HISD might avoid paying state
$100M mandated for recapture funds could go to repairs instead
The Houston Independent School District may be able to avoid paying part — or perhaps all — of its over $100 million statemandated recapture payment The potential reprieve comes after a school board lawyer found a state law allows districts that suffer storm damage to use recapture dollars to help campuses get back on their feet. The law, passed in 2009 in the wake of Hurricane Ike, permits districts located within counties designated as disaster areas to use their recapture payments to help cover disaster-related costs.
Recapture is the process by which the state of Texas collects money from so-called property wealthy districts to help buoy districts in poorer and often more rural areas. Houston ISD already paid the Texas Education Agency $77.5 million in recapture fees this year and could owe an additional $60 million for the 2016-17 school year.
Houston ISD Superintendent Richard Carranza said the law will allow the district to continue
fixing local schools and helping students while also helping to stabilize the district’s finances.
“This is a silver lining,” Carranza said. “We will be pursing every conceivable expense relating to Hurricane Harvey.”
The law could allow the district to use storm-related spending to offset its recapture payments for the next two years, Carranza said.
David Thompson, an attorney for Houston ISD’s Board of Education, said the law is meant to allow districts to use what they would have paid to the state to cover disaster-related costs not covered by insurance or FEMA.
“Think of all the things districts spend money on that you can’t insure or reimburse,” Thompson said. “All the thousands of personnel hours, the transportation costs after all the bus routes are out the window and kids are scattered in different areas.”
Thompson said he doubts the law will allow the district to get out of paying its entire recapture bills for the 2017-2018 and 20182019 fiscal years, which could be over $200 million next year alone. But he said the law will still allow the district to keep a “significant” amount of its local money.
Under the law, districts with property wealth above certain levels are required to “share the wealth” through the so-called “Robin Hood” school finance plan by paying “recapture.”
Voters who live within the school district’s boundaries have voted twice on questions relating to if and how Houston ISD should pay the state’s recapture fee, after HISD fell into the category of “property rich” school districts last year.
The first referendum came before voters in November 2016, when 62 percent of about 334,000 Houston voters told the district to refuse to pay the state’s recapture fee.
But after the Texas Education Agency threatened to detach some of Houston’s most valuable commercial properties from the district’s tax rolls to make up for the lack of a recapture payment, HISD’s board created a second referendum asking voters if they would prefer the state detach those commercial properties or if the district should willingly write the state a check.
Nearly 84 percent of about 29,000 voters in May opted to voluntarily pay the state’s recapture fee.
Houston ISD estimated last week Hurricane Harvey could cost the district nearly $700 million including repairing damaged schools, adding new bus routes and hiring counselors.
But Carranza said Thursday that the real cost could end up being much less, as some schools are not as heavily damaged as first thought.