United States Court of Appeals
                           FOR THE EIGHTH CIRCUIT
                                    ___________

                                    No. 04-1017
                                    ___________

Herbert Carter, individually and         *
on behalf of all others similarly        *
situated,                                *
                                         *
                   Appellant,            *
                                         * Appeal from the United States
      v.                                 * District Court for the
                                         * Eastern District of Arkansas
State of Arkansas; State and Public      *
School Life and Health Insurance         *
Board; Mike Huckabee, Honorable,         *
individually and in his official         *
capacity as Governor of the State        *
of Arkansas; John Hartnedy,              *
individually and in his official         *
capacity as a member of the State and    *
Public School Life and Health            *
Insurance Board; Preston A. Means,       *
individually and in his official         *
capacity as a member of the              *
State Public School Life and Health      *
Insurance Board; Joseph                  *
Thompson, Dr., individually and          *
in his official capacity as a member     *
of the State and Public School Life      *
and Health Insurance Board;              *
Janie D. White, individually and         *
in her official capacity as a member     *
of the State and Public School Life      *
and Health Insurance Board;              *
Bobbie A. Davis, Dr., individually       *
and in her official capacity as a         *
member of the State and Public            *
School Life and Health Insurance           *
Board; Darrell Montgomery,                *
individually and in his official          *
capacity as a member of the State         *
and Public School Life and Health          *
Insurance Board; Vance Strange,           *
individually and in his official          *
capacity as a member of the State         *
and Public School Life and Health          *
Insurance Board; Robert Watson,           *
individually and in his official          *
capacity as a member of the State         *
and Public School Life and Health          *
Insurance Board,                          *
                                          *
                    Appellees.            *
                                     ___________

                              Submitted: November 18, 2004
                                 Filed: December 17, 2004
                                  ___________

Before RILEY, McMILLIAN, and GRUENDER. Circuit Judges
                            ___________

McMILLIAN, Circuit Judge.

      Herbert Carter appeals from a final judgment entered in the District Court for
the Eastern District of Arkansas1 dismissing his federal equal protection and due
process claims against state officials for failure to state a claim under Fed. R. Civ. P.
12(b)(6). We affirm.


      1
       The Honorable James M. Moody, United States District Judge for the Eastern
District of Arkansas.

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       Carter, a former superintendent of the Marion, Arkansas, school district, is a
retired public school employee and a participant in the teacher retirement program
administered by the Arkansas State and Public School Life and Health Insurance
Board (the "Board"), which administers benefits plans for state employees and public
school employees. Carter filed the instant 42 U.S.C. § 1983 complaint against the
Governor of the State of Arkansas and eight members of the Board (collectively the
"state"), alleging equal protection and due process violations under the federal and
state constitutions. Carter first alleged that the state had violated his rights to equal
protection and due process because it contributed more for health insurance premiums
for state employees than for public school employees. He also alleged equal
protection and due process violations because retired public school employees who
received Medicare benefits paid the same premium as public school employees who
were not covered by Medicare.

       The state filed a Rule 12(b)(6) motion to dismiss, arguing that Carter had failed
to allege facts to support federal equal protection or due process claims. The district
court granted the state's motion and declined jurisdiction over the pendent state law
claims. Carter filed a timely appeal.

DISCUSSION

      We review the district court's grant of a Rule 12(b)(6) motion to dismiss de
novo, taking "all facts alleged in the complaint as true." Knapp v. Hanson, 

, 788 (8th Cir. 1999) (Knapp). "A motion to dismiss should be granted only if it
appears beyond doubt that the plaintiff can prove no set of facts which would entitle
him to relief." 

omitted).

      Because Carter is not a member of a suspect class and his claims do not involve
a fundamental right, his federal equal protection claims are subject to rational basis
review. Under this review, a court must reject an equal protection challenge to a

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statutory classification "'if there is any reasonably conceivable state of facts that could
provide a rational basis for the classification.'" 

(quoting FCC v. Beach
Communications, Inc., 

, 313 (1993) (Beach Communications)). Indeed,
"a legislative choice . . . may be based on rational speculation unsupported by
evidence or empirical data." Beach 

. Thus, because
"all that must be shown is 'any reasonably conceivable state of facts that could
provide a rational basis for the classification,' it is not necessary to wait for further
factual development." 

