Between 2018 and 2020, Lake Ridge School Corporation (“Lake Ridge”), School City of Hammond (“Hammond”), and West Lafayette Community School Corporation (“West Lafayette”) (collectively, “the School Corporations”), each closed public-school buildings. Under Indiana Code sections 20-26-7-1 and 20-26-7.1-4, the School Corporations were required to sell or lease those properties no longer in use to any interested charter schools or state educational institutions (i.e., public colleges or universities) for $1. The School Corporations sued the governor in his official capacity, the attorney general in his official capacity, the Indiana State Board of Education, and the Indiana Department of Education (collectively “the State”), arguing these statutes violate the takings clauses of the state and federal constitutions. The State moved for summary judgment, which the trial court granted, and the School Corporations now appeal. Because we agree with the State that the School Corporations, as political subdivisions, cannot assert takings claims against the State, we affirm. [Footnote omitted.]
The State argues the School Corporations, as political subdivisions, cannot sue the State under the takings clauses because “the U.S. Supreme Court has long held that the Takings Clause has no role to play in intragovernmental disputes between a State and one of its agencies or political subdivisions.” Appellee’s Br. p. 19. We agree.
The United States Supreme Court addressed the relationship between states and municipalities in Hunter v. City of Pittsburgh, 207 U.S. 161, 178-79 (1907), stating:
Municipal corporations are political subdivisions of the state, created as convenient agencies for exercising such of the governmental powers of the state as may be intrusted to them. For the purpose of executing these powers properly and efficiently they usually are given the power to acquire, hold, and manage personal and real property. The number, nature, and duration of the powers conferred upon these corporations and the territory over which they shall be exercised rests in the absolute discretion of the state . . . . The state, therefore, at its pleasure, may modify or withdraw all such powers, may take without compensation such property, hold it itself, or vest it in other agencies, expand or contract the territorial area, unite the whole or a part of it with another municipality, repeal the charter and destroy the corporation.
(Emphasis added). Given this relationship, courts generally hold municipalities and political subdivisions cannot bring constitutional claims against their states…
Indisputably, the School Corporations here are political subdivisions of the State. See Parker v. Franklin Cnty. Cmty. Sch. Corp., 667 F.3d 910, 926 (7th Cir. 2012) (“School corporations are political subdivisions . . . .”); see also I.C. § 5- 10.1-1-7 (definition of “political subdivision” includes public-school corporation). We conclude the School Corporations may not assert takings claims against the State. [Footnote omitted.]
Crone, J., and Tavitas, J., concur