Citation
Immigration and education legislation and its effects on policies relating to undocumented immigrant children

Material Information

Title:
Immigration and education legislation and its effects on policies relating to undocumented immigrant children
Creator:
Raska, Rose Alvine
Publication Date:
Language:
English
Physical Description:
x, 207 leaves : ill. ; 29 cm.

Subjects

Subjects / Keywords:
Children ( jstor )
Citizenship ( jstor )
Education ( jstor )
Equal protection ( jstor )
Illegal immigration ( jstor )
Immigration ( jstor )
Public schools ( jstor )
Schools ( jstor )
Students ( jstor )
Undocumented immigrant status ( jstor )
Dissertations, Academic -- Educational Leadership, Policy, and Foundations -- UF ( lcsh )
Educational Leadership, Policy, and Foundations thesis, Ph.D ( lcsh )
City of Tallahassee ( local )
Genre:
bibliography ( marcgt )
theses ( marcgt )
non-fiction ( marcgt )

Notes

Thesis:
Thesis (Ph.D.)--University of Florida, 2000.
Bibliography:
Includes bibliographical references (leaves 196-206).
General Note:
Printout.
General Note:
Vita.
Statement of Responsibility:
by Rose Alvine Raska.

Record Information

Source Institution:
University of Florida
Holding Location:
University of Florida
Rights Management:
Copyright [name of dissertation author]. Permission granted to the University of Florida to digitize, archive and distribute this item for non-profit research and educational purposes. Any reuse of this item in excess of fair use or other copyright exemptions requires permission of the copyright holder.
Resource Identifier:
024901963 ( ALEPH )
45640900 ( OCLC )

Downloads

This item has the following downloads:


Full Text






IMMIGRATION AND EDUCATION LEGISLATION AND ITS EFFECTS ON POLICIES RELATING TO
UNDOCUMENTED IMMIGRANT CHILDREN

















By

ROSE ALVINE RASKA
















A DISSERTATION PRESENTED TO THE GRADUATE SCHOOL OF THE
UNIVERSITY OF FLORIDA IN PARTIAL FULFILLMENT OF THE
REQUIREMENTS FOR THE DEGREE OF
DOCTOR OF PHILOSOPHY UNIVERSITY OF FLORIDA 2000















DEDICATED TO:

Germaine G. Bourque Raska (1915-1991), my most wonderful Mother,
without whose spirit, inspiration and belief in me,
I would not have attempted such a monumental task.








































ii















ACKNOWLEDGMENTS

Without the support and assistance of certain individuals this research would not have been possible. I greatly appreciate the encouragement and guidance of my chair, Dr. David S. Honeyman, who gave me the drive and tenacity to complete this project. My appreciation again goes to Dr. M. David Miller, Dr. Walter L. Smith and Dr. Lee J. Mullally, my supervisory committee members. I would also like to thank Dr. R. Craig Wood.

Special thanks go to Bettie Hogle, Director of Applied Technology, Seminole County Public Schools, for her counsel and support through out this project. I am especially grateful to Dr. Michael James Murray, Winona State University, for his encouragement and belief in my abilities.

Most importantly, I must acknowledge my deceased mother, Germaine B. Raska, who knew that I could and would achieve this goal.




















iii
















TABLE OF CONTENTS



ACKNOW LEDGM ENTS ......................................................................................... ... iii

LIST OF TABLES ........................................................................................................... vii

LIST OF FIGURES.......................................................................................................... viii

ABSTRACT ................................................. ................................................................ ix

CHAPTERS

1 INTRODUCTION ................................................................................................... 1I

Purpose of the Study ........................... ................................................ 2
Significance of the Research ....................................................................................... 3
Statem ent of the Problem ............................................................................................ 3
History. ................................................................. 4
Historical Im m igration Legislation. ...................................... 5
Im m igration Policy................................................................................................. 9
Im m igration Statistics .............................................................. ............................. 10
Illegal Im m igration...................................................................................................... 11
Im m igrant Education ........................................... .................................................. 14
Societal Im pact............................................................................................................ 17
Fiscal Responsibilites ................................................................................................. 21
Research Question ....................................................................................................... 25
M ethodology ..................................................................................................................... 25
Definition of Term s ................................................................................................... 26
Lim itations ........................................................................................................................ 27
Design of the Study .............................................. ....................................................... 27
Organization of the Chapters...................................................................................... 28

2 HISTORICAL REVIEW OF IMMIGRATON LEGISLATION ............................. 29

Introduction ................................................. 29
Im m igration Legislation ...................................................................... ............................ 29
Am erican Im m igration Before 1920 ..................................... .... .............. 32
Im m igration Policy After 1920 ...................................... 34
The 1952 Im m igration Act .......................................................... ........................... 38



iv










The 1965 Im m igration Act.......................................................................................40
Im m igration Policy After 1965 .......................................................................... 42
Educating Illegal Im m igrant Children............................................................ 44
Sum m ary ..... ...................................................................................................... 59

3 IMMIGRATION LAWS AND PROPOSITION 187 .................................... .... 61

Introduction .................................................................................................... ............. 61
Background ................................................................................................ 61
Im m igration Laws ..................... .................................................................................. 66
Illegal Aliens ..................................................................................................................... 69
Proposition 187 .................... ....................................................................................... 74
Constitutional V iolations ......................................................................................... 77
Conflict with Federal Laws ...................................................................................... 80
Due Process ....................................................................................... 82
Im m igration and Education ............................................................................................ 84
Florida Im m igration and Education ................................................................ 90
Sum m ary .... ...................................................................................................... 97

4 FINANCIAL AND ETHICAL CONSIDERATIONS ....................................... 99

Introduction ... .................................................................................................... 99
Legal Basis for States' Responsibilities .................................................................. ... 99
Education Finance ..................................................... ................................................ 103
Florida Education Finance ..................................................................................... 108
Population D ata ................................................ .......................................... .......... ..... 111
Educational Rights of Undocumented Immigrant Students ..................................... ... 113
Im m igrant Students ................................................................................................ 116
Ethics and the Dem ocracy of Education ....................................................................... 119
Educating A ll Children........................................................................................... 122
Sum m ary .... ..................................................................................................... 126

5 IMMIGRATION EDUCATION POLICY INCLUSIONS FOR THE STATE
OF FLORID A ..................................................... ................................................ 127

Introduction .................................................................................................... 127
The Right to Learn ..................................................... ............................................... 127
Distinctions ....................................... 128
Im m igration Facts ..................................................... ................................................ 128
Federal Policies and Laws........................................ ................................................. 129
Florida Legislation ........................................ 133
Florida School Laws......................................... ................................................... 134
Florida's Education Strategic Priorities ..................................... 136
Policy Enhancem ents ........................................ 137
Sum m ary ......................................................................................................................... 143



V












APPEN D IX ..................................................................................................................... 146

LIST O F REFEREN CES ................................................................................................ 196

LEG A L REFEREN CES ......................................... ........................................ 203

BIO G R A PH ICA L SK ETCH ........................................................................................ 207















































VI















LIST OF TABLES

Table page

1-1 Estimated Illegal Immigrant Population for Top Twenty Countries of Origin and
Top Twenty States of Residence: October 1996 ............................. .. .. 13

2-1 Timeline of U.S. Immigration and Alien Education Policies ................................ 57

3-1 Immigration to the U.S. in 1992.................................................................... 69

4-1 Florida EIEP Student Funding (100% Federal Funding) .................................... 108

4-2 Im m igration and Florida.......................................................................................... 111


































vii














LIST OF FIGURES

Figure ae

1-1 School-Age Immigrant Population ........................................................... 15

2-1 U.S. Foreign-Born Population. ............................................................ 43

3-1 Top Ten States Where Illegal Aliens Reside ............................................ 72

4-1 Estimated Undocumented Immigrant Population in Florida in 1993
by Country of Origin Here is a figure. ..................................... 112


































viii















Abstract of Dissertation Presented to the Graduate School
of the University of Florida in Partial Fulfillment of the Requirements for the Degree of Doctor of Philosophy IMMIGRATION AND EDUCATION LEGISLATION AND ITS EFFECTS ON POLICIES RELATING TO UNDOCUMENTED IMMIGRANT CHILDREN By

ROSE ALVINE RASKA

August 2000


Chairman: David S. Honeyman
Major Department: Educational Leadership, Policy, and Foundations The need for an effective public policy regarding the education and assimilation of illegal immigrant children had become the topic of many discussions. Beginning with the Plyler decision in Texas in 1982, California's Proposition 187 and the Gallegly amendment in 1996, attempts were made to legislate such policy. Florida had the fourth largest percentage of illegal immigrant population in the United States. Along with that, the fourth largest number of illegal immigrant children, which we had a moral, if not legal, obligation to educate. Educating immigrant children to the ways of our society, along with English and mathematics, provided long-term benefits in terms of both successful citizenship and cost effectiveness. States needed to develop immigrant education policies that provided equitable opportunities for all children. Much research had been done on






ix









the societal and fiscal effects of illegal immigration as a whole, but little addressed the education aspect and its costs or consequences.

The purpose of this study was to analyze the history of immigration policy and subsequent court cases that had influenced the treatment of undocumented immigrant children. In addition, to analyze the existing legal basis for educating undocumented immigrant children through the examination of federal and state legislation, attorney general opinions, state statutes, and district school board policies. The desired outcome was to suggest recommendations for policy inclusions for educating illegal immigrant K-12 students.

Policy components for effective immigrant education needed to include: 1) Immigrant student inclusion in all school and district assessments; 2) staff development training in the understanding of the special needs of immigrant children; 3) development of additional instructional materials for immigrant children; 4) assessment instruments in languages other than English and Spanish; 5) increased school counseling services for immigrant children; 6) increased immigrant parent involvement in overall school programs; 7) Inclusion of limited English proficient children in school-wide programs; and 8) a determination of what investments the public was willing to make to ensure the education and future economic success of immigrant children.













x















CHAPTER 1
INTRODUCTION


This examination of the history of immigration and education legislation in the United States reveals the change process that law and policy underwent through the years. It takes into account both, immigration to the United States and the immigrants themselves. Immigration policies were made at the federal level and addressed broad issues such as quotas and enforcement of immigrant parameters. Immigrant policies, on the other hand, were made at the state level and focused on immigrants already residing in the United States. Immigrant policy makers dealt with how to integrate immigrants into the American population and assist them with public benefits during the transition.'

As a nation whose ancestors were all immigrants, much of historical U.S. foreign policy invited foreigners into the country. When immigrant limits and control of U.S. borders became an issue, so did educating the legal and illegal immigrant student population. Laws were passed to control immigration and those who broke the laws in order to enter the U.S. became illegal immigrants. Through no fault of their own, their children were in a country where they were not official residents and needed to be educated.





1Rocio Del Sagrario Toriz , "Federal and State Responsibility for Undocumented Immigration," Berkeley McNair Journal Three, no. Summer 1995 (1995) .


1






2

Each time an immigration law or policy was implemented, the education system was affected. It was believed that had the federal government enforced immigration policy, the states would have not suffered the financial burden incurred from educating the children of immigrants, both legal and illegal.

National estimates of growth in the immigrant student population projected a

increase of more than 20 percent, from 34 million in 1990 to 42 million in 2010. It was estimated that more than half of that growth would be attributed to children of immigrants. Proportional changes in Florida's school-age population mirrored or exceeded those occurring in the state's general population. Although in 1990, Hispanics were 12 percent of the total school-age population, by 1996 they had grown to 16 percent. 2 School-age children came from all over the world with a high concentration coming from Hispanic countries.


Purpose Of The Study

The purpose of this study was to analyze the history of immigration policy and subsequent court cases that have influenced the treatment of undocumented immigrant children. In addition, to analyze the existing legal basis for educating undocumented immigrant children through the examination of federal and state legislation, attorney general opinions, state statutes, and district school board policies. The desired outcome was to suggest recommendations for policy enhancements for educating illegal immigrant K-12 students in the state of Florida.





2 Martha J. Miller (1997). Student Enrollment Figures by Ethnicity and Race. Tallahassee, Fl: Strategy Planning Department, Florida Department of Education.








Significance of the Research

Florida school districts were required to follow federal regulations and Supreme Court guidelines in school admission requirements. Due to the sheer numbers of undocumented immigrant students who resided in and continually entered the state, there was a need for a precedent policy. This research proposed to analyze the historical position of litigation concerning illegal immigration and the education of immigrant children. This study was significant as an attempt to recommend policy inclusions for the state of Florida on the education of the children of undocumented immigrants.


Statement Of The Problem

Since the 1982 Supreme Court decision in Plyler,3 which required free elementary and secondary education for all children residing within a given state, the numbers of immigrants both legal and illegal arriving in the state of Florida increased. An assessment of the cost of providing special educational programming, along with meeting equity provisions and equality concerns was essential.

With the increase of undocumented immigrant students in mind, the question of the necessity for an illegal immigrant education policy for the state of Florida and the ethical reasoning behind the education of the undocumented student was of interest. A review of some American beliefs on education during the early twentieth century was included.







3 Plyler v. Doe, 457 US 202 (1982).






4

History

Opposition to the entry of foreign paupers and aliens "likely at any time to become a public charge" dates from Colonial times.4 The colony of Massachusetts enacted legislation in 1645 prohibiting the entry of paupers and in 1700 excluding the infirm unless security was given against their becoming public charges. From these beginnings, the United States continued to enact legislation designed to regulate the number of immigrants based on the countries of origin. In so doing, and by not enforcing the legislation, controlling the borders, or monitoring the illegal immigrant population, the United States created an enormous influx of "strangers-in-need". There was a call for legislative policy to regulate not only numbers of immigrants, but also to see if and how the immigrants who were here would be eligible for public services. Educating the children of all immigrants, legal and illegal, became costly for some states due to federal legislation. Federal policy was needed to assist and support these states in following its mandates. States, such as Florida, with the highest immigrant populations, needed an effective policy regarding the education and inclusion of immigrant children.


Historical Immigration Legislation

The United States did not have an immigration policy per se for most of the nineteenth century. A bar against the landing of "any person unable to take care of himself or herself without becoming a public charge" was included in the first general federal immigration law, the Chinese Exclusion Act of August 3, 1882,5 which


4 U.S. House of Representatives Ways and Means Committee Print: 104-12 [Green Book] "Appendix J. Noncitizens" The Personal Responsibility and Work Opportunity Reconciliation Act and Associated Legislation, 1996, (25 February 1997).
5 Chinese Exclusion Act, ch.126, 22 Stat.58, 1882 (formerly codified in scattered parts of 8 U.S.C. ch.7).





5

established broad legal limits to immigration by excluding Asian immigration. The 1882 law also solidified the primacy of the federal government to determine immigration law and policy.6 This prohibition was carried forward in the Immigration Act of 1917, and was recodified in the Immigration and Nationality Act both when it was enacted on June 27, 1952 and again in 1990.7

The controversy over illegal immigration began in 1875 when the U.S.

established its first law restricting immigration, which prohibited the entrance of convicts and prostitutes. Since that time, the U.S. struggled to control its borders. Every year thousands more found passage in, adding to the already five million immigrants who had entered the country illegally or overstayed their visas.8

From 1880 to 1920, 23,465,000 people immigrated to the United States; the great majority of these immigrants were from southern and eastern Europe.9 Public agitation grew steadily during this period to limit further immigration, despite the opposition of business interests.'o





6 Federal power over immigration lies in the United States Constitution: "'To establish an uniform Rule of Naturalization," U.S. Constitution Art. I, 8, cl. 4.
7U.S. House of representatives Ways And Means Committee Print: 104-14 [1996 Green Book] "Appendix J. Noncitizens" The Personal Responsibility and Work Opportunity Reconciliation Act and Associated Legislation, 1996, (25 February 1997).
9 Kathleen Vail, "No Entry", The American School Board Journal 183, no. 9 (September/96 1996): 22-25. 9 Marion T. Bennett. American Immigration Policies: A History, 15 (1963) quoted in Gregg Van De Mark, "Too Much of a Good Thing," Washington Law Journal 35, no. 3 (Spring 1996). 'o The main concerns of those pushing for immigration controls were the assimilability of the new immigrants, their sheer numbers, and their effect on the nation's politics, language, and culture. Thomas A. Alienkoff and David Martin, Immigration: Process and Policy, pp. 1-42 (interim 2d ed. 1991) quoted in Van De Mark, Washington Law Journal 35.






6


The Quota Act of May 19, 1921" created a National Origins plan under which each country had an immigration quota in proportion to that nation's past contribution to the population of the United States. The Act based the quotas on the 1910 Census of Population and allowed 357,000 immigrants into the United States each year.'2

The 1924 Immigration Act used the 1890 census of different ethnic groups in the United States as a basis for establishing a national origins quota for emigrant-sending nations."3 A basic idea reflected in the 1924 Act was the fear that heavy immigration from southern and eastern Europe discriminated against current residents of the United States (largely descended from northern and western Europeans) by diluting the ability of current residents to determine the nation's destiny. The 1924 Act maintained the 1921 exemption for the independent countries of the Western Hemisphere from any quotas.'4 The 1890 census served as an interim provision until Congress established the final national origins system in 1929.'5 Thereafter, Congress set the national origins quota at one-sixth of one percent of the 1920 population to arrive at a base immigration figure of 153,714.16 The 1920's legislation effectively stopped large-scale immigration to the United States for forty years.

Confidence in American institutions, the realities of World War II alliances, and post-war foreign affairs combined to challenge the basis of America's immigration Quota Act, ch.8, 42 Stat. 5 (1921) (formerly codified at 8 U.S.C. 229-31). 12 Ibid.
'3 The Immigration Act of 1924, ch. 190, 43 Stat. 153 (1924) (formerly codified at 8 U.S.C. 201-204). 14 Bennett, American Immigration Policies, p 47.
15 Act of July 1, 1929, ch. 306, 45 Stat. 400 (formerly codified at 8 U.S.C. 204c). 16 Ibid.






7


policy."7 Congress liberalized Asian immigration during and shortly after World War II.18 On June 27, 1952, the McCarran-Walter Act19 effectively altered the immigration policy of the United States by removing racial bias from the setting of national origin quotas, since particular immigrants could not be excluded on account of race. The 1952 Act retained the 1920 quota base.20 Senator McCarran maintained that the nation had always been besieged by immigrants and that ending the national origins system would cause further conflict in an ethnically altered United States.2' McCarran wanted to end racial discrimination in immigration admissions, but he felt that the United States could best serve its mission in the world by remaining true to its culture and by assimilating non-Europeans very slowly.22 The justifications of cultural unity, which had so concerned Congress, never dominated immigration debates after 1952.

The confidence and determination to confront America's history of racism

continued with renewed fervor during the decade of the 1960s. Congress passed such







17 Gregg Van De Mark, Too Much ofa Good Thing, Washburn Law Journal 35, no. 3 (Spring 1996) . 18 Congress repealed the Chinese Exclusion Act by the Act of December 17, 1943 (ch. 344, 57 Stat 600 (formerly codified at 8 U.S.C. 262-97, 299)).

19 McCarran-Walter Act, ch. 477, 66 Stat. 1633, 8 U.S.C. 1101, 1952. 20 Ibid.
21 CONGRESSIONAL RECORD, pt 4, p. 5330 (1952). 22 Ibid.






8

legislation as the 1964 Civil Rights Act23 and the 1965 Voting Rights Act24 in response to the new activist mood.2s

The 1965 Immigration Act26 abolished the old national origins formula. Each country outside of the Western Hemisphere received unlimited visas for relatives of citizens and 20,000 visas for ordinary immigrants.27 The Act set quotas on immigration from the nations of the Western Hemisphere for the first time. The 1965 Act also offered a first-in-time, first-in-right system for 120,000 immigrants not related to United States citizens.28

Immigration resulting from the 1965 Immigration Act altered the demographic makeup of the United States over a mere thirty-year period. In 1960, one out of ten Americans was non-white." According to the 1990 census, one out of four Americans claimed to be non-white.30 The United States no longer consisted of an overwhelming white majority, with significant minorities of blacks, Hispanics and to a lessor and more localized degree, American Indians and Asians.



2 Civil Rights Act of 1964, Pub. L. No. 88-352, 78 Stat. 241. A Voting Rights Act of 1965, Pub. L. No. 89-110, 79 Stat. 437. 25 Exec. Order No. 11,246, 3 C.F.R. 339 (1964-65). 26Immigration Act of 1965, Pub. L. No. 89-235, 79 Stat. 911 (codified as amended at 8 U.S.C. 1-14354 (1994).
27 Bill Ong Hing, Making and Remaking Asia America through Immigration Policy 1850-1990, pp. 38-41 (1993); quoted in Van De Mark, Too Much of a Good Thing. 28 Ibid.

29 Bureau of the Census, U.S. Department of Commerce, Census Population of 1960, Characteristics of the Population, pt. 1, at 145, tbl. 44 (1964).

3 Bureau of the Census, U.S. Department of Commerce, 1990 Census of Population, General Population Characteristics, 323 tbl. 253 (1992).






9

Immigration Policy

Congress made several substantive changes to immigration policy after 1965. The patterns of immigration and the policy considerations relating to it in the 1970s resembled, in some respects, those of the decade of the 1950s after the enactment of the Immigration and Nationality Act.31 In both decades, the entry of aliens outside the provisions of the basic law--both illegally as undocumented aliens, and legally as refugees--was increasingly the dominant pattern in immigration and the basis for the major issues confronting Congress.

Legislative response to the issue of refugees in 1980 with the Refugee Act of 1980,3 and undocumented aliens in 1986, the Immigration Reform and Control Act,33 was followed in 1987 by a shift in congressional attention to legal immigration.34 The Immigration Reform and Control Act of 1986 (IRCA) granted amnesty to certain illegal immigrants and mandated employer sanctions for those hiring illegal immigrants as a way to deter future arrivals.35

The Immigration Act of 199036 increased the number of available immigrant visas to 700,000 from the prior limit of 490,000 for fiscal years 1992-93 and 1993-94, and to 675,000 thereafter. Therefore, proposals to cut immigration by one-third did nothing




31 McCarran-Walter Act, ch. 477, 66 Stat. 163, 8 U.S.C. 1101 et seq. as amended throughout 8 U.S.C. 32 Refugee Act of March 17, 1980, Immigration and Nationality Act, [101(a)(42)(A)]. 33 Immigration Reform and Control Act, Pub. L. 99-603, 100 Stat. 3359 (1986). 34 "The 1970s Through 1990s: Immigration Issues, Review, and Revision" March 1996. 35 Immigration Reform and Control Act, Pub. L. 99-603, 100 Stat. 3359 (1986). 36The Immigration Act of 1990, Pub. L. No. 101-649 111-24, 104 Stat. 4978-97 (1990).






10

more than re-establish the immigration levels of the decade of the 1980s, the highest ever in the country's history up to that time.


Immigration Statistics

In 1994, the Immigration and Naturalization Service (INS) released detailed

estimates of the undocumented immigrant population in the United States as of October 1992. Those estimates were useful for a variety of purposes, including planning and policy development at the national and state level, evaluating the effects of proposed legislation, and assessing the fiscal impact of undocumented immigration. Between 1994 and October 1996, the INS revised and updated those estimates. As of October 1996, an estimated 5 million undocumented immigrants were residing in the United States. An estimated 350,000 undocumented aliens lived in Florida. The undocumented immigrant population was estimated to be growing by about 275,000 each year, which was about 25,000 lower than the annual level of growth estimated by the INS in 1994.37

California was the leading state of residence with 2 million, or 40 percent of the undocumented population. The seven states with the largest estimated numbers of undocumented immigrants in 1994 including California were Texas (700,000), New York (540,000), Florida (350,000), Illinois (290,000), New Jersey (135,000), and Arizona (115,000). These seven states accounted for 83 percent of the total undocumented population in October 1996.38

From 1960 to 1997, the foreign-born population increased from 1.3

million to 8.1 million in California, and from 0.3 million to 2.4 million in Florida, and 37"Illegal Alien Resident Population" 23 November 1997. 38 Ibid.









from o.3 million to 2.2 million in Texas.39 The foreign-born population in these three states combined rose from 1.9 million to 12.6 million, and the increase of 10.7 million represented 67 percent of the growth of the foreign-born population in the United States. During the period from 1960 to 1997, these three states accounted for 41 percent of the growth in total population."


Illegal Immigration

The U.S. Supreme Court in 1982, by a 5 to 4 ruling, invalidated a 1975 Texas

State Statute which withheld from local school districts any state funds for the education of children who were not "legally admitted" into the United States, and which authorized local school districts to deny enrollment to such children.41 The ruling in Plyler v. Doe 42 held that illegal immigrant children were entitled to an education since they were not responsible for their immigration status and were covered by the Equal Protection Clause of the Fourteenth Amendment to the constitution, which prohibited states from denying any person equal protection under the laws.43

The court recognized the importance of education to individuals and our nation

and concluded that the denial of education to this class of students could be justified only if it advanced a substantial state goal. The state offered several justifications for its law,



39 U.S. Census Bureau, Profile of the Foreign-Born Population of the United States: 1997.

4 Ibid.
4' Texas Education Code Ann 21.031 (Vernon Supp.1981). 42 Plyler v. Doe, 457 U.S. 202 (1982).

43 Joseph Perkins, The San Diego Union-Tribune, June 11, 1997, B-9, pg 2. Constitutional scholars said that neither Congress nor the state legislatures intended for the 14" Amendment to apply to the children of undocumented immigrants. That was because, when the amendment was originally proposed 130-some years ago, the United States had a defacto "open border" policy. There could be no illegal immigration.






12





such as preserving the government's financial resources, protecting the state from an influx of illegal immigrants, and maintaining a high quality of education for resident children. The Supreme Court, however, was not convinced that the law in question advanced these objectives. The Court reasoned that any funds saved by denying education to illegal alien children would be insignificant compared to the costs to the children, the state, and our nation. The Court noted that many of these children would remain in the United States and, if uneducated, would ultimately place a burden on our society. Finding no "rational justification for penalizing these children for their presence within the United States, over which they had no control," the Court struck down the law.44 As a result of this decision, public school districts were obligated to educate immigrant children residing with their parents or guardians within a district's boundaries, even if the families had entered the country illegally.

Public schools, however, did not have to admit non-resident immigrants tuitionfree. In 1983, the Supreme Court upheld a state law allowing local school boards to deny tuition-free schooling to any minor who lived apart from a parent or legal guardian for the primary purpose of attending public school.45 Thus, unlike immigrant children who came to the U.S. with their parents (even illegally), immigrant children who left their families to live in the United States for educational purposes were not entitled to free schooling.




" Ibid.
45 Martinez v. Bynum, 461 U.S. 321 (1983).






13


Table 1-1 Estimated Illegal Immigrant Population for Top Twenty Countries of
Origin and Top Twenty States of Residence: October 1996

Country of Origin Population State Of Residence Population All countries 5,000,000 All states 5,000,000 1. Mexico 2,700,000 1. California 2,000,000 2. El Salvador 335,000 2. Texas 700,000 3. Guatemala 165,000 3. New York 540,000 4. Canada 120,000 4. Florida 350,000 5. Haiti 105,000 5. Illinois 290,000 6. Philippines 95,000 6. New Jersey 135,000 7. Honduras 90,000 7. Arizona 115,000 8. Poland 70,000 8. Massachusetts 85,000 9. Nicaragua 70,000 9. Virginia 55,000 10. Bahamas 70,000 10. Washington 52,000 11. Colombia 65,000 11. Colorado 45,000 12. Ecuador 55,000 12. Maryland 44,000 13. Dom. Republic 50,000 13. Michigan 37,000 14. Trinidad/Tobago 50,000 14. Pennsylvania 37,000 15. Jamaica 50,000 15. New Mexico 37,000 16. Pakistan 41,000 16. Oregon 33,000 17. India 33,000 17. Georgia 32,000 18. Dominica 32,000 18. District of Columbia 30,000 19. Peru 30,000 19. Connecticut 29,000 20. Korea 30,000 20. Nevada 24,000
Other 744,000 Other 330,000
Source: Illegal Resident Population, Immigration and Naturalization Service, 1997.


Estimating the size of a hidden population was inherently difficult. The
figures presented here reflect the size, origin, and geographic distribution of the undocumented immigrant population residing in the United States
during the mid-1990s. These estimates were constructed by combining detailed statistics, by year of entry, for each component of change that
contributed to the undocumented immigrant population residing within the
state.4







46 "Illegal Alien Resident Population" 23 November 1997.






14

Immigrant Education

An additional Supreme Court decision with implications for immigrant children was Lau v. Nicols, rendered in 1974.47 This case focused on the rights of non-English speaking children and the corresponding duties of public schools to address these students' unique needs. Specifically, Chinese students asserted that the San Francisco public school program violated the equal protection clause of the Fourteenth Amendment and Title VI of the Civil Rights Act of 196448 by failing to make adequate provisions for the needs of students with English language deficiencies. The Court held that the lack of sufficient remedial English instruction violated Title VI, which prohibited discrimination on the basis of race, color, or national origin in institutions with federally assisted programs.49 The court held that equal opportunities were not provided by giving students the same textbooks, teachers, and curriculum. Further, requiring children to acquire English skills on their own before they could hope to make any progress in school made "a mockery of public education."50 Emphasizing that "basic English skill is at the very core of what these public schools teach,""' the Court concluded "students who do not understand English are effectively foreclosed from any meaningful education."52






47Lau v. Nichols, 414 U.S. 563 (1974).

48 Civil Rights Act of 1964, Pub. L. No. 88-352, 78 Stat. 241. 49 42 U.S.C. 2000(d).
* 414 U.S. at 566.
5' Ibid.
52 Ibid.






15


The federal Equal Educational Opportunities Act (EEOA) of 197453 required each public school system to develop appropriate programs "to overcome language barriers that impeded equal participation by its students in its instructional program." While the EEOA stipulated that school districts must provide appropriate assistance for students with English deficiencies, it did not require that such assistance be in the form of bilingual or bicultural education. School districts could satisfy legal requirements by providing remedial English instruction rather than bilingual programs. Each state was responsible for providing a school system whereby all children received an education with no charge for attending school. The federal Equal Education Opportunities Act of 1974 also provided that no state could deny equal education opportunities to an individual because of his or her race, color, sex or national origin. Every person had the right to attend school, unless his or her conduct violated valid rules and regulations.54


Children of Immigrants Projected Change, 1990-2010
10 9
8 8 7 7
6 6 Children of
5 5 Natives
E 4 4 Children of Immigrants
2 2 1 1 0 0
1990 2000 2010 1990-2010 Source: Fix and Passel (1994).

Figure 1-1 School-Age Immigrant Population, 1990-2010 53 Equal Education Opportunities Act of 1974 (EEOA) at 20 U.S.C. 1703.






16

In considering the educational needs of students learning English, a look at the past proved to be judicious. At the turn of this century, a peak time for United States immigration, educational achievement was not the key factor in determining economic success. A strong back and willing hands were as important as the ability to read and write. During that period, it often took three generations for families to move into the American mainstream. Less than 100 years later, manual labor had little economic value. As the value of physical labor diminished, the expectations for effective communication and literacy increased. Students were not only required to have at least a high school diploma, they were required to be fully literate in English, to understand academic subjects and to know how to use technology. Instead of waiting generations for their families to acculturate to the mainstream, students were expected to assimilate into the mainstream within a matter of a few years.55

The relationship of immigration and education became a heated policy issue in 1994 due to a California proposal to deny taxpayer-financed education to illegal alien children. California's Proposition 187,56 which restricted government funded programs from serving illegal immigrants, passed in 1994 by a significant majority. A federal judge froze implementation of the provision in November 1997. Judge Mariana Pfailzer declared that it violated both the Constitution and the Personal Responsibility and Work Opportunity Reconciliation Act of 1996. The judge cited as unlawful the initiative's major sections--those barring undocumented immigrants from receiving publicly funded 54 Ibid.

55 Sandra H. Fradd and Okhee Lee, eds., 1998. Creating Florida's Multilingual Workforce, Miami, Custom Copy and Printing.
56 57 Cal. App.4th 693.






17


education, social services and health care--along with complementary provisions mandating that local law enforcement authorities, school administrators, social workers, and health-care aides turn in "suspected" undocumented immigrants.57 Other opponents of the measure argued that it was unconstitutional, citing the 1982 Plyler v. Doe Supreme Court decision.58 That decision centered on the view that the state had enacted an immigration-related law, whereas the federal government, which had not acted on the issue, had exclusive jurisdiction.59


Societal Impact

One of the most controversial political and economic issues in the United States at the time was the influence immigrants entering the country had on society. Some people categorized immigrants as an uneducated, unskilled burden on our economy that took advantage of many of the government funded programs established for the benefit of U.S. citizens. Opponents of the U.S. policy on immigration believed that "drastic steps" needed to be taken to curb the number of immigrants entering the United States.60 Politicians expressed their willingness to support measures that would close the borders and deny children of undocumented workers an education. After California voters passed Proposition 187,61 other states attempted to restrict undocumented alien access to government-funded programs.62


57 "Federal Judge: Proposition 187 Unconstitutional. Stage Set for Appeal of Anti-immigrant Initiative," Los Angeles Times, 5A, November 15, 1997.
58 Plyler v. Doe, 457 U.S. 202 (1982).

59 Chinese Exclusion Act, ch.126, 22 Stat.58, 1882 (formerly codified in scattered parts of 8 U.S.C. ch.7). 60 57 Cal. App.4" 693.
61 Ibid.






18

Historically, federal and state governments worked to keep students 'in' school, rather than 'out.' But as part of the wave of anti-immigrant sentiment, several proposals were made to bar undocumented immigrant students from attending public schools. California's victorious 1994 ballot measure, Proposition 187, barred undocumented students from the public schools.63

The Gallegly Amendment (1996)6 passed in the U.S. House of Representatives as part of an immigration-reform bill and gave states the authority to limit access. A portion of the Gallegly amendment read:

"Congress declares it to be the policy of the United States that ...
aliens who are not lawfully present in the United States not be
entitled to public education benefits in the same manner as United
States citizens and lawful resident aliens..."65

Supporters of the Gallegly Amendment argued that America's education system, like other social-service programs, attracted a disproportionate number of immigrants and that the cost of educating such children was too high in an era of tight school budgets.66 Opponents of the measure denounced it as cruel; hundreds of thousands of children could potentially be turned away at the schoolhouse door.67




62 Abel Carmona, Dispelling Myths About Immigrant Students, IRDA Newsletter, May 1996 .
63 Ibid.

6 H. R. (2022).
65 Charles Levendosky, "The Politics of Turning Children into Victims," Casper (Wyo.) Star Tribune, May 1996 October 1998.
6 "Illegal Immigrant Children: In or Out of Public Schools?" Education Week, April 1996, . 67 Carmona, Dispelling Myths About Immigrant Students.






19

The immigrant population was similar to the United States population in that it included people with varying degrees of education. Some had less than eight years of formal education and others had doctorates. The educational level of immigrants was higher than those of the past and continued to improve. On average, the proportion of immigrants with post-graduate degrees was greater than the proportion of people with post-graduate degrees in the native population. 68

Just as the privileges of our society afforded to its educated people served as incentives for people to become educated, it also served as an incentive for some to emigrate here, even those who were from countries as prosperous. As a consequence of this phenomenon, the United States experienced a growth in our pool of people who excelled in such technological fields as engineering, mathematics and science.69 With this growth, the United States had the potential of increasing its productivity and expanding into frontiers in many fields of study, particularly in technology and science.70

A study of immigrant middle school students," made available by Johns Hopkins University, reported that the children of immigrants overwhelmingly preferred English to their parents' native languages. The initial study was done in 1990 and 1991.72


6 Julian Simon, Immigration: The Demographics and Economic Facts. Washington, DC: Cato Institute and National Immigration Forum, 1995.
69 David W. Stewart, Immigration and Education: The Crisis and the Opportunities. New York, Lexington Books, 1993.
70 Carmona, .
71 James M. McPartland, Project Director. Center for Research on the Education of Disadvantaged Students (CDS), Project # 7126: The Adaptation of Immigrant Children in the American Educational System. John Hopkins University (1997).
72 Ruben G Rumbaut, (August 1990). Immigrant Students in California Public Schools: A Summary of Current Knowledge. CDS Report No. 11, and Alejandro Protes (1991), Characteristics and Performance of High School Students in Dade County (Miami) Schools. CDS Report No. 24.






20


The results of this study indicated that the children of immigrants were unlikely to develop into an underclass, as some experts feared, cut off by academic failure and an inability to speak English. But the researchers also found it was uncertain how well the children of immigrants, who made up 20 percent of all children in the U.S., would do in college and in the job market.73

The research team, led by sociologists Ruben Rumbaut of Michigan State

University and Alejandro Protes of Princeton University, first interviewed 5,200 eighth and ninth graders in San Diego and South Florida in 1992. They located 82 percent of the initial sample for a second interview in 1995 and 1996.74

The research found that the children of Chinese, Indian, Japanese and Korean parents got the best grades, an average of A's and B's. English speaking West Indians had lower grades, Cs and C+, while Latin American and Haitian youths performed most poorly, with averages that were slightly higher or lower than a C.75

But a few groups defied what would have been expected based on their

socioeconomic status. The children of Southeast Asian refugees, who came from the most impoverished background and whose parents were among the least educated, were also among the least likely to drop out and had above average grades. And the children of Cuban immigrants, who were from average to above-average socioeconomic backgrounds, had the highest dropout rates and among the lowest grades, the survey reported. The Cuban children, who belonged to the dominant group in Metropolitan



3 Ibid.
74 Ibid.
75 Ibid.






21

Miami, faced less discrimination than any other group in the survey. The children of Cubans did worse academically than the children of Mexicans, who were one of the poorest and were by far the largest immigrant group in the United States. On the issue of language, the survey found while nine out of ten of the youths surveyed spoke a language other than English at home, almost exactly the same proportion, 88 percent, preferred English by the end of high school.76


Fiscal Responsibilities

Schools were caught in a struggle between the needs of immigrant children who filled their classrooms and the growing number of parents and taxpayers unwilling to expend more money for bilingual instructors to teach these students and buildings to house them. According to The Center for Immigration Studies, it costs 50 percent more to educate a child with limited English proficiency than a child with fluency in English.77

To help cover the cost of educating these children, the federal government gave about $30 million a year through the Emergency Immigration Education Act of 1984.78 But educators and politicians believed the act was under-funded. In 1994, California, Texas, New Jersey, New York, and Florida sued the federal government for billions of dollars to cover the costs of educating undocumented immigrant children. The court eventually rejected the state cases.79



76 Ibid.
7 Vail, "No Entry" pp. 19-25.
78 The Emergency Immigrant Education Act (EIEA), (Title IV, Part D of the Elementary and Secondary Education Act), as amended, (20 U.S.C. 3121-3130) (expired September 30, 1999). 79 Vail, "No Entry" pp. 19-25.






22


The State of Florida was unable to prove to the federal government that illegal immigration in Florida had a significant impact. Florida was forced to rely on speculation on some of its figures, which weakened its case. The burden of proof of additional costs due to illegal immigrants remained with the state.80

Florida's education costs for both legal and illegal immigrants in 1993 were $517.6 million, which was up 24 percent from 1992's expenditure of $418.5 million. The state spent $254 million alone on the English for Speakers of Other Languages (ESOL) program.81

Education for illegal aliens totaled $180.4 million in 1993. This number

represented another 24 percent increase in costs from the previous year when illegal alien education was $145.9 million. The increase was due to the rise in numbers of illegal aliens arriving in Florida.82

According to Kathleen Vail, an assistant editor of The American School Board

Journal, much of the increase in public school enrollment was due to rising immigration. This mounting enrollment strained schools that were already dealing with the recent influx of immigrant children. The immigrant children taxed the schools further by needing bilingual teachers and language programs. The schools were forced to spend scarce resources on immigrant students. Immigrant families tended to have larger






8o John Digrado, "News", Daily Bruin, May 1996, (October 1998). 81 "Florida: Social Policy Issues," Immigration and Florida: Social Policy Issues, 1997, (1 February 1998).
82 Ibid.






23

families than Americans, which meant more children per family in need of bilingual education and special services.83

As of 1993, approximately 60 percent of all foreign-born people residing in the United States came to this country during the decade of the 1980's.84 About 9 million immigrants came during those years, increasing the U.S. population by 6 percent. The children of these immigrants, about 2 million of them, enrolled in school, increasing enrollment in English as a Second Language classes by 50 percent. Five states had carried the burden of this wave, according to Rand. More than 70 percent of all immigrants lived in California, New York, Texas, Florida, and Illinois.85

The Center for Immigration Studies estimated an additional 50 percent cost to educate a student with limited English proficiency than one who was fluent in English. But opponents in the immigration debate disagreed over whether immigrant families produced enough tax revenue to pay for the extra services they received. Immigrantrights groups said that immigrants, including illegals, paid enough taxes to cover the costs of educating their children. According to the Urban Institute, local, state, and federal governments spent some $42.9 billion a year in services for immigrants, including $11.8 billion for educating legal and illegal immigrant children. This expense was more than offset by the taxes legal and illegal immigrant families paid--$70.3 billion a year, according to the Urban Institute. But in 1992, Rice University professor Donald Huddle put the cost of educating immigrants at $16.4 billion--and the total cost for services for 83 Vail, "No Entry" pp. 19-25.

4 Lorraine M. McDonnell and Paul T. Hill, Newcomers in American Schools: Meeting the Educational Needs of Immigrant Youth, Santa Monica, Calif.: RAND, MR-103-AWM/PRIP, 1993. 85 Ibid., p. 22.






24


immigrants at $62.7 billion. In the study, funded by the Carrying Capacity Network, Huddle said immigrants paid only $20 billion in taxes.86

There was no comprehensive rule that restricted direct federal assistance or

federally funded assistance on the basis of immigration status. This was true both with respect to legal permanent residents who entered under the admission system of the Immigration and Nationality Act of 198687 and to aliens who entered or remained in violation of the law.88

Those restrictions that did exist had been enacted on a program-by-program basis, beginning in the 1970s. Most existing restrictions denied assistance to aliens who were here without legal permission.89

Immigration policies were made at the federal level and addressed broad issues such as quotas and enforcement of immigrant requirements. Immigrant policies, on the other hand, were made at the state level and focused on immigrants already residing in the United States. Immigrant policy makers dealt with how to integrate immigrants into the American population and assist them with public benefits during the transition."

There were three basic policy issues concerning education and immigration:

education of illegal alien children, the volume of legal immigration and the strain it put



86 Donald Huddle 1994, "The Net National Costs of Immigration in 1993" June 1994. This was a comprehensive nationwide study of the fiscal impact of immigration. 87 Immigration Reform and Control Act, Pub. L. 99-603, 100 Stat. 3359 (1986). 88 McDonnell, and Hill, RAND, MR-103-AWM/PRIP, 1993. 89 Ibid.
90 Rocio Del Sagrario Toriz , "Federal and State Responsibility for Undocumented Immigration," Berkeley McNair Journal Three, no. Summer 1995 (1995) .






25

on the schools and public budgets, and the admission of foreign students to U.S. universities as a route to immigration status.91


Research Question

In order to investigate this problem, the following questions were addressed. Does the state of Florida have a legal, ethical, and moral obligation to educate the children of undocumented immigrants? Does the state require a policy directed specifically to the education of these children? What should Florida's policy be on educating the children of undocumented immigrants?


Methodology

The traditional method of Policy Analysis/Legal Investigation was utilized to identify judicial reasoning relative to established legal principles and applications in relevant cases involving undocumented immigrant education. The procedure included identifying relevant constitutional amendments, federal acts, state statutes, and rules and regulations. Relevant cases were compiled, and judicial reasoning in each case was analyzed.

To address the purposes of the study, there was a need to develop suggested sample policy inclusions for implementation by all school districts within the state of Florida. Several methods of legal research were employed. Specifically, policy study and traditional legal research were appropriate. To accomplish this task, it was necessary and prudent to research the status of current policies as well as research the appropriate laws and rulings.


91 "Immigrants and Education," in Fair , May 1997.






26

Legal research, as generally defined, was a systematic investigation, which

involves interpreting and explaining the law.92 Historically, legal research has relied on precedent.

The methodology utilized in this study was not only to review the previous and current policies, but also to build a foundation for designing a model for undocumented immigrant education policy for the state of Florida.


Definition Of Terms

1) Undocumented immigrant: designates persons who are correspondingly
referred to as "illegal immigrants" or "illegal aliens." Congressional Research
Service defines illegal aliens as persons who have violated immigration law.

2) Fundamental Rights: those rights explicitly or implicitly provided by the
federal constitution such as the right to exercise First Amendment freedoms.
The courts have found that education is a not fundamental right.

3) Procedural due process: guarantees procedural fairness where a person's
property or liberty is deprived by the government.

4) Suspect Classification: "deserving of special scrutiny" include those based on
race, national origin, religion, alienage, non-residency".

5) Undocumented aliens: persons who are in the United States in violation of the
Immigration and Naturalization Act. They either entered this country illegally
or entered legally, then violated conditions of entry.

6) Undocumented alien children: children who live with their parents who are
residing in the United States illegally; children whose parents reside in another country, and the children are residing in the United States with
someone who is not their "parent, guardian, or person having lawful control"
for the sole purpose of attending free public school.

7) Newcomer: a recent immigrant, either legal or illegal.






92 Charles J. Russo, Legal Research: The 'Traditional Method, 28 NOLPE Notes 2 (October 1993).






27


Limitations

This study provides an analysis of previous statutes, court cases, school board policies, and attorney general opinions related to the education of undocumented alien children. As the members of the courts change, changes could develop in the legal bases providing the foundation for this study.

Further limitations are listed below.

1) It is unlawful to ask for proof of legal status from a student.

2) Discussion of education expenditures include K-12 but not post-secondary.

3) Data available are estimates from the total population.

4) Most recent Census data is for 1990 (with estimates for 2000).

5) The transient nature of the target population.

6) Local governments do not document U.S. residency status of local service
consumers, in part, because local residency is a requirement for local service
eligibility: U.S. residency status is not a program eligibility requirement.

7) Statutory and other data collection requirements on Newcomers for state and
local entities are incomplete, unverified, sometimes non-mandatory, of
relatively low priority, include no provisions for centralized reporting, and are
under-utilized by state and local governments.


Design Of Study

The framework for this study was provided by legal doctrines that can be

identified in the U.S. Constitution, federal and state case law, statutes, and rules and regulations, and the Florida Constitution. The study was an examination of law and policy as it related to the education of undocumented immigrant children. It looked at estimates and percentages of undocumented alien children and the educational programs





28


they require. Data were retrieved from the Internet and/or public documents and publications.

1) The study examined historical constitutional issues involved in educating
undocumented alien children in order to demonstrate previous policy.

2) The study analyzed the United States Supreme Court ruling in Plyler v. Doe
(1982) in order to understand the current paradigm.

3) The study examined California's Proposition 187, and its implications for
legislative policy for the state of Florida.

4) The study looked at some of the ethical and moral considerations of educating
undocumented alien children in order to determine the obligations of the state
of Florida.

5) The study suggested a feasible policy on undocumented immigrant education
for the state of Florida.


Organization of the Chapters

Chapter I provides introductory information, a statement of the problem, and the significance, methodology, limitations, and design of the study. The remainder of this study is organized in the following manner. Chapter 2 presents an historical review of immigration legislation through 1982. Chapter 3 continues with the historical review and looks at some illegal immigration statistics for the United States and the state of Florida. Chapter 4 presents some financial and ethical issues related to the education of undocumented immigrant children. Using some historical information, it also puts forward the question of what would the political atmosphere regarding the education of immigrant children would be like if the Plyler decision had been different. Chapter 5 suggests inclusions for a practical immigrant education policy for the state of Florida, including the undocumented immigrant student.















CHAPTER 2
HISTORICAL REVIEW OF IMMIGRATION LEGISLATION


Introduction

This chapter discusses immigrants and immigration and examines U.S. immigrant legislation through 1982. It looks at the origins of immigration and immigrant education policies and the reasons they came into existence.


Immigration Legislation

The extraordinary migrations of peoples from Europe and Asia to the Americas, Australia, and Africa during the last hundred years, not as colonists but as immigrants to countries already politically established, was one of the noticeable and far-reaching phenomena of the economic age. The United States, as the country that received these immigrants in greatest numbers, experienced the greatest perplexity over the problems this immigration created.

The United States continued to be an appealing place to live. If it were less

desirable, perhaps residence in the U.S. would not need to be legally restricted. But, in the closing years of this century, immigration levels were at an historic high, and the demand remained as great as it had ever been. The assumption behind U.S. citizenship and immigration law was that we could not embrace all who wanted to make this country their home. There needed to be some standard for admission and exclusion. So whom



29






30


could we admit? This was essentially the question immigration law and policy had to address. States could not make their own policies on immigration admissions. Immigration policy was the overarching responsibility of the national government, chiefly, the legislative branch.'

American immigration policy was alleged to rival the federal tax code in its complexity. Federal immigration laws, beginning with the act of 1875, served three general purposes: to deny admission, to facilitate entrance for qualitative reasons and to limit the number of entrants.2

The power of a nation to deny admission of a foreigner to its territory was a right under international law that had been exercised in all times. Complete exclusion of foreigners and the denial of free communication with foreign nations, however, had been treated as an act of unfriendly or hostile character, and against it nations have applied forceful methods. In this manner, the foreign exclusion policy imposed upon China by the Manchu Dynasty was broken by European nations, even at the cost of war; and in 1854 the United States, by a naval demonstration by Commodore Perry, coerced the government of Japan into abandoning its policy of non-communication with foreign nations, which had been in place for nearly 250 years.3

Immigration into the United States had passed through several phases. Prior to

1880, immigration consisted almost exclusively of peoples of northern Europe, who were 1 James G. Gimpel and James R. Edwards, Jr., The Congressional Politics of Immigration Reform, Boston, Allyn and Bacon, 1999.
2Ibid.

3 The Lincoln Library of Essential Information 35" ed., s.v. "Immigration." Frontier Press: Columbus, Ohio, (1972).






31

the original settlers of the United States. After that date, immigration from northern Europe declined, while that from southern Europe and from Russia rapidly increased. This so-called "new immigration" produced a change in the American attitude toward unlimited immigration. Until World War I, the immigration laws were designed only to exclude certain undesirable categories, including the feeble-minded, insane, epileptics, sufferers from certain contagious diseases, paupers, criminals, prostitutes, polygamists, anarchists, and those convicted of, or admitting to, crimes or misdemeanors "involving moral turpitude." The importation of labor under contract was also forbidden.4

Asiatic immigration was restricted, first, by the Chinese Exclusion Act of 1882,5 re-enacted in 1892 and in 1902, whereby all immigration from China, except students, merchants, and a few other classes, was forbidden.6 Not until December 1943, was the exclusion law repealed, and the Chinese placed on the same footing as other immigrants. After 1900, when Japanese immigration into California became notable, an exclusion league was organized in that state and agitation was initiated to secure legislation forbidding the admission of Japanese. In 1907, when an immigration bill restricting the admission of Japanese and Korean laborers was introduced into Congress, the president secured in its place the Congressional authority to suspend Japanese and Korean labor immigrants coming from our insular possessions or from Canada or Mexico. An agreement was made between the United States and Japan-the so-called "gentlemen's


4 Ibid.

5 Chinese Exclusion Act, ch. 126,22 Stat.58. 1882.
6 The Lincoln Library of Essential Information.






32


agreement"--whereby the latter government undertook to limit, by the refusal of passports, the entrance of laborers into the United States.7

In 1924, the United States Congress passed an act8 that reduced annual

immigration to 2 percent of the number of foreign residents in 1890. A minimum of 100 was accorded to each country. This law was replaced in 19659 by a measure phasing out the quota system by July 1, 1968. It provided for a total permissible immigration of 120,000 yearly from independent countries of the Western Hemisphere and 170,000 from all other countries, but not over 20,000 from any one country. Preference was given to members of professions or those having special talents or education. In addition, immediate relatives of citizens could be admitted without limit, including minor children, spouses, and parents. No previous law had limited immigration from the Western Hemisphere.'1


American Immigration Before 1920

Prior to the 1790 Naturalization Rule, the United States did not have an

immigration policy. It did enact laws pertaining to the entry of people into the country, although it was doubtful that these could be considered part of a true immigration policy." The 1790 immigration rule required a two-year residency period combined with 7Ibid.

8 The Immigration Act of 1924, ch. 190, 43 Stat. 153 (1924).

9 Immigration Act of 1965, Pub. L. No. 89-235, 79 Stat. 911 (codified as amended at 8 U.S.C. 1-14354 (1994).

'0 Ibid.

" Gregg Van De Mark "Too Much of a Good Thing," Washburn Law Journal 35, no. 3 (Spring 1996) .






33

a renunciation of foreign citizenship and loyalty. Congress then gave the President the power to deport foreign revolutionaries under a 1798 alien act. In 1802, Congress changed the period required for naturalization to five years.'2

The fight against illegal immigration began in 1875 when the United States

established its first law limiting immigration, which prohibited the entrance of convicts and prostitutes.13 Then in 1882, Congress established legal limits on immigration excluding Asian immigration.'14 The 1882 law also solidified the establishment of the United States Constitution as the supreme law of the land.'5

In 1907, Congress set up an immigration commission (Dillingham Commission) to study the growing immigration concerns of the general public. The main concerns of those pushing for immigration controls were the assimilability of the new immigrants, their sheer numbers, and their effect on the nation's politics, language and culture.'6 The commission's investigation-the most exhaustive study of immigration in American history--originated in response to calls to curtail immigration from Japan and southern and eastern Europe. In 1911, the Dillingham Commission eventually recommended restrictive changes to America's immigration laws.'7



'2 Lawrence G. Brown, "Immigration: Cultural Conflicts and Social Adjustments" 267 (1969). 13 Vail, "No Entry" pp. 22-25.

14 Chinese Exclusion Act, ch.126, 22 Stat. 58, 1882. 15 U.S. Constitutions, Art. VI, cl.2.
16 Thomas A. Aleinikoff, and David Martin, Immigration: Process and Policy, 1-42 (interim 2d ed. 1991). '7 Ibid.






34

Immigration Policy After 1920

Congress finally responded to the Dillingham Commission's recommendations ten years later by passing the Quota Act on May 19, 1921.18 The Act created a National Origins plan under which each country had an immigrant quota in proportion to that nation's past contribution to the population of the United States.19 The Act based the quotas on the 1910 census and allowed 357,000 immigrants into the United States each year.20

The 1924 Immigration Act used the 1890 census of different ethnic groups in the United States as a basis for establishing a national origins quota for emigrant-sending nations.21 The primary idea reflected in the Act of 1924 was the fear that heavy immigration from southern and eastern Europe discriminated against current residents of the United States (largely descended from northern and western Europeans) by diluting the ability of current residents to determine the nation's destiny.22 The 1924 Act maintained the 1921 exemption from quotas for the independent countries of the Western Hemisphere." The Western Hemisphere exception resulted from a combination of the economic interests of southwestern ranchers and farmers and a policy of PanAmericanism that emphasized solidarity against the problems of Europe. Thus the 18 Quota Act, ch. 8, 42 Stat. 5 (1921).
'9 Ibid.
20 Ibid.
21 The Immigration Act of 1924, ch. 190, 43 Stat. 153 (1924). 22 Benjamin M. Ziegler, ed., Immigration, An American Dilemma 13 (1953). 23 Marion T. Bennett, American Immigration Policies: A History, 249-55 (1963).






35


1920s' legislation sought to preserve the European heritage as it had developed in the United States without identifying our nation with modem Europe.24

The 1890 census served as a temporary provision until Congress established the final national origins system in 1929.25 Thereafter, Congress set the national origins quota at one-sixth of one percent of the 1920 population to arrive at a base figure of 153,714.26 The 1920s' legislation effectively stopped large-scale immigration to the United States for forty years.

A great reduction in "anti-immigrant hysteria" followed the 1920s' legislation. Yet, the tendency of Americans to intermarry continued among second and third generation Americans.2 These unions became more visible and accepted in the absence of mass immigration. The effects of such personal assimilation spread and gradually became a recognized and comfortable feature of American life. America began to celebrate immigrants rather than fear them.2s

The Statue of Liberty was a famous example of the emerging confidence in American assimilative capacity and the resulting embrace of America's immigrant heritage. Originally a gift from France meant to symbolize the Franco-American relationship, the statue symbolized America's "light of liberty" illuminating the world.29 24 Maldwyn A. Jones, American Immigration, 249-55 (20" ed. 1992). 25 Act ofJuly 1, 1929, ch. 306, 45 Stat.400.

26 John Higham, Strangers in the Land: Patterns of American Nativism 1860-1925 p. 321 (1955). 27 Arthur M. Schlessinger, Jr., The Disuniting ofAmerica" 19, 133 (1993). 28 Ibid.
29 Thomas A. Aleinikoff, The Tightening Circle of Membership, 22 Hastings Const. L.Q. 915 (1995).






36


Not until the 1930s and 1940s (the very lowest period of 20h century immigration-and the beginning of modern American confidence in assimilation) did the Statue of Liberty begin to represent the immigrant in the eyes of most Americans.30

The mechanics of assimilation were very complicated but included such factors as political participation, economic and employment markets, education, residential patterns, economic class, and even factors such as leisure time activities.31 The relationship between the 1920s' legislation and assimilation was necessary because reduced ethnic conflict and emergent American commonality led directly to the theme of confidence in the American assimilative capacity which the United States Supreme Court in Plyler32 took for granted.

The term "family dynamic" was used to hypothesize that the children of

intermarriage help created a "new" culture by assimilating the traits of their parents and relatives with the larger culture to which they were exposed. An important part of this theory was that people who did not intermarry faced pressure to exhibit heightened tolerance and sensitivity toward children of those relatives who did intermarry. Foreignborn immigrants (and "natives") had significant and strong prejudices. Their children had less.

The family dynamic produced various compromises from which "acceptable" social deviation could be judged. This effect accounted for the fact that food, dance, some language, work habits, leisure activities, holidays, etc., tended to be retained longer 30 Ibid.
3' Kenneth L. Karst, Paths to Belonging: The Constitution and Cultural Identity, 64 N.C.L. REV. 303, 331-336 (1986); quoted in Van De Mark.






37


with the family (and often adopted throughout society), while rigid prejudices tended to be discarded as "troublesome." Customs that offended relatives "on the other side," or the public, also tended to be dropped. Family solutions to cross-cultural interactions within the family set out how far one deviated from the established norms. Family members carried these new sensibilities with them in their other social interactions and thus began a ripple effect of tolerance. The family dynamic also included influences from the experiences of all family members in the larger society. Thus, assimilation was not a wholesale swap of one cultural form for another.33 Those who claimed that America had always been a diverse nation, de-emphasized the strong tendency of individuals and families to seek common ground.

Education developed another important nexus between cultural dynamism and value solidification, which benefited from reduced immigration levels. Experts acknowledged the role of education in encouraging individuals to move away from passively accepting predetermined social roles even before the American Revolution.34 Education also solidified core values even during times of demographic change. During the 1920s, concerned Americans began what was known as the "Americanization" movement in education.35 Proponents of the Americanization movement often overlooked minority accomplishments and glossed over majority abuses in their push to 32 Plyler, 457 U.S. at 202 (1982).

33 Bernard Bailyn, Education in the Forming of American Society 49 (1960); quoted in Van De Mark. Ibid.
35 Arthur M. Schlessinger, Jr., The Disuniting ofAmerica, p. 35 (1993).






38


develop a common social nucleus.36 Education helped form new social patterns by providing access to middle class professions and by easing social barriers to the extent that intermarriage was common among middle class young people.37

The forty-year break in immigration protected, supported, and developed a

shifting and evolving "common" culture and, simultaneously, anchored the core values necessary to maintain a workable society. The objectionable racist and eugenic appearance of the 1920s' legislation should not blind us to the positive results of a fortyyear immigration lull.38 Whatever the drafters of the 1920s' legislation intended, it reduced social tensions and sustained the assimilative relationship between intermarriage and core values.


The 1952 Immigration Act

In 1952, the McCarran-Walter Act39 basically altered the immigration policy of the United States. The 1952 Immigration and Nationality Act (official name) retained the 1920 quota base. It removed racial bias from the setting of national origins quotas since particular immigrants could not be excluded on account of race." The Act also: (1) reaffirmed the national origins quota system; (2) limited immigration from the Eastern Hemisphere while leaving the Western Hemisphere unrestricted; (3) established preferences for skilled workers and relatives of U.S. citizens and permanent resident 36 Ibid., p. 53-55.

37 Karst, as quoted in Van de Mark, p. 335.
38 Aleinikoff, The Tightening Circle p. 49.

39 McCarran-Walter Act, ch.477, 66 Stat. 163, 8 U.S.C. 1101 et seq. as amended throughout 8 U.S.C.

0 Ibid.






39

aliens; and (4) tightened security and screening standards and procedures. President Truman vetoed the Act because it did not go far enough in removing racial bias from the immigration process."'

Congress then overrode Truman's veto by a wide margin. In response, President Truman appointed a commission to study immigration after Congress enacted the McCarran-Walter Act. The Commission's report thoroughly re-evaluated the American national identity.42 The Commission concluded that the McCarran-Walter Act was immoral and exclusionist in an era of emerging civil rights and Cold War challenges.43 The Commission decided that American society was assimilated enough to ensure social and political stability."

Senator McCarran expressed a different view and maintained that the nation had always been besieged by immigrants and that ending the national origins system would inject further conflict into an ethnically altered United States. "This nation is the last hope of Western Civilization and if this oasis of the world shall be overrun, perverted, contaminated, or destroyed, then the last flickering light of humanity will be extinguished.'45 McCarran truly wished to end racial discrimination in immigration admissions, but he felt that the United States could best serve its mission in the world by


41Ziegler, An American Dilemma, pp. 105-115.
42 Ibid., p. 109.

04 Ibid., pp. 108-10.

44 Ibid.
45 Congressional Record, pt. 4, p. 5330 (1952).






40


remaining true to its culture and by assimilating non-Europeans very slowly.46 The justifications of cultural unity, which had so concerned Congress, never dominated immigration debates after 1952.


The 1965 Immigration Act

Congress passed the 1964 Civil Rights Act47 and the 1965 Voting Rights Act48 that forbid discrimination against individuals and students who were limited in English language proficiency. Congress then passed the 1965 Immigration Act49, which abolished the national origins formula. Each country outside of the Western Hemisphere received unlimited visas for relatives of citizens and 20,000 visas for ordinary immigrants.50 The 1965 Immigration Act also set quotas on immigration from the nations of the Western Hemisphere for the first time.51 The 1965 Act offered a new system for immigrants not related to United States citizens to emigrate.52

Senator Edward Kennedy maintained that the new immigration laws would not lead to a flood of non-European immigration nor upset the ethnic mix of the United States.53 Attorney General Nicholas Katzenbach reassured doubters by stating, with 46 Ibid.
47 Civil Rights Act of 1964, Pub. L. No. 88-352, 78 Stat. 241. 48 Voting Rights of 1965, Pub. L. no. 89-110, 79 Stat. 437. 49 Immigration Act of 1965, Pub. L. No. 89-235, 79 Stat. 911. 50 Bill Ong Hing, Making And Remaking Asian America Through Immigration Policy, 1850-1990. 38-41 (1993).

51 Immigration Act of 1965, Pub. L. No. 89-235, 79 Stat. 911 52 Ibid.
53 Nathan Glazer, ed., Clamor At The Gates: The New American Immigration, CICS Press, pp. 6-7, (1985).






41


some condescension, that population pressures in what is now termed the Third World would not encourage emigration;54 he could not have been more wrong.55

Congress designed the 1965 Act to provide a level playing field among emigrantsending nations without concentrating on any one region.56 The 1965 Act was not designed to transform the culture or the demographic character of the United States. Yet, the actual effects of the 1965 Act were dramatic.57 Because of the family reunion policies, the first immigrants who came into the United States after the 1965 Act clogged the system through "chain migration" of relatives, who in turn brought in their relatives and created an enormous backlog of people waiting to be processed.58 As a result of the surge in immigration and refugees from Third World nations after 1965, over eighty percent of annual legal entrants to the United States were from Latin America, the Pacific Islands, and Asia.59

Immigration resulting from the 1965 Immigration Act altered the demographic makeup of the United States over a mere thirty-year period. In 1960, one out of ten



5 David Rieff, Los Angeles: Capital Of The Third World, Harcourt Brace: New York, pp. 178-180 (1991). 55 Population growth and migration pressures in the Third World provide the strongest contributions to the immigration problem. See, e.g., United Nations Population Fund, The State Of World Population 1993 (1993).

6 Immigration Act of 1965, Pub. L. No. 89-235, 79 Stat. 911. 57 Almost 3 million Hispanics immigrated during the 1980s, contrasted with about 1.5 million during the 1970s. The Hispanic population increased by 53%. (By comparison the number of non-Hispanic AfricanAmericans increased by 13%. The United States also admitted 315,000 immigrants from Africa and Haiti during the 1980s. Between 1980 and 1990, the Asian-American population grew by 107.8%. Immigration And Naturalization Service, U.S. Department Of Justice 1990 Statistical Yearbook 50 (1991) [hereinafter Statistical Yearbook].

58 Peter Brimelow, Alien Nation: Common Sense About America's Immigration Disaster, p. 81 (1995). 59 Ibid., pp. 77-84.






42


Americans was non-white.6 According to the 1990 census, one out of four Americans claims to be non-white. The United States no longer consists of an overwhelming white majority, with significant minorities of blacks, and to a lesser and more localized degree, Hispanics, American Indians, and Asians.61 Immigration Policy After 1965

Congress made several substantive changes to immigration policy after 1965. The Immigration Reform and Control Act of 198662 (IRCA) granted amnesty to certain illegal immigrants and mandated employer sanctions for those hiring illegal immigrants as a way to deter future arrivals.

The Immigration Act of 199063 increased the number of available immigrant visas to 700,000, from the prior limit of 490,000, for fiscal years 1992-93 and 1993-94, and to 675,000 thereafter. Therefore, proposals to cut immigration by one-third did nothing more than re-establish the immigration levels of the 1980s, the highest ever in the country's history up to that time.

Immigrants arrived through a complicated system comprised of legal immigration, family-based immigration, skills-based immigration, nationality-based visas, refugees and asylum seekers, miscellaneous immigration, and illegal immigration." Third World 60 Bureau Of The Census, U.S. Department Of Commerce, Census Of Population 1960, Characteristics Of The Population, pt. 1, at 145, tbl. 44 (1964).
61 Ibid.

62 Immigration Reform and Control Act, Pub. L. No. 99-603, 100 Stat. 3359 (1986). 63 The Immigration Act of 1990, Pub. L. No. 101-649 111-124, 104 Stat. 4978-97 (1990). 64 Brimelow, Alien Nation, pp. 33-35. Estimates ranged from 300,000 to 500,000 per year:






43


immigrants, because of refugees,65 and above all, family re-unification policies,66 comprised the vast majority of the immigration backlog.67





16

14 12 10













1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 1997
Source: U.S. Census Bureau, Current Population Survey, March 1999. Figure 2-1 U.S. Foreign-Born Population





65 Hing, Making and Remaking Asian America, pp. 12-28. "6 Family re-unification effectively excluded European immigrants because relatively fewer Americans still had close family in Europe. Brimelow, Alien Nation, at 78-84. In contrast, the vast majority of Asian and Latin American immigrants arrived after the passage of the 1965 Act or were descended from post-1965 immigrants. Brimelow, Alien Nation, pp. 78-84. 67 Scott McConnell, The New Battle over Immigration, Fortune, p. 98, May 9, 1988.
8




4

2


















67 Scott McConnell, The New Battle over Immigration, Fortune. p. 98. May 9. 1988.






44


Educating Illegal Immigrant Children

Meyer v. Nebraska68 was a 1923 U.S. Supreme Court decision that overrode an

earlier Nebraska statue that barred individuals and schools from providing instruction in a language other than English to any student who had not completed the eighth grade. The defendant in Meyer was a teacher in a parochial school in a Lutheran church who taught German language to a ten-year-old boy who had not passed the eighth grade. The text used, a book of biblical stories written in German, was for the purpose of giving religious instruction in English.69 Their plan, according to the pastor, was simply to have their children learn enough German to be able to worship together as a family.

The Meyer decision put a stop to what had become a national trend. Nebraska had passed its English-only statute in 1919, and fourteen other states had followed its lead. Some had gone so far as to declare English (or "American") to be their official language. The decision in Meyer gave educators the right to use a language other than English in the classroom.

The Refugee Act of 1980,70 provided funding for such programs as English for

Speakers of Other Languages (ESOL or ESL). This program allowed immigrant students to be taught in their native language at a public school. The Consent Decree of 199071 mandated surveying immigrant students to determine their level of need for language Meyer v. Nebraska 262 U.S. 390 (1923).

69 Ellis Cose, A Nation of Strangers: Prejudice, Politics and the Populating ofAmerica. New York: Wm. Morrow & Company, Inc., 1992.

70 Refugee Act of March 17, 1980, Immigration and Nationality Act, [101(a)(42)(A)]. 71 Florida Department of Education. (1996a). 1990 League of United Latin American Citizens (LULAC) et al. v. State Board of Education Consent Decree. Tallahassee, FL: Office of Multicultural Student Language Education.






45


services in order to learn English and to provide those services as part of the education program.

Immigration policy up to 1965, did not address the aspect of educating the children of immigrants, legal or illegal. Each state had their own laws (or none) regarding the education of immigrants and other "suspect" classes. The education of illegal immigrant children did not become an issue until the decade of the 1970s in Texas, and then it became a problem.

Plyler v. Doe72 represented the epitome of confidence in America's assimilative capacity. The United States Supreme Court held that states could not deny a free public education to the foreign born children of illegal immigrants.73 In Plyler, the Court considered the Texas statute74 prohibiting state-funded public education to children of illegal aliens. James Plyler was the Superintendent of the Tyler Independent School



72 Plyler, 457 U.S. at 202 (1982).

73 Ibid., p. 230.

74 TEXAS EDUCATION CODE ANN. 21.03 (Vernon Supp. 1981) cited in Plyler, 457 U.S. at 201 n.l.
(a) All children who are citizens of the United States or legally admitted aliens and who are over
the age of five years and under the age of 21 years on the first day of September of any
scholastic year shall be entitled to the benefits of the Available School Fund for that year.
(b) Every child in this state who is a citizen of the United States or a legally admitted alien and
who is over the age of five years and not over the age of 21 years on the first day of September of the year in which admission is sought shall be permitted to attend the public free schools of
the district in which he resides or in which his parent, guardian, or the person having lawful
control of him resides at the time he applies for admission.
(c) The board of trustees of any public free school district of this state shall admit into the public
free schools of the district free of tuition all persons who are either citizens of the United States or legally admitted aliens and who are over five and not over 21 years of age at the
beginning of the scholastic year if such persons or his parent, guardian or person having lawful
control resides within the school district.






46


District, which was named in the case by "certain named and unnamed undocumented alien children."75

Mexican children who had entered the United States illegally and resided in Texas sought injunctive relief against exclusions from public schools pursuant to a Texas statute and school district policy. The United States District Court for the Eastern District of Texas," William Wayne, Justice, permanently enjoined defendants, and the defendants appealed. The Court of Appeals for the Fifth Circuit77 affirmed. Probable jurisdiction was noted.

The Supreme Court, under Justice Brennan,78 in the majority opinion, held that:

(1) the illegal aliens who were the plaintiffs could claim the benefit of the equal protection clause, which provided that no state could deny to any person the benefit of jurisdiction in the equal protection of the laws; whatever his status under the immigration laws, an alien was a 'person" in any ordinary sense of that term. This Court's prior cases recognized that illegal aliens were "persons" protected by the Due Process Clauses of the Fifth and Fourteenth Amendments, which Clauses do not include the phrase "within its jurisdiction," could not be distinguished on the asserted ground that persons who had entered the country illegally were not "within the jurisdiction" of a State even if they were present within its boundaries and subject to its laws. Nor did the logic and history of the Fourteenth Amendment support such a construction. Instead, use of the phrase "within 7S Ibid.

76 458 F. Supp. 567.
7 628 F. 2d 448.

78Plyler, 457 U.S. 245.






47


its jurisdiction" confirmed the understanding that the Fourteenth Amendment's protection extended to anyone, citizen or stranger, who was subject to the laws of a State, and reached into every corner of a State's territory; (2) the discrimination contained in the Texas statute which withheld from local school districts any state funds for the education of children who were not "legally admitted" into the United States and which authorized local school districts to deny enrollment to such children could not be considered rational unless it furthered some substantial goal of the state. Although undocumented resident aliens could not be treated as a "suspect class," and education was not a "fundamental right," so as to require the State to justify the statutory classification by showing that it served a compelling governmental interest, the Texas statute did impose a lifetime hardship on a discrete class of children not accountable for their disabling status. These children could neither affect their parents' conduct nor their own undocumented status. The deprivation of public education was not like the deprivation of some other governmental benefit79. Public education had a pivotal role in maintaining the structure of our society and in sustaining our political and cultural heritage; the deprivation of education took an inestimable toll on the social, economic, intellectual, and psychological well-being of the individual, and posed an obstacle to individual achievement. In determining the rationality of the Texas statute, its costs to the Nation and to the innocent children could properly be considered; (3) the undocumented status of the children vel non did not establish a sufficient rational basis for denying the benefits that the state afforded other residents. It was true that, when faced with an equal protection challenge respecting a State's differential treatment of aliens, the courts needed to be attentive to 79 Plyler, 457 U.S. 203






48


congressional policy concerning aliens. But in the area of special constitutional sensitivity presented by these cases, and in the absence of any contrary indication fairly discernible in the legislative record, no national policy was perceived that might justify the State in denying these children an elementary education; (4) there was no national policy that might justify the state in denying the children an elementary education; and (5) the Texas statute could not be sustained as furthering its interest in the preservation of the state's limited resources for the education of its lawful residents. While the State did have an interest in mitigating potentially harsh economic effects from an influx of illegal immigrants, the Texas statute did not offer an effective method of dealing with the problem. Even assuming that the net impact of illegal aliens on the economy was negative, charging tuition to undocumented children constituted an ineffectual attempt to stem the tide of illegal immigration, at least when compared with the alternative of prohibiting employment of illegal aliens. Nor was there any merit to the suggestion that undocumented children were appropriately singled out for exclusion because of the special burdens they imposed on the state's ability to provide high-quality public education. History did not show that exclusion of undocumented children was likely to improve the overall quality of education in the State. Neither was there any merit to the claim that undocumented children were appropriately singled out because their unlawful presence within the United States rendered them less likely than other children to remain within the State's boundaries and to put their education to productive social or political use within the State.80



"o Plyler, 457 U.S. 246.









The Court recognized that "education was not a right" the constitution granted

individuals.8' Additionally, the Court rejected the premise that the children comprised of a suspect class qualified for full rights as Americans.82 Illegal alien children, unlike members of racial groups, were not a protected subclass because their classification resulted from voluntary criminal decisions on the part of their parents to reside in the United States. Yet, the Court referred to the role American education played in transmitting "our" American values and maintaining the democratic nature of "our" political system.83 The Court stated: "We have recognized 'the public schools as a most vital civic institution for the preservation of a democratic system of government,' ... and as the primary vehicle for transmitting 'the values on which our society rests,' ... 'In sum, education has a fundamental role in maintaining the fabric of our society."'"

The Plyler Court used "our" in a very special sense. The Court implied that in 1982 there was an "our" on which most could basically agree and which encompassed political, social, and educational values.

The Court's majority determined that "equal protection" under the Fourteenth Amendment "was not confined to the protection of citizens." Both the equal protection and the due process clauses of the Constitution, the court declared, "are Universal in their application, to all persons within the territorial jurisdiction, without regard to any "8 Plyler, 457 U.S. at 221 (citing San Antonio Independent School District v. Rodriguez, 411 U.S. 1, 35 [1973]).

82 Ibid., p. 223.

83 Ibid., pp. 221-223.

* Ibid, p. 221.






50


differences of race, color, or of nationality; and the protection of the laws was a pledge of the protection of equal laws."85

The Court's majority opinion in Plyler v. Doe, given by Justice Brennan,

contained rather dramatic and elegant language highlighting the public-interest aspects involved. Penalizing children for the illegal entry of their parents would have marked them with the "stigma of illiteracy for the rest of their lives."86 If education in the United States was not a fundamental right, the opinion continued, "neither was it merely some governmental 'benefit' indistinguishable from other forms of social welfare." Also underlined by the Court majority was that education was "the most vital civic institution for the preservation of a democratic system of government" and that "we cannot ignore the significant social costs borne by our Nation when select groups are denied the means to absorb the values and skills upon which our social order rests."87 They added, "It is .. clear that whatever savings might be achieved by denying these children an education, they are wholly insubstantial in light of the costs involved to these children, the State, and the Nation.""8

The majority further acknowledged that illegal aliens might have a negative net impact upon the economy, but did not buy the argument that barring their children from public education would have the effect of discouraging illegal entries, "at least when compared with the alternative of prohibiting employment of illegal aliens." The majority further indicated that they would not be impressed even if the state could have proven that 85 Yick Wo v. Hopkins, 118 U.S. 369, (1886).

86 Plyler, 457 U. S. 224.
87 Ibid., p. 221.






51

the quality of public education was improved by excluding a certain group of children from educational opportunities. The state, they reasoned, had not justified its selection of the particular group.89

As a result of the Supreme Court's decision," no school in the United States could legally deny immigrant students admission on the basis of their undocumented status, nor could they treat undocumented students differently than any other student.

Justices White, Rehnquist, and O'Connor joined Chief Justice Burger in his dissention of the ruling.9 In the minority, they felt that it was senseless for an enlightened society to deprive any children including illegal alien of an elementary education. However, "the Constitution did not constitute us as 'Platonic Guardian,' nor did it vest in the Court the authority to eliminate laws because they did not meet our standards of desirable social policy, 'wisdom,' or 'common sense.'"" (See APPENDIX for further clarification.)

The minority of the Court had no problem with the conclusion that the Equal Protection Clause of the Fourteenth Amendment applied to illegal aliens who were physically "within the jurisdiction" of a state.93 The Equal Protection Clause did not



88 Ibid., p. 230.
89 Martha McCarthy, 'The Right to an Education: Illegal Aliens." Journal of Educational Equity and Leadership 2 (Summer 1982): 283-85.

90 Plyler, 457 U.S. 245.
9' Ibid.

92 TVA v. Hill, 437 U.S. 153, (1978).

93 Plyler, 457 U.S. 215.






52

mandate identical treatment of different categories of persons.94 The issue was whether, for purposes of allocating resources, a state had a legitimate reason to differentiate between persons who were lawfully within the state and those who were not.95 Therefore, the distinction drawn by Texas, based not on its own legitimate interests but on the classifications by the Federal Governments' immigration laws and policies, was not unconstitutional.

The Court had recognized that, in allocating governmental benefits to a given class of aliens, one "may take into account the character of the relationship between the alien and the country."96 When that "relationship" was a federally prohibited one, there could be no presumption that a state had a constitutional duty to include illegal aliens among the recipients of its governmental benefits.97

The Court held many times that the importance of a governmental service did not elevate it to a "fundamental right" for purposes of equal protection analysis." In San Antonio Independent School District, Justice Powell, speaking for the court, expressly rejected the proposition that state laws dealing with public education were subject to special scrutiny under the Equal Protection Clause. The Court further indicated there was



94 Jefferson v. Hackney, 406 U.S. 535, 549 (1972); Reed v. Reed, 404 U.S. 71, 75 (1971). 95 Plyler,457 U.S. 224.

96 Mathews v. Diaz, 426 U.S. 67, 80 (1976).
97 Plyler, 457 U.S. 247

9 San Antonio Independent School Dist. v. Rodriguez, 411 U.S. 1, 301 (1973); Lindsey v. Normet, 405 U.S. 56, 73-74 (1972).






53


no meaningful way to distinguish between education and other governmental benefits.99 Was education more "fundamental" than food, shelter, or medical care?

The Federal Government excluded illegal aliens from numerous social welfare programs, such as the food stamp program,'00 old-age assistance, aid to families with dependent children, aid to the blind, aid to the permanently and totally disabled, and supplemental security income programs,'0' the Medicare hospital insurance benefits program,1o2 and the Medicaid hospital insurance benefits for the aged and disabled program.103 Although these exclusions did not conclusively demonstrate the constitutionality of the State's use of the same classification for comparable purposes, at the very least they tended to support the rationality of excluding illegal alien residents of a state from such programs so as to preserve the state's finite revenues for the benefit of lawful residents. "4

The Court maintained, "Barring undocumented children from local schools would not necessarily improve the quality of education provided in those schools."'s0 However, the legitimacy of barring illegal aliens from programs such as Medicare or Medicaid did not depend on a showing that the barrier would "improve the quality" of medical care given to persons lawfully entitled to participate in such programs. Education, like 99 Plyler, 457 U.S. 248.

00 7 U.S.C. 2015(f) (1976 ed. and Supp. IV) and 7 CFR 273.4 (1981). '0' 45 CFR 233.50 (1981).

o2 42 U.S.C. 1395i-2 and 42 CFR 405.205(b) (1981). 03 42 U.S.C. 13950 and 42 CFR 405.103(a)(4) (1981). 104 Mathews v. Diaz, 426 U.S. 80.

'05 Plyler, 457 U.S. 252: See 458 F.Supp. 569, 577 (ED Tex.1978).






54

medical care, was enormously expensive, and there could be no doubt that very large added costs would fall on the State or its local school districts as a result of the inclusion of illegal aliens in the tuition-free public schools.

Justice Burger went on to say that "Denying a free education to illegal alien children is not a choice I would make were I a legislator. Apart from compassionate considerations, the long-range costs of excluding any children from the public school may well outweigh the costs of educating them."'" But that was not the issue: the fact that there were sound policy arguments against the Texas Legislature's rule did not make it unconstitutional.107

Justice Burger saw the ruling as a quick fix for the failings of the political

processes. He felt that better enforcement of immigration laws and policies would have prevented the need to rule on the right of illegal children to a free education.'08

The court suggested that "our" institutions had confidently and successfully

undertaken similar challenges. In Plyler, confidence in undertaking tough educational missions, analogous to those in prior decisions such as Meyer v. State ofNebraska,' 9



'" Plyler, 457 U.S. 253.
107 Ibid.

108 Ibid.

109 In Meyer v. State of Nebraska, 262 U.S. 390 (1923) the United States Supreme Court upheld the right of parents and teachers to arrange foreign language instruction for children and struck down a Nebraska statute prohibiting foreign language instruction to children before the eighth grade (see Neb. Laws 1919, CH. 249). The Court stated: "It is the natural duty of the parent to give his children education suitable to their station in life... "(400). The Court saw no harm in German language instruction to children when the children's parents did not contest the right of the state to reasonably regulate schools, compel attendance, and prescribe a curriculum for state-supported institutions. (Meyer, pp. 402-03).






55


Pierce v. Society of Sisters, o0 and Brown v. Board of Education'' prevailed over the

public interest doctrine revitalized in Ambach v. Norwick. 12


0o In Pierce v. Society of Sisters, 268 U.S. 510 (1925), the United States Supreme Court extended the Meyer reasoning to protect the right of private institutions to educate children. The Court invalidated an Oregon statute prohibiting private education of "normal" children within a reasonable distance from a public school (see Laws Or. 1923, p.9). The Court noted that it was within the state's power to reasonably regulate schools, to require that teachers be of "good moral character and patriotic disposition," or to require the teaching of certain subjects "plainly essential to good citizenship." However, the Court held that the states had no general power to "standardize its children by forcing them to accept instruction from public teachers only." (Pierce, pp. 534-535).

"' It was not until 1954, in Brown v. Board of Education, 347 U.S. 483, however, that the United States Supreme Court had the confidence to tackle one of the most enduring and debilitating problems in American life: the doctrine of separate but equal education.. At last, stated the Court, America must use its mature and successful institutions to include all Americans:

We must consider public education in the light of its full development and its present place in American life throughout the Nation. Only in this way can it be determined if segregation in public schools deprives these plaintiffs of the equal protection of the laws. Today, education is perhaps the most important
function of the state and local governments. Compulsory school attendance laws
and the great expenditures for education both demonstrate our recognition of
the importance of education to our democratic society. It is required in the
performance of our most basic public responsibilities, even service in the armed forces. It is the very foundation of good citizenship. Today it is a
principal instrument in awakening the child to cultural values, in preparing
him for later professional training, and in helping him to adjust normally to his
environment. In these days, it is doubtful that any child may reasonably be
expected to succeed in life if he is denied the opportunity of an education.
Such an opportunity, where the state has undertaken to provide it, is a right
Which must be made available to all on equal terms. Ibid. pp. 492-93.

m2 In Ambach v. Norwick, 441 U.S. 68 (1979), the United States Supreme court upheld a New York statute denying public school teaching positions to aliens who were eligible for citizenship but refused to naturalize. The Court noted that state power to enact classifications based on alienage had narrowed to the point of being "inherently suspect and subject to close judicial scrutiny" (Ibid. pp. 72-73 [internal citations omitted]). Nevertheless, the Court acknowledged that states have some functions so entwined with state governmental operations so as to allow exclusion of aliens under the still extant public interest doctrine (Ibid., pp. 73-74).
Citing Brown, Society of Sisters, and Meyer, the Court stressed the importance of education to our democratic society and to our culture (Ibid., pp. 76-77 [other internal citation omitted]). Moreover, the Court cited numerous authorities regarding the inculcating and democratizing role of the "public schools as an 'assimilative force' by which diverse and conflicting elements of our society are brought together on a broad but common ground." (Ibid., pp. 77-78). Additionally, the court recognized the special role that teachers play in the education of children as well as the wide latitude teachers have in the manner information is communicated to students as a rationale for a state to put reasonable requirements on teachers (Ibid., pp. 78-79). Once again, the court had acknowledged the nexus between cultural dynamism and core values.






56


The Plyler Court cited Ambach to emphasize the importance of transmitting fundamental values to children."3 In Ambach, however, the Court stressed the fundamental role of education in a manner which vindicated the right of states to better control those who taught our children, even to the extent of excluding resident alien teachers."4 4 Whereas Ambach concentrated on how the state transmitted values, and through whom, Plyler, in fact, focused on those who received fundamental values. In attempting to reconcile Ambach and Plyler, the question became whether teaching children who have no legal right to be in the country creates less of a concern than the possibility that an alien teacher legally present in the United States may teach in public schools?"5

The following timeline delineated United States immigration laws and policies since 1790. The dates illustrated in bold indicate laws or policies of relevance to the education of immigrant children. The first ruling of any significance to immigrant education came in 1923 with Meyer v. Nebraska."6 Most of these rulings were discussed within the context of this paper.


"' Plyler, 457 U.S. at 221-23 (citing Ambach, 441 U.S. at 760). Ambach, 441 U.S. at 77-79.

15 In Ambach, Justice Powell did not require evidence proving or disproving whether (legally resident) alien teachers negatively affected the New York schools in any way: The issue was the public-interest doctrine and the right of the state to regulate a sensitive public sphere. In contrast, Justice Brennan emphasized the scant proof of negative economic impacts on Texas schools resulting from teaching the children of illegal immigrants (Plyler, 457 U.S. at 228, 229). Justice Powell, who wrote the majority decision in Ambach but concurred in Plyler, gave no clue why he did not use the public-interest doctrine in Plyler other than emphasizing that the affected parties were children (Plyler, 457 U.S. pp. 236-240 [Powell, J., concurring]). Justice Powell's only mention of the concerns of ordinary citizens was the bland statement that he was "not unmindful of what must be the exasperation of responsible citizens and government authorities in Texas and other States similarly situated." (Ibid., p. 240 [Powell, J., concurring]). 16 Meyer v. State of Nebraska, 262 U.S. 390 (1923).






57


Table 2-1 Timeline of U.S. Immigration and Alien Education Policies

1790 Naturalization Rule adopted. Federal government established a two-year residency
requirement on immigrants wishing to become u.s. citizens.
1819 Reporting Rule adopted. Data began to be collected on immigration into the United
States. Ships' captains and others were required to keep and submit manifests of
immigrants entering the U.S.
1875 First Exclusionary Act. Convict, prostitutes, and "coolies" (Chinese contract
laborers) were barred from entry into the United States.
1882 Immigration Act passed. The federal government moved to firmly establish its
authority over immigration. Chinese immigration was curtailed; ex-convicts, lunatics,
idiots, and those unable to take care of themselves were excluded. In addition, a tax
was levied on newly arriving immigrants.
1885 Contract laborers' entry barred. This legislation reversed an earlier federal law
legalizing the trade in contract labor.
1891 Office of Immigration created. Established as part of the U.S. Treasury Department,
this new office was later given authority over naturalization and moved to the U.S.
Justice Department. (It was known as the Immigration and Naturalization Service.) In the same year, paupers, polygamists, the insane, and persons with contagious diseases
were excluded from entry to the United States.
1892 Ellis Island opened. Between 1892 and 1953, more than 12 million immigrants were
processed at this one facility.
1903 Additional categories of persons excluded. Epileptics, professional beggars, and
anarchists were now excluded.
1907 Exclusions further broadened. Imbeciles, the feebleminded, tuberculars, persons with
physical or mental defects, and persons under age 16 without parents were excluded.
1907 "Gentleman's Agreement" between United States and Japan. An informal agreement
curtailed Japanese immigration to the United States. Also, the tax on new immigrants
was increased.
1917 Literacy Test introduced. All immigrants 16 years of age or older must have
demonstrated the ability to read a forty-word passage in their native language. Also,
virtually all Asian immigrants were banned from entry into the United States.
1921 Quota Act. An annual immigration ceiling was set at 350,000. Moreover, a new
nationality quota was instituted, limiting admissions to 3 percent of each nationality group's representation in the 1910 census. The law was designed primarily to restrict
the flow of immigrants coming from eastern and southern Europe.
1923 Meyer v. Nebraska. U.S. Supreme Court decision struck down an earlier Nebraska
statute barring individuals and schools from providing instruction in a language other
than English to any student who had not completed the eighth grade.
1924 Origins Act. The Act reduced the annual immigration ceiling to 165,000. A revised
quota reduced admissions to 2 percent of each nationality group's representation in the
1890 census. The U.S. Border Patrol was created.
1927 Immigration Ceiling Further Reduced. The annual immigration ceiling was further
reduced to 150,000; the quota was revised to 2 percent of each nationality's
representation in the 1920 census. This basic law remains in effect through 1965.






58


Table 2-1--continued.
1929 National Origins Act. The annual immigration ceiling of 150,000 was made
permanent, with 70 percent of admissions slated for those coming from northern and
western Europe, while the other 30 percent were reserved for those coming from
southern and eastern Europe.
1948 Displaced Persons Act. Entry was allowed for 400,000 persons displaced by World
War II. However, such refugees must have passed a security check and had proof of
employment and housing that did not threaten U.S. citizens' jobs and homes.
1952 McCarran-Walter Act. The Act consolidated earlier immigration laws and removed
race as a basis for exclusion. In addition, the Act introduced an ideological criterion for
admission: immigrants and visitors to the United States could be denied entry on the
basis of their political ideology (e.g., if they were Communists or former Nazis).
1964 Civil Rights Act of 1964. Title VI forbid discrimination against students who were
limited in their English proficiency.
1965 Immigration Act was amended. Nationality quotas were abolished. However, the Act
established an overall ceiling of 170,000 on immigration from the Eastern Hemisphere
and another ceiling of 120,000 on immigration from the Western Hemisphere.
1974 Lau v. Nichols. The U.S. Supreme Court held that the failure of the San Francisco
school system to provide for the lingual needs of non-English speaking Chinese
students violated section 601 of the Civil Rights Act of 1964.
1974 Equal Educational Opportunities Act of 1974. Required school districts to remove
barriers to non-English speaking students' access to equal educational opportunities. 1975 Texas Education Code prohibited the education of nonresident aliens. 1978 Worldwide immigration ceiling introduced. A new annual immigration ceiling of
90,000 replaced the separate ceilings for the Eastern and Western Hemispheres. 1979 Ambach v. Norwick. Teaching certificates could only be given to U.S. citizens. 1980 Refugee Act. A system was developed to handle refugees as a class separate from
other immigrants. Under the new law, refugees were defined as those who fled a
country because of persecution "on account of race, religion, nationality, or political
opinion." The president, in consultation with Congress, was authorized to establish an
annual ceiling on the number of refugees who may enter the United States. The
president also was allowed to admit any group of refugees in an emergency. At the
same time, the annual ceiling on traditional immigration was lowered to 270,000.
1982 Plyler v. Doe, 457 U.S. Case which determined that undocumented alien children were
entitled to a free public education and protection under the Fourteenth Amendment. 1989 Teresa P. v. Berkeley Unified School District. California federal district court found
that the Berkeley schools' English-based bilingual education program did not violate
federal law.
1986 Immigration Reform and Control Act. The annual immigration ceiling was raised to
540,000. Amnesty was offered to those illegal aliens able to prove continuous
residence in the U.S. since January 1, 1982. Stiff sanctions for employers of illegal
aliens.
1990 Immigration Act of 1990. The annual immigration ceiling was further raised to
700,000 for 1992, 1993, and 1994; thereafter, the ceiling would drop to 675,000 a year.
Ten thousand permanent resident visas were offered to those immigrants agreeing to
invest at least $1 million in U.S. urban areas or $500,000 in U.S. rural areas. The
McCarranWalter Act of 1952 was amended so that people could no longer be denied
admittance to the United States on the basis of their beliefs, statements, or associations.





59


1994 Proposition 187. Law would deny illegal aliens all public services including education.
The Supreme Court ruled it unconstitutional in 1997.
1996 Immigration Act. Congress voted to double the U.S. Border Patrol to 10,000 agents
over five years and mandated the construction of fences at heavily trafficked areas of the
U.S.-Mexico border. A program to check the immigration status of job applicants,
1996 Immigrants lose benefits. President Clinton signed welfare reform bill. Legal
immigrants lost their right to food stamps and Supplemental Security Income. Illegal
immigrants became ineligible for virtually all federal and state benefits except emergency
medical care, immunization programs, and disaster relief.
Source: Summary of U.S. Immigration Law, Close-Up Foundation Special Topic Page, July 1998.

Summary

In the 1920s, legislators responded to social tensions by enacting restrictive immigration laws. In the relatively tranquil society, which resulted from reduced immigration in the ensuing years, Americans began to have more confidence in their institutions and values through the decades of the 40s and 50s. By 1965, the very success of the immigration lull led many Americans to believe that American institutions could accommodate any level of diversity. The United States Congress confidently, chose to change immigration policy in 1965."7

After liberalization of American immigration laws in the 1960s, mass immigration to the United States began again and continued without significant debate on the issues of social cohesion, which so dominated earlier immigration discussions. Public schools were one of the first institutions to confront the consequences of American immigration laws and the lack of enforcement of those laws. With corresponding confidence in American institutions and values, the United States Supreme Court in 1982 forced public schools to confront the challenge of illegal immigration.' 8 "7 Immigration Act of 1965, Pub. L. No. 89-235. 79 Stat. 911. 118 Plyler, 457 U.S. 202.






60


Illegal immigrant education legislation was historically in favor of providing said education to all students in residence in a given state, whether legal or otherwise, and in a language conducive to their learning success.

Given the laws and trends in immigration, educators in every sector expected a substantial share of their students to come from other countries. Immigration in both its legal and illegal manifestations continued to rise to higher levels than ever before in the nation's history.

Although a larger number of highly educated immigrants were on their way, an even greater flow of illegal immigrants enlarged the nations' pool of illiterate or poorly educated residents. The continued emphasis on family reunification also brought large numbers of immigrants who tended to have less education that the original entrants. Educators in the United States needed to be ready to serve an even more diverse clientele in its future.















CHAPTER 3
IMMIGRATION LAWS AND PROPOSITION 187


Introduction

This chapter reviews the major immigrant education laws and policies of the last half of the nineteenth century. It discusses ways in which each are based on precedent policy and how they are associated. Of particular concern are Plyler v. Doe' and California's Proposition 187.2


Background

The earliest immigration laws were designed to protect the populace. Criminals, prostitutes, and other undesirables were prohibited from entering the United States. Exclusionary practices were implemented to keep certain nationalities from entering on a permanent basis. Finally, immigration laws were adapted to achieve acceptable levels of immigration to ensure that the United States could assimilate the new population comfortably.

The immigration laws of the United States divided all people in the world into two groups: "United States nationals" and "aliens."3 Almost all nationals also carried i Plyler v. Doe, 457 U.S. 202 (1982).

2 Proposition 187 was approved by the electors of California on November 8, 1994, as an initiative statute. See 1994 Cal. Legis. Serv., Prop. 187, (Westlaw).
3 Immigration and Nationality Act, (INA), Public Law 82-414, [s 101(a)(3)], 8 U.S.C. [s 1101(a)(3)] (1994), defines "alien" as "any person not a citizen or national of the United States." Since all citizens are nationals, the definition of "alien" could easily read "any person not a national of the United States."

61






62


the title "citizen." Aliens in turn were divided into two subgroups: immigrants and nonimmigrants. A nonimmigrant was any alien who could prove that he or she fell into one of the statutorily enumerated categories of temporary visitors, such as students, tourists, business visitors, or temporary workers.4 All other aliens were immigrants5 and therefore subject to the more rigorous standards applicable to those who sought permanent residence in the United States.

Immigrants themselves were sub-classified. There were those who were

"lawfully admitted for permanent residence,"6 holders of so-called "green cards." And there were those who were here unlawfully, having entered illegally, overstayed, or otherwise violated the terms of temporary admission (undocumented or illegal immigrants). There was an additional hybrid category known as aliens "Permanently Residing Under Color of Law," or PRUCOLs.7 While the definition of PRUCOL varied from one program to another, the term typically encompassed those who had received asylum, some of those who had been paroled from prison into the United States, and miscellaneous others who remained in the United States with the knowledge and permission of the Immigration and Naturalization Service (INS) and whom the INS did not intend to remove. The most general observation was that the major federal and state



4 Immigration and Nationality Act, Public Law 82-414, (INA) [s 101(a)(15)], 8 U.S.C. [s 1101(a)(15)] as amended (1994).

' Ibid.
6 Ibid., [s 101(a)(20)].

7U.S. Commission on Immigration Reform, U.S. Immigration Policy: Restoring Credibility 139-43 (1994) [hereinafter CIR]; includes certain Cubans and Haitians and aliens whose deportations have been withheld or stayed.

s Ibid.






63


benefit programs were open to United States citizens and to those aliens who had been

lawfully admitted as permanent residents.

In addition, several important programs, including Aid to Families with

Dependent Children (AFDC)9, Supplemental Security Income (SSI)0 and Medicaid,"

covered PRUCOLs.'2

To be admitted to the United States in any capacity, an alien needed to prove he

or she was not "likely at any time to become a public charge."'3 A common way to

establish that was to submit an "affidavit of support" from an American sponsor, who

was willing and able to provide financial backing. For purposes of assessment of

financial eligibility under various federal benefit programs, however, a portion of the


9 Aid to Families with Dependent Children (AFDC). The AFDC program provided assistance for basic needs such as food and shelter to qualifying families with children. The families met certain income, immigration status and other qualifications to receive AFDC. The federal government and the states jointly funded the program. Those persons not eligible included undocumented aliens and those undocumented aliens who became legalized as a result of 1986 IRCA.

Io Supplemental Security Income (SSI). Aged, blind, and disabled persons whose income fell below specified levels received cash payments under the Supplemental Security Income program. As SSI eligible residents were automatically eligible for Medicaid, any change in such status and denial of Medicaid had an impact on health care costs for local providers.

" Medicaid. Medicaid was a joint state/federal program designed to provide medical assistance to financially needy individuals. The program was an automatic benefit for those individuals who received AFDC or SSI direct assistance. Potential recipient families met certain income, citizenship and other qualifications to receive Medicaid. Individuals not eligible included undocumented aliens and former undocumented aliens who became legalized as a result of the 1986 IRCA. Except for emergency Medicaid coverage which included emergency labor and delivery.

12 CIR.

13 Ways And Means Committee Print: 104-14 [1996 Green Book] "Appendix J. Noncitizens" The Personal Responsibility and Work Opportunity Reconciliation Act and Associated Legislation, 1996, (25 February 1997). "Public charge" was a term used in immigration law to describe someone who was, or likely to become, dependent on public benefits. In practice, public charge considerations have historically been a factor in the admissibility of aliens.






64

alien's income and resources was "deemed" to include those of the affiant for a certain number of years after the alien's admission. 14

In contrast to both lawfully admitted permanent residents and PRUCOLs,

undocumented immigrants were ineligible for federal and state benefit programs.'5 There were some exceptions, typically for emergency services, those services for which denial would endanger the general public, and any services that had been held to be constitutionally required. Examples included emergency medical, immunization programs, and public education.6

In the movement to strip undocumented immigrants of the few public benefits for which existing laws left them eligible, there were many generic arguments already discussed. There were also a number of additional points specific to undocumented immigrants.'7

The principal argument for withholding public benefits from undocumented immigrants was that they were in the United States illegally.' As wrongdoers, the argument went, they had no moral claim to receive services from the very government whose laws they had transgressed. The analogy was to a trespasser seeking support from the landowner whose property he or she had wrongfully entered.19 14 Ibid., pp. 129-31 (three years for AFDC and Food Stamps; five years for SSI). '5 CIR., pp. 115-17.
'6 Ibid.
7 42 UCLA L. Rev. 1453, *1467.
8 Ibid., p. 29.
'9 Ibid.






65

For similar reasons, some lawmakers saw the denial of public benefits as a

demonstration of governmental disapproval or even resolve. Without restrictions, it was argued, the government was sending mixed signals. Restrictions confirmed that the government took its immigration laws seriously.20

All of these arguments were legitimate, and most people agreed that the

government should not extend to undocumented immigrants the full range of benefits available to those who were here legally. However, few people denied that services such as police or fire protection, or emergency medical care were necessary. If pressed, most people thought that undocumented immigrants should receive some benefits but not others. So, the question was where to draw the line.21

In addressing the question, various arguments for extending certain benefits to undocumented immigrants were considered. It was not a reasonable assumption to believe that all undocumented immigrants were wrongdoers. Until their cases were adjudicated, their legal status was not settled. Many undocumented immigrants had asylum claims pending for a considerable length of time. Others had legitimate reasons to be in the United States. Further, whatever moral conclusions one reached with respect to adult undocumented immigrants, children were not viewed as morally culpable for accompanying their parents to the United States rather than staying behind, unaccompanied.22


20 Ibid.
21 Ibid.
22 Ibid.






66


One of the generic arguments against public benefits for immigrants was that such benefits were an unwelcome lure. In the case of undocumented immigrants, a counterargument was that the legally available benefits were too meager to have had that effect; a desire to work, a desire to rejoin their families or to escape persecution, were far more believable explanations.23

The public benefits that gave rise to the debate in areas as vital as health and

education were central to life opportunity. Depriving a morally innocent child of medical care or an education was considered extreme. Moreover, denying certain benefits to otherwise eligible undocumented immigrants at times caused tangible harm to United States citizen children in the same household, a problem to which even the Commission on Immigration Reform had called attention.24 Immigration Laws

Immigration law and policy changed substantially during the 1900s. Historically, immigration policy in the United States was based on a per-country quota system. The first true codification of immigration law resulted from the passage of the Immigration and Nationality Act of 1952.25 This was the initial attempt to give priority to those immigrants with highly valued skills. Family reunification became a priority in 1965 with the Immigration and Nationality Act amendments.26 This act also abolished the national quota system, eliminating national origin, race, or ancestry as a basis for 23 Ibid., p. 30.
24 42 UCLA Law Rev. rev. 1470.
25 Immigration and Nationality Act, Public Law 82-414, (1952). 26 Immigration and Nationality Act Amendments of October 3, 1965, (79 Stat. 911).






67

immigration to the United States. The 1986 Immigration Reform and Control Act27 provided for employer sanctions against businesses that employed undocumented aliens and legalization for qualified undocumented aliens. Immigration policy during the decade of the 1990s was based on The Immigration and Nationality Act, which prioritized eligibility on the basis of family reunification along with the need for immigrants with specific skills.28

The Immigration and Nationality Act passed in 1952 over President Truman's veto and remained the foundation for U.S. immigration law at the end of the twentieth century, although it had been amended numerous times.29 Among the most far-reaching of those amendments, the 1965 Immigration Act marked change in U.S. immigration policy. From the decade of the 1920s until passage of the 1965 law, American immigration policy had operated on a strict per-country quota system. The 1965 law shifted that policy to a system that emphasized family reunification and employment or job skills needed in the U.S. labor market.30 Besides family-based and employment based immigration, refugees were expressly allowed to immigrate to the United States.

The Refugee Act of March 17, 198031 was prompted in large part by the arrival of more than 400,000 refugees from Southeast Asia between 1975 and 1980. The legislation sought to give refugee policy greater consistency by allowing for both a 27 Immigration Reform and Control Act of 1986, Public Law 99-603. 28 Immigration and Nationality Act Amendments of October 3, 1965, (79 Stat.911) as amended by the Immigration Act of 1990, P.L. 101-649, (104 Stat. 4978). 29 James G. Gimpel and James R. Edwards Jr., 1999. The Congressional Politics of Immigration Reform, Needham Heights, MA, Allyn & Bacon.
3o Ibid., p. 60.
3' Refugee Act of March 17, 1980, Immigration and Nationality Act, [101(a)(42)(A)I.






68


regular flow of refugees and emergency admissions. The Refugee Act of 1980 defined "refugee" in U.S. law; it then became section 101(a)(42)(A) of the Immigration and Nationality Act.32 The 1980 act provided funding for all areas of refugee settlement, and allowed access to such programs as AFDC, ESOL, and vocational and employment related training.33

On November 6, 1986, the Immigration Reform and Control Act34 tackled the

growing issue of illegal immigration. In hopes of stemming the entry of illegal aliens, the 1986 act imposed penalties on employers who knowingly hired undocumented workers. It also allowed illegal aliens who had lived in the United States since 1981, as well as undocumented agricultural workers, to become citizens. Under this amnesty program, more than 2.8 million illegal aliens out of approximately 3 million applicants gained legal status by the time all cases were resolved.

The Immigration Act of November 29, 199035 raised the limit on annual

admissions to 675,000 immigrants. (The 1965 act had set the ceiling at 290,000.) The 1990 law also nearly tripled the number of immigration slots reserved for newcomers with prized job skills and their families. When the revision took effect in 1995, over 71 percent of immigration visas went to family members of U.S. citizens and legal residents; about 21 percent were set aside for well-trained workers and their families; and about 8


32 Immigration and Nationality Act, Public Law 82-414. The Immigration and Nationality Act has been amended many times. When Congress enacted a law, it generally did not re-write the entire body of law, or even entire sections of a law, but instead added to or changed specific words within a section. These changes were then reflected within the larger body of law. 33 The Unfair Burden, Florida Governor's Office, March 1994. Immigration Reform and Control Act of 1986, Public Law 99-603.






69


percent were available for immigrants from countries that had received relatively few visas in previous years.36


Table 3-1 Immigration to the U.S. in 1992

Relatives of U.S. citizens and 520,000
permanent residents
Skilled workers and their families. 140,000 Citizens from countries with 40,000
few recent immigrant visas
Political refugees 141,000 Illegal Aliens (estimate) 200,000 TOTAL 1,041,000

Source: U.S. Immigration & Naturalization Service, 1993 Illegal Aliens

Although exact numbers were difficult to determine, research indicated that more than 200,000 illegal aliens settled permanently in the United States each year.37 Many arrived legally as students or tourists and then stayed beyond the limitations of their visas. Others used false documents to slip past immigration officials. The majority, however, entered the country by crossing the U.S.-Mexican border, making the problem of illegal aliens, in many respects, a question of foreign policy.

Illegal aliens and border control were relatively new concepts in the history of U.S. immigration. Until 1968, there were no official limits on immigration from countries in 35 Immigration Act of 1990, P.L. 101-649. 104 Stat. 4978. The 675.000 level was to consist of 480,000 family-sponsored, 140,000 employment-based, and 55,000 "diversity immigrants." 36Gimpel and Edwards, The Congressional Politics. 17 Ibid.






70


the Western Hemisphere. There was not even an attempt to monitor the borders until 1924.38 Mexican workers, in particular, were a critical part of the labor force in the southwest, but they generally worked in agriculture during the growing season and then returned to their homes in Mexico. From the beginning of World War II, as American recruits were sent overseas until 1964, the Bracero Program39 gave this arrangement official status, permitting the entry of 4 million to 5 million temporary agricultural workers to fill the farm labor shortage.4

Since the 1960s, both the forces pushing illegal aliens northward and those

attracting them to the United States had grown stronger. In 1972, the INS caught about 500,000 illegal aliens crossing the border.4' In 1986, the year that the Immigration Reform and Control Act42 was enacted, that figure had increased to nearly 1.8 million. The composition of the illegal alien population had changed in the previous two decades. Although the typical illegal alien was still a single young man, more women and children were entering the country illegally as well. Less than one-quarter of illegal aliens worked in agriculture. The majority lived and worked in large cities. In addition, Mexicans made up a smaller proportion of illegal aliens than in the past. Increasingly, illegal aliens were arriving from Central America, the Caribbean, and East Asia. In 1984, for example, 38 The Immigration Act of May 26, 1924 (43 Statutes-at-Large 153), together with the Immigration Act of 1917 (39 Statutes-at-Large 874), governed American immigration policy until 1952. At the same time, Congress established the Border Patrol in response to the concern with increased illegal movement across the borders with Canada and Mexico.
39 In 1942 the Bracero Program ( also know as the Mexican Farm Labor Supply Program) was begun in order to allow entry to agricultural workers on a temporary basis. 40 Gimpel and Edwards. Congressional Politics, p. 71. 41 Peter H. Schuck, The Meaning of 187: Facing Up to Illegal Immigration, The American Prospect No. 21, Spring 1995.
42 Immigration Reform and Control Act of 1986, Public Law 99-603.






71

the Border Patrol in Texas arrested would-be immigrants from 43 countries.43 The 1986 Act" was intended to cut off the flow of illegal aliens by penalizing employers who hired them. In fact, illegal aliens in many areas had little difficulty obtaining false documents to qualify for jobs that were readily available.

The cost of providing social services to illegal aliens was also part of the border control debate. Although nearly 3 million illegal aliens were legalized by the 1986 act, census figures indicated that 3 million to 4 million illegal aliens lived in the United States according to 1990 Census figures.45 Like all immigrants in general, the illegal aliens were concentrated in a few states, primarily California, Texas, Florida, Illinois, and New York.

