A U.S. District Court judge has ordered the D.C. public school system and the District government to pay more than $700,000 in fines and legal fees for its past failure to provide adequate transportation for special education students.

Judge Paul Friedman, in decisions released late last week, also has accused city attorneys fighting a class-action lawsuit of taking positions that raised "serious ethical concerns."

Friedman told the two defendants in the suit--the city and schools Superintendent Arlene Ackerman--to begin paying the court $400,000 in fines, in $100,000 monthly installments, starting Aug. 15. He ordered that another $317,655 be paid to a D.C. law firm that has been representing families of special education students in a class-action suit against the school system since 1995 but has not been paid for more than a year.

Some $147,000 is to be paid within 10 days from a city settlement fund, not the school budget. And $170,600 more is to be paid from a Court Registry made up of fines collected earlier from the school system, the order said.

"A review of the papers submitted by the parties and the recent history of this case make clear that the relationship between opposing counsel has deteriorated and that the Office of the Corporation Counsel now is acting in a punitive way" toward the law firm representing special education families, Friedman wrote. He said it was "unconscionable" for the District to expect the firm to go without compensation for so long.

Special Deputy Corporation Counsel Walter A. Smith Jr. said city attorneys may appeal part of the award to the law firm, Feldsman, Tucker, Leifer, Fidell & Bank, and the court's order to pay the $400,000 fine.

"It's a substantial amount of money . . . and there's no free lunch," said Smith, who is believed to be among the candidates being considered by Mayor Anthony A. Williams for appointment as corporation counsel, the city's top lawyer. "It's money that comes right out of the [D.C. public schools] budget, so you are diverting funds that might have been used for some [special education] programs."

But Feldsman, Tucker lawyer Beth Goodman said city and school officials could avoid all the fines and lawyers fees if they simply followed the law. She noted that while the school system persuaded Congress last year to cap the fees it must pay to lawyers who successfully sue the system on behalf of special education students, the system itself pays much higher fees to outside attorneys for working on its cases.

"The mayor should read these opinions and take a long hard look at what is going on in the Office of the Corporation Counsel," she said. "I feel certain that, with the mayor's support, the necessary steps can be taken to ensure safe and appropriate special education transportation services and to conclude this litigation without incurring additional unnecessary expense to the District."

Ackerman was not available for comment.

The orders come at a time when Ackerman has been trying to overhaul the special education program, which for more than two decades has failed thousands of D.C. children with emotional, physical or learning disabilities. More than one in 10 students in the 71,000-student system need special education.

Recently Ackerman hired a director of special education and settled two of three pending class-action lawsuits. The remaining suit, known as the Petties case, deals with several special education problems, including transportation and failure to pay private schools and others providing services to thousands of schoolchildren.

Some of the problems Ackerman faces in Petties occurred before she became superintendent. But parents report that transportation difficulties persist even though a national firm, Laidlaw, began working for the school system in June to resolve them.

When Petties was first filed in 1995, a key issue was that students were being transported in unsafe vehicles. The school system finally obtained more than 300 new buses but then was failing to pick up students in a timely manner. In the past year, there have been other problems, including dozens of unqualified drivers being fired.

Over the past few years, Friedman has imposed more than $6 million in fines on the school system for various special education failings. Until now, however, the court has required the school system to pay only about $350,000.

In Friday's orders, Friedman agreed to waive $2.2 million in fines, leaving more than $4 million owed. The separate $400,000 in fines specifically targets the school system for violating court orders last year by failing to provide sufficient bus service to get students to school on time.

Also Friday, Friedman again criticized attorneys in the corporation counsel's office, which is representing the school system. He complained, for example, that the city's lawyers said that two Petties defendants in different cases had different legal interests when it came to deciding which lawyers should be paid by the city.

Such a position, Friedman wrote, raises "serious ethical concerns."

"It now appears that the Office of Corporation Counsel is trying only to protect [the city's] Settlement and Judgment Fund until the end of the fiscal year and to penalize lawyers who are involved in court litigation rather than administrative proceedings--or perhaps just to penalize the lawyers in this case," Friedman wrote.

Smith said he and his colleagues were not being punitive but believe the various cases against the school system were different and required different approaches. "We don't believe there was an inconsistency," he said.

The battle over legal fees that the school system must pay to attorneys who represent families who successfully sued the District has been ongoing for years. Ackerman, noting that the school system paid more than $10 million two years ago, last year got Congress to approve a cap of $50 an hour for parents' counsel, with fees per case not to exceed $1,300.

The one-year cap will soon expire, and she has asked Congress to reimpose it. The cap provision is included in an appropriations bill that recently passed in the Senate.

Special education attorneys say the cap leaves students without legal recourse when their rights are violated because many cannot afford to hire attorneys. And they say that it is unfair for the school system to cap fees for the attorneys representing families while it has contracted with as many as five private law firms to help it with special education cases--at rates of up to $320 an hour with no per-case limit on fees.

In a separate order issued Friday, the judge approved a 23-point plan developed by all parties in the Petties case under which the suit could be dismissed. Smith said he hoped to resolve the remaining issues by the end of the next school year.