An Update on the 86th Legislature 1
Key Dates in the 86th Legislative Session May 6th January 8th (119th Day) (1st Day) Last Day for Beginning of House to report Session house bills May 27th (140th Day) March 8th Sine Die (60th Day) Bill Filing Deadline 2
School Finance Reform 3
CSSB 4, CSHB 3 and HB 3: Current Status April 25th Senate Education hearing, CSSB 4 introduced. CSSB 4 made ● substantial changes from the filed version. Committee also introduced a substitute for HB 3, which was identical to ● CSSB 4. ● Senate Ed. is expected to vote on a revised CSHB 3 this morning. The changes in the forthcoming slides describe the difference between HB 3 ● as passed by the House and the revised CSHB 3. 4
CSHB 3 HB 3, Engrossed Basic Allotment $5,880 $6,030 Cost-of-Education Both bills repeal the CEI. Index Small and Mid-Sized Both bills move it into a separate allotment. CSHB 3 has slightly higher weights Adjustment than HB 3, Engrossed. 5
CSHB 3 HB 3, Engrossed Teacher Pay Classroom Teacher and Librarian 25 percent of district gain related to Allotment of $5,000 for each full-time basic allotment increases dedicated to teacher and librarian. The allotment will non-administrative pay raises. decrease if a district’s ADA falls below 2018-19 levels. An additional adjustment related to benefits is included. Teacher Incentive Creates new Teacher Incentive Creates a new Educator Effectiveness Pay Allotment similar to one in the Allotment with a weight of 0.012 for introduced version of HB 3 (and campuses in high-needs census tracts identical to CSSB 4) or in rural areas.
CSHB 3 HB 3, Engrossed Performance-Based ● 3rd Grade Reading Outcomes Bonus No performance-based allotments Bonuses based on performance on STAAR. related to student outcomes. ● CCMR Outcomes Bonus .
Modelling Methodology for Performance-Based Allotments CCMR - Edu. Dis. Rate 100% ● Rank order all districts based on the rate of students that meet grade level on 3rd grade reading STAAR test or percent of grads demonstrating CCMR. For each allotment, create three separate ● rankings for the three student subgroup listed in the bill. Identify the district at the 25th percentile , and ● use that rate as the threshold for generating an 25th 30.4% allotment. percentile Districts get a per-student allotment for each of ● 0% their students that exceed that threshold.
CSHB 3 HB 3, Engrossed Compensatory Both bills create a new comp. ed. allotment based on student’s resident census Education Allotment block, with weights ranging from 0.225 to 0.275. CSHB 3 is based on block groups , while HB 3 is based on blocks .
A Quick Lesson in Census Blocks vs. Census Tracts 10
Census Blocks Census Tracts 11
Census Blocks Census Tracts The smallest level of geography Census Comprised of Census blocks. ● ● Bureau estimates demographic data for. Designated based on population. Average ● around 4,000 inhabitants per tract. Cannot ● Drawn based on visible features like be more than 8,000 or less than 1,200. roads, streams, as well as nonvisible features like property lines or Demographic estimates are provided ● governmental boundaries. annually on the American Community Survey. These are estimates covering 5 Demographic estimates are only ● years of data collection. provided in decennial Census. ● Subdivide as population in an area increases. ● Delineated by the Census Bureau every (Ex. Census Tract 1130 may be split into 1130.01 and 10 years. 1130.02 if 1130 pop. increases above 8,000) 12
CSHB 3 HB 3, Engrossed Other ● Mainstream special education weight ● Mainstream special education weight Student-Based is increased to 1.15 is increased to 1.15 Allotments ● Creates new dyslexia allotment with ● Creates new dyslexia allotment with weight is 0.12 weight is 0.10 ● Additional dual language weights of ● Additional dual language weights of 0.15 for ELLs and 0.05 for non-ELLs 0.15 for ELLs and 0.05 for non-ELLs ● Does not expand eligibility for CTE ● Extends eligibility for CTE funding to funding to additional grade levels grade 6
CSHB 3 HB 3, Engrossed Indirect Cost Repeals existing indirect cost allotments ● At least 52 percent of compensatory and does not replace them with new education allotment must be spent on Allotments/Spending spending requirements. eligible programs Requirements ● At least 52 percent of bilingual education allotment must be spent on eligible programs ● At least 58 percent of career and tech allotment must be spent on eligible programs Other New ● Creates a new allotment related to the No similar provisions in HB 3. Accelerated Campus Excellance plans. Allotments ● Creates a new allotment for fast growth school districts. Based on ADA, not value growth. ● Creates Dropout Recovery School Allotment
CSHB 3 HB 3, Engrossed Pre-K Both bills create a new early reading allotment with a weight of 0.1 that is commonly cited as providing the remaining funding needed for full-day pre-k. Both bills also provide waivers for districts to meet these requirements. CSHB 3 extends eligibility for free pre-k to the children of public school educators.
