Friday, 08 March 2019 13:07

NC Court gives state more time to pay $730 million judgment

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RALEIGH — A Wake County Superior Court judge signed a consent order giving the state more time to pay a nearly $730 million judgment in a lawsuit over school technology funds.


Judge Vince Rozier signed the order Wednesday, March 6, extending a 2008 court order directing the state to transfer hundreds of millions of dollars into the Civil Penalty and Forfeiture Fund.

The dispute between the state and school districts over the funds dates to 1996, when a N.C. Supreme Court ruling in Craven County Board of Education v. Boyles determined civil fines imposed by state agencies should be viewed the same as criminal fines and should go to public schools.

In 1997, the General Assembly created the Civil Penalty and Forfeiture Fund. State agencies were directed to deposit money from civil penalties and fines into the fund for school technology needs, but some agencies withheld money because they didn’t believe it qualified as civil fines.

The N.C. School Board Association and several school districts took the state to court to recover the withheld money. In 2008, Superior Court Judge Howard Manning issued a court order directing the state to pay more than $747 million in civil fines and penalties collected by state agencies between 1996 and 2005. So far, school districts have received $18 million, or 2.5 percent of the amount owed.

The court order was set to expire in August 2018, but the NCSBA and school districts filed another lawsuit to extend the deadline.

“We are pleased that the court extended the judgment against the state,” Billy Griffin, president of the NCSBA and chairman of the Board of Education in Jones County, said in a statement. “These funds are vitally important to public schools across the state because there is certainly no shortage of needs for technology.”

Even with the court order extended, the court can’t force the state to pay. Citing Manning, Rozier writes in the order that, “because of the constitutional limitations and the separation of powers … the Court does not have the authority to direct the manner and means by which the judgment is to be satisfied or the amount of time in which it is done.”

Leanne Winner, NCSBA director of government relations, is optimistic the state will appropriate the money to satisfy the judgment.

“NCSBA continues to stress to the General Assembly the need to develop a payment structure to return the funds due to the public school students of this state for technology,” Winner said in a statement.

Speaker of the House Tim Moore, R-Cleveland, introduced a statewide school construction bond that includes a provision promising any money from the education bond used for school technology would be credited toward the judgment.

“This is the first of several steps necessary to address the judgment for several years.” Winner said.