Tag Archives: Austin ISD

Education investment: The key to real tax relief

Mortgage calculator. House, noney and document.If there’s one thing most Texans can agree on, it’s that property taxes are too dang high.

What gets dicey is trying to sort through the myriad schemes put forth in the last few years by state lawmakers trying to cut local taxes over which they have little direct control. They’ve proposed tweaks to the rollback rate, increased the homestead exemption, and filed bills targeting local appraisal districts. That’s a lot of work by a lot of smart people you’ve sent to Austin with your tax dollars.

So.

Does your tax bill look any better?

In 2013, the Lincoln Institute of Land Policy ranked Texas as having the 15th highest per capita property tax in the country. Despite our high property taxes, Texas ranks 45th in overall K-12 education spending and 49th in adjusted per-pupil expenditures, according to our performance on the “Quality Counts” state report card from Education Week.

Why is that?

Speaking to a joint hearing of the House Public Education and Appropriations Committees in September 2016, outgoing Appropriations Chairman John Otto (R-Dayton), put it simply. “The burden is shifting to the locals,” he said.

According to the Legislative Budget Board, local school spending, as approved by local voters and their elected school boards, increased 34 percent from 2008 to 2015. During the same period, the amount the state spent on local schools increased by just 4.8 percent.

The school finance relationship is like a see-saw, with state funds on one side and local tax dollars on the other. When state spending goes down, local school districts have to raise taxes in order to fund services at the same level. This year, the state will pay 38 percent of the cost to fund schools, while the burden that falls to local property owners will be 52 percent.

Under the state’s recapture rules for maintaining equity in our school finance system, those local taxes you pay are also tied to school districts all over the state. That means in cities with high property values such as Austin and now Houston, a significant chunk of local property tax revenue must be shipped out of town to help fulfill the state’s obligation to maintain funding equity in other districts.

The total amount of transfers under recapture – commonly referred to by some as “Robin Hood” – has grown to $2 billion, with Austin ISD accounting for $583 million of recaptured funds in 2016. The math works out to 28 percent of statewide recapture falling on the shoulders of local taxpayers in Austin alone.

This week, the House and Senate each submitted their proposals for the 2018-19 state budget, and financial wonks are still crunching the numbers to determine whether either plan would effectively fund school services at current levels. Both claim to do so.

What we do know is that in the House plan, Speaker Joe Straus (R-San Antonio) has proposed an additional $1.5 billion boost in education funding “contingent upon the passage of legislation that reduces recapture and improves equity in the school finance system.”

If legislators are serious about reducing local property taxes, this is where it starts. It’s simple math.

Back to the see-saw: The only way to achieve meaningful property tax relief is for the state to assume more responsibility for the share of school funding it has passed on to you through local property taxes. Any other proposals you hear – and you will hear plenty – are empty measures meant to delay your outrage over your property tax bill for another two years.

In a December 2016 column, The Texas Tribune’s executive editor Ross Ramsey concluded, “Had the state kept its share of school funding constant for the past 10 years, voters might not be griping about rising property taxes.”

Tired of griping? Then let’s get serious. By boosting state investment along with taking a real shot at reforming the school finance system, the House is on the right track. We’ll find out if the rest of the legislature is serious as well.

Houston throws down gauntlet on school finance reform

I lived in Houston for ten years.

It’s where I finished high school, graduated from college, and began my first career as a fuzzy-cheeked radio broadcaster. It’s where I gleefully watched my alma mater, the Houston Cougars, win a C-USA title, my beloved Astros make their World Series debut, and the Rockets come devastatingly close to a championship season after season. It’s a fantastically diverse and dynamic city; yet to many Houstonians, it seems that no matter what Houston does, few outside its boundaries ever seem to notice.

Now a vote on a relatively obscure proposition on Tuesday’s ballot has arrested the attention of many lawmakers in Austin.

ThinkstockPhotos-481431733On Tuesday, Houston voters decided not to authorize the city’s first recapture payment of $162 billion, part of a roughly $1 billion obligation over the next four years. Under the state’s school finance equalization formula, referred to as “Robin Hood” by some, school districts that are considered “property-wealthy” must return some of the money collected from their local property taxes to the state, which in turn delivers that money to poor districts that lack the tax base necessary to support healthy schools. Ironically, some of those property-wealthy districts still enroll high numbers of students from families living in poverty. Houston ISD officials argue that instead of sending away the funds, their district needs that money instead to educate a high proportion of low-income students in their own district.

It’s a predicament endured for years by Austin ISD, another property-wealthy district that serves a high proportion of economically disadvantaged children, yet is expected to pay more than $400 million in recapture this year. The number of Texas districts paying recapture stands at 250 and rising, and it is a major reason many districts are lobbying the 85th Texas Legislature to reform the school finance system when it convenes in January.

But things are complicated.ThinkstockPhotos-185034697_gavelcash

In response to a lawsuit filed by more than 600 school districts, the Texas Supreme Court in May ruled that the state’s school finance system met the minimum requirements under the Texas Constitution. While the final opinion from Justice Don Willett urged lawmakers to fix a “Byzantine” and “undeniably imperfect” system, it removed the threat of a court mandate to do so.

Houston’s new Mayor Sylvester Turner is no stranger to the Texas Legislature. The long-time state representative and former vice-chair of the powerful House Appropriations Committee spearheaded a campaign urging Houston voters living within HISD boundaries to reject authorization of the recapture payment this election and force a standoff — gambling that state legislators will be spurred into action by voters and constituents in Texas’s largest school district publicly rejecting the state’s school finance system.

It’s a big gambit.

After Houston voters on Tuesday declined to authorize the recapture payment, Commissioner of Education Mike Morath notified HISD trustees early Wednesday that under the law, $18.2 billion in taxable property needed to meet the recapture amount will be detached from the district and annexed to one or more property-poor districts.

So will the ruckus raised in Houston Tuesday ring in the ears of important folks beyond Space City’s orbit?

Falling US MoneyThe question of whether the move will increase pressure on lawmakers to initiate a long and complicated school finance overhaul is a big unknown. The recapture amount owed by Houston is dwarfed by Austin’s, yet lawmakers have thus far been unmoved by AISD’s many pleas for change. While some House leaders have expressed interest in reform, a requested four percent across-the-board reduction in state agency spending will complicate things significantly.

ATPE has long advocated for meaningful school finance reforms to make the system more responsive to our students’ needs, as illustrated by our member-adopted legislative program, which includes the following:

ATPE supports a public education funding system that is equitable and adequate to provide every student an equal opportunity to receive an exemplary public education. ATPE also supports any form of state revenue enhancement and tax restructuring that accomplishes this goal, empowers the state to be the primary source of funding, and creates a more stable funding structure for our schools. We strongly support efforts to increase funding levels to meet the needs of a rapidly growing and changing population and to increase funding equity for all students.

Ultimately, school finance reform could come by degrees, and meaningful progress could be made this session. I expect calls for legislation to update the decades-old Cost of Education Index (COI) and the similarly vintage transportation allotment, as well as a bill by state Rep. Donna Howard (D-Austin) that would amend the Texas Constitution to require the state to shoulder at least half the cost of public education. We’ll be keeping an eye out for you. Stay tuned to Teach the Vote and ATPE.org for updates.