Published Online: February 1, 2005
Published in Print: February 2, 2005, as Texas

State of the States

Texas

Gov. Perry Outlines Agenda for Texas

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While the Texas legislature considers dramatic changes to the state’s school finance system, Gov. Rick Perry wants it to also add a host of incentives and programs to improve the quality of schools.

“It is a once-in-a-generation opportunity to make sure children of every background are given a chance in life,” the Republican said of the school finance debate during his Jan. 26 State of the State Address.

Mr. Perry’s proposals include vouchers, higher salaries to attract the best teachers to schools where they’re most needed, and financial incentives for districts to raise high school achievement.

But the biggest issue facing the governor and legislators is overhauling the state’s convoluted finance system, in which wealthy districts supplement the budgets of poor ones. Last year, a district court judge declared that the so-called Robin Hood program failed to meet the state’s guarantee of “an adequate suitable education.” ("Texas Judge Rules Funds Not Enough," Sept. 22, 2004.)

In his speech, Mr. Perry endorsed legislators’ proposal for what he called “a broad-based business tax that is fairly distributed, assessed at a low rate, and reflects our modern economy.”

Under a plan promoted by Lt. Gov. David Dewhurst, who is the president of the state Senate, Texas would create such a tax. The plan also would create a statewide property tax of $1 for every $100 of assessed value. That’s 50 cents lower than the current maximum amount districts are allowed to assess under the state’s school funding formula.

For More Info
Read the text of Mr. Perry's address.

The plan would also raise the state sales tax, while applying it to several services currently exempt. The plan would add $6.7 billion to the $13.7 billion the state currently spends on schools.

Mr. Perry and other legislative leaders have endorsed the plan. In his speech, Mr. Perry also proposed to cap municipalities’ property appraisals to annual increases of 3 percent.

While lawmakers agree on a road map to fixing the problem, they say there will be a debate over exactly what businesses will be taxed and at what levels.

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Mr. Perry’s speech didn’t provide all the details for his plans, either. For example, he mentioned state-funded vouchers for students to attend private schools in passing, but did not explain how the program would work.

He also referred to financial incentives for districts to help ensure that high school students pass end-of-course exams in core subjects. But he didn’t say how much those payments would be.

Last year, he proposed payments of $1,100 to districts for every student who graduates after completing a rigorous course of study. The payments would be twice that for every student considered to be at risk of failure. ("Texas Governor Unveils School Funding Plan," April 14, 2004.)

School groups say those incentives would be fair only if the state’s basic grants under a school finance formula provide adequate funding for all schools.

“A lot of people call this frosting, but we haven’t baked the cake yet,” said Cathy Douglass, the associate executive director for government relations for the Texas Association of School Boards.

Among Mr. Perry’s other proposals are plans to:

• Pay $7,500 a year more to teachers working in schools with the lowest student achievement;

• Create “turn-around teams” in the Texas Education Agency that will help failing schools improve their management and instruction; and

• Require districts to publish financial statements that detail how much money is spent on instruction and how much on administration.

Vol. 24, Issue 21, Page 26

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