For the first time since being assembled by Gov. Greg Abbott, Lt. Gov. Dan Patrick, and Speaker Joe Straus, the Texas Commission on Public School Finance met today for the first of several public meetings the commission is slated to hold prior to the beginning of the next legislative session in January 2019.
Though the bulk of the agenda centered on educational outcomes, property tax reform quickly came into focus.
In a letter read at the beginning of the meeting, Abbott underscored his three goals for the commission:
- Change the structure of the current school finance system by focusing on student outcomes.
- Modernize education, by focusing on innovation in the classroom.
- Explore alternatives to burdensome property tax system for funding Texas schools
The final point is the most contentious, especially after a year in which obstructionists in the Texas House killed property tax reform twice, during the regular and special legislative sessions. Justice Scott Brisher, who chairs the commission, predicted that recent tax cuts at the federal level would put pressure on the state to reform the current property tax system this year, especially as property owners receive their tax bills in the mail.
State Sen. Paul Bettencourt (R–Houston) was quick to highlight the stranglehold skyrocketing property taxes are placing on Texas homeowners, noting taxes are growing at twice the rate of Texans’ ability to pay them. He also praised the property tax reform plan laid out last week by Abbott, which calls for the placing of a 2.5% cap on property tax revenue growth from local taxing entities, including school districts, as well as greater transparency for ballot measures that increase local debt, such as school bonds:
The real data shows that school property tax levies are actually growing much slower than property tax revenues collected by counties, cities, and special districts. The plight of the taxpayer is clear, average property tax bills are rising roughly twice as fast as Texans’ paychecks. As a taxpayer advocate we need to reduce growth rate to something that Texans can afford.
House members on the commission who have helped kill property tax reform, like State Rep. Dan Huberty (R–Humble), who chairs the House Public Education Committee, and State Rep. Ken King (R–Canadian), wisely shied away from directly attacking Abbott’s proposal, but echoed the talking point from last session that “you can’t have property tax reform without school finance reform.”
School finance is an issue most legislators can agree on in the abstract. However, the devil is in the details. Conservatives in the legislature have desired to take a careful approach to reform by evaluating efficiencies and repealing state recapture, also known as “Robin Hood”, which takes property tax money from property-wealthy districts and redistributes it to other school districts. Liberal members have seen school finance reform as an opportunity to throw even more money into schools, in order to eventually necessitate a statewide payroll or income tax.
The School Finance Commission was a special session priority for Abbott. Created in the final hours of the special session in August as part of a compromise on House Bill 21, an omnibus education bill, the Commission is charged with studying the methods by which the state funds public education prior to the next legislative session and make recommendations to the governor and lawmakers.
While both Abbott and Patrick were quick to release their appointees, it wasn’t until after Patrick rebuked Straus for failing to make his appointments by the mandatory December 14th deadline that Straus finally announced his list days after the deadline.
Invited testimony at the hearing included Lloyd Potter, the Texas State Demographer, who discussed the coming change in population demographics throughout the next decade, Justice Craig Enoch, as well as Texas Education Agency Commissioner Mike Morath. A reformer while on the Dallas ISD school board, Morath was appointed to head the TEA in December 2015.
The Commission is scheduled to have at least two additional meetings in February before they prepare their findings. Citizens who oppose out-of-control property taxes and the creation of new state taxes should pay close attention to the commission and their findings as they set the stage for school finance and property tax reform in 2019.