By Bill Oakey – February 21, 2018
I have said this before, and I’ll say it again. AISD’s property taxes are the single biggest threat to Austin affordability. Nothing else even comes close. But if you thought the Robin Hood funding disparity was the only issue, guess what…That is only half of the problem. Each half of the problem is pretty scary, but taken together it’s a disaster. So, as soon as you finish reading this, please share it with as many people as you can. Our only hope in surviving the disaster is if enough people get motivated to speak out against it.
The State of Texas Is Double-Dipping on Your School Property Taxes…Here’s How It Works
Several years ago, the total State share of public school funding was 50%. The rest came from local property tax dollars. And as you know, big cities like Austin have to send back hundreds of millions of dollars each year in Robin Hood “recapture” payments. ($533 million this year). Those funds go to “property poor” school districts.
Every year for the past several years, our property appraisals have been going up. This is happening in all of the big cities that contribute to the Robin Hood system. That has caused school property taxes to skyrocket. And that’s where the double whammy comes in. The State is siphoning off this windfall of extra revenue, and spending it for non-educational items in the budget.
Here’s how it works. Technically, all of the Robin Hood revenue does flow to the property-poor school districts. But each year, as the pot of recapture money increases, the State decreases its share of public school funding. The “leftover money” from reducing public school funding gets spent on other items in the budget. This is a backdoor method of enacting a full-blown statewide property tax! That type of tax is unconstitutional, and it was ruled unconstitutional by the lower court. Then, the Texas Supreme Court ruled that it is constitutional, but “badly flawed.”
Let’s Take a Look At the Seismic Shift In State School Funding
State Representative Donna Howard’s office prepared this graphic that illustrates the problem. Here are the highlights:
- The State contribution to public school funding sinks from 45.3% to 31.7% from 2011 to the projection for 2019.
- The local property tax share shoots up from 54.7% to a projected 68.3% in the same period
- School property taxes make up 54% of your property tax bill.
Here’s how that looks in actual dollars for the same 8-year period:
- Local property tax share increases by $7 billion
- State share decreases by $3 billion
If you think all over those numbers look scary, just consider this – Every single one of them will get worse every single year unless we organize and mobilize to push for reforms!
Is the Robin Hood System Bad, Or Is It REALLY Bad?
These figures come from the AISD website. And remember, Robin Hood is only half of the double whammy…
- AISD is projected to send nearly $2.6 billion in recapture payments to the State between 2016 and 2020.
- By 2019, more than half of AISD’s local school property tax dollars will be sent back to the State
How Does Texas Public School Funding Compare With Other States?
On a national basis, Texas looks pitiful. You would think that business leaders would be the first to demand better educated candidates to fill critical jobs. But in Texas, “business-friendly” means lower taxes and less regulation. I would encourage these folks to take a hard, sobering look at some of these numbers. The U.S. Census Bureau’s latest report shows these rankings for per-student public school spending in fiscal year 2015. (Imagine how bad it must be now!)
- State funding per student: Texas ranked #47, with $4,189
- Local property tax funding per student: Texas ranked #19, with $5,716
What Are Our State Politicians Doing About This?
Some would like to spend more money on charter schools and less on public schools. And some want to restore the State share of public school funding to at least 50%. That’s where it was before the real estate boom caused the annual explosion of our property appraisals. But there is a cruel irony in all of this.
Gov. Greg Abbott and Lt. Governor Dan Patrick are blaming your high property taxes on cities and counties. They are running their reelection campaigns on a promise to put a cap on the revenue that cities and counties can raise through property taxes. This is a slick political trick that takes the growing public frustration over high property taxes and spins it upside down and backwards.
The State school financing system is the problem! And if it continues on its current path, Austin taxpayers will indeed face a true disaster. I contend that it is simply not sustainable. Unless enough wealthy people move here to completely displace nearly everyone who has lived in Austin for more than ten years or so. And after a while, even those newcomers would start to fume over the property taxes. The projected numbers are staggering.
Here’s What You Can Do to Help
- If you get a flier in the mail from anybody running for office that promises property tax reform by blaming it on city or county taxes, stick it right here:
- Send this blog post to every pertinent organization that you belong to. Encourage them to distribute it to all of their members. If they have regular meetings, ask them to put it on their upcoming agenda for discussion. Invite good speakers to make a presentation.
- Make sure that you and your family and friends vote for candidates that recognize and admit the true cause of high property taxes!
Finally, Here Are Two Things That We Need to Fight For
- The Robin Hood recapture system needs to be reformed to make it fairer for Austin and the other big cities. Austin has a huge number of students living in poverty.
- The State needs to stop double-dipping on our local school property taxes. They need to increase the State share of funding for public schools back to at least 50%, if not more.