The Goldwater Institute is charging that legislation approved last year allowing school districts to spend unused bond money is unconstitutional because it benefits so few districts.
Under the law, districts that have unused capital-bond proceeds from elections more than nine years earlier can use that money on any capital improvements, such as renovating a school, and not just the originally intended project.
About 3 percent of districts in the state currently fall under the provisions of the law passed by the Legislature in 2010, said Christina Kohn, attorney for the Phoenix-based Goldwater Institute.
The institute, on behalf of a Cave Creek voter, filed the lawsuit against the Cave Creek Unified School District in April, the day before construction was set to begin on a cafeteria expansion at Cactus Shadows High School. The district planned to pay for the renovation and other school refurbishments with $13 million in leftover bond money.
Kohn and Don Peters, attorney for the district, presented their oral arguments Tuesday in Maricopa County Superior Court.
Kohn said the narrowness of the law makes it a "special law," applicable to too few districts and therefore in violation of the state Constitution.
"If the purpose of the law is to help school districts with their financial troubles, then it's impossibly limited," she said. "Every district is going through financial trouble."
Peters said that just because the legislators might have been thinking about a specific district when they passed a law doesn't mean it was intended for only one district. As time passes, he added, more districts will be eligible under the law.
"In November, it will be the nine-year anniversary of the 2002 election," Peter said, so any bond money left over from that election would be freed up for other district projects.
Cave Creek's $13 million was left over from a $41 million bond issue approved in 2000 for a new high school and several other projects.
The district built new elementary and middle schools, but voters later rejected the new high school. That put the leftover money in limbo for several years. Because voters approved the money for a new high school, it couldn't be spent.
Originally, the Legislature passed a law in 2009 to allow districts to spend bond money, but it was determined to be too narrow to withstand a legal challenge. So, the legislation was rewritten to be broader and was signed into law in 2010.
The Goldwater lawsuit also claims the northeast Valley district is violating a contract with voters because "school repairs" were not included in the wording of the pamphlet mailed before the 2000 bond vote.