Kansas is short changing its students by cutting funding for education and must increase spending by about $400 million, a three-judge panel ruled unanimously on Friday.
The court said it was "illogical" for the state to argue that it could not adequately fund schools at the same time it slashed income taxes.
The ruling is the latest in a series of court victories for a group of public school districts, parents and students in Kansas who have demanded for years that the state provide more money for schools.
Kansas is one of a number of states with Republican majority legislatures and governors which have either cut taxes or are proposing to do so, arguing that it would encourage business and stimulate the economy. Critics fear it could devastate social services and education.
A funding plan was devised for Kansas in 2006 through a settlement of a prior lawsuit but the groups filed suit again in 2010 when the state made an estimated $300 million in funding cuts. The state made even more cuts in 2011. There have been $511 million in cuts to the base funding between fiscal year 2009 and fiscal 2012.
"This is just a wonderful victory for these school kids in Kansas," said lawyer John Robb, whose firm represents the plaintiffs in the case, which was filed in Shawnee County District Court in Topeka.
"The (state) constitution says they have rights to an adequately funded education," Robb said. "And the courts have said yes ... it means what it says."
In the ruling, the court said that while the state argued finances were tight and increasing education spending could have "disastrous consequences to the Kansas economy," it intentionally reduced revenues by cutting the state income tax.
Increased education spending was deemed disastrous while the state income tax reduction was estimated to reduce revenue for 2013 by $800 million to $1 billion, the court said.
"It seems completely illogical that the state can argue that a reduction in education funding was necessitated by the downturn in the economy and the state's diminishing resources and at the same time cut taxes further," the court said.
Gov. Sam Brownback, a Republican who has advocated for the tax cuts, said he ruling was "disappointing but not unexpected."
He said school funding should be up to lawmakers, not courts.
"Through today's ruling, the courts are drastically increasing the property tax burden on every Kansan," Brownback said in a statement. "The legislative process is the appropriate venue for debating and resolving issues of taxation and spending."
But Democrats have criticized Brownback for presiding over roughly $500 million in cuts to public education, which Brownback authorized in 2011.
Brownback spokeswoman Sherriene Jones-Sontag said the Governor would have no comment until he finished reviewing the 257-page decision.
The ruling means that the state must provide at least $4,492 per pupil for the roughly 600,000 students, up from $3,838 per student.
Dave Trabert, president of the conservative public policy advocacy group Kansas Policy Institute, criticized the ruling, saying the increase ordered in funding will force a tax hike.
"It costs a lot of money to operate our schools, but it's how the money is spent that matters, not simply how much," Trabert said.
This week, the publication Education Week gave the state of Kansas a "C" grade for its education system, funding and achievement.
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