Court Filings concerning incentive school funding "pooling" issue, fact finding and conclusion of the law, and portable buildings motion

District Court, order; District Court, motion for leave to file reply; District Court, order; District Court, Joshua intervenors' reply brief; District Court, Little Rock School District's (LRSD's) proposed findings and fact and conclusions of law regarding the pooling agreement; District Court, Pulaski County Special School District (PCSSD) second submission regarding ''pooling'' issues; District Court, Pulaski County Special School District's (PCSSD's) proposed findings of fact; District Court, Pulaski County Special School District (PCSSD) proposed conclusions of law; District Court, amendment to Pulaski County Special School District (PCSSD) supplemental motion regarding portable buildings; District Court, motion to extend time; District Court, notice of filing, Arkansas Department of Education (ADE) project management tool; District Court, notice of filing, Little Rock School District (LRSD) project management tool The transcript for this item was created using Optical Character Recognition (OCR) and may contain some errors. RECEIVED JAN 5 1995 FILED a of Desegregahon Morn1orm~ IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT OF ARKANSAS WESTERN DMSION U.S. DISTRICT COURT EASTERN DISTRICT ARKANSAS JAN O 4 1996 JAMES w. M~ORMAC_K, CLERK By: .(, ~ \.t,\ y,Q f>,, -- v DEP CLERK LITTLE ROCK SCHOOL DISTRICT Plainrifl: vs. PULASKI COUNTY SPECIAL SCHOOL DISTRICT NO. 1, ET AL. Defendants, MRS. LORENE JOSHUA, ET AL. LR-C-82-866 Intervenors, KATHERINE W. KNIGHT, ET AL. lntervenors. ORDER The Court has received the proposed 1995-96 budget for the Office of Desegregation Monitoring (ODM). See docket entry# 2567. Having carefully reviewed the budget, and there being no objections by the parties, the Court finds that the proposed 1995-96 budget for ODM should be and hereby is approved in its entirety. SO ORDERED this 4th day ofJanuary 1996 . fHIS DOCUMENT ENTERED ON DOCKET SHEET IN COMPLIANCE WITH Rl,JLE 58 AND/OR 79(a) FRCP ON I It/ 9? sv_v_1 --- 2 5 9 9 Cht.c k O YJ J;;''1 . &'/ ;41 / _fc,6m1JS1 b l1_ ----------- ----------------- Ji\N 1 9 ,996 FILED EAS-H/N ~1 1ffl','tt- CAAOURT KANSAS JAN 1 7 199' . t oeseQregation Monitonn~ o Office o JAMES W M ---- ___.. .......... IN---THE UNITED STATES DISTRICT ~T cCORMACI(, JLERK ----- EASTERN DISTRICT OF ARKANSAS WESTERN DIVISION 0PClRlt LITTLE ROCK SCHOOL DISTRICT, ET AL. v. NO. LR-C-82-866 PULASKI COUNTY SPECIAL SCHOOL DISTRICT, ET AL. MRS. LORENE JOSHUA, ET AL. KATHERINE W. KNIGHT, ET AL. SERVICEMASTER MANAGEMENT SERVICES, A Limited Partnership MOTION POR LBAVB TO FILE REPLY PLAINTIFFS DEFENDANTS INTERVENORS INTERVENORS INTERVENOR The Joshua Intervenors respectfully request the Court to afford them any opportunity to respond to the submission filed herein on behalf of Servicemaster Management Services dated January a, 1996. The response raises and addresses several cases which were not raised and discussed in our brief and motion for reconsideration. There is no prejudice to the Little Rock School District or Servicemaster by allowing such a submission. We also note that the LRSD has taken no position regarding wither the position of Servicemaster or Joshua. We further request five days beyond the date of an order granting permission to submit a reply in which to file our response. ,I I' Undersigned counsel is authorized to say that counsel for LRSD and Servicemaster have no objection to this request. Respectfully submitted, John W. Walker, P.A. 1723 Broadway Little Rock, AR 72206 (501 374-3758 CERTIFICATE OF SERVICE I do hereby state that a copy of the via U.S. mail to all counsel of record on January, 1996. was delivered day of IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT OF ARKANSAS WESTERN DIVISION LITTLE ROCK SCHOOL DISTRICT vs. No. LR-C-82-866 FILED U.S. DISTRICT COURT EASTERN DISTRICT ARKANSAS JAN 1 8 1996 JAMESjW. Mrf\ORMACK, CLERK By: ',Ir 0\,__/( \\,') u.-Q-. .'- \.. <. OEP Cl.fRJ( PLAINTIFF PULASKI COUNTY SPECIAL SCHOOL DISTRICT No. 1 1 ET AL R~ ~ ~ij\\/~" DEFENDANTS g;.