Category Archives: School Finance

House committee discusses teacher pensions, health care

The House Committee on Pensions met Thursday morning in Dallas to discuss items listed under the committee’s interim charges, including the Teacher Retirement System (TRS) of Texas.

The committee met in the chambers of the Dallas City Council, which oversees pensions for the city’s police and firefighters that have come under scrutiny as of late. Dallas Mayor Mike Rawlings was the first witness to testify, thanking the committee for legislation dealing with issues pertaining to Dallas police and firefighter pensions and updating members on changes the city has put in place since the legislation’s passage.

House Pensions Committee meeting May 10, 2018 in Dallas.

Executive Director Brian Guthrie testified for TRS, laying out the basics of the $152 billion trust fund that serves 1.5 million active and retired members. The fund earned a return of 12.6 percent for fiscal year (FY) 2017, under an assumed rate of return of 8 percent. The fund carries $35.5 billion of unfunded liability and is 80.5 percent funded with an amortization period of 32.2 years, which Guthrie noted will change if the assumed rate of return is lowered. TRS manages two major healthcare programs: TRS-ActiveCare for active teachers and TRS-Care for retirees. Guthrie testified that TRS undertook a study in 2013 looking at the fund’s defined benefit structure, and will be producing an updated study this fall.

Turning to health care, Guthrie described TRS-Care as a “pay as you go plan.” The state’s contribution to the plan is 1.25 percent of active employee payroll, while school districts contribute .75 of active employee payroll and active employees contribute .65 percent of their paycheck. Retirees contribute to the plan through premiums. The plan faced a $1 billion projected budget shortfall heading into the last legislative session, and lawmakers of the 85th Texas Legislature put $700 million into the system in order to keep the fund from folding. While the infusion was able to prevent retirees from losing their health care, it wasn’t enough to avoid increases in costs and reductions in benefits.

Even with the changes, which included increasing premiums, the fund faces a $400-600 shortfall heading into the next biennium and ongoing shortfalls moving forward. Guthrie attributed the increase to legislation accompanying the added funding that directed the agency to ease cost increases. Guthrie indicated the primary problem is with the fundamental design of the funding formula, noting that healthcare costs are increasing far more quickly than revenue received from active employee payroll, which is the basis for the funding formula.

The largest cost increases are associated with plans that include coverage for dependents, and TRS initially offered retirees the option of permanently leaving TRS-Care for an insurance plan on the private market. Chairman Dan Flynn (R-Canton), members of the committee and legislators representing the Dallas/Fort Worth Metroplex pressed Guthrie to find a way to protect benefits, in particular prescription drug costs. Guthrie testified that the agency is studying all possible avenues, but the fund design presents the largest challenge.

Finally, Guthrie explained TRS-ActiveCare as a group insurance program for small to midsize school districts that would be otherwise unable to provide their own insurance programs. The state provides $75 per member, per month through the school finance formulas, districts contribute a minimum of $150 per month, and individual members are responsible for the remainder. Minimum state and district contribution levels have not changed since the plan’s inception in 2002, and employees’ share of the premiums has increased to 60 percent from 30 percent over the last 14 years. Because of rising healthcare costs, TRS board members voted at their most recent meeting to raise premiums for individual members between five and nine percent, or seven percent on average.

Because TRS-ActiveCare is funded through the school finance formulas, Guthrie suggested that any changes to TRS-ActiveCare would best be addressed as part of lawmakers’ broader efforts to reform the school finance system.

House Public Education Committee Chairman Dan Huberty (R-Houston) sharply questioned Guthrie over the board’s anticipated July vote to lower the fund’s assumed rate of return to 7.5 percent from 8.0 percent, despite returning 12.6 percent for FY 2017. This would cost an additional $1.2 billion on top of the $400-600 extra needed for TRS-Care, for a total ask of $1.6 billion on top of the $3 billion in base funding already designated for TRS. Guthrie testified that the agency’s fiduciary responsibility requires staff to provide an accurate estimate of what the fund is anticipated to produce.

A representative from Arlington ISD asked the board to consider allowing school districts with more than 1,000 employees to opt out of TRS-ActiveCare and provide their own insurance programs, pointing out that family healthcare costs under the TRS-ActiveCare high-deductible plan could account for more than a third of a first-year teacher’s annual salary. Chairman Huberty noted that such an arrangement could adversely impact TRS funding by reducing the broader pool of active TRS members.

Texas Retired Teachers Association (TRTA) Executive Director Tim Lee thanked the Texas Legislature for making the minimum changes necessary to keep TRS-Care from failing entirely. Lee suggested that 14 years may have been too long to go without increasing premiums, and pointed to the Employee Retirement System (ERS) as an appropriate benchmark for TRS. Going forward, Lee testified the only long-term solution is pre-funding the program, which would be even more costly than migrating TRS members to ERS. Lee indicated that retirees will be unable to countenance further cost increases, and noted that 36,400 people have decided to leave TRS-Care for the individual market.

