Legislative Update

May 23, 2019: The state’s top three leaders — Governor Greg Abbott, Lt. Governor Dan Patrick and House Speaker Dennis Bonnen — announced at a Thursday press conference that the House and Senate have reached agreement on major school finance legislation. Details have been slow to emerge so far, but the leaders said their plan would compress school property tax rates and put more dollars into public education.

What was the significance of Thursday’s press conference?
School finance has been the highest-profile issue of the legislative session, but the House and Senate passed very different plans to deal with the issue. A conference committee of five senators and five members of the House has been working on a final bill. The point of Thursday’s press conference was to announce that those legislators, along with the Governor and the presiding officers of the House and Senate, had agreed on a final bill to present to the full House and Senate for approval.

How much time do they have to approve it?
The legislative session ends on Memorial Day. If the leaders’ plans stay on track, which is likely, the House and Senate will give final approval to the school finance legislation this weekend.

What will this final agreement mean?
The final bill has not been released to the public in its entirety. We do know that this bill puts more state dollars into public education, it provides some funding for educator pay raises, and it puts new limits on school property tax rates.

What does this mean for GCISD?
It’s too soon to tell. The impact on GCISD will become more clear as the specific changes to funding calculations are released.

May 7, 2019: Three weeks remain in this year’s session of the Texas Legislature. The Texas House and Senate have now both approved school finance legislation, but their bills differ in important ways. Those differences need to be resolved before the legislative session ends May 27.

What happened Monday and where does the Legislature go from here?
The Texas Senate approved its version of the House Bill 3 school finance bill on Monday. Now the House and Senate have passed different versions of the legislation. The likely next step is that each chamber will name five members to sit on a conference committee to negotiate a final version of the bill. That final bill would have to be approved by the members of the House and Senate before it could be sent to the Governor for approval.

How are the bills passed by the House and Senate similar?
Both bills increase state funding for public education, reduce property tax rates and reduce Robin Hood statewide. The bills also increase funding for full-day pre-kindergarten for eligible students and make a number of similar changes to the formulas that determine how much money each individual school district receives from the state.

How are the bills passed by the House and Senate different?
A major difference is compensation. The Senate bill mandates a $5,000 across-the-board pay raise for classroom teachers and librarians only. Classroom teacher is defined as an individual who (1) is a teacher of record who teaches at least half the average number of students for a teaching assignment at the school campus at which the teacher is employed; and (2) satisfies the amount of teaching time requirement in the definition of a classroom teacher under Section 5.001 by providing educator leadership, including collaborating with, mentoring, or supporting other teachers.

The House bill requires using 25% of the increase in funding for pay raises for teachers and librarians, but also other school district employees, such as counselors, nurses, bus drivers, cafeteria staff and custodial staff. The House bill would give local school districts more flexibility in deciding how to distribute dollars for pay raises. The Senate bill also calls for a reduction in school district tax rates of 10 cents per $100 property valuation. The House bill calls for a reduction of 4 cents per $100 property valuation.

What does this mean for GCISD?
Broadly speaking, both chambers of the Legislature have now approved bills that would put more state dollars into public education and reduce the system’s reliance on property taxes. As a result, it’s likely that Robin Hood will be reduced. We will not know exactly how much GCISD’s Robin Hood payments would decrease until we see a final bill from the legislature.

April 26, 2019: There is only one month left in this year’s session of the Texas Legislature and just about every major issue remains unresolved. That’s not unusual for this point in the session, but it does mean there will be a lot to watch in the next four weeks. Many of the highest-profile issues yet to be resolved focus on education, school funding and property taxes.

What happened on the issue of school finance this week?
On Thursday, Senate Education Committee Chairman Larry Taylor unveiled his long-awaited version of House Bill 3, the major school finance bill this session. The House passed its version of House Bill 3 in early April, but since a bill must pass both the House and Senate before it becomes law, the Senate’s version of House Bill 3 has been eagerly anticipated.

How is the Senate proposal different from what the House already approved?
The Senate proposal differs from the House-approved bill in many important ways. For starters, it includes an across-the-board $5,000 pay raise for teachers and school librarians. The House bill provides funding for employee pay raises but gives school districts more discretion in deciding how to distribute those raises. The Senate bill goes further in tying a school’s funding to student performance on standardized tests. The House bill would allow a couple more “golden pennies.” Those are pennies on the tax rate that districts like GCISD do not have to send to the state through Robin Hood.

How is the Senate proposal similar to what the House already approved?
Both bills carry a total price tag of about $9 billion, including the money that would be used to reduce property tax rates. Both bills also reduce the amount of money that the state takes away from districts such as GCISD through Robin Hood, although it is not yet clear how much GCISD’s Robin Hood payment would decrease under the Senate plan. Both plans fund full-day prekindergarten for students from low-income families.

Is there a consensus on property-tax reform?
We know that property-tax reform, broadly speaking, is a goal for both the House and Senate. But a myriad of ideas have been introduced in one chamber or the other. Both sides propose making some reduction in school district tax rates. Beyond that, there are a number of other ideas on the table. It’s not at all clear which ideas will stick.

What happens next?
Senator Taylor told reporters that he hopes his committee will approve his bill the week of April 29. It would then go before the full Senate. Right now, it appears that a small group of legislators from the House and Senate will be meeting in the session’s final three weeks in an effort to agree on a final version of the school finance legislation.

