{ "id": 12168811, "name": "THOMAS JEFFERSON CLASSICAL ACADEMY CHARTER SCHOOL, PIEDMONT COMMUNITY CHARTER SCHOOL AND LINCOLN CHARTER SCHOOL, Plaintiffs v. CLEVELAND COUNTY BOARD OF EDUCATION, D/B/A CLEVELAND COUNTY SCHOOLS, Defendant", "name_abbreviation": "Thomas Jefferson Classical Academy Charter School v. Cleveland County Board of Education", "decision_date": "2014-06-03", "docket_number": "No. COA13-893", "first_page": "318", "last_page": "327", "citations": [ { "type": "official", "cite": "234 N.C. App. 318" } ], "court": { "name_abbreviation": "N.C. Ct. App.", "id": 14983, "name": "North Carolina Court of Appeals" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "673 S.E.2d 667", "category": "reporters:state_regional", "reporter": "S.E.2d", "case_ids": [ 12642960 ], "pin_cites": [ { "page": "676" } ], "opinion_index": 0, "case_paths": [ "/se2d/673/0667-01" ] }, { "cite": "667 S.E.2d 460", "category": "reporters:state_regional", "reporter": "S.E.2d", "case_ids": [ 12642088, 12642089 ], "year": 2008, "opinion_index": 0, "case_paths": [ "/se2d/667/0460-01", "/se2d/667/0460-02" ] }, { "cite": "655 S.E.2d 850", "category": "reporters:state_regional", "reporter": "S.E.2d", "case_ids": [ 12640270 ], "weight": 3, "pin_cites": [ { "page": "854" }, { "page": "855" }, { "page": "855" } ], "opinion_index": 0, "case_paths": [ "/se2d/655/0850-01" ] }, { "cite": "690 S.E.2d 755", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2010, "pin_cites": [ { "page": "764", "parenthetical": "noting the distinction between a state agent and a state agency" } ], "opinion_index": 0 }, { "cite": "203 N.C. App. 260", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 4175840 ], "year": 2010, "pin_cites": [ { "page": "272", "parenthetical": "noting the distinction between a state agent and a state agency" } ], "opinion_index": 0, "case_paths": [ "/nc-app/203/0260-01" ] }, { "cite": "489 S.E.2d 880", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1997, "pin_cites": [ { "page": "885" }, { "page": "885", "parenthetical": "citation and quotation marks omitted" } ], "opinion_index": 0 }, { "cite": "347 N.C. 97", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 551301 ], "weight": 2, "year": 1997, "pin_cites": [ { "page": "107" }, { "page": "106" } ], "opinion_index": 0, "case_paths": [ "/nc/347/0097-01" ] }, { "cite": "291 S.E.2d 150", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1982, "opinion_index": 0 }, { "cite": "305 N.C. 300", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8568293, 8568358, 8568327, 8568267, 8568222 ], "year": 1982, "opinion_index": 0, "case_paths": [ "/nc/305/0300-03", "/nc/305/0300-05", "/nc/305/0300-04", "/nc/305/0300-02", "/nc/305/0300-01" ] }, { "cite": "285 S.E.2d 110", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1981, "pin_cites": [ { "page": "114" } ], "opinion_index": 0 }, { "cite": "55 N.C. App. 134", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8526873 ], "year": 1981, "pin_cites": [ { "page": "140" } ], "opinion_index": 0, "case_paths": [ "/nc-app/55/0134-01" ] }, { "cite": "731 S.E.2d 428", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2012, "opinion_index": 0 }, { "cite": "731 S.E.2d 427", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2012, "opinion_index": 0 }, { "cite": "366 N.C. 238", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4346784, 4353857, 4353381, 4348360, 4347452, 4354800, 4356016, 4349269, 4345724, 4354654 ], "weight": 2, "year": 2012, "opinion_index": 0, "case_paths": [ "/nc/366/0238-03", "/nc/366/0238-06", "/nc/366/0238-09", "/nc/366/0238-04", "/nc/366/0238-05", "/nc/366/0238-02", "/nc/366/0238-10", "/nc/366/0238-01", "/nc/366/0238-07", "/nc/366/0238-08" ] }, { "cite": "723 S.E.2d 802", "category": "reporters:state_regional", "reporter": "S.E.2d", "pin_cites": [ { "page": "803" } ], "opinion_index": 0 }, { "cite": "749 S.E.2d 851", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2013, "opinion_index": 0 }, { "cite": "746 S.E.2d 324", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 2013, "pin_cites": [ { "page": "326" }, { "page": "326" } ], "opinion_index": 0 }, { "cite": "715 S.E.2d 296", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2011, "pin_cites": [ { "page": "298", "parenthetical": "remanding for the fact finder to apply the correct legal standard" } ], "opinion_index": 0 }, { "cite": "215 N.C. App. 395", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 4343267 ], "year": 2011, "pin_cites": [ { "page": "396", "parenthetical": "remanding for the fact finder to apply the correct legal standard" } ], "opinion_index": 0, "case_paths": [ "/nc-app/215/0395-01" ] }, { "cite": "727 S.E.2d 675", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 4, "year": 2012, "pin_cites": [ { "page": "681", "parenthetical": "citation and quotation marks omitted" }, { "page": "682" }, { "page": "683", "parenthetical": "concluding that an amendment was a clarifying one \"[b]ecause the legislature left essentially all our pre-amendment cases intact\"" }, { "page": "681" } ], "opinion_index": 0 }, { "cite": "366 N.C. 1", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4353050 ], "weight": 2, "year": 2012, "pin_cites": [ { "page": "8-9", "parenthetical": "citation and quotation marks omitted" }, { "page": "10" } ], "opinion_index": 0, "case_paths": [ "/nc/366/0001-01" ] }, { "cite": "749 S.E.2d 278", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2013, "opinion_index": 0 }, { "cite": "720 S.E.2d 745", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 2011, "pin_cites": [ { "page": "750", "parenthetical": "citation and quotation marks omitted" }, { "page": "750", "parenthetical": "holding that the Industrial Commission has no discretion in determining an interest award when the relevant statute employed the word \"shall\"" } ], "opinion_index": 0 }, { "cite": "724 S.E.2d 531", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 2012, "opinion_index": 0 }, { "cite": "715 S.E.2d 625", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 8, "year": 2011, "pin_cites": [ { "page": "633", "parenthetical": "Thomas Jefferson I" }, { "page": "630", "parenthetical": "\"[I]f funds are placed in the 'local current expense fund' and not held in a 'special fund,' they must be considered as being part of the 'local current expense fund' used to determine the pro rata share due to the charter schools.\"" }, { "page": "634", "parenthetical": "\"Sugar Creek I and II clearly indicate that it is incumbent upon the local administrative unit to place restricted funds into a separate fund.\"" }, { "page": "634" }, { "page": "630" }, { "page": "630" } ], "opinion_index": 0 }, { "cite": "215 N.C. App. 530", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 4343180 ], "weight": 4, "year": 2011, "pin_cites": [ { "page": "543", "parenthetical": "Thomas Jefferson I" }, { "page": "544" }, { "page": "537" }, { "page": "537" } ], "opinion_index": 0, "case_paths": [ "/nc-app/215/0530-01" ] }, { "cite": "687 S.E.2d 296", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2009, "opinion_index": 0 }, { "cite": "363 N.C. 663", "category": "reporters:state", "reporter": "N.C.", "year": 2009, "opinion_index": 0 }, { "cite": "195 N.C. App. 348", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 4164838 ], "pin_cites": [ { "page": "360-61" } ], "opinion_index": 0, "case_paths": [ "/nc-app/195/0348-01" ] }, { "cite": "188 N.C. App. 454", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 4155478 ], "weight": 3, "pin_cites": [ { "page": "460" }, { "page": "460-61" }, { "page": "460" } ], "opinion_index": 0, "case_paths": [ "/nc-app/188/0454-01" ] }, { "cite": "577 S.E.2d 117", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2003, "opinion_index": 0 }, { "cite": "356 N.C. 670", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 1511626, 1511405, 1511218, 1511607, 1511609 ], "year": 2003, "opinion_index": 0, "case_paths": [ "/nc/356/0670-04", "/nc/356/0670-02", "/nc/356/0670-05", "/nc/356/0670-03", "/nc/356/0670-01" ] }, { "cite": "563 S.E.2d 92", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2002, "pin_cites": [ { "page": "98" } ], "opinion_index": 0 }, { "cite": "150 N.C. App. 338", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 9081062 ], "year": 2002, "pin_cites": [ { "page": "347" } ], "opinion_index": 0, "case_paths": [ "/nc-app/150/0338-01" ] }, { "cite": "681 S.E.2d 813", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2009, "pin_cites": [ { "page": "817", "parenthetical": "citations, quotation marks, and brackets omitted" } ], "opinion_index": 0 }, { "cite": "199 N.C. App. 531", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 4170045 ], "year": 2009, "pin_cites": [ { "page": "537", "parenthetical": "citations, quotation marks, and brackets omitted" } ], "opinion_index": 0, "case_paths": [ "/nc-app/199/0531-01" ] }, { "cite": "N.C. Gen. Stat. \u00a7 6-19.1", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "weight": 7, "pin_cites": [ { "page": "(a)" } ], "opinion_index": 0 } ], "analysis": { "cardinality": 854, "char_count": 22746, "ocr_confidence": 0.722, "pagerank": { "raw": 4.03580807328026e-08, "percentile": 0.24686188268119105 }, "sha256": "6ac4952b1ad647c8fd5dda7bee7fde063af99891c01ac7387a96e03545845938", "simhash": "1:893d116a487ee46c", "word_count": 3707 }, "last_updated": "2023-07-14T22:30:06.319137+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges HUNTER, JR., Robert N. and Judge DILLON concur." ], "parties": [ "THOMAS JEFFERSON CLASSICAL ACADEMY CHARTER SCHOOL, PIEDMONT COMMUNITY CHARTER SCHOOL AND LINCOLN CHARTER SCHOOL, Plaintiffs v. CLEVELAND COUNTY BOARD OF EDUCATION, D/B/A CLEVELAND COUNTY SCHOOLS, Defendant" ], "opinions": [ { "text": "STROUD, Judge.\nThe Cleveland County Board of Education, d/b/a Cleveland County Schools (\u201cCCS\u201d or \u201cdefendant\u201d), appeals from the judgment entered by the trial court on or about 13 February 2013, wherein it concluded that certain funds that CCS had placed in Fund 8 should have been placed into the local current expense fund and distributed on a pro rata basis to the plaintiff charter schools. CCS also appeals from an order awarding plaintiffs attorneys\u2019 fees. We remand to allow the trial court to apply the correct legal standard. We reverse the trial court\u2019s order awarding attorneys\u2019 fees.\nI. Background\nOn 9 January 2012, Thomas Jefferson Classical Academy Charter School, Piedmont Community Charter School, and Lincoln Charter School (\u201cplaintiffs\u201d) filed a complaint in superior court, Cleveland County, alleging that CCS had failed to pay them the proper per-pupil amount required by statute. Plaintiffs specifically contended that CCS wrongfully moved approximately $4.9 million from the local current expense fund, which must be shared with the charter schools, to a \u201cspecial revenue fund,\u201d which is not shared. Plaintiffs alleged that they were owed approximately $102,480. Plaintiffs sought a declaratory judgment that CCS must allocate the funds as plaintiffs contended the statute required, recovery in the amount of $102,480, and attorneys\u2019 fees under N.C. Gen. Stat. \u00a7 6-19.1. CCS answered, denying that their transfer of the funds to the special revenue fund violated any of the applicable statutes and that plaintiffs were owed anything.\nThe case was tried by the superior court sitting without a jury. The parties each presented evidence to support their claims. Plaintiffs primarily relied on the testimony of David Lee, financial director for CCS. Mr. Lee prepared an audit report of CCS\u2019 finances, which used various state budget codes for different revenue sources. Many of the funding sources that CCS had placed in the special revenue fund were classified by Mr. Lee as \u201cunrestricted.\u201d Defendant presented a number of witnesses who administered various programs within the CCS system who testified about their funding sources and the use of those funds. After two days of testimony, the trial court took the matter under advisement.\nThe trial court entered its judgment on 21 February 2013, wherein it found that defendant had misappropriated approximately $2,781,281 that should have been placed in the current expense fund rather than the special revenue fund. It found that Mr. Lee had admitted that $2,109,377 of the funds, called \u201cColumn A,\u201d were \u201cunrestricted.\u201d It further found, based on Mr. Lee\u2019s testimony and that of the other CCS administrators, that $671,904 of the funds, listed under \u201cColumn B\u201d and \u201cColumn C\u201d were \u201c(a) part of \u2018moneys made available to CCS for its \u2018current operating expenses, (b) used by CCS to operate its general K-12 programs and activities, and (c) not restricted to purposes outside CCS\u2019s general educational programs.