EDUC 648 QUIZ 3: REVENUE—LOCAL
VS. STATE CONTROL. EXAM
QUESTIONS AND ANSWERS
1. Which legal principle asserts that local governments, including school districts, are mere
creatures of the state and only possess powers granted by the state legislature?
A. Dillon’s Rule
B. Home Rule
C. Federalism
D. Constitutional Plenary Power
Answer: A
Conceptual Explanation: Dillon’s Rule is a legal principle that states local governments
have only the powers expressly granted to them by the state, limiting local control over
revenue generation unless authorized.
2. In the context of school finance, what does ‘fiscal neutrality’ primarily refer to?
A. Every student receives the exact same dollar amount.
B. Property tax rates are identical across all districts.
,C. The quality of a child’s education should not be a function of the wealth of their local
district.
D. The state budget must be balanced regardless of education spending.
Answer: C
Conceptual Explanation: Fiscal neutrality, popularized by the Serrano v. Priest case,
means that education funding should be based on the wealth of the state as a whole rather
than the local property tax base.
3. What is the main characteristic of a ‘Foundation Program’ in state school funding
formulas?
A. The state provides a flat grant to every student regardless of local wealth.
B. Wealthy districts are allowed to keep all their local revenue without state interference.
C. The state captures all local property taxes and redistributes them equally.
D. The state guarantees a minimum level of funding per pupil, with local districts
contributing a required tax effort.
Answer: D
Conceptual Explanation: The Foundation Program is the most common formula; it sets a
per-pupil floor and requires a local contribution, with the state filling the gap.
, 4. Why did the U.S. Supreme Court rule against the plaintiffs in San Antonio Independent
School District v. Rodriguez (1973)?
A. They found that education is a fundamental right under the U.S. Constitution.
B. They determined that wealth-based classifications were ‘suspect’ and required strict
scrutiny.
C. They ruled that education is not a fundamental right under the U.S. Constitution and the
Texas system was rational.
D. They argued that the state of Texas had no responsibility for local school funding.
Answer: C
Conceptual Explanation: The Rodriguez decision effectively shifted school finance
litigation from federal to state courts by ruling that education is not a fundamental right
under the U.S. Constitution.
5. A ‘Power Equalizing’ formula is designed to ensure that:
A. Every district has the same total budget.
B. Districts at the same tax rate will yield the same revenue per pupil regardless of
property wealth.
C. The state takes over all local taxing authority.
D. Wealthy districts pay for all capital outlay projects in poor districts.
Answer: B
VS. STATE CONTROL. EXAM
QUESTIONS AND ANSWERS
1. Which legal principle asserts that local governments, including school districts, are mere
creatures of the state and only possess powers granted by the state legislature?
A. Dillon’s Rule
B. Home Rule
C. Federalism
D. Constitutional Plenary Power
Answer: A
Conceptual Explanation: Dillon’s Rule is a legal principle that states local governments
have only the powers expressly granted to them by the state, limiting local control over
revenue generation unless authorized.
2. In the context of school finance, what does ‘fiscal neutrality’ primarily refer to?
A. Every student receives the exact same dollar amount.
B. Property tax rates are identical across all districts.
,C. The quality of a child’s education should not be a function of the wealth of their local
district.
D. The state budget must be balanced regardless of education spending.
Answer: C
Conceptual Explanation: Fiscal neutrality, popularized by the Serrano v. Priest case,
means that education funding should be based on the wealth of the state as a whole rather
than the local property tax base.
3. What is the main characteristic of a ‘Foundation Program’ in state school funding
formulas?
A. The state provides a flat grant to every student regardless of local wealth.
B. Wealthy districts are allowed to keep all their local revenue without state interference.
C. The state captures all local property taxes and redistributes them equally.
D. The state guarantees a minimum level of funding per pupil, with local districts
contributing a required tax effort.
Answer: D
Conceptual Explanation: The Foundation Program is the most common formula; it sets a
per-pupil floor and requires a local contribution, with the state filling the gap.
, 4. Why did the U.S. Supreme Court rule against the plaintiffs in San Antonio Independent
School District v. Rodriguez (1973)?
A. They found that education is a fundamental right under the U.S. Constitution.
B. They determined that wealth-based classifications were ‘suspect’ and required strict
scrutiny.
C. They ruled that education is not a fundamental right under the U.S. Constitution and the
Texas system was rational.
D. They argued that the state of Texas had no responsibility for local school funding.
Answer: C
Conceptual Explanation: The Rodriguez decision effectively shifted school finance
litigation from federal to state courts by ruling that education is not a fundamental right
under the U.S. Constitution.
5. A ‘Power Equalizing’ formula is designed to ensure that:
A. Every district has the same total budget.
B. Districts at the same tax rate will yield the same revenue per pupil regardless of
property wealth.
C. The state takes over all local taxing authority.
D. Wealthy districts pay for all capital outlay projects in poor districts.
Answer: B
