Tex. Voters Next To Decide Finance Amendment's Fate

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The Texas legislature has taken a major step toward resolving the state's intractable school-finance battle by approving a constitutional amendment allowing the state to take money from wealthy school districts and distribute it among poorer ones.

The amendment passed by lawmakers this month must still be approved by voters, however, and some observers are already predicting the public may not be willing to go along.

The stakes are high because a state judge has vowed to shut off state funding to Texas schools on June 1 if a new system is not in place. Many lawmakers who voted for the amendment said they did so only because they were facing a deadline to get the measure on the May 1 statewide ballot.

The amendment will go before voters at the same time as what is expected to be a heated special election for the U.S. Senate seat vacated by Secretary of the Treasury Lloyd Bentsen.

Before the measure makes it to the public, moreover, lawmakers must draft legislation showing how local property-tax funds would be reshuffled if the amendment is passed. An even more contentious task may be to write a budget for the next two years setting the level of education aid in the midst of a large state-revenue shortfall.

While observers of the school-finance saga have been focusing on the constitutional amendment, they admitted last week that it may have been the easiest part of the legislature's work.

"For a while this was in serious doubt, even though they were coming up to the deadline and knew they had to do something to keep the schools open,'' said Craig Foster, the executive director of the Equity Center, a coalition of property-poor school districts. "In the end, they knew if they did not act, the eyes of the rest of the country, if not the whole Western world, would have been on us.''

Narrow House Victory

The key legislative arena for the proposed amendment was the House, which in a fall special session had not been able to agree on a school-finance solution.

Under the amendment, the state would be allowed to redistribute up to 2.75 percent of state and local school funds, taking the bulk of the money from a few extremely wealthy suburban districts.

The amendment would lead to the redistribution of about $400 million in local aid.

Legislative leaders were able to win enough Republican votes to pass the plan after agreeing to a separate constitutional amendment that would grant localities flexibility when the state mandates services without providing accompanying funds.

Democratic leaders were able, however, to turn back efforts to attach amendments ranging from vouchers for private schools to setting a limit on tax increases for schools.

The amendment passed the chamber on a 102-to-43 vote, two more than the required two-thirds majority.

The Senate on a 27-to-4 vote then agreed to accept the hard-won House compromise, thus avoiding reopening the debate in a joint conference committee.

Mr. Foster said that while the amendment was only a modest step toward equity, it did address an issue raised in the three separate rulings in which the state supreme court struck down the state's school-funding approach.

"The court said we have to have 'recapture' and this is the only way to do it short of consolidation,'' he said. "It does the things we need to do to proceed.''

Analysts said a much larger amount of state funding will be required to significantly boost the spending power of poor districts. But that issue can only be resolved as part of the larger budget debate, which observers expect lawmakers to put off until near the end of the current legislative session, or perhaps until a special summer session.

Hammering Out the Details

In the meantime, members of the legislature must hammer out a plan for redistribution that voters will consider as they vote for the constitutional amendment.

Lawmakers could opt for continuation of the county-based education districts established in their most recent school-finance plan. Those regional authorities collect a state-ordered level of property taxes and then redistribute the aid to local school districts. Or they could move to either a straight county-by-county redistribution scheme or a statewide collection and distribution plan.

House education aides said last week that both the timing and the substance of the recapture plan remained undecided. That was both because lawmakers were weary of school-finance issues and because any computer projections of funding under a new plan would show all districts losing money, given the grim overall fiscal situation.

Leaders of the House and Senate education committees were expected to meet late last week to begin chipping away at such issues.

Vol. 12, Issue 22

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