\u201d It concluded that defendant owed plaintiffs $57,836 collectively and entered judgment against CCS in that amount. Defendant filed written notice of appeal from the 21 February 2013 judgment on 18 March 2013.\nPlaintiffs then filed a petition for attorneys\u2019 fees under N.C. Gen. Stat. \u00a7 6-19.1(a). The trial court, by order and judgment entered 2 April 2013, granted plaintiffs\u2019 petition and awarded them $47,195.90 in attorneys\u2019 fees. Defendant filed written notice of appeal from the 2 April 2013 judgment and order on 30 April 2013.\nII. \u201cRestricted\u201d Funds\nDefendant argues that the trial court erred in finding that various revenue sources were not \u201crestricted\u201d and concluding that these funds were therefore subject to a per-pupil distribution to the plaintiff charter schools. Recently the Legislature has amended the statute the Judge applied below clarifying the definition of \u201crestricted\u201d funds, so we remand for the trial court to apply this definition to the facts here.\nA. Standard of Review\nWhen the trial court sits without a jury, the standard of review on appeal is whether there was competent evidence to support the trial court\u2019s findings of fact and whether its conclusions of law were proper in light of such facts.... Evidence must support the findings, the findings must support the conclusions of law, and the conclusions of law must support the ensuing judgment.\nJackson v. Culbreth, 199 N.C. App. 531, 537, 681 S.E.2d 813, 817 (2009) (citations, quotation marks, and brackets omitted).\nB. Charter School Funding and the Uniform Budget Statute\nThe allocation of funds between local school administrative units and charter schools is governed by N.C. Gen. Stat. \u00a7 115C-238.29H (2009). That statute requires the local school administrative unit to \u201ctransfer to the charter school an amount equal to the per pupil local current expense appropriation to the local school administrative unit for the fiscal year.\u201d N.C. Gen. Stat. \u00a7 115C-238.29H(b). This Court has interpreted the phrase \u201clocal current expense appropriation\u201d to be \u201csynonymous with the phrase \u2018local current expense fund\u2019 in the School Budget and Fiscal Control Act, N.C.G.S. \u00a7 115C-426(e).\u201d Francine Delany New School for Children, Inc. v. Asheville City Bd. of Educ., 150 N.C. App. 338, 347, 563 S.E.2d 92, 98 (2002), disc. rev. denied, 356 N.C. 670, 577 S.E.2d 117 (2003). We have further held that charter schools \u201care entitled to an amount equal to the per pupil amount of all money contained in the local current expense fund.\u201d Sugar Creek Charter School, Inc. v. Charlotte-Mecklenburg Bd. of Educ., 188 N.C. App. 454, 460, 655 S.E.2d 850, 854 (Sugar Creek I), disc. rev. denied, _ N.C. _, 667 S.E.2d 460 (2008). It is immaterial that the school board has earmarked particular funds for a specific purpose if the funds have been deposited in the local current expense fund. Sugar Creek Charter School, Inc. v. Charlotte-Mecklenburg Bd. of Educ., 195 N.C. App. 348, 360-61, 673 S.E.2d 667, 676 (Sugar Creek II) (holding, inter alia, that the trial court did not err in concluding that funds designated for students affected by Hurricane Katrina were subject to per-pupil distribution to charter schools because they were placed in the current local expense fund, as opposed to a separate fund), disc. rev. denied, 363 N.C. 663, 687 S.E.2d 296 (2009).\nThe local current expense fund is defined by N.C. Gen. Stat. \u00a7 116C426(e) (2009):\nThe local current expense fund shall include appropriations sufficient, when added to appropriations from the State Public School Fund, for the current operating expense of the public school system in conformity with the educational goals and policies of the State and the local board of education, within the financial resources and consistent with the fiscal policies of the board of county commissioners. These appropriations shall be funded by revenues accruing to the local school administrative unit by virtue of Article IX, Sec. 7 of the Constitution, moneys made available to the local school administrative unit by the board of county commissioners, supplemental taxes levied by or on behalf of the local school administrative unit pursuant to a local act or G.S. 115C-501 to 115C-511, State money disbursed directly to the local school administrative unit, and other moneys made available or accruing to the local school administrative unit for the current operating expenses of the public school system.