Tag Archives: taxes

Major Texas education groups agree on charter school policy agenda

This month, 15 major education groups in Texas agreed on a policy agenda for charter schools.

The groups include the Association of Texas Professional Educators (ATPE), the Texas State Teachers Association, the Texas Association of School Administrators, the Texas Classroom Teachers Association, the Texas American Federation of Teachers, the Texas Association of School Boards, the Texas Elementary Principals and Supervisors Association, the Coalition for Education Funding, Pastors for Texas Children, Raise Your Hand Texas, the Fast Growth School Coalition, the Texas Association of Community Schools, the Texas Association of Midsize Schools, the Texas School Alliance, and the Intercultural Development and Research Association.

In Texas, 5.5% of students attend charter schools yet they receive 10% of state funding for education. Because charters cannot levy taxes, charter schools are 100% funded by the state. Each charter school student generates the sum of the statewide average adjusted allotment (basic allotment adjusted using various weights for special populations and circumstances) and the statewide average property tax revenue across school districts. Last session, charters gained access for the first time to $60 million in facilities funding, or about $200 per student.

While charters are subject to the same accountability as traditional school districts, there are many differences in how charters operate. Texas law allows charters to accept and expel students based on academics and discipline, to employ non-certified teachers, and to choose whether or not to employ any counselors or school nurses. Additionally, the majority of charter expansion is under the charter amendment process, which allows for uninhibited growth of charter schools.

The joint policy agenda of the groups listed above focuses on increasing the transparency and efficiency of charter schools through seven recommendations for lawmakers:

  1. Allow for public transparency and input before any new charter amendments are approved in a certain community.
  2. The Texas Education Agency (TEA) should consider creating a standard charter application process and maintain an accurate charter school wait list to correctly document the number of unique students desiring charter admission.
  3. Charters should not be able to admit and expel students based on academics and discipline, as this creates inequality between charters and traditional school districts despite the fact that both receive public funds and are expected to educate all students.
  4. The Commissioner of Education should adopt procedures to analyze and report on the expected fiscal, academic, and program impact of each new charter school in order to maintain efficiency of the entire public school system.
  5. Since charters receive nearly $3 billion in public funds each year, they should publicly disclose their financial dealings, including leases, mortgages, contracts, and bond debt.
  6. Parents need to make informed decisions about where to enroll their children and should therefore have access to information on each charter school’s website such as student rates of expulsion, teacher certification and attrition rates, and the percentage of special education students.
  7. Charters received an estimated $882 million more than the school districts in which they reside during the last biennium. It is important to equalize this funding and require charters to pay into the Teacher Retirement System (TRS) just as districts do in order to create parity.

Comptroller announces $119.12B available for legislators to spend

Texas Comptroller Glenn Hegar announced Monday that the 86th Texas Legislature is forecast to have $119.12 billion available for general-purpose spending when the regular session begins tomorrow, Jan. 8, 2019.

Click the image to view a larger version. Credit: Office of Texas Comptroller Glenn Hegar

The announcement came today as part of the comptroller’s biennial revenue estimate, which is delivered to legislators before each session begins and consists of a forecast of how much revenue the state expects to receive and how much of it can be spent.

The state is projected to take in $107.32 billion in general revenue-related tax collections in the 2020-2021 fiscal biennium, which is up from $99.27 billion collected in 2018-2019. The next biennium begins with a balance of $4.18 billion carried over from 2018-2019, along with $14.16 billion in additional general revenue-related collections. A total of $6.34 billion of available revenue is reserved for transfers to the economic stabilization fund (ESF), also known more commonly as the state’s “rainy day fund,” as well as highway funds.

Legislators began 2017 with a $104.9 billion BRE, and the 85th Texas Legislature ultimately passed a $107.2 billion budget. The 2018-2019 revenue estimate was revised upward several times as economic conditions improved. In the 2020-2021 revenue estimate, Hegar noted increased economic growth in 2018 fueled by oil production in the Permian Basin, but urged caution looking beyond the 2019 horizon.

“Looking ahead to the 2020-21 biennium, we remain cautiously optimistic but recognize we are unlikely to see continued revenue growth at the unusually strong rates we have seen in recent months,” Hegar wrote in the official report. “Oil prices have dropped sharply since October, financial markets have demonstrated increased volatility, interest rates have been rising and U.S. trade policy remains uncertain. As the nation’s leading export state, the Texas economy in particular is exposed to potential reductions in international trade.”

“Because of this heightened uncertainty, this revenue estimate is based on a projection of continued but slowing expansion of the Texas economy,” Hegar concluded.

