- Expect another school-funding lawsuit Texas educators cite struggle with flat financing since 2006 overhaul By JENNY LACOSTE-CAPUTO and GARY SCHARRER SANMessage 1 of 1 , Aug 2, 2010View Source
Expect another school-funding lawsuit
Texas educators cite struggle with flat financing since 2006 overhaul
By JENNY LACOSTE-CAPUTO and GARY SCHARRER
SAN ANTONIO EXPRESS-NEWS
Aug. 1, 2010, 10:43PMClose [X]
Despite numerous challenges and Band-Aids to Texas' school funding system over the past three decades, school leaders say another school finance lawsuit is imminent.
If it doesn't come before the legislative session that begins in January, a lawsuit likely will be filed by the spring as a growing number of schools contend with deep budget cuts that include staff layoffs and diminishing programs.
A worst-case scenario is already playing out in other states. Budget cuts are so deep in Oregon and California that many districts have shortened their school year. And in Hawaii the governor cut the school week from five to four days for the state's 171,000 public-school students.
School leaders across Texas say those kinds of drastic measures aren't far-fetched.
"Those are the kinds of things that will have to take place," said San Antonio ISD Superintendent Robert Durón. "It's closer than people realize."
The Texas Supreme Court charged the state Legislature with overhauling the state's school finance system in 2006. Lawmakers made property tax cuts, but didn't improve education funding. New state revenue sources such as an expanded business tax and a tax on cigarettes didn't cover the tax cuts.
Districts have been frozen at 2006 funding levels. Any increase in property values benefits the state, not the school districts.
"People don't seem to understand. They see their property tax bills going up and they assume that comes to the school district," Northside Independent School District Superintendent John Folks said. "They say, 'You're getting more money.' We are not getting more money. We're not getting more money from the state, and we're not getting any more money from property value increases. That's why districts are at a tipping point right now."
School districts across the state are already slashing budgets because of flat funding. Houston ISD, the state's largest district, cut more than 400 positions earlier this year. Districts have also increased class sizes, reduced bus routes, dipped into reserve funds and increased health premiums for employees.
"The system as a whole is in much stress across the board. You can find districts at all wealth levels that are struggling," said David Thompson, former general counsel of the Texas Education Agency and a veteran lawyer in school finance litigation.
"It's more likely, frankly, to come before the session," he said of the lawsuit.
Little hope for relief
Roughly 300 school districts already have reached the maximum tax rate of $1.17 for operations and maintenance. An estimated 60 percent of districts will have to dip into their reserve funds to meet operating expenses this coming school year — up from 49 percent for the school year that just ended.
No increase in funding means no money for inflationary costs and pay raises. But education policy experts say flat funding could be the best-case scenario to come out of the upcoming legislative session. During the 2008 session, lawmakers used $3.3 billion in federal stimulus money to balance the education budget - including paying for a state mandated pay raise for teachers. Districts will likely be stuck with that reoccurring bill, and school leaders worry about how the state will make up for the federal money they've depended on for the last two years.
"Our single biggest concern is whether or not the state will deliver on what's been promised," Durón said. "There's a huge shortfall out there. The big question looming for all of us is how are they going to make up that deficit."
House Education Committee Chairman Rob Eissler doesn't offer much hope for relief from the upcoming legislative session. The state is facing an estimated $18 billion shortfall.
"We're looking at worst case, and public education is 29 percent of the budget," said Eissler, R-The Woodlands, adding that there's virtually no hope of increased funding and deeper cuts are a real possibility.
"The amount of money we're spending is sizable," he said. "Maybe we need to look at how we're spending it and find ways to get more resources into things that work. Rather than add-ons, let's look at replacement."
The Texas Supreme Court issued four landmark school-finance rulings in the late 1980s and 1990s resulting from the 1984 Edgewood case. The court held that school districts and the children they educate must get similar tax revenue for similar taxing effort - and that the funding system must be efficient. The most recent high court ruling came in 2005, when justices found that so many school districts had reached the maximum taxing rate as to create an unconstitutional statewide property tax. The court ordered lawmakers to reform the system, which they did in 2006.
Yet today's system still results in extreme disparities, school leaders say. A potential lawsuit would focus not just on whether the state is funding public schools adequately, but whether that money is being distributed equitably.
While some contend that many districts are clamoring to file the lawsuit, North East Superintendent Richard Middleton thinks it's a no-win situation.
"We're $18 billion in the hole. Are you going to beat a dead horse?" Middleton said. "We barely got the money to cover our legal fees last time - and we won. I told David Thompson, 'We can't afford to win like that again, coach.' "
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