Tag Archives: Paul Bettencourt

Senate Education Committee takes up school finance bills

After a long wait and repeated delays, the Senate Education Committee is hearing school finance reform legislation today, Thursday, April 25. Chairman Larry Taylor (R-Friendswood) laid out committee substitutes for the Senate’s school finance bill, Senate Bill (SB) 4, and the school finance finance bill passed by the House, House Bill (HB) 3 this morning. The Senate’s proposed substitute language is the same for each bill, and the committee is hearing testimony on both simultaneously.

Below are highlights of some of the main points of the Senate’s version of HB 3/SB 4:

EDUCATION

  • Would expand free pre-K eligibility to teachers’ children.
  • Would grant full-time teachers and librarians a $5,000 pay raise for the 2019-20 school year, and create an allotment to provide related funding to school districts for salaries of teachers and librarians.
  • Would institute a merit pay program by creating recognized, exemplary, and master teacher designations. The program would require districts to adopt new teacher evaluation criteria to be approved by the commissioner of education for purposes of ranking all teachers and determining which ones might qualify for additional incentive pay. The bill states that districts and the commissioner may not rely “solely” on students’ standardized test results in making those determinations. However, ATPE believes that criteria for the distinctions and awards would still be based largely upon STAAR test results in order to facilitate statewide comparisons of teachers. School districts would be required to share all their teachers’ evaluations with the Texas Education Agency.
  • Would create outcomes-based funding by which districts may receive additional funding based upon third grade reading STAAR test results and college, career, or military readiness indicators. This could increase the high-stakes emphasis on student testing and adversely affect funding for struggling schools that are in the greatest need of additional resources.
  • Would call for a study of education cost drivers and geographic differences in education costs.
  • Would create early reading funding for grades K-3 or full-day pre-K.
  • Would create additional funding for dyslexia, dual language, and blended learning programs.
  • Would require that high school students complete a free application for federal student aid (FAFSA) in order to graduate.
  • Would break the STAAR test into smaller tests and prohibit testing on a Monday.
  • Would create a campus turnaround plan as proposed in SB 1412, which includes incentive pay. Under this plan, teachers would be incentivized to work at campuses with higher needs, although there would likely be a student testing component. The plan also requires contracting with a third-party vendor.

SCHOOL FUNDING

  • Would increase the basic allotment to $5,880 from $5,140, but eliminates the adjusted basic alloment.
  • Would increase compensatory education funding and would fund based upon a spectrum that acknowledges students’ varying degrees of economic disadvantage.
  • Would switch to tax collections based on current year property values.
  • Would repeal certain formulas, such as the cost of education index (CEI) and high school allotment, and roll them into the basic allotment.
  • Would attempt to ensure that recapture does not reduce school district budgets.
  • Would base transportation funding on mileage, but without setting a minimum rate.
  • Would require charter schools to pay into the Teacher Retirement System (TRS).

PROPERTY TAX

  • Would increase the homestead exemption by $15k to $40k contingent upon voter approval of a one cent sales tax increase, bringing the overall sales tax to the nation’s highest at 9.25 percent.

During this morning’s explanation of the bill and early testimony by Commissioner Mike Morath and other TEA staff, Sen. Paul Bettencourt (R-Houston) voiced “grave concerns” with the portion of the bill that makes property tax relief through an increase in the homestead exemption contingent upon Texas voters approving a sales tax increase. Sen. Bettencourt, who chairs the Senate Property Tax Relief Committee, argued that such a tax swap would not be neutral, and he suggested alternatives such as expanding the tax base to online sales.

SENATE VS. HOUSE

Senate Education Committee meeting April 25, 2019.

The version of the school finance bill discussed Thursday differs from the version of HB 3 that the House passed by a nearly unanimous vote. The new Senate version brings back outcomes-based funding and the merit pay provisions that ATPE  opposed and House members wisely stripped out of HB 3. The Senate version increases the basic allotment to $5,880 versus $6,030 in the House version. The Senate version of HB 3/SB 4 includes a $5,000 pay raise for teachers and librarians, but the Senate proposal currently includes no language to ensure that the educators receive those raises in future years (unlike SB 3 that the Senate passed earlier this session). The property tax relief proposed in the Senate school finance bill includes an increase to the homestead exemption that is contingent upon a sales tax swap, while the House version does not offer an increase to the homestead exemption.

Both the Senate and House versions include additional funding for dyslexia, dual language, and blended learning programs. Both would increase compensatory education funding and would fund based upon a spectrum that acknowledges varying degrees of economic disadvantage. Both versions would base transportation funding on mileage and repeal outdated formulas, such as the cost of education index (CEI) and high school allotment, and roll them into the basic allotment.

The Senate Education Committee will be hearing public testimony on the bill throughout the day. Chairman Taylor indicated that the committee most likely will vote on the bill later next week. Stay tuned to Teach the Vote and follow us on Twitter for updates as the school finance hearing continues today and additional witnesses provide testimony, including ATPE.

Teach the Vote’s Week in Review: Jan. 18, 2019

Here’s your weekly wrap-up of education news from ATPE Governmental Relations:


Both the Texas House and Senate released their preliminary budget proposals for the 2020-21 biennium this week. A key feature of each chamber’s plan was how much more funding had been proposed for public education, likely resulting from the uptick in educator engagement at the polls last year and in policy discussions over the interim.