Much of the $119.12 billion legislators will be have for budgeting the next two years is already spoken for. The Center for Public Policy Priorities (CPPP) correctly points out in its BRE analysis that legislators will have to immediately make a $563 million back payment to Medicaid, funding that was deferred last session in order to fund public education.

CPPP predicts it will cost roughly $112 million for the state to maintain the current level of services, based upon factors including inflation and school enrollment growth. Legislators will also have to decide where to find $2.7 billion of supplemental funding for Hurricane Harvey recovery costs. That could come out of general revenue or the rainy day fund.

You can read the comptroller’s full report here.

From The Texas Tribune: Texas school finance panel approves final report to lawmakers

By Aliyya Swaby, The Texas Tribune
Dec. 19, 2018

Texas Commission on Public School Finance member Todd Williams of Dallas, left, speaks with Texas Education Agency Commissioner Mike Morath and state Sen. Royce West, D-Dallas, on Jan. 23, 2018. | Photo by Bob Daemmrich for the Texas Tribune

Texas school finance panel approves final report to lawmakers” was first published by The Texas Tribune, a nonprofit, nonpartisan media organization that informs Texans — and engages with them — about public policy, politics, government and statewide issues.

After hours of discussion Wednesday, a state panel studying school finance stripped its final report of language that blamed the state for inadequate education spending — and that added urgency to a need for more money to improve student performance.

The original version of the report, unveiled last Tuesday, included stronger language that held the state accountable for the lack of education funding and urged lawmakers to immediately inject more than a billion dollars of new funding into public schools. Scott Brister, the panel’s chairman and a former Texas Supreme Court justice, led the charge to make those changes, which he said would be more palatable to lawmakers and keep Texas from being sued in the future.

“I do have a problem several places where it says our school system has failed. I do think that’s asking for trouble,” he said.

Some lawmakers and educators on the panel pushed back before agreeing to compromise.

“I think we have failed our schools and we haven’t funded them, in my view, adequately or equitably,” responded state Rep. Dan Huberty, R-Houston, who chairs the House Public Education Committee.

Despite the conflict, the 13-member commission unanimously approved more than 30 recommendations on Wednesday aimed at boosting public education funding, improving student performance, cleaning up a messy funding distribution system — and providing property tax relief for Texans.

A final report will be sent to lawmakers, who are convening next month amid calls from state leadership to overhaul a long-embattled school finance system. Gov. Greg Abbott supported the panel’s vote in a statement Wednesday afternoon: “Today’s school finance commission report made clear that the state must reform the broken Robin Hood system and allocate more state funding to education. This session, we will do just that.”

The vote was the culmination of nearly a year of meetings and hours of testimony from school superintendents, education advocates and policy experts.

Panel members have bickered for months about basic foundational concepts, including whether the state had been underfunding public schools and whether they actually need more money in order to improve. The report takes a middle ground approach, promising more money to school districts that meet certain criteria or agree to offer specific programs such as dual language or merit pay for teachers.

Many of the debates among panel members Wednesday reflected their political divisions, with Brister — a conservative and Abbott appointee — arguing against citing a specific amount lawmakers should infuse into the public school funding system and school officials saying the panel should take an explicit stand based on its research.

An earlier version of the report said lawmakers should take the “important first step” of approving more than $1.73 billion in “new funding” for “the vast majority (if not all)” of the proposed programs.

The recommendation the commission approved Wednesday dropped that dollar figure.

Brister said he was uncomfortable sending a report to lawmakers that pressured them into making specific financial decisions.

“I am willing to say we will have to add new money to do these things. I am not willing to say, ‘And the first step is, every dime has to come from new money,” he said.

Nicole Conley-Johnson, chief financial officer of the Austin Independent School District, unsuccessfully argued to keep the paragraph in its original form.

“The spirit by which we were convened is to establish the changes and make recommendations,” she said. “I feel like we need to have the foresight to put in the estimated cost.”

Education advocacy groups criticized Brister’s decision. “There can be no real school finance reform that fails to address adequacy,” said Shannon Holmes, executive director of the Association of Texas Public Educators, in a statement after Wednesday’s vote. “ATPE is disheartened that some members on the commission were unwilling to acknowledge the reality of the limitation of our state’s current funding levels out of fears of sparking litigation.”

The report still includes cost estimates for recommended programs and changes to how funding is divvied up among schools. But it no longer implores state lawmakers to pay for them.

