Union Co. decries $91M ‘runaway verdict’ on school money, outlines appeal claims

Ten months after launching their appeal, Union County commissioners finally outlined the reasons they want an appeals court to toss out what they called a $91 million “runaway verdict” awarded to the school board.

The school board was unhappy with the amount of money the county had allocated it last year and sued. The two sides were about $8 million apart. Last October, a jury awarded the board the surprise sum after a two-month trial.

Lawyers for the commissioners recently filed a 113-page brief with the N.C. Court of Appeals that cited what they claimed were errors by trial Judge Erwin Spainhour.

Those claims included letting the school board argue an improper legal standard in its opening statement; allowing the board to present evidence of needs outside of its 2013-14 budget request; and instructing the jury to apply an overly broad definition of the amount of funds legally needed to maintain the public schools.

The N.C. Association of County Commissioners filed a supporting brief. The group warned that the verdict, if upheld, could devastate poor counties by forcing them to implement massive tax hikes or slash vital services because of the standard the case would set.

Meanwhile, the bills for legal fees and related expenses continue to grow for Union taxpayers and stand at nearly $1.8 million. That includes more than $1 million for the school board and $747,775 for the county.

Concern over the case led state lawmakers in mid-June to approve a bill imposing a two-year moratorium on school boards in Union, Gaston and Nash counties suing county commissioners over funding disputes.

Union County passed a budget this year with a 15.4 percent tax hike that commissioners said was needed to cover school district expenses. A much bigger tax increase, or a huge cut in services, will be needed if the county has to cover the entire $91 million verdict, county officials have said.

‘Political theater’

The judge in Union County improperly allowed the school board to delve into prior years’ funding concerns, the county claimed. Its lawyers cited state law and an N.C. Supreme Court case involving Beaufort County in arguing for a narrow interpretation of what funding is legally necessary to provide for an upcoming school year.

“The trial court permitted the BOE to convert this trial into political theater, airing past years’ grievances – when the BOE did not challenge funding – and inventing new wants and needs for purposes of trial.”

By not restricting the jury’s considerations solely to what was legally necessary to fund the schools for the upcoming school year, the county claimed, “This altered the case from a funding dispute over $8.1 million to one in which the jury was enabled to return a runaway verdict of over $91 million.”

One reason it took so long to file the appeal is that the county first needed to receive the trial transcript, which took months to prepare and ran 6,600 pages long. Trial exhibits covered an additional 6,900 pages.

The county appeal is being handled by the law firms of Wyrick Robbins Yates and Ponton of Raleigh and Perry, Bundy, Plyer, Long and Cox of Monroe.

Schwartz and Shaw of Raleigh represent the school board. Attorney Richard Schwartz declined to comment Thursday.

The school board’s response to the brief could arrive by mid-fall, but a hearing before the appeals court may not occur until December or January. Whichever side eventually loses can take the case to the N.C. Supreme Court.