~~~ ~j ' MRS. LORENE JOSHUA, ET AL KATHERINE KNIGHT, ET AL .lt.\N 1 f 1996 INTERVENORS INTERVENORS SERVICEMASTER MANAGEMENT SERVICES, Offi A Limited Partnership ice of Do.se~regation iv.or.itor;l1JNTERVENORS ORDER Upon motion of the Joshua Intervenors, and there being no objections, the time for filing a reply to the Servicemaster submission dated January 8, 1996, is hereby extended to and including January 26, 1996. IT IS SO ORDERED this 18th day of January 1996. rHIS DOCUME;tlT r.:rriSRED ON DOC:(ET SHEET IN .,;{)MPLIANCE WITH RULE 58 AND/OR 79(a) FRCP aN -t/lo/'?L ~v t1==- fim _ T JUDGE 2604 ,. . .. -- . . ,. . : . . .. .. - ... : ...... ... . . . . . . . , . . ~ -:. - ... ... : . . f ilED U.S. DISTRICT COURT EASTERN DISTRICT ARKANSAS IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT OF .ARKANSAS JAMES W. McCORMACK, CLERK WESTERN DISTRICT By: ------""'!:O~EP,-C-LE-RK-LITTLE ROCK SCHOOL DISTRICT, ET. AL. PLAINTIFFS v. NO. LR-C-82-866 PULASKI COUNTY SPECIAL SCHOOL DISTRICT, ET. AL. REce,,,eo--. DEFENDANTS MRS. LORENE JOSHUA, ET. AL. .ltlN 3 0 1996 KATHERINE W. KNIGHT, ET. AL. Office of Desegr . ti SERVICEMASTER MANAGEMENT SERVICES, ega on Monitoring A Limited Partnership - ~----- __ ...... - --......,.._ , .. JOSHUA INTERVENORS' REPLY BRIEF INTERVENORS INTERVENOR$ INTERVENOR The Joshua Intervenors filed a Motion and a Brief in Support of Reconsideration and Completion of Hearing regarding settlement between the Little Rock School District ("LRSD") and Joshua Intervenors. ServiceMaster has intervened in the matter as a party of interest since its contract with LRSD is involved. A hearing was held in December of 1995 and the Court issued a subsequent Order on December 11, 1995 in which it refused to rule on the merits of whether a settlement between LRSD and Joshua Intervenors existed. Instead the Court ruled that a provision in the contract between ServiceMaster and LRSD was against public policy and could not be enforced. Joshua Intervenors then filed its Motion for Reconsideration. ServiceMaster responded that the provision was not a termination clause and the Court should examine the intent of the parties as to the provision in question. The provision in question, Section 14 .12 entitled Pending Litigation, reads as follows: Each of the parties agree that as of the date of the execution of this Agreement a motion to enjoin School from entering this Agreement with ServiceMaster is now pending in the United States District Court, Eastern District of Arkansas, Western Division, styled Little Rock School District v. Pulaski County School District No. 1, et. al., No. LR-C-82-866. ServiceMaster does hereby release and forever discharge School from any and all actions, causes of action, damages, claims or demands which ServiceMaster may hereafter have, arising out of or in any way relating, directly or indirectly, from orders issued by the United States District Court which may terminate or modify this Agreement. (emphasis added) School is under no obligation or duty to appeal any decisions of the United States District Court affecting this Agreement. Further, the School's liability hereunder will be subject to the outcome (through either settlement, order of the Court or otherwise) of that litigation. The Court stated this ~revision allowed one party to unilaterally escape its obligation without a similar provision to the other and was against public policy. The Court did not address the merits of whether there was a settlement between LRSD and Joshua Intervenors. Joshua Intervenors have requested that the Court reconsider its ruling on the grounds that the United States Eighth Circuit Court of Appeals has stated that clauses in contracts that allow termination without cause are not against any established Arkansas public policy. ServiceMaster responded that Joshua Intervenors analogized the case improperly. Review of Joshua Intervenors' Brief in Support of the Motion for Reconsideration will show that Joshua cited the case for the law and not for the facts. The law was simply that