(quoting Beach 

). In other words, a district court may conduct a rational basis review on
a motion to dismiss. 

case, the district court did not err in dismissing Carter's federal equal
protection claims. First, Carter did not state a claim regarding the difference between
the state's contributions for health insurance premiums of public school employees
and state employees. As a threshold matter, in order "[t]o state an equal protection
claim, appellant must have established that he was treated differently from others
similarly situated to him." Johnson v. City of Minneapolis, 

, 862 (8th
Cir. 1998). Carter argues that public school employees are similarly situated to state
employees because the state is ultimately responsible for public school education.
Although the state may be responsible for public school education, the two groups are
not similarly situated for purposes of an equal protection analysis, which requires that
plaintiffs must be "similarly situated to another group for purposes of the challenged
government action.'' Hosna v. Groose, 

, 304 n.8 (8th Cir. 1996) (internal
quotation omitted). Moreover, the two groups must be similarly situated "in all
relevant respects." Bills v. Dahm, 

, 335 (8th Cir. 1994). Here, public
school employees and state employees are not similarly situated for purposes of this
lawsuit challenging the amount of employer contributions to employee health
insurance premiums because, as the state notes, the two groups have different
employers. Public school employees are employees of local school districts, not the
state. Ark. Code Ann. § 6-13-620(4)(A) ("Board of Directors of each school district

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. . . shall . . . [e]mploy teachers and other employees . . . and make written contracts
with teachers and all other employees"). See Arnold v. City of Columbia, 

, 1220 (8th Cir.1999) (holding that although plaintiffs were in same job grade
classification as other employees, they were not similarly situated with respect to
wage and hour equal protection challenge); Post v. Harper, 

, 495 (8th Cir.
1992) (rejecting equal protection challenge because county employee was "not
similarly situated, either in fact or in contemplation of law, to elected public officials
or to municipal employees").

       Even assuming that the two groups were similarly situated, Carter failed to
state a claim. At the time Carter filed his complaint a local public school district was
required to contribute $114.00 a month for employees participating in "the public
school employee health insurance program," Ark. Code Ann. § 6-17-1117(a), whereas
the state could contribute up to $350.00 for its employees' health benefits. 

21-
5-414(b)(1). As the district court held, it was rational for the state legislature to
require the employers of public school employees and state employees to bear
responsibility for health care contributions for their respective employees and that the
state could contribute more than a local public school district for employee health
insurance.

      Nor did the district court err in rejecting Carter's second equal protection
challenge. As the district court held, it was rational for the state to require Medicare-
covered employees to pay the same health insurance premium as those not covered
by Medicare, because it could have reasonably concluded that those over 65 have
higher health care costs.

      The district court also did not err in dismissing Carter's federal due process
claims. Because the challenged state actions survive rational basis scrutiny, Carter
has not stated a substantive due process claim. See Klein v. McGowan, 

,
710 (8th Cir.1999) ("To meet his burden [of establishing a substantive due process

                                           -5-
violation] a § 1983 plaintiff must demonstrate that the government action complained
of is truly irrational, that is something more than . . . arbitrary, capricious, or in
violation of state law.") (internal quotation omitted). The state argues that Carter
failed to state a procedural due process claim because he does not have a property
interest in health insurance premiums. Even assuming Carter has a property interest,
he has not stated a procedural due process claim because he is not challenging the
manner of any deprivation, such as the lack of notice or opportunity to be heard. See
Parrish v. Mallinger, 

, 615 (8th Cir. 1998).

       The district court also correctly dismissed without prejudice Carter's claim that
the state had illegally used public school employees' health insurance premiums to
subsidize state employees' health insurance premiums . Carter characterized the claim
as an unconstitutional taking of private property without just compensation, in
violation of the Fifth and Fourteenth Amendments. However, because he did not
allege that he had exhausted state court remedies, the district court did not err in
dismissing the claim. Kottschade v. City of Rochester, 

, 1040 (8th Cir.)
("Until [plaintiff] has exhausted his state court remedies, his [Fifth Amendment
takings] claim may not be brought in federal court."), cert. denied, 

(2003). We note that where, as here, a statute survives a substantive due process
challenge, "it would be surprising indeed to discover" that the statute constitutes an
unconstitutional taking. Connolly v. Pension Benefit Guar. Corp., 

, 223
(1986).

      Because the district court declined jurisdiction over Carter's pendent state law
claims, we do not address them.

      Accordingly, the judgment of the district court is affirmed.
                      ______________________________




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