The House proposal for public education funding includes a 17.2 percent increase from general revenue, while the Senate’s proposal would increase funding from general revenue by 10.3 percent. The Senate Finance Committee has already released a full schedule of upcoming budget hearings, including one on Feb. 11 to discuss the public education portion of the budget. Expect similar hearings to be scheduled in the House once Speaker Dennis Bonnen releases a list of House committee assignments, likely later this month.

On Tuesday, Sen. Jane Nelson (R-Flower Mound) filed Senate Bill 3 (SB 3) relating to additional funding to school districts for classroom teacher salaries. The low bill number indicates that this is a high priority bill in the upper chamber. In short, both the House and Senate are trying to signal to the public that they’ve received the message loud and clear from voters: it’s time to properly fund public education. But don’t count your chickens before they hatch, as it’s important to remember that a filed bill does not a law make.

Now is the time for educators and community members to continue to press their point so that House and Senate budget negotiations will proceed with a sharp focus on the needs of Texas public schools. To keep abreast of what’s happening at the legislature on the budget, teacher pay bills, and other pieces of legislation, and to contact your legislators directly, visit our Advocacy Central page for ATPE members only.

For more on the House and Senate budget proposals that have been filed, read this week’s blog post by ATPE Lobbyist Mark Wiggins. Also, check out last night’s episode of the Spectrum News program Capital Tonight featuring an interview with ATPE Senior Lobbyist Monty Exter discussing the proposals to increase public education funding this session.


The League of Women Voters (LWV) has created a survey designed to capture information about how Texas voters find information on voting and elections. LWV encourages users who take the 10-20 minute survey to think of it as a “scavenger hunt” where after being asked a few questions users will set out to hunt down information on the Texas Secretary of State’s website. More information about the scavenger hunt can be found here.


 Earlier today, Lt. Gov. Dan Patrick announced who would be chairing each of 16 Senate committees this session. Sen. Larry Taylor (R-Friendship) will remain the chair of the Senate Education committee. Meanwhile, Sen. Joan Huffman (R-Houston) will be chair of the Senate State Affairs committee while Sen. Paul Bettencourt (R-Harris County) will chair the new Senate Property Tax Committee.

For a full list of all Senate committee members and chairs, read this blog post from earlier today.


Online registration for ATPE at the Capitol will close Thursday, Jan. 24, and ATPE members won’t want to miss this opportunity to get up close and personal to the action at this year’s legislative session. Funding for public education along with calls for increased educator compensation have emerged as issues at the forefront of this session. Now more than ever we need educators to visit the legislature and advocate for their profession. ATPE at the Capitol will be held on Feb. 24-25, with political involvement training taking place on Sunday, Feb. 24, and visits with House and Senate members happening on Feb. 25.

There is no registration fee for ATPE members to attend ATPE at the Capitol, and ATPE also has funds available to assist some local units and individual members defray their travel costs for attending the event. Incentive funds will be awarded on a first-come, first-served basis upon a showing of demonstrated need and subject to certain eligibility criteria. The deadline to apply for travel incentives is also Jan. 24, 2019. Hotel rooms at the J.W. Marriott hotel, where the event will be held, are available for booking using the special link found on the event’s registration page. Hotel reservations must also be booked by Thursday’s deadline in order to take advantage of special discounted room rates.

We hope to see many ATPE members alongside our professional lobby team next month during ATPE at the Capitol!

 


 

School finance commission approves final recommendations

The Texas Commission on Public School Finance met Wednesday for the final time to unanimously approve the final recommendations and findings to be included in the commission’s final report due to the Texas Legislature by December 31.

School finance commission meeting December 19, 2018.

The commission was created by House Bill (HB) 21 during the special session of the 85th Texas Legislature in August of 2017 after school finance reforms and additional funding proposed by the House were rejected by the Senate. The commission was charged with examining the school finance system and recommending potential reforms.

Members were appointed in the fall of 2017, but the commission did not meet until January 2018. Members heard roughly 80 hours of testimony from more than 150 witnesses, including ATPE. Progress on the final report had been stalled awaiting the product of a working group on revenues led by state Sen. Paul Bettencourt (R-Houston).

The final report contains 34 separate recommendations, which members spent hours wordsmithing Wednesday. Chair Scott Brister, who was appointed by Gov. Greg Abbott, resisted wording that would have called for “adequate” school funding or described current funding levels as “inadequate.” The chair’s suggestions centered on insulating the state against any potential for future school finance litigation, while other members of the commission argued for more explicit and specific funding increases.

Changes to the final draft considered on Wednesday included a new section containing significant and previously undiscussed suggestions for the construction of local teacher evaluation systems for implementing the differentiated pay program proposed by the commission. The suggestions outline the required components of district plans, which include student achievement as determined by test scores, administrator observations, and student perception surveys. Furthermore, the suggestions included minimum percentages for each category, requiring test scores to account for a minimum of 25 percent of an educator’s overall evaluation rating.

ATPE successfully lobbied for the commission to remove the percentages from its final report in order to avoid starting the legislative conversation with artificially predetermined weights for each of the recommended components. Despite the language in the report labeling these components as mandatory, they will in actuality serve as the starting point for bills that will be drafted and debated when the 86th Texas Legislature convenes in January. The same goes for all of the recommendations contained within the commission’s report.

