State Tax for Schools in New Plan

AUSTIN – Acting Lt. Gov. Bill Ratliff will unveil a new school finance plan today that would rely on a statewide property tax to equalize education funding between poor and rich districts.

Ratliff’s proposal would replace the formula dubbed “Robin Hood” that he guided through the 1993 Legislature. That plan requires wealthy school districts to send money raised from local property taxes to the state, which then redistributes the funds to poorer districts, resulting in the nickname.

The Mount Pleasant Republican, who wields considerable influence in the Legislature, will outline his proposal before a special panel of lawmakers and citizens examining ways to ensure that students from low-income regions receive an education on par with students from more affluent areas.

A spokeswoman said the details of Ratliff’s proposal will not be made public until the Legislature’s Joint Committee on School Finance meets in Austin today, but she confirmed that a statewide property tax is included in the proposal.

“The reports [about the state property tax] are accurate but the full plan is not being laid out until [today],” said Mary Jane Wardlow, Ratliff’s media aide. “Nobody’s getting an advance copy. You all can see it at the same time.”

Currently, the state’s 1,000-plus school districts raise the bulk of their revenue through local property taxes. However, some districts are laden with high-dollar properties, which generate more revenue, while others are saddled with less-valuable properties that produce far less money for the schools.

Almost since its inception, the Robin Hood formula has come under fire from school officials in property-rich districts, who sometimes found themselves having to raise local tax rates in order to send money to Austin to be redistributed.

And some districts have complained that the state-mandated tax cap of $1.50 per $100 of appraised property value limits their ability to adequately fund local schools.

Public policy analysts differed on whether a single statewide property tax would bring about a fairer method for financing public schools.

“I think the statewide property tax would help with some of the school finance problems because it automatically equalizes the revenue stream,” said Dick Lavine, who heads the liberal-leaning Center for Public Policy Priorities. “All of the money goes into one big pot and it gets doled out based on the average daily attendance of the various districts.”

Peggy Venable, director of conservative watchdog group Texas Citizens for a Sound Economy, said she is skeptical of any new statewide tax. However, she said she would reserve judgment on Ratliff’s plan until she has seen the details.

“I will be disappointed if it leads to higher taxes,” said Venable, a former official with the U.S. Department of Education. “I appreciate the fact that he’s trying to address education and tax equity issues, but I’m not convinced that this will be the way to do it.”

Venable said she would oppose any effort to dilute the authority of local school boards.

“Local control is at the core of the issue,” she said. “I believe that money to be spent locally should be raised locally. As a parent, I want to see our schools remain local.”

Jim Alloway, president of the Texas Taxpayers and Research Association, said Ratliff has briefed him on the plan and it appears similar in concept to one promoted by former state Sen. Carl Parker, D-Port Arthur, several years ago.

“He did not act like the local districts would have no flexibility at all,” said Alloway, explaining that the plan apparently will include both revenue from a statewide property tax and revenue from local taxes. Any statewide property tax would necessitate a constitutional amendment, as well as a vote of the public.

“He was not proposing an expansion of the school program. He was trying to demonstrate a different way” of raising revenues, Alloway said.

Alloway said one of the biggest concerns with a statewide property tax is the possibility of a lack of consistency among appraisal districts. “One of the biggest dangers for a taxpayer in any jurisdiction in the state is how the appraisal districts would operate,” Alloway said. “If it operated different in Tarrant County than in Dallas County, then the state would consequently flow more money from one over the other – but not based on any real differences.”

Alloway also said that residential and business property should be taxed at the same rate. “Property is property,” he said. “Businesses have as much interest in an educated population as people who own residential property.”

State Rep. Kent Grusendorf, R-Arlington, a member of the special school finance panel, declined to speculate on what plan might emerge from the panel’s work and be presented to the Legislature when lawmakers return to Austin in January.

However, if a statewide property tax is in the mix, he said, the final plan could not be implemented immediately.

“A statewide property tax is unconstitutional.” Grusendorf said. “The voters would have to agree to change the [state] constitution for it to go into effect.”