Among the recommendations the commission plans to send to lawmakers are:

  • $100 million a year to school districts that want to develop their own teacher evaluation metrics and tie pay to performance. The total amount available should increase $100 million each year until it reaches $1 billion.
  • Up to $150 million to incentivize school districts to offer dual language programs, which instruct students in both English and Spanish, and to improve their dyslexia programs.
  • $800 million to incentivize school districts to improve students’ reading level in early grades and to succeed in college or a career after graduating high school.
  • $1.1 billion to improve education for low-income students, with school districts that have a higher share of needy students getting more money.
  • Create a new goal of having 60 percent of third-grade students reading on or above grade level and 60 percent of high school seniors graduating with a technical certificate, military inscription, or college enrollment without the need for remedial classes.
  • Cap local school district tax rates in order to offer property tax relief and a small amount of funding for schools —a proposal from Abbott.
  • No extra funding for special education programs until the state has completed overhauling those programs in line with a federal mandate.

This article originally appeared in The Texas Tribune at https://www.texastribune.org/2018/12/19/texas-school-finance-panel-approves-final-report/.

 

Texas Tribune mission statement

The Texas Tribune is a nonprofit, nonpartisan media organization that informs Texans — and engages with them — about public policy, politics, government and statewide issues.

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.

From The Texas Tribune: A tight-fisted Texas Legislature with expensive ambitions

Analysis: A tight-fisted Texas Legislature with expensive ambitions” was first published by The Texas Tribune, a nonprofit, nonpartisan media organization that informs Texans — and engages with them — about public policy, politics, government and statewide issues.

The Texas Legislature’s strong allergy to tax increases might be abating — just as long as you don’t call them tax increases.

They’re not saying so out loud — no point in riling up a price-sensitive electorate before the holidays, before the upcoming legislative session — or before lawmakers are ready to make their sales pitch.

But the talk of school finance as a top legislative priority guarantees a conversation about taxes. While there are many great policy reasons to mess with that persistent and gnarly issue, the political motivation here is simple: Texas property owners have made it clear to their representatives that they want lower property taxes.

When you do hear lawmakers talking about tax increases next year — whatever euphemisms they choose — they’ll be talking in terms of how that money will pay for property tax cuts. Cutting everyone’s current most-hated tax is the only way to explain so many conservative legislators making serious noises about increasing state revenue.

Given the way the state pays for public education — with a combination of local property taxes, and state and federal funding — the only ways to lower property taxes are to cut public education spending or to find money elsewhere to offset property tax cuts.

In the state’s 2019 fiscal year, the local share of school finance spending is estimated to be 55.5 percent of the total, while the state’s share is expected to be 35 percent, according to the Legislative Budget Board. The rest comes from the federal government.

The last time the Texas Legislature tackled school finance, the local and state shares matched. Years of rising property values – and rising local property tax revenue with them – have allowed the state to lower its share.

The price tag for a rebalancing would be enormous, though. And in spite of Democratic gains in last month’s elections, Texas still has a Republican-dominated state government, with GOP majorities in both the House and Senate, and Republicans in every statewide office. Many of them got where they are by opposing anything that sounded like higher taxes, which makes the road ahead pretty interesting.

If you do some quick arithmetic on those 2019 estimates, it would take a $5.7 billion increase in annual state spending to rebalance the state and local shares of public education spending. Doing that would put them both back where they were in 2008 — each covering about 45 percent of the load.

That’s easier to do on the back of an envelope than it is to do in the Legislature. The budget ahead is tight. House and Senate leaders have to pass what’s called a “supplemental appropriations bill” to take care of shortages in the current budget, Hurricane Harvey recovery costs, and so on. Early guesstimates are that they’ll start more than $5 billion short of what they need for the next budget — and that’s before they even bring up the expensive school finance project.

The governor already is circulating a document that dares to mention taxes in the title: “Improving Student Outcomes and Maintaining Affordability through Comprehensive Education and Tax Reforms.”

That gets right to the politics of the situation: State leaders are interested in easing property tax burdens, and school finance is the biggest lever in their toolkit. It’s also way out of balance and happens to need fixing. Lawmakers often blame the imbalance on school funding formulas. But they’re the authors of those dreaded formulas, and this is also a chance to put something better in place.

But it’s the tax problem — the price of owning property — that has made their price-sensitive voters potentially receptive to increases in other taxes. New money could come from eliminating exemptions, from property appraisal reforms, from raising existing tax rates or creating new taxes — any number of things. They’ll decide the details when they meet. They’ll figure out what to call it, too: It might be remarkable to see “tax” in the title of the governor’s presentation, but its neighboring word — “reform” — is the political touch.

They want to lower property taxes to make their voters happy, and to accomplish that expensive task without stirring up a new revolt from a different set of taxpayers.

