texas taxpayers and research association june 7, 2012 (512) 472-8838 financing public education june...

Texas Taxpayers and Research Association June 7, 2012

www.ttara.org

(512) 472-8838

Financing Public Education

June 7, 2012

Dale Craymer

El Paso Chamber of Commerce


www.ttara.org

(512) 472-8838

Texas School Finance by the Numbers


www.ttara.org

(512) 472-8838

1,250 school districts (#1 in the nation)

– 1,024 Independent School Districts (Size ranges from 17 – 200,000 students)

– 226 charter schools, military, special districts

8,526 campuses

Texas Public Education System2010-2011 School Year


www.ttara.org

(512) 472-8838

4.9 million enrolled students (#2 in nation)

– 4.8 million in ISD’s (97.3%)

– 0.1 million in charter schools (2.7%)

– Enrollment increases 1.7% per year (80,000 students)

663,146 school employees (#1 in nation)

– 334,876 teachers

Texas Public Education System (cont.)2010-2011 School Year

Source: TEA Snapshot 2011


www.ttara.org

(512) 472-8838

1999 2011Growth/ Decline

Hispanic 39% 50% +11%

White 44% 31% -13%

African American 14% 13% -1%

Other 3% 6% +3%

100% 100%

Student Population

Source: TEA Snapshot 1999 and 2011


www.ttara.org

(512) 472-8838

Total Annual Funding $48.1 Billion2011-12 School Year

Federal Funds$5.6 Billion

(11%)

Property Tax$22.0 Billion

(46%)

State Funds$20.5 Billion

(43%)


www.ttara.org

(512) 472-8838

Percent of Total

Economically Disadvantaged

59%

Limited English Proficient 17%

Student Population 2011

Source: TEA Snapshot 2011

Economically disadvantaged is defined as eligible for the free and reduced price lunch program. Eligibility income requirements are between $29,055 - $41,348 annual income for a family of four.


www.ttara.org

(512) 472-8838

The Foundation School ProgramIn a Nutshell

• School finance is a shared responsibility of the state and local school districts.

• In its very simplest terms, the state guarantees districts a certain amount of money per student at certain tax rates.

• If local tax revenue falls short of that guarantee the state makes up the difference.

• If local tax revenue exceeds the guarantee, the excess is “recaptured.”


www.ttara.org

(512) 472-8838

School Finance… supposedly

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

District A District B District C District D District E

$100,000 $200,000 $300,000 $500,000 $1,000,000

State AidLocal Property Tax

M&O Revenue Per Student at $1.00 Tax Rate

Recapture

Property Wealth Per Student


www.ttara.org

(512) 472-8838

School Finance... more accurately

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

District A District B District C District D District E

$100,000 $200,000 $300,000 $500,000 $1,000,000

State AidLocal Property Tax

Recapture

Property Wealth Per Student

M&O Revenue Per Student at $1.00 Tax Rate


www.ttara.org

(512) 472-8838

Is the School Finance System Completely Equal?

• No, but whether the disparities in funding rise to a level that violates the Texas Constitutional provision for an “efficient” system will be decided by the courts.


www.ttara.org

(512) 472-8838

$0.00

$0.25

$0.50

$0.75

$1.00

$1.25

1 2

Tax Rate Per $100 of value

Schools levy up to $1,00 to finance their share of the cost of education

Schools boards may levy an additional $0.04 at their discretion for “enrichment”

Voters may approve an additional $0.13 for enrichment


www.ttara.org

(512) 472-8838

School Districts & their Tax Rates 2011 Tax Year

0

100

200

300

400

500

600

700

Under $1.04 $1.04 $1.05 to $1.16 $1.17

Number of Districts


www.ttara.org

(512) 472-8838

Has the Local School Tax Become a De-Facto State Property Tax?

• The Texas Constitution prohibits a state property tax

• While school tax rates are “clustered” near $1.04 and $1.17, it will be up to the courts to decide if schools have sufficient meaningful tax discretion, or if the local tax is, for all intents and purposes, a state tax


