HELENA - Gov. Brian Schweitzer on Monday told Montana school officials they should shut down the lawsuit on public-school funding -but those who brought the lawsuit don't quite agree.

Schweitzer, speaking in Helena to members of the Montana Quality Education Coalition, said a two-year, $120 million funding increase and other action by the 2005 Legislature has complied with 2004 court rulings that said state funding for schools was inadequate.

The nearly 11 percent increase is the largest two-year increase in state money for schools since 1991.

The governor also indicated he'll ask the 2007 Legislature for more state funding of schools, and urged MQEC members to support sympathetic legislative candidates.

"No one has said that we are done," he said. "No one has said that we will not continue to put more money into K-12 education. We will."

Yet while MQEC leaders said Monday they agree with much of what Schweitzer said, they aren't dropping the 3-year-old lawsuit.

They also offered to have "settlement discussions" with Schweitzer or other state officials on how best to resolve the lawsuit, but the governor declined.

"This thing is addressed with money and legislation," the governor said in an interview later. "The way you settle this is exactly what we have done. We put money into (schools) and we addressed the relevant factors (listed by the court)."

MQEC is the coalition of school districts, school groups and individuals who spearheaded the 2002 lawsuit that led to the rulings saying Montana's public school funding system is unconstitutional.

The courts said the state is falling short of providing a "basic system of free quality public" schools.

Monday's exchange left the lawsuit and Montana's system of funding public schools in a sort of legal limbo, as MQEC said it will file a "status report" this spring with state District Judge Jeffrey Sherlock of Helena, who made the initial ruling of unconstitutionality in April 2004.

The report will be MQEC's assessment of whether legislative action addressed the funding and system shortfalls listed by Sherlock and the Supreme Court.

What happens next depends on how the state reacts to that filing, said Jim Molloy, a Helena attorney representing MQEC.

Molloy said the coalition may ask for a hearing on whether the court order has been met. The hearing could be after the 2007 Legislature, awaiting its action on school funding, he added.

MQEC officials have said the Schweitzer administration's funding efforts are welcome, but don't meet some of the inadequacies outlined by the court, such as funding for "at-risk" students or school buildings.

About 40 school officials from across the state attended MQEC's annual membership meeting in Helena Monday.

Schweitzer, who asked Monday morning to address the meeting, said his legal counsel has concluded the court order has been met, so the suit should be dropped.

He also said citizens across the state are telling him they don't like the idea of the schools suing the government, with taxpayers footing the bill for both sides.

Their message is "Can't we get this done in the Legislature?" Schweitzer said. "Isn't that what we elect people to do? I think we can do that. I think the next Legislature will continue to do that."

The campaign season for the next legislative elections is just under way, with Democrats attempting to maintain a majority in the Senate and improve on a 50-50 split with Republicans in the House. Schweitzer, a Democrat, appealed to MQEC members to campaign for and support candidates who will support his promise to increase school funding.

As Schweitzer prepared to leave the meeting, Molloy asked whether the state would meet with MQEC on settlement talks. Molloy said he always advises clients to attempt to look for a settlement.

Schweitzer, however, said he saw no need for such talks. He said later his administration would continue talking to education officials individually and "take information from them."

"You don't resolve a lot having lawyers talk to lawyers," he said.