Staff from the Pension Review Board (PRB) testified regarding the agency’s efforts to improve defined benefit programs. The board has ordered staff to develop an online dashboard of Texas public pension data, to study potential legislative recommendations regarding how systems whose funding is set by legislative statute can respond to changes in market systems, to study how systems of scale could be utilized to improve groups of smaller plans, and to conduct intensive actuarial reviews of systems with risk that threaten their long-term stability. PRB staff noted that ERS has already lowered its estimated rate of return to 7.5 percent from 8 percent, which TRS is currently contemplating.

The committee then opened the table to public testimony, and dozens of retired teachers voiced their concerns regarding healthcare and the defined benefit structure of the TRS pension program. Many shared heartbreaking stories of seeing fixed incomes virtually consumed by skyrocketing premiums even before paying the increased costs for services and medication. Retirees also expressed concerns regarding changes to the assumed rate of return.

 

Teach the Vote’s Week in Review: May 4, 2018

It’s been a busy week of school finance discussions in Austin. Here’s your wrap-up of this week’s education news from ATPE Governmental Relations:


Panelists discuss school finance at an event hosted by the Texas Tribune and co-sponsored by ATPE on May 4, 2018.

The Texas Commission of Public School Finance and its various subcommittees or “working groups” were busy this week. The commission’s working group on expenditures for the Texas Commission on Public School Finance met this morning to discuss education spending. The working group is chaired by Rep. Dan Huberty (R-Kingwood), who also chairs the House Public Education Committee. Today’s meeting followed an appearance by Huberty and other commission members as part of a panel discussion on school finance hosted by the Texas Tribune. ATPE was a sponsor of that event.

At today’s expenditures working group meeting, several witnesses discuss funding formulas for special education and anticipated future funding needs for those programs. Learn more about today’s hearing in this blog post from ATPE Lobbyist Mark Wiggins who attended the meeting.

Texas Commission on Public School Finance working group on outcomes meeting May 2, 2018.

The Commission’s working group on outcomes met Wednesday to discuss early childhood education and post-secondary education among other topics. The group, which is led by Todd Williams of Dallas’s Commit Partnership, also includes high school teacher and ATPE member Melissa Martin, Rep. Diego Bernal (D-San Antonio), Sen. Larry Taylor (R-Friendswood), and Superintendent of Pflugerville ISD Doug Killian.

The working group on Wednesday listened to testimony from TEA Deputy Commissioner Penny Schwinn regarding the amount of money Texas spends per student on testing and whether or not more online testing is a viable option for the future. Schwinn also gave testimony on kindergarten readiness, stating that only 59 percent of Texas children are prepared when they enter kindergarten.

H.D. Chambers, Superintendent of Alief ISD, gave testimony about a “teacher crisis” currently facing Texas, noting that any meaningful change in education policy must be accompanied by a raise in teacher pay. Chambers also gave input on how improved professional development programs have raised the quality of pre-k in his district, the potential benefits of public-private partnerships for pre-k, and the difference between traditionally certified and alternatively certified teachers. Chambers questioned the STAAR test as an accurate measure of student progress.

Read more about the outcomes working group meeting here in this blog post by ATPE Lobbyist Mark Wiggins.

 


The full School Finance Commission also met Thursday to discuss early childhood education, the weights and allotments under the states’ current budget, and the Permanent School Fund.

Testimony provided by Alexandra Hale of Good Reason Houston suggested that veteran teachers be placed in pre-k classrooms to maximize impact. Meanwhile, former U.S. Undersecretary of Education, Linus Wright suggested the elimination of grade 12 in order to provide more funding for early childhood education. TEA Chief School Finance Officer Leo Lopez offered testimony regarding the six categories (special education, compensatory education, career and technical education, Public Education Grants, and the High School allotment) that receive weighted funding under the current school finance structure and account for 28% of the state’s Tier I education funds. Lastly, outgoing SBOE member David Bradley (R-Beaumont) updated the commission on the status of the Permanent School Fund (PSF).

ATPE Lobbyist Mark Wiggins was on hand to cover the meeting described more in depth in this blog post.

 


Texas Commissioner of Education Mike Morath announced Tuesday that six school districts are seeking “Turnaround Partnerships.” The partnerships were created with the passage of Senate Bill (SB) 1882 during the 85th legislative session in 2017, and they allow for districts with campuses that fall into the Improvement Required (IR) status of the state’s accountability system to enter into partnerships with institutes of higher education, non-profits, government entities, or charter school in order to improve education outcomes. The six districts seeking partnerships are Austin ISD, Ector County ISD, Hearne ISD, San Antonio ISD, Victoria ISD, and Waco ISD. You can find more details here.

 


ELECTION UPDATE: Tomorrow, May 5th, marks the first of two important elections that will be happening this month. At stake in tomorrow’s election will be issues specific to your community like school board elections and school bond propositions. These are important elections that set the tone for the local policy decisions and funding of your community’s public schools. All registered voters are eligible to vote in tomorrow’s election, although not all voters have municipal races or proposals on their ballots. To find out what’s on your local ballot, visit your county election website, use VOTE411.org to generate your local election voter guide, or check out the resources available from your local League of Women Voters. As part of our commitment to supporting a culture of voting, ATPE encourages all Texas educators to find out about their local elections and vote in every election possible, starting tomorrow, May 5.