At the end, someone in Texas has to pay for this stuff.

 

This article originally appeared in The Texas Tribune at https://www.texastribune.org/2018/12/03/tight-fisted-texas-legislature-school-finance-property-tax/.

 

Texas Tribune mission statement

The Texas Tribune is a nonprofit, nonpartisan media organization that informs Texans — and engages with them — about public policy, politics, government and statewide issues.

School finance commission subcommittee approves expenditures plan

The Expenditures Subcommittee of the Texas Commission on Public School Finance met this week to lay out and vote on their recommendations back to the full commission. Based on both the recommendation and what the committee members had to say, it became clear that their primary goal is to drive dollars into increasing the basic allotment. They also have secondary goals of shifting funds out of programs not tied to educational programming and into programs designed to increase educational attainment for harder-to-teach students, particularly economically disadvantaged populations and English language learners.

The committee has not publicly released its report yet, but a summary breakdown of the recommendations can be found below. A video archive of the full subcommittee meeting, which lasted a little under an hour, is also available.

Group 1 – Reallocations of existing programs. This group represents approximately $5.3 billion to be spent on increasing existing initiatives and creating new initiatives.

  • Reallocate the Cost of Education Index (CEI) – $2.9 billion
  • Reallocate the 92-93 Hold Harmless – $30 million. This program only impacts 12 -20 school districts.
  • Reallocate the Ch. 41 Early Agreement Credit – $50 million. Eliminates a program that currently pays property wealthy districts to sign an annual contract by Sept. 1 agreeing to pay the state what they owe in recapture. The discount did not require districts to prepay or early pay.
  • Reallocate the Gifted and Talented (GT) allotment – $165 million. This recommendation eliminates the stand-alone allotment but does not eliminate other requirements to provide GT education from the Texas Education Code (TEC). Currently 99.9% of districts are at the 5% GT cap, meaning the same dollars can be more efficiently flowed out to schools through the basic allotment.
  • Reallocate the High School Allotment – $400 million.
  • Move from prior year to current year property values – $1.8 billion.

Group 2 – Increased spending on existing programs

  • Increase state compensatory education allotment from 0.2 to a spectrum that ranges from 0.225 and 0.275 as part of a tiered system that pays out higher amounts to campuses with more severely challenging populations. Currently, the recommendation is still based on free and reduced lunch but could use a more sensitive metric.
  • Change the transportation allotment to a millage-based approach at 0.83 cents per mile, to be set by appropriations.
  • Allow Ch. 41 districts to get compensated by the transportation allotment at a $60 million cost.
  • Fund the stand-alone small-size and mid-size district adjustment between $0 and $400 million outside the basic allotment, depending on where the basic allotment is set.
  • Increase the New Instructional Facilities Allotment (NIFA) to $100 million. This represents a $76 million increase over last session.
  • Expand Career and Technical Education (CTE) funding to include sixth through eighth grades – $20 million.

Group 3 – New programs

  • Create a dual language allotment of 0.15 at a cost of between $15 and $50 million. This new allotment would be in lieu of (not in addition to) the bilingual allotment; you can either get the bilingual allotment or the dual language allotment, but not both.
  • Create a dyslexia allotment of 0.1 – $100 million.
  • Create a Kindergarten through third grade ELL/economically disadvantaged allotment of 0.1 – $786 million. This money is not tied to outcomes and can be used to fund any program that seeks to improve reading and math on grade level by grade three, including paying for full day Pre-Kindergarten programs.
  • Create a grade three reading bonus of 0.4 – $400 million. This provides incentive money for students meeting grade level in reading on the 3rd grade standardized test.
  • Create a College, Career, and Military Readiness Bonus – no specific weight – $400 million. This is envisioned as a reallocation of the High School Allotment and is aimed to drive the state’s “60/30” goals.
  • Create a teacher compensation program – $100 million. This is the governor’s performance pay program. It is formula-based, not grant-based, and is not subject to appropriation. There will likely be no fiscal note for the program until year three, and it is envisioned to grow over time.
  • Fund an extended year summer pilot program – $50 million. This program is intended to reduce summer learning losses for disadvantaged students.

Additional changes recommended:

  • Change the guaranteed yield on the copper pennies from a set dollar amount to a percentage of the Basic Allotment. When the yield was set, the dollar amount used represented approximately 88% of the basic allotment. Now it is much less. Increasing the guaranteed yield increases state entitlement, which helps property poor districts and recapture districts.
  • Decouple the golden pennies from Austin ISD.

Stay tuned to Teach the Vote for reporting on future actions of the commission.

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.