a party may unilaterally terminate a contract and it does not go against any established Arkansas public policy. Union Nat. Bank v. Federal Nat. Mortg. Ass'n, 860 F.2d 847, 853 (8th Cir. 1988). The termination without clause did provide for a termination fee to be paid to Union. Union, 860 F.2d at 849. Next, ServiceMaster argued the intent of the parties was to be bound to the contract. The dominant rule is that the interpretation of a contract is controlled by the intention of the parties, and it is the duty of the courts to ascertain and give - effect to the meaning and intent of the parties as expressed in the language used. Les-Bil v. General Waterworks, 256 Ark. 905, 511 S.W.2d 166 (1974). The express language used in the provision made "the School's liability hereunder will be subject to the outcome (through either settlement, order of the Court or otherwise) of that litigation" --namely the motion in the school case concerning the ServiceMaster contract. When ServiceMaster entered into this Agreement it was fully aware of pending litigation. With full knowledge, ServiceMaster expressly agreed to be bound until a settlement or Court order terminated the contract. It is clear that ServiceMaster intended to be bound until a settlement or Court order terminated the contract. The Arkansas Court of .Appeals has held that parol evidence is .. . ... - . .. not admissible to show subjective intent of the parties. ThT rule does not allow a party to prove by oral testimony that clear and unambiguous words were subjectively intended to have a meaning not fairly attributable to them. Martin v. Martin, 6 Ark.App. 18, 637 S.W.2d 612 (1982). ServiceMaster cited a case which held that" [i)t is a wellestablished principle of law that, in the interpretation or construction of the contract, the construction the parties themselves have placed on the contract is entitled to great weight, and will generally be adopted by the courts in giving effect to its provisions. This is especially true in cases of ambiguity in the written contract." Worthen Bank & Trust Co. v. Adair, 15 Ark .App. 144, 151, 690 S.W.2d 727, 731 (En Banc 1985). There is no ambiguity in the provision. The intent of the parties is clearly expressed in the provision, Section 14.12. The construction is that settlement or an order from the Court will terminate the contract. The objective manifestation of intent, not subjective manifestation, is what the court examines. The Court ruled that the provision, Section 14.12, was against public policy and refused to rule on the merits of the case. Joshua Intervenors motion that, in light of case law stating a provision which allows termination, even by only one party, is not against any established Arkansas public policy, the Court reconsider its ruling. In addition, Joshua Intervenors request that the Court determine whether LRSD and Joshua Intervenors entered - into settlement which serves as grounds for termination ot the contract between LRSD and ServiceMaster. In addition, since ServiceMaster was not a party to the litigation when the contract was entered, it is unreasonable to interpret the last sentence of 14.12 to include ServiceMaster as a party involved in any settlement. For the foregoing reasons, the reasons advanced by Servicemaster in oposition to reconsideration should be rejected. Respectfully submitted, John W. Walker, P.A. 1723 Broadway Little Rock, AR 72206 BJryiCW:a~lkeru !~ CERTIFICATE OF SERVICE I do hereby state that a copy of the foregoing d, delivered to all counsel of record via U.S. mail on this _ _____. ___ day of January, 1996. ~id~~ iiw.walker JOHN W. WALKER RALPH WASHINGTON MARK BURNETTE AUSTIN PORTER JR. JOHN W. WALKER, P.A. ATTORNEY AT LAW 1723 BROADWAY LITTLE ROCK, ARKANSAS 72206 TELEPHONE (501) 374-3758 FAX (501) 374-4187 . l~M 3 0 ,996 Oflice ot Desegregation Momtcring ENCLOSURE MEMORANDUM DATE: January 26, 1996 TO: Steve Jones, Esq. Jack, Lyon & Jones, P.A. 3400 Capitol Towers Capitol & Broadway Streets Little Rock, AR 72201 Christopher Heller, Esq. Friday, Eldredge & Clark 2000 First Commercial