CHICAGO - An Indiana school funding lawsuit has been out on hold following Gov. Evan Bayh's promise that school financing inequities will be addressed in the next legislative session.

The suit, which was scheduled to go to trial in September, charges that the state's school funding formula is unconstitutional because it results in differences in per pupil spending, according to Marilyn Holscher, an attorney for the plaintiffs.

Currently, annual per pupil spending in the state's 296 school districts ranges from $2,673 to $5,412, Ms. Holscher said.

The suit was filed by 52 school districts in 1987, but 12 districts have dropped out of the suit, primarily because of legal costs, she added.

In exchange for the plaintiffs' agreement to stop further legal action, Gov. Bayh will push for legislation to equalize the school funding formula, according to David Dawson, the governor's spokesman.

If the plaintiffs are not satisfied with legislation drafted in the 1993 biennial session, which begins in January, they can continue their legal action against the state, he said.

If the lawsuit proceeds and is successful, it could cost the state "hundreds of millions of dollars a year," Mr. Dawson added.

The agreement with the plaintiffs was reached after the governor met with about 20 school superintendents last week at their request. During the meeting, both sides expressed interest in resolving the suit to avoid costly legal proceedings, Mr. Dawson said.

"I am delighted that we have reached an agreement to attempt to resolve this case in the appropriate forum - the General Assembly. I have maintained throughout this lawsuit that the elected representatives of the citizens of the state of Indiana are the proper parties of address this issue," Gov. Bayh said in a press release.

The governor noted in the release that since 1986, the state has increased funding for education, despite a recession that "severely" affected state revenues.

Indiana Attorney General Linley Pearson, Gov. Bayh's Republican opponent in this November's election, declined to comment on the issue because of a conflict of interest, according to Jim Poinsett, his campaign spokesman.

As attorney general, Mr. Pearson would be obligated to defend the state in the case, the spokesman said.

Ms. Holscher said the school districts involved in the suit are "cautiously optimistic" about the pact and believe in the governor's commitment to seek a solution to the problem.

Gerald Novak, the Whiting school district superintendent, said he supports the agreement, adding that more revenues are needed to equalize school funding disparities.

"We are the highest in per pupil spending in the state," Mr. Novak said. "I support equalization but I don't support Robin Hood plans that would take from the rich and give to the poor."

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