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Thursday, September 21, 2023


Failing grade: Schools turn to the courts in state financing struggle

Pushed to the financial breaking point, Texas school districts are once again turning to the court system to resolve issues concerning their funding. More than $4 billion in budget cuts have been levied against the schools by the state and have galvanized a diverse coalition to sue the state over allegations of inequitable and insufficient financing.
Claiming that the existing monetary policies are destroying their ability to offer quality education to students and are forcing the dismissal of thousands of teachers, school districts are seeking greater control over their ability to set tax rates and a more egalitarian means of allocating state funds.
State legislators have been silent on the matter other than to issue hollow words of regret regarding the necessity of making tough financial decisions in dire economic times. It is up to the judiciary to take on an activist role and compel lawmakers to reform the broken system of school funding.
The laws governing school funding came into their present form through a series of court cases going back to the early 1990s. The state judiciary determined that previous attempts at creating a workable school funding program were unconstitutional, and lawmakers were forced to devise a new model. This resulted in the infamous Robin Hood Plan where property tax revenue from wealthy school districts is collected and distributed to poorer districts. Written in the same law was a strict limit on local property taxes at a maximum of $1.50 for every $100 of appraised property value.

Despite vociferous objections, until very recently the Robin Hood Plan has been successful in equalizing financial resources across the state’s 1,036 school districts. Recently, problems have arisen as the percentage of school funds coming from the state have diminished and school districts have become increasingly self-financed. Adding to this burden, districts’ revenue generating abilities have been further constrained when, in 2006, the property tax limit was lowered to $1.17 per $100.

After the most recent legislative session that gutted funding by the aforementioned $4 billion, school districts were left with little choice but to file suit against the state.

The crux of the districts’ legal arguments were that the state’s current school finance system is simply unconstitutional. However, frustrating their case is the fact that the law’s wording is sufficiently vague; it is open to many broad interpretations. One specific example is Article VII of the Texas Constitution: “It shall be the duty of the legislature of the state to establish and make suitable provision for the support and maintenance of an efficient system of public free schools.”

While an “efficient system” has come to be defined as one that is equitable, adequate and allows for meaningful discretion, few can agree on what each of those terms means. School districts argue that cuts in state funds are causing their existing financal inadequency in providing the proper education for students.

Out of desperation, teachers and staff have been let go which only furthers the already diminishing quality of education. In addition, all of their money is allocated to basic maintenance and operation costs, effectively preventing any discretion on how funds are to be spent.

If history is a guide, the courts will most likely rule in favor of the schools, and legislators will once again be forced to revise the law. They must face the fact that sustaining an efficient education system supersedes concerns about the budget.

School funding should not be subject to fiscal vicissitudes, and the local districts should not have their hands tied when it comes to raising revenue. The percentage of school funding that comes from the state should be fixed to the national average of roughly 49 percent. Less than 42 percent of school funds are currently state allocated. The tacit denial of reality by state lawmakers that taxes can never be increased must also be remedied. The cap on property taxes should be raised to the previous value of $1.50 per $100, thereby granting school districts greater financial autonomy.

Texas already has a reputation as a state that habitually sells its students and teachers short. With their lawsuit, school districts are merely taking a stand against an insufficient system of funding that threatens the very future of the state. Lawmakers should use this as an opportunity to display their solid commitment to education by providing the necessary and proper financial resources.

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