The full report is titled “Funding for Impact: Equitable Funding for Students Who Need It the Most” and can be found here. ATPE responded to the final report with a press statement, which recommends the following additional considerations in light of the report:

1. Current public education funding levels are inadequate to meet the state’s education goals
and the needs of our 5.4 million students enrolled in public schools in pre-kindergarten
through 12th grade. Texas remains among the bottom one-third of states in per-student funding
despite educating a disproportionate level of students who are economically disadvantaged
and/or English language learners, both of which require significantly more resources to educate.
There can be no real school finance reform that fails to address adequacy. ATPE is
disheartened that some members on the commission were unwilling to acknowledge the reality of
the limitations of our state’s current funding levels out of fears of sparking litigation.

2. ATPE rejects the implication that school districts do not efficiently allocate the money they
receive under the state’s current funding system. In 2015-16, school administration counted
for little more than three percent of district expenditures, while instruction and direct student
supports combined accounted for more than 70 percent. The state’s share of public education
funding also has fallen dramatically. A decade ago, there was a roughly even split between state
funding and local taxpayers; in 2021, it is projected that state funding will be as low as 32
percent.

3. Texas teachers should be paid a salary that acknowledges their excellence in the classroom and
contributes to statewide efforts at recruitment and retention of outstanding educators. Focusing
on initiatives that would provide a premium salary only for “top teachers,” as the commission has
suggested, would address compensation concerns only for an estimated two to five percent of
our state’s teachers. A large percentage of the remaining educators serving our state’s students
are doing so effectively and deserve additional compensation. In order to achieve the stated goal
of providing all Texas students with an effective teacher, ATPE recommends that the
legislature set a statewide goal of paying all effective teachers a salary that is suitably
competitive and commensurate with the work they are doing—in addition to rewarding the
top teachers in the field.

4. The commission has recommended an educator effectiveness allotment to help school districts
boost salaries of their most effective teachers with state funding that would commence in the
2019-20 school year. However, the final report also suggests new and prescriptive criteria that
school districts would be forced to meet in order to receive the allotment, which would amount to
a major restructuring of teacher evaluation systems without appropriate vetting or study.
Considering the years of research and piloting that have gone into previous design changes to
teacher evaluations in Texas, ATPE strongly cautions legislators against mandating any
rapid, wholesale changes to teacher evaluation laws based solely upon a four-page
excerpt in this school finance commission report that did not receive adequate vetting by
commissioners or stakeholders prior to its adoption.

“ATPE appreciates the long hours devoted by commission members to researching the complexities of school finance and listening to the many concerns by our association and other stakeholders,” said ATPE Executive Director Shannon Holmes.

In particular, ATPE members have expressed gratitude for those who stood up for Texas students during the commission’s deliberations by arguing for the inclusion of additional public education funding. State support for public education has been inadequate to fully overcome the growing list of challenges that Texas schools face. How to address these challenges became a key issue during the 2018 election cycle.

“Texas voters have sent a strong message,” said Holmes. “The state must do a better job funding our
schools, and Texans will no longer accept excuses for failing to act.”

ATPE looks forward to forging real solutions on school finance when the 86th Texas Legislature
convenes in 2019. The association pledges to continue working with legislators to implement policies that will benefit all 5.4 million Texas schoolchildren.

Teach the Vote’s Week in Review: Dec. 14, 2018

From school finance and retirement to school accountability ratings, here’s your weekly wrap-up of education news from the ATPE Governmental Relations department:


School finance commission meeting Dec. 11, 2018

The Texas Commission on Public School Finance met on Tuesday of this week to begin deliberating recommendations for the body’s final report due at the end of this month. Among the suggestions discussed Tuesday were (1) outcomes-based funding hinged upon early literacy and student preparedness for entrance into college, the military, or a career field without remediation; and (2) a high-quality teacher allotment that would require school districts to develop local, multi-measure assessments of their educators. Those assessments would need to comply with criteria outlined by the legislature.

While some members of the commission bristled this week at the idea of requesting more funding from the legislature, others, including House Public Education Committee Chairman Dan Huberty (R-Humble), stated that he would refuse to sign a report that did not request more funding. Sen. Paul Bettencourt (R-Houston), chair of the commission’s working group on revenues, suggested that the full commission adopt Gov. Abbott’s plan to cap property taxes at 2.5% annually. Meanwhile, Leo Lopez, Chief Finance Officer for the Texas Education Agency, pointed out during Tuesday’s hearing that the governor’s plan is more of a property tax relief plan than a school finance reform plan.

A more detailed breakdown of Tuesday’s meeting can be found in this week’s blog post from ATPE Lobbyist Mark Wiggins.

Other recommendations in the commission’s draft report, which can be previewed here, include prioritizing the state’s “60×30” goal, which is to have 60 percent of high school graduates eligible to enter the workforce with an industry certification, successfully join the military, or enter college without the need for remediation by the year 2030. More technical recommendations include reallocating $5.34 billion in existing revenues and revising the current weights and allotments in order to boost the basic allotment, which provides a baseline of funding for all 5.4 million school children in Texas. Throughout the commission’s year of deliberations, scores of education stakeholders and experts have shared their input, including invited testimony from ATPE back in February.

The commission will meet once more on Wednesday, Dec. 19, to vote on its final recommendations before submitting its report to the legislature as required on or before Dec. 31. Stay tuned to Teach the Vote for updates on the final vote.