\nN.C. Gen. Stat. \u00a7 115C-426(c) also permits the creation of \u201cother funds ... to account for trust funds, federal grants restricted as to use, and special programs.\u201d Thus, we have held that \u201cthe provisions of Chapter 115C ... do not require that all monies provided to the local administrative unit be placed into the \u2018local current.expense fund\u2019 (Fund Two).\u201d Thomas Jefferson Classical Academy v. Rutherford County Bd. of Educ., 215 N.C. App. 530, 543, 715 S.E.2d 625, 633 (2011) (Thomas Jefferson I), disc. rev. denied and app. dismissed, _ N.C. _, 724 S.E.2d 531 (2012). \u201cRestricted funds\u201d kept in a fund separate from the local current expense fund are exempt from per-pupil distribution to the charter schools. Id. at _, 715 S.E.2d at 630 (\u201c[I]f funds are placed in the \u2018local current expense fund\u2019 and not held in a \u2018special fund,\u2019 they must be considered as being part of the \u2018local current expense fund\u2019 used to determine the pro rata share due to the charter schools.\u201d). The local school board has the authority to place such restricted funds in a separate fund. Id. at _, 715 S.E.2d at 634 (\u201cSugar Creek I and II clearly indicate that it is incumbent upon the local administrative unit to place restricted funds into a separate fund.\u201d); Sugar Creek I, 188 N.C. App. at 460-61, 655 S.E.2d at 855. However, we have never defined what \u201crestricted funds\u201d are or who has the authority to make that determination.\nThus, there are two fundamental questions we must address here: (1) does the local school board have discretionary authority to allocate funds into the local current expense fund or a separate fund as it sees fit?; and if not, (2) did defendant here properly classify the funds at issue as restricted?\nN.C. Gen. Stat. \u00a7 115C-426(e) states that the local current expense fund\nshall be funded by revenues accruing to the local school administrative unit by virtue of Article IX, Sec. 7 of the Constitution, moneys made available to the local school administrative unit by the board of county commissioners, supplemental taxes levied by or on behalf of the local school administrative unit pursuant to a local act or G.S. 115C-501' to 115C-511, State money disbursed directly to the local school administrative unit, and other moneys made available or accruing to the local school administrative unit for the current operating expenses of the public school system.\n\u201cIt is well established that the word \u2018shall\u2019 is generally imperative or mandatory.\u201d Chandler ex rel. Harris v. Atlantic Scrap & Processing, _ N.C. App. _, _, 720 S.E.2d 745, 750 (2011) (citation and quotation marks omitted), aff\u2019d and remanded, _ N.C. _, 749 S.E.2d 278 (2013). Consistent with this Court\u2019s decisions in Sugar Creek I, Sugar Creek II, and Thomas Jefferson I, as well as the plain language of N.C. Gen. Stat. \u00a7 115C-426(e), we conclude that the local school administrative unit may deposit any \u201crestricted\u201d funds into a fund separate from the current expense fund. See Thomas Jefferson I, 215 N.C. App. at 544, 715 S.E.2d at 634; Sugar Creek I, 188 N.C. App. at 460, 655 S.E.2d at 855. By contrast, any funds covered by N.C. Gen. Stat. \u00a7 115C-426(e) must be deposited into the local current expense fund. We further conclude that the determination of which funds may be placed in a separate fund is not solely in the discretion of the local school board, given the mandatory language found in the budget statute. See Chandler, _ N.C. App. at _, 720 S.E.2d at 750 (holding that the Industrial Commission has no discretion in determining an interest award when the relevant statute employed the word \u201cshall\u201d).