In 1982, the Supreme Court ruled that states must provide illegal aliens with schooling.46 That decision, along with the growing proportion of women and children among the illegal alien population, added to the education and health care budgets of several states.



43 Schuck, Illegal Immigration.

44 Immigration Reform and Control Act of 1986, Public Law 99-603. 45 U.S. Census, 1990.

46 Plyler, 457 U.S. 220 (1982).






72






Top Ten States Where Illegal Aliens Reside October 1996
(in thousands)

2500


2000


1500 1000


500


~ b' e ~sP) ...... .




Source: U.S. Immigration and Naturalization Service, 1996 Figure 3-1 Top Ten States Where Illegal Aliens Reside


The same states that were burdened by the social service needs of illegal aliens, however, were also home to the businesses that employed them. Some employers contended that Americans were unwilling to work hard for low wages. Whether stitching pants in a clothing factory, washing dishes in a restaurant, or harvesting fruits and vegetables, illegal aliens had become a crucial element of the work force in many areas. Critics of the practice maintained that some employers preferred hiring undocumented workers because they were least likely to complain about low pay and poor working






73


conditions. In fact, law enforcement officials reported that sweatshops operating outside the law in the garment industry made a comeback in Los Angeles and New York City thanks to the availability of illegal alien labor.

The courts had long prohibited the states from discriminating against legal

immigrants, largely on the grounds that the state's authority in this area was subordinate to the federal government's. But, the courts had never addressed illegal immigration. It simply had not been a major issue.

Illegal immigration first became an issue in the early 1960s. Immigration and

Naturalization Service (INS) arrests-a limited indicator of illegal entries--swelled from 1.6 million during the decade of the 1960s to 8.3 million in the decade of the 1970s, and then continued to rise in the early 1980s.47 When states and localities sought to protect their education and health care budgets by imposing restrictions on the newcomers' access to benefits, the courts could no longer ignore the issue.

Plyler v. Doe48 stands at the apex of immigrants' rights in the United States.49 This class-action suit brought on behalf of undocumented Mexican children living in Texas. Upholding the ruling of a lower court, a 5-4 majority canceled a statute that 47 Schuck, Illegal Immigration, pp. 85-92.

4s Plyler, 457 U.S. 202 (1982). Plyler v. Doe" was a class action, filed in the United States District Court for the Eastern District of Texas in September, 1977, on behalf of certain school-age children of Mexican origin residing in Smith County, Texas, who could not establish that they had been legally admitted into the United States. The action complained of the exclusion of plaintiff children from the public schools of the Tyler Independent School District. The Superintendent James Plyler, and members of the Board of Trustees of the School District were named as defendants; the State of Texas intervened as a partydefendant. After certifying a class consisting of all undocumented school-age children of Mexican origin residing within the School District, the District Court preliminarily enjoined defendants from denying a free education to members of the plaintiff class. In December 1977, the court conducted an extensive hearing on plaintiffs' motion for permanent injunctive relief. 49 Michael A. Olivas, Storytelling Out of School: Undocumented College Residency, Race, and Reaction, Hastings Law Quarterly, Vol. 22 (Summer, 1995), 1019-1086.






74

withheld from local school districts any state funds for the education of any child who was not legally admitted into the United States. There the Court held that a Texas statute that effectively denied undocumented children a public-school education violated the Fourteenth Amendment's Equal Protection Clause.5so Bearing the extra expense of providing an education and services to undocumented children was felt by Texas voters to be extremely unfair in light of the fact that these children and their parents were not supposed to be in the state in the first place.5'


Proposition 187

Out of similar frustration over the expenses of illegal immigration to the state, the voters of California enacted Proposition 187 in 1994.52 The statute was a dramatic effort to drive out undocumented aliens and to deter their entry by cutting them off from medical and other public services and depriving their children of an education.53 It was described in the official ballot argument as "the first giant stride in ultimately ending the ILLEGAL ALIEN invasion." The text read as follows.


PROPOSITION 187 (Text of Proposal)

Any person who manufactures, distributes, or sells documents to conceal the true citizenship or resident alien status of another person is guilty of a felony, and shall be punished by imprisonment in the state prison for five years or by a fine of seventy-five thousand dollars.... Any person who uses false documents to conceal his or her true citizenship or resident alien status is guilty of a felony, and shall be punished by imprisonment in the state

5 Plyler, 457 U.S. 202 (1982).
sh Ibid.

52 Proposition 187 was approved by the electorate of California on November 8, 1994, as an initiative statute. See 1994 Cal. Legis. Serv., Prop. 187 (Westlaw).
5 Ibid.






75

prison for five years or by a fine of twenty-five thousand dollars....
No public elementary or secondary school shall admit, or permit the attendance of, any child who is not a citizen of the United States, an alien lawfully admitted as a permanent resident, or persons who are otherwise authorized to be present in the United States.... In order to carry out the intention of the People of California that, excepting emergency medical care as required by federal law, only citizens of the United States and aliens lawfully admitted to the United States may receive the benefits of publiclyfunded health care.s4

Basically, Proposition 187 made illegal aliens ineligible for public social services, public health care services, and public school education at elementary, secondary, and post secondary levels.55 It also created substantial criminal penalties for the manufacture, distribution, sale, or use of false citizenship or permanent residence documents. It required state and local law enforcement officials to cooperate with the INS in identifying and apprehending undocumented aliens.56

Proposition 187 was a combination of different policies that sought to stem the flow of illegal aliens into California. It was designed to encourage the state's roughly 1.4 million illegal residents to go home, and expel the rest. The most controversial provisions barred anyone who was not a citizen, legal permanent resident (green card holder), or legal temporary visitor from receiving public social services, health care, and education. The provisions differed slightly for each service, but they generally imposed three duties on all service providers: the verification of the immigration status of all who sought services, the prompt notification of state officials and the INS of anyone who was "determined or reasonably suspected to be" in violation of immigration laws, and the 4Ibid.
5 Schuck, Illegal Immigration, pp. 85-92.





76


notification of the alien (or in the case of children, their parent or guardian) of their apparently illegal status.57 Proposition 187 was no ordinary law; it provided that the legislature could not amend it "except to further its purposes" and then only by a recorded super-majority vote in each house of the legislature or by another voter initiative.

California's Proposition 187 contained several components aimed at stopping illegal immigration. It strengthened federal welfare laws that already denied most benefits to illegal aliens. A provision of 187 built on existing federal law relating to the use or sale of fraudulent documents and gave the state an extra weapon to combat such activities. Proposition 187 also required local, state, and federal agencies to share information.58

Proposition 187 established a number of principles in relation to public education. First, it aimed to deter future illegal immigration for free education. The problem of educating illegal aliens at taxpayers' expense related not only to illegal aliens already here, but to those who would come in the future. Second, it proposed that education should be in the person's home country. Third, the initiative addressed the financial problems caused by providing illegal immigrants with free education. The costs of educating non-English speaking immigrants were higher due to their need to learn English.


56 Thomas A. Alienkoff, David A. Martin, and Hiroshi Motomura. (1998). Immigration and Citizenship: Process and Policy. Fourth Edition. West Group, St. Paul, Minn. 57 Schuck, Illegal Immigration, pp. 85-92.
58 Ibid.






77

The statute was attacked immediately as unconstitutional in several lawsuits, and its operation shackled by restraining orders. On Dec. 14, 1996, U.S. District Court Judge Mariana R. Pfaelzer of the Central District of California issued an oral decision to enjoin the major provisions of Proposition 187 until trial.59


Constitutional Violations

Based on Judge Pfaelzer's statement, the written decision/order, when issued,

found that much of the statute violated two of the provisions of the Constitution -- (1) the Supremacy Clause,6 by stepping on ground preempted by federal immigration law; and

(2) the Fourteenth Amendment, first, by effectively ordering the deportation of California residents without hearings or other due process of law and, second, by denial of free education to undocumented children, that Amendment's Equal Protection clause.61

Proposition 187 prohibited public social services to those who could not establish their status as a U.S. citizen, a lawful permanent resident, or an "alien lawfully admitted for a temporary period of time."62 Only persons in those categories could receive healthcare services from a publicly funded health care facility, "other than emergency medical care as required by federal law."63 Anyone else was to be denied the requested services or other benefits, directed in writing to "either obtain legal status or leave the United 59 "Initiative on Aliens Suffers Its Biggest Setback Yet," New York Times, Dec. 15, 1994, A18. 60U.S. Constitution, Article VI.
61 Stanley Mailman, January 3, 1995. California's Proposition 187 and Its Lessons, New York Law Journal (p.3, col.1).
62 Proposition 187, Sec. 5. The provisions that generate most benefits at issue are federal laws that bar aliens who are not admitted as lawful residents or otherwise permanently residing here under color of law. 63 Ibid., Sec. 6.






78

States" and be reported to the authorities, including the Immigration and Naturalization Service (INS).64

Proposition 187 also limited attendance at public schools to U.S. citizens and to aliens lawfully admitted to the United States for permanent residence or otherwise authorized to be here.65 Whenever school districts reasonably suspected a violation, they had only 45 days to so notify INS and other authorities and to advise parents that schooling would be cut off in 90 days.66

The constitutional challenge to Proposition 187 rested mainly on the Plyler67 precedent. Writing for the Plyler majority, Justice William Brennan argued that the Texas law would inevitably harm children. These children would eventually obtain legal status in this country, yet would be "permanently locked into the lowest socioeconomic class." Brennan acknowledged that the state had some leeway in such matters. Under equal-protection principles, illegal alien status was not a "suspect class' like race or religion, and education was not a "fundamental right." Hence, it did not require heightened judicial scrutiny. Nevertheless, Brennan said, a law that denied children "the ability to live within the structure of our civic institutions can hardly be considered rational unless it furthers some substantial goal of the State.' "

Brennan conceded that keeping illegal aliens out of the state might be a legitimate state goal. But the trial court found that the Texas law had neither the purpose nor the 64 Mailman, 187 and Its Lessons, p.3, col. 1.
65 Proposition 187, Sec.7.

* Mailman, 187 and Its Lessons, p.3, col. 1.
67 Plyler, 457 U.S. 202 (1982).

" Schuck, Illegal Immigration, pp. 85-92.






79

effect of doing that, and Brennan agreed. The Texas law might have saved some money, according to Brennan, but Texas failed to establish that illegal aliens imposed a significant fiscal burden on state coffers or that their exclusion would improve the quality of education. In addition, Brennan said, federal immigration policy was not concerned with conserving state educational resources, much less with denying an education "to a child enjoying an inchoate federal permission to remain."69 (This referred to the possibility that an illegal alien might obtain discretionary relief from deportation.) All the Texas law would serve to do, Brennan said, was to promote "the creation and perpetuation of a subclass of illiterates,"70 who would be socially dysfunctional and a burden to society. That, he said, clearly was not something the states were allowed to do.

The parallels from Plyler to Proposition 187 were obvious. Both would in effect bar undocumented children from the public schools; if anything, California's new ban on enrolling such children was even more categorical and rigid than the Texas statute invalidated in Plyler. Any court that accepted Brennan's premises in Plyler would have had difficulty sustaining Proposition 187.7

If aliens remained in the United States, paid taxes and became part of the

community, their misfortunes had to be dealt with, for their sake and that of society. A lesson from Plyler was that children could not be punished for evasion of immigration laws, and, if they were allowed to remain here, they would be educated (and otherwise cared for) in the general community interest. A second lesson was that aliens came to


69 Ibid.

To Ibid.
71 Ibid.






80

the United States primarily to work-not for schools or medical care or other public benefits.72


Conflict with Federal Laws

The 5-4 opinion in Plyler brought out two conflicting themes, variations of which appeared in the Proposition 187 litigation. First, the undocumented status of aliens might itself have been sufficient basis for denying governmental benefits that it provided to others. However, control of immigration was within the exclusive purview of the federal government. While "the States did have some authority to act with respect to illegal aliens, at least where such action mirrored federal objectives and furthered a legitimate state goal," the disability imposed on the students did not correspond with "any identifiable congressional policy," and, more important, the classification of undocumented students "did not operate harmoniously within the federal program."73

The compelling consideration for the Plyler Court was how the statute hurt

innocent children and society. These considerations were conclusive: "Illiteracy was an enduring disability. The inability to read and write would handicap the individual deprived of a basic education each and every day of his life. In determining the rationality of [the statute], one must appropriately take into account its costs to the Nation and to the innocent children who are its victims."74 72 Mailman, 187 and Its Lessons, p.3, col. 1.
73 457 U.S. at 225-26, citing De Canas v. Bica, 424 U.S. 351 (1976), as cited in Mailman, 187 and Its Lessons, p.3, col..
74 457 U.S. at 222, 223-24. Constrained by its earlier holding in San Antonio School District v Rodriguez, 411 U.S. 1 (1973), that education is not a "fundamental right," and given its opinion that undocumented status is not a "constitutional irrelevancy," the Court applied an intermediate rather than strict scrutiny test.






81


How did Plyler control the constitutionality of Proposition 187? From Judge Pfaelzer's verbal decision, Plyler directly affected only those who sought to enter or remain in elementary or secondary schools; those in the university system would not be protected.75 However, elements of Plyler were brought into a more general constitutional attack on Proposition 187, relating to the supremacy of federal legislation over the subject of immigration. Congress unquestionably had authority to legislate on immigration and had exercised that power comprehensively in "regulating authorized entry, length of stay, residence status, and deportation," and in the treatment of aliens otherwise.76 In defining who received benefits, Congress had positioned immigration classifications into the framework of various public assistance programs.77

Additionally, under Proposition 187, frontline, untrained state employees decided who "had apparent illegal status" or was here "in violation of law" and therefore ineligible for benefits.78 Those who conveyed the bad news were deputized to direct the applicant to leave the country, effectively to issue what could have easily been taken as a deportation order. Yet, the Immigration and Nationality Act provided that such an order could be issued only by an immigration judge after a hearing on a record, with the government bearing the burden of proof, and the alien having a right to counsel.79 Furthermore, PRUCOL (permanent resident) aliens by definition had INS permission to 7s 457 U.S. at 219.

76Gonzales v. City of Peoria, 722 F2d 468, 474-75 (9" Cir. 1983). 77 Janet M. Calvo, "Alien Status Restrictions on Eligibility for Federally Funded Assistance Programs," 16 New York University Review of Law & Social Change, 395 (1987-88).
7 Proposition 187, Sec. 5-7.

79 INA Sec. Sec. 242(b), 292, 8 USC Sec.Sec. 1252(b), 1362.






82

stay in the United States; and many aliens, although deportable, could have been granted discretionary relief that allowed them to remain.80s Here, too, the California statute conflicted with federal legislation.8'


Due Process

Plaintiffs also argued that Proposition 187's procedure violated the Fourteenth

Amendment's Due Process clause by threatening to take away valuable rights or interests without a prior hearing. Public assistance, for example, was an interest that could not be cut off without a pre-termination hearing.82 Due process also required a hearing before a deportation order could be entered.83 Proposition 187 therefore violated the Constitution when it instructed state employees to terminate a woman's pre-natal care or turn a child out of school and then directed the parties to leave the United States -- without a hearing or other means of evaluating their rights.84

The same equal protection, supremacy and due process provisions that controlled Proposition 187, challenged other states as they considered what to do about undocumented aliens. And a state law must also have passed muster under its own constitution. For example, a provision of New York's constitution that mandated support of the needy, "unequivocally prevents the Legislature from simply refusing to aid those


8 See, e.g., INA Sec.Sec.208, 243(h), 24, 245, USC Sec.Sec.1158, 1252(h). s1 Mailman, 187 and Its Lessons, p.3, col. 1.
82 Goldberg v. Kelly, 397 U.S. 254 (1970).
83 Wong Yang Sung v. McGrath, 339 U.S. 33 (1950), modified, 339 U.S. 908. Mailman, 187 and Its Lessons, p.3, col. 1.






83

whom it has classified as needy."85 Under California's own equal protection provision, education was treated as a matter of "fundamental interest" whose "unique importance.. Sin California's constitutional scheme required careful scrutiny of state interference with basic educational rights."86 That was why some California plaintiffs attacked Proposition 187 in their state court, urging the Plyler analysis.87

Proposition 187, like the "Official English" laws approved in California and

elsewhere since the mid-1980s, was a symbolic message to policy elites. These measures were grand gestures with few practical consequences other than to convince politicians that many voters viewed American society as increasingly alien (literally) and uncontrollable. Voters responded angrily to the vivid television images of Mexican officials denouncing the measure and to the marchers in Los Angeles waving Mexican flags and protesting its limits on welfare benefits. On election day, the voters indicated that illegal immigrants, industrious as they were, were part of the problem and that Proposition 187, crude as it was, was part of the solution. It was no solution, of course, but that only underscored the need for a sounder political response in order to forestall future initiatives of this kind.

The U.S. Congress was far less constrained than the states in the classification of aliens, having a preeminent role in their regulation.88 As the Supreme Court has said, "Over no conceivable subject is the legislative power of Congress more complete."89 85 See New York Constitution, Article XVII; Tucker v. Toia, 43 NY2d 1, 8 (1977). 86 See California Constitution, Article I, Sec.7(a). See also Serrano v. Priest, 18 Cal3d 728, 767-68 (1976). 87 Mailman, 187 and Its Lessons, p.3, col. 1.

88 See Toll v. Moreno, 458 U.S. I, 10 (1982).
89 See Mathews v. Diaz, 426 U.S. 67 (1976).






84


It made little sense for Congress to legislate in the areas of immigration and

public assistance without reviewing the precedent immigration laws and policies under which the affected aliens were here; and the reduction in federal programs was no saving if it simply shifted their costs to the states and communities where the aliens and their families lived.9


Immigration And Education

Many states, particularly those with the highest percentages of illegal immigrants were concerned over the expenses they incurred by providing public social services and educational benefits to illegal immigrants. Only the federal government could enact immigration policy,9' to which states must adhere. Some state challenges to federal immigration policy focused considerable public interest on the immigration issue, both legal and illegal, and the lack of adequate funding to carry out the required mandates of the policies.

Because the federal courts made immigration legislation, the states had the

obligation to follow the mandates. Little if any funding followed policy, often leaving the states with the largest numbers of legal as well as illegal immigrants, with more than their share of the overwhelming costs of educating the children.

In the wave of anti-immigrant sentiment, other states had made proposals to bar undocumented immigrant students from attending public schools, counter to federal efforts to keep students in school rather than out. Virginia, for instance, required its



9 See Plyler v. Doe, 457 U.S. 202, 225 (1982). Cf. DeCanas v. Bica, 424 U.S. 351(1976). 9' Ibid.






85

schools to verify the legal status of all students over 18 years of age enrolled in English as a Second Language programs, and of all students over 20 who entered the U.S. after the age of 12, or risk losing some state funding.92

An initiative similar to Proposition 187 was proposed by Rep. Elton Gallegly93 as an amendment to the omnibus immigration reform bill (H.R. 2202) in 1996. The amendment attempted to combine two entirely different issues into one bill. Joining efforts to secure our borders with reforms to our system of legal immigration served only to confuse the debate.94 It played on the public's understandable concern over illegal immigration but twisted that concern into the misguided notion that all immigration was harmful and all immigrants were undocumented, sneaking into our country by night. Neither notion, of course, was true, but dealing with illegal and legal immigration in one bill served to fuel hostility and even prejudice toward all immigrants. The amendment would have authorized states to deny public education to the children of illegal aliens. It would have denied American citizens and legal permanent residents the opportunity to bring close relatives into the United States. H.R. 2202 would also have increased the income a family needed to bring a family member up to a level that denied 40 percent of Americans the chance to reunite with loved ones.95 The provision was passed by the full House of Representatives but was eliminated by the conference committee--because no vote had been taken in the Senate on this issue. But the measure was again passed as a 92 Ibid.
9 Charles Levendosky, "The Politics of Turning Children into Victims," Casper (Wvo.) Star Tribune, May 1996.
9 Gimpel and Edwards, Immigration Reform.
95 Serrano, House of Representatives, .






86

separate bill in the House.96 One version of the proposal would have denied public education to children who were illegal aliens themselves, rather than all children of illegal aliens (which would have included some U.S. born, citizen children). The bill failed to address the fact that employment was the primary reason immigrants, whether legal or illegal, came to this country.97

Supporters of the Gallegly Amendment argued that America's education system, like other social-service programs, attracted a disproportionate number of immigrants and that the cost of educating such children was too high in an era of tight school budgets. Opponents of the measure denounced it as cruel; hundreds of thousands of children would potentially be turned away at the schoolhouse door.98 A portion of the Gallegly amendment read:

"Congress declares it to be the policy of the United States
that ... aliens who are not lawfully present in the United States not be entitled to public education benefits in the same manner as
United States citizens and lawful; resident aliens. ."99


The House bill allowed states to make their own determination about whether the public schools would be open to children of illegal immigrants. The amendment did not provide for Immigration and Naturalization Service officials to enter schools and it did not provide funds for schools to hire people. The public schools have traditionally


9 Charles Levendosky, "The Politics of Turning Children into Victims," Casper (Wvo.) Star Tribune, May 1996.
97 Gimpel, James G. and Edwards, James R. Jr., 1999. The Congressional Politics of Immigration Reform, Needham Heights, MA, Allyn & Bacon.
98 "Illegal Immigrant Children: In or Out of Public Schools?" Education Week, April 1996. .
SGallegly Amendment, H. R. (2022), 1996.






87

educated all the children who came through their doors. The Gallegly provision would have turned teachers and school administrators into substitute INS officers?

Adding a new dimension to the issue was the North American Free Trade

Agreement (NAFTA)lol that had been negotiated by the United States, Mexico, and Canada. The agreement created a regional trading bloc of 370 million people by lowering trade barriers among the three countries. The agreement was designed to reduce the flow of illegal aliens by creating better-paying jobs in Mexico. Even though the trade agreement was approved, some experts on illegal immigration argued that the United States needed to focus greater attention on developing the economies of Mexico and its neighbors to keep potential illegal aliens at home. They maintained that increased foreign aid to the countries of Latin America and incentives for low-wage American industries to invest in the region were necessary to generate more local jobs. A hope of this measure was the elimination of the need for further legislation on the illegal immigrant issue.

American society had changed, and part of the "difference" sustained those Americans still confident about our assimilative capacity--some of which mistakenly assumed that mass immigration was a constant historical fixture of American society

As the influx of immigrants continued and the number of immigrant children

enrolled in the public education system grew, school systems expanded along with them. Statistics showed that, in spite of the many obstacles immigrant children overcame as new students in a new country, they persevered and some did as well if not better than 10 Charles Levendosky, "The Politics of Turning Children into Victims," Casper (Wyo.) Star Tribune, May 1996
1O1 North American Free Trade Agreement, August 1992.






88

U.S. natives. As they completed their public education, many chose to pursue their education further and enrolled in colleges and universities. Although immigrants were less likely to have graduated from high school, they were more likely to graduate from college when compared to the U.S. native population.102

Justice Brennan'o3 used the inherent difficulty of immigration control as a

justification for making it even more intractable. He assumed that exclusion from the schools was a wholly ineffective way to influence immigrants' behavior, yet it was surely true that at least some parents were less likely to immigrate if they knew their children would be denied schooling. Illegal aliens always had alternatives. They could return home or refrain from coming in the first place. These options seemed harsh but they followed directly from the premise of national territorial sovereignty, a premise that the Court had always affirmed.14

While the federal government moved to curb illegal migrants, it never cut off many of their benefits, notably including public education in federally assisted schools and emergency Medicaid services. The courts could have taken this inaction to mean that Congress remained satisfied with Plyler and did not wish to undermine the decision's rationale.'o5

Political leaders needed to recognize that illegal immigration was not an

unmitigated evil and that immigration enforcement competed for resources with other


102Schuck, Illegal Immigration, pp. 85-92.
10o3 Ibid.

'04 Ibid.
105 Ibid.






89


social goals. Although it was hard to admit that the U.S. tolerated some lawbreakers as a matter of policy, the fact was that it did--and always would. The U.S. was a large country with relatively low population densities even in the cities, and with a vast economy that needed more unskilled labor than U.S. nationals were willing to supply at existing wage levels. It continued to assimilate a significant number of illegal aliens so long as the costs were not too high or too localized. 106

If the enforcement policy "allowed" illegal aliens to enter and remain long-term (but illegal) residents, then Brennan was surely right: there was little point, and even less justice, in consigning them to lives of ignorance, dependency, and discrimination by denying them education--a denial that would injure not only them but the American communities in which they would live and work. For much the same reason, they were permitted to receive emergency medical care. 107

But misguided as such measures as Proposition 187 and the Gallegly Amendment were, they did have the effect of forcing us to consider anew what it meant for the U.S. to be a nation of immigrants at a time when the core values of legality, national sovereignty, and self-reliance were under extraordinary pressures from within and without.

Since immigration policy, both legal and illegal, was the duty of the federal

government, it was unfair to make states like Texas, California, and Florida, which bore the burden of most illegal immigrants, pay for the government's federally mandated services. Because of the government's inability to control effectively the flow of illegal "06 Ibid.
107 Ibid.






90


immigrants crossing the border, it should have reimbursed these states for the expenses incurred in providing services to illegal aliens.

Justice Department lawyers indicated that the government spent more than $1 billion a year on immigration enforcement and returned more than one million immigrants to their homelands. The lawyers pointed to those actions as demonstrations that there had been no abdication of federal responsibility.08 Reimbursing the states was only a small portion of what the federal government could have done to relieve the burden that the social and educational needs of illegal immigrants have put on this nation. 19


Florida Immigration and Education

Due to Florida's geographical position, it attracted a disproportionate number of legal as well as illegal immigrants. Florida was the state with the fourth largest illegal immigrant population, behind California, New York and Texas, in 1997.10 This growth in numbers resulted in an increased demand for state services such as emergency health care, education and incarceration, and in turn, increased the state expenditures for providing these services)."'


0" Ibid.

09 Ibid.

n0 Joyce C. Vialet and Larry M. Eig, Immigration and Federal Assistance: Issues and Legislation, Congressional Research Service Issue Brief, April 18, 1996. ". Ibid.




Full Text
185
concedes, this only begins the inquiry.134 The Equal Protection Clause does not
mandate identical treatment of different categories of persons. The dispositive issue in
these cases, simply put, is whether, for purposes of allocating its finite resources, a state
has a legitimate reason to differentiate between persons who are lawfully within the state
and those who are unlawfully there.136 The distinction the State of Texas has drawn
based not only upon its own legitimate interests but on classifications established by the
Federal Government in its immigration laws and policies is not unconstitutional. A
The Court acknowledges that, except in those cases when state classifications
disadvantage a suspect class or impinge upon a fundamental right, the Equal
Protection Clause permits a state substantial latitude in distinguishing between different
groups of persons. Moreover, the Court expressly and correctly -- rejects any
suggestion that illegal aliens are a suspect class,137 or that education is a fundamental
right.138 Yet by patching together bits and pieces of what might be termed quasi-suspect-
class and quasi-fundamental-rights analysis, the Court spins out a theory custom-tailored
to the facts of these cases.
In the end, we are told little more than that the level of scrutiny employed to strike
down the Texas law applies only when illegal alien children are deprived of a public
134 Ibid., p. 215.
135 Jefferson v. Hackney, 406 U.S. 535, 549 (1972); Reed v. Reed, 404 U.S. 71, 75 (1971); Tigner v. Texas,
310 U.S. 141, 147-148 (1940).
136 [457 U.S. 244]
137 Ibid., p. 219, n.19.
138 Ibid., p. 221,223.


159
may fairly be viewed as furthering [457 U.S. 219] a substantial interest of the State. We
turn to a consideration of the standard appropriate for the evaluation of 21.031. A
Sheer incapability or lax enforcement of the laws barring entry into this country,
coupled with the failure to establish an effective bar to the employment of undocumented
aliens, has resulted in the creation of a substantial shadow population of illegal
migrants numbering in the millions -- within our borders.39 This situation raises the
specter of a permanent [457 U.S. 219] caste of undocumented resident aliens, encouraged
by some to remain here as a source of cheap labor, but nevertheless denied the benefits
that our society makes available to citizens and lawful residents.40 The existence of such
an underclass presents most difficult problems for a Nation that prides itself on adherence
to principles of equality under law.41
39 [The Attorney General recently estimated the number of illegal aliens within the United States at between
3 and 6 million. In presenting to both the Senate and House of Representatives several Presidential
proposals for reform of the immigration laws including one to legalize many of the illegal entrants
currently residing in the United States by creating for them a special status under the immigration laws --
the Attorney General noted that this subclass is largely composed of persons with a permanent attachment
to the Nation, and that they are unlikely to be displaced from our territory: We have neither the resources,
the capability, nor the motivation to uproot and deport millions of illegal aliens, many of whom have
become, in effect, members of the community. By granting limited legal status to the productive and law-
abiding members of this shadow population, we will recognize reality and devote our enforcement
resources to deterring future illegal arrivals. Joint Hearing before the Subcommittee on Immigration,
Refugees, and International Law of the House Committee on the Judiciary and the Subcommittee on
Immigration and Refugee Policy of the Senate Committee on the Judiciary, 97th Cong., 1st Sess., 9 (1981)
(testimony of William French Smith, Attorney General). Ed.]
40 [As the District Court observed in No. 80-1538, the confluence of Government policies has resulted in
the existence of a large number of employed illegal aliens, such as the parents of plaintiffs in this case,
whose presence is tolerated, whose employment is perhaps even welcomed, but who are virtually
defenseless against any abuse, exploitation, or callous neglect to which the state or the state's natural
citizens and business organizations may wish to subject them. 458 F.Supp. pp. 585. Ed.]
41 [We reject the claim that illegal aliens are a suspect class. No case in which we have attempted to
define a suspect class, see, e.g., n. 14, has addressed the status of persons unlawfully in our country. Unlike
most of the classifications that we have recognized as suspect, entry into this class, by virtue of entry into
this country, is the product of voluntary action. Indeed, entry into the class is itself a crime. In addition, it
could hardly be suggested that undocumented status is a constitutional irrelevancy. With respect to the
actions of the Federal Government, alienage classifications may be intimately related to the conduct of
foreign policy, to the federal prerogative to control access to the United States, and to the plenary federal
power to determine who has sufficiently manifested his allegiance to become a citizen of the Nation. No


APPENDIX
146
LIST OF REFERENCES 196
LEGAL REFERENCES 203
BIOGRAPHICAL SKETCH 207
vi


89
social goals. Although it was hard to admit that the U.S. tolerated some lawbreakers as a
matter of policy, the fact was that it didand always would. The U.S. was a large
country with relatively low population densities even in the cities, and with a vast
economy that needed more unskilled labor than U.S. nationals were willing to supply at
existing wage levels. It continued to assimilate a significant number of illegal aliens so
long as the costs were not too high or too localized. 106
If the enforcement policy allowed illegal aliens to enter and remain long-term
(but illegal) residents, then Brennan was surely right: there was little point, and even less
justice, in consigning them to lives of ignorance, dependency, and discrimination by
denying them educationa denial that would injure not only them but the American
communities in which they would live and work. For much the same reason, they were
permitted to receive emergency medical care. 107
But misguided as such measures as Proposition 187 and the Gallegly Amendment
were, they did have the effect of forcing us to consider anew what it meant for the U.S. to
be a nation of immigrants at a time when the core values of legality, national sovereignty,
and self-reliance were under extraordinary pressures from within and without.
Since immigration policy, both legal and illegal, was the duty of the federal
government, it was unfair to make states like Texas, California, and Florida, which bore
the burden of most illegal immigrants, pay for the governments federally mandated
services. Because of the government's inability to control effectively the flow of illegal
106 Ibid.
107 Ibid.


31
the original settlers of the United States. After that date, immigration from northern
Europe declined, while that from southern Europe and from Russia rapidly increased.
This so-called new immigration produced a change in the American attitude toward
unlimited immigration. Until World War I, the immigration laws were designed only to
exclude certain undesirable categories, including the feeble-minded, insane, epileptics,
sufferers from certain contagious diseases, paupers, criminals, prostitutes, polygamists,
anarchists, and those convicted of, or admitting to, crimes or misdemeanors involving
moral turpitude. The importation of labor under contract was also forbidden.4
Asiatic immigration was restricted, first, by the Chinese Exclusion Act of 1882,5
re-enacted in 1892 and in 1902, whereby all immigration from China, except students,
merchants, and a few other classes, was forbidden.6 Not until December 1943, was the
exclusion law repealed, and the Chinese placed on the same footing as other immigrants
After 1900, when Japanese immigration into California became notable, an exclusion
league was organized in that state and agitation was initiated to secure legislation
forbidding the admission of Japanese. In 1907, when an immigration bill restricting the
admission of Japanese and Korean laborers was introduced into Congress, the president
secured in its place the Congressional authority to suspend Japanese and Korean labor
immigrants coming from our insular possessions or from Canada or Mexico. An
agreement was made between the United States and Japanthe so-called gentlemens
4 Ibid.
5 Chinese Exclusion Act, ch. 126,22 Stat.58. 1882.
6 The Lincoln Library of Essential Information.


98
From there, the issue became the unfairness that certain states with exceptionally large
immigrant populations had to carry so much of the financial burden of providing those
services.140 School systems in these states became fiscally strained. To eliminate these
overburdened costs, legislation was introduced to deny social service and health care
benefits, and especially educational benefits to illegal immigrants.141 Although the
legislation was defeated, it succeeded in bringing to the forefront the issue of enforcing
borders and immigration laws.
Considering the history of the litigation on behalf of and against the illegal
immigrant student, the educational mandates that resulted from the litigation, remained,
and children of illegal immigrants faired better in school with each passing generation.
The teachers were better prepared, the materials were more relevant and there were more
bi-lingual students to assist the newest immigrant student with the transition from
language to language and from culture to culture. Floridas dilemma then, with the rising
numbers of immigrants and the minor support it received in services and funding from
the federal government, was how to continue to provide the needed services, including
education, to these immigrant children and their families.
139 Plyler, 457 US 202 (1982).
140 Proposition 187.
141
Ibid.


155
Clause was intended to work nothing less than the abolition of all caste-based and
invidious class-based legislation. That objective is fundamentally at odds with the power
the State asserts here to classify persons subject to its laws as nonetheless excepted from
its protection. [457 U.S. 214]
The congressional debate concerning Article 1 of the Fourteenth Amendment was
limited, that debate clearly confirms the understanding that the phrase within its
jurisdiction was intended in a broad sense to offer the guarantee of equal protection to
all within a State's boundaries, and to all upon whom the State would impose the
obligations of its laws. Indeed, it appears from those debates that Congress, by using the
phrase person within its jurisdiction, sought expressly to ensure that the equal
protection of the law was provided to the alien population. Representative Bingham
reported to the House the draft resolution of the Joint Committee of Fifteen on
Reconstruction30 that was to become the Fourteenth Amendment.31 Two days later,
Bingham posed the following question in support of the resolution:
Is it not essential to the unity of the people that the citizens of each State shall be
entitled to all the privileges and immunities of citizens in the several States? Is it not
essential to the unity of the Government and the unity of the people that all persons,
whether citizens or strangers, within this land, shall have equal protection in every State
in this Union in the rights of life and liberty and property?32
30 H.R. 63.
31 Congressional.Globe, 39th Cong., 1st Sess., 1033 (1866). [Representative Bingham's views are also
reflected in his comments on the Civil Rights Bill of 1866. He repeatedly referred to the need to provide
protection, not only to the freedmen, but to the alien and stranger, and to refugees ... and all men.
Congressional Globe, 39th Cong., 1st Sess., 1292 (1866). Ed.]
32 Ibid., p. 1090.


71
the Border Patrol in Texas arrested would-be immigrants from 43 countries.43 The 1986
Act44 was intended to cut off the flow of illegal aliens by penalizing employers who hired
them. In fact, illegal aliens in many areas had little difficulty obtaining false documents
to qualify for jobs that were readily available.
The cost of providing social services to illegal aliens was also part of the border
control debate. Although nearly 3 million illegal aliens were legalized by the 1986 act,
census figures indicated that 3 million to 4 million illegal aliens lived in the United States
according to 1990 Census figures.45 Like all immigrants in general, the illegal aliens
were concentrated in a few states, primarily California, Texas, Florida, Illinois, and New
York.
In 1982, the Supreme Court ruled that states must provide illegal aliens with
schooling.46 That decision, along with the growing proportion of women and children
among the illegal alien population, added to the education and health care budgets of
several states.
43 Schuck, Illegal Immigration.
44 Immigration Reform and Control Act of 1986, Public Law 99-603.
45 U.S. Census, 1990.
46 Plyler, 457 U.S. 220 (1982).


187
hostility; it is not an all-encompassing equalizer designed to eradicate every distinction
for which persons are not responsible. [457 U.S. 246]
The Court does not presume to suggest that appellees' purported lack of
culpability for their illegal status prevents them from being deported or otherwise
"penalized" under federal law. Yet would deportation be any less a penalty than denial
of privileges provided to legal residents? Illegality of presence in the United States does
not and need not depend on some amorphous concept of guilt or innocence
concerning an alien's entry. Similarly, a state's use of federal immigration status as a
basis for legislative classification is not necessarily rendered suspect for its failure to take
such factors into account.
The Court's analogy to cases involving discrimination against illegitimate children
is grossly misleading.142 The State has not thrust any disabilities upon appellees due
to their status of birth.143 Rather, appellees' status is predicated upon the circumstances
of their concededly illegal presence in this country, and is a direct result of Congress
obviously valid exercise of its broad constitutional powers in the field of immigration
and naturalization.144 This Court has recognized that, in allocating governmental benefits
to a given class of aliens, one may take into account the character of the relationship
between the alien and this country.145 When that relationship is a federally prohibited
142 Ibid., p. 220; (POWELL, J concurring).
143 Cf. Weber v. Aetna Casualty & Surety Co., 406 U.S. 164, 176 (1972).
144 U.S.Const., Art. I, 8, Cl. 4; see Takahashi v. Fish & Game Commission, 334 U.S. 410,419 (1948).
145 Mathews v. Diaz, 426 U.S. 67, 80 (1976).


46
District, which was named in the case by certain named and unnamed undocumented
alien children.75
Mexican children who had entered the United States illegally and resided in Texas
sought injunctive relief against exclusions from public schools pursuant to a Texas statute
and school district policy. The United States District Court for the Eastern District of
Texas,76 William Wayne, Justice, permanently enjoined defendants, and the defendants
appealed. The Court of Appeals for the Fifth Circuit77 affirmed. Probable jurisdiction
was noted.
The Supreme Court, under Justice Brennan,78 in the majority opinion, held that:
(1) the illegal aliens who were the plaintiffs could claim the benefit of the equal
protection clause, which provided that no state could deny to any person the benefit of
jurisdiction in the equal protection of the laws; whatever his status under the immigration
laws, an alien was a person in any ordinary sense of that term. This Court's prior cases
recognized that illegal aliens were persons protected by the Due Process Clauses of the
Fifth and Fourteenth Amendments, which Clauses do not include the phrase within its
jurisdiction, could not be distinguished on the asserted ground that persons who had
entered the country illegally were not within the jurisdiction of a State even if they were
present within its boundaries and subject to its laws. Nor did the logic and history of the
Fourteenth Amendment support such a construction. Instead, use of the phrase within
75 Ibid.
76 458 F. Supp. 567.
77 628 F. 2d 448.
Plyler, 457 U.S. 245.


30
could we admit? This was essentially the question immigration law and policy had to
address. States could not make their own policies on immigration admissions.
Immigration policy was the overarching responsibility of the national government,
chiefly, the legislative branch.1
American immigration policy was alleged to rival the federal tax code in its
complexity. Federal immigration laws, beginning with the act of 1875, served three
general purposes: to deny admission, to facilitate entrance for qualitative reasons and to
limit the number of entrants.2
The power of a nation to deny admission of a foreigner to its territory was a right
under international law that had been exercised in all times. Complete exclusion of
foreigners and the denial of free communication with foreign nations, however, had been
treated as an act of unfriendly or hostile character, and against it nations have applied
forceful methods. In this manner, the foreign exclusion policy imposed upon China by
the Manchu Dynasty was broken by European nations, even at the cost of war; and in
1854 the United States, by a naval demonstration by Commodore Perry, coerced the
government of Japan into abandoning its policy of non-communication with foreign
nations, which had been in place for nearly 250 years.3
Immigration into the United States had passed through several phases. Prior to
1880, immigration consisted almost exclusively of peoples of northern Europe, who were
1 James G. Gimpel and James R. Edwards, Jr The Congressional Politics of Immigration Reform, Boston,
Allyn and Bacon, 1999.
2 Ibid.
3 The Lincoln Library of Essential Information. 35th ed., s.v. Immigration. Frontier Press: Columbus,
Ohio, (1972).


LD
1780
2QJ2
emaKVKswwv* wanwyar
,^¡V,ERS|ty OF FLORIDA
3 1262 08555 1520


63
benefit programs were open to United States citizens and to those aliens who had been
lawfully admitted as permanent residents.
In addition, several important programs, including Aid to Families with
Dependent Children (AFDC)9, Supplemental Security Income (SSI)10 and Medicaid,"
covered PRUCOLs.12
To be admitted to the United States in any capacity, an alien needed to prove he
or she was not likely at any time to become a public charge.13 A common way to
establish that was to submit an affidavit of support from an American sponsor, who
was willing and able to provide financial backing. For purposes of assessment of
financial eligibility under various federal benefit programs, however, a portion of the
9 Aid to Families with Dependent Children (AFDC). The AFDC program provided assistance for basic
needs such as food and shelter to qualifying families with children. The families met certain income,
immigration status and other qualifications to receive AFDC. The federal government and the states jointly
funded the program. Those persons not eligible included undocumented aliens and those undocumented
aliens who became legalized as a result of 1986 IRCA.
10 Supplemental Security Income (SSI). Aged, blind, and disabled persons whose income fell below
specified levels received cash payments under the Supplemental Security Income program. As SSI eligible
residents were automatically eligible for Medicaid, any change in such status and denial of Medicaid had an
impact on health care costs for local providers.
11 Medicaid. Medicaid was a joint state/federal program designed to provide medical assistance to
financially needy individuals. The program was an automatic benefit for those individuals who received
AFDC or SSI direct assistance. Potential recipient families met certain income, citizenship and other
qualifications to receive Medicaid. Individuals not eligible included undocumented aliens and former
undocumented aliens who became legalized as a result of the 1986 IRCA. Except for emergency Medicaid
coverage which included emergency labor and delivery.
12 CIR.
13 Ways And Means Committee Print: 104-14 [1996 Green Book] "Appendix J. Noncitizens" The Personal
Responsibility and Work Opportunity Reconciliation Act and Associated Legislation, 1996,
(25 February 1997). Public charge was a term used in immigration
law to describe someone who was, or likely to become, dependent on public benefits. In practice, public
charge considerations have historically been a factor in the admissibility of aliens.


7
17
policy. Congress liberalized Asian immigration during and shortly after World War
II.18 On June 27, 1952, the McCarran-Walter Act19 effectively altered the immigration
policy of the United States by removing racial bias from the setting of national origin
quotas, since particular immigrants could not be excluded on account of race. The 1952
Act retained the 1920 quota base.20 Senator McCarran maintained that the nation had
always been besieged by immigrants and that ending the national origins system would
cause further conflict in an ethnically altered United States.21 McCarran wanted to end
racial discrimination in immigration admissions, but he felt that the United States could
best serve its mission in the world by remaining true to its culture and by assimilating
non-Europeans very slowly.22 The justifications of cultural unity, which had so
concerned Congress, never dominated immigration debates after 1952.
The confidence and determination to confront Americas history of racism
continued with renewed fervor during the decade of the 1960s. Congress passed such
17 Gregg Van De Mark Too Much of a Good Thing, Washburn Law Journal 35, no. 3 (Spring 1996)
.
18 Congress repealed the Chinese Exclusion Act by the Act of December 17, 1943 (ch. 344, 57 Stat 600
(formerly codified at 8 U.S.C. §§ 262-97, 299)).
19 McCarran-Walter Act, ch. 477,66 Stat. 1633, 8 U.S.C. § 1101, 1952.
Ibid.
21 CONGRESSIONAL RECORD, pt 4, p. 5330 (1952).
22
Ibid.


74
withheld from local school districts any state funds for the education of any child who
was not legally admitted into the United States. There the Court held that a Texas statute
that effectively denied undocumented children a public-school education violated the
Fourteenth Amendment's Equal Protection Clause.50 Bearing the extra expense of
providing an education and services to undocumented children was felt by Texas voters
to be extremely unfair in light of the fact that these children and their parents were not
supposed to be in the state in the first place.51
Proposition 187
Out of similar frustration over the expenses of illegal immigration to the state, the
voters of California enacted Proposition 187 in 1994.52 The statute was a dramatic effort
to drive out undocumented aliens and to deter their entry by cutting them off from
medical and other public services and depriving their children of an education.53 It was
described in the official ballot argument as the first giant stride in ultimately ending the
ILLEGAL ALIEN invasion. The text read as follows.
PROPOSITION 187 (Text of Proposal)
Any person who manufactures, distributes, or sells documents to
conceal the true citizenship or resident alien status of another
person is guilty of a felony, and shall be punished by imprisonment
in the state prison for five years or by a fine of seventy-five
thousand dollars.... Any person who uses false documents to
conceal his or her true citizenship or resident alien status is guilty
of a felony, and shall be punished by imprisonment in the state
50 Plyler, 457 U.S. 202 (1982).
51 Ibid.
52
Proposition 187 was approved by the electorate of California on November 8, 1994, as an initiative
statute. See 1994 Cal. Legis. Serv., Prop. 187 (Westlaw).
53
Ibid.


23
families than Americans, which meant more children per family in need of bilingual
education and special services.83
As of 1993, approximately 60 percent of all foreign-bom people residing in the
United States came to this country during the decade of the 1980s.84 About 9 million
immigrants came during those years, increasing the U.S. population by 6 percent. The
children of these immigrants, about 2 million of them, enrolled in school, increasing
enrollment in English as a Second Language classes by 50 percent. Five states had
carried the burden of this wave, according to Rand. More than 70 percent of all
immigrants lived in California, New York, Texas, Florida, and Illinois.85
The Center for Immigration Studies estimated an additional 50 percent cost to
educate a student with limited English proficiency than one who was fluent in English.
But opponents in the immigration debate disagreed over whether immigrant families
produced enough tax revenue to pay for the extra services they received. Immigrant-
rights groups said that immigrants, including illegals, paid enough taxes to cover the
costs of educating their children. According to the Urban Institute, local, state, and
federal governments spent some $42.9 billion a year in services for immigrants, including
$11.8 billion for educating legal and illegal immigrant children. This expense was more
than offset by the taxes legal and illegal immigrant families paid$70.3 billion a year,
according to the Urban Institute. But in 1992, Rice University professor Donald Huddle
put the cost of educating immigrants at $16.4 billionand the total cost for services for
83 Vail, No Entry pp. 19-25.
84 Lorraine M. McDonnell and Paul T. Hill, Newcomers in American Schools: Meeting the Educational
Needs of Immigrant Youth, Santa Monica, Calif.: RAND, MR-103-AWM/PRIP, 1993.
85 Ibid., p. 22.


41
some condescension, that population pressures in what is now termed the Third World
would not encourage emigration;54 he could not have been more wrong.55
Congress designed the 1965 Act to provide a level playing field among emigrant
sending nations without concentrating on any one region.56 The 1965 Act was not
designed to transform the culture or the demographic character of the United States. Yet,
the actual effects of the 1965 Act were dramatic.57 Because of the family reunion
policies, the first immigrants who came into the United States after the 1965 Act clogged
the system through chain migration of relatives, who in turn brought in their relatives
and created an enormous backlog of people waiting to be processed.58 As a result of the
surge in immigration and refugees from Third World nations after 1965, over eighty
percent of annual legal entrants to the United States were from Latin America, the Pacific
Islands, and Asia.59
Immigration resulting from the 1965 Immigration Act altered the demographic
makeup of the United States over a mere thirty-year period. In 1960, one out of ten
54 David Rieff, Los Angeles: Capital Of The Third World, Harcourt Brace: New York, pp. 178-180 (1991).
55 Population growth and migration pressures in the Third World provide the strongest contributions to the
immigration problem. See, e.g., United Nations Population Fund, The State Of World Population 1993
(1993).
56 Immigration Act of 1965, Pub. L. No. 89-235, 79 Stat. 911.
57 Almost 3 million Hispanics immigrated during the 1980s, contrasted with about 1.5 million during the
1970s. The Hispanic population increased by 53%. (By comparison the number of non-Hispanic African-
Americans increased by 13%. The United States also admitted 315,000 immigrants from Africa and Haiti
during the 1980s. Between 1980 and 1990, the Asian-American population grew by 107.8%. Immigration
And Naturalization Service, U.S. Department Of Justice 1990 Statistical Yearbook 50 (1991) [hereinafter
Statistical Yearbook],
58 Peter Brimelow, Alien Nation: Common Sense About America's Immigration Disaster, p. 81 (1995).
59 Ibid., pp. 77-84.


140
90
Islander students (39 percent), and Naive American students (6 percent).
School counseling staffs were composed mostly of white or black women.
Incentives were needed to entice more Hispanics and men into the school
counseling field.
6) Increased immigrant parent involvement in overall school programs;
A prelude to more effective parent involvement programs should have
included a careful examination of what was actually known about
culturally different families, their attitudes regarding education and how
they supported their childrens education through the family and their
informal social networks. It was important to help the immigrant parent to
understand the U.S. educational system. Immigrant parents often came
from cultures where the proper role of the concerned parent was non
interventionist in nature. Parents from such background believed they
should not intervene in the schools business or question the teachers
practices and expertise. Most Hispanic parents felt parent intervention
constituted of interference in the affairs of the school. Many did not
understand that they were expected to interact with schools to show that
they valued education and wanted their children to learn.30 As their
children adapted into the American education culture, it was considered
necessary by the school staffs to have contact with the immigrant parents.
Although many districts had parent involvement programs, convincing the
29 Annie E. Casey Foundation. 1997 Kids Count: USA Profile, Baltimore, Maryland: Annie E. Casey
Foundation, 1997.
30 Pam McCollum, Obstacles to Immigrant Parent Participation in Schools, Intercultural Development
Research Association Newsletter (IDRA), November-December 1996.


200
McDaniels, Cynthia. Equality of Educational Opportunity: Race and Finance in Public
Education, The Constitution, Courts and Public Schools, Vol.l, 1992, Yale-New
Haven Teachers Institute, Conn.
McDonnell, Lorraine M., and Hill, Paul T. Newcomers in American Schools: Meeting the
Educational Needs of Immigrant Youth, Santa Monica, Calif.: RAND, MR-103-
AWM/PRIP, 1993.
McPartland, James M. Project Director. Center for Research on the Education of
Disadvantaged Students (CDS), Project # 7126: The Adaptation of Immigrant
Children in the American Educational System. John Hopkins University (1997).
McPartland, James M., Project Director. Center for Research on the Education of
Disadvantaged Students (CDS), Project # 7126: The Adaptation of Immigrant
Children in the American Educational System. John Hopkins University,(1997).
Migration News .International Migration Policy Program, Washington, DC, July 7, 1998.
Miller, Martha J., Student Enrollment Figures by Ethnicity and Race. Tallahassee, FI:
Strategy Planning Department, Florida Department of Education. (1997).
Moral Education in the Life of the School. Association for Supervision and Curriculum
Development, Educational Leadership, 46, 4-8 (May 1988).
Morales, J. Improvements Ahead in INS Treatment of Detained Children, Youth Law
News, 8(3), 1 (1987).
The 1970s Through 1990s: Immigration Issues, Review, and Revision, FAIR, March
1996.
Olivas, Michael A. Storytelling Out of School: Undocumented College Residency, Race,
and Reaction, Hastings Law Quarterly, Vol. 22 (Summer, 1995), 1019-1086.
p. 81 (1995).
Perkins, Joseph. The San Diego Union-Tribune, June 11, 1997, B-9, p. 2.
Phillips, David and Crowell, N., eds. Cultural Diversity and Early Education: A Report
of a workshop. Washington, DC: National Academy Press, 1994.
Rieff, David. Los Angeles: Capital Of The Third World, Harcourt Brace: New York, pp.
178-180(1991).
Rumbaut, Ruben G. Immigrant Students in California Public Schools: A Summary of
Current Knowledge. CDS Report No. 11, and Alejandro Protes (1991),


25
on the schools and public budgets, and the admission of foreign students to U.S.
universities as a route to immigration status.91
Research Question
In order to investigate this problem, the following questions were addressed.
Does the state of Florida have a legal, ethical, and moral obligation to educate the
children of undocumented immigrants? Does the state require a policy directed
specifically to the education of these children? What should Florida's policy be on
educating the children of undocumented immigrants?
Methodology
The traditional method of Policy Analysis/Legal Investigation was utilized to
identify judicial reasoning relative to established legal principles and applications in
relevant cases involving undocumented immigrant education. The procedure included
identifying relevant constitutional amendments, federal acts, state statutes, and rules and
regulations. Relevant cases were compiled, and judicial reasoning in each case was
analyzed.
To address the purposes of the study, there was a need to develop suggested
sample policy inclusions for implementation by all school districts within the state of
Florida. Several methods of legal research were employed. Specifically, policy study
and traditional legal research were appropriate. To accomplish this task, it was necessary
and prudent to research the status of current policies as well as research the appropriate
laws and rulings.
91
Immigrants and Education, in Fair , May 1997.


198
Florida Department Of Education, Enrollment of Foreign-bom and LEP Students,
Memorandum, June 23, 1995.
Florida Department of Education, Florida School Laws, Chapter 228-246 Florida
Statutes, 1999.
Florida Department of Education, Office of Organizational and Employee Development,
(2000).
Florida Department of Education, Profiles of School District Totals, (February 2000).
Florida Department of Education. (1996a). 1990 League of United Latin American
Citizens (LULAC) et al. v. State Board of Education Consent Decree.
Tallahassee, FL: Office of Multicultural Student Language Education.
Florida Department of Education. (1996b). 1994-95 annual status report on the
implementation of the 1990 League of United Latin American Citizens (LULAC)
et al v. State Board of Education Consent Decree. Tallahassee, FL: Office of
Multicultural Student Language Education.
Florida Governors Office, The Unfair Burden," Tallahassee, FL, March 1994.
Florida Management Education Services, Current year student data by district.
Tallahassee, FL: Florida Department of Education (1994).
Florida Wont Be Compensated For Illegal Immigration. 5/28/96, Florida: Illegal
Immigration, December 1998.
Florida: Social Policy Issues, Immigration and Florida: Social Policy Issues,"
Tallahassee, FL: Florida Department of Education (1997).
Fradd, Sandra H., and Lee, Okhee, eds., 1998. Creating Florida's Multilingual
Workforce, Miami, Custom Copy and Printing.
Gimpel, James G. and Edwards Jr., James R. (1999). The Congressional Politics of
Immigration Reform, Needham Heights, MA, Allyn & Bacon.
Glazer, Nathan, ed., Clamor At The Gates: The New American Immigration, pp. 6-7, ICS
Press, San Francisco (1985).
Greene, Joseph. FTE Administrator, Seminole County Public Schools, Sanford, Florida
(2000).
Guthrie, James W. School Finance Policies and Practices the 1980s: A Decade of
Conflict, Ballinger, Cambridge, MA (1988).


59
1994
Proposition 187. Law would deny illegal aliens all public services including education
The Supreme Court ruled it unconstitutional in 1997.
1996
Immigration Act. Congress voted to double the U S. Border Patrol to 10,000 agents
over five years and mandated the construction of fences at heavily trafficked areas of the
U S.-Mexico border A program to check the immigration status of job applicants.
1996
Immigrants lose benefits President Clinton signed welfare reform bill. Legal
immigrants lost their right to food stamps and Supplemental Security Income. Illegal
immigrants became ineligible for virtually all federal and state benefits except emergency
medical care, immunization programs, and disaster relief.
Source: Summary of U S. Immigration Law, Close-Up Foundation Special Topic Page, July 1998
Summary
In the 1920s, legislators responded to social tensions by enacting restrictive
immigration laws. In the relatively tranquil society, which resulted from reduced
immigration in the ensuing years, Americans began to have more confidence in their
institutions and values through the decades of the 40s and 50s. By 1965, the very success
of the immigration lull led many Americans to believe that American institutions could
accommodate any level of diversity. The United States Congress confidently, chose to
change immigration policy in 1965.117
After liberalization of American immigration laws in the 1960s, mass immigration
to the United States began again and continued without significant debate on the issues of
social cohesion, which so dominated earlier immigration discussions. Public schools were
one of the first institutions to confront the consequences of American immigration laws
and the lack of enforcement of those laws. With corresponding confidence in American
institutions and values, the United States Supreme Court in 1982 forced public schools to
confront the challenge of illegal immigration.118
11 Immigration Act of 1965. Pub. L. No. 89-235. 79 Stat. 911.
118
Plyler, 457 U S. 202.


80
the United States primarily to worknot for schools or medical care or other public
benefits.72
Conflict with Federal Laws
The 5-4 opinion in Plyler brought out two conflicting themes, variations of which
appeared in the Proposition 187 litigation. First, the undocumented status of aliens might
itself have been sufficient basis for denying governmental benefits that it provided to
others. However, control of immigration was within the exclusive purview of the federal
government. While the States did have some authority to act with respect to illegal
aliens, at least where such action mirrored federal objectives and furthered a legitimate
state goal, the disability imposed on the students did not correspond with any
identifiable congressional policy, and, more important, the classification of
undocumented students did not operate harmoniously within the federal program.73
The compelling consideration for the Plyler Court was how the statute hurt
innocent children and society. These considerations were conclusive: Illiteracy was an
enduring disability. The inability to read and write would handicap the individual
deprived of a basic education each and every day of his life. In determining the
rationality of [the statute], one must appropriately take into account its costs to the Nation
and to the innocent children who are its victims.74
72 Mailman, 187 and Its Lessons, p.3, col.l.
73 457 U.S. at 225-26, citing De Canas v. Bica, 424 U.S. 351 (1976), as cited in Mailman, 187 and Its
Lessons, p.3, col.l.
74 457 U.S. at 222,223-24. Constrained by its earlier holding in San Antonio School District v Rodriguez,
411 U.S. 1 (1973), that education is not a fundamental right, and given its opinion that undocumented
status is not a constitutional irrelevancy, the Court applied an intermediate rather than strict scrutiny test.


87
educated all the children who came through their doors. The Gallegly provision would
have turned teachers and school administrators into substitute INS officers.100
Adding a new dimension to the issue was the North American Free Trade
Agreement (NAFTA)101 that had been negotiated by the United States, Mexico, and
Canada. The agreement created a regional trading bloc of 370 million people by
lowering trade barriers among the three countries. The agreement was designed to reduce
the flow of illegal aliens by creating better-paying jobs in Mexico. Even though the trade
agreement was approved, some experts on illegal immigration argued that the United
States needed to focus greater attention on developing the economies of Mexico and its
neighbors to keep potential illegal aliens at home. They maintained that increased
foreign aid to the countries of Latin America and incentives for low-wage American
industries to invest in the region were necessary to generate more local jobs. A hope of
this measure was the elimination of the need for further legislation on the illegal
immigrant issue.
American society had changed, and part of the difference sustained those
Americans still confident about our assimilative capacitysome of which mistakenly
assumed that mass immigration was a constant historical fixture of American society
As the influx of immigrants continued and the number of immigrant children
enrolled in the public education system grew, school systems expanded along with them.
Statistics showed that, in spite of the many obstacles immigrant children overcame as
new students in a new country, they persevered and some did as well if not better than
100 Charles Levendosky, The Politics of Turning Children into Victims. Casper (W\o.) Star Tribune.
May 1996
101 North American Free Trade Agreement, August 1992.


182
exclusion of appellees' class of children from state-provided education is a type of
punitive discrimination based on status that is impermissible under the Equal Protection
Clause.128
In reaching this conclusion, I am not unmindful of what must be the exasperation
of responsible citizens and government authorities in Texas and other States similarly
situated. Their responsibility, if any, for the influx of aliens is slight compared to that
imposed by the Constitution on the Federal Government. So long as the ease of entry
remains inviting,129 and the power to deport is exercised infrequently by the Federal
Government, the additional expense of admitting these children to public schools might
fairly be shared by the Federal and State Governments.130 But it hardly can be argued
128 [The classes certified in these cases included all undocumented school-age children of Mexican origin
residing in the school district, p. 206, or the State. See In re Alien Children Education Litigation, 501
F.Supp. 544, 553 (SD Tex. 1980). Even so, it is clear that neither class was thought to include mature
Mexican minors who were solely responsible for violating the immigration laws. In 458 F.Supp. 569 (ED
Tex.1978), the court characterized plaintiffs as entire families who have migrated illegally. Ibid., p. 578.
A parent or guardian represented each of the plaintiff children in that case. Similarly, the court in In re
Alien Children Education Litigation found that undocumented children do not enter the United States
unaccompanied by their parents. 501 F.Supp. p. 573. A different case would be presented in the unlikely
event that a minor, old enough to be responsible for illegal entry and yet still of school age, entered this
country illegally on his own volition.]
129 [457 U.S.241]
130 [In addition, the States ability to respond on their own to the problems caused by this migration may be
limited by the principles of preemption that apply in this area. See, e.g., Hines v. Davidowitz, 312 U.S. 52
(1941). In De Canas v. Bica, 424 U.S. 351 (1976), the Court found that a state law making it a criminal
offense to employ illegal aliens was not preempted by federal authority over aliens and immigration. The
Court found evidence that Congress intended state regulation in this area. Ibid., p. 361 (there is evidence .
.. that Congress intends that States may, to the extent consistent with federal law, regulate the employment
of illegal aliens). Moreover, under federal immigration law, only immigrant aliens and nonimmigrant
aliens with special permission are entitled to work. See 1 C. Gordon & H. Rosenfield, Immigration Law
and Procedure, 1.34a, 1.36, 2.6b (1981).
Because federal law clearly indicates that only certain specified aliens may lawfully work in the country,
and because these aliens have documentation establishing this right, the State in De Canas was able to
identify with certainty which aliens had a federal permission to work in this country. The State did not
need to concern itself with an alien's current or future deportability. By contrast, there is no comparable
federal guidance in the area of education. No federal law invites state regulation; no federal regulations
identify those aliens who have a right to attend public schools. In addition, the Texas educational
exclusion requires the State to make predictions as to whether individual aliens eventually will be found to
be deportable. But it is impossible for a State to determine which aliens the Federal Government will
eventually deport, which the Federal Government will permit to stay, and which the Federal Government


96
with Medicaid (10.2 percent) and criminal justice/corrections (5.4 percent) accounted for
over 75 percent of total direct outlays for immigrants in Florida at that time.134
Researchers for The Urban Institute estimated the 1996 Floridas non-citizen
population at 1,431,000135 (10 percent of states population), which ranked fourth behind
California, New York and Texas in numbers. Of that number, 350,000 were estimated to
be illegal immigrants.136 It is important to note that estimating the size of a hidden
population was inherently difficult. While estimates were based on the most reliable
information available, no allowances for students or other long-term non-immigrants
were made.
Because Florida was one of the major entry ways for newly arrived non-English
language background students and families, its public schools faced challenges not
experienced by many other states. These challenges were seen as the vanguard for the
future of public schools across the nation. As Florida effectively addressed its
challenges, it was not only increasing the educational level of its work force, but also
providing important benchmarks for other states with growing numbers of LEPs. For
most of the decade of the 1990s, Florida school districts were highly impacted by the
presence of LEPs and the policies to provide them with an appropriate education.
Although, districts responded to the requirements of the Consent Decree, LEPs were
often viewed as presenting unique challenges, rather than bringing assets to be valued.
133 Ibid.
134 Ibid.
135 Karen C. Tumlin, Wendy Zimmermann, and Jason Ost, State Snapshots of Public Benefits for
Immigrants: A Supplemental Report to Patchwork Policies. The Urban Institute, Washington, DC,
(1999).
136 Illegal Alien Resident Population, Census Bureau, 1996.


55
Pierce v. Society of Sisters,"0 and Brown v. Board of Education"1 prevailed over the
1 19
public interest doctrine revitalized in Ambach v. Norwich.
110 In Pierce v. Society of Sisters, 268 U.S. 510 (1925), the United States Supreme Court extended the
Meyer reasoning to protect the right of private institutions to educate children. The Court invalidated an
Oregon statute prohibiting private education of normal children within a reasonable distance from a
public school (see Laws Or. 1923, p.9). The Court noted that it was within the states power to reasonably
regulate schools, to require that teachers be of good moral character and patriotic disposition, or to
require the teaching of certain subjects plainly essential to good citizenship. However, the Court held that
the states had no general power to standardize its children by forcing them to accept instruction from
public teachers only. (Pierce, pp. 534-535).
111 It was not until 1954, in Brown v. Board of Education, 347 U.S. 483, however, that the United States
Supreme Court had the confidence to tackle one of the most enduring and debilitating problems in
American life: the doctrine of separate but equal education.. At last, stated the Court, America must use its
mature and successful institutions to include all Americans:
We must consider public education in the light of its full development and its
present place in American life throughout the Nation. Only in this way can it
be determined if segregation in public schools deprives these plaintiffs of the
equal protection of the laws. Today, education is perhaps the most important
function of the state and local governments. Compulsory school attendance laws
and the great expenditures for education both demonstrate our recognition of
the importance of education to our democratic society. It is required in the
performance of our most basic public responsibilities, even service in the
armed forces. It is the very foundation of good citizenship. Today it is a
principal instrument in awakening the child to cultural values, in preparing
him for later professional training, and in helping him to adjust normally to his
environment. In these days, it is doubtful that any child may reasonably be
expected to succeed in life if he is denied the opportunity of an education.
Such an opportunity, where the state has undertaken to provide it, is a right
Which must be made available to all on equal terms. Ibid. pp. 492-93.
112 In Ambach v. Norwick, 441 U.S. 68 (1979), the United States Supreme court upheld a New York statute
denying public school teaching positions to aliens who were eligible for citizenship but refused to
naturalize. The Court noted that state power to enact classifications based on alienage had narrowed to the
point of being inherently suspect and subject to close judicial scrutiny (Ibid. pp. 72-73 [internal citations
omitted]). Nevertheless, the Court acknowledged that states have some functions so entwined with state
governmental operations so as to allow exclusion of aliens under the still extant public interest doctrine
(Ibid., pp. 73-74).
Citing Brown, Society of Sisters, and Meyer, the Court stressed the importance of education to our
democratic society and to our culture (Ibid., pp. 76-77 [other internal citation omitted]). Moreover, the
Court cited numerous authorities regarding the inculcating and democratizing role of the public schools as
an assimilative force by which diverse and conflicting elements of our society are brought together on a
broad but common ground. (Ibid., pp. 77-78). Additionally, the court recognized the special role that
teachers play in the education of children as well as the wide latitude teachers have in the manner
information is communicated to students as a rationale for a state to put reasonable requirements on teachers
(Ibid., pp. 78-79). Once again, the court had acknowledged the nexus between cultural dynamism and core
values.


37
with the family (and often adopted throughout society), while rigid prejudices tended to
be discarded as troublesome. Customs that offended relatives on the other side, or
the public, also tended to be dropped. Family solutions to cross-cultural interactions
within the family set out how far one deviated from the established norms. Family
members carried these new sensibilities with them in their other social interactions and
thus began a ripple effect of tolerance. The family dynamic also included influences from
the experiences of all family members in the larger society. Thus, assimilation was not a
wholesale swap of one cultural form for another.33 Those who claimed that America had
always been a diverse nation, de-emphasized the strong tendency of individuals and
families to seek common ground.
Education developed another important nexus between cultural dynamism and
value solidification, which benefited from reduced immigration levels. Experts
acknowledged the role of education in encouraging individuals to move away from
passively accepting predetermined social roles even before the American Revolution.34
Education also solidified core values even during times of demographic change. During
the 1920s, concerned Americans began what was known as the Americanization
movement in education.35 Proponents of the Americanization movement often
overlooked minority accomplishments and glossed over majority abuses in their push to
32 Plyler, 457 U.S. at 202 (1982).
33 Bernard Bailyn, Education in the Forming of American Society 49 (1960); quoted in Van De Mark.
34 Ibid.
35 Arthur M. Schlessinger, Jr., The Disuniting of America, p. 35 (1993).


109
Floridas education costs for both legal and illegal immigrants in 1993 were
$517.6 million, which was up from 1992s expenditure of $418.5 million. The State
spent $254 million alone on the English for Speakers of Other Languages (ESOL)
program."13 The number of students being served in ESOL programs during the 1998-
1999 school year was 103,008, and for the 1999-2000 school year the number was
121,783; out of total student (Pre-K through 12) membership of 2,339,358 and 2,376,128
respectively.34 These numbers reflected only those students being served in the ESOL
program, and was not inclusive of all immigrant (legal and illegal) students. These
numbers also indicated an 8.5 percent increase in ESOL enrollment in one year with a
correlating 9.8 percent increase in the student membership. When compared to the 1995
total student membership of 2,175,233, the fall 1999 membership showed an overall
increase of 200,895 students or 9.3 percent.35
Education for illegal aliens totaled $180.4 million in 1993. This number
represented another 24 percent increase in costs from the previous year when illegal alien
education was $145.9 million. The increase was due to the rise in illegal aliens arriving
in the state of Florida.36
33 Florida: Social Policy Issues, (1998) .
34 Florida Department of Education, Profiles of School District Totals, (February 2000).
35 Florida Department of Education, 98-99 Full-Time Public School Equivalency Report of Student
Enrollment.
36 The Unfair Burden, Immigration's Impact on Florida, Florida Governors Office, Tallahassee, FL.,
March 1994. (Later statewide expenditure figures were not available as April 2000.)


78
States and be reported to the authorities, including the Immigration and Naturalization
Service (INS).64
Proposition 187 also limited attendance at public schools to U.S. citizens and to
aliens lawfully admitted to the United States for permanent residence or otherwise
authorized to be here.65 Whenever school districts reasonably suspected a violation, they
had only 45 days to so notify INS and other authorities and to advise parents that
schooling would be cut off in 90 days.66
The constitutional challenge to Proposition 187 rested mainly on the Plyler67
precedent. Writing for the Plyler majority, Justice William Brennan argued that the
Texas law would inevitably harm children. These children would eventually obtain legal
status in this country, yet would be permanently locked into the lowest socioeconomic
class. Brennan acknowledged that the state had some leeway in such matters. Under
equal-protection principles, illegal alien status was not a suspect class like race or
religion, and education was not a fundamental right. Hence, it did not require
heightened judicial scrutiny. Nevertheless, Brennan said, a law that denied children the
ability to live within the structure of our civic institutions ... can hardly be considered
rational unless it furthers some substantial goal of the State.68
Brennan conceded that keeping illegal aliens out of the state might be a legitimate
state goal. But the trial court found that the Texas law had neither the purpose nor the
64 Mailman, 187 and Its Lessons, p.3, col.l.
65 Proposition 187, Sec.7.
66 Mailman, 187 and Its Lessons, p.3, col.l.
67 Plyler, 457 U.S. 202 (1982).
68 Schuck, Illegal Immigration, pp. 85-92.


81
How did Plyler control the constitutionality of Proposition 187? From Judge
Pfaelzer's verbal decision, Plyler directly affected only those who sought to enter or
remain in elementary or secondary schools; those in the university system would not be
protected.75 However, elements of Plyler were brought into a more general constitutional
attack on Proposition 187, relating to the supremacy of federal legislation over the subject
of immigration. Congress unquestionably had authority to legislate on immigration and
had exercised that power comprehensively in regulating authorized entry, length of stay,
residence status, and deportation, and in the treatment of aliens otherwise.76 In defining
who received benefits, Congress had positioned immigration classifications into the
framework of various public assistance programs.77
Additionally, under Proposition 187, frontline, untrained state employees decided
who had apparent illegal status or was here in violation of law and therefore
ineligible for benefits.78 Those who conveyed the bad news were deputized to direct the
applicant to leave the country, effectively to issue what could have easily been taken as a
deportation order. Yet, the Immigration and Nationality Act provided that such an order
could be issued only by an immigration judge after a hearing on a record, with the
government bearing the burden of proof, and the alien having a right to counsel.79
Furthermore, PRUCOL (permanent resident) aliens by definition had INS permission to
75 457 U.S. at 219.
76 Gonzales v. City of Peoria, 722 F2d 468,474-75 (9th Cir. 1983).
77 Janet M. Calvo, Alien Status Restrictions on Eligibility for Federally Funded Assistance Programs, 16
New York University Review of Law & Social Change, 395 (1987-88).
78 Proposition 187, Sec. 5-7.
79 INA Sec. Sec. 242(b), 292, 8 USC Sec.Sec. 1252(b), 1362.


133
even though the district could not obtain all of the necessary credentialed teachers, it
demonstrated an effort to hire as many teachers as possible. The Court also approved
testing procedures, which included a validated test and classroom teacher assessment as
to the English skills of the students. The Court had difficulty determining how to
measure the efficacy of a districts bilingual program and accepted as good evidence the
fact that bilingual students were progressing at about the same rate as other bilingual
students in the state of California.
Therefore, federal statutes and case law required that school districts take
appropriate action to overcome language barriers that could impede student achievement.
The specific action was left to the discretion of the school district so long as it was based
on: 1) a sound educational theory; 2) sufficient resources were implemented to enact the
theory; and 3) if after a period of time, students were not making progress, a different
approach was provided to the students. The federal law did not require bilingual nor
primary language education. However, the federal law did require that staff members
were trained and experienced in English language acquisition skills and that assessment
programs were meaningful and validated.
Florida Legislation
On August 14,1990 a Consent Decree was signed in United States District Court
on behalf of the Florida State Board of Education and of the plaintiffs who had alleged
that the State Board of Education had not complied with its obligations under federal and
state law to ensure that the Florida school districts provided equal and comprehensible
instruction to limited English proficient (LEP) students.


15
The federal Equal Educational Opportunities Act (EEOA) of 197453 required
each public school system to develop appropriate programs to overcome language
barriers that impeded equal participation by its students in its instructional program.
While the EEOA stipulated that school districts must provide appropriate assistance for
students with English deficiencies, it did not require that such assistance be in the form of
bilingual or bicultural education. School districts could satisfy legal requirements by
providing remedial English instruction rather than bilingual programs. Each state was
responsible for providing a school system whereby all children received an education
with no charge for attending school. The federal Equal Education Opportunities Act of
1974 also provided that no state could deny equal education opportunities to an
individual because of his or her race, color, sex or national origin. Every person had the
right to attend school, unless his or her conduct violated valid rules and regulations.54
Children of Immigrants
1990 2000 2010
Source: Fix and Passel (1994).
Figure 1-1 School-Age Immigrant Population, 1990-2010
53 Equal Education Opportunities Act of 1974 (EEOA) at 20 U.S.C. 1703.
IU
9
8
7
6
5
4
3
2
1
n
9.1
7 A
5.7

Projected Change,
1990-2010
3.4
4
Children of
Natives
Children of
Immigrants
1990-2010


6
The Quota Act of May 19, 192111 created a National Origins plan under which
each country had an immigration quota in proportion to that nations past contribution to
the population of the United States. The Act based the quotas on the 1910 Census of
Population and allowed 357,000 immigrants into the United States each year.12
The 1924 Immigration Act used the 1890 census of different ethnic groups in the
United States as a basis for establishing a national origins quota for emigrant-sending
nations.13 A basic idea reflected in the 1924 Act was the fear that heavy immigration
from southern and eastern Europe discriminated against current residents of the United
States (largely descended from northern and western Europeans) by diluting the ability of
current residents to determine the nation's destiny. The 1924 Act maintained the 1921
exemption for the independent countries of the Western Hemisphere from any quotas.14
The 1890 census served as an interim provision until Congress established the final
national origins system in 1929.15 Thereafter, Congress set the national origins quota at
one-sixth of one percent of the 1920 population to arrive at a base immigration figure of
153,714.16 The 1920s legislation effectively stopped large-scale immigration to the
United States for forty years.
Confidence in American institutions, the realities of World War II alliances, and
post-war foreign affairs combined to challenge the basis of America's immigration
11 Quota Act, ch.8,42 Stat. 5 (1921) (formerly codified at 8 U.S.C. §§ 229-31).
12 Ibid.
13 The Immigration Act of 1924, ch. 190,43 Stat. 153 (1924) (formerly codified at 8 U.S.C. §§ 201-204).
14 Bennett, American Immigration Policies, p 47.
15 Act of July 1, 1929, ch. 306,45 Stat. 400 (formerly codified at 8 U.S.C. § 204c).
16
Ibid.


50
differences of race, color, or of nationality; and the protection of the laws was a pledge of
the protection of equal laws.85
The Courts majority opinion in Plyler v. Doe, given by Justice Brennan,
contained rather dramatic and elegant language highlighting the public-interest aspects
involved. Penalizing children for the illegal entry of their parents would have marked
them with the stigma of illiteracy for the rest of their lives.86 If education in the United
States was not a fundamental right, the opinion continued, neither was it merely some
governmental benefit indistinguishable from other forms of social welfare. Also
underlined by the Court majority was that education was the most vital civic institution
for the preservation of a democratic system of government and that we cannot ignore
the significant social costs borne by our Nation when select groups are denied the means
to absorb the values and skills upon which our social order rests.87 They added, It is ..
. clear that whatever savings might be achieved by denying these children an education,
they are wholly insubstantial in light of the costs involved to these children, the State, and
the Nation.88
The majority further acknowledged that illegal aliens might have a negative net
impact upon the economy, but did not buy the argument that barring their children from
public education would have the effect of discouraging illegal entries, at least when
compared with the alternative of prohibiting employment of illegal aliens. The majority
further indicated that they would not be impressed even if the state could have proven that
85 Yick Wo V. Hopkins, 118 U.S. 369, (1886).
86 Plyler, 457 U. S. 224.
87 Ibid., p. 221.


117
with 45 percent enrolled in California.59 National estimates of growth in the immigrant
student population provided a glimpse of the future face of America: the total school-age
population was projected to grow by more than 20 percent, from 34 million in 1990 to 42
million in 2010. It was estimated that children of immigrants would account for more
than half of the growth. Further estimations suggested that the number of children of
immigrants would rise to 9 million in 2010, representing 22 percent of the school-age
population.60
Family reunification was a central reason for immigration, and many new
immigrants arrived in family groups. Family relationships helped define immigrant
childrens experiences in the United States, including their eligibility for some social and
economic resources.61
The prevailing impression was that immigrant students, regardless of their
country of origin, did not adjust well to school and performed poorly academically, and
drained resources from an already overburdened educational system. However, the notion
of a monolithic view of the immigrant student was far from accurate; immigrant
childrens educational needs and outcomes differed considerably depending on their
socioeconomic status, levels of English proficiency, cultural background, and experiences
in their country of origin. Many of these sources of diversity affected educational
59 U.S. Department of Education. The Condition Of Bilingual Education In The Nation: A Report To The
Congress And The President. Washington, DC: U.S. Department of Education, 1991.
60 Michael Fix and Jeffrey S. Passel, Immigration and Immigrants: Setting the Record Straight.
Washington, DC: Urban Institute, May 1994.
61 Immigrant Children and Their Families: Issues for Research and Policy, The Future of Children, Vol. 5,
No. 2, Summer/Fall 1995.


164
population.55 But more is involved in these cases than the abstract question whether
21.031 discriminates against a suspect class, or whether education is a fundamental right.
Section 21.031 imposes a lifetime hardship on a discrete class of children not accountable
for their disabling status. The stigma of illiteracy will mark them for the rest of their
lives. By denying these children a basic education, we deny them the ability to live
within the structure of our civic institutions, and foreclose any realistic possibility that
they will contribute in even the smallest way to the progress of our Nation. In
determining [457 U.S. 224] the rationality of 21. 031, we may appropriately take into
account its costs to the Nation and to the innocent children who are its victims. In light
of these countervailing costs, the discrimination contained in 21.031 can hardly be
considered rational unless it furthers some substantial goal of the State. IV
It is the State's principal argument, and apparently the view of the dissenting
Justices, that the undocumented status of these children vel non establishes a sufficient
rational basis for denying them benefits that a State might choose to afford other
residents. The State notes that, while other aliens are admitted on an equality of legal
privileges with all citizens under nondiscriminatory laws,56 the asserted right of these
children to an education can claim no implicit congressional imprimatur.57 Indeed, in the
State's view, Congress' apparent disapproval of the presence of these children within the
55 San Antonio Independent School District v. Rodriguez, pp. 28-39.
56 Takahashi v. Fish & Game Commission, 334 U.S. 410,420 (1948).
57 [If the constitutional guarantee of equal protection was available only to those upon whom Congress
affirmatively granted its benefit, the states argument would be virtually unanswerable. But the Equal
Protection Clause operates of its own force to protect anyone within [the State's] jurisdiction from the
State's arbitrary action. See Part II. The question we examine in text is whether the federal disapproval of
the presence of these children assists the State in overcoming the presumption that denial of education to
innocent children is not a rational response to legitimate state concerns. Ed.]


202
U.S. Department of Education. The Condition Of Bilingual Education In The Nation: A
Report To The Congress And The President. Washington, DC, 1991.
U.S. House of Representatives Ways And Means Committee Print: 104-14 [1996 Green
Book] "Appendix J. Noncitizens"
U.S. House of Representatives, Ways And Means Committee Print: 104-14 [1996 Green
Book]
The Unfair Burden, Immigrations Impact on Florida, Florida Governors Office,
Tallahassee, FI., March 1994.
Vail, Kathleen. No Entry, The American School Board Journal, 183, no. 9, pp. 19-25.
(September/96 1996):
Van De Mark, Gregg. Too Much of a Good Thing," Washburn Law Journal 35, no. 3
(Spring 1996) .
Vemez, George, Krop, Richard, and Rydel, Peter, Closing the Education Gap: Benefits
and Costs, RAND, p. 13, (1999).
Vialet, Joyce C. and Eig, Larry M. Immigration and Federal Assistance: Issues and
Legislation, Congressional Research Service Issue Brief, April 18, 1996.
Villarreal, Abelardo and Adela Solis, Effective Implementation of Bilingual Programs:
Reflections from the Field, EDRA Newsletter, January, 1998.
Ziegler, Benjamin M. ed., Immigration, An American Dilemma 13 (1953).


53
QQ
no meaningful way to distinguish between education and other governmental benefits.
Was education more fundamental than food, shelter, or medical care?
The Federal Government excluded illegal aliens from numerous social welfare
programs, such as the food stamp program,100 old-age assistance, aid to families with
dependent children, aid to the blind, aid to the permanently and totally disabled, and
supplemental security income programs,101 the Medicare hospital insurance benefits
program, and the Medicaid hospital insurance benefits for the aged and disabled
program. Although these exclusions did not conclusively demonstrate the
constitutionality of the State's use of the same classification for comparable purposes, at
the very least they tended to support the rationality of excluding illegal alien residents of a
state from such programs so as to preserve the state's finite revenues for the benefit of
lawful residents.104
The Court maintained, Barring undocumented children from local schools would
not necessarily improve the quality of education provided in those schools.105 However,
the legitimacy of barring illegal aliens from programs such as Medicare or Medicaid did
not depend on a showing that the barrier would improve the quality of medical care
given to persons lawfully entitled to participate in such programs. Education, like
99 Plyler, 457 U.S. 248.
100 7 U.S.C. 2015(f) (1976 ed. and Supp. IV) and 7 CFR 273.4 (1981).
101 45 CFR 233.50(1981).
102 42 U.S.C. 1395-2 and 42 CFR 405.205(b) (1981).
103 42 U.S.C. 1395o and 42 CFR 405.103(a)(4) (1981).
104 Mathews v. Diaz, 426 U.S. 80.
105 Plyler, 457 U.S. 252: See 458 F.Supp. 569,577 (ED Tex. 1978).


LEGAL REFERENCES
20 U.S. C. § 1703(0-
414 U.S. 563(1974).
42 U.S.C. 1395-2 and 42 CFR 405.205(b) (1981).
42 U.S.C. § 2000.
42 UCLA L. Rev.
45 CFR 233.50(1981).
458 F. Supp. 567.
57 Cal. App.4,h 693.
628 F. 2d 448.
7 U.S.C. 2015(0 (1976 ed. and Supp. IV) and 7 CFR 273.4 (1981).
Abington School District v. Schempp, 374 U.S. 203, 230 (1963).
Act of July 1, 1929, ch. 306, 45 Stat.400.
Ambach v. Norwick, 441 U.S. 68, 76 (1979).
Brown v. Board of Education, 347 US 483, 493 (1954).
California Constitution, Article I, Sec.7(a).
Castaneda v. Pickard, (1986) 781 F 2d 456 (Castaneda II).
Castaneda v. Pickard, (1981) 648 F.2d 989.
Chiles v. U.S., 95-1249.
203


204
Chinese Exclusion Act, ch. 126,22 Stat.58. 1882.
Civil Rights Act of 1964, Pub. L. No. 88-352, 78 Stat. 241.
CONGRESSIONAL RECORD, pt 4, p. 5330 (1952).
Consent Decree [s. 228.121 (l)-(4), FS], Non-resident Tuition Fee.
Consent Decree, [s. 232.01 (l)(f), FS], Compulsory School Attendance.
DeCanas v. Bica, 424 U.S. 351(1976).
Emergency Education Act of 1984.
Emergency Immigrant Education Act (EIEA), (Title IV, Part D of the Elementary and
Secondary Education Act), as amended, (20 U.S.C. 3121-3130).
Equal Education Opportunities Act of 1974 (EEOA) at 20 U.S.C. 1703.
Exec. Order No. 11,246, 3 C.F.R. 339 (1964-65).
Florida School Laws, Chapters 228-246, 1999.
Fogg v. Board of Education, 76 N.H. 296, 82 A. 173, 174-75 (1912).
H. R. (2022), Gallegly Amendment, 1996.
Goldberg v. Kelly, 397 U.S. 254 (1970).
Gonzales v. City of Peoria, 722 F2d 468, 474-75 (9th Cir. 1983).
Immigration Reform and Control Act, Pub. L. No. 99-603, 100 Stat. 3359 (1986).
Immigration Act of 1924, ch. 190, 43 Stat. 153 (1924).
Immigration Act of1965, Pub. L. No. 89-235, 79 Stat. 91, (1994).
Immigration Act of 1990, Pub. L. No. 101-649 §§ 111-124, 104 Stat. 4978-97 (1990).
Immigration Act of 1990, Pub. L. No. 101-649 §§ 111-24, 104 Stat. 4978-97 (1990).
Immigration and Nationality Act Amendments of October 3, 1965, (79 Stat. 911).
Immigration and Nationality Act, (INA), Public Law 82-414, [s 101(a)(3)], 8 U.S.C. [s
1101(a)(3)] (1994).


199
Hickman, Larry A., and Alexander, Thomas M., The Essential Dewey, Indiana University
Press, Bloomington, Ind. (1998).
Higham, John. Strangers in the Land: Patterns of American Nativism 1860-1925 p. 321
(1955).
Hing, Bill Ong, Making and Remaking Asia America through Immigration Policy 1850-
7990,(1993).
Huddle, Donald. The Net National Costs of Immigration in 1993" June 1994.
Illegal Immigrant Children: In or Out of Public Schools?. Education Week, April 1996,
Immigrant Children and Their Families: Issues for Research and Policy, The Future of
Children, Vol. 5, No. 2, Summer/Fall 1995.
Immigrants and Education, FAIR, May 1997.
Immigration Policy versus Immigrant Policy, FAIR, October 1997.
.
Initiative on Aliens Suffers Its Biggest Setback Yet, New York Times, Dec. 15, 1994,
A18.
Jones, Maldwyn A. American Immigration, 249-55 (2nd ed. 1992).
Karst, Kenneth L. Paths to Belonging: The Constitution and Cultural Identity, 64 N.C.L.
REV. 303.
The Lincoln Library of Essential Information. 35lh ed., s.v. Immigration. Frontier Press:
Columbus, Ohio, (1972).
Levendosky, Charles. "The Politics of Turning Children into Victims," Casper (Wyo.)
Star Tribune, May 1996.
Mailman, Stanley. Californias Proposition 187 and Its Lessons, New York Law Journal,
p.3, col.l, (January 3, 1995).
McCarthy, Martha. The Right to an Education: Illegal Aliens. Journal of Educational
Equity and Leadership 2 (Summer 1982): 283-85.
McCollum, Pam. Obstacles to Immigrant Parent Participation in Schools, Intercultural
Development Research Association Newsletter (IDRA), November-December
1996.
McConnell, Scott. The New Battle over Immigration, Fortune, p. 98, May 9, 1988.


68
regular flow of refugees and emergency admissions. The Refugee Act of 1980 defined
refugee in U.S. law; it then became section 101(a)(42)(A) of the Immigration and
Nationality Act.32 The 1980 act provided funding for all areas of refugee settlement, and
allowed access to such programs as AFDC, ESOL, and vocational and employment
related training.33
On November 6, 1986, the Immigration Reform and Control Act34 tackled the
growing issue of illegal immigration. In hopes of stemming the entry of illegal aliens, the
1986 act imposed penalties on employers who knowingly hired undocumented workers.
It also allowed illegal aliens who had lived in the United States since 1981, as well as
undocumented agricultural workers, to become citizens. Under this amnesty program,
more than 2.8 million illegal aliens out of approximately 3 million applicants gained legal
status by the time all cases were resolved.
The Immigration Act of November 29, 199035 raised the limit on annual
admissions to 675,000 immigrants. (The 1965 act had set the ceiling at 290,000.) The
1990 law also nearly tripled the number of immigration slots reserved for newcomers
with prized job skills and their families. When the revision took effect in 1995, over 71
percent of immigration visas went to family members of U.S. citizens and legal residents;
about 21 percent were set aside for well-trained workers and their families; and about 8
32 Immigration and Nationality Act, Public Law 82-414. The Immigration and Nationality Act has been
amended many times. When Congress enacted a law, it generally did not re-write the entire body of law, or
even entire sections of a law, but instead added to or changed specific words within a section. These
changes were then reflected within the larger body of law.
33 The Unfair Burden, Florida Governors Office, March 1994.
34 Immigration Reform and Control Act of 1986, Public Law 99-603.


CHAPTER 5
IMMIGRANT EDUCATION POLICY INCLUSIONS
FOR THE STATE OF FLORIDA
Introduction
This chapter provides the basis for, and the essential ingredients to, an effective
policy for the education of undocumented alien children. The differences in types of
policy, federal rules and established state guidelines are reviewed. It also considers some
of the cases previously discussed and looks more carefully at Florida legislation. Finally,
needed enhancements to Florida immigrant education policy are offered.
The Right to Learn
Of all the civil rights for which the world has struggled and fought for
5,000 years, the right to learn is undoubtedly the most fundamental...
The freedom to learn ... has been bought by bitter sacrifice. And
whatever we may think of the curtailment of other civil rights, we
should fight to the last ditch to keep open the right to learn, the right to
have examined in our schools not only what we believe, but what we
do not believe; not only what our leaders say, but what the leaders of
other groups and nations, and the leaders of other centuries have said.
We must insist upon this to give our children the fairness of a start
which will equip them with such an array of facts and such an attitude
toward truth that they can have a real chance to judge what the world
is and what its greater minds have thought it might be1
1 W.E.B. Du Bois, The Freedom to Learn Midwest Journal 2, Winter 1949, pp. 230-31.
127


158
But we would not be faithful to our obligations under the Fourteenth Amendment
if we applied so deferential a standard to every classification. The Equal Protection
Clause was intended as a restriction on state legislative action inconsistent with elemental
constitutional premises. Thus, we have treated as presumptively invidious those
classifications that disadvantage a suspect class,37 or that impinge upon the exercise of
a fundamental right.38 With respect to such classifications, it is appropriate to enforce
the mandate of equal protection by requiring the State to demonstrate that its
classification has been precisely tailored to serve a compelling governmental interest. In
addition, we have recognized that certain forms of legislative classification, while not
facially invidious, nonetheless give rise to recurring constitutional difficulties; in these
limited circumstances, we have sought the assurance that the classification reflects a
reasoned judgment consistent with the ideal of equal protection by inquiring whether it
37 [Several formulations might explain our treatment of certain classifications as suspect. Some
classifications are more likely than others to reflect deep-seated prejudice, rather than legislative rationality
in pursuit of some legitimate objective. Legislation predicated on such prejudice is easily recognized as
incompatible with the constitutional understanding that each person is to be judged individually and is
entitled to equal justice under the law. Classifications treated as suspect tend to be irrelevant to any proper
legislative goal. See McLaughlin v. Florida, 379 U.S. 184, 192 (1964); Hirabayashi v. United States, 320
U.S. 81, 100 (1943). Finally, certain groups, indeed largely the same groups, have historically been
relegated to such a position of political powerlessness as to command extraordinary protection from the
majoritarian political process. San Antonio Independent School District v. Rodriguez, 411 U.S. 1,28
(1973); Graham v. Richardson, 403 U.S. 365, 372 (1971); see United States v. Carotene Products Co., 304
U.S. 144, n. 4 (1938). The experience of our Nation has shown that prejudice may manifest itself in the
treatment of some groups. Our response to that experience is reflected in the Equal Protection Clause of
the Fourteenth Amendment. Legislation imposing special disabilities upon groups disfavored by virtue of
circumstances beyond their control suggests the kind of class or caste treatment that the Fourteenth
Amendment was designed to abolish. Ed.]
38 [In determining whether a class-based denial of a particular right is deserving of strict scrutiny under the
Equal Protection Clause, we look to the Constitution to see if the right infringed has its source, explicitly or
implicitly, therein. But we have also recognized the fundamentality of participation in state elections on
an equal basis with other citizens in the jurisdiction, Dunn v. Blumstein, 405 U.S. 330, 336 (1972), even
though the right to vote, per se, is not a constitutionally protected right. San Antonio Independent School
District, pp. 35, n. 78. With respect to suffrage, we have explained the need for strict scrutiny as arising
from the significance of the franchise, as the guardian of all other rights. See Harper v. Virginia Bd. of
Elections, 383 U.S. 663, 667 (1966); Reynolds v. Sims, 377 U.S. 533,562 (1964); Yick Wo v. Hopkins, 118
U.S. 356, 370 (1886). Ed.]


172
basis upon which the particular classification is drawn. It continues to be my view that
a class-based denial of public education is utterly incompatible with the Equal Protection
Clause of the Fourteenth Amendment. BLACKMUN, J., concurring
JUSTICE BLACKMUN, concurring.
I join the opinion and judgment of the Court.
Like JUSTICE POWELL, I believe that the children involved in this litigation
should not be left on the streets uneducated.87 I write separately, however, because, in
my view, the nature of the interest at stake is crucial to the proper resolution of these
cases.
The fundamental rights aspect of the Court's equal protection analysis the
now-familiar concept that governmental classifications bearing on certain interests must
be closely scrutinized -- has been the subject of some controversy. Justice Harlan, for
example, warned that virtually every state statute affects important rights.... To extend
the compelling interest rule to all cases in which such rights are affected would go far
toward making this Court a superlegislature.88 Others have noted that strict scrutiny
under the Equal Protection Clause is unnecessary when classifications infringing
enumerated constitutional rights are involved, for a state law that impinges upon a
substantive right or liberty created or conferred by the Constitution is, of course,
presumptively invalid, whether or not the law's purpose or effect is to create any
86 Ibid., p. 99. See also Dandridge v. Williams, 397 U.S. 471, (1970) (MARSHALL, J., dissenting).
87 Inf. p. 238.
88 Shapiro v. Thompson, 394 U.S. 618, 661 (1969) (dissenting opinion).


116
services to immigrant students; and developed strong working relationships with
immigrant families.
Teachers, administrators, and other school staff worked to treat undocumented
students with the same respect and care they showed for other students. Effective
instruction, productive school climate, parent involvement, the methods of sound
bilingual education, all are needed by undocumented students, as they are by other
immigrant, bilingual, and special needs students.55
Access to public schools in the United States entitled undocumented students to
varied benefits provided by a number of special programs. These programs included: (1)
the Emergency Immigrant Education Program;56 (2) Funds received under Section 204 of
the Immigrant Reform and Control Act; (3) the Transitional Program for Refugee
Children: (4) Bilingual education programs; (5) Chapter I programs; (6) Headstart
programs; (7) Special education: and (8) Free and reduced meal programs.57
Immigrant Students
Most immigrant children and their families lived in six states (California, Florida,
co
Illinois, New Jersey, New York, and Texas), and most lived in metropolitan areas.
According to the U.S. Department of Education, 78 percent of all immigrant students
attended school in just five states (California, Florida, Illinois, New York and Texas),
55 J. Willshire Carrera, Immigrant Students: Their Legal Right Of Access To Public Schools: A Guide For
Advocates And Educators, Boston, MA, (National Coalition of Advocates for Students, 1989b).
56 The Emergency Immigrant Education Act (EIEA), Title IV, part D of the Elementary and Secondary
Education Act, as amended, (20 U.S.C. 3121-3130).
57 Ibid.
58 Immigrant Children and Their Families: Issues for Research and Policy, The Future of Children, Vol. 5,
No. 2, Summer/Fall 1995.


9
Immigration Policy
Congress made several substantive changes to immigration policy after 1965.
The patterns of immigration and the policy considerations relating to it in the 1970s
resembled, in some respects, those of the decade of the 1950s after the enactment of the
Immigration and Nationality Act.31 In both decades, the entry of aliens outside the
provisions of the basic law-both illegally as undocumented aliens, and legally as
refugeeswas increasingly the dominant pattern in immigration and the basis for the
major issues confronting Congress.
Legislative response to the issue of refugees in 1980 with the Refugee Act of
1980, and undocumented aliens in 1986, the Immigration Reform and Control Act,
was followed in 1987 by a shift in congressional attention to legal immigration.34
The Immigration Reform and Control Act of 1986 (IRCA) granted amnesty to certain
illegal immigrants and mandated employer sanctions for those hiring illegal immigrants
as a way to deter future arrivals.35
The Immigration Act of 199036 increased the number of available immigrant visas
to 700,000 from the prior limit of 490,000 for fiscal years 1992-93 and 1993-94, and to
675,000 thereafter. Therefore, proposals to cut immigration by one-third did nothing
31 McCarran-Walter Act, ch. 477, 66 Stat. 163, 8 U.S.C. § 1101 et seq. as amended throughout 8 U.S.C.
12 Refugee Act of March 17, 1980, Immigration and Nationality Act, [101(a)(42)(A)].
33 Immigration Reform and Control Act, Pub. L. 99-603, 100 Stat. 3359 (1986).
34 The 1970s Through 1990s: Immigration Issues, Review, and Revision March 1996.
35 Immigration Reform and Control Act, Pub. L. 99-603, 100 Stat. 3359 (1986).
36 The Immigration Act of 1990, Pub. L. No. 101-649 §§ 111-24, 104 Stat. 4978-97 (1990).


82
stay in the United States; and many aliens, although deportable, could have been granted
discretionary relief that allowed them to remain.80 Here, too, the California statute
conflicted with federal legislation.81
Due Process
Plaintiffs also argued that Proposition 187's procedure violated the Fourteenth
Amendment's Due Process clause by threatening to take away valuable rights or interests
without a prior hearing. Public assistance, for example, was an interest that could not be
cut off without a pre-termination hearing.82 Due process also required a hearing before a
deportation order could be entered.83 Proposition 187 therefore violated the Constitution
when it instructed state employees to terminate a woman's pre-natal care or turn a child
out of school and then directed the parties to leave the United States without a hearing
or other means of evaluating their rights.84
The same equal protection, supremacy and due process provisions that controlled
Proposition 187, challenged other states as they considered what to do about
undocumented aliens. And a state law must also have passed muster under its own
constitution. For example, a provision of New York's constitution that mandated support
of the needy, unequivocally prevents the Legislature from simply refusing to aid those
80 See, e.g., INA Sec.Sec.208, 243(h), 24, 245, USC Sec.Sec.l 158, 1252(h).
81 Mailman, 187 and Its Lessons, p.3, col.l.
82 Goldberg v. Kelly, 397 U.S. 254 (1970).
83 Wong Yang Sung v. McGrath, 339 U.S. 33 (1950), modified, 339 U.S. 908.
84 Mailman, 187 and Its Lessons, p.3, col.l.


92
A federal judge disposed of the lawsuit, and the 11th U.S. Circuit Court of
Appeals upheld the dismissal.116 The appeals court ruled that Federal immigration law
allowed the attorney general to decide how it was enforced, adding that Florida's other
claims were political questions that could not be decided by courts.117
In the appeal, Florida Attorney General Robert A. Butterworth said, If the
national government chose to enforce the immigration laws, Florida's expenditures for
education and law enforcement on behalf of its alien population would not be
1 io
necessary. (Five other states -- New York, California, Arizona, Texas and New
Jersey have had similar lawsuits thrown out by federal judges.)
As the number of foreign-bom and limited English proficient (LEP) students grew
in Florida, so did the number of issues and concerns about the entry of these students to
public schools. In a technical assistance paper dated June 23, 1995, from the Deputy
Commissioner for Education Programs, policies and procedures for student admittance
were outlined for local school districts. The assistance paper addressed homeless
children, in that they would be admitted to school in the district in which they resided.
School districts would assist homeless children to meet the requirements for school
entry.119 It also emphasized that districts could not require any evidence of United
States citizenship for enrollment.120 No district could classify students as non-residents
116 Ibid.
1,7 Ibid.
118 Chiles vs. U.S., 95-1249.
119Consent Decree, [s. 232.01 (l)(f), FS], Compulsory School Attendance.
120
Ibid.


192
basis.160 The Court has failed to offer even a plausible explanation why illegality of
residence [457 U.S. 251] in this country is not a factor that may legitimately bear upon
the bona fides of state residence and entitlement to the benefits of lawful residence.161
It is significant that the Federal Government has seen fit to exclude illegal aliens
from numerous social welfare programs, such as the food stamp program, the old-age
assistance, aid to families with dependent children, aid to the blind, aid to the
permanently and totally disabled, and supplemental security income programs the
Medicare hospital insurance benefits program,164 and the Medicaid hospital insurance
benefits for the aged and disabled program.165 Although these exclusions do not
conclusively demonstrate the constitutionality of the State's use of the same classification
for comparable purposes, at the very least they tend to support the rationality of
160 Vlandis v. Kline, 412 U.S. 441, 453 (1973) (emphasis added). See also Elkins v. Moreno, 435 U.S. 647,
(1978).
151 [The Court's opinion is disingenuous when it suggests that the State has merely picked a disfavored
group and arbitrarily defined its members as nonresidents, p. 227, n. 22. Appellees disfavored status
stems from the very fact that federal law explicitly prohibits them from being in this country. Moreover,
the analogies to Virginians or legally admitted Mexican citizens entering Texas, Ibid., are spurious. A
Virginian's right to migrate to Texas, without penalty, is protected by the Constitution, see, e.g., Shapiro v.
Thompson, 394 U.S. 618 (1969); and a lawfully admitted alien's right to enter the State is likewise
protected by federal law. See Takahashi v. Fish & Game Commission, 334 U.S. 410 (1948). Cf. Zobel v.
Williams]
162 7 U.S.C. 2015(f) (1976 ed. and Supp. IV) and 7 CFR 273.4 (1981).
163 45 CFR 233.50(1981).
164 42 U.S.C. 1395-2 and 42 CFR 405.205(b) (1981).
165 42 U.S.C. 1395o and 42 CFR 405.103(a)(4) (1981). [It is true that the Constitution imposes lesser
constraints on the Federal Government than on the states with regard to discrimination against lawfully
admitted aliens. E.g., Mathews v. Diaz, 426 U.S. 67 (1976); Hampton v. Mow Sun Wong, 426 U.S. 88
(1976). This is because Congress and the President have broad power over immigration and naturalization
which the States do not possess, Hampton, p. 95, and because state discrimination against legally resident
aliens conflicts with and alters the conditions lawfully imposed by Congress upon admission, naturalization
and residence of aliens in the United States or the several states. Takahashi v. Fish & Game Commission,
334 U.S. 410,419 (1948). However, the same cannot be said when Congress has decreed that certain
aliens should not be admitted to the United States at all.]


66
One of the generic arguments against public benefits for immigrants was that such
benefits were an unwelcome lure. In the case of undocumented immigrants, a
counterargument was that the legally available benefits were too meager to have had that
effect; a desire to work, a desire to rejoin their families or to escape persecution, were far
more believable explanations.23
The public benefits that gave rise to the debate in areas as vital as health and
education were central to life opportunity. Depriving a morally innocent child of medical
care or an education was considered extreme. Moreover, denying certain benefits to
otherwise eligible undocumented immigrants at times caused tangible harm to United
States citizen children in the same household, a problem to which even the Commission
on Immigration Reform had called attention.24
Immigration Laws
Immigration law and policy changed substantially during the 1900s. Historically,
immigration policy in the United States was based on a per-country quota system. The
first true codification of immigration law resulted from the passage of the Immigration
and Nationality Act of 1952.25 This was the initial attempt to give priority to those
immigrants with highly valued skills. Family reunification became a priority in 1965
with the Immigration and Nationality Act amendments. This act also abolished the
national quota system, eliminating national origin, race, or ancestry as a basis for
23 Ibid., p. 30.
24 42 UCLA Law Rev. rev. 1470.
25 Immigration and Nationality Act, Public Law 82-414, (1952).
26 Immigration and Nationality Act Amendments of October 3, 1965, (79 Stat. 911).


70
the Western Hemisphere. There was not even an attempt to monitor the borders until
-30
1924. Mexican workers, in particular, were a critical part of the labor force in the
southwest, but they generally worked in agriculture during the growing season and then
returned to their homes in Mexico. From the beginning of World War II, as American
recruits were sent overseas until 1964, the Bracero Program39 gave this arrangement
official status, permitting the entry of 4 million to 5 million temporary agricultural
workers to fill the farm labor shortage.40
Since the 1960s, both the forces pushing illegal aliens northward and those
attracting them to the United States had grown stronger. In 1972, the INS caught about
500,000 illegal aliens crossing the border.41 In 1986, the year that the Immigration
Reform and Control Act42 was enacted, that figure had increased to nearly 1.8 million.
The composition of the illegal alien population had changed in the previous two decades.
Although the typical illegal alien was still a single young man, more women and children
were entering the country illegally as well. Less than one-quarter of illegal aliens worked
in agriculture. The majority lived and worked in large cities. In addition, Mexicans
made up a smaller proportion of illegal aliens than in the past. Increasingly, illegal aliens
were arriving from Central America, the Caribbean, and East Asia. In 1984, for example,
38 The Immigration Act of May 26, 1924 (43 Statutes-at-Large 153), together with the Immigration Act of
1917 (39 Statutes-at-Large 874), governed American immigration policy until 1952. At the same time,
Congress established the Border Patrol in response to the concern with increased illegal movement across
the borders with Canada and Mexico.
39 In 1942 the Bracero Program ( also know as the Mexican Farm Labor Supply Program) was begun in
order to allow entry to agricultural workers on a temporary basis.
40 Gimpel and Edwards. Congressional Politics, p. 71.
41 Peter H. Schuck, The Meaning of 187: Facing Up to Illegal Immigration, The American Prospect No.
21, Spring 1995.
42 Immigration Reform and Control Act of 1986, Public Law 99-603.


128
Distinctions
It was important to recognize the distinction of the two types of alien policies,
immigrant and immigration. Immigrant policy focused on what to do about the effects of
immigration upon our society. Immigrant policy addressed the question: What shall we
do about immigrants once they are here? Common immigrant policy debates included
whether bilingual education helped or hindered the children of immigrants, whether
immigrants could receive welfare, and whether non-citizens residents could have voting
rights. Immigrant policy was decided at the state level. Immigration policy focused on
what to do about the laws that admitted immigrants to our country and that created
immigration flow. Immigration policy addressed the question: Who and how many
people should be allowed to immigrate? Examples of immigration policy debate
included whether there could be an overall cap on immigration, how chain migration
could be limited, and why so many unskilled immigrants were being admitted.
Immigration policy was a federal responsibility.
Immigration Facts
The Immigration and Naturalization Service (INS) estimate of illegal immigrants
in Florida in October 1996 was about 350,000. The INS estimated the illegal resident
alien population in Florida as of October 1992 was 270,000. This was the fourth largest
concentration of illegal aliens in the country, and it reflected a 30 percent increase over
the previous four years. These were mostly new illegal resident aliens, as the amnesty for
illegal aliens, for which 156,000 applied from Florida, converted the bulk of older illegal
2 Immigration Policy versus Immigrant Policy, October 1997. FAIR
3 Ibid.


119
Immigrant children with limited English proficiency were eligible to participate in
school programs funded by the Bilingual Education Act68, which authorized the
Emergency Immigrant Education program. They could take part in English as a second
language (ESL) or Limited English proficiency (LEP) programs.69
To the extent that the focus of attention was on immigrant students with limited
English proficiency, states, especially those with large numbers of LEP students, had
policies and programs that offered language assistance, due in large part to the Civil
Rights Act and other federal and state laws.
Additional policy issues that created challenges to educators included the training
of teachers to address the special needs of immigrant students, development of
appropriate instructional materials for immigrant students, and ensuring that there were
70
assessment instruments in languages other than English and Spanish.
Ethics And The Democracy Of Education
Formal instruction in the United States was originally begun as a means to teach
the Bible.71
What the best and wisest parent wants for his own child, that must
the community want for all of its children. 72 John Dewey
68 Emergency Education Act of 1984.
69 Immigrant Children and Their Families: Issues for Research and Policy, The Future of Children, Vol. 5,
No. 2, Summer/Fall 1995.
70 Ibid.
71 Moral Education in the Ufe of the School. Association for Supervision and Curriculum Development,
Educational Leadership, 46, 4-8. (May 1988).
72 Raymond D. Boisvert, John Dewey: Rethinking Our Time, State University of New York Press, Albany,
NY. p.95 (1998).


174
Clause, because they are not distinguishable in any relevant way from other regulations in
the area of economics and social welfare.94
With all this said, however, I believe the Court's experience has demonstrated that
the Rodriguez formulation does not settle every issue of fundamental rights arising
under the Equal Protection Clause.95 Only a pedant would insist that there are no
meaningful distinctions among the multitude of social and political interests regulated by
the States, and Rodriguez does not stand for quite so absolute a proposition. To the
contrary, Rodriguez implicitly acknowledged that certain interests, though not
constitutionally guaranteed, must be accorded a special place in equal protection analysis.
Thus, the Court's decisions long have accorded strict scrutiny to classifications bearing on
the right to vote in state elections, and Rodriguez confirmed the constitutional
underpinnings of the right to equal treatment in the voting process.96 Yet the right to
vote, per se, is not a constitutionally protected right,97 Instead, regulation of the
electoral process receives unusual scrutiny because the right to exercise the franchise in
a free and unimpaired manner is preservative of other basic civil and political rights.
In other words, the right to vote is accorded extraordinary treatment because it is, in equal
protection terms, an extraordinary right: a citizen cannot hope to achieve any meaningful
degree of individual political equality if granted an inferior right of participation in the
94 Ibid.,
95 457 U.S. 233
96 411 U.S. p. 34, n. 74.
97 Ibid., p. 35, n. 78. See Harper v. Virginia Board of Elections, 383 U.S. 663,665 (1966); Rodriguez, 411
U.S. p. 59, n. 2 (Stewart, J., concurring).
98 Reynolds v. Sims, 377 U.S. 533, 562 (1964). See Dunn v. Blumstein, 405 U.S. 330, 336 (1972).


