LITTLE ROCK (AP) — A federal judge on Thursday ruled that Arkansas’ approval of charter schools in Pulaski County did not violate its 1989 desegregation agreement with three school districts, and ordered both sides to come up with a schedule for hearings in the state’s bid to end millions in desegregation payments.

US District Judge D. Price Marshall rejected a request by the Little Rock School District and a group of black students and parents to find the state in violation of its agreement for approving charter schools. The district and the parents argued that the independently operated schools draw away students who could be participating in magnet schools and majority-to-minority transfers.

"No reasonable fact finder could conclude that the state is in material breach of the parties’ 1989 settlement agreement as to open-enrollment charter schools in Pulaski County," Marshall wrote. "The proof of any adverse effect beyond the margin or either the stipulation magnet schools or M-to-M transfers has not materialized."

The lawsuit had sought to prohibit the state from approving any new charter schools in Pulaski County and to order that existing charters be changed to comply with the terms and spirit of the 1989 agreement. An attorney for the Little Rock School District did not immediately return a call Thursday afternoon, and a spokesman for Attorney General Dustin McDaniel said he would comment on the ruling later in the day.

Arkansas is required by a 1989 settlement with the Little Rock, North Little Rock and Pulaski County school districts to fund magnet schools, transfers between districts and other programs to support desegregation and keep a racial balance in the three districts. Those costs add up to about $70 million a year.

In a separate ruling, Marshall denied Little Rock schools’ motion to dismiss the state’s request to be released from the desegregation agreement. He ordered the state and the districts to propose a timetable by Feb. 22 for hearings on the state’s effort to end the payments.

"A trial is needed to resolve whether the state should be released from the 1989 settlement agreement or whether changed circumstances warrant any modification of this court’s orders," he wrote.

Arkansas officials have long sought to end the settlement payments. Gov. Mike Beebe last year proposed cutting the state’s sales tax on groceries if certain budget obligations, including the desegregation payments, decrease by $35 million over a six-month period.