By Jennifer Nagorka, KERA 90.1 commentator
Dallas, TX – Governor Rick Perry's new plan for funding public schools is underwhelming at best. It doesn't bring enough truly new money into the system. It offers only limited property tax relief. It relies on gimmicks. It is a small answer to a huge problem.
The problem has been simmering for more than a decade. Under the current funding system, known as Robin Hood, property-wealthy districts must send some of their tax revenues to the state or to poorer districts. The law also bars local school districts from charging more than $1.50 in tax for each $100 of property value. Every year, more districts bump up against the cap. Some school systems are cutting programs even as they send millions of dollars in local revenue to less affluent districts.
Legislators have seen this crisis looming for years and, for the most part, responded by studying the issue again and again and again. Governor Perry deserves some credit for at least offering a plan.
Distilled down, the governor's plan has two major parts. He wants to split the property tax base. Homeowners' taxes would still be collected and used locally. Commercial property, however, would be collected and distributed at the state level. Business groups don't like this measure, because they fear they'd be an easy target for property tax increases and wind up bearing more of the tax burden. And while this change might solve the steal-from-the-rich-and-give-to-the-poor quality that Robin Hood's detractors so despise, splitting the tax roll doesn't bring new money into the schools.
Governor Perry's other goal is to cap residential property tax appraisal increases at 3 percent per year. Homeowners would receive relief because their properties, for tax purposes, would barely increase in value from year to year.
But the problem isn't tax appraisals; it's tax rates. And the proposed cap would affect all local governments, not just schools. It's off-target and unnecessary. Bring new state money to schools, and school districts could and should slash their tax rates.
Lawmakers need to produce a better plan. In any special legislative session, they should:
Be bold. They need to overhaul the tax system. In Texas, some groups, such as homeowners and manufacturing companies, pay too much, and others, such as lawyers and accountants, pay too little. Right now, corporations pay business taxes but partnerships don't. Lawmakers need to pass a business tax that would ensure that anybody operating a business pays. The expanded tax base needs to provide enough money to allow school districts to cut local property tax rates by at least one-third.
Legislators should also stay focused. Lawmakers should ignore distractions like property appraisal caps and stick to public education.
Last, they should reject revenue gimmicks. These are the sin taxes we all love because we think someone else who's doing something he shouldn't do will pay them. Governor Perry has proposed raising new money by increasing the tax on tobacco products, legalizing and taxing video poker, and collecting a per-patron fee from topless bars. Gimmick taxes tend to be unreliable sources of revenue - people smoke less when cigarette taxes jump - so the state shouldn't depend on them to fund critical services like public education. If we care about schools, we should all be willing to pay.
Special sessions last only 30 days. Lawmakers must work fast but wisely to produce a school-funding plan that will benefit children, taxpayers and the state.
Jennifer Nagorka is a writer from Dallas. If you have opinions or a rebuttal about this commentary, please call our Listener Comment Line at (214) 740-9338, or contact us through our website at KERA.ORG.