Grossmont Union High School District v. STATE DEPARTMENT OF EDUCATION

The County of San Diego (County) and other counties provided mental health services to special education students. When the Legislature slashed the funding for such services to $1,000 statewide, the County sought and obtained a superior court judgment holding that because this was an unfunded state mandate, the County did not have to provide such services. In response, the State Department of Education (Department) required local school districts to absorb the costs of these services.

Grossmont Union High School District (Grossmont) sued the Department, primarily seeking a declaration that it should not have to pay these costs. The Department demurred, asserting Grossmont failed to exhaust available administrative remedies, specifically, that it first had to submit the dispute to California’s Commission on State Mandates (Commission). The trial court sustained the demurrer without leave to amend.

Grossmont asserts it would be futile to exhaust administrative remedies because the Commission’s authority extends over only state programs or levels of service, but the costs Grossmont complains of result from federal mandates. Grossmont also asserts that its contractual and…