138
All public school teachers within the state of Florida were required by the
Consent Decree and Florida Statutes to have three semester hours or 60 in-
service credit points of training in the methods of teaching students of
limited English proficiency. In addition, certification as an ESOL teacher
required 15 semester credit hours or 300 in-service credit points in the
methods of teaching English to ESOL students, ESOL curriculum and
materials development, cross-cultural communication and understanding,
testing and evaluation of ESOL students and applied linguistics.
Supplementary staff preparation on the needs and cultural heritage of the
undocumented immigrant student was needed. Monetary incentives could
have increased participation of teachers.
3) Development of additional instructional materials for immigrant children;
Instructional materials for ESOL programs were available to Florida
school districts. Many books were available in dual languages, which
accelerated the assimilation of the English language for many of the
immigrant students. Additional integration materials, to assist with basic
subject instruction such as mathematics, and computer literacy, needed to
be developed and put into practice. Utilizing experiential learning
techniques in the non-ESOL classroom would have assisted immigrant
students with learning and understanding of concepts. The development
of materials was costly but made possible by grants and other funding.
4) Assessment instruments in languages other than English and Spanish;


36
Not until the 1930s and 1940s (the very lowest period of 20th century immigrationand
the beginning of modem American confidence in assimilation) did the Statue of Liberty
begin to represent the immigrant in the eyes of most Americans.
The mechanics of assimilation were very complicated but included such factors as
political participation, economic and employment markets, education, residential patterns,
^ i
economic class, and even factors such as leisure time activities. The relationship
between the 1920s legislation and assimilation was necessary because reduced ethnic
conflict and emergent American commonality led directly to the theme of confidence in
the American assimilative capacity which the United States Supreme Court in Plyler32
took for granted.
The term family dynamic was used to hypothesize that the children of
intermarriage help created a new culture by assimilating the traits of their parents and
relatives with the larger culture to which they were exposed. An important part of this
theory was that people who did not intermarry faced pressure to exhibit heightened
tolerance and sensitivity toward children of those relatives who did intermarry. Foreign-
bom immigrants (and natives) had significant and strong prejudices. Their children had
less.
The family dynamic produced various compromises from which acceptable
social deviation could be judged. This effect accounted for the fact that food, dance,
some language, work habits, leisure activities, holidays, etc., tended to be retained longer
30 Ibid.
31 Kenneth L. Karst, Paths to Belonging: The Constitution and Cultural Identity, 64 N.C.L. REV. 303,
331-336 (1986); quoted in Van De Mark.



PAGE 1

,00,*5$7,21 $1' ('8&$7,21 /(*,6/$7,21 $1' ,76 ())(&76 21 32/,&,(6 5(/$7,1* 72 81'2&80(17(' ,00,*5$17 &+,/'5(1 %\ 526( $/9,1( 5$6.$ $ ',66(57$7,21 35(6(17(' 72 7+( *5$'8$7( 6&+22/ 2) 7+( 81,9(56,7< 2) )/25,'$ ,1 3$57,$/ )8/),//0(17 2) 7+( 5(48,5(0(176 )25 7+( '(*5(( 2) '2&725 2) 3+,/2623+< 81,9(56,7< 2) )/25,'$

PAGE 2

'(',&$7(' 72 *HUPDLQH %RXUTXH 5DVND f P\ PRVW ZRQGHUIXO 0RWKHU ZLWKRXW ZKRVH VSLULW LQVSLUDWLRQ DQG EHOLHI LQ PH ZRXOG QRW KDYH DWWHPSWHG VXFK D PRQXPHQWDO WDVN X

PAGE 3

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ƒ

PAGE 4

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

PAGE 5

7KH ,PPLJUDWLRQ $FW ,PPLJUDWLRQ 3ROLF\ $IWHU (GXFDWLQJ ,OOHJDO ,PPLJUDQW &KLOGUHQ 6XPPDU\ ,00,*5$7,21 /$:6 $1' 352326,7,21 ,QWURGXFWLRQ %DFNJURXQG ,PPLJUDWLRQ /DZV ,OOHJDO $OLHQV 3URSRVLWLRQ &RQVWLWXWLRQDO 9LRODWLRQV &RQIOLFW ZLWK )HGHUDO /DZV 'XH 3URFHVV ,PPLJUDWLRQ DQG (GXFDWLRQ )ORULGD ,PPLJUDWLRQ DQG (GXFDWLRQ 6XPPDU\ ),1$1&,$/ $1' (7+,&$/ &216,'(5$7,216 ,QWURGXFWLRQ /HJDO %DVLV IRU 6WDWHVn 5HVSRQVLELOLWLHV (GXFDWLRQ )LQDQFH )ORULGD (GXFDWLRQ )LQDQFH 3RSXODWLRQ 'DWD ,OO (GXFDWLRQDO 5LJKWV RI 8QGRFXPHQWHG ,PPLJUDQW 6WXGHQWV ,PPLJUDQW 6WXGHQWV (WKLFV DQG WKH 'HPRFUDF\ RI (GXFDWLRQ (GXFDWLQJ $OO &KLOGUHQ 6XPPDU\ ,00,*5$7,21 ('8&$7,21 32/,&< ,1&/86,216 )25 7+( 67$7( 2) )/25,'$ ,QWURGXFWLRQ 7KH 5LJKW WR /HDUQ 'LVWLQFWLRQV ,PPLJUDWLRQ )DFWV )HGHUDO 3ROLFLHV DQG /DZV )ORULGD /HJLVODWLRQ )ORULGD 6FKRRO /DZV )ORULGDnV (GXFDWLRQ 6WUDWHJLF 3ULRULWLHV 3ROLF\ (QKDQFHPHQWV 6XPPDU\ Y

PAGE 6

$33(1',; /,67 2) 5()(5(1&(6 /(*$/ 5()(5(1&(6 %,2*5$3+,&$/ 6.(7&+ YL

PAGE 7

/,67 2) 7$%/(6 7DEOH SDJH (VWLPDWHG ,OOHJDO ,PPLJUDQW 3RSXODWLRQ IRU 7RS 7ZHQW\ &RXQWULHV RI 2ULJLQ DQG 7RS 7ZHQW\ 6WDWHV RI 5HVLGHQFH 2FWREHU 7LPHOLQH RI 86 ,PPLJUDWLRQ DQG $OLHQ (GXFDWLRQ 3ROLFLHV ,PPLJUDWLRQ WR WKH 86 LQ )ORULGD (,(3 6WXGHQW )XQGLQJ b )HGHUDO )XQGLQJf ,PPLJUDWLRQ DQG )ORULGD ,OO YL

PAGE 8

/,67 2) ),*85(6 )LJXUH SDJH 6FKRRO$JH ,PPLJUDQW 3RSXODWLRQ 86 )RUHLJQ%RP 3RSXODWLRQ 7RS 7HQ 6WDWHV :KHUH ,OOHJDO $OLHQV 5HVLGH (VWLPDWHG 8QGRFXPHQWHG ,PPLJUDQW 3RSXODWLRQ LQ )ORULGD LQ E\ &RXQWU\ RI 2ULJLQ +HUH LV D ILJXUH YP

PAGE 9

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f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

PAGE 10

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f ,PPLJUDQW VWXGHQW LQFOXVLRQ LQ DOO VFKRRO DQG GLVWULFW DVVHVVPHQWV f VWDII GHYHORSPHQW WUDLQLQJ LQ WKH XQGHUVWDQGLQJ RI WKH VSHFLDO QHHGV RI LPPLJUDQW FKLOGUHQ f GHYHORSPHQW RI DGGLWLRQDO LQVWUXFWLRQDO PDWHULDOV IRU LPPLJUDQW FKLOGUHQ f DVVHVVPHQW LQVWUXPHQWV LQ ODQJXDJHV RWKHU WKDQ (QJOLVK DQG 6SDQLVK f LQFUHDVHG VFKRRO FRXQVHOLQJ VHUYLFHV IRU LPPLJUDQW FKLOGUHQ f LQFUHDVHG LPPLJUDQW SDUHQW LQYROYHPHQW LQ RYHUDOO VFKRRO SURJUDPV f ,QFOXVLRQ RI OLPLWHG (QJOLVK SURILFLHQW FKLOGUHQ LQ VFKRROZLGH SURJUDPV DQG f D GHWHUPLQDWLRQ RI ZKDW LQYHVWPHQWV WKH SXEOLF ZDV ZLOOLQJ WR PDNH WR HQVXUH WKH HGXFDWLRQ DQG IXWXUH HFRQRPLF VXFFHVV RI LPPLJUDQW FKLOGUHQ [

PAGE 11

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f)HGHUDO DQG 6WDWH 5HVSRQVLELOLW\ IRU 8QGRFXPHQWHG ,PPLJUDWLRQf %HUNHOH\ 0F1DLU -RXUQDO 7KUHH QR 6XPPHU f ZZZDDGEHUNHOH\HGXMRXPDO!

PAGE 12

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fV VFKRRODJH SRSXODWLRQ PLUURUHG RU H[FHHGHG WKRVH RFFXUULQJ LQ WKH VWDWHf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f 6WXGHQW (QUROOPHQW )LJXUHV E\ (WKQLFLW\ DQG 5DFH 7DOODKDVVHH ), 6WUDWHJ\ 3ODQQLQJ 'HSDUWPHQW )ORULGD 'HSDUWPHQW RI (GXFDWLRQ

PAGE 13

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f

PAGE 14

+LVWRU\ 2SSRVLWLRQ WR WKH HQWU\ RI IRUHLJQ SDXSHUV DQG DOLHQV fOLNHO\ DW DQ\ WLPH WR EHFRPH D SXEOLF FKDUJHf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fVWUDQJHUVLQQHHGf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fDQ\ SHUVRQ XQDEOH WR WDNH FDUH RI KLPVHOI RU KHUVHOI ZLWKRXW EHFRPLQJ D SXEOLF FKDUJHf ZDV LQFOXGHG LQ WKH ILUVW JHQHUDO IHGHUDO LPPLJUDWLRQ ODZ WKH &KLQHVH ([FOXVLRQ $FW RI $XJXVW ZKLFK 86 +RXVH RI 5HSUHVHQWDWLYHV :D\V DQG 0HDQV &RPPLWWHH 3ULQW >*UHHQ %RRN@ f$SSHQGL[ 1RQFLWL]HQVf 7KH 3HUVRQDO 5HVSRQVLELOLW\ DQG :RUN 2SSRUWXQLW\ 5HFRQFLOLDWLRQ $FW DQG $VVRFLDWHG /HJLVODWLRQ KWWSZZZDFFHVVJSR DRYFHA )HEUXDU\ f &KLQHVH ([FOXVLRQ $FW FK 6WDW IRUPHUO\ FRGLILHG LQ VFDWWHUHG SDUWV RI 86& FKf

PAGE 15

HVWDEOLVKHG EURDG OHJDO OLPLWV WR LPPLJUDWLRQ E\ H[FOXGLQJ $VLDQ LPPLJUDWLRQ 7KH ODZ DOVR VROLGLILHG WKH SULPDF\ RI WKH IHGHUDO JRYHUQPHQW WR GHWHUPLQH LPPLJUDWLRQ ODZ DQG SROLF\ 7KLV SURKLELWLRQ ZDV FDUULHG IRUZDUG LQ WKH ,PPLJUDWLRQ $FW RI DQG ZDV UHFRGLILHG LQ WKH ,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW ERWK ZKHQ LW ZDV HQDFWHG RQ -XQH DQG DJDLQ LQ 7KH FRQWURYHUV\ RYHU LOOHJDO LPPLJUDWLRQ EHJDQ LQ ZKHQ WKH 86 HVWDEOLVKHG LWV ILUVW ODZ UHVWULFWLQJ LPPLJUDWLRQ ZKLFK SURKLELWHG WKH HQWUDQFH RI FRQYLFWV DQG SURVWLWXWHV 6LQFH WKDW WLPH WKH 86 VWUXJJOHG WR FRQWURO LWV ERUGHUV (YHU\ \HDU WKRXVDQGV PRUH IRXQG SDVVDJH LQ DGGLQJ WR WKH DOUHDG\ ILYH PLOOLRQ LPPLJUDQWV ZKR KDG HQWHUHG WKH FRXQWU\ LOOHJDOO\ RU RYHUVWD\HG WKHLU YLVDV )URP WR SHRSOH LPPLJUDWHG WR WKH 8QLWHG 6WDWHV WKH JUHDW PDMRULW\ RI WKHVH LPPLJUDQWV ZHUH IURP VRXWKHUQ DQG HDVWHUQ (XURSH 3XEOLF DJLWDWLRQ JUHZ VWHDGLO\ GXULQJ WKLV SHULRG WR OLPLW IXUWKHU LPPLJUDWLRQ GHVSLWH WKH RSSRVLWLRQ RI EXVLQHVV LQWHUHVWV )HGHUDO SRZHU RYHU LPPLJUDWLRQ OLHV LQ WKH 8QLWHG 6WDWHV &RQVWLWXWLRQ f7R HVWDEOLVK DQ XQLIRUP 5XOH RI 1DWXUDOL]DWLRQf 86 &RQVWLWXWLRQ $UW i FO 86 +RXVH RI UHSUHVHQWDWLYHV :D\V $QG 0HDQV &RPPLWWHH 3ULQW > *UHHQ %RRN@ f$SSHQGL[ 1RQFLWL]HQVf 7KH 3HUVRQDO 5HVSRQVLELOLW\ DQG :RUN 2SSRUWXQLW\ 5HFRQFLOLDWLRQ $FW DQG $VVRFLDWHG /HJLVODWLRQ KWWSZZZDFFHVVJSRJRYFJL! )HEUXDU\ f .DWKOHHQ 9DLO f1R (QWU\f 7KH $PHULFDQ 6FKRRO %RDUG -RXUQDO QR 6HSWHPEHU f 0DULRQ 7 %HQQHWW $PHULFDQ ,PPLJUDWLRQ 3ROLFLHV $ +LVWRU\ f TXRWHG LQ *UHJJ 9DQ 'H 0DUN f7RR 0XFK RI D *RRG 7KLQJf :DVKLQJWRQ /DZ -RXUQDO QR 6SULQJ f 7KH PDLQ FRQFHUQV RI WKRVH SXVKLQJ IRU LPPLJUDWLRQ FRQWUROV ZHUH WKH DVVLPLODELOLW\ RI WKH QHZ LPPLJUDQWV WKHLU VKHHU QXPEHUV DQG WKHLU HIIHFW RQ WKH QDWLRQnV SROLWLFV ODQJXDJH DQG FXOWXUH 7KRPDV $ $OLHQNRII DQG 'DYLG 0DUWLQ ,PPLJUDWLRQ 3URFHVV DQG 3ROLF\ SS LQWHULP G HG f TXRWHG LQ 9DQ 'H 0DUN :DVKLQJWRQ /DZ -RXUQDO

PAGE 16

7KH 4XRWD $FW RI 0D\ FUHDWHG D 1DWLRQDO 2ULJLQV SODQ XQGHU ZKLFK HDFK FRXQWU\ KDG DQ LPPLJUDWLRQ TXRWD LQ SURSRUWLRQ WR WKDW QDWLRQf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f E\ GLOXWLQJ WKH DELOLW\ RI FXUUHQW UHVLGHQWV WR GHWHUPLQH WKH QDWLRQnV GHVWLQ\ 7KH $FW PDLQWDLQHG WKH H[HPSWLRQ IRU WKH LQGHSHQGHQW FRXQWULHV RI WKH :HVWHUQ +HPLVSKHUH IURP DQ\ TXRWDV 7KH FHQVXV VHUYHG DV DQ LQWHULP SURYLVLRQ XQWLO &RQJUHVV HVWDEOLVKHG WKH ILQDO QDWLRQDO RULJLQV V\VWHP LQ 7KHUHDIWHU &RQJUHVV VHW WKH QDWLRQDO RULJLQV TXRWD DW RQHVL[WK RI RQH SHUFHQW RI WKH SRSXODWLRQ WR DUULYH DW D EDVH LPPLJUDWLRQ ILJXUH RI 7KH fV OHJLVODWLRQ HIIHFWLYHO\ VWRSSHG ODUJHVFDOH LPPLJUDWLRQ WR WKH 8QLWHG 6WDWHV IRU IRUW\ \HDUV &RQILGHQFH LQ $PHULFDQ LQVWLWXWLRQV WKH UHDOLWLHV RI :RUOG :DU ,, DOOLDQFHV DQG SRVWZDU IRUHLJQ DIIDLUV FRPELQHG WR FKDOOHQJH WKH EDVLV RI $PHULFDnV LPPLJUDWLRQ 4XRWD $FW FK 6WDW f IRUPHUO\ FRGLILHG DW 86& ii f ,ELG 7KH ,PPLJUDWLRQ $FW RI FK 6WDW f IRUPHUO\ FRGLILHG DW 86& ii f %HQQHWW $PHULFDQ ,PPLJUDWLRQ 3ROLFLHV S $FW RI -XO\ FK 6WDW IRUPHUO\ FRGLILHG DW 86& i Ff ,ELG

PAGE 17

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fV KLVWRU\ RI UDFLVP FRQWLQXHG ZLWK UHQHZHG IHUYRU GXULQJ WKH GHFDGH RI WKH V &RQJUHVV SDVVHG VXFK *UHJJ 9DQ 'H 0DUN 7RR 0XFK RI D *RRG 7KLQJ :DVKEXUQ /DZ -RXUQDO QR 6SULQJ f KWWSZDVKEXUQODZZXDFFHGXVFKRROSXEOLFWQVZOM! &RQJUHVV UHSHDOHG WKH &KLQHVH ([FOXVLRQ $FW E\ WKH $FW RI 'HFHPEHU FK 6WDW IRUPHUO\ FRGLILHG DW 86& ii ff 0F&DUUDQ:DOWHU $FW FK 6WDW 86& i f,ELG &21*5(66,21$/ 5(&25' SW S f ,ELG

PAGE 18

OHJLVODWLRQ DV WKH &LYLO 5LJKWV $FW DQG WKH 9RWLQJ 5LJKWV $FW LQ UHVSRQVH WR WKH QHZ DFWLYLVW PRRG 7KH ,PPLJUDWLRQ $FW DEROLVKHG WKH ROG QDWLRQDO RULJLQV IRUPXOD (DFK FRXQWU\ RXWVLGH RI WKH :HVWHUQ +HPLVSKHUH UHFHLYHG XQOLPLWHG YLVDV IRU UHODWLYHV RI FLWL]HQV DQG YLVDV IRU RUGLQDU\ LPPLJUDQWV 7KH $FW VHW TXRWDV RQ LPPLJUDWLRQ IURP WKH QDWLRQV RI WKH :HVWHUQ +HPLVSKHUH IRU WKH ILUVW WLPH 7KH $FW DOVR RIIHUHG D ILUVWLQWLPH ILUVWLQULJKW V\VWHP IRU LPPLJUDQWV QRW UHODWHG WR 8QLWHG 6WDWHV f f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f ,PPLJUDWLRQ $FW RI 3XE / 1R 6WDW FRGLILHG DV DPHQGHG DW 86& i f %LOO 2QJ +LQJ 0DNLQJ DQG 5HPDNLQJ $VLD $PHULFD WKURXJK ,PPLJUDWLRQ 3ROLF\ [ SS f TXRWHG LQ 9DQ 'H 0DUN 7RR 0XFK RI D *RRG 7KLQJ ,ELG %XUHDX RI WKH &HQVXV 86 'HSDUWPHQW RI &RPPHUFH &HQVXV 3RSXODWLRQ RI &KDUDFWHULVWLFV RI WKH 3RSXODWLRQ SW DW WEO f %XUHDX RI WKH &HQVXV 86 'HSDUWPHQW RI &RPPHUFH &HQVXV RI 3RSXODWLRQ *HQHUDO 3RSXODWLRQ &KDUDFWHULVWLFV WEO f

PAGE 19

,PPLJUDWLRQ 3ROLF\ &RQJUHVV PDGH VHYHUDO VXEVWDQWLYH FKDQJHV WR LPPLJUDWLRQ SROLF\ DIWHU 7KH SDWWHUQV RI LPPLJUDWLRQ DQG WKH SROLF\ FRQVLGHUDWLRQV UHODWLQJ WR LW LQ WKH V UHVHPEOHG LQ VRPH UHVSHFWV WKRVH RI WKH GHFDGH RI WKH V DIWHU WKH HQDFWPHQW RI WKH ,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW ,Q ERWK GHFDGHV WKH HQWU\ RI DOLHQV RXWVLGH WKH SURYLVLRQV RI WKH EDVLF ODZERWK LOOHJDOO\ DV XQGRFXPHQWHG DOLHQV DQG OHJDOO\ DV UHIXJHHVf§ZDV LQFUHDVLQJO\ WKH GRPLQDQW SDWWHUQ LQ LPPLJUDWLRQ DQG WKH EDVLV IRU WKH PDMRU LVVXHV FRQIURQWLQJ &RQJUHVV /HJLVODWLYH UHVSRQVH WR WKH LVVXH RI UHIXJHHV LQ ZLWK WKH 5HIXJHH $FW RI DQG XQGRFXPHQWHG DOLHQV LQ WKH ,PPLJUDWLRQ 5HIRUP DQG &RQWURO $FW ZDV IROORZHG LQ E\ D VKLIW LQ FRQJUHVVLRQDO DWWHQWLRQ WR OHJDO LPPLJUDWLRQ 7KH ,PPLJUDWLRQ 5HIRUP DQG &RQWURO $FW RI ,5&$f JUDQWHG DPQHVW\ WR FHUWDLQ LOOHJDO LPPLJUDQWV DQG PDQGDWHG HPSOR\HU VDQFWLRQV IRU WKRVH KLULQJ LOOHJDO LPPLJUDQWV DV D ZD\ WR GHWHU IXWXUH DUULYDOV 7KH ,PPLJUDWLRQ $FW RI LQFUHDVHG WKH QXPEHU RI DYDLODEOH LPPLJUDQW YLVDV WR IURP WKH SULRU OLPLW RI IRU ILVFDO \HDUV DQG DQG WR WKHUHDIWHU 7KHUHIRUH SURSRVDOV WR FXW LPPLJUDWLRQ E\ RQHWKLUG GLG QRWKLQJ 0F&DUUDQ:DOWHU $FW FK 6WDW 86& i HW VHT DV DPHQGHG WKURXJKRXW 86& 5HIXJHH $FW RI 0DUFK ,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW >Dff$f@ ,PPLJUDWLRQ 5HIRUP DQG &RQWURO $FW 3XE / 6WDW f f7KH V 7KURXJK V ,PPLJUDWLRQ ,VVXHV 5HYLHZ DQG 5HYLVLRQf ZZZIDLUXVRUJ! 0DUFK ,PPLJUDWLRQ 5HIRUP DQG &RQWURO $FW 3XE / 6WDW f 7KH ,PPLJUDWLRQ $FW RI 3XE / 1R ii 6WDW f

PAGE 20

PRUH WKDQ UHHVWDEOLVK WKH LPPLJUDWLRQ OHYHOV RI WKH GHFDGH RI WKH V WKH KLJKHVW HYHU LQ WKH FRXQWU\nV KLVWRU\ XS WR WKDW WLPH ,PPLJUDWLRQ 6WDWLVWLFV ,Q WKH ,PPLJUDWLRQ DQG 1DWXUDOL]DWLRQ 6HUYLFH ,16f UHOHDVHG GHWDLOHG HVWLPDWHV RI WKH XQGRFXPHQWHG LPPLJUDQW SRSXODWLRQ LQ WKH 8QLWHG 6WDWHV DV RI 2FWREHU 7KRVH HVWLPDWHV ZHUH XVHIXO IRU D YDULHW\ RI SXUSRVHV LQFOXGLQJ SODQQLQJ DQG SROLF\ GHYHORSPHQW DW WKH QDWLRQDO DQG VWDWH OHYHO HYDOXDWLQJ WKH HIIHFWV RI SURSRVHG OHJLVODWLRQ DQG DVVHVVLQJ WKH ILVFDO LPSDFW RI XQGRFXPHQWHG LPPLJUDWLRQ %HWZHHQ DQG 2FWREHU WKH ,16 UHYLVHG DQG XSGDWHG WKRVH HVWLPDWHV $V RI 2FWREHU DQ HVWLPDWHG PLOOLRQ XQGRFXPHQWHG LPPLJUDQWV ZHUH UHVLGLQJ LQ WKH 8QLWHG 6WDWHV $Q HVWLPDWHG XQGRFXPHQWHG DOLHQV OLYHG LQ )ORULGD 7KH XQGRFXPHQWHG LPPLJUDQW SRSXODWLRQ ZDV HVWLPDWHG WR EH JURZLQJ E\ DERXW HDFK \HDU ZKLFK ZDV DERXW ORZHU WKDQ WKH DQQXDO OHYHO RI JURZWK HVWLPDWHG E\ WKH ,16 LQ &DOLIRUQLD ZDV WKH OHDGLQJ VWDWH RI UHVLGHQFH ZLWK PLOOLRQ RU SHUFHQW RI WKH XQGRFXPHQWHG SRSXODWLRQ 7KH VHYHQ VWDWHV ZLWK WKH ODUJHVW HVWLPDWHG QXPEHUV RI XQGRFXPHQWHG LPPLJUDQWV LQ LQFOXGLQJ &DOLIRUQLD ZHUH 7H[DV f 1HZ
PAGE 21

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fOHJDOO\ DGPLWWHGf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f 3O\OHU Y 'RH 86 f -RVHSK 3HUNLQV 7KH 6DQ 'LHJR 8QLRQ7ULEXQH -XQH % SJ &RQVWLWXWLRQDO VFKRODUV VDLG WKDW QHLWKHU &RQJUHVV QRU WKH VWDWH OHJLVODWXUHV LQWHQGHG IRU WKH WK $PHQGPHQW WR DSSO\ WR WKH FKLOGUHQ RI XQGRFXPHQWHG LPPLJUDQWV 7KDW ZDV EHFDXVH ZKHQ WKH DPHQGPHQW ZDV RULJLQDOO\ SURSRVHG VRPH \HDUV DJR WKH 8QLWHG 6WDWHV KDG D GHIDFWR fRSHQ ERUGHUf SROLF\ 7KHUH FRXOG EH QR LOOHJDO LPPLJUDWLRQ

PAGE 22

VXFK DV SUHVHUYLQJ WKH JRYHUQPHQWn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fUDWLRQDO MXVWLILFDWLRQ IRU SHQDOL]LQJ WKHVH FKLOGUHQ IRU WKHLU SUHVHQFH ZLWKLQ WKH 8QLWHG 6WDWHV RYHU ZKLFK WKH\ KDG QR FRQWUROf WKH &RXUW VWUXFN GRZQ WKH ODZ $V D UHVXOW RI WKLV GHFLVLRQ SXEOLF VFKRRO GLVWULFWV ZHUH REOLJDWHG WR HGXFDWH LPPLJUDQW FKLOGUHQ UHVLGLQJ ZLWK WKHLU SDUHQWV RU JXDUGLDQV ZLWKLQ D GLVWULFWfV ERXQGDULHV HYHQ LI WKH IDPLOLHV KDG HQWHUHG WKH FRXQWU\ LOOHJDOO\ 3XEOLF VFKRROV KRZHYHU GLG QRW KDYH WR DGPLW QRQUHVLGHQW LPPLJUDQWV WXLWLRQ IUHH ,Q WKH 6XSUHPH &RXUW XSKHOG D VWDWH ODZ DOORZLQJ ORFDO VFKRRO ERDUGV WR GHQ\ WXLWLRQIUHH VFKRROLQJ WR DQ\ PLQRU ZKR OLYHG DSDUW IURP D SDUHQW RU OHJDO JXDUGLDQ IRU WKH SULPDU\ SXUSRVH RI DWWHQGLQJ SXEOLF VFKRRO 7KXV XQOLNH LPPLJUDQW FKLOGUHQ ZKR FDPH WR WKH 86 ZLWK WKHLU SDUHQWV HYHQ LOOHJDOO\f LPPLJUDQW FKLOGUHQ ZKR OHIW WKHLU IDPLOLHV WR OLYH LQ WKH 8QLWHG 6WDWHV IRU HGXFDWLRQDO SXUSRVHV ZHUH QRW HQWLWOHG WR IUHH VFKRROLQJ ,ELG 0DUWLQH] Y %\QXP 86 f

PAGE 23

7DEOH (VWLPDWHG ,OOHJDO ,PPLJUDQW 3RSXODWLRQ IRU 7RS 7ZHQW\ &RXQWULHV RI 2ULJLQ DQG 7RS 7ZHQW\ 6WDWHV RI 5HVLGHQFH 2FWREHU &RXQWU\ RI 2ULJLQ 3RSXODWLRQ 6WDWH 2I 5HVLGHQFH 3RSXODWLRQ $OO FRXQWULHV $OO VWDWHV 0H[LFR &DOLIRUQLD (O 6DOYDGRU 7H[DV *XDWHPDOD 1HZ
PAGE 24

,PPLJUDQW (GXFDWLRQ $Q DGGLWLRQDO 6XSUHPH &RXUW GHFLVLRQ ZLWK LPSOLFDWLRQV IRU LPPLJUDQW FKLOGUHQ ZDV /DX Y 1LFROV UHQGHUHG LQ 7KLV FDVH IRFXVHG RQ WKH ULJKWV RI QRQ(QJOLVK VSHDNLQJ FKLOGUHQ DQG WKH FRUUHVSRQGLQJ GXWLHV RI SXEOLF VFKRROV WR DGGUHVV WKHVH VWXGHQWVn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fD PRFNHU\ RI SXEOLF HGXFDWLRQf (PSKDVL]LQJ WKDW fEDVLF (QJOLVK VNLOO LV DW WKH YHU\ FRUH RI ZKDW WKHVH SXEOLF VFKRROV WHDFKf WKH &RXUW FRQFOXGHG fVWXGHQWV ZKR GR QRW XQGHUVWDQG (QJOLVK DUH HIIHFWLYHO\ IRUHFORVHG IURP DQ\ PHDQLQJIXO HGXFDWLRQf $/DX Y 1LFKROV 86 f &LYLO 5LJKWV $FW RI 3XE / 1R 6WDW 86& i Gf 86 DW VL ,ELG

PAGE 25

7KH IHGHUDO (TXDO (GXFDWLRQDO 2SSRUWXQLWLHV $FW ((2$f RI UHTXLUHG HDFK SXEOLF VFKRRO V\VWHP WR GHYHORS DSSURSULDWH SURJUDPV fWR RYHUFRPH ODQJXDJH EDUULHUV WKDW LPSHGHG HTXDO SDUWLFLSDWLRQ E\ LWV VWXGHQWV LQ LWV LQVWUXFWLRQDO SURJUDPf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f )LJXUH 6FKRRO$JH ,PPLJUDQW 3RSXODWLRQ (TXDO (GXFDWLRQ 2SSRUWXQLWLHV $FW RI ((2$f DW 86& ,8 Q $ f§ 3URMHFWHG &KDQJH ‘ &KLOGUHQ RI 1DWLYHV ‘ &KLOGUHQ RI ,PPLJUDQWV

PAGE 26

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nV 3URSRVLWLRQ ZKLFK UHVWULFWHG JRYHUQPHQW IXQGHG SURJUDPV IURP VHUYLQJ LOOHJDO LPPLJUDQWV SDVVHG LQ E\ D VLJQLILFDQW PDMRULW\ $ IHGHUDO MXGJH IUR]H LPSOHPHQWDWLRQ RI WKH SURYLVLRQ LQ 1RYHPEHU -XGJH 0DULDQD 3IDLO]HU GHFODUHG WKDW LW YLRODWHG ERWK WKH &RQVWLWXWLRQ DQG WKH 3HUVRQDO 5HVSRQVLELOLW\ DQG :RUN 2SSRUWXQLW\ 5HFRQFLOLDWLRQ $FW RI 7KH MXGJH FLWHG DV XQODZIXO WKH LQLWLDWLYHnV PDMRU VHFWLRQVf§WKRVH EDUULQJ XQGRFXPHQWHG LPPLJUDQWV IURP UHFHLYLQJ SXEOLFO\ IXQGHG ,ELG 6DQGUD + )UDGG DQG 2NKHH /HH HGV &UHDWLQJ )ORULGDnV 0XOWLOLQJXDO :RUNIRUFH 0LDPL &XVWRP &RS\ DQG 3ULQWLQJ &DO $SSWK

PAGE 27

HGXFDWLRQ VRFLDO VHUYLFHV DQG KHDOWK FDUHf§DORQJ ZLWK FRPSOHPHQWDU\ SURYLVLRQV PDQGDWLQJ WKDW ORFDO ODZ HQIRUFHPHQW DXWKRULWLHV VFKRRO DGPLQLVWUDWRUV VRFLDO ZRUNHUV DQG KHDOWKFDUH DLGHV WXUQ LQ fVXVSHFWHGf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fGUDVWLF VWHSVf QHHGHG WR EH WDNHQ WR FXUE WKH QXPEHU RI LPPLJUDQWV HQWHULQJ WKH 8QLWHG 6WDWHV 3ROLWLFLDQV H[SUHVVHG WKHLU ZLOOLQJQHVV WR VXSSRUW PHDVXUHV WKDW ZRXOG FORVH WKH ERUGHUV DQG GHQ\ FKLOGUHQ RI XQGRFXPHQWHG ZRUNHUV DQ HGXFDWLRQ $IWHU &DOLIRUQLD YRWHUV SDVVHG 3URSRVLWLRQ RWKHU VWDWHV DWWHPSWHG WR UHVWULFW XQGRFXPHQWHG DOLHQ DFFHVV WR JRYHUQPHQWIXQGHG SURJUDPV f)HGHUDO -XGJH 3URSRVLWLRQ 8QFRQVWLWXWLRQDO 6WDJH 6HW IRU $SSHDO RI $QWLLPPLJUDQW ,QLWLDWLYHf /RV $QJHOHV 7LPHV $ 1RYHPEHU 3O\OHU Y 'RH 86 f &KLQHVH ([FOXVLRQ $FW FK 6WDW IRUPHUO\ FRGLILHG LQ VFDWWHUHG SDUWV RI 86& FKf &DO $SS$r ,ELG

PAGE 28

+LVWRULFDOO\ IHGHUDO DQG VWDWH JRYHUQPHQWV ZRUNHG WR NHHS VWXGHQWV fLQf VFKRRO UDWKHU WKDQ fRXWf %XW DV SDUW RI WKH ZDYH RI DQWLLPPLJUDQW VHQWLPHQW VHYHUDO SURSRVDOV ZHUH PDGH WR EDU XQGRFXPHQWHG LPPLJUDQW VWXGHQWV IURP DWWHQGLQJ SXEOLF VFKRROV &DOLIRUQLDnV YLFWRULRXV EDOORW PHDVXUH 3URSRVLWLRQ EDUUHG XQGRFXPHQWHG VWXGHQWV IURP WKH SXEOLF VFKRROV 7KH *DOOHJO\ $PHQGPHQW f SDVVHG LQ WKH 86 +RXVH RI 5HSUHVHQWDWLYHV DV SDUW RI DQ LPPLJUDWLRQUHIRUP ELOO DQG JDYH VWDWHV WKH DXWKRULW\ WR OLPLW DFFHVV $ SRUWLRQ RI WKH *DOOHJO\ DPHQGPHQW UHDG f&RQJUHVV GHFODUHV LW WR EH WKH SROLF\ RI WKH 8QLWHG 6WDWHV WKDW DOLHQV ZKR DUH QRW ODZIXOO\ SUHVHQW LQ WKH 8QLWHG 6WDWHV QRW EH HQWLWOHG WR SXEOLF HGXFDWLRQ EHQHILWV LQ WKH VDPH PDQQHU DV 8QLWHG 6WDWHV FLWL]HQV DQG ODZIXO UHVLGHQW DOLHQVf 6XSSRUWHUV RI WKH *DOOHJO\ $PHQGPHQW DUJXHG WKDW $PHULFDnV HGXFDWLRQ V\VWHP OLNH RWKHU VRFLDOVHUYLFH SURJUDPV DWWUDFWHG D GLVSURSRUWLRQDWH QXPEHU RI LPPLJUDQWV DQG WKDW WKH FRVW RI HGXFDWLQJ VXFK FKLOGUHQ ZDV WRR KLJK LQ DQ HUD RI WLJKW VFKRRO EXGJHWV 2SSRQHQWV RI WKH PHDVXUH GHQRXQFHG LW DV FUXHO KXQGUHGV RI WKRXVDQGV RI FKLOGUHQ FRXOG SRWHQWLDOO\ EH WXUQHG DZD\ DW WKH VFKRROKRXVH GRRU $EHO &DUPRQD 'LVSHOOLQJ 0\WKV $ERXW ,PPLJUDQW 6WXGHQWV ,5'$ 1HZVOHWWHUr 0D\ ZZZLUGDRUJ1HZVOWWU0D\! ,ELG + 5 f &KDUOHV /HYHQGRVN\ f7KH 3ROLWLFV RI 7XUQLQJ &KLOGUHQ LQWR 9LFWLPVf &DVSHU :YRf 6WDU 7ULEXQH 0D\ ZZZODWLQROLQNFRP! 2FWREHU f,OOHJDO ,PPLJUDQW &KLOGUHQ ,Q RU 2XW RI 3XEOLF 6FKRROV"f (GXFDWLRQ :HHN $SULO ZZZHGZHHNRUJFRQWH[WHOHFWLRQLPPLJKWP! &DUPRQD 'LVSHOOLQJ 0\WKV $ERXW ,PPLJUDQW 6WXGHQWV

PAGE 29

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n QDWLYH ODQJXDJHV 7KH LQLWLDO VWXG\ ZDV GRQH LQ DQG -XOLDQ 6LPRQ ,PPLJUDWLRQ 7KH 'HPRJUDSKLFV DQG (FRQRPLF )DFWV :DVKLQJWRQ '& &DWR ,QVWLWXWH DQG 1DWLRQDO ,PPLJUDWLRQ )RUXP 'DYLG : 6WHZDUW ,PPLJUDWLRQ DQG (GXFDWLRQ 7KH &ULVLV DQG WKH 2SSRUWXQLWLHV 1HZ
PAGE 30

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nV DQG %n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

PAGE 31

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
PAGE 32

7KH 6WDWH RI )ORULGD ZDV XQDEOH WR SURYH WR WKH IHGHUDO JRYHUQPHQW WKDW LOOHJDO LPPLJUDWLRQ LQ )ORULGD KDG D VLJQLILFDQW LPSDFW )ORULGD ZDV IRUFHG WR UHO\ RQ VSHFXODWLRQ RQ VRPH RI LWV ILJXUHV ZKLFK ZHDNHQHG LWV FDVH 7KH EXUGHQ RI SURRI RI DGGLWLRQDO FRVWV GXH WR LOOHJDO LPPLJUDQWV UHPDLQHG ZLWK WKH VWDWH )ORULGDnV HGXFDWLRQ FRVWV IRU ERWK OHJDO DQG LOOHJDO LPPLJUDQWV LQ ZHUH PLOOLRQ ZKLFK ZDV XS SHUFHQW IURP nV H[SHQGLWXUH RI PLOOLRQ 7KH VWDWH VSHQW PLOOLRQ DORQH RQ WKH (QJOLVK IRU 6SHDNHUV RI 2WKHU /DQJXDJHV (62/f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f1HZVf 'DLO\ %UXLQ 0D\ KWWSZZZGDLO\EUXLQXFODHGX! 2FWREHU f f)ORULGD 6RFLDO 3ROLF\ ,VVXHVf ,PPLJUDWLRQ DQG )ORULGD 6RFLDO 3ROLF\ ,VVXHV KWWSZZZIDLUXVRUJ! )HEUXDU\ f ,ELG

PAGE 33

IDPLOLHV WKDQ $PHULFDQV ZKLFK PHDQW PRUH FKLOGUHQ SHU IDPLO\ LQ QHHG RI ELOLQJXDO HGXFDWLRQ DQG VSHFLDO VHUYLFHV $V RI DSSUR[LPDWHO\ SHUFHQW RI DOO IRUHLJQERP SHRSOH UHVLGLQJ LQ WKH 8QLWHG 6WDWHV FDPH WR WKLV FRXQWU\ GXULQJ WKH GHFDGH RI WKH fV $ERXW PLOOLRQ LPPLJUDQWV FDPH GXULQJ WKRVH \HDUV LQFUHDVLQJ WKH 86 SRSXODWLRQ E\ SHUFHQW 7KH FKLOGUHQ RI WKHVH LPPLJUDQWV DERXW PLOOLRQ RI WKHP HQUROOHG LQ VFKRRO LQFUHDVLQJ HQUROOPHQW LQ (QJOLVK DV D 6HFRQG /DQJXDJH FODVVHV E\ SHUFHQW )LYH VWDWHV KDG FDUULHG WKH EXUGHQ RI WKLV ZDYH DFFRUGLQJ WR 5DQG 0RUH WKDQ SHUFHQW RI DOO LPPLJUDQWV OLYHG LQ &DOLIRUQLD 1HZ
PAGE 34

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f7KH 1HW 1DWLRQDO &RVWV RI ,PPLJUDWLRQ LQ -XQH 7KLV ZDV D FRPSUHKHQVLYH QDWLRQZLGH VWXG\ RI WKH ILVFDO LPSDFW RI LPPLJUDWLRQ ,PPLJUDWLRQ 5HIRUP DQG &RQWURO $FW 3XE / 6WDW f 0F'RQQHOO DQG +LOO 5$1' 05$:035,3 ,ELG 5RFR 'HO 6DJUDULR 7RUL] ZZZDDGEHUNHOH\MRXUQDO5RFLR7RUL]KWPO! f)HGHUDO DQG 6WDWH 5HVSRQVLELOLW\ IRU 8QGRFXPHQWHG ,PPLJUDWLRQf %HUNHOH\ 0F1DLU -RXUQDO 7KUHH QR 6XPPHU f ZZZDDGEHUNHOH\HGXMRXPDO!

PAGE 35

RQ WKH VFKRROV DQG SXEOLF EXGJHWV DQG WKH DGPLVVLRQ RI IRUHLJQ VWXGHQWV WR 86 XQLYHUVLWLHV DV D URXWH WR LPPLJUDWLRQ VWDWXV 5HVHDUFK 4XHVWLRQ ,Q RUGHU WR LQYHVWLJDWH WKLV SUREOHP WKH IROORZLQJ TXHVWLRQV ZHUH DGGUHVVHG 'RHV WKH VWDWH RI )ORULGD KDYH D OHJDO HWKLFDO DQG PRUDO REOLJDWLRQ WR HGXFDWH WKH FKLOGUHQ RI XQGRFXPHQWHG LPPLJUDQWV" 'RHV WKH VWDWH UHTXLUH D SROLF\ GLUHFWHG VSHFLILFDOO\ WR WKH HGXFDWLRQ RI WKHVH FKLOGUHQ" :KDW VKRXOG )ORULGDnV SROLF\ EH RQ HGXFDWLQJ WKH FKLOGUHQ RI XQGRFXPHQWHG LPPLJUDQWV" 0HWKRGRORJ\ 7KH WUDGLWLRQDO PHWKRG RI 3ROLF\ $QDO\VLV/HJDO ,QYHVWLJDWLRQ ZDV XWLOL]HG WR LGHQWLI\ MXGLFLDO UHDVRQLQJ UHODWLYH WR HVWDEOLVKHG OHJDO SULQFLSOHV DQG DSSOLFDWLRQV LQ UHOHYDQW FDVHV LQYROYLQJ XQGRFXPHQWHG LPPLJUDQW HGXFDWLRQ 7KH SURFHGXUH LQFOXGHG LGHQWLI\LQJ UHOHYDQW FRQVWLWXWLRQDO DPHQGPHQWV IHGHUDO DFWV VWDWH VWDWXWHV DQG UXOHV DQG UHJXODWLRQV 5HOHYDQW FDVHV ZHUH FRPSLOHG DQG MXGLFLDO UHDVRQLQJ LQ HDFK FDVH ZDV DQDO\]HG 7R DGGUHVV WKH SXUSRVHV RI WKH VWXG\ WKHUH ZDV D QHHG WR GHYHORS VXJJHVWHG VDPSOH SROLF\ LQFOXVLRQV IRU LPSOHPHQWDWLRQ E\ DOO VFKRRO GLVWULFWV ZLWKLQ WKH VWDWH RI )ORULGD 6HYHUDO PHWKRGV RI OHJDO UHVHDUFK ZHUH HPSOR\HG 6SHFLILFDOO\ SROLF\ VWXG\ DQG WUDGLWLRQDO OHJDO UHVHDUFK ZHUH DSSURSULDWH 7R DFFRPSOLVK WKLV WDVN LW ZDV QHFHVVDU\ DQG SUXGHQW WR UHVHDUFK WKH VWDWXV RI FXUUHQW SROLFLHV DV ZHOO DV UHVHDUFK WKH DSSURSULDWH ODZV DQG UXOLQJV f,PPLJUDQWV DQG (GXFDWLRQf LQ )DLU ZZZIDLUXVRUJ! 0D\

PAGE 36

/HJDO UHVHDUFK DV JHQHUDOO\ GHILQHG ZDV D V\VWHPDWLF LQYHVWLJDWLRQ ZKLFK LQYROYHV LQWHUSUHWLQJ DQG H[SODLQLQJ WKH ODZ +LVWRULFDOO\ OHJDO UHVHDUFK KDV UHOLHG RQ SUHFHGHQW 7KH PHWKRGRORJ\ XWLOL]HG LQ WKLV VWXG\ ZDV QRW RQO\ WR UHYLHZ WKH SUHYLRXV DQG FXUUHQW SROLFLHV EXW DOVR WR EXLOG D IRXQGDWLRQ IRU GHVLJQLQJ D PRGHO IRU XQGRFXPHQWHG LPPLJUDQW HGXFDWLRQ SROLF\ IRU WKH VWDWH RI )ORULGD 'HILQLWLRQ 2I 7HUPV f 8QGRFXPHQWHG LPPLJUDQW GHVLJQDWHV SHUVRQV ZKR DUH FRUUHVSRQGLQJO\ UHIHUUHG WR DV fLOOHJDO LPPLJUDQWVf RU fLOOHJDO DOLHQVf &RQJUHVVLRQDO 5HVHDUFK 6HUYLFH GHILQHV LOOHJDO DOLHQV DV SHUVRQV ZKR KDYH YLRODWHG LPPLJUDWLRQ ODZ f )XQGDPHQWDO 5LJKWV WKRVH ULJKWV H[SOLFLWO\ RU LPSOLFLWO\ SURYLGHG E\ WKH IHGHUDO FRQVWLWXWLRQ VXFK DV WKH ULJKW WR H[HUFLVH )LUVW $PHQGPHQW IUHHGRPV 7KH FRXUWV KDYH IRXQG WKDW HGXFDWLRQ LV D QRW IXQGDPHQWDO ULJKW f 3URFHGXUDO GXH SURFHVV JXDUDQWHHV SURFHGXUDO IDLUQHVV ZKHUH D SHUVRQfV SURSHUW\ RU OLEHUW\ LV GHSULYHG E\ WKH JRYHUQPHQW f 6XVSHFW &ODVVLILFDWLRQ fGHVHUYLQJ RI VSHFLDO VFUXWLQ\f LQFOXGH WKRVH EDVHG RQ UDFH QDWLRQDO RULJLQ UHOLJLRQ DOLHQDJH QRQUHVLGHQF\f f 8QGRFXPHQWHG DOLHQV SHUVRQV ZKR DUH LQ WKH 8QLWHG 6WDWHV LQ YLRODWLRQ RI WKH ,PPLJUDWLRQ DQG 1DWXUDOL]DWLRQ $FW 7KH\ HLWKHU HQWHUHG WKLV FRXQWU\ LOOHJDOO\ RU HQWHUHG OHJDOO\ WKHQ YLRODWHG FRQGLWLRQV RI HQWU\ f 8QGRFXPHQWHG DOLHQ FKLOGUHQ FKLOGUHQ ZKR OLYH ZLWK WKHLU SDUHQWV ZKR DUH UHVLGLQJ LQ WKH 8QLWHG 6WDWHV LOOHJDOO\ FKLOGUHQ ZKRVH SDUHQWV UHVLGH LQ DQRWKHU FRXQWU\ DQG WKH FKLOGUHQ DUH UHVLGLQJ LQ WKH 8QLWHG 6WDWHV ZLWK VRPHRQH ZKR LV QRW WKHLU fSDUHQW JXDUGLDQ RU SHUVRQ KDYLQJ ODZIXO FRQWUROf IRU WKH VROH SXUSRVH RI DWWHQGLQJ IUHH SXEOLF VFKRRO f 1HZFRPHU D UHFHQW LPPLJUDQW HLWKHU OHJDO RU LOOHJDO &KDUOHV 5XVVR /HJDO 5HVHDUFK 7KH n7UDGLWLRQDO 0HWKRG 12/3( 1RWHV 2FWREHU f

PAGE 37

/LPLWDWLRQV 7KLV VWXG\ SURYLGHV DQ DQDO\VLV RI SUHYLRXV VWDWXWHV FRXUW FDVHV VFKRRO ERDUG SROLFLHV DQG DWWRUQH\ JHQHUDO RSLQLRQV UHODWHG WR WKH HGXFDWLRQ RI XQGRFXPHQWHG DOLHQ FKLOGUHQ $V WKH PHPEHUV RI WKH FRXUWV FKDQJH FKDQJHV FRXOG GHYHORS LQ WKH OHJDO EDVHV SURYLGLQJ WKH IRXQGDWLRQ IRU WKLV VWXG\ )XUWKHU OLPLWDWLRQV DUH OLVWHG EHORZ f ,W LV XQODZIXO WR DVN IRU SURRI RI OHJDO VWDWXV IURP D VWXGHQW f 'LVFXVVLRQ RI HGXFDWLRQ H[SHQGLWXUHV LQFOXGH EXW QRW SRVWVHFRQGDU\ f 'DWD DYDLODEOH DUH HVWLPDWHV IURP WKH WRWDO SRSXODWLRQ f 0RVW UHFHQW &HQVXV GDWD LV IRU ZLWK HVWLPDWHV IRU f f 7KH WUDQVLHQW QDWXUH RI WKH WDUJHW SRSXODWLRQ f /RFDO JRYHUQPHQWV GR QRW GRFXPHQW 86 UHVLGHQF\ VWDWXV RI ORFDO VHUYLFH FRQVXPHUV LQ SDUW EHFDXVH ORFDO UHVLGHQF\ LV D UHTXLUHPHQW IRU ORFDO VHUYLFH HOLJLELOLW\ 86 UHVLGHQF\ VWDWXV LV QRW D SURJUDP HOLJLELOLW\ UHTXLUHPHQW f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

PAGE 38

WKH\ UHTXLUH 'DWD ZHUH UHWULHYHG IURP WKH ,QWHUQHW DQGRU SXEOLF GRFXPHQWV DQG SXEOLFDWLRQV f 7KH VWXG\ H[DPLQHG KLVWRULFDO FRQVWLWXWLRQDO LVVXHV LQYROYHG LQ HGXFDWLQJ XQGRFXPHQWHG DOLHQ FKLOGUHQ LQ RUGHU WR GHPRQVWUDWH SUHYLRXV SROLF\ f 7KH VWXG\ DQDO\]HG WKH 8QLWHG 6WDWHV 6XSUHPH &RXUW UXOLQJ LQ 3O\OHU Y 'RH f LQ RUGHU WR XQGHUVWDQG WKH FXUUHQW SDUDGLJP f 7KH VWXG\ H[DPLQHG &DOLIRUQLDnV 3URSRVLWLRQ DQG LWV LPSOLFDWLRQV IRU OHJLVODWLYH SROLF\ IRU WKH VWDWH RI )ORULGD f 7KH VWXG\ ORRNHG DW VRPH RI WKH HWKLFDO DQG PRUDO FRQVLGHUDWLRQV RI HGXFDWLQJ XQGRFXPHQWHG DOLHQ FKLOGUHQ LQ RUGHU WR GHWHUPLQH WKH REOLJDWLRQV RI WKH VWDWH RI )ORULGD f 7KH VWXG\ VXJJHVWHG D IHDVLEOH SROLF\ RQ XQGRFXPHQWHG LPPLJUDQW HGXFDWLRQ IRU WKH VWDWH RI )ORULGD 2UJDQL]DWLRQ RI WKH &KDSWHUV &KDSWHU SURYLGHV LQWURGXFWRU\ LQIRUPDWLRQ D VWDWHPHQW RI WKH SUREOHP DQG WKH VLJQLILFDQFH PHWKRGRORJ\ OLPLWDWLRQV DQG GHVLJQ RI WKH VWXG\ 7KH UHPDLQGHU RI WKLV VWXG\ LV RUJDQL]HG LQ WKH IROORZLQJ PDQQHU &KDSWHU SUHVHQWV DQ KLVWRULFDO UHYLHZ RI LPPLJUDWLRQ OHJLVODWLRQ WKURXJK &KDSWHU FRQWLQXHV ZLWK WKH KLVWRULFDO UHYLHZ DQG ORRNV DW VRPH LOOHJDO LPPLJUDWLRQ VWDWLVWLFV IRU WKH 8QLWHG 6WDWHV DQG WKH VWDWH RI )ORULGD &KDSWHU SUHVHQWV VRPH ILQDQFLDO DQG HWKLFDO LVVXHV UHODWHG WR WKH HGXFDWLRQ RI XQGRFXPHQWHG LPPLJUDQW FKLOGUHQ 8VLQJ VRPH KLVWRULFDO LQIRUPDWLRQ LW DOVR SXWV IRUZDUG WKH TXHVWLRQ RI ZKDW ZRXOG WKH SROLWLFDO DWPRVSKHUH UHJDUGLQJ WKH HGXFDWLRQ RI LPPLJUDQW FKLOGUHQ ZRXOG EH OLNH LI WKH 3O\OHU GHFLVLRQ KDG EHHQ GLIIHUHQW &KDSWHU VXJJHVWV LQFOXVLRQV IRU D SUDFWLFDO LPPLJUDQW HGXFDWLRQ SROLF\ IRU WKH VWDWH RI )ORULGD LQFOXGLQJ WKH XQGRFXPHQWHG LPPLJUDQW VWXGHQW

PAGE 39

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

PAGE 40

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f 7KH &RQJUHVVLRQDO 3ROLWLFV RI ,PPLJUDWLRQ 5HIRUP %RVWRQ $OO\Q DQG %DFRQ ,ELG 7KH /LQFROQ /LEUDU\ RI (VVHQWLDO ,QIRUPDWLRQ WK HG VY f,PPLJUDWLRQf )URQWLHU 3UHVV &ROXPEXV 2KLR f

PAGE 41

WKH RULJLQDO VHWWOHUV RI WKH 8QLWHG 6WDWHV $IWHU WKDW GDWH LPPLJUDWLRQ IURP QRUWKHUQ (XURSH GHFOLQHG ZKLOH WKDW IURP VRXWKHUQ (XURSH DQG IURP 5XVVLD UDSLGO\ LQFUHDVHG 7KLV VRFDOOHG fQHZ LPPLJUDWLRQf SURGXFHG D FKDQJH LQ WKH $PHULFDQ DWWLWXGH WRZDUG XQOLPLWHG LPPLJUDWLRQ 8QWLO :RUOG :DU WKH LPPLJUDWLRQ ODZV ZHUH GHVLJQHG RQO\ WR H[FOXGH FHUWDLQ XQGHVLUDEOH FDWHJRULHV LQFOXGLQJ WKH IHHEOHPLQGHG LQVDQH HSLOHSWLFV VXIIHUHUV IURP FHUWDLQ FRQWDJLRXV GLVHDVHV SDXSHUV FULPLQDOV SURVWLWXWHV SRO\JDPLVWV DQDUFKLVWV DQG WKRVH FRQYLFWHG RI RU DGPLWWLQJ WR FULPHV RU PLVGHPHDQRUV fLQYROYLQJ PRUDO WXUSLWXGHf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f§WKH VRFDOOHG fJHQWOHPHQfV ,ELG &KLQHVH ([FOXVLRQ $FW FK 6WDW 7KH /LQFROQ /LEUDU\ RI (VVHQWLDO ,QIRUPDWLRQ

PAGE 42

DJUHHPHQWff§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f ,PPLJUDWLRQ $FW RI 3XE / 1R 6WDW FRGLILHG DV DPHQGHG DW 86& i f ,ELG *UHJJ 9DQ 'H 0DUN f7RR 0XFK RI D *RRG 7KLQJf :DVKEXUQ /DZ -RXUQDO QR 6SULQJ f KWWSZDVKEXPODZZXDFFHGXVFKRROSXEOLFWQVZOM!

PAGE 43

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f WR VWXG\ WKH JURZLQJ LPPLJUDWLRQ FRQFHUQV RI WKH JHQHUDO SXEOLF 7KH PDLQ FRQFHUQV RI WKRVH SXVKLQJ IRU LPPLJUDWLRQ FRQWUROV ZHUH WKH DVVLPLODELOLW\ RI WKH QHZ LPPLJUDQWV WKHLU VKHHU QXPEHUV DQG WKHLU HIIHFW RQ WKH QDWLRQfV SROLWLFV ODQJXDJH DQG FXOWXUH 7KH FRPPLVVLRQfV LQYHVWLJDWLRQf§WKH PRVW H[KDXVWLYH VWXG\ RI LPPLJUDWLRQ LQ $PHULFDQ KLVWRU\f§RULJLQDWHG LQ UHVSRQVH WR FDOOV WR FXUWDLO LPPLJUDWLRQ IURP -DSDQ DQG VRXWKHUQ DQG HDVWHUQ (XURSH ,Q WKH 'LOOLQJKDP &RPPLVVLRQ HYHQWXDOO\ UHFRPPHQGHG UHVWULFWLYH FKDQJHV WR $PHULFDfV LPPLJUDWLRQ ODZV /DZUHQFH %URZQ f,PPLJUDWLRQ &XOWXUDO &RQIOLFWV DQG 6RFLDO $GMXVWPHQWVf f 9DLO f1R (QWU\f SS &KLQHVH ([FOXVLRQ $FW FK 6WDW 86 &RQVWLWXWLRQV $UW 9, FO 7KRPDV $ $OHLQLNRII DQG 'DYLG 0DUWLQ ,PPLJUDWLRQ 3URFHVV DQG 3ROLF\ LQWHULP G HG f ,ELG

PAGE 44

,PPLJUDWLRQ 3ROLF\ $IWHU &RQJUHVV ILQDOO\ UHVSRQGHG WR WKH 'LOOLQJKDP &RPPLVVLRQfV UHFRPPHQGDWLRQV WHQ \HDUV ODWHU E\ SDVVLQJ WKH 4XRWD $FW RQ 0D\ 7KH $FW FUHDWHG D 1DWLRQDO 2ULJLQV SODQ XQGHU ZKLFK HDFK FRXQWU\ KDG DQ LPPLJUDQW TXRWD LQ SURSRUWLRQ WR WKDW QDWLRQf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f E\ GLOXWLQJ WKH DELOLW\ RI FXUUHQW UHVLGHQWV WR GHWHUPLQH WKH QDWLRQfV GHVWLQ\ 7KH $FW PDLQWDLQHG WKH H[HPSWLRQ IURP TXRWDV IRU WKH LQGHSHQGHQW FRXQWULHV RI WKH :HVWHUQ +HPLVSKHUH 7KH :HVWHUQ +HPLVSKHUH H[FHSWLRQ UHVXOWHG IURP D FRPELQDWLRQ RI WKH HFRQRPLF LQWHUHVWV RI VRXWKZHVWHUQ UDQFKHUV DQG IDUPHUV DQG D SROLF\ RI 3DQ $PHULFDQLVP WKDW HPSKDVL]HG VROLGDULW\ DJDLQVW WKH SUREOHPV RI (XURSH 7KXV WKH 4XRWD $FW FK 6WDW f ,ELG f,ELG 7KH ,PPLJUDWLRQ $FW RI FK 6WDW f %HQMDPLQ 0 =LHJOHU HG ,PPLJUDWLRQ $Q $PHULFDQ 'LOHPPD f 0DULRQ 7 %HQQHWW $PHULFDQ ,PPLJUDWLRQ 3ROLFLHV $ +LVWRU\ f

PAGE 45

Vf OHJLVODWLRQ VRXJKW WR SUHVHUYH WKH (XURSHDQ KHULWDJH DV LW KDG GHYHORSHG LQ WKH 8QLWHG 6WDWHV ZLWKRXW LGHQWLI\LQJ RXU QDWLRQ ZLWK PRGHP (XURSH 7KH FHQVXV VHUYHG DV D WHPSRUDU\ SURYLVLRQ XQWLO &RQJUHVV HVWDEOLVKHG WKH ILQDO QDWLRQDO RULJLQV V\VWHP LQ 7KHUHDIWHU &RQJUHVV VHW WKH QDWLRQDO RULJLQV TXRWD DW RQHVL[WK RI RQH SHUFHQW RI WKH SRSXODWLRQ WR DUULYH DW D EDVH ILJXUH RI 7KH Vf OHJLVODWLRQ HIIHFWLYHO\ VWRSSHG ODUJHVFDOH LPPLJUDWLRQ WR WKH 8QLWHG 6WDWHV IRU IRUW\ \HDUV $ JUHDW UHGXFWLRQ LQ fDQWLLPPLJUDQW K\VWHULDf IROORZHG WKH Vf OHJLVODWLRQ
PAGE 46

1RW XQWLO WKH V DQG V WKH YHU\ ORZHVW SHULRG RI WK FHQWXU\ LPPLJUDWLRQf§DQG WKH EHJLQQLQJ RI PRGHP $PHULFDQ FRQILGHQFH LQ DVVLPLODWLRQf GLG WKH 6WDWXH RI /LEHUW\ EHJLQ WR UHSUHVHQW WKH LPPLJUDQW LQ WKH H\HV RI PRVW $PHULFDQV 7KH PHFKDQLFV RI DVVLPLODWLRQ ZHUH YHU\ FRPSOLFDWHG EXW LQFOXGHG VXFK IDFWRUV DV SROLWLFDO SDUWLFLSDWLRQ HFRQRPLF DQG HPSOR\PHQW PDUNHWV HGXFDWLRQ UHVLGHQWLDO SDWWHUQV f A L HFRQRPLF FODVV DQG HYHQ IDFWRUV VXFK DV OHLVXUH WLPH DFWLYLWLHV 7KH UHODWLRQVKLS EHWZHHQ WKH Vf OHJLVODWLRQ DQG DVVLPLODWLRQ ZDV QHFHVVDU\ EHFDXVH UHGXFHG HWKQLF FRQIOLFW DQG HPHUJHQW $PHULFDQ FRPPRQDOLW\ OHG GLUHFWO\ WR WKH WKHPH RI FRQILGHQFH LQ WKH $PHULFDQ DVVLPLODWLYH FDSDFLW\ ZKLFK WKH 8QLWHG 6WDWHV 6XSUHPH &RXUW LQ 3O\OHU WRRN IRU JUDQWHG 7KH WHUP fIDPLO\ G\QDPLFf ZDV XVHG WR K\SRWKHVL]H WKDW WKH FKLOGUHQ RI LQWHUPDUULDJH KHOS FUHDWHG D fQHZf FXOWXUH E\ DVVLPLODWLQJ WKH WUDLWV RI WKHLU SDUHQWV DQG UHODWLYHV ZLWK WKH ODUJHU FXOWXUH WR ZKLFK WKH\ ZHUH H[SRVHG $Q LPSRUWDQW SDUW RI WKLV WKHRU\ ZDV WKDW SHRSOH ZKR GLG QRW LQWHUPDUU\ IDFHG SUHVVXUH WR H[KLELW KHLJKWHQHG WROHUDQFH DQG VHQVLWLYLW\ WRZDUG FKLOGUHQ RI WKRVH UHODWLYHV ZKR GLG LQWHUPDUU\ )RUHLJQ ERP LPPLJUDQWV DQG fQDWLYHVff KDG VLJQLILFDQW DQG VWURQJ SUHMXGLFHV 7KHLU FKLOGUHQ KDG OHVV 7KH IDPLO\ G\QDPLF SURGXFHG YDULRXV FRPSURPLVHV IURP ZKLFK fDFFHSWDEOHf VRFLDO GHYLDWLRQ FRXOG EH MXGJHG 7KLV HIIHFW DFFRXQWHG IRU WKH IDFW WKDW IRRG GDQFH VRPH ODQJXDJH ZRUN KDELWV OHLVXUH DFWLYLWLHV KROLGD\V HWF WHQGHG WR EH UHWDLQHG ORQJHU ,ELG .HQQHWK / .DUVW 3DWKV WR %HORQJLQJ 7KH &RQVWLWXWLRQ DQG &XOWXUDO ,GHQWLW\ 1&/ 5(9 f TXRWHG LQ 9DQ 'H 0DUN

PAGE 47

ZLWK WKH IDPLO\ DQG RIWHQ DGRSWHG WKURXJKRXW VRFLHW\f ZKLOH ULJLG SUHMXGLFHV WHQGHG WR EH GLVFDUGHG DV fWURXEOHVRPHf &XVWRPV WKDW RIIHQGHG UHODWLYHV fRQ WKH RWKHU VLGHf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f$PHULFDQL]DWLRQf PRYHPHQW LQ HGXFDWLRQ 3URSRQHQWV RI WKH $PHULFDQL]DWLRQ PRYHPHQW RIWHQ RYHUORRNHG PLQRULW\ DFFRPSOLVKPHQWV DQG JORVVHG RYHU PDMRULW\ DEXVHV LQ WKHLU SXVK WR 3O\OHU 86 DW f %HUQDUG %DLO\Q (GXFDWLRQ LQ WKH )RUPLQJ RI $PHULFDQ 6RFLHW\ f TXRWHG LQ 9DQ 'H 0DUN ,ELG $UWKXU 0 6FKOHVVLQJHU -U 7KH 'LVXQLWLQJ RI $PHULFD S f

PAGE 48

GHYHORS D FRPPRQ VRFLDO QXFOHXV (GXFDWLRQ KHOSHG IRUP QHZ VRFLDO SDWWHUQV E\ SURYLGLQJ DFFHVV WR PLGGOH FODVV SURIHVVLRQV DQG E\ HDVLQJ VRFLDO EDUULHUV WR WKH H[WHQW WKDW LQWHUPDUULDJH ZDV FRPPRQ DPRQJ PLGGOH FODVV \RXQJ SHRSOH 7KH IRUW\\HDU EUHDN LQ LPPLJUDWLRQ SURWHFWHG VXSSRUWHG DQG GHYHORSHG D VKLIWLQJ DQG HYROYLQJ fFRPPRQf FXOWXUH DQG VLPXOWDQHRXVO\ DQFKRUHG WKH FRUH YDOXHV QHFHVVDU\ WR PDLQWDLQ D ZRUNDEOH VRFLHW\ 7KH REMHFWLRQDEOH UDFLVW DQG HXJHQLF DSSHDUDQFH RI WKH Vf OHJLVODWLRQ VKRXOG QRW EOLQG XV WR WKH SRVLWLYH UHVXOWV RI D IRUW\ \HDU LPPLJUDWLRQ OXOO :KDWHYHU WKH GUDIWHUV RI WKH Vf OHJLVODWLRQ LQWHQGHG LW UHGXFHG VRFLDO WHQVLRQV DQG VXVWDLQHG WKH DVVLPLODWLYH UHODWLRQVKLS EHWZHHQ LQWHUPDUULDJH DQG FRUH YDOXHV 7KH ,PPLJUDWLRQ $FW ,Q WKH 0F&DUUDQ:DOWHU $FW EDVLFDOO\ DOWHUHG WKH LPPLJUDWLRQ SROLF\ RI WKH 8QLWHG 6WDWHV 7KH ,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW RIILFLDO QDPHf UHWDLQHG WKH TXRWD EDVH ,W UHPRYHG UDFLDO ELDV IURP WKH VHWWLQJ RI QDWLRQDO RULJLQV TXRWDV VLQFH SDUWLFXODU LPPLJUDQWV FRXOG QRW EH H[FOXGHG RQ DFFRXQW RI UDFH 7KH $FW DOVR f UHDIILUPHG WKH QDWLRQDO RULJLQV TXRWD V\VWHP f OLPLWHG LPPLJUDWLRQ IURP WKH (DVWHUQ +HPLVSKHUH ZKLOH OHDYLQJ WKH :HVWHUQ +HPLVSKHUH XQUHVWULFWHG f HVWDEOLVKHG SUHIHUHQFHV IRU VNLOOHG ZRUNHUV DQG UHODWLYHV RI 86 FLWL]HQV DQG SHUPDQHQW UHVLGHQW ,ELG S .DUVW DV TXRWHG LQ 9DQ GH 0DUN S $OHLQLNRII 7KH 7LJKWHQLQJ &LUFOH S 0F&DUUDQ:DOWHU $FW FK 6WDW 86& i HW VHT DV DPHQGHG WKURXJKRXW 86& ,ELG

PAGE 49

DOLHQV DQG f WLJKWHQHG VHFXULW\ DQG VFUHHQLQJ VWDQGDUGV DQG SURFHGXUHV 3UHVLGHQW 7UXPDQ YHWRHG WKH $FW EHFDXVH LW GLG QRW JR IDU HQRXJK LQ UHPRYLQJ UDFLDO ELDV IURP WKH LPPLJUDWLRQ SURFHVV &RQJUHVV WKHQ RYHUURGH 7UXPDQnV YHWR E\ D ZLGH PDUJLQ ,Q UHVSRQVH 3UHVLGHQW 7UXPDQ DSSRLQWHG D FRPPLVVLRQ WR VWXG\ LPPLJUDWLRQ DIWHU &RQJUHVV HQDFWHG WKH 0F&DUUDQ:DOWHU $FW 7KH &RPPLVVLRQf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f7KLV QDWLRQ LV WKH ODVW KRSH RI :HVWHUQ &LYLOL]DWLRQ DQG LI WKLV RDVLV RI WKH ZRUOG VKDOO EH RYHUUXQ SHUYHUWHG FRQWDPLQDWHG RU GHVWUR\HG WKHQ WKH ODVW IOLFNHULQJ OLJKW RI KXPDQLW\ ZLOO EH H[WLQJXLVKHGf 0F&DUUDQ WUXO\ ZLVKHG WR HQG UDFLDO GLVFULPLQDWLRQ LQ LPPLJUDWLRQ DGPLVVLRQV EXW KH IHOW WKDW WKH 8QLWHG 6WDWHV FRXOG EHVW VHUYH LWV PLVVLRQ LQ WKH ZRUOG E\ O=LHJOHU $Q $PHULFDQ 'LOHPPD SS ,ELG S ,ELG SS ,ELG &RQJUHVVLRQDO 5HFRUG SW S f

PAGE 50

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f ,PPLJUDWLRQ $FW RI 3XE / 1R 6WDW ,ELG 1DWKDQ *OD]HU HG &ODPRU $W 7KH *DWHV 7KH 1HZ $PHULFDQ ,PPLJUDWLRQ &,&6 3UHVV SS f

PAGE 51

VRPH FRQGHVFHQVLRQ WKDW SRSXODWLRQ SUHVVXUHV LQ ZKDW LV QRZ WHUPHG WKH 7KLUG :RUOG ZRXOG QRW HQFRXUDJH HPLJUDWLRQ KH FRXOG QRW KDYH EHHQ PRUH ZURQJ &RQJUHVV GHVLJQHG WKH $FW WR SURYLGH D OHYHO SOD\LQJ ILHOG DPRQJ HPLJUDQWn VHQGLQJ QDWLRQV ZLWKRXW FRQFHQWUDWLQJ RQ DQ\ RQH UHJLRQ 7KH $FW ZDV QRW GHVLJQHG WR WUDQVIRUP WKH FXOWXUH RU WKH GHPRJUDSKLF FKDUDFWHU RI WKH 8QLWHG 6WDWHV KHUHLQDIWHU 6WDWLVWLFDO
PAGE 52

$PHULFDQV ZDV QRQZKLWH $FFRUGLQJ WR WKH FHQVXV RQH RXW RI IRXU $PHULFDQV FODLPV WR EH QRQZKLWH 7KH 8QLWHG 6WDWHV QR ORQJHU FRQVLVWV RI DQ RYHUZKHOPLQJ ZKLWH PDMRULW\ ZLWK VLJQLILFDQW PLQRULWLHV RI EODFNV DQG WR D OHVVHU DQG PRUH ORFDOL]HG GHJUHH +LVSDQLFV $PHULFDQ ,QGLDQV DQG $VLDQV ,PPLJUDWLRQ 3ROLF\ $IWHU &RQJUHVV PDGH VHYHUDO VXEVWDQWLYH FKDQJHV WR LPPLJUDWLRQ SROLF\ DIWHU 7KH ,PPLJUDWLRQ 5HIRUP DQG &RQWURO $FW RI ,5&$f JUDQWHG DPQHVW\ WR FHUWDLQ LOOHJDO LPPLJUDQWV DQG PDQGDWHG HPSOR\HU VDQFWLRQV IRU WKRVH KLULQJ LOOHJDO LPPLJUDQWV DV D ZD\ WR GHWHU IXWXUH DUULYDOV 7KH ,PPLJUDWLRQ $FW RI LQFUHDVHG WKH QXPEHU RI DYDLODEOH LPPLJUDQW YLVDV WR IURP WKH SULRU OLPLW RI IRU ILVFDO \HDUV DQG DQG WR WKHUHDIWHU 7KHUHIRUH SURSRVDOV WR FXW LPPLJUDWLRQ E\ RQHWKLUG GLG QRWKLQJ PRUH WKDQ UHHVWDEOLVK WKH LPPLJUDWLRQ OHYHOV RI WKH V WKH KLJKHVW HYHU LQ WKH FRXQWU\nV KLVWRU\ XS WR WKDW WLPH ,PPLJUDQWV DUULYHG WKURXJK D FRPSOLFDWHG V\VWHP FRPSULVHG RI OHJDO LPPLJUDWLRQ IDPLO\EDVHG LPPLJUDWLRQ VNLOOVEDVHG LPPLJUDWLRQ QDWLRQDOLW\EDVHG YLVDV UHIXJHHV DQG DV\OXP VHHNHUV PLVFHOODQHRXV LPPLJUDWLRQ DQG LOOHJDO LPPLJUDWLRQ 7KLUG :RUOG %XUHDX 2I 7KH &HQVXV 86 'HSDUWPHQW 2I &RPPHUFH &HQVXV 2I 3RSXODWLRQ &KDUDFWHULVWLFV 2I 7KH 3RSXODWLRQ SW DW WEO f ,ELG ,PPLJUDWLRQ 5HIRUP DQG &RQWURO $FW 3XE / 1R 6WDW f 7KH ,PPLJUDWLRQ $FW RI 3XE / 1R ii 6WDW f %ULPHORZ $OLHQ 1DWLRQ SS (VWLPDWHV UDQJHG IURP WR SHU \HDU

PAGE 53

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

PAGE 54

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f$PHULFDQff WR EH WKHLU RIILFLDO ODQJXDJH 7KH GHFLVLRQ LQ 0H\HU JDYH HGXFDWRUV WKH ULJKW WR XVH D ODQJXDJH RWKHU WKDQ (QJOLVK LQ WKH FODVVURRP 7KH 5HIXJHH $FW RI SURYLGHG IXQGLQJ IRU VXFK SURJUDPV DV (QJOLVK IRU 6SHDNHUV RI 2WKHU /DQJXDJHV (62/ RU (6/f 7KLV SURJUDP DOORZHG LPPLJUDQW VWXGHQWV WR EH WDXJKW LQ WKHLU QDWLYH ODQJXDJH DW D SXEOLF VFKRRO 7KH &RQVHQW 'HFUHH RI PDQGDWHG VXUYH\LQJ LPPLJUDQW VWXGHQWV WR GHWHUPLQH WKHLU OHYHO RI QHHG IRU ODQJXDJH 0H\HU Y 1HEUDVND 86 f (OOLV &RVH $ 1DWLRQ RI 6WUDQJHUV 3UHMXGLFH 3ROLWLFV DQG WKH 3RSXODWLQJ RI $PHULFD 1HZ Dff$f@ )ORULGD 'HSDUWPHQW RI (GXFDWLRQ Df /HDJXH RI 8QLWHG /DWLQ $PHULFDQ &LWL]HQV /8/$&f HW DO Y 6WDWH %RDUG RI (GXFDWLRQ &RQVHQW 'HFUHH 7DOODKDVVHH )/ 2IILFH RI 0XOWLFXOWXUDO 6WXGHQW /DQJXDJH (GXFDWLRQ

PAGE 55

VHUYLFHV LQ RUGHU WR OHDUQ (QJOLVK DQG WR SURYLGH WKRVH VHUYLFHV DV SDUW RI WKH HGXFDWLRQ SURJUDP ,PPLJUDWLRQ SROLF\ XS WR GLG QRW DGGUHVV WKH DVSHFW RI HGXFDWLQJ WKH FKLOGUHQ RI LPPLJUDQWV OHJDO RU LOOHJDO (DFK VWDWH KDG WKHLU RZQ ODZV RU QRQHf UHJDUGLQJ WKH HGXFDWLRQ RI LPPLJUDQWV DQG RWKHU fVXVSHFWf FODVVHV 7KH HGXFDWLRQ RI LOOHJDO LPPLJUDQW FKLOGUHQ GLG QRW EHFRPH DQ LVVXH XQWLO WKH GHFDGH RI WKH V LQ 7H[DV DQG WKHQ LW EHFDPH D SUREOHP 3O\OHU Y 'RH UHSUHVHQWHG WKH HSLWRPH RI FRQILGHQFH LQ $PHULFDfV DVVLPLODWLYH FDSDFLW\ 7KH 8QLWHG 6WDWHV 6XSUHPH &RXUW KHOG WKDW VWDWHV FRXOG QRW GHQ\ D IUHH SXEOLF HGXFDWLRQ WR WKH IRUHLJQ ERP FKLOGUHQ RI LOOHJDO LPPLJUDQWV ,Q 3O\OHU WKH &RXUW FRQVLGHUHG WKH 7H[DV VWDWXWH SURKLELWLQJ VWDWHIXQGHG SXEOLF HGXFDWLRQ WR FKLOGUHQ RI LOOHJDO DOLHQV -DPHV 3O\OHU ZDV WKH 6XSHULQWHQGHQW RI WKH 7\OHU ,QGHSHQGHQW 6FKRRO 3O\OHU 86 DW f ,ELG S 7(;$6 ('8&$7,21 &2'( $11 i 9HUQRQ 6XSS f FLWHG LQ 3O\OHU 86 DW QO Df $OO FKLOGUHQ ZKR DUH FLWL]HQV RI WKH 8QLWHG 6WDWHV RU OHJDOO\ DGPLWWHG DOLHQV DQG ZKR DUH RYHU WKH DJH RI ILYH \HDUV DQG XQGHU WKH DJH RI \HDUV RQ WKH ILUVW GD\ RI 6HSWHPEHU RI DQ\ VFKRODVWLF \HDU VKDOO EH HQWLWOHG WR WKH EHQHILWV RI WKH $YDLODEOH 6FKRRO )XQG IRU WKDW \HDU Ef (YHU\ FKLOG LQ WKLV VWDWH ZKR LV D FLWL]HQ RI WKH 8QLWHG 6WDWHV RU D OHJDOO\ DGPLWWHG DOLHQ DQG ZKR LV RYHU WKH DJH RI ILYH \HDUV DQG QRW RYHU WKH DJH RI \HDUV RQ WKH ILUVW GD\ RI 6HSWHPEHU RI WKH \HDU LQ ZKLFK DGPLVVLRQ LV VRXJKW VKDOO EH SHUPLWWHG WR DWWHQG WKH SXEOLF IUHH VFKRROV RI WKH GLVWULFW LQ ZKLFK KH UHVLGHV RU LQ ZKLFK KLV SDUHQW JXDUGLDQ RU WKH SHUVRQ KDYLQJ ODZIXO FRQWURO RI KLP UHVLGHV DW WKH WLPH KH DSSOLHV IRU DGPLVVLRQ Ff 7KH ERDUG RI WUXVWHHV RI DQ\ SXEOLF IUHH VFKRRO GLVWULFW RI WKLV VWDWH VKDOO DGPLW LQWR WKH SXEOLF IUHH VFKRROV RI WKH GLVWULFW IUHH RI WXLWLRQ DOO SHUVRQV ZKR DUH HLWKHU FLWL]HQV RI WKH 8QLWHG 6WDWHV RU OHJDOO\ DGPLWWHG DOLHQV DQG ZKR DUH RYHU ILYH DQG QRW RYHU \HDUV RI DJH DW WKH EHJLQQLQJ RI WKH VFKRODVWLF \HDU LI VXFK SHUVRQV RU KLV SDUHQW JXDUGLDQ RU SHUVRQ KDYLQJ ODZIXO FRQWURO UHVLGHV ZLWKLQ WKH VFKRRO GLVWULFW

PAGE 56

'LVWULFW ZKLFK ZDV QDPHG LQ WKH FDVH E\ fFHUWDLQ QDPHG DQG XQQDPHG XQGRFXPHQWHG DOLHQ FKLOGUHQf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f WKH LOOHJDO DOLHQV ZKR ZHUH WKH SODLQWLIIV FRXOG FODLP WKH EHQHILW RI WKH HTXDO SURWHFWLRQ FODXVH ZKLFK SURYLGHG WKDW QR VWDWH FRXOG GHQ\ WR DQ\ SHUVRQ WKH EHQHILW RI MXULVGLFWLRQ LQ WKH HTXDO SURWHFWLRQ RI WKH ODZV ZKDWHYHU KLV VWDWXV XQGHU WKH LPPLJUDWLRQ ODZV DQ DOLHQ ZDV D fSHUVRQf LQ DQ\ RUGLQDU\ VHQVH RI WKDW WHUP 7KLV &RXUWnV SULRU FDVHV UHFRJQL]HG WKDW LOOHJDO DOLHQV ZHUH fSHUVRQVf SURWHFWHG E\ WKH 'XH 3URFHVV &ODXVHV RI WKH )LIWK DQG )RXUWHHQWK $PHQGPHQWV ZKLFK &ODXVHV GR QRW LQFOXGH WKH SKUDVH fZLWKLQ LWV MXULVGLFWLRQf FRXOG QRW EH GLVWLQJXLVKHG RQ WKH DVVHUWHG JURXQG WKDW SHUVRQV ZKR KDG HQWHUHG WKH FRXQWU\ LOOHJDOO\ ZHUH QRW fZLWKLQ WKH MXULVGLFWLRQf RI D 6WDWH HYHQ LI WKH\ ZHUH SUHVHQW ZLWKLQ LWV ERXQGDULHV DQG VXEMHFW WR LWV ODZV 1RU GLG WKH ORJLF DQG KLVWRU\ RI WKH )RXUWHHQWK $PHQGPHQW VXSSRUW VXFK D FRQVWUXFWLRQ ,QVWHDG XVH RI WKH SKUDVH fZLWKLQ ,ELG ) 6XSS ) G r13O\OHU 86

PAGE 57

LWV MXULVGLFWLRQf FRQILUPHG WKH XQGHUVWDQGLQJ WKDW WKH )RXUWHHQWK $PHQGPHQWnV SURWHFWLRQ H[WHQGHG WR DQ\RQH FLWL]HQ RU VWUDQJHU ZKR ZDV VXEMHFW WR WKH ODZV RI D 6WDWH DQG UHDFKHG LQWR HYHU\ FRPHU RI D 6WDWHnV WHUULWRU\ f WKH GLVFULPLQDWLRQ FRQWDLQHG LQ WKH 7H[DV VWDWXWH ZKLFK ZLWKKHOG IURP ORFDO VFKRRO GLVWULFWV DQ\ VWDWH IXQGV IRU WKH HGXFDWLRQ RI FKLOGUHQ ZKR ZHUH QRW fOHJDOO\ DGPLWWHGf LQWR WKH 8QLWHG 6WDWHV DQG ZKLFK DXWKRUL]HG ORFDO VFKRRO GLVWULFWV WR GHQ\ HQUROOPHQW WR VXFK FKLOGUHQ FRXOG QRW EH FRQVLGHUHG UDWLRQDO XQOHVV LW IXUWKHUHG VRPH VXEVWDQWLDO JRDO RI WKH VWDWH $OWKRXJK XQGRFXPHQWHG UHVLGHQW DOLHQV FRXOG QRW EH WUHDWHG DV D fVXVSHFW FODVVf DQG HGXFDWLRQ ZDV QRW D fIXQGDPHQWDO ULJKWf VR DV WR UHTXLUH WKH 6WDWH WR MXVWLI\ WKH VWDWXWRU\ FODVVLILFDWLRQ E\ VKRZLQJ WKDW LW VHUYHG D FRPSHOOLQJ JRYHUQPHQWDO LQWHUHVW WKH 7H[DV VWDWXWH GLG LPSRVH D OLIHWLPH KDUGVKLS RQ D GLVFUHWH FODVV RI FKLOGUHQ QRW DFFRXQWDEOH IRU WKHLU GLVDEOLQJ VWDWXV 7KHVH FKLOGUHQ FRXOG QHLWKHU DIIHFW WKHLU SDUHQWVn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f WKH XQGRFXPHQWHG VWDWXV RI WKH FKLOGUHQ YHO QRQ GLG QRW HVWDEOLVK D VXIILFLHQW UDWLRQDO EDVLV IRU GHQ\LQJ WKH EHQHILWV WKDW WKH VWDWH DIIRUGHG RWKHU UHVLGHQWV ,W ZDV WUXH WKDW ZKHQ IDFHG ZLWK DQ HTXDO SURWHFWLRQ FKDOOHQJH UHVSHFWLQJ D 6WDWHnV GLIIHUHQWLDO WUHDWPHQW RI DOLHQV WKH FRXUWV QHHGHG WR EH DWWHQWLYH WR 3O\OHU 86

PAGE 58

FRQJUHVVLRQDO SROLF\ FRQFHUQLQJ DOLHQV %XW LQ WKH DUHD RI VSHFLDO FRQVWLWXWLRQDO VHQVLWLYLW\ SUHVHQWHG E\ WKHVH FDVHV DQG LQ WKH DEVHQFH RI DQ\ FRQWUDU\ LQGLFDWLRQ IDLUO\ GLVFHUQLEOH LQ WKH OHJLVODWLYH UHFRUG QR QDWLRQDO SROLF\ ZDV SHUFHLYHG WKDW PLJKW MXVWLI\ WKH 6WDWH LQ GHQ\LQJ WKHVH FKLOGUHQ DQ HOHPHQWDU\ HGXFDWLRQ f WKHUH ZDV QR QDWLRQDO SROLF\ WKDW PLJKW MXVWLI\ WKH VWDWH LQ GHQ\LQJ WKH FKLOGUHQ DQ HOHPHQWDU\ HGXFDWLRQ DQG f WKH 7H[DV VWDWXWH FRXOG QRW EH VXVWDLQHG DV IXUWKHULQJ LWV LQWHUHVW LQ WKH SUHVHUYDWLRQ RI WKH VWDWHf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fV DELOLW\ WR SURYLGH KLJKTXDOLW\ SXEOLF HGXFDWLRQ +LVWRU\ GLG QRW VKRZ WKDW H[FOXVLRQ RI XQGRFXPHQWHG FKLOGUHQ ZDV OLNHO\ WR LPSURYH WKH RYHUDOO TXDOLW\ RI HGXFDWLRQ LQ WKH 6WDWH 1HLWKHU ZDV WKHUH DQ\ PHULW WR WKH FODLP WKDW XQGRFXPHQWHG FKLOGUHQ ZHUH DSSURSULDWHO\ VLQJOHG RXW EHFDXVH WKHLU XQODZIXO SUHVHQFH ZLWKLQ WKH 8QLWHG 6WDWHV UHQGHUHG WKHP OHVV OLNHO\ WKDQ RWKHU FKLOGUHQ WR UHPDLQ ZLWKLQ WKH 6WDWHnV ERXQGDULHV DQG WR SXW WKHLU HGXFDWLRQ WR SURGXFWLYH VRFLDO RU SROLWLFDO XVH ZLWKLQ WKH 6WDWH 3O\OHU 86

PAGE 59

7KH &RXUW UHFRJQL]HG WKDW fHGXFDWLRQ ZDV QRW D ULJKWf WKH FRQVWLWXWLRQ JUDQWHG 2 LQGLYLGXDOV $GGLWLRQDOO\ WKH &RXUW UHMHFWHG WKH SUHPLVH WKDW WKH FKLOGUHQ FRPSULVHG RI D VXVSHFW FODVV TXDOLILHG IRU IXOO ULJKWV DV $PHULFDQV ,OOHJDO DOLHQ FKLOGUHQ XQOLNH PHPEHUV RI UDFLDO JURXSV ZHUH QRW D SURWHFWHG VXEFODVV EHFDXVH WKHLU FODVVLILFDWLRQ UHVXOWHG IURP YROXQWDU\ FULPLQDO GHFLVLRQV RQ WKH SDUW RI WKHLU SDUHQWV WR UHVLGH LQ WKH 8QLWHG 6WDWHV @f ,ELG S ,ELG SS ,ELG S

PAGE 60

GLIIHUHQFHV RI UDFH FRORU RU RI QDWLRQDOLW\ DQG WKH SURWHFWLRQ RI WKH ODZV ZDV D SOHGJH RI WKH SURWHFWLRQ RI HTXDO ODZVf 7KH &RXUWfV PDMRULW\ RSLQLRQ LQ 3O\OHU Y 'RH JLYHQ E\ -XVWLFH %UHQQDQ FRQWDLQHG UDWKHU GUDPDWLF DQG HOHJDQW ODQJXDJH KLJKOLJKWLQJ WKH SXEOLFLQWHUHVW DVSHFWV LQYROYHG 3HQDOL]LQJ FKLOGUHQ IRU WKH LOOHJDO HQWU\ RI WKHLU SDUHQWV ZRXOG KDYH PDUNHG WKHP ZLWK WKH fVWLJPD RI LOOLWHUDF\ IRU WKH UHVW RI WKHLU OLYHVf ,I HGXFDWLRQ LQ WKH 8QLWHG 6WDWHV ZDV QRW D IXQGDPHQWDO ULJKW WKH RSLQLRQ FRQWLQXHG fQHLWKHU ZDV LW PHUHO\ VRPH JRYHUQPHQWDO fEHQHILWf LQGLVWLQJXLVKDEOH IURP RWKHU IRUPV RI VRFLDO ZHOIDUHf $OVR XQGHUOLQHG E\ WKH &RXUW PDMRULW\ ZDV WKDW HGXFDWLRQ ZDV fWKH PRVW YLWDO FLYLF LQVWLWXWLRQ IRU WKH SUHVHUYDWLRQ RI D GHPRFUDWLF V\VWHP RI JRYHUQPHQWf DQG WKDW fZH FDQQRW LJQRUH WKH VLJQLILFDQW VRFLDO FRVWV ERUQH E\ RXU 1DWLRQ ZKHQ VHOHFW JURXSV DUH GHQLHG WKH PHDQV WR DEVRUE WKH YDOXHV DQG VNLOOV XSRQ ZKLFK RXU VRFLDO RUGHU UHVWVf 7KH\ DGGHG f,W LV FOHDU WKDW ZKDWHYHU VDYLQJV PLJKW EH DFKLHYHG E\ GHQ\LQJ WKHVH FKLOGUHQ DQ HGXFDWLRQ WKH\ DUH ZKROO\ LQVXEVWDQWLDO LQ OLJKW RI WKH FRVWV LQYROYHG WR WKHVH FKLOGUHQ WKH 6WDWH DQG WKH 1DWLRQf 7KH PDMRULW\ IXUWKHU DFNQRZOHGJHG WKDW LOOHJDO DOLHQV PLJKW KDYH D QHJDWLYH QHW LPSDFW XSRQ WKH HFRQRP\ EXW GLG QRW EX\ WKH DUJXPHQW WKDW EDUULQJ WKHLU FKLOGUHQ IURP SXEOLF HGXFDWLRQ ZRXOG KDYH WKH HIIHFW RI GLVFRXUDJLQJ LOOHJDO HQWULHV fDW OHDVW ZKHQ FRPSDUHG ZLWK WKH DOWHUQDWLYH RI SURKLELWLQJ HPSOR\PHQW RI LOOHJDO DOLHQVf 7KH PDMRULW\ IXUWKHU LQGLFDWHG WKDW WKH\ ZRXOG QRW EH LPSUHVVHG HYHQ LI WKH VWDWH FRXOG KDYH SURYHQ WKDW
PAGE 61

WKH TXDOLW\ RI SXEOLF HGXFDWLRQ ZDV LPSURYHG E\ H[FOXGLQJ D FHUWDLQ JURXS RI FKLOGUHQ IURP HGXFDWLRQDO RSSRUWXQLWLHV 7KH VWDWH WKH\ UHDVRQHG KDG QRW MXVWLILHG LWV VHOHFWLRQ RI WKH SDUWLFXODU JURXS $V D UHVXOW RI WKH 6XSUHPH &RXUWfV GHFLVLRQ QR VFKRRO LQ WKH 8QLWHG 6WDWHV FRXOG OHJDOO\ GHQ\ LPPLJUDQW VWXGHQWV DGPLVVLRQ RQ WKH EDVLV RI WKHLU XQGRFXPHQWHG VWDWXV QRU FRXOG WKH\ WUHDW XQGRFXPHQWHG VWXGHQWV GLIIHUHQWO\ WKDQ DQ\ RWKHU VWXGHQW -XVWLFHV :KLWH 5HKQTXLVW DQG 2f&RQQRU MRLQHG &KLHI -XVWLFH %XUJHU LQ KLV GLVVHQWLRQ RI WKH UXOLQJ ,Q WKH PLQRULW\ WKH\ IHOW WKDW LW ZDV VHQVHOHVV IRU DQ HQOLJKWHQHG VRFLHW\ WR GHSULYH DQ\ FKLOGUHQ LQFOXGLQJ LOOHJDO DOLHQ RI DQ HOHPHQWDU\ HGXFDWLRQ +RZHYHU fWKH &RQVWLWXWLRQ GLG QRW FRQVWLWXWH XV DV f3ODWRQLF *XDUGLDQf QRU GLG LW YHVW LQ WKH &RXUW WKH DXWKRULW\ WR HOLPLQDWH ODZV EHFDXVH WKH\ GLG QRW PHHW RXU VWDQGDUGV RI GHVLUDEOH VRFLDO SROLF\ fZLVGRPf RU fFRPPRQ VHQVHff 6HH $33(1',; IRU IXUWKHU FODULILFDWLRQf 7KH PLQRULW\ RI WKH &RXUW KDG QR SUREOHP ZLWK WKH FRQFOXVLRQ WKDW WKH (TXDO 3URWHFWLRQ &ODXVH RI WKH )RXUWHHQWK $PHQGPHQW DSSOLHG WR LOOHJDO DOLHQV ZKR ZHUH SK\VLFDOO\ fZLWKLQ WKH MXULVGLFWLRQf RI D VWDWH 7KH (TXDO 3URWHFWLRQ &ODXVH GLG QRW ,ELG S 0DUWKD 0F&DUWK\ f7KH 5LJKW WR DQ (GXFDWLRQ ,OOHJDO $OLHQVf -RXUQDO RI (GXFDWLRQDO (TXLW\ DQG /HDGHUVKLS 6XPPHU f 3O\OHU 86 ,ELG 79$ Y +LOO 86 f 3O\OHU 86

PAGE 62

PDQGDWH LGHQWLFDO WUHDWPHQW RI GLIIHUHQW FDWHJRULHV RI SHUVRQV 7KH LVVXH ZDV ZKHWKHU IRU SXUSRVHV RI DOORFDWLQJ UHVRXUFHV D VWDWH KDG D OHJLWLPDWH UHDVRQ WR GLIIHUHQWLDWH EHWZHHQ SHUVRQV ZKR ZHUH ODZIXOO\ ZLWKLQ WKH VWDWH DQG WKRVH ZKR ZHUH QRW 7KHUHIRUH WKH GLVWLQFWLRQ GUDZQ E\ 7H[DV EDVHG QRW RQ LWV RZQ OHJLWLPDWH LQWHUHVWV EXW RQ WKH FODVVLILFDWLRQV E\ WKH )HGHUDO *RYHUQPHQWVf LPPLJUDWLRQ ODZV DQG SROLFLHV ZDV QRW XQFRQVWLWXWLRQDO 7KH &RXUW KDG UHFRJQL]HG WKDW LQ DOORFDWLQJ JRYHUQPHQWDO EHQHILWV WR D JLYHQ FODVV RI DOLHQV RQH fPD\ WDNH LQWR DFFRXQW WKH FKDUDFWHU RI WKH UHODWLRQVKLS EHWZHHQ WKH DOLHQ DQG WKH FRXQWU\f :KHQ WKDW fUHODWLRQVKLSf ZDV D IHGHUDOO\ SURKLELWHG RQH WKHUH FRXOG EH QR SUHVXPSWLRQ WKDW D VWDWH KDG D FRQVWLWXWLRQDO GXW\ WR LQFOXGH LOOHJDO DOLHQV DPRQJ WKH UHFLSLHQWV RI LWV JRYHUQPHQWDO EHQHILWV 7KH &RXUW KHOG PDQ\ WLPHV WKDW WKH LPSRUWDQFH RI D JRYHUQPHQWDO VHUYLFH GLG QRW HOHYDWH LW WR D fIXQGDPHQWDO ULJKWf IRU SXUSRVHV RI HTXDO SURWHFWLRQ DQDO\VLV ,Q 6DQ $QWRQLR ,QGHSHQGHQW 6FKRRO 'LVWULFW -XVWLFH 3RZHOO VSHDNLQJ IRU WKH FRXUW H[SUHVVO\ UHMHFWHG WKH SURSRVLWLRQ WKDW VWDWH ODZV GHDOLQJ ZLWK SXEOLF HGXFDWLRQ ZHUH VXEMHFW WR VSHFLDO VFUXWLQ\ XQGHU WKH (TXDO 3URWHFWLRQ &ODXVH 7KH &RXUW IXUWKHU LQGLFDWHG WKHUH ZDV -HIIHUVRQ Y +DFNQH\ 86 f 5HHG Y 5HHG 86 f 3O\OHU$6O 86 0DWKHZV Y 'LD] 86 f 3O\OHU 86 JR 6DQ $QWRQLR ,QGHSHQGHQW 6FKRRO 'LVW Y 5RGULJXH] 86 f /LQGVH\ Y 1RUPHW 86 f

PAGE 63

44 QR PHDQLQJIXO ZD\ WR GLVWLQJXLVK EHWZHHQ HGXFDWLRQ DQG RWKHU JRYHUQPHQWDO EHQHILWV :DV HGXFDWLRQ PRUH fIXQGDPHQWDOf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nV XVH RI WKH VDPH FODVVLILFDWLRQ IRU FRPSDUDEOH SXUSRVHV DW WKH YHU\ OHDVW WKH\ WHQGHG WR VXSSRUW WKH UDWLRQDOLW\ RI H[FOXGLQJ LOOHJDO DOLHQ UHVLGHQWV RI D VWDWH IURP VXFK SURJUDPV VR DV WR SUHVHUYH WKH VWDWHnV ILQLWH UHYHQXHV IRU WKH EHQHILW RI ODZIXO UHVLGHQWV 7KH &RXUW PDLQWDLQHG f%DUULQJ XQGRFXPHQWHG FKLOGUHQ IURP ORFDO VFKRROV ZRXOG QRW QHFHVVDULO\ LPSURYH WKH TXDOLW\ RI HGXFDWLRQ SURYLGHG LQ WKRVH VFKRROVf +RZHYHU WKH OHJLWLPDF\ RI EDUULQJ LOOHJDO DOLHQV IURP SURJUDPV VXFK DV 0HGLFDUH RU 0HGLFDLG GLG QRW GHSHQG RQ D VKRZLQJ WKDW WKH EDUULHU ZRXOG fLPSURYH WKH TXDOLW\f RI PHGLFDO FDUH JLYHQ WR SHUVRQV ODZIXOO\ HQWLWOHG WR SDUWLFLSDWH LQ VXFK SURJUDPV (GXFDWLRQ OLNH 3O\OHU 86 86& If HG DQG 6XSS ,9f DQG &)5 f &)5 f 86&  DQG &)5 Ef f 86& R DQG &)5 Dff f 0DWKHZV Y 'LD] 86 3O\OHU 86 6HH )6XSS (' 7H[ f

PAGE 64

PHGLFDO FDUH ZDV HQRUPRXVO\ H[SHQVLYH DQG WKHUH FRXOG EH QR GRXEW WKDW YHU\ ODUJH DGGHG FRVWV ZRXOG IDOO RQ WKH 6WDWH RU LWV ORFDO VFKRRO GLVWULFWV DV D UHVXOW RI WKH LQFOXVLRQ RI LOOHJDO DOLHQV LQ WKH WXLWLRQIUHH SXEOLF VFKRROV -XVWLFH %XUJHU ZHQW RQ WR VD\ WKDW f'HQ\LQJ D IUHH HGXFDWLRQ WR LOOHJDO DOLHQ FKLOGUHQ LV QRW D FKRLFH ZRXOG PDNH ZHUH D OHJLVODWRU $SDUW IURP FRPSDVVLRQDWH FRQVLGHUDWLRQV WKH ORQJUDQJH FRVWV RI H[FOXGLQJ DQ\ FKLOGUHQ IURP WKH SXEOLF VFKRRO PD\ ZHOO RXWZHLJK WKH FRVWV RI HGXFDWLQJ WKHPfr %XW WKDW ZDV QRW WKH LVVXH WKH IDFW WKDW WKHUH ZHUH VRXQG SROLF\ DUJXPHQWV DJDLQVW WKH 7H[DV /HJLVODWXUHfV UXOH GLG QRW PDNH LW XQFRQVWLWXWLRQDO -XVWLFH %XUJHU VDZ WKH UXOLQJ DV D TXLFN IL[ IRU WKH IDLOLQJV RI WKH SROLWLFDO SURFHVVHV +H IHOW WKDW EHWWHU HQIRUFHPHQW RI LPPLJUDWLRQ ODZV DQG SROLFLHV ZRXOG KDYH SUHYHQWHG WKH QHHG WR UXOH RQ WKH ULJKW RI LOOHJDO FKLOGUHQ WR D IUHH HGXFDWLRQ 7KH FRXUW VXJJHVWHG WKDW fRXUf LQVWLWXWLRQV KDG FRQILGHQWO\ DQG VXFFHVVIXOO\ XQGHUWDNHQ VLPLODU FKDOOHQJHV ,Q 3O\OHU FRQILGHQFH LQ XQGHUWDNLQJ WRXJK HGXFDWLRQDO PLVVLRQV DQDORJRXV WR WKRVH LQ SULRU GHFLVLRQV VXFK DV 0H\HU Y 6WDWH RI 1HEUDVND 3O\OHU 86 ,ELG ,ELG ,Q 0H\HU Y 6WDWH RI 1HEUDVND 86 f WKH 8QLWHG 6WDWHV 6XSUHPH &RXUW XSKHOG WKH ULJKW RI SDUHQWV DQG WHDFKHUV WR DUUDQJH IRUHLJQ ODQJXDJH LQVWUXFWLRQ IRU FKLOGUHQ DQG VWUXFN GRZQ D 1HEUDVND VWDWXWH SURKLELWLQJ IRUHLJQ ODQJXDJH LQVWUXFWLRQ WR FKLOGUHQ EHIRUH WKH HLJKWK JUDGH VHH 1HE /DZV &+ f 7KH &RXUW VWDWHG f,W LV WKH QDWXUDO GXW\ RI WKH SDUHQW WR JLYH KLV FKLOGUHQ HGXFDWLRQ VXLWDEOH WR WKHLU VWDWLRQ LQ OLIH ff 7KH &RXUW VDZ QR KDUP LQ *HUPDQ ODQJXDJH LQVWUXFWLRQ WR FKLOGUHQ ZKHQ WKH FKLOGUHQfV SDUHQWV GLG QRW FRQWHVW WKH ULJKW RI WKH VWDWH WR UHDVRQDEO\ UHJXODWH VFKRROV FRPSHO DWWHQGDQFH DQG SUHVFULEH D FXUULFXOXP IRU VWDWHVXSSRUWHG LQVWLWXWLRQV 0H\HU SS f

PAGE 65

3LHUFH Y 6RFLHW\ RI 6LVWHUV DQG %URZQ Y %RDUG RI (GXFDWLRQ SUHYDLOHG RYHU WKH SXEOLF LQWHUHVW GRFWULQH UHYLWDOL]HG LQ $PEDFK Y 1RUZLFK ,Q 3LHUFH Y 6RFLHW\ RI 6LVWHUV 86 f WKH 8QLWHG 6WDWHV 6XSUHPH &RXUW H[WHQGHG WKH 0H\HU UHDVRQLQJ WR SURWHFW WKH ULJKW RI SULYDWH LQVWLWXWLRQV WR HGXFDWH FKLOGUHQ 7KH &RXUW LQYDOLGDWHG DQ 2UHJRQ VWDWXWH SURKLELWLQJ SULYDWH HGXFDWLRQ RI fQRUPDOf FKLOGUHQ ZLWKLQ D UHDVRQDEOH GLVWDQFH IURP D SXEOLF VFKRRO VHH /DZV 2U Sf 7KH &RXUW QRWHG WKDW LW ZDV ZLWKLQ WKH VWDWHfV SRZHU WR UHDVRQDEO\ UHJXODWH VFKRROV WR UHTXLUH WKDW WHDFKHUV EH RI fJRRG PRUDO FKDUDFWHU DQG SDWULRWLF GLVSRVLWLRQf RU WR UHTXLUH WKH WHDFKLQJ RI FHUWDLQ VXEMHFWV fSODLQO\ HVVHQWLDO WR JRRG FLWL]HQVKLSf +RZHYHU WKH &RXUW KHOG WKDW WKH VWDWHV KDG QR JHQHUDO SRZHU WR fVWDQGDUGL]H LWV FKLOGUHQ E\ IRUFLQJ WKHP WR DFFHSW LQVWUXFWLRQ IURP SXEOLF WHDFKHUV RQO\f 3LHUFH SS f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f WKH 8QLWHG 6WDWHV 6XSUHPH FRXUW XSKHOG D 1HZ LQWHUQDO FLWDWLRQV RPLWWHG@f 1HYHUWKHOHVV WKH &RXUW DFNQRZOHGJHG WKDW VWDWHV KDYH VRPH IXQFWLRQV VR HQWZLQHG ZLWK VWDWH JRYHUQPHQWDO RSHUDWLRQV VR DV WR DOORZ H[FOXVLRQ RI DOLHQV XQGHU WKH VWLOO H[WDQW SXEOLF LQWHUHVW GRFWULQH ,ELG SS f &LWLQJ %URZQ 6RFLHW\ RI 6LVWHUV DQG 0H\HU WKH &RXUW VWUHVVHG WKH LPSRUWDQFH RI HGXFDWLRQ WR RXU GHPRFUDWLF VRFLHW\ DQG WR RXU FXOWXUH ,ELG SS >RWKHU LQWHUQDO FLWDWLRQ RPLWWHG@f 0RUHRYHU WKH &RXUW FLWHG QXPHURXV DXWKRULWLHV UHJDUGLQJ WKH LQFXOFDWLQJ DQG GHPRFUDWL]LQJ UROH RI WKH fSXEOLF VFKRROV DV DQ fDVVLPLODWLYH IRUFHf E\ ZKLFK GLYHUVH DQG FRQIOLFWLQJ HOHPHQWV RI RXU VRFLHW\ DUH EURXJKW WRJHWKHU RQ D EURDG EXW FRPPRQ JURXQGf ,ELG SS f $GGLWLRQDOO\ WKH FRXUW UHFRJQL]HG WKH VSHFLDO UROH WKDW WHDFKHUV SOD\ LQ WKH HGXFDWLRQ RI FKLOGUHQ DV ZHOO DV WKH ZLGH ODWLWXGH WHDFKHUV KDYH LQ WKH PDQQHU LQIRUPDWLRQ LV FRPPXQLFDWHG WR VWXGHQWV DV D UDWLRQDOH IRU D VWDWH WR SXW UHDVRQDEOH UHTXLUHPHQWV RQ WHDFKHUV ,ELG SS f 2QFH DJDLQ WKH FRXUW KDG DFNQRZOHGJHG WKH QH[XV EHWZHHQ FXOWXUDO G\QDPLVP DQG FRUH YDOXHV

PAGE 66

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f Qr $PEDFK 86 DW ,Q $PEDFK -XVWLFH 3RZHOO GLG QRW UHTXLUH HYLGHQFH SURYLQJ RU GLVSURYLQJ ZKHWKHU OHJDOO\ UHVLGHQWf DOLHQ WHDFKHUV QHJDWLYHO\ DIIHFWHG WKH 1HZ 3RZHOO FRQFXUULQJ@f -XVWLFH 3RZHOOfV RQO\ PHQWLRQ RI WKH FRQFHUQV RI RUGLQDU\ FLWL]HQV ZDV WKH EODQG VWDWHPHQW WKDW KH ZDV fQRW XQPLQGIXO RI ZKDW PXVW EH WKH H[DVSHUDWLRQ RI UHVSRQVLEOH FLWL]HQV DQG JRYHUQPHQW DXWKRULWLHV LQ 7H[DV DQG RWKHU 6WDWHV VLPLODUO\ VLWXDWHGf ,ELG S >3RZHOO FRQFXUULQJ@f 0H\HU Y 6WDWH RI 1HEUDVND 86 f

