May 06, 2006
Bills pass amid Senate walkout

We've been busy around the house today so I'm a little short on time, but there was some excitement in the State Senate yesterday around HB1. Here's the Chron story:

Tempers flared and several senators walked out in a dispute over how to fund the public schools, but legislation cutting school property taxes, raising teacher pay and making other educational improvements won the key approval of the Senate Finance Committee on Friday.

The panel then approved a $1-per-pack increase in the cigarette tax, part of a package backed by Gov. Rick Perry to replace the lost property tax revenue.

Both measures now head to the Senate floor, where Education Chairwoman Florence Shapiro, R-Plano, vowed to continue the fight she lost in the committee over House Bill 1, the wide-ranging school bill.

"It's not over," she said, announcing she had enough votes to block further debate on the measure, which she was sponsoring but which was hijacked by several Republican and Democratic senators who amended it over her objections.


Led by Sens. Robert Duncan, R-Lubbock, and Todd Staples, R-Palestine, the committee voted to redistribute about $300 million in HB1 to improve funding equity among school districts and allow some property wealthy districts to raise additional local taxes they wouldn't have to share with poorer schools.

The money is part of about $500 million that Shapiro wanted to distribute among high schools for dropout prevention and college preparedness programs.

On Friday morning, Shapiro attempted to head off the amendment by calling for a vote, but Ogden refused to recognize her motion.

She then walked out of the committee room, followed by five other Republicans — Kyle Janek of Houston, Tommy Williams of The Woodlands, Jane Nelson of Lewisville, Bob Deuell of Greenville and Kim Brimer of Fort Worth.

The walkout didn't break a quorum, and the remaining committee members continued working before taking a long lunch break. After lunch, all the senators returned, except Nelson, who had a previously scheduled conflict.

"The solutions being offered by some of my colleagues can best be described as a bridge to nowhere," Shapiro said of the funding change. "They are setting bad fiscal policy for our state that benefits some schools while hurting others."

She also said the provision would doom the bill's chances in the House. She and Lt. Gov. David Dewhurst have been negotiating with House members on other educational issues, including a $2,000-a-year teacher pay raise, which also is in the measure.

But Staples said the amendment was fair and a step toward reducing the effects of the controversial "Robin Hood" share-the-wealth school finance law.

The committee added another amendment, offered by Williams, that would reduce the school operating tax rate by 50 cents per $100 of property value by the fall of 2007, the goal set by the governor. For most school districts, that would amount to a reduction of about one-third.

School taxes would be cut by 17 cents per $100 this fall.

In order to make up for the 50-cent cut, the state would need $2.5 billion in addition to the revenue raised through the higher cigarette tax, an expanded business tax already sent to the governor and tightened sales tax collections on used cars.

The state has an $8.2 billion surplus now, but Dewhurst, among others, is concerned that will soon evaporate among a host of needs.

But Williams said there is "plenty of money available for us to fund this tax relief."

The committee approved HB1 on a 9-2 vote with three abstentions, including Shapiro.

I'll point you again to the CPPP's analysis of the Williams amendment. They are deeply concerned that it will require a 16% cut in spending on other state services due to a constitutional cap. Given that services were already cut pretty deeply in 2003 when we were in deficit mode, the prospect is not a happy one to contemplate. I feel that there may be an interpretation question within that, however. I'm trying to solicit some reactions to their work to see how alarmed I should be.

One place where there was some Democratic reaction to all this was the Express News.

Today's system creates equitable funding for a little more than 70 percent of the state's 4.4 million public school children. The new Senate proposal would create up to 96 percent equity in a new "enrichment tier" that would allow school districts to levy extra taxes beyond what is necessary for a basic education.

But doing so would harm the state's 170 property-wealthy school districts, Shapiro said, and force many to increase taxes to gain additional funds in the so-called "enrichment tier."

Duncan warned that without changing the equity standard, property-rich schools would gain so much financial advantage "that the disparity would shock the conscience."

Shapiro complained bitterly about the efforts to change equity and said the Supreme Court didn't rule on that issue.

"This is the premier 'light your hair on fire' issue," she said. "It causes all of us to fight among ourselves."

But Sen. Leticia Van de Putte, D-San Antonio, said lawmakers have been laboring for years "to make sure that all children are treated equally in a school finance system."

She downplayed concerns that rich school districts would have to raise tax rates before enjoying additional "enrichment" funds, which, unlike other revenue, they would not have to share with poor schools.

Poor school districts already levy higher tax rates, Van de Putte said. "Why shouldn't it be required of property-wealthy school districts?"

Only one of the 16 school districts in Bexar County (Alamo Heights, the West University Place of San Antonio) counts as property-wealthy, so you can see where Van de Putte is coming from. The Brownsville Herald has more.

State Sen. Juan "Chuy" Hinojosa, D-McAllen, voted for the bill.

"It's a great step," Hinojosa said. "We need equity in our public school system. ... We couldn't ask for anything more."

Thanks to South Texas Chisme for that link. The Morning News notes that this amendment would prevent the Dallas ISD from losing money to Robin Hood. According to the Statesman, four Republicans and five Democrats voted for this change.

The Williams amendment aside, I have to say this doesn't sound too bad to me. Of course, Shapiro isn't going to give up, and she says she's got the votes to block the bill from coming to the floor. Monday is going to be a fun day in the Capitol. May 16 is the end date for this special session, so there's still time to work things out, which Lt. Gov. Dewhurst sees as a double-edged sword.

Other activity: A modified version of HB5, the cigarette tax bill, passed by a 9-5 vote, with mostly Dems voting no. The House rejected the Senate's version of HB2, which allowed some business tax money to go to schools after property taxes hit a certain level, on a point of order. Dallas Blog has a timeline of events. As always, stay tuned for more.

Posted by Charles Kuffner on May 06, 2006 to Budget ballyhoo | TrackBack

There's two problems: The constitutional cap on spending limits how fast the budget can grow; the Williams Amendment says that $6 billion of the amount permitted by the cap has to go to replace school property taxes. So that's $6 billion we don't have to spend on other things.

So: you could raise the cap to take into account this new role for the state as major funder of public schools (compared to its current role as paying only one-third of the cost), so that you could both cut property taxes (if you have the money -- another issue)and have a reasonable state budget, or you could decide that it's not worth wrecking the state budget to get school property taxes down to $1.00.

Or you could even try paying teachers a decent salary, improving the schools, and stop our slide into Third Worldism.

Posted by: Dr. No on May 7, 2006 12:10 AM