CSHB 3 HB 3, Engrossed NIFA Makes no change to appropriation limit, Increases appropriation limit to $100 keeping it at $25 million. million. Transportation Uniform rate per mile as set by Uniform rate per mile as set by Allotment appropriation appropriation Set-asides Sets aside $6 million of regular program No new set-asides for blended learning grants, and $8 million of CTE allotment for grants to P-TECH schools.
CSHB 3 HB 3, Engrossed Number of Golden 6 8 Pennies Golden/Copper Golden penny yield = $94.08 Golden penny yield = Penny Yields Copper penny yield = $47.04 Greater of: ● Per WADA per cent wealth of district at the 96th percentile of wealth, or ● $96.48 Copper penny yield = $48.24
CSHB 3 HB 3, Engrossed Recapture Both bills redefine recapture to be excess local share compared to entitlement. Formula Transition Establishes two targets based on the Establishes targets based on the Grant lesser of: lesser of: ● 100% of prior law revenue per ● 103% of prior law revenue per ADA, or ADA in the same year, or ● 128% of the statewide average of ● 128% of the state average of revenue per ADA. prior law revenue per ADA in the same year In even numbered years, the bill requires use of the 2019-20 prior law revenue as the target, and in odd numbered years, the use of the 2020-21 prior law revenue.
Property Tax Relief 19
CSHB 3 HB 3, Engrossed State Compression ● 92 percent in FY 2020 96 percent Percentage (applied to tier 1 ● 85 percent in FY 2021. Contingent M&O rate) on sales tax swap. ● In FY 2022, individualized district compression based on property value growth and inflation. Contingent on sales tax swap. ● Would increase to 100 percent in FY 2021 if the sales tax swap is not approved by voters.
CSHB 3 HB 3, Engrossed Copper Penny Both bills tie the compression of copper pennies to increases in the basic Compression allotment. Rollback Rate Both bills include similar formula for calculating for the rollback tax rate (i.e. not Calculation based on effective tax rate, but on the state compression percentage * $1.00 plus compressed enrichment pennies). Of course, with a lower initial state compression percentage, CSHB 3 will result in lower rollback rates.
Duelling Rollback Rate Calculation Methodologies ● Senate Finance/House Ways and Means Committees’ proposals calculate rollback rate based on the effective tax rate . The calculation for effective tax rate is unchanged for school districts under those bills from current law. ○ SB 2, As Engrossed multiplies the effective tax rate by 1.025. ○ CSSB 2 multiplies the effective tax rate by 1.02 . Passed the House last night 107-40. ● Senate Education/House Public Education Committees’ proposals calculate rollback rate based on compressed tier 1 M&O rate plus compressed enrichment pennies .
An Illustration of the Rollback Rate Calculation Under HB 3, As Engrossed Additional details can be found here.
CSHB 3 HB 3, Engrossed Residence Increases residence homestead Does not include increase to residence Homestead exemption to $40,000 homestead exemption. Exemption Tax Rate Swaps Requires language that would indicate No similar provision a district may not increase its M&O rate to create a surplus to pay debt service. Creates a basis for injunction against collection of taxes if district found in violation Bonds Requires ballot propositions for bonds No similar provision to include language “THIS IS A PROPERTY TAX INCREASE”
CSHB 3 HB 3, Engrossed Current/Prior Year Moves to current year values to Maintains use of prior year values to Values calculate local share the FSP. calculate local share of the FSP
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