\nC. Defining \u201crestricted\u201d funds\n\u201cRestricted\u201d is not a term found in any of the relevant statutes. Rather, it is a gloss this Court has put on the statutory definitions found in N.C. Gen. Stat. \u00a7 115C-426(c). It was the Court\u2019s shorthand for those monies that can be placed in a separate fund, i.e. those from \u201ctrust funds, federal grants restricted as to use, and special programs\u201d which must be accounted for separately. N.C. Gen. Stat. \u00a7 115C-426(c).\nThe guidance from the Department of Public Instruction that we reviewed in Thomas Jefferson I indicated that Fund 8 was a new, separate fund \u201cto separately maintain funds that are restricted in purpose and not intended for the general K-12 population in the LEA.\u201d Thomas Jefferson I, 215 N.C. App. at 537, 715 S.E.2d at 630. Such funds included:\n(a) State funds that are provided for a targeted non-K-12 constituency such as More-at-Four funds;\n(b) Funds targeted for a specific, limited purpose, such as a trust fund for a specific school within the LEA;\n(c) Federal or other funds not intended for the general K-12 instructional population, or a sub-group within that population, such as funds for a pilot program;\n(d) Indirect cost, such as those associated with a federal grant that represent reimbursement for cost previously incurred by the LEA.\nId.\nAfter the extensive litigation over the definition of \u201crestricted\u201d and \u201cunrestricted\u201d funds, the Legislature passed an amendment to N.C. Gen. Stat. \u00a7 115C-426 in 2010 and again in 2013. N.C. Sess. Laws 2010-31, \u00a7 7.17(a); N.C. Sess. Laws 2013-355, \u00a7 2(a). The statute now clarifies that:\nother funds may be used to account for reimbursements, including indirect costs, fees for actual costs, tuition, sales tax revenues distributed using the ad valorem method pursuant to G.S. 105-472(b)(2), sales tax refunds, gifts and grants restricted as to use, trust funds, federal appropriations made directly to local school administrative units, and funds received for prekindergarten programs. In addition, the appropriation or use of fund balance or interest income by a local school administrative unit shall not be construed as a local current expense appropriation included as a part of the local current expense fund.\nN.C. Gen. Stat. \u00a7 115C-426 (c) (2013).\nIn construing a statute with reference to an amendment it is presumed that the legislature intended either (a) to change the substance of the original act, or (b) to clarify the meaning of it. A clarifying amendment, unlike an altering amendment, is one that does not change the substance of the law but instead gives further insight into the way in which the legislature intended the law to apply from its original enactment.\nRay v. North Carolina Dept. of Transp., 366 N.C. 1, 8-9, 727 S.E.2d 675, 681 (2012) (citation and quotation marks omitted).\nThe 2010 amendment to \u00a7 115C-426 is fully consistent with the 2009 definition of \u201crestricted\u201d funds used by the Department of Public Instruction that we approved of in Thomas Jefferson I and with this Court\u2019s gloss on that statute. See Thomas Jefferson I, 215 N.C. App. at 537, 715 S.E.2d at 630. In addition to being consistent with the prior case law, the amendment simply provided a more complete description of the funds which may be excluded from the local current expense fund. \u201cTo determine whether the amendment clarifies the prior law or alters it requires a careful comparison of the original and amended statutes. If the statute initially fails expressly to address a particular point but addresses it after the amendment, the amendment is more likely to be clarifying than altering.\u201d Ray, 366 N.C. at 10, 727 S.E.2d at 682. Therefore, we conclude that the 2010 amendments were clarifying amendments rather than substantive changes. See id. at 11, 727 S.E.2d at 683 (concluding that an amendment was a clarifying one \u201c[b]ecause the legislature left essentially all our pre-amendment cases intact\u201d). \u201c[S]uch amendments apply to all cases pending before the courts when the amendment is adopted, regardless of whether the underlying claim arose before or after the effective date of the amendment.