Saving HISD

A no vote on Prop. 1 should show that Texas’ school-funding mechanism isn’t working.

Houston ISD voters now casting early ballots and on Nov. 8 will have an opportunity to strike a double blow for transparency and for property rights.

State-mandated ballot language that voters will see asks them to approve authorizing the HISD board to “purchase attendance credits.” The obtuse wording is asking voters to sign off on HISD paying local property tax dollars to the state because it’s now deemed a “property wealthy” district and is subject to a provision in state law known as “Robin Hood,” or “recapture.” Next year, that provision would mean HISD has $162 million less to work with in addressing the needs of more than 200,000 students, most of whom are economically disadvantaged and cost more to educate.

Since our first editorial, “Robbing HISD” (Page A35, Sept. 25), in which we recommended a vote of “no” or “against” recapture, an animated debate has erupted. Some arguments have questioned our stance, with more than one community leader or policy expert calling our recommendation irresponsible. They’ve offered a host of reasons for the criticism, but a key one is this: Voters rejecting recapture would trigger another provision allowing the state education commissioner to detach HISD’s most valuable commercial property from the district’s tax rolls and give it to a property-poor district.

Critics of our position are right that a “no” vote is a gamble. But a stand against recapture could have a lasting legal impact that we believe is worth the risk. It could finally force state lawmakers to confront and fix a school funding mechanism that doesn’t actually do what it’s billed to do.

Despite changes in school finance law over the past four decades, school district taxpayers still expect that their taxes will be used to fund education and, in the case of recapture, that revenues from property-rich districts will be redistributed to poor ones. But this is not how it works now. Recaptured tax revenues — in HISD’s case, estimated to be nearly $1 billion in the next four years if voters say “yes” — allow the state to reduce its funding to schools and then spend the “savings” on highways, prisons and other state budget items that have nothing to do with education.

Recapture funds were never intended to free the state from its primary obligation, calling into question the mechanism’s constitutionality, as have some school finance experts.

The Texas Supreme Court in 1995 ruled that recapture didn’t violate the Texas Constitution. Back then, however, recaptured funds were mostly applied to fund education. Now, diverted local property taxes have become a primary funding source for the Legislature — notable for its growth as oil and gas tax collections have precipitously dropped by $1.6 billion less than anticipated this year. What budget writer wants to give that up?

This year, 238 districts were required to forfeit local funds under the recapture process, quadruple the number in 1996. Recapture payments make up a sizable chunk of what the state spends on public education, with more than $2 billion in payments expected in 2017, according to the Texas Tribune.

Another possible constitutional issue: The Legislature needs district voters’ approval to send the funds to the state. But even if Proposition 1 passes, the state-mandated ballot language is too indecipherable to provide that approval. Bob Stein, a Rice University political science professor, told Chronicle reporter Ericka Mellon that the recapture ballot measure is so confusing he gave up on trying to poll Houston voters on their views about it.

If voters need an additional reason to vote “no” or “against,” they need only look to Austin’s experience. Voters in the Austin Independent School District approved the recapture measure in the mid-1990s. For the past 14 years, AISD has been on the hook for more than $1.5 billion in recapture payments, all of which comes from taxes paid on Austin real estate. AISD is the singlelargest payer of these tax transfers, representing nearly 12 percent of the recapture revenue that the state collects.

During the next five years — between fiscal years 2016 and 2020 — AISD is projected to pay to the state almost $2.6 billion collected from district taxpayers, according to AISD Chief Financial Officer Nicole Conley, who testified last month before Texas House of Representatives committees on appropriations and public education.

By 2019, more than half of every tax dollar collected in the Austin school district will go to the state. As Austin’s resources are being siphoned off, the district is facing increasing costs of operating its schools, including the salaries of teachers.

Can’t Austin simply compensate for the lost revenues by raising property taxes? That would be a hard sell to voters. If AISD were to increase its tax rate, the district would send more than 60 percent of any new revenue to the state, according to Conley.

Recapture provides cover for elected state officials to avoid voting for new taxes and facing up to the fact that some school districts have more costly needs than others. But the funding method is not right or fair, and it may even be unconstitutional. That’s why we continue to say no is the right vote on this proposition.