PAGE 67

7DEOH 7LPHOLQH RI 86 ,PPLJUDWLRQ DQG $OLHQ (GXFDWLRQ 3ROLFLHV 1DWXUDOL]DWLRQ 5XOH DGRSWHG )HGHUDO JRYHUQPHQW HVWDEOLVKHG D WZR\HDU UHVLGHQF\ UHTXLUHPHQW RQ LPPLJUDQWV ZLVKLQJ WR EHFRPH XV FLWL]HQV 5HSRUWLQJ 5XOH DGRSWHG 'DWD EHJDQ WR EH FROOHFWHG RQ LPPLJUDWLRQ LQWR WKH 8QLWHG 6WDWHV 6KLSVf FDSWDLQV DQG RWKHUV ZHUH UHTXLUHG WR NHHS DQG VXEPLW PDQLIHVWV RI LPPLJUDQWV HQWHULQJ WKH 86 )LUVW ([FOXVLRQDU\ $FW &RQYLFW SURVWLWXWHV DQG fFRROLHVf &KLQHVH FRQWUDFW ODERUHUVf ZHUH EDUUHG IURP HQWU\ LQWR WKH 8QLWHG 6WDWHV ,PPLJUDWLRQ $FW SDVVHG 7KH IHGHUDO JRYHUQPHQW PRYHG WR ILUPO\ HVWDEOLVK LWV DXWKRULW\ RYHU LPPLJUDWLRQ &KLQHVH LPPLJUDWLRQ ZDV FXUWDLOHG H[FRQYLFWV OXQDWLFV LGLRWV DQG WKRVH XQDEOH WR WDNH FDUH RI WKHPVHOYHV ZHUH H[FOXGHG ,Q DGGLWLRQ D WD[ ZDV OHYLHG RQ QHZO\ DUULYLQJ LPPLJUDQWV &RQWUDFW ODERUHUVn HQWU\ EDUUHG 7KLV OHJLVODWLRQ UHYHUVHG DQ HDUOLHU IHGHUDO ODZ OHJDOL]LQJ WKH WUDGH LQ FRQWUDFW ODERU 2IILFH RI ,PPLJUDWLRQ FUHDWHG (VWDEOLVKHG DV SDUW RI WKH 86 7UHDVXU\ 'HSDUWPHQW WKLV QHZ RIILFH ZDV ODWHU JLYHQ DXWKRULW\ RYHU QDWXUDOL]DWLRQ DQG PRYHG WR WKH 86 -XVWLFH 'HSDUWPHQW ,W ZDV NQRZQ DV WKH ,PPLJUDWLRQ DQG 1DWXUDOL]DWLRQ 6HUYLFHf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n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nV UHSUHVHQWDWLRQ LQ WKH FHQVXV 7KH ODZ ZDV GHVLJQHG SULPDULO\ WR UHVWULFW WKH IORZ RI LPPLJUDQWV FRPLQJ IURP HDVWHUQ DQG VRXWKHUQ (XURSH 0H\HU Y 1HEUDVND 86 6XSUHPH &RXUW GHFLVLRQ VWUXFN GRZQ DQ HDUOLHU 1HEUDVND VWDWXWH EDUULQJ LQGLYLGXDOV DQG VFKRROV IURP SURYLGLQJ LQVWUXFWLRQ LQ D ODQJXDJH RWKHU WKDQ (QJOLVK WR DQ\ VWXGHQW ZKR KDG QRW FRPSOHWHG WKH HLJKWK JUDGH 2ULJLQV $FW 7KH $FW UHGXFHG WKH DQQXDO LPPLJUDWLRQ FHLOLQJ WR $ UHYLVHG TXRWD UHGXFHG DGPLVVLRQV WR SHUFHQW RI HDFK QDWLRQDOLW\ JURXSnV UHSUHVHQWDWLRQ LQ WKH FHQVXV 7KH 86 %RUGHU 3DWURO ZDV FUHDWHG ,PPLJUDWLRQ &HLOLQJ )XUWKHU 5HGXFHG 7KH DQQXDO LPPLJUDWLRQ FHLOLQJ ZDV IXUWKHU UHGXFHG WR WKH TXRWD ZDV UHYLVHG WR SHUFHQW RI HDFK QDWLRQDOLW\nV UHSUHVHQWDWLRQ LQ WKH FHQVXV 7KLV EDVLF ODZ UHPDLQV LQ HIIHFW WKURXJK

PAGE 68

7DEOH FRQWLQXHG 1DWLRQDO 2ULJLQV $FW 7KH DQQXDO LPPLJUDWLRQ FHLOLQJ RI ZDV PDGH SHUPDQHQW ZLWK SHUFHQW RI DGPLVVLRQV VODWHG IRU WKRVH FRPLQJ IURP QRUWKHUQ DQG ZHVWHUQ (XURSH ZKLOH WKH RWKHU SHUFHQW ZHUH UHVHUYHG IRU WKRVH FRPLQJ IURP VRXWKHUQ DQG HDVWHUQ (XURSH 'LVSODFHG 3HUVRQV $FW (QWU\ ZDV DOORZHG IRU SHUVRQV GLVSODFHG E\ :RUOG :DU ,, +RZHYHU VXFK UHIXJHHV PXVW KDYH SDVVHG D VHFXULW\ FKHFN DQG KDG SURRI RI HPSOR\PHQW DQG KRXVLQJ WKDW GLG QRW WKUHDWHQ 86 FLWL]HQVn MREV DQG KRPHV 0F&DUUDQ:DOWHU $FW 7KH $FW FRQVROLGDWHG HDUOLHU LPPLJUDWLRQ ODZV DQG UHPRYHG UDFH DV D EDVLV IRU H[FOXVLRQ ,Q DGGLWLRQ WKH $FW LQWURGXFHG DQ LGHRORJLFDO FULWHULRQ IRU DGPLVVLRQ LPPLJUDQWV DQG YLVLWRUV WR WKH 8QLWHG 6WDWHV FRXOG EH GHQLHG HQWU\ RQ WKH EDVLV RI WKHLU SROLWLFDO LGHRORJ\ HJ LI WKH\ ZHUH &RPPXQLVWV RU IRUPHU 1D]LVf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f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fRQ DFFRXQW RI UDFH UHOLJLRQ QDWLRQDOLW\ RU SROLWLFDO RSLQLRQf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f (QJOLVKEDVHG ELOLQJXDO HGXFDWLRQ SURJUDP GLG QRW YLRODWH IHGHUDO ODZ ,PPLJUDWLRQ 5HIRUP DQG &RQWURO $FW 7KH DQQXDO LPPLJUDWLRQ FHLOLQJ ZDV UDLVHG WR $PQHVW\ ZDV RIIHUHG WR WKRVH LOOHJDO DOLHQV DEOH WR SURYH FRQWLQXRXV UHVLGHQFH LQ WKH 86 VLQFH -DQXDU\ 6WLII VDQFWLRQV IRU HPSOR\HUV RI LOOHJDO DOLHQV ,PPLJUDWLRQ $FW RI 7KH DQQXDO LPPLJUDWLRQ FHLOLQJ ZDV IXUWKHU UDLVHG WR IRU DQG WKHUHDIWHU WKH FHLOLQJ ZRXOG GURS WR D \HDU 7HQ WKRXVDQG SHUPDQHQW UHVLGHQW YLVDV ZHUH RIIHUHG WR WKRVH LPPLJUDQWV DJUHHLQJ WR LQYHVW DW OHDVW PLOOLRQ LQ 86 XUEDQ DUHDV RU LQ 86 UXUDO DUHDV 7KH 0F&DUUDQ:DOWHU $FW RI ZDV DPHQGHG VR WKDW SHRSOH FRXOG QR ORQJHU EH GHQLHG DGPLWWDQFH WR WKH 8QLWHG 6WDWHV RQ WKH EDVLV RI WKHLU EHOLHIV VWDWHPHQWV RU DVVRFLDWLRQV

PAGE 69

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

PAGE 70

,OOHJDO LPPLJUDQW HGXFDWLRQ OHJLVODWLRQ ZDV KLVWRULFDOO\ LQ IDYRU RI SURYLGLQJ VDLG HGXFDWLRQ WR DOO VWXGHQWV LQ UHVLGHQFH LQ D JLYHQ VWDWH ZKHWKHU OHJDO RU RWKHUZLVH DQG LQ D ODQJXDJH FRQGXFLYH WR WKHLU OHDUQLQJ VXFFHVV *LYHQ WKH ODZV DQG WUHQGV LQ LPPLJUDWLRQ HGXFDWRUV LQ HYHU\ VHFWRU H[SHFWHG D VXEVWDQWLDO VKDUH RI WKHLU VWXGHQWV WR FRPH IURP RWKHU FRXQWULHV ,PPLJUDWLRQ LQ ERWK LWV OHJDO DQG LOOHJDO PDQLIHVWDWLRQV FRQWLQXHG WR ULVH WR KLJKHU OHYHOV WKDQ HYHU EHIRUH LQ WKH QDWLRQfV KLVWRU\ $OWKRXJK D ODUJHU QXPEHU RI KLJKO\ HGXFDWHG LPPLJUDQWV ZHUH RQ WKHLU ZD\ DQ HYHQ JUHDWHU IORZ RI LOOHJDO LPPLJUDQWV HQODUJHG WKH QDWLRQVf SRRO RI LOOLWHUDWH RU SRRUO\ HGXFDWHG UHVLGHQWV 7KH FRQWLQXHG HPSKDVLV RQ IDPLO\ UHXQLILFDWLRQ DOVR EURXJKW ODUJH QXPEHUV RI LPPLJUDQWV ZKR WHQGHG WR KDYH OHVV HGXFDWLRQ WKDW WKH RULJLQDO HQWUDQWV (GXFDWRUV LQ WKH 8QLWHG 6WDWHV QHHGHG WR EH UHDG\ WR VHUYH DQ HYHQ PRUH GLYHUVH FOLHQWHOH LQ LWV IXWXUH

PAGE 71

&+$37(5 ,00,*5$7,21 /$:6 $1' 352326,7,21 ,QWURGXFWLRQ 7KLV FKDSWHU UHYLHZV WKH PDMRU LPPLJUDQW HGXFDWLRQ ODZV DQG SROLFLHV RI WKH ODVW KDOI RI WKH QLQHWHHQWK FHQWXU\ ,W GLVFXVVHV ZD\V LQ ZKLFK HDFK DUH EDVHG RQ SUHFHGHQW SROLF\ DQG KRZ WKH\ DUH DVVRFLDWHG 2I SDUWLFXODU FRQFHUQ DUH 3O\OHU Y 'RH DQG &DOLIRUQLDf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f8QLWHG 6WDWHV QDWLRQDOVf DQG fDOLHQVf $OPRVW DOO QDWLRQDOV DOVR FDUULHG 3O\OHU Y 'RH 86 f 3URSRVLWLRQ ZDV DSSURYHG E\ WKH HOHFWRUV RI &DOLIRUQLD RQ 1RYHPEHU DV DQ LQLWLDWLYH VWDWXWH 6HH &DO /HJLV 6HUY 3URS :HVWODZf ,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW ,1$f 3XEOLF /DZ >V Dff@ 86& >V Dff@ f GHILQHV fDOLHQf DV fDQ\ SHUVRQ QRW D FLWL]HQ RU QDWLRQDO RI WKH 8QLWHG 6WDWHVf 6LQFH DOO FLWL]HQV DUH QDWLRQDOV WKH GHILQLWLRQ RI fDOLHQf FRXOG HDVLO\ UHDG fDQ\ SHUVRQ QRW D QDWLRQDO RI WKH 8QLWHG 6WDWHVf

PAGE 72

WKH WLWOH fFLWL]HQf $OLHQV LQ WXUQ ZHUH GLYLGHG LQWR WZR VXEJURXSV LPPLJUDQWV DQG QRQLPPLJUDQWV $ QRQLPPLJUDQW ZDV DQ\ DOLHQ ZKR FRXOG SURYH WKDW KH RU VKH IHOO LQWR RQH RI WKH VWDWXWRULO\ HQXPHUDWHG FDWHJRULHV RI WHPSRUDU\ YLVLWRUV VXFK DV VWXGHQWV WRXULVWV EXVLQHVV YLVLWRUV RU WHPSRUDU\ ZRUNHUV $OO RWKHU DOLHQV ZHUH LPPLJUDQWV DQG WKHUHIRUH VXEMHFW WR WKH PRUH ULJRURXV VWDQGDUGV DSSOLFDEOH WR WKRVH ZKR VRXJKW SHUPDQHQW UHVLGHQFH LQ WKH 8QLWHG 6WDWHV ,PPLJUDQWV WKHPVHOYHV ZHUH VXEFODVVLILHG 7KHUH ZHUH WKRVH ZKR ZHUH fODZIXOO\ DGPLWWHG IRU SHUPDQHQW UHVLGHQFHf KROGHUV RI VRFDOOHG fJUHHQ FDUGVf $QG WKHUH ZHUH WKRVH ZKR ZHUH KHUH XQODZIXOO\ KDYLQJ HQWHUHG LOOHJDOO\ RYHUVWD\HG RU RWKHUZLVH YLRODWHG WKH WHUPV RI WHPSRUDU\ DGPLVVLRQ XQGRFXPHQWHG RU LOOHJDO LPPLJUDQWVf 7KHUH ZDV DQ DGGLWLRQDO K\EULG FDWHJRU\ NQRZQ DV DOLHQV f3HUPDQHQWO\ 5HVLGLQJ 8QGHU &RORU RI /DZf RU 358&2/V :KLOH WKH GHILQLWLRQ RI 358&2/ YDULHG IURP RQH SURJUDP WR DQRWKHU WKH WHUP W\SLFDOO\ HQFRPSDVVHG WKRVH ZKR KDG UHFHLYHG DV\OXP VRPH RI WKRVH ZKR KDG EHHQ SDUROHG IURP SULVRQ LQWR WKH 8QLWHG 6WDWHV DQG PLVFHOODQHRXV RWKHUV ZKR UHPDLQHG LQ WKH 8QLWHG 6WDWHV ZLWK WKH NQRZOHGJH DQG SHUPLVVLRQ RI WKH ,PPLJUDWLRQ DQG 1DWXUDOL]DWLRQ 6HUYLFH ,16f DQG ZKRP WKH ,16 GLG f R QRW LQWHQG WR UHPRYH 7KH PRVW JHQHUDO REVHUYDWLRQ ZDV WKDW WKH PDMRU IHGHUDO DQG VWDWH ,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW 3XEOLF /DZ ,1$f >V Df f@ 86& >V Dff@ DV DPHQGHG f ,ELG ,ELG >V Dff@ 86 &RPPLVVLRQ RQ ,PPLJUDWLRQ 5HIRUP 86 ,PPLJUDWLRQ 3ROLF\ 5HVWRULQJ &UHGLELOLW\ f >KHUHLQDIWHU &(5@ LQFOXGHV FHUWDLQ &XEDQV DQG +DLWLDQV DQG DOLHQV ZKRVH GHSRUWDWLRQV KDYH EHHQ ZLWKKHOG RU VWD\HG ,ELG

PAGE 73

EHQHILW SURJUDPV ZHUH RSHQ WR 8QLWHG 6WDWHV FLWL]HQV DQG WR WKRVH DOLHQV ZKR KDG EHHQ ODZIXOO\ DGPLWWHG DV SHUPDQHQW UHVLGHQWV ,Q DGGLWLRQ VHYHUDO LPSRUWDQW SURJUDPV LQFOXGLQJ $LG WR )DPLOLHV ZLWK 'HSHQGHQW &KLOGUHQ $)'&f 6XSSOHPHQWDO 6HFXULW\ ,QFRPH 66,f DQG 0HGLFDLG FRYHUHG 358&2/V 7R EH DGPLWWHG WR WKH 8QLWHG 6WDWHV LQ DQ\ FDSDFLW\ DQ DOLHQ QHHGHG WR SURYH KH RU VKH ZDV QRW fOLNHO\ DW DQ\ WLPH WR EHFRPH D SXEOLF FKDUJHf $ FRPPRQ ZD\ WR HVWDEOLVK WKDW ZDV WR VXEPLW DQ fDIILGDYLW RI VXSSRUWf IURP DQ $PHULFDQ VSRQVRU ZKR ZDV ZLOOLQJ DQG DEOH WR SURYLGH ILQDQFLDO EDFNLQJ )RU SXUSRVHV RI DVVHVVPHQW RI ILQDQFLDO HOLJLELOLW\ XQGHU YDULRXV IHGHUDO EHQHILW SURJUDPV KRZHYHU D SRUWLRQ RI WKH $LG WR )DPLOLHV ZLWK 'HSHQGHQW &KLOGUHQ $)'&f 7KH $)'& SURJUDP SURYLGHG DVVLVWDQFH IRU EDVLF QHHGV VXFK DV IRRG DQG VKHOWHU WR TXDOLI\LQJ IDPLOLHV ZLWK FKLOGUHQ 7KH IDPLOLHV PHW FHUWDLQ LQFRPH LPPLJUDWLRQ VWDWXV DQG RWKHU TXDOLILFDWLRQV WR UHFHLYH $)'& 7KH IHGHUDO JRYHUQPHQW DQG WKH VWDWHV MRLQWO\ IXQGHG WKH SURJUDP 7KRVH SHUVRQV QRW HOLJLEOH LQFOXGHG XQGRFXPHQWHG DOLHQV DQG WKRVH XQGRFXPHQWHG DOLHQV ZKR EHFDPH OHJDOL]HG DV D UHVXOW RI ,5&$ 6XSSOHPHQWDO 6HFXULW\ ,QFRPH 66,f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f f3XEOLF FKDUJHf ZDV D WHUP XVHG LQ LPPLJUDWLRQ ODZ WR GHVFULEH VRPHRQH ZKR ZDV RU OLNHO\ WR EHFRPH GHSHQGHQW RQ SXEOLF EHQHILWV ,Q SUDFWLFH SXEOLF FKDUJH FRQVLGHUDWLRQV KDYH KLVWRULFDOO\ EHHQ D IDFWRU LQ WKH DGPLVVLELOLW\ RI DOLHQV

PAGE 74

DOLHQfV LQFRPH DQG UHVRXUFHV ZDV fGHHPHGf WR LQFOXGH WKRVH RI WKH DIILDQW IRU D FHUWDLQ QXPEHU RI \HDUV DIWHU WKH DOLHQf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f &,5 SS f,ELG 8&/$ / 5HY r ,ELG S ,ELG

PAGE 75

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

PAGE 76

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f ,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW $PHQGPHQWV RI 2FWREHU 6WDW f

PAGE 77

LPPLJUDWLRQ WR WKH 8QLWHG 6WDWHV 7KH ,PPLJUDWLRQ 5HIRUP DQG &RQWURO $FW SURYLGHG IRU HPSOR\HU VDQFWLRQV DJDLQVW EXVLQHVVHV WKDW HPSOR\HG XQGRFXPHQWHG DOLHQV DQG OHJDOL]DWLRQ IRU TXDOLILHG XQGRFXPHQWHG DOLHQV ,PPLJUDWLRQ SROLF\ GXULQJ WKH GHFDGH RI WKH V ZDV EDVHG RQ 7KH ,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW ZKLFK SULRULWL]HG HOLJLELOLW\ RQ WKH EDVLV RI IDPLO\ UHXQLILFDWLRQ DORQJ ZLWK WKH QHHG IRU LPPLJUDQWV ZLWK VSHFLILF VNLOOV 7KH ,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW SDVVHG LQ RYHU 3UHVLGHQW 7UXPDQf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f DV DPHQGHG E\ WKH ,PPLJUDWLRQ $FW RI 3/ 6WDW f -DPHV *LPSHO DQG -DPHV 5 (GZDUGV -U 7KH &RQJUHVVLRQDO 3ROLWLFV RI ,PPLJUDWLRQ 5HIRUP 1HHGKDP +HLJKWV 0$ $OO\Q t %DFRQ ,ELG S 5HIXJHH $FW RI 0DUFK ,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW > Dff$f@

PAGE 78

UHJXODU IORZ RI UHIXJHHV DQG HPHUJHQF\ DGPLVVLRQV 7KH 5HIXJHH $FW RI GHILQHG fUHIXJHHf LQ 86 ODZ LW WKHQ EHFDPH VHFWLRQ Dff$f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f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fV 2IILFH 0DUFK ,PPLJUDWLRQ 5HIRUP DQG &RQWURO $FW RI 3XEOLF /DZ

PAGE 79

SHUFHQW ZHUH DYDLODEOH IRU LPPLJUDQWV IURP FRXQWULHV WKDW KDG UHFHLYHG UHODWLYHO\ IHZ YLVDV LQ SUHYLRXV \HDUV 7DEOH ,PPLJUDWLRQ WR WKH 86 LQ 5HODWLYHV RI 86 FLWL]HQV DQG SHUPDQHQW UHVLGHQWV 6NLOOHG ZRUNHUV DQG WKHLU IDPLOLHV &LWL]HQV IURP FRXQWULHV ZLWK IHZ UHFHQW LPPLJUDQW YLVDV 3ROLWLFDO UHIXJHHV ,OOHJDO $OLHQV HVWLPDWHf 727$/ 6RXUFH 86 ,PPLJUDWLRQ t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fGLYHUVLW\ LPPLJUDQWVf *LPSHO DQG (GZDUGV 7KH &RQJUHVVLRQDO 3ROLWLFV ,ELG

PAGE 80

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f WRJHWKHU ZLWK WKH ,PPLJUDWLRQ $FW RI 6WDWXWHVDW/DUJH f JRYHUQHG $PHULFDQ LPPLJUDWLRQ SROLF\ XQWLO $W WKH VDPH WLPH &RQJUHVV HVWDEOLVKHG WKH %RUGHU 3DWURO LQ UHVSRQVH WR WKH FRQFHUQ ZLWK LQFUHDVHG LOOHJDO PRYHPHQW DFURVV WKH ERUGHUV ZLWK &DQDGD DQG 0H[LFR ,Q WKH %UDFHUR 3URJUDP DOVR NQRZ DV WKH 0H[LFDQ )DUP /DERU 6XSSO\ 3URJUDPf ZDV EHJXQ LQ RUGHU WR DOORZ HQWU\ WR DJULFXOWXUDO ZRUNHUV RQ D WHPSRUDU\ EDVLV *LPSHO DQG (GZDUGV &RQJUHVVLRQDO 3ROLWLFV S 3HWHU + 6FKXFN 7KH 0HDQLQJ RI )DFLQJ 8S WR ,OOHJDO ,PPLJUDWLRQ 7KH $PHULFDQ 3URVSHFW 1R 6SULQJ ,PPLJUDWLRQ 5HIRUP DQG &RQWURO $FW RI 3XEOLF /DZ

PAGE 81

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
PAGE 82

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

PAGE 83

FRQGLWLRQV ,Q IDFW ODZ HQIRUFHPHQW RIILFLDOV UHSRUWHG WKDW VZHDWVKRSV RSHUDWLQJ RXWVLGH WKH ODZ LQ WKH JDUPHQW LQGXVWU\ PDGH D FRPHEDFN LQ /RV $QJHOHV DQG 1HZ
PAGE 84

ZLWKKHOG IURP ORFDO VFKRRO GLVWULFWV DQ\ VWDWH IXQGV IRU WKH HGXFDWLRQ RI DQ\ FKLOG ZKR ZDV QRW OHJDOO\ DGPLWWHG LQWR WKH 8QLWHG 6WDWHV 7KHUH WKH &RXUW KHOG WKDW D 7H[DV VWDWXWH WKDW HIIHFWLYHO\ GHQLHG XQGRFXPHQWHG FKLOGUHQ D SXEOLFVFKRRO HGXFDWLRQ YLRODWHG WKH )RXUWHHQWK $PHQGPHQWnV (TXDO 3URWHFWLRQ &ODXVH %HDULQJ WKH H[WUD H[SHQVH RI SURYLGLQJ DQ HGXFDWLRQ DQG VHUYLFHV WR XQGRFXPHQWHG FKLOGUHQ ZDV IHOW E\ 7H[DV YRWHUV WR EH H[WUHPHO\ XQIDLU LQ OLJKW RI WKH IDFW WKDW WKHVH FKLOGUHQ DQG WKHLU SDUHQWV ZHUH QRW VXSSRVHG WR EH LQ WKH VWDWH LQ WKH ILUVW SODFH 3URSRVLWLRQ 2XW RI VLPLODU IUXVWUDWLRQ RYHU WKH H[SHQVHV RI LOOHJDO LPPLJUDWLRQ WR WKH VWDWH WKH YRWHUV RI &DOLIRUQLD HQDFWHG 3URSRVLWLRQ LQ 7KH VWDWXWH ZDV D GUDPDWLF HIIRUW WR GULYH RXW XQGRFXPHQWHG DOLHQV DQG WR GHWHU WKHLU HQWU\ E\ FXWWLQJ WKHP RII IURP PHGLFDO DQG RWKHU SXEOLF VHUYLFHV DQG GHSULYLQJ WKHLU FKLOGUHQ RI DQ HGXFDWLRQ ,W ZDV GHVFULEHG LQ WKH RIILFLDO EDOORW DUJXPHQW DV fWKH ILUVW JLDQW VWULGH LQ XOWLPDWHO\ HQGLQJ WKH ,//(*$/ $/,(1 LQYDVLRQf 7KH WH[W UHDG DV IROORZV 352326,7,21 7H[W RI 3URSRVDOf $Q\ SHUVRQ ZKR PDQXIDFWXUHV GLVWULEXWHV RU VHOOV GRFXPHQWV WR FRQFHDO WKH WUXH FLWL]HQVKLS RU UHVLGHQW DOLHQ VWDWXV RI DQRWKHU SHUVRQ LV JXLOW\ RI D IHORQ\ DQG VKDOO EH SXQLVKHG E\ LPSULVRQPHQW LQ WKH VWDWH SULVRQ IRU ILYH \HDUV RU E\ D ILQH RI VHYHQW\ILYH WKRXVDQG GROODUV $Q\ SHUVRQ ZKR XVHV IDOVH GRFXPHQWV WR FRQFHDO KLV RU KHU WUXH FLWL]HQVKLS RU UHVLGHQW DOLHQ VWDWXV LV JXLOW\ RI D IHORQ\ DQG VKDOO EH SXQLVKHG E\ LPSULVRQPHQW LQ WKH VWDWH 3O\OHU 86 f ,ELG 3URSRVLWLRQ ZDV DSSURYHG E\ WKH HOHFWRUDWH RI &DOLIRUQLD RQ 1RYHPEHU DV DQ LQLWLDWLYH VWDWXWH 6HH &DO /HJLV 6HUY 3URS :HVWODZf ,ELG

PAGE 85

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nV URXJKO\ PLOOLRQ LOOHJDO UHVLGHQWV WR JR KRPH DQG H[SHO WKH UHVW 7KH PRVW FRQWURYHUVLDO SURYLVLRQV EDUUHG DQ\RQH ZKR ZDV QRW D FLWL]HQ OHJDO SHUPDQHQW UHVLGHQW JUHHQ FDUG KROGHUf RU OHJDO WHPSRUDU\ YLVLWRU IURP UHFHLYLQJ SXEOLF VRFLDO VHUYLFHV KHDOWK FDUH DQG HGXFDWLRQ 7KH SURYLVLRQV GLIIHUHG VOLJKWO\ IRU HDFK VHUYLFH EXW WKH\ JHQHUDOO\ LPSRVHG WKUHH GXWLHV RQ DOO VHUYLFH SURYLGHUV WKH YHULILFDWLRQ RI WKH LPPLJUDWLRQ VWDWXV RI DOO ZKR VRXJKW VHUYLFHV WKH SURPSW QRWLILFDWLRQ RI VWDWH RIILFLDOV DQG WKH ,16 RI DQ\RQH ZKR ZDV fGHWHUPLQHG RU UHDVRQDEO\ VXVSHFWHG WR EHf LQ YLRODWLRQ RI LPPLJUDWLRQ ODZV DQG WKH ,ELG 6FKXFN ,OOHJDO ,PPLJUDWLRQ SS

PAGE 86

QRWLILFDWLRQ RI WKH DOLHQ RU LQ WKH FDVH RI FKLOGUHQ WKHLU SDUHQW RU JXDUGLDQf RI WKHLU DSSDUHQWO\ LOOHJDO VWDWXV 3URSRVLWLRQ ZDV QR RUGLQDU\ ODZ LW SURYLGHG WKDW WKH OHJLVODWXUH FRXOG QRW DPHQG LW fH[FHSW WR IXUWKHU LWV SXUSRVHVf DQG WKHQ RQO\ E\ D UHFRUGHG VXSHUPDMRULW\ YRWH LQ HDFK KRXVH RI WKH OHJLVODWXUH RU E\ DQRWKHU YRWHU LQLWLDWLYH &DOLIRUQLDf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f H[SHQVH UHODWHG QRW RQO\ WR LOOHJDO DOLHQV DOUHDG\ KHUH EXW WR WKRVH ZKR ZRXOG FRPH LQ WKH IXWXUH 6HFRQG LW SURSRVHG WKDW HGXFDWLRQ VKRXOG EH LQ WKH SHUVRQfV KRPH FRXQWU\ 7KLUG WKH LQLWLDWLYH DGGUHVVHG WKH ILQDQFLDO SUREOHPV FDXVHG E\ SURYLGLQJ LOOHJDO LPPLJUDQWV ZLWK IUHH HGXFDWLRQ 7KH FRVWV RI HGXFDWLQJ QRQ(QJOLVK VSHDNLQJ LPPLJUDQWV ZHUH KLJKHU GXH WR WKHLU QHHG WR OHDUQ (QJOLVK 7KRPDV $ $OLHQNRII 'DYLG $ 0DUWLQ DQG +LURVKL 0RWRPXUD f ,PPLJUDWLRQ DQG &LWL]HQVKLS 3URFHVV DQG 3ROLF\ )RXUWK (GLWLRQ :HVW *URXS 6W 3DXO 0LQQ 6FKXFN ,OOHJDO ,PPLJUDWLRQ SS ,ELG

PAGE 87

7KH VWDWXWH ZDV DWWDFNHG LPPHGLDWHO\ DV XQFRQVWLWXWLRQDO LQ VHYHUDO ODZVXLWV DQG LWV RSHUDWLRQ VKDFNOHG E\ UHVWUDLQLQJ RUGHUV 2Q 'HF 86 'LVWULFW &RXUW -XGJH 0DULDQD 5 3IDHO]HU RI WKH &HQWUDO 'LVWULFW RI &DOLIRUQLD LVVXHG DQ RUDO GHFLVLRQ WR HQMRLQ WKH PDMRU SURYLVLRQV RI 3URSRVLWLRQ XQWLO WULDO &RQVWLWXWLRQDO 9LRODWLRQV %DVHG RQ -XGJH 3IDHO]HUfV VWDWHPHQW WKH ZULWWHQ GHFLVLRQRUGHU ZKHQ LVVXHG IRXQG WKDW PXFK RI WKH VWDWXWH YLRODWHG WZR RI WKH SURYLVLRQV RI WKH &RQVWLWXWLRQ f WKH 6XSUHPDF\ &ODXVH E\ VWHSSLQJ RQ JURXQG SUHHPSWHG E\ IHGHUDO LPPLJUDWLRQ ODZ DQG f WKH )RXUWHHQWK $PHQGPHQW ILUVW E\ HIIHFWLYHO\ RUGHULQJ WKH GHSRUWDWLRQ RI &DOLIRUQLD UHVLGHQWV ZLWKRXW KHDULQJV RU RWKHU GXH SURFHVV RI ODZ DQG VHFRQG E\ GHQLDO RI IUHH HGXFDWLRQ WR XQGRFXPHQWHG FKLOGUHQ WKDW $PHQGPHQWnV (TXDO 3URWHFWLRQ FODXVH 3URSRVLWLRQ SURKLELWHG SXEOLF VRFLDO VHUYLFHV WR WKRVH ZKR FRXOG QRW HVWDEOLVK WKHLU VWDWXV DV D 86 FLWL]HQ D ODZIXO SHUPDQHQW UHVLGHQW RU DQ fDOLHQ ODZIXOO\ DGPLWWHG IRU D WHPSRUDU\ SHULRG RI WLPHf 2QO\ SHUVRQV LQ WKRVH FDWHJRULHV FRXOG UHFHLYH KHDOWKn FDUH VHUYLFHV IURP D SXEOLFO\ IXQGHG KHDOWK FDUH IDFLOLW\ fRWKHU WKDQ HPHUJHQF\ PHGLFDO FDUH DV UHTXLUHG E\ IHGHUDO ODZf $Q\RQH HOVH ZDV WR EH GHQLHG WKH UHTXHVWHG VHUYLFHV RU RWKHU EHQHILWV GLUHFWHG LQ ZULWLQJ WR fHLWKHU REWDLQ OHJDO VWDWXV RU OHDYH WKH 8QLWHG f,QLWLDWLYH RQ $OLHQV 6XIIHUV ,WV %LJJHVW 6HWEDFN
PAGE 88

6WDWHVf DQG EH UHSRUWHG WR WKH DXWKRULWLHV LQFOXGLQJ WKH ,PPLJUDWLRQ DQG 1DWXUDOL]DWLRQ 6HUYLFH ,16f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fSHUPDQHQWO\ ORFNHG LQWR WKH ORZHVW VRFLRHFRQRPLF FODVVf %UHQQDQ DFNQRZOHGJHG WKDW WKH VWDWH KDG VRPH OHHZD\ LQ VXFK PDWWHUV 8QGHU HTXDOSURWHFWLRQ SULQFLSOHV LOOHJDO DOLHQ VWDWXV ZDV QRW D fVXVSHFW FODVVf OLNH UDFH RU UHOLJLRQ DQG HGXFDWLRQ ZDV QRW D fIXQGDPHQWDO ULJKWf +HQFH LW GLG QRW UHTXLUH KHLJKWHQHG MXGLFLDO VFUXWLQ\ 1HYHUWKHOHVV %UHQQDQ VDLG D ODZ WKDW GHQLHG FKLOGUHQ fWKH DELOLW\ WR OLYH ZLWKLQ WKH VWUXFWXUH RI RXU FLYLF LQVWLWXWLRQV FDQ KDUGO\ EH FRQVLGHUHG UDWLRQDO XQOHVV LW IXUWKHUV VRPH VXEVWDQWLDO JRDO RI WKH 6WDWHf %UHQQDQ FRQFHGHG WKDW NHHSLQJ LOOHJDO DOLHQV RXW RI WKH VWDWH PLJKW EH D OHJLWLPDWH VWDWH JRDO %XW WKH WULDO FRXUW IRXQG WKDW WKH 7H[DV ODZ KDG QHLWKHU WKH SXUSRVH QRU WKH 0DLOPDQ DQG ,WV /HVVRQV S FROO 3URSRVLWLRQ 6HF 0DLOPDQ DQG ,WV /HVVRQV S FROO 3O\OHU 86 f 6FKXFN ,OOHJDO ,PPLJUDWLRQ SS

PAGE 89

HIIHFW RI GRLQJ WKDW DQG %UHQQDQ DJUHHG 7KH 7H[DV ODZ PLJKW KDYH VDYHG VRPH PRQH\ DFFRUGLQJ WR %UHQQDQ EXW 7H[DV IDLOHG WR HVWDEOLVK WKDW LOOHJDO DOLHQV LPSRVHG D VLJQLILFDQW ILVFDO EXUGHQ RQ VWDWH FRIIHUV RU WKDW WKHLU H[FOXVLRQ ZRXOG LPSURYH WKH TXDOLW\ RI HGXFDWLRQ ,Q DGGLWLRQ %UHQQDQ VDLG IHGHUDO LPPLJUDWLRQ SROLF\ ZDV QRW FRQFHUQHG ZLWK FRQVHUYLQJ VWDWH HGXFDWLRQDO UHVRXUFHV PXFK OHVV ZLWK GHQ\LQJ DQ HGXFDWLRQ fWR D FKLOG HQMR\LQJ DQ LQFKRDWH IHGHUDO SHUPLVVLRQ WR UHPDLQf 7KLV UHIHUUHG WR WKH SRVVLELOLW\ WKDW DQ LOOHJDO DOLHQ PLJKW REWDLQ GLVFUHWLRQDU\ UHOLHI IURP GHSRUWDWLRQf $OO WKH 7H[DV ODZ ZRXOG VHUYH WR GR %UHQQDQ VDLG ZDV WR SURPRWH fWKH FUHDWLRQ DQG SHUSHWXDWLRQ RI D VXEFODVV RI LOOLWHUDWHVf ZKR ZRXOG EH VRFLDOO\ G\VIXQFWLRQDO DQG D EXUGHQ WR VRFLHW\ 7KDW KH VDLG FOHDUO\ ZDV QRW VRPHWKLQJ WKH VWDWHV ZHUH DOORZHG WR GR 7KH SDUDOOHOV IURP 3O\OHU WR 3URSRVLWLRQ ZHUH REYLRXV %RWK ZRXOG LQ HIIHFW EDU XQGRFXPHQWHG FKLOGUHQ IURP WKH SXEOLF VFKRROV LI DQ\WKLQJ &DOLIRUQLDnV QHZ EDQ RQ HQUROOLQJ VXFK FKLOGUHQ ZDV HYHQ PRUH FDWHJRULFDO DQG ULJLG WKDQ WKH 7H[DV VWDWXWH LQYDOLGDWHG LQ 3O\OHU $Q\ FRXUW WKDW DFFHSWHG %UHQQDQnV SUHPLVHV LQ 3O\OHU ZRXOG KDYH KDG GLIILFXOW\ VXVWDLQLQJ 3URSRVLWLRQ ,I DOLHQV UHPDLQHG LQ WKH 8QLWHG 6WDWHV SDLG WD[HV DQG EHFDPH SDUW RI WKH FRPPXQLW\ WKHLU PLVIRUWXQHV KDG WR EH GHDOW ZLWK IRU WKHLU VDNH DQG WKDW RI VRFLHW\ $ OHVVRQ IURP 3O\OHU ZDV WKDW FKLOGUHQ FRXOG QRW EH SXQLVKHG IRU HYDVLRQ RI LPPLJUDWLRQ ODZV DQG LI WKH\ ZHUH DOORZHG WR UHPDLQ KHUH WKH\ ZRXOG EH HGXFDWHG DQG RWKHUZLVH FDUHG IRUf LQ WKH JHQHUDO FRPPXQLW\ LQWHUHVW $ VHFRQG OHVVRQ ZDV WKDW DOLHQV FDPH WR ,ELG ,ELG ,ELG

PAGE 90

WKH 8QLWHG 6WDWHV SULPDULO\ WR ZRUNf§QRW IRU VFKRROV RU PHGLFDO FDUH RU RWKHU SXEOLF EHQHILWV &RQIOLFW ZLWK )HGHUDO /DZV 7KH RSLQLRQ LQ 3O\OHU EURXJKW RXW WZR FRQIOLFWLQJ WKHPHV YDULDWLRQV RI ZKLFK DSSHDUHG LQ WKH 3URSRVLWLRQ OLWLJDWLRQ )LUVW WKH XQGRFXPHQWHG VWDWXV RI DOLHQV PLJKW LWVHOI KDYH EHHQ VXIILFLHQW EDVLV IRU GHQ\LQJ JRYHUQPHQWDO EHQHILWV WKDW LW SURYLGHG WR RWKHUV +RZHYHU FRQWURO RI LPPLJUDWLRQ ZDV ZLWKLQ WKH H[FOXVLYH SXUYLHZ RI WKH IHGHUDO JRYHUQPHQW :KLOH fWKH 6WDWHV GLG KDYH VRPH DXWKRULW\ WR DFW ZLWK UHVSHFW WR LOOHJDO DOLHQV DW OHDVW ZKHUH VXFK DFWLRQ PLUURUHG IHGHUDO REMHFWLYHV DQG IXUWKHUHG D OHJLWLPDWH VWDWH JRDOf WKH GLVDELOLW\ LPSRVHG RQ WKH VWXGHQWV GLG QRW FRUUHVSRQG ZLWK fDQ\ LGHQWLILDEOH FRQJUHVVLRQDO SROLF\f DQG PRUH LPSRUWDQW WKH FODVVLILFDWLRQ RI XQGRFXPHQWHG VWXGHQWV ffGLG QRW RSHUDWH KDUPRQLRXVO\ ZLWKLQ WKH IHGHUDO SURJUDPf 7KH FRPSHOOLQJ FRQVLGHUDWLRQ IRU WKH 3O\OHU &RXUW ZDV KRZ WKH VWDWXWH KXUW LQQRFHQW FKLOGUHQ DQG VRFLHW\ 7KHVH FRQVLGHUDWLRQV ZHUH FRQFOXVLYH f,OOLWHUDF\ ZDV DQ HQGXULQJ GLVDELOLW\ 7KH LQDELOLW\ WR UHDG DQG ZULWH ZRXOG KDQGLFDS WKH LQGLYLGXDO GHSULYHG RI D EDVLF HGXFDWLRQ HDFK DQG HYHU\ GD\ RI KLV OLIH ,Q GHWHUPLQLQJ WKH UDWLRQDOLW\ RI >WKH VWDWXWH@ RQH PXVW DSSURSULDWHO\ WDNH LQWR DFFRXQW LWV FRVWV WR WKH 1DWLRQ DQG WR WKH LQQRFHQW FKLOGUHQ ZKR DUH LWV YLFWLPVf 0DLOPDQ DQG ,WV /HVVRQV S FROO 86 DW FLWLQJ 'H &DQDV Y %LFD 86 f DV FLWHG LQ 0DLOPDQ DQG ,WV /HVVRQV S FROO 86 DW &RQVWUDLQHG E\ LWV HDUOLHU KROGLQJ LQ 6DQ $QWRQLR 6FKRRO 'LVWULFW Y 5RGULJXH] 86 f WKDW HGXFDWLRQ LV QRW D fIXQGDPHQWDO ULJKWf DQG JLYHQ LWV RSLQLRQ WKDW XQGRFXPHQWHG VWDWXV LV QRW D fFRQVWLWXWLRQDO LUUHOHYDQF\f WKH &RXUW DSSOLHG DQ LQWHUPHGLDWH UDWKHU WKDQ VWULFW VFUXWLQ\ WHVW

PAGE 91

+RZ GLG 3O\OHU FRQWURO WKH FRQVWLWXWLRQDOLW\ RI 3URSRVLWLRQ )URP -XGJH 3IDHO]HUnV YHUEDO GHFLVLRQ 3O\OHU GLUHFWO\ DIIHFWHG RQO\ WKRVH ZKR VRXJKW WR HQWHU RU UHPDLQ LQ HOHPHQWDU\ RU VHFRQGDU\ VFKRROV WKRVH LQ WKH XQLYHUVLW\ V\VWHP ZRXOG QRW EH SURWHFWHG +RZHYHU HOHPHQWV RI 3O\OHU ZHUH EURXJKW LQWR D PRUH JHQHUDO FRQVWLWXWLRQDO DWWDFN RQ 3URSRVLWLRQ UHODWLQJ WR WKH VXSUHPDF\ RI IHGHUDO OHJLVODWLRQ RYHU WKH VXEMHFW RI LPPLJUDWLRQ &RQJUHVV XQTXHVWLRQDEO\ KDG DXWKRULW\ WR OHJLVODWH RQ LPPLJUDWLRQ DQG KDG H[HUFLVHG WKDW SRZHU FRPSUHKHQVLYHO\ LQ fUHJXODWLQJ DXWKRUL]HG HQWU\ OHQJWK RI VWD\ UHVLGHQFH VWDWXV DQG GHSRUWDWLRQf DQG LQ WKH WUHDWPHQW RI DOLHQV RWKHUZLVH ,Q GHILQLQJ ZKR UHFHLYHG EHQHILWV &RQJUHVV KDG SRVLWLRQHG LPPLJUDWLRQ FODVVLILFDWLRQV LQWR WKH IUDPHZRUN RI YDULRXV SXEOLF DVVLVWDQFH SURJUDPV $GGLWLRQDOO\ XQGHU 3URSRVLWLRQ IURQWOLQH XQWUDLQHG VWDWH HPSOR\HHV GHFLGHG ZKR fKDG DSSDUHQW LOOHJDO VWDWXVf RU ZDV KHUH fLQ YLRODWLRQ RI ODZf DQG WKHUHIRUH LQHOLJLEOH IRU EHQHILWV 7KRVH ZKR FRQYH\HG WKH EDG QHZV ZHUH GHSXWL]HG WR GLUHFW WKH DSSOLFDQW WR OHDYH WKH FRXQWU\ HIIHFWLYHO\ WR LVVXH ZKDW FRXOG KDYH HDVLO\ EHHQ WDNHQ DV D GHSRUWDWLRQ RUGHU
PAGE 92

VWD\ LQ WKH 8QLWHG 6WDWHV DQG PDQ\ DOLHQV DOWKRXJK GHSRUWDEOH FRXOG KDYH EHHQ JUDQWHG GLVFUHWLRQDU\ UHOLHI WKDW DOORZHG WKHP WR UHPDLQ +HUH WRR WKH &DOLIRUQLD VWDWXWH FRQIOLFWHG ZLWK IHGHUDO OHJLVODWLRQ 'XH 3URFHVV 3ODLQWLIIV DOVR DUJXHG WKDW 3URSRVLWLRQ nV SURFHGXUH YLRODWHG WKH )RXUWHHQWK $PHQGPHQWnV 'XH 3URFHVV FODXVH E\ WKUHDWHQLQJ WR WDNH DZD\ YDOXDEOH ULJKWV RU LQWHUHVWV ZLWKRXW D SULRU KHDULQJ 3XEOLF DVVLVWDQFH IRU H[DPSOH ZDV DQ LQWHUHVW WKDW FRXOG QRW EH FXW RII ZLWKRXW D SUHWHUPLQDWLRQ KHDULQJ 'XH SURFHVV DOVR UHTXLUHG D KHDULQJ EHIRUH D GHSRUWDWLRQ RUGHU FRXOG EH HQWHUHG 3URSRVLWLRQ WKHUHIRUH YLRODWHG WKH &RQVWLWXWLRQ ZKHQ LW LQVWUXFWHG VWDWH HPSOR\HHV WR WHUPLQDWH D ZRPDQnV SUHQDWDO FDUH RU WXUQ D FKLOG RXW RI VFKRRO DQG WKHQ GLUHFWHG WKH SDUWLHV WR OHDYH WKH 8QLWHG 6WDWHV f§ ZLWKRXW D KHDULQJ RU RWKHU PHDQV RI HYDOXDWLQJ WKHLU ULJKWV 7KH VDPH HTXDO SURWHFWLRQ VXSUHPDF\ DQG GXH SURFHVV SURYLVLRQV WKDW FRQWUROOHG 3URSRVLWLRQ FKDOOHQJHG RWKHU VWDWHV DV WKH\ FRQVLGHUHG ZKDW WR GR DERXW XQGRFXPHQWHG DOLHQV $QG D VWDWH ODZ PXVW DOVR KDYH SDVVHG PXVWHU XQGHU LWV RZQ FRQVWLWXWLRQ )RU H[DPSOH D SURYLVLRQ RI 1HZ
PAGE 93

ZKRP LW KDV FODVVLILHG DV QHHG\f 8QGHU &DOLIRUQLDnV RZQ HTXDO SURWHFWLRQ SURYLVLRQ HGXFDWLRQ ZDV WUHDWHG DV D PDWWHU RI fIXQGDPHQWDO LQWHUHVWf ZKRVH fXQLTXH LPSRUWDQFH LQ &DOLIRUQLDnV FRQVWLWXWLRQDO VFKHPH UHTXLUHG FDUHIXO VFUXWLQ\ RI VWDWH LQWHUIHUHQFH ZLWK EDVLF HGXFDWLRQDO ULJKWVf 7KDW ZDV ZK\ VRPH &DOLIRUQLD SODLQWLIIV DWWDFNHG 3URSRVLWLRQ LQ WKHLU VWDWH FRXUW XUJLQJ WKH 3O\OHU DQDO\VLV 3URSRVLWLRQ OLNH WKH f2IILFLDO (QJOLVKf ODZV DSSURYHG LQ &DOLIRUQLD DQG HOVHZKHUH VLQFH WKH PLGV ZDV D V\PEROLF PHVVDJH WR SROLF\ HOLWHV 7KHVH PHDVXUHV ZHUH JUDQG JHVWXUHV ZLWK IHZ SUDFWLFDO FRQVHTXHQFHV RWKHU WKDQ WR FRQYLQFH SROLWLFLDQV WKDW PDQ\ YRWHUV YLHZHG $PHULFDQ VRFLHW\ DV LQFUHDVLQJO\ DOLHQ OLWHUDOO\f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f2YHU QR FRQFHLYDEOH VXEMHFW LV WKH OHJLVODWLYH SRZHU RI &RQJUHVV PRUH FRPSOHWHf 6HH 1HZ
PAGE 94

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f &I 'H&DQDV Y %LFD 86 f ,ELG

PAGE 95

VFKRROV WR YHULI\ WKH OHJDO VWDWXV RI DOO VWXGHQWV RYHU \HDUV RI DJH HQUROOHG LQ (QJOLVK DV D 6HFRQG /DQJXDJH SURJUDPV DQG RI DOO VWXGHQWV RYHU ZKR HQWHUHG WKH 86 DIWHU WKH DJH RI RU ULVN ORVLQJ VRPH VWDWH IXQGLQJ $Q LQLWLDWLYH VLPLODU WR 3URSRVLWLRQ ZDV SURSRVHG E\ 5HS (OWRQ *DOOHJO\ DV DQ DPHQGPHQW WR WKH RPQLEXV LPPLJUDWLRQ UHIRUP ELOO +5 f LQ 7KH DPHQGPHQW DWWHPSWHG WR FRPELQH WZR HQWLUHO\ GLIIHUHQW LVVXHV LQWR RQH ELOO -RLQLQJ HIIRUWV WR VHFXUH RXU ERUGHUV ZLWK UHIRUPV WR RXU V\VWHP RI OHJDO LPPLJUDWLRQ VHUYHG RQO\ WR FRQIXVH WKH GHEDWH ,W SOD\HG RQ WKH SXEOLFfV XQGHUVWDQGDEOH FRQFHUQ RYHU LOOHJDO LPPLJUDWLRQ EXW WZLVWHG WKDW FRQFHUQ LQWR WKH PLVJXLGHG QRWLRQ WKDW DOO LPPLJUDWLRQ ZDV KDUPIXO DQG DOO LPPLJUDQWV ZHUH XQGRFXPHQWHG VQHDNLQJ LQWR RXU FRXQWU\ E\ QLJKW 1HLWKHU QRWLRQ RI FRXUVH ZDV WUXH EXW GHDOLQJ ZLWK LOOHJDO DQG OHJDO LPPLJUDWLRQ LQ RQH ELOO VHUYHG WR IXHO KRVWLOLW\ DQG HYHQ SUHMXGLFH WRZDUG DOO LPPLJUDQWV 7KH DPHQGPHQW ZRXOG KDYH DXWKRUL]HG VWDWHV WR GHQ\ SXEOLF HGXFDWLRQ WR WKH FKLOGUHQ RI LOOHJDO DOLHQV ,W ZRXOG KDYH GHQLHG $PHULFDQ FLWL]HQV DQG OHJDO SHUPDQHQW UHVLGHQWV WKH RSSRUWXQLW\ WR EULQJ FORVH UHODWLYHV LQWR WKH 8QLWHG 6WDWHV +5 ZRXOG DOVR KDYH LQFUHDVHG WKH LQFRPH D IDPLO\ QHHGHG WR EULQJ D IDPLO\ PHPEHU XS WR D OHYHO WKDW GHQLHG SHUFHQW RI $PHULFDQV WKH FKDQFH WR UHXQLWH ZLWK ORYHG RQHV 7KH SURYLVLRQ ZDV SDVVHG E\ WKH IXOO +RXVH RI 5HSUHVHQWDWLYHV EXW ZDV HOLPLQDWHG E\ WKH FRQIHUHQFH FRPPLWWHHf§EHFDXVH QR YRWH KDG EHHQ WDNHQ LQ WKH 6HQDWH RQ WKLV LVVXH %XW WKH PHDVXUH ZDV DJDLQ SDVVHG DV D ,ELG &KDUOHV /HYHQGRVN\ 7KH 3ROLWLFV RI 7XUQLQJ &KLOGUHQ LQWR 9LFWLPV &DVSHU :YRf 6WDU 7ULEXQH 0D\ *LPSHO DQG (GZDUGV ,PPLJUDWLRQ 5HIRUP 6HUUDQR +RXVH RI 5HSUHVHQWDWLYHV WKRPDVORFJRYFJLELQTXHU\'"UOWHPS!

PAGE 96

VHSDUDWH ELOO LQ WKH +RXVH 2QH YHUVLRQ RI WKH SURSRVDO ZRXOG KDYH GHQLHG SXEOLF HGXFDWLRQ WR FKLOGUHQ ZKR ZHUH LOOHJDO DOLHQV WKHPVHOYHV UDWKHU WKDQ DOO FKLOGUHQ RI LOOHJDO DOLHQV ZKLFK ZRXOG KDYH LQFOXGHG VRPH 86 ERP FLWL]HQ FKLOGUHQf 7KH ELOO IDLOHG WR DGGUHVV WKH IDFW WKDW HPSOR\PHQW ZDV WKH SULPDU\ UHDVRQ LPPLJUDQWV ZKHWKHU OHJDO RU LOOHJDO FDPH WR WKLV FRXQWU\ 6XSSRUWHUV RI WKH *DOOHJO\ $PHQGPHQW DUJXHG WKDW $PHULFDnV HGXFDWLRQ V\VWHP OLNH RWKHU VRFLDOVHUYLFH SURJUDPV DWWUDFWHG D GLVSURSRUWLRQDWH QXPEHU RI LPPLJUDQWV DQG WKDW WKH FRVW RI HGXFDWLQJ VXFK FKLOGUHQ ZDV WRR KLJK LQ DQ HUD RI WLJKW VFKRRO EXGJHWV 2SSRQHQWV RI WKH PHDVXUH GHQRXQFHG LW DV FUXHO KXQGUHGV RI WKRXVDQGV RI FKLOGUHQ ZRXOG SRWHQWLDOO\ EH WXUQHG DZD\ DW WKH VFKRROKRXVH GRRU $ SRUWLRQ RI WKH *DOOHJO\ DPHQGPHQW UHDG f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f7KH 3ROLWLFV RI 7XUQLQJ &KLOGUHQ LQWR 9LFWLPVf &DVSHU :?Rf 6WDU 7ULEXQH 0D\ *LPSHO -DPHV DQG (GZDUGV -DPHV 5 -U 7KH &RQJUHVVLRQDO 3ROLWLFV RI ,PPLJUDWLRQ 5HIRUP 1HHGKDP +HLJKWV 0$ $OO\Q t %DFRQ f,OOHJDO ,PPLJUDQW &KLOGUHQ ,Q RU 2XW RI 3XEOLF 6FKRROV"f (GXFDWLRQ :HHN $SULO ZZZFGZHHNRUJFRQWH[WHOHFWLRQLPPL JKWP! *DOOHJO\ $PHQGPHQW + 5 f

PAGE 97

HGXFDWHG DOO WKH FKLOGUHQ ZKR FDPH WKURXJK WKHLU GRRUV 7KH *DOOHJO\ SURYLVLRQ ZRXOG KDYH WXUQHG WHDFKHUV DQG VFKRRO DGPLQLVWUDWRUV LQWR VXEVWLWXWH ,16 RIILFHUV $GGLQJ D QHZ GLPHQVLRQ WR WKH LVVXH ZDV WKH 1RUWK $PHULFDQ )UHH 7UDGH $JUHHPHQW 1$)7$f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fGLIIHUHQFHf VXVWDLQHG WKRVH $PHULFDQV VWLOO FRQILGHQW DERXW RXU DVVLPLODWLYH FDSDFLW\f§VRPH RI ZKLFK PLVWDNHQO\ DVVXPHG WKDW PDVV LPPLJUDWLRQ ZDV D FRQVWDQW KLVWRULFDO IL[WXUH RI $PHULFDQ VRFLHW\ $V WKH LQIOX[ RI LPPLJUDQWV FRQWLQXHG DQG WKH QXPEHU RI LPPLJUDQW FKLOGUHQ HQUROOHG LQ WKH SXEOLF HGXFDWLRQ V\VWHP JUHZ VFKRRO V\VWHPV H[SDQGHG DORQJ ZLWK WKHP 6WDWLVWLFV VKRZHG WKDW LQ VSLWH RI WKH PDQ\ REVWDFOHV LPPLJUDQW FKLOGUHQ RYHUFDPH DV QHZ VWXGHQWV LQ D QHZ FRXQWU\ WKH\ SHUVHYHUHG DQG VRPH GLG DV ZHOO LI QRW EHWWHU WKDQ &KDUOHV /HYHQGRVN\ f7KH 3ROLWLFV RI 7XUQLQJ &KLOGUHQ LQWR 9LFWLPVf &DVSHU :?Rf 6WDU 7ULEXQH 0D\ 1RUWK $PHULFDQ )UHH 7UDGH $JUHHPHQW $XJXVW

PAGE 98

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n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nV UDWLRQDOH 3ROLWLFDO OHDGHUV QHHGHG WR UHFRJQL]H WKDW LOOHJDO LPPLJUDWLRQ ZDV QRW DQ XQPLWLJDWHG HYLO DQG WKDW LPPLJUDWLRQ HQIRUFHPHQW FRPSHWHG IRU UHVRXUFHV ZLWK RWKHU 6FKXFN ,OOHJDO ,PPLJUDWLRQ SS ,ELG ,ELG ,ELG

PAGE 99

VRFLDO JRDOV $OWKRXJK LW ZDV KDUG WR DGPLW WKDW WKH 86 WROHUDWHG VRPH ODZEUHDNHUV DV D PDWWHU RI SROLF\ WKH IDFW ZDV WKDW LW GLGf§DQG DOZD\V ZRXOG 7KH 86 ZDV D ODUJH FRXQWU\ ZLWK UHODWLYHO\ ORZ SRSXODWLRQ GHQVLWLHV HYHQ LQ WKH FLWLHV DQG ZLWK D YDVW HFRQRP\ WKDW QHHGHG PRUH XQVNLOOHG ODERU WKDQ 86 QDWLRQDOV ZHUH ZLOOLQJ WR VXSSO\ DW H[LVWLQJ ZDJH OHYHOV ,W FRQWLQXHG WR DVVLPLODWH D VLJQLILFDQW QXPEHU RI LOOHJDO DOLHQV VR ORQJ DV WKH FRVWV ZHUH QRW WRR KLJK RU WRR ORFDOL]HG ,I WKH HQIRUFHPHQW SROLF\ fDOORZHGf LOOHJDO DOLHQV WR HQWHU DQG UHPDLQ ORQJWHUP EXW LOOHJDOf UHVLGHQWV WKHQ %UHQQDQ ZDV VXUHO\ ULJKW WKHUH ZDV OLWWOH SRLQW DQG HYHQ OHVV MXVWLFH LQ FRQVLJQLQJ WKHP WR OLYHV RI LJQRUDQFH GHSHQGHQF\ DQG GLVFULPLQDWLRQ E\ GHQ\LQJ WKHP HGXFDWLRQf§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fV IHGHUDOO\ PDQGDWHG VHUYLFHV %HFDXVH RI WKH JRYHUQPHQWnV LQDELOLW\ WR FRQWURO HIIHFWLYHO\ WKH IORZ RI LOOHJDO ,ELG ,ELG

PAGE 100

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fV JHRJUDSKLFDO SRVLWLRQ LW DWWUDFWHG D GLVSURSRUWLRQDWH QXPEHU RI OHJDO DV ZHOO DV LOOHJDO LPPLJUDQWV )ORULGD ZDV WKH VWDWH ZLWK WKH IRXUWK ODUJHVW LOOHJDO LPPLJUDQW SRSXODWLRQ EHKLQG &DOLIRUQLD 1HZ
PAGE 101

)ORULGD VXHG WKH IHGHUDO JRYHUQPHQW LQ VD\LQJ LW KDG IDLOHG WR SURWHFW WKH VWDWH IURP D fPDVVLYH DQG XQFRQWUROOHG LQIOX[ RI DOLHQVf DQG KDG FRHUFHG WKH VWDWH LQWR SD\LQJ WKH FRVW RI QDWLRQDO LPPLJUDWLRQ SROLF\ )ORULGD ORVW WKH 6XSUHPH &RXUW DSSHDO LQWHQGHG WR LPSURYH IHGHUDO HQIRUFHPHQW RI LPPLJUDWLRQ ODZV RU UHSD\ WKH VWDWHnV FRVW RI SURYLGLQJ VRFLDO VHUYLFHV DQG HGXFDWLRQ WR LOOHJDO DOLHQV 7KH FRXUW ZLWKRXW FRPPHQW UHIXVHG WR UHYLYH WKH VWDWHnV FODLP WKDW WKH IHGHUDO JRYHUQPHQW KDG YLRODWHG LWV GXW\ WR SROLFH WKH QDWLRQnV ERUGHUV )ORULGD PDLQWDLQHG WKDW WKH IHGHUDO JRYHUQPHQW KDG D fSROLF\ RI DFFRPPRGDWLQJ LOOHJDO LPPLJUDWLRQf WKDW FRVW WKH VWDWH KXQGUHGV RI PLOOLRQV RI GROODUV LQ H[WUD H[SHQVHV HDFK \HDU IRU HGXFDWLRQ PHGLFDO FDUH DQG ODZ HQIRUFHPHQW 6WDWH RIILFLDOV HVWLPDWHG WKDW )ORULGD KDG VSHQW ELOOLRQ RQ XQGRFXPHQWHG DOLHQV ZKLOH WKH IHGHUDO JRYHUQPHQW FROOHFWHG DOPRVW ELOOLRQ D \HDU LQ WD[HV IURP VXFK DOLHQV 7KH VWDWH VXHG WKH IHGHUDO JRYHUQPHQW LQ VD\LQJ LW KDG IDLOHG WR SURWHFW )ORULGD IURP D fPDVVLYH DQG XQFRQWUROOHG LQIOX[ RI DOLHQVf DQG FRHUFHG WKH VWDWH LQWR SD\LQJ WKH FRVW RI QDWLRQDO LPPLJUDWLRQ SROLF\ 7KH ODZVXLW FODLPHG WKH JRYHUQPHQW KDG YLRODWHG LPPLJUDWLRQ ODZ DQG WKH &RQVWLWXWLRQnV WK $PHQGPHQW ZKLFK UHVHUYHG FHUWDLQ SRZHUV WR WKH VWDWHV 7KH ODZVXLW DOVR FLWHG WKH &RQVWLWXWLRQnV SURPLVH WKDW WKH IHGHUDO JRYHUQPHQW ZRXOG SURWHFW VWDWHV DJDLQVW LQYDVLRQV /DXULH $VVHR )ORULGD :RQfW %H &RPSHQVDWHG )RU ,OOHJDO ,PPLJUDWLRQ 0D\ ZZZXVDORGDYFRPQHZVFRXUW! ,ELG ,ELG )ORULGD :RQfW %H &RPSHQVDWHG )RU ,OOHJDO ,PPLJUDWLRQ ZZZXVDWRGDYFRPQHZVFRXUW!

PAGE 102

$ IHGHUDO MXGJH GLVSRVHG RI WKH ODZVXLW DQG WKH WK 86 &LUFXLW &RXUW RI $SSHDOV XSKHOG WKH GLVPLVVDO 7KH DSSHDOV FRXUW UXOHG WKDW )HGHUDO LPPLJUDWLRQ ODZ DOORZHG WKH DWWRUQH\ JHQHUDO WR GHFLGH KRZ LW ZDV HQIRUFHG DGGLQJ WKDW )ORULGDnV RWKHU FODLPV ZHUH SROLWLFDO TXHVWLRQV WKDW FRXOG QRW EH GHFLGHG E\ FRXUWV ,Q WKH DSSHDO )ORULGD $WWRUQH\ *HQHUDO 5REHUW $ %XWWHUZRUWK VDLG f,I WKH QDWLRQDO JRYHUQPHQW FKRVH WR HQIRUFH WKH LPPLJUDWLRQ ODZV )ORULGDnV H[SHQGLWXUHV IRU HGXFDWLRQ DQG ODZ HQIRUFHPHQW RQ EHKDOI RI LWV DOLHQ SRSXODWLRQ ZRXOG QRW EH LR QHFHVVDU\f )LYH RWKHU VWDWHV 1HZ V OfIf )6@ &RPSXOVRU\ 6FKRRO $WWHQGDQFH ,ELG

PAGE 103

EDVHG XSRQ WKHLU LPPLJUDWLRQ VWDWXV DQG QR GLVWULFW FRXOG LQTXLUH LQWR D VWXGHQW RU SDUHQWVf LPPLJUDWLRQ VWDWXV ,Q VSLWH RI WKH UDSLG JURZWK LQ WKH QXPEHUV RI QRQ(QJOLVK ODQJXDJH EDFNJURXQG VWXGHQWV EHJLQQLQJ ZLWK WKH GHFDGH RI WKH V LW ZDV QRW XQWLO WKDW SROLFLHV ZHUH HVWDEOLVKHG ZLWK UHJDUG WR /LPLWHG (QJOLVK 3URILFLHQW /(3f VWXGHQW DFFHVV WR HGXFDWLRQDO RSSRUWXQLWLHV 5DWKHU WKDQ IDFH SRWHQWLDOO\ SURWUDFWHG FRVWO\ OLWLJDWLRQ UHVXOWLQJ IURP D FODVV DFWLRQ VXLW RQ EHKDOI RI QRQ(QJOLVK ODQJXDJH EDFNJURXQG VWXGHQWV WKH VWDWH HQWHUHG LQWR D &RQVHQW 'HFUHH WR HQVXUH HTXLWDEOH HGXFDWLRQDO RSSRUWXQLWLHV IRU )ORULGDf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fV GLVWULFWV KDG LQFUHDVHG QXPEHUV RI LGHQWLILHG (QJOLVK ODQJXDJH GHILFLHQW VWXGHQWV OO&RQVHQW 'HFUHH >V )6@ 1RQUHVLGHQW 7XLWLRQ )HH /HDJXH RI 8QLWHG /DWLQ $PHULFDQ &LWL]HQV /8/$&f HW DO Y WKH 6WDWH %RDUG RI (GXFDWLRQ HW DO &RQVHQW 'HFUHH 86 'LVWULFW &RXUW IRU WKH 6RXWKHUQ 'LVWULFW RI )ORULGD $XJXVW 6DQGUD + )UDGG DQG 2NKHH /HH f &UHDWLQJ )ORULGDnV 0XOWLOLQJXDO *OREDO :RUNIRUFH 7DOODKDVVHH )/ )ORULGD 'HSDUWPHQW RI (GXFDWLRQ )ORULGD 0DQDJHPHQW (GXFDWLRQ 6HUYLFHV f &XUUHQW \HDU VWXGHQW GDWD E\ GLVWULFW 7DOODKDVVHH )/ )ORULGD 'HSDUWPHQW RI (GXFDWLRQ )ORULGD 'HSDUWPHQW RI (GXFDWLRQ Df DQQXDO VWDWXV UHSRUW RQ WKH LPSOHPHQWDWLRQ RI WKH /HDJXH RI 8QLWHG /DWLQ $PHULFDQ &LWL]HQV /8/$&f HW DO Y 6WDWH %RDUG RI (GXFDWLRQ &RQVHQW 'HFUHH 7DOODKDVVHH )/ 2IILFH RI 0XOWLFXOWXUDO 6WXGHQW /DQJXDJH (GXFDWLRQ

PAGE 104

)ORULGD 6FKRRO /DZV 5HJXODU VFKRRO DWWHQGDQFH UHTXLUHG EHWZHHQ DJHV RI DQG SHUPLWWHG DW DJH RI H[FHSWLRQV f§ OfDf $OO FKLOGUHQ ZKR KDYH DWWDLQHG WKH DJH RI \HDUV RU ZKR ZLOO KDYH DWWDLQHG WKH DJH RI \HDUV E\ )HEUXDU\ RI DQ\ VFKRRO \HDU RU ZKR DUH ROGHU WKDQ \HDUV RI DJH EXW ZKR KDYH QRW DWWDLQHG WKH DJH RI \HDUV H[FHSW DV KHUHLQDIWHU SURYLGHG DUH UHTXLUHG WR DWWHQG VFKRRO UHJXODUO\ GXULQJ WKH HQWLUH VFKRRO WHUP If +RPHOHVV FKLOGUHQ DV GHILQHG LQ V PXVW KDYH DFFHVV WR D IUHH SXEOLF HGXFDWLRQ DQG PXVW EH DGPLWWHG WR VFKRRO LQ WKH VFKRRO GLVWULFW LQ ZKLFK WKH\ DQG WKHLU IDPLOLHV OLYH 6FKRRO GLVWULFWV VKDOO DVVLVW KRPHOHVV FKLOGUHQ WR PHHW WKH UHTXLUHPHQWV RI i DQG DV ZHOO DV ORFDO UHTXLUHPHQWV IRU GRFXPHQWDWLRQ 'LVWULFWV ZHUH SURKLELWHG IURP UHTXLULQJ HYLGHQFH RI 8QLWHG 6WDWHV FLWL]HQVKLS IRU HQUROOPHQW 6FKRRO SHUVRQQHO HQUROOHG VWXGHQWV LQ VFKRRO HYHQ WKRXJK WKH\ PD\ QRW KDYH HQWHUHG WKH 8QLWHG 6WDWHV OHJDOO\ ,Q DFFRUGDQFH ZLWK ODZ 3O\OHU Y 'RH 86 6XSUHPH &RXUWf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f(QUROOPHQW RI IRUHLJQERUQ DQG /(3 VWXGHQWVf )ORULGD '2(

PAGE 105

FKDUJHG WR SXSLOV ZKR ZHUH KRPHOHVV SXSLOV ZKRVH SDUHQWV ZHUH LQ WKH PLOLWDU\ ZRUNHG f f f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fV UHFRUGV ,Q )ORULGD WKH LOOHJDO LPPLJUDQWV HVWLPDWHG WR EH LQ WKH VWDWH LQ FRVW PLOOLRQ PRUH WKDQ WKHLU WD[ FRQWULEXWLRQV 3XEOLF HGXFDWLRQ LQFOXGLQJ ELOLQJXDO DGXOW DQG FRPSHQVDWRU\ HGXFDWLRQ LQ ZDV SHUFHQW RI DOO GLUHFW RXWOD\V IRU LPPLJUDQWV /RFDO JRYHUQPHQW VHUYLFHV LQFOXGLQJ LQGLJHQW PHGLFDO FDUH PHQWDO KHDOWK DQG IDPLO\ DQG FKLOG ZHOIDUH VHUYLFHV DFFRXQWHG IRU SHUFHQW RI LPPLJUDQW FRVWV 6RFLDO 6HFXULW\ RXWOD\V ZHUH SXW DW SHUFHQW 7KH WKUHH IRUHJRLQJ SURJUDPV WRJHWKHU &RQVHQW 'HFUHH >V Off )6@ 1RQUHVLGHQW 7XLWLRQ )HH 7KH (PHUJHQF\ ,PPLJUDQW (GXFDWLRQ $FW (,($f 7LWOH ,9 SDUW RI WKH (OHPHQWDU\ DQG 6HFRQGDU\ (GXFDWLRQ $FW DV DPHQGHG 86& f &RQVHQW 'HFUHH >V )6@ 1RQUHVLGHQW 7XLWLRQ )HH ,ELG :KDW GRHV LPPLJUDWLRQ FRVW )ORULGD HDFK \HDU" ZZZFDL7YLQJFDSDFLWYRUJ+XGGOH)ORULGDKWP!

PAGE 106

ZLWK 0HGLFDLG SHUFHQWf DQG FULPLQDO MXVWLFHFRUUHFWLRQV SHUFHQWf DFFRXQWHG IRU RYHU SHUFHQW RI WRWDO GLUHFW RXWOD\V IRU LPPLJUDQWV LQ )ORULGD DW WKDW WLPH 5HVHDUFKHUV IRU 7KH 8UEDQ ,QVWLWXWH HVWLPDWHG WKH )ORULGDfV QRQFLWL]HQ SRSXODWLRQ DW SHUFHQW RI VWDWHfV SRSXODWLRQf ZKLFK UDQNHG IRXUWK EHKLQG &DOLIRUQLD 1HZ
PAGE 107

$V D UHVXOW WKH SRWHQWLDO VWUHQJWKV DQG RSSRUWXQLWLHV WKHVH VWXGHQWV UHSUHVHQWHG VRPHWLPHV ZHQW XQUHFRJQL]HG )ORULGD IDFHG WKUHH GLIIHUHQW W\SHV RI FKDOOHQJHV LQ HGXFDWLQJ /(3V Df WKH QHHG IRU HIIHFWLYH SHUVRQQHO WR IXOO\ LPSOHPHQW HGXFDWLRQDO SROLFLHV Ef D FRPPLWPHQW WR HTXLW\ LQ DFKLHYLQJ DFDGHPLF H[FHOOHQFH DQG Ff OHDGHUVKLS LQ FUHDWLQJ D XQLILHG YLVLRQ RI HGXFDWLRQDO RXWFRPHV :LWK LQFUHDVHG LQWHUQDWLRQDO WUDGH DQG DQ H[SDQGLQJ JOREDO PDUNHW WKH SUHVHQFH RI /(3V FRQWLQXHG WR JURZ VWDWHZLGH ,W ZDV QHFHVVDU\ WR ILQG D ZD\ WR UHFRJQL]H WKH RSSRUWXQLWLHV DQG FKDOOHQJHV RI HGXFDWLQJ WKH /(3 VWXGHQWV DQG WR SURPRWH HGXFDWLRQDO UHIRUP WR WKH PDQ\ DUHDV RI WKH VWDWHf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fV 0XOWLOLQJXDO *OREDO :RUNIRUFH ,ELG

PAGE 108

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fV GLOHPPD WKHQ ZLWK WKH ULVLQJ QXPEHUV RI LPPLJUDQWV DQG WKH PLQRU VXSSRUW LW UHFHLYHG LQ VHUYLFHV DQG IXQGLQJ IURP WKH IHGHUDO JRYHUQPHQW ZDV KRZ WR FRQWLQXH WR SURYLGH WKH QHHGHG VHUYLFHV LQFOXGLQJ HGXFDWLRQ WR WKHVH LPPLJUDQW FKLOGUHQ DQG WKHLU IDPLOLHV 3O\OHU 86 f 3URSRVLWLRQ ,ELG

PAGE 109

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fHVWDEOLVK DQG PDLQWDLQ D V\VWHP RI IUHH SXEOLF VFKRROV ZKHUHLQ DOO WKH FKLOGUHQ RI WKH VWDWH PD\ EH HGXFDWHGf (GXFDWLRQDO SUDFWLFHV HYHQ WKRXJK D VWDWH IXQFWLRQ FRQIRUPHG WR WKH SULQFLSOHV RI WKH )RXUWHHQWK $PHQGPHQW ,Q DOO ILIW\ VWDWH FRQVWLWXWLRQV WKH OHJLVODWXUH ZDV JLYHQ WKH UHVSRQVLELOLW\ WR GHWHUPLQH SROLF\ 7KH VWDWH

PAGE 110

WKHUHIRUH UHWDLQHG GLVFUHWLRQDU\ SRZHU RYHU WKH FROOHFWLRQ PHWKRG DQG GLVWULEXWLRQ RI HGXFDWLRQDO IXQGV ,W GHOHJDWHG WR ORFDO VFKRRO GLVWULFWV WR DFW RQ LWV EHKDOI 3ROLWLFLDQV VWDWHVf DWWRUQH\V JHQHUDO DQG VFKRODUV KDYH GHEDWHG DW OHQJWK WKH YHU\ VRYHUHLJQW\ RI IHGHUDO ODZ LQ LWV SURYLVLRQ IRU SXEOLF HGXFDWLRQ WR LOOHJDO UHVLGHQWV 7KH LVVXH UDLVHG VWDWHVn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
PAGE 111

RQ WKH EDVLV RI UDFH FRORU RU QDWLRQDO RULJLQ LQ LQVWLWXWLRQV ZLWK IHGHUDOO\ DVVLVWHG SURJUDPV 7KH &RXUW KHOG WKDW JLYLQJ VWXGHQWV WKH VDPH WH[WERRNV WHDFKHUV DQG FXUULFXOXP GLG QRW SURYLGH HTXDO RSSRUWXQLWLHV )XUWKHU UHTXLULQJ FKLOGUHQ WR DFTXLUH (QJOLVK VNLOOV RQ WKHLU RZQ EHIRUH WKH\ FRXOG KRSH WR PDNH DQ\ SURJUHVV LQ VFKRRO PDGH fD PRFNHU\ RI SXEOLF HGXFDWLRQf (PSKDVL]LQJ WKDW fEDVLF (QJOLVK VNLOOV ZHUH DW WKH YHU\ FRUH RI ZKDW WKHVH SXEOLF VFKRROV WHDFKf WKH &RXUW FRQFOXGHG fVWXGHQWV ZKR GLG QRW XQGHUVWDQG (QJOLVK ZHUH HIIHFWLYHO\ IRUHFORVHG IURP DQ\ PHDQLQJIXO HGXFDWLRQf ,Q D QXPEHU RI VXEVHTXHQW FDVHV WKH FRXUWV FRQVLVWHQWO\ UXOHG WKDW (QJOLVK GHILFLHQW VWXGHQWV ZHUH HQWLWOHG WR VSHFLDO DVVLVWDQFH LQ SXEOLF VFKRROV 7KH IHGHUDO (TXDO (GXFDWLRQDO 2SSRUWXQLWLHV $FW ((2$f RI SURYLGHG WKDW QR VWDWH FRXOG GHQ\ HTXDO HGXFDWLRQDO RSSRUWXQLW\ WR DQ LQGLYLGXDO RQ DFFRXQW RI KLV RU KHU UDFH FRORU VH[ RU QDWLRQDO RULJLQ ,W DGGLWLRQDOO\ UHTXLUHG HDFK SXEOLF VFKRRO V\VWHP WR GHYHORS DSSURSULDWH SURJUDPV fWR RYHUFRPH ODQJXDJH EDUULHUV WKDW LPSHGHG HTXDO SDUWLFLSDWLRQ E\ LWV VWXGHQWV LQ LWV LQVWUXFWLRQDO SURJUDPf :KLOH ((2$ VWLSXODWHG WKDW VFKRRO GLVWULFWV PXVW SURYLGH DSSURSULDWH DVVLVWDQFH IRU VWXGHQWV ZLWK (QJOLVK GHILFLHQFLHV LW GLG QRW UHTXLUH WKDW VXFK DVVLVWDQFH EH LQ WKH IRUP RI ELOLQJXDOELFXOWXUDO HGXFDWLRQ %DVHG RQ WKHVH GHFLVLRQV VFKRRO GLVWULFWV FRXOG VDWLVI\ OHJDO UHTXLUHPHQWV E\ SURYLGLQJ UHPHGLDO (QJOLVK LQVWUXFWLRQ UDWKHU WKDQ ELOLQJXDO SURJUDPV /DX Y 1LFKROV 86 S ,ELG (TXDO (GXFDWLRQ 2SSRUWXQLWLHV $FW RI ((2$f DW 86& 86 & i If ,ELG

PAGE 112

2Q $XJXVW D &RQVHQW 'HFUHH ZDV VLJQHG LQ 8QLWHG 6WDWHV 'LVWULFW &RXUW RQ EHKDOI RI WKH )ORULGD 6WDWH %RDUG RI (GXFDWLRQ DQG RI WKH SODLQWLIIV ZKR KDG DOOHJHG WKDW WKH 6WDWH %RDUG RI (GXFDWLRQ KDG QRW FRPSOLHG ZLWK LWV REOLJDWLRQV XQGHU IHGHUDO DQG VWDWH ODZ WR HQVXUH WKDW WKH )ORULGD VFKRRO GLVWULFWV SURYLGHG HTXDO DQG FRPSUHKHQVLEOH LQVWUXFWLRQ WR /LPLWHG (QJOLVK 3URILFLHQW /(3f VWXGHQWV 7KH &RQVHQW 'HFUHH YDULRXVO\ NQRZQ DV (QJOLVK IRU 6SHDNHUV RI 2WKHU /DQJXDJHV (62/f $JUHHPHQW WKH 'HSDUWPHQW RI (GXFDWLRQ '2(f 0XOWLFXOWXUDO (GXFDWLRQ 7UDLQLQJ $GYRFDF\ ,QF 0(7$f $JUHHPHQW DQG WKH 'RH0(7$ &RQVHQW 'HFUHH JRYHUQHG WKH HGXFDWLRQ RI /(3 VWXGHQWV LQ WKH VWDWH RI )ORULGD LQ JUDGHV 3UH. WR ,W ZDV LQFRUSRUDWHG LQWR )ORULGD 6WDWXWHV f DQG )ORULGD 6WDWH %RDUG RI (GXFDWLRQ 5XOHV $ $f 7KH YLDELOLW\ RI WKH GHFUHH GLG QRW GHSHQG RQ LWV EHLQJ VDQFWLRQHG E\ VWDWH VWDWXWH DQG UXOH 7KH DJUHHPHQW ZDV DOVR VLJQLILFDQW EHFDXVH LW SUHYHQWHG WKH VWDWH IURP UHTXHVWLQJ VSHFLILF LQIRUPDWLRQ UHODWLYH WR LPPLJUDWLRQ VWDWXV H[FHSW IRU LQIRUPDWLRQ UHODWLYH WR WKH (PHUJHQF\ ,PPLJUDQW (GXFDWLRQ 3URJUDP DQG UHIXJHH HGXFDWLRQ SURJUDPVf %HJLQQLQJ ZLWK WKH ILVFDO \HDU DOO VWXGHQWV ZHUH VXUYH\HG RQ WKHLU (QJOLVK SURILFLHQF\ DQG QHZ VWXGHQWV ZHUH VXUYH\HG LQ VXEVHTXHQW \HDUV 6WXGHQWV FODVVLILHG DV /LPLWHG (QJOLVK 3URILFLHQW /(3f EHFDPH HOLJLEOH IRU DSSURSULDWH FODVVURRP LQVWUXFWLRQ /HDJXH RI 8QLWHG /DWLQ $PHULFDQ &LWL]HQV /8/$&f HW DO Y WKH 6WDWH %RDUG RI (GXFDWLRQ HW DO &RQVHQW 'HFUHH 86 'LVWULFW &RXUW IRU WKH 6RXWKHUQ 'LVWULFW RI )ORULGD $XJXVW ,ELG f7KH 8QIDLU %XUGHQf ,PPLJUDWLRQfV ,PSDFW RQ )ORULGD )ORULGD *RYHUQRUfV 2IILFH 7DOODKDVVHH ), 0DUFK ,ELG

PAGE 113

)HGHUDO VWDWXWHV DQG FDVH ODZ UHTXLUHG VFKRRO GLVWULFWV WR WDNH DSSURSULDWH DFWLRQ WR RYHUFRPH ODQJXDJH EDUULHUV WKDW LPSHGHG VWXGHQW DFKLHYHPHQW 7KH VSHFLILF DFWLRQ ZDV OHIW WR WKH GLVFUHWLRQ RI WKH VFKRRO GLVWULFW VR ORQJ DV LW ZDV EDVHG RQ f D VRXQG HGXFDWLRQDO WKHRU\ f VXIILFLHQW UHVRXUFHV LPSOHPHQWHG WR HQDFW WKH WKHRU\ DQG f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

PAGE 114

fSD\ WKHLU ZD\f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n DGYLFH WKRXJKWV DQG RSLQLRQV 7KH PRVW KHOSIXO FRVW HIILFLHQW DQG SURGXFWLYH LQLWLDWLYHV QHHGHG WR EH LPSOHPHQWHG DQG LQ VRPH FDVHV GHYHORSHG WR VHUYH WKH XQGRFXPHQWHG LPPLJUDQW LQ WKHLU DGRSWHG VRFLHW\ 7KH HTXDO SURWHFWLRQ TXHVWLRQ HPHUJHG EHFDXVH RI WKH YDULDWLRQ LQ ORFDO VFKRRO GLVWULFWVf HGXFDWLRQDO H[SHQGLWXUHV 7KH OHYHO RI VFKRRO H[SHQGLWXUH LQ D GLVWULFW ZDV PDLQO\ GHWHUPLQHG E\ WKH ZHDOWK RI WKH ORFDO WD[ EDVH LH WD[DWLRQ RI UHDO SURSHUW\ ,Q VRPH GLVWULFWV SURSHUW\ LQFOXGHG ODUJH HVWDWHV DQG EURDG LQGXVWULDO KROGLQJV WKDW JHQHUDWHG ODUJH DPRXQWV RI WD[ UHYHQXH ,Q FRQWUDVW GLVWULFWV ZLWKRXW LQGXVWULHV RU KLJK LQFRPH SURSHUW\ GLG QRW KDYH D VWURQJ WD[ EDVH ZKLFK OLPLWHG WKH DPRXQW RI PRQH\ DYDLODEOH IRU HGXFDWLRQ 'DYLG : 6WHZDUW f ,PPLJUDWLRQ DQG (GXFDWLRQ 7KH &ULVLV DQG WKH 2SSRUWXQLWLHV /H[LQJWRQ %RRNV 1HZ
PAGE 115

7KH 6HUUDQR Y 3ULHVW FDVH LOOXVWUDWHG GLVWULFW GLVSDULWLHV -RKQ 6HUUDQRfV WZR FKLOGUHQ OLYHG LQ DQG DWWHQGHG VFKRRO LQ D SRRU 0H[LFDQ$PHULFDQ FRPPXQLW\ LQ /RV $QJHOHV +H ZDQWHG TXDOLW\ HGXFDWLRQ IRU KLV FKLOGUHQ DQG IHOW WKDW WKH\ ZHUH GHQLHG HTXDO SURWHFWLRQ EHFDXVH RI WKHLU ODFN RI ZHDOWK 7KH &DOLIRUQLD 6XSUHPH &RXUW DJUHHG ZLWK WKH SODLQWLIIV FRQWHQWLRQ LQ WKH 6HUUDQR FDVH f:H KDYH GHWHUPLQHG WKDW WKLV IXQGLQJ VFKHPH LQYLGLRXVO\ GLVFULPLQDWHV DJDLQVW WKH SRRU EHFDXVH LW PDNHV WKH TXDOLW\ RI D FKLOGfV HGXFDWLRQ D IXQFWLRQ RI WKH ZHDOWK RI KLV SDUHQWV DQG QHLJKERUVf ,Q WKH 6XSUHPH &RXUWfV ODQGPDUN GHFLVLRQ LQ %URZQ Y %RDUG RI (GXFDWLRQ VHW HTXDOLW\ RI HGXFDWLRQDO RSSRUWXQLW\ f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f (GXFDWLRQ ILQDQFH WKHRULVWV FODLPHG WKDW WKLV SDVVDJH EDVLFDOO\ PHDQW WKDW ZKHUH WKH JRYHUQPHQW KDG XQGHUWDNHQ WR SURYLGH HGXFDWLRQ LW GLG VR RQ DQ HTXDO EDVLV IRU DOO WKH UHVLGHQWV RI D JLYHQ VWDWH %URZQ Y %RDUG RI (GXFDWLRQ PDUNHG WKH PRGHP HUD RI HGXFDWLRQ ILQDQFH WKHRULVWV XVLQJ WKH FRXUWV DV WKH YHKLFOH WR VKDSH HGXFDWLRQ ILQDQFH 6HUUDQR Y 3ULHVW &DOLIRUQLD 6XSUHPH &RXUW ,ELG %URZQ 9 %RDUG RI (GXFDWLRQ 86 6 &W f ,ELG SS -DPHV : *XWKULH 6FKRRO )LQDQFH 3ROLFLHV DQG 3UDFWLFHV WKH V $ 'HFDGH RI &RQIOLFW f

PAGE 116

FKDQJH 6RFLDO HTXLW\ LQ HGXFDWLRQ ZRXOG EHFRPH SDUW RI WKH FRQVFLRXVQHVV RI WKH $PHULFDQ SXEOLF IURP WKLV SRLQW IRUZDUG 7KH GHEDWH LQ &DOLIRUQLD RYHU SURYLGLQJ SXEOLF HGXFDWLRQ WR FKLOGUHQ RI XQGRFXPHQWHG LPPLJUDQWV FHQWHUHG RQ WKH fELOOLRQ VXEVLG\f HQGXUHG E\ &DOLIRUQLD WD[ SD\HUV 7KRVH ZKR TXRWHG WKLV H[SHQVH DVVXPHG WKDW LW ZDV WKH WUXH FRVW RI HGXFDWLQJ WKHVH FKLOGUHQ DQG ZRXOG EH WKH QHW VDYLQJV WR WKH SXEOLF HGXFDWLRQ V\VWHP IURP EDUULQJ LOOHJDO LPPLJUDQWV 7KH EDVLV IRU WKH ELOOLRQ &DOLIRUQLDf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

PAGE 117

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f 7KHUHIRUH WKH /(3 SURJUDP FRVWV LQ 6HPLQROH &RXQW\ ZHUH SHU VWXGHQW SHU \HDU ZKLFK ZDV D SURJUDP FRVW GLIIHUHQWLDO RU SHUFHQW PRUH H[SHQGLWXUHVf 7KH (PHUJHQF\ ,PPLJUDQW (GXFDWLRQ $FW (,($fRI IXQGHG WKH (PHUJHQF\ ,PPLJUDQW (GXFDWLRQ 3URJUDP (,(3f (,($ IXQGV SURYLGHG VXSSOHPHQWDO HGXFDWLRQ DVVLVWDQFH IRU LPPLJUDQW VWXGHQWV DQG IRU WKH WUDLQLQJ RI WHDFKHUV UHVSRQVLEOH IRU LQVWUXFWLQJ WKHVH VWXGHQWV LQ ERWK SXEOLF DQG QRQSXEOLF HOHPHQWDU\ DQG VHFRQGDU\ VFKRROV (OLJLEOH VWXGHQWV ZHUH FODVVLILHG RIILFLDOO\ E\ WKH 86 'HSDUWPHQW RI -XVWLFH ,ELG ,ELG -RVHSK *UHHQH )7( $GPLQLVWUDWRU 6HPLQROH &RXQW\ 3XEOLF 6FKRROV 6DQIRUG )ORULGD f 7KH (PHUJHQF\ ,PPLJUDQW (GXFDWLRQ $FW (,($f 7LWOH ,9 SDUW RI WKH (OHPHQWDU\ DQG 6HFRQGDU\ (GXFDWLRQ $FW DV DPHQGHG 86& f

PAGE 118

,PPLJUDWLRQ DQG 1DWXUDOL]DWLRQ 6HUYLFHf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b )HGHUDO )XQGLQJf ),6&$/ <($5 180%(5 678'(176 )81',1* 727$/ )('(5$/ (;3(1',785(6 6RXUFH )ORULGD 'HSDUWPHQW RI (GXFDWLRQ 2IILFH RI 0XOWLFXOWXUDO 6WXGHQW /DQJXDJH (GXFDWLRQ 6HSWHPEHU f7KH 8QIDLU %XUGHQf ,PPLJUDWLRQfV ,PSDFW RQ )ORULGD )ORULGD *RYHUQRUfV 2IILFH 7DOODKDVVHH )/ 0DUFK 7KHVH GDWD ZHUH WKH ODWHVW DYDLODEOH DV RI $SULO )XUWKHU UHVHDUFK ZDV LQ SURJUHVV E\ WKH )ORULGD 'HSDUWPHQW RI (GXFDWLRQ

PAGE 119

)ORULGDfV HGXFDWLRQ FRVWV IRU ERWK OHJDO DQG LOOHJDO LPPLJUDQWV LQ ZHUH PLOOLRQ ZKLFK ZDV XS IURP fV H[SHQGLWXUH RI PLOOLRQ 7KH 6WDWH VSHQW PLOOLRQ DORQH RQ WKH (QJOLVK IRU 6SHDNHUV RI 2WKHU /DQJXDJHV (62/f SURJUDP 7KH QXPEHU RI VWXGHQWV EHLQJ VHUYHG LQ (62/ SURJUDPV GXULQJ WKH VFKRRO \HDU ZDV DQG IRU WKH VFKRRO \HDU WKH QXPEHU ZDV RXW RI WRWDO VWXGHQW 3UH. WKURXJK f PHPEHUVKLS RI DQG UHVSHFWLYHO\ 7KHVH QXPEHUV UHIOHFWHG RQO\ WKRVH VWXGHQWV EHLQJ VHUYHG LQ WKH (62/ SURJUDP DQG ZDV QRW LQFOXVLYH RI DOO LPPLJUDQW OHJDO DQG LOOHJDOf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f ZZZIDLUXVRUJWOVRFKOP! )ORULGD 'HSDUWPHQW RI (GXFDWLRQ 3URILOHV RI 6FKRRO 'LVWULFW 7RWDOV )HEUXDU\ f )ORULGD 'HSDUWPHQW RI (GXFDWLRQ )XOO7LPH 3XEOLF 6FKRRO (TXLYDOHQF\ 5HSRUW RI 6WXGHQW (QUROOPHQW f7KH 8QIDLU %XUGHQf ,PPLJUDWLRQnV ,PSDFW RQ )ORULGD )ORULGD *RYHUQRUfV 2IILFH 7DOODKDVVHH )/ 0DUFK /DWHU VWDWHZLGH H[SHQGLWXUH ILJXUHV ZHUH QRW DYDLODEOH DV $SULO f

PAGE 120

$FFRUGLQJ WR WKH &HQVXV )ORULGD KDG DERXW /LPLWHG (QJOLVK 3URILFLHQW /(3f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f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f 7KLV UHSRUW RQ WKH QHW FRVWV RI LPPLJUDWLRQ WR WD[SD\HUV RI )ORULGD ZDV D IROORZXS WR +XGGOHfV FRPSUHKHQVLYH QDWLRQZLGH VWXG\ f7KH 1HW 1DWLRQDO &RVWV RI ,PPLJUDWLRQ LQ f UHOHDVHG LQ -XQH RI 7KH QDWLRQDO VWXG\ SRLQWHG RXW WKDW OHJDO DQG LOOHJDO LPPLJUDQWV ZKR KDYH VHWWOHG LQ WKH 86 VLQFH FRVW WD[SD\HUV ELOOLRQ QHW LQ SXEOLF DVVLVWDQFH DQG ZRUNHU GLVSODFHPHQW LQ LQ H[FHVV RI ELOOLRQ WKH\ SDLG LQ WD[HV 0RUH WKDQ b RI WKHVH FRVWV UHVXOWHG IURP OHJDO LPPLJUDWLRQ 2I WKH PLOOLRQ SHRSOH DGGHG WR WKH QDWLRQfV SRSXODWLRQ IURP WR PLOOLRQ RU b ZHUH LPPLJUDQWV 7KH QDWLRQDO DQG )ORULGD VWXGLHV DUH SDUW RI D VHULHV RI LPPLJUDWLRQ FRVW VWXGLHV FRPPLVVLRQHG E\ &DUU\LQJ &DSDFLW\ 1HWZRUN

PAGE 121

,OO ELOOLRQ bf 6RFLDO 6HFXULW\ bf /RFDO JRYHUQPHQW VHUYLFHV bf 0HGLFDLG bf DQG &ULPLQDO MXVWLFH DQG FRUUHFWLRQV bf 3RSXODWLRQ 'DWD $FFRUGLQJ WR ,PPLJUDWLRQ DQG 1DWXUDOL]DWLRQ 6HUYLFH ,16f ILJXUHV IRU SRSXODWLRQ GDWD LQGLFDWHG 7DEOH ,PPLJUDWLRQ DQG )ORULGD 6WDWH SRSXODWLRQ &HQVXV %XUHDX HVWf )RUHLJQERP SRSXODWLRQ &XUUHQW 3RSXODWLRQ 6XUYH\f&36f 3HUFHQW IRUHLJQ ERP b f&36f ,PPLJUDQW 6WRFN &% HVWf 3HUFHQW 86 FLWL]HQ b &36f ,OOHJDO DOLHQ SRSXODWLRQ ,PPLJUDWLRQ DQG 1DWXUDOL]DWLRQ 6HUYLFH HVWf 1HZ OHJDO LPPLJUDQWV WR f SRS 3URMHFWLRQ &% SURMHFWLRQf 6RXUFH ,PPLJUDWLRQ DQG )ORULGD )$,5 )ORULGD KDG WKH WKLUG ODUJHVW LPPLJUDQW SRSXODWLRQ LQ WKH 8QLWHG 6WDWHV LQ DIWHU &DOLIRUQLD DQG 1HZ
PAGE 122

OLYHG LQ )ORULGD 7KH PDMRULW\ RI )ORULGDfV LPPLJUDQWV DW WKDW WLPH FDPH IURP WKH &DULEEHDQ EDVLQ 0H[LFR SOD\HG D PLQRU UROH LQ WKH VHWWOHPHQW SDWWHUQ )ORULGDfV XQGRFXPHQWHG DOLHQ VWXGHQWV FDPH IURP D GLYHUVH PL[ RI FXOWXUHV DQG EDFNJURXQGV b +DLWL b %DKDPDV b &DQDGD 1LFDUDJXD b 0H[LFR b -DPDLFD b &ROXPELD b +RQGXUDV 1 2WKHU 6RXUFH 7KH 8QIDLU %XUGHQ )ORULGD *RYHUQRUfV 2IILFH 0DUFK )LJXUH (VWLPDWHG 8QGRFXPHQWHG ,PPLJUDQW 3RSXODWLRQ LQ )ORULGD LQ E\ &RXQWU\ RI 2ULJLQ )ORULGD UHFHLYHG IHGHUDO DVVLVWDQFH WR KHOS GHIUD\ WKH FRVWV RI WKH LQFDUFHUDWHG FULPLQDO DOLHQ SRSXODWLRQ LQ WKH VWDWH DQG WR KHOS ZLWK ZHOIDUH EHQHILWV WKDW WKH VWDWH KDG WR SD\ DIWHU WKH DPQHVW\ IRU LOOHJDO DOLHQV 7KH IHGHUDO IXQGLQJ IHOO VKRUW RI WKH ,ELG ,PPLJUDWLRQ 5HIRUP DQG &RQWURO $FW 3XE / 1R 6WDW f

PAGE 123

FRVWV RI LPPLJUDQWV WR WKH VWDWH ZKLFK OHG WKH VWDWH WR VXH XQVXFFHVVIXOO\ WKH IHGHUDO JRYHUQPHQW IRU DGGLWLRQDO UHPXQHUDWLRQ 7KH 6XSUHPH &RXUW UXOHG WKDW WKH GLVSXWH EHWZHHQ )ORULGD DORQJ ZLWK RWKHU VWDWHV KHDYLO\ LPSDFWHG E\ LPPLJUDWLRQ DQG WKH IHGHUDO JRYHUQPHQW ZDV D SROLF\ LVVXH WKDW PXVW EH VHWWOHG E\ &RQJUHVV ZKLFK LV UHVSRQVLEOH IRU FUHDWLQJ WKH QDWLRQf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f DQG VHSDUDWLRQ IURP IDPLO\ PHPEHUV 2WKHU VWUHVVHV LQFOXGHG DGDSWDWLRQ WR D QHZ FXOWXUH WKH FKDOOHQJH RI OHDUQLQJ D QHZ ODQJXDJH DQG RIWHQ WKH LQVXOW RI UDFLDO GLVFULPLQDWLRQ LQ WKLV FRXQWU\ 0DQ\ LPPLJUDQW IDPLOLHV KDG D GLIILFXOW WLPH VLPSO\ PDNLQJ HQGV PHHW PDQ\ OHG OLYHV RI SRYHUW\ LQ XUEDQ DUHDV &KLOHV Y 86 &\QWKLD 0F'DQLHOV f(TXDOLW\ RI (GXFDWLRQDO 2SSRUWXQLW\ 5DFH DQG )LQDQFH LQ 3XEOLF (GXFDWLRQf 7KH &RQVWLWXWLRQ &RXUWV DQG 3XEOLF 6FKRROV 9ROO
PAGE 124

$V D VXEVHW RI WKH LPPLJUDQW SRSXODWLRQ XQGRFXPHQWHG FKLOGUHQ ZHUH OLNHO\ WR FRQIURQW WKH PRVW GLVWUHVVLQJ H[SHULHQFHV RI DOO ,Q DGGLWLRQ WR WKH XVXDO H[SHULHQFHV RI JURZLQJ XS DQG WKH XQXVXDO VWUHVV RI LPPLJUDWLRQ XQGRFXPHQWHG LPPLJUDQW FKLOGUHQ ZRUULHG DERXW GHSRUWDWLRQ ,I WKHLU XQGRFXPHQWHG VWDWXV ZDV GLVFRYHUHG WKH ,PPLJUDWLRQ DQG 1DWXUDOL]DWLRQ 6HUYLFH ,16f KDG WKH OHJDO DXWKRULW\ WR LQYHVWLJDWH WKHP )XUWKHU WKH ,16 FRXOG KDYH GHWDLQHG WKHP DSDUW IURP WKHLU IDPLOLHV LQ IHGHUDOO\ RSHUDWHG FHQWHUV 6LQFH WKH 3O\OHUn GHFLVLRQ VWDWHV FRXOG QR ORQJHU XVH UHVLGHQF\ UHTXLUHPHQWV WR GHQ\ XQGRFXPHQWHG FKLOGUHQ DFFHVV WR D WXLWLRQIUHH SXEOLF HGXFDWLRQ 8QGHU 3O\OHU XQGRFXPHQWHG LPPLJUDQW VWXGHQWV KDG WKH VDPH ULJKW WR DWWHQG SXEOLF VFKRROV WKURXJK *UDGH DV GLG FLWL]HQV DQG SHUPDQHQW UHVLGHQWV 6FKRRO VWDII QHHGHG WR EH DZDUH DQG VHQVLWLYH DV WKH\ GHDOW ZLWK DOO LPPLJUDQW VWXGHQWV ,Q SDUWLFXODU WKH\ DFWHG WR SUHVHUYH WKH ULJKW RI DFFHVV HVSHFLDOO\ E\ JXDUGLQJ WKH FRQILGHQWLDOLW\ RI VWXGHQWVf LPPLJUDWLRQ VWDWXV ,Q IDFW LI DQ XQGRFXPHQWHG VWXGHQW UHDVRQDEO\ SHUFHLYHG WKDW DQ DFWLRQ KDG WKH LQWHQW RI H[SRVLQJ LPPLJUDWLRQ VWDWXV WKHQ WKH ULJKW RI DFFHVV ZDV FRPSURPLVHG 3O\OHU PRUHRYHU UHTXLUHG WKDW VFKRROV DSSOLHG WKH ULJKW RI DFFHVV WR DOO LPPLJUDQW VWXGHQWV 7KLV VWHS JXDUGHG DJDLQVW LPSURSHU GLVWLQFWLRQV EHWZHHQ GRFXPHQWHG DQG ,ELG 0RUDOHV ,PSURYHPHQWV $KHDG LQ ,16 7UHDWPHQW RI 'HWDLQHG &KLOGUHQ
PAGE 125

XQGRFXPHQWHG VWXGHQWV 7KH ULJKW RI DFFHVV LPSOLHG WKDW XQGRFXPHQWHG VWXGHQWV DOVR KDG DFFHVV WR DSSURSULDWH VSHFLDO SURJUDPV DYDLODEOH WR RWKHU VWXGHQWV 6FKRRO VWDII ZHUH QRW WR f $VN DERXW D VWXGHQWfV LPPLJUDWLRQ VWDWXV RU UHTXHVW GRFXPHQWDWLRQ DW DQ\ WLPH f %DU DFFHVV WR D VWXGHQW RQ WKH EDVLV RI XQGRFXPHQWHG VWDWXV RU DOOHJHG XQGRFXPHQWHG VWDWXV f 7UHDW RQH VWXGHQW GLIIHUHQWO\ IURP RWKHUV LQ RUGHU WR GHWHUPLQH UHVLGHQF\ RU RQ WKH EDVLV RI XQGRFXPHQWHG VWDWXV f 0DNH LQTXLUHV RI D VWXGHQW IURP RWKHUV LQ RUGHU WR GHWHUPLQH UHVLGHQF\ f 0DNH LQTXLULHV RI D VWXGHQW RU SDUHQW WKDW PLJKW H[SRVH WKH XQGRFXPHQWHG VWDWXV RI HLWKHU RU f 5HTXLUH XQGRFXPHQWHG VWXGHQWV RU WKHLU SDUHQWV WR DSSO\ IRU 6RFLDO 6HFXULW\ QXPEHUV :LOOVKLUH &DUUHUD LQ KLV UHYLHZ RI SUDFWLFHV DQG SROLFLHV UHFRPPHQGHG WKDW LQ UHVSRQGLQJ WR WKH QHHGV RI XQGRFXPHQWHG VWXGHQWV VFKRRO VWDII VKRXOG KDYH XQGHUVWRRG WKH WURXEOHG QDWXUH RI LPPLJUDQWVf GDLO\ OLYHV XQGHUVWRRG DQG DFWLYHO\ SURYLGHG WKH ULJKW RI DFFHVV HVWDEOLVKHG E\ 3O\OHU HVWDEOLVKHG D VFKRRO FOLPDWH WKDW DOO LPPLJUDQW VWXGHQWV IRXQG RSHQ DQG KRVSLWDEOH SURYLGHG FRXQVHOLQJ DQG JXLGDQFH WKDW ZDV UHVSRQVLYH WR WKH FRQGLWLRQV RI LPPLJUDQW VWXGHQWVf OLYHV GHYHORSHG SROLFLHV DQG SUDFWLFHV WKDW VWUHQJWKHQHG LPPLJUDQW VWXGHQWVf DFFHVV WR HIIHFWLYH LQVWUXFWLRQ UHVSHFWHG LPPLJUDQW FRPPXQLWLHV QDWLYH ODQJXDJHV DQG FXOWXUHV DW WKH VDPH WLPH KHOSHG LPPLJUDQW VWXGHQWV WR OHDUQ (QJOLVK KLUHG WUDLQHG DQG UHWDLQHG FRPSHWHQW VWDII ZKR SURYLGHG DSSURSULDWHG ,ELG %HFDXVH XQGRFXPHQWHG VWXGHQWV DUH QRW HOLJLEOH IRU 6RFLDO 6HFXULW\ QXPEHUV VFKRROV PD\ QRW UHTXLUH WKHP DV D FRQGLWLRQ RI HQUROOPHQW :LOOVKLUH &DUUHUD (GXFDWLQJ 8QGRFXPHQWHG &KLOGUHQ $ 5HYLHZ 2I 3UDFWLFHV $QG 3ROLFLHV 7UHQGV DQG ,VVXHV 3DSHUf &KDUOHVWRQ :9 (5,& &OHDULQJKRXVH RQ 5XUDO (GXFDWLRQ DQG 6PDOO 6FKRROV f

PAGE 126

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f WKH (PHUJHQF\ ,PPLJUDQW (GXFDWLRQ 3URJUDP f )XQGV UHFHLYHG XQGHU 6HFWLRQ RI WKH ,PPLJUDQW 5HIRUP DQG &RQWURO $FW f WKH 7UDQVLWLRQDO 3URJUDP IRU 5HIXJHH &KLOGUHQ f %LOLQJXDO HGXFDWLRQ SURJUDPV f &KDSWHU SURJUDPV f +HDGVWDUW SURJUDPV f 6SHFLDO HGXFDWLRQ DQG f )UHH DQG UHGXFHG PHDO SURJUDPV ,PPLJUDQW 6WXGHQWV 0RVW LPPLJUDQW FKLOGUHQ DQG WKHLU IDPLOLHV OLYHG LQ VL[ VWDWHV &DOLIRUQLD )ORULGD FR ,OOLQRLV 1HZ -HUVH\ 1HZ
PAGE 127

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fV H[SHULHQFHV LQ WKH 8QLWHG 6WDWHV LQFOXGLQJ WKHLU HOLJLELOLW\ IRU VRPH VRFLDO DQG HFRQRPLF UHVRXUFHV 7KH SUHYDLOLQJ LPSUHVVLRQ ZDV WKDW LPPLJUDQW VWXGHQWV UHJDUGOHVV RI WKHLU FRXQWU\ RI RULJLQ GLG QRW DGMXVW ZHOO WR VFKRRO DQG SHUIRUPHG SRRUO\ DFDGHPLFDOO\ DQG GUDLQHG UHVRXUFHV IURP DQ DOUHDG\ RYHUEXUGHQHG HGXFDWLRQDO V\VWHP +RZHYHU WKH QRWLRQ RI D PRQROLWKLF YLHZ RI WKH LPPLJUDQW VWXGHQW ZDV IDU IURP DFFXUDWH LPPLJUDQW FKLOGUHQf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

PAGE 128

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f JUHDWO\ DIIHFWHG VFKRRO DFKLHYHPHQW LQ DQ DEVROXWH VHQVH (VWLPDWHV RI VWXGHQWV ZLWK OLPLWHG (QJOLVK SURILFLHQF\ UDQJHG IURP PLOOLRQ WR DV KLJK DV PLOOLRQ 7KH &HQVXV %XUHDX IXUWKHU HVWLPDWHG WKDW PLOOLRQ VFKRRO DJH FKLOGUHQ OLYHG LQ KRXVHKROGV LQ ZKLFK QR RQH DJH RU ROGHU VSRNH (QJOLVK fYHU\ ZHOOf 7KH FRQWLQXHG LQIOX[ RI QHZ LPPLJUDQW JURXSV PHDQW FRQWLQXLQJ LQFUHDVHV LQ WKH QXPEHU RI VWXGHQWV ZKR HQWHUHG WKH $PHULFDQ VFKRROV ZLWK OLWWOH RU QR (QJOLVK SURILFLHQF\ f,ELG /RUUDLQH 0 0F'RQQHOO DQG 3DXO 7 +LOO 1HZFRPHUV LQ $PHULFDQ 6FKRROV 0HHWLQJ WKH HGXFDWLRQDO QHHGV RI ,PPLJUDQW
PAGE 129

