Some small schools facing a fiscal cliff

AUSTIN — The Texas House last week voted to fund about $1.8 billion for public education, but Senate Republicans on Tuesday instead talked up a proposal to study school finance instead of providing more funds now.

Speaking at a Capitol press conference, state Sen. Larry Taylor, R-Friendswood, said “some people’s idea of reform is simply to spend more money on education” and compared Texas’ school-finance system to an aging vehicle, saying “it’s time to start shopping for that new car.”

Taylor chairs the Senate’s education committee and wants to form a commission to develop recommendations on improving school finance.

But as the special legislative session moves toward an Aug. 18 end date and House proposals to send schools money await their fate in the Senate, some rural-school leaders say they’re dangling over a Sept. 1 fiscal cliff.

That’s when Additional State Aid for Tax Reduction — ASATR — is set to end, and the House last week voted down House Bill 22, which would have extended that financial lifeline for two years.

“Districts have known for six years that it was going to go away,” said Ray Freeman, executive director of the Equity Center, an Austin-based school finance research and advocacy organization. “The truth is, they were funded at a higher level for six years than the formula provides.”

While experts debate the equity of ending ASATR, the net effect of turning off the aid, is that “there are about 10 districts out there that won’t be able to stay open,” said Don Rogers, executive director at Texas Rural Education Association.

The Fort Elliott Consolidated School District, based in the Texas Panhandle city of Briscoe, may well be among them.

The district has about 140 students, covers some 500 square miles in the Texas Panhandle and graduated 16 seniors last spring.

Frank Belcher, Fort Elliott’s superintendent, said that since the end of the last school year the district has consolidated classes to cut transportation and cafeteria costs and reduced staff by five positions.

Belcher said that without ASATR, the district could have just three or four years of life. 

With roughly 860 students, the Canadian ISD is bigger than its Panhandle neighbor, but Superintendent Kyle Lynch said folks are facing similar issues.

For the Canadian district, ASATR represents about 30 percent of the budget. 

“If I could tax my way out of it, I think my community would, but we don’t have the capacity,” Lynch said. “Lots of people are realizing that this is a big deal.”

The House proposal to add money to school funding for the coming biennium, House Bill 21, was referred to a Senate committee on Tuesday. 

While not as generous as the failed ASATR extension, Belcher said HB 21 could restore “maybe half” of the ASATR money.

But Rogers, with the Texas Rural Education Association, said he “wouldn’t bet a nickel” on HB 21’s chances in the Senate.

Meanwhile, Chandra Villanueva, a school finance and education policy senior analyst at the Center for Public Policy Priorities in Austin, doesn’t support extending ASATR.

But even if HB 21 passes, it’s only $1.8 billion, not the $2.7 billion needed “just to keep pace with inflation,” Villanueva said. 

“Our problem isn’t the (school funding) formula as much as the fact that we don’t put any money behind it,” Villanueva said. “The solutions are out there but they cost billions.

Expanding the sales tax, for example, is one possible solution. 

“There are a lot of things the state could do to shore up,” funding, Villanueva said. “You’ve got to keep all the options on the table.

“We’ve got 5.3 million kids in public schools. Tax cuts aren’t going to educate them.”

John Austin covers the Texas Statehouse for CNHI’s newspapers and websites. Reach him at jaustin@cnhi.com.