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Published in Print: April 10, 1991, as Tex. Judge Gives Another Chance On Equity Order

Tex. Judge Gives Another Chance On Equity Order

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A Texas judge last week cut off state fund ing for the public schools and threatened to halt local spending as early as next Monday legislators do not produce an acceptable solution to the state's intractable education-finance dilemma.

Lawmakers, who were unable to agree on a finance-equity bill by the April 1 deadline set by the state supreme court, began a new round of discussions last week after District Judge Scott McCown froze about $2 billion in state school aid.

The shutoff of state funds essentially gave legislators two more weeks from that point to find a solution, since schools had by then already received their April state-aid checks. But as the legislature worked toward a solution that has eluded it over the past two years, Judge McCown ordered plans to be prepared for an alternate finance formula that observers said would, cost wealthy school districts "hundreds of millions of dollars."

The judge ordered a survey of the finances of each of the state's 1,052 school districts and appointed Lynn M. Moak, a deputy commissioner of the Texas Education Agency, to draw up a school-finance plan for the remainder of this year and next year based on existing school revenues.

The money would be collected by the state and distributed to districts based largely on their local tax rates--a severe blow to high-wealth areas, which can afford to tax their valuable property at low levels.

Judge McCown said that, in lieu of a finance plan, he will also rule April 15 on a request by poor school districts to cut off local spending until a new system is accepted, as well as on a state request for more time to draft a new formula.

By threatening to implement a draconian finance plan of its own, observers said the court might have provided enough motivation to force an agreement among lawmakers.

"He's hoping it will have the same effect the court master's plan had last summer," said Craig Foster, executive director of the Equity Center, an organization representing several poor districts. "He could have just said you can't spend any more local money as of today, but no one really wants to close down the schools."

The plan commissioned last year by the court would have reallocated $540 million in state aid and required 128 districts to raise $14.1 million in new taxes. Dallas schools, for example, would have lost $98 million under the formula. (See Education Week, June 13, 1990.)

The court's plan was considered a leading factor in persuading the legislature and then-Gov. William P. Clements Jr. to reach a finance agreement last year.

Analysts said the updated court plan could prove even more costly to wealthy districts because the supreme court, in striking down last year's legislative solution, set a higher equity standard than the court master had used.

For lawmakers, who have spent most of the last two legislative sessions toiling without success on school finance, last week's ruling offered another gasp. But there was no initial sign that the deadlock would be resolved.

Speaker of the House Gibson Lewis met with 28 Democrats who had voted against the most recent compromise, in hopes that the judge's opinion would persuade them to change their votes. "But the answer was pretty much a resounding no," said John Bender, Mr. Lewis's press secretary. After pronouncing the conference report dead, Mr. Lewis and Lieut. Gov. Bob Bullock began meetings aimed at writing an acceptable plan to present to a new group of conferees on Monday.

Officials said a variety of proposals were on the table, ranging from a plan to remove mineral and utility properties from local tax bases--a situation that currently provides windfalls to districts whose boundaries include oil facilities--to new versions of "taxing districts" that would fatten poor schools' budgets with money generated by nearby wealthy districts. Observers predicted that any eventual solution would probably require amending the constitution.

But some educators last week said they were unsure whether the legislature would be able to reach an acceptable compromise.

"The mood among legislators seems to be that they're willing to let the court take over," said Ollie Bestiero, president of the Texas State Teachers Association. "We would hope there's still some statesman ship left over there."

And just in case the matter is ultimately left up to Judge McCown, the Mexican American Legal Defense and Educational Fund last week filed a class action seeking to bring all of the state's school districts into the finance lawsuit in order to give each a chance for input and consultation should the court write a new finance plan.

Districts in Doubt

School officials, meanwhile, found themselves in the dark last week over how the finance issue would finally be resolved at a time when they are planning next year's budgets.

The Deer Park Independent School District near Houston notified 177 of its 750 certified employees that they would not be offered contracts because of the financial uncertainties within L the wealthy district. Lynn Hale, Deer Park's superintendent, said the April deadline has caused great anxiety over how the district will plan for next year.

"It's been an extremely difficult time because we're affecting so many people's lives," she said.

In several average-wealth districts, superintendents voiced concern that lawmakers might not be able to reach an agreement or that, if they do, it will not remove the disparities between wealthy and poor districts.

"The equity issue in this state is real, and our fear is that if they don't fix it and fix it right, we'll continue to feel the effects of a poor system," said Gene E. Davenport, superintendent of the Allen Independent School District near Dallas. "I think the greatest fear is that out of the duress of the court, something is going to be thrown together that may not be well thought out. We may get a Band-Aid one more time."

Vol. 10, Issue 29, Page 1, 19

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