,PPLJUDQW FKLOGUHQ ZLWK OLPLWHG (QJOLVK SURILFLHQF\ ZHUH HOLJLEOH WR SDUWLFLSDWH LQ VFKRRO SURJUDPV IXQGHG E\ WKH %LOLQJXDO (GXFDWLRQ $FW ZKLFK DXWKRUL]HG WKH (PHUJHQF\ ,PPLJUDQW (GXFDWLRQ SURJUDP 7KH\ FRXOG WDNH SDUW LQ (QJOLVK DV D VHFRQG ODQJXDJH (6/f RU /LPLWHG (QJOLVK SURILFLHQF\ /(3f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f DVVHVVPHQW LQVWUXPHQWV LQ ODQJXDJHV RWKHU WKDQ (QJOLVK DQG 6SDQLVK (WKLFV $QG 7KH 'HPRFUDF\ 2I (GXFDWLRQ )RUPDO LQVWUXFWLRQ LQ WKH 8QLWHG 6WDWHV ZDV RULJLQDOO\ EHJXQ DV D PHDQV WR WHDFK WKH %LEOH f:KDW WKH EHVW DQG ZLVHVW SDUHQW ZDQWV IRU KLV RZQ FKLOG WKDW PXVW WKH FRPPXQLW\ ZDQW IRU DOO RI LWV FKLOGUHQ f -RKQ 'HZH\ (PHUJHQF\ (GXFDWLRQ $FW RI ,PPLJUDQW &KLOGUHQ DQG 7KHLU )DPLOLHV ,VVXHV IRU 5HVHDUFK DQG 3ROLF\ 7KH )XWXUH RI &KLOGUHQ 9RO 1R 6XPPHU)DOO ,ELG 0RUDO (GXFDWLRQ LQ WKH 8IH RI WKH 6FKRRO $VVRFLDWLRQ IRU 6XSHUYLVLRQ DQG &XUULFXOXP 'HYHORSPHQW (GXFDWLRQDO /HDGHUVKLS 0D\ f 5D\PRQG %RLVYHUW -RKQ 'HZH\ 5HWKLQNLQJ 2XU 7LPH 6WDWH 8QLYHUVLW\ RI 1HZ
PAGE 130

-RKQ 'HZH\ f RQFH FDOOHG fWKH JXLGH WKH PHQWRU DQG WKH FRQVFLHQFH RI WKH $PHULFDQ SHRSOHf RIWHQ VSRNH RQ PDMRU LVVXHV RI KLV WLPH +H ZDV FRQVLGHUHG DQ HGXFDWLRQDO LQQRYDWRU DQG EHOLHYHG LQ WKH HGXFDWLRQ RI DOO FKLOGUHQ DV D EHQHILW WR VRFLHW\ f7KH LGHD RI IUHH DQG FRPPRQ VFKRROV GHYHORSHG DPRQJ XV RQ WKH JURXQGV WKDW D QDWLRQ RI WUXO\ IUHH PHQ DQG ZRPHQ UHTXLUHG VFKRROV RSHQ WR DOO DQG KHQFH VXSSRUWHG E\ SXEOLF WD[DWLRQf f8SRQ WKH ZKROH FRQVLGHUDEOH SURJUHVV KDV EHHQ PDGH LQ PDNLQJ VFKRROLQJ DFFHVVLEOH WR DOO WKRXJKW LW LV VWLOO WUXH WKDW WKH RSSRUWXQLW\ WR WDNH DGYDQWDJH RI ZKDW LV WKHRUHWLFDOO\ SURYLGHG IRU DOO LV VHULRXVO\ OLPLWHG E\ HFRQRPLF VWDWXVf +RUDFH 0DQQ DQ HGXFDWLRQDO UHIRUPHU LQVWUXPHQWDO LQ HVWDEOLVKLQJ WKH ILUVW QRUPDO VFKRRO LQ WKH 86 LQ RQFH VDLG f(GXFDWLRQ LV RXU RQO\ SROLWLFDO VDIHW\ RXWVLGH RI WKLV DUN LV WKH GHOXJHf +H ZDV DOVR TXRWHG E\ 'HZH\ DV VD\LQJ WKDW f7KH &RPPRQ 6FKRRO LV WKH JUHDWHVW GLVFRYHU\ HYHU PDGH E\ PDQ 2WKHU VRFLDO RUJDQL]DWLRQV DUH FXUDWLYH DQG UHPHGLDO 7KLV LV SUHYHQWLYH DQG DQWLGRWHf 7KH LQVWLWXWLRQ IRU ZKLFK +RUDFH 0DQQ ODERUHG QDPHO\ D SXEOLF VFKRRO V\VWHP VXSSRUWHG E\ SXEOLF WD[DWLRQ DQG RSHQ WR DOO FKLOGUHQ KDG RYHU WKH SDVVDJH RI PRUH WKDQ KXQGUHG \HDUV EHHQ UHDOL]HG WR D VXUSULVLQJ GHJUHH (GXFDWLRQ ZDV GHVLJQHG WR VHUYH WKH QHHGV RI WKH GHPRFUDWLF VRFLHW\ DQG RI WKH GHPRFUDWLF ZD\ RI OLIH /DUU\ $ +LFNPDQ DQG 7KRPDV 0 $OH[DQGHU 7KH (VVHQWLDO 'HZH\ ,QGLDQD 8QLYHUVLW\ 3UHVV %ORRPLQJWRQ ,QG f -RKQ 'HZH\ 3KLORVRSK\ RI (GXFDWLRQ 1HZ -HUVH\ /LWWOHILHOG $GDPV t &R S f ,ELG ,ELG S ,ELG

PAGE 131

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
PAGE 132

f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f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f DV FLWHG LQ $OH[DQGHU .HUQ DQG $OH[DQGHU 0 'DYLG $PHULFDQ 3XEOLF 6FKRRO /DZ 1HZ
PAGE 133

,Q +RUDFH 0DQQfV 7HQWK $QQXDO 5HSRUW WR WKH 0DVVDFKXVHWWV %RDUG RI (GXFDWLRQ f KH VWDWHG f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f ,Q KLV 7ZHOIWK 5HSRUW f 0DQQ DIILUPHG WKDW fZLWKRXW XQGHUYDOXLQJ DQ\ RWKHU KXPDQ DJHQF\ LW PD\ EH VDIHO\ DIILUPHG WKH &RPPRQ 6FKRRO PD\ EHFRPH WKH PRVW HIIHFWLYH DQG EHQLJQDQW RI DOO WKH IRUFHV RI FLYLOL]DWLRQf f$V fWKH FKLOG LV IDWKHU WR WKH PDQf VR PD\ WKH WUDLQLQJ RI WKH VFKRROURRP H[SDQG LQWR WKH LQVWLWXWLRQV DQG IRUWXQHV RI WKH VWDWHf f (GXFDWLRQ WKHQ EH\RQG DOO RWKHU GHYLFHV RI KXPDQ RULJLQ LV WKH JUHDW HTXDOL]HU RI WKH FRQGLWLRQV RI PHQ WKH EDODQFHZKHHO RI WKH VRFLDO PDFKLQHU\f f f ,Q 'HPRFUDF\ LQ $PHULFD $OH[LV 'H 7RFTXHYLOOH QRWHG WKDW HYHQ LQ LWV IRUPDWLYH VWDJHV RXU FRXQWU\ DWWHPSWHG WR EH D SODFH LQ ZKLFK LQGLYLGXDOV FRXOG DFKLHYH DQ HFRQRPLFDOO\ YLDEOH DQG VRFLDOO\ SURGXFWLYH SRVLWLRQ VROHO\ EHFDXVH RI WKHLU LQGLYLGXDO $OH[DQGHU DQG $OH[DQGHU $PHULFDQ 3XEOLF 6FKRRO /DZ S ,ELG S )URP WKH WK $QQXDO 5HSRUW SXEOLVKHG LQ 7KH &RPPRQ 6FKRRO -RXUQDO 9RO ,; 1R HGLWHG E\ +RUDFH 0DQQ %RVWRQ :LOOLDP % )RZOH f ,ELG WK $QQXDO 5HSRUW SXEOLVKHG VHSDUDWHO\ IURP WKH -RXUQDO E\ )RZOH LQ $OH[DQGHU DQG $OH[DQGHU $PHULFDQ 3XEOLF 6FKRRO /DZ S ,ELG S ,ELG $OH[LV 'H 7RFTXHYLOOH f )UHQFK VWDWHVPDQ DQG DXWKRU

PAGE 134

PHULWV DQG ZRUN HWKLFV +H EHOLHYHG WKDW DQ DFDGHPLF HGXFDWLRQ ZDV WKH IRXQGDWLRQ IRU DOO IXWXUH VXFFHVVHV RI WKH LQGLYLGXDO )ROORZLQJ +RUDFH 0DQQ DQG $OH[LV 'H 7RFTXHYLOOH FDPH -RKQ 'HZH\ ZKR EHOLHYHG WKDW fWKH LQGLYLGXDO ZKR LV WR EH HGXFDWHG LV D VRFLDO LQGLYLGXDO DQG WKDW VRFLHW\ LV DQ RUJDQLF XQLRQ RI LQGLYLGXDOV f7KH OHVVRQ WR EH OHDUQHG LV WKDW KXPDQ DWWLWXGHV DQG HIIRUWV DUH WKH VWUDWHJLF FHQWHU IRU SURPRWLRQ RI WKH JHQHURXV DLPV RI SHDFH DPRQJ QDWLRQV SURPRWLRQ RI HFRQRPLF VHFXULW\ WKH XVH RI SROLWLFDO PHDQV LQ RUGHU WR DGYDQFH IUHHGRP DQG HTXDOLW\ DQG WKH ZRUOGZLGH FDXVH RI GHPRFUDWLF LQVWLWXWLRQV 7KH EDVLF LPSRUWDQFH RI HGXFDWLRQ LV LQ FUHDWLQJ WKH KDELWV DQG WKH RXWORRN WKDW SHRSOH DUH DEOH DQG 4IO HDJHU WR VHFXUH WKH HQGV RI SHDFH DQG HFRQRPLF VWDELOLW\f 7KHQ LQ WKH KLJK FRXUW RI 7HQQHVVHH VDZ D QHHG IRU D XQLIRUP V\VWHP RI SXEOLF VFKRROV WR SURPRWH WKH JHQHUDO ZHOIDUH fE\ HGXFDWLQJ WKH SHRSOH DQG WKXV E\ SURYLGLQJ DQG VHFXULQJ D KLJKHU VWDWH RI LQWHOOLJHQFH DQG PRUDOV FRQVHUYH WKH SHDFH JRRG RUGHU DQG ZHOOEHLQJ RI VRFLHW\f )ROORZLQJ LQ VFKRRO DWWHQGDQFH EHFDPH FRPSXOVRU\ LQ HYHU\ 86 VWDWH 7KH SULYDWH UHWXUQV WR HGXFDWLRQ UHFHLYHG FRQVLGHUDEOH DWWHQWLRQ LQ ERWK DFDGHPLF UHVHDUFK DQG SXEOLF SROLF\ GLVFXVVLRQ 7KH SRVLWLYH HIIHFWV RI HGXFDWLRQ RQ LQGLYLGXDO $OH[LV 'H 7RFTXHYLOOH 'HPRFUDF\ LQ $PHULFD f 1HZ
PAGE 135

ZDJHV DQG LQFRPH ZHUH VXEVWDQWLDO DQG ZHOO GRFXPHQWHG )DU OHVV DWWHQWLRQ ZDV JLYHQ WR WKH SXEOLF EHQHILWV RI HGXFDWLRQ f§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f 7KH VWDWXV RI HGXFDWLRQ LQ VRFLHW\ ZDV D GLUHFW UHIOHFWLRQ RQ WKH OHYHO RI FLYLOL]DWLRQ D QDWLRQ DFKLHYHG $V FLYLOL]DWLRQV SURJUHVVHG HGXFDWLRQ EHFDPH PRUH LPSRUWDQW LQ FUHDWLQJ DQG VXVWDLQLQJ HFRQRPLF DQG VRFLDO SDWWHUQV 7KHUHIRUH DV LPPLJUDQWV EHJDQ WR ILOO WKH QDWLRQ WKH\ WRR UHTXLUHG WKH VDPH EDVLF HGXFDWLRQ DV WKH UHVW RI VRFLHW\ 1 6WDFH\ f6RFLDO %HQHILWV RI (GXFDWLRQf 7KH $QQXDOV RI WKH $PHULFDQ $FDGHP\ 6HSWHPEHU SS *HRUJH 9HPH] 5LFKDUG .URS DQG 3HWHU 5\GHO &ORVLQJ WKH (GXFDWLRQ *DS %HQHILWV DQG &RVWV 5$1' S 'DYLG & 7KRPSVRQ 5 &UDLJ :RRG DQG 'DYLG 6 +RQH\PDQ f )LVFDO /HDGHUVKLS IRU 6FKRROV &RQFHSWV DQG 3UDFWLFHV /RQJPDQ 1HZ
PAGE 136

6XPPDU\ :LWK WKH LQIOX[ RI LPPLJUDQWV VLQFH WKH V DQG WKH UDSLG FKDQJHV LQ WKH HWKQLF FRPSRVLWLRQ RI $PHULFDfV SRSXODWLRQ DQG WKH VFKRRO SRSXODWLRQ D JURZLQJ QHHG WR VHH WKDW DOO ZHUH HGXFDWHG EHFDPH SUHVVLQJ %DVHG RQ WKH HGXFDWLRQDO IRXQGDWLRQV RI WKH QLQHWHHQWK DQG WZHQWLHWK FHQWXULHV 7RFTXHYLOOH 0DQQ DQG 'HZH\f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

PAGE 137

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f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f :(% 'X %RLV f7KH )UHHGRP WR /HDUQf 0LGZHVW -RXUQDO :LQWHU SS

PAGE 138

'LVWLQFWLRQV ,W ZDV LPSRUWDQW WR UHFRJQL]H WKH GLVWLQFWLRQ RI WKH WZR W\SHV RI DOLHQ SROLFLHV LPPLJUDQW DQG LPPLJUDWLRQ ,PPLJUDQW SROLF\ IRFXVHG RQ ZKDW WR GR DERXW WKH HIIHFWV RI LPPLJUDWLRQ XSRQ RXU VRFLHW\ ,PPLJUDQW SROLF\ DGGUHVVHG WKH TXHVWLRQ :KDW VKDOO ZH GR DERXW LPPLJUDQWV RQFH WKH\ DUH KHUH" &RPPRQ LPPLJUDQW SROLF\ GHEDWHV LQFOXGHG ZKHWKHU ELOLQJXDO HGXFDWLRQ KHOSHG RU KLQGHUHG WKH FKLOGUHQ RI LPPLJUDQWV ZKHWKHU LPPLJUDQWV FRXOG UHFHLYH ZHOIDUH DQG ZKHWKHU QRQFLWL]HQV UHVLGHQWV FRXOG KDYH YRWLQJ ULJKWV ,PPLJUDQW SROLF\ ZDV GHFLGHG DW WKH VWDWH OHYHO ,PPLJUDWLRQ SROLF\ IRFXVHG RQ ZKDW WR GR DERXW WKH ODZV WKDW DGPLWWHG LPPLJUDQWV WR RXU FRXQWU\ DQG WKDW FUHDWHG LPPLJUDWLRQ IORZ ,PPLJUDWLRQ SROLF\ DGGUHVVHG WKH TXHVWLRQ :KR DQG KRZ PDQ\ SHRSOH VKRXOG EH DOORZHG WR LPPLJUDWH" ([DPSOHV RI LPPLJUDWLRQ SROLF\ GHEDWH LQFOXGHG ZKHWKHU WKHUH FRXOG EH DQ RYHUDOO FDS RQ LPPLJUDWLRQ KRZ FKDLQ PLJUDWLRQ FRXOG EH OLPLWHG DQG ZK\ VR PDQ\ XQVNLOOHG LPPLJUDQWV ZHUH EHLQJ DGPLWWHG ,PPLJUDWLRQ SROLF\ ZDV D IHGHUDO UHVSRQVLELOLW\ ,PPLJUDWLRQ )DFWV 7KH ,PPLJUDWLRQ DQG 1DWXUDOL]DWLRQ 6HUYLFH ,16f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

PAGE 139

DOLHQV LQWR OHJDO SHUPDQHQW UHVLGHQWV 7KH VWDWH JRYHUQPHQW HVWLPDWHG WKH LOOHJDO DOLHQ SRSXODWLRQ KLJKHUf§DERXW 7KH H[DFW QXPEHU RI LPPLJUDQW VWXGHQWV DWWHQGLQJ )ORULGD SXEOLF VFKRROV ZDV XQNQRZQ LQ RU LQ 7KH QXPEHU RI LPPLJUDQW VWXGHQWV HQUROOHG LQ VSHFLDO RU JLIWHG VWXGHQW SURJUDPV ZDV DOVR XQNQRZQ 7KH GLIILFXOW\ LQ LGHQWLI\LQJ WKH QXPEHU RI LPPLJUDQW VWXGHQWV ZDV GXH LQ SDUW WR WKH $XJXVW &RQVHQW 'HFUHH VLJQHG E\ WKH )ORULGD &RPPLVVLRQHU RI (GXFDWLRQ 'HSDUWPHQW RI (GXFDWLRQ DQG WKH VWDWH ERDUG RI (GXFDWLRQ ZLWK WKH 0XOWLFXOWXUDO (GXFDWLRQ WUDLQLQJ $GYRFDF\ ,QF WKDW SURKLELWHG HGXFDWLRQ RIILFLDOV IURP UHTXHVWLQJ FHUWDLQ LQIRUPDWLRQ RQ WKH UHVLGHQF\ VWDWXV RI WKH VWXGHQWVf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f HW DO Y WKH 6WDWH %RDUG RI (GXFDWLRQ HW DO &RQVHQW 'HFUHH 86 'LVWULFW &RXUW IRU WKH 6RXWKHUQ 'LVWULFW RI )ORULGD $XJXVW -RKQ :LOOVKLUH &DUUHUD ,PPLJUDQW 6WXGHQWV 7KHLU /HJDO 5LJKW RI $FFHVV WR 3XEOLF 6FKRROV f 1DWLRQDO &RDOLWLRQ RI $GYRFDWHV IRU 6WXGHQWV %RVWRQ 0$

PAGE 140

,Q DGGLWLRQ WR WKHLU 3O\OHU ULJKW RI DFFHVV XQGHU VWDWH ODZ ERWK GRFXPHQWHG DQG XQGRFXPHQWHG LPPLJUDQW VWXGHQWV ZHUH REOLJDWHG WR DWWHQG SULPDU\ DQG VHFRQGDU\ VFKRROV XQWLO WKH\ UHDFKHG D PDQGDWHG DJH DJH VL[WHHQ LQ WKH VWDWH RI )ORULGDf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f QRU VKDOO DQ\ VWDWH GHSULYH DQ\ SHUVRQ RI OLIH OLEHUW\ RU SURSHUW\ ZLWKRXW GXH SURFHVV RI ODZ QRU GHQ\ WR DQ\ SHUVRQ ZLWKLQ LWV MXULVGLFWLRQ WKH HTXDO SURWHFWLRQ RI WKH ODZVf 7KH )RXUWHHQWK $PHQGPHQW WR WKH &RQVWLWXWLRQ ZDV QRW FRQILQHG WR WKH SURWHFWLRQ RI FLWL]HQV 7KH SURYLVLRQV ZHUH XQLYHUVDO LQ WKHLU DSSOLFDWLRQ WR DO SHUVRQV ZLWKLQ WKH ,ELG 8QGRFXPHQWHG VWXGHQWV IRU WKLV SXUSRVH DUH VWXGHQWV .f ZKR UHVLGH LQ WKH 8QLWHG 6WDWHV ZLWKRXW OHJDO LPPLJUDWLRQ VWDWXV 7KDW LV VWXGHQWV ZKR HQWHUHG WKH 86 ZLWKRXW JRLQJ WKURXJK WKH ,PPLJUDWLRQ DQG 1DWXUDOL]DWLRQ 6HUYLFH DQG UHPDLQHG KHUH ZLWKRXW YDOLG LPPLJUDWLRQ SDSHUV RU VWXGHQW ZKR HQWHUHG ZLWK YDOLG YLVDV DQG ZKR KDYH VLQFH IDOOHQ RXW RI VWDWXV %URZQ Y %RDUG RI (GXFDWLRQ 86 f

PAGE 141

WHUULWRULDO MXULVGLFWLRQ ZLWKRXW UHJDUG WR DQ\ GLIIHUHQFHV RI UDFH RI FRORU RU RI QDWLRQDOLW\ DQG WKH SURWHFWLRQ RI WKH ODZV ZDV D SOHGJH RI WKH SURWHFWLRQ RI HTXDO ODZV 7KH IHGHUDO VWDWXWH UHJDUGLQJ (QJOLVK /DQJXDJH /HDUQHUV ZDV WKH (TXDO (GXFDWLRQ 2SSRUWXQLWLHV $FW ((2$f ,W SURYLGHG WKDW f1R VWDWHV VKDOO GHQ\ HTXDO HGXFDWLRQ RSSRUWXQLW\ WR DQ LQGLYLGXDO RQ DFFRXQW RI KLV UDFH FRORU VH[ RU QDWLRQDO RULJLQ E\ If WKH IDLOXUH E\ DQ HGXFDWLRQDO DJHQF\ WR WDNH DSSURSULDWH DFWLRQ WR RYHUFRPH ODQJXDJH EDUULHUV WKDW LPSHGH HTXDO SDUWLFLSDWLRQ E\ LWV VWXGHQWV LQ LWV LQVWUXFWLRQDO SURJUDPVf ,Q DGGLWLRQ 7LWOH 9, RI WKH &LYLO 5LJKWV $FW VWDWHV f1R SHUVRQ LQ WKH 8QLWHG 6WDWHV VKDOO RQ WKH JURXQG RI UDFH FRORU RU QDWLRQDO RULJLQ EH H[FOXGHG IURP SDUWLFLSDWLRQ LQ EH GHQLHG WKH EHQHILWV RI RU EH VXEMHFWHG WR GLVFULPLQDWLRQ XQGHU DQ\ SURJUDP RU DFWLYLW\ UHFHLYLQJ IHGHUDO ILQDQFLDO DVVLVWDQFHf ,Q /DX Y 1LFKROVnr WKH 8QLWHG 6WDWHV 6XSUHPH &RXUW KHOG WKDW WKH 6DQ )UDQFLVFR 6FKRRO 'LVWULFWfV IDLOXUH WR SURYLGH VXSSOHPHQWDO (QJOLVK /DQJXDJH LQVWUXFWLRQ WR &KLQHVH VSHDNLQJ VWXGHQWV YLRODWHG 7LWOH 9, RI WKH &LYLO 5LJKWV $FW DW 86& i G )ROORZLQJ WKH /DX FDVH WKH )LIWK &LUFXLW &RXUW RI $SSHDOV GHFLGHG WKH FDVH RI &DVWDQHGD Y 3LFNDUGn ,Q WKLV FDVH WKH IHGHUDO DSSHOODWH FRXUW VWDWHG D WKUHHSURQJHG WHVW WR GHWHUPLQH ZKHWKHU D VFKRRO GLVWULFWfV ODQJXDJH UHPHGLDWLRQ SURJUDP ZDV DSSURSULDWH )LUVW WKH FRXUW PXVW GHWHUPLQH ZKHWKHU D VFKRRO GLVWULFW ZDV SXUVXLQJ D SURJUDP
PAGE 142

fLQIRUPHG E\ OHJLWLPDWH H[SHULPHQWDO VWUDWHJ\f 6HFRQG WKH FRXUW PXVW HVWDEOLVK ZKHWKHU f WKH SURJUDPV DQG SUDFWLFHV DFWXDOO\ XVHG E\ WKH VFKRRO V\VWHP ZHUH UHDVRQDEO\ FDOFXODWHG WR LPSOHPHQW HIIHFWLYHO\ WKH HGXFDWLRQDO WKHRU\ DGRSWHG E\ WKH VFKRROf $QG WKLUG WKH FRXUW PXVW GHWHUPLQH ZKHWKHU WKH VFKRROfV SURJUDP DOWKRXJK SUHPLVHG RQ VRXQG HGXFDWLRQDO WKHRU\ DQG HIIHFWLYHO\ LPSOHPHQWHG fSURGXFHG UHVXOWV LQGLFDWLQJ WKDW WKH ODQJXDJH EDUULHUV FRQIURQWLQJ VWXGHQWV ZHUH DFWXDOO\ EHLQJ RYHUFRPHf ,Q &DVWDQHGD Y 3LFNDUG f WKH &RXUW UHLWHUDWHG WKDW &RQJUHVV LQ HQDFWLQJ 6HFWLRQ If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f DQG &DVWDQHGD Y 3LFNDUG f )G ,ELG S ,ELG S ,ELG &DVWDQHGD Y 3LFNDUG f ) G &DVWDQHGD ,,f .H\HV Y 6FKRRO 'LVWULFW 1RO f ) 6XSS 7HUHVD 3 Y %HUNHOH\ 8QLILHG 6FKRRO 'LVWULFW f ) 6XSS

PAGE 143

HYHQ WKRXJK WKH GLVWULFW FRXOG QRW REWDLQ DOO RI WKH QHFHVVDU\ FUHGHQWLDOHG WHDFKHUV LW GHPRQVWUDWHG DQ HIIRUW WR KLUH DV PDQ\ WHDFKHUV DV SRVVLEOH 7KH &RXUW DOVR DSSURYHG WHVWLQJ SURFHGXUHV ZKLFK LQFOXGHG D YDOLGDWHG WHVW DQG FODVVURRP WHDFKHU DVVHVVPHQW DV WR WKH (QJOLVK VNLOOV RI WKH VWXGHQWV 7KH &RXUW KDG GLIILFXOW\ GHWHUPLQLQJ KRZ WR PHDVXUH WKH HIILFDF\ RI D GLVWULFWfV ELOLQJXDO SURJUDP DQG DFFHSWHG DV JRRG HYLGHQFH WKH IDFW WKDW ELOLQJXDO VWXGHQWV ZHUH SURJUHVVLQJ DW DERXW WKH VDPH UDWH DV RWKHU ELOLQJXDO VWXGHQWV LQ WKH VWDWH RI &DOLIRUQLD 7KHUHIRUH IHGHUDO VWDWXWHV DQG FDVH ODZ UHTXLUHG WKDW VFKRRO GLVWULFWV WDNH DSSURSULDWH DFWLRQ WR RYHUFRPH ODQJXDJH EDUULHUV WKDW FRXOG LPSHGH VWXGHQW DFKLHYHPHQW 7KH VSHFLILF DFWLRQ ZDV OHIW WR WKH GLVFUHWLRQ RI WKH VFKRRO GLVWULFW VR ORQJ DV LW ZDV EDVHG RQ f D VRXQG HGXFDWLRQDO WKHRU\ f VXIILFLHQW UHVRXUFHV ZHUH LPSOHPHQWHG WR HQDFW WKH WKHRU\ DQG f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f VWXGHQWV

PAGE 144

7KH &RQVHQW 'HJUHH YDULRXVO\ NQRZQ DV WKH (QJOLVK IRU 6SHDNHUV RI 2WKHU /DQJXDJHV (62/f $JUHHPHQW WKH 'HSDUWPHQW RI (GXFDWLRQ '2(ff§0XOWLFXOWXUDO (GXFDWLRQ 7UDLQLQJ $GYRFDF\ ,QF 0(7$f $JUHHPHQW DQG WKH 'RH0(7$ &RQVHQW 'HFUHH JRYHUQHG WKH HGXFDWLRQ RI /(3 VWXGHQWV LQ WKH VWDWH RI )ORULGD LQ JUDGHV 3UH. WR 7KH &RQVHQW 'HFUHH ZDV LQFRUSRUDWHG LQWR )ORULGD 6WDWXWHV f DQG 6WDWH %RDUG RI (GXFDWLRQ 5XOHV $ $f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f§ 6DQGUD + )UDGG DQG 2NKHH /HH f &UHDWLQJ )ORULGDfV 0XOWLOLQJXDO *OREDO :RUNIRUFH 7DOODKDVVHH )/ )ORULGD 'HSDUWPHQW RI (GXFDWLRQ

PAGE 145

f Df$OO FKLOGUHQ ZKR KDYH DWWDLQHG WKH DJH RI \HDUV RU ZKR ZLOO KDYH DWWDLQHG WKH DJH RI \HDUV E\ )HEUXDU\ RI DQ\ VFKRRO \HDU RU ZKR DUH ROGHU WKDQ \HDUV RI DJH EXW ZKR KDYH QRW DWWDLQHG WKH DJH RI \HDUV H[FHSW DV KHUHLQDIWHU SURYLGHG DUH UHTXLUHG WR DWWHQG VFKRRO UHJXODUO\ GXULQJ WKH HQWLUH VFKRRO WHUP +RPHOHVV FKLOGUHQ DV GHILQHG LQ V PXVW KDYH DFFHVV WR D IUHH SXEOLF HGXFDWLRQ DQG PXVW EH DGPLWWHG WR VFKRRO LQ WKH VFKRRO GLVWULFW LQ ZKLFK WKH\ DQG WKHLU IDPLOLHV OLYH 6FKRRO GLVWULFWV VKDOO DVVLVW KRPHOHVV FKLOGUHQ WR PHHW WKH UHTXLUHPHQWV RI i DQG DV ZHOO DV ORFDO UHTXLUHPHQWV IRU GRFXPHQWDWLRQ (QJOLVK /DQJXDJH ,QVWUXFWLRQ IRU OLPLWHG (QJOLVK SURILFLHQW VWXGHQWV f§ f ,QVWUXFWLRQ LQ WKH (QJOLVK ODQJXDJH VKDOO EH SURYLGHG WR OLPLWHG (QJOLVK SURILFLHQW VWXGHQWV 6XFK LQVWUXFWLRQ VKDOO EH GHVLJQHG WR GHYHORS WKH VWXGHQWfV PDVWHU\ RI WKH IRXU ODQJXDJH VNLOOV LQFOXGLQJ OLVWHQLQJ VSHDNLQJ UHDGLQJ DQG ZULWLQJ DV UDSLGO\ DV SRVVLEOH /LPLWHG (QJOLVK SURILFLHQW VWXGHQWV ZKR DUH HOLJLEOH RWKHU FDWHJRULFDO RU VSHFLDO SURJUDPV VXFK V &KDSWHU DQG H[FHSWLRQDO VWXGHQW HGXFDWLRQ VKDOO DOVR SDUWLFLSDWH LQ VXFK VHUYLFHV LQ DFFRUGDQFH ZLWK WKH UHTXLUHPHQWV RI WKH UHVSHFWLYH SURJUDP f (DFK VFKRRO GLVWULFW VKDOO LPSOHPHQW WKH IROORZLQJ SURFHGXUHV Df 'HYHORS DQG VXEPLW D GLVWULFW SODQ IRU SURYLGLQJ (QJOLVK ODQJXDJH LQVWUXFWLRQ IRU OLPLWHG (QJOLVK SURILFLHQW VWXGHQWV WR WKH 'HSDUWPHQW RI (GXFDWLRQ IRU UHYLHZ DQG DSSURYDO Ef ,GHQWLI\ OLPLWHG (QJOLVK VWXGHQWV WKURXJK DVVHVVPHQW Ff 3URYLGH IRU VWXGHQW H[LW IURP DQG UHFODVVLILFDWLRQ LQWR WKH SURJUDP Gf 3URYLGH OLPLWHG (QJOLVK SURILFLHQW VWXGHQWV (62/ LQVWUXFWLRQ LQ (QJOLVK DQG (62/ )ORULGD 'HSDUWPHQW RI (GXFDWLRQ )ORULGD 6FKRRO /DZV &KDSWHU )ORULGD 6WDWXWHV ,ELG

PAGE 146

LQVWUXFWLRQ RU KRPH ODQJXDJH LQVWUXFWLRQ LQ WKH EDVLF VXEMHFW DUHDV RI PDWKHPDWLFV VFLHQFH VRFLDO VWXGLHV DQG FRPSXWHU OLWHUDF\ Hf 0DLQWDLQ D VWXGHQW SODQ 3URYLGH TXDOLILHG WHDFKHUV Jf 3URYLGH HTXDO DFFHVV WR RWKHU SURJUDPV IRU HOLJLEOH OLPLWHG (QJOLVK SURILFLHQW VWXGHQWV EDVHG RQ QHHG Kf 3URYLGH IRU SDUHQW LQYROYHPHQW LQ WKH SURJUDP )ORULGDfV (GXFDWLRQ 6WUDWHJLF 3ULRULWLHV 7KH PLVVLRQ RI )ORULGDn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nV VFKRRO VLWHV DQG VHWWLQJV ZHUH VDIH DQG VHFXUH SODFHV LQ ZKLFK WR OHDUQ ,ELG &KDSWHU 2IILFH RI 2UJDQL]DWLRQDO DQG (PSOR\HH 'HYHORSPHQW )ORULGD 'HSDUWPHQW RI (GXFDWLRQ f ,ELG ,ELG

PAGE 147

3ULRULW\ ,VVXH ,QFUHDVHG *RYHUQPHQW (IILFLHQF\ )ORULGDn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f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f *UHDWHU VWDII SDUWLFLSDWLRQ LQ WUDLQLQJ GLUHFWHG WRZDUG XQGHUVWDQGLQJ RI WKH VSHFLDO QHHGV RI LPPLJUDQW FKLOGUHQ ,ELG

PAGE 148

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f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f $VVHVVPHQW LQVWUXPHQWV LQ ODQJXDJHV RWKHU WKDQ (QJOLVK DQG 6SDQLVK

PAGE 149

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f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f +LVSDQLF VWXGHQWV SHUFHQWf $VLDQ DQG 3DFLILF

PAGE 150

,VODQGHU VWXGHQWV SHUFHQWf DQG 1DLYH $PHULFDQ VWXGHQWV SHUFHQWf 6FKRRO FRXQVHOLQJ VWDIIV ZHUH FRPSRVHG PRVWO\ RI ZKLWH RU EODFN ZRPHQ ,QFHQWLYHV ZHUH QHHGHG WR HQWLFH PRUH +LVSDQLFV DQG PHQ LQWR WKH VFKRRO FRXQVHOLQJ ILHOG f ,QFUHDVHG LPPLJUDQW SDUHQW LQYROYHPHQW LQ RYHUDOO VFKRRO SURJUDPV $ SUHOXGH WR PRUH HIIHFWLYH SDUHQW LQYROYHPHQW SURJUDPV VKRXOG KDYH LQFOXGHG D FDUHIXO H[DPLQDWLRQ RI ZKDW ZDV DFWXDOO\ NQRZQ DERXW FXOWXUDOO\ GLIIHUHQW IDPLOLHV WKHLU DWWLWXGHV UHJDUGLQJ HGXFDWLRQ DQG KRZ WKH\ VXSSRUWHG WKHLU FKLOGUHQfV HGXFDWLRQ WKURXJK WKH IDPLO\ DQG WKHLU LQIRUPDO VRFLDO QHWZRUNV ,W ZDV LPSRUWDQW WR KHOS WKH LPPLJUDQW SDUHQW WR XQGHUVWDQG WKH 86 HGXFDWLRQDO V\VWHP ,PPLJUDQW SDUHQWV RIWHQ FDPH IURP FXOWXUHV ZKHUH WKH SURSHU UROH RI WKH FRQFHUQHG SDUHQW ZDV QRQn LQWHUYHQWLRQLVW LQ QDWXUH 3DUHQWV IURP VXFK EDFNJURXQG EHOLHYHG WKH\ VKRXOG QRW LQWHUYHQH LQ WKH VFKRROfV EXVLQHVV RU TXHVWLRQ WKH WHDFKHUfV SUDFWLFHV DQG H[SHUWLVH 0RVW +LVSDQLF SDUHQWV IHOW SDUHQW LQWHUYHQWLRQ FRQVWLWXWHG RI LQWHUIHUHQFH LQ WKH DIIDLUV RI WKH VFKRRO 0DQ\ GLG QRW XQGHUVWDQG WKDW WKH\ ZHUH H[SHFWHG WR LQWHUDFW ZLWK VFKRROV WR VKRZ WKDW WKH\ YDOXHG HGXFDWLRQ DQG ZDQWHG WKHLU FKLOGUHQ WR OHDUQ $V WKHLU FKLOGUHQ DGDSWHG LQWR WKH $PHULFDQ HGXFDWLRQ FXOWXUH LW ZDV FRQVLGHUHG QHFHVVDU\ E\ WKH VFKRRO VWDIIV WR KDYH FRQWDFW ZLWK WKH LPPLJUDQW SDUHQWV $OWKRXJK PDQ\ GLVWULFWV KDG SDUHQW LQYROYHPHQW SURJUDPV FRQYLQFLQJ WKH $QQLH ( &DVH\ )RXQGDWLRQ .LGV &RXQW 86$ 3URILOH %DOWLPRUH 0DU\ODQG $QQLH ( &DVH\ )RXQGDWLRQ 3DP 0F&ROOXP 2EVWDFOHV WR ,PPLJUDQW 3DUHQW 3DUWLFLSDWLRQ LQ 6FKRROV ,QWHUFXOWXUDO 'HYHORSPHQW 5HVHDUFK $VVRFLDWLRQ 1HZVOHWWHU ,'5$f 1RYHPEHU'HFHPEHU

PAGE 151

LPPLJUDQW SDUHQW WKDW LQYROYHPHQW LQ WKHLU FKLOGUHQf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f IRUPHU FRXQWULHV 3DUHQWV ZHUH LQYLWHG WR DWWHQG DWKOHWLF DFDGHPLF DQG SHUIRUPLQJ DUWV DFWLYLWLHV (YHU\WKLQJ QHHGHG WR EH GRQH WR HQVXUH WKDW WKH VFKRRO ZDV SHUFHLYHG DV D VDIH QRQWKUHDWHQLQJ KDYHQ ZKHUH WKH SDUHQW FRXOG EH LQFOXGHG LQ WKH HGXFDWLRQ RI WKHLU FKLOGUHQ f ,QFOXVLRQ RI OLPLWHG (QJOLVK SURILFLHQW FKLOGUHQ LQ DOO VFKRROZLGH SURJUDPV :LWK VR PDQ\ /(3 VWXGHQWV LQ )ORULGD DQG ZLWK D KHDYLHU FRQFHQWUDWLRQ LQ VRPH FRXQWLHV PRUH WKDQ RWKHUV SURYLVLRQV ZHUH QHHGHG WR DFFRPPRGDWH WKH LQFOXVLRQ RI /(3 VWXGHQWV LQ VFKRROZLGH SURJUDPV ,W ZDV GLIILFXOW IRU D VWXGHQW WR IHHO SDUW RI VRPHWKLQJ ZKHQ WKH\ FRXOG QRW XQGHUVWDQG

PAGE 152

ZKDW ZDV EHLQJ VDLG RU GRQH (QJOLVK ODQJXDJH LQWHUSUHWHUV DQG VWXGHQWV ZKR ZHUH DOUHDG\ ELOLQJXDO DVVLVWHG LQ WKLV HIIRUW 6WXGHQW WR VWXGHQW PHQWRULQJ ZDV DQRWKHU JRRG PHWKRG RI FRQQHFWLQJ LPPLJUDQW VWXGHQWV WR WKH RYHUDOO VFKRRO FXOWXUH 0L[HG JURXS G\QDPLFV DV PHPEHUV RI WKH VDPH WHDP DOVR KHOSHG WR RYHUFRPH VRPH FXOWXUDO ELDVHV ,W ZDV LQKHUHQWO\ GLIILFXOW WR PRYH WKHVH FKLOGUHQ ZLWK JURXSV RWKHU WKDQ WKH RQH ZKHUH WKH\ IHOW PRVW FRPIRUWDEOH f 'HWHUPLQH ZKDW LQYHVWPHQWV WKH SXEOLF ZDV ZLOOLQJ WR PDNH WR HQVXUH WKH HGXFDWLRQ DQG IXWXUH HFRQRPLF VXFFHVV RI LPPLJUDQW FKLOGUHQ &RQYLQFLQJ WD[SD\LQJ SXEOLF WR LQFUHDVH HGXFDWLRQ VSHQGLQJ ZDV D PRQXPHQWDO WDVN 0DQ\ RI )ORULGDf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f ,PPLJUDQW &KLOGUHQ DQG 7KHLU )DPLOLHV ,VVXHV IRU 5HVHDUFK DQG 3ROLF\ 7KH )XWXUH RI &KLOGUHQ 9RO 1R 6XPPHU)DOO

PAGE 153

VXSSRUW WKLV QHHG IRU SXEOLF HGXFDWLRQ SODQV ZHUH QHHGHG WR LQYROYH WD[SD\HUV HVS UHWLUHHV IURP WKH JURXQG XS LVVXH E\ LVVXH LQ DGGUHVVLQJ WKRVH QHHGV DQG LQ GHWHUPLQLQJ OHDVWFRVW VROXWLRQV DQG UHVSRQVLEOH XVH RI IXQGV $GGLWLRQDO VWUDWHJLHV OLNH 6FKRROWR:RUN WKDW SURYLGHG FDUHHU H[SORUDWLRQ DFWLYLWLHV DV WKH\ UHODWHG WR SRVWVHFRQGDU\ HGXFDWLRQ QHHGHG WR EH GHYHORSHG WR HQFRXUDJH LPPLJUDQW \RXWKV DJHV WR SXUVXH WKHLU VHFRQGDU\ HGXFDWLRQ 3ROLFLHV VKRXOG EH DEOH WR DGGUHVV LPPLJUDQW VWXGHQWVf VSHFLDO QHHGV ZLWKLQ WKH FRQWH[W RI HGXFDWLRQ UHIRUP HIIRUWV HPSKDVL]LQJ V\VWHPLF LQLWLDWLYHV WR LPSURYH HGXFDWLRQDO RXWFRPHV IRU DOO FKLOGUHQ )DLOXUH WR GR VR ZRXOG UHVXOW LQ KXQGUHGV RI WKRXVDQGV RI \RXQJ SHRSOH ZLWKRXW D KLJK VFKRRO GLSORPD DQG ZLWKRXW SURVSHFWV IRU HFRQRPLF PRELOLW\ RYHU WKHLU OLIHWLPH 6XPPDU\ 3XEOLF HGXFDWLRQ ZDV QRW D fULJKWf JUDQWHG WR LQGLYLGXDOV E\ WKH &RQVWLWXWLRQ %XW QHLWKHU ZDV LW PHUHO\ VRPH JRYHUQPHQWDO fEHQHILWf LQGLVWLQJXLVKDEOH IURP RWKHU IRUPV RI VRFLDO ZHOIDUH OHJLVODWLRQ %RWK WKH LPSRUWDQFH RI HGXFDWLRQ LQ PDLQWDLQLQJ RXU EDVLF LQVWLWXWLRQV DQG WKH ODVWLQJ LPSDFW RI LWV GHSULYDWLRQ RQ WKH OLIH RI WKH FKLOG PDUNHG WKH GLVWLQFWLRQ 7KH f$PHULFDQ SHRSOH KDG DOZD\V UHJDUGHG HGXFDWLRQ DQG >WKH@ DFTXLVLWLRQ RI NQRZOHGJH DV PDWWHUV RI VXSUHPH LPSRUWDQFHf 7KH\ UHFRJQL]HG fWKH SXEOLF VFKRROV DV D PRVW YLWDO FLYLF LQVWLWXWLRQ IRU WKH SUHVHUYDWLRQ RI D GHPRFUDWLF V\VWHP 6DQ $QWRQLR ,QGHSHQGHQW 6FKRRO 'LVWULFW Y 5RGULJXH] 86 f 0H\HU Y 1HEUDVND 86 f

PAGE 154

RI JRYHUQPHQW DQG DV WKH SULPDU\ YHKLFOH IRU WUDQVPLWWLQJ WKH YDOXHV RQ ZKLFK RXU VRFLHW\ UHVWVf (DUO\ LQ RXU KLVWRU\ VRPH GHJUHH RI HGXFDWLRQ ZDV QHFHVVDU\ WR SUHSDUH FLWL]HQV WR HIIHFWLYHO\ DQG LQWHOOLJHQWO\ SDUWLFLSDWH LQ RXU RSHQ SROLWLFDO V\VWHP LI ZH ZHUH WR SUHVHUYH IUHHGRP DQG LQGHSHQGHQFH 7KHVH KLVWRULF SHUFHSWLRQV RI WKH SXEOLF VFKRROV DV LQVWLOOLQJ WKH IXQGDPHQWDO YDOXHV QHFHVVDU\ WR WKH PDLQWHQDQFH RI D GHPRFUDWLF SROLWLFDO V\VWHP ZHUH FRQILUPHG E\ WKH REVHUYDWLRQV RI VRFLDO VFLHQWLVWV ,Q DGGLWLRQ HGXFDWLRQ SURYLGHG WKH EDVLF WRROV E\ ZKLFK LQGLYLGXDOV PLJKW OHDG HFRQRPLFDOO\ SURGXFWLYH OLYHV WR WKH EHQHILW RI XV DOO ,Q VXP HGXFDWLRQ KDG D IXQGDPHQWDO UROH LQ PDLQWDLQLQJ WKH IDEULF RI RXU VRFLHW\ :H GLG QRW LJQRUH WKH VLJQLILFDQW VRFLDO FRVWV ERUQH E\ RXU 1DWLRQ ZKHQ VHOHFW JURXSV ZHUH GHQLHG WKH PHDQV WR DEVRUE WKH YDOXHV DQG VNLOOV XSRQ ZKLFK RXU VRFLDO RUGHU UHVWV :KLOH PRVW FKLOGUHQ RI LPPLJUDQWV ZHUH GRLQJ ZHOO D SRUWLRQ ZDV LQGHHG fIDOOLQJ WKURXJK WKH FUDFNVf 7KH SRSXODWLRQ WKDW FRQWLQXHG WR KDYH OLPLWHG (QJOLVK SURILFLHQF\ /(3Vf ZDV DV D JURXS QRW VLPSO\ OHVV FDSDEOH OLQJXLVWLFDOO\ WKDQ RWKHU VWXGHQWV 5DWKHU WKH\ EHORQJHG WR D GLIIHUHQW DQG PRUH YXOQHUDEOH JURXS WKDQ WKH PDMRULW\ RI WKHLU SHHUV 7KH\ KDG RQH RU ERWK SDUHQWV XQHPSOR\HG SDUHQWV ZKR PD\ KDYH HQWHUHG WKH FRXQWU\ LOOHJDOO\ OLYHG LQ SRRUHU QHLJKERUKRRGV ZHUH PRUH OLNHO\ WR KDYH JURZQ XS LQ IHPDOHKHDGHG KRXVHKROGV DQG KRXVHKROGV ZLWK KLJKHU OHYHOV RI FRQIOLFW DQG WHQGHG WR EH $ELQJWRQ 6FKRRO 'LVWULFW Y 6FKHPSS 86 f %5(11$1 FRQFXUULQJf $PEDFK Y 1RUZLFN 86 f :LVFRQVLQ Y
PAGE 155

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f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

PAGE 156

$33(1',; 3O\OHU 9 'RH > 86 @ 23,1,216 2) 7+( &2857 %5(11$1 GHOLYHUHG WKH RSLQLRQ RI WKH &RXUW LQ ZKLFK 0$56+$// %/$&.081 32:(// DQG 67(9(16 -/ MRLQHG 0$56+$// SRVW S %/$&.081 SRVW S DQG 32:(// SRVW S ILOHG FRQFXUULQJ RSLQLRQV %85*(5 &ILOHG D GLVVHQWLQJ RSLQLRQ LQ ZKLFK :+,7( 5(+148,67 DQG 2n&21125 --f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fOHJDOO\ 86& 86& HG DQG 6XSS ,9f

PAGE 157

DGPLWWHGf LQWR WKH 8QLWHG 6WDWHV 7KH UHYLVLRQ DOVR DXWKRUL]HG ORFDO VFKRRO GLVWULFWV WR GHQ\ HQUROOPHQW LQ WKHLU SXEOLF VFKRROV WR FKLOGUHQ QRW OHJDOO\ DGPLWWHG WR WKH FRXQWU\ 7KHVH FDVHV LQYROYH FRQVWLWXWLRQDO FKDOOHQJHV WR WKRVH SURYLVLRQV > 86 @ 7KDW VHFWLRQ SURYLGHV LQ SHUWLQHQW SDUW fDf $OO FKLOGUHQ ZKR DUH FLWL]HQV RI WKH 8QLWHG 6WDWHV RU OHJDOO\ DGPLWWHG DOLHQV DQG ZKR DUH RYHU WKH DJH RI ILYH \HDUV DQG XQGHU WKH DJH RI \HDUV RQ WKH ILUVW GD\ RI 6HSWHPEHU RI DQ\ VFKRODVWLF \HDU VKDOO EH HQWLWOHG WR WKH EHQHILWV RI WKH $YDLODEOH 6FKRRO )XQG IRU WKDW \HDU fEf (YHU\ FKLOG LQ WKLV VWDWH ZKR LV D FLWL]HQ RI WKH 8QLWHG 6WDWHV RU D OHJDOO\ DGPLWWHG DOLHQ DQG ZKR LV RYHU WKH DJH RI ILYH \HDUV DQG QRW RYHU WKH DJH RI \HDUV RQ WKH ILUVW GD\ RI 6HSWHPEHU RI WKH \HDU LQ ZKLFK DGPLVVLRQ LV VRXJKW VKDOO EH SHUPLWWHG WR DWWHQG WKH SXEOLF IUHH VFKRROV RI WKH GLVWULFW LQ ZKLFK KH UHVLGHV RU LQ ZKLFK KLV SDUHQW JXDUGLDQ RU WKH SHUVRQ KDYLQJ ODZIXO FRQWURO RI KLP UHVLGHV DW WKH WLPH KH DSSOLHV IRU DGPLVVLRQ fFf 7KH ERDUG RI WUXVWHHV RI DQ\ SXEOLF IUHH VFKRRO GLVWULFW RI WKLV VWDWH VKDOO DGPLW LQWR WKH SXEOLF IUHH VFKRROV RI WKH GLVWULFW IUHH RI WXLWLRQ DOO SHUVRQV ZKR DUH HLWKHU FLWL]HQV RI WKH 8QLWHG 6WDWHV RU OHJDOO\ DGPLWWHG DOLHQV DQG ZKR DUH RYHU ILYH DQG QRW RYHU \HDUV RI DJH DW WKH EHJLQQLQJ RI WKH VFKRODVWLF \HDU LI VXFK SHUVRQ RU KLV SDUHQW JXDUGLDQ RU SHUVRQ KDYLQJ ODZIXO FRQWURO UHVLGHV ZLWKLQ WKH VFKRRO GLVWULFWf 3O\OHU Y 'RH ZDV D FODVV DFWLRQ ILOHG LQ WKH 8QLWHG 6WDWHV 'LVWULFW &RXUW IRU WKH (DVWHUQ 'LVWULFW RI 7H[DV LQ 6HSWHPEHU RQ EHKDOI RI FHUWDLQ VFKRRODJH FKLOGUHQ RI 0H[LFDQ RULJLQ UHVLGLQJ LQ 6PLWK &RXQW\ 7H[DV ZKR FRXOG QRW HVWDEOLVK WKDW WKH\ KDG >7H[DV (GXFDWLRQ &RGH $QQ 9HUQRQ 6XSSf 'HVSLWH WKH HQDFWPHQW RI LQ WKH 6FKRRO 'LVWULFW KDG FRQWLQXHG WR HQUROO XQGRFXPHQWHG FKLOGUHQ IUHH RI FKDUJH XQWLO WKH VFKRRO \HDU ,Q -XO\ LW DGRSWHG D SROLF\ UHTXLULQJ XQGRFXPHQWHG FKLOGUHQ WR SD\ D fIXOO WXLWLRQ IHHf LQ RUGHU WR HQUROO 6HFWLRQ KDG QRW SURYLGHG D GHILQLWLRQ RI fD OHJDOO\ DGPLWWHG DOLHQf 7\OHU RIIHUHG WKH IROORZLQJ FODULILFDWLRQ f$ OHJDOO\ DGPLWWHG DOLHQ LV RQH ZKR KDV GRFXPHQWDWLRQ WKDW KH RU VKH LV OHJDOO\ LQ WKH 8QLWHG 6WDWHV RU D SHUVRQ ZKR LV LQ WKH SURFHVV RI VHFXULQJ GRFXPHQWDWLRQ IURP WKH 8QLWHG 6WDWHV ,PPLJUDWLRQ 6HUYLFH DQG WKH 6HUYLFH ZLOO VWDWH WKDW WKH SHUVRQ LV EHLQJ SURFHVVHG DQG ZLOO EH DGPLWWHG ZLWK SURSHU GRFXPHQWDWLRQf $SS WR -XULV 6WDWHPHQW LQ 1R S $ (G@ 86 1R 3O\OHU Y 'RH

PAGE 158

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n PRWLRQ IRU SHUPDQHQW LQMXQFWLYH UHOLHI >86 ,Q FRQVLGHULQJ WKLV PRWLRQ WKH 'LVWULFW &RXUW PDGH H[WHQVLYH ILQGLQJV RI IDFW 7KH FRXUW IRXQG WKDW QHLWKHU 6HFWLRQ RI WKH 7H[DV (GXFDWLRQ &RGH QRU WKH 6FKRRO 'LVWULFW SROLF\ LPSOHPHQWLQJ LW KDG fHLWKHU WKH SXUSRVH RU HIIHFW RI NHHSLQJ LOOHJDO DOLHQV RXW RI WKH 6WDWH RI 7H[DVf 5HVSHFWLQJ GHIHQGDQWVn IXUWKHU FODLP WKDW ZDV VLPSO\ D ILQDQFLDO PHDVXUH GHVLJQHG WR DYRLG D GUDLQ RQ WKH 6WDWHnV ILVF WKH FRXUW UHFRJQL]HG WKDW WKH LQFUHDVHV LQ SRSXODWLRQ UHVXOWLQJ IURP WKH LPPLJUDWLRQ RI 0H[LFDQ QDWLRQDOV LQWR WKH 8QLWHG 6WDWHV KDG FUHDWHG SUREOHPV IRU WKH SXEOLF VFKRROV RI WKH 6WDWH DQG WKDW WKHVH SUREOHPV ZHUH H[DFHUEDWHG E\ WKH VSHFLDO HGXFDWLRQDO QHHGV RI LPPLJUDQW 0H[LFDQ FKLOGUHQ 7KH FRXUW QRWHG KRZHYHU WKDW WKH LQFUHDVH LQ VFKRRO HQUROOPHQW ZDV SULPDULO\ r DWWULEXWDEOH WR WKH DGPLVVLRQ RI FKLOGUHQ ZKR ZHUH OHJDO UHVLGHQWV ,W DOVR IRXQG WKDW )6XSS f ,ELG SS >3ODLQWLIIVn H[SHUW 'U *LOEHUW &DUGHQDV WHVWLILHG fILIW\ WR VL[W\ SHU FHQW RI FXUUHQW OHJDO DOLHQ ZRUNHUV ZHUH IRUPHUO\ LOOHJDO DOLHQVf ,ELG S $ GHIHQVH ZLWQHVV 5RODQ +HVWRQ 'LVWULFW 'LUHFWRU RI WKH +RXVWRQ 'LVWULFW RI WKH ,PPLJUDWLRQ DQG 1DWXUDOL]DWLRQ 6HUYLFH WHVWLILHG WKDW XQGRFXPHQWHG FKLOGUHQ FDQ DQG GR OLYH LQ WKH 8QLWHG 6WDWHV IRU \HDUV DQG DGMXVW WKHLU VWDWXV WKURXJK PDUULDJH WR D FLWL]HQ RU SHUPDQHQW UHVLGHQW ,ELG 7KH FRXUW DOVR WRRN QRWLFH RI FRQJUHVVLRQDO SURSRVDOV WR fOHJDOL]Hf WKH VWDWXV RI PDQ\ XQODZIXO HQWUDQWV ,ELG SS 6HH DOVR Q LQIUD (G@

PAGE 159

ZKLOH WKH fH[FOXVLRQ RI DOO XQGRFXPHQWHG FKLOGUHQ IURP WKH SXEOLF VFKRROV LQ 7H[DV ZRXOG HYHQWXDOO\ UHVXOW LQ HFRQRPLHV DW VRPH OHYHOf IXQGLQJ IURP ERWK WKH 6WDWH DQG )HGHUDO *RYHUQPHQWV ZDV EDVHG SULPDULO\ RQ WKH QXPEHU RI FKLOGUHQ HQUROOHG ,Q QHW HIIHFW WKHQ EDUULQJ XQGRFXPHQWHG FKLOGUHQ IURP WKH VFKRROV ZRXOG VDYH PRQH\ EXW LW R ZRXOG fQRW QHFHVVDULO\f LPSURYH fWKH TXDOLW\ RI HGXFDWLRQf 7KH FRXUW IXUWKHU REVHUYHG WKDW WKH LPSDFW RI ZDV ERUQH SULPDULO\ E\ D YHU\ VPDOO VXEFODVV RI LOOHJDO DOLHQV fHQWLUH IDPLOLHV ZKR KDYH PLJUDWHG LOOHJDOO\ DQG f§ IRU DOO SUDFWLFDO SXUSRVHV f§ SHUPDQHQWO\ WR WKH 8QLWHG 6WDWHVf )LQDOO\ WKH FRXUW QRWHG WKDW XQGHU FXUUHQW ODZV DQG SUDFWLFHV fWKH LOOHJDO DOLHQ RI WRGD\ PD\ ZHOO EH WKH OHJDO DOLHQ RI WRPRUURZf DQG WKDW ZLWKRXW DQ HGXFDWLRQ WKHVH XQGRFXPHQWHG FKLOGUHQ DOUHDG\ GLVDGYDQWDJHG DV D UHVXOW RI SRYHUW\ ODFN RI (QJOLVKVSHDNLQJ DELOLW\ DQG XQGHQLDEOH UDFLDO SUHMXGLFHV ZLOO EHFRPH SHUPDQHQWO\ ORFNHG LQWR WKH ORZHVW VRFLRHFRQRPLF FODVV 7KH 'LVWULFW &RXUW KHOG WKDW LOOHJDO DOLHQV ZHUH HQWLWOHG WR WKH SURWHFWLRQ RI WKH (TXDO 3URWHFWLRQ &ODXVH RI WKH )RXUWHHQWK $PHQGPHQW DQG WKDW YLRODWHG WKDW &ODXVH 6XJJHVWLQJ WKDW WKH VWDWHnV H[FOXVLRQ RI XQGRFXPHQWHG FKLOGUHQ IURP LWV SXEOLF VFKRROV PD\ ZHOO EH WKH W\SH RI LQYLGLRXVO\ PRWLYDWHG VWDWH DFWLRQ IRU ZKLFK WKH VXVSHFW FODVVLILFDWLRQ GRFWULQH ZDV GHVLJQHG WKH FRXUW KHOG WKDW LW ZDV XQQHFHVVDU\ WR GHFLGH ZKHWKHU WKH VWDWXWH ZRXOG VXUYLYH D fVWULFW VFUXWLQ\f DQDO\VLV EHFDXVH LQ DQ\ ,ELG S ,ELG S ,ELG S ,ELG S

PAGE 160

HYHQW WKH GLVFULPLQDWLRQ HPERGLHG LQ WKH VWDWXWH ZDV QRW VXSSRUWHG E\ D UDWLRQDO EDVLV 7KH 'LVWULFW &RXUW DOVR FRQFOXGHG WKDW WKH 7H[DV VWDWXWH YLRODWHG WKH 6XSUHPDF\ &ODXVH 7KH &RXUW RI $SSHDOV IRU WKH )LIWK &LUFXLW XSKHOG WKH 'LVWULFW &RXUWnV LQMXQFWLRQ 7KH &RXUW RI $SSHDOV KHOG WKDW WKH 'LVWULFW &RXUW KDG HUUHG LQ ILQGLQJ WKH 7H[DV VWDWXWH SUHHPSWHG E\ IHGHUDO ODZ :LWK UHVSHFW WR > 86 @ HTXDO SURWHFWLRQ KRZHYHU WKH &RXUW RI $SSHDOV DIILUPHG LQ DOO HVVHQWLDO UHVSHFWV WKH DQDO\VLV RI WKH 'LVWULFW &RXUW FRQFOXGLQJ WKDW ZDV fFRQVWLWXWLRQDOO\ LQILUP UHJDUGOHVV RI ZKHWKHU LW ZDV WHVWHG XVLQJ WKH PHUH UDWLRQDO EDVLV VWDQGDUG RU VRPH PRUH VWULQJHQW WHVWf :H QRWHG SUREDEOH MXULVGLFWLRQ 'XULQJ DQG VXLWV FKDOOHQJLQJ WKH FRQVWLWXWLRQDOLW\ RI DQG YDULRXV ORFDO SUDFWLFHV XQGHUWDNHQ RQ WKH DXWKRULW\ RI WKDW SURYLVLRQ ZHUH ILOHG LQ WKH 8QLWHG 6WDWHV 'LVWULFW &RXUWV IRU WKH 6RXWKHUQ :HVWHUQ DQG 1RUWKHUQ 'LVWULFWV RI 7H[DV (DFK VXLW QDPHG WKH 6WDWH RI 7H[DV DQG WKH 7H[DV (GXFDWLRQ $JHQF\ DV GHIHQGDQWV DORQJ ZLWK ORFDO RIILFLDOV ,Q 1RYHPEHU WKH -XGLFLDO 3DQHO RQ 0XOWLGLVWULFW /LWLJDWLRQ f ,ELG S ,ELG SS >7KH FRXUW IRXQG LQFRQVLVWHQW ZLWK WKH VFKHPH RI QDWLRQDO UHJXODWLRQ XQGHU WKH ,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW DQG ZLWK IHGHUDO ODZV SHUWDLQLQJ WR IXQGLQJ DQG GLVFULPLQDWLRQ LQ HGXFDWLRQ 7KH FRXUW GLVWLQJXLVKHG 'H &DQDV Y %LFD 86 f E\ HPSKDVL]LQJ WKDW WKH VWDWH EDU RQ HPSOR\PHQW RI LOOHJDO DOLHQV LQYROYHG LQ WKDW FDVH PLUURUHG SUHFLVHO\ WKH IHGHUDO SROLF\ RI SURWHFWLQJ WKH GRPHVWLF ODERU PDUNHW XQGHUO\LQJ WKH LPPLJUDWLRQ ODZV 7KH FRXUW GLVFHUQHG QR H[SUHVV IHGHUDO SROLF\ WR EDU LOOHJDO LPPLJUDQWV IURP HGXFDWLRQ )6XSS SS (G@ )G f ,ELG SS ,ELG S 86 f 1R ,Q UH $OLHQ &KLOGUHQ (GXFDWLRQ /LWLJDWLRQ >7KH &RXUW RI $SSHDOV QRWHG WKDW 'H &DQDV Y %LFD KDG QRW IRUHFORVHG DOO VWDWH UHJXODWLRQ ZLWK UHVSHFW WR LOOHJDO DOLHQV DQG IRXQG QR H[SUHVV RU LPSOLHG FRQJUHVVLRQDO SROLF\ IDYRULQJ WKH HGXFDWLRQ RI LOOHJDO DOLHQV 7KH FRXUW WKHUHIRUH FRQFOXGHG WKDW WKHUH ZDV QR SUHHPSWLYH FRQIOLFW EHWZHHQ VWDWH DQG IHGHUDO ODZ )G SS (G@

PAGE 161

RQ PRWLRQ RI WKH 6WDWH FRQVROLGDWHG WKH FODLPV DJDLQVW WKH VWDWH RIILFLDOV LQWR D VLQJOH DFWLRQ WR EH KHDUG LQ WKH 'LVWULFW &RXUW IRU WKH 6RXWKHUQ 'LVWULFW RI 7H[DV $ KHDULQJ ZDV FRQGXFWHG LQ )HEUXDU\ DQG 0DUFK ,Q -XO\ WKH FRXUW HQWHUHG DQ RSLQLRQ DQG RUGHU KROGLQJ WKDW YLRODWHG WKH (TXDO 3URWHFWLRQ &ODXVH RI WKH )RXUWHHQWK $PHQGPHQW 7KH FRXUW KHOG WKDW WKH DEVROXWH GHSULYDWLRQ RI HGXFDWLRQ VKRXOG WULJJHU VWULFW MXGLFLDO VFUXWLQ\ SDUWLFXODUO\ ZKHQ WKH DEVROXWH GHSULYDWLRQ LV WKH UHVXOW RI FRPSOHWH LQDELOLW\ WR SD\ IRU WKH GHVLUHG EHQHILW 7KH FRXUW GHWHUPLQHG WKDW WKH 6WDWHnV FRQFHUQ IRU ILVFDO LQWHJULW\ ZDV QRW D FRPSHOOLQJ VWDWH LQWHUHVW WKDW H[FOXVLRQ RI WKHVH FKLOGUHQ KDG QRW EHHQ VKRZQ WR EH QHFHVVDU\ WR LPSURYH HGXFDWLRQ ZLWKLQ WKH VWDWH DQG WKDW WKH HGXFDWLRQDO QHHGV RI WKH FKLOGUHQ VWDWXWRULO\ H[FOXGHG ZHUH QRW GLIIHUHQW IURP WKH QHHGV RI FKLOGUHQ QRW H[FOXGHG 7KH FRXUW WKHUHIRUH FRQFOXGHG WKDW > 86 @ ZDV QRW FDUHIXOO\ WDLORUHG WR DGYDQFH WKH DVVHUWHG VWDWH LQWHUHVW LQ DQ DFFHSWDEOH PDQQHU :KLOH DSSHDO RI WKH 'LVWULFW &RXUWnV GHFLVLRQ ZDV SHQGLQJ WKH &RXUW RI $SSHDOV UHQGHUHG LWV GHFLVLRQ LQ 1R $SSDUHQWO\ RQ WKH VWUHQJWK RI WKDW RSLQLRQ WKH &RXUW RI $SSHDOV RQ )HEUXDU\ VXPPDULO\ DIILUPHG WKH GHFLVLRQ RI WKH 6RXWKHUQ 'LVWULFW :H QRWHG SUREDEOH MXULVGLFWLRQ DQG FRQVROLGDWHG WKLV FDVH ZLWK 1R IRU EULHILQJ DQG DUJXPHQW ,Q UH $OLHQ &KLOGUHQ (GXFDWLRQ /LWLJDWLRQ )6XSS >7KH FRXUW FRQFOXGHG WKDW ZDV QRW SUHHPSWHG E\ IHGHUDO ODZV RU LQWHUQDWLRQDO DJUHHPHQWV )6XSS SS (G@ ,ELG S ,ELG SS 86 86 f >$SSHOOHHV LQ ERWK FDVHV FRQWLQXH WR SUHVV WKH DUJXPHQW WKDW LV SUHHPSWHG E\ IHGHUDO ODZ DQG SROLF\ ,Q OLJKW RI WKH GLVSRVLWLRQ RI WKH )RXUWHHQWK $PHQGPHQW LVVXH ZH KDYH QR RFFDVLRQ WR UHDFK WKLV FODLP (G@

PAGE 162

7KH )RXUWHHQWK $PHQGPHQW SURYLGHV WKDW >Q@R 6WDWH VKDOO GHSULYH DQ\ SHUVRQ RI OLIH OLEHUW\ RU SURSHUW\ ZLWKRXW GXH SURFHVV RI ODZ QRU GHQ\ WR DQ\ SHUVRQ ZLWKLQ LWV MXULVGLFWLRQ WKH HTXDO SURWHFWLRQ RI WKH ODZV (PSKDVLV DGGHGf $SSHOODQWV DUJXH DW WKH RXWVHW WKDW XQGRFXPHQWHG DOLHQV EHFDXVH RI WKHLU LPPLJUDWLRQ VWDWXV DUH QRW fSHUVRQV ZLWKLQ WKH MXULVGLFWLRQf RI WKH 6WDWH RI 7H[DV DQG WKDW WKH\ WKHUHIRUH KDYH QR ULJKW WR WKH HTXDO SURWHFWLRQ RI 7H[DV ODZ :H UHMHFW WKLV DUJXPHQW :KDWHYHU KLV VWDWXV XQGHU WKH LPPLJUDWLRQ ODZV DQ DOLHQ LV VXUHO\ D fSHUVRQf LQ DQ\ RUGLQDU\ VHQVH RI WKDW WHUP $OLHQV HYHQ DOLHQV ZKRVH SUHVHQFH LQ WKLV FRXQWU\ LV XQODZIXO KDYH ORQJ EHHQ UHFRJQL]HG DV fSHUVRQVf JXDUDQWHHG GXH SURFHVV RI ODZ E\ WKH )LIWK DQG )RXUWHHQWK $PHQGPHQWV ,QGHHG ZH KDYH FOHDUO\ KHOG WKDW WKH )LIWK $PHQGPHQW SURWHFWV DOLHQV ZKRVH SUHVHQFH LQ WKLV FRXQWU\ LV XQODZIXO IURP LQYLGLRXV GLVFULPLQDWLRQ E\ WKH )HGHUDO *RYHUQPHQW $SSHOODQWV VHHN WR GLVWLQJXLVK RXU SULRU FDVHV HPSKDVL]LQJ WKDW WKH (TXDO 3URWHFWLRQ &ODXVH GLUHFWV D 6WDWH WR DIIRUG LWV SURWHFWLRQ WR SHUVRQV ZLWKLQ LWV MXULVGLFWLRQ ZKLOH WKH 'XH 3URFHVV &ODXVHV RI WKH )LIWK DQG )RXUWHHQWK $PHQGPHQWV FRQWDLQ QR VXFK DVVHUWHGO\ OLPLWLQJ SKUDVH ,Q DSSHOODQWVf YLHZ SHUVRQV ZKR KDYH HQWHUHG WKH 8QLWHG 6WDWHV LOOHJDOO\ DUH QRW fZLWKLQ WKH MXULVGLFWLRQf RI D 6WDWH HYHQ LI WKH\ DUH SUHVHQW ZLWKLQ D 6WDWHnV ERXQGDULHV DQG VXEMHFW WR LWV ODZV 1HLWKHU RXU FDVHV QRU WKH ORJLF RI WKH )RXUWHHQWK $PHQGPHQW VXSSRUW WKDW FRQVWULFWLQJ FRQVWUXFWLRQ RI WKH SKUDVH fZLWKLQ LWV MXULVGLFWLRQf :H KDYH QHYHU VXJJHVWHG WKDW WKH FODVV RI SHUVRQV ZKR PLJKW DYDLO 6KDXJKQHVV\ Y 0H]HL 86 f :RQJ :LQJ Y 8QLWHG 6WDWHV 86 f $OWKRXJK ZH KDYH QRW SUHYLRXVO\ IRFXVHG RQ WKH LQWHQGHG PHDQLQJ RI WKLV SKUDVH ZH KDYH KDG RFFDVLRQ WR H[DPLQH WKH ILUVW VHQWHQFH RI WKH )RXUWHHQWK $PHQGPHQW ZKLFK SURYLGHV WKDW f>D@OO SHUVRQV ERP RU

PAGE 163

WKHPVHOYHV RI WKH HTXDO SURWHFWLRQ JXDUDQWHH LV OHVV WKDQ FRH[WHQVLYH ZLWK WKDW HQWLWOHG WR GXH SURFHVV 7R WKH FRQWUDU\ ZH KDYH UHFRJQL]HG > 86 @ WKDW ERWK SURYLVLRQV ZHUH IDVKLRQHG WR SURWHFW DQ LGHQWLFDO FODVV RI SHUVRQV DQG WR UHDFK HYHU\ H[HUFLVH RI VWDWH DXWKRULW\ 7KH )RXUWHHQWK $PHQGPHQW WR WKH &RQVWLWXWLRQ LV QRW FRQILQHG WR WKH SURWHFWLRQ RI FLWL]HQV ,W VD\V f1RU VKDOO DQ\ VWDWH GHSULYH DQ\ SHUVRQ RI OLIH OLEHUW\ RU SURSHUW\ ZLWKRXW GXH SURFHVV RI ODZ QRU GHQ\ WR DQ\ SHUVRQ ZLWKLQ LWV MXULVGLFWLRQ WKH HTXDO SURWHFWLRQ RI WKH ODZV 7KHVH SURYLVLRQV DUH XQLYHUVDO LQ WKHLU DSSOLFDWLRQ WR DOO SHUVRQV ZLWKLQ WKH WHUULWRULDO MXULVGLFWLRQ ZLWKRXW UHJDUG WR DQ\ GLIIHUHQFHV RI UDFH RI FRORU RU RI QDWLRQDOLW\ DQG WKH SURWHFWLRQ RI WKH ODZV LV D SOHGJH RI WKH SURWHFWLRQ RI HTXDO ODZVf ,Q FRQFOXGLQJ WKDW fDOO SHUVRQV ZLWKLQ WKH WHUULWRU\ RI WKH 8QLWHG 6WDWHVf LQFOXGLQJ DOLHQV XQODZIXOO\ SUHVHQW PD\ LQYRNH WKH )LIWK DQG 6L[WK $PHQGPHQWV WR FKDOOHQJH DFWLRQV RI WKH )HGHUDO *RYHUQPHQW ZH UHDVRQHG IURP WKH XQGHUVWDQGLQJ WKDW WKH )RXUWHHQWK $PHQGPHQW ZDV GHVLJQHG WR DIIRUG LWV SURWHFWLRQ WR DOO ZLWKLQ WKH ERXQGDULHV QDWXUDOL]HG LQ WKH 8QLWHG 6WDWHV DQG VXEMHFW WR WKH MXULVGLFWLRQ WKHUHRI DUH FLWL]HQV RI WKH 8QLWHG 6WDWHV f (PSKDVLV DGGHGf -XVWLFH *UD\ ZULWLQJ IRU WKH &RXUW LQ 8QLWHG 6WDWHV Y :RQJ .LP $UN 86 f GHWDLOHG DW VRPH OHQJWK WKH KLVWRU\ RI WKH &LWL]HQVKLS &ODXVH DQG WKH SUHGRPLQDQWO\ JHRJUDSKLF VHQVH LQ ZKLFK WKH WHUP fMXULVGLFWLRQf ZDV XVHG +H IXUWKHU QRWHG WKDW LW ZDV LPSRVVLEOH WR FRQVWUXH WKH ZRUGV fVXEMHFW WR WKH MXULVGLFWLRQ WKHUHRIf LQ WKH RSHQLQJ VHQWHQFH >RI WKH )RXUWHHQWK $PHQGPHQW@ DV OHVV FRPSUHKHQVLYH WKDQ WKH ZRUGV fZLWKLQ LWV MXULVGLFWLRQf LQ WKH FRQFOXGLQJ VHQWHQFH RI WKH VDPH VHFWLRQ RU WR KROG WKDW SHUVRQV fZLWKLQ WKH MXULVGLFWLRQf RI RQH RI WKH 6WDWHV RI WKH 8QLRQ DUH QRW fVXEMHFW WR WKH MXULVGLFWLRQ RI WKH 8QLWHG 6WDWHVf ,ELG S @ >-XVWLFH *UD\ FRQFOXGHG WKDW >H@YHU\ FLWL]HQ RU VXEMHFW RI DQRWKHU FRXQWU\ ZKLOH GRPLFLOHG KHUH LV ZLWKLQ WKH DOOHJLDQFH DQG WKH SURWHFWLRQ DQG FRQVHTXHQWO\ VXEMHFW WR WKH MXULVGLFWLRQ RI WKH 8QLWHG 6WDWHV ,ELG S $V RQH HDUO\ FRPPHQWDWRU QRWHG JLYHQ WKH KLVWRULFDO HPSKDVLV RQ JHRJUDSKLF WHUULWRULDOLW\ ERXQGHG RQO\ LI DW DOO E\ SULQFLSOHV RI VRYHUHLJQW\ DQG DOOHJLDQFH QR SODXVLEOH GLVWLQFWLRQ ZLWK UHVSHFW WR )RXUWHHQWK $PHQGPHQW fMXULVGLFWLRQf FDQ EH GUDZQ EHWZHHQ UHVLGHQW DOLHQV ZKRVH HQWU\ LQWR WKH 8QLWHG 6WDWHV ZDV ODZIXO DQG UHVLGHQW DOLHQV ZKRVH HQWU\ ZDV XQODZIXO 6HH & %RXYH ([FOXVLRQ DQG ([SXOVLRQ RI $OLHQV LQ WKH 8QLWHG 6WDWHV SS f (G@
PAGE 164

RI D 6WDWH 2XU FDVHV DSSO\LQJ WKH (TXDO 3URWHFWLRQ &ODXVH UHIOHFW WKH VDPH WHUULWRULDO WKHPH 0DQLIHVWO\ WKH REOLJDWLRQ RI WKH 6WDWH WR JLYH WKH SURWHFWLRQ RI HTXDO ODZV FDQ EH SHUIRUPHG RQO\ ZKHUH LWV ODZV RSHUDWH WKDW LV ZLWKLQ LWV RZQ MXULVGLFWLRQ ,W LV WKHUH WKDW WKH HTXDOLW\ RI OHJDO ULJKW PXVW EH PDLQWDLQHG 7KDW REOLJDWLRQ LV LPSRVHG E\ WKH &RQVWLWXWLRQ XSRQ WKH 6WDWHV VHYHUDOO\ DV JRYHUQPHQWDO HQWLWLHV HDFK UHVSRQVLEOH IRU LWV RZQ ODZV HVWDEOLVKLQJ WKH ULJKWV DQG GXWLHV RI SHUVRQV ZLWKLQ LWV ERUGHUV 7KHUH LV VLPSO\ QR VXSSRUW IRU DSSHOODQWVf VXJJHVWLRQ WKDW fGXH SURFHVVf LV VRPHKRZ RI JUHDWHU VWDWXUH WKDQ fHTXDO SURWHFWLRQf DQG WKHUHIRUH DYDLODEOH WR D ODUJHU FODVV RI SHUVRQV 7R WKH FRQWUDU\ HDFK DVSHFW RI WKH )RXUWHHQWK $PHQGPHQW UHIOHFWV DQ HOHPHQWDU\ OLPLWDWLRQ RQ VWDWH SRZHU 7R SHUPLW D 6WDWH WR HPSOR\ WKH SKUDVH fZLWKLQ LWV MXULVGLFWLRQf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f§ LQ IDFH RI WKH JUHDW FRQVWLWXWLRQDO DPHQGPHQW ZKLFK GHFODUHV WKDW QR 6WDWH VKDOO GHQ\ WR DQ\ SHUVRQ ZLWKLQ LWV MXULVGLFWLRQ WKH HTXDO SURWHFWLRQ RI WKH ODZV :RQJ :LQJ Y 8QLWHG 6WDWHV 86 SS FRQFXUULQJ LQ SDUW DQG GLVVHQWLQJ LQ SDUWf (G@ 86 >/HQJ 0D\ 0D Y %DUEHU 86 f UHOLHG RQ E\ DSSHOODQWV LV QRW WR WKH FRQWUDU\ ,Q WKDW FDVH WKH &RXUW KHOG DV D PDWWHU RI VWDWXWRU\ FRQVWUXFWLRQ WKDW DQ DOLHQ SDUROHG LQWR WKH 8QLWHG 6WDWHV SXUVXDQW WR Gff RI WKH ,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW 86& Gff HGf ZDV QRW fZLWKLQ WKH 8QLWHG 6WDWHVf IRU WKH SXUSRVH RI DYDLOLQJ KHUVHOI RI Kf ZKLFK DXWKRUL]HG WKH ZLWKKROGLQJ RI GHSRUWDWLRQ LQ FHUWDLQ FLUFXPVWDQFH 7KH FRQFOXVLRQ UHIOHFWHG WKH ORQJVWDQGLQJ GLVWLQFWLRQ EHWZHHQ H[FOXVLRQ SURFHHGLQJV LQYROYLQJ WKH GHWHUPLQDWLRQ RI DGPLVVLELOLW\ DQG GHSRUWDWLRQ SURFHHGLQJV 7KH XQGRFXPHQWHG FKLOGUHQ ZKR DUH DSSHOOHHV KHUH XQOLNH WKH SDUROHH LQ /HQJ 0D\ 0D FRXOG DSSDUHQWO\ EH UHPRYHG IURP WKH FRXQWU\ RI SXUVXDQW WR GHSRUWDWLRQ SURFHHGLQJV 86& Dff 6HHO $& *RUGRQ t + 5RVHQILHOG ,PPLJUDWLRQ /DZ DQG 3URFHGXUH E S f (G@ 0LVVRXUL H[ UHO *DLQHV Y &DQDGD 86 f

PAGE 165

&ODXVH ZDV LQWHQGHG WR ZRUN QRWKLQJ OHVV WKDQ WKH DEROLWLRQ RI DOO FDVWHEDVHG DQG LQYLGLRXV FODVVEDVHG OHJLVODWLRQ 7KDW REMHFWLYH LV IXQGDPHQWDOO\ DW RGGV ZLWK WKH SRZHU WKH 6WDWH DVVHUWV KHUH WR FODVVLI\ SHUVRQV VXEMHFW WR LWV ODZV DV QRQHWKHOHVV H[FHSWHG IURP LWV SURWHFWLRQ > 86 @ 7KH FRQJUHVVLRQDO GHEDWH FRQFHUQLQJ $UWLFOH RI WKH )RXUWHHQWK $PHQGPHQW ZDV OLPLWHG WKDW GHEDWH FOHDUO\ FRQILUPV WKH XQGHUVWDQGLQJ WKDW WKH SKUDVH fZLWKLQ LWV MXULVGLFWLRQf ZDV LQWHQGHG LQ D EURDG VHQVH WR RIIHU WKH JXDUDQWHH RI HTXDO SURWHFWLRQ WR DOO ZLWKLQ D 6WDWHnV ERXQGDULHV DQG WR DOO XSRQ ZKRP WKH 6WDWH ZRXOG LPSRVH WKH REOLJDWLRQV RI LWV ODZV ,QGHHG LW DSSHDUV IURP WKRVH GHEDWHV WKDW &RQJUHVV E\ XVLQJ WKH SKUDVH fSHUVRQ ZLWKLQ LWV MXULVGLFWLRQf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f >5HSUHVHQWDWLYH %LQJKDPnV YLHZV DUH DOVR UHIOHFWHG LQ KLV FRPPHQWV RQ WKH &LYLO 5LJKWV %LOO RI +H UHSHDWHGO\ UHIHUUHG WR WKH QHHG WR SURYLGH SURWHFWLRQ QRW RQO\ WR WKH IUHHGPHQ EXW WR fWKH DOLHQ DQG VWUDQJHUf DQG WR fUHIXJHHV DQG DOO PHQf &RQJUHVVLRQDO *OREH WK &RQJ VW 6HVV f (G@ ,ELG S

PAGE 166

6HQDWRU +RZDUG DOVR D PHPEHU RI WKH -RLQW &RPPLWWHH RI )LIWHHQ DQG WKH IORRU PDQDJHU RI WKH $PHQGPHQW LQ WKH 6HQDWH ZDV QR OHVV H[SOLFLW DERXW WKH EURDG REMHFWLYHV RI WKH $PHQGPHQW DQG WKH LQWHQWLRQ WR PDNH LWV SURYLVLRQV DSSOLFDEOH WR DOO ZKR fPD\ KDSSHQ WR EHf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fZLWKLQ LWV MXULVGLFWLRQf WKXV GRHV QRW GHWUDFW IURP EXW UDWKHU FRQILUPV WKH XQGHUVWDQGLQJ WKDW WKH SURWHFWLRQ RI WKH )RXUWHHQWK $PHQGPHQW H[WHQGV WR DQ\RQH FLWL]HQ RU VWUDQJHU ZKR LV VXEMHFW WR WKH ODZV RI D 6WDWH DQG UHDFKHV LQWR HYHU\ FRPHU RI D 6WDWHnV WHUULWRU\ 7KDW D SHUVRQnV LQLWLDO HQWU\ LQWR D 6WDWH RU LQWR WKH 8QLWHG 6WDWHV ZDV XQODZIXO DQG WKDW KH PD\ IRU WKDW UHDVRQ EH H[SHOOHG FDQQRW QHJDWH WKH VLPSOH IDFW RI KLV SUHVHQFH ZLWKLQ WKH 6WDWHnV WHUULWRULDO SHULPHWHU *LYHQ VXFK SUHVHQFH KH LV VXEMHFW WR WKH IXOO UDQJH RI REOLJDWLRQV LPSRVHG E\ WKH 6WDWHnV FLYLO DQG FULPLQDO ODZV $QG XQWLO KH OHDYHV WKH MXULVGLFWLRQ HLWKHU YROXQWDULO\ RU LQYROXQWDULO\ LQ ,ELG S HPSKDVLV DGGHGf

PAGE 167

DFFRUGDQFH ZLWK WKH &RQVWLWXWLRQ DQG ODZV RI WKH 8QLWHG 6WDWHV f§ KH LV HQWLWOHG WR WKH HTXDO SURWHFWLRQ RI WKH ODZV WKDW D 6WDWH PD\ FKRRVH WR HVWDEOLVK 2XU FRQFOXVLRQ WKDW WKH LOOHJDO DOLHQV ZKR DUH SODLQWLIIV LQ WKHVH FDVHV PD\ FODLP WKH EHQHILW RI WKH )RXUWHHQWK $PHQGPHQWnV JXDUDQWHH RI HTXDO SURWHFWLRQ RQO\ EHJLQV WKH LQTXLU\ 7KH PRUH GLIILFXOW TXHVWLRQ LV ZKHWKHU WKH (TXDO 3URWHFWLRQ &ODXVH KDV EHHQ YLRODWHG E\ WKH UHIXVDO RI WKH 6WDWH RI 7H[DV WR UHLPEXUVH ORFDO VFKRRO ERDUGV IRU WKH HGXFDWLRQ RI FKLOGUHQ ZKR FDQQRW GHPRQVWUDWH WKDW WKHLU SUHVHQFH ZLWKLQ WKH 8QLWHG 6WDWHV LV ODZIXO RU E\ WKH LPSRVLWLRQ E\ WKRVH VFKRRO ERDUGV RI WKH EXUGHQ RI WXLWLRQ RQ WKRVH FKLOGUHQ ,W LV WR WKLV TXHVWLRQ WKDW ZH QRZ WXUQ ,OO 7KH (TXDO 3URWHFWLRQ &ODXVH GLUHFWV WKDW fDOO SHUVRQV VLPLODUO\ FLUFXPVWDQFHG VKDOO EH WUHDWHG DOLNHf %XW VR WRR f>W@KH &RQVWLWXWLRQ GRHV QRW UHTXLUH WKLQJV ZKLFK DUH GLIIHUHQW LQ IDFW RU RSLQLRQ WR EH WUHDWHG LQ ODZ DV WKRXJK WKH\ ZHUH WKH VDPHf 7KH LQLWLDO GLVFUHWLRQ WR GHWHUPLQH ZKDW LV fGLIIHUHQWf DQG ZKDW LV fWKH VDPHf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f 7LJQHU Y 7H[DV 86 f

PAGE 168

%XW ZH ZRXOG QRW EH IDLWKIXO WR RXU REOLJDWLRQV XQGHU WKH )RXUWHHQWK $PHQGPHQW LI ZH DSSOLHG VR GHIHUHQWLDO D VWDQGDUG WR HYHU\ FODVVLILFDWLRQ 7KH (TXDO 3URWHFWLRQ &ODXVH ZDV LQWHQGHG DV D UHVWULFWLRQ RQ VWDWH OHJLVODWLYH DFWLRQ LQFRQVLVWHQW ZLWK HOHPHQWDO FRQVWLWXWLRQDO SUHPLVHV 7KXV ZH KDYH WUHDWHG DV SUHVXPSWLYHO\ LQYLGLRXV WKRVH FODVVLILFDWLRQV WKDW GLVDGYDQWDJH D fVXVSHFW FODVVf RU WKDW LPSLQJH XSRQ WKH H[HUFLVH RI D fIXQGDPHQWDO ULJKWf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fVXVSHFWf 6RPH FODVVLILFDWLRQV DUH PRUH OLNHO\ WKDQ RWKHUV WR UHIOHFW GHHSVHDWHG SUHMXGLFH UDWKHU WKDQ OHJLVODWLYH UDWLRQDOLW\ LQ SXUVXLW RI VRPH OHJLWLPDWH REMHFWLYH /HJLVODWLRQ SUHGLFDWHG RQ VXFK SUHMXGLFH LV HDVLO\ UHFRJQL]HG DV LQFRPSDWLEOH ZLWK WKH FRQVWLWXWLRQDO XQGHUVWDQGLQJ WKDW HDFK SHUVRQ LV WR EH MXGJHG LQGLYLGXDOO\ DQG LV HQWLWOHG WR HTXDO MXVWLFH XQGHU WKH ODZ &ODVVLILFDWLRQV WUHDWHG DV VXVSHFW WHQG WR EH LUUHOHYDQW WR DQ\ SURSHU OHJLVODWLYH JRDO 6HH 0F/DXJKOLQ Y )ORULGD 86 f +LUDED\DVKL Y 8QLWHG 6WDWHV 86 f )LQDOO\ FHUWDLQ JURXSV LQGHHG ODUJHO\ WKH VDPH JURXSV KDYH KLVWRULFDOO\ EHHQ fUHOHJDWHG WR VXFK D SRVLWLRQ RI SROLWLFDO SRZHUOHVVQHVV DV WR FRPPDQG H[WUDRUGLQDU\ SURWHFWLRQ IURP WKH PDMRULWDULDQ SROLWLFDO SURFHVVf 6DQ $QWRQLR ,QGHSHQGHQW 6FKRRO 'LVWULFW Y 5RGULJXH] 86 f *UDKDP Y 5LFKDUGVRQ 86 f VHH 8QLWHG 6WDWHV Y &DURWHQH 3URGXFWV &R 86 Q f 7KH H[SHULHQFH RI RXU 1DWLRQ KDV VKRZQ WKDW SUHMXGLFH PD\ PDQLIHVW LWVHOI LQ WKH WUHDWPHQW RI VRPH JURXSV 2XU UHVSRQVH WR WKDW H[SHULHQFH LV UHIOHFWHG LQ WKH (TXDO 3URWHFWLRQ &ODXVH RI WKH )RXUWHHQWK $PHQGPHQW /HJLVODWLRQ LPSRVLQJ VSHFLDO GLVDELOLWLHV XSRQ JURXSV GLVIDYRUHG E\ YLUWXH RI FLUFXPVWDQFHV EH\RQG WKHLU FRQWURO VXJJHVWV WKH NLQG RI fFODVV RU FDVWHf WUHDWPHQW WKDW WKH )RXUWHHQWK $PHQGPHQW ZDV GHVLJQHG WR DEROLVK (G@ >,Q GHWHUPLQLQJ ZKHWKHU D FODVVEDVHG GHQLDO RI D SDUWLFXODU ULJKW LV GHVHUYLQJ RI VWULFW VFUXWLQ\ XQGHU WKH (TXDO 3URWHFWLRQ &ODXVH ZH ORRN WR WKH &RQVWLWXWLRQ WR VHH LI WKH ULJKW LQIULQJHG KDV LWV VRXUFH H[SOLFLWO\ RU LPSOLFLWO\ WKHUHLQ %XW ZH KDYH DOVR UHFRJQL]HG WKH IXQGDPHQWDOLW\ RI SDUWLFLSDWLRQ LQ VWDWH fHOHFWLRQV RQ DQ HTXDO EDVLV ZLWK RWKHU FLWL]HQV LQ WKH MXULVGLFWLRQ f 'XQQ Y %OXPVWHLQ 86 f HYHQ WKRXJK fWKH ULJKW WR YRWH SHU VH LV QRW D FRQVWLWXWLRQDOO\ SURWHFWHG ULJKWf 6DQ $QWRQLR ,QGHSHQGHQW 6FKRRO 'LVWULFW SS Q :LWK UHVSHFW WR VXIIUDJH ZH KDYH H[SODLQHG WKH QHHG IRU VWULFW VFUXWLQ\ DV DULVLQJ IURP WKH VLJQLILFDQFH RI WKH IUDQFKLVH DV WKH JXDUGLDQ RI DOO RWKHU ULJKWV 6HH +DUSHU Y 9LUJLQLD %G RI (OHFWLRQV 86 f 5H\QROGV Y 6LPV 86 f
PAGE 169

PD\ IDLUO\ EH YLHZHG DV IXUWKHULQJ > 86 @ D VXEVWDQWLDO LQWHUHVW RI WKH 6WDWH :H WXUQ WR D FRQVLGHUDWLRQ RI WKH VWDQGDUG DSSURSULDWH IRU WKH HYDOXDWLRQ RI $ 6KHHU LQFDSDELOLW\ RU OD[ HQIRUFHPHQW RI WKH ODZV EDUULQJ HQWU\ LQWR WKLV FRXQWU\ FRXSOHG ZLWK WKH IDLOXUH WR HVWDEOLVK DQ HIIHFWLYH EDU WR WKH HPSOR\PHQW RI XQGRFXPHQWHG DOLHQV KDV UHVXOWHG LQ WKH FUHDWLRQ RI D VXEVWDQWLDO fVKDGRZ SRSXODWLRQf RI LOOHJDO PLJUDQWV f§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f§ LQFOXGLQJ RQH WR fOHJDOL]Hf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f WHVWLPRQ\ RI :LOOLDP )UHQFK 6PLWK $WWRUQH\ *HQHUDOf (G@ >$V WKH 'LVWULFW &RXUW REVHUYHG LQ 1R WKH FRQIOXHQFH RI *RYHUQPHQW SROLFLHV KDV UHVXOWHG LQ WKH H[LVWHQFH RI D ODUJH QXPEHU RI HPSOR\HG LOOHJDO DOLHQV VXFK DV WKH SDUHQWV RI SODLQWLIIV LQ WKLV FDVH ZKRVH SUHVHQFH LV WROHUDWHG ZKRVH HPSOR\PHQW LV SHUKDSV HYHQ ZHOFRPHG EXW ZKR DUH YLUWXDOO\ GHIHQVHOHVV DJDLQVW DQ\ DEXVH H[SORLWDWLRQ RU FDOORXV QHJOHFW WR ZKLFK WKH VWDWH RU WKH VWDWHnV QDWXUDO FLWL]HQV DQG EXVLQHVV RUJDQL]DWLRQV PD\ ZLVK WR VXEMHFW WKHP )6XSS SS (G@ >:H UHMHFW WKH FODLP WKDW fLOOHJDO DOLHQVf DUH D fVXVSHFW FODVVf 1R FDVH LQ ZKLFK ZH KDYH DWWHPSWHG WR GHILQH D VXVSHFW FODVV VHH HJ Q KDV DGGUHVVHG WKH VWDWXV RI SHUVRQV XQODZIXOO\ LQ RXU FRXQWU\ 8QOLNH PRVW RI WKH FODVVLILFDWLRQV WKDW ZH KDYH UHFRJQL]HG DV VXVSHFW HQWU\ LQWR WKLV FODVV E\ YLUWXH RI HQWU\ LQWR WKLV FRXQWU\ LV WKH SURGXFW RI YROXQWDU\ DFWLRQ ,QGHHG HQWU\ LQWR WKH FODVV LV LWVHOI D FULPH ,Q DGGLWLRQ LW FRXOG KDUGO\ EH VXJJHVWHG WKDW XQGRFXPHQWHG VWDWXV LV D fFRQVWLWXWLRQDO LUUHOHYDQF\f :LWK UHVSHFW WR WKH DFWLRQV RI WKH )HGHUDO *RYHUQPHQW DOLHQDJH FODVVLILFDWLRQV PD\ EH LQWLPDWHO\ UHODWHG WR WKH FRQGXFW RI IRUHLJQ SROLF\ WR WKH IHGHUDO SUHURJDWLYH WR FRQWURO DFFHVV WR WKH 8QLWHG 6WDWHV DQG WR WKH SOHQDU\ IHGHUDO SRZHU WR GHWHUPLQH ZKR KDV VXIILFLHQWO\ PDQLIHVWHG KLV DOOHJLDQFH WR EHFRPH D FLWL]HQ RI WKH 1DWLRQ 1R

PAGE 170

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fSDUHQWV KDYH WKH DELOLW\ WR FRQIRUP WKHLU FRQGXFW WR VRFLHWDO QRUPVf DQG SUHVXPDEO\ WKH DELOLW\ WR UHPRYH WKHPVHOYHV IURP WKH 6WDWHnV MXULVGLFWLRQ EXW WKH FKLOGUHQ ZKR DUH SODLQWLIIV LQ WKHVH FDVHV fFDQ DIIHFW QHLWKHU WKHLU SDUHQWVf FRQGXFW QRU WKHLU RZQ VWDWXVf f (YHQ LI WKH 6WDWH IRXQG LW H[SHGLHQW WR FRQWURO WKH FRQGXFW RI DGXOWV E\ DFWLQJ DJDLQVW WKHLU FKLOGUHQ OHJLVODWLRQ GLUHFWLQJ WKH RQXV RI D SDUHQWfV PLVFRQGXFW DJDLQVW KLV FKLOGUHQ GRHV QRW FRPSRUW ZLWK IXQGDPHQWDO FRQFHSWLRQV RI MXVWLFH >9MLVLWLQJ FRQGHPQDWLRQ RQ WKH KHDG RI DQ LQIDQW LV LOORJLFDO DQG XQMXVW 0RUHRYHU LPSRVLQJ GLVDELOLWLHV RQ WKH FKLOG LV FRQWUDU\ WR WKH EDVLF FRQFHSW RI RXU V\VWHP WKDW OHJDO EXUGHQV VKRXOG EHDU VRPH UHODWLRQVKLS WR LQGLYLGXDO UHVSRQVLELOLW\ RU ZURQJGRLQJ 2EYLRXVO\ QR FKLOG LV UHVSRQVLEOH IRU KLV ELUWK DQG SHQDOL]LQJ WKH FKLOG LV DQ LQHIIHFWXDOf§DV ZHOO DV XQMXVW ZD\ RI GHWHUULQJ WKH SDUHQW 6WDWH PD\ LQGHSHQGHQWO\ H[HUFLVH D OLNH SRZHU %XW LI WKH )HGHUDO *RYHUQPHQW KDV E\ XQLIRUP UXOH SUHVFULEHG ZKDW LW EHOLHYHV WR EH DSSURSULDWH VWDQGDUGV IRU WKH WUHDWPHQW RI DQ DOLHQ VXEFODVV WKH 6WDWHV PD\ RI FRXUVH IROORZ WKH IHGHUDO GLUHFWLRQ 6HH 'H &DQDV Y %LFD 86 f (G@ 3O\OHU 86 7ULPEOH Y *RUGRQ 86 f :HEHU Y $HWQD &DVXDOW\ t 6XUHW\ &R 86 f

PAGE 171

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fULJKWf JUDQWHG WR LQGLYLGXDOV E\ WKH &RQVWLWXWLRQ %XW QHLWKHU LV LW PHUHO\ VRPH JRYHUQPHQWDO fEHQHILWf LQGLVWLQJXLVKDEOH IURP RWKHU IRUPV RI VRFLDO ZHOIDUH OHJLVODWLRQ %RWK WKH LPSRUWDQFH RI HGXFDWLRQ LQ PDLQWDLQLQJ RXU EDVLF LQVWLWXWLRQV DQG WKH ODVWLQJ LPSDFW RI LWV GHSULYDWLRQ RQ WKH OLIH RI WKH FKLOG PDUN WKH GLVWLQFWLRQ 7KH f$PHULFDQ SHRSOH KDYH DOZD\V UHJDUGHG HGXFDWLRQ DQG >WKH@ DFTXLVLWLRQ RI NQRZOHGJH DV PDWWHUV RI VXSUHPH LPSRUWDQFHf :H KDYH UHFRJQL]HG fWKH SXEOLF VFKRROV DV D PRVW YLWDO FLYLF LQVWLWXWLRQ IRU WKH SUHVHUYDWLRQ RI D GHPRFUDWLF V\VWHP RI JRYHUQPHQWf DQG DV WKH SULPDU\ YHKLFOH IRU WUDQVPLWWLQJ fWKH YDOXHV RQ ZKLFK RXU VRFLHW\ UHVWVf >$@V SRLQWHG RXW HDUO\ LQ RXU KLVWRU\ VRPH GHJUHH RI HGXFDWLRQ LV QHFHVVDU\ WR SUHSDUH FLWL]HQV WR SDUWLFLSDWH HIIHFWLYHO\ DQG LQWHOOLJHQWO\ LQ RXU RSHQ SROLWLFDO V\VWHP LI ZH DUH WR SUHVHUYH IUHHGRP DQG LQGHSHQGHQFH $QG WKHVH KLVWRULF 6DQ $QWRQLR ,QGHSHQGHQW 6FKRRO 'LVWULFW Y 5RGULJXH] 86 f 0H\HU Y 1HEUDVND 86 f $ELQJWRQ 6FKRRO 'LVWULFW Y 6FKHPSS 86 f %5(11$1 FRQFXUULQJf $PEDFK Y 1RUZLFN 86 f :LVFRQVLQ Y
PAGE 172

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fHGXFDWLRQ SUHSDUHV LQGLYLGXDOV WR EH VHOIUHOLDQW DQG VHOIVXIILFLHQW SDUWLFLSDQWV LQ VRFLHW\f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
PAGE 173

HPERGLHG LQ WKH (TXDO 3URWHFWLRQ &ODXVH :KDW ZH VDLG \HDUV DJR LQ %URZQ Y %RDUG RI (GXFDWLRQn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fFRQVWLWXWLRQDO LUUHOHYDQF\f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f>7@KH EHQHILWV RI HGXFDWLRQ DUH QRW UHVHUYHG WR WKRVH ZKRVH SURGXFWLYH XWLOL]DWLRQ RI WKHP LV D FHUWDLQW\f )6XSS S Q ,Q DGGLWLRQ DOWKRXJK D QRQFLWL]HQ PD\ EH EDUUHG IURP IXOO LQYROYHPHQW LQ WKH SROLWLFDO DUHQD KH PD\ SOD\ D UROH f§ SHUKDSV HYHQ D OHDGHUVKLS UROH f§ LQ RWKHU DUHDV RI LPSRUW WR WKH FRPPXQLW\ 1\TXLVW Y 0DXFOHW 86 f 0RUHRYHU WKH VLJQLILFDQFH RI HGXFDWLRQ WR RXU VRFLHW\ LV QRW OLPLWHG WR LWV SROLWLFDO DQG FXOWXUDO IUXLWV 7KH SXEOLF VFKRROV DUH DQ LPSRUWDQW VRFLDOL]LQJ LQVWLWXWLRQ LPSDUWLQJ WKRVH VKDUHG YDOXHV WKURXJK ZKLFK VRFLDO RUGHU DQG VWDELOLW\ DUH PDLQWDLQHG 86 f (G@ 86

PAGE 174

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nV SULQFLSDO DUJXPHQW DQG DSSDUHQWO\ WKH YLHZ RI WKH GLVVHQWLQJ -XVWLFHV WKDW WKH XQGRFXPHQWHG VWDWXV RI WKHVH FKLOGUHQ YHO QRQ HVWDEOLVKHV D VXIILFLHQW UDWLRQDO EDVLV IRU GHQ\LQJ WKHP EHQHILWV WKDW D 6WDWH PLJKW FKRRVH WR DIIRUG RWKHU UHVLGHQWV 7KH 6WDWH QRWHV WKDW ZKLOH RWKHU DOLHQV DUH DGPLWWHG fRQ DQ HTXDOLW\ RI OHJDO SULYLOHJHV ZLWK DOO FLWL]HQV XQGHU QRQGLVFULPLQDWRU\ ODZVf WKH DVVHUWHG ULJKW RI WKHVH FKLOGUHQ WR DQ HGXFDWLRQ FDQ FODLP QR LPSOLFLW FRQJUHVVLRQDO LPSULPDWXU ,QGHHG LQ WKH 6WDWHnV YLHZ &RQJUHVVn DSSDUHQW GLVDSSURYDO RI WKH SUHVHQFH RI WKHVH FKLOGUHQ ZLWKLQ WKH 6DQ $QWRQLR ,QGHSHQGHQW 6FKRRO 'LVWULFW Y 5RGULJXH] SS 7DNDKDVKL Y )LVK t *DPH &RPPLVVLRQ 86 f >,I WKH FRQVWLWXWLRQDO JXDUDQWHH RI HTXDO SURWHFWLRQ ZDV DYDLODEOH RQO\ WR WKRVH XSRQ ZKRP &RQJUHVV DIILUPDWLYHO\ JUDQWHG LWV EHQHILW WKH VWDWHfV DUJXPHQW ZRXOG EH YLUWXDOO\ XQDQVZHUDEOH %XW WKH (TXDO 3URWHFWLRQ &ODXVH RSHUDWHV RI LWV RZQ IRUFH WR SURWHFW DQ\RQH fZLWKLQ >WKH 6WDWHnV@ MXULVGLFWLRQf IURP WKH 6WDWHnV DUELWUDU\ DFWLRQ 6HH 3DUW ,, 7KH TXHVWLRQ ZH H[DPLQH LQ WH[W LV ZKHWKHU WKH IHGHUDO GLVDSSURYDO RI WKH SUHVHQFH RI WKHVH FKLOGUHQ DVVLVWV WKH 6WDWH LQ RYHUFRPLQJ WKH SUHVXPSWLRQ WKDW GHQLDO RI HGXFDWLRQ WR LQQRFHQW FKLOGUHQ LV QRW D UDWLRQDO UHVSRQVH WR OHJLWLPDWH VWDWH FRQFHUQV (G@

PAGE 175

8QLWHG 6WDWHV DQG WKH HYDVLRQ RI WKH IHGHUDO UHJXODWRU\ SURJUDP WKDW LV WKH PDUN RI XQGRFXPHQWHG VWDWXV SURYLGHV DXWKRULW\ IRU LWV GHFLVLRQ WR LPSRVH XSRQ WKHP VSHFLDO GLVDELOLWLHV )DFHG ZLWK DQ HTXDO SURWHFWLRQ FKDOOHQJH UHVSHFWLQJ WKH WUHDWPHQW RI DOLHQV ZH DJUHH WKDW WKH FRXUWV PXVW EH DWWHQWLYH WR FRQJUHVVLRQDO SROLF\ WKH H[HUFLVH RI FRQJUHVVLRQDO SRZHU PLJKW ZHOO DIIHFW WKH 6WDWHnV SUHURJDWLYHV WR DIIRUG GLIIHUHQWLDO WUHDWPHQW WR D SDUWLFXODU FODVV RI DOLHQV %XW ZH DUH XQDEOH WR ILQG LQ WKH FRQJUHVVLRQDO LPPLJUDWLRQ VFKHPH DQ\ VWDWHPHQW RI SROLF\ WKDW PLJKW ZHLJK VLJQLILFDQWO\ LQ DUULYLQJ DW DQ HTXDO SURWHFWLRQ EDODQFH FRQFHUQLQJ WKH 6WDWHnV DXWKRULW\ WR GHSULYH WKHVH FKLOGUHQ RI DQ HGXFDWLRQ 7KH &RQVWLWXWLRQ JUDQWV &RQJUHVV WKH SRZHU WR fHVWDEOLVK DQ XQLIRUP 5XOH RI 1DWXUDOL]DWLRQf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fFRPPLWWHG WR WKH SROLWLFDO EUDQFKHV RI WKH )HGHUDO JRYHUQPHQWf 86 $UW FO 0DWKHZV Y 'LD] 86 f +DULVLDGHV Y 6KDXJKQHVV\ 86 f 0DWKHZV S +LQHV Y 'DYLGRZLW] 86 f 0DWKHZV 86 S

PAGE 176

$OWKRXJK LW LV fD URXWLQH DQG QRUPDOO\ OHJLWLPDWH SDUWf RI WKH EXVLQHVV RI WKH )HGHUDO *RYHUQPHQW WR FODVVLI\ RQ WKH EDVLV RI DOLHQ VWDWXV DQG WR fWDNH LQWR DFFRXQW WKH FKDUDFWHU RI WKH UHODWLRQVKLS EHWZHHQ WKH DOLHQ DQG WKLV FRXQWU\f RQO\ UDUHO\ DUH VXFK PDWWHUV UHOHYDQW WR OHJLVODWLRQ E\ D 6WDWH $V ZH UHFRJQL]HG LQ 'H &DQDV Y %LFD WKH 6WDWHV GR KDYH VRPH DXWKRULW\ WR DFW ZLWK UHVSHFW WR LOOHJDO DOLHQV DW OHDVW ZKHUH VXFK DFWLRQ PLUURUV IHGHUDO REMHFWLYHV DQG IXUWKHUV D OHJLWLPDWH VWDWH JRDO ,Q 'H &DQDV WKH 6WDWHnV SURJUDP UHIOHFWHG &RQJUHVVf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f 86 f ,ELG S S 86& HG DQG 6XSS ,9f

PAGE 177

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fWKH SXUSRVHV IRU ZKLFK WKH VWDWH GHVLUHV WR XVH LWf :H WKHUHIRUH WXUQ WR WKH VWDWH REMHFWLYHV WKDW DUH VDLG WR VXSSRUW 9 $SSHOODQWV DUJXH WKDW WKH FODVVLILFDWLRQ DW LVVXH IXUWKHUV DQ LQWHUHVW LQ WKH fSUHVHUYDWLRQ RI WKH VWDWHfV OLPLWHG UHVRXUFHV IRU WKH HGXFDWLRQ RI LWV ODZIXO UHVLGHQWVf 86& Kf HG DQG 6XSS ,9f 2\DPD Y &DOLIRUQLD 86 f 0XUSK\ FRQFXUULQJf HPSKDVLV DGGHGf 86 >$SSHOODQW 6FKRRO 'LVWULFW VRXJKW DW RUDO DUJXPHQW WR FKDUDFWHUL]H WKH DOLHQDJH FODVVLILFDWLRQ FRQWDLQHG LQ DV VLPSO\ D WHVW RI UHVLGHQFH :H DUH XQDEOH WR XSKROG RQ WKDW EDVLV $SSHOODQWV FRQFHGHG WKDW LI IRU H[DPSOH D 9LUJLQLDQ RU D OHJDOO\ DGPLWWHG 0H[LFDQ FLWL]HQ HQWHUHG 7\OHU ZLWK KLV VFKRRODJH FKLOGUHQ LQWHQGLQJ WR UHPDLQ RQO\ VL[ PRQWKV WKRVH FKLOGUHQ ZRXOG EH YLHZHG DV UHVLGHQWV HQWLWOHG WR DWWHQG 7\OHU VFKRROV 7U RI 2UDO $UJ ,W LV WKXV FOHDU WKDW 7\OHUnV UHVLGHQFH DUJXPHQW DPRXQWV WR