If you happen to live in House District 13, you’ve also got a special election happening tomorrow, May 5. Voters in that district will select a new state representative to fill the unexpired term of former Rep. Leighton Schubert, who recently resigned from office. The same candidates running in tomorrow’s special election are also on the ballot this election year for a full term of office to begin in January 2019. Learn more about the race in this article from the Texas Tribune.

For many Texas voters, there is a second opportunity to vote this month. The second round of primary elections, where many of the state’s elections will be decided, will take place on May 22nd with the Democratic and Republican party runoff elections. As we approach that date, ATPE is highlighting a few of the runoff contests where education has emerged as a preeminent topic. Find out more about the Republican candidates competing for the votes of House District (HD) 4 residents in this latest blog post by ATPE Lobbyist Monty Exter. Stay tuned to the Teach the Vote blog next week for more runoff previews, and be sure to check out our candidate profiles here on Teach the Vote.

 


 

SFC outcomes group looks at testing, kinder readiness

The Texas Commission on Public School Finance working group on outcomes met Wednesday afternoon at the Texas Capitol to discuss early childhood education, post-secondary readiness, and post-secondary completion and assessments.

Texas Education Agency (TEA) deputy commissioner Penny Schwinn was the first to testify before the working group, which is led by Todd Williams and includes Pflugerville ISD Superintendent Doug Killian, state Sen. Larry Taylor (R-Friendswood), state Rep. Diego Bernal (D-San Antonio) and high school teacher Melissa Martin. Schwinn said that Texas spends $7 per student on testing. Sen. Taylor pursued a line of questioning that indicated support for going to more online testing, asking Schwinn to explain the security and cost benefits of online tests versus those using pen and paper.

Texas Commission on Public School Finance working group on outcomes meeting May 2, 2018.

Schwinn testified that online tests are cheaper and suggested there could be some security benefits by reducing the potential for physical tests getting lost in the mail. Sen. Taylor suggested online tests would give districts more flexibility in determining test dates and allowing follow-up tests later in the school year. Rep. Bernal stated concern over connectivity, in particular with regard to districts that may not have reliable internet access. Schwinn noted that recently-passed legislation allows districts to spend instructional materials allotment (IMA) funds on technology.

According to Schwinn, only 59 percent of Texas children are “kindergarten-ready.” Just 45 percent meet grade level expectations in third grade reading. The overwhelming data show students with high quality early childhood education are significantly more likely to graduate from school. According to Schwinn, funding universal pre-K for four-year olds would cost the state $1.7 billion. Universal pre-K for three- and four-year olds would cost $3.4 billion.

Schwinn also noted that significant performance gaps remains between white and non-white students, as well as economically disadvantaged and non-economically disadvantaged students. Regarding special education, Schwinn said far fewer Texas students receive special education services for dyslexia than students nationwide. Dr. Killian pointed out that is likely a result of the erstwhile special education “cap” instituted by the agency.

Alief ISD Superintendent H.D. Chambers appealed to the group to provide the necessary funding to achieve the desired outcomes of policymakers and practitioners. Chambers indicated that educators must also be paid better salaries. Barring these, Chambers warned that efforts to institute better education policies will be doomed to fail.

With regard to early childhood education, Chambers attributed improvements in kindergarten readiness in Alief ISD to better professional development for pre-K teachers and putting better quality teachers in pre-K classrooms. Chambers suggested public-private partnerships could be a viable option without additional state funding for pre-K. Chambers also affirmed there is a meaningful difference in quality between alternatively certified teachers and those trained by traditional programs, despite an increase in the employment of less qualified alternatively certified teachers.

Sen. Taylor made clear that any increases in teacher pay should not be across the board, rather they should go to the highest performers. Martin, a teacher, noted the overwhelming pressure placed upon teachers, not to mention the steadily increasing costs of health care without a commensurate increase in pay. Chambers testified the state is in the middle of a “teacher crisis” in which not enough qualified teachers are available to meet the demands of schools.

On the subject of testing, Chambers questioned whether the STAAR is as useful and accurate as previous tests such as the TAAS and TAKS. While Texas schools saw steady improvement on the previous tests, Chambers pointed out that STAAR scores have stagnated. Killian joined this theme by raising concerns over the usefulness of STAAR data compared to previous tests.

The full commission will meet Thursday.

School finance commission focuses on tax policy

The Texas Commission on Public School Finance met today in Austin to cover an agenda focused on tax policy. The day included invited testimony from a series of witness representing both out-of-state entities and Texas-based stakeholders.

