FACTS ABOUT SCHOOL FINANCE Santa Fe Independent School District 2009

CHALLENGES Navigating the State Financial System Managing Student and Facility needs

FACTS about Texas School Finance 4.6 million students 322,000 teachers $40 billion in state aid and local property taxes 80,000 new students each year

FACTS Per student funding is based on the value of homes in 2006 Taxes generated from increases in your home value since 2006 go directly to the state Transportation funding has not increased since 1985

FACTS about SFISD School Finances $38,000 million general fund budget 4600 students 375 -teachers, librarians, nurses,admin 256 - bus drivers, child nutrition, maintenance, custodians and para professionals

Pre 2006 School Funding Revenue – sources: Local property value (13m) and state funding (21m), federal (2m) Maintenance & Operations Tax Cap Tax cap of $1.50 per $100 valuation SFISD - $1.04 Debt Service tax SFISD 2008 - $ .12 to increase with bond sales approved Nov. 2008

Pre 2006 Funding System The system was declared unconstitutional in 2006 Rewritten during special session of the 2006 legislative session House Bill 1 resulted

House Bill 1 Intended to provide for School Funding and tax reform including: High School Allotment support $2500 teacher salary increase Reduced local Maintenance and Operations property tax rate by 1/3 over two years Created local tax options to authorize .04 without voter approval and then additional .13 with voter approval (SFISD exercised .04, but not .13)

Target Revenue……….$4645 HB 1 established a “target revenue” concept State guarantees base revenue per student SFISD target revenue amount is $4645 per student In Galveston county Tx city is highest at $5706 per student A difference per student of $1061 per student The target revenue amount per WADA remains fixed per district while costs increase

ADA Average Daily Attendance (ADA) = Counting the days a student is actually physically present in school. School districts have enrollment and attendance Attendance Matters!

WADA…………….5350 Unique program costs raise the cost of educating individual students Career & Technology Special Programs Gifted and Talented ESL/bilingual Compensatory Education WADA is Weighted Average Daily Attendance – Mathematical calculation applied to ADA Program weights are added to account for increased cost of educating students who need special programing

WADA fixed The state will not change the revenue per WADA for any district without legislative action Under the current funding system, children in Texas do not have equal access to educational dollars

Arbitrary system based on 2006 levels The system is disproportionate Unequal access to funding providing inequity in ability to educate students comparably Target revenue is frozen at 2006 level requiring legislative action to change (2009) Target revenue not adjusted for inflation of cost (insurance, fuel, salaries)

Target Revenue Downfalls Does not cover total cost of maintenance and operations as expenses increase Does not provide for salary increases If local values increase, state reduces district funding – district does not benefit from new growth or building as target revenue is frozen

Public School District Revenue As Property Values go up…………………………… As Property Values go Down……………………… Money the state sends the district decreases Money the state sends to the district increases

How can a district generate additional funding? More students generate more funds But districts have no control over population growth The state does not allow a district to raise the current tax rate without a successful rollback election from voters

Revenue Options Election required of voters Trustee approve a budget with expected increases District authorizes and holds roll-back election If fails, must provide budget cuts Or: Consider budget cuts to accommodate during budget process

What should be expected? Every taxpaying citizen should expect an equitable, adequate funding system that provides a quality education for all children regardless of the public school district a child attends. This ensures a highly-educated workforce that contributes to a strong state economy.

What can be done? Every parent should learn about the inequities in the school finance system and expect the same funding for every child in the state of Texas after taking into consideration unique program costs (special programs, GT). Who can fix the problem? The Texas Legislature

Budget Key budget drivers include Personnel – 85% of budget Enrollment – staffing Adjustments for cost of living increases for personnel – 3% raise equates to approximately 1 million in budget costs/year Operational costs – technology support, instructional support (instructional specialists, math and science) Inflationary pressures – utliity, fuel, insurance that have increased dramatically since 2005

Budget Development SFISD passed deficit budget 2007, 2008 to accommodate salary increases without significant cuts in personnel and programs Funds available through revenue – federal/state/local - $37M > 38M – expenditures, > +1M EXPENSES Staff - 2007:$22.4; 2008:$24.5; 2009: $24.8 Salary increases $ 1 million Fuel cost adjustments $2007:790k; 2008: $1.2; 2009: $1.4 Educational programs/support $18million, 20M; ^2.4 Funds required – salary + increases + program costs – $1.0 M + payroll-$777,000+fuel-$200,000 + $375,000

Options Cut expenses – (85% of budget personnel) Use fund balance Roll back election Options utilized to date: Accessed .04 to provide M & O of $1.04 Deferred additional personnel 10% cuts per budget manager

Short Term Eliminate Roll back provision allow districts authorize increases Provide funding system to meet uncontrollable and inflationary costs Utility/fuel/energy/insurance Teacher/staff salary increases Consider allotment adjustments HS allotment - $250 Technology - $35 Transportation - $35

Long Term Provide stable source of funding for public education to grow with economy Provide equitable revenue structure – adjust or eliminate target revenue Modify election feature for tax increases Provide permanent adjustments for inflationary costs Modity formulas that are outdated (not adjusted since 1980)

Unfunded State Mandates Accelerated Reading/Math – 10 students Dyslexia services Compensatory services PGP 7-12 GT services 4X4 plan School Health program k-8 College Credit (12 hr) EOC – 2011 Fitness Gram k-12 Class size limit

Unfunded Accountability Test administration and security Home-schooled FIRST Benefits Criminal background checks CPR, AED Bus Evacuations Abatement cert PEIMS Public notices – reporting – aeis, budget

Contact Senator Mike Jackson Representative Larry Taylor