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By Lana Robinson
Field Editor
Time is running out for Texas lawmakers to come up with a plan to fund public education that meets with the Court's approval. State District Judge John Dietz, who ruled the Robin Hood system of funding public education unconstitutional, Sept. 16, has given the legislature one year to fix the problem. State officials speaking at Texas Farm Bureau's Legislative Seminar in Austin the same week seemed earnest in their desire to find a fair and equitable solution that shifts the burden away from tax-strapped property owners. But they conceded that it is no small task.
"If this was an easy issue, it would have been settled back in the 1970s," said State Rep. Kent Grusendorf (R-Arlington), commenting on the Robin Hood decision. "Ann Richards and George Bush both tried. I'm surprised we got 10 years out of that system."
Grusendorf, who chairs the Public Education Committee, noted that there had been four Edgewood decisions since 1987, and this most recent one would likely be appealed to the Texas Supreme Court.
"Without question, the tax system in the State of Texas is broken. We must restructure," he said. "The current constitutional crisis is because of overreliance on property taxes. Property taxes are way too high. We've got to bring them down."
Texas House Speaker Tom Craddick (R-Midland), who spoke at a luncheon later in the conference, drew applause with the same observation.
"Property taxes are too high. We should not be funding schools through local property taxes," said Craddick. "When we started out, the State paid 80 percent, and 20 percent was provided through 'local enrichment.' Today, the State pays 41 percent and you and I pay the rest. We need to shift this back to the State."
Craddick envisions a cap on taxes that could not be removed without voter approval.
A frustrated Texas Sen. Jeff Wentworth (R-San Antonio) suggested that the Texas Legislature had shirked its responsibility regarding school finance by deferring to the courts.
"The Legislature should have more backbone. We should exert leadership. Instead, we wait for someone to file a lawsuit and the Supreme Court has to tell us what to do. That way, if it's unpopular, you can say, 'the Court made me do it.' The Legislature should come up with a plan. The Senate did pass a complete revamping of school finance, which passed 31-0. It would have cut the local rate by 50 percent, dropping it from $1.50 to 75 cents. It would have raised the sales tax from 6.25 cents to 7.25 cents, and it would have taxed all services but medical. The House said they had run out of time for a hearing, that they would do it in special session. The Governor called us back in 2004, but you'll never get an agreement on it out of session. It took 12 years and four bills before we passed the one in the Texas Senate. It will not pass 31-0 again."
Wentworth said the proposed sales tax increase is the least objected to because people feel it is fair.
The Senate bill would tax services and service providers—legal, accounting, real estate, architectural, advertising, and engineering. These professions objected to the tax, but Wentworth pointed out that they would just be collectors of the tax. Just like retailers, their customers would actually be the ones to pay the tax.
"Fifty-two percent of our state's economy is service oriented," said Wentworth. "Only 20 percent are paying tax to do business in Texas. Big corporations avoid paying a tax, but it's legal. They are operating under the rules the legislature wrote by forming partnerships, while the smaller businesses foot the bill. We want to spread the bill from corporation over to partnerships. Naturally, those business aren't going to like it, but they've had the benefit of years of paying no tax at all."
Rep. Jim Pitts (R-Waxahachie), also a panelist, said getting lawmakers to come to a consensus on the issue of school finance in a special session is unrealistic.
"When 12 members of working groups can't even agree, a special session is not needed. The problem is, the working group has quit working, and we need to get back to work," he said.
Pitts noted that the 22 students to 1 teacher ratio required building more schools, which amounted to an unfunded mandate.
Wentworth said the Teachers Retirement System of Texas (TRS) reported record numbers of teachers retiring, which has also posed an additional challenge. He said a law in the U.S. Congress pertaining to Social Security caused the majority of the retirements.
"That has placed a huge strain on TRS. They had not anticipated that large a number of retirees," he said.
Beginning early in 2003, Grusendorf's committee talked to 500 to 600 school superintendents and administrators from the state's 1,038 independent school districts. He said it is imperative that the Legislature focus on how money is spent, and make the tough choices in order to get more efficiency from the $40 billion. Personnel issues, he said, are an area that deserves scrutiny. He used the example of the $1,000 pass-through insurance for school employees that was reduced to $500 last session due to the budget shortfall.
"School employees are not state employees. They are local employees, but we have put laws in place that make it difficult to fire a bad teacher, especially in an urban district. We must get a handle on school management—management responsibilities and control—if we're going to get efficiency in the dollars we spend in education. I think the state should fund school districts, but the decision of who gets the $1,000 or $500 should be a local school board decision," he said.
Grusendorf also pointed out that the educational delivery system must be updated to take advantage of technology. He said textbook adoption is the same as 60 years ago because current laws are based on doing business the old way.
Sen. Frank Madla (D-San Antonio), whose district encompasses some rural west Texas counties, worries about the future of education there.
"There are unique problems of teacher attraction and retention in Far West Texas, especially," Madla told TFB leaders.