Building Little Rock, AR 72201 Jerry Malone, Esq. c/o Little Rock School District 810 West Markham Little Rock, AR 72201 Sam .Jones, Esq. \Nright, Linrlsey & JAnnings 2200 Worthen Bank Building Little Rock, AR 72201 FROM: John W. Walker, Esq. Richard Roachell, Esq. Roachell & Streett 401 W. Capitol Ave. Suite 504 Little Rock, AR Ms. Ann Brown, Monitor Office of Desegregation Monitoring 201 East Markham, Suite 510 Little Rock, AR 72201 Tim Humphries, Esq. Attorney General's Office 200 Tower Building 323 Center Street Little Rock, Ar 72201 RE: LRSD, et al. v. PCSSD, et al.; NO. LR-C-82-866 - ENCLOSURES: Joshua lntervenors' Reply Brief HERSCHEL H. FRIDAY (11221114) ROBERT V. LIGHT, r . A. WILLIAM H. SUTTON, ,.A . JAMES W . MOOIU I - YRON M . EISEMAN , JR . ,, . A . OE 0. BELL, ,, .A. OHN C . ECHOLS, ,,.A . JAMES A . BUTTNY . ,, . A . FREDERICKS . UNSERY. , . A . H . T. LARZELEIH,. ,,.A . OSCAft E. DAVIS, JR . f' . A . JAMES C . CLARK, JR . , , . A . THOMAS r. LEGGETT, t' . A . JOHN DEWEY WATSON, ,, ,A. PAUL I . BENHAM Ill, ,, . A. LARRY W. BURKS , r . A . A . WYCKLIFF NISBET, Jft., ,,.A. JAMES EDWARD HARRIS. P. A . J . PHILllr MALCOM, r.A . JAMES M . SIMrSON, ,,.A . MEREDITH P. CATLETT, P .A. JAMES M . SAXTON , P . A. J . SHE,,HERD RUSSELL Ill, P . A. DONALD H . IACON , ,,.A. WILLIAM THOMAS BAXTER, , . A . WALTER A . PAULSON II, r . A . BARRY E. COPLIN , P . A . RICHARD 0 . TAYLOR , ,,,A. JOSEPH 8. HURST , JR ., , . A . ELIZABETH ROBBEN MURRAY, r . A . CHRISTOPHER HELLER . , . A . LAURA HENSLEY SMITH, , . A . ROBERTS . SHAFER , P . A . WILLIAM M. GRIFFIN Ill, r.A. THOMAS N . ROSE , P. A . MICHAELS. MOORE. ,.A . DIANE S . MACKEY , P.A. WALTER M . EBEL Ill , P . A . KEVIN A . CRASS. P. A. WILLIAM A . WADDELL, JR . , . A . FRIDAY, ELDREDGE &, CLARK A PARTNERSHIP OF INOIVIOUALS ANO PROFESSIONAL ASSOCIATIONS ATTORNEYS AT LAW 2000 FIRST COMMERCIAL BUILDING 400 WEST CAPITOL LITTLE ROCK, ARKANSAS 72201-3493 TELEPHONE 5013782011 FAX NO. 601-378-2147 January 26, 1996 ,/AN 2 9 1996 Offic e of Desegregation M 0nlH.l1111g Hon. James W. McCormack Clerk of Court United States District Court Eastern District of Arkansas 600 W. Capitol, Suite 402 Little Rock, AR 72201-3325 Re: Little Rock School District, et al vs. Pulaski County Special School District, et al USDC No. LR-C-82-866 Dear Mr. McCormack CLYDE TAI TUflNCR, P.A . CALVIN J. HALL. ~. A . ICOTT J . LANCAITEft, P. A . JERflY L. MALONE, P. A . M . GAYLE CORLEY, , . A . ROIERT I . BEACH, JPI . , P. A . J . LEE BROWN, P. A . JAMES C . IA~EII, Jft., r . A . H . CHARLES OICHWENO, JR . r .A. HARflY A . LIGHT, , . A . SCOTT H . TUCKER, r . A . JOHN CLAYTON RANDOLPH, r.A. GUY Al TON WADE, P . A . PfllCE C . GARDNER, P. A . J. MICHAEL riCKENS, r . A . TONIA r . JONES , r . A . DAVID 0 . WILSON, P. A . JEFFREY H . MOOIIE, P.A. ANDREW T. TURNER DAVID M . GRAF CA"LA G. SPAINHOUR JOHN C . FENDLEY, JR . ALLISON O"AVES JOHANN C. ROOSEVELT R. CHIIISTOrHER LAWSON GREGORY D , TAYLOR TONY L. WILCOX FRANC , HICKMAN IETTY J . DEMORY IARIARA J . RAND JAMES W, SMITH CLIFFORD W. P'LUNKETT WILL BONO DANIELL. HERRINGTON COVNlll WILLIAM J . SMITH WILLIAM A . ELOIIEOGE, Jft . , P.A . l,S. CLARK WILLIAM L. TEflRY, l" . A . WILLIAM L. rATTON , JR ., P. A. WfUTflll ' I OIIUCT NO , (6011 370-3323 Enclosed herewith please .find an original and three copies of the Little Rock School District's Proposed Findings and Fact and Conclusions of Law Regarding the Pooling Agreement with regard to the above-captioned matter. Please file same and return a file marked copy to us. By copy of this letter we are serving all counsel of record. JCFjr/cf Enclosures cc: Mr. John Walker (w/encl.) Mr. Sam Jones (w/encl.) Mr. Steve Jones (w/encl.) Sincerely, J~~f!