PAGE 178

2I FRXUVH D FRQFHUQ IRU WKH SUHVHUYDWLRQ RI UHVRXUFHV VWDQGLQJ DORQH FDQ KDUGO\ MXVWLI\ WKH FODVVLILFDWLRQ XVHG LQ DOORFDWLQJ WKRVH UHVRXUFHV 7KH 6WDWH PXVW GR PRUH WKDQ MXVWLI\ LWV FODVVLILFDWLRQ ZLWK D FRQFLVH H[SUHVVLRQ RI DQ LQWHQWLRQ WR GLVFULPLQDWH $SDUW IURP WKH DVVHUWHG VWDWH SUHURJDWLYH WR DFW DJDLQVW XQGRFXPHQWHG FKLOGUHQ VROHO\ RQ WKH EDVLV RI WKHLU XQGRFXPHQWHG VWDWXV f§ DQ DVVHUWHG SUHURJDWLYH WKDW FDUULHV RQO\ PLQLPDO IRUFH LQ WKH FLUFXPVWDQFHV RI WKHVH FDVHV f§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n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f $SSHOODQWV KDYH QRW VKRZQ WKDW WKH IDPLOLHV RI XQGRFXPHQWHG FKLOGUHQ GR QRW FRPSO\ ZLWK WKH HVWDEOLVKHG VWDQGDUGV E\ ZKLFK WKH 6WDWH KLVWRULFDOO\ WHVWV UHVLGHQFH $SDUW IURP WKH DOLHQDJH OLPLWDWLRQ Ef UHTXLUHV D VFKRRO GLVWULFW WR SURYLGH HGXFDWLRQ RQO\ WR UHVLGHQW FKLOGUHQ 7KH VFKRRO GLVWULFWV RI WKH 6WDWH DUH DV IUHH WR DSSO\ WR XQGRFXPHQWHG FKLOGUHQ HVWDEOLVKHG FULWHULD IRU GHWHUPLQLQJ UHVLGHQFH DV WKH\ DUH WR DSSO\ WKRVH FULWHULD WR DQ\ RWKHU FKLOG ZKR VHHNV DGPLVVLRQ (G@ *UDKDP Y 5LFKDUGVRQ 86 f %RDUG Y )ORUHV GH 2WHUR 86 f >$OWKRXJK WKH 6WDWH KDV QR GLUHFW LQWHUHVW LQ FRQWUROOLQJ HQWU\ LQWR WKLV FRXQWU\ WKDW LQWHUHVW EHLQJ RQH UHVHUYHG E\ WKH &RQVWLWXWLRQ WR WKH )HGHUDO *RYHUQPHQW XQFKHFNHG XQODZIXO PLJUDWLRQ PLJKW LPSDLU WKH 6WDWHnV HFRQRP\ JHQHUDOO\ RU WKH 6WDWHfV DELOLW\ WR SURYLGH VRPH LPSRUWDQW VHUYLFH 'HVSLWH WKH H[FOXVLYH IHGHUDO FRQWURO RI WKLV 1DWLRQnV ERUGHUV ZH FDQQRW FRQFOXGH WKDW WKH 6WDWHV DUH ZLWKRXW DQ\ SRZHU WR GHWHU WKH LQIOX[ RI SHUVRQV HQWHULQJ WKH 8QLWHG 6WDWHV DJDLQVW IHGHUDO ODZ DQG ZKRVH QXPEHUV PLJKW KDYH D GLVFHUQLEOH LPSDFW RQ WUDGLWLRQDO VWDWH FRQFHUQV (G@ 6HH 'H &DQDV Y %LFD 86 S

PAGE 179

DQG WD[ PRQH\ WR WKH VWDWH ILVF 7KH GRPLQDQW LQFHQWLYH IRU LOOHJDO HQWU\ LQWR WKH 6WDWH RI 7H[DV LV WKH DYDLODELOLW\ RI HPSOR\PHQW IHZ LI DQ\ LOOHJDO LPPLJUDQWV FRPH WR WKLV FRXQWU\ RU SUHVXPDEO\ WR WKH 6WDWH RI 7H[DV LQ RUGHU WR DYDLO WKHPVHOYHV RI D IUHH HGXFDWLRQ 7KXV HYHQ PDNLQJ WKH GRXEWIXO DVVXPSWLRQ WKDW WKH QHW LPSDFW RI LOOHJDO DOLHQV RQ WKH HFRQRP\ RI WKH 6WDWH LV QHJDWLYH ZH WKLQN LW FOHDU WKDW fFKDUJLQJ WXLWLRQ WR XQGRFXPHQWHG FKLOGUHQ FRQVWLWXWHV D OXGLFURXVO\ LQHIIHFWXDO DWWHPSW WR VWHP WKH WLGH RI LOOHJDO LPPLJUDWLRQf DW OHDVW ZKHQ FRPSDUHG ZLWK WKH DOWHUQDWLYH RI > 86 @ QR SURKLELWLQJ WKH HPSOR\PHQW RI LOOHJDO DOLHQV 6HFRQG ZKLOH LW LV DSSDUHQW WKDW D 6WDWH PD\ fQRW UHGXFH H[SHQGLWXUHV IRU HGXFDWLRQ E\ EDUULQJ >VRPH DUELWUDULO\ FKRVHQ FODVV RI@ FKLOGUHQ IURP LWV VFKRROVf DSSHOODQWV VXJJHVW WKDW XQGRFXPHQWHG FKLOGUHQ DUH DSSURSULDWHO\ VLQJOHG RXW IRU H[FOXVLRQ EHFDXVH RI WKH VSHFLDO EXUGHQV WKH\ LPSRVH RQ WKH 6WDWHn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f7KH HYLGHQFH GHPRQVWUDWHV WKDW XQGRFXPHQWHG SHUVRQV GR QRW LPPLJUDWH LQ VHDUFK IRU D IUHH SXEOLF HGXFDWLRQ 9LUWXDOO\ DOO RI WKH XQGRFXPHQWHG SHUVRQV ZKR FRPH LQWR WKLV FRXQWU\ VHHN HPSOR\PHQW RSSRUWXQLWLHV DQG QRW HGXFDWLRQDO EHQHILWV 7KHUH ZDV RYHUZKHOPLQJ HYLGHQFH RI WKH XQLPSRUWDQFH RI SXEOLF HGXFDWLRQ DV D VWLPXOXV IRU LPPLJUDWLRQff (G@ )6XSS S 6HH )G S )6XSS S DQG Q 6KDSLUR Y 7KRPSVRQ 86 f ,ELG SS >1RU GRHV WKH UHFRUG VXSSRUW WKH FODLP WKDW WKH HGXFDWLRQDO UHVRXUFHV RI WKH 6WDWH DUH VR GLUHO\ OLPLWHG WKDW VRPH IRUP RI fHGXFDWLRQDO WULDJHf PLJKW EH GHHPHG D UHDVRQDEOH DVVXPLQJ WKDW LW ZHUH D SHUPLVVLEOHf UHVSRQVH WR WKH 6WDWHnV SUREOHPV (G@

PAGE 180

FKLOG >ZKLFK PLJKW UHVXOW IURP GHYRWLQJ VRPH VWDWH IXQGV WR WKH HGXFDWLRQ RI WKH H[FOXGHG JURXS@ ZLOO KDYH D JUDYH LPSDFW RQ WKH TXDOLW\ RI HGXFDWLRQ $QG DIWHU UHYLHZLQJ WKH 6WDWHnV VFKRRO ILQDQFLQJ PHFKDQLVP WKH 'LVWULFW &RXUW LQ 1R FRQFOXGHG WKDW EDUULQJ XQGRFXPHQWHG FKLOGUHQ IURP ORFDO VFKRROV ZRXOG QRW QHFHVVDULO\ LPSURYH WKH TXDOLW\ RI HGXFDWLRQ SURYLGHG LQ WKRVH VFKRROV 2I FRXUVH HYHQ LI LPSURYHPHQW LQ WKH TXDOLW\ RI HGXFDWLRQ ZHUH D OLNHO\ UHVXOW RI EDUULQJ VRPH QXPEHU RI FKLOGUHQ IURP WKH VFKRROV RI WKH 6WDWH WKH 6WDWH PXVW VXSSRUW LWV VHOHFWLRQ RI WKLV JURXS DV WKH DSSURSULDWH WDUJHW IRU H[FOXVLRQ ,Q WHUPV RI HGXFDWLRQDO FRVW DQG QHHG KRZHYHU XQGRFXPHQWHG FKLOGUHQ DUH EDVLFDOO\ LQGLVWLQJXLVKDEOH IURP OHJDOO\ UHVLGHQW DOLHQ FKLOGUHQ )LQDOO\ DSSHOODQWV VXJJHVW WKDW XQGRFXPHQWHG FKLOGUHQ DUH DSSURSULDWHO\ VLQJOHG RXW EHFDXVH WKHLU XQODZIXO SUHVHQFH ZLWKLQ WKH 8QLWHG 6WDWHV UHQGHUV WKHP OHVV OLNHO\ WKDQ RWKHU FKLOGUHQ WR UHPDLQ ZLWKLQ WKH ERXQGDULHV RI WKH 6WDWH DQG WR SXW WKHLU HGXFDWLRQ WR SURGXFWLYH VRFLDO RU SROLWLFDO XVH ZLWKLQ WKH 6WDWH (YHQ DVVXPLQJ WKDW VXFK DQ LQWHUHVW LV OHJLWLPDWH LW LV DQ LQWHUHVW WKDW LV PRVW GLIILFXOW WR TXDQWLI\ 7KH 6WDWH KDV QR DVVXUDQFH WKDW DQ\ FKLOG FLWL]HQ RU QRW ZLOO HPSOR\ WKH HGXFDWLRQ SURYLGHG E\ WKH 6WDWH ZLWKLQ WKH FRQILQHV RI WKH 6WDWHnV ERUGHUV ,Q DQ\ HYHQW WKH UHFRUG LV FOHDU WKDW PDQ\ RI WKH XQGRFXPHQWHG FKLOGUHQ GLVDEOHG E\ WKLV FODVVLILFDWLRQ ZLOO UHPDLQ LQ WKLV FRXQWU\ LQGHILQLWHO\ DQG WKDW VRPH ZLOO EHFRPH ODZIXO UHVLGHQWV RU FLWL]HQV RI WKH 8QLWHG 6WDWHV ,W LV GLIILFXOW WR XQGHUVWDQG SUHFLVHO\ ZKDW WKH 6WDWH KRSHV WR DFKLHYH E\ SURPRWLQJ WKH )6XSS S )6XSS S ,ELG S )6XSS S DQG Q 86

PAGE 181

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f FRQWLQXH WR EHOLHYH WKDW DQ LQGLYLGXDOnV LQWHUHVW LQ HGXFDWLRQ LV IXQGDPHQWDO DQG WKDW WKLV YLHZ LV DPSO\ VXSSRUWHG E\ WKH XQLTXH VWDWXV DFFRUGHG SXEOLF HGXFDWLRQ E\ RXU VRFLHW\ DQG E\ WKH FORVH UHODWLRQVKLS EHWZHHQ HGXFDWLRQ DQG VRPH RI RXU PRVW EDVLF FRQVWLWXWLRQDO YDOXHV )XUWKHUPRUH EHOLHYH WKDW WKH IDFWV RI WKHVH FDVHV GHPRQVWUDWH WKH ZLVGRP RI UHMHFWLQJ D ULJLGLILHG DSSURDFK WR HTXDO SURWHFWLRQ DQDO\VLV DQG RI HPSOR\LQJ DQ DSSURDFK WKDW DOORZV IRU YDU\LQJ OHYHOV RI VFUXWLQ\ GHSHQGLQJ XSRQ WKH FRQVWLWXWLRQDO DQG VRFLHWDO LPSRUWDQFH RI WKH LQWHUHVW DGYHUVHO\ DIIHFWHG DQG WKH UHFRJQL]HG LQYLGLRXVQHVV RI WKH 86

PAGE 182

EDVLV XSRQ ZKLFK WKH SDUWLFXODU FODVVLILFDWLRQ LV GUDZQ ,W FRQWLQXHV WR EH P\ YLHZ WKDW D FODVVEDVHG GHQLDO RI SXEOLF HGXFDWLRQ LV XWWHUO\ LQFRPSDWLEOH ZLWK WKH (TXDO 3URWHFWLRQ &ODXVH RI WKH )RXUWHHQWK $PHQGPHQW %/$&.081 FRQFXUULQJ -867,&( %/$&.081 FRQFXUULQJ MRLQ WKH RSLQLRQ DQG MXGJPHQW RI WKH &RXUW /LNH -867,&( 32:(// EHOLHYH WKDW WKH FKLOGUHQ LQYROYHG LQ WKLV OLWLJDWLRQ fVKRXOG QRW EH OHIW RQ WKH VWUHHWV XQHGXFDWHGf ZULWH VHSDUDWHO\ KRZHYHU EHFDXVH LQ P\ YLHZ WKH QDWXUH RI WKH LQWHUHVW DW VWDNH LV FUXFLDO WR WKH SURSHU UHVROXWLRQ RI WKHVH FDVHV 7KH fIXQGDPHQWDO ULJKWVf DVSHFW RI WKH &RXUWnV HTXDO SURWHFWLRQ DQDO\VLV WKH QRZIDPLOLDU FRQFHSW WKDW JRYHUQPHQWDO FODVVLILFDWLRQV EHDULQJ RQ FHUWDLQ LQWHUHVWV PXVW EH FORVHO\ VFUXWLQL]HG KDV EHHQ WKH VXEMHFW RI VRPH FRQWURYHUV\ -XVWLFH +DUODQ IRU H[DPSOH ZDUQHG WKDW YLUWXDOO\ HYHU\ VWDWH VWDWXWH DIIHFWV LPSRUWDQW ULJKWV 7R H[WHQG WKH fFRPSHOOLQJ LQWHUHVWf UXOH WR DOO FDVHV LQ ZKLFK VXFK ULJKWV DUH DIIHFWHG ZRXOG JR IDU WRZDUG PDNLQJ WKLV &RXUW D fVXSHUOHJLVODWXUHf 2WKHUV KDYH QRWHG WKDW VWULFW VFUXWLQ\ XQGHU WKH (TXDO 3URWHFWLRQ &ODXVH LV XQQHFHVVDU\ ZKHQ FODVVLILFDWLRQV LQIULQJLQJ HQXPHUDWHG FRQVWLWXWLRQDO ULJKWV DUH LQYROYHG IRU D VWDWH ODZ WKDW LPSLQJHV XSRQ D VXEVWDQWLYH ULJKW RU OLEHUW\ FUHDWHG RU FRQIHUUHG E\ WKH &RQVWLWXWLRQ LV RI FRXUVH SUHVXPSWLYHO\ LQYDOLG ZKHWKHU RU QRW WKH ODZnV SXUSRVH RU HIIHFW LV WR FUHDWH DQ\ ,ELG S 6HH DOVR 'DQGULGJH Y :LOOLDPV 86 f 0$56+$// GLVVHQWLQJf ,QI S 6KDSLUR Y 7KRPSVRQ 86 f GLVVHQWLQJ RSLQLRQf

PAGE 183

FODVVLILFDWLRQV 6WLOO RWKHUV KDYH VXJJHVWHG WKDW IXQGDPHQWDO ULJKWV DUH QRW SURSHUO\ D SDUW RI HTXDO SURWHFWLRQ DQDO\VLV DW DOO EHFDXVH WKH\ DUH XQUHODWHG WR DQ\ GHILQHG SULQFLSOH RI HTXDOLW\ 7KHVH FRQVLGHUDWLRQV FRPELQHG ZLWK GRXEWV DERXW WKH MXGLFLDU\nV DELOLW\ WR PDNH ILQH GLVWLQFWLRQV LQ DVVHVVLQJ WKH HIIHFWV RI FRPSOH[ VRFLDO SROLFLHV OHG WKH &RXUW LQ 5RGULJXH] WR DUWLFXODWH D ILUP UXOH IXQGDPHQWDO ULJKWV DUH WKRVH WKDW fH[SOLFLWO\ RU LPSOLFLWO\ >DUH@ JXDUDQWHHG E\ WKH &RQVWLWXWLRQf ,W WKHUHIRUH VTXDUHO\ UHMHFWHG WKH QRWLRQ WKDW fDQ DG KRF GHWHUPLQDWLRQ DV WR WKH VRFLDO RU HFRQRPLF LPSRUWDQFHf RI D JLYHQ LQWHUHVW LV UHOHYDQW WR WKH OHYHO RI VFUXWLQ\ DFFRUGHG FODVVLILFDWLRQV LQYROYLQJ WKDW LQWHUHVW DQG PDGH FOHDU WKDW fLW LV QRW WKH SURYLQFH RI WKLV &RXUW WR FUHDWH VXEVWDQWLYH FRQVWLWXWLRQDO ULJKWV LQ WKH QDPH RI JXDUDQWHHLQJ HTXDO SURWHFWLRQ RI WKH ODZVf MRLQHG -867,&( 32:(//nV RSLQLRQ IRU WKH &RXUW LQ 5RGULJXH] DQG FRQWLQXH WR EHOLHYH WKDW LW SURYLGHV WKH DSSURSULDWH PRGHO IRU UHVROYLQJ PRVW HTXDO SURWHFWLRQ GLVSXWHV &ODVVLILFDWLRQV LQIULQJLQJ VXEVWDQWLYH FRQVWLWXWLRQDO ULJKWV QHFHVVDULO\ ZLOO EH LQYDOLG LI QRW E\ IRUFH RI WKH (TXDO 3URWHFWLRQ &ODXVH WKHQ WKURXJK RSHUDWLRQ RI RWKHU SURYLVLRQV RI WKH &RQVWLWXWLRQ &RQYHUVHO\ FODVVLILFDWLRQV EHDULQJ RQ QRQFRQVWLWXWLRQDO LQWHUHVWV f§ HYHQ WKRVH LQYROYLQJ fWKH PRVW EDVLF HFRQRPLF QHHGV RI LPSRYHULVKHG KXPDQ EHLQJVf JHQHUDOO\ DUH QRW VXEMHFW WR VSHFLDO WUHDWPHQW XQGHU WKH (TXDO 3URWHFWLRQ 6DQ $QWRQLR ,QGHSHQGHQW 6FKRRO 'LVWULFW Y 5RGULJXH] $ 86 f 6WHZDUW FRQFXUULQJf 6HH 6KDSLUR Y 7KRPSVRQ 86 S +DUODQ GLVVHQWLQJf 3HUU\ 0RGHP (TXDO 3URWHFWLRQ $ &RQFHSWXDOL]DWLRQ DQG $SSUDLVDO &ROXP/5HY SS f 86SS ,ELG SS 'DQGULGJH Y :LOOLDPV 86 S f

PAGE 184

&ODXVH EHFDXVH WKH\ DUH QRW GLVWLQJXLVKDEOH LQ DQ\ UHOHYDQW ZD\ IURP RWKHU UHJXODWLRQV LQ fWKH DUHD RI HFRQRPLFV DQG VRFLDO ZHOIDUHf :LWK DOO WKLV VDLG KRZHYHU EHOLHYH WKH &RXUWnV H[SHULHQFH KDV GHPRQVWUDWHG WKDW WKH 5RGULJXH] IRUPXODWLRQ GRHV QRW VHWWOH HYHU\ LVVXH RI fIXQGDPHQWDO ULJKWVf DULVLQJ XQGHU WKH (TXDO 3URWHFWLRQ &ODXVH 2QO\ D SHGDQW ZRXOG LQVLVW WKDW WKHUH DUH QR PHDQLQJIXO GLVWLQFWLRQV DPRQJ WKH PXOWLWXGH RI VRFLDO DQG SROLWLFDO LQWHUHVWV UHJXODWHG E\ WKH 6WDWHV DQG 5RGULJXH] GRHV QRW VWDQG IRU TXLWH VR DEVROXWH D SURSRVLWLRQ 7R WKH FRQWUDU\ 5RGULJXH] LPSOLFLWO\ DFNQRZOHGJHG WKDW FHUWDLQ LQWHUHVWV WKRXJK QRW FRQVWLWXWLRQDOO\ JXDUDQWHHG PXVW EH DFFRUGHG D VSHFLDO SODFH LQ HTXDO SURWHFWLRQ DQDO\VLV 7KXV WKH &RXUWnV GHFLVLRQV ORQJ KDYH DFFRUGHG VWULFW VFUXWLQ\ WR FODVVLILFDWLRQV EHDULQJ RQ WKH ULJKW WR YRWH LQ VWDWH HOHFWLRQV DQG 5RGULJXH] FRQILUPHG WKH fFRQVWLWXWLRQDO XQGHUSLQQLQJV RI WKH ULJKW WR HTXDO WUHDWPHQW LQ WKH YRWLQJ SURFHVVf
PAGE 185

SROLWLFDO SURFHVV 7KRVH GHQLHG WKH YRWH DUH UHOHJDWHG E\ VWDWH ILDW LQ D PRVW EDVLF ZD\ WR VHFRQGFODVV VWDWXV ,W LV DUJXDEOH RI FRXUVH WKDW WKH &RXUW QHYHU VKRXOG KDYH DSSOLHG IXQGDPHQWDO ULJKWV GRFWULQH LQ WKH IDVKLRQ RXWOLQHG DERYH -XVWLFH +DUODQ IRU RQH PDLQWDLQHG WKDW VWULFW HTXDO SURWHFWLRQ VFUXWLQ\ ZDV DSSURSULDWH RQO\ ZKHQ UDFLDO RU DQDORJRXV FODVVLILFDWLRQV ZHUH DW LVVXH %XW LW LV WRR ODWH WR GHEDWH WKDW SRLQW DQG EHOLHYH WKDW DFFHSWLQJ WKH SULQFLSOH RI WKH YRWLQJ FDVHV WKH LGHD WKDW VWDWH FODVVLILFDWLRQV EHDULQJ RQ FHUWDLQ LQWHUHVWV SRVH WKH ULVN RI DOORFDWLQJ ULJKWV LQ D IDVKLRQ LQKHUHQWO\ FRQWUDU\ WR DQ\ QRWLRQ RI fHTXDOLW\f f§ GLFWDWHV WKH RXWFRPH KHUH $V ERWK -867,&( 32:(// DQG 7+( &+,() -867,&( REVHUYH WKH 7H[DV VFKHPH LQHYLWDEO\ ZLOO FUHDWH fD VXEFODVV RI LOOLWHUDWH SHUVRQVf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fFLWL]HQf DGYLVHGO\ 7KH ULJKW WR YRWH RI FRXUVH LV D SROLWLFDO LQWHUHVW RI FRQFHUQ WR FLWL]HQV 7KH ULJKW WR DQ HGXFDWLRQ LQ FRQWUDVW LV D VRFLDO EHQHILW RI UHOHYDQFH WR D VXEVWDQWLDO QXPEHU RI WKRVH DIIHFWHG E\ 7H[DVn VWDWXWRU\ VFKHPH DV LV GLVFXVVHG EHORZ@ 6KDSLUR Y 7KRPSVRQ 86 DW GLVVHQWLQJ RSLQLRQf 6HH 5H\QROGV Y 6LPV 86 DW +DUODQ GLVVHQWLQJf ,QI S 32:(// FRQFXUULQJf VHH LQIUD S %85*(5 &GLVVHQWLQJf >7KH &RXUW FRQFOXGHV WKDW WKH SURYLVLRQ DW LVVXH PXVW EH LQYDOLGDWHG XQOHVV LW IXUWKHUV VRPH VXEVWDQWLDO JRDO RI WKH 6WDWH ,ELG S 6LQFH WKH VWDWXWH IDLOV WR VXUYLYH WKLV OHYHO RI VFUXWLQ\ DV WKH &RXUW GHPRQVWUDWHV WKHUH LV QR QHHG WR GHWHUPLQH ZKHWKHU D PRUH SURELQJ OHYHO RI UHYLHZ ZRXOG EH DSSURSULDWH@

PAGE 186

ZKHQ WKRVH FKLOGUHQ DUH PHPEHUV RI DQ LGHQWLILDEOH JURXS WKDW JURXS WKURXJK WKH 6WDWHnV DFWLRQ f§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nV ODFN RI VSHFLDOL]HG NQRZOHGJH DQG H[SHULHQFH FRXQVHOV DJDLQVW SUHPDWXUH LQWHUIHUHQFH ZLWK WKH LQIRUPHG MXGJPHQWV PDGH DW WKH VWDWH DQG ORFDO OHYHOV 7KXV 5RGULJXH] KHOG DQG WKH &RXUW QRZ UHDIILUPV WKDW fD 6WDWH QHHG QRW MXVWLI\ E\ FRPSHOOLQJ QHFHVVLW\ HYHU\ YDULDWLRQ LQ WKH PDQQHU LQ ZKLFK HGXFDWLRQ LV SURYLGHG WR LWV SRSXODWLRQf &I 5RGULJXH] 86 S Q 0$56+$// GLVVHQWLQJf 86 &I 5RGULJXH] 86 S ,ELG S

PAGE 187

f f 6LPLODUO\ LW LV XQGHQLDEOH WKDW HGXFDWLRQ LV QRW D fIXQGDPHQWDO ULJKWf LQ WKH VHQVH WKDW LW LV FRQVWLWXWLRQDOO\ JXDUDQWHHG +HUH KRZHYHU WKH 6WDWH KDV XQGHUWDNHQ WR SURYLGH DQ HGXFDWLRQ WR PRVW RI WKH FKLOGUHQ UHVLGLQJ ZLWKLQ LWV ERUGHUV $QG LQ FRQWUDVW WR WKH VLWXDWLRQ LQ 5RGULJXH] LW GRHV QRW WDNH DQ DGYDQFHG GHJUHH WR SUHGLFW WKH HIIHFWV RI D FRPSOHWH GHQLDO RI HGXFDWLRQ XSRQ WKRVH FKLOGUHQ WDUJHWHG E\ WKH 6WDWHnV FODVVLILFDWLRQ ,Q VXFK FLUFXPVWDQFHV WKH YRWLQJ GHFLVLRQV VXJJHVW WKDW WKH 6WDWH PXVW RIIHU VRPHWKLQJ PRUH WKDQ D UDWLRQDO EDVLV IRU LWV FODVVLILFDWLRQ &RQFHGHGO\ LW ZRXOG VHHP LURQLF WR GLVFXVV WKH VRFLDO QHFHVVLW\ RI DQ HGXFDWLRQ LQ D FDVH WKDW FRQFHUQHG RQO\ XQGRFXPHQWHG DOLHQV fZKRVH YHU\ SUHVHQFH LQ WKH VWDWH DQG WKLV FRXQWU\ LV LOOHJDOf %XW EHFDXVH RI WKH QDWXUH RI WKH IHGHUDO LPPLJUDWLRQ ODZV DQG WKH SUHHPLQHQW UROH RI WKH )HGHUDO *RYHUQPHQW LQ UHJXODWLQJ LPPLJUDWLRQ WKH FODVV RI FKLOGUHQ KHUH LV QRW D PRQROLWKLF RQH 7KXV WKH 'LVWULFW &RXUW LQ WKH $OLHQ &KLOGUHQ (GXFDWLRQ FDVH IRXQG DV D IDFWXDO PDWWHU WKDW D VLJQLILFDQW QXPEHU RI LOOHJDO DOLHQV ZLOO UHPDLQ LQ WKLV FRXQWU\ SHUPDQHQWO\ WKDW VRPH RI WKH FKLOGUHQ LQYROYHG LQ WKLV OLWLJDWLRQ DUH fGRFXPHQWDEOHf DQG WKDW f>P@DQ\ RI WKH XQGRFXPHQWHG FKLOGUHQ DUH QRW GHSRUWDEOH 1RQH RI WKH QDPHG SODLQWLIIV LV XQGHU DQ RUGHU RI GHSRUWDWLRQf $V WKH &RXUWnV DOLHQDJH FDVHV GHPRQVWUDWH WKHVH FKLOGUHQ PD\ QRW EH GHQLHG ULJKWV WKDW DUH ,ELG S ,QI S %85*(5 &GLVVHQWLQJf > 86 @ )6XSS 6' 7H[f ,ELG S ,ELG S Q

PAGE 188

JUDQWHG WR FLWL]HQV H[FHSWLQJ RQO\ WKRVH ULJKWV EHDULQJ RQ SROLWLFDO LQWHUHVWV $QG DV -867,&( 32:(// QRWHV WKH VWUXFWXUH RI WKH LPPLJUDWLRQ VWDWXWHV PDNHV LW LPSRVVLEOH IRU WKH 6WDWH WR GHWHUPLQH ZKLFK DOLHQV DUH HQWLWOHG WR UHVLGHQFH DQG ZKLFK HYHQWXDOO\ ZLOO EH GHSRUWHG ,QGHHG DQ\ DWWHPSW WR GR VR ZRXOG LQYROYH WKH 6WDWH LQ WKH DGPLQLVWUDWLRQ RI WKH LPPLJUDWLRQ ODZV :KDWHYHU WKH 6WDWHnV SRZHU WR FODVVLI\ GHSRUWDEOH DOLHQV WKHQ f§ DQG ZKDWHYHU WKH )HGHUDO *RYHUQPHQWnV DELOLW\ WR GUDZ PRUH SUHFLVH DQG PRUH DFFHSWDEOH DOLHQDJH FODVVLILFDWLRQV WKH VWDWXWH DW LVVXH KHUH VZHHSV ZLWKLQ LW D VXEVWDQWLDO QXPEHU RI FKLOGUHQ ZKR ZLOO LQ IDFW DQG ZKR PD\ ZHOO EH HQWLWOHG WR UHPDLQ LQ WKH 8QLWHG 6WDWHV *LYHQ WKH H[WUDRUGLQDU\ QDWXUH RI WKH LQWHUHVW LQYROYHG WKLV PDNHV WKH FODVVLILFDWLRQ KHUH IDWDOO\ LPSUHFLVH $QG DV WKH &RXUW GHPRQVWUDWHV WKH 7H[DV OHJLVODWLRQ LV QRW RWKHUZLVH VXSSRUWHG E\ DQ\ VXEVWDQWLDO LQWHUHVWV %HFDXVH EHOLHYH WKDW WKH &RXUWn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f ,QI S Q XV > 86 @

PAGE 189

E\ RWKHU EHQHILWV DV ZHOO 7KLV LV D SUREOHP RI VHULRXV QDWLRQDO SURSRUWLRQV DV WKH $WWRUQH\ *HQHUDO UHFHQWO\ KDV UHFRJQL]HG 3HUKDSV EHFDXVH RI WKH LQWUDFWDELOLW\ RI WKH SUREOHP &RQJUHVV f§ YHVWHG E\ WKH &RQVWLWXWLRQ ZLWK WKH UHVSRQVLELOLW\ RI SURWHFWLQJ RXU ERUGHUV DQG OHJLVODWLQJ ZLWK UHVSHFW WR DOLHQV f§ KDV QRW SURYLGHG HIIHFWLYH OHDGHUVKLS LQ GHDOLQJ ZLWK WKLV SUREOHP ,W LV FHUWDLQ WKDW LOOHJDO DOLHQV ZLOO FRQWLQXH WR HQWHU WKH 8QLWHG 6WDWHV DQG DV WKH UHFRUG PDNHV FOHDU DQ XQNQRZQ SHUFHQWDJH RI WKHP ZLOO UHPDLQ KHUH DJUHH ZLWK WKH &RXUW WKDW WKHLU FKLOGUHQ VKRXOG QRW EH OHIW RQ WKH VWUHHWV XQHGXFDWHG $OWKRXJK WKH DQDORJ\ LV QRW SHUIHFW RXU KROGLQJ WRGD\ GRHV ILQG VXSSRUW LQ GHFLVLRQV RI WKLV &RXUW ZLWK UHVSHFW WR WKH VWDWXV RI LOOHJLWLPDWHV ,Q :HEHU Y $HWQD &DVXDOW\ t 6XUHW\ &R ZH VDLG f>9@LVLWLQJ FRQGHPQDWLRQ RQ WKH KHDG RI DQ LQIDQW IRU WKH PLVGHHGV RI WKH SDUHQWV LV LOORJLFDO XQMXVW DQG FRQWUDU\ WR WKH EDVLF FRQFHSW RI RXU V\VWHP WKDW OHJDO EXUGHQV VKRXOG EHDU VRPH UHODWLRQVKLS WR LQGLYLGXDO UHVSRQVLELOLW\ RU ZURQJGRLQJf ,Q WKHVH FDVHV WKH 6WDWH RI 7H[DV HIIHFWLYHO\ GHQLHV WR WKH VFKRRODJH FKLOGUHQ RI LOOHJDO DOLHQV WKH RSSRUWXQLW\ WR DWWHQG WKH IUHH SXEOLF VFKRROV WKDW WKH 6WDWH PDNHV DYDLODEOH WR DOO UHVLGHQWV 7KH\ DUH H[FOXGHG RQO\ EHFDXVH RI D VWDWXV UHVXOWLQJ IURP WKH YLRODWLRQ E\ SDUHQWV RU JXDUGLDQV RI RXU LPPLJUDWLRQ ODZV DQG WKH IDFW WKDW WKH\ UHPDLQ LQ ,ELG S Q > 86 @ 86 f

PAGE 190

RXU FRXQWU\ XQODZIXOO\ 7KH DSSHOOHH FKLOGUHQ DUH LQQRFHQW LQ WKLV UHVSHFW 7KH\ FDQ fDIIHFW QHLWKHU WKHLU SDUHQWVf FRQGXFW QRU WKHLU RZQ VWDWXVf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f7KH &RQJUHVV VKDOO KDYH 3RZHU 7R HVWDEOLVK DQ XQLIRUP 5XOH RI 1DWXUDOL]DWLRQf 7KH )HGHUDO *RYHUQPHQW KDV EURDG FRQVWLWXWLRQDO SRZHUV LQ GHWHUPLQLQJ ZKDW DOLHQV VKDOO EH DGPLWWHG WR WKH 8QLWHG 6WDWHV WKH SHULRG WKH\ PD\ UHPDLQ UHJXODWLRQ RI WKHLU FRQGXFW EHIRUH QDWXUDOL]DWLRQ DQG WKH WHUPV DQG FRQGLWLRQV RI WKHLU QDWXUDOL]DWLRQ 7DNDKDVKL Y )LVK t *DPH &RPPLVVLRQ 86 f 6HH *UDKDP Y 5LFKDUGVRQ 86 f UHJXODWLRQ RI DOLHQV LV fFRQVWLWXWLRQDOO\ HQWUXVWHG WR WKH )HGHUDO *RYHUQPHQWff 7KH &RXUW KDV WUDGLWLRQDOO\ VKRZQ JUHDW GHIHUHQFH WR IHGHUDO DXWKRULW\ RYHU LPPLJUDWLRQ DQG WR IHGHUDO FODVVLILFDWLRQV EDVHG XSRQ DOLHQDJH 6HH HJ )LDOOR Y %HOO 86 f fLW LV LPSRUWDQW WR XQGHUVFRUH WKH OLPLWHG VFRSH RI MXGLFLDO LQTXLU\ LQWR LPPLJUDWLRQ OHJLVODWLRQff +DULVLDGHV Y 6KDXJKQHVV\ 86 f f,W LV SHUWLQHQW WR REVHUYH WKDW DQ\ SROLF\ WRZDUG DOLHQV LV YLWDOO\ DQG LQWULFDWHO\ LQWHUZRYHQ ZLWK FRQWHPSRUDQHRXV SROLFLHV LQ UHJDUG WR WKH FRQGXFW RI IRUHLJQ UHODWLRQV WKH ZDU SRZHU DQG WKH PDLQWHQDQFH RI D UHSXEOLFDQ IRUP RI JRYHUQPHQW 6XFK PDWWHUV DUH VR H[FOXVLYHO\ HQWUXVWHG WR WKH SROLWLFDO EUDQFKHV RI JRYHUQPHQW DV WR EH ODUJHO\ LPPXQH IURP MXGLFLDO LQTXLU\ RU LQWHUIHUHQFHff ,QGHHG HYHQ HTXDO SURWHFWLRQ DQDO\VLV LQ WKLV DUHD LV EDVHG WR D ODUJH H[WHQW RQ DQ XQGHUO\LQJ WKHPH RI SUHHPSWLRQ DQG H[FOXVLYH IHGHUDO SRZHU RYHU LPPLJUDWLRQ 6HH 7DNDKDVKL Y )LVK t *DPH &RPPLVVLRQ S WKH )HGHUDO *RYHUQPHQW KDV DGPLWWHG UHVLGHQW DOLHQV WR WKH FRXQWU\ fRQ DQ HTXDOLW\ RI OHJDO SULYLOHJHV ZLWK DOO FLWL]HQV XQGHU QRQGLVFULPLQDWRU\ ODZVf DQG WKH 6WDWHV PD\ QRW DOWHU WKH WHUPV RI WKLV DGPLVVLRQf &RPSDUH *UDKDP Y 5LFKDUGVRQ DQG 6XJDUPDQ Y 'RXJDOO 86 f ZLWK 0DWKHZV Y 'LD] 86 f DQG +DPSWRQ Y 0RZ 6XQ :RQJ 86 f *LYHQ WKDW WKH 6WDWHVn SRZHU WR UHJXODWH LQ WKLV DUHD LV VR OLPLWHG DQG WKDW WKLV LV DQ DUHD RI VXFK SHFXOLDUO\ VWURQJ IHGHUDO DXWKRULW\ WKH QHFHVVLW\ RI IHGHUDO OHDGHUVKLS VHHPV HYLGHQW@ 7ULPEOH Y *RUGRQ 86 f ,ELG S &I &UDLJ Y %RUHQ 86 f > 86 @ >, HPSKDVL]H WKH &RXUWfV FRQFOXVLRQ WKDW VWULFW VFUXWLQ\ LV QRW DSSURSULDWHO\ DSSOLHG WR WKLV FODVVLILFDWLRQ 7KLV H[DFWLQJ VWDQGDUG RI UHYLHZ KDV EHHQ UHVHUYHG IRU LQVWDQFHV LQ ZKLFK D fIXQGDPHQWDOf FRQVWLWXWLRQDO ULJKW RU D fVXVSHFWf FODVVLILFDWLRQ LV SUHVHQW 1HLWKHU LV SUHVHQW LQ WKHVH FDVHV DV WKH &RXUW KROGV@

PAGE 191

UHTXLUH WKDW WKH 6WDWHnV LQWHUHVWV EH VXEVWDQWLDO DQG WKDW WKH PHDQV EHDU D fIDLU DQG VXEVWDQWLDO UHODWLRQf WR WKHVH LQWHUHVWV ,Q P\ YLHZ WKH 6WDWHnV GHQLDO RI HGXFDWLRQ WR WKHVH FKLOGUHQ EHDUV QR VXEVWDQWLDO UHODWLRQ WR DQ\ VXEVWDQWLDO VWDWH LQWHUHVW %RWK RI WKH 'LVWULFW &RXUWV IRXQG WKDW DQ XQFHUWDLQ EXW VLJQLILFDQW SHUFHQWDJH RI LOOHJDO DOLHQ FKLOGUHQ ZLOO UHPDLQ LQ 7H[DV DV UHVLGHQWV DQG PDQ\ HYHQWXDOO\ ZLOO EHFRPH FLWL]HQV 7KH GLVFXVVLRQ E\ WKH &RXUW RI WKH 6WDWHn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f fFODVVLILFDWLRQV EDVHG RQ LOOHJLWLPDF\ DUH LQYDOLG XQGHU WKH )RXUWHHQWK $PHQGPHQW LI WKH\ DUH QRW VXEVWDQWLDOO\ UHODWHG WR SHUPLVVLEOH VWDWH LQWHUHVWVff ,ELG S fDV WKH 6WDWHnV LQWHUHVWV DUH VXEVWDQWLDO ZH QRZ FRQVLGHU WKH PHDQV DGRSWHGff >7+( &+,() -867,&( DUJXHV LQ KLV GLVVHQWLQJ RSLQLRQ WKDW WKLV KHLJKWHQHG VWDQGDUG RI UHYLHZ LV LQFRQVLVWHQW ZLWK WKH &RXUWnV GHFLVLRQ LQ 6DQ $QWRQLR ,QGHSHQGHQW 6FKRRO 'LVWULFW Y 5RGULJXH] 86 f %XW LQ 5RGULJXH] QR JURXS RI FKLOGUHQ ZDV VLQJOHG RXW E\ WKH 6WDWH DQG WKHQ SHQDOL]HG EHFDXVH RI WKHLU SDUHQWVn VWDWXV 5DWKHU IXQGLQJ IRU HGXFDWLRQ YDULHG DFURVV WKH 6WDWH EHFDXVH RI WKH WUDGLWLRQ RI ORFDO FRQWURO 1RU LQ WKDW FDVH ZDV DQ\ JURXS RI FKLOGUHQ WRWDOO\ GHSULYHG RI DOO HGXFDWLRQ DV LQ WKHVH FDVHV ,I WKH UHVLGHQW FKLOGUHQ RI LOOHJDO DOLHQV ZHUH GHQLHG ZHOIDUH DVVLVWDQFH PDGH DYDLODEOH E\ JRYHUQPHQW WR DOO RWKHU FKLOGUHQ ZKR TXDOLI\ WKLV DOVR f§ LQ P\ RSLQLRQ ZRXOG EH DQ LPSHUPLVVLEOH SHQDOL]LQJ RI FKLOGUHQ EHFDXVH RI WKHLU SDUHQWVn VWDWXV@ > 86 @ >7KH 6WDWH SURYLGHV IUHH SXEOLF HGXFDWLRQ WR DOO ODZIXO UHVLGHQWV ZKHWKHU WKH\ LQWHQG WR UHVLGH SHUPDQHQWO\ LQ WKH 6WDWH RU RQO\ UHVLGH LQ WKH 6WDWH WHPSRUDULO\ S Q 2I FRXUVH D VFKRRO GLVWULFW PD\ UHTXLUH WKDW LOOHJDO DOLHQ FKLOGUHQ OLNH DQ\ RWKHU FKLOGUHQ DFWXDOO\ UHVLGH LQ WKH VFKRRO GLVWULFW EHIRUH DGPLWWLQJ WKHP WR WKH VFKRROV $ UHTXLUHPHQW RI GH IDFWR UHVLGHQF\ XQLIRUPO\ DSSOLHG ZRXOG QRW YLRODWH DQ\ SULQFLSOH RI HTXDO SURWHFWLRQ@

PAGE 192

H[FOXVLRQ RI DSSHOOHHVn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f (YHQ VR LW LV FOHDU WKDW QHLWKHU FODVV ZDV WKRXJKW WR LQFOXGH PDWXUH 0H[LFDQ PLQRUV ZKR ZHUH VROHO\ UHVSRQVLEOH IRU YLRODWLQJ WKH LPPLJUDWLRQ ODZV ,Q )6XSS (' 7H[f WKH FRXUW FKDUDFWHUL]HG SODLQWLIIV DV fHQWLUH IDPLOLHV ZKR KDYH PLJUDWHG LOOHJDOO\f ,ELG S $ SDUHQW RU JXDUGLDQ UHSUHVHQWHG HDFK RI WKH SODLQWLII FKLOGUHQ LQ WKDW FDVH 6LPLODUO\ WKH FRXUW LQ ,Q UH $OLHQ &KLOGUHQ (GXFDWLRQ /LWLJDWLRQ IRXQG WKDW fXQGRFXPHQWHG FKLOGUHQ GR QRW HQWHU WKH 8QLWHG 6WDWHV XQDFFRPSDQLHG E\ WKHLU SDUHQWVf )6XSS S $ GLIIHUHQW FDVH ZRXOG EH SUHVHQWHG LQ WKH XQOLNHO\ HYHQW WKDW D PLQRU ROG HQRXJK WR EH UHVSRQVLEOH IRU LOOHJDO HQWU\ DQG \HW VWLOO RI VFKRRO DJH HQWHUHG WKLV FRXQWU\ LOOHJDOO\ RQ KLV RZQ YROLWLRQ@ > 86@ >,Q DGGLWLRQ WKH 6WDWHVf DELOLW\ WR UHVSRQG RQ WKHLU RZQ WR WKH SUREOHPV FDXVHG E\ WKLV PLJUDWLRQ PD\ EH OLPLWHG E\ WKH SULQFLSOHV RI SUHHPSWLRQ WKDW DSSO\ LQ WKLV DUHD 6HH HJ +LQHV Y 'DYLGRZLW] 86 f ,Q 'H &DQDV Y %LFD 86 f WKH &RXUW IRXQG WKDW D VWDWH ODZ PDNLQJ LW D FULPLQDO RIIHQVH WR HPSOR\ LOOHJDO DOLHQV ZDV QRW SUHHPSWHG E\ IHGHUDO DXWKRULW\ RYHU DOLHQV DQG LPPLJUDWLRQ 7KH &RXUW IRXQG HYLGHQFH WKDW &RQJUHVV LQWHQGHG VWDWH UHJXODWLRQ LQ WKLV DUHD ,ELG S fWKHUH LV HYLGHQFH WKDW &RQJUHVV LQWHQGV WKDW 6WDWHV PD\ WR WKH H[WHQW FRQVLVWHQW ZLWK IHGHUDO ODZ UHJXODWH WKH HPSOR\PHQW RI LOOHJDO DOLHQVff 0RUHRYHU XQGHU IHGHUDO LPPLJUDWLRQ ODZ RQO\ LPPLJUDQW DOLHQV DQG QRQLPPLJUDQW DOLHQV ZLWK VSHFLDO SHUPLVVLRQ DUH HQWLWOHG WR ZRUN 6HH & *RUGRQ t + 5RVHQILHOG ,PPLJUDWLRQ /DZ DQG 3URFHGXUH D E f %HFDXVH IHGHUDO ODZ FOHDUO\ LQGLFDWHV WKDW RQO\ FHUWDLQ VSHFLILHG DOLHQV PD\ ODZIXOO\ ZRUN LQ WKH FRXQWU\ DQG EHFDXVH WKHVH DOLHQV KDYH GRFXPHQWDWLRQ HVWDEOLVKLQJ WKLV ULJKW WKH 6WDWH LQ 'H &DQDV ZDV DEOH WR LGHQWLI\ ZLWK FHUWDLQW\ ZKLFK DOLHQV KDG D IHGHUDO SHUPLVVLRQ WR ZRUN LQ WKLV FRXQWU\ 7KH 6WDWH GLG QRW QHHG WR FRQFHUQ LWVHOI ZLWK DQ DOLHQnV FXUUHQW RU IXWXUH GHSRUWDELOLW\ %\ FRQWUDVW WKHUH LV QR FRPSDUDEOH IHGHUDO JXLGDQFH LQ WKH DUHD RI HGXFDWLRQ 1R IHGHUDO ODZ LQYLWHV VWDWH UHJXODWLRQ QR IHGHUDO UHJXODWLRQV LGHQWLI\ WKRVH DOLHQV ZKR KDYH D ULJKW WR DWWHQG SXEOLF VFKRROV ,Q DGGLWLRQ WKH 7H[DV HGXFDWLRQDO H[FOXVLRQ UHTXLUHV WKH 6WDWH WR PDNH SUHGLFWLRQV DV WR ZKHWKHU LQGLYLGXDO DOLHQV HYHQWXDOO\ ZLOO EH IRXQG WR EH GHSRUWDEOH %XW LW LV LPSRVVLEOH IRU D 6WDWH WR GHWHUPLQH ZKLFK DOLHQV WKH )HGHUDO *RYHUQPHQW ZLOO HYHQWXDOO\ GHSRUW ZKLFK WKH )HGHUDO *RYHUQPHQW ZLOO SHUPLW WR VWD\ DQG ZKLFK WKH )HGHUDO *RYHUQPHQW

PAGE 193

UDWLRQDOO\ WKDW DQ\RQH EHQHILWV IURP WKH FUHDWLRQ ZLWKLQ RXU ERUGHUV RI D VXEFODVV RI LOOLWHUDWH SHUVRQV PDQ\ RI ZKRP ZLOO UHPDLQ LQ WKH 6WDWH DGGLQJ WR WKH SUREOHPV DQG FRVWV RI ERWK 6WDWH DQG 1DWLRQDO *RYHUQPHQWV DWWHQGDQW XSRQ XQHPSOR\PHQW ZHOIDUH DQG FULPH %85*(5 GLVVHQWLQJ &+,() -867,&( %85*(5 ZLWK ZKRP -867,&( :+,7( -867,&( 5(+148,67 DQG -867,&( 2n&21125 MRLQ GLVVHQWLQJ :HUH LW RXU EXVLQHVV WR VHW WKH 1DWLRQnV VRFLDO SROLF\ ZRXOG DJUHH ZLWKRXW KHVLWDWLRQ WKDW LW LV VHQVHOHVV IRU DQ HQOLJKWHQHG VRFLHW\ WR GHSULYH DQ\ FKLOGUHQ LQFOXGLQJ LOOHJDO DOLHQV f§ RI DQ HOHPHQWDU\ HGXFDWLRQ IXOO\ DJUHH WKDW LW ZRXOG EH IROO\ DQG ZURQJ f§ WR WROHUDWH FUHDWLRQ RI D VHJPHQW RI VRFLHW\ PDGH XS RI LOOLWHUDWH SHUVRQV PDQ\ KDYLQJ D OLPLWHG RU QR FRPPDQG RI RXU ODQJXDJH +RZHYHU WKH &RQVWLWXWLRQ GRHV QRW FRQVWLWXWH XV DV f3ODWRQLF *XDUGLDQVf QRU GRHV LW YHVW LQ WKLV &RXUW WKH DXWKRULW\ WR VWULNH GRZQ ODZV EHFDXVH WKH\ GR QRW PHHW RXU VWDQGDUGV RI GHVLUDEOH VRFLDO SROLF\ fZLVGRPf RU fFRPPRQ VHQVHf :H WUHVSDVV RQ WKH DVVLJQHG IXQFWLRQ RI WKH SROLWLFDO EUDQFKHV XQGHU RXU VWUXFWXUH RI OLPLWHG DQG VHSDUDWHG SRZHUV ZKHQ ZH DVVXPH D SROLF\n PDNLQJ UROH DV WKH &RXUW GRHV WRGD\ ZLOO XOWLPDWHO\ QDWXUDOL]H 8QWLO DQ XQGRFXPHQWHG DOLHQ LV RUGHUHG GHSRUWHG E\ WKH )HGHUDO *RYHUQPHQW QR 6WDWH FDQ EH DVVXUHG WKDW WKH DOLHQ ZLOO QRW EH IRXQG WR KDYH D IHGHUDO SHUPLVVLRQ WR UHVLGH LQ WKH FRXQWU\ SHUKDSV HYHQ DV D FLWL]HQ ,QGHHG HYHQ WKH ,PPLJUDWLRQ DQG 1DWXUDOL]DWLRQ 6HUYLFH FDQQRW SUHGLFW ZLWK FHUWDLQW\ ZKHWKHU DQ\ LQGLYLGXDO DOLHQ KDV D ULJKW WR UHVLGH LQ WKH FRXQWU\ XQWLO GHSRUWDWLRQ SURFHHGLQJV KDYH UXQ WKHLU FRXUVH 6HH HJ 86& Kf HG DQG 6XSS ,9f@ > 86 @ 79$ Y +LOO 86 f

PAGE 194

7KH &RXUW PDNHV QR DWWHPSW WR GLVJXLVH WKDW LW LV DFWLQJ WR PDNH XS IRU &RQJUHVVf ODFN RI fHIIHFWLYH OHDGHUVKLSf LQ GHDOLQJ ZLWK WKH VHULRXV QDWLRQDO SUREOHPV FDXVHG E\ WKH LQIOX[ RI XQFRXQWDEOH PLOOLRQV RI LOOHJDO DOLHQV DFURVV RXU ERUGHUV 7KH IDLOXUH RI HQIRUFHPHQW RI WKH LPPLJUDWLRQ ODZV RYHU PRUH WKDQ D GHFDGH DQG WKH LQKHUHQW GLIILFXOW\ DQG H[SHQVH RI VHDOLQJ RXU YDVW ERUGHUV KDYH FRPELQHG WR FUHDWH D JUDYH VRFLRHFRQRPLF GLOHPPD ,W LV D GLOHPPD WKDW KDV QRW \HW HYHQ EHHQ IXOO\ DVVHVVHG OHW DORQH DGGUHVVHG +RZHYHU LW LV QRW WKH IXQFWLRQ RI WKH -XGLFLDU\ WR SURYLGH fHIIHFWLYH OHDGHUVKLSf VLPSO\ EHFDXVH WKH SROLWLFDO EUDQFKHV RI JRYHUQPHQW IDLO WR GR VR 7KH &RXUWnV KROGLQJ WRGD\ PDQLIHVWV WKH MXVWO\ FULWLFL]HG MXGLFLDO WHQGHQF\ WR DWWHPSW VSHHG\ DQG ZKROHVDOH IRUPXODWLRQ RI fUHPHGLHVf IRU WKH IDLOXUHV f§ RU VLPSO\ WKH ODJJDUG SDFH f§ RI WKH SROLWLFDO SURFHVVHV RI RXU V\VWHP RI JRYHUQPHQW 7KH &RXUW HPSOR\V DQG LQ P\ YLHZ DEXVHV WKH )RXUWHHQWK $PHQGPHQW LQ DQ HIIRUW WR EHFRPH DQ RPQLSRWHQW DQG RPQLVFLHQW SUREOHP VROYHU 7KDW WKH PRWLYHV IRU GRLQJ VR DUH QREOH DQG FRPSDVVLRQDWH GRHV QRW DOWHU WKH IDFW WKDW WKH &RXUW GLVWRUWV RXU FRQVWLWXWLRQDO IXQFWLRQ WR PDNH DPHQGV IRU WKH GHIDXOWV RI RWKHUV ,Q D VHQVH WKH &RXUWnV RSLQLRQ UHVWV RQ VXFK D XQLTXH FRQIOXHQFH RI WKHRULHV DQG UDWLRQDOHV WKDW LW ZLOO OLNHO\ VWDQG IRU OLWWOH EH\RQG WKH UHVXOWV LQ WKHVH SDUWLFXODU FDVHV 86 @ 32:(// -f FRQFXUULQJf

PAGE 195

FRQFHGHV WKLV fRQO\ EHJLQV WKH LQTXLU\f 7KH (TXDO 3URWHFWLRQ &ODXVH GRHV QRW PDQGDWH LGHQWLFDO WUHDWPHQW RI GLIIHUHQW FDWHJRULHV RI SHUVRQV 7KH GLVSRVLWLYH LVVXH LQ WKHVH FDVHV VLPSO\ SXW LV ZKHWKHU IRU SXUSRVHV RI DOORFDWLQJ LWV ILQLWH UHVRXUFHV D VWDWH KDV D OHJLWLPDWH UHDVRQ WR GLIIHUHQWLDWH EHWZHHQ SHUVRQV ZKR DUH ODZIXOO\ ZLWKLQ WKH VWDWH DQG WKRVH ZKR DUH XQODZIXOO\ WKHUH 7KH GLVWLQFWLRQ WKH 6WDWH RI 7H[DV KDV GUDZQ f§ EDVHG QRW RQO\ XSRQ LWV RZQ OHJLWLPDWH LQWHUHVWV EXW RQ FODVVLILFDWLRQV HVWDEOLVKHG E\ WKH )HGHUDO *RYHUQPHQW LQ LWV LPPLJUDWLRQ ODZV DQG SROLFLHV f§ LV QRW XQFRQVWLWXWLRQDO $ 7KH &RXUW DFNQRZOHGJHV WKDW H[FHSW LQ WKRVH FDVHV ZKHQ VWDWH FODVVLILFDWLRQV GLVDGYDQWDJH D fVXVSHFW FODVVf RU LPSLQJH XSRQ D fIXQGDPHQWDO ULJKWf WKH (TXDO 3URWHFWLRQ &ODXVH SHUPLWV D VWDWH fVXEVWDQWLDO ODWLWXGHf LQ GLVWLQJXLVKLQJ EHWZHHQ GLIIHUHQW JURXSV RI SHUVRQV 0RUHRYHU WKH &RXUW H[SUHVVO\ DQG FRUUHFWO\ UHMHFWV DQ\ VXJJHVWLRQ WKDW LOOHJDO DOLHQV DUH D VXVSHFW FODVV RU WKDW HGXFDWLRQ LV D IXQGDPHQWDO ULJKW 86 @ ,ELG S Q ,ELG S

PAGE 196

HGXFDWLRQ ,I HYHU D FRXUW ZDV JXLOW\ RI DQ XQDEDVKHGO\ UHVXOWRULHQWHG DSSURDFK WKLV FDVH LV D SULPH H[DPSOH f 7KH &RXUW ILUVW VXJJHVWV WKDW WKHVH LOOHJDO DOLHQ FKLOGUHQ DOWKRXJK QRW D VXVSHFW FODVV DUH HQWLWOHG WR VSHFLDO VROLFLWXGH XQGHU WKH (TXDO 3URWHFWLRQ &ODXVH EHFDXVH WKH\ ODFN fFRQWUROf RYHU RU fUHVSRQVLELOLW\f IRU WKHLU XQODZIXO HQWU\ LQWR WKLV FRXQWU\ 6LPLODUO\ WKH &RXUW DSSHDUV WR WDNH WKH SRVLWLRQ WKDW LV SUHVXPSWLYHO\ fLUUDWLRQDOf EHFDXVH LW KDV WKH HIIHFW RI LPSRVLQJ fSHQDOWLHVf > 86 @ RQ fLQQRFHQWf FKLOGUHQ +RZHYHU WKH (TXDO 3URWHFWLRQ &ODXVH GRHV QRW SUHFOXGH OHJLVODWRUV IURP FODVVLI\LQJ DPRQJ SHUVRQV RQ WKH EDVLV RI IDFWRUV DQG FKDUDFWHULVWLFV RYHU ZKLFK LQGLYLGXDOV PD\ EH VDLG WR ODFN fFRQWUROf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f

PAGE 197

KRVWLOLW\ LW LV QRW DQ DOOHQFRPSDVVLQJ fHTXDOL]HUf GHVLJQHG WR HUDGLFDWH HYHU\ GLVWLQFWLRQ IRU ZKLFK SHUVRQV DUH QRW fUHVSRQVLEOHf > 86 @ 7KH &RXUW GRHV QRW SUHVXPH WR VXJJHVW WKDW DSSHOOHHVn SXUSRUWHG ODFN RI FXOSDELOLW\ IRU WKHLU LOOHJDO VWDWXV SUHYHQWV WKHP IURP EHLQJ GHSRUWHG RU RWKHUZLVH SHQDOL]HG XQGHU IHGHUDO ODZ
PAGE 198

RQH WKHUH FDQ RI FRXUVH EH QR SUHVXPSWLRQ WKDW D VWDWH KDV D FRQVWLWXWLRQDO GXW\ WR LQFOXGH LOOHJDO DOLHQV DPRQJ WKH UHFLSLHQWV RI LWV JRYHUQPHQWDO EHQHILWV > 86 @ 7KH VHFRQG VWUDQG RI WKH &RXUWfV DQDO\VLV UHVWV RQ WKH SUHPLVH WKDW DOWKRXJK SXEOLF HGXFDWLRQ LV QRW D FRQVWLWXWLRQDOO\ JXDUDQWHHG ULJKW fQHLWKHU LV LW PHUHO\ VRPH JRYHUQPHQWDO fEHQHILWf LQGLVWLQJXLVKDEOH IURP RWKHU IRUPV RI VRFLDO ZHOIDUH OHJLVODWLRQf :KDWHYHU PHDQLQJ RU UHOHYDQFH WKLV RSDTXH REVHUYDWLRQ PLJKW KDYH LQ VRPH RWKHU FRQWH[W LW VLPSO\ KDV QR EHDULQJ RQ WKH LVVXHV DW KDQG ,QGHHG LW LV QHYHU PDGH FOHDU ZKDW WKH &RXUWnV RSLQLRQ PHDQV RQ WKLV VFRUH 7KH LPSRUWDQFH RI HGXFDWLRQ LV EH\RQG GLVSXWH 86 @ LQ WKLV FRQWH[W ,V WKH &RXUW VXJJHVWLQJ WKDW HGXFDWLRQ LV PRUH fIXQGDPHQWDOf WKDQ IRRG VKHOWHU RU PHGLFDO FDUH" >7KH 'HSDUWPHQW RI -XVWLFH UHFHQWO\ HVWLPDWHG WKH QXPEHU RI LOOHJDO DOLHQV ZLWKLQ WKH 8QLWHG 6WDWHV DW EHWZHHQ DQG PLOOLRQ -RLQW +HDULQJ EHIRUH WKH 6XEFRPPLWWHH RQ ,PPLJUDWLRQ 5HIXJHHV DQG ,QWHUQDWLRQDO /DZ RI WKH +RXVH &RPPLWWHH RQ WKH -XGLFLDU\ DQG WKH 6XEFRPPLWWHH RQ ,PPLJUDWLRQ DQG 5HIXJHH 3ROLF\ RI WKH 6HQDWH &RPPLWWHH RQ WKH -XGLFLDU\ WK &RQJ VW 6HVV f WHVWLPRQ\ RI $WWRUQH\ *HQHUDO 6PLWKf 2WKHU HVWLPDWHV UXQ DV KLJK DV PLOOLRQ 6HH 6WURXW &ORVLQJ WKH 'RRU RQ ,PPLJUDWLRQ &KULVWLDQ 6FLHQFH 0RQLWRU 0D\ S FRO @ ,ELG S 6DQ $QWRQLR ,QGHSHQGHQW 6FKRRO 'LVWULFW Y 5RGULJXH] 86 f /LQGVH\ Y 1RUPHW 86 f

PAGE 199

7KH (TXDO 3URWHFWLRQ &ODXVH JXDUDQWHHV VLPLODU WUHDWPHQW RI VLPLODUO\ VLWXDWHG SHUVRQV EXW LW GRHV QRW PDQGDWH D FRQVWLWXWLRQDO KLHUDUFK\ RI JRYHUQPHQWDO VHUYLFHV -867,&( 32:(// VSHDNLQJ IRU WKH &RXUW LQ 6DQ $QWRQLR ,QGHSHQGHQW 6FKRRO 'LVWULFW SXW LW ZHOO LQ VWDWLQJ WKDW WR WKH H[WHQW WKLV &RXUW UDLVHV RU ORZHUV WKH GHJUHH RI fMXGLFLDO VFUXWLQ\f LQ HTXDO SURWHFWLRQ FDVHV DFFRUGLQJ WR D WUDQVLHQW &RXUW PDMRULW\nV YLHZ RI WKH VRFLHWDO LPSRUWDQFH RI WKH LQWHUHVW DIIHFWHG ZH fDVVXPH D OHJLVODWLYH UROH DQG RQH IRU ZKLFK WKH &RXUW ODFNV ERWK DXWKRULW\ DQG FRPSHWHQFHf 7KH &RXUW LPSOLHV IRU H[DPSOH WKDW WKH )RXUWHHQWK $PHQGPHQW ZRXOG QRW UHTXLUH D VWDWH WR SURYLGH ZHOIDUH EHQHILWV WR LOOHJDO DOLHQV@ 6KDSLUR Y 7KRPSVRQ 86 f +DUODQ GLVVHQWLQJf 6DQ $QWRQLR ,QGHSHQGHQW 6FKRRO 'LVWULFW SS >%RWK WKH RSLQLRQ RI WKH &RXUW DQG -867,&( 32:(//nV FRQFXUUHQFH LPSO\ WKDW DSSHOOHHV DUH EHLQJ fSHQDOL]HGf EHFDXVH WKHLU SDUHQWV DUH LOOHJDO HQWUDQWV ,ELG S S Q 32:(// FRQFXUULQJf +RZHYHU 7H[DV KDV FODVVLILHG DSSHOOHHV RQ WKH EDVLV RI WKHLU RZQ LOOHJDO VWDWXV QRW WKDW RI WKHLU SDUHQWV &KLOGUHQ ERUQ LQ WKLV FRXQWU\ WR LOOHJDO DOLHQ SDUHQWV LQFOXGLQJ VRPH RI DSSHOOHHVf VLEOLQJV DUH QRW H[FOXGHG IURP WKH 7H[DV VFKRROV 1RU GRHV 7H[DV GLVFULPLQDWH DJDLQVW DSSHOOHHV EHFDXVH RI WKHLU 0H[LFDQ RULJLQ RU FLWL]HQVKLS 7H[DV SURYLGHV D IUHH SXEOLF HGXFDWLRQ WR FRXQWOHVV WKRXVDQGV RI 0H[LFDQ LPPLJUDQWV ZKR DUH ODZIXOO\ LQ WKLV FRXQWU\@

PAGE 200

2QFH LW LV FRQFHGHG DV WKH &RXUW GRHV f§ WKDW LOOHJDO DOLHQV DUH QRW D VXVSHFW FODVV DQG WKDW HGXFDWLRQ LV QRW D IXQGDPHQWDO ULJKW RXU LQTXLU\ VKRXOG IRFXV RQ DQG EH OLPLWHG WR ZKHWKHU WKH OHJLVODWLYH FODVVLILFDWLRQ DW LVVXH EHDUV D UDWLRQDO UHODWLRQVKLS WR D OHJLWLPDWH VWDWH SXUSRVH > 86 @ 7KH 6WDWH FRQWHQGV SULPDULO\ WKDW VHUYHV WR SUHYHQW XQGXH GHSOHWLRQ RI LWV OLPLWHG UHYHQXHV DYDLODEOH IRU HGXFDWLRQ DQG WR SUHVHUYH WKH ILVFDO LQWHJULW\ RI WKH 6WDWHnV VFKRROILQDQFLQJ V\VWHP DJDLQVW DQ HYHULQFUHDVLQJ IORRG RI LOOHJDO DOLHQV f§ DOLHQV RYHU ZKRVH HQWU\ RU FRQWLQXHG SUHVHQFH LW KDV QR FRQWURO 2I FRXUVH VXFK ILVFDO FRQFHUQV DORQH FRXOG QRW MXVWLI\ GLVFULPLQDWLRQ DJDLQVW D VXVSHFW FODVV RU DQ DUELWUDU\ DQG LUUDWLRQDO GHQLDO RI EHQHILWV WR D SDUWLFXODU JURXS RI SHUVRQV 86 @ 9DQFH Y %UDGOH\ 86 f 'DQGULGJH Y :LOOLDPV 86 f S -HIIHUVRQ Y +DFNQH\ 86 'DQGULGJH Y :LOOLDPV S >$SSHOOHHV fODFN FRQWUROf RYHU WKHLU LOOHJDO UHVLGHQFH LQ WKLV FRXQWU\ LQ WKH VDPH VHQVH DV ODZIXOO\ UHVLGHQW FKLOGUHQ ODFN FRQWURO RYHU WKH VFKRRO GLVWULFW LQ ZKLFK WKHLU SDUHQWV UHVLGH 7KH 7H[DV ODZ PLJKW DOVR EH MXVWLILHG DV D PHDQV RI GHWHUULQJ XQODZIXO LPPLJUDWLRQ :KLOH UHJXODWLRQ RI LPPLJUDWLRQ LV DQ H[FOXVLYHO\ IHGHUDO IXQFWLRQ D VWDWH PD\ WDNH VWHSV FRQVLVWHQW ZLWK IHGHUDO

PAGE 201

:LWKRXW ODERULQJ ZKDW ZLOO XQGRXEWHGO\ VHHP REYLRXV WR PDQ\ LW VLPSO\ LV QRW fLUUDWLRQDOf IRU D VWDWH WR FRQFOXGH WKDW LW GRHV QRW KDYH WKH VDPH UHVSRQVLELOLW\ WR SURYLGH EHQHILWV IRU SHUVRQV ZKRVH YHU\ SUHVHQFH LQ WKH VWDWH DQG WKLV FRXQWU\ LV LOOHJDO DV LW GRHV WR SURYLGH IRU SHUVRQV ODZIXOO\ SUHVHQW %\ GHILQLWLRQ LOOHJDO DOLHQV KDYH QR ULJKW ZKDWHYHU WR EH KHUH DQG WKH VWDWH PD\ UHDVRQDEO\ DQG FRQVWLWXWLRQDOO\ HOHFW QRW WR SURYLGH WKHP ZLWK JRYHUQPHQWDO VHUYLFHV DW WKH H[SHQVH RI WKRVH ZKR DUH ODZIXOO\ LQ WKH VWDWH ,Q 'H &DQDV Y %LFD[\f ZH KHOG WKDW D 6WDWH PD\ SURWHFW LWV ILVFDO LQWHUHVWV DQG ODZIXOO\ UHVLGHQW ODERU IRUFH IURP WKH GHOHWHULRXV HIIHFWV RQ LWV HFRQRP\ UHVXOWLQJ IURP WKH HPSOR\PHQW RI LOOHJDO DOLHQV $QG RQO\ UHFHQWO\ WKLV &RXUW PDGH FOHDU WKDW D 6WDWH KDV D OHJLWLPDWH LQWHUHVW LQ SURWHFWLQJ DQG SUHVHUYLQJ WKH TXDOLW\ RI LWV VFKRROV DQG fWKH ULJKW RI LWV RZQ ERQD ILGH UHVLGHQWV WR DWWHQG VXFK LQVWLWXWLRQV RQ D SUHIHUHQWLDO WXLWLRQ LPPLJUDWLRQ SROLF\ WR SURWHFW LWV HFRQRP\ DQG DELOLW\ WR SURYLGH JRYHUQPHQWDO VHUYLFHV IURP WKH fGHOHWHULRXV HIIHFWVf RI D PDVVLYH LQIOX[ RI LOOHJDO LPPLJUDQWV 'H &DQDV Y %LFD 86 f S Q 7KH &RXUW PDLQWDLQV WKDW GHQ\LQJ LOOHJDO DOLHQV D IUHH SXEOLF HGXFDWLRQ LV DQ LQHIIHFWXDO PHDQV RI GHWHUULQJ XQODZIXO LPPLJUDWLRQ DW OHDVW ZKHQ FRPSDUHG WR D SURKLELWLRQ DJDLQVW WKH HPSOR\PHQW RI LOOHJDO DOLHQV 3HUKDSV WKDW LV FRUUHFW EXW LW LV QRW GLVSRVLWLYH WKH (TXDO 3URWHFWLRQ &ODXVH GRHV QRW PDQGDWH WKDW D VWDWH FKRRVH HLWKHU WKH PRVW HIIHFWLYH DQG DOOHQFRPSDVVLQJ PHDQV RI DGGUHVVLQJ D SUREOHP RU QRQH DW DOO 'DQGULGJH Y :LOLDPV 86 f 7H[DV PLJKW UDWLRQDOO\ FRQFOXGH WKDW PRUH VLJQLILFDQW fGHPRJUDSKLF RU HFRQRPLF SUREOHP>V@f S DUH HQJHQGHUHG E\ WKH LOOHJDO HQWU\ LQWR WKH 6WDWH RI HQWLUH IDPLOLHV RI DOLHQV IRU LQGHILQLWH SHULRGV WKDQ E\ WKH SHULRGLF VRMRXUQV RI VLQJOH DGXOWV ZKR LQWHQG WR OHDYH WKH 6WDWH DIWHU VKRUWWHUP RU VHDVRQDO HPSOR\PHQW ,W EOLQNV UHDOLW\ WR PDLQWDLQ WKDW WKH DYDLODELOLW\ RI JRYHUQPHQWDO VHUYLFHV VXFK DV HGXFDWLRQ SOD\V QR UROH LQ DQ DOLHQ IDPLO\nV GHFLVLRQ WR HQWHU RU UHPDLQ LQ WKLV FRXQWU\ FHUWDLQO\ WKH DYDLODELOLW\ RI D IUHH ELOLQJXDO SXEOLF HGXFDWLRQ PLJKW ZHOO LQIOXHQFH DQ DOLHQ WR EULQJ KLV FKLOGUHQ UDWKHU WKDQ WUDYHO DORQH IRU EHWWHU MRE RSSRUWXQLWLHV@ >7KH &RXUW VXJJHVWV WKDW WKH 6WDWHnV FODVVLILFDWLRQ LV LPSURSHU EHFDXVH f>D@Q LOOHJDO HQWUDQW PLJKW EH JUDQWHG IHGHUDO SHUPLVVLRQ WR FRQWLQXH WR UHVLGH LQ WKLV FRXQWU\ RU HYHQ WR EHFRPH D FLWL]HQf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nV DVVHUWLRQ WKDW WKH 7H[DV VWDWXWH ZLOO EH DSSOLHG WR DOLHQV fZKR PD\ ZHOO EH HQWLWOHG WR UHPDLQ LQ WKH 8QLWHG 6WDWHVf S FRQFXUULQJ RSLQLRQf LV ZKROO\ ZLWKRXW IRXQGDWLRQ@ 86 f

PAGE 202

EDVLVf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nV XVH RI WKH VDPH FODVVLILFDWLRQ IRU FRPSDUDEOH SXUSRVHV DW WKH YHU\ OHDVW WKH\ WHQG WR VXSSRUW WKH UDWLRQDOLW\ RI 9ODQGLV Y .OLQH 86 f HPSKDVLV DGGHGf 6HH DOVR (ONLQV Y 0RUHQR 86 f >7KH &RXUWnV RSLQLRQ LV GLVLQJHQXRXV ZKHQ LW VXJJHVWV WKDW WKH 6WDWH KDV PHUHO\ SLFNHG D fGLVIDYRUHG JURXSf DQG DUELWUDULO\ GHILQHG LWV PHPEHUV DV QRQUHVLGHQWV S Q $SSHOOHHVf fGLVIDYRUHG VWDWXVf VWHPV IURP WKH YHU\ IDFW WKDW IHGHUDO ODZ H[SOLFLWO\ SURKLELWV WKHP IURP EHLQJ LQ WKLV FRXQWU\ 0RUHRYHU WKH DQDORJLHV WR 9LUJLQLDQV RU OHJDOO\ DGPLWWHG 0H[LFDQ FLWL]HQV HQWHULQJ 7H[DV ,ELG DUH VSXULRXV $ 9LUJLQLDQnV ULJKW WR PLJUDWH WR 7H[DV ZLWKRXW SHQDOW\ LV SURWHFWHG E\ WKH &RQVWLWXWLRQ VHH HJ 6KDSLUR Y 7KRPSVRQ 86 f DQG D ODZIXOO\ DGPLWWHG DOLHQnV ULJKW WR HQWHU WKH 6WDWH LV OLNHZLVH SURWHFWHG E\ IHGHUDO ODZ 6HH 7DNDKDVKL Y )LVK t *DPH &RPPLVVLRQ 86 f &I =REHO Y :LOOLDPV@ 86& If HG DQG 6XSS ,9f DQG &)5 f &)5 f 86&  DQG &)5 Ef f 86& R DQG &)5 Dff f >,W LV WUXH WKDW WKH &RQVWLWXWLRQ LPSRVHV OHVVHU FRQVWUDLQWV RQ WKH )HGHUDO *RYHUQPHQW WKDQ RQ WKH VWDWHV ZLWK UHJDUG WR GLVFULPLQDWLRQ DJDLQVW ODZIXOO\ DGPLWWHG DOLHQV (J 0DWKHZV Y 'LD] 86 f +DPSWRQ Y 0RZ 6XQ :RQJ 86 f 7KLV LV EHFDXVH f&RQJUHVV DQG WKH 3UHVLGHQW KDYH EURDG SRZHU RYHU LPPLJUDWLRQ DQG QDWXUDOL]DWLRQ ZKLFK WKH 6WDWHV GR QRW SRVVHVVf +DPSWRQ S DQG EHFDXVH VWDWH GLVFULPLQDWLRQ DJDLQVW OHJDOO\ UHVLGHQW DOLHQV FRQIOLFWV ZLWK DQG DOWHUV WKH FRQGLWLRQV ODZIXOO\ LPSRVHG E\ &RQJUHVV XSRQ DGPLVVLRQ QDWXUDOL]DWLRQ DQG UHVLGHQFH RI DOLHQV LQ WKH 8QLWHG 6WDWHV RU WKH VHYHUDO VWDWHV 7DNDKDVKL Y )LVK t *DPH &RPPLVVLRQ 86 f +RZHYHU WKH VDPH FDQQRW EH VDLG ZKHQ &RQJUHVV KDV GHFUHHG WKDW FHUWDLQ DOLHQV VKRXOG QRW EH DGPLWWHG WR WKH 8QLWHG 6WDWHV DW DOO@

PAGE 203

H[FOXGLQJ LOOHJDO DOLHQ UHVLGHQWV RI D VWDWH IURP VXFK SURJUDPV VR DV WR SUHVHUYH WKH VWDWHfV ILQLWH UHYHQXHV IRU WKH EHQHILW RI ODZIXO UHVLGHQWV 7KH &RXUW PDLQWDLQV f§ DV LI WKLV ZHUH WKH LVVXH f§ WKDW EDUULQJ XQGRFXPHQWHG FKLOGUHQ IURP ORFDO VFKRROV ZRXOG QRW QHFHVVDULO\ LPSURYH WKH TXDOLW\ RI HGXFDWLRQ SURYLGHG LQ WKRVH > 86 @ VFKRROV +RZHYHU WKH OHJLWLPDF\ RI EDUULQJ LOOHJDO DOLHQV IURP SURJUDPV VXFK DV 0HGLFDUH RU 0HGLFDLG GRHV QRW GHSHQG RQ D VKRZLQJ WKDW WKH EDUULHU ZRXOG fLPSURYH WKH TXDOLW\f RI PHGLFDO FDUH JLYHQ WR SHUVRQV ODZIXOO\ HQWLWOHG WR SDUWLFLSDWH LQ VXFK SURJUDPV 0RGHP HGXFDWLRQ OLNH PHGLFDO FDUH LV HQRUPRXVO\ H[SHQVLYH DQG WKHUH FDQ EH QR GRXEW WKDW YHU\ ODUJH DGGHG FRVWV ZLOO IDOO RQ WKH 6WDWH RU LWV ORFDO VFKRRO GLVWULFWV DV D UHVXOW RI WKH LQFOXVLRQ RI LOOHJDO DOLHQV LQ WKH WXLWLRQIUHH SXEOLF VFKRROV 7KH 6WDWH PD\ LQ LWV GLVFUHWLRQ XVH DQ\ VDYLQJV UHVXOWLQJ IURP LWV WXLWLRQ UHTXLUHPHQW WR fLPSURYH WKH TXDOLW\ RI HGXFDWLRQ LQ WKH SXEOLF VFKRRO V\VWHP RU WR HQKDQFH WKH IXQGV DYDLODEOH IRU RWKHU VRFLDO SURJUDPV RU WR UHGXFH WKH WD[ EXUGHQ SODFHG RQ LWV UHVLGHQWV HDFK RI WKHVH HQGV LV fOHJLWLPDWHff 7KH 6WDWH QHHG QRW VKRZ DV WKH &RXUW LPSOLHV WKDW WKH LQFUHPHQWDO FRVW RI HGXFDWLQJ LOOHJDO DOLHQV ZLOO VHQG LW LQWR EDQNUXSWF\ RU KDYH D ffUDYH LPSDFW RQ WKH TXDOLW\ RI HGXFDWLRQff WKDW LV QRW GLVSRVLWLYH XQGHU D fUDWLRQDO EDVLVf VFUXWLQ\ ,Q WKH DEVHQFH RI D FRQVWLWXWLRQDO LPSHUDWLYH WR SURYLGH IRU WKH HGXFDWLRQ RI LOOHJDO DOLHQV WKH 6WDWH PD\ fUDWLRQDOO\f FKRRVH WR WDNH 0DWKHZV Y 'LD] 86 S VHH DOVR Q ,ELG S )6XSS (' 7H[ f >7KH 'LVWULFW &RXUW VR FRQFOXGHG SULPDULO\ EHFDXVH WKH 6WDWH ZRXOG GHFUHDVH LWV IXQGLQJ WR ORFDO VFKRRO GLVWULFWV LQ SURSRUWLRQ WR WKH H[FOXVLRQ RI LOOHJDO DOLHQ FKLOGUHQ )6XSS S @ >7KLV fUDWLRQDO EDVLV VWDQGDUGf ZDV DSSOLHG E\ WKH &RXUW RI $SSHDOV )G f@

PAGE 204

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n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fV FDVHV UHJUHW WR VD\ SUHVHQW \HW DQRWKHU H[DPSOH RI XQZDUUDQWHG MXGLFLDO DFWLRQ ZKLFK LQ WKH ORQJ UXQ WHQGV WR FRQWULEXWH WR WKH ZHDNHQLQJ RI RXU SROLWLFDO SURFHVVHV >, DVVXPH QR 0HPEHU RI WKH &RXUW ZRXOG FKDOOHQJH 7H[DVn ULJKW WR FKDUJH WXLWLRQ WR VWXGHQWV UHVLGLQJ DFURVV WKH ERUGHU LQ /RXLVLDQD ZKR VHHN WR DWWHQG WKH QHDUHVW VFKRRO LQ 7H[DV@ >,Q VXSSRUW RI WKLV FRQFOXVLRQ WKH &RXUWnV RSLQLRQ VWULQJV WRJHWKHU TXRWDWLRQV GUDZQ IURP FDVHV DGGUHVVLQJ VXFK GLYHUVH PDWWHUV DV WKH ULJKW RI LQGLYLGXDOV XQGHU WKH 'XH 3URFHVV &ODXVH WR OHDUQ D IRUHLJQ ODQJXDJH 0H\HU Y 1HEUDVND 86 f WKH )LUVW $PHQGPHQW SURKLELWLRQ DJDLQVW VWDWH PDQGDWHG UHOLJLRXV H[HUFLVHV LQ WKH SXEOLF VFKRROV $ELQJWRQ 6FKRRO 'LVWULFW Y 6FKHPSS 86 f DQG VWDWH LPSLQJHPHQWV XSRQ WKH IUHH H[HUFLVH RI UHOLJLRQ :LVFRQVLQ Y 3URIHVVRU %LFNHO QRWHG WKDW MXGLFLDO UHYLHZ FDQ KDYH D fWHQGHQF\ RYHU WLPH VHULRXVO\ WR ZHDNHQ WKH GHPRFUDWLF SURFHVVf $ %LFNHO 7KH /HDVW 'DQJHURXV %UDQFK f +H UHLWHUDWHG -DPHV %UDGOH\

PAGE 205

&RQJUHVV fYHVWHG E\ WKH &RQVWLWXWLRQ ZLWK WKH UHVSRQVLELOLW\ RI SURWHFWLQJ RXU ERUGHUV DQG OHJLVODWLQJ ZLWK UHVSHFW WR DOLHQVf EHDUV SULPDU\ UHVSRQVLELOLW\ IRU DGGUHVVLQJ WKH SUREOHPV RFFDVLRQHG E\ WKH PLOOLRQV RI LOOHJDO DOLHQV IORRGLQJ DFURVV RXU VRXWKHUQ ERUGHU 6LPLODUO\ LW LV IRU &RQJUHVV DQG QRW WKLV &RXUW WR > 86 @ DVVHVV WKH fVRFLDO FRVWV ERPH E\ RXU 1DWLRQ ZKHQ VHOHFW JURXSV DUH GHQLHG WKH PHDQV WR DEVRUE WKH YDOXHV DQG VNLOOV XSRQ ZKLFK RXU VRFLDO RUGHU UHVWVf :KLOH WKH fVSHFWHU RI D SHUPDQHQW FDVWHf RI LOOHJDO 0H[LFDQ UHVLGHQWV RI WKH 8QLWHG 6WDWHV LV LQGHHG D GLVWXUELQJ RQH LW LV EXW RQH VHJPHQW RI D ODUJHU SUREOHP ZKLFK LV IRU WKH SROLWLFDO EUDQFKHV WR VROYH ILQG LW GLIILFXOW WR EHOLHYH WKDW &RQJUHVV ZRXOG ORQJ WROHUDWH VXFK D VHOIGHVWUXFWLYH UHVXOW f§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f ,ELG S TXRWLQJ 7KD\HU -RKQ 0DUVKDOO f@ ,ELG S 32:(// FRQFXUULQJf ,ELG S

PAGE 206

/,67 2) 5()(5(1&(6 $OH[DQGHU .HUQ DQG $OH[DQGHU 0 'DYLG $PHULFDQ 3XEOLF 6FKRRO /DZ 1HZ
PAGE 207

&DOYR -DQHW 0 f$OLHQ 6WDWXV 5HVWULFWLRQV RQ (OLJLELOLW\ IRU )HGHUDOO\ )XQGHG $VVLVWDQFH 3URJUDPVf 1HZ
PAGE 208

)ORULGD 'HSDUWPHQW 2I (GXFDWLRQ (QUROOPHQW RI )RUHLJQERP DQG /(3 6WXGHQWV 0HPRUDQGXP -XQH )ORULGD 'HSDUWPHQW RI (GXFDWLRQ )ORULGD 6FKRRO /DZV &KDSWHU )ORULGD 6WDWXWHV )ORULGD 'HSDUWPHQW RI (GXFDWLRQ 2IILFH RI 2UJDQL]DWLRQDO DQG (PSOR\HH 'HYHORSPHQW f )ORULGD 'HSDUWPHQW RI (GXFDWLRQ 3URILOHV RI 6FKRRO 'LVWULFW 7RWDOV )HEUXDU\ f )ORULGD 'HSDUWPHQW RI (GXFDWLRQ Df /HDJXH RI 8QLWHG /DWLQ $PHULFDQ &LWL]HQV /8/$&f HW DO Y 6WDWH %RDUG RI (GXFDWLRQ &RQVHQW 'HFUHH 7DOODKDVVHH )/ 2IILFH RI 0XOWLFXOWXUDO 6WXGHQW /DQJXDJH (GXFDWLRQ )ORULGD 'HSDUWPHQW RI (GXFDWLRQ Ef DQQXDO VWDWXV UHSRUW RQ WKH LPSOHPHQWDWLRQ RI WKH /HDJXH RI 8QLWHG /DWLQ $PHULFDQ &LWL]HQV /8/$&f HW DO Y 6WDWH %RDUG RI (GXFDWLRQ &RQVHQW 'HFUHH 7DOODKDVVHH )/ 2IILFH RI 0XOWLFXOWXUDO 6WXGHQW /DQJXDJH (GXFDWLRQ )ORULGD *RYHUQRUfV 2IILFH f7KH 8QIDLU %XUGHQ 7DOODKDVVHH )/ 0DUFK )ORULGD 0DQDJHPHQW (GXFDWLRQ 6HUYLFHV &XUUHQW \HDU VWXGHQW GDWD E\ GLVWULFW 7DOODKDVVHH )/ )ORULGD 'HSDUWPHQW RI (GXFDWLRQ f )ORULGD :RQfW %H &RPSHQVDWHG )RU ,OOHJDO ,PPLJUDWLRQ )ORULGD ,OOHJDO ,PPLJUDWLRQ 'HFHPEHU )ORULGD 6RFLDO 3ROLF\ ,VVXHV f,PPLJUDWLRQ DQG )ORULGD 6RFLDO 3ROLF\ ,VVXHV 7DOODKDVVHH )/ )ORULGD 'HSDUWPHQW RI (GXFDWLRQ f )UDGG 6DQGUD + DQG /HH 2NKHH HGV &UHDWLQJ )ORULGDnV 0XOWLOLQJXDO :RUNIRUFH 0LDPL &XVWRP &RS\ DQG 3ULQWLQJ *LPSHO -DPHV DQG (GZDUGV -U -DPHV 5 f 7KH &RQJUHVVLRQDO 3ROLWLFV RI ,PPLJUDWLRQ 5HIRUP 1HHGKDP +HLJKWV 0$ $OO\Q t %DFRQ *OD]HU 1DWKDQ HG &ODPRU $W 7KH *DWHV 7KH 1HZ $PHULFDQ ,PPLJUDWLRQ SS ,&6 3UHVV 6DQ )UDQFLVFR f *UHHQH -RVHSK )7( $GPLQLVWUDWRU 6HPLQROH &RXQW\ 3XEOLF 6FKRROV 6DQIRUG )ORULGD f *XWKULH -DPHV : 6FKRRO )LQDQFH 3ROLFLHV DQG 3UDFWLFHV WKH V $ 'HFDGH RI &RQIOLFW %DOOLQJHU &DPEULGJH 0$ f

PAGE 209

+LFNPDQ /DUU\ $ DQG $OH[DQGHU 7KRPDV 0 7KH (VVHQWLDO 'HZH\ ,QGLDQD 8QLYHUVLW\ 3UHVV %ORRPLQJWRQ ,QG f +LJKDP -RKQ 6WUDQJHUV LQ WKH /DQG 3DWWHUQV RI $PHULFDQ 1DWLYLVP S f +LQJ %LOO 2QJ 0DNLQJ DQG 5HPDNLQJ $VLD $PHULFD WKURXJK ,PPLJUDWLRQ 3ROLF\ f +XGGOH 'RQDOG f7KH 1HW 1DWLRQDO &RVWV RI ,PPLJUDWLRQ LQ -XQH ,OOHJDO ,PPLJUDQW &KLOGUHQ ,Q RU 2XW RI 3XEOLF 6FKRROV" (GXFDWLRQ :HHN $SULO ,PPLJUDQW &KLOGUHQ DQG 7KHLU )DPLOLHV ,VVXHV IRU 5HVHDUFK DQG 3ROLF\ 7KH )XWXUH RI &KLOGUHQ 9RO 1R 6XPPHU)DOO ,PPLJUDQWV DQG (GXFDWLRQ )$,5 0D\ ,PPLJUDWLRQ 3ROLF\ YHUVXV ,PPLJUDQW 3ROLF\ )$,5 2FWREHU ZZZIDLUXVRUJKWLQ! ,QLWLDWLYH RQ $OLHQV 6XIIHUV ,WV %LJJHVW 6HWEDFN
PAGE 210

0F'DQLHOV &\QWKLD f(TXDOLW\ RI (GXFDWLRQDO 2SSRUWXQLW\ 5DFH DQG )LQDQFH LQ 3XEOLF (GXFDWLRQf 7KH &RQVWLWXWLRQ &RXUWV DQG 3XEOLF 6FKRROV 9ROO
PAGE 211

&KDUDFWHULVWLFV DQG 3HUIRUPDQFH RI +LJK 6FKRRO 6WXGHQWV LQ 'DGH &RXQW\ 0LDPLf 6FKRROV &'6 5HSRUW 1R $XJXVW f 5XPEDXW 5XEHQ 2ULJLQV DQG GHVWLQLHV ,PPLJUDWLRQ WR WKH 8QLWHG 6WDWHV 6LQFH :RUOG :DU ,, 6RFLRORJLFDO )RUXP SS 'HFHPEHU f 5XVVR &KDUOHV /HJDO 5HVHDUFK 7KH f7UDGLWLRQDOff 0HWKRG 12/3( 1RWHV 2FWREHU f 6FKOHVVLQJHU -U $UWKXU 0 7KH 'LVXQLWLQJ RI $PHULFDf f 6FKXFN 3HWHU + 7KH 0HDQLQJ RI )DFLQJ 8S WR ,OOHJDO ,PPLJUDWLRQ 7KH $PHULFDQ 3URVSHFW 1R 6SULQJ 6HUUDQR +RXVH RI 5HSUHVHQWDWLYHV WKRPDVORFJRYFJLELQTXHU\'"UOWHPS! 6LPRQ -XOLDQ ,PPLJUDWLRQ 7KH 'HPRJUDSKLFV DQG (FRQRPLF )DFWV :DVKLQJWRQ '& &DWR ,QVWLWXWH DQG 1DWLRQDO ,PPLJUDWLRQ )RUXP f 6WDFH\ 1 f6RFLDO %HQHILWV RI (GXFDWLRQf 7KH $QQXDOV RI WKH $PHULFDQ $FDGHP\ 6HSWHPEHU 6WHZDUW 'DYLG : ,PPLJUDWLRQ DQG (GXFDWLRQ 7KH &ULVLV DQG WKH 2SSRUWXQLWLHV 1HZ
PAGE 212

86 'HSDUWPHQW RI (GXFDWLRQ 7KH &RQGLWLRQ 2I %LOLQJXDO (GXFDWLRQ ,Q 7KH 1DWLRQ $ 5HSRUW 7R 7KH &RQJUHVV $QG 7KH 3UHVLGHQW :DVKLQJWRQ '& 86 +RXVH RI 5HSUHVHQWDWLYHV :D\V $QG 0HDQV &RPPLWWHH 3ULQW > *UHHQ %RRN@ $SSHQGL[ 1RQFLWL]HQV 86 +RXVH RI 5HSUHVHQWDWLYHV :D\V $QG 0HDQV &RPPLWWHH 3ULQW > *UHHQ %RRN@ 7KH 8QIDLU %XUGHQ ,PPLJUDWLRQfV ,PSDFW RQ )ORULGD )ORULGD *RYHUQRUfV 2IILFH 7DOODKDVVHH ), 0DUFK 9DLO .DWKOHHQ f1R (QWU\f 7KH $PHULFDQ 6FKRRO %RDUG -RXUQDO QR SS 6HSWHPEHU f 9DQ 'H 0DUN *UHJJ f7RR 0XFK RI D *RRG 7KLQJ :DVKEXUQ /DZ -RXUQDO QR 6SULQJ f KWWSZDVKEXPODZZXDFFHGXVFKRROSXEOLFWQVZOM! 9HPH] *HRUJH .URS 5LFKDUG DQG 5\GHO 3HWHU &ORVLQJ WKH (GXFDWLRQ *DS %HQHILWV DQG &RVWV 5$1' S f 9LDOHW -R\FH & DQG (LJ /DUU\ 0 ,PPLJUDWLRQ DQG )HGHUDO $VVLVWDQFH ,VVXHV DQG /HJLVODWLRQ &RQJUHVVLRQDO 5HVHDUFK 6HUYLFH ,VVXH %ULHI $SULO 9LOODUUHDO $EHODUGR DQG $GHOD 6ROLV (IIHFWLYH ,PSOHPHQWDWLRQ RI %LOLQJXDO 3URJUDPV 5HIOHFWLRQV IURP WKH )LHOG ('5$ 1HZVOHWWHU -DQXDU\ =LHJOHU %HQMDPLQ 0 HG ,PPLJUDWLRQ $Q $PHULFDQ 'LOHPPD f

PAGE 213

/(*$/ 5()(5(1&(6 86 & i 86 f 86&  DQG &)5 Ef f 86& i 8&/$ / 5HY &)5 f ) 6XSS &DO $SSK ) G 86& HG DQG 6XSS ,9f DQG &)5 f $ELQJWRQ 6FKRRO 'LVWULFW Y 6FKHPSS 86 f $FW RI -XO\ FK 6WDW $PEDFK Y 1RUZLFN 86 f %URZQ Y %RDUG RI (GXFDWLRQ 86 f &DOLIRUQLD &RQVWLWXWLRQ $UWLFOH 6HFDf &DVWDQHGD Y 3LFNDUG f ) G &DVWDQHGD ,,f &DVWDQHGD Y 3LFNDUG f )G &KLOHV Y 86

PAGE 214

&KLQHVH ([FOXVLRQ $FW FK 6WDW &LYLO 5LJKWV $FW RI 3XE / 1R 6WDW &21*5(66,21$/ 5(&25' SW S f &RQVHQW 'HFUHH >V Off )6@ 1RQUHVLGHQW 7XLWLRQ )HH &RQVHQW 'HFUHH >V OfIf )6@ &RPSXOVRU\ 6FKRRO $WWHQGDQFH 'H&DQDV Y %LFD 86 f (PHUJHQF\ (GXFDWLRQ $FW RI (PHUJHQF\ ,PPLJUDQW (GXFDWLRQ $FW (,($f 7LWOH ,9 3DUW RI WKH (OHPHQWDU\ DQG 6HFRQGDU\ (GXFDWLRQ $FWf DV DPHQGHG 86& f (TXDO (GXFDWLRQ 2SSRUWXQLWLHV $FW RI ((2$f DW 86& ([HF 2UGHU 1R &)5 f )ORULGD 6FKRRO /DZV &KDSWHUV )RJJ Y %RDUG RI (GXFDWLRQ 1+ $ f + 5 f *DOOHJO\ $PHQGPHQW *ROGEHUJ Y .HOO\ 86 f *RQ]DOHV Y &LW\ RI 3HRULD )G WK &LU f ,PPLJUDWLRQ 5HIRUP DQG &RQWURO $FW 3XE / 1R 6WDW f ,PPLJUDWLRQ $FW RI FK 6WDW f ,PPLJUDWLRQ $FW RI 3XE / 1R 6WDW f ,PPLJUDWLRQ $FW RI 3XE / 1R ii 6WDW f ,PPLJUDWLRQ $FW RI 3XE / 1R ii 6WDW f ,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW $PHQGPHQWV RI 2FWREHU 6WDW f ,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW ,1$f 3XEOLF /DZ >V Dff@ 86& >V Dff@ f

PAGE 215

,PPLJUDWLRQ DQG 1DWLRQDOLW\ $FW 3XEOLF /DZ f ,PPLJUDWLRQ 5HIRUP DQG &RQWURO $FW 3XE / 1R 6WDW f -HIIHUVRQ Y +DFNQH\ 86 f 5HHG Y 5HHG 86 f .H\HV Y 6FKRRO 'LVWULFW 1RO f ) 6XSS /DX Y 1LFKROV 86 f /HDJXH RI 8QLWHG /DWLQ $PHULFDQ &LWL]HQV /8/$&f HW DO Y WKH 6WDWH %RDUG RI (GXFDWLRQ HW DO &RQVHQW 'HFUHH 86 'LVWULFW &RXUW IRU WKH 6RXWKHUQ 'LVWULFW RI )ORULGD $XJXVW /HHSHU Y 6WDWH 7HQQ 6: f /LQGVH\ Y 1RUPHW 86 f 0DUWLQH] Y %\QXP 86 f 0DWKHZV Y 'LD] 86 f 0F&DUUDQ:DOWHU $FW FK 6WDW 86& i 0H\HU Y 6WDWH RI 1HEUDVND 86 f 1HZ Dff$f@ 6DQ $QWRQLR ,QGHSHQGHQW 6FKRRO 'LVWULFW Y 5RGULJXH] 86 f 6HUUDQR Y 3ULHVW &DOLIRUQLD 6XSUHPH &RXUW 7HUHVD 3 Y %HUNHOH\ 8QLILHG 6FKRRO 'LVWULFW f ) 6XSS

PAGE 216

7(;$6 ('8&$7,21 &2'( $11 i 9HUQRQ 6XSS f 7KH (PHUJHQF\ ,PPLJUDQW (GXFDWLRQ $FW (,($f 7LWOH ,9 SDUW RI WKH (OHPHQWDU\ DQG 6HFRQGDU\ (GXFDWLRQ $FW DV DPHQGHG 86& f 7LWOH 9, RI WKH &LYLO 5LJKWV $FW DW 86& i G 7ROO Y 0RUHQR 86 f 9$ Y +LOO 86 f 86 &HQVXV %XUHDX ,OOHJDO $OLHQ 5HVLGHQW 3RSXODWLRQ 86 &HQVXV 86 &RPPLVVLRQ RQ ,PPLJUDWLRQ 5HIRUP 86 ,PPLJUDWLRQ 3ROLF\ 5HVWRULQJ &UHGLELOLW\ f 86 &RQVWLWXWLRQ $UW 9, FO 86 &RQVWLWXWLRQ $UWLFOH 9, 86 +RXVH RI 5HSUHVHQWDWLYHV :D\V $QG 0HDQV &RPPLWWHH 3ULQW > *UHHQ %RRN@ $SSHQGL[ 1RQFLWL]HQV 7KH 3HUVRQDO 5HVSRQVLELOLW\ DQG :RUN 2SSRUWXQLW\ 5HFRQFLOLDWLRQ $FW DQG $VVRFLDWHG /HJLVODWLRQ 86 +RXVH RI 5HSUHVHQWDWLYHV :D\V $QG 0HDQV &RPPLWWHH 3ULQW > *UHHQ %RRN@ 9RWLQJ 5LJKWV $FW RI 3XE / 1R 6WDW :LVFRQVLQ Y
PAGE 217

%,2*5$3+,&$/ 6.(7&+ 5RVH $OYLQH 5DVND LV D SURGXFW RI )ORULGD VFKRROV EHJLQQLQJ ZLWK WKH ILUVW JUDGH 6KH JUDGXDWHG IURP 6RXWK 'DGH +LJK 6FKRRO LQ +RPHVWHDG )ORULGD LQ 6KH WKHQ HDUQHG D %DFKHORU RI $UWV DW WKH 8QLYHUVLW\ RI 6RXWK )ORULGD LQ +HU PDVWHUfV GHJUHH FDPH IURP WKH 8QLYHUVLW\ RI &HQWUDO )ORULGD DQG KHU HGXFDWLRQ VSHFLDOLVW GHJUHH IURP WKH 8QLYHUVLW\ RI )ORULGD 6KH LV HPSOR\HG E\ WKH 6HPLQROH &RXQW\ 3XEOLF 6FKRRO V\VWHP DV WKH VFKRROWR ZRUN FRRUGLQDWRU DQG WKH GLVWULFWfV JXLGDQFH DQG FDUHHU GHYHORSPHQW FRRUGLQDWRU UHSUHVHQWLQJ VHYHQ KLJK VFKRROV DQG VWXGHQWV 6KH LV DFWLYHO\ LQYROYHG LQ ZRUNIRUFH GHYHORSPHQW DQG VWULYHV IRU DOO VWXGHQWV WR OHDUQ DERXW WKH P\ULDG RI FDUHHU DQG HGXFDWLRQDO RSSRUWXQLWLHV DYDLODEOH WR WKHP 5RVH KDV ZRUNHG IXOOWLPH GXULQJ WKH SXUVXLW RI WKLV 'RFWRU RI 3KLORVRSK\ GHJUHH 5RVH WDXJKW HOHPHQWDU\ HGXFDWLRQ IRU WKUHH \HDUV DQG WKHQ EHJDQ \HDUV RI HGXFDWLRQDO FRXQVHOLQJ H[SHULHQFH PLGGOH VFKRRO KLJK VFKRRO DQG SRVWVHFRQGDU\f LQ WKH SXEOLF VFKRRO DUHQD +HU PRWKHU *HUPDLQH %RXUTXH 5DVND LQVSLUHG 5RVH WR EH D OLIHORQJ OHDUQHU 5RVH KDV ILYH EURWKHUV DQG VLVWHUV DOO RI ZKRP DUH FROOHJH HGXFDWHG 7ZR DUH FHUWLILHG SXEOLF DFFRXQWDQWV ZLWK GHJUHHV IURP )ORULGD VWDWH XQLYHUVLWLHV

PAGE 218

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

PAGE 219

7KLV GLVVHUWDWLRQ ZDV VXEPLWWHG WR WKH *UDGXDWH )DFXOW\ RI WKH &ROOHJH RI (GXFDWLRQ DQG WR WKH *UDGXDWH 6FKRRO DQG ZDV DFFHSWHG DV SDUWLDO IXOILOOPHQW RI WKH UHTXLUHPHQWV IRU WKH GHJUHH RI 'RFWRU RI 3KLORVRSK\ $XJXVW 'HDQ *UDGXDWH 6FKRRO

PAGE 220

/' 4- mHPD.9.VZZYr}} ZDQZ\DU Ac9(56_W\ 2) )/25,'$


52
mandate identical treatment of different categories of persons.94 The issue was whether,
for purposes of allocating resources, a state had a legitimate reason to differentiate
between persons who were lawfully within the state and those who were not.95
Therefore, the distinction drawn by Texas, based not on its own legitimate interests but
on the classifications by the Federal Governments immigration laws and policies, was
not unconstitutional.
The Court had recognized that, in allocating governmental benefits to a given
class of aliens, one may take into account the character of the relationship between the
alien and the country.96 When that relationship was a federally prohibited one, there
could be no presumption that a state had a constitutional duty to include illegal aliens
among the recipients of its governmental benefits.97
The Court held many times that the importance of a governmental service did not
elevate it to a fundamental right for purposes of equal protection analysis.98 In San
Antonio Independent School District, Justice Powell, speaking for the court, expressly
rejected the proposition that state laws dealing with public education were subject to
special scrutiny under the Equal Protection Clause. The Court further indicated there was
94 Jefferson v. Hackney, 406 U.S. 535, 549 (1972); Reed v. Reed, 404 U.S. 71, 75 (1971).
95 PlylerASl U.S. 224.
96 Mathews v. Diaz, 426 U.S. 67, 80 (1976).
97 Plyler, 457 U.S. 247
go
San Antonio Independent School Dist. v. Rodriguez, 411 U.S. 1, 301 (1973); Lindsey v. Normet, 405 U.S.
56, 73-74(1972).


179
by other benefits as well. This is a problem of serious national proportions, as the
Attorney General recently has recognized.116 Perhaps because of the intractability of the
problem, Congress vested by the Constitution with the responsibility of protecting our
borders and legislating with respect to aliens has not provided effective leadership in
dealing with this problem. It is certain that illegal aliens will continue to enter the United
States and, as the record makes clear, an unknown percentage of them will remain
here.117 1 agree with the Court that their children should not be left on the streets
uneducated.
Although the analogy is not perfect, our holding today does find support in
decisions of this Court with respect to the status of illegitimates. In Weber v. Aetna
Casualty & Surety Co.,118 we said: [V]isiting ... condemnation on the head of an
infant" for the misdeeds of the parents is illogical, unjust, and "contrary to the basic
concept of our system that legal burdens should bear some relationship to individual
responsibility or wrongdoing.
In these cases, the State of Texas effectively denies to the school-age children of
illegal aliens the opportunity to attend the free public schools that the State makes
available to all residents. They are excluded only because of a status resulting from the
violation by parents or guardians of our immigration laws and the fact that they remain in
116 Ibid., p. n. 17.
1,7 [457 U.S. 238]
118
406 U.S. 164, 175(1972).


161
Of course, undocumented status is not irrelevant to any proper legislative goal.
Nor is undocumented status an absolutely immutable characteristic, since it is the product
of conscious, indeed unlawful, action. But 21.031 is directed against children, and
imposes its discriminatory burden on the basis of a legal characteristic over which
children can have little control. It is thus difficult to conceive of a rational justification
for penalizing these children for their presence within the United States. Yet that appears
to be precisely the effect of 21.031. [457 U.S. 221]
Public education is not a right granted to individuals by the Constitution.45 But
neither is it merely some governmental benefit indistinguishable from other forms of
social welfare legislation. Both the importance of education in maintaining our basic
institutions and the lasting impact of its deprivation on the life of the child mark the
distinction. The American people have always regarded education and [the] acquisition
of knowledge as matters of supreme importance.46 We have recognized the public
schools as a most vital civic institution for the preservation of a democratic system of
government,47 and as the primary vehicle for transmitting the values on which our
society rests.48 [A]s ... pointed out early in our history,... some degree of education is
necessary to prepare citizens to participate effectively and intelligently in our open
political system if we are to preserve freedom and independence.49 And these historic
45 San Antonio Independent School District v. Rodriguez, 411 U.S. 1, 35 (1973).
46 Meyer v. Nebraska, 262 U.S. 390,400 (1923).
47 Abington School District v. Schempp, 374 U.S. 203, 230 (1963) (BRENNAN, J., concurring).
48 Ambach v. Norwick, 441 U.S. 68, 76 (1979).
49
Wisconsin v. Yoder, 406 U.S. 205, 221 (1972).


ACKNOWLEDGMENTS
Without the support and assistance of certain individuals this research would not
have been possible. I greatly appreciate the encouragement and guidance of my chair,
Dr. David S. Honeyman, who gave me the drive and tenacity to complete this project.
My appreciation again goes to Dr. M. David Miller, Dr. Walter L. Smith and Dr. Lee J.
Mullally, my supervisory committee members. I would also like to thank Dr. R. Craig
Wood.
Special thanks go to Bettie Hogle, Director of Applied Technology, Seminole
County Public Schools, for her counsel and support through out this project. I am
especially grateful to Dr. Michael James Murray, Winona State University, for his
encouragement and belief in my abilities.
Most importantly, I must acknowledge my deceased mother, Germaine B. Raska,
who knew that I could and would achieve this goal.
in



DEDICATED TO:
Germaine G. Bourque Raska (1915-1991), my most wonderful Mother,
without whose spirit, inspiration and belief in me,
I would not have attempted such a monumental task.
u


18
Historically, federal and state governments worked to keep students in school,
rather than out. But as part of the wave of anti-immigrant sentiment, several proposals
were made to bar undocumented immigrant students from attending public schools.
California's victorious 1994 ballot measure, Proposition 187, barred undocumented
students from the public schools.63
The Gallegly Amendment (1996)64 passed in the U.S. House of Representatives
as part of an immigration-reform bill and gave states the authority to limit access.
A portion of the Gallegly amendment read:
Congress declares it to be the policy of the United States that...
aliens who are not lawfully present in the United States not be
entitled to public education benefits in the same manner as United
States citizens and lawful resident aliens...65
Supporters of the Gallegly Amendment argued that America's education system,
like other social-service programs, attracted a disproportionate number of immigrants and
that the cost of educating such children was too high in an era of tight school budgets.66
Opponents of the measure denounced it as cruel; hundreds of thousands of children could
potentially be turned away at the schoolhouse door.67
62 Abel Carmona, Dispelling Myths About Immigrant Students, IRDA Newsletter* May 1996
.
63 Ibid.
64 H. R. (2022).
65 Charles Levendosky, The Politics of Turning Children into Victims. Casper (Wvo.) Star Tribune. May
1996 October 1998.
66 Illegal Immigrant Children: In or Out of Public Schools? Education Week, April 1996,
.
67 Carmona, Dispelling Myths About Immigrant Students.


93
based upon their immigration status and no district could inquire into a student or
parents immigration status.121
In spite of the rapid growth in the numbers of non-English language background
students beginning with the decade of the 1960s, it was not until 1990, that policies were
established with regard to Limited English Proficient (LEP) student access to educational
opportunities. Rather than face potentially protracted, costly litigation resulting from a
class action suit on behalf of non-English language background students, the state entered
into a Consent Decree122 to ensure equitable educational opportunities for Floridas LEP
public schools. The Consent Decree put school districts on notice that policies and
practices had to be changed. According to the Decree, LEPs were to be provided
meaningful instruction to ensure English-language literacy and academic achievement.123
The Consent Decree was implemented in 1991, and although there were no major
international events to create high levels of immigration, two years later, in 1993, the
number of LEPs identified statewide nearly doubled.124 The number of LEPs continued
to grow as the identification process became more systematic. As a result of the
increased attention to assessment procedures, almost all of Floridas 67 districts had
increased numbers of identified English language deficient students.125
l2lConsent Decree, [s. 228.121,FS]. Nonresident Tuition Fee.
122 League of United Latin American Citizens (LULAC) et al. v. the State Board of Education et al.
Consent Decree, U.S. District Court for the Southern District of Florida, August 14, 1990.
123 Sandra H Fradd and Okhee Lee (1998). Creating Florida's Multilingual Global Workforce.
Tallahassee, FL: Florida Department of Education.
124 Florida Management Education Services. (1994). Current year student data by district. Tallahassee, FL:
Florida Department of Education.
125 Florida Department of Education. (1996a). 1994-95 annual status report on the implementation of the
1990 League of United Latin American Citizens (LULAC) et al v. State Board of Education Consent
Decree. Tallahassee, FL: Office of Multicultural Student Language Education.


