From the Office of State Senator Royce West - District 23

For Immediate Release
CONTACT: Kelvin Bass
(512) 463-0123
June 29, 2005

This Session On School Finance Must Not Be More Time Wasted

by Royce West

A sage adage speaks to the merits of perseverance; "If at first you don't succeed..." That's where we are with our attempts to change how we fund public schools in Texas. We must try again. The last major overhaul to school finance took place in the early '90's, creating a system of recapture commonly known as "Robin Hood" where funding is redirected from property-rich districts to less affluent schools.

While Robin Hood has its critics, the bottom line is that the state doesn't spend enough money to properly fund public education. The state contributes less than 40 percent of total funding for public schools; an all-time low. Local property taxes now represent the bulk of school funding.

We have known since 2001 that changes to the school finance system must be made. With Texas facing a record budget shortfall heading into the 2003 session, neither the economic or political climate were conducive to a school finance overhaul. Last spring, Governor Perry called the Legislature back for a special session on school finance that proved to be a exercise in futility. Then, before the 2005 Regular Session, Austin District Judge John Dietz ruled Texas' school finance system unconstitutional, citing its heavy reliance on property taxes.

School finance is an extremely complicated issue. Combined with education reform, the task becomes more daunting. Some lawmakers have promised a property tax reduction to Texas homeowners. But every property tax dollar that leaves school coffers must be replaced by another funding source. And not to forget, the present level of funding has also been ruled inadequate. Still, there are some who feel that achieving property tax reduction is more important than properly funding our schools.

We're fast running out of time to come up with a new school finance system. On July 6th, the Texas Supreme Court will hear the state's appeal of Dietz's verdict. Favorable ruling or not, the Legislature's duty is still before us. By court order, a finance plan must be in place by October 1.

Both the House and the Senate have passed education finance reform plans out of committee that are now being debated. The House plan would raise the state sales tax by 1 cent to 7.25 percent, making it one of the nation's highest. Governor Perry's plan also would increase the sales tax by .7 percent, to 6.95 percent on the dollar, and applying it to previously untaxed services like car and computer repairs and cosmetic surgery. The Senate's plan would increase the sales tax by a half cent to 6.75, but not expand to include other items.

I have opposed sales tax increases because they cost more to those who can least afford it. The Comptroller estimates that, for families earning about $150,000 annually, the sales tax represents about 1.6 percent of their income. But for families earning $35,000 a year or less, the sales tax takes anywhere from 4 percent, or up to 10 percent from the poorest of families.

The House plan would increase teacher pay by $2,000 annually; the Senate's plan by $ 3,000. The governor proposes a $1,500 increase. Presently, Texas teachers are paid about $6,000 less annually than the national average. Still, these increases should be across the board and not tied to performance on standardized tests.

Smokers would pay $1 per pack more under the House and governor's plan. The Senate proposes raising cigarettes taxes by 75 cents and increasing taxes on alcohol by 13 percent.

The Legislative Budget Board reports that only families who earn more than $100,000 annually would benefit from the House's tax reduction plan, while overall, taxes for those earning less would increase. The Senate plan would increase school spending by $3 billion; the House plan by $2.5 billion over the next two years. The House, Senate and governor differ on how the current business tax structure should change.

One component that has yet to resurface during this special session is the topic of school choice, better known as vouchers. Let's hope it stays that way. We don't need the added distraction about whether state funds should pay for kids to go to private schools when we know that public schools are already underfunded. And any plan that limits recapture would only exacerbate differences in the quality of education that exists in districts and schools across Texas.

It's all a question of priorities. While I'd love to see lower taxes, we must understand that the long-term future of our state depends on providing an adequate education that will enable the next generation of Texans to thrive and prosper. Industry depends on a skilled and educated workforce. And that is best achieved by meeting the educational needs of all Texas children, not just the ones who live where schools are supported by a healthy tax base.

For more information, please contact Kelvin Bass at 214-467-0123.