Texas Taxpayers and Research Association June 7, Financing Public Education June 7, 2012 Dale Craymer El Paso Chamber of Commerce

Texas Taxpayers and Research Association June 7, Texas School Finance by the Numbers

Texas Taxpayers and Research Association June 7,  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 System School Year

Texas Taxpayers and Research Association June 7,  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.) School Year Source: TEA Snapshot 2011

Texas Taxpayers and Research Association June 7, Growth/ Decline Hispanic 39% 50% +11% White 44% 31% -13% African American 14% 13% -1% Other 3% 6% +3% 100% Student Population Source: TEA Snapshot 1999 and 2011

Texas Taxpayers and Research Association June 7, Total Annual Funding $48.1 Billion School Year Federal Funds $5.6 Billion (11%) Property Tax $22.0Billion (46%) State Funds $20.5 Billion (43%)

Texas Taxpayers and Research Association June 7, 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.

Texas Taxpayers and Research Association June 7, The Foundation School Program In 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.”

Texas Taxpayers and Research Association June 7, School Finance… supposedly

Texas Taxpayers and Research Association June 7, School Finance... more accurately

Texas Taxpayers and Research Association June 7, 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.

Texas Taxpayers and Research Association June 7, 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

Texas Taxpayers and Research Association June 7, School Districts & their Tax Rates 2011 Tax Year

Texas Taxpayers and Research Association June 7, 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

Texas Taxpayers and Research Association June 7, School Districts In El Paso County Compared to Highest Target Revenue Districts Total State & Local M&O Revenue per WADA State & Local Revenue per Compressed M&O Rate# WADA Compressed M&O Tax Rate 2011 M&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, $1.00 $1.04 Sundown ISD $19,025 $12, $1.00 $1.04 Westbrook ISD $18,341 $13, $0.93 $ Revenue per WADA in El Paso County Source: TEA Summary of Finance

Texas Taxpayers and Research Association June 7, School Districts In El Paso County Compared to Highest Target Revenue Districts Total State & Local M&O Revenue per WADA State & Local Revenue per Compressed M&O Rate# WADA Compressed M&O Tax Rate 2011 M&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, $1.00 $1.04 Sundown ISD $19,025 $12, $1.00 $1.04 Westbrook ISD $18,341 $13, $0.93 $ Revenue per WADA in El Paso County Source: TEA Summary of Finance

Texas Taxpayers and Research Association June 7, Public Schools in the State Budget

Texas Taxpayers and Research Association June 7, Comptroller’s Revenue Estimate (Billions of Discretionary Dollars) Item 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 federal stimulus money used to supplant general revenues.

Texas Taxpayers and Research Association June 7, Comptroller’s Revenue Estimate (Billions of Discretionary Dollars) Item 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 federal stimulus money used to supplant general revenues.

Texas Taxpayers and Research Association June 7, Item 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 federal stimulus money used to supplant general revenues. Comptroller’s Revenue Estimate (Billions of Discretionary Dollars) $18.4

Texas Taxpayers and Research Association June 7, 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

Texas Taxpayers and Research Association June 7, 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)

Texas Taxpayers and Research Association June 7, 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

Texas Taxpayers and Research Association June 7, The Budget, as passed General Revenue, Federal Stimulus & Property Tax Relief Area $ Diff% Diff Public Education$42.1$ ($3.8)-9.0% Health/Human Svcs (3.1)-12.1% Higher Education (1.3)-9.9% Pub Safe/Crim Jus (0.5)-6.1% Other (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.

Texas Taxpayers and Research Association June 7, % of Total School Year School YearDifference % Difference % of Reduction District Admin 3% 20,899 20, % 0% Campus Admin 3% 17,664 17, % 1% Teachers, Instr Staff 61% 406, , , % 65% Campus Prof Staff 33% 221, ,827 -8, % 34% Total 666, , , % School District Staffing vs Data Source: Texas Education Agency

Texas Taxpayers and Research Association June 7, Thanks for Joining Us! If you have any questions or comments, please feel free to contact TTARA staff. Dale John Kennedy Sheryl Bill George Ryan