The Teacher Retirement System of Texas (TRS) Board of Trustees met in Austin at the TRS headquarters on Thursday, Dec. 13, and Friday, Dec. 14, for its final meeting of 2018. Board committees met on Thursday. Each committee’s meeting materials can be found below. The full board met Friday morning to consider the following agenda. Video of the board committee meetings and the full board meeting is also available for viewing.

For additional information, view the following TRS board meeting materials:


Today the Teacher Retirement System of Texas (TRS) released an updated Pension Benefit Design Study. This recent study augments the body of knowledge generated by a 2012 study on the pension program for Texas educators. The updated study released today by TRS outlines benefits and statistics about the pension system, and includes such findings as these, which are in line with ATPE’s positions on TRS:

• A total of 96 percent of public school employees do not participate in Social Security. For many TRS members, the only source of lifetime income in retirement is their TRS benefit. A lifetime benefit helps mitigate the risk of a retiree who — due to longevity, market volatility or failure to invest adequately — outlives his or her savings.

• A majority of TRS members would end up more financially at-risk by investing on their own in a plan with a defined-contribution component.

• The TRS benefit, as currently designed, replaces roughly 69 percent of a career employee’s pre-retirement income when that person initially retires.

• Alternate plans would be 30 to 124 percent more expensive than the current defined benefit plan to provide the same benefit level upon an employee’s retirement.

More information about the study can be found in this TRS press release, along with a one-pager about the pension program. The full text of the new report can be accessed here.

Preserving the integrity and solvency of the TRS defined-benefit pension plan for educators is one of ATPE’s priorities for the 86th legislature.


The Texas Education Agency (TEA) has released its final academic accountability ratings for the 2018 year. The ratings include results for 1,200 school districts and charters and over 8,700 campuses within the state. While preliminary ratings were released in August, this final release includes the ratings of districts and charters that contested their initial ratings. More information about the accountability ratings can be found here. To search the ratings by district or campus, visit TXschools.org 

 


 

School finance commission discusses initial recommendations

School finance commission meeting Dec. 11, 2018.

The Texas Commission on Public School Finance met Tuesday in Austin to discuss recommendations for the commission’s report, which is due to the legislature by the end of the month. The initial draft recommendations can be viewed here, and additional resources can be found here.

The draft report includes a recommendation that the 86th Texas Legislature “inject significant additional annual state revenue” through new strategic allotments and weights outlined in the commission’s report, including about $1.7 billion in specific areas. The report adds that for the purposes of new funding, members should note that an increase of $500 million in state funding is equal to a roughly 0.9 percent increase over the last budget biennium. This would be formula funding, targeted at the neediest studies, and tied to specific outcomes.

Commission Chair Scott Brister voiced reservations, suggesting that asking the legislature for significant additional funding is not the commission’s job. He later clarified that his chief opposition was to placing a dollar figure on additional funding. Several members pushed back, including House Public Education Committee Chair Dan Huberty (R-Houston), who said he would not sign a report that does not call for additional school funding.

The report also calls for reallocating $5.34 billion in existing funds to more impactful spending and greater system-wide equity. The commission recommends significant investment to substantially increase third grade reading levels. Outcomes-based funding would be targeted toward early literacy and post-secondary access of career, military, or higher education without remediation.

The commission is recommending a high-quality teacher allotment, initially funded at $200 million, for districts wishing to offer differentiated compensation to pay their most effective educators higher salaries sooner in their career. This would be contingent on districts creating locally-developed, multi-measure evaluation and compensation systems based on an outline created by the legislature. This includes the state setting a goal that top teachers have a path to a $100,000 salary and incentivizing districts to assign top teachers to the most challenging campuses.

Finally, the draft report calls for statutorily increasing the basic allotment, though it does not specify a specific amount. It calls for increasing the yield on “copper pennies” and compressing the rate in order to provide tax relief, as well as reducing the role of recapture in the school finance system. The report makes no recommendations regarding special education, instead suggesting that the current corrective action plan approved by the U.S. Department of Education should be completed before any additional reforms are discussed.

Discussing the commission’s major findings, Brister acknowledged that schools are being asked to do more than ever before. This includes higher security standards and providing for the physical and mental well-being of students in addition to educating them. He then asked to strike language from the report that says the state has failed to adequately fund public education.

After breaking for lunch, the commission returned for more in-depth discussion on individual recommendations. Commission member Todd Williams of the Commit Partnership in Dallas pointed out that the teacher compensation portion of the plan (Section D) does not include specific funding for strategic staffing such as that implemented by the Dallas ISD ACE program, which is intended to incentivize top teachers to teach at the highest-need campuses. Williams argued the evaluation system and strategic staffing system should be treated as separate and funded accordingly.

State Sen. Paul Bettencourt (R-Houston) then laid out the recommendations from the working group he chaired on revenues. The group’s primary recommendation is to adopt Gov. Greg Abbott’s plan to cap local property tax revenue growth. The plan suggests capping growth at 2.5 percent annually, and replacing revenue lost by school districts with state funding. The governor’s office does not specify how much this would cost or from where the replacement funding would come.

Texas Education Agency (TEA) Chief School Finance Officer Leo Lopez presented a chart addressing the three plans endorsed by Bettencourt’s group, which suggests that the governor’s plan would reduce local maintenance and operations (M&O) tax collections by nearly $1 billion and increase school district revenue by $300 million in 2020 at a cost of roughly $1.3 billion. By 2023, the governor’s plan is projected to reduce M&O tax collection by $3.7 billion while increasing school district revenues by $74 million. Lopez pointed out that this is primarily a tax relief plan, as opposed to a school finance plan, which explains why future funding is projected to flatten out.