National representatives offered individual assessments of the Texas taxing structure as well as perspectives on various reforms. The representatives hailed from the Tax Foundation, Tulane University’s Murphy Institute, the Lincoln Institute of Land Policy, and the Institute on Taxation and Economic Policy. Their individual presentations centered around a variety of policy reforms, including revisions to the property tax, an expansion of the sales tax base, changes to corporate taxing, better tax transparency policies, an update to the gas (or vehicle usage) tax, and a focus on more targeted relief over broad based relief. The broad look at tax policies seemed to drive an overall message that some combination of reforms is the best approach.

The commission also heard from the Texas Education Agency and the Comptroller’s Office regarding Texas’s current sources of funding for public education. The high-level presentation focused on the coordinating chart, which identified the Foundation School Program appropriations and their 2018-2019 biennium levels.

Texas-based entities invited to testify included a range of stakeholders. While many of the same broad tax policy reforms mentioned by the national panelists were addressed, the group offered perspectives more narrowly focused on the Texas taxing and school finance systems. For example, one testifier highlighted a lack of taxpayer transparency with regard to how certain tax revenues are directed. While some education funding is diverted to other budget areas, other revenue is used to supplant the state’s share of education funding when those dollars are intended to be supplemental funding.

Links to the witnesses presentation materials can be found here and a recording of the meeting can be viewed here. The commission’s Working Group on Expenditures will meet tomorrow morning and will hear invited testimony on the cost of education index, compensatory education, and the transportation allotment.

Public Education committee looks at A-F implementation

The House Public Education Committee met Wednesday for an interim hearing on the implementation of school finance, accountability, and bullying legislation, in addition to an update on the impact of Hurricane Harvey on the public school system.

Texas Education Agency (TEA) Chief School Finance Officer Leo Lopez kicked off testimony with an update on money given out as part of a two-year hardship grant program under House Bill (HB) 21, as well as additional facilities funding for charter schools. Associate Commissioner Monica Martinez provided a briefing on new autism and dyslexia grant programs under the bill. Chairman Dan Huberty (R-Houston) noted that the hardship grants as well as the autism and dyslexia grant programs will expire without additional legislation. Additionally, the bill contained a one-time payment into the Teacher Retirement System (TRS).

House Public Education Committee interim hearing April 18, 2018.

A representative from Houston ISD testified that the district faces a $150 budget deficit this year and a projected $320 million deficit in the next fiscal year due to the district entering recapture. The district submitted a number of recommendations, including increasing funding weights for bilingual, English as a second language (ESL), and special education students, restoring the state’s share of funding to 50 percent, increasing transportation funding, and doing away with the recapture system.

A number of witnesses testified with respect to the hardship grants, warning that some small districts could face closure without further action to extend the grants or create an alternative source of revenue.

Lopez next updated the committee on the implementation of Senate Bill (SB) 179, or “David’s Law,” which addresses bullying and cyberbullying. The law requires TEA to work with the Health and Human Services Commission (HHSC) to develop a website with resources for school districts. Huberty noted that more work must be done to inform districts, students, and parents of the various provisions of the new law.

TEA Commissioner Mike Morath provided another update on the impact of Hurricane Harvey on the public school system. A total of 60 counties fell under the governor’s disaster proclamation, and 1.5 million students were in an affected school district. Morath noted that while the Federal Emergency Management Agency (FEMA) has been an important source of long-term recovery funds, the agency has been slow in making funds available.

The agency has launched a variety of mental health services, and provided accountability flexibility to affected districts. This includes waivers from 5th and 8th grade math and reading exams for all students affected by the storm. At the school and district level, the agency collected information regarding full and partial facility closures or relocations, student displacement, and staff displacement. According to Morath, at least 112,000 students were displaced statewide. Those three sets of data will be used to develop a rule to determine whether an accountability rating is issued to a particular school. Morath indicated a proposed rule will be published in the Texas Register sometime in early June, and the number of exempt schools could number over a thousand.

Morath suggested the final rule for Harvey-affected schools will be “substantially more generous” than the rule developed following Hurricane Ike in 2008. State Rep. Alma Allen (D-Houston) told Morath she would like to see a rule that provides for entire districts to be exempt from accountability ratings as well, though Morath offered no indication whether the agency is inclined to move in that direction. Vice-chair Diego Bernal (D-San Antonio) asked TEA to help develop recommendations for additional revenue sources for public education. Chairman Huberty warned TEA to leave that work to legislators.

The storm caused some $970 million worth of damage to public schools. Morath estimated lawmakers would be faced with the need to pass a supplemental appropriation to cover an associated decline in maintenance and operations (M&O) property values of roughly $500 million to $1 billion.

Houston ISD Board of Trustees President Rhonda Skillern-Jones testified about the storm’s devastating impact on the state’s largest school district, and the associated financial difficulties. The district asked for a one-year accountability pause, such as was provided after Hurricanes Katrina and Ike, for all schools in a county that fell under the governor’s disaster declaration. State Rep. Harold Dutton (D-Houston) asked how the district’s ten worst-performing schools were impacted, all of which are labeled “improvement required” under the current state accountability system and face imminent sanctions. The district indicated those schools sustained damage as well, and contended that a pause would not prevent those schools from being subject to potential TEA takeover, since a decision on each of those schools is required by April 24.