~. ,er Mr. Richard Roachell) (w/encl.) Ms. Ann Brown (w/encl.) Mr. Timothy G. Gauger (w/encl.) Hon. Susan Webber Wright (w/encl.) IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT OF ARKANSAS WESTERN DIVISION LITTLE ROCK SCHOOL DISTRICT v. NO. LR-C-82-866 PULASKI COUNTY SPECIAL SCHOOL DISTRICT NO. 1, ET AL MRS. LORENE JOSHUA, ET AL KATHERINE KNIGHT, ET AL .IM.J 2 9 1996 Office of Desegregation Monau1 u 'Y LRSD'S PROPOSED .FINDINGS AND FACT AND CONCLUSIONS OF- I;AW - - -- .. REGARDING THE POOLING AGREEMENT INTRODUCTION PLAINTIFF DEFENDANTS INT ERVEN ORS INTERVENORS This action concerns implementation of the September 1989 Settlement Agreement ("Settlement Agreement") in the above-styled case. The Pulaski County Special School District ("PCSSD") moved for an order requiring the Little Rock School District ("LRSD") to pay PCSSD $167,113.00 in majority-to-minority ("M-to-M") payments received by LRSD from the State of Arkansas based on Section II, Paragraph o of the Settlement Agreement (the "Pooling Agreement"). LRSD responded to PCSSD's motion alleging that LRSD was released from its pooling obligations by PCS SD' s anticipatory breach. Based on the party's pleadings, this Court ruled that, even assuming PCSSD was in breach, the clauses of the Pooling Agreement at issue were unrelated and ordered LRSD to pay PCSSD $167,113.00. appealed. LRSD On appeal, the Eighth Circuit vacated this Court's order and directed it to "take evidence regarding the purposes of the clauses at issue." See Little Rock School District v. Pulaski County Special School District, 60 F.3d 435, 436 (8th Cir. 1995). The Eighth Circuit specifically identified the following issues to be addressed on remand: (1) Was the Pooling Agreement a means to facilitate equalization; (2) What was meant by the term "equalize"; (3) Whether the "instructional budgets" of interdistrict schools are equalized; and, (4) Why is there no central account into which pooled moneys are deposited? Id., at 436-37. Following hearings during which both parties presented evidence, this Court makes the following findings of fact and conclusions of law as required by Fed. R. Civ. P. 52. Any other statement in this opinion which may be deemed a finding of fact is also adopted as such. FINDINGS OF FACT A. Background. 1. The Pooling Agreement resolved two disputes between LRSD and PCSSD. The first dispute concerned $2 million to be paid by the State of Arkansas as a part of the Settlement Agreement. The original version of the Settlement Agreement contained formulas by which the State would make payments to LRSD and PCSSD. The final version of the Settlement Agreement converted those formulas to a fixed stream of payments. This conversion resulted in $2 million in state settlement funds to which both LRSD and PCSSD claimed entitlement. 2 3. The second dispute related to M-to-M payments from the State. The M-to-M Stipulation provides, "The state shall pay the costs for full-time equivalent students who have been transferred to the host district." (Docket No. 706). PCSSD argued that this provision required the State to pay the host district the home district's average per student cost. This would have increased the amount of M-to-M payments to PCS SD because LRSD' s average per student cost was greater than PCSSD's. 4. PCSSD's argument was inconsistent with the State's interpretation of the M-to-M Stipulation and its practice of paying the host district its average per student cost. (Transcript, v. I 1 , p. 114-15; Transcript, v. II, p. 125). Dr. Donald Stewart, PCSSD's Chief Financial Officer, testified: I supported Mr. Sam Jones' ... argument that we really should be receiving (LRSD's) average cost for educating a student because -- based on the theory -- well, I'm not sure based on what. It was a good argument because it would have given us more money. (Transcript, v. I, p. 115]. 2 5. The Pooling Agreement provides: 1) In any application for aid pursuant to Section 6 of 1The transcript of the September 9, 1995, hearing is cited as volume I, and the transcript of the December 14, 1995, hearing is cited as volume II. 2Dr. Stewart later offered as a basis for PCSSD's argument that LRSD students are more expensive to educate. However, Dr. Stewart admitted that he was not aware of any evidence that LRSD M-to-M transfer students would be more expensive to educate than PCSSD students. (Transcript, v. II, p. 123). Dr. Stewart further admitted that even assuming PCSSD was spending a little more on LRSD M-to-M transfer students, PCSSD was not spending as much per student as LRSD. [Transcript, v. II, p. 124). 