Davenport schools Superintendent Art Tate Monday said he intends to "violate state law" and use more money than the state of Iowa has authorized.
The move will stave off budget cuts that Tate and the board had been discussing for months.
"I am taking this action after careful consideration and understanding the possible personal consequence," Tate said. "I take full and sole responsibility for the violation of state law.
"With this action, I am following the example of our state Legislature, which has ignored the law this year by not providing districts with the state supplemental aid amount by Feb. 12, 2015."
Tate’s address to the board and the audience was greeted with thunderous applause and a standing ovation.
Tate said a legislative forum on Saturday, when he saw some of his students wearing T-shirts that said "I'm Worth-Less,” influenced his decision.
Three students wore those T-shirts to the Monday board meeting and spoke about the inequity of the state funding system for education.
"We won't stand for our schools being underfunded," North High School student Anthony DeSalvo said. "We won't stand for inequality. Our students are not worth less than anyone else."
All three students briefly stood behind Tate during the board meeting.
The forum, Tate said, made him realize his personal responsibility as the district leader to take action. The students' T-shirts, he said, are literally correct.
"Our students are valued less than many others in the state," he said. "This unfair situation."
It evolved from a formula that was put in place in the early 1970s. The process remains, with the value placed on Davenport district students at $175 less than the value for students in other districts that receive the highest per-student rate in Iowa.
The state funding formula explicitly values a Davenport student less than students in more than 170 other districts, including Pleasant Valley and Bettendorf, Tate said.
At the legislative forum, Tate also listened to members of the audience ask why the state Legislature "can ignore the law by not producing a timely two-year education budget."
"Why I should be held to a higher standard when it comes to statutes concerning budgets?" Tate asked Monday night.
The state prohibits districts from spending more than they are authorized to spend, based on the district's certified budget and the increase in allowable growth and state supplemental aid that the state provides.
"In other words, the state restricts how much a district can spend, no matter how much you have in the bank," Tate said.
Now Tate plans for the district to spend more than the state authorized during the school year 2016-2017, which would violate state code.
Tate emphasized that enough money is in the cash reserve.
Tate said the state funding formula, which "undervalues our students by $3.2 million each year," is complicated. What is not complicated, he said, is that "our students and families have unmet needs resulting from a lack of funding." Additionally, the district has cash reserves of $29 million.
"By using our reserves, we can sustain additional funding or programs without increasing the tax levy," he said.
He said he realizes he could lose his job. “But that would be up to the school board, not the state.” Spending more than that the state authorizes is considered to be a misdemeanor, he said.
The Davenport district has nearly 16,000 students with 67.3 percent of them eligible for free and reduced-priced lunches, Tate said.
"The district's board of education and I have been transparent in describing the critical challenges which face our schools and students," Tate said. "By its board priorities, the directors acknowledge the overriding effects of poverty on education in the district."
Earlier, Tate had planned for the district to slash $3.5 million from the general fund budget for the 2015-16 school year and $5 million from the next year's budget.
Several board members spoke in support of Tate.
"I think it's criminal that we're put in this position and that our children are made to wear shirts that say 'I'm Worth-Less,'" said board member Jamie Snyder. "What investment does the state of Iowa think is more important than our children?"
"I applaud you, Dr. Tate," said board member Ken Krumwiede, who also attended the Saturday forum. He said he was disappointed in the legislators who were there. "I hope you're all listening out there ... you need to contact your legislators to get things changed in Des Moines."
Board Vice President Rich Clewell said, to much laughter, that he felt like he had "walked out of a board meeting and into a Baptist revival."
"Although the cost of education might be high, what is the cost of ignorance?" Clewell asked.
Tate said he will make budget cuts with early retirement, utility savings through an energy conservation program, moving maintenance contracts from the general fund to the management fund and curtailing professional development during the school day, amounting to $1.4 million in savings.
"I will be asking no other reductions to programs and personnel, and most notably, I will not be increasing class size in order to reduce teacher positions," he said.
Tate said he intends to use up to $1 million to support new programs to reduce the achievement gap, to "fight the effects of poverty, and to address diversion programs needed to turn around our out-of-school suspension numbers."
"I am exceptionally proud of Dr. Tate and our district and our board and our community," board President Ralph Johanson said, adding that he hopes the bold move will help the state "to get back on track."