Finally, the committee heard testimony on HB 22, which made changes to the forthcoming “A through F” accountability system. TEA released a framework of the new system last week. Morath summarized that framework, and testified that cut points are being based upon last year’s performance and will be set for the next five years. District A-F ratings will be released in August, while individual campuses will continue to be labeled “met standard” or “improvement required.” Campus A-F ratings will be released in August 2019.

Alief ISD Superintendent H.D. Chambers testified that the local accountability system provided by HB 22 could be promising. Under the first domain, Chambers suggested changing the weights for STAAR; college, career, and military readiness (CCMR); and graduation rates from 40/40/20 under the current framework to a more even 33/33/33 or 35/35/30. Chambers also lamented the lack of indicators other than STAAR for grades three through eight under the new system, which represents a regression from the previous system.

Chambers asked that a greater weight under the CCMR indicator be given to students who complete a concurrent sequence of career and technical education (CTE) courses. Critically, Chambers cautioned that policymakers will be disappointed with the results of any accountability system until resources are aligned with what is asked of students and schools.

Spring Branch ISD Executive Director of Accountability and Research Keith Haffey similarly testified to the complete reliance on STAAR at the elementary level, and suggested considering additional metrics. One such metric could credit schools that fully transition English language learners (ELLs) to English. Additionally, one of the flaws of the new system is that the scoring limits credit given to students who take college pathway assessments such as the PSAT, SAT, or ACT, which acts as a disincentive for districts to offer these valuable exams. Huberty engaged Morath and Chambers in a conversation regarding the feasibility of providing a state appropriation to cover the cost of providing these assessments.

Dee Carney, an associate with school finance firm Moak, Casey and Associates, introduced model runs under the new accountability system. According to the models, most schools are unlikely to earn an “A” rating under the first domain. Carney testified that the additional of non-test indicators helps raise scores. The remainder of the day’s testimony largely focused on the system’s heavy reliance on the STAAR test.

Teach the Vote’s Week in Review: April 6, 2018

Here’s a wrap-up of your education news from ATPE:


The Texas Education Agency (TEA) made several announcements this week regarding the draft plan to address special education in Texas. In addition to accepting public comments on the latest version of the draft plan, TEA has scheduled two hearings where members of the public are invited to express their input. Information on the two meetings is as follows:

  • Thursday, April 12, at ESC Region 1 – 1900 West Schunior, Edinburg, Tx.
  • Monday, April 16, at ESC Region 10 – 400 East Spring Valley Road, Richardson, TX.

Both meetings will begin at 1 pm, and those wishing to share feedback are asked to register onsite beginning at 12:30 pm (registration will end when the meeting begins). Registered participants will be called in the order they are registered and will be limited to three minutes. The hearing will end when all have testified or at 3 pm, whichever comes first. Those unable to attend either hearing can submit their written comments by email at TexasSPED@TEA.texas.gov by April 18 at noon.

To learn more about the two public hearings and the chance to submit written testimony, view TEA’s full press release, visit TEA’s special education webpage, and read ATPE Lobbyist Mark Wiggins’s post from earlier this week.

 


Texas Commissioner of Education Mike Morath sent a letter to school administrators today regarding three recent changes to how the spring 2018 State of Texas Assessments of Academic Readiness (STAAR) exams will be administered. The three changes involve offering medical exemptions for qualifying students, allowing for the transcribing of student responses that are recorded in the test booklet onto a blank answer document, and relaxing the rules around classroom displays. His letter indicates these moves are being made in response to district feedback and in an effort to “do all I can to help make this a positive experience and reduce stress for students and school district and charter school personnel.” Read Commissioner Morath’s full letter to learn more.

 


It was a busy Wednesday at the Capitol this week, and your ATPE Governmental Relations team was there to cover all the action. ATPE Lobbyist Monty Exter covered the Senate State Affairs Committee meeting, where pension and healthcare issues were the topic of discussion. That meeting included conversations about the factors affecting the Teacher Retirement System (TRS) of Texas pension fund and the TRS-Care retiree health insurance program. For more information on how the hearing unfolded, read Exter’s recap of the meeting or watch an archived webcast. You can find ATPE’s testimony, and other public testimony, at the end of the recording.

 


The Texas Commission on Public School Finance met this week in Austin for a discussion on property taxes and their role in the school finance system. A smaller working group of commission members met Wednesday to discuss outcomes. The highlight of Wednesday’s meeting was former Assistant U.S. Secretary of Education Tom Luce, who suggested it’s time to do “more with more, not more with less” when it comes to funding public schools in Texas. This was particularly compelling advice from Luce, considering he was a key player in the state’s last major school finance reform – all the way back in 1984.

All 13 members of the commission met Thursday to hear several panels discuss property taxes. While there was general agreement on the burden imposed by property taxes, the debate between some members over how to calculate the state’s share of public education spending continued anew. Importantly, state Rep. Diego Bernal (D-San Antonio) requested the state prepare a list of school revenue sources that have been cut over the last 10 years. You can read a full recap of Wednesday’s working group meeting by ATPE Lobbyist Mark Wiggins here, and a rundown of Thursday’s full commission meeting here.