The commission discussed the level of emphasis that should be placed upon the governor’s revenue cap plan. Members pointed out the interrelation of property taxes and school finance, as well as the need to focus on the commission’s statutory charge, which is to fix the school finance system. The governor’s plan alone would not change the fundamental mechanics of the school finance system.

Sen. Bettencourt has argued that the state’s coffers will be flush heading into the next budget cycle based on tax revenue from booming oil and gas production, but the state comptroller has yet to release a formal biennial revenue estimate (BRE) with hard numbers upon which to base a budget. State Rep. Ken King (R-Canadian), who represents oil and gas-dependent west Texas, cautioned against relying on oil and gas as a reliable, long-term funding source. A combination of the governor’s plan and the commission’s recommendations for additional public education spending could add up to a price tag north of $5 billion for the upcoming budget biennium.

The commission is scheduled to meet next Wednesday, Dec. 19, 2018, to vote on final recommendations. The commission is required by law to submit its report to the legislature by December 31.

Finance commission group finalizes recommendations

The Texas Commission on Public School Finance working group on revenue met Tuesday at the Texas Capitol to discuss recommendations to deliver to the full commission. State Sen. Paul Bettencourt (R-Houston), who leads the working group, indicated he is open to using the economic stabilization fund (ESF), which is commonly referred to as the “Rainy Day Fund,” to help fund public education.

School finance commission working group meeting November 27, 2018.

Bettencourt opened the meeting suggesting that state revenues are looking bullish heading into the next budget biennium. Again, Sen. Bettencourt emphasized his priority is phasing out the “Robin Hood” system of wealth equalization through recapture. According to Bettencourt, freezing recapture would cost approximately $2.3 billion.

Before Bettencourt began his presentation, commission member and Austin ISD Chief Financial Officer Nicole Conley Johnson told the group she had identified $14 billion in new programs to propose to the commission.

According to figures Bettencourt provided to the group, the state comptroller increased the revenue estimate for the next biennium to $110.2 billion in July 2018 from $104.9 billion in 2017, a $5.3 billion increase. During the first two months of fiscal year (FY) 2019, sales tax revenues, which represent 58 percent of all state tax collections, are expected to be up ten percent compared to FY 2018.

Bettencourt asserted two point upon which most agree: Without school finance reform, the state’s share of public education funding will continue to shrink, and the amount of funding districts pay into recapture for wealth equalization will continue to increase. Bettencourt emphasized his prediction that increased revenue in FY 2019 will provide additional general revenue (GR) which will be available to help fund schools.

State Rep. Diego Bernal (D-San Antonio), who is vice-chair of the House Public Education Committee, raised a question over how equity would be preserved if legislators make changes to or eliminate the recapture system. State Rep. Ken King (R-Canadian), who is also a member of the House Public Education Committee, also raised a concern that any increase in school funding will need to be sustainable.

Bettencourt presented the governor’s tax cap plan as the solution. The plan would increase funding for districts that increase teacher pay and improve student outcomes, however Rep. Bernal noted that outcomes-based funding threatens to reward districts that already have the resources necessary to improve while neglecting districts that have failed to improve precisely because they lack the necessary resources. The plan would also limit property tax revenue growth to 2.5 percent per year, which the plan promises to make up for with state funding.

Another proposal discussed by Bettencourt is one presented by the Texas Public Policy Foundation (TPPF), a far-right pro-voucher organization, which would aim to eliminate all school district maintenance and operations (M&O) property taxes. This would cost roughly $51.3 billion for the 2018-19 biennium. The TPPF proposal claims to be able to pay for itself by dedicating future increases in state revenues to public education, but Bettencourt conceded that this is an optimistic view.

Bettencourt also briefly discussed the idea of “sharing” recapture. In this plan, property value growth would be divided by thirds, and the benefits from the growth in property values would ostensibly be shared. Additionally, Bettencourt suggested using the increase in production severance taxes – largely due to oil and gas activity in the Permian Basin – to help fund public education. This funding stream currently already flows to public education and general revenue, with an overflow stream that is bifurcated between highway funding and the ESF. Despite the Senate’s opposition to spending ESF dollars in previous legislative sessions, Bettencourt indicated he’s now open to spending ESF money to help fund public education. Johnson argued that this represents a redirection of existing revenues and does not represent the new revenue necessary to improve school performance.

The working group voted to advance each of the proposals except the plan offered by TPPF to be considered by the full commission. Rep. King made the motion to table the TPPF plan, which he declared nonsensical. Several members expressed similar concerns. Closing the meeting, commission chair Scott Brister suggested that legislators should feel less constrained by court rulings enforcing equity. As a justice, Brister was a dissenting voice in the West Orange-Cove school finance ruling.

The full commission will meet Friday, again on December 5, and at least once more during the third week of December. The commission will get a chance to react to Tuesday’s recommendations and will arrive at a decision by the December 5 meeting on what the final report should look like. The following meeting will focus on what the report should say. The commission is required to submit its report to the legislature by December 31.

Brister asked commission members to do their best to reach a unanimous consensus on recommendations, and said that in lieu of a minority report, individual members will be allowed to place letters in an appendix to the final report.