3 Act 24 of the 1989 Regular Session of the Arkansas General Assembly, the receiving district for M to M students may include in such application any M to M students it hosts who are eligible for participation pursuant to section 6(A) of said Act. 2) The State shall continue to make payments under the August 26, 1986 M to M stipulation so that the host district receives its average cost of educating a student for each M to M transfer student enrolled in the host district. 3) When at least one Interdistrict School is operating in LRSD and PCS SD, all M to M payments generated by Interdistrict School students paid by the state to LRSD and PCSSD (including payment to each district as sending district and receiving district), except transportation payments, will be pooled for the education of all Interdistrict School students. The instructional budgets of the Interdistrict Schools will be equalized. This provision does not change each district's obligation to construct and maintain the Interdistrict Schools within its boundaries. The State payments for M to M students not enrolled in Interdistrict Schools will continue in accordance with paragraph (2) above. 4) Beginning the first year an operating in LRSD and PCSSD, $200,000 per year for five years be used by both districts to Schools. (Settlement Agreement 2, 1 0). Interdistrict School is PCSSD will contribute to the pool of funds to operate Interdistrict 6. Both LRSD (Romine and Washington) and PCSSD (Baker) had interdistrict schools operating in the 1991-92 school year. (Transcript, v. I, p. 97). B. Was the Pooling Agreement a means to facilitate equalization? 7. Al though PCS SD originally contended that the sentences in paragraph three of the Pooling Agreement concerning pooling and equalization were unrelated and "simply happen to appear in the same section of the Settlement Agreement," (Docket No. 2101], PCSSD's own witnesses testified at trial that the provisions are 4 related. Dr. Stewart testified: Q: And section 110 11 is all part of one agreement made to resolve those issues that arose after the March settlement? A. That is correct. Q. And the component parts of section 110 11 are all related to each other? A. Yes. [Transcript, v. II, p. 11). PCSSD Superintendent Bobby Lester's testimony was identical to that of Dr. Stewart. [Lester Depo., p. 6 J . 8. The fact that pooling and equalization are described in consecutive sentences in the same paragraph of the Pooling Agreement also indicates that the provisions are related. This conclusion is further supported by the fact that the final sentence in that paragraph begins, "This provision . ," referring to the entire paragraph. [Settlement Agreement II, 1 0(3)). 9. How the provisions are related was explained by Dr. Ruth Steele who was LRSD Superintendent from July of 1989 through June 30, 1992, [Steele Depa . , p. 4), and who was involved in negotiating the Pooling Agreement. [See Steele Depo., p. 6-7). Dr. Steele testified that the funds in the pool were to "be used for the education of students attending the interdistrict schools" and that "the amount that would be spent would be equalized so that no students from either district would be penalized in terms of a per pupil expenditure . . . . " [ Steele Depa. , p. 7 J . 10. PCSSD came forward with no evidence which contradicted the testimony of Dr. Steele. Even assuming such evidence exists, 5 - this Court finds Dr. Steele's testimony to be credible and gives it substantial weight. Accordingly, this Court finds that the Pooling Agreement was a means to facilitate equalization. B. What is meant by the term "equalize"? 11. Both LRSD and PCSSD agree (and this Court finds) that the term "equalize" means an equal per pupil expenditure. 12. The only contemporaneous explanation of the meaning of the Pooling Agreement was made by Chris Heller, Attorney for LRSD, during hearings before Special Master Aubrey Mccutcheon on September 26 and 27, 1989. [Transcript, v. I, p. 124; Transcript v. II, p. 14). 