April 19, 2019: The Texas Legislature will hit the ground running after the Easter Weekend, with only five weeks left before the legislative session ends May 27. At this point, there are a lot of competing ideas and moving parts that would directly affect education and property taxes in GCISD across the state. Below is a look at some key questions moving forward.

What would happen if the State traded lower property taxes for a higher sales tax?
Earlier this week in the House Committee on Ways & Means, House Public Education Committee Chairman Dan Huberty presented House Joint Resolution 3. This is the plan to increase the state sales tax by one penny. The change to the sales tax in HJR 3 is expected to generate about $5 billion per year for property-tax relief and education, and as much as $6 billion per year by 2025.

How would the money from the higher sales tax be spent?
Most of the money the state would collect from the higher tax (80 percent) would go toward lowering property taxes, while 20 percent would go toward funding education. And since there is less reliance on property taxes when the state puts more money into public schools, it’s fair to say that all of the money generated by the sales tax increase would go toward lower property taxes and less Robin Hood.

How would the tax swap affect Robin Hood payments statewide?
If this swap of higher sales taxes for lower property taxes is approved in the form that Chairman Huberty has laid out, it could have a very big impact on school funding and Robin Hood statewide. Consider: The House recently approved House Bill 3, which would reduce Robin Hood payments statewide by $3 billion over two years. If HJR 3 is also approved and enacted into law, Robin Hood payments would decrease by $5 billion over two years. School districts would also be able to reduce their tax rates much more than HB 3 allows.

This would be a very big shift in state tax policy. How likely is it to become law?
The proposal to trade higher sales taxes for lower property taxes has a long way to go: It would need support from two-thirds of the House and Senate, and then a vote from the public because it has been proposed as an amendment to the Texas Constitution.

The House has passed a school finance bill. What about the Senate?
The Texas House has already passed House Bill 3 — the bill that puts billions of new dollars into public education and reduces Robin Hood statewide. The Senate Committee on Education is expected to unveil its version of that bill in the next week. There are expected to be differences; if nothing else, the Senate has been pushing for a $5,000 across-the-board increase for teachers and librarians, while the House version calls for pay increases, but gives school districts more flexibility over how to administer them. Once the Senate approves a school finance bill, a few members of the House and Senate will likely meet in a conference committee to come up with a final version of the bill.

Will there be a new cap on school district tax rates?
The Texas Senate passed a bill earlier this week that puts a new 3.5 percent limit on the amount of property-tax revenue a city or county or other local jurisdiction can raise per year before a local election is forced. Senators decided to apply an even lower cap — 2.5 percent — on school districts.

Right now, school districts cannot raise tax rates more than 4 cents without a vote of the people. This legislation would, therefore, subject school districts to an entirely new type of limit.

The House is expected to debate caps on local tax rates in the coming week. Right now, the House proposal does not address school district tax rates because the House already lowers school tax rates in its comprehensive school finance legislation (House Bill 3). If the House continues to keep school districts out of the bill, that will be a major point of negotiation between the House and Senate in the final month of the legislative session.

April 12, 2019: A little more than six weeks remain in this year's regular session of the Texas Legislature. The House and Senate are voting on more and more bills and committees are meeting long into the night. Here's a look at what happened this week on a few key issues that affect GCISD...

Senate Budget Puts More Dollars Into Schools
The Texas Senate gave unanimous approval to a proposed two-year state budget on Wednesday. The House and Senate have now both passed budget proposals. A small group of members from each chamber will soon begin meeting in a conference committee to hammer out a final budget plan that both the House and Senate can consider before the legislative session ends May 27.

The House and Senate budgets have a lot of differences, but they are similar when it comes to the big-picture numbers for public education: Each budget proposes putting more than $6 billion in additional funding into schools and using almost $3 billion to reduce school property taxes. The direct impact on GCISD schools and taxpayers will be determined in large part by other legislation. But, generally speaking, the Legislature is aligned on putting more State resources into public education, which could reduce the State's reliance on Robin Hood and keep more GCISD taxpayer dollars in our community.

Different Approaches on School Finance and Teacher Pay
There has not been a lot of movement on school finance bills in the last week. Here's where things continue to stand: The Senate has approved a bill (Senate Bill 3) to give every teacher and school librarian a $5,000 pay raise. The House has not yet acted on that bill. The House has approved a more comprehensive overhaul of the school finance system (House Bill 3), including a requirement that schools spend some of their additional state funding on pay raises for teachers and other employees. The Senate has not yet voted on its full school finance reform bill.

State Leaders Offer New Plan to Reduce Property Taxes
Governor Greg Abbott, Lieutenant Governor Dan Patrick, and House Speaker Dennis Bonnen issued a joint statement Wednesday introducing a new element into the debate over property tax relief: They said that, if the House and Senate agree to and pass priority legislation that aims to limit increases in local property taxes, they will introduce a proposal to increase the state sales tax 1 cent in order to further reduce property tax rates. "If the one-cent increase in the sales tax passes, it will result in billions of dollars in revenue to help drive down property taxes in the short and long term," the three leaders said in their joint statement. We don't yet know what this will mean for GCISD. But a further reduction in school property taxes in exchange for a higher state sales tax has the potential to further reduce the amount of money that GCISD and other school districts are required to send to the state through Robin Hood.