In response to the article (“Isle leaders worry tax cap might hamper growth, recovery,” The Daily News, Jan. 1): Texas’ school funding system is puzzling; this makes it hard to understand who pays what. Let’s unpack how the system works. In 1979, the state merged all property appraisals under one authority by creating central appraisal districts, or CADs.
The state comptroller was assigned as the governing agency of CADs, to be in control of every aspect of the appraisal process, including training CAD appraisers, training the appraisal review board and bi-annually auditing CADs.
Each year, the comptroller’s property tax division conducts property value studies sampling property sales in school districts. If CAD values are more than 5 percent below state values, then the CAD must use the state values and raise appraisals.
The study findings has another function. The amount of funding per student is basically a fixed amount; however, who pays is determined by a complicated formula that includes the number of students and things such as learning difficulties. The formulas haven’t been updated since 1993, despite more challenges facing school districts.
The system is designed so that when property values increase, the state share of funding is cut and local property owners must make up the difference.
Since 2009, the state has reduced its share of school funding from 48 percent to 37 percent, and is projected to drop to 35 percent in 2019.
From 2009 to 2020, the state will have shifted $14 billion dollars to the backs of local property owners. This frees up state money to be used on programs other than education.
In September, Mike Morath, Texas education commissioner, told state budget writers that property values for 2018 and 2019 are projected to increase 6.8 percent each year; this will allow the state to cut $3.7 billion of its share of school funding for 2018-19.
The state has a vested interest in keeping property values high, because when property values increase, the state’s share of school funding decreases, shifting this added tax responsibility to local property owners. A tax cap has no effect on this.
The current state budget has a 14 percent property tax revenue item, proving the state is heavily dependent on rising property values — even though a state property tax is unconstitutional.
This scheme has a terrific political advantage, making it particularly hard to figure out exactly who is raising the price of your house every year; slick isn’t it?
Robin Hood is a separate issue, but another drain on school districts. Taxpayers have sent more than $20 billion to recapture, an amount more than the lottery.
Just ask Galveston Independent School District, which will be sending almost $30 million to recapture even though the school district will have a $2 million dollar budget deficit. Galveston isn’t alone. Robin Hood is a giant sucking machine; Austin ISD this year will send $533 million to the state, more than being spent by the school district.
The state needs to stop blaming local elected officials for their failures and quit stealing local property revenue.