3 In explaining the Pooling Agreement to the Special Master, Heller stated: Another issue that has been resolved is that once interdistrict schools are operating in both Little Rock and Pulaski County, the state funding generated by those interdistrict[) students4 would be pooled and the operation budgets for those two schools or whatever number of schools would be equalized so that interdistrict students. whether attending school in Pulaski County or Little Rock. would have the same amount spent for their education. [Transcript, v. II, p. 13 (emphasis supplied)). 13. Dr. Stewart agreed that the Pooling Agreement, as explained by Heller, required an equal per pupil expenditure: Q. Now, if we assume that equalizing instructional 3At these hearings, the parties were seeking approval of the Settlement Agreement, and the Special Master was attempting to determine whether there was, in fact, an agreement among the parties. [Transcript, v. II, p. 12). 4LRSD and PCSSD agree that only M-to-M payments are to be pooled and not all state funding generated by interdistrict school students. [Transcript, v. II, p. 43-44). 6 budgets means that the same amount is going to be spent for the education of students, whether they go to school in the Pulaski County School District or the Little Rock School District, doesn't that mean you would have to build your budget based on an agreed upon equal per student expenditure? A. Under that assumption, yes. * * * Q. In order to have the same amount spent for their education, don't you have to develop a budget based on an equal per pupil expenditure? A. Technically, yes. [Transcript, v. II, p. 43-44). Dr. Stewart admitted that the "assumption" made in the above question was exactly what Heller reported to the Special Master was the intent of the Pooling Agreement. (Transcript, v. II, p. 43-44]. Dr. Stewart also admitted that a budget can be prepared based on a predetermined per pupil amount. (Transcript, v. II, p. 39). An interdistrict school's budget could then be calculated by multiplying the number of students by the established per pupil budget. II, p. 44-45). (Transcript, v. 14. The parties agree that the funds from the pool should be distributed on a per student basis but disagree as to which students should be counted for the purpose of distribution. (See Transcript, v. II, p. 41-42). PCSSD contends that only M-to-M transfer students attending interdistrict schools should be considered. LRSD argues that all interdistrict school students should be considered. The Pooling Agreement is unambiguous in this regard. It provides, "[A]ll M-to-M payments generated by Interdistrict School students . 7 will be pooled for the education of all Interdistrict School students. 11 [Settlement Agreement II, 1 O ( 3) ( emphasis supplied) ] . Thus, the plain language of the Pooling Agreement states that the relevant student population for distribution of the pool is "all Interdistrict School Students." 15. Even assuming the Pooling Agreement to be ambiguous in this regard, the evidence presented a trial further supports the conclusion that the parties intended the pool to be distributed based on the total number of interdistrict school students. 16. In addition to resolving the disputes noted above, the Pooling Agreement served two additional purposes. First, both districts were concerned that the M-to-M Stipulation would work to the advantage of the other and viewed pooling as a hedge against this possibility. Depa. , p. 7 J . [Transcript, v. I, p. 10, 11 and 20; Lester Second, LRSD was concerned that LRSD students attending PCSSD interdistrict schools would not have resources spent for their education equivalent to what would be spent on the students if they remained in LRSD. 5 At the time of the agreement, LRSD was spending on average $800.00 to $900.00 more per student than PCSSD. [Transcript, v. I, p. 10). 