67
immigration to the United States. The 1986 Immigration Reform and Control Act27
provided for employer sanctions against businesses that employed undocumented aliens
and legalization for qualified undocumented aliens. Immigration policy during the
decade of the 1990s was based on The Immigration and Nationality Act, which
prioritized eligibility on the basis of family reunification along with the need for
immigrants with specific skills.28
The Immigration and Nationality Act passed in 1952 over President Trumans
veto and remained the foundation for U.S. immigration law at the end of the twentieth
century, although it had been amended numerous times.29 Among the most far-reaching
of those amendments, the 1965 Immigration Act marked change in U.S. immigration
policy. From the decade of the 1920s until passage of the 1965 law, American
immigration policy had operated on a strict per-country quota system. The 1965 law
shifted that policy to a system that emphasized family reunification and employment or
job skills needed in the U.S. labor market.30 Besides family-based and employment
based immigration, refugees were expressly allowed to immigrate to the United States.
The Refugee Act of March 17, 198031 was prompted in large part by the arrival of
more than 400,000 refugees from Southeast Asia between 1975 and 1980. The
legislation sought to give refugee policy greater consistency by allowing for both a
27 Immigration Reform and Control Act of 1986, Public Law 99-603.
28 Immigration and Nationality Act Amendments of October 3, 1965, (79 Stat.911) as amended by the
Immigration Act of 1990, P.L. 101-649, (104 Stat. 4978).
29 James G. Gimpel and James R. Edwards Jr., 1999. The Congressional Politics of Immigration Reform,
Needham Heights, MA, Allyn & Bacon.
30 Ibid., p. 60.
11 Refugee Act of March 17, 1980, Immigration and Nationality Act, [ 101(a)(42)(A)].


22
The State of Florida was unable to prove to the federal government that illegal
immigration in Florida had a significant impact. Florida was forced to rely on
speculation on some of its figures, which weakened its case. The burden of proof of
additional costs due to illegal immigrants remained with the state.80
Florida's education costs for both legal and illegal immigrants in 1993 were
$517.6 million, which was up 24 percent from 1992's expenditure of $418.5 million. The
state spent $254 million alone on the English for Speakers of Other Languages (ESOL)
program.81
Education for illegal aliens totaled $180.4 million in 1993. This number
represented another 24 percent increase in costs from the previous year when illegal alien
education was $145.9 million. The increase was due to the rise in numbers of illegal
aliens arriving in Florida.82
According to Kathleen Vail, an assistant editor of The American School Board
Journal, much of the increase in public school enrollment was due to rising immigration.
This mounting enrollment strained schools that were already dealing with the recent
influx of immigrant children. The immigrant children taxed the schools further by
needing bilingual teachers and language programs. The schools were forced to spend
scarce resources on immigrant students. Immigrant families tended to have larger
80 John Digrado, News, Daily Bruin, May 1996, (October 1998).
81 Florida: Social Policy Issues, Immigration and Florida: Social Policy Issues, 1997,
(1 February 1998).
82
Ibid.


51
the quality of public education was improved by excluding a certain group of children
from educational opportunities. The state, they reasoned, had not justified its selection of
the particular group.89
As a result of the Supreme Courts decision, no school in the United States
could legally deny immigrant students admission on the basis of their undocumented
status, nor could they treat undocumented students differently than any other student.
Justices White, Rehnquist, and OConnor joined Chief Justice Burger in his
dissention of the ruling.91 In the minority, they felt that it was senseless for an
enlightened society to deprive any children including illegal alien of an elementary
education. However, the Constitution did not constitute us as Platonic Guardian, nor
did it vest in the Court the authority to eliminate laws because they did not meet our
standards of desirable social policy, wisdom, or common sense.92 (See APPENDIX
for further clarification.)
The minority of the Court had no problem with the conclusion that the Equal
Protection Clause of the Fourteenth Amendment applied to illegal aliens who were
physically within the jurisdiction of a state.93 The Equal Protection Clause did not
88 Ibid., p. 230.
89 Martha McCarthy, The Right to an Education: Illegal Aliens. Journal of Educational Equity and
Leadership 2 (Summer 1982): 283-85.
90 Plyler, 457 U.S. 245.
91 Ibid.
92 TVA v. Hill, 437 U.S. 153, (1978).
93
Plyler, 457 U.S. 215.


Ill
$1.2 billion (22.8%); Social Security (20.2%); Local government services (20%);
Medicaid (10.2%); and Criminal justice and corrections (5.4%).40
Population Data
According to Immigration and Naturalization Service (INS) figures for 1998,
population data indicated:
Table 4-2 Immigration and Florida
State population:
15,111,200
(1999 Census Bureau est.)
Foreign-bom population:
2,324,000
(1998 Current Population
Survey)(CPS)
Percent foreign bom:
16.0%
(1998)(CPS)
Immigrant Stock:
4,524,000
(1997 CB est.)
Percent U.S. citizen:
40.5%
(1997 CPS)
Illegal alien population:
350,000
(1996 Immigration and
Naturalization Service est.)
New legal immigrants:
605,478
(1991 to 1998)
2025 pop. Projection:
20,710,000
(1996 CB projection)
Source: Immigration and Florida, FAIR, 1999.
Florida had the third largest immigrant population in the United States in 1998
(after California and New York), and the fourth-largest immigrant population share of its
total population (after the above two states and Hawaii).41 More than one of every six of
its residents was foreign bom. About one in every eleven immigrants in the United States
40
Ibid.
41
Ibid.


167
determine that any particular undocumented child will in fact be deported until after
deportation proceedings have been completed. It would, of course, be most difficult for
the State to justify a denial of education to a child enjoying an inchoate federal
permission to remain.
We are reluctant to impute to Congress the intention to withhold from these
children, for so long as they are present in this country through no fault of their own,
access to a basic education. In other contexts, undocumented status, coupled with some
articulable federal policy, might enhance state authority with respect to the treatment of
undocumented aliens. But in the area of special constitutional sensitivity presented by
these cases, and in the absence of any contrary indication fairly discernible in the present
legislative record, we perceive no national policy that supports the State in denying these
children an elementary education. The State may borrow the federal classification. But
to justify its use as a criterion for its own discriminatory policy, the State must
demonstrate that the classification is reasonably adapted to the purposes for which the
state desires to use it.70 We therefore turn to the state objectives that are said to support
21.031.71 V
Appellants argue that the classification at issue furthers an interest in the
preservation of the states limited resources for the education of its lawful residents.72
69 8 U.S.C. 1252, 1253(h), 1254 (1976 ed. and Supp. IV).
70 Oyama v. California, 332 U.S. 633, 664-665 (1948) (Murphy, J., concurring) (emphasis added).
71 457 U.S. 227.
72 [Appellant School District sought at oral argument to characterize the alienage classification contained in
21.031 as simply a test of residence. We are unable to uphold 21.031 on that basis. Appellants conceded
that, if, for example, a Virginian or a legally admitted Mexican citizen entered Tyler with his school-age
children, intending to remain only six months, those children would be viewed as residents entitled to
attend Tyler schools. Tr. of Oral Arg. 31-32. It is thus clear that Tyler's residence argument amounts to


118
outcomes, which led to highly variable results across and within immigrant groups.
Chief among the sources of diversity were social class and language.
There was evidence that immigrant youths performed at least as well
academically and stayed in school longer than their U.S.-born majority-group peers of
similar class backgrounds.63 Other Immigrant students performed less well, causing
public stereotypes about specific immigrant groups. In addition to social class, the fact
that immigrant children were disproportionately represented among students with limited
English proficiency (LEP) greatly affected school achievement, in an absolute sense.64
Estimates of students with limited English proficiency ranged from 2.3 million65
to as high as 3.3 million 66 The Census Bureau further estimated that 1.8 million school-
age children lived in households in which no one age 14 or older spoke English very
well.67 The continued influx of new immigrant groups meant continuing increases in the
number of students who entered the American schools with little or no English
proficiency.
Ibid.
63 Lorraine M. McDonnell and Paul T. Hill, Newcomers in American Schools: Meeting the educational
needs of Immigrant Youth, Santa Monica, CA: RAND, 1993.
64 Immigrant Children and Their Families: Issues for Research and Policy, The Future of Children, Vol. 5,
No. 2, Summer/Fall 1995.
65 U.S. Department of Education. The Condition Of Bilingual Education In The Nation: A Report To The
Congress And The President. Washington, DC: U.S. Department of Education, 1991.
66 David Phillips and N. Crowell, eds. Cultural Diversity and Early Education: A Report of a workshop.
Washington, DC: National Academy Press, 1994.
67 Ruben G. Rumbaut, Origins and destinies: Immigration to the United States Since World War II,
Sociological Forum (December 1994), 9,4: pp.583-621.


156
Senator Howard, also a member of the Joint Committee of Fifteen, and the
floor manager of the Amendment in the Senate, was no less explicit about the broad
objectives of the Amendment, and the intention to make its provisions applicable to all
who may happen to be within the jurisdiction of a State: [457 U.S. 215]
The last two clauses of the first section of the amendment disable a State from
depriving not merely a citizen of the United States, but any person, whoever he may be,
of life, liberty, or property without due process of law, or from denying to him the equal
protection of the laws of the State. This abolishes all class legislation in the States and
does away with the injustice of subjecting one caste of persons to a code not applicable to
another.... It will, if adopted by the States, forever disable every one of them from
passing laws trenching upon those fundamental rights and privileges which pertain to
citizens of the United States, and to all person who may happen to be within their
jurisdiction.33
Use of the phrase within its jurisdiction thus does not detract from, but rather
confirms, the understanding that the protection of the Fourteenth Amendment extends to
anyone, citizen or stranger, who is subject to the laws of a State, and reaches into every
comer of a State's territory. That a person's initial entry into a State, or into the United
States, was unlawful, and that he may for that reason be expelled, cannot negate the
simple fact of his presence within the State's territorial perimeter. Given such presence,
he is subject to the full range of obligations imposed by the State's civil and criminal
laws. And until he leaves the jurisdiction -- either voluntarily, or involuntarily in
33 Ibid., p. 2766 (emphasis added).


142
what was being said or done. English language interpreters and students
who were already bi-lingual assisted in this effort. Student to student
mentoring was another good method of connecting immigrant students to
the overall school culture. Mixed group dynamics as members of the
same team also helped to overcome some cultural biases. It was
inherently difficult to move these children with groups other than the one
where they felt most comfortable.
8) Determine what investments the public was willing to make to ensure the
education and future economic success of immigrant children.32
Convincing tax-paying public to increase education spending was a
monumental task. Many of Floridas taxpayers migrated here from other
states in order to retire. These people did not want to fund an education
for children that did not belong to them. Many felt they had done their
duty in their former states of residence and were hard-pressed to consider
additional taxation for educational funding. Voters had defeated most
attempts at increases in property tax millage, increases in sales tax and
bond issues. A publicity plan needed to be developed to provide better
information the public of the benefits to society in general, that came from
the fiscal support of education. Successful programs have a well-defined
system of accountability and outcome data. A well-informed public was
much more likely to support programs that could show actual results. To
31 Abelardo Villarreal and Adela Solis, Effective Implementation of Bilingual Programs: Reflections from
the Field, EDRA Newsletter, January 1998.
"Vi
Immigrant Children and Their Families: Issues for Research and Policy, The Future of Children, Vol. 5,
No. 2, Summer/Fall 1995.


42
Americans was non-white.60 According to the 1990 census, one out of four Americans
claims to be non-white. The United States no longer consists of an overwhelming white
majority, with significant minorities of blacks, and to a lesser and more localized degree,
Hispanics, American Indians, and Asians.61
Immigration Policy After 1965
Congress made several substantive changes to immigration policy after 1965. The
Immigration Reform and Control Act of 198662 (IRCA) granted amnesty to certain illegal
immigrants and mandated employer sanctions for those hiring illegal immigrants as a way
to deter future arrivals.
The Immigration Act of 199063 increased the number of available immigrant visas
to 700,000, from the prior limit of 490,000, for fiscal years 1992-93 and 1993-94, and to
675,000 thereafter. Therefore, proposals to cut immigration by one-third did nothing
more than re-establish the immigration levels of the 1980s, the highest ever in the
country's history up to that time.
Immigrants arrived through a complicated system comprised of legal immigration,
family-based immigration, skills-based immigration, nationality-based visas, refugees
and asylum seekers, miscellaneous immigration, and illegal immigration.64 Third World
60 Bureau Of The Census, U.S. Department Of Commerce, Census Of Population 1960, Characteristics Of
The Population, pt. 1, at 145, tbl. 44 (1964).
61 Ibid.
62 Immigration Reform and Control Act, Pub. L. No. 99-603, 100 Stat. 3359 (1986).
63 The Immigration Act of 1990, Pub. L. No. 101-649 §§ 111-124, 104 Stat. 4978-97 (1990).
64 Brimelow, Alien Nation, pp. 33-35. Estimates ranged from 300,000 to 500,000 per year:


141
immigrant parent that involvement in their childrens learning was the
preferred behavior was difficult. A key to parent involvement involved
keeping the parents well informed about the ESOL program as well as the
general curricula and other activities in which the students participated.
Correspondence sent to the home should have been in the home language,
as should the information they received at school. Immigrant parents
should feel welcomed and encouraged to interact with the school. Parents
were encouraged to help at home and in the classroom, and given the
opportunity to have input in the various decisions the school had to make,
from how many computers to purchase to how much homework students
should have.31 PTA programs needed to include activities such as; meet-
the-teacher nights, native language guest speakers, cross-cultural dinners,
or culture fairs exhibiting customs of the students former countries.
Parents were invited to attend athletic, academic and performing arts
activities. Everything needed to be done to ensure that the school was
perceived as a safe, non-threatening haven where the parent could be
included in the education of their children.
7) Inclusion of limited English proficient children in all school-wide programs;
With so many LEP students in Florida, and with a heavier concentration in
some counties more than others, provisions were needed to accommodate
the inclusion of LEP students in school-wide programs. It was difficult
for a student to feel part of something when they could not understand


100
therefore, retained discretionary power over the collection, method and distribution of
educational funds. It delegated to local school districts to act on its behalf.1
Politicians, states attorneys general, and scholars have debated at length the very
sovereignty of federal law in its provision for public education to illegal residents. The
issue raised states' rights and federalism questions, concerns about the economic impact
of large school-age immigrant populations, and constitutional questions about the
separation of powers. Conservatives and strict constitutionalists had long decried the
encroachment of the federal judiciary on political questions, most of which, they argued,
rightly should be resolved at the state and local levels. Of particular relevance to
immigration policy was the 1982 Supreme Court decision in Plyler v. Doe. The Court
ruled that states could not deny public schooling to illegal immigrants.
Another Supreme Court decision with implications for the education of immigrant
children was Lau v. Nichols, rendered in 1974.3 This case focused on the rights of non-
English speaking children and corresponding duties of public schools to address their
unique needs. Specifically, Chinese students asserted that the San Francisco public
school program violated the Equal Protection Clause of the Fourteenth Amendment and
Title VI of the Civil Rights Act of 19644 by failing to make adequate provisions for the
needs of students with English language deficiencies. The Court held that the lack of
sufficient remedial English instruction violated Title VI, which prohibited discrimination
1 Cynthia McDaniels, Equality of Educational Opportunity: Race and Finance in Public Education, The
Constitution. Courts and Public Schools. Vol.l, 1992, Yale-New Haven Teachers Institute, Conn.
2 Plyler v. Doe, 457 U.S.202 (1982).
3 Lau v. Nichols, 414 U.S. 563 (1974).
4 42 U.S.C. § 2000(d).


56
The Plyler Court cited Ambach to emphasize the importance of transmitting
fundamental values to children.113 In Ambach, however, the Court stressed the
fundamental role of education in a manner which vindicated the right of states to better
control those who taught our children, even to the extent of excluding resident alien
teachers.114 Whereas Ambach concentrated on how the state transmitted values, and
through whom, Plyler, in fact, focused on those who received fundamental values. In
attempting to reconcile Ambach and Plyler, the question became whether teaching
children who have no legal right to be in the country creates less of a concern than the
possibility that an alien teacher legally present in the United States may teach in public
schools?115
The following timeline delineated United States immigration laws and policies
since 1790. The dates illustrated in bold indicate laws or policies of relevance to the
education of immigrant children. The first ruling of any significance to immigrant
education came in 1923 with Meyer v. Nebraska.Ub Most of these rulings were discussed
within the context of this paper.
113 Plyler, 457 U.S. at 221-23 (citing Ambach, 441 U.S. at 760).
n* Ambach, 441 U.S. at 77-79.
115 In Ambach, Justice Powell did not require evidence proving or disproving whether (legally resident)
alien teachers negatively affected the New York schools in any way: The issue was the public-interest
doctrine and the right of the state to regulate a sensitive public sphere. In contrast, Justice Brennan
emphasized the scant proof of negative economic impacts on Texas schools resulting from teaching the
children of illegal immigrants (Plyler, 457 U.S. at 228, 229). Justice Powell, who wrote the majority
decision in Ambach but concurred in Plyler, gave no clue why he did not use the public-interest doctrine in
Plyler other than emphasizing that the affected parties were children (Plyler, 457 U.S. pp. 236-240 [Powell,
J., concurring]). Justice Powells only mention of the concerns of ordinary citizens was the bland statement
that he was not unmindful of what must be the exasperation of responsible citizens and government
authorities in Texas and other States similarly situated. (Ibid., p. 240 [Powell, J., concurring]).
116 Meyer v. State of Nebraska, 262 U.S. 390 (1923).


152
The Fourteenth Amendment provides that [n]o State shall... deprive any person
of life, liberty, or property, without due process of law; nor deny to any person within its
jurisdiction the equal protection of the laws. (Emphasis added.) Appellants argue at the
outset that undocumented aliens, because of their immigration status, are not persons
within the jurisdiction of the State of Texas, and that they therefore have no right to the
equal protection of Texas law. We reject this argument. Whatever his status under the
immigration laws, an alien is surely a person in any ordinary sense of that term.
Aliens, even aliens whose presence in this country is unlawful, have long been
recognized as persons guaranteed due process of law by the Fifth and Fourteenth
Amendments.23 Indeed, we have clearly held that the Fifth Amendment protects aliens
whose presence in this country is unlawful from invidious discrimination by the Federal
Government.24
Appellants seek to distinguish our prior cases, emphasizing that the Equal
Protection Clause directs a State to afford its protection to persons within its jurisdiction,
while the Due Process Clauses of the Fifth and Fourteenth Amendments contain no such
assertedly limiting phrase. In appellants view, persons who have entered the United
States illegally are not within the jurisdiction of a State even if they are present within a
State's boundaries and subject to its laws. Neither our cases nor the logic of the
Fourteenth Amendment support that constricting construction of the phrase within its
jurisdiction.25 We have never suggested that the class of persons who might avail
23 Shaughnessy v. Mezei, 345 U.S. 206, 212 (1953); Wong Wing v. United States, 163 U.S. 228,238 (1896);
Yick Wo v. Hopkins, 118 U.S. 356, 369 (1886).
24 Mathews v. Diaz, 426 U.S. 67, 77 (1976).
25 [Although we have not previously focused on the intended meaning of this phrase, we have had occasion
to examine the first sentence of the Fourteenth Amendment, which provides that [a]ll persons bom or


183
rationally that anyone benefits from the creation within our borders of a subclass of
illiterate persons, many of whom will remain in the State, adding to the problems and
costs of both State and National Governments attendant upon unemployment, welfare,
and crime.131 BURGER, J., dissenting.
CHIEF JUSTICE BURGER, with whom JUSTICE WHITE, JUSTICE REHNQUIST,
and
JUSTICE O'CONNOR join, dissenting.
Were it our business to set the Nation's social policy, I would agree without
hesitation that it is senseless for an enlightened society to deprive any children --
including illegal aliens of an elementary education. I fully agree that it would be folly -
- and wrong to tolerate creation of a segment of society made up of illiterate persons,
many having a limited or no command of our language. However, the Constitution does
not constitute us as Platonic Guardians, nor does it vest in this Court the authority to
strike down laws because they do not meet our standards of desirable social policy,
wisdom, or common sense.132 We trespass on the assigned function of the political
branches under our structure of limited and separated powers when we assume a policy
making role as the Court does today.
will ultimately naturalize. Until an undocumented alien is ordered deported by the Federal Government, no
State can be assured that the alien will not be found to have a federal permission to reside in the country,
perhaps even as a citizen. Indeed, even the Immigration and Naturalization Service cannot predict with
certainty whether any individual alien has a right to reside in the country until deportation proceedings have
run their course. See, e.g., 8 U.S.C. 1252, 1253(h), 1254 (1976 ed. and Supp. IV).]
131 [457 U.S. 242]
132
TVA v. Hill, 437 U.S. 153, (1978).


60
Illegal immigrant education legislation was historically in favor of providing said
education to all students in residence in a given state, whether legal or otherwise, and in a
language conducive to their learning success.
Given the laws and trends in immigration, educators in every sector expected a
substantial share of their students to come from other countries. Immigration in both its
legal and illegal manifestations continued to rise to higher levels than ever before in the
nations history.
Although a larger number of highly educated immigrants were on their way, an
even greater flow of illegal immigrants enlarged the nations pool of illiterate or poorly
educated residents. The continued emphasis on family reunification also brought large
numbers of immigrants who tended to have less education that the original entrants
Educators in the United States needed to be ready to serve an even more diverse clientele
in its future


143
support this need for public education, plans were needed to involve
taxpayers, esp. retirees, from the ground up, issue by issue, in addressing
those needs and in determining least-cost solutions and responsible use of
funds.
Additional strategies like School-to-Work, that provided career exploration
activities as they related to post-secondary education, needed to be developed to
encourage immigrant youths ages 14-17 to pursue their secondary education. Policies
should be able to address immigrant students special needs within the context of
education reform efforts emphasizing systemic initiatives to improve educational
outcomes for all children. Failure to do so would result in hundreds of thousands of
young people without a high school diploma and without prospects for economic
mobility over their lifetime.
Summary
Public education was not a right granted to individuals by the Constitution.33
But neither was it merely some governmental benefit indistinguishable from other
forms of social welfare legislation. Both the importance of education in maintaining our
basic institutions and the lasting impact of its deprivation on the life of the child marked
the distinction. The American people had always regarded education and [the]
acquisition of knowledge as matters of supreme importance.34 They recognized the
public schools as a most vital civic institution for the preservation of a democratic system
33 San Antonio Independent School District v. Rodriguez, 411 U.S. 1, 35 (1973).
34 Meyer v. Nebraska, 262 U.S. 390, 400 (1923).


26
Legal research, as generally defined, was a systematic investigation, which
involves interpreting and explaining the law.92 Historically, legal research has relied on
precedent.
The methodology utilized in this study was not only to review the previous and
current policies, but also to build a foundation for designing a model for undocumented
immigrant education policy for the state of Florida.
Definition Of Terms
1) Undocumented immigrant: designates persons who are correspondingly
referred to as illegal immigrants or illegal aliens. Congressional Research
Service defines illegal aliens as persons who have violated immigration law.
2) Fundamental Rights: those rights explicitly or implicitly provided by the
federal constitution such as the right to exercise First Amendment freedoms.
The courts have found that education is a not fundamental right.
3) Procedural due process: guarantees procedural fairness where a persons
property or liberty is deprived by the government.
4) Suspect Classification: deserving of special scrutiny include those based on
race, national origin, religion, alienage, non-residency.
5) Undocumented aliens: persons who are in the United States in violation of the
Immigration and Naturalization Act. They either entered this country illegally
or entered legally, then violated conditions of entry.
6) Undocumented alien children: children who live with their parents who are
residing in the United States illegally; children whose parents reside in
another country, and the children are residing in the United States with
someone who is not their parent, guardian, or person having lawful control
for the sole purpose of attending free public school.
7) Newcomer: a recent immigrant, either legal or illegal.
92 Charles J. Russo, Legal Research: The 'Traditional Method, 28 NOLPE Notes 2 (October 1993).


64
aliens income and resources was deemed to include those of the affiant for a certain
number of years after the aliens admission. 14
In contrast to both lawfully admitted permanent residents and PRUCOLs,
undocumented immigrants were ineligible for federal and state benefit programs.15 There
were some exceptions, typically for emergency services, those services for which denial
would endanger the general public, and any services that had been held to be
constitutionally required. Examples included emergency medical, immunization
programs, and public education.16
In the movement to strip undocumented immigrants of the few public benefits for
which existing laws left them eligible, there were many generic arguments already
discussed. There were also a number of additional points specific to undocumented
immigrants.17
The principal argument for withholding public benefits from undocumented
immigrants was that they were in the United States illegally.18 As wrongdoers, the
argument went, they had no moral claim to receive services from the very government
whose laws they had transgressed. The analogy was to a trespasser seeking support from
the landowner whose property he or she had wrongfully entered.19
14 Ibid., pp. 129-31 (three years for AFDC and Food Stamps; five years for SSI).
15 CIR., pp. 115-17.
Ibid.
17 42 UCLA L. Rev. 1453, *1467.
18 Ibid., p. 29.
19
Ibid.


201
Characteristics and Performance of High School Students in Dade County
(Miami) Schools. CDS Report No. 24. (August 1990).
Rumbaut, Ruben G. Origins and destinies: Immigration to the United States Since World
War II, Sociological Forum 9,4, pp.583-621, (December 1994).
Russo, Charles J. Legal Research: The Traditional Method, 28 NOLPE Notes 2
(October 1993).
Schlessinger, Jr., Arthur M. The Disuniting of America (1993).
Schuck, Peter H. The Meaning of 187: Facing Up to Illegal Immigration, The American
Prospect No. 21, Spring 1995.
Serrano, House of Representatives, .
Simon, Julian. Immigration: The Demographics and Economic Facts. Washington, DC:
Cato Institute and National Immigration Forum (1995).
Stacey, N. Social Benefits of Education, The Annuals of the American Academy,
September 1998.
Stewart, David W. Immigration and Education: The Crisis and the Opportunities. New
York, Lexington Books (1993).
Thompson, David C., Wood, R. Craig, and Honeyman, David S., Fiscal Leadership for
Schools: Concepts and Practices, Longman, New York (1994).
Toriz, Roco Del Sagrario. "Federal and State Responsibility for Undocumented
Immigration," Berkeley McNair Journal Three, no. Summer 1995 (1995).
.
Tumlin, Karen C., Zimmermann, Wendy, and Ost, Jason, State Snapshots of Public
Benefits for Immigrants: A Supplemental Report to Patchwork Policies. The
Urban Institute, Washington, DC, (1999).
U.S. Census Bureau, Illegal Alien Resident Population, (1996).
U.S. Census, 1990.
U.S. Department of Education. The Condition Of Bilingual Education In The Nation: A
Report To The Congress And The President. Washington, DC: U.S. Department
of Education, 1991.


178
granted to citizens, excepting only those rights bearing on political interests.113 And, as
JUSTICE POWELL notes, the structure of the immigration statutes makes it impossible
for the State to determine which aliens are entitled to residence, and which eventually
will be deported.114 Indeed, any attempt to do so would involve the State in the
administration of the immigration laws. Whatever the State's power to classify
deportable aliens, then and whatever the Federal Government's ability to draw more
precise and more acceptable alienage classifications -- the statute at issue here sweeps
within it a substantial number of children who will in fact, and who may well be entitled
to, remain in the United States. Given the extraordinary nature of the interest involved,
this makes the classification here fatally imprecise. And, as the Court demonstrates, the
Texas legislation is not otherwise supported by any substantial interests.
Because I believe that the Court's carefully worded analysis recognizes the
importance of the equal protection and preemption interests I consider crucial, I join its
opinion as well as its judgment. POWELL, J., concurring.
JUSTICE POWELL, concurring.
I join the opinion of the Court, and write separately to emphasize the unique
character of the cases before us.115 The classification in question severely disadvantages
children who are the victims of a combination of circumstances. Access from Mexico
into this country, across our 2,000-mile border, is readily available and virtually
uncontrollable. Illegal aliens are attracted by our employment opportunities, and perhaps
113 Nyquist v. Mauclet, 432 U.S. 1 (1977).
114 Inf. p. n. 6.
us
[457 U.S. 237]


IMMIGRATION AND EDUCATION LEGISLATION
AND ITS EFFECTS ON POLICIES RELATING TO
UNDOCUMENTED IMMIGRANT CHILDREN
By
ROSE ALVINE RASKA
A DISSERTATION PRESENTED TO THE GRADUATE SCHOOL OF THE
UNIVERSITY OF FLORIDA IN PARTIAL FULFILLMENT OF THE
REQUIREMENTS FOR THE DEGREE OF
DOCTOR OF PHILOSOPHY
UNIVERSITY OF FLORIDA
2000


134
The Consent Degree, variously known as the English for Speakers of Other
Languages (ESOL) Agreement, the Department of Education (DOE)Multicultural
Education Training Advocacy, Inc. (META) Agreement, and the Doe-META Consent
Decree, governed the education of LEP students in the state of Florida, in grades Pre-K to
12.
The Consent Decree was incorporated into Florida Statutes (233.058) and State
Board of Education Rules (6A-6.900 6A-6.909). The viability of the decree does not,
however, depend on its being sanctioned by state statute and rule.
The essence of the Consent Decree was the right of LEP students to
comprehensible instruction. Comprehensible instruction was predicated upon appropriate
student assessment and placement, equal access by LEP students to all educational
programs, and training of instructional, administrative and staff personnel on the
instructional requirements of LEP students.
The Consent Decree required that students be provided comprehensible
instruction in English language arts and subject matter content. Instruction needed to
reflect ESOL strategies that ensured students acquired literacy in English. No specific
curricula was designated at the state level because students were expected to have access
to a full curriculum on par with their English-proficient peers.21
Florida School Laws
Florida school laws were based on precedent federal and state polices and rules.
232.01 Regular school attendance required between ages of
6 and 16; permitted at age of 5; exceptions.
21 Sandra H. Fradd, and Okhee Lee, (1998). Creating Floridas Multilingual Global Workforce.
Tallahassee, FL: Florida Department of Education.


83
whom it has classified as needy.85 Under California's own equal protection provision,
education was treated as a matter of fundamental interest whose unique importance ..
. in California's constitutional scheme required careful scrutiny of state interference with
basic educational rights.86 That was why some California plaintiffs attacked Proposition
187 in their state court, urging the Plyler analysis.87
Proposition 187, like the Official English laws approved in California and
elsewhere since the mid-1980s, was a symbolic message to policy elites. These measures
were grand gestures with few practical consequences other than to convince politicians
that many voters viewed American society as increasingly alien (literally) and
uncontrollable. Voters responded angrily to the vivid television images of Mexican
officials denouncing the measure and to the marchers in Los Angeles waving Mexican
flags and protesting its limits on welfare benefits. On election day, the voters indicated
that illegal immigrants, industrious as they were, were part of the problem and that
Proposition 187, crude as it was, was part of the solution. It was no solution, of course,
but that only underscored the need for a sounder political response in order to forestall
future initiatives of this kind.
The U.S. Congress was far less constrained than the states in the classification of
aliens, having a preeminent role in their regulation.88 As the Supreme Court has said,
Over no conceivable subject is the legislative power of Congress more complete.89
85 See New York Constitution, Article XVII; Tucker v. Toia, 43 NY2d 1, 8 (1977).
86 See California Constitution, Article I, Sec.7(a). See also Serrano v. Priest, 18 Cal3d 728, 767-68 (1976).
87 Mailman, 187 and Its Lessons, p.3, col.l.
88 See Toll v. Moreno, 458 U.S. I, 10 (1982).
89 See Mathews v. Diaz, 426 U.S. 67 (1976).


95
charged to pupils who were homeless, pupils whose parents were in the military, worked
198
for the military or to migrant children, or who resided in HRS residential facilities.
Districts could not request proof of immigration status such as alien registration
number, tourist visa, passport, etc. In order to fulfill its requirement for eligibility for
federal funds such as the Emergency Immigrant Education Act or the Refugee/Entrant
Targeted Assistance Program,129 the only information that could be required from
foreign-bom students was their country of birth, and their date of entry into the United
1 IQ
States. However, school enrollment could not be delayed pending this information.
School districts had to ensure that refugees and foreign-bom children were
provided free, equal and unhindered access to appropriate public education. No copies of
any immigration documentation could be elicited or maintained as part of a students
records.131
In Florida, the 345,000 illegal immigrants estimated to be in the state in 1992 cost
$913 million more than their tax contributions.132 Public education, including bilingual,
adult and compensatory education in 1992 was 22.8 percent of all direct outlays for
immigrants. Local government services, including indigent medical care, mental health,
and family and child welfare services, accounted for 20 percent of immigrant costs.
Social Security outlays were put at 20.2 percent. The three foregoing programs, together
128 Consent Decree [s. 228.121 (l)-(4), FS], Non-resident Tuition Fee.
129 The Emergency Immigrant Education Act (EIEA), Title IV, part D of the Elementary and Secondary
Education Act, as amended, (20 U.S.C. 3121-3130).
130 Consent Decree [s. 228.121.FS], Non-resident Tuition Fee
131 Ibid.
132 What does immigration cost Florida each year?, < www.caiTvingcapacitv.org/HuddleFlorida.htm.>.


75
prison for five years or by a fine of twenty-five thousand dollars....
No public elementary or secondary school shall admit, or permit
the attendance of, any child who is not a citizen of the United
States, an alien lawfully admitted as a permanent resident, or
persons who are otherwise authorized to be present in the United
States.... In order to carry out the intention of the People of
California that, excepting emergency medical care as required by
federal law, only citizens of the United States and aliens lawfully
admitted to the United States may receive the benefits of publicly-
funded health care.54
Basically, Proposition 187 made illegal aliens ineligible for public social services,
public health care services, and public school education at elementary, secondary, and
post secondary levels.55 It also created substantial criminal penalties for the manufacture,
distribution, sale, or use of false citizenship or permanent residence documents. It
required state and local law enforcement officials to cooperate with the INS in identifying
and apprehending undocumented aliens.56
Proposition 187 was a combination of different policies that sought to stem the
flow of illegal aliens into California. It was designed to encourage the state's roughly 1.4
million illegal residents to go home, and expel the rest. The most controversial
provisions barred anyone who was not a citizen, legal permanent resident (green card
holder), or legal temporary visitor from receiving public social services, health care, and
education. The provisions differed slightly for each service, but they generally imposed
three duties on all service providers: the verification of the immigration status of all who
sought services, the prompt notification of state officials and the INS of anyone who was
determined or reasonably suspected to be in violation of immigration laws, and the
54 Ibid.
55 Schuck, Illegal Immigration, pp. 85-92.


LIST OF TABLES
Table page
1-1 Estimated Illegal Immigrant Population for Top Twenty Countries of Origin and
Top Twenty States of Residence: October 1996 13
2-1 Timeline of U.S. Immigration and Alien Education Policies 57
3-1 Immigration to the U.S. in 1992 69
4-1 Florida EIEP Student Funding (100% Federal Funding) 108
4-2 Immigration and Florida Ill
vi 1


5
established broad legal limits to immigration by excluding Asian immigration. The 1882
law also solidified the primacy of the federal government to determine immigration law
and policy.6 This prohibition was carried forward in the Immigration Act of 1917, and
was recodified in the Immigration and Nationality Act both when it was enacted on June
27, 1952 and again in 1990.7
The controversy over illegal immigration began in 1875 when the U.S.
established its first law restricting immigration, which prohibited the entrance of convicts
and prostitutes. Since that time, the U.S. struggled to control its borders. Every year
thousands more found passage in, adding to the already five million immigrants who had
entered the country illegally or overstayed their visas.8
From 1880 to 1920, 23,465,000 people immigrated to the United States; the great
majority of these immigrants were from southern and eastern Europe.9 Public agitation
grew steadily during this period to limit further immigration, despite the opposition of
business interests.10
6 Federal power over immigration lies in the United States Constitution: To establish an uniform Rule of
Naturalization, U.S. Constitution Art. I, § 8, cl. 4.
7 U.S. House of representatives Ways And Means Committee Print: 104-14 [ 1996 Green Book] Appendix
J. Noncitizens The Personal Responsibility and Work Opportunity Reconciliation Act and Associated
Legislation, 1996, (25 February 1997).
8 Kathleen Vail, No Entry, The American School Board Journal 183, no. 9 (September/96 1996): 22-25.
9 Marion T. Bennett, American Immigration Policies: A History, 15 (1963) quoted in Gregg Van De Mark,
Too Much of a Good Thing, Washington Law Journal 35, no. 3 (Spring 1996).
10 The main concerns of those pushing for immigration controls were the assimilability of the new
immigrants, their sheer numbers, and their effect on the nation's politics, language, and culture. Thomas A.
Alienkoff and David Martin, Immigration: Process and Policy, pp. 1-42 (interim 2d ed. 1991) quoted in
Van De Mark Washington Law Journal 35.


149
while the exclusion of all undocumented children from the public schools in Texas
would eventually result in economies at some level,7 funding from both the State and
Federal Governments was based primarily on the number of children enrolled. In net
effect, then, barring undocumented children from the schools would save money, but it
o
would not necessarily improve the quality of education. The court further observed
that the impact of 21.031 was borne primarily by a very small subclass of illegal aliens,
entire families who have migrated illegally and for all practical purposes
permanently to the United States.9 Finally, the court noted that, under current laws and
practices, the illegal alien of today may well be the legal alien of tomorrow, and that,
without an education, these undocumented children, already disadvantaged as a result of
poverty, lack of English-speaking ability, and undeniable racial prejudices,... will
become permanently locked into the lowest socio-economic class.10
The District Court held that illegal aliens were entitled to the protection of the
Equal Protection Clause of the Fourteenth Amendment, and that 21.031 violated that
Clause. Suggesting that the state's exclusion of undocumented children from its public
schools ... may well be the type of invidiously motivated state action for which the
suspect classification doctrine was designed, the court held that it was unnecessary to
decide whether the statute would survive a strict scrutiny analysis because, in any
7 Ibid.,, p. 576.
8 Ibid., p. 577.
9 Ibid., p. 578.
10 Ibid., p. 577.


160
The children who are plaintiffs in these cases are special members of this
underclass. Persuasive arguments support the view that a State may withhold its
beneficence from those whose very presence within the United States is the product of
their own unlawful conduct. These arguments do not apply with the same force to
classifications imposing disabilities on the minor children of such illegal entrants. At
the least, those who elect to enter our territory by stealth and in violation of our law
should be prepared to bear the consequences, including, but not limited to, deportation.
But the children of those illegal entrants are not comparably situated. Their parents
have the ability to conform their conduct to societal norms, and presumably the ability
to remove themselves from the State's jurisdiction; but the children who are plaintiffs in
these cases can affect neither their parents conduct nor their own status. Even if the
State found it expedient to control the conduct of adults by acting against their children,
legislation directing the onus of a parents misconduct against his children does not
comport with fundamental conceptions of justice. [Vjisiting ... condemnation on the
head of an infant is illogical and unjust. Moreover, imposing disabilities on the ... child
is contrary to the basic concept of our system that legal burdens should bear some
relationship to individual responsibility or wrongdoing. Obviously, no child is
responsible for his birth, and penalizing the ... child is an ineffectualas well as unjust-
way of deterring the parent.44
State may independently exercise a like power. But if the Federal Government has, by uniform rule,
prescribed what it believes to be appropriate standards for the treatment of an alien subclass, the States
may, of course, follow the federal direction. See De Canas v. Bica, 424 U.S. 351 (1976). Ed.]
42 Plyler, 457 U.S. 220
43 Trimble v. Gordon, 430 U.S. 762, 770 (1977).
44 Weber v. Aetna Casualty & Surety Co., 406 U.S. 164, 175 (1972).


148
been legally admitted into the United States. The action complained of the exclusion of
plaintiff children from the public schools of the Tyler Independent School District. The
Superintendent James Plyler, and members of the Board of Trustees of the School
District were named as defendants; the State of Texas intervened as a party-defendant.
After certifying a class consisting of all undocumented school-age children of Mexican
origin residing within the School District, the District Court preliminarily enjoined
defendants from denying a free education to members of the plaintiff class. In December,
1977, the court conducted an extensive hearing on plaintiffs' motion for permanent
injunctive relief. [457US-2071
In considering this motion, the District Court made extensive findings of fact.
The court found that neither Section 21.031 of the Texas Education Code nor the School
District policy implementing it had either the purpose or effect of keeping illegal aliens
out of the State of Texas.5 Respecting defendants' further claim that 21.031 was simply a
financial measure designed to avoid a drain on the State's fisc, the court recognized that
the increases in population resulting from the immigration of Mexican nationals into the
United States had created problems for the public schools of the State, and that these
problems were exacerbated by the special educational needs of immigrant Mexican
children. The court noted, however, that the increase in school enrollment was primarily
*
attributable to the admission of children who were legal residents.6 It also found that,
5 458 F.Supp. 569,575 (1978).
6 Ibid., pp. 575-576. [Plaintiffs' expert, Dr. Gilbert Cardenas, testified, fifty to sixty per cent... of current
legal alien workers were formerly illegal aliens. Ibid., p. 577. A defense witness, Rolan Heston, District
Director of the Houston District of the Immigration and Naturalization Service, testified that undocumented
children can and do live in the United States for years, and adjust their status through marriage to a citizen
or permanent resident. Ibid. The court also took notice of congressional proposals to legalize the status
of many unlawful entrants. Ibid., pp. 577-578. See also n. 17, infra. Ed.]


79
effect of doing that, and Brennan agreed. The Texas law might have saved some money,
according to Brennan, but Texas failed to establish that illegal aliens imposed a
significant fiscal burden on state coffers or that their exclusion would improve the quality
of education. In addition, Brennan said, federal immigration policy was not concerned
with conserving state educational resources, much less with denying an education to a
child enjoying an inchoate federal permission to remain.69 (This referred to the
possibility that an illegal alien might obtain discretionary relief from deportation.) All
the Texas law would serve to do, Brennan said, was to promote the creation and
perpetuation of a subclass of illiterates,70 who would be socially dysfunctional and a
burden to society. That, he said, clearly was not something the states were allowed to do.
The parallels from Plyler to Proposition 187 were obvious. Both would in effect
bar undocumented children from the public schools; if anything, California's new ban on
enrolling such children was even more categorical and rigid than the Texas statute
invalidated in Plyler. Any court that accepted Brennan's premises in Plyler would have
had difficulty sustaining Proposition 187.71
If aliens remained in the United States, paid taxes and became part of the
community, their misfortunes had to be dealt with, for their sake and that of society. A
lesson from Plyler was that children could not be punished for evasion of immigration
laws, and, if they were allowed to remain here, they would be educated (and otherwise
cared for) in the general community interest. A second lesson was that aliens came to
69 Ibid.
70 Ibid.
71
Ibid.


145
older boys. A substantial proportion of the LEP youth were US-born, suggesting that
their problem was not simply recency of arrival from another country. Any policies
meant to address their needs needed to be much more systematic and intensive than
simply offering them additional language instruction.40
Given the modest family origins and material resources of many of these children,
their aspirations and expectations were at odds with what many were able to achieve: it
remained an open empirical question what would happen to these youth if their
aspirations were frustrated, and what the consequences would be if they were, not just for
the students themselves, but for the nation as a whole.
America in the future will be more racially, ethnically, and culturally diverse than
ever before, largely as a result of immigration patterns. Children, far from being a fringe
element of Americas population, will continue to be a large and increasing core
ingredient of our communities, our schools, and our society.41
As a nation and a state, Florida had been doing a satisfactory job of achieving the
goal of educating immigrant children in elementary and secondary education on par with
non-immigrant children. To be even more effective, the immigrant education programs
needed the careful consideration of equality and equity for all children. Education policy,
therefore, should sustain and further develop initiatives designed to provide quality
educational opportunities for ALL children, of all races and ethnicities and of all
circumstances, who reside within the state of Florida.
40 Ibid., p. 13.
41 Ibid., p. 15.


206
TEXAS EDUCATION CODE ANN. § 21.03 (Vernon Supp. 1981). The Emergency
Immigrant Education Act (EIEA), Title IV, part D of the Elementary and
Secondary Education Act, as amended, (20 U.S.C. 3121-3130).
Title VI of the Civil Rights Act at 42 U.S.C. § 2000d.
Toll v. Moreno, 458 U.S. I, 10 (1982).
7VA v. Hill, 437 U.S. 153, (1978).
U.S. Census Bureau, Illegal Alien Resident Population, 1996.
U.S. Census, 1990.
U.S. Commission on Immigration Reform, U.S. Immigration Policy: Restoring
Credibility 139-43 (1994).
U.S. Constitution, Art. VI, cl.2.
U.S. Constitution, Article VI.
U.S. House of Representatives Ways And Means Committee Print: 104-14 [1996 Green
Book] "Appendix J. Noncitizens" The Personal Responsibility and Work
Opportunity Reconciliation Act and Associated Legislation, 1996.
U.S. House of Representatives, Ways And Means Committee Print: 104-14 [1996 Green
Book]
Voting Rights Act of 1965, Pub. L. No. 89-110, 79 Stat. 437.
Wisconsin v. Yoder, 406 U.S. 205, 221 (1972).
Wong Yang Sung v. McGrath, 339 U.S. 33 (1950), modified, 339 U.S. 908.
Yick Wo v. Hopkins, 118 U.S. 369 (1886).


102
On August 14, 1990, a Consent Decree10 was signed in United States District
Court on behalf of the Florida State Board of Education and of the plaintiffs who had
alleged that the State Board of Education had not complied with its obligations under
federal and state law to ensure that the Florida school districts provided equal and
comprehensible instruction to Limited English Proficient (LEP) students.
The Consent Decree, variously known as English for Speakers of Other
Languages (ESOL) Agreement, the Department of Education (DOE), Multicultural
Education Training Advocacy, Inc. (META) Agreement, and the Doe-META Consent
Decree,11 governed the education of LEP students in the state of Florida, in grades Pre-K
to 12. It was incorporated into Florida Statutes (233.058) and Florida State Board of
Education Rules (6A-6.900 6A-6.909). The viability of the decree did not depend on
its being sanctioned by state statute and rule.12 The agreement was also significant
because it prevented the state from requesting specific information relative to
immigration status (except for information relative to the Emergency Immigrant
Education Program and refugee education programs). Beginning with the 1990-91 fiscal
year, all students were surveyed on their English proficiency, and new students were
surveyed in subsequent years. Students classified as Limited English Proficient (LEP)
became eligible for appropriate classroom instruction.13
10 League of United Latin American Citizens (LULAC) et al. v. the State Board of Education et al. Consent
Decree, U.S. District Court for the Southern District of Florida, August 14, 1990.
" Ibid.
12 The Unfair Burden, Immigrations Impact on Florida, Florida Governors Office, Tallahassee, FI.,
March 1994.
13
Ibid.


176
when those children are members of an identifiable group, that group -- through the
State's action will have been converted into a discrete underclass. Other benefits
provided by the State, such as housing and public assistance, are, of course, important; to
an individual in immediate need, they may be more desirable than the right to be
educated. But classifications involving the complete denial of education are, in a sense,
unique, for they strike at the heart of equal protection values by involving the State in the
creation of permanent class distinctions. I03ln a sense, then, denial of an education is the
analogue of denial of the right to vote: the former relegates the individual to second-class
social status; the latter places him at a permanent political disadvantage. 104
This conclusion is fully consistent with Rodriguez. The Court there reserved
judgment on the constitutionality of a state system that "occasioned an absolute denial of
educational opportunities to any of its children," noting that no charge fairly could be
made that the system [at issue in Rodriguez] fails to provide each child with an
opportunity to acquire ... basic minimal skills.105 And it cautioned that, in a case
involving] the most persistent and difficult questions of educational policy,... [the]
Court's lack of specialized knowledge and experience counsels against premature
interference with the informed judgments made at the state and local levels.106 Thus
Rodriguez held, and the Court now reaffirms, that a State need not justify by compelling
necessity every variation in the manner in which education is provided to its population.
103 Cf. Rodriguez, 411 U.S. p. 115, n. 74 (MARSHALL, J., dissenting).
104 457 U.S. 235.
105 Cf. Rodriguez, 411 U.S. p. 37.
106 Ibid., p. 42.


157
accordance with the Constitution and laws of the United States he is entitled to the
equal protection of the laws that a State may choose to establish.
Our conclusion that the illegal aliens who are plaintiffs in these cases may claim
the benefit of the Fourteenth Amendment's guarantee of equal protection only begins the
inquiry. The more difficult question is whether the Equal Protection Clause has been
violated by the refusal of the State of Texas to reimburse local school boards for the
education of children who cannot demonstrate that their presence within the34 United
States is lawful, or by the imposition by those school boards of the burden of tuition on
those children. It is to this question that we now turn. Ill
The Equal Protection Clause directs that all persons similarly circumstanced
shall be treated alike.35 But so too, [t]he Constitution does not require things which are
different in fact or opinion to be treated in law as though they were the same.36 The
initial discretion to determine what is different and what is the same resides in the
legislatures of the States. A legislature must have substantial latitude to establish
classifications that roughly approximate the nature of the problem perceived, that
accommodate competing concerns both public and private, and that account for
limitations on the practical ability of the state to remedy every ill. In applying the Equal
Protection Clause to most forms of state action, we thus seek only the assurance that the
classification at issue bears some fair relationship to a legitimate public purpose.
34 457 U.S.216.
35 F. S. Royster Guano Co. v. Virginia, 253 U.S. 412, 415 (1920).
36 Tigner v. Texas, 310 U.S. 141, 147 (1940).


131
territorial jurisdiction, without regard to any differences of race, of color, or of
nationality, and the protection of the laws was a pledge of the protection of equal laws.10
The federal statute regarding English Language Learners was the Equal Education
Opportunities Act (EEOA).11 It provided that:
No states shall deny equal education opportunity to an individual
on account of his race, color, sex, or national origin by -
(f) the failure by an educational agency to take appropriate action
to overcome language barriers that impede equal participation by
its students in its instructional programs.
In addition, Title VI of the Civil Rights Act12 states:
No person in the United States shall, on the ground of race color,
or national origin be excluded from participation in, be denied the
benefits of, or be subjected to discrimination under any program or
activity receiving federal financial assistance.
In Lau v. Nichols,1'* the United States Supreme Court held that the San Francisco
School Districts failure to provide supplemental English Language instruction to
Chinese speaking students violated Title VI of the Civil Rights Act at 42 U.S.C. § 2000d.
Following the Lau case, the Fifth Circuit Court of Appeals decided the case of
Castaneda v. Pickard.'4 In this case the federal appellate court stated a three-pronged test
to determine whether a school districts language remediation program was appropriate.
First, the court must determine whether a school district was pursuing a program
10 Yick Wo v. Hopkins, 118 U.S. 369 (1886).
11 Equal Education Opportunities Act (EEOA) at 20 U.S.C. § 1703.
12 Title VI of the Civil Rights Act at 42 U.S.C. § 2000d
13 Lau v. Nichols (1974) 414 U.S. 53.


8
legislation as the 1964 Civil Rights Act23 and the 1965 Voting Rights Act24 in response to
the new activist mood.25
The 1965 Immigration Act26 abolished the old national origins formula. Each
country outside of the Western Hemisphere received unlimited visas for relatives of
citizens and 20,000 visas for ordinary immigrants.27 The Act set quotas on immigration
from the nations of the Western Hemisphere for the first time. The 1965 Act also offered
a first-in-time, first-in-right system for 120,000 immigrants not related to United States
28
citizens.
Immigration resulting from the 1965 Immigration Act altered the demographic
makeup of the United States over a mere thirty-year period. In 1960, one out of ten
Americans was non-white.29 According to the 1990 census, one out of four Americans
claimed to be non-white.30 The United States no longer consisted of an overwhelming
white majority, with significant minorities of blacks, Hispanics and to a lessor and more
localized degree, American Indians and Asians.
23 Civil Rights Act of 1964, Pub. L. No. 88-352, 78 Stat. 241.
24 Voting Rights Act of 1965, Pub. L. No. 89-110, 79 Stat. 437.
25 Exec. Order No. 11,246, 3 C.F.R. 339 (1964-65).
26 Immigration Act of 1965, Pub. L. No. 89-235, 79 Stat. 911 (codified as amended at 8 U.S.C. § 1-14354
(1994).
27 Bill Ong Hing, Making and Remaking Asia America through Immigration Policy 1850-1990x pp. 38-41
(1993); quoted in Van De Mark, Too Much of a Good Thing.
28 Ibid.
29 Bureau of the Census, U.S. Department of Commerce, Census Population of 1960, Characteristics of the
Population, pt. 1, at 145, tbl. 44 (1964).
30 Bureau of the Census, U.S. Department of Commerce, 1990 Census of Population, General Population
Characteristics, 323 tbl. 253 (1992).


194
advantage of whatever savings will accrue from limiting access to the tuition-free public
schools to its own lawful residents, excluding even citizens of neighboring States.170
Denying a free education to illegal alien children is not a choice I would make
were I a legislator. Apart from compassionate considerations, the long-range costs of
excluding any children from the public schools may well outweigh the costs of educating
them. But that is not the issue; the fact [457 U.S. 253] that there are sound policy
arguments against the Texas Legislature's choice does not render that choice an
unconstitutional one.171 II
The Constitution does not provide a cure for every social ill, nor does it vest
judges with a mandate to try to remedy every social problem. Moreover, when this
Court rushes in to remedy what it perceives to be the failings of the political processes, it
deprives those processes of an opportunity to function. When the political institutions are
not forced to exercise constitutionally allocated powers and responsibilities, those
powers, like muscles not used, tend to atrophy. Todays cases, I regret to say, present yet
another example of unwarranted judicial action which, in the long run, tends to contribute
to the weakening of our political processes.173
170 [I assume no Member of the Court would challenge Texas' right to charge tuition to students residing
across the border in Louisiana who seek to attend the nearest school in Texas.]
171 [In support of this conclusion, the Court's opinion strings together quotations drawn from cases
addressing such diverse matters as the right of individuals under the Due Process Clause to learn a foreign
language, Meyer v. Nebraska, 262 U.S. 390 (1923); the First Amendment prohibition against state-
mandated religious exercises in the public schools, Abington School District v. Schempp, 374 U.S. 203
(1963); and state impingements upon the free exercise of religion, Wisconsin v. Yoder, 406 U.S. 205
(1972). However, not every isolated utterance of this Court retains force when wrested from the context in
which it was made.]
172 Lindsey v. Normet, 405 U.S. p. 74. See Reynolds v. Sims, 377 U.S. 533, 624 625 (1964) (Harlan, J.,
dissenting).
173 [Professor Bickel noted that judicial review can have a tendency over time seriously to weaken the
democratic process. A. Bickel, The Least Dangerous Branch 21 (1962). He reiterated James Bradley


33
a renunciation of foreign citizenship and loyalty. Congress then gave the President the
power to deport foreign revolutionaries under a 1798 alien act. In 1802, Congress
changed the period required for naturalization to five years.
The fight against illegal immigration began in 1875 when the United States
established its first law limiting immigration, which prohibited the entrance of convicts
and prostitutes.13 Then in 1882, Congress established legal limits on immigration
excluding Asian immigration.14 The 1882 law also solidified the establishment of the
United States Constitution as the supreme law of the land.15
In 1907, Congress set up an immigration commission (Dillingham Commission)
to study the growing immigration concerns of the general public. The main concerns of
those pushing for immigration controls were the assimilability of the new immigrants,
their sheer numbers, and their effect on the nations politics, language and culture.16 The
commissions investigationthe most exhaustive study of immigration in American
historyoriginated in response to calls to curtail immigration from Japan and southern
and eastern Europe. In 1911, the Dillingham Commission eventually recommended
restrictive changes to Americas immigration laws.17
12 Lawrence G. Brown, Immigration: Cultural Conflicts and Social Adjustments 267 (1969).
13 Vail, No Entry pp. 22-25.
14 Chinese Exclusion Act, ch.126, 22 Stat. 58, 1882.
15 U.S. Constitutions, Art. VI, cl.2.
16 Thomas A. Aleinikoff, and David Martin, Immigration: Process and Policy, 1-42 (interim 2d ed. 1991).
17
Ibid.


11
from o.3 million to 2.2 million in Texas.39 The foreign-bom population in these three
states combined rose from 1.9 million to 12.6 million, and the increase of 10.7 million
represented 67 percent of the growth of the foreign-bom population in the United States.
During the period from 1960 to 1997, these three states accounted for 41 percent of the
growth in total population.40
Illegal Immigration
The U.S. Supreme Court in 1982, by a 5 to 4 ruling, invalidated a 1975 Texas
State Statute which withheld from local school districts any state funds for the education
of children who were not legally admitted into the United States, and which authorized
local school districts to deny enrollment to such children.41 The ruling in Plyler v. Doe 42
held that illegal immigrant children were entitled to an education since they were not
responsible for their immigration status and were covered by the Equal Protection Clause
of the Fourteenth Amendment to the constitution, which prohibited states from denying
any person equal protection under the laws.43
The court recognized the importance of education to individuals and our nation
and concluded that the denial of education to this class of students could be justified only
if it advanced a substantial state goal. The state offered several justifications for its law,
39 U.S. Census Bureau, Profile of the Foreign-Born Population of the United States: 1997.
40 Ibid.
41 Texas Education Code Ann 21.031 (Vernon Supp.1981).
42 Plyler v. Doe, 457 U.S. 202 (1982).
43 Joseph Perkins, The San Diego Union-Tribune, June 11, 1997, B-9, pg 2. Constitutional scholars said
that neither Congress nor the state legislatures intended for the 14th Amendment to apply to the children of
undocumented immigrants. That was because, when the amendment was originally proposed 130-some
years ago, the United States had a defacto open border policy. There could be no illegal immigration.


150
event, the discrimination embodied in the statute was not supported by a rational basis.11
The District Court also concluded that the Texas statute violated the Supremacy Clause.12
The Court of Appeals for the Fifth Circuit upheld the District Court's injunction.13
The Court of Appeals held that the District Court had erred in finding the Texas statute
preempted by federal law. With respect to [457 U.S. 209] equal protection, however, the
Court of Appeals affirmed in all essential respects the analysis of the District Court,14
concluding that 21.031 was constitutionally infirm regardless of whether it was tested
using the mere rational basis standard or some more stringent test, 15 We noted probable
jurisdiction.16
During 1978 and 1979, suits challenging the constitutionality of 21.031 and
various local practices undertaken on the authority of that provision were filed in the
United States District Courts for the Southern, Western, and Northern Districts of Texas.
Each suit named the State of Texas and the Texas Education Agency as defendants, along
with local officials.17 In November 1979, the Judicial Panel on Multi-district Litigation,
Ibid., p.585.
12 Ibid., pp. 590-592. [The court found 21.031 inconsistent with the scheme of national regulation under the
Immigration and Nationality Act, and with federal laws pertaining to funding and discrimination in
education. The court distinguished De Canas v. Bica, 424 U.S. 351 (1976), by emphasizing that the state
bar on employment of illegal aliens involved in that case mirrored precisely the federal policy, of protecting
the domestic labor market, underlying the immigration laws. The court discerned no express federal policy
to bar illegal immigrants from education. 458 F.Supp. pp. 590-592. Ed.]
13 628 F.2d 448 (1980).
14 Ibid., pp. 454-458.
15 Ibid., p. 458.
16 451 U.S. 968 (1981). No. 8194 In re: Alien Children Education Litigation
17 [The Court of Appeals noted that De Canas v. Bica, had not foreclosed all state regulation with respect to
illegal aliens, and found no express or implied congressional policy favoring the education of illegal aliens.
The court therefore concluded that there was no preemptive conflict between state and federal law. 628
F.2d pp. 451-454. Ed.]


LIST OF FIGURES
Figure page
1-1 School-Age Immigrant Population 15
2-1 U.S. Foreign-Bom Population 43
3-1 Top Ten States Where Illegal Aliens Reside 72
4-1 Estimated Undocumented Immigrant Population in Florida in 1993
by Country of Origin Here is a figure 112
vm


65
For similar reasons, some lawmakers saw the denial of public benefits as a
demonstration of governmental disapproval or even resolve. Without restrictions, it was
argued, the government was sending mixed signals. Restrictions confirmed that the
government took its immigration laws seriously.20
All of these arguments were legitimate, and most people agreed that the
government should not extend to undocumented immigrants the full range of benefits
available to those who were here legally. However, few people denied that services such
as police or fire protection, or emergency medical care were necessary. If pressed, most
people thought that undocumented immigrants should receive some benefits but not
others. So, the question was where to draw the line.21
In addressing the question, various arguments for extending certain benefits to
undocumented immigrants were considered. It was not a reasonable assumption to
believe that all undocumented immigrants were wrongdoers. Until their cases were
adjudicated, their legal status was not settled. Many undocumented immigrants had
asylum claims pending for a considerable length of time. Others had legitimate reasons to
be in the United States. Further, whatever moral conclusions one reached with respect to
adult undocumented immigrants, children were not viewed as morally culpable for
accompanying their parents to the United States rather than staying behind,
unaccompanied.22
20 Ibid.
21 Ibid.
22
Ibid.


126
Summary
With the influx of immigrants since the 1960s, and the rapid changes in the ethnic
composition of Americas population and the school population, a growing need to see
that all were educated became pressing. Based on the educational foundations of the
nineteenth and twentieth centuries (Tocqueville, Mann and Dewey) we would have
seriously considered and more than likely have seen the importance of, including all
children in the free public education process.
Meeting the needs of the immigrant student demanded utilizing all the means
necessary to assimilate him/her and to make that student the most productive,
contributing member to the economy and American society. In determining the needs of
the immigrant student, one would have considered what was best for taxpayers, what was
best for non-immigrant children and what was best for the school system and society in
general, in the delivery of quality, cost effective instruction to the school-aged citizenry.
Enlightened, moral state policies had to find a way to balance the disparate, often
competitive, ethical considerations from the various points of view, and constituencies.


113
costs of immigrants to the state, which led the state to sue unsuccessfully the federal
government for additional remuneration.44 The Supreme Court ruled that the dispute
between Florida, along with other states heavily impacted by immigration, and the federal
government was a policy issue that must be settled by Congress, which is responsible for
creating the nations immigration laws.
Education Rights of Undocumented Immigrant Students
A free public elementary and secondary education was a right granted to each
child in the United States. Federal mandate was augmented by state educational statutes,
which required each child be given equal opportunity to receive a suitable program of
educational experiences. The state educational statutes implemented and supplemented
the federal mandates, and ensured an equal educational opportunity for all children.45
All children have dealt with stressful events as they matured. Immigrant students,
however, faced additional challenges.46 The most distressing included violence (often a
result of warfare or civil strife in their native lands) and separation from family members.
Other stresses included adaptation to a new culture, the challenge of learning a new
language, and often, the insult of racial discrimination in this country.47 Many immigrant
families had a difficult time simply making ends meet; many led lives of poverty in urban
areas.
44 Chiles v. U.S., 95-1249.
45 Cynthia McDaniels, Equality of Educational Opportunity: Race and Finance in Public Education, The
Constitution. Courts and Public Schools. Vol.l, 1992, Yale-New Haven Teachers Institute, Conn.
46 J. Willshire Carrera, Immigrant Students: Their Legal Right Of Access To Public Schools: A Guide For
Advocates And Educators, Boston, MA, (National Coalition of Advocates for Students, 1989b).
47
Ibid.


173
classifications. Still others have suggested that fundamental rights are not properly a
part of equal protection analysis at all, because they are unrelated to any defined principle
of equality.90
These considerations, combined with doubts about the judiciary's ability to make
fine distinctions in assessing the effects of complex social policies, led the Court in
Rodriguez to articulate a firm rule: fundamental rights are those that explicitly or
implicitly [are] guaranteed by the Constitution.91 It therefore squarely rejected the
notion that an ad hoc determination as to the social or economic importance of a given
interest is relevant to the level of scrutiny accorded classifications involving that interest,
and made clear that it is not the province of this Court to create substantive
02
constitutional rights in the name of guaranteeing equal protection of the laws.
I joined JUSTICE POWELL's opinion for the Court in Rodriguez, and I continue
to believe that it provides the appropriate model for resolving most equal protection
disputes. Classifications infringing substantive constitutional rights necessarily will be
invalid, if not by force of the Equal Protection Clause, then through operation of other
provisions of the Constitution. Conversely, classifications bearing on nonconstitutional
interests even those involving the most basic economic needs of impoverished human
beings,93 -- generally are not subject to special treatment under the Equal Protection
89 San Antonio Independent School District v. Rodriguez A11 U.S. 1, 61 (1973) (Stewart, J., concurring).
See Shapiro v. Thompson, 394 U.S. p. 659 (Harlan, J., dissenting).
90 Perry, Modem Equal Protection: A Conceptualization and Appraisal, 79 Colum.L.Rev. pp.1023, 1075-
1083(1979).
91 411 U.S.pp. 33-34.
92 Ibid., pp. 32-33.
93 Dandridge v. Williams, 397 U.S. 471, p. 485 (1970).


165
United States, and the evasion of the federal regulatory program that is the mark of
undocumented status, provides authority for its decision to impose upon them special
disabilities. Faced with an equal protection challenge respecting the treatment of aliens,
we agree that the courts must be attentive to congressional policy; the exercise of
congressional power might well affect the State's prerogatives to afford differential
treatment to a particular class of aliens. But we are unable to find in the congressional
immigration scheme any statement of policy that might weigh significantly in arriving at
an equal protection balance concerning the State's authority to deprive these children of
an education.58
The Constitution grants Congress the power to establish an uniform Rule of
Naturalization.59 Drawing upon this power, upon its plenary authority with respect to
foreign relations and international commerce, and upon the inherent power of a sovereign
to close its borders, Congress has developed a complex scheme governing admission to
our Nation and status within our borders.60 The obvious need for delicate policy
judgments has counseled the Judicial Branch to avoid intrusion into this field.61 But this
traditional caution does not persuade us that deference must be shown the classification
embodied in 21.031. The States enjoy no power with respect to the classification of
aliens. This power is committed to the political branches of the Federal government.
58 457 U.S. 225.
59 Art. I., 8, cl. 4.
60 Mathews v. Diaz, 426 U.S. 67 (1976); Harisiades v. Shaughnessy, 342 U.S. 580, 588-589 (1952).
61 Mathews, p. 204.
62 Hines v. Davidowitz, 312 U.S. 52 (1941).
63 Mathews, 426 U.S. p. 166.


169
and tax money to the state fisc.76 The dominant incentive for illegal entry into the State
of Texas is the availability of employment; few if any illegal immigrants come to this
country, or presumably to the State of Texas, in order to avail themselves of a free
education.77 Thus, even making the doubtful assumption that the net impact of illegal
aliens on the economy of the State is negative, we think it clear that charging tuition to
undocumented children constitutes a ludicrously ineffectual attempt to stem the tide of
illegal immigration, at least when compared with the alternative of [457 U.S. 229]
no
prohibiting the employment of illegal aliens.
Second, while it is apparent that a State may not... reduce expenditures for
education by barring [some arbitrarily chosen class of] children from its schools,79
appellants suggest that undocumented children are appropriately singled out for exclusion
because of the special burdens they impose on the State's ability to provide high-quality
public education. But the record in no way supports the claim that exclusion of
undocumented children is likely to improve the overall quality of education in the State.80
As the District Court in No. 801934 noted, the state failed to offer any credible
supporting evidence that a proportionately small diminution of the funds spent on each
76 458 F.Supp. p. 578; 501 F.Supp. pp. 570-571.
77 [The courts below noted the ineffectiveness of the Texas provision as a means of controlling the influx of
illegal entrants into the State. See 628 F.2d pp. 460-461; 458 F.Supp. p. 585; 501 F.Supp. p. 578 (The
evidence demonstrates that undocumented persons do not immigrate in search for a free public education.
Virtually all of the undocumented persons who come into this country seek employment opportunities, and
not educational benefits.... There was overwhelming evidence ... of the unimportance of public
education as a stimulus for immigration.). Ed.]
78 458 F.Supp. p. 585. See 628 F.2d p. 461; 501 F.Supp. p. 579, and n. 88.
79 Shapiro v. Thompson, 394 U.S. 618, 633 (1969).
80 Ibid., pp. 579-581. [Nor does the record support the claim that the educational resources of the State are
so direly limited that some form of educational triage might be deemed a reasonable (assuming that it
were a permissible) response to the State's problems. Ed.]


This dissertation was submitted to the Graduate Faculty of the College of
Education and to the Graduate School and was accepted as partial fulfillment of the
requirements for the degree of Doctor of Philosophy.
August 2000
Dean, Graduate School


Table 1-1
Estimated Illegal Immigrant Population for Top Twenty Countries of
Origin and Top Twenty States of Residence: October 1996
13
Country of Origin
Population
State Of Residence
Population
All countries
5,000,000
All states
5,000,000
1. Mexico
2,700,000
1. California
2,000,000
2. El Salvador
335,000
2. Texas
700,000
3. Guatemala
165,000
3. New York
540,000
4. Canada
120,000
4. Florida
350,000
5. Haiti
105,000
5. Illinois
290,000
6. Philippines
95,000
6. New Jersey
135,000
7. Honduras
90,000
7. Arizona
115,000
8. Poland
70,000
8. Massachusetts
85,000
9. Nicaragua
70,000
9. Virginia
55,000
10. Bahamas
70,000
10. Washington
52,000
11. Colombia
65,000
11. Colorado
45,000
12. Ecuador
55,000
12. Maryland
44,000
13. Dom. Republic
50,000
13. Michigan
37,000
14. Trinidad/Tobago
50,000
14. Pennsylvania
37,000
15. Jamaica
50,000
15. New Mexico
37,000
16. Pakistan
41,000
16. Oregon
33,000
17. India
33,000
17. Georgia
32,000
18. Dominica
32,000
18. District of Columbia
30,000
19. Peru
30,000
19. Connecticut
29,000
20. Korea
30,000
20. Nevada
24,000
Other
744,000
Other
330,000
Source: Illegal Resident Population, Immigration and Naturalization Service, 1997.
Estimating the size of a hidden population was inherently difficult. The
figures presented here reflect the size, origin, and geographic distribution
of the undocumented immigrant population residing in the United States
during the mid-1990s. These estimates were constructed by combining
detailed statistics, by year of entry, for each component of change that
contributed to the undocumented immigrant population residing within the
state.46
46
Illegal Alien Resident Population 23 November 1997.


17
education, social services and health carealong with complementary provisions
mandating that local law enforcement authorities, school administrators, social workers,
and health-care aides turn in suspected undocumented immigrants.57 Other opponents
of the measure argued that it was unconstitutional, citing the 1982 Plyler v. Doe Supreme
Court decision.58 That decision centered on the view that the state had enacted an
immigration-related law, whereas the federal government, which had not acted on the
issue, had exclusive jurisdiction.59
Societal Impact
One of the most controversial political and economic issues in the United States at
the time was the influence immigrants entering the country had on society. Some people
categorized immigrants as an uneducated, unskilled burden on our economy that took
advantage of many of the government funded programs established for the benefit of U.S.
citizens. Opponents of the U.S. policy on immigration believed that drastic steps
needed to be taken to curb the number of immigrants entering the United States.60
Politicians expressed their willingness to support measures that would close the borders
and deny children of undocumented workers an education. After California voters passed
Proposition 187,61 other states attempted to restrict undocumented alien access to
government-funded programs.62
57 Federal Judge: Proposition 187 Unconstitutional. Stage Set for Appeal of Anti-immigrant Initiative,
Los Angeles Times, 5A, November 15, 1997.
58 Plyler v. Doe, 457 U.S. 202 (1982).
59 Chinese Exclusion Act, ch.126,22 Stat.58, 1882 (formerly codified in scattered parts of 8 U.S.C. ch.7).
60 57 Cal. AppA* 693.
61 Ibid.


193
excluding illegal alien residents of a state from such programs so as to preserve the states
finite revenues for the benefit of lawful residents.166
The Court maintains as if this were the issue that "barring undocumented
children from local schools would not necessarily improve the quality of education
provided in those [457 U.S. 252] schools."167 However, the legitimacy of barring illegal
aliens from programs such as Medicare or Medicaid does not depend on a showing that
the barrier would improve the quality of medical care given to persons lawfully entitled
to participate in such programs.168 Modem education, like medical care, is enormously
expensive, and there can be no doubt that very large added costs will fall on the State or
its local school districts as a result of the inclusion of illegal aliens in the tuition-free
public schools. The State may, in its discretion, use any savings resulting from its tuition
requirement to improve the quality of education in the public school system, or to
enhance the funds available for other social programs, or to reduce the tax burden placed
on its residents; each of these ends is legitimate. The State need not show, as the
Court implies, that the incremental cost of educating illegal aliens will send it into
bankruptcy, or have a rave impact on the quality of education, that is not dispositive
under a rational basis scrutiny.166 In the absence of a constitutional imperative to
provide for the education of illegal aliens, the State may rationally choose to take
166 Mathews v. Diaz, 426 U.S. p. 80; see also n. 7.
167 Ibid., p. 229. 458 F.Supp. 569,577 (ED Tex. 1978).
168 [The District Court so concluded primarily because the State would decrease its funding to local school
districts in proportion to the exclusion of illegal alien children. 458 F.Supp. p. 577.]
169 [This rational basis standard was applied by the Court of Appeals. 628 F.2d 448,458-461 (1980).]


The 1965 Immigration Act 40
Immigration Policy After 1965 42
Educating Illegal Immigrant Children 44
Summary 59
3 IMMIGRATION LAWS AND PROPOSITION 187 61
Introduction 61
Background 61
Immigration Laws 66
Illegal Aliens 69
Proposition 187 74
Constitutional Violations 77
Conflict with Federal Laws 80
Due Process 82
Immigration and Education 84
Florida Immigration and Education 90
Summary 97
4 FINANCIAL AND ETHICAL CONSIDERATIONS 99
Introduction 99
Legal Basis for States' Responsibilities 99
Education Finance 103
Florida Education Finance 108
Population Data Ill
Educational Rights of Undocumented Immigrant Students 113
Immigrant Students 116
Ethics and the Democracy of Education 119
Educating All Children 122
Summary 126
5 IMMIGRATION EDUCATION POLICY INCLUSIONS FOR THE STATE
OF FLORIDA 127
Introduction 127
The Right to Learn 127
Distinctions 128
Immigration Facts 128
Federal Policies and Laws 129
Florida Legislation 133
Florida School Laws 134
Florida's Education Strategic Priorities 136
Policy Enhancements 137
Summary 143
v


20
The results of this study indicated that the children of immigrants were unlikely to
develop into an underclass, as some experts feared, cut off by academic failure and an
inability to speak English. But the researchers also found it was uncertain how well the
children of immigrants, who made up 20 percent of all children in the U.S., would do in
college and in the job market.73
The research team, led by sociologists Ruben Rumbaut of Michigan State
University and Alejandro Protes of Princeton University, first interviewed 5,200 eighth
and ninth graders in San Diego and South Florida in 1992. They located 82 percent of
the initial sample for a second interview in 1995 and 1996.74
The research found that the children of Chinese, Indian, Japanese and Korean
parents got the best grades, an average of A's and B's. English speaking West Indians
had lower grades, Cs and C+, while Latin American and Haitian youths performed most
poorly, with averages that were slightly higher or lower than a C.75
But a few groups defied what would have been expected based on their
socioeconomic status. The children of Southeast Asian refugees, who came from the
most impoverished background and whose parents were among the least educated, were
also among the least likely to drop out and had above average grades. And the children
of Cuban immigrants, who were from average to above-average socioeconomic
backgrounds, had the highest dropout rates and among the lowest grades, the survey
reported. The Cuban children, who belonged to the dominant group in Metropolitan
73 Ibid.
74 Ibid.
75
Ibid.


Abstract of Dissertation Presented to the Graduate School
of the University of Florida in Partial Fulfillment of the
Requirements for the Degree of Doctor of Philosophy
IMMIGRATION AND EDUCATION LEGISLATION
AND ITS EFFECTS ON POLICIES RELATING TO
UNDOCUMENTED IMMIGRANT CHILDREN
By
ROSE ALVINE RASKA
August 2000
Chairman: David S. Honeyman
Major Department: Educational Leadership, Policy, and Foundations
The need for an effective public policy regarding the education and assimilation of illegal
immigrant children had become the topic of many discussions. Beginning with the Plyler
decision in Texas in 1982, Californias Proposition 187 and the Gallegly amendment in
1996, attempts were made to legislate such policy. Florida had the fourth largest
percentage of illegal immigrant population in the United States. Along with that, the
fourth largest number of illegal immigrant children, which we had a moral, if not legal,
obligation to educate. Educating immigrant children to the ways of our society, along
with English and mathematics, provided long-term benefits in terms of both successful
citizenship and cost effectiveness. States needed to develop immigrant education policies
that provided equitable opportunities for all children. Much research had been done on
IX


166
Although it is a routine and normally legitimate part of the business of the Federal
Government to classify on the basis of alien status, and to take into account the character
of the relationship between the alien and this country, only rarely are such matters
relevant to legislation by a State.64
As we recognized in De Canas v. Bica,65 the States do have some authority to act
with respect to illegal aliens, at least where such action mirrors federal objectives and
furthers a legitimate state goal. In De Canas, the State's program reflected Congress
intention to bar from employment all aliens except those possessing a grant of permission
to work in this country.66 In contrast, there is no indication that the disability imposed by
21.031 corresponds to any identifiable congressional policy. The State does not claim
that the conservation of state educational resources was ever a congressional concern in
restricting immigration. More importantly, the classification reflected in 21.031 does not
operate harmoniously within the federal program.67
To be sure, like all persons who have entered the United States unlawfully, these
children are subject to deportation.68 But there is no assurance that a child subject to
deportation will ever be deported. An illegal entrant might be granted federal permission
to continue to reside in this country, or even to become a citizen.69 In light of the
discretionary federal power to grant relief from deportation, a State cannot realistically
64 Ibid., pp. 84-85; Nyquist v. Mauclet, 432 U.S. 1, 7, n. 8 (1977).
65 424 U.S. 351 (1976).
66 Ibid., p. 361.
67 457 p. 226.
68 8 U.S.C. 1251, 1252 (1976 ed. and Supp. IV).


91
Florida sued the federal government in 1994, saying it had failed to protect the
state from a massive and uncontrolled influx of aliens and had coerced the state into
paying the cost of national immigration policy."2
Florida lost the Supreme Court appeal intended to improve federal enforcement
of immigration laws or repay the state's cost of providing social services and education to
illegal aliens. The court, without comment, refused to revive the state's claim that the
federal government had violated its duty to police the nation's borders.113
Florida maintained that the federal government had a policy of accommodating
illegal immigration that cost the state hundreds of millions of dollars in extra expenses
each year for education, medical care, and law enforcement. State officials estimated that
Florida had spent $1.5 billion on undocumented aliens while the federal government
collected almost $3.4 billion a year in taxes from such aliens. The state sued the federal
government in 1994, saying it had failed to protect Florida from a massive and
uncontrolled influx of aliens and coerced the state into paying the cost of national
immigration policy. 114
The lawsuit claimed the government had violated immigration law and the
Constitution's 10th Amendment, which reserved certain powers to the states. The lawsuit
also cited the Constitution's promise that the federal government would protect states
against invasions.115
112 Laurie Asseo, Florida Wont Be Compensated For Illegal Immigration, May 96,
.
113 Ibid.
114 Ibid.
115 Florida Wont Be Compensated For Illegal Immigration. 5/28/96 .


190
Once it is conceded -- as the Court does that illegal aliens are not a suspect
class, and that education is not a fundamental right, our inquiry should focus on and be
limited to whether the legislative classification at issue bears a rational relationship to a
legitimate state purpose.154 [457 U.S. 249]
The State contends primarily that 21.031 serves to prevent undue depletion of its
limited revenues available for education, and to preserve the fiscal integrity of the State's
school-financing system against an ever-increasing flood of illegal aliens aliens over
whose entry or continued presence it has no control. Of course such fiscal concerns alone
could not justify discrimination against a suspect class or an arbitrary and irrational
denial of benefits to a particular group of persons. Yet I assume no Member of this Court
would argue that prudent conservation of finite state revenues is, per se, an illegitimate
goal. Indeed, the numerous classifications this Court has sustained in social welfare
legislation were invariably related to the limited amount of revenues available to spend
on any given program or set of programs.155 The significant question here is whether the
requirement of tuition from illegal aliens who attend the public schools -- as well as from
residents of other states,156 for example is a rational and reasonable means of furthering
the states legitimate fiscal ends.157 [457 U.S. 250]
154 Vance v. Bradley, 440 U.S. 93,97 (1979); Dandridge v. Williams, 397 U.S. 471, (1970); p. 216.
155 Jefferson v. Hackney, 406 U.S. Dandridge v. Williams, p. 487.
156 [Appellees lack control over their illegal residence in this country in the same sense as lawfully
resident children lack control over the school district in which their parents reside. Yet in San Antonio
Independent School District v. Rodriguez, 411 U.S. 1 (1973), we declined to review under heightened
scrutiny a claim that a State discriminated against residents of less wealthy school districts in its provision
of educational benefits. There was no suggestion in that case that a childs lack of responsibility for his
residence in a particular school district had any relevance to the proper standard of review of his claims.
The result was that children lawfully here but residing in different counties received different treatment.]
157 [The Texas law might also be justified as a means of deterring unlawful immigration. While regulation
of immigration is an exclusively federal function, a state may take steps, consistent with federal


44
Educating Illegal Immigrant Children
Meyer v. Nebraska68 was a 1923 U.S. Supreme Court decision that overrode an
earlier Nebraska statue that barred individuals and schools from providing instruction in a
language other than English to any student who had not completed the eighth grade. The
defendant in Meyer was a teacher in a parochial school in a Lutheran church who taught
German language to a ten-year-old boy who had not passed the eighth grade. The text
used, a book of biblical stories written in German, was for the purpose of giving religious
instruction in English.69 Their plan, according to the pastor, was simply to have their
children learn enough German to be able to worship together as a family.
The Meyer decision put a stop to what had become a national trend. Nebraska had
passed its English-only statute in 1919, and fourteen other states had followed its lead.
Some had gone so far as to declare English (or American) to be their official language.
The decision in Meyer gave educators the right to use a language other than English in the
classroom.
The Refugee Act of 1980, provided funding for such programs as English for
Speakers of Other Languages (ESOL or ESL). This program allowed immigrant students
to be taught in their native language at a public school. The Consent Decree of 199071
mandated surveying immigrant students to determine their level of need for language
68 Meyer v. Nebraska 262 U.S. 390 (1923).
69 Ellis Cose, A Nation of Strangers: Prejudice, Politics and the Populating of America. New York: Wm.
Morrow & Company, Inc., 1992.
70 Refugee Act of March 17, 1980, Immigration and Nationality Act, [ 101(a)(42)(A)].
71 Florida Department of Education. (1996a). 1990 League of United Latin American Citizens (LULAC) et
al. v. State Board of Education Consent Decree. Tallahassee, FL: Office of Multicultural Student
Language Education.


3
Significance of the Research
Florida school districts were required to follow federal regulations and Supreme
Court guidelines in school admission requirements. Due to the sheer numbers of
undocumented immigrant students who resided in and continually entered the state, there
was a need for a precedent policy. This research proposed to analyze the historical
position of litigation concerning illegal immigration and the education of immigrant
children. This study was significant as an attempt to recommend policy inclusions for the
state of Florida on the education of the children of undocumented immigrants.
Statement Of The Problem
Since the 1982 Supreme Court decision in Plyler,3 which required free elementary
and secondary education for all children residing within a given state, the numbers of
immigrants both legal and illegal arriving in the state of Florida increased. An
assessment of the cost of providing special educational programming, along with meeting
equity provisions and equality concerns was essential.
With the increase of undocumented immigrant students in mind, the question of
the necessity for an illegal immigrant education policy for the state of Florida and the
ethical reasoning behind the education of the undocumented student was of interest. A
review of some American beliefs on education during the early twentieth century was
included.
3 Plyler v. Doe, 457 US 202 (1982).


LIST OF REFERENCES
Alexander, Kern and Alexander, M. David. American Public School Law, New York,
West Publishing Co., 1992, p 25.
Alienkoff, Thomas A. The Tightening Circle of Membership, 22 Hastings Const. L.Q.
915(1995).
Alienkoff, Thomas A. and Martin, David A. Immigration: Process and Policy, pp. 1-42
(interim 2d ed. 1991).
Alienkoff, Thomas A., Martin, David A. and Motomura, Hiroshi. (1998). Immigration
and Citizenship: Process and Policy. Fourth Edition. West Group, St. Paul,
Minn. (25 February 1997).
Annals of Congress, House of Representatives, 17th Congress, 2nd session, U.S.
Congressional Documents and Debates, 1774-1873.
Asseo, Laurie. Florida Wont Be Compensated For Illegal Immigration, May 96,
.
Bailyn, Bernard. Education in the Forming of American Society 49 (1960).
Bennett, Marion T. American Immigration Policies: A History (1963).
Boisvert, Raymond D. John Dewey: Rethinking Our Time, State University of New York
Press, Albany, NY. p. 95 (1998).
Brimelow, Peter. Alien Nation: Common Sense About America's Immigration Disaster,
Brown, Lawrence G. Immigration: Cultural Conflicts and Social Adjustments 267
(1969).
Bureau of The Census, U.S. Department Of Commerce, 1960 Census Of Population,
Characteristics Of The Population, pt. 1, at 145, tbl. 44 (1964).
Bureau of the Census, U.S. Department of Commerce, 1990 Census of Population,
General Population Characteristics, 323 tbl. 253 (1992).
196


135
(1)
(a)All children who have attained the age of 6 years
or who will have attained the age of 6 years by
February 1 of any school year or who are older
than 6 years of age but who have not attained
the age of 16 years, except as hereinafter
provided, are required to attend school regularly
during the entire school term.
(0 Homeless children, as defined in s. 228.041,
must have access to a free public education and
must be admitted to school in the school district
in which they and their families live. School
districts shall assist homeless children to meet
the requirements of §. 232.03, 232.03115, and
232.032, as well as local requirements for
documentation.22
233.058 English Language Instruction for limited English
proficient students.
(1) Instruction in the English language shall be provided to
limited English proficient students. Such instruction shall
be designed to develop the students mastery of the four
language skills, including listening, speaking, reading, and
writing, as rapidly as possible. Limited English proficient
students who are eligible other categorical or special
programs, such s Chapter I and exceptional student
education, shall also participate in such services in
accordance with the requirements of the respective
program.23
(3) Each school district shall implement the following procedures:
(a) Develop and submit a district plan for providing
English language instruction for limited English
proficient students to the Department of
Education for review and approval.
(b) Identify limited English students through
assessment.
(c) Provide for student exit from and
reclassification into the program.
(d) Provide limited English proficient students
ESOL instruction in English and ESOL
22 Florida Department of Education, Florida School Laws, Chapter 228-246 Florida Statutes, 1999.
23
Ibid.


101
on the basis of race, color, or national origin in institutions with federally assisted
programs. The Court held that giving students the same textbooks, teachers, and
curriculum did not provide equal opportunities. Further, requiring children to acquire
English skills on their own before they could hope to make any progress in school made
a mockery of public education.5 Emphasizing that basic English skills were at the
very core of what these public schools teach, the Court concluded students who did not
understand English were effectively foreclosed from any meaningful education.6
In a number of subsequent cases, the courts consistently ruled that English-
deficient students were entitled to special assistance in public schools. The federal Equal
Educational Opportunities Act (EEOA) of 19747 provided that no state could deny equal
educational opportunity to an individual on account of his or her race, color, sex, or
national origin.8 It additionally required each public school system to develop
appropriate programs to overcome language barriers that impeded equal participation by
its students in its instructional program.9 While EEOA stipulated that school districts
must provide appropriate assistance for students with English deficiencies, it did not
require that such assistance be in the form of bilingual/bicultural education. Based on
these decisions, school districts could satisfy legal requirements by providing remedial
English instruction rather than bilingual programs.
5 Lau v. Nichols, 414 U.S., p. 566.
6 Ibid.
7 Equal Education Opportunities Act of 1974 (EEOA) at 20 U.S.C. 1703.
8 20 U.S. C. § 1703(f).
9 Ibid.


84
It made little sense for Congress to legislate in the areas of immigration and
public assistance without reviewing the precedent immigration laws and policies under
which the affected aliens were here; and the reduction in federal programs was no saving
if it simply shifted their costs to the states and communities where the aliens and their
families lived.90
Immigration And Education
Many states, particularly those with the highest percentages of illegal immigrants
were concerned over the expenses they incurred by providing public social services and
educational benefits to illegal immigrants. Only the federal government could enact
immigration policy,91 to which states must adhere. Some state challenges to federal
immigration policy focused considerable public interest on the immigration issue, both
legal and illegal, and the lack of adequate funding to carry out the required mandates of
the policies.
Because the federal courts made immigration legislation, the states had the
obligation to follow the mandates. Little if any funding followed policy, often leaving
the states with the largest numbers of legal as well as illegal immigrants, with more than
their share of the overwhelming costs of educating the children.
In the wave of anti-immigrant sentiment, other states had made proposals to bar
undocumented immigrant students from attending public schools, counter to federal
efforts to keep students in school rather than out. Virginia, for instance, required its
90 See Plyler v. Doe, 457 U.S. 202, 225 (1982). Cf. DeCanas v. Bica, 424 U.S. 351(1976).
91
Ibid.


144
of government,35 and as the primary vehicle for transmitting the values on which our
society rests.36
Early in our history, some degree of education was necessary to prepare citizens
to effectively and intelligently participate in our open political system if we were to
preserve freedom and independence.37 These historic perceptions of the public schools as
instilling the fundamental values necessary to the maintenance of a democratic political
system were confirmed by the observations of social scientists. In addition, education
provided the basic tools by which individuals might lead economically productive lives to
the benefit of us all. In sum, education had a fundamental role in maintaining the fabric
of our society. We did not ignore the significant social costs borne by our Nation when
select groups were denied the means to absorb the values and skills upon which our
social order rests.39
While most children of immigrants were doing well, a portion was indeed falling
through the cracks. The population that continued to have limited English proficiency
(LEPs), was, as a group, not simply less capable linguistically than other students.
Rather, they belonged to a different and more vulnerable group than the majority of their
peers. They had one or both parents unemployed, parents who may have entered the
country illegally, lived in poorer neighborhoods, were more likely to have grown up in
female-headed households and households with higher levels of conflict, and tended to be
35 Abington School District v. Schempp, 374 U.S. 203, 230 (1963) (BRENNAN, J., concurring).
36 Ambach v. Norwick, 441 U.S. 68, 76 (1979).
37 Wisconsin v. Yoder, 406 U.S. 205, 221 (1972).
38 Ambach v. Norwick, 441 U.S. 68, 76 (1979).
39 Plyler v. Doe, 457 US 202 (1982).


49
The Court recognized that education was not a right the constitution granted
O 1
individuals. Additionally, the Court rejected the premise that the children comprised of
a suspect class qualified for full rights as Americans. Illegal alien children, unlike
members of racial groups, were not a protected subclass because their classification
resulted from voluntary criminal decisions on the part of their parents to reside in the
United States. Yet, the Court referred to the role American education played in
transmitting our American values and maintaining the democratic nature of our
political system.83 The Court stated: We have recognized the public schools as a most
vital civic institution for the preservation of a democratic system of government,... and
as the primary vehicle for transmitting the values on which our society rests, ... In
sum, education has a fundamental role in maintaining the fabric of our society.84
The Plyler Court used our in a very special sense. The Court implied that in
1982 there was an our on which most could basically agree and which encompassed
political, social, and educational values.
The Courts majority determined that equal protection under the Fourteenth
Amendment was not confined to the protection of citizens. Both the equal protection
and the due process clauses of the Constitution, the court declared, are Universal in their
application, to all persons within the territorial jurisdiction, without regard to any
81 Plyler, 457 U.S. at 221 (citing San Antonio Independent School District v. Rodriguez, 411 U.S. 1, 35
[1973]).
82 Ibid., p. 223.
83 Ibid., pp. 221-223.
84 Ibid., p. 221.


45
services in order to learn English and to provide those services as part of the education
program.
Immigration policy up to 1965, did not address the aspect of educating the
children of immigrants, legal or illegal. Each state had their own laws (or none)
regarding the education of immigrants and other suspect classes. The education of
illegal immigrant children did not become an issue until the decade of the 1970s in Texas,
and then it became a problem.
Plyler v. Doe12 represented the epitome of confidence in Americas assimilative
capacity. The United States Supreme Court held that states could not deny a free public
education to the foreign bom children of illegal immigrants. In Plyler, the Court
considered the Texas statute74 prohibiting state-funded public education to children of
illegal aliens. James Plyler was the Superintendent of the Tyler Independent School
72 Plyler, 457 U.S. at 202 (1982).
73 Ibid., p. 230.
74 TEXAS EDUCATION CODE ANN. § 21.03 (Vernon Supp. 1981) cited in Plyler, 457 U.S. at 201 n.l.
(a) All children who are citizens of the United States or legally admitted aliens and who are over
the age of five years and under the age of 21 years on the first day of September of any
scholastic year shall be entitled to the benefits of the Available School Fund for that year.
(b) Every child in this state who is a citizen of the United States or a legally admitted alien and
who is over the age of five years and not over the age of 21 years on the first day of September
of the year in which admission is sought shall be permitted to attend the public free schools of
the district in which he resides or in which his parent, guardian, or the person having lawful
control of him resides at the time he applies for admission.
(c) The board of trustees of any public free school district of this state shall admit into the public
free schools of the district free of tuition all persons who are either citizens of the United
States or legally admitted aliens and who are over five and not over 21 years of age at the
beginning of the scholastic year if such persons or his parent, guardian or person having lawful
control resides within the school district.


16
In considering the educational needs of students learning English, a look at the
past proved to be judicious. At the turn of this century, a peak time for United States
immigration, educational achievement was not the key factor in determining economic
success. A strong back and willing hands were as important as the ability to read and
write. During that period, it often took three generations for families to move into the
American mainstream. Less than 100 years later, manual labor had little economic value.
As the value of physical labor diminished, the expectations for effective communication
and literacy increased. Students were not only required to have at least a high school
diploma, they were required to be fully literate in English, to understand academic
subjects and to know how to use technology. Instead of waiting generations for their
families to acculturate to the mainstream, students were expected to assimilate into the
mainstream within a matter of a few years.55
The relationship of immigration and education became a heated policy issue in
1994 due to a California proposal to deny taxpayer-financed education to illegal alien
children. California's Proposition 187,56 which restricted government funded programs
from serving illegal immigrants, passed in 1994 by a significant majority. A federal
judge froze implementation of the provision in November 1997. Judge Mariana Pfailzer
declared that it violated both the Constitution and the Personal Responsibility and Work
Opportunity Reconciliation Act of 1996. The judge cited as unlawful the initiative's
major sectionsthose barring undocumented immigrants from receiving publicly funded
54 Ibid.
55 Sandra H. Fradd and Okhee Lee, eds., 1998. Creating Florida's Multilingual Workforce, Miami, Custom
Copy and Printing.
56 57 Cal. App.4th 693.


CHAPTER 1
INTRODUCTION
This examination of the history of immigration and education legislation in the
United States reveals the change process that law and policy underwent through the
years. It takes into account both, immigration to the United States and the immigrants
themselves. Immigration policies were made at the federal level and addressed broad
issues such as quotas and enforcement of immigrant parameters. Immigrant policies, on
the other hand, were made at the state level and focused on immigrants already residing
in the United States. Immigrant policy makers dealt with how to integrate immigrants
into the American population and assist them with public benefits during the transition.1
As a nation whose ancestors were all immigrants, much of historical U.S. foreign
policy invited foreigners into the country. When immigrant limits and control of U.S.
borders became an issue, so did educating the legal and illegal immigrant student
population. Laws were passed to control immigration and those who broke the laws in
order to enter the U.S. became illegal immigrants. Through no fault of their own, their
children were in a country where they were not official residents and needed to be
educated.
1 Roco Del Sagrario Toriz , Federal and State
Responsibility for Undocumented Immigration, Berkeley McNair Journal Three, no. Summer 1995 (1995)
.
1


184
The Court makes no attempt to disguise that it is acting to make up for Congress
lack of effective leadership in dealing with the serious national problems caused by the
influx of uncountable millions of illegal aliens across our borders.133 The failure of
enforcement of the immigration laws over more than a decade and the inherent difficulty
and expense of sealing our vast borders have combined to create a grave socioeconomic
dilemma. It is a dilemma that has not yet even been fully assessed, let alone addressed.
However, it is not the function of the Judiciary to provide effective leadership simply
because the political branches of government fail to do so.
The Court's holding today manifests the justly criticized judicial tendency to
attempt speedy and wholesale formulation of remedies for the failures or simply the
laggard pace of the political processes of our system of government. The Court
employs, and, in my view, abuses, the Fourteenth Amendment in an effort to become an
omnipotent and omniscient problem solver. That the motives for doing so are noble
and compassionate does not alter the fact that the Court distorts our constitutional
function to make amends for the defaults of others.
In a sense, the Court's opinion rests on such a unique confluence of theories and
rationales that it will likely stand for little beyond the results in these particular cases.
Yet the extent to which the Court departs from principled constitutional adjudication is
nonetheless disturbing.
I have no quarrel with the conclusion that the Equal Protection Clause of the
Fourteenth Amendment applies to aliens who, after their illegal entry into this country,
are indeed physically within the jurisdiction of a state. However, as the Court
133
[457 U.S. 243] (POWELL, J concurring).


73
conditions. In fact, law enforcement officials reported that sweatshops operating outside
the law in the garment industry made a comeback in Los Angeles and New York City
thanks to the availability of illegal alien labor.
The courts had long prohibited the states from discriminating against legal
immigrants, largely on the grounds that the state's authority in this area was subordinate
to the federal government's. But, the courts had never addressed illegal immigration. It
simply had not been a major issue.
Illegal immigration first became an issue in the early 1960s. Immigration and
Naturalization Service (INS) arrestsa limited indicator of illegal entriesswelled from
1.6 million during the decade of the 1960s to 8.3 million in the decade of the 1970s, and
then continued to rise in the early 1980s.47 When states and localities sought to protect
their education and health care budgets by imposing restrictions on the newcomers'
access to benefits, the courts could no longer ignore the issue.
Plyler v. Doe48 stands at the apex of immigrants rights in the United States.49
This class-action suit brought on behalf of undocumented Mexican children living in
Texas. Upholding the ruling of a lower court, a 5-4 majority canceled a statute that
47 Schuck, Illegal Immigration, pp. 85-92.
48 Plyler, 457 U.S. 202 (1982). Plyler v. Doe48 was a class action, filed in the United States District Court
for the Eastern District of Texas in September, 1977, on behalf of certain school-age children of Mexican
origin residing in Smith County, Texas, who could not establish that they had been legally admitted into the
United States. The action complained of the exclusion of plaintiff children from the public schools of the
Tyler Independent School District. The Superintendent James Plyler, and members of the Board of
Trustees of the School District were named as defendants; the State of Texas intervened as a party-
defendant. After certifying a class consisting of all undocumented school-age children of Mexican origin
residing within the School District, the District Court preliminarily enjoined defendants from denying a free
education to members of the plaintiff class. In December 1977, the court conducted an extensive hearing
on plaintiffs' motion for permanent injunctive relief.
49 Michael A. Olivas, Storytelling Out of School: Undocumented College Residency, Race, and Reaction,
Hastings Law Quarterly, Vol. 22 (Summer, 1995), 1019-1086.


CHAPTER 4
FINANCIAL AND ETHICAL ISSUES
Introduction
There were many fiscally obligatory issues relating to legal and illegal immigrant
education, the more important being English language proficiency and program equity.
Federal legislation and policy played an enormous role in setting up programs and
services as they were and in requiring the states to be responsible for implementation. In
addition, there were moral and ethical issues to be considered in the course of providing
educational services for the immigrant student population.
Legal Basis For States Responsibilities
Public education had always played a major role in shaping American society.
The public schools had often assumed the roles of both agents and enforcers of political,
economic, and social concerns.
Education was a plenary power granted to each state. Congress delegated
authority to the state to establish and maintain a system of free public schools wherein
all the children of the state may be educated. Educational practices, even though a state
function, conformed to the principles of the Fourteenth Amendment. In all fifty state
constitutions, the legislature was given the responsibility to determine policy. The state,
99


188
one, there can, of course, be no presumption that a state has a constitutional duty to
include illegal aliens among the recipients of its governmental benefits. [457 U.S. 247]146
The second strand of the Courts analysis rests on the premise that, although
public education is not a constitutionally guaranteed right, neither is it merely some
governmental benefit indistinguishable from other forms of social welfare
legislation.147 Whatever meaning or relevance this opaque observation might have in
some other context it simply has no bearing on the issues at hand. Indeed, it is never
made clear what the Court's opinion means on this score.
The importance of education is beyond dispute. Yet we have held repeatedly that
the importance of a governmental service does not elevate it to the status of a
fundamental right for purposes of equal protection analysis.148 In San Antonio
Independent School District, JUSTICE POWELL, speaking for the Court, expressly
rejected the proposition that state laws dealing with public education are subject to
special scrutiny under the Equal Protection Clause. Moreover, the Court points to no
meaningful way to distinguish between education and other governmental benefits [457
U.S. 248] in this context. Is the Court suggesting that education is more fundamental
than food, shelter, or medical care?
146 [The Department of Justice recently estimated the number of illegal aliens within the United States at
between 3 and 6 million. Joint Hearing before the Subcommittee on Immigration, Refugees, and
International Law of the House Committee on the Judiciary and the Subcommittee on Immigration and
Refugee Policy of the Senate Committee on the Judiciary, 97th Cong., 1st Sess., 7 (1981) (testimony of
Attorney General Smith). Other estimates run as high as 12 million. See Strout, Closing the Door on
Immigration, Christian Science Monitor, May 21, 1982, p. 22, col. 4.]
147 Ibid., p. 221.
148 San Antonio Independent School District v. Rodriguez, 411 U.S. 1, 301 (1973); Lindsey v. Normet, 405
U.S. 56, 73-74(1972).


122
Education is to the republican body politic what vital air is to the
natural body, necessary to its very existence, ... Education ought
to be here considered in its broadest sense, as not only embracing
literary and scientific, but political, moral, and religious instruction.
Let the great body of people be well informed, and their moral
character preserved, and they will know and understand their rights
and privileges. One hundred dollars, judiciously laid out, in the
education of youth, would go further in the maintenance and
support of a free Government, and in promoting the prosperity and
happiness of the people, than thousands expended in enacting
criminal codes, establishing courts of judicature, jails, and
penitentiaries without education.83
The New Hampshire Supreme Court in 1912 declared that the primary purpose of
the maintenance of the common school system was the promotion of the general
intelligence of the people constituting the body politic and thereby to increase the
usefulness and efficiency of the citizens, upon which the government of society
depended. Free schooling furnished by the state was not so much a right granted to pupils
as a duty imposed upon them for the public good. Public schools were the governmental
means of protecting the state from the consequences of an ignorant and incompetent
citizenship.84
Educating All Children
The philosophy of Horace Mann85 preached an educational awakening that was
ultimately to form the basis for state systems of public education as it became free of
secular public schools supported by both local and state general taxation.86
83 Ibid.
84 Fogg v. Board of Education, 76 N.H. 296, 82 A. 173, 174-75 (1912) as cited in Alexander, Kern and
Alexander, M. David. American Public School Law, New York, West Publishing Co., 23-24, (1992).
85 Horace Mann, 1796-1859, an educational reformer: instrumental in establishing the first normal school in
the U.S. in 1939.


2
Each time an immigration law or policy was implemented, the education system
was affected. It was believed that had the federal government enforced immigration
policy, the states would have not suffered the financial burden incurred from educating
the children of immigrants, both legal and illegal.
National estimates of growth in the immigrant student population projected a
increase of more than 20 percent, from 34 million in 1990 to 42 million in 2010. It was
estimated that more than half of that growth would be attributed to children of
immigrants. Proportional changes in Floridas school-age population mirrored or
exceeded those occurring in the states general population. Although in 1990, Hispanics
were 12 percent of the total school-age population, by 1996 they had grown to 16
percent.2 School-age children came from all over the world with a high concentration
coming from Hispanic countries.
Purpose Of The Study
The purpose of this study was to analyze the history of immigration policy and
subsequent court cases that have influenced the treatment of undocumented immigrant
children. In addition, to analyze the existing legal basis for educating undocumented
immigrant children through the examination of federal and state legislation, attorney
general opinions, state statutes, and district school board policies. The desired outcome
was to suggest recommendations for policy enhancements for educating illegal immigrant
K-12 students in the state of Florida.
2 Martha J. Miller (1997). Student Enrollment Figures by Ethnicity and Race. Tallahassee, FI: Strategy
Planning Department, Florida Department of Education.


121
The idea of free and common schools was developed on the foundation that a
nation of truly free men and women required schools open to all and supported by public
taxation. Upon the whole, considerable progress had been made in making schooling
accessible to all, though it was still true that the opportunity to take advantage of what
was theoretically provided for all was seriously limited by economic status.
Since the idea of the nation was equal opportunity for all, to nationalize education
meant to use the schools as a means for making this idea effective. There was a time
when simply providing schoolhouses, desks, blackboards and perhaps books could do
this.79 But that day had passed. Opportunities could be equalized only as the schools
made it their active serious business to enable all children to become masters of their own
fate.80
Horace Mann believed that every human being had an absolute right to an
education. Therefore, it was the correlative duty of every government to see that the
means of that education was provided for all.81
In February 1823, Representative White of Vermont presented his views on the
importance of education to Congress.82
78 Ibid., p 122.
79 Hickman and Alexander, The Essential Dewey.
80 Ibid.
81 Kern Alexander and M. David Alexander, American Public School Law, New York, West Publishing
Co., 1992, p 25. From the 10Ul Annual Report, published in The Common School Journal, Vol. IX, No. 9,
edited by Horace Mann, (Boston: William B. Fowler, 1847).
82Annals of Congress. House of Representatives, 17th Congress, 2nd session, U.S. Congressional
Documents and Debates. 1774-1873, pp. 960-961.


4
History
Opposition to the entry of foreign paupers and aliens likely at any time to
become a public charge dates from Colonial times.4 The colony of Massachusetts
enacted legislation in 1645 prohibiting the entry of paupers and in 1700 excluding the
infirm unless security was given against their becoming public charges. From these
beginnings, the United States continued to enact legislation designed to regulate the
number of immigrants based on the countries of origin. In so doing, and by not enforcing
the legislation, controlling the borders, or monitoring the illegal immigrant population,
the United States created an enormous influx of strangers-in-need. There was a call for
legislative policy to regulate not only numbers of immigrants, but also to see if and how
the immigrants who were here would be eligible for public services. Educating the
children of all immigrants, legal and illegal, became costly for some states due to federal
legislation. Federal policy was needed to assist and support these states in following its
mandates. States, such as Florida, with the highest immigrant populations, needed an
effective policy regarding the education and inclusion of immigrant children.
Historical Immigration Legislation
The United States did not have an immigration policy per se for most of the
nineteenth century. A bar against the landing of any person unable to take care of
himself or herself without becoming a public charge was included in the first general
federal immigration law, the Chinese Exclusion Act of August 3, 1882,5 which
4 U.S. House of Representatives Ways and Means Committee Print: 104-12 [Green Book] Appendix J.
Noncitizens The Personal Responsibility and Work Opportunity Reconciliation Act and Associated
Legislation, 1996, 5 Chinese Exclusion Act, ch.126, 22 Stat.58, 1882 (formerly codified in scattered parts of 8 U.S.C. ch.7).


123
In Horace Manns Tenth Annual Report to the Massachusetts Board of Education,
(1846), he stated: I believe in the existence of a great, immutable principle of natural
law, or natural ethics, a principle antecedent to all human institutions and incapable of
being abrogated by any ordinances of man, a principle of divine origin, clearly legible in
the ways of Providence as those ways are manifested in the order of nature and in the
history of the race, which proves the absolute right of every human being that comes into
the world to an education; and which, of course, proves the correlative duty of every
87
government to see that the means of that education are provided for all.
In his Twelfth Report (1849)88 Mann affirmed that without undervaluing any
other human agency, it may be safely affirmed the Common School, may become the
most effective and benignant of all the forces of civilization.89 As the child is father to
the man, so may the training of the schoolroom expand into the institutions and fortunes
of the state.90 Education, then, beyond all other devices of human origin, is the great
equalizer of the conditions of men the balance-wheel of the social machinery.91
07
In Democracy in America, Alexis De Tocqueville noted that even in its
formative stages our country attempted to be a place in which individuals could achieve
an economically viable and socially productive position solely because of their individual
86 Alexander and Alexander, American Public School Law, p. 21.
87 Ibid., p 25. From the 10th Annual Report, published in The Common School Journal, Vol. IX, No. 9,
edited by Horace Mann (Boston: William B. Fowle, 1847).
88 Ibid. 12th Annual Report, published separately from the Journal by Fowle in 1849.
89 Alexander and Alexander, American Public School Law, p. 25.
90 Ibid., p. 26.
91 Ibid.
92 Alexis De Tocqueville, (1805-1859) French statesman and author.


107
result in anything near a $2-billion cost savings. The fixed costs of these school districts
remained. So the closings and teacher layoffs required to save this amount of money
could not happen, because these fixed costs were required to meet the needs of the
remaining students.27
As for the incremental impact of immigrant students, researchers began to sort out
some of the additional costs to targeted programs like bilingual education. A study by the
Urban Institute suggested that the incremental cost to the core curriculum for bilingual
education was only $1,000 per student. Using this approach drastically reduced the cost
estimate for educating immigrant students from $2 billion to $300 million or less.
In Seminole County, Florida, for instance, the LEP student carried a weight of
1.211 of the per student basic weighting of 1.0, which equated to $3193.00 per year
(1999-2000). Therefore, the LEP program costs in Seminole County were $3867.00 per
student, per year, which was a $674.00 program cost differential, or 21 percent more
(1999-2000 expenditures).29
The Emergency Immigrant Education Act (EIEA)of 1984 funded the Emergency
Immigrant Education Program (EIEP)30. EIEA funds provided supplemental education
assistance for immigrant students, and for the training of teachers responsible for
instructing these students in both public and non-public elementary and secondary
schools. Eligible students were classified officially by the U.S. Department of Justice
27 Ibid.
28 Ibid.
29 Joseph Greene, FTE Administrator, Seminole County Public Schools, Sanford, Florida (2000).
30 The Emergency Immigrant Education Act (EIEA), Title IV, part D of the Elementary and Secondary
Education Act, as amended, (20 U.S.C. 3121-3130).