 


The Senate Education Committee rounded out a busy Wednesday in Austin with a hearing to discuss interim charges related to virtual schools, “high quality education opportunities,” and the federal E-rate program. ATPE offered written testimony to the committee concerning the virtual education charge, cautioning against moves to further expand the Texas Virtual School Network without carefully considering the status of virtual schools’ performance. Recent research highlights concerns regarding these schools nationwide and a look at Texas accountability measures fail to paint a drastically different picture in Texas. ATPE Lobbyist Kate Kuhlmann was at the hearing and offers more on the discussion here.

 


 

School finance commission talks property taxes

The Texas Commission on Public School Finance met Thursday morning in Austin to discuss the role of tax revenue in the school finance system. Chairman Justice Scott Brister began the meeting by apologizing for comments about disabled children he made during a meeting of the working group on expenditures.

Texas Commission on Public School Finance meeting April 5, 2018.

“I never suggested that any group of kids should be excluded from public funding or from being educated,” said Brister. State Sen. Larry Taylor (R-Friendswood), who chairs the Senate Education Committee, blamed the media for taking Brister’s comments about “slow” children out of context.

Brister followed by announcing that the working groups are not working as intended, specifically noting that attempts to hold meetings by teleconference have yielded less than stellar results. The chairman suggested members may instead call additional witnesses to the full commission’s May and June meetings and postpone working group recommendations to later in the year.

Additionally, Brister indicated what sort of recommendations he is seeking. Those recommendations include “how to get more with what you’ve got,” “all you can get from the taxpayers otherwise,” and how to address the concerns of those who argue still more funding is needed.

The chairman also offered a brief recap of suggestions submitted during public testimony last month. Those recommendations included raising the basic allotment for all students, increasing funding for gifted and talented and special needs students, funding pre-K, funding smaller class sizes, mentoring teachers, restoring additional state aid for tax relief (ASATR) funding, increasing teacher salaries and reducing health care costs for active and retired teachers, updating the cost of education index (CEI), and restoring state funding to at least 50 percent of the burden of paying for schools.

Texas Education Agency (TEA) Chief School Finance Officer Leo Lopez was the first to testify, and outlined state sources of school revenue. State Sen. Paul Bettencourt (R-Houston) argued for recapture, or “Robin Hood” taxes paid by local taxpayers, to be counted as state funding. House Public Education Committee Chair Dan Huberty (R-Houston) pointed out that the state comptroller has consistently counted recapture as local funding. If recapture were counted as state funding, it would falsely inflate the percentage of school funding contributed by the state, which is currently around 38 percent.

The next panel featured a pair of representatives from the comptroller’s office. Texas does not have a statewide property tax, but it does have a statewide sales tax. Various sales taxes account for around two-thirds of all state revenue collections. Collections from the business franchise tax, which was initially created in order to help ease the property tax burden on homeowners, have steadily shrunk as lawmakers have chipped away at the tax over time. State Rep. Diego Bernal (D-San Antonio), vice chair of the House Public Education Committee, asked the comptroller’s office to prepare a report on education funding streams that have been cut by the legislature over the past ten years.

San Jose State University Professor Anette Nellen presented what an ideal tax system should consider, and her presentation led to a spirited conversation about whether the internet should be taxed. Nellen was followed by former chief revenue estimator James LeBas, who offered a summary of a book he wrote on tax law turning points. LeBas concluded that previous attempts to “buy down” local property taxes were thwarted by increases in property values, bond elections and other factors. He argued no such effort will be successful without continuously increasing funding, restricting local tax increases, or some combination of both.

The final panel involved testimony from several businesses, including Phillips 66, Texas Instruments and P. Terry’s Burger Stand. Business interests emphasized that taxes are a major consideration when it comes to where companies choose to locate and do business. A representative from the Texas Association of Builders testified that high property taxes are a hurdle to home ownership, however many homeowners choose where to buy based upon the quality of local schools. Patrick Terry, the founder and owner of P. Terry’s, testified that the rapid increase in property taxes is making it more difficult to provide discretionary benefits to employees and make charitable contributions to community organizations. More significantly, Terry suggested it is likely discouraging more entrepreneurs from entering the economy. Wayne Gerami, vice president at Austin Habitat for Humanity, suggested that some states utilize a “circuit breaker” provision, which caps an individual’s property tax burden at a certain percentage of their income.

Before adjourning, Brister confirmed that the reports from commission working groups will be delayed until September. The commission is scheduled to meet again on April 19.

Finance commission working group on outcomes meets

The Texas Commission on Public School Finance working group on outcomes met Wednesday evening for the subcommittee’s first formal public meeting. The group is led by Todd Williams, the education advisor to Dallas Mayor Mike Rawlings, and includes House Public Education Committee Vice-chair Diego Bernal (D-San Antonio), Pflugerville ISD Superintendent Dr. Doug Killian, Senate Education Committee Chair Larry Taylor (R-Friendswood), and Melissa Martin, who was absent.

