Analysis: Spinning numbers in Texas lawmakers’ proposed budgets

By Ross Ramsey

If it’s hard to tell good news from bad in the Texas Legislature’s proposed budgets, it’s because these political people are very good at putting the best face on ugly facts.

Look at the public education numbers. The House wants to spend $42 billion in 2018-19, up from $41.6 billion in the current budget. The Senate wants to spend $40.5 billion, or about a billion less than the current budget.

The Senate emphasizes its inclusion of enough money to cover the costs of the estimated 82,000 to 83,000 new students added to the state’s classroom rosters every year. That’s truthful, too, but masks that $1 billion cut in the upper chamber’s proposed state funding for public schools.

The House suggests its proposed budget for public education would provide indirect property tax relief, which is technically correct, but a bit misleading.

Nobody’s lying — they’re just putting their emphasis where they look best. Those Senate numbers might sound like something from Alice in Wonderland, where things can be down and up all at once, but they’re explained in the detailed summary delivered with the Senate budget: “This funding includes an estimated $1.5 billion increase in Other Funds, attributable to projected increases in revenues from the Property Tax Relief Fund and from recapture payments, and a corresponding decrease in General Revenue Funds.”

Translation: Property values are rising, and the resulting increases in local school property tax revenues and in money paid to the state by property-rich districts will cover the costs of growth — even as the state cuts what it spends on schools.

You can forgive your local school board members for smacking their foreheads: This budget proposal comes from some of the same legislators who have been railing against rising local property taxes and promising voters the remedy is to harness spendthrift local governments.

Recapture is a related hot button: It’s the technical term for what voters know as the "Robin Hood" school finance system, where districts with more valuable property send some of their money to the state for use in districts where the property is worth less. As the state’s share of public education spending goes down, the need for higher property taxes and larger recapture payments goes up.

In the House’s case, that indirect property tax relief would result from the state taking less advantage of those property tax and recapture increases. The House would increase state spending on public education by $1.5 billion — money that under current law would be paid by local school districts.

The Senate would leave things as they are, which benefits the state when property values are rising, as they are right now. The House would raise state spending “contingent on enactment of legislation to reform the school finance system in a manner that improves equity, reduces recapture, and increases the state share of the [Foundation School Program].”

That House plan could actually buttress the Senate’s efforts to fight increases in local property taxes, if the Senate will go along with it. But the state can’t force local districts to lower their property tax rates, so you might never see the benefits even if pressure on local schools is eased.

Both of the proposed budgets rely on the expiration of a $600 million legacy of previous school finance redesigns. When lawmakers have rebalanced school finances, trying to make sure poor schools get enough money to do their jobs, they’ve included “hold harmless” provisions that protect other districts from losing money in the rebalancing. The idea is that some districts get more money, but no districts are harmed.

Those provisions — the unwieldy official name is Additional State Aid for Tax Reduction, or ASATR — expire in September. That would save the state $600 million, but only because it costs school districts the same amount.

Expect a fight — followed by an official explanation that follows the public relations advice put to music by Johnny Mercer and Harold Arlen:  “You've got to accentuate the positive / Eliminate the negative / Latch on to the affirmative / Don't mess with Mister In-Between.”

This article originally appeared in The Texas Tribune.

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