 

Finance commission group meets to discuss revenues

The Texas Commission on Public School Finance working group on revenues, led by state Sen. Paul Bettencourt (R-Houston), met Tuesday at the Texas Capitol to hear testimony. Sen. Bettencourt began the meeting by stating the state must “wean” itself off of the “Robin Hood” system of wealth equalization through recapture.

School finance commission working group on revenues meeting November 13, 2018.

Bettencourt set a target date of November 27 for a vote on recommendations and anticipated sharing those recommendations with the full commission in December. The commission’s report is due to the legislature by the end of December.

Austin ISD Chief Financial Officer Nicole Conley Johnson followed up Bettencourt’s remarks by stating a separate goal of identifying $6 billion in additional funding for public schools. Johnson and Bettencourt have stood on opposite sides of most school funding discussions.

Dale Craymer, president of the Texas Taxpayers and Research Association (TTARA), was the first witness invited to testify. Craymer testified that the recapture system is likely required based upon school finance court rulings, and noted that reducing recapture and reducing property taxes are not one in the same. Craymer suggested property taxpayers could be provided relief by using value growth to reduce the compression percentage downward, yet offered no direction with regard to relief for schools. Craymer suggested legislators must first determine what outcomes are desired before determine how much funding is needed.

Chandra Villanueva with the Center for Public Policy Priorities testified that recapture is necessary to level the playing field between school districts with vastly unequal property wealth. Instead, Villanueva testified that the overall system has failed and suffers from underfunding. Villanueva suggested instead updating the costs of education, adjusting for inflation, and slowing the growth of charter schools, which are pushing some districts into recapture.

Scott Brister, who chairs the commission, challenged the notion of inadequate funding. Villanueva responded that adequacy targets are an appropriate goal, and waiting to invest more resources only deepens the deficit lawmakers must eventually address. Johnson launched into an impassioned explanation of the fiscal challenges facing schools, which have seen funding decline while being asked to do more.

Vance Ginn with the Texas Public Policy Foundation (TPPF), a think tank funded by supporters of school privatization, offered a number of discredited claims regarding school funding, and argued for eliminating school district property taxes in favor of reduced state funding.

David Thompson testified that the shift from the state toward local property taxpayers is being driven by value growth, and urged legislators should commit at least a portion of value growth to increasing the basic allotment every session. Thompson also recommended closing a number of tax loopholes, such as for online retailers, and increasing the gas tax.

Speaking on behalf of Gov. Greg Abbott, former state Sen. Tommy Williams testified that the state should pay teachers more and reduce the burden of property taxes, which will require additional state funding. Notwithstanding this, Williams said funding should not be increased without accompaniment by school finance reform. The governor’s plan contains three essential elements: Rebalancing the state share of funding, paired with compression of local school property taxes rates; slowing the growth of local property tax bills; and treating all students equally, based on individual student needs as opposed to school district property values, which will require reducing the growth of recapture.

Williams then proceeded to outline the governor’s plan, which can be found here. In it, the governor’s office suggests capping school district Tier 1 maintenance and operations (M&O) tax revenue growth at 2.5 percent and replacing the lost funding with state dollars. The plan does not specify a funding mechanism or source. The plan also proposes outcome-based bonuses, awarding charter school attendance credits, and paying stipends to teachers who teach in more difficult classrooms, along the lines of Dallas ISD’s ACE program. This marked the first time the plan has been presented in public.

Asked by Sen. Bettencourt what the governor’s idea of additional state aid looks like, Williams suggested he would rather lawmakers not “back into that number” from available revenue, but rather to try and put a price tag on the recommendations from the commission’s working group on expenditures. Johnson followed up with a question regarding how much it would cost to buy down the tax rates as suggested by the governor. Williams did not offer an estimate.

In last-minute meeting, revenue working group gets orders

The Texas Commission on Public School Finance working group on revenues met briefly Tuesday evening after the commission’s formal meeting adjourned. Unlike the other two working groups, the revenues group led by state Sen. Paul Bettencourt (R-Houston) did not post a public notice following Texas open meetings guidelines.

Texas’s open meetings law was passed to limit secret government meetings and ensure the public has access to deliberations of public interest. The law explicitly applies to the school finance commission as a whole, however its application to working groups of the commission is less clear. The only notice was posted the day of the meeting in an obscure portion of the Texas Education Agency (TEA) website. Because notice was not provided according to guidelines laid out by the open meetings law, few people attended the revenues meeting and no audio or video of the meeting is available.

According to those inside the meeting, Sen. Bettencourt stated the working group will aim to score various spending and revenue proposals, including raising the state sales tax or gas tax, enacting the performance pay program proposed by TEA Commissioner Mike Morath, limiting recapture, extending the Universal Service Fund (USF) tax on land telephone lines to cell phones, and the 2.5 percent tax cap proposed by Gov. Greg Abbott during the special session. Bettencourt requested members submit their ideas for study topics before the full commission meets again July 10.

A snapshot of the proceedings was posted on social media:

From The Texas Tribune: Will Texas school finance panel tell schools to do more with less? Some members think it’s predetermined

By Aliyya Swaby, The Texas Tribune
March 16, 2018

Justice Scott Brister, chairman of the Commission on Public School Finance, listens to a commission member at the panel’s second meeting Feb. 8, 2018. Photo by Bob Daemmrich for The Texas Tribune.

A state panel responsible for proposing improvements to Texas’ embattled public school finance system is facing criticism from an unexpected source: some of its own members, who say the panel’s hearings seem geared toward a predetermined outcome of making schools do more with their current funding.

