After Huge Cuts in 2011, Education Faces a Funding Crisis in Texas

In Texas, state lawmakers tackled a flurry of education bills this session. They gave students relief from standardized testing mandates, proceeded with a plan to assign letter grades to schools (a move that was sharply criticized by educators), and directed focus to increasing the quality of preschool programs.

But lawmakers did little to resolve an education funding crisis that led more than 60 percent of school districts to sue the state.

In 2011, legislators cut a staggering $5.4 billion from spending on schools in an effort to balance the state’s budget. Felt across Texas, schools districts have been forced to reduce spending (suspending free bus services, enlarging classes, firing teachers, librarians, nurses, custodians, and other staff) or increase revenue (selling ad space on school websites or the sides of their existing buses).

Some officials may have seen this jam-packed legislative session, which ended June 1, as an opportunity for lawmakers to take action on pressing school finance needs. But those who had hoped to get some funding relief this session will now have to wait on the state Supreme Court to decide their fates — with the earliest possible ruling not expected until next year.

While legislators did approve a budget that allocated $1.5 billion to public education this session, school officials argue that this amount doesn’t go far enough in covering the $5.4 billion cut from this sector four years ago.

Historical Hurdles to Funding

After that 2011 vote, school groups representing hundreds of districts filed suit. Supporters of the cuts defended them — arguing they were necessary to help the state address a projected budget shortfall — but school district officials called them irresponsible, claiming that the new funding system was unconstitutional.

To manage the funding shortfall, school districts began making their own cuts: freezing hiring, shrinking staff through attrition, and reducing or eliminating programs seen as ancillary. Class sizes grew, as did the workloads of individual employees. Preschool programs in some school districts were truncated from full-day to half-day.

Lawmakers partially restored the funds to support staffing and programs, but a state district judge ruled in 2013 (and again last year) that the Texas funding system is inadequate and inequitable, and that it creates a de facto statewide tax that is unconstitutional.

The ruling, which was seen as a victory for school districts, was challenged by then-Attorney General (and now-Governor) Greg Abbott. Schools are waiting for the state Supreme Court to hear the case.

“The modest increase that we got this session will allow us to go a couple of years before we have to be dipping into the [school] fund balance to operate,” said Brian Woods, superintendent of the Northside Independent School District, the largest in San Antonio. “All it does is it pushes us out a few years; it’s hardly a long-term solution.”

State Senate and Courts Locked in Legislative Limbo

Albert Kauffman, a law professor at St. Mary’s University in San Antonio and the lead attorney in a previous school finance case, doesn’t think the additional funds that schools received are enough to “moot the lawsuit,” although the Supreme Court could remand the case back down to a district court.

When asked if school districts were in a kind of school funding purgatory, Kauffman chuckled.

“Purgatory is not a bad term; hell may be a term that they want to use,” he said recently. “I do think that these school groups tried very hard to get the legislature to take care of this, because ultimately it’s going to end up in the state legislature anyway.”

Kauffman noted that a court decision in favor of school districts would still put the choice back in lawmakers’ hands, since it would again be up to legislators to “create solutions.”

For those who have been following school finance for decades, the latest round of litigation represents another iteration of the same story, like a Texas two-step that school districts are tired of dancing. School finance litigation in the state dates back to the late 1960s.

Questionable Funding Formula

Wayne Pierce, executive director at the Equity Center (a school finance research and advocacy organization representing more than 700 school districts), has given expert testimony in the school finance case. In his testimony, he has explained that many of the state’s current problems come down to a bad funding formula.

“Our state funding system is based on two sources of money primarily — one of them being state funding, and the other being local property tax collection,” said Pierce. “The state system provides more funding to the districts with low property wealth because they raise so much less locally.” Despite this discrepancy, he went on to explain, the districts with less property wealth receive smaller amounts of funding than their richer counterparts. This inequality, Pierce argues, has “been perpetuated for decades.”

Alternate Routes to Increased Education Spending

House Public Education Chairman Jimmie Don Aycock proposed a bill to remedy the issue at the tail end of the legislative session. House Bill 1759 would have injected $3 billion into schools and changed some aspects of the state’s funding formulas.

The ambitious plan would have increased funding for 94 percent of Texas schools by raising the amount of the “basic allotment” awarded to each school.

But the popular lawmaker eventually took his bill off the table, noting that senate leaders were waiting for the state Supreme Court ruling to address funding. After the session, Aycock said that he also didn’t have the support he needed from school groups.

“I learned the hard way that it’s very hard to get varied interests to pull together on the school finance bill,” Aycock said recently, pointing out that every district is allied with its own advocacy group, many of which “pull in different directions.” He explained, “I knew that, but it’s more intense than I thought it would be.”

Aycock said he thought school groups missed an opportunity to come together around a bill that could have put more money into schools overall.

Back to the Drawing Board

But some argued that because the bill would have repealed a “cost-of-education index,” which gives schools extra money for low-income students and other factors considered outside the schools’ control (taking into account things like offering teachers competitive starting salaries). As a result of the proposed legislation, some campuses would have seen their state funding shares decrease as well.

“It had some good parts in it, and it raised the basic allotment, which is always a good thing, but it also repealed some of the cost-based funding formulas — costs that are beyond the control of the district,” Pierce said. “That was a major flaw in the bill. It had so many things that were good, but it didn’t address so [many] of the inequities that we have in our system.”

Constituents’ Interests or Partisanship

Monty Exter, a lobbyist with the Association of Texas Professional Educators, said that school finance bills, unlike general spending bills, don’t break down by political party.

“Everyone looks at their districts to see if it’s going to be a good bill for them, so it’s like you’re herding 180 cats,” Exter said.

School groups are required to file their legal briefs with the Texas Supreme Court by July 2. The state’s reply brief is due in early August. Oral arguments will be heard in November or December, and a Supreme Court ruling on the case is expected by spring 2016.

Follow this link to learn more about the campaign to improve early childhood education programming in Texas.