\u201d Id. at 9, 727 S.E.2d at 681.\nIt is not clear what definition of \u201crestricted\u201d the trial court applied, but it is clear that the definition used was not that laid out by the 2010 amendments. In some instances it followed the budget code assigned by Mr. Lee, but not in others. It considered some reimbursements \u201crestricted,\u201d but others \u201cunrestricted.\u201d Even some pre-K programs were considered \u201cunrestricted.\u201d\nThe clarifying amendments provide the proper standard with which to determine whether funds are \u201crestricted.\u201d \u201cRestricted\u201d funds, i.e., monies that may be properly placed in a fund separate from the local current expense fund, are those that fall into one of the categories mentioned in N.C. Gen. Stat. \u00a7 115C-426(c) as amended. It is clear that the trial court did not apply this standard. We therefore remand to allow the trial court to make appropriate findings of fact and to determine whether the funds at issues are \u201crestricted\u201d under the correct standard of law. See Powe v. Centerpoint Human Services, 215 N.C. App. 395, 396, 715 S.E.2d 296, 298 (2011) (remanding for the fact finder to apply the correct legal standard).\nOn remand, the trial court should make findings about whether the funds at issue here are \u201creimbursements, including indirect costs, fees for actual costs, tuition, sales tax revenues distributed using the ad valorem method pursuant to G.S. 105-472(b)(2), sales tax refunds, gifts and grants restricted as to use, trust funds, federal appropriations made directly to local school administrative units, [or] funds received for prekindergarten programs.\u201d N.C. Gen. Stat. \u00a7 115C-426(c) (2013). If the funds fall into any of these categories, they may be properly considered \u201crestricted,\u201d placed into a separate fund, and not shared on a pro rata basis with the charter schools. See Thomas Jefferson I, 215 N.C. App. at 544, 715 S.E.2d at 633.\nIII. Attorneys\u2019 Fees\nDefendant next argues that the trial court erred in awarding plaintiff attorneys\u2019 fees under N.C. Gen. Stat. \u00a7 6-19.1 because a local school board is not a state agency. We agree.\nN.C. Gen. Stat. \u00a7 6-19.1 (2011) allows the trial court to award attorney\u2019s fees to a party prevailing over a state agency in a civil action. This Court has held that the definition of \u201cagency\u201d for the purposes of \u00a7 6-19.1 is the same as the definition of an \u201cagency\u201d under the Administrative Procedures Act (APA). Izydore v. City of Durham (Durham Bd. of Adjustment), _ N.C. App. _, _, 746 S.E.2d 324, 326, disc. rev. denied, _ N.C. _, 749 S.E.2d 851 (2013). The APA defines an \u201cagency\u201d as\nan agency or an officer in the executive branch of the government of this State and includes the Council of State, the Governor\u2019s Office, a board, a commission, a department, a division, a council, and any other unit of government in the executive branch. A local unit of government is not an agency.\nN.C. Gen. Stat. \u00a7 150B-2(la) (2011) (emphasis added). Accordingly, we have held that local governmental units, like municipalities and counties, are not subject to the attorney\u2019s fees provisions of N.C. Gen. Stat. \u00a7 6-19.1. Izydore, _ N.C. App. at _, 746 S.E.2d at 326 (holding that \u201clocal governmental units\u2014such as respondents\u2014are not \u2018agencies\u2019 for purposes of \u00a7 6-19.1.\u201d). Local school boards and local school administrative units are local governmental units, and, as such, are not \u201cagencies\u201d for the purpose of the APA. See N.C. Gen. Stat. \u00a7 115C-5(5)-(6) (defining \u201clocal school board\u201d as \u201ca city board of education, county board of education, or a city-county board of education\u201d and a \u201clocal school administrative unit\u201d as \u201ca subdivision of the public school system which is governed by a local board of education. It may be a city school administrative unit, a county school administrative unit, or a city-county school administrative unit.\u201d); Coomer v. Lee County Bd. of Educ., _ N.C. App. _, _, 723 S.E.2d 802, 803 (observing that \u201clocal boards of education are generally excluded from the requirements of the APA\u201d), disc. rev dismissed, 366 N.C. 238, 731 S.E.2d 427, disc. rev. denied, 366 N.C. 238, 731 S.E.2d 428 (2012).