Texas school districts have repeatedly sued the state over the past few decades, arguing it hasn’t provided enough money to ensure public school students an adequate education. During the 2017 session, lawmakers failed to make immediate changes to how the state allocates money to public schools — and instead agreed to create a 13-member commission to undertake a longer-term study.

That panel, which includes appointees from House Speaker Joe Straus, Lt. Gov. Dan Patrick, Gov. Greg Abbott and the State Board of Education, has held four hearings since it was assembled in January. Its next hearing is scheduled for Monday.

In those hearings, some commission members argue, presentations by experts have been skewed toward making the case that schools do not necessarily need more money to produce better outcomes for students.

“There’s a steady stream of presenters … trying to convince us that there’s enough money in the system and that adding more will not show results — that districts are essentially spending the money incorrectly,” said State Rep. Diego Bernal, D-San Antonio, one of four members appointed by Straus.

He said the commission has also heard from school leaders with innovative ideas, such as how to keep the best teachers at the most challenging schools and how to use full-day pre-K to get students at an academic baseline early in life.

“Those two things without question cannot be funded or sustained with the current funding levels we have,” Bernal said. “Even the districts that piloted it said they were about to run out of money.”

But the panel’s chair, Scott Brister, disagreed that the hearings were staged for any predetermined outcomes. He said the Texas Education Agency’s staff has worked to bring experts who can provide a framework for how school finance works and what an adequate education looks like.

“You’ve got to figure out what you would like the schools to look like before you figure out whether you need more money or less money or where that money’s going to come from,” said Brister, a former state Supreme Court justice. Appointed to the commission by Abbott, Brister was the sole justice to dissent in a 2005 lawsuit brought by school districts claiming the school finance system was inadequate and inefficient. The court ruled in favor of the districts and forced lawmakers to overhaul the funding system.

“I’m not interested in spending more money and getting no change. What’s the point of that?” Brister said this week. “The Constitution requires school districts to be free and efficient. … Surely it means you don’t waste money on stuff that doesn’t work and doesn’t make a difference. That’s one of our constitutional standards. We have to consider it.”

Over the past decade, the state has decreased its share of public education funding, allowing rising local property taxes to make up the difference. Currently, less than 40 percent of school funding comes from the state, while local property taxes pay for more than half. In 2011, lawmakers cut more than $5 billion from schools to close a budget deficit and never completely restored the money.

Texans will have their first, and potentially only, chance on Monday to publicly address the commission. Texas school leaders and public education advocates are expected to spend several hours, if not the whole day, testifying that they want the state to invest more money in public schools, instead of relying on local property tax revenue, and that they cannot educate students on the budget they have.

“Only after you get past that question [of adequate funding] do you get to talk about how to spend that funding,” said Monty Exter, a lobbyist at the Association of Texas Professional Educators, who plans to testify Monday. Exter said he sees three different groups on the commission: one that wants to increase funding to public schools, another that believes public schools are important but that increasing funding isn’t feasible, and a third that wants to defund public schools.

“My argument is that you haven’t funded us enough to get better outcomes,” said Nicole Conley Johnson, a member of the commission and chief financial officer of Austin ISD.

According to the TEA, Austin’s school district is expected to pay the state $545 million this school year to help subsidize poorer school districts, through a function of the school finance system nicknamed “Robin Hood.” Austin ISD has the highest Robin Hood payment in the state and has gone through several rounds of budget cuts over the last few years.

Johnson, who was appointed to the commission by Straus, agreed that the commission hearings seem to be skewed toward efficiency: “They want more for the same amount of resources.”

During the inaugural commission hearing in January, former Texas Supreme Court Justice Craig Enoch showed members a chart of 2011 student state test scores for school districts mapped against the amount of money those districts spent.

“There is a pattern here, but the pattern is not based on how much money is available,” he said. “In fact, the school district that performs the best is the school district that gets $2,000 less per student than the average funding.”

He suggested the state look into why certain school districts do better with less funding, and why others do worse with more. “Scholars and education experts are divided on the extent to which there is a demonstrable correlation between educational expenditures and the quality of education. The thing that matters is student outcomes,” based on test scores or high school graduation rates, he said.

Johnson and fellow commission member Doug Killian, the superintendent of Pflugerville ISD, pushed back on Enoch’s chart, pointing out the data was outdated and not comprehensive.

Chandra Villanueva, policy analyst at the left-leaning Center for Public Policy Priorities, said the commission should be trying to ask what schools need to educate students, instead of asking what they can do with existing resources. “Let the Legislature decide if they want to raise taxes or shift other priorities in the budget,” she said. “I don’t think the [commission] should prematurely tie their hands.”

The commission will split into three subcommittees to brainstorm recommendations to the Legislature at the end of the year on where the state should get revenue to fund public schools, how it should overhaul existing formulas to allocate funding more equitably, and what it should expect its public school students to achieve. Each subcommittee will get to decide whether and how to include the public in its discussions, according to Brister.

Sen. Paul Bettencourt, a Houston Republican chairing the panel’s revenue subcommittee, said it’s too early to say what those recommendations will look like.

“We’ve been drinking from the fire hose on public policy. I haven’t had any discussions with anybody yet to step back and get out of the line of fire and see where we are now. For me personally, I’m still in listening mode,” he said.

