Education Funding

Kansas, Texas Face School Finance Deadlines

By David J. Hoff — May 09, 2006 4 min read

Facing court deadlines to fix the way they finance their public schools, lawmakers in Kansas and Texas have been wrangling over possible solutions.

Kansas legislators have considered plans that would increase state aid for K-12 education by 15 percent or more over the next three school years.

But the question remains: Would that be enough to satisfy the state’s highest court?

Probably not, say the plaintiffs in the state’s 7-year-old school finance lawsuit.

“The dollars keep shrinking because it is an election year,” said Alan L. Rupe, the Wichita lawyer representing the plaintiffs in the case. “Everybody’s cutting the loaf in half and going in the wrong direction.” But legislators believe that the court would approve a plan that phased in over three years an increase of $450 million for schools, even though a study conducted by legislative staff members estimated that schools need a $400 million boost for the 2006-07 academic year alone.

“It’s a three-year plan to show a commitment to education and help school districts to plan for the increases,” said state Sen. Jean Schodorf, a member of the House-Senate conference committee negotiating the final school finance budget. “If it’s a well-thought-out plan, we believe the court would accept it.”

Slow Progress

Late last week, the conference committee considered plans that would increase K-12 financing by around $450 million from its current level of $2.7 billion. Ms. Schodorf said she expected the committee to work through the weekend trying to craft a plan that would pass both chambers.

The legislature has struggled to comply with the Kansas Supreme Court’s 2005 ruling that the state’s financing of schools is inadequate. In that unanimous decision, the court cited a 2001 study saying the state needed to spend an additional $800 million to meet the state constitution’s guarantee of a “suitable” education.

After the legislature appropriated a $143 million increase for schools in its regular session last year, the court threatened to shut down schools if the legislature didn’t provide additional money. Once lawmakers appropriated an extra $148 million during a special session, the high court gave them until the end of this year’s legislative session to re-evaluate the study and come up with a plan to finance it. (“Kan. Lawmakers Agree on Spending Plan,” July 13, 2005)

That study, conducted by the state Legislative Post Audit Committee, said schools would need an additional $400 million for 2006-07 school year to help students meet the state’s standards.

In the conference committee, legislators were considering a Senate plan to increase school spending by $468 million over three years. In March, the House passed a 3-year, $558 million plan, but the Republican majority’s appointees to the committee weren’t supporting it.

On May 2, the Kansas House voted 63-62 to renew that plan, which is being supported by a coalition of moderate Republicans and Democrats. By that evening, the House had approved an amendment, supported by the House leadership, to cut back the increase to $460 million when one member switched her vote .

The next day, House members defeated that bill after members said its total cost was too expensive. Legislative leaders decided to proceed with the conference committee in the hope of crafting a plan that could eventually pass the House.

“That $558 million House bill comes within the ballpark,” said Mr. Rupe, the plaintiffs’ lawyer. “If that passes, we’re going to take a real serious look at where the money was spent.”

But if the state enacts a bill that would increase spending by $450 million, he added, “we’ll probably fire up a brief and go to court.”

The plaintiffs would consider asking the court to shut down schools or impose fines on the legislature for failing to comply with the court orders, he said.

Gov. Kathleen Sebelieus, a Democrat, has said she would back a bill that provided a $500 million increase over the next three years, said Nicole Corcoran, a spokeswoman for the governor.

Texas Taxes

While Kansas lawmakers continued to struggle last week, Texas legislators have made significant progress in their special session, which was called to comply with a state supreme court order to overhaul the tax system.

Last year, the Texas Supreme Court said that the state spent an adequate amount on schools, but that its cap on property taxes violated a constitutional provision prohibiting a statewide property tax. (“Texas School Finance Ruling Draws National Attention,” Dec. 7, 2005)

As of last week, both chambers of the Texas legislature had passed tax bills that would reduce property taxes by a third and replace part of the lost revenue with higher levies on businesses, cigarettes, and cars.

The plans are similar to the one proposed by the Texas Tax Reform Commission, a blue-ribbon panel appointed by Gov. Rick Perry, a Republican, to propose changes in the tax structure. Mr. Perry then proposed that the legislature adopt that panel’s recommendations.

Lawmakers have made more headway in the current special session toward rewriting the way Texas finances its schools than they did in two special sessions last summer. But the debate hasn’t been without political overtones in this gubernatorial-election year, in which Gov. Perry is seeking his second full term.

Texas Comptroller Carole Keeton Strayhorn, an Independent candidate running for governor in November, said that Mr. Perry’s plan would leave a “gaping hole” in the state budget by using surplus funds to pay for the first year of the plan. Ms. Strayhorn also calls the corporate tax “a tax on the privilege of doing business in Texas.”

John Sharp, the chairman of Mr. Perry’s commission and a former Democratic state comptroller, called Ms. Strayhorn’s criticisms “a rehash of the criticism leveled by the big law firms who want to avoid paying franchise taxes.”

Texas has until June 1 to comply with the supreme court’s order.

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A version of this article appeared in the May 10, 2006 edition of Education Week as Kansas, Texas Face School Finance Deadlines

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