www.ttara.org

(512) 472-8838

School Districts InEl Paso County

Compared toHighest Target

Revenue Districts

2011-12Total State & Local

M&O Revenueper WADA

2011-12State & Local

Revenueper WADA @Compressed

M&O Rate # WADA

CompressedM&O Tax

Rate

2011M&O

Tax Rate

Anthony ISD $5,166 $4,988 1,183 $1.00 $1.04

Canutillo ISD

$6,031 $5,308 7,353 $1.00 $1.17

Clint ISD $5,399 $5,185 14,008 $1.00 $1.04

El Paso ISD $5,315 $5,191 74,701 $1.00 $1.04

Fabens ISD $5,279 $5,087 3,362 $1.00 $1.04

San Elizario ISD $5,437 $5,053 5,269 $1.00 $1.11

Socorro ISD $4,970 $4,811 51,413 $0.91 $0.95

Tornillo ISD $5,520 $5,093 1,772 $1.00 $1.09

Ysleta ISD $5,608 $4,995 53,569 $1.00 $1.17

Wink-Loving ISD $22,976 $12,544 550 $1.00 $1.04

Sundown ISD $19,025 $12,544 842 $1.00 $1.04

Westbrook ISD $18,341 $13,121 339 $0.93 $1.00

2011-12 Revenue per WADA in El Paso County

Source: TEA Summary of Finance


www.ttara.org

(512) 472-8838

Public Schools in the State Budget


www.ttara.org

(512) 472-8838

Comptroller’s Revenue Estimate (Billions of Discretionary Dollars)

Item 2010-11 2012-13 Difference

Beginning Balances $5.8 ($4.3) ($10.1)

Federal Stimulus Funds $8.3 $0.0 ($8.3)

Current Revenues $75.8 $80.9 $5.0

Total Revenue Available $89.9 $76.7 ($13.4)

Note: Amounts include state general revenue funds and all funds which interact with general revenue as an offset, including the property tax relief fund and the portion of 2010-11 federal stimulus money used to supplant general revenues.


www.ttara.org

(512) 472-8838

Item 2010-11 2012-13 Difference

Beginning Balances $5.8 ($4.3) ($10.1)

Federal Stimulus Funds $8.3 $0.0 ($8.3)

Current Revenues $75.8 $80.9 $5.0

Total Revenue Available $89.9 $76.7 ($13.4)

Note: Amounts include state general revenue funds and all funds which interact with general revenue as an offset, including the property tax relief fund and the portion of 2010-11 federal stimulus money used to supplant general revenues.

Comptroller’s Revenue Estimate (Billions of Discretionary Dollars)

$18.4


www.ttara.org

(512) 472-8838

Start of Session Horror Stories

• Public schools would see a 15% cut in per student spending

• Medicaid providers were going to be cut 10% across-the-board

• 4 junior colleges were going to be closed

• No financial aid for incoming college freshmen


www.ttara.org

(512) 472-8838

Revenue/Savings Measures

• Comptroller raised 2011 revenue estimate by $1.5 billion

• HB275 by Pitts: Appropriates $3.2 billion from the Rainy Day Fund to close the 2011 deficit

• HB4 by Pitts: Cuts a net of $1.2 billion from existing 2011 state appropriations (and appropriates an additional $0.8 billion for schools)


www.ttara.org

(512) 472-8838

Revenue/Savings Measures,continued

• SB 1 by Duncan (special session “fiscal matters” bill):– Defer August school payment $2.3– Various tax provisions $0.8– Rewrite school finance formulas $4.0


www.ttara.org

(512) 472-8838

The 2012-13 Budget, as passedGeneral Revenue, Federal Stimulus & Property Tax Relief

Area 2010-11 2012-13 $ Diff % Diff

Public Education $42.1 $38.31 ($3.8) -9.0%

Health/Human Svcs 25.8 22.7 (3.1) -12.1%

Higher Education 13.1 11.8 (1.3) -9.9%

Pub Safe/Crim Jus 8.6 8.1 (0.5) -6.1%

Other 4.9 4.2 (0.7) -14.8%

Total $94.5 $85.0 ($9.5) -10.0%

1 An additional $2.3 billion will be made available in September of 2013.


www.ttara.org

(512) 472-8838

% of Total

2010-11 School Year

2011-12 School Year Difference

% Difference

% of Reduction

District Admin

3% 20,899 20,978 80 0.4% 0%

Campus Admin

3% 17,664 17,350 - 314 -1.8% 1%

Teachers, Instr Staff

61% 406,732 390,387 -16,345 -4.0% 65%

Campus Prof Staff

33% 221,207 212,827 -8,380 -3.8% 34%

Total 666,502 641,542 -24,960 -3.7%

School District Staffing 2010-11 vs. 2011-12

Data Source: Texas Education Agency


www.ttara.org

(512) 472-8838

Thanks for Joining Us!If you have any questions or

comments, please feel free to contact TTARA staff.

Dale Craymer [email protected]

John Kennedy [email protected]

Sheryl Pace [email protected]

Bill Allaway [email protected]

George Christian [email protected]

Ryan Ash [email protected]

texas taxpayers and research association june 7, 2012 (512) 472-8838 financing public education june...

Documents