Texas Commission on Public School Finance working group on outcomes meeting April 4, 2018.

The first invited witness was former U.S. Assistant Secretary of Education Tom Luce, who emphasized that education is the future of Texas. Luce began by warning that Texas schools are not preparing students for post-secondary success. Furthermore, an ill-prepared workforce will lead to decreasing median incomes and an increased financial burden on the state.

“We have to do more with more, not more with less.” said Luce, who suggested looking to current tax exemptions for ways to generate additional revenue. “Money matters.”

Luce served as chief of staff to the Texas Select Committee on Public Education in 1984 and participated in the last major reform of the Texas school system. Without another reform, Luce predicted Texas is doomed to fall behind academically and economically. Reforms suggested by Luce include offering incentives for students to take AP exams, full day pre-K, and boosting overall funding. In order to secure the necessary additional funds for public schools, Luce argued stakeholders must explain to taxpayers what the system is going to accomplish differently than what it is currently doing.

Other witnesses laid out similarly concerning views of the state’s current success preparing students for post-secondary success, whether that means pursuing career certification or finishing college. Failure to achieve post-secondary success means graduates entering the workforce and settling for lower-wage jobs, leading to more reliance on government entitlement programs. Together, this means a degraded tax base increasingly unable to support the social safety net programs upon which it relies.

A representative from the Commit Partnership in Dallas, of which Williams is chairman and CEO, drew attention to student demographics and the link between race and poverty in Texas. In addition, performance gaps between demographic groups have remained constant despite improvement in the overall student population. In order to close these gaps, Commit suggested focusing on pre-K and third grade literacy. Dr. Killian indicated he has seen the number of children who are unprepared for kindergarten increase over time, but access to pre-K has proven an effective way to counter this trend.

Commit managing director Sagar Desai suggested that internal surveys indicated just one in four new teachers felt adequately prepared by alternative certification programs with less rigorous training. Additionally, higher rates of poverty correlate with higher percentages of beginning teachers, which also correlates with lower student achievement.

Deputy Commission David Gardner from the Texas Higher Education Coordinating Board (THECB) was the last to testify, and offered an explanation of the “60×30” graduation goal. The plain aims for 60 percent of Texas high school graduates to complete a post-secondary degree or certificate by the year 2030. Gardner pointed out that the longer students wait between graduating from high school and entering college, the less likely they are to graduate from college. At the end of the meeting, Killian told Gardner he believes the higher education system should have an accountability system just like the K-12 education system.

The full commission is set to meet Thursday morning, when it will discuss issues related to tax revenues.

Teach the Vote’s Week in Review: March 23, 2018

Here’s a look at this week’s education news highlights from the ATPE lobby team:


Congress advanced the omnibus spending bill to President Trump overnight and it received his signature this afternoon. The $1.3 trillion spending plan played out in a dramatic fashion, emerging Wednesday with support from both Republican and Democratic leadership, but with some waffling from President Trump.

After a bipartisan U.S. House vote of support (256-167) on Thursday and a similar vote in the Senate (65-32) that followed early Friday morning, President Trump again expressed consternation over the deal. He tweeted that he was considering a veto based on two missing pieces: full funding for his border wall and a plan for individuals that fall under the federal Deferred Action for Childhood Arrivals (DACA) program.

Ultimately, President Trump signed the legislation, but not without additional expressions of concern. Before the press this afternoon, he called the bill a “ridiculous situation” and told Congress he would never vote for a bill like this again, referring to its high price tag and lack of transparency. Trump said he was only signing it because it was a matter of national security and included increased spending for the military, the largest in history. He also highlighted several things he considers wins, like some initial funding to begin work on his border wall and dollars to address the opioid epidemic.

President Trump’s signature prevents a government shutdown that loomed at midnight tonight. Learn more about the spending plan, particularly as it relates to a funding boost for education, in this post from ATPE Lobbyist Kate Kuhlmann.

 


ATPE Lobbyist Monty Exter testified before the Texas Commission on Public School Finance on March 19, 2018.

The Texas Commission on Public School Finance met in Austin this week on Monday, March 19. The commission spent the day taking both invited and non-invited testimony from the public as the members consider their recommendations to the 86th Legislature for modifying the state’s school finance system. ATPE Lobbyist Monty Exter offered public testimony on behalf of ATPE, highlighting ways the school finance system could be overhauled to provide property tax relief. (The commission previously heard invited testimony from ATPE Executive Director Gary Godsey during an earlier meeting last month.) Read a full recap of Monday’s hearing and the extensive public testimony in this week’s blog post.

Ahead of Monday’s meeting, a consortium of education groups briefed the media on a new poll showing that most Texans support increasing the amount spent on public education. For more on the poll results, check out this blog post from ATPE Lobbyist Mark Wiggins.

A subcommittee or working group of the school finance commission tasked with studying school expenditures also held a meeting the following morning to take additional testimony relative to their charge. The working group is chaired by Rep. Dan Huberty, who also chairs the House Public Education Committee. Read more about Tuesday’s working group session here.