Disclosure: The Association of Texas Professional Educators and the Center for Public Policy Priorities have been financial supporters of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune’s journalism. Find a complete list of them here.

This article originally appeared in The Texas Tribune at https://www.texastribune.org/2018/03/16/school-finance-efficiency/.

 

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Why March 6 Matters: Retirement

Early voting is underway NOW for the March 6 Texas primary elections, so we’re taking a look at some of the reasons why it’s so important that educators vote in this election! Today, we’re taking a closer look at your retirement.


Everyone who decides to become an educator enters into a special agreement with the State of Texas. It goes something like this: If you devote your life to preparing our children for the future, Texas promises to be there for you when you retire at the end of a long career of service.

Only that promise is constantly under attack.

Let’s start with some basics. Your retirement is administered by the Teacher Retirement System of Texas (TRS), which oversees the pension trust fund. The state and individual educators each contribute to the fund, and a team of professional staff supervise a diverse investment portfolio that makes up the body of the fund. These full-time agency employees ensure the fund’s health and safety. After paying for the cost of administration and benefits, the money from those investments is plowed right back into the fund.

TRS is structured as a “defined benefit” retirement plan, which means that an individual who pays into the plan is guaranteed a set amount of money each month in retirement that will last for the rest of his or her life. The more common type of retirement plan is a “defined contribution” plan, such as a 401(k). Unlike the promise of a stable monthly pension check upon retirement offered by a defined benefit plan, a defined contribution plan promises merely a set contribution into an employee’s retirement account while the individual is actively working. Investment returns on that account are subject to the whims of the market. The level of retirement that can be provided by those funds at the end of an educator’s career is not guaranteed. Under a defined contribution scenario, there is a real threat that a retired educator may outlive the retirement funds accumulated during his or her career, and end up with nowhere to turn for help — not even Social Security.

You may have noticed that most businesses in the private sector have gone the defined contribution route. The reason is largely because 401(k) plans are cheaper and don’t require dedicated staff to administer. Most are run for a profit by large Wall Street corporations, and advisers often have a financial stake in the investments they recommend. This leaves plenty of opportunities for others to make money, but little guarantee of stable retirement income for the retiree. The defined benefit plan administered by TRS is, by contrast, of great value to retirees, who can rest easier knowing that they will receive a guaranteed income for as long as they are alive.

As with most big pots of public money, the TRS pension fund has unfortunately become the focus of those looking to brag about shrinking government while making a few bucks for their friends.

In 2017, the Texas Senate confirmed Josh McGee as chairman of the Texas Pension Review Board (PRB), which oversees state pension systems including TRS. Prior to being appointed to that position by Gov. Greg Abbott, McGee worked as a professional advocate for converting public pensions to defined contribution plans that would reduce the money guaranteed to retirees, and his position at the helm of PRB naturally raised alarm bells.

Adding to the concern, lawmakers have filed a number of bills in 2017 and in prior legislative sessions that would likewise weaken TRS. State Sen. Paul Bettencourt (R-Houston) – who made headlines recently with his objections to efforts to improve voter turnout among educators – filed a pair of bills last year aimed at converting TRS from a defined benefit plan to a defined contribution plan or a hybrid of the two. Both bills died without a hearing, fortunately, but Lt. Gov. Dan Patrick is keeping the idea alive as part of his interim charges for the Texas Senate to study before the legislature reconvenes in 2019.

Most troubling is recent news from the TRS Board of Trustees that it intends to vote to lower the assumed rate of return for the $147 billion pension fund from 8.0 percent down to 7.25 percent. The decision was based on observations of current market forces, and while fiscally prudent, it radically changes the plan’s outlook on paper. Like all pension plans, the TRS fund must be considered solvent before the legislature or board can consider any potential increases in benefits. With the lower assumed rate of return, TRS will head into the 2019 legislative session needing an additional $1.5 billion for future solvency, and they’ll be asking for that money from lawmakers who frequently are looking to cut spending, not increase it.

Politicians like Sen. Bettencourt frame their attacks on educators’ pensions by claiming the defined benefit structure is too expensive for the state to maintain into the future. In fact, the state’s share of an educator’s pension (at 6.8 percent) is less than half the teacher retirement contribution rate set by the next lowest state that is not paying into Social Security. The truth is that a more conservative assumed rate of return, coupled with a proper contribution rate, will guarantee TRS stays healthy well into the future.

The bottom line: Like public education as a whole, Texas gets a phenomenal bargain for what it spends, but more funding is necessary to fully realize the implicit promise made to educators.

Lawmakers will face tremendous pressure in 2019 from investors and politicians who want to gamble with teachers’ retirement. Unless Texans elect more pro-public education lawmakers and statewide elected officials, the legislature may very well look to your pension as an area to further cut corners. Texas will only keep its promise to educators if lawmakers respect educators’ voices at the polls in this pivotal election year.


Go to the CANDIDATES section of our Teach the Vote website to find out where officeholders and candidates in your area stand on educators’ retirement and other public education issues. Because voting districts in Texas are politically gerrymandered, most elections are decided in the party primary instead of the November general election. That’s why it is so important to vote in the primary election taking place now. Registered voters can cast their ballot in either the Republican or Democratic primary, regardless of how you voted last time.

Early voting in the 2018 primaries runs Tuesday, Feb. 20, through Friday, March 2. Election day is March 6, but there’s no reason to wait. Get out there and use your educator voice by casting your vote TODAY!