34
Immigration Policy After 1920
Congress finally responded to the Dillingham Commissions recommendations
ten years later by passing the Quota Act on May 19, 1921.18 The Act created a National
Origins plan under which each country had an immigrant quota in proportion to that
nations past contribution to the population of the United States.19 The Act based the
quotas on the 1910 census and allowed 357,000 immigrants into the United States each
20
year.
The 1924 Immigration Act used the 1890 census of different ethnic groups in the
United States as a basis for establishing a national origins quota for emigrant-sending
nations.21 The primary idea reflected in the Act of 1924 was the fear that heavy
immigration from southern and eastern Europe discriminated against current residents of
the United States (largely descended from northern and western Europeans) by diluting
the ability of current residents to determine the nations destiny.22 The 1924 Act
maintained the 1921 exemption from quotas for the independent countries of the Western
Hemisphere. The Western Hemisphere exception resulted from a combination of the
economic interests of southwestern ranchers and farmers and a policy of Pan-
Americanism that emphasized solidarity against the problems of Europe. Thus the
18 Quota Act, ch. 8,42 Stat. 5 (1921).
19 Ibid.
Ibid.
21 The Immigration Act of 1924, ch. 190,43 Stat. 153 (1924).
22 Benjamin M. Ziegler, ed., Immigration, An American Dilemma 13 (1953).
23 Marion T. Bennett, American Immigration Policies: A History, 249-55 (1963).


90
immigrants crossing the border, it should have reimbursed these states for the expenses
incurred in providing services to illegal aliens.
Justice Department lawyers indicated that the government spent more than $1
billion a year on immigration enforcement and returned more than one million
immigrants to their homelands. The lawyers pointed to those actions as demonstrations
that there had been no abdication of federal responsibility.108 Reimbursing the states was
only a small portion of what the federal government could have done to relieve the
burden that the social and educational needs of illegal immigrants have put on this
nation.109
Florida Immigration and Education
Due to Floridas geographical position, it attracted a disproportionate number of
legal as well as illegal immigrants. Florida was the state with the fourth largest illegal
immigrant population, behind California, New York and Texas, in 1997.110 This growth
in numbers resulted in an increased demand for state services such as emergency health
care, education and incarceration, and in turn, increased the state expenditures for
providing these services.111
108 Ibid.
109 Ibid.
110 Joyce C. Vialet and Larry M. Eig, Immigration and Federal Assistance: Issues and Legislation,
Congressional Research Service Issue Brief, April 18, 1996.
in
Ibid.


153
themselves of the equal protection guarantee is less than coextensive with that entitled to
due process. To the contrary, we have recognized [457 U.S. 212] that both provisions
were fashioned to protect an identical class of persons, and to reach every exercise of
state authority.
The Fourteenth Amendment to the Constitution is not confined to the protection
of citizens. It says: Nor shall any state deprive any person of life, liberty, or property
without due process of law; nor deny to any person within its jurisdiction the equal
protection of the laws. These provisions are universal in their application, to all persons
within the territorial jurisdiction, without regard to any differences of race, of color, or of
nationality, and the protection of the laws is a pledge of the protection of equal laws.
In concluding that all persons within the territory of the United States, including
aliens unlawfully present, may invoke the Fifth and Sixth Amendments to challenge
actions of the Federal Government, we reasoned from the understanding that the
Fourteenth Amendment was designed to afford its protection to all within the boundaries
naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States ...
(Emphasis added.) Justice Gray, writing for the Court in United States v. Wong Kim Ark, 169 U.S. 649
(1898), detailed at some length the history of the Citizenship Clause, and the predominantly geographic
sense in which the term jurisdiction was used. He further noted that it was impossible to construe the
words subject to the jurisdiction thereof, in the opening sentence [of the Fourteenth Amendment], as less
comprehensive than the words within its jurisdiction, in the concluding sentence of the same section; or
to hold that persons within the jurisdiction of one of the States of the Union are not subject to the
jurisdiction of the United States. Ibid., p. 687.]
[Justice Gray concluded that [e]very citizen or subject of another country, while domiciled here, is within
the allegiance and the protection, and consequently subject to the jurisdiction, of the United States. Ibid., p.
693. As one early commentator noted, given the historical emphasis on geographic territoriality, bounded
only, if at all, by principles of sovereignty and allegiance, no plausible distinction with respect to
Fourteenth Amendment jurisdiction can be drawn between resident aliens whose entry into the United
States was lawful, and resident aliens whose entry was unlawful. See C. Bouve, Exclusion and Expulsion
of Aliens in the United States pp. 425-427 (1912). Ed.]
26 Yick Wo, pp. 369.


94
Florida School Laws:
Regular school attendance required between ages of 6 and
16; permitted at age of 5; exceptions.
(l)(a) All children who have attained the age of 6 years
or who will have attained the age of 6 years by
February 1 of any school year or who are older than 6
years of age but who have not attained the age of 16
years, except as hereinafter provided, are required to
attend school regularly during the entire school term.
(f) Homeless children, as defined in s. 228.041, must
have access to a free public education and must be
admitted to school in the school district in which they
and their families live. School districts shall assist
homeless children to meet the requirements of §.
232.03, 232.03115, and 232.032, as well as local
requirements for documentation.
Districts were prohibited from requiring evidence of United States citizenship for
enrollment. School personnel enrolled students in school even though they may not have
entered the United States legally. In accordance with law (Plyler v. Doe, 1982 U.S.
Supreme Court), any student who lived in any state, and was of compulsory school age
was entitled to equal access to public school. The student needed only to produce
evidence of residence in the attendance zone of the school district. Pupils in grades K-
12 whose parents or guardians were non-residents of Florida could be charged a tuition
fee of $50.00 payable at time of enrollment. A non-resident was classified as someone
who had lived in Florida less than a year, had not purchased a home which was occupied
as a residence and had not filed a manifestation of domicile in the county. No tuition was
126 Florida School Laws, Chapters 228-246, 1999.
127 June 23, 1995, Memorandum, Enrollment of foreign-born and LEP students Florida DOE.


110
According to the 1990 Census, Florida had about 154,000 Limited English
Proficient (LEP) students in the public schools.37 These were mostly immigrant children
and the children of immigrants who required special instruction to prepare them to study
in English.38
A comprehensive study of the public sector costs of legal and illegal immigration
in Florida by Dr. Donald Huddle of Rice University and sponsored by Carrying Capacity
Network of Washington, DC, in 1993, assessed: current costs to Florida taxpayers of
federal, state and local services in 1992 to immigrants arriving since 1970; prospective
costs from 1993 to 2002; and current and prospective tax contributions of immigrants.
The costs examined were twenty-five federal, state and local service and assistance
programs available to legal immigrants, including a package of local government welfare
and health services, and twenty-one programs open to illegal immigrants.
The 1993 Huddle Report put 345,000 illegal immigrants in the State of Florida in
1992 and gave their total cost at $913 million more than their tax contributions.39 The
largest shares of the $5.35 billion paid out for aid and services to Floridas immigrants in
1992 were: Public education, including bilingual, adult and compensatory education,
37 Migration News, July 7, 1998.
38 This standard equation of the "immigrant children" population with the "LEP" student population was
convenient but imprecise, because many of those designated as LEP were, in fact, native-born U.S. citizens
rather than first generation immigrants. Nationally, over one-third of the fourteen million people who were
classified as LEP on the basis of the 1990 census data were native-born. Michael Fix and Jeffrey S. Passel,
Immigration and Immigrants: Setting the Record Straight, (Washington DC, The Urban Institute, 1994).
39 This report on the net costs of immigration to taxpayers of Florida was a follow-up to Huddles
comprehensive nationwide study, The Net National Costs of Immigration in 1993 released in June of
1994. The national study pointed out that legal and illegal immigrants who have settled in the U.S. since
1970 cost taxpayers $44.18 billion net in public assistance and worker displacement in 1993, in excess of
$76.9 billion they paid in taxes. More than 55% of these costs resulted from legal immigration. Of the
54.6 million people added to the nations population from 1970 to 1993,20.7 million or 38% were
immigrants. The national and Florida studies are part of a series of immigration cost studies commissioned
by Carrying Capacity Network.


77
The statute was attacked immediately as unconstitutional in several lawsuits, and
its operation shackled by restraining orders. On Dec. 14, 1996, U.S. District Court Judge
Mariana R. Pfaelzer of the Central District of California issued an oral decision to enjoin
the major provisions of Proposition 187 until trial.59
Constitutional Violations
Based on Judge Pfaelzers statement, the written decision/order, when issued,
found that much of the statute violated two of the provisions of the Constitution -- (1) the
Supremacy Clause,60 by stepping on ground preempted by federal immigration law; and
(2) the Fourteenth Amendment, first, by effectively ordering the deportation of California
residents without hearings or other due process of law and, second, by denial of free
education to undocumented children, that Amendment's Equal Protection clause.61
Proposition 187 prohibited public social services to those who could not establish
their status as a U.S. citizen, a lawful permanent resident, or an alien lawfully admitted
for a temporary period of time.62 Only persons in those categories could receive health
care services from a publicly funded health care facility, other than emergency medical
care as required by federal law.63 Anyone else was to be denied the requested services
or other benefits, directed in writing to either obtain legal status or leave the United
59 Initiative on Aliens Suffers Its Biggest Setback Yet, New York Times, Dec. 15, 1994, A18.
60 U.S. Constitution, Article VI.
61 Stanley Mailman, January 3, 1995. Californias Proposition 187 and Its Lessons, New York Law Journal
(p.3, col. 1).
62 Proposition 187, Sec. 5. The provisions that generate most benefits at issue are federal laws that bar
aliens who are not admitted as lawful residents or otherwise permanently residing here under color of law.
63
Ibid., Sec. 6.


12
such as preserving the government's financial resources, protecting the state from an
influx of illegal immigrants, and maintaining a high quality of education for resident
children. The Supreme Court, however, was not convinced that the law in question
advanced these objectives. The Court reasoned that any funds saved by denying
education to illegal alien children would be insignificant compared to the costs to the
children, the state, and our nation. The Court noted that many of these children would
remain in the United States and, if uneducated, would ultimately place a burden on our
society. Finding no rational justification for penalizing these children for their presence
within the United States, over which they had no control, the Court struck down the
law.44 As a result of this decision, public school districts were obligated to educate
immigrant children residing with their parents or guardians within a districts boundaries,
even if the families had entered the country illegally.
Public schools, however, did not have to admit non-resident immigrants tuition-
free. In 1983, the Supreme Court upheld a state law allowing local school boards to deny
tuition-free schooling to any minor who lived apart from a parent or legal guardian for
the primary purpose of attending public school.45 Thus, unlike immigrant children who
came to the U.S. with their parents (even illegally), immigrant children who left their
families to live in the United States for educational purposes were not entitled to free
schooling.
44 Ibid.
45
Martinez v. Bynum, 461 U.S. 321 (1983).


58
Table 2-1--continued.
1929
National Origins Act. The annual immigration ceiling of 150,000 was made
permanent, with 70 percent of admissions slated for those coming from northern and
western Europe, while the other 30 percent were reserved for those coming from
southern and eastern Europe.
1948
Displaced Persons Act. Entry was allowed for 400,000 persons displaced by World
War II. However, such refugees must have passed a security check and had proof of
employment and housing that did not threaten U.S. citizens' jobs and homes.
1952
McCarran-Walter Act. The Act consolidated earlier immigration laws and removed
race as a basis for exclusion. In addition, the Act introduced an ideological criterion for
admission: immigrants and visitors to the United States could be denied entry on the
basis of their political ideology (e.g., if they were Communists or former Nazis).
1964
Civil Rights Act of 1964. Title VI forbid discrimination against students who were
limited in their English proficiency.
1965
Immigration Act was amended. Nationality quotas were abolished. However, the Act
established an overall ceiling of 170,000 on immigration from the Eastern Hemisphere
and another ceiling of 120,000 on immigration from the Western Hemisphere.
1974
Lau v. Nichols. The U.S. Supreme Court held that the failure of the San Francisco
school system to provide for the lingual needs of non-English speaking Chinese
students violated section 601 of the Civil Rights Act of 1964.
1974
Equal Educational Opportunities Act of 1974. Required school districts to remove
barriers to non-English speaking students access to equal educational opportunities.
1975
Texas Education Code prohibited the education of nonresident aliens.
1978
Worldwide immigration ceiling introduced. A new annual immigration ceiling of
90,000 replaced the separate ceilings for the Eastern and Western Hemispheres.
1979
Ambach v. Norwick. Teaching certificates could only be given to U.S. citizens.
1980
Refugee Act. A system was developed to handle refugees as a class separate from
other immigrants. Under the new law, refugees were defined as those who fled a
country because of persecution on account of race, religion, nationality, or political
opinion. The president, in consultation with Congress, was authorized to establish an
annual ceiling on the number of refugees who may enter the United States. The
president also was allowed to admit any group of refugees in an emergency. At the
same time, the annual ceiling on traditional immigration was lowered to 270,000.
1982
Plyler v. Doe, 457 U.S. Case which determined that undocumented alien children were
entitled to a free public education and protection under the Fourteenth Amendment.
1989
Teresa P. v. Berkeley Unified School District. California federal district court found
that the Berkeley schools English-based bilingual education program did not violate
federal law.
1986
Immigration Reform and Control Act. The annual immigration ceiling was raised to
540,000. Amnesty was offered to those illegal aliens able to prove continuous
residence in the U.S. since January 1, 1982. Stiff sanctions for employers of illegal
aliens.
1990
Immigration Act of 1990. The annual immigration ceiling was further raised to
700,000 for 1992, 1993, and 1994; thereafter, the ceiling would drop to 675,000 a year.
Ten thousand permanent resident visas were offered to those immigrants agreeing to
invest at least $1 million in U.S. urban areas or $500,000 in U.S. rural areas. The
McCarranWalter Act of 1952 was amended so that people could no longer be denied
admittance to the United States on the basis of their beliefs, statements, or associations.


168
Of course, a concern for the preservation of resources, standing alone, can hardly justify
the classification used in allocating those resources.73 The State must do more than justify
its classification with a concise expression of an intention to discriminate.74 Apart from
the asserted state prerogative to act against undocumented children solely on the basis of
their undocumented status an asserted prerogative that carries only minimal force in the
circumstances of these cases we discern three colorable state interests that might
support 21.031. [457 U.S. 228]
First, appellants appear to suggest that the State may seek to protect itself from an
influx of illegal immigrants. While a State might have an interest in mitigating the
potentially harsh economic effects of sudden shifts in population,75 21.031 hardly offers
an effective method of dealing with an urgent demographic or economic problem. There
is no evidence in the record suggesting that illegal entrants impose any significant burden
on the State's economy. To the contrary, the available evidence suggests that illegal
aliens under utilize public services, while contributing their labor to the local economy
nothing more than the assertion that illegal entry, without more, prevents a person from becoming a
resident for purposes of enrolling his children in the public schools. A State may not, however, accomplish
what the Equal Protection Clause would otherwise prohibit merely by defining a disfavored group as
nonresident. And illegal entry into the country would not, under traditional criteria, bar a person from
obtaining domicile within a State. C. Bouve, Exclusion and Expulsion of Aliens in the United States 340
(1912). Appellants have not shown that the families of undocumented children do not comply with the
established standards by which the State historically tests residence. Apart from the alienage limitation,
21.031(b) requires a school district to provide education only to resident children. The school districts of
the State are as free to apply to undocumented children established criteria for determining residence as
they are to apply those criteria to any other child who seeks admission. Ed.]
73 Graham v. Richardson, 403 U.S. 365, (1971).
74 Board v. Flores de Otero, 426 U.S. 572, 605 (1976).
75 [Although the State has no direct interest in controlling entry into this country, that interest being one
reserved by the Constitution to the Federal Government, unchecked unlawful migration might impair the
State's economy generally, or the States ability to provide some important service. Despite the exclusive
federal control of this Nation's borders, we cannot conclude that the States are without any power to deter
the influx of persons entering the United States against federal law, and whose numbers might have a
discernible impact on traditional state concerns. Ed.] See De Canas v. Bica, 424 U.S. p. 454.


21
Miami, faced less discrimination than any other group in the survey. The children of
Cubans did worse academically than the children of Mexicans, who were one of the
poorest and were by far the largest immigrant group in the United States. On the issue
of language, the survey found while nine out of ten of the youths surveyed spoke a
language other than English at home, almost exactly the same proportion, 88 percent,
preferred English by the end of high school.76
Fiscal Responsibilities
Schools were caught in a struggle between the needs of immigrant children who
filled their classrooms and the growing number of parents and taxpayers unwilling to
expend more money for bilingual instructors to teach these students and buildings to
house them. According to The Center for Immigration Studies, it costs 50 percent more
to educate a child with limited English proficiency than a child with fluency in English.77
To help cover the cost of educating these children, the federal government gave
about $30 million a year through the Emergency Immigration Education Act of 1984.78
But educators and politicians believed the act was under-funded. In 1994, California,
Texas, New Jersey, New York, and Florida sued the federal government for billions of
dollars to cover the costs of educating undocumented immigrant children. The court
eventually rejected the state cases.79
76 Ibid.
77 Vail, No Entry pp. 19-25.
78 The Emergency Immigrant Education Act (EIEA), (Title IV, Part D of the Elementary and Secondary
Education Act), as amended, (20 U.S.C. 3121-3130) (expired September 30, 1999).
79 Vail, No Entry pp. 19-25.


108
(Immigration and Naturalization Service) as immigrants, and they resided in the United
States for less than three years.
In order for a school district to be eligible, it must have had at least 500 students
or three percent of its student population classified as immigrants. The federal
government provided all funds to the school districts for this program.
Florida Education Finance
Because Florida was one of the major entry ways for newly arrived non-English
language background students and families, its public schools faced challenges and
expenditures not experienced by many other states. The expenditures were offset
somewhat by the Emergency Immigration Education program.
The Florida Department of Education could have used up to 1.5 percent of all
funds received for administrative costs.31 Table 4-1 outlines the state totals for fiscal
years 1991-1994.32
Table 4-1 Florida EIEP Student Funding (100% Federal Funding)
FISCAL YEAR
NUMBER STUDENTS
FUNDING
1991
18,697
$ 935,940
1992
23,893
$1,017,709
1993
33,075
$1,282,260
1994
43,130
$1,538,453
TOTAL FEDERAL EXPENDITURES $4,774,362
Source: Florida Department of Education, Office of Multicultural Student Language Education,
September 1993.
31 The Unfair Burden Immigrations Impact on Florida, Florida Governors Office, Tallahassee, FL.,
March 1994.
32 These data were the latest available as of April 2000. Further research was in progress by the Florida
Department of Education.


151
on motion of the State, consolidated the claims against the state officials into a single
action to be heard in the District Court for the Southern District of Texas. A hearing was
conducted in February and March 1980. In July 1980, the court entered an opinion and
order holding that 21.031 violated the Equal Protection Clause of the Fourteenth
Amendment.18 The court held that the absolute deprivation of education should trigger
strict judicial scrutiny, particularly when the absolute deprivation is the result of complete
inability to pay for the desired benefit.19 The court determined that the State's concern
for fiscal integrity was not a compelling state interest; that exclusion of these children had
not been shown to be necessary to improve education within the state; and that the
educational needs of the children statutorily excluded were not different from the needs
of children not excluded. The court therefore concluded that [457 U.S. 210] 21.031 was
91
not carefully tailored to advance the asserted state interest in an acceptable manner.
While appeal of the District Court's decision was pending, the Court of Appeals rendered
its decision in No. 80-1538. Apparently on the strength of that opinion, the Court of
Appeals, on February 23, 1981, summarily affirmed the decision of the Southern District.
We noted probable jurisdiction,22 and consolidated this case with No. 80-1538 for
briefing and argument.
18 In re: Alien Children Education Litigation, 501 F.Supp. 544. [The court concluded that 21.031 was not
preempted by federal laws or international agreements. 501 F.Supp. pp. 584-596. Ed.]
19 Ibid., p. 582.
20 Ibid., pp. 582-583.
21 457 U.S. 210
22 452 U.S. 937 (1981). [Appellees in both cases continue to press the argument that 21.031 is preempted
by federal law and policy. In light of the disposition of the Fourteenth Amendment issue, we have no
occasion to reach this claim. Ed.]


the societal and fiscal effects of illegal immigration as a whole, but little addressed the
education aspect and its costs or consequences.
The purpose of this study was to analyze the history of immigration policy and
subsequent court cases that had influenced the treatment of undocumented immigrant
children. In addition, to analyze the existing legal basis for educating undocumented
immigrant children through the examination of federal and state legislation, attorney
general opinions, state statutes, and district school board policies. The desired outcome
was to suggest recommendations for policy inclusions for educating illegal immigrant
K-12 students.
Policy components for effective immigrant education needed to include:
1) Immigrant student inclusion in all school and district assessments; 2) staff
development training in the understanding of the special needs of immigrant children; 3)
development of additional instructional materials for immigrant children; 4) assessment
instruments in languages other than English and Spanish; 5) increased school counseling
services for immigrant children; 6) increased immigrant parent involvement in overall
school programs; 7) Inclusion of limited English proficient children in school-wide
programs; and 8) a determination of what investments the public was willing to make to
ensure the education and future economic success of immigrant children.
x


106
change. Social equity in education would become part of the consciousness of the
American public from this point forward.24
The debate in California over providing public education to children of
undocumented immigrants centered on the $2-billion subsidy endured by California tax
payers. Those who quoted this expense assumed that it was the true cost of educating
these children and would be the net savings to the public education system from barring
illegal immigrants.25
The basis for the $2-billion (California) estimate came from the projections by the
Immigration and Naturalization Service and Census Bureau. Using these data, a common
estimate for the number was then multiplied by the per pupil average costs, which for
large urban school districts have ranged between $6,000 and $7,000 a year in 1996.26
The problem with this estimate, however, was not the number of undocumented
children enrolled in public schools, but the use of average cost data rather than marginal
cost data, the additional costs of educating the undocumented students. This was
considered by some to be a major methodological flaw. Average costs included fixed
costs such as buildings, debt payment on bonds and, in some instances, multiyear
negotiated contracts for salaried employees and variable costs such as classroom
materials and supplies. In the case of K-12 education, there was a considerable amount
of fixed cost hidden in the average cost estimate and a limited amount of variable cost.
Therefore, eliminating access to K-12 education to undocumented students would not
24 Lau v. Nichols, 414 U.S. p. 566.
25 Adela de la Torre, False Figure Fuels Furor, Los Angeles Times, July 31, 1996, Section B.
26
Ibid.


54
medical care, was enormously expensive, and there could be no doubt that very large
added costs would fall on the State or its local school districts as a result of the inclusion
of illegal aliens in the tuition-free public schools.
Justice Burger went on to say that Denying a free education to illegal alien
children is not a choice I would make were I a legislator. Apart from compassionate
considerations, the long-range costs of excluding any children from the public school may
well outweigh the costs of educating them.11*6 But that was not the issue: the fact that
there were sound policy arguments against the Texas Legislatures rule did not make it
unconstitutional.107
Justice Burger saw the ruling as a quick fix for the failings of the political
processes. He felt that better enforcement of immigration laws and policies would have
108
prevented the need to rule on the right of illegal children to a free education.
The court suggested that our institutions had confidently and successfully
undertaken similar challenges. In Plyler, confidence in undertaking tough educational
missions, analogous to those in prior decisions such as Meyer v. State of Nebraska,
106 Plyler, 457 U.S. 253.
107 Ibid.
108 Ibid.
109 In Meyer v. State of Nebraska, 262 U.S. 390 (1923) the United States Supreme Court upheld the right of
parents and teachers to arrange foreign language instruction for children and struck down a Nebraska statute
prohibiting foreign language instruction to children before the eighth grade (see Neb. Laws 1919, CH. 249).
The Court stated: It is the natural duty of the parent to give his children education suitable to their station
in life ... (400). The Court saw no harm in German language instruction to children when the childrens
parents did not contest the right of the state to reasonably regulate schools, compel attendance, and
prescribe a curriculum for state-supported institutions. (Meyer, pp. 402-03).


CHAPTER 3
IMMIGRATION LAWS AND PROPOSITION 187
Introduction
This chapter reviews the major immigrant education laws and policies of the last
half of the nineteenth century. It discusses ways in which each are based on precedent
policy and how they are associated. Of particular concern are Plyler v. Doe1 and
Californias Proposition 187.2
Background
The earliest immigration laws were designed to protect the populace. Criminals,
prostitutes, and other undesirables were prohibited from entering the United States.
Exclusionary practices were implemented to keep certain nationalities from entering on a
permanent basis. Finally, immigration laws were adapted to achieve acceptable levels of
immigration to ensure that the United States could assimilate the new population
comfortably.
The immigration laws of the United States divided all people in the world into
two groups: United States nationals and aliens.3 Almost all nationals also carried
1 Plyler v. Doe, 457 U.S. 202 (1982).
2 Proposition 187 was approved by the electors of California on November 8, 1994, as an initiative statute.
See 1994 Cal. Legis. Serv., Prop. 187, (Westlaw).
3 Immigration and Nationality Act, (INA), Public Law 82-414, [s 101(a)(3)], 8 U.S.C. [s 1101(a)(3)]
(1994), defines alien as any person not a citizen or national of the United States. Since all citizens are
nationals, the definition of alien could easily read any person not a national of the United States.
61


43
immigrants, because of refugees,65 and above all, family re-unification policies,66
comprised the vast majority of the immigration backlog.67
16
14
12
10
8
6
4
2
0
1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 1997
Source: U.S. Census Bureau, Current Population Survey, March 1999.
Figure 2-1 U.S. Foreign-Bom Population
65 Hing, Making and Remaking Asian America, pp. 12-28.
66 Family re-unification effectively excluded European immigrants because relatively fewer Americans still
had close family in Europe. Brimelow, Alien Nation, at 78-84. In contrast, the vast majority of Asian and
Latin American immigrants arrived after the passage of the 1965 Act or were descended from post-1965
immigrants. Brimelow, Alien Nation, pp. 78-84.
67 Scott McConnell, The New Battle over Immigration, Fortune, p. 98, May 9, 1988.


76
notification of the alien (or in the case of children, their parent or guardian) of their
apparently illegal status.57 Proposition 187 was no ordinary law; it provided that the
legislature could not amend it except to further its purposes and then only by a
recorded super-majority vote in each house of the legislature or by another voter
initiative.
Californias Proposition 187 contained several components aimed at stopping
illegal immigration. It strengthened federal welfare laws that already denied most
benefits to illegal aliens. A provision of 187 built on existing federal law relating to the
use or sale of fraudulent documents and gave the state an extra weapon to combat such
activities. Proposition 187 also required local, state, and federal agencies to share
information.58
Proposition 187 established a number of principles in relation to public education.
First, it aimed to deter future illegal immigration for free education. The problem of
educating illegal aliens at taxpayers expense related not only to illegal aliens already
here, but to those who would come in the future. Second, it proposed that education
should be in the persons home country. Third, the initiative addressed the financial
problems caused by providing illegal immigrants with free education. The costs of
educating non-English speaking immigrants were higher due to their need to learn
English.
56 Thomas A. Alienkoff, David A. Martin, and Hiroshi Motomura. (1998). Immigration and Citizenship:
Process and Policy. Fourth Edition. West Group, St. Paul, Minn.
57 Schuck, Illegal Immigration, pp. 85-92.
58
Ibid.


197
Calvo, Janet M. Alien Status Restrictions on Eligibility for Federally Funded Assistance
Programs, 16 New York University Review of Law & Social Change, 395
(1987-88).
Carmona, Abel. "Dispelling Myths About Immigrant Students", IRDA Newsletter May
1996.
Carrera, John Willshire. Educating Undocumented Children: A Review Of Practices And
Policies (Trends and Issues Paper). Charleston, WV (ERIC Clearinghouse on
Rural Education and Small Schools, 1989a).
Carrera, John Willshire. Immigrant Students: Their Legal Right Of Access To Public
Schools: A Guide For Advocates And Educators, Boston, MA (National
Coalition of Advocates for Students, 1989b).
Casey, Annie E. 1997 Kids Count: USA Profile, Baltimore, Maryland: Annie E. Casey
Foundation, 1997.
Children of Immigrants Thrive in U.S. Schools, The Orlando Sentinel, 22 March 98
1998, A-12.
Cose, Ellis. A Nation of Strangers: Prejudice, Politics and the Populating of America.
New York: Wm. Morrow & Company, Inc., 1992.
de la Torre, Adela. False Figure Fuels Furor, Los Angeles Times, Sec. B., July 31, 1996.
De Tocqueville, Alexis. Democracy in America (1835) (New York: Alfred A. Knopf,
Everymans Library, 1994), p. 315.
Dewey, John. Philosophy of Education, New Jersey: Littlefield, Adams & Co. p. 122
(1958).
Digrado, John. News, Daily Bruin, May 1996,
(October 1998).
Du Bois, W.E.B. The Freedom to Learn Midwest Journal 2, Winter 1949, pp. 230-31.
Federal Judge: Proposition 187 Unconstitutional. Stage Set For Appeal Of Anti-
Immigrant Initiative, Los Angeles Times, 5A, November 15, 1997.
Fix, Michael and Passel, Jeffrey S. Immigration and Immigrants: Setting the Record
Straight. Washington, DC: Urban Institute, May 1994.
Florida Department of Education, 98-99 Full-Time Public School Equivalency Report of
Student Enrollment.


162
perceptions of the public schools as inculcating fundamental values necessary to the
maintenance of a democratic political system have been confirmed by the observations of
social scientists.50 In addition, education provides the basic tools by which individuals
might lead economically productive lives to the benefit of us all. In sum, education has a
fundamental role in maintaining the fabric of our society. We cannot ignore the
significant social costs borne by our Nation when select groups are denied the means to
absorb the values and skills upon which our social order rests.
In addition to the pivotal role of education in sustaining our political and cultural
heritage, denial of education to some isolated group of children poses an affront to one of
the goals [457 U.S. 222]of the Equal Protection Clause: the abolition of governmental
barriers presenting unreasonable obstacles to advancement on the basis of individual
merit. Paradoxically, by depriving the children of any disfavored group of an education,
we foreclose the means by which that group might raise the level of esteem in which it is
held by the majority. But more directly, education prepares individuals to be self-reliant
and self-sufficient participants in society.51 Illiteracy is an enduring disability. The
inability to read and write will handicap the individual deprived of a basic education each
and every day of his life. The inestimable toll of that deprivation on the social,
economic, intellectual, and psychological well being of the individual, and the obstacle it
poses to individual achievement, make it most difficult to reconcile the cost or the
principle of a status-based denial of basic education with the framework of equality
50 Ambach v. Norwick, p. 192.
51 Wisconsin v. Yoder, p. 221.


171
creation and perpetuation of a subclass of illiterates within our boundaries, surely adding
to the problems and costs of unemployment, welfare, and crime. It is thus clear that
whatever savings might be achieved by denying these children an education, they are
wholly insubstantial in light of the costs involved to these children, the State, and the
Nation.
If the State is to deny a discrete group of innocent children the free public
education that it offers to other children residing within its borders, that denial must be
justified by a showing that it furthers some substantial state interest. No such showing
was made here. Accordingly, the judgment of the Court of Appeals in each of these cases
is Affirmed. MARSHALL, J., concurring
JUSTICE MARSHALL, concurring.
While I join the Court opinion, I do so without in any way retreating from my opinion in
San Antonio Independent School District v. Rodriguez, (dissenting opinion). I continue
to believe that an individual's interest in education is fundamental, and that this view is
amply supported by the unique status accorded public education by our society, and by
the close relationship between education and some of our most basic constitutional
values.85
Furthermore, I believe that the facts of these cases demonstrate the wisdom of
rejecting a rigidified approach to equal protection analysis, and of employing an approach
that allows for varying levels of scrutiny depending upon the constitutional and societal
importance of the interest adversely affected and the recognized invidiousness of the
85
457 U.S. 231


27
Limitations
This study provides an analysis of previous statutes, court cases, school board
policies, and attorney general opinions related to the education of undocumented alien
children. As the members of the courts change, changes could develop in the legal bases
providing the foundation for this study.
Further limitations are listed below.
1) It is unlawful to ask for proof of legal status from a student.
2) Discussion of education expenditures include K-12 but not post-secondary.
3) Data available are estimates from the total population.
4) Most recent Census data is for 1990 (with estimates for 2000).
5) The transient nature of the target population.
6) Local governments do not document U.S. residency status of local service
consumers, in part, because local residency is a requirement for local service
eligibility: U.S. residency status is not a program eligibility requirement.
7) Statutory and other data collection requirements on Newcomers for state and
local entities are incomplete, unverified, sometimes non-mandatory, of
relatively low priority, include no provisions for centralized reporting, and are
under-utilized by state and local governments.
Design Of Study
The framework for this study was provided by legal doctrines that can be
identified in the U.S. Constitution, federal and state case law, statutes, and rules and
regulations, and the Florida Constitution. The study was an examination of law and
policy as it related to the education of undocumented immigrant children. It looked at
estimates and percentages of undocumented alien children and the educational programs


62
the title citizen. Aliens in turn were divided into two subgroups: immigrants and
nonimmigrants. A nonimmigrant was any alien who could prove that he or she fell into
one of the statutorily enumerated categories of temporary visitors, such as students,
tourists, business visitors, or temporary workers.4 All other aliens were immigrants5 and
therefore subject to the more rigorous standards applicable to those who sought
permanent residence in the United States.
Immigrants themselves were sub-classified. There were those who were
lawfully admitted for permanent residence,6 holders of so-called green cards. And
there were those who were here unlawfully, having entered illegally, overstayed, or
otherwise violated the terms of temporary admission (undocumented or illegal
immigrants). There was an additional hybrid category known as aliens Permanently
Residing Under Color of Law, or PRUCOLs.7 While the definition of PRUCOL varied
from one program to another, the term typically encompassed those who had received
asylum, some of those who had been paroled from prison into the United States, and
miscellaneous others who remained in the United States with the knowledge and
permission of the Immigration and Naturalization Service (INS) and whom the INS did
o
not intend to remove. The most general observation was that the major federal and state
4 Immigration and Nationality Act, Public Law 82-414, (INA) [s 101(a)( 15)], 8 U.S.C. [s 1101(a)(15)] as
amended (1994).
5 Ibid.
6 Ibid., [s 101(a)(20)].
7 U.S. Commission on Immigration Reform, U.S. Immigration Policy: Restoring Credibility 139-43 (1994)
[hereinafter CER]; includes certain Cubans and Haitians and aliens whose deportations have been withheld
or stayed.
8 Ibid.


47
its jurisdiction confirmed the understanding that the Fourteenth Amendment's protection
extended to anyone, citizen or stranger, who was subject to the laws of a State, and
reached into every comer of a State's territory; (2) the discrimination contained in the
Texas statute which withheld from local school districts any state funds for the education
of children who were not legally admitted into the United States and which authorized
local school districts to deny enrollment to such children could not be considered rational
unless it furthered some substantial goal of the state. Although undocumented resident
aliens could not be treated as a suspect class, and education was not a fundamental
right, so as to require the State to justify the statutory classification by showing that it
served a compelling governmental interest, the Texas statute did impose a lifetime
hardship on a discrete class of children not accountable for their disabling status. These
children could neither affect their parents' conduct nor their own undocumented status.
The deprivation of public education was not like the deprivation of some other
governmental benefit79. Public education had a pivotal role in maintaining the structure
of our society and in sustaining our political and cultural heritage; the deprivation of
education took an inestimable toll on the social, economic, intellectual, and psychological
well-being of the individual, and posed an obstacle to individual achievement. In
determining the rationality of the Texas statute, its costs to the Nation and to the innocent
children could properly be considered; (3) the undocumented status of the children vel
non did not establish a sufficient rational basis for denying the benefits that the state
afforded other residents. It was true that, when faced with an equal protection challenge
respecting a State's differential treatment of aliens, the courts needed to be attentive to
79 Plyler, 457 U.S. 203


TABLE OF CONTENTS
page
ACKNOWLEDGMENTS iii
LIST OF TABLES vii
LIST OF FIGURES viii
ABSTRACT ix
CHAPTERS
1 INTRODUCTION 1
Purpose of the Study 2
Significance of the Research 3
Statement of the Problem 3
History 4
Historical Immigration Legislation 5
Immigration Policy 9
Immigration Statistics 10
Illegal Immigration 11
Immigrant Education 14
Societal Impact 17
Fiscal Responsibilites 21
Research Question 25
Methodology 25
Definition of Terms 26
Limitations 27
Design of the Study 27
Organization of the Chapters 28
2 HISTORICAL REVIEW OF IMMIGRATON LEGISLATION 29
Introduction 29
Immigration Legislation 29
American Immigration Before 1920 32
Immigration Policy After 1920 34
The 1952 Immigration Act 38
IV


28
they require. Data were retrieved from the Internet and/or public documents and
publications.
1) The study examined historical constitutional issues involved in educating
undocumented alien children in order to demonstrate previous policy.
2) The study analyzed the United States Supreme Court ruling in Plyler v. Doe
(1982) in order to understand the current paradigm.
3) The study examined California's Proposition 187, and its implications for
legislative policy for the state of Florida.
4) The study looked at some of the ethical and moral considerations of educating
undocumented alien children in order to determine the obligations of the state
of Florida.
5) The study suggested a feasible policy on undocumented immigrant education
for the state of Florida.
Organization of the Chapters
Chapter 1 provides introductory information, a statement of the problem, and the
significance, methodology, limitations, and design of the study. The remainder of this
study is organized in the following manner. Chapter 2 presents an historical review of
immigration legislation through 1982. Chapter 3 continues with the historical review and
looks at some illegal immigration statistics for the United States and the state of Florida.
Chapter 4 presents some financial and ethical issues related to the education of
undocumented immigrant children. Using some historical information, it also puts
forward the question of what would the political atmosphere regarding the education of
immigrant children would be like if the Plyler decision had been different. Chapter 5
suggests inclusions for a practical immigrant education policy for the state of Florida,
including the undocumented immigrant student.


CHAPTER 2
HISTORICAL REVIEW OF IMMIGRATION LEGISLATION
Introduction
This chapter discusses immigrants and immigration and examines U.S. immigrant
legislation through 1982. It looks at the origins of immigration and immigrant education
policies and the reasons they came into existence.
Immigration Legislation
The extraordinary migrations of peoples from Europe and Asia to the Americas,
Australia, and Africa during the last hundred years, not as colonists but as immigrants to
countries already politically established, was one of the noticeable and far-reaching
phenomena of the economic age. The United States, as the country that received these
immigrants in greatest numbers, experienced the greatest perplexity over the problems
this immigration created.
The United States continued to be an appealing place to live. If it were less
desirable, perhaps residence in the U.S. would not need to be legally restricted. But, in
the closing years of this century, immigration levels were at an historic high, and the
demand remained as great as it had ever been. The assumption behind U.S. citizenship
and immigration law was that we could not embrace all who wanted to make this country
their home. There needed to be some standard for admission and exclusion. So whom
29


48
congressional policy concerning aliens. But in the area of special constitutional
sensitivity presented by these cases, and in the absence of any contrary indication fairly
discernible in the legislative record, no national policy was perceived that might justify
the State in denying these children an elementary education; (4) there was no national
policy that might justify the state in denying the children an elementary education; and (5)
the Texas statute could not be sustained as furthering its interest in the preservation of the
states limited resources for the education of its lawful residents. While the State did have
an interest in mitigating potentially harsh economic effects from an influx of illegal
immigrants, the Texas statute did not offer an effective method of dealing with the
problem. Even assuming that the net impact of illegal aliens on the economy was
negative, charging tuition to undocumented children constituted an ineffectual attempt to
stem the tide of illegal immigration, at least when compared with the alternative of
prohibiting employment of illegal aliens. Nor was there any merit to the suggestion that
undocumented children were appropriately singled out for exclusion because of the
special burdens they imposed on the states ability to provide high-quality public
education. History did not show that exclusion of undocumented children was likely to
improve the overall quality of education in the State. Neither was there any merit to the
claim that undocumented children were appropriately singled out because their unlawful
presence within the United States rendered them less likely than other children to remain
within the State's boundaries and to put their education to productive social or political
use within the State.80
Plyler, 457 U.S. 246.


205
Immigration and Nationality Act, Public Law 82-414, (1952).
Immigration Reform and Control Act, Pub. L. No. 99-603, 100 Stat. 3359 (1986).
Jefferson v. Hackney, 406 U.S. 535, 549 (1972); Reed v. Reed, 404 U.S. 71, 75 (1971).
Keyes v. School District No.l, (1983) 724 F. Supp. 1503.
Lau v. Nichols, 414 U.S. 563 (1974).
League of United Latin American Citizens (LULAC) et al. v. the State Board of
Education et al. Consent Decree, U.S. District Court for the Southern District of
Florida, August 14, 1990.
Leeper v. State, 103 Tenn. 500, 53 S.W. 962 (1899).
Lindsey v. Normet, 405 U.S. 56, 73-74 (1972).
Martinez v. Bynum, 461 U.S. 321 (1983).
Mathews v. Diaz, 426 U.S. 67 (1976).
McCarran-Walter Act, ch. 477, 66 Stat. 163, 8 U.S.C. § 1101
Meyer v. State of Nebraska, 262 U.S. 390 (1923).
New York Constitution, Article XVII; Tucker v. Toia, 43 NY2d 1, 8 (1977).
North American Free Trade Agreement, (NAFTA), August 1992.
Pierce v. Society of Sisters, 268 U.S. 510 (1925).
Plyler v. Doe, 457 US 202 (1982).
Proposition 187, Sec. 5-7.
Quota Act, ch. 8, 42 Stat. 5 (1921).
Refugee Act of March 17, 1980, Immigration and Nationality Act, [101 (a)(42)(A)].
San Antonio Independent School District v. Rodriguez, 411 U.S. 1, 35 (1973).
Serrano v. Priest. California Supreme Court, 1971.
Teresa P. v. Berkeley Unified School District, (1989) 724 F. Supp. 698.


170
child [which might result from devoting some state funds to the education of the excluded
group] will have a grave impact on the quality of education.81 And, after reviewing the
State's school financing mechanism, the District Court in No. 80-1538 concluded that
barring undocumented children from local schools would not necessarily improve the
quality of education provided in those schools.82 Of course, even if improvement in the
quality of education were a likely result of barring some number of children from the
schools of the State, the State must support its selection of this group as the appropriate
target for exclusion. In terms of educational cost and need, however, undocumented
children are "basically indistinguishable" from legally resident alien children.
Finally, appellants suggest that undocumented children are appropriately singled
out because their unlawful presence within the United States renders them less likely than
other children to remain within the boundaries of the State,84 and to put their education to
productive social or political use within the State. Even assuming that such an interest is
legitimate, it is an interest that is most difficult to quantify. The State has no assurance
that any child, citizen or not, will employ the education provided by the State within the
confines of the State's borders. In any event, the record is clear that many of the
undocumented children disabled by this classification will remain in this country
indefinitely, and that some will become lawful residents or citizens of the United States.
It is difficult to understand precisely what the State hopes to achieve by promoting the
81 501 F.Supp. p. 583.
82 458 F.Supp. p. 577.
83 Ibid., p. 589; 501 F.Supp. p. 583, and n. 104.
84
457 U.S. 230


97
As a result, the potential strengths and opportunities these students represented
sometimes went unrecognized.137
Florida faced three different types of challenges in educating LEPs: (a) the need
for effective personnel to fully implement educational policies; (b) a commitment to
equity in achieving academic excellence; and (c) leadership in creating a unified vision of
educational outcomes. With increased international trade and an expanding global
market, the presence of LEPs continued to grow statewide. It was necessary to find a
way to recognize the opportunities and challenges of educating the LEP students, and to
promote educational reform to the many areas of the states development.138
Summary
The earliest immigration laws were to protect the populace from indigents and
other undesirables. Immigration laws then designated who and how many people could
be admitted from any given country. Subsequently, the immigration laws allowed
relatives of immigrants already in the country to emigrate in an effort to keep families
together. Once they started coming, the immigration laws turned to immigrant policy to
provide the necessary services, including health care, to these immigrants who had
arrived in the U.S. with almost nothing. The cost of providing social service benefits to
illegal immigrants fell to the states and was part of the border control debate. In addition,
in 1982, the Supreme Court139 ruled that states must provide illegal immigrants with
schooling. That decision added to the education and health care budgets of several states.
137 Fradd and Lee, Creating Floridas Multilingual Global Workforce.
138
Ibid.


32
agreementwhereby the latter government undertook to limit, by the refusal of
passports, the entrance of laborers into the United States.7
In 1924, the United States Congress passed an actx that reduced annual
immigration to 2 percent of the number of foreign residents in 1890. A minimum of 100
was accorded to each country. This law was replaced in 19659 by a measure phasing out
the quota system by July 1, 1968. It provided for a total permissible immigration of
120,000 yearly from independent countries of the Western Hemisphere and 170,000 from
all other countries, but not over 20,000 from any one country. Preference was given to
members of professions or those having special talents or education. In addition,
immediate relatives of citizens could be admitted without limit, including minor children,
spouses, and parents. No previous law had limited immigration from the Western
Hemisphere.10
American Immigration Before 1920
Prior to the 1790 Naturalization Rule, the United States did not have an
immigration policy. It did enact laws pertaining to the entry of people into the country,
although it was doubtful that these could be considered part of a true immigration
policy.11 The 1790 immigration rule required a two-year residency period combined with
7 Ibid.
8 The Immigration Act of 1924, ch. 190,43 Stat. 153 (1924).
9 Immigration Act of 1965, Pub. L. No. 89-235, 79 Stat. 911 (codified as amended at 8 U.S.C. § 1-14354
(1994).
10 Ibid.
11 Gregg Van De Mark Too Much of a Good Thing, Washburn Law Journal 35, no. 3 (Spring 1996)
.


189
The Equal Protection Clause guarantees similar treatment of similarly situated
persons, but it does not mandate a constitutional hierarchy of governmental services.
JUSTICE POWELL, speaking for the Court in San Antonio Independent School
District,149 put it well in stating that, to the extent this Court raises or lowers the degree of
judicial scrutiny in equal protection cases according to a transient Court majority's
view of the societal importance of the interest affected, we assume a legislative role, and
one for which the Court lacks both authority and competence.150 Yet that is precisely
what the Court does today.151
The central question in these cases, as in every equal protection case not involving
truly fundamental rights explicitly or implicitly guaranteed by the Constitution,152 is
whether there is some legitimate basis for a legislative distinction between different
classes of persons. The fact that the distinction is drawn in legislation affecting access to
public education -- as opposed to legislation allocating other important governmental
benefits, such as public assistance, health care, or housing cannot make a difference in
the level of scrutiny applied.153 B
149 Ibid.,, p. 31.
150 [The Court implies, for example, that the Fourteenth Amendment would not require a state to provide
welfare benefits to illegal aliens.]
151 Shapiro v. Thompson, 394 U.S. 618, (1969) (Harlan, J., dissenting).
152 San Antonio Independent School District, pp. 33-34.
153 [Both the opinion of the Court and JUSTICE POWELL's concurrence imply that appellees are being
penalized because their parents are illegal entrants. Ibid., p. 220; p. 239, n. 3 (POWELL, J., concurring).
However, Texas has classified appellees on the basis of their own illegal status, not that of their parents.
Children born in this country to illegal alien parents, including some of appellees siblings, are not
excluded from the Texas schools. Nor does Texas discriminate against appellees because of their Mexican
origin or citizenship. Texas provides a free public education to countless thousands of Mexican immigrants
who are lawfully in this country.]


xml version 1.0 encoding UTF-8
REPORT xmlns http:www.fcla.edudlsmddaitss xmlns:xsi http:www.w3.org2001XMLSchema-instance xsi:schemaLocation http:www.fcla.edudlsmddaitssdaitssReport.xsd
INGEST IEID EZNQ7K7O2_04VGG1 INGEST_TIME 2014-11-07T19:27:11Z PACKAGE AA00017699_00001
AGREEMENT_INFO ACCOUNT UF PROJECT UFDC
FILES


130
In addition to their Plyler right of access, under state law, both documented and
undocumented immigrant students were obligated to attend primary and secondary
schools until they reached a mandated age (age sixteen in the state of Florida).
Conversely, states were obligated to enforce these laws with regard to immigrant
students, as with U.S. citizens and permanent residents.7
Therefore, public schools and public school personnel were prohibited under
Plyler from adopting policies or taking action to deny or which resulted in the denial of
the right of access to resident immigrant students on the basis of their immigrant status,
and in particular, undocumented immigrant students8 on the basis of their undocumented
status.
Education is perhaps the most important function of state and local
governments...[I]I is doubtful that any child may reasonably be
expected to succeed in life if he is denied the opportunity of an
education. Such an opportunity, where the state has undertaken to
provide it, is a right which must be made available to all on equal
terms.9
The Fourteenth Amendment to the United States Constitution provided in pertinent part:
... nor shall any state deprive any person of life, liberty or
property, without due process of law; nor deny to any person
within its jurisdiction the equal protection of the laws.
The Fourteenth Amendment to the Constitution was not confined to the protection
of citizens. The provisions were universal in their application, to al persons within the
7 Ibid.
8 Undocumented students, for this purpose, are students (K-12) who reside in the United States without
legal immigration status. That is, students who entered the U.S. without going through the Immigration
and Naturalization Service and remained here without valid immigration papers or student who entered
with valid visas and who have since fallen out of status.
9 Brown v. Board of Education, 347 US 483,493 (1954).


85
schools to verify the legal status of all students over 18 years of age enrolled in English
as a Second Language programs, and of all students over 20 who entered the U.S. after
the age of 12, or risk losing some state funding.92
An initiative similar to Proposition 187 was proposed by Rep. Elton Gallegly93 as
an amendment to the omnibus immigration reform bill (H.R. 2202) in 1996. The
amendment attempted to combine two entirely different issues into one bill. Joining
efforts to secure our borders with reforms to our system of legal immigration served only
to confuse the debate.94 It played on the publics understandable concern over illegal
immigration but twisted that concern into the misguided notion that all immigration was
harmful and all immigrants were undocumented, sneaking into our country by night.
Neither notion, of course, was true, but dealing with illegal and legal immigration in one
bill served to fuel hostility and even prejudice toward all immigrants. The amendment
would have authorized states to deny public education to the children of illegal aliens. It
would have denied American citizens and legal permanent residents the opportunity to
bring close relatives into the United States. H.R. 2202 would also have increased the
income a family needed to bring a family member up to a level that denied 40 percent of
Americans the chance to reunite with loved ones.95 The provision was passed by the full
House of Representatives but was eliminated by the conference committeebecause no
vote had been taken in the Senate on this issue. But the measure was again passed as a
92 Ibid.
93 Charles Levendosky, "The Politics of Turning Children into Victims." Casper (Wvo.) Star Tribune. May
1996.
94 Gimpel and Edwards, Immigration Reform.
95 Serrano, House of Representatives, .


39
aliens; and (4) tightened security and screening standards and procedures. President
Truman vetoed the Act because it did not go far enough in removing racial bias from the
immigration process.41
Congress then overrode Truman's veto by a wide margin. In response, President
Truman appointed a commission to study immigration after Congress enacted the
McCarran-Walter Act. The Commissions report thoroughly re-evaluated the American
national identity.42 The Commission concluded that the McCarran-Walter Act was
immoral and exclusionist in an era of emerging civil rights and Cold War challenges 43
The Commission decided that American society was assimilated enough to ensure social
and political stability.44
Senator McCarran expressed a different view and maintained that the nation had
always been besieged by immigrants and that ending the national origins system would
inject further conflict into an ethnically altered United States. This nation is the last
hope of Western Civilization and if this oasis of the world shall be overrun, perverted,
contaminated, or destroyed, then the last flickering light of humanity will be
extinguished.45 McCarran truly wished to end racial discrimination in immigration
admissions, but he felt that the United States could best serve its mission in the world by
4lZiegler, An American Dilemma, pp. 105-115.
42 Ibid., p. 109.
43 Ibid., pp. 108-10.
44 Ibid.
45 Congressional Record, pt. 4, p. 5330 (1952).


125
wages and income were substantial and well documented. Far less attention was given to
the public benefits of education" i.e., to the fact that education was a public good
whose benefits accrued not only to the individual attending school, but also to society as
a whole. Having an educated populace ensured the continuation of American political
systems and values. Public education provided a rationale for government support of
education; in fact, most education at both the K-12 and the postsecondary levels, was
paid for by tax revenues.100
These social, or external, benefits of education exceeded the private benefits, that
is, those enjoyed by the person who gets the education. For example, education led to
reduced crime, improved social cohesion, technological innovations, and inter-
generational benefits (the benefits parents derived from their own education and
transmitted to their children).101
The status of education in society was a direct reflection on the level of
civilization a nation achieved. As civilizations progressed, education became more
important in creating and sustaining economic and social patterns. Therefore, as
immigrants began to fill the nation, they too, required the same basic education as the rest
of society.
99 N. Stacey, Social Benefits of Education, The Annuals of the American Academy, September 1998, pp.
54-63.
100 George Vemez, Richard Krop, and Peter Rydel, Closing the Education Gap: Benefits and Costs, RAND,
1999, p. 13.
102 David C. Thompson, R. Craig Wood, and David S. Honeyman, (1994), Fiscal Leadership for Schools:
Concepts and Practices, Longman, New York.


136
instruction or home language instruction in the
basic subject areas of mathematics, science,
social studies and computer literacy.
(e) Maintain a student plan.
(0 Provide qualified teachers.
(g) Provide equal access to other programs for
eligible limited English proficient students
based on need.
(h) Provide for parent involvement in the
program.24
Floridas Education Strategic Priorities
The mission of Florida's public education system in the year 2000 was to provide
the opportunity for all Floridians to attain the knowledge and skills necessary for lifelong
learning and to become self-sufficient, contributing citizens of society.25
In order to focus education improvement efforts that led to the achievement of
this mission, Commissioner Gallagher provided leadership in the development of a
strategic plan that described the strategic direction for the following priority issues:
Priority Issue 1: Highest Student Achievement. All students, regardless of
environment or economic status, were given the opportunity to attain the highest possible
levels of academic achievement, obtaining the knowledge and skills necessary for
lifelong learning and to become self-sufficient, contributing citizens of society.
Priority Issue 2: Safe Learning Environment. Florida's school sites and settings
were safe and secure places in which to learn.27
24 Ibid., Chapter 233.
25 Office of Organizational and Employee Development, Florida Department of Education (2000).
26 Ibid.
27
Ibid.


APPENDIX
Plyler V. Doe, [457 U.S. 205]
OPINIONS OF THE COURT:
BRENNAN, J., delivered the opinion of the Court, in which MARSHALL,
BLACKMUN, POWELL, and STEVENS, JL, joined. MARSHALL, J., post, p.
230, BLACKMUN, J., post, p. 231, and POWELL, J., post, p. 236, filed concurring
opinions. BURGER, C.J., filed a dissenting opinion, in which WHITE, REHNQUIST,
and O'CONNOR, JJ joined, post. [457 U.S. 205] BRENNAN, J., lead opinion
JUSTICE BRENNAN delivered the opinion of the Court.
The question presented by these cases is whether, consistent with the Equal
Protection Clause of the Fourteenth Amendment, Texas may deny to undocumented
school-age children the free public education that it provides to children who are citizens
of the United States or legally admitted aliens.
Since the late 19th century, the United States has restricted immigration into this
country. Unsanctioned entry into the United States is a crime,1 and those who have
entered unlawfully are subject to deportation.2 But, despite the existence of these legal
restrictions, a substantial number of persons have succeeded in unlawfully entering the
United States, and now live within various states, including the state of Texas.
In May, 1975, the Texas Legislature revised its education laws to withhold from
local school districts any state funds for the education of children who were not legally
1 8 U.S.C. 1325
2 8 U.S.C. 1251, 1252 (1976 ed. and Supp. IV).
146


BIOGRAPHICAL SKETCH
Rose Alvine Raska is a product of Florida schools beginning with the first grade.
She graduated from South Dade High School in Homestead, Florida, in 1966. She then
earned a Bachelor of Arts at the University of South Florida in 1970. Her masters
degree, 1975, came from the University of Central Florida and her education specialist
degree, 1996, from the University of Florida.
She is employed by the Seminole County Public School system as the school-to-
work coordinator and the districts guidance and career development coordinator,
representing seven high schools and 59,000 K-12 students. She is actively involved in
workforce development and strives for all students to learn about the myriad of career
and educational opportunities available to them. Rose has worked full-time
during the pursuit of this Doctor of Philosophy degree.
Rose taught elementary education for three years and then began 30 years of
educational counseling experience (middle school, high school and post-secondary) in the
public school arena.
Her mother, Germaine G. Bourque Raska, inspired Rose to be a lifelong learner.
Rose has five brothers and sisters, all of whom are college educated. Two are certified
public accountants with degrees from Florida state universities.
207


181
require that the State's interests be substantial and that the means bear a fair and
substantial relation to these interests.124
In my view, the State's denial of education to these children bears no substantial
relation to any substantial state interest. Both of the District Courts found that an
uncertain but significant percentage of illegal alien children will remain in Texas as
residents, and many eventually will become citizens. The discussion by the Court of the
State's purported interests demonstrates that they are poorly served by the educational
exclusion.125 Indeed, the interests relied upon by the State would seem to be insubstantial
in view of the consequences to the State itself of wholly uneducated persons living
indefinitely within its borders. By contrast, access to the public schools is made available
to the children of lawful residents without regard to the temporary nature of their
residency in the particular Texas school district. The Court of Appeals and the District
Courts that addressed these cases concluded that the classification could not satisfy even
the bare requirements of rationality.127 One need not go so far to conclude that the
124 Lalli v. Lalli, 439 U.S. 259, 265 (1978) (classifications based on illegitimacy ... are invalid under the
Fourteenth Amendment if they are not substantially related to permissible state interests) Ibid., p. 271 (as
the State's interests are substantial, we now consider the means adopted).
125 [THE CHIEF JUSTICE argues in his dissenting opinion that this heightened standard of review is
inconsistent with the Court's decision in San Antonio Independent School District v. Rodriguez, 411 U.S. 1
(1973). But in Rodriguez, no group of children was singled out by the State and then penalized because of
their parents' status. Rather, funding for education varied across the State because of the tradition of local
control. Nor, in that case, was any group of children totally deprived of all education, as in these cases. If
the resident children of illegal aliens were denied welfare assistance, made available by government to all
other children who qualify, this also in my opinion -- would be an impermissible penalizing of children
because of their parents' status.]
126 [457 U.S. 240]
127 [The State provides free public education to all lawful residents whether they intend to reside
permanently in the State or only reside in the State temporarily, p. 227, n. 22. Of course, a school district
may require that illegal alien children, like any other children, actually reside in the school district before
admitting them to the schools. A requirement of de facto residency, uniformly applied, would not violate
any principle of equal protection.]


124
merits and work ethics.93 He believed that an academic education was the foundation for
all future successes of the individual.
Following Horace Mann and Alexis De. Tocqueville came John Dewey94 who
believed that the individual who is to be educated is a social individual and that society
is an organic union of individuals.95 The lesson to be learned is that human attitudes and
efforts are the strategic center for promotion of the generous aims of peace among
nations; promotion of economic security; the use of political means in order to advance
freedom and equality; and the worldwide cause of democratic institutions. The basic
importance of education is in creating the habits, and the outlook that people are able and
Qfl
eager to secure the ends of peace, and economic stability.
Then, in 1899, the high court of Tennessee saw a need for a uniform system of
public schools to promote the general welfare by educating the people, and thus, by
providing and securing a higher state of intelligence and morals, conserve the peace,
good order and well-being of society.97 Following in 1918, school attendance became
compulsory in every U.S. state.98
The private returns to education received considerable attention in both academic
research and public policy discussion. The positive effects of education on individual
93 Alexis De Tocqueville, Democracy in America (1835) (New York: Alfred A. Knopf, Everymans
Library, 1994), p. 315.
94 John Dewey (1859-1952), U.S. philosopher and educator.
95 Hickman and Alexander, The Essential Dewey, p. 230.
96 John Dewey, Philosophy of Education, p. 80.
97 Leeper v. State, 103 Tenn. 500, 53 S.W. 962 (1899) as cited in Alexander and Alexander, American
Public School Law, p. 24.
98 Alexander and Alexander, American Public School Law. (1992).


180
our country unlawfully.119 The appellee children are innocent in this respect. They can
affect neither their parents conduct nor their own status.120
Our review in a case such as these is properly heightened. The classification at
issue deprives a group of children of the opportunity for education afforded all other
children simply because they have been assigned a legal status due to a violation of law
by their parents.122 These children thus have been singled out for a lifelong penalty and
stigma. A legislative classification that threatens the creation of an underclass of future
citizens and residents cannot be reconciled with one of the fundamental purposes of the
Fourteenth Amendment.123 In these unique circumstances, the Court properly may
119 [Article I, 8, cl. 4, of the Constitution provides: The Congress shall have Power ... To establish an
uniform Rule of Naturalization. The Federal Government has broad constitutional powers in determining
what aliens shall be admitted to the United States, the period they may remain, regulation of their conduct
before naturalization, and the terms and conditions of their naturalization. Takahashi v. Fish & Game
Commission, 334 U.S. 410, 419 (1948). See Graham v. Richardson, 403 U.S. 365, 378 (1971) (regulation
of aliens is constitutionally entrusted to the Federal Government.).
The Court has traditionally shown great deference to federal authority over immigration and to federal
classifications based upon alienage. See, e.g., Fiallo v. Bell, 430 U.S. 787, 792 (1977) (it is important to
underscore the limited scope of judicial inquiry into immigration legislation); Harisiades v. Shaughnessy,
342 U.S. 580, 588-589 (1952) (It is pertinent to observe that any policy toward aliens is vitally and
intricately interwoven with contemporaneous policies in regard to the conduct of foreign relations, the war
power, and the maintenance of a republican form of government. Such matters are so exclusively entrusted
to the political branches of government as to be largely immune from judicial inquiry or interference).
Indeed, even equal protection analysis in this area is based to a large extent on an underlying theme of
preemption and exclusive federal power over immigration. See Takahashi v. Fish & Game Commission, p.
420 (the Federal Government has admitted resident aliens to the country on an equality of legal privileges
with all citizens under nondiscriminatory laws, and the States may not alter the terms of this admission).
Compare Graham v. Richardson, and Sugarman v. Dougall, 413 U.S. 634 (1973), with Mathews v. Diaz,
426 U.S. 67 (1976), and Hampton v. Mow Sun Wong, 426 U.S. 88 (1976). Given that the States' power to
regulate in this area is so limited, and that this is an area of such peculiarly strong federal authority, the
necessity of federal leadership seems evident.]
120 Trimble v. Gordon, 430 U.S. 762, 770 (1977).
121 Ibid., p. 767. Cf. Craig v. Boren, 429 U.S. 190 (1976).
122 [457 U.S. 239]
123 [I emphasize the Courts conclusion that strict scrutiny is not appropriately applied to this classification.
This exacting standard of review has been reserved for instances in which a fundamental constitutional
right or a suspect classification is present. Neither is present in these cases, as the Court holds.]


132
informed by legitimate experimental strategy.15 Second, the court must establish
whether the programs and practices actually used by the school system were reasonably
calculated to implement effectively the educational theory adopted by the school.76
And, third, the court must determine whether the schools program, although premised on
sound educational theory and effectively implemented, produced results indicating that
the language barriers confronting students were actually being overcome.17
In Castaneda v. Pickard118 (1986) the Court reiterated that Congress, in enacting
Section 1703 (f), intended to leave the state and federal educational authorities a
substantial amount of latitude in choosing the programs and techniques they would use.
In Keyes v. School District No.l, 19 the Castaneda test was applied to the Denver public
schools and the Court noted that the law did not require perfection, but the districts had a
duty to take appropriate action to eliminate language barriers that prevented students
from participating equally in educational programs. In the Teresa P. v. Berkeley Unified
School District20, the three-pronged standard was utilized. The District Court held that
the EEOA did not require a school district to adopt a specific educational theory or to
implement an ideal academic program. It solely required the district to make a good faith
effort to provide teachers competent to teach English as a Second Language (ESL), and
14 Castaneda v. Pickard, (1981) 648 F.2d 989.
15 Ibid., p. 1009.
16 Ibid., p. 1010.
17 Ibid.
18 Castaneda v. Pickard, (1986) 781 F 2d 456 (Castaneda II).
19 Keyes v. School District No.l, (1983) 724 F. Supp. 1503.
20 Teresa P. v. Berkeley Unified School District, (1989) 724 F. Supp. 698.


35
1920s legislation sought to preserve the European heritage as it had developed in the
United States without identifying our nation with modem Europe.24
The 1890 census served as a temporary provision until Congress established the
final national origins system in 1929.25 Thereafter, Congress set the national origins
quota at one-sixth of one percent of the 1920 population to arrive at a base figure of
153,714.26 The 1920s legislation effectively stopped large-scale immigration to the
United States for forty years.
A great reduction in anti-immigrant hysteria followed the 1920s legislation.
Yet, the tendency of Americans to intermarry continued among second and third
generation Americans.27 These unions became more visible and accepted in the absence
of mass immigration. The effects of such personal assimilation spread and gradually
became a recognized and comfortable feature of American life. America began to
celebrate immigrants rather than fear them.28
The Statue of Liberty was a famous example of the emerging confidence in
American assimilative capacity and the resulting embrace of Americas immigrant
heritage. Originally a gift from France meant to symbolize the Franco-American
20
relationship, the statue symbolized Americas light of liberty illuminating the world.
24 Maldwyn A. Jones, American Immigration, 249-55 (2nd ed. 1992).
25 Act of July I, 1929, ch. 306,45 Stat.400.
26 John Higham, Strangers in the Land: Patterns of American Nativism 1860-1925 p. 321 (1955).
27 Arthur M. Schlessinger, Jr., The Disuniting of America 19, 133 (1993).
28 Ibid.
29 Thomas A. Aleinikoff, The Tightening Circle of Membership, 22 Hastings Const. L.Q. 915 (1995).


86
separate bill in the House.46 One version of the proposal would have denied public
education to children who were illegal aliens themselves, rather than all children of
illegal aliens (which would have included some U.S. bom, citizen children). The bill
failed to address the fact that employment was the primary reason immigrants, whether
legal or illegal, came to this country.97
Supporters of the Gallegly Amendment argued that America's education system,
like other social-service programs, attracted a disproportionate number of immigrants and
that the cost of educating such children was too high in an era of tight school budgets.
Opponents of the measure denounced it as cruel; hundreds of thousands of children
would potentially be turned away at the schoolhouse door.98
A portion of the Gallegly amendment read:
Congress declares it to be the policy of the United States
that... aliens who are not lawfully present in the United States not
be entitled to public education benefits in the same manner as
United States citizens and lawful; resident aliens ..
The House bill allowed states to make their own determination about whether the
public schools would be open to children of illegal immigrants. The amendment did not
provide for Immigration and Naturalization Service officials to enter schools and it did
not provide funds for schools to hire people. The public schools have traditionally
96 Charles Levendosky, The Politics of Turning Children into Victims. Casper (W\o.) Star Tribune. May
1996.
97 Gimpel, James G. and Edwards, James R. Jr., 1999. The Congressional Politics of Immigration Reform,
Needham Heights, MA, Allyn & Bacon.
98 Illegal Immigrant Children: In or Out of Public Schools? Education Week, April 1996.
.
99 Gallegly Amendment, H. R. (2022), 1996.


embodied in the Equal Protection Clause.52 What we said 28 years ago, in Brown v.
Board of Education57' still holds true:
163
Today, education is perhaps the most important function of state
and local governments. Compulsory school attendance laws and
the great expenditures for education both demonstrate our
recognition of the importance of education to our democratic
society. It is required in the performance of our most basic public
responsibilities, even service in the armed forces. It is the very
foundation of good citizenship. Today it is a principal instrument
in awakening the child to cultural values, in preparing him for later
professional training, and in helping him to adjust normally to his
environment. In these days, it is doubtful that any child may
reasonably be expected to succeed in life if he is denied the
opportunity of an education. Such an opportunity, where the state
has undertaken to provide it, is a right which must be made
available to all on equal terms.54 B
These well-settled principles allow us to determine the proper level of deference
to be afforded 21.031. Undocumented aliens cannot be treated as a suspect class,
because their presence in this country in violation of federal law is not a constitutional
irrelevancy. Nor is education a fundamental right; a State need not justify by
compelling necessity every variation in the manner in which education is provided to its
52 [Because the State does not afford noncitizens the right to vote, and may bar noncitizens from
participating in activities at the heart of its political community, appellants argue that denial of a basic
education to these children is of less significance than the denial to some other group. Whatever the current
status of these children, the courts below concluded that many will remain here permanently, and that some
indeterminate number will eventually become citizens. The fact that many will not is not decisive, even
with respect to the importance of education to participation in core political institutions. [T]he benefits of
education are not reserved to those whose productive utilization of them is a certainty.... 458 F.Supp. p.
581, n. 14. In addition, although a noncitizen may be barred from full involvement in the political arena, he
may play a role perhaps even a leadership role in other areas of import to the community. Nyquist v.
Mauclet, 432 U.S. 1, 12 (1977). Moreover, the significance of education to our society is not limited to its
political and cultural fruits. The public schools are an important socializing institution, imparting those
shared values through which social order and stability are maintained.
53 347 U.S. 483(1954). Ed.]
54
457 U.S. 493


69
percent were available for immigrants from countries that had received relatively few
visas in previous years.36
Table 3-1 Immigration to the U.S. in 1992
Relatives of U.S. citizens and
permanent residents
520,000
Skilled workers and their families.
140,000
Citizens from countries with
few recent immigrant visas
40,000
Political refugees
141,000
Illegal Aliens (estimate)
200.000
TOTAL
1,041,000
Source: U.S. Immigration & Naturalization Service, 1993
Illegal Aliens
Although exact numbers were difficult to determine, research indicated that more
than 200,000 illegal aliens settled permanently in the United States each year.37 Many
arrived legally as students or tourists and then stayed beyond the limitations of their
visas. Others used false documents to slip past immigration officials. The majority,
however, entered the country by crossing the U.S.-Mexican border, making the problem
of illegal aliens, in many respects, a question of foreign policy.
Illegal aliens and border control were relatively new concepts in the history of U.S.
immigration. Until 1968, there were no official limits on immigration from countries in
35 Immigration Act of 1990, P.L. 101-649. 104 Stat. 4978. The 675.000 level was to consist of 480,000
family-sponsored, 140,000 employment-based, and 55,000 diversity immigrants.
36 Gimpel and Edwards, The Congressional Politics.
37
Ibid.


114
As a subset of the immigrant population, undocumented children were likely to
confront the most distressing experiences of all. In addition to the usual experiences of
growing up, and the unusual stress of immigration, undocumented immigrant children
worried about deportation.48 If their undocumented status was discovered, the
Immigration and Naturalization Service (INS) had the legal authority to investigate them.
Further, the INS could have detained them, apart from their families, in federally
operated centers.49
Since the Plyler'0 decision, states could no longer use residency requirements to
deny undocumented children access to a tuition-free public education. Under Plyler,
undocumented immigrant students had the same right to attend public schools through
Grade 12, as did citizens and permanent residents.
School staff needed to be aware and sensitive as they dealt with all immigrant
students. In particular, they acted to preserve the right of access, especially by guarding
the confidentiality of students immigration status. In fact, if an undocumented student
reasonably perceived that an action had the intent of exposing immigration status, then
the right of access was compromised.51
Plyler, moreover, required that schools applied the right of access to all immigrant
students. This step guarded against improper distinctions between documented and
48 Ibid.
49 J. Morales, Improvements Ahead in INS Treatment of Detained Children, Youth Law News, 8(3), 1
(1987).
50 Plyler v. Doe, 457 U.S. 202 (1982).
51 J. Willshire Carrera, Educating Undocumented Children: A Review Of Practices And Policies (Trends
and Issues Paper). Charleston, WV, (ERIC Clearinghouse on Rural Education and Small Schools, 1989).


115
undocumented students.52 The right of access implied that undocumented students also
had access to appropriate special programs available to other students. School staff were
not to: (1) Ask about a students immigration status or request documentation at any
time; (2) Bar access to a student on the basis of undocumented status or alleged
undocumented status; (3) Treat one student differently from others in order to determine
residency, or on the basis of undocumented status; (4) Make inquires of a student from
others in order to determine residency; (5) Make inquiries of a student or parent that
might expose the undocumented status of either; or (6) Require undocumented students
or their parents to apply for Social Security numbers.53
Willshire Carrera in his review of practices and policies,54 recommended that, in
responding to the needs of undocumented students, school staff should have: understood
the troubled nature of immigrants daily lives; understood and actively provided the right
of access established by Plyler; established a school climate that all immigrant students
found open and hospitable; provided counseling and guidance that was responsive to the
conditions of immigrant students lives; developed policies and practices that
strengthened immigrant students access to effective instruction; respected immigrant
communities native languages and cultures, at the same time, helped immigrant students
to learn English; hired, trained, and retained competent staff who provided appropriated
52 Ibid.
53 Because undocumented students are not eligible for Social Security numbers, schools may not require
them as a condition of enrollment.
54 J. Willshire Carrera, Educating Undocumented Children: A Review Of Practices And Policies (Trends
and Issues Paper). Charleston, WV, (ERIC Clearinghouse on Rural Education and Small Schools, 1989).


xml version 1.0 encoding UTF-8
REPORT xmlns http:www.fcla.edudlsmddaitss xmlns:xsi http:www.w3.org2001XMLSchema-instance xsi:schemaLocation http:www.fcla.edudlsmddaitssdaitssReport.xsd
INGEST IEID E4IJ09VVW_QZWRL4 INGEST_TIME 2014-07-22T22:08:19Z PACKAGE AA00017699_00001
AGREEMENT_INFO ACCOUNT UF PROJECT UFDC
FILES


137
Priority Issue 3: Increased Government Efficiency. Florida's public education
system worked with all stakeholders to develop and continually improve a systematic
process for maximizing its effectiveness in meeting the needs of its citizenry.
Policy Enhancements
State education policy made it clear to all district school personnel that, as
educators, their primary responsibility was to provide all students who were residents of
their community with a quality education. In responding to the needs of undocumented
students, Florida state policy needed to continue its mandated federal and state programs
and strategies. To be considered in addition were:
1) Immigrant student inclusion in all school and district assessments and reports;
Florida state school board policies allowed for special accommodations
for the LEP student. Accommodations included giving additional time to
complete the test, use of an Heritage language-to-English dictionary, the
opportunity to be tested separately with other LEP students, and the ESOL
teacher was permitted to answer general test direction questions in the
heritage language. In addition to separating LEP student scores for
documentation and benchmarking purposes, their test scores needed to be
indicated inclusively as part of the overall assessment reports. Score
inclusion should be limited to those LEP students who had been receiving
ESOL classes for a minimum of two years.
2) Greater staff participation in training directed toward understanding of the
special needs of immigrant children;
28
Ibid.


147
admitted into the United States. The 1975 revision also authorized local school districts
to deny enrollment in their public schools to children not "legally admitted" to the
country.3 These cases involve constitutional challenges to those provisions.
[457 U.S. 206]4
That section provides, in pertinent part:
(a) All children who are citizens of the United States or legally
admitted aliens and who are over the age of five years and under
the age of 21 years on the first day of September of any scholastic
year shall be entitled to the benefits of the Available School Fund
for that year.
(b) Every child in this state who is a citizen of the United States
or a legally admitted alien and who is over the age of five years
and not over the age of 21 years on the first day of September of
the year in which admission is sought shall be permitted to attend
the public free schools of the district in which he resides or in
which his parent, guardian, or the person having lawful control of
him resides at the time he applies for admission.
(c) The board of trustees of any public free school district of this
state shall admit into the public free schools of the district free of
tuition all persons who are either citizens of the United States or
legally admitted aliens and who are over five and not over 21 years
of age at the beginning of the scholastic year if such person or his
parent, guardian or person having lawful control resides within the
school district.
Plyler v. Doe was a class action, filed in the United States District Court for the
Eastern District of Texas in September, 1977, on behalf of certain school-age children of
Mexican origin residing in Smith County, Texas, who could not establish that they had
3 [Texas Education Code Ann. 21.031 (Vernon Supp.1981) Despite the enactment of 21.031 in 1975, the
School District had continued to enroll undocumented children free of charge until the 1977-1978 school
year. In July, 1977, it adopted a policy requiring undocumented children to pay a full tuition fee in order
to enroll. Section 21.031 had not provided a definition of a legally admitted alien. Tyler offered the
following clarification: A legally admitted alien is one who has documentation that he or she is legally in
the United States, or a person who is in the process of securing documentation from the United States
Immigration Service, and the Service will state that the person is being processed and will be admitted with
proper documentation. App. to Juris. Statement in No. 80-1538, p. A-38. Ed.]
4 457 U.S. 206. No. 8158 Plyler v. Doe.


195
Congress, vested by the Constitution with the responsibility of protecting our
borders and legislating with respect to aliens,174 bears primary responsibility for
addressing the problems occasioned by the millions of illegal aliens flooding across our
southern border. Similarly, it is for Congress, and not this Court, to [457 U.S. 254] assess
the social costs bome by our Nation when select groups are denied the means to absorb
the values and skills upon which our social order rests.175 While the specter of a
permanent caste of illegal Mexican residents of the United States is indeed a disturbing
one, it is but one segment of a larger problem, which is for the political branches to solve.
I find it difficult to believe that Congress would long tolerate such a self-destructive
result that it would fail to deport these illegal alien families or to provide for the
education of their children. Yet instead of allowing the political processes to run their
course albeit with some delay the Court seeks to do Congress job for it,
compensating for congressional inaction. It is not unreasonable to think that this
encourages the political branches to pass their problems to the Judiciary, (end of
BURGER, J., dissenting.)
Thayers observation that the exercise of [the power of judicial review], even when unavoidable, is always
attended with a serious evil, namely, that the correction of legislative mistakes comes from the outside, and
the people thus lose the political experience, and the moral education and stimulus that comes from fighting
the question out in the ordinary way, and correcting their own errors. The tendency of a common and easy
resort to this great function, now lamentably too common, is to dwarf the political capacity of the people,
and to deaden its sense of moral responsibility. Ibid., p. 22 (quoting J. Thayer, John Marshall 106-107
(1901)]
174 Ibid., p. 237 (POWELL, J., concurring).
175 Ibid., p. 221


57
Table 2-1 Timeline of U.S. Immigration and Alien Education Policies
1790
Naturalization Rule adopted. Federal government established a two-year residency
requirement on immigrants wishing to become u.s. citizens.
1819
Reporting Rule adopted. Data began to be collected on immigration into the United
States. Ships captains and others were required to keep and submit manifests of
immigrants entering the U.S.
1875
First Exclusionary Act. Convict, prostitutes, and coolies (Chinese contract
laborers) were barred from entry into the United States.
1882
Immigration Act passed. The federal government moved to firmly establish its
authority over immigration. Chinese immigration was curtailed; ex-convicts, lunatics,
idiots, and those unable to take care of themselves were excluded. In addition, a tax
was levied on newly arriving immigrants.
1885
Contract laborers' entry barred. This legislation reversed an earlier federal law
legalizing the trade in contract labor.
1891
Office of Immigration created. Established as part of the U.S. Treasury Department,
this new office was later given authority over naturalization and moved to the U.S.
Justice Department. (It was known as the Immigration and Naturalization Service.) In
the same year, paupers, polygamists, the insane, and persons with contagious diseases
were excluded from entry to the United States.
1892
Ellis Island opened. Between 1892 and 1953, more than 12 million immigrants were
processed at this one facility.
1903
Additional categories of persons excluded. Epileptics, professional beggars, and
anarchists were now excluded.
1907
Exclusions further broadened. Imbeciles, the feebleminded, tuberculars, persons with
physical or mental defects, and persons under age 16 without parents were excluded.
1907
"Gentleman's Agreement" between United States and Japan. An informal agreement
curtailed Japanese immigration to the United States. Also, the tax on new immigrants
was increased.
1917
Literacy Test introduced. All immigrants 16 years of age or older must have
demonstrated the ability to read a forty-word passage in their native language. Also,
virtually all Asian immigrants were banned from entry into the United States.
1921
Quota Act. An annual immigration ceiling was set at 350,000. Moreover, a new
nationality quota was instituted, limiting admissions to 3 percent of each nationality
group's representation in the 1910 census. The law was designed primarily to restrict
the flow of immigrants coming from eastern and southern Europe.
1923
Meyer v. Nebraska. U.S. Supreme Court decision struck down an earlier Nebraska
statute barring individuals and schools from providing instruction in a language other
than English to any student who had not completed the eighth grade.
1924
Origins Act. The Act reduced the annual immigration ceiling to 165,000. A revised
quota reduced admissions to 2 percent of each nationality group's representation in the
1890 census. The U.S. Border Patrol was created.
1927
Immigration Ceiling Further Reduced. The annual immigration ceiling was further
reduced to 150,000; the quota was revised to 2 percent of each nationality's
representation in the 1920 census. This basic law remains in effect through 1965.


72
Figure 3-1 Top Ten States Where Illegal Aliens Reside
The same states that were burdened by the social service needs of illegal aliens,
however, were also home to the businesses that employed them. Some employers
contended that Americans were unwilling to work hard for low wages. Whether stitching
pants in a clothing factory, washing dishes in a restaurant, or harvesting fruits and
vegetables, illegal aliens had become a crucial element of the work force in many areas.
Critics of the practice maintained that some employers preferred hiring undocumented
workers because they were least likely to complain about low pay and poor working


I certify that I have read this study and that in my opinion it conforms to
acceptable standards of scholarly presentation and is fully adequate, in scope and quality,
as a dissertation for the degree of Doctor of Philosophy.
Jr., Chair
Professor of Educational Leadership,
Policy, and Foundations
I certify that I have read this study and that in my opinion it conforms to
acceptable standards of scholarly presentation and is fully adequate, in scope and quality,
as a dissertation for the degree of Doctor of Philosophy.
M. David Miller
Professor of Educational Psychology
I certify that I have read this study and that in my opinion it conforms to
acceptable standards of scholarly presentation and is fully adequate, in scope and quality,
as a dissertation for the degree of Doctor of Philosophy.
Walter L. Srffith
Professor of Educational Leadership,
Policy, and Foundations
I certify that I have read this study and that in my opinion it conforms to
acceptable standards of scholarly presentation and is fully adequate, in scope and quality,
as a dissertation for the degree of Doctor of Philosophy.
Learning


186
education. If ever a court was guilty of an unabashedly result-oriented approach, this
case is a prime example.139 (1)
The Court first suggests that these illegal alien children, although not a suspect
class, are entitled to special solicitude under the Equal Protection Clause because they
lack control over or responsibility for their unlawful entry into this country.140
Similarly, the Court appears to take the position that 21.031 is presumptively irrational
because it has the effect of imposing penalties [457 U.S. 245] on innocent
children.141 However, the Equal Protection Clause does not preclude legislators from
classifying among persons on the basis of factors and characteristics over which
individuals may be said to lack control. Indeed, in some circumstances, persons
generally, and children in particular, may have little control over or responsibility for
such things as their ill health, need for public assistance, or place of residence. Yet a
state legislature is not barred from considering, for example, relevant differences between
the mentally healthy and the mentally ill, or between the residents of different counties
simply because these may be factors unrelated to individual choice or to any
wrongdoing. The Equal Protection Clause protects against arbitrary and irrational
classifications, and against invidious discrimination stemming from prejudice and
139 [It does not follow, however, that a state should bear the costs of educating children whose illegal
presence in this country results from the default of the political branches of the Federal Government. A
state has no power to prevent unlawful immigration, and no power to deport illegal aliens; those powers are
reserved exclusively to Congress and the Executive. If the Federal Government, properly chargeable with
deporting illegal aliens, fails to do so, it should bear the burdens of their presence here. Surely if illegal
alien children can be identified for purposes of this litigation, their parents can be identified for
purposes of prompt deportation.]
140 Ibid., p. 220.
141 Ibid., (POWELL, J., concurring).


154
97
of a State. Our cases applying the Equal Protection Clause reflect the same territorial
theme: Manifestly, the obligation of the State to give the protection of equal laws can be
performed only where its laws operate, that is, within its own jurisdiction. It is there that
the equality of legal right must be maintained. That obligation is imposed by the
Constitution upon the States severally as governmental entities, each responsible for its
own laws establishing the rights and duties of persons within its borders.29 There is
simply no support for appellants suggestion that due process is somehow of greater
stature than equal protection, and therefore available to a larger class of persons. To
the contrary, each aspect of the Fourteenth Amendment reflects an elementary limitation
on state power. To permit a State to employ the phrase within its jurisdiction in
identifying subclasses of persons whom it would define as beyond its jurisdiction,
thereby relieving itself of the obligation to assure that its laws are designed and applied
equally to those persons, would undermine the principal purpose for which the Equal
Protection Clause was incorporated in the Fourteenth Amendment. The Equal Protection
27 Wong Wing, p. 238. [In his separate opinion, Justice Field addressed the relationship between the Fifth
and Fourteenth Amendments: The term "person," used in the Fifth Amendment, is broad enough to include
any and every human being within the jurisdiction of the republic. A resident, alien born, is entitled to the
same protection under the laws that a citizen is entitled to. He owes obedience to the laws of the country in
which he is domiciled, and, as a consequence, he is entitled to the equal protection of those laws.... The
contention that persons within the territorial jurisdiction of this republic might be beyond the protection of
the law was heard with pain on the argument at the bar in face of the great constitutional amendment
which declares that no State shall deny to any person within its jurisdiction the equal protection of the laws.
Wong Wing v. United States, 163 U.S. pp. 242-243 (concurring in part and dissenting in part). Ed.]
28 457 U.S. 213. [Leng May Ma v. Barber, 357 U.S. 185 (1958), relied on by appellants, is not to the
contrary. In that case, the Court held, as a matter of statutory construction, that an alien paroled into the
United States pursuant to 212(d)(5) of the Immigration and Nationality Act, 8 U.S.C. 1182(d)(5) (1952
ed.), was not within the United States for the purpose of availing herself of 243(h), which authorized the
withholding of deportation in certain circumstance. The conclusion reflected the longstanding distinction
between exclusion proceedings, involving the determination of admissibility, and deportation proceedings.
The undocumented children who are appellees here, unlike the parolee in Leng May Ma, could apparently
be removed from the country of pursuant to deportation proceedings. 8 U.S.C. 1251(a)(2). Seel AC.
Gordon & H. Rosenfield, Immigration Law and Procedure 3.16b, p. 3-161 (1981). Ed.]
29 Missouri ex rel. Gaines v. Canada, 305 U.S. 337, 350 (1938).


38
develop a common social nucleus.36 Education helped form new social patterns by
providing access to middle class professions and by easing social barriers to the extent
that intermarriage was common among middle class young people.37
The forty-year break in immigration protected, supported, and developed a
shifting and evolving common culture and, simultaneously, anchored the core values
necessary to maintain a workable society. The objectionable racist and eugenic
appearance of the 1920s legislation should not blind us to the positive results of a forty-
year immigration lull.38 Whatever the drafters of the 1920s legislation intended, it
reduced social tensions and sustained the assimilative relationship between intermarriage
and core values.
The 1952 Immigration Act
In 1952, the McCarran-Walter Act39 basically altered the immigration policy of
the United States. The 1952 Immigration and Nationality Act (official name) retained the
1920 quota base. It removed racial bias from the setting of national origins quotas since
particular immigrants could not be excluded on account of race.40 The Act also: (1)
reaffirmed the national origins quota system; (2) limited immigration from the Eastern
Hemisphere while leaving the Western Hemisphere unrestricted; (3) established
preferences for skilled workers and relatives of U.S. citizens and permanent resident
36 Ibid., p. 53-55.
37 Karst, as quoted in Van de Mark, p. 335.
38 Aleinikoff, The Tightening Circle p. 49.
39 McCarran-Walter Act, ch.477, 66 Stat. 163, 8 U.S.C. § 1101 et seq. as amended throughout 8 U.S.C.
40
Ibid.


139
Florida had assessment instruments available in Spanish, though they were
not widely used in all districts. Lack of uniform or consistent utilization
caused flawed results in overall test scores, by improperly measuring
student achievement. Resources were available to assist LEP students test
interpretation, but no correct answers could be given. Florida needed to
develop assessment instruments in Haitian Creole as Haiti accounted for
17 percent of undocumented immigrants in 1993. The highest percentage
of illegal immigrants was from Hispanic speaking countries. It was
difficult to find experts in many of the other language fields.
5) Increased school counseling services for immigrant children;
Counseling services were available to immigrant children, but few took
advantage due to the language barrier problem. Many Florida school
districts experienced a shortage of bi-lingual school counselors. Increased
recruitment efforts in this area were necessary, as well as for male
counselors to serve as role models for Hispanic and other immigrant
youth. Incentives for existing school counselors and teachers to learn to
communicate with students in a language other than English were needed.
The inclusion of additional training in the understanding the culture, and
experiences of the undocumented immigrant child was indicated. By
2005, the school-age population of white students would have declined by
3 percent, while an increase would be experience by African American
students (8 percent), Hispanic students (30 percent), Asian and Pacific


10
more than re-establish the immigration levels of the decade of the 1980s, the highest ever
in the country's history up to that time.
Immigration Statistics
In 1994, the Immigration and Naturalization Service (INS) released detailed
estimates of the undocumented immigrant population in the United States as of October
1992. Those estimates were useful for a variety of purposes, including planning and
policy development at the national and state level, evaluating the effects of proposed
legislation, and assessing the fiscal impact of undocumented immigration. Between 1994
and October 1996, the INS revised and updated those estimates. As of October 1996, an
estimated 5 million undocumented immigrants were residing in the United States. An
estimated 350,000 undocumented aliens lived in Florida. The undocumented immigrant
population was estimated to be growing by about 275,000 each year, which was about
25,000 lower than the annual level of growth estimated by the INS in 1994.
California was the leading state of residence with 2 million, or 40 percent of the
undocumented population. The seven states with the largest estimated numbers of
undocumented immigrants in 1994 including California were Texas (700,000), New York
(540,000), Florida (350,000), Illinois (290,000), New Jersey (135,000), and Arizona
(115,000). These seven states accounted for 83 percent of the total undocumented
population in October 1996.38
From 1960 to 1997, the foreign-bom population increased from 1.3
million to 8.1 million in California, and from 0.3 million to 2.4 million in Florida, and
37 Illegal Alien Resident Population 23 November 1997.
38
Ibid.


112
lived in Florida. The majority of Floridas immigrants at that time came from the
Caribbean basin. Mexico played a minor role in the settlement pattern.42
Floridas undocumented alien students came from a diverse mix of cultures and
backgrounds.
17%
Haiti
17%
Bahamas
9%
Canada
00
Nicaragua
7%
Mexico
6%
Jamaica
5%
Columbia
3%
Honduras
00
Other
Source: The Unfair Burden, Florida Governors Office, March 1994
Figure 4-1 Estimated Undocumented Immigrant Population in Florida in 1993
by Country of Origin
Florida received federal assistance to help defray the costs of the incarcerated
criminal alien population in the state and to help with welfare benefits that the state had
to pay after the 1986 amnesty for illegal aliens.42 The federal funding fell short of the
42 Ibid.
43 Immigration Reform and Control Act, Pub. L. No. 99-603, 100 Stat. 3359 (1986).


88
U.S. natives. As they completed their public education, many chose to pursue their
education further and enrolled in colleges and universities. Although immigrants were
less likely to have graduated from high school, they were more likely to graduate from
college when compared to the U.S. native population.102
Justice Brennan103 used the inherent difficulty of immigration control as a
justification for making it even more intractable. He assumed that exclusion from the
schools was a wholly ineffective way to influence immigrants' behavior, yet it was surely
true that at least some parents were less likely to immigrate if they knew their children
would be denied schooling. Illegal aliens always had alternatives. They could return
home or refrain from coming in the first place. These options seemed harsh but they
followed directly from the premise of national territorial sovereignty, a premise that the
Court had always affirmed.104
While the federal government moved to curb illegal migrants, it never cut off
many of their benefits, notably including public education in federally assisted schools
and emergency Medicaid services. The courts could have taken this inaction to mean that
Congress remained satisfied with Plyler and did not wish to undermine the decision's
rationale.105
Political leaders needed to recognize that illegal immigration was not an
unmitigated evil and that immigration enforcement competed for resources with other
102 Schuck, Illegal Immigration, pp. 85-92.
103 Ibid.
104 Ibid.
105
Ibid.


103
Federal statutes and case law required school districts to take appropriate action to
overcome language barriers that impeded student achievement. The specific action was
left to the discretion of the school district so long as it was based on: 1) a sound
educational theory; 2) sufficient resources implemented to enact the theory; and 3) if after
a period of time students were not making progress, a different approach was provided to
the students. The federal laws required staff members to have training and experience in
English language acquisition skills; it also required that assessment programs be
meaningful and validated. Financial responsibility for funding the federal mandates
remained with the state of Florida. Each district decided how it would deal with meeting
immigrant student educational needs within its confines.
Education Finance
In 1823, Congress resolved that the Ways and Means Committee inquire into the
expediency of appropriating and setting apart a portion of the avails of the annual sales of
the public lands for the purpose of establishing a permanent increasing fund, the interest
of which,... shall be distributed for the promotion of education in the several States,
according to the principals of equal right and justice.14
From this minimal beginning, some difficult issues involving finance arose
through time as educational institutions and agencies attempted to provide services to
immigrants. How should the funds needed to cover the added costs of educating
immigrants be generated? Should immigrant education programs be separately
authorized from comparable programs serving the native-born student? Do immigrants
14 Annals of Congress. House of Representatives, 17th Congress, 2nd session, U.S. Congressional
Documents and Debates, 1774-1873, pp. 959-960.


14
Immigrant Education
An additional Supreme Court decision with implications for immigrant children
was Lau v. Nicols, rendered in 1974.47 This case focused on the rights of non-English
speaking children and the corresponding duties of public schools to address these
students' unique needs. Specifically, Chinese students asserted that the San Francisco
public school program violated the equal protection clause of the Fourteenth Amendment
and Title VI of the Civil Rights Act of 196448 by failing to make adequate provisions for
the needs of students with English language deficiencies. The Court held that the lack of
sufficient remedial English instruction violated Title VI, which prohibited discrimination
on the basis of race, color, or national origin in institutions with federally assisted
programs.49 The court held that equal opportunities were not provided by giving
students the same textbooks, teachers, and curriculum. Further, requiring children to
acquire English skills on their own before they could hope to make any progress in
school made a mockery of public education.50 Emphasizing that basic English skill is
at the very core of what these public schools teach,51 the Court concluded students who
do not understand English are effectively foreclosed from any meaningful education.52
A1Lau v. Nichols, 414 U.S. 563 (1974).
48 Civil Rights Act of 1964, Pub. L. No. 88-352, 78 Stat. 241.
49 42 U.S.C. § 2000(d).
50 414 U.S. at 566.
si
52
Ibid.


24
immigrants at $62.7 billion. In the study, funded by the Carrying Capacity Network,
Huddle said immigrants paid only $20 billion in taxes.86
There was no comprehensive rule that restricted direct federal assistance or
federally funded assistance on the basis of immigration status. This was true both with
respect to legal permanent residents who entered under the admission system of the
Immigration and Nationality Act of 198687 and to aliens who entered or remained in
violation of the law.88
Those restrictions that did exist had been enacted on a program-by-program basis,
beginning in the 1970s. Most existing restrictions denied assistance to aliens who were
here without legal permission.89
Immigration policies were made at the federal level and addressed broad issues
such as quotas and enforcement of immigrant requirements. Immigrant policies, on the
other hand, were made at the state level and focused on immigrants already residing in
the United States. Immigrant policy makers dealt with how to integrate immigrants into
the American population and assist them with public benefits during the transition.90
There were three basic policy issues concerning education and immigration:
education of illegal alien children, the volume of legal immigration and the strain it put
86 Donald Huddle 1994, The Net National Costs of Immigration in 1993" June 1994. This was a
comprehensive nationwide study of the fiscal impact of immigration.
87 Immigration Reform and Control Act, Pub. L. 99-603, 100 Stat. 3359 (1986).
88 McDonnell, and Hill, RAND, MR-103-AWM/PRIP, 1993.
89 Ibid.
90 Roco Del Sagrario Toriz , Federal and State
Responsibility for Undocumented Immigration, Berkeley McNair Journal Three, no. Summer 1995 (1995)
.


129
aliens into legal permanent residents. The state government estimated the illegal alien
population higherabout 420,000.4
The exact number of immigrant students attending Florida public schools was
unknown in 1996 or in 2000. The number of immigrant students enrolled in special or
gifted student programs was also unknown. The difficulty in identifying the number of
immigrant students was due in part to the August, 1990 Consent Decree5 signed by the
Florida Commissioner of Education, Department of Education and the state board of
Education with the Multicultural Education training Advocacy, Inc., that prohibited
education officials from requesting certain information on the residency status of the
students family.
Federal Policies and Laws
In 1982, the Supreme Court ruled in Plyler V. Doe, that public schools were
prohibited from denying immigrant students access to a public education from
kindergarten through grade 12 on the basis of their immigration status. More
specifically, the Court found that undocumented immigrant children and young adults
had the same right to attend free public elementary and secondary schools as their U.S.
citizen counterparts. As such, states and the public schools in each state were prohibited
from enacting or adopting laws, regulations, or practices which denied or resulted in the
denial of this right.6
4 Florida: Illegal Immigration, December 1998 .
5 League of United Latin American Citizens (LULAC) et al. v. the State Board of Education et al. Consent
Decree, U.S. District Court for the Southern District of Florida, August 14, 1990.
6 John Willshire Carrera, Immigrant Students: Their Legal Right of Access to Public Schools, (1992).
National Coalition of Advocates for Students, Boston, MA.


120
John Dewey (1859-1952) once called the guide, the mentor, and the conscience
of the American people...73 often spoke on major issues of his time. He was considered
an educational innovator and believed in the education of all children as a benefit to
society.
The idea of free and common schools developed among us on the grounds that a
nation of truly free men and women required schools open to all and hence supported by
public taxation.74 Upon the whole, considerable progress has been made in making
schooling accessible to all, thought it is still true that the opportunity to take advantage of
what is theoretically provided for all is seriously limited by economic status.75
Horace Mann, an educational reformer instrumental in establishing the first normal
school in the U.S. in 1839, once said Education is our only political safety: outside of
this ark is the deluge76 He was also quoted by Dewey as saying that: The Common
School is the greatest discovery ever made by man. Other social organizations are
curative and remedial. This is preventive and antidote.77
The institution for which Horace Mann labored, namely, a public school system
supported by public taxation and open to all children, had over the passage of more than
hundred years been realized to a surprising degree. Education was designed to serve the
needs of the democratic society and of the democratic way of life.
73 Larry A. Hickman and Thomas M. Alexander, The Essential Dewey, Indiana University Press,
Bloomington, Ind. (1998).
74 John Dewey, Philosophy of Education, New Jersey: Littlefield, Adams & Co. p. 122 (1958).
75 Ibid.
76 Ibid., p. 46.
77
Ibid.


177
107
Similarly, it is undeniable that education is not a fundamental right in the sense that
it is constitutionally guaranteed. Here, however, the State has undertaken to provide an
education to most of the children residing within its borders. And, in contrast to the
situation in Rodriguez, it does not take an advanced degree to predict the effects of a
complete denial of education upon those children targeted by the State's classification. In
such circumstances, the voting decisions suggest that the State must offer something
more than a rational basis for its classification.
Concededly, it would seem ironic to discuss the social necessity of an education
in a case that concerned only undocumented aliens whose very presence in the state and
this country is illegal.108 But because of the nature of the federal immigration laws and
the preeminent role of the Federal Government in109 regulating immigration, the class of
children here is not a monolithic one. Thus, the District Court in the Alien Children
Education case found as a factual matter that a significant number of illegal aliens will
remain in this country permanently,110 that some of the children involved in this litigation
are documentable,111 and that [m]any of the undocumented children are not
deportable. None of the named plaintiffs is under an order of deportation. As the
Court's alienage cases demonstrate, these children may not be denied rights that are
107 Ibid., p. 223.
108 Inf. p. 250 (BURGER, C.J., dissenting).
109 [457 U.S. 236]
110 501 F.Supp. 544, 558-559 (SD Tex.1980).
111 Ibid., p. 573.
112 Ibid., p. 583, n. 103.


175
political process. Those denied the vote are relegated, by state fiat, in a most basic way
to second-class status."
It is arguable, of course, that the Court never should have applied fundamental
rights doctrine in the fashion outlined above. Justice Harlan, for one, maintained that
strict equal protection scrutiny was appropriate only when racial or analogous
classifications were at issue.100 But it is too late to debate that point, and I believe that
accepting the principle of the voting cases -- the idea that state classifications bearing on
certain interests pose the risk of allocating rights in a fashion inherently contrary to any
notion of equality dictates the outcome here. As both JUSTICE POWELL and THE
CHIEF JUSTICE observe, the Texas scheme inevitably will create a subclass of
illiterate persons,101 where I differ with THE CHIEF JUSTICE is in my conclusion that
102
this makes the statutory scheme unconstitutional, as well as unwise.
In my view, when the State provides an education to some and denies it to others,
it immediately and inevitably creates class distinctions of a type fundamentally
inconsistent with those purposes, mentioned above, of the Equal Protection Clause.
Children denied an education are placed at a permanent and insurmountable competitive
disadvantage, for an uneducated child is denied even the opportunity to achieve. And
99 [I use the term citizen advisedly. The right to vote, of course, is a political interest of concern to
citizens. The right to an education, in contrast, is a social benefit of relevance to a substantial number of
those affected by Texas' statutory scheme, as is discussed below.]
100 Shapiro v. Thompson, 394 U.S. at (dissenting opinion). See Reynolds v. Sims, 377 U.S. at (Harlan, J.,
dissenting).
101 Inf. p. 241 (POWELL, J., concurring); see infra p. 242, 254 (BURGER, C.J., dissenting).
102 [The Court concludes that the provision at issue must be invalidated "unless it furthers some
substantial goal of the State." Ibid., p. 224. Since the statute fails to survive this level of scrutiny, as the
Court demonstrates, there is no need to determine whether a more probing level of review would be
appropriate.]


191
Without laboring what will undoubtedly seem obvious to many, it simply is not
irrational for a state to conclude that it does not have the same responsibility to provide
benefits for persons whose very presence in the state and this country is illegal as it does
to provide for persons lawfully present. By definition, illegal aliens have no right
whatever to be here, and the state may reasonably, and constitutionally, elect not to
provide them with governmental services at the expense of those who are lawfully in the
state.158 In De Canas v. Bica,xy) we held that a State may protect its fiscal interests and
lawfully resident labor force from the deleterious effects on its economy resulting from
the employment of illegal aliens. And, only recently, this Court made clear that a State
has a legitimate interest in protecting and preserving the quality of its schools and the
right of its own bona fide residents to attend such institutions on a preferential tuition
immigration policy, to protect its economy and ability to provide governmental services from the
deleterious effects of a massive influx of illegal immigrants. De Canas v. Bica, 424 U.S. 351 (1976); p.
228, n. 23. The Court maintains that denying illegal aliens a free public education is an "ineffectual" means
of deterring unlawful immigration, at least when compared to a prohibition against the employment of
illegal aliens. Perhaps that is correct, but it is not dispositive; the Equal Protection Clause does not
mandate that a state choose either the most effective and all-encompassing means of addressing a problem
or none at all. Dandridge v. Wiliams, 397 U.S. 471, 1970). Texas might rationally conclude that more
significant demographic or economic problem[s], p. 228, are engendered by the illegal entry into the
State of entire families of aliens for indefinite periods than by the periodic sojourns of single adults who
intend to leave the State after short-term or seasonal employment. It blinks reality to maintain that the
availability of governmental services such as education plays no role in an alien family's decision to enter,
or remain in, this country; certainly, the availability of a free bilingual public education might well
influence an alien to bring his children, rather than travel alone for better job opportunities.]
15 [The Court suggests that the State's classification is improper because [a]n illegal entrant might be
granted federal permission to continue to reside in this country, or even to become a citizen. p. 226.
However, once an illegal alien is given federal permission to remain, he is no longer subject to exclusion
from the tuition-free public schools under 21.031. The Court acknowledges that the Tyler Independent
School District provides a free public education to any alien who has obtained, or is in the process of
obtaining, documentation from the United States Immigration and Naturalization Service, p. 206, n. 2.
Thus, Texas has not taken it upon itself to determine which aliens are or are not entitled to United States
residence. JUSTICE BLACKMUN's assertion that the Texas statute will be applied to aliens who may
well be entitled to ... remain in the United States, p. 236 (concurring opinion), is wholly without
foundation.]
159
424 U.S. 351,357(1976).


105
The Serrano v. Priest19 case illustrated district disparities. John Serranos two
children lived in and attended school in a poor Mexican-American community in Los
Angeles. He wanted quality education for his children and felt that they were denied
equal protection because of their lack of wealth. The California Supreme Court agreed
with the plaintiffs contention in the Serrano case.
We have determined that this funding scheme invidiously
discriminates against the poor because it makes the quality of a
childs education a function of the wealth of his parents and
neighbors.20
In 1954, the Supreme Courts landmark decision in Brown v. Board of
Education21 set equality of educational opportunity.
Today, education is perhaps the most important function of state
and local governments. Compulsory school attendance laws and
great expenditures for education both demonstrate our recognition
of the importance of education to our democratic society .... In
these days, it is doubtful that any child may reasonably be expected
to succeed in life if he is denied the opportunity of an education.
Such an opportunity, where the state has undertaken to provide it,
is a right which must be made available to all on equal terms.22
Education finance theorists claimed that this passage basically meant that where
the government had undertaken to provide education, it did so on an equal basis for all
the residents of a given state. Brown v. Board of Education marked the modem era of
education finance theorists using the courts as the vehicle to shape education finance
19 Serrano v. Priest. California Supreme Court, 1971.
20 Ibid.
21 Brown V. Board of Education. 347 U.S. 483, 74 S. Ct.686, (1954).
22 Ibid., pp. 492-293.
23 James W. Guthrie, School Finance Policies and Practices the 1980s: A Decade of Conflict, (1988).


104
pay their way by contributing in taxes an amount sufficient to meet their additional
educational costs? These basic issues were debated at national and local levels, but such
discussion was not always enlightened to the extent possible by knowledge of how much
immigrant education actually costs or of the values that are at stake; nor were the issues
always stated clearly.15
The Emergency Immigrant Education Program16 and the META agreement17
covered the required needs and responsibilities for serving all immigrant children. Also
considered were the immigrant parents, and immigrant public interest groups' advice,
thoughts and opinions. The most helpful, cost efficient, and productive initiatives
needed to be implemented and, in some cases, developed to serve the undocumented
immigrant in their adopted society.
The equal protection question emerged because of the variation in local school
districts educational expenditures. The level of school expenditure in a district was
mainly determined by the wealth of the local tax base, i.e. taxation of real property. In
some districts, property included large estates and broad industrial holdings that
generated large amounts of tax revenue. In contrast, districts without industries or high-
income property did not have a strong tax base, which limited the amount of money
available for education.18
15 David W. Stewart, (1993), Immigration and Education: The Crisis and the Opportunities, Lexington
Books, New York.
16 The Emergency Immigrant Education Act (EIEA), Title IV, part D of the Elementary and Secondary
Education Act, as amended, (20 U.S.C. 3121-3130).
17 League of United Latin American Citizens (LULAC) et al. v. the State Board of Education et al. Consent
Decree, U.S. District Court for the Southern District of Florida, August 14, 1990.
18
Ibid.


40
remaining true to its culture and by assimilating non-Europeans very slowly.46 The
justifications of cultural unity, which had so concerned Congress, never dominated
immigration debates after 1952.
The 1965 Immigration Act
Congress passed the 1964 Civil Rights Act47 and the 1965 Voting Rights Act48
that forbid discrimination against individuals and students who were limited in English
language proficiency. Congress then passed the 1965 Immigration Act49, which
abolished the national origins formula. Each country outside of the Western Hemisphere
received unlimited visas for relatives of citizens and 20,000 visas for ordinary
immigrants.50 The 1965 Immigration Act also set quotas on immigration from the
nations of the Western Hemisphere for the first time.51 The 1965 Act offered a new
system for immigrants not related to United States citizens to emigrate.52
Senator Edward Kennedy maintained that the new immigration laws would not
lead to a flood of non-European immigration nor upset the ethnic mix of the United
States.53 Attorney General Nicholas Katzenbach reassured doubters by stating, with
46 Ibid.
47 Civil Rights Act of 1964, Pub. L. No. 88-352, 78 Stat. 241.
48 Voting Rights of 1965, Pub. L. no. 89-110, 79 Stat. 437.
49 Immigration Act of 1965, Pub. L. No. 89-235, 79 Stat. 911.
50 Bill Ong Hing, Making And Remaking Asian America Through Immigration Policy, 1850-1990. 38-41
(1993).
51 Immigration Act of 1965, Pub. L. No. 89-235, 79 Stat. 911
52 Ibid.
53 Nathan Glazer, ed., Clamor At The Gates: The New American Immigration, CICS Press, pp. 6-7, (1985).


19
The immigrant population was similar to the United States population in that it
included people with varying degrees of education. Some had less than eight years of
formal education and others had doctorates. The educational level of immigrants was
higher than those of the past and continued to improve. On average, the proportion of
immigrants with post-graduate degrees was greater than the proportion of people with
post-graduate degrees in the native population. 68
Just as the privileges of our society afforded to its educated people served as
incentives for people to become educated, it also served as an incentive for some to
emigrate here, even those who were from countries as prosperous. As a consequence of
this phenomenon, the United States experienced a growth in our pool of people who
excelled in such technological fields as engineering, mathematics and science.69 With
this growth, the United States had the potential of increasing its productivity and
expanding into frontiers in many fields of study, particularly in technology and science.70
A study of immigrant middle school students,71 made available by Johns Hopkins
University, reported that the children of immigrants overwhelmingly preferred English to
their parents' native languages. The initial study was done in 1990 and 1991.72
68 Julian Simon, Immigration: The Demographics and Economic Facts. Washington, DC: Cato Institute
and National Immigration Forum, 1995.
69 David W. Stewart, Immigration and Education: The Crisis and the Opportunities. New York, Lexington
Books, 1993.
70 Carmona, .
71 James M. McPartland, Project Director. Center for Research on the Education of Disadvantaged Students
(CDS), Project # 7126: The Adaptation of Immigrant Children in the American Educational System. John
Hopkins University (1997).
72 Ruben G Rumbaut, (August 1990). Immigrant Students in California Public Schools: A Summary of
Current Knowledge. CDS Report No. 11, and Alejandro Protes (1991), Characteristics and Performance of
High School Students in Dade County (Miami) Schools. CDS Report No. 24.