The chair of the full commission sparked controversy this week after he made comments questioning whether the state should spend money on students he referred to as “slow learners.” Special education advocacy groups were quick to complain about Chairman Scott Brister’s remarks, as reported by the Austin American-Statesman in this article that also features a quote from ATPE’s Exter.

The next meeting for the Commission will be on April 5, 2018 at 9 a.m. in the William B. Travis Building, Room 1-104, located at 1701 N. Congress Ave., Austin, TX. The meeting will be webcast at: http://www.adminmonitor.com/tx/tea/.

 


The Texas Education Agency (TEA) released its Draft Special Education Improvement Plan and Corrective Action Response this week to fix critical failures in the state’s special education system. The draft plan varies little from an initial draft the agency circulated in January, and the agency is seeking public comment on the latest version. You can e-mail feedback to TexasSPED@tea.texas.gov.

The plan carries a $211 million price tag, which does not include a substantial cost anticipated to be incurred by local school districts. The districts will be expected to perform the bulk of the work meeting the needs of children who were wrongfully denied special education services in the past due to districts’ following a TEA directive to limit special education enrollment. Because of this funding challenge, many school administrators are warning they will need additional financial support from the state in order to properly serve qualifying children. The Texas Council of Administrators of Special Education (TCASE) noted this in a press release this week, saying the TEA plan “is rich with school district monitoring and compliance measures, but fails to offer adequate financial and other support to districts.” Read the full TCASE press statement here.

 


Interim legislative hearings are in full swing now, and multiple committees are discussing how to address the state’s funding challenges that have a direct impact on public education.

Earlier this week, the Senate Finance Committee met to consider “options to increase investment earnings of the Economic Stabilization Fund,” often referred to as the state’s rainy day fund. Texas State Comptroller Glenn Hegar warned this week that the state could face a downgrade of its credit rating if it does not look at changing the way the $11 billion fund is invested. Decisions about the fund could have future implications for how the state funds teacher pensions and other education-related endeavors. ATPE Lobbyist Monty Exter has written more about the hearing in his blog post this week.

Another tough issue being debated by numerous committees this interim is teacher compensation. Several high-profile elected officials running for re-election have made teacher pay raises a key talking point in their campaign messaging, but few concrete plans or identified sources of funding have been proposed. On Monday, March 26, the Senate Education Committee will take its turn at debating the issue. ATPE Lobbyist Kate Kuhlmann has been invited to testify on the issue. Stay tuned to our blog next week for updates on this and other hearings.

 


 

Teach the Vote’s Week in Review: March 16, 2018

It’s your St. Patrick’s Day weekend edition of ATPE’s Week in Review for Teach the Vote:


The Texas Commission on Public School Finance is meeting next week and plans to hear public testimony for the first and only time on Monday. For more about the hearing and how you can submit input by email, check out this post on our blog. The commission has already heard invited testimony from ATPE Executive Director Gary Godsey, and ATPE Lobbyist Monty Exter will also be sharing recommendations with the commission next week.

The commission’s hearings this interim are taking place amid growing concerns that the entity’s final report to the legislature will contain few beneficial recommendations. For more, read the Texas Tribune’s latest article about the commission, featuring a quote from ATPE’s Exter, republished here on Teach the Vote. Stay tuned for updates from the commission next week.

 


ELECTION UPDATE: Now that the dust has settled on the March 6th primary election, ATPE’s Governmental Relations team is turning its attention to races that are headed to a runoff in May. ATPE Lobbyist Mark Wiggins has written about what’s at stake in the runoffs with a list of which districts are in play. Check out his post here.

Also on our Teach the Vote blog this week, we’ve republished an article from the Texas Tribune about Attorney General Ken Paxton’s continued efforts to harass school districts over what he deems to be “illegal electioneering” activities. Many of the districts targeted by AG Paxton with “cease and desist” letters are those that participated in nonpartisan voter turnout efforts organized by the Texas Educators Vote coalition, of which ATPE is a member.

 


U.S. Education Secretary Betsy DeVos is scheduled to testify on Capitol Hill next week regarding President Trump’s education budget proposal. The U.S. House Appropriations Committee, which oversees the initial budget writing process for the House, will host Secretary DeVos before its Subcommittee on Labor, Health and Human Services, Education, and Related Agencies on Tuesday at 9am (CDT). DeVos is tasked with defending a budget proposal that represents a 10.5% decrease in education spending and dedicates significant dollars to programs focused on expanding public and private school choice.

The hearing is the beginning of a budget process that will unfold in both chambers. Beginning in subcommittees and then moving through the full committees, members will work to narrow in on budget drafts that will later be negotiated by the two chambers. Those chambers will then be tasked with coming to terms on a budget they pass and send to the President. Read more about President Trump and Secretary Devos’s education budget proposal here and find a more in-depth explanation of the federal budget process here (note: this post is from 2015 and also offers a look back at how a budget proposal under President Obama compared). A webcast of the hearing next week can be located here.