Texas School Finance History & Legislative Update April 2, 2019 B o e r n e I S D Texas School Finance History & Legislative Update April 2, 2019

School Finance History B o e r n e I S D School Finance History 7 lawsuits since 1984 Legislature tends to act only when facing deadlines or school financing system is ruled unconstitutional “Robin Hood” plan upheld by Texas Supreme Court in 1995 Recapture began with 34 districts paying $127 million/year Currently 217 districts pay $2.7 billion in recapture Without reform will grow to 350 districts at $5 billion by 2023

B o e r n e I S D Recapture Since 1994 Total: $25,960,100,000

B o e r n e I S D Source Of K-12 Funding 2008 to 2020

Last Major School Finance Reform - 2006 B o e r n e I S D Last Major School Finance Reform - 2006 Legislature cut local school property tax by 1/3 Lost revenue replaced by a new business tax State allocated more to public education State allowed extra $.06 in local school tax rate to pay for $3000 raise in teacher salary

Perfect Storm - 2011 Great Recession B o e r n e I S D Perfect Storm - 2011 Great Recession Federal Stimulus Aid expired - covered gap in state $ from 2009-2011 Slow economic expansion = smaller appraisal & tax revenue growth 2011 Legislature cuts $5.4 billion in K-12 education funding Despite gain of almost 400 students, Boerne ISD’s budget declined by $1.5 million between 2009-10 and 2011-12 school years

As Economic Growth Accelerated: Boerne ISD shared in the prosperity Road to Recovery As Economic Growth Accelerated: Property tax revenues grew at faster rate State Aid increased This more than offset growing recapture Boerne ISD shared in the prosperity From 2014-15 to 2018-19 budget grew $18 million Enrollment grew by 1900 students and district added over 100 teachers Increase in pay after several years of no raises

Road to Recovery Impact on Salaries: 2015-16 – 2% raise B o e r n e I S D Road to Recovery Impact on Salaries: 2015-16 – 2% raise 2016-17 – 2% raise 2017-18 – 2% raise 2018-19 – 3% raise

B o e r n e I S D Road to Recovery Impact on Benefits – Contributions to TRS Active Care: 2002 to 2015 – Increase from $225 to $262/mo. (16% over 14 years) 2016 – Increase from $262 to $287/mo. 2017 – Remained at $287/mo. 2018 – Increase for Employee Only from $287 to $305, Employee & Children to $320, Employee & Spouse to $335, and Employee & Family to $350

B o e r n e I S D Road to Recovery Impact on Benefits – Contribution to TRS Active Care from 2016 to present : Employee Only - $43/mo. or 16% Employee & Children - $58/mo. or 22% Employee & Spouse - $73/mo. or 28% Employee & Family - $88/mo. or 34% BISD increased benefits contribution by $450,000 since 2016

B o e r n e I S D 2019 Legislature “BIG 3” – Governor Abbott, Lt. Governor Patrick, Speaker Bonnen are all in agreement on key legislative priorities: School Finance Reform Teacher Raises Property Tax Reform

House Bill 3 - $9 billion in New Funding B o e r n e I S D House Bill 3 - $9 billion in New Funding $2.7 billion in tax relief – reduce M&O tax rate from $1.04 to $1.00 $6.3 billion in new funding beyond enrollment growth Increase Basic Allotment from $5140 to $6030 by redirecting Cost of Education Index, HS & GT Allotments Chapter 41 districts now eligible for transportation aid New Early Education & Dyslexia Allotment, increase Dual Language $ Educator Effectiveness Allotment Increase in Comp Ed from 0.2 to range of .225 to .275 Expand CTE to Middle School Teacher pay raises to come from increase in Basic Allotment

Senate Bills 3, 4, 5 - $9 billion in New Funding B o e r n e I S D Senate Bills 3, 4, 5 - $9 billion in New Funding $2.7 billion in tax relief – increase Homestead Exemption by 10k $2.3 billion in new funding beyond enrollment growth Many of the same features as HB 3, but not specific on $ amounts Includes Outcomes Based funding for 3rd grade reading & HS graduates being college, career, or military ready $4 billion for 5k teacher and librarian raise For Chapter 41 districts, pay increase reduces Recapture

What’s Next? Senate Finance Committee passed its budget 15-0 B o e r n e I S D What’s Next? Senate Finance Committee passed its budget 15-0 Senate must pass its budget & education bill House passed HB 1 (budget) that finances HB 3 by 149-0 HB 3 passed on April 3 by 148-1 Form Conference Committee to negotiate – by April 18? We will continue to lobby What we are not hearing this year – vouchers!!

Boerne ISD Legislative Priorities Increase in Basic Allotment – HB 3 Eligible for Transportation Aid – included in HB 3 Reduce Recapture – HB 3 Increased Transparency – HB 569, SB 328 Increase Aid for Fast Growth districts – NIFA increase in HB 3 Make TRS pension system actuarily sound – both House & Senate

Achieving our Priorities Would Mean B o e r n e I S D Achieving our Priorities Would Mean Increased teacher pay Hire more teachers to reduce class size Fund Capitol Replacement Plan School Security

B o e r n e I S D Next Steps Contact legislators Questions?