\nPlaintiffs contend that the local school boards are subject to \u00a7 6-19.1 because we have held that they \u201care deemed agents of the State for purposes of providing public education.\u201d Kiddie Korner Day Schools, Inc. v. Charlotte-Mecklenburg Bd. of Educ., 55 N.C. App. 134, 140, 285 S.E.2d 110, 114 (1981), app. dismissed and disc. rev. denied, 305 N.C. 300, 291 S.E.2d 150 (1982). Yet, our Supreme Court has noted that \u201c[a]n agent of the State and a state agency are fundamentally different... .\u201d Meyer v. Walls, 347 N.C. 97, 107, 489 S.E.2d 880, 885 (1997); see also Green v. Kearney, 203 N.C. App. 260, 272, 690 S.E.2d 755, 764 (2010) (noting the distinction between a state agent and a state agency). In that same opinion, the Supreme Court quoted a prior opinion for the proposition that \u201c[i]n no sense may we consider the [Local] Board of Education in the same categoiy as the State Board of Education ....\u201d Meyer, 347 N.C. at 106, 489 S.E.2d at 885 (citation and quotation marks omitted). Thus, local school boards are not state agencies for purposes of the APA and N.C. Gen. Stat. \u00a7 6-19.1 simply because they may be considered agents of the State in certain circumstances.\nWe hold that the trial court erred in awarding plaintiff attorney\u2019s fees under N.C. Gen. Stat. \u00a7 6-19.1 because defendant is not an agency for purposes of that statute. Therefore, we reverse the trial court\u2019s order allowing plaintiff\u2019s petition for attorneys\u2019 fees.\nIV. Conclusion\nFor the foregoing reasons, we remand for the trial court to enter a revised judgment with appropriate findings of fact and conclusions of law applying the correct standard as laid out in the 2010 amendments. We reverse the trial court\u2019s order awarding plaintiffs attorney\u2019s fees.\nREVERSED in part; REMANDED.\nJudges HUNTER, JR., Robert N. and Judge DILLON concur.", "type": "majority", "author": "STROUD, Judge." } ], "attorneys": [ "Robinson Bradshaw & Hinson, P.A., by Richard A. Vinroot and Matthew F. Tilley, for plaintiffs-appellees.", "Tharrington Smith, L.L.P., by Deborah R. Stagner, for defendant-appellant.", "Allison B. Schafer and Christine T. Scheef for N.C. School Boards Association, for amicus curiae." ], "corrections": "", "head_matter": "THOMAS JEFFERSON CLASSICAL ACADEMY CHARTER SCHOOL, PIEDMONT COMMUNITY CHARTER SCHOOL AND LINCOLN CHARTER SCHOOL, Plaintiffs v. CLEVELAND COUNTY BOARD OF EDUCATION, D/B/A CLEVELAND COUNTY SCHOOLS, Defendant\nNo. COA13-893\nFiled 3 June 2014\n1. Schools and Education\u2014charter school funding\u2014funding\u2014 restricted funds\nAn order involving the sharing of money between the Cleveland County Schools (CSS) and charter schools was remanded for appropriate findings of fact and a determination of whether the funds at issues were \u201crestricted\u201d under the 2010 clarifying amendment to N.C.G.S. \u00a7 115C-426 (such amendments apply to all cases pending before the courts when the amendment is adopted, regardless of when the underlying claim arose). Money from the local current expense fund is shared with the charter schools, but not money from restricted funds.\n2. Attorney Fees\u2014action against school board\u2014not an agency\nThe trial court erred in an action against a school board by awarding plaintiff attorney fees under N.C.G.S. \u00a7 6-19.1, which allows attorney fees to a party prevailing over a state agency in a civil action. Defendant was not an agency for purposes of that statute.\nAppeal by defendant from Judgment entered on or about 13 February 2013 and Order and Judgment entered 2 April 2013 by Judge Jesse B. Caldwell III, in Superior Court, Cleveland County. Heard in the Court of Appeals 23 January 2014.\nRobinson Bradshaw & Hinson, P.A., by Richard A. Vinroot and Matthew F. Tilley, for plaintiffs-appellees.\nTharrington Smith, L.L.P., by Deborah R. Stagner, for defendant-appellant.\nAllison B. Schafer and Christine T. Scheef for N.C. School Boards Association, for amicus curiae." }, "file_name": "0318-01", "first_page_order": 328, "last_page_order": 337 }