17. Dr. Steele testified: [M)y concern was always that you make sure that the students who move from our district to Pulaski County are not shortchanged in terms of any per pupil expenditure that [would be) spent for them; and that the pattern of 5John Walker, attorney for the Joshua Intervenors, shared LRSD's concern because it would be his clients transferring from LRSD to PCSSD. [Transcript, v. I, p. 25-26). 8 funding for the interdistrict schools would be similar to that of the magnet schools, not necessarily in terms of the exact amount [spent per pupil], but that there would be an amount identified that would be spent for the students who attended those schools. 6 [Steele Depo., p. 11). Dr. Steele explained that the Pooling Agreement contemplated that "[t]here would be a per pupil amount established" to equalize funding for the education of "the total student population in the interdistrict school." [Steele Depo., p. 9 (emphasis supplied); see also Steele Depo, p. 15-16 and 23). 18. Similarly, Earl Jones, who was LRSD Manager of Support Services from July of 1989 through June of 1991 and who was also present during the negotiation of the Pooling Agreement, [Transcript, v. II, p. 156 and 158), testified that the Pooling Agreement contemplated that LRSD and PCSSD would agree to a per - pupil budget . for all interdistrict school students. [Transcript, v. II, p. 159). Jones explained that the requirement that the budgets of the interdistrict schools be equalized was important to LRSD because LRSD was concerned that students would not "enjoy the same type education" in PCSSD interdistrict schools and that equalization was a means "to help guarantee that that [would] happen." [Transcript, v. II, p. 178]. Jones noted that the 6Similarly, Dr. Steele testified that the funds in the pool were to "be used for the education of students attending the interdistrict schools" and that "the amount that would be spent would be equalized so that no students from either district would be penalized in terms of a per pupil expenditure .... 11 [Steele Depo., p. 7). Dr. Steele stated that the Pooling Agreement was "based on the magnet school model." [Steele Depo., p. 7; see also Steele Depo., p. 8-9). Finally, Dr. Steele testified that PCSSD's interpretation of the Pooling Agreement was inconsistent with the intent of the parties. (Steele Depo., p. 15 and 16.) 9 process by which the per pupil budget for the original magnet schools was established "could easily be used" to implement the Pooling Agreement. (Transcript, v. II, p. 159]. 19. PCSSD presented no evidence that the intent of the Pooling Agreement was to distribute the pool based on the number of M-to-M students in interdistrict schools. To the contrary, in a memo to Lester dated September 2, 1992, Dr. Stewart stated: I would suggest that the proper procedure (to implement the Pooling Agreement] would be to pool all funds, including PCSSD's $200,000.00 as called for in the agreement and then to divide these funds equally based on the number of students actually enrolled (three-quarter average daily membership) in all Interdistrict Schools. [Exhibit 343 (emphasis supplied); Transcript, v. I, p. 29]. With regard to Dr. Stewart's memo, Lester testified: Q. So if you're going to implement what Dr. Stewart said in [his September 2, 1992] memo, then we would take the total pool of M to M funds, plus the county's $200,000 and divide by the total number of interdistrict school students, third quarter enrollment, right? A. Right. (Lester Depa., p. 24 (emphasis supplied)]. Dr. Stewart agreed that his methodology fails to take into account two requirements of the Pooling Agreement: (1) that instructional budgets be equalized, and (2) that the funds be pooled for the benefit of all interdistrict school students. (Transcript, v. II, p. 42-43]. on the contrary, Dr. Stewart acknowledged that the interpretation of the Pooling Agreement urged by LRSD is entirely consistent with the language of the agreement. [Transcript, v. II, p. 44-45]. 20. On the bottom half of Exhibit 382, Dr. Stewart demonstrated the results if the pool was divided based on the total 10 number of interdistrict school students. Dr. Stewart conceded that the methodology applied on the bottom half