes of every county commissioner that did that [and] what they are intending to do to our students,” he said.
WCSD’s legal team argues in the court documents that the “law is clear that the County must fund its settlement through the general fund of the County” and that the attempt to withhold money from the school district violates “the Nevada Constitution, and multiple other provisions of Nevada law that limit the authority of the County to withhold funding from the District and the State of Nevada and that require the sufficient funding of education.”
Also noted in the school district’s lawsuit is the fact that it was not party to the settlement agreement and was not allowed to intervene in the litigation.
