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Tex. Finance Ruling Angers Both Rich, Poor Districts

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The latest school-finance measure passed by Texas lawmakers deserves time to prove itself, a state judge has ruled.

Nevertheless, the decision last month by State District Judge F. Scott McCown is expected to send the issue back to the state supreme court, which since 1989 has overturned three finance laws.

Both wealthy and poor school districts have vowed to press separate appeals of the law, which seeks to reduce school-spending disparities by forcing affluent districts to transfer some of their taxable property wealth to poorer areas.

"We are extremely disappointed that the judge ruled a $600-per-pupil gap between the richest and poorest districts met the equity test of the supreme court,'' said Craig Foster, the executive director of the Equity Center, a coalition of districts with below-average wealth.

Others criticized the judge's observation that lawmakers had done the best job they could given the state's anti-tax political climate.

"That is not an excuse for unconstitutionality,'' argued Earl Luna, a Dallas lawyer representing several wealthy districts.

Lawmakers adopted the new funding system last year after voters rejected a constitutional amendment authorizing a statewide property tax. (See Education Week, June 9, 1993.)

Under the new law, districts with property wealth of more than $280,000 per student--about 100 of the state's 1,048 districts--are required to choose one of five ways to shed or share their wealth.

The poor districts complain that even after forcing the rich districts to assume a greater tax burden and share their wealth, the new law still leaves a per-pupil spending difference of $600 between the richest and poorest districts when they are both taxing at the maximum allowable rate.

But, Judge McCown wrote, "The $600 advantage about which plaintiffs complain is too small and enjoyed by too few for the court to say that it was unreasonable for the legislature to leave this gap.''

"The judiciary owes the legislature the respect of giving [the finance law] a chance to work,'' he added.

Facilities Funding Targeted

While state officials praised the ruling as a signal that Texas may soon be out from under the shadow of school-finance litigation, school administrators across the state said it was too early to put the issue to rest.

Even Judge McCown vowed to keep lawmakers on a short leash with respect to funding.

"Perhaps it will not work. Perhaps it will not be funded. But we cannot say today that it will not,'' the judge wrote, warning lawmakers not to allow the $600 difference to increase. "Given the progress that has been made in providing equity, further orders can await further developments.''

Judge McCown also ordered the legislature by next year to create an equitable system of funding school equipment and facilities, which are currently paid for locally on an unequalized basis. He threatened to halt school bonds if a plan is not passed.

Mr. Foster praised the call for equity in facilities funding, which poor districts long have sought. Still, he said, lawmakers should be directed to try again on the overall system.

Mr. Luna, the lawyer for the wealthy districts, agreed, predicting a more favorable hearing before the high court.

Judge McCown, on the other hand, said the unified chorus of critics against the law, known as Senate Bill 7, in some ways speaks for the new system.

"One measure of just how much progress is made under SB 7 